Microsoft smiles as Indian SMBs demand ERP

Microsoft smiles as Indian SMBs demand ERP

Already tagged as the ‘watch-out-for’ player in an established ERP market in India, Microsoft sounds confident about cracking it right with its Dynamics line of ERP offerings

Thursday, July 10, 2008

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But how well is it positioned to handle the Indian customer, up against its international competitors? Sushant Dwivedy, director, Microsoft Business Solution, Microsoft India, explains this to Pratima Harigunani from CyberMedia News.

We know Microsoft as the software giant of this century. But talk of the Enterprise Resource Planning (ERP) software market, names like Oracle and SAP steal the thunder. But predictions have it that Microsoft could overtake Oracle Corp. in fresh licence sales of business software in India by 2010, if its SMB strategy pays out well.

ERP, which basically helps companies, streamline different parts of their business like manufacturing, supply chain, operations, budgeting and human resources is a booming market in India.

At present SAP rules it with a 48.3 per cent share, followed by Oracle at 24.9 per cent. Microsoft India Pvt. Ltd stood at 12.2 per cent according to Indian enterprise application software market revenues data for 2006 by Frost & Sullivan. It had also predicted that the market for fresh ERP licenses sold each year in India to touch about $185 million by 2013 and over half the demand for ERP solutions expected to come from small and medium enterprises or SMEs, a segment which will continue to drive the market in the future.

Analysts have already started pointing that while SAP, Oracle and Microsoft will continue to dominate the market in the future, the possibility of Microsoft overtaking Oracle in the next two years is very likely.

So where does Microsoft see itself standing with Microsoft Dynamics, its line of financial, customer relationship and supply chain management solutions and how does it interpret the common issues raised by Indian CIOs with foreign ERPs. Read on…

It has been just about three years since you entered this market. How has the going been so far?

It was in 2005 that Microsoft Dynamics suite was offered in India. The last two years have been momentous in terms of the footprint, which the suite of products has left on the customers in India. An iteration of the impact was manifest in Microsoft Dynamics being voted number one against the index of customer satisfaction, in an annual survey of Customer Satisfaction in the enterprise application space, conducted by research firm IDC in conjunction with Dataquest this year.

In another survey conducted in March, 2008 by IDC for DQ Channels in India across 19 cities and 898 channel partners Microsoft won the Channels’ Choice Gold award for best enterprise application. Our goal initially was to make ERP as easy and usable as a PC.

So from business standpoint that meant easy-to-use applications. Business applications don’t fail, it’s all about how people use them. We have focused on ease of deployability Talking of SMB market, when we entered, SMB segment was emerging and now it is shortly entering the maturity phase.

Earlier we had to explain ERP as a concept, today it is the customer who asks for what ERP suits his industry best.

So are you in a position to claim an edge over other competitors or in-house systems with respect to the Indian ERP market?

The market here is characterized with be-spoked applications. And then there were some small applications apart from the big pieces. It’s not the companies have not spent on ERP; they have those applications but not an integrated offering.

The payroll, CRM, etc. is different pieces. One piece does not talk into the other. You may have some application developed here and other. We have an edge over others when it comes to making it available at the right time, with the right partner approach, to the right customer.

Microsoft Dynamics for instance, has the Outlook interface flavour. We are trying to cater to the people where they need to have it. These are the kind of differentiators that position us differently.

How do you respond to the grievances that many Indian CIOs still have when it comes to inadequate customization to a specific vertical or industry?

I have a different point of view from Microsoft’s standpoint. Our focus has been actually extremely verticalised. We have examples with industry clusters like that of textile in Tirupur, pharma in Ahmedabad, auto and ancillaries in Pune.

The biggest challenge, for an apparel manufacturer for instance, is to deliver his offering in time and he needs technology enablers. We have identified partners to cater to specific industry needs, we have vertical heads and specialists and the traction has been very positive so far.

Isn’t the AMC cost burden heavy enough for customers?

I don’t think the Indian customer is worried about price as long as he gets value.

Not even the customers from the SMB market?

The days are gone when one just produced and got away with selling in the domestic market. Today a manufacturer needs to have products in the right volume, he really needs to scale it smartly and be profitable. It’s a global game now and efficiencies and global competitiveness are a must. That’s what is driving usage of IT and ERP deployment in this market. It’s all about getting the right value.

So what is lined up for the next version 5.0? What exactly is expected out of the role center feature?

We are focusing on better usability, a simple user interface as the compelling feature. In case of role centers we would have specific front-ends for every role profile. For example, a store keeper will have whatever he needs on his table, be it the escalations he needs to manage, files, mails whatever he needs as an individual on the table.

Why is that your ERP portfolio has developed majorly around acquisitions like Navision, Axapta, Great Plains, etc? Would you extend it to other functions next?

The domain products did come from acquisitions but we have improved them through our core technology perspective. We would continue to focus on making the product simpler, better and easier for the user. No other functions but a focus on verticals will drive the product focus.

©CyberMedia News