Choosing between small niche products and large enterprise resource planning vendors

Some HR software is all encompassing and comes from well-known software companies; other packages are smaller and are provided by niche suppliers. Which will suit you?

For smaller or niche organisations, a best-of-breed HR software application may well make more sense than a comprehensive package form a larger vendor.

Leicester-based housing association LHA-ASRA is currently looking for a new HR software package. But group HR director Brian Bennyworth says it’s unlikely that the association with opt for HR software from an ERP (enterprise resource planning) vendor such as Oracle or SAP.

“I’ve been down that road before, and while you might end up with a ‘Rolls-Royce’ software application, that’s no good if you don’t use most of the functionality you’re paying for,” he says. “For a smaller organisation like ours, I would much rather look at a smaller, specialist vendor.”

In smaller companies, there’s often also a belief that huge software companies will ignore you if there’s a problem, Bennyworth adds. “I just have a feeling that when we buy from a smaller vendor, we’re a bigger fish to them, which makes it easier if things go wrong.”

Traditionally, ERP applications have been seen as expensive and cumbersome, but this has changed in recent years – many companies now offer ‘lite’ versions of their HR and payroll software, and these may be available as web-based hosted applications for smaller customers.

One powerful advantage of buying from an ERP vendor is that the software – in theory at least – integrates seamlessly with other line of business applications. Integration is a key issue for many companies, and buying everything from one supplier can result in an integrated set of processes and applications that are very attractive to companies looking to cut costs.

That’s certainly the experience of Star, a UK-based ISP that uses Oracle HR software, along with Oracle finance, marketing and customer support applications.

“We absolutely believe it offers powerful advantages in terms of integration and consistency, and the time we’ve saved has a huge part of supporting our aggressive growth strategy,” says Mina Kumari, the company’s HR director.

Ultimately, remember that software not a religious war and your choice of best-of-breed versus ERP is likely to change depending on your specific goals, available budget and internal resources.

Comments are closed.