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ERP Vendor Approaches to Penetrating Developing Countries

 

August 19, 2014

Doug Hadden, VP Products

There seems to be two approaches for achieving success in developing countries and emerging economies with enterprise-class software. A recent press releases from one of the major ERP vendors demonstrates one approach:

  1. Keep the legacy design of the software developed for advanced economies
  2. Diagnose the problem of high failure rates as a capacity problem: not enough professionals capable of using, supporting and customizing complex software, not enough bandwidth to suport systems
  3. Fund universities, Public-Private-Partnerships, work with International Financial Institutions to create educational programs designed to train people on your proprietary product
  4. Publicize with press releases
  5. Make some user interface changes that aids in usability, but does not fundamentally change the financial sustainability of solutions
  6. Call it "innovation"

We've elected to take a completely different approach:

  1. Fundamentally redesign software architecture to address the government domain
  2. Build "progressive activation" that enables matching human capacity to system functionality
  3. Optimize the technical footprint to reduce the need for high bandwidth or numerous servers
  4. Collaborate with government customers to simplify system usage and administration
  5. Focus on how we can make our systems financially sustainable

The Tier 1 ERP vendors are very challenged to move "down market" whether smaller organizations or in less developed countries. The economic model breaks down because of high costs from implementation, training, upgrades and maintenance. The approach is like "lowering the river" instead of "raising the bridge." Except in this case, dredging up new customers costs customers far more than designing to meet the need.

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Doug Hadden

Doug Hadden

Executive Vice President, Innovation at FreeBalance
Doug is responsible for identifying new global markets, new technologies and trends, and new and enhanced internal processes. Doug leads a cross-functional international team that is responsible for developing product prototypes and innovative go-to-market strategies.

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