The ERP industry, as we know it today, has been with us for over 20 years and in that time the constant rhythm of competitive forces has seen companies appear, grow, merge and disappear. As active participants within the landscape, we rarely get an opportunity to rise above our daily errands and study the history of the industry we have chosen to embrace. In this study, we attempt to break this trend and peek at the ERP industry from a different perspective – a purely academic view of where it all started and where it is now. The four maps before you depict today's state of the ERP industry and provides an interesting insight into its origin.
Map 1: ERP Company Count by Country
So which country has the most number of ERP vendors? The top spot is probably no surprise - yes, it's the US with an overwhelming 71 active ERP vendors. As for second place, the mighty SAP and its home country of Germany comes to mind; however, surprisingly, the humble northern country of Canada takes the silver podium place, finishing with as many ERP companies in the country as the next three countries combined. And the bronze goes to the UK – the formidable hub of software talent and ideas.
Germany, despite housing the largest ERP vendor in the world, comes only 6th in the ranking of total companies active in a country, sharing its finishing position with France, Israel and the Netherlands.
Map 2: ERP Company Count by Capita
While it may be interesting to note the total number of companies in a country, this statistic does not accurately reflect the creativity and productivity of a country's population when it comes to spawning and nurturing ERP enterprises. Accounting for the population size, the following picture emerges (see Map 2 for details).
By this measure, Canada becomes the global leader, having 11 active ERP companies for its population of 35 million, or 3.14 companies per 10 million citizens. Immediately on its heels comes the Nordic nation of Sweden with 3 active companies for its population of 9.5 million. Perhaps predictably, the nation of entrepreneurs - Israel - takes the bronze, beating a surprise fourth finish by Costa Rica. The US comes fifth, just a notch behind the Latin American nation. To add to a bundle of surprise finishes - Costa Rica 4th, the US 5th and Germany in twelfth place - comes India. Despite its flourishing IT sector, India's presence in the ERP space remains limited with just 3 active ERP companies for its population of nearly 1.2 billion.
Map 3: Top ERP Company Count by Country
The total number of ERP companies accounts only for the sheer number of companies without giving any weight to the relative clout of each company. Therefore a company providing services to the Fortune 500 companies and to governments is viewed the same as a company that sells a few licenses annually to small businesses.
Taking clout into account and looking at the data provided by Forrester Research who only looked at companies that exceeded a particular "clout" threshold, Map 3 illustrates the distribution of the Top ERP vendors today by country.
Map 4: ERP "Origin" Company Count by Country
However, many of today's top ERP vendors did not fully originate in the country where they are headquartered today. For instance, in 2002 Microsoft bought Navision A/S, a Danish company, which had already merged with a fellow Danish firm - Damgaard A/S in 2000. The result? Microsoft Dynamics AX and NAV.
The ERP portfolio of Infor, the third largest ERP vendor in the world (after its acquisition of Lawson in 2011), has its roots from the Netherlands, the US and the UK. If we add this "origin" data to the mix, we arrive at a different picture of the top countries that influenced the ERP software field.
And finally, if we re-add in the per capita factor, we arrive at a surprising result. Denmark (population of 5.5 million), the Netherlands (population of 16 million) and Norway (population of 5 million) have contributed the most (per capita) to the foundation of today's ERP industry. Sweden follows closely to finish fourth with the UK coming in fifth. All in all, a relatively small region of Northern Europe with a radius of approximately 500 miles and a population of roughly the size of California, has created over a third of the world’s leading ERP products, or more than the rest of the world, excluding the US, combined.
Here ends our peek into the ERP industry for now. Look out for future articles and Thank You for reading!
To request a high-resolution (2Mb, 4270x1200 pixels) copy of this inforgraphics please contact Alexandre Pestov, VP of Business Development (alec.pestov@3BResearch.com
About This Study
The research for this inforgraphics was commissioned and conducted by 3B Research and Consulting (3BRC: www.3BResearch.com
). The content of this research report is the property of 3B Research and Consulting. Please consult with 3BRC before reproducing this material in whole or in part. All inquiries regarding this report should be directed to Alexandre Pestov, VP of Business Development (alec.pestov@3BResearch.com
26 Oct 2012