The business software provider Forterro has now conducted its first ERP Barometer 2024 study. "More than half of SMEs in Germany still rely on an on-premises solution. Especially those who process sensitive data prefer to have control over systems and data," says Marcus Pannier, President Central Europe at Forterro.

ERP solutions have been standard in large companies for some time. SMEs, on the other hand, have long hesitated, as business planning software has the stigma of being a complex, expensive and cumbersome IT system that requires an entire IT team to support and maintain.

In the meantime, scalable ERP systems are gradually conquering SMEs. "Reason enough for Forterro to investigate the question of how small and medium-sized companies benefit from an ERP system in general and from a cloud-based ERP system in particular," says Pannier, explaining the background to the study, which was conducted for the first time.

The results

The study shows that 74% of the companies surveyed currently use an ERP solution or business management software. The remaining 26 percent are planning to use a corresponding business software within the next two years. Just over half of SMEs (52%) operate their ERP system as an on-premises solution. The trend of migrating everything to the cloud does not yet seem to have fully taken hold, at least among small and medium-sized enterprises. When asked about the reasons for their decision in favor of an on-premises ERP system that runs locally on the company's internal servers, respondents cited issues such as data protection and security.

In particular, companies that process sensitive data preferred complete control over their systems and the ability to manage data internally. In addition, the adaptability of the on-premises solution to individual needs was cited as an important decision factor; specific requirements and processes of SMEs could be integrated more easily in on-premises solutions.

However, the cloud moment is also slowly arriving among SMEs. Interest in software-as-a-service (SaaS) models and an ERP solution from the cloud is growing. As many as 31% of the companies surveyed already use ERP as software as a service. 16% of SMEs are on the threshold of the cloud, but have currently opted for a hybrid form of provision.

"There are often cost reasons for making the switch," says Pannier. "Cloud-based ERP systems offer companies the opportunity to access powerful, always up-to-date software without having to invest heavily in IT infrastructure." As many as 15 percent of the companies surveyed that operate their ERP on-premises have been using the solution for more than ten years.

The study participants expect the proportion of cloud users to increase from the current 31% to 45% and the proportion of hybrid deployment forms from 16% to 20% in the medium term. Conversely, the proportion of ERP on-premises users will decrease from the current 52% to 32% over the next two years. Of the companies planning to use an ERP system for the first time, 47% are expected to obtain their ERP software completely from the cloud and 19% at least in part.

The study method

The study was designed and conducted by Techconsult on behalf of Forterro. 200 small (1 to 19 employees) and medium-sized (20 to 999 employees) companies from industry, trade and services were asked about their ERP solutions and future plans. The survey was conducted via an online questionnaire. The main contact persons were IT managers, IT administrators and managing directors.