The State of Enterprise ERP Systems in CEE region 2024

In the rapidly evolving business landscape, the imperative for advanced Enterprise Resource Planning (ERP) Software has never been more pronounced. These sophisticated systems encompass a suite of applications pivotal for orchestrating and refining crucial business functions — ranging from human resources and finance to capital management, materials procurement, and order processing. By harmonizing internal processes, bolstering efficiency, and empowering data-driven decision-making, ERP solutions are not merely advantageous — they’re becoming integral.

As we witness an upsurge in their adoption, companies across the board are faced with choice of which system vendor to choose from and what type of implementation — on-premises or cloud-based. How this situation looks like in CEE? Let’s take a closer look at this.

Revenue of the ERP Software Industry in the CEE Region 2024–2028

In recent years, the ‘Enterprise Resource Planning (ERP) Software’ market has witnessed a consistent upward trajectory. It’s projected that global revenue in this sector will reach an impressive US$52.33 billion in 2024. Moreover, the market is anticipated to experience a steady annual growth rate (CAGR) of 4.48% from 2024 to 2028, culminating in a market volume of US$62.36 billion by the end of the forecast period.

While the robust US market is expected to contribute 42% of this revenue, the Central and Eastern Europe (CEE) region, though currently holding a smaller market share, is demonstrating signs of exponential growth. With optimistic forecasts and an increasing rate of adoption, the CEE region is poised to become a significant player in the ERP software industry.

Source: statista.com

This table provides a valuable snapshot of the Enterprise Resource Planning (ERP) software industry’s health and trajectory within the Central and Eastern Europe (CEE) region. A few observations stand out:

1. Poland’s Leading Position: Poland is not only the largest market but also shows robust growth. With a projected revenue increase from $157.7 million in 2024 to $207.02 million in 2028 and a strong annual growth rate of 6.28%, it’s clear that Poland is a powerhouse for ERP software in the CEE, likely due to its larger economy and more substantial industrial base.
2. Consistent Growth Across the Region: Every listed country exhibits positive growth, with annual growth rate (CAGR 2024–2028) above global growth rate 4.48%. This indicates a healthy, expanding market for ERP solutions in the CEE region, driven perhaps by increasing digital transformation efforts and the growing recognition of ERP benefits among businesses.
3. Varied Market Maturity: The wide range in revenue figures suggests varied market maturity levels. Larger economies like Poland and the Czech Republic have more substantial revenue figures, indicating more mature markets.

In summary, the CEE region presents a dynamic and growing market for ERP solutions, with countries at various stages of adoption and growth. Businesses operating in or entering this market should consider these differences in market maturity and growth rates to tailor their strategies accordingly. As the digital landscape evolves, these nations show promising potential for further adoption and market expansion.

Transitioning from Traditional ERP to Cloud-Based and Industry-Specific Systems

As the ERP software landscape evolves, organizations are increasingly adopting cloud-based systems over traditional on-premises solutions. While the traditional systems offers robust features, they typically require complex setups and extensive IT management. In contrast, cloud-based ERPs, or SaaS, provide streamlined interfaces and customizable features, all managed by the provider. This transition signifies a shift towards more flexible, scalable, and cost-effective operations. Furthermore, a notable trend is the move from universal ERPs to industry-specific solutions, designed to meet unique sector needs with specialized functionalities.

Additionally, there’s an emerging trend in the ERP landscape, shifting focus from universal, one-size-fits-all systems to industry-specific ERP solutions. Industry-specific ERPs are tailored to meet the distinct needs of sectors such as food and beverages, fashion and apparel, manufacturing or retail, offering specialized functionalities, compliance capabilities, and workflows right out of the box. This shift towards customization enhances efficiency and compliance, meeting unique industry demands. As organizations seek to optimize their operations with these precise tools, the demand for bespoke ERP solutions is set to grow, diversifying the market.

Advantages of cloud ERP Systems

Customers can migrate from outdated ERP systems or basic accounting software to a single cloud solution that can manage finances, operations, sales, and customer care. Helping businesses streamline their processes, improve their relationships with customers, and make room for growth by:

• High Accessibility: Cloud ERP implementation allows users to access real-time data and applications from anywhere at any time, using any device with an internet connection, enhancing flexibility and remote work capabilities.
• Zero Upfront Costs: Cloud ERP systems typically operate on a subscription basis, eliminating the need for large initial investments in hardware and software, making it a cost-effective solution for businesses of all sizes.
• No Maintenance Responsibilities: The cloud ERP provider manages all updates, upgrades, and system maintenance, freeing the customer from technical responsibilities and ensuring they always have access to the latest features without additional effort.
• Highest Security Standards: Cloud ERP providers invest heavily in security measures, including data encryption and regular security audits, to protect sensitive business information and ensure compliance with regulatory standards.
• Speedy Deployment: Unlike traditional on-premise systems, cloud ERP can be deployed rapidly since it doesn’t require physical infrastructure setup, allowing businesses to benefit from the system’s functionalities and improve their operations without significant downtime.

Top 5 cloud-based ERP systems

Microsoft Dynamics

Microsoft Dynamics 365 stands as a prominent ERP solution, offering businesses the tools for real-time insights and streamlined operations. Seamlessly integrated with an array of other Microsoft products like Office 365 and Power BI, it ensures a cohesive user experience. The Dynamics ERP suite, encompassing Dynamics 365 Finance and Operations, Dynamics 365 Business Central, and Dynamics GP, is tailored to adeptly manage a spectrum of business needs. From financials and supply chain to inventory and customer relationship management (CRM), these products provide a comprehensive, flexible, and interconnected platform designed to empower businesses to optimize their processes and drive growth.

SAP Business One

SAP is one of the largest ERP companies in the world, with a market share of over 20%. SAP’s ERP system provides real-time insights into business operations, which can help companies make informed decisions and improve their overall performance. SAP’s flagship product is SAP ERP, a suite of enterprise resource planning software that covers finance, supply chain, human resources, and other core business functions. SAP also provides a range of complementary solutions, such as customer relationship management (CRM), data management, and analytics. SAP is a leading provider of enterprise software solutions and is used by businesses of all sizes across a range of industries.

Oracle NetSuite

Oracle is another leading ERP company that offers a range of solutions to meet the needs of different industries. Oracle’s ERP, as a cloud-based, integrated system, offers an expansive suite of applications covering areas like financials, CRM, e-commerce, inventory management, and more. Designed to scale with businesses as they grow, NetSuite provides real-time data visibility and insights, enabling companies to make informed decisions swiftly. Its powerful customization and automation features streamline operations, enhance efficiencies, and support the unique demands of various industries. With its global reach and commitment to innovation, Oracle NetSuite stands as a pivotal tool for businesses aiming to thrive in a dynamic and competitive environment.

Sage

Sage is a popular ERP solution that is designed for small and medium-sized businesses. Their ERP system provides businesses with a centralized platform to manage their operations, finances, and supply chains. Sage’s ERP system is known for its user-friendly interface and affordability. Sage has been expanding its offerings to include cloud-based solutions, such as Sage Business Cloud, which includes a suite of cloud-based financial management tools, as well as Sage Intacct, a cloud-based ERP solution that is designed for growing businesses. Sage’s products are used by businesses in a variety of industries, including manufacturing, retail, and professional services.

Aptean

Aptean is one of the world’s leading providers of purpose-built, industry-specific software that helps manufacturers and distributors effectively run and grow their businesses. With both cloud and on-premise deployment options, Aptean’s products, services and unmatched expertise help businesses of all sizes. Aptean offers unique technology built on the Microsoft Dynamics 365 Business Central platform, which affords it a familiar feel and optimized user experience; while assisting you in realizing your full business potential through technology and digital transformation. This means you get all the benefits of choosing a large, established, familiar ERP platform, whilst also gaining the industry-expertise and specialization of both the Aptean software and team. Currently, Aptean has more than 10 000 customers from 85 countries and helps in the industries like food and beverages, fashion and apparel, manufacturing or retail.

The Future of Enterprise Resource Planning Systems in CEE

The Central and Eastern Europe region is on a trajectory of remarkable growth and transformation when it comes to the ERP systems potential. It’s exhibiting exponential growth, underpinned by positive forecasts and escalating adoption rates. Poland emerges as a leading force in this region, thanks to its larger economy and industrial base. The entire region, showcasing growth rates surpassing the global average, reflects a vibrant and expanding ERP market. As the digital landscape continues to evolve, the CEE region not only promises substantial opportunities for ERP adoption but also stands as a testament to the potential for technological advancement and business innovation.