Microsoft has announced the availability of its Dynamics Suite of Enterprise Resource Planning (ERP) applications as a subscription service which will allow businesses to use these solutions without the need to install it within the company's own premise. This model will increase the affordability of ERP solutions by eliminating upfront capital expenditure and also eliminating the need for in-house IT resources and additional infrastructure. Customer will have to pay on a per user per month basis. Microsoft believes that this new offering will allow a much larger set of SMBs in India to adopt and benefit from ERP services.
The ERP application will be hosted by a Microsoft Channel Partner and can be accessed by companies through multiple access modes such as VPN and Internet. The Partner will also provide turn-key solutions right from initial setup and staff training, to management of the application for the company and complaint resolution. Microsoft's first partner for this service is Bangalore-based Affordable Business Solutions (ABS), a leading IT solutions provider that is focused on the SMB market in India.
Currently ABS is offering 3, 5 and 10-user ERP packs for basic material and financial accounting functionalities for a small business priced at Rs 25,000, Rs 35,000 and Rs 60,000 per month, against the Rs 10-15 lacs upfront payment in the traditional model -not taking into account the additional cost of hiring and training an ERP professional to manage the application.
Speaking at the launch Mr. Rajeev Mittal, Group Director– Small and Medium Enterprises, Microsoft India , said, ‘ By reducing upfront investment costs and eliminating need for in-house IT management resources, our new offering makes ERP solutions much more affordable and easy to deploy. We are confident that the SMB segment in India will benefit from the accessibility to ERP solutions that this model offers, and that it will in turn accelerate the already healthy pace of IT adoption in the SMB community.'
This announcement comes at a time when the market for ERP in India is booming, with increasing number of firms especially in the SMB segment looking to adopt ERP solutions as the first step to a broader IT deployment. According to IDC, the ERP market is expected to maintain a CAGR of 18% over the period 2006 -2010 , with the SMB segment accounting for 47 %.
‘While the hosted ERP application has all the functionalities available as in the traditional on-site model of deployment , customers can opt to subscribe to the specific functionalities that they need at the moment and expand the subscription to others when they are ready.' , says Mr. Srikant Rao, Founder-Director of Affordable Business Solutions. ‘Feedback from initial conversations with customers has been very encouraging, and we believe that this will trigger a rapid upswing in IT usage especially in the SMB segment in India. We are proud to be the first to associate with Microsoft Dynamics to bring the hosted, subscription-based ERP model to India.' he added.
Microsoft aims to provide hosted ERP services more broadly with a help of its partners and is already in the process of enabling many more partners across India . This announcement is part of Microsoft's Software plus Service vision, under which the services are being designed to complement existing Microsoft applications and extend them to the Web. ‘ We believe this new world of software plus services delivered via the Internet is a fundamental shift that will take place in the future – and one that we aim to lead. Microsoft is dedicated to helping users and partners take advantage of the wide array of technology available today and realize the full capabilities of the networked environment by delivering innovations such as the hosted ERP model. ', added Mr. Mittal.
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