Tier 2 ERP Software

Tier 2 ERP software is a term often used by ERP consultants and consulting firms such as Gartner to describe ERP solutions which are a good fit for small and medium sized organizations, or larger organizations with low complexity. Typically, Tier 2 ERP software is used by businesses with 50-1000 employees and annual revenues of $10 million to $1 billion.

Tier 2 ERP Software typically costs a minimum of $100,000 in Year 1. The cost of your Tier 2 ERP software will consist of:

• 10-30% ERP software licensing
• 30-60% ERP implementation
• 10-20% ERP consultancy/change management

Advantages

• Tier 2 ERP software is typically low cost and low complexity to implement.
• Typically Tier 1 ERP is supported by several millions of R&D and investment from ERP vendors to continuously improve it.
• Tier 2 ERP software is well used by other mid-sized companies, meaning you're rarely the only other company using it or on the same path.

Disadvantages

• Tier 2 ERP software may not provide enough room for growth for some organizations on hypergrowth trajectory.
• Tier 2 ERP systems may not provide complete depth of functionality in particular areas. For businesses in complex industries such as pharmaceuticals or high tech manufacturing, Tier 2 ERP systems may have deficiencies.

Tier 2 ERP software such as Netsuite, Acumatica, Business Central or Sage can take anywhere from 3 months to one year to implement. The length of time is typically dictated by:

• Internal and external resource constraints
• ERP project scope
• ERP project complexity
• Customization
• Integration