This post is part of G2's 2023 digital trends series. Read more about G2’s perspective on digital transformation trends in an introduction from Emily Malis Greathouse, director, market research, and additional coverage on trends identified by G2’s analysts.

An ERP software revival will help companies with digital resilience

Enterprise resource planning (ERP) has a complicated history and a bad reputation, mainly because this type of software can be complex and costly. But the concept of having all or most features in a single system is sound and will continue to grow as companies try to weather difficult times.

Why ERP is still critical for businesses

Two significant trends can explain an ERP revival: the success of cloud ERP and the advent of new types of software that emulate the ERP concept mentioned above.

By comparison, Salesforce's subscription revenue was up 23% in 2022, which means that ERP providers are growing their cloud business as much as one of the largest SaaS companies in the world and, in some cases, even more.

The second trend is less obvious but essential nevertheless. As cloud-native vendors grow, they keep adding new features to their core products, which are closer to ERP tools than the base product. For instance, project management vendors like monday.com created solutions branded as work management software, which is very similar to ERP. The idea behind work management is to provide the functionality to help a company manage work across its teams. However, for now, this is limited to professional services companies, unlike ERP, which often focuses on advanced industries such as manufacturing and retail. Also, work management does not yet include features for accounting, which are usually part of ERP systems. At the same time, vendors like Xero, which started by selling accounting tools, also added additional features such as inventory management or purchasing. 

What does G2 data show regarding ERP systems?

 G2 traffic for ERP systems exceeded project management, even though the latter is still more popular than the former based on Google trends data. The main difference between the two data points is that Google shows general interest in search terms, while G2's data is evidence of increased buyer interest in ERP.

Despite everything, ERP is here to stay

Whether it's ERP, work management, business management, or advanced accounting, the importance of having a single system for most business needs seems to grow quickly. In addition, economic difficulties will force companies to review their software buying strategies even more so. As for the cost, these types of solutions may be more expensive in the short term but having multiple products is likely to be more costly in the long term.

We expect companies to focus more on strategic software investments and less on trying the latest shiny tools that have yet to prove their efficiency.

Edited by Shanti S Nair