Unit4 sets out a strategy to be the last ERP midsize enterprises buy

The Situation: At its European Analyst Summit in May 2022, Unit4 announced its intent to position as the ERP of choice for mid-market companies, defined as companies with $100 million to $1 billion in revenue. Its investments in tailored solutions that quickly deliver ROI, reduce integration risk, and deliver business value align with the HFS OneOffice. But customers might not recognize a transformed Unit4 that has streamlined its offerings in the past three years.

Mid-market companies struggle to make the necessary investments and gain strategic business value from large systems of records because they are often costly and complex to run. A cloud platform tailored for the midmarket that runs enterprise resource planning (ERP) processes and integrates with other applications provides a better modern solution for these companies.

Think outside the process box

Enterprises must adopt a holistic, OneOffice mindset connecting the front, middle, and back offices to maximize business value. As we highlighted in our HFS SaaS XXV report, SaaS solutions that deliver business value complement and enhance user experiences by including artificial intelligence (AI), analytics, automation frameworks, external application interfaces (APIs), and, increasingly, low-code tools.

Unit4 is on a journey to include these for its target mid-market customers. Since taking over as CEO in 2019, Mike Ettling has rationalized and simplified Unit4’s offerings, with a focus on delivering an integrated set of ERP applications, including finance, procurement, projects, financial planning and analysis, and human capital management (HCM). Unit4 added supply chain management to the mix with the acquisition of Scanmarket on June 1, 2022. Unit4 is also developing tailored solutions under the umbrella of Unit4’s operations mantra “Right for Your Business,” which includes industry and country specifics, enhanced user experience, automation, and APIs.

The jewel in the crown is Unit4’s ERPx multi-tenant cloud platform, released in April 2021. Determined to be recognized as a cloud company, Unit4 is now focusing all effort on increasing the ERPx business, which currently has 126 customers.

Leverage Unit4’s tailored solutions for people-centric industries

While Unit4 has customers across 15 industries, its primary targets are people-based sectors, namely professional services, higher education, non-profits, and the public sector. Customers in these sectors can benefit from tailored solutions meeting their specific business needs. For example, a professional services firm can match skills and availability to upcoming projects. This focus and understanding of people-centric industries in the mid-market is Unit4’s sweet spot and differentiator. Customers in these industries can achieve a digital transformation, manage integrated business applications, and access solutions that understand their business concerns.

Consider Unit4 as part of your digital transformation journey

Unit4 has a loyal customer base that appreciates the independent software vendor’s (ISV) capabilities, but it has an uphill battle to drive mindshare with new logos. Moreover, mid-market customers have many ERP options. For example, Oracle, SAP, and Workday also offer ERP solutions for the mid-market. There is also a plethora of smaller, specialist providers. Twilio, for example, offers an employee and customer engagement platform. It ranked in the top 20 providers of our overall SaaS XXV report and in the top 10 of our Business Operations SaaS Top 10 Snapshot, 2022 for delivering business value. Unit4’s portfolio of integrated HCM and finance on a multi-tenant cloud platform also mirrors the value proposition that Workday delivers, which also targets companies as small as 500 employees. Mid-market companies may be more aware of Workday’s capabilities, given its high-profile global partner ecosystem, which includes the likes of Deloitte and Accenture. Workday ranked in the top 15 in our SaaS XXV report for delivering business value. Unit4 has more recently revamped its partner program to boost sales. Despite an exciting marketplace scheduled for launch in November 2022, which will facilitate tailored application development, Unit4 is playing catch-up—it failed to make it into our top 25 ranking for business value.

The Bottom Line: Mid-market enterprises in people-centric industries should consider Unit4 for cloud ERP solutions that align with business value

Ettling has a clear strategy, vision, and roadmap for Unit4 that aligns with the HFS definition of business value. He wants to guarantee customers that “this is the last ERP you will have to buy.” However, Unit4 must focus on raising awareness of its cloud platform and industry sector expertise with existing and new logos if it is to succeed. It would be ironic if Ettling’s historical rival when he was at SAP SuccessFactors—Workday—comes back to haunt him in the midmarket.