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622 PART 6 Managing Business Operations, Management Information Systems, and the Digital Enterprise

has been in the process of merging with J.D. Edwards, and Oracle announced a hos-
tile takeover of PeopleSoft. Other ERP software vendors include but are not limited
to Great Plains, Lawson, QAD, Ross Systems, and Systems Union.
Baan was founded in the Netherlands in 1978. Baan’s ERP market share is
approximately 4 percent and its 1998 revenues where roughly $750 million U.S. dol-
lars. Baan has over 3000 clients in 5000 sites worldwide. Baan was thrust into the
international ERP software spotlight when it won the Boeing Company ERP
engagement in 1994.
J.D. Edwards recently introduced its multiplatform software, OneWorld, which
was designed to gradually replace its previous ERP product. Reportedly, OneWorld
is designed for between 5 and 500 users. In 1997, J.D. Edwards commanded about
7 percent of the ERP market, mostly concentrating in midsized companies. In 1998,
its ERP revenues were $979 million U.S. dollars. J.D. Edwards is a U.S. company.
PeopleSoft was founded in 1987 and went public in 1992. PeopleSoft is the third-
largest ERP software vendor. In 1997, its share of the ERP market was 7 percent, and
in 1998 its revenues exceeded $1.3 billion U.S. dollars. PeopleSoft’s ERP system can
be scaled to accommodate from 10 to 500 users. PeopleSoft has become known for
having the broadest human resources module. In many cases, firms have adopted
the human resources module from PeopleSoft and the other modules from other
ERP vendors. In some cases, the quality of its human resources module led some
clients to adopt the rest of PeopleSoft’s ERP modules. PeopleSoft is a U.S. company.
Oracle is the second-largest supplier of ERP software in the world; however, it is
perhaps best known for its database system and not its ERP software. Oracle was
founded in 1977 in the United States. Oracle’s ERP applications were developed for
the U.S. market in 1989 and for the international market in 1993. In 1997, Oracle
announced that it was going to market to specific industries and improve the inter-
national characteristics of its software. Oracle’s ERP market share in 1997 was 13
percent, and its 1998 ERP revenues were $2.4 billion U.S. dollars. Oracle’s ERP soft-
ware can accommodate over 1,000 users. Oracle’s reputation in ERP systems is for
developing a product that can be easily interfaced with modules of other ERP sys-
tems. Oracle was the first ERP vendor to make its ERP system compatible with the
Internet.
The largest market share for ERP software is held by Systems, Applications, and
Products in Data Processing (SAP, which is pronounced S-A-P), with estimates
ranging from 40 to 60 percent. Five former IBM analysts founded SAP in 1972 in
Mannheim, Germany, because they wanted to develop and market standard soft-
ware that would integrate business processes, to process data interactively and
have it available in real time, and to have users to work with data on a computer
screen, and not with voluminous printed output.
In 1979, SAP released its first commercial ERP software, called R/2, which oper-
ated on mainframe computers and integrated financial and operational data into a
single database. In 1994, SAP released its next generation ERP software, called R/3,
which exploited the increasingly popular client/server architecture. Specifically,
SAP R/3 was implemented using a three-tier client/server network. In 1997, SAP’s
revenues exceeded $5 billion U.S. dollars, and by 2002 its revenues reached $8 bil-
lion U.S. dollars. SAP is known for spending about 20 percent of its sales income on
research and development. In 2002, SAP had more than 28,000 employees and
more than 12,000 customers in 107 countries, and had sold more than 22,000 instal-
lations of its ERP software. Reportedly, SAP R/3 can be scaled for between 25 and
1000 users. The client/server-based SAP R/3 is being gradually transitioned to a
Web-based architecture called mySAP.com.
ERP firms do not implement all the software that they sell; instead, they work
with a wide variety of partners that do so. For example, SAP has four types of part-

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