As legacy systems were labor intensive to customize, most were developed with generic manufacturing in mind. Try to be all things to all people. If these generic systems had 80% of all manufacturers requirements, they could market to a large audience. All specific industries have unique business methods and use some unique terminology. Some of these specific industries include contract electronics, plastic injection moldings. Not finding exactly what they wanted in standard systems, some companies customized the systems they purchased to better meet their industry specific requirements. Some of these customized systems eventually were marketed to their specific industries.

The Attraction

These industry specific systems would include features and terminologies the generic systems didn't have. It is difficult for anyone to recognize the differences between ERP systems. These unique features stood out as differentiators to the companies evaluating systems, and the industry specific systems began to sell.

The Problem

The problem is that companies assumed the industry specific systems also included all the generic ERP capabilities, which wasn't always the case. As these industry specific systems had a smaller audience potential, new customers were few and far between. Software vendors finance their new product development with the software maintenance their customer base pays. A small customer base (under 1,000) means limited funds to develop the system and less customer feedback to evolve new ideas around. Having limited development funds, these industry specific systems focused their development around features their customer base would pay to custom develop.

Also these software vendors commonly have limited support staff. Answers to questions may take days, if ever to solve. Companies that gambled by purchasing these industry specific systems often found them wanting. Generic features such as accounting, material planning, etc. were found to be very weak and sometimes non-existent. Causing some customers to abandon them and re-purchase generic systems. This customer exodus only added grease to the skids to the lack of development of these systems.

Why are these Industry Specific systems not as popular today?

Today systems are easily modified without customizing. Unique requirements and terminology can be incorporated into the Generic systems, so companies can have the best of both worlds. Not all Industry specific systems are dead though. Some of them have been able to continue their product life by drastically lowering their software costs. Potential customers naively purchase these apparent good deals without realizing the pitfalls until after they have implemented.

The school of hard knocks can be an expensive method of selecting software.