The medical device industry requires unique capabilities in an ERP system. In fact, the industry contains two major groups. The first segment produces consumables, while the second one builds large CapEx equipment such as medical imaging and cancer machine. These groups follow different processes such as sales, manufacturing, and FDA. The FDA processes, in particular, vary depending on whether the device is used for diagnosis or surgery. So the quality and regulatory needs might vary for companies. And that drives the features and processes these companies need in their ERP systems.
The most critical features for medical device companies include the process for electronic signatures and device history records. The other features, such as vendor approval and end-to-end traceability, are similar to aerospace and automotive industries but with some more restrictions. The validation requirements might require you to validate the software with each change but might not apply to every company. There might be further complications with the CRM processes as the different markets may follow different timelines and require controls with your quoting process. You are only scratching the surface of the features medical device companies need.
So which are the ERP systems that are most suitable for medical device companies? How about we start with the top 10 medical device ERP systems? To finalize this list, we have analyzed hundreds of ERP systems and their capabilities through publicly available information. The list also relies on our teams’ experience in evaluating these ERP systems for our customers. The purpose of this article is not to recommend them but to provide you with some options that you can vet further as per your unique requirements.
Criteria
- Definition of a medical device company. These are the medical device ecosystem companies, including large medical equipment manufacturers, consumable manufacturers, diagnostic companies, and CROs. The list considers companies of all sizes in this ecosystem.
- Overall market share/# of customers. The higher the market share among medical device companies, the higher it ranks on our list.
- Ownership/funding. The more committed the management to the product roadmap for the medical device companies, the higher it ranks on our list.
- Quality of development: (legacy vs. legacy dressed as modern vs. modern UX/cloud-native). The more cloud-native capabilities, the higher it ranks on our list.
- Community/Ecosystem. The larger the community with a heavy presence from medical device companies, the higher it ranks on our list.
- Depth of native functionality for specific industries. The deeper the publisher-owned out-of-the-box functionality, the higher it ranks on our list.
- Quality of publicly available product documentation. The poorer the product documentation, the lower it ranks on our list.
- Medical device company market share (and documented commitment of the publisher through financial statements). The higher the focus on medical device companies, the higher the ERP system ranks on our list.
- Ability to natively support diversified business models. The more diverse the product, the higher it ranks on our list.
- Acquisition strategy aligned with medical device companies. The more aligned the acquisitions are with the medical device companies, the higher it ranks on our list.
- User Reviews. The deeper the reviews from medical device companies, the higher the score for a specific product.
- Must be an ERP product. It can’t be an edge product such as QuickBooks, Freshbooks, Xero, Zendesk, HubSpot, or Salesforce. It also can’t be an add-on owned by ISVs or VARs that sits on top of other accounting platforms.
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10. Rootstock
Targeting smaller discrete medical device manufacturers, Rootstock is ideally suited for companies in the $10-$100 mil range – that are heavy Salesforce users. Not a fit, though, for companies that might require deeper financial controls and large companies with over $100 million in revenue.
Strengths:
- Native Integration with Other Salesforce Products. Its strength Includes native integration with other Salesforce products such as Salesforce CRM and Field Service. Salesforce CPQ and commerce are especially strong for medical device companies that care for enterprise-grade territory management and customer experience.
- Cloud-native Mobile Capabilities. Inheriting native mobile capabilities from the Salesforce platform and being born in the cloud, it is strong with native cloud mobile capabilities. It’s WMS mobile capabilities are especially attractive such as cross-docking, license plate number, and QR-code support. These capabilities typically require a specialized WMS solution.
- Mixed-mode Manufacturing Capabilities. Finally, its strength includes mixed-mode manufacturing capabilities similar to other more robust manufacturing solutions. But it might not have finite scheduling capabilities.
Weaknesses:
- Finance and Accounting. Rootstock started as the MRP solution and relied on other accounting solutions. They have recently developed accounting capabilities, which are not as strong as other products on this list.
- Reliance on Third-part Quality Module. Relying on other solutions in the Salesforce ecosystem, such as ComplianceQuest, Rootstock does not own a quality module.
- Smaller Ecosystem. The ecosystem is relatively small for rootstock with less than 500 installations. This could pose a risk in finding talent for future support and customizations.
Recent updates? No announcements, that directly impact the capabilities of these industries. Also, due to the lack of momentum for these industries, we have downgraded it significantly yet it still maintains the ranks at #10 on our list of the top medical device ERP systems.
9. SYSPRO
SYSPRO targets small distributors and manufacturers with a heavy focus on food and beverage distributors. As it can also support formulation management and process manufacturing features, it’s a unique product in its category. The other vanilla discrete ERP systems might struggle in supporting business models as diversified as distribution, discrete, as well as process manufacturing. With an “SAP” feel to the product., SYSPRO has solid finance and distribution capabilities. Not only the feel is similar to SAP, but the features such as activity-based costing and complex UoMs are also comparable to SAP products as well.
Strengths:
- Inventory and Supply Chain Capabilities. Its strengths for medical device companies include its substantial inventory and supply chain capabilities.
- Medical Device Quality Requirments. The other bonus points for SYSPRO include its ability to support electronic signature capture, CAD integration, and detailed audit trails of the transactions critical to support FDA 21 CFR 11 and GMP requirements.
- Native Support for Process Manufacturing Capabilities. Finally, the other plus point for SYSPRO would be its native support for process manufacturing capabilities. These features will be helpful for companies such as contract research organizations or laboratories that might develop drugs along with devices.
Weaknesses:
- Fit for Companies with One Legal Entity. designed primarily for smaller manufacturing facilities with one legal entity.
- Limited Manufacturing Capabilities. deeper manufacturing features, such as line-level backflushing for both material and operations and Kanban, would be a challenge.
- Not a Fit for Large Capital Equipment Medical Device Manufacturers. Not designed for complex capital equipment devices such as radiology or cancer machines.
Recent updates? SYSPRO has not announced any capabilities that directly impact the capabilities of these industries. But it still maintains the rank at #9 on our list of the top medical device ERP systems.
8. Deacom
Similar to SYSPRO, Deacom targets smaller process and F&B manufacturers. While Deacom is a small product, its cloud-native capabilities are impressive as it was born in the cloud. Deacom targets businesses that might be on QuickBooks and <$10 mil dollars in revenue.
Strengths:
- Technology. Deacom’s strengths for medical device manufacturers include its technology that has a modern interface and a SQL database. The other products in this category typically rely on file-based databases.
- Process Manufacturing Capabilities. The other plus points for Deacom would be the capabilities for medical device companies that are more of a drug/chemical company than a device company.
- Track and Trace and Route Accounting. Finally, its strength would also be in its native capabilities for track and trace and route accounting capabilities for medical device companies distributing fast-moving goods such as sanitizers or surgical masks on their vehicles.
Weaknesses:
- Not a Discrete Manufacturing Product. It will struggle with companies requiring complex discrete manufacturing features such as CAD integration or multi-layered BOMs with thousands of components with change orders.
- Fit for Fast-moving Consumable Products. its native design is deficient for large capital equipment manufacturers as its costing and BOM capabilities will be extremely limited for them.
- Limited Finance and Supply Chain Management Capabilities. Limited finance and supply chain capabilities, such as complex UoM, deep pricing and discounting support, and 1:N capabilities as they relate to the orders, shipments, and invoices.
Recent updates? Deacom has not announced any capabilities that directly impact the capabilities of these industries. But it still maintains the rank at #8 on our list of the top medical device ERP systems.
7. Oracle Cloud ERP
Oracle Cloud ERP targets large medical device manufacturers with more than 20-30 entities and more than $1B in revenue. Suitable for companies that prefer financial control in the ERP system over operational capabilities at the plant level. Equally solid for organizations that plan to develop the core medical device manufacturing compliance and regulatory capabilities on top of the core platform.
Strengths:
- Core ERP Capabilities. One of the largest ERP solutions in the market, with deep capabilities in supply chain and logistics provided as part of the core solution.
- Best-of-breed Capabilities. Its strength also includes its best-of-breed capabilities with solutions such as HCM and marketing automation.
- Financial Control and Public Company Capabilities. Financial control capabilities required for larger and public companies, such as SOX compliance, financial traceability, and month-end close collaboration across entities.
Weaknesses:
- Medical Device Last-Mile Functionality. Limited last-mile functionality applicable for medical device manufacturers, such as device history records, reporting for FDA 21 CFR 11 and GMP, and electronic signature and skill certification processes embedded with each operational step.
- Longer Configuration and Customization Time. Longer time in customizing and configuring as the software design may consist of unnecessary allocation, commitment, and approval functionality for large companies.
- Not as Relatable for Plant Level Employees. Finally, the product may appear bloated for plant-level employees due to the missing operational perspective. Also, enabling this perspective may require unnecessary development and testing time.
Recent updates? Oracle Cloud ERP has not announced any capabilities that directly benefit the capabilities of these industries. Yet it still maintains the rank at 7 on our list of the top medical device ERP systems.
6. Microsoft Dynamics 365 Finance & Operations
Microsoft Dynamics 365 F&O targets large medical device manufacturers with more than 20-30 entities and more than $1B in revenue. Pre-integrated with the leading MS CRM known for its tighter object model to accommodate global controls such as restricting sales for a product in specific regions. Its integration is unique and superior as the products such as filed services are pre-integrated at the database layer.
Strengths:
- Core ERP Capabilities. Its strength includes the core ERP capabilities such as native support for mixed-mode manufacturing, including deep process manufacturing such as formulation management, catch weight management, approvals, and commitments.
- Best-of-breed Capabilities. Its strength also includes its best-of-breed capabilities with applications such as pre-integrated CRM and field service components.
- Technical Architecture. The technical architecture includes integration with other Microsoft products such as Logic Apps and Azure Data Factory. This architecture allows companies to deploy all of their applications on the Azure data center and manage them in one private instance to reduce their validation costs if applicable.
Weaknesses:
- Medical Device Last-Mile Functionality. Its weaknesses include limited last-mile functionality applicable for medical device manufacturers, such as device history records, reporting for FDA 21 CFR 11 and GMP, and electronic signature and skill certification processes embedded with each operational step.
- Customizability. Since MS products are highly technical and customizable in nature, it could pose control issues for companies if developers over-customize these products with limited visibility for financial executives.
- Implementation Control. Since Microsoft sells licenses in the OEM setting with a limited governance process in place, buying these products from unqualified resellers fires back and may lead to ERP implementation failure.
Recent updates? Microsoft Dynamics 365 F&O has not announced any capabilities that directly benefit the capabilities of these industries. Yet it still maintains the rank at #6 on our list of the top medical device ERP systems.
5. Epicor Kinetic
Epicor Kinetic targets mid-market discrete medical device manufacturers. It would be suitable for lighter assembly-centric medical device manufacturing companies with a focus on vendor collaboration and supply chain. Not as suitable for medical device manufacturers with complex equipment and quality and compliance needs.
Strengths:
- Mixed-mode manufacturing capabilities. Epicor Kinetic is one of the most robust mixed-mode manufacturing products. The product model can accommodate several manufacturing processes for discrete manufacturers such as Kanban, configure-to-order, make-to-order, and make-to-stock.
- UX Experience. Unlike its legacy counterparts, such as Infor CloudSuite Industrial, the UX experience is superior in the cloud today. The architecture also has the edge over other legacy ERP vendors and can support more complex cloud-native features such as the advanced search for data or forms.
- Last Mile Medical Device Capabilities. its strength also includes the last-mile functionality for medical device manufacturers, such as electronic signature support through MES and track and trace capabilities starting from raw material through post-sale.
Weaknesses:
- BOM Data Integrity. Its weaknesses include its legacy BOM data structure for assembly-centric organizations. And because of these issues, medical device manufacturers building large capital equipment might face challenges with data corruption with products with multiple sub-assemblies and thousands of components.
- Third-party Quality Module. Its weakness also includes its reliance on the third-party quality module, limiting the tighter integration of the quality processes that medical device manufacturers need.
- Weaker Configurator. Finally, its configurator is not as strong as its other closer competitors, such as Infor CloudSuite Industrial. It doesn’t allow you or the customer to visually see the changes applied during the configuration process.
Recent updates? Epicor Kinetic has announced several acquisitions such as cloud-based MES, configurator, and field services capabilities from Evron but they might not have a direct impact on the capabilities of this industry. Yet it still maintains the rank at #5 on our list of the top medical device ERP systems.
4. SAP S/4 HANA
SAP S/4 HANA targets large medical device manufacturers with >10-20 entities and >$1 billion in revenue. Therefore, SAP S/4 HANA is suitable for organizations with deep financial control needs, such as public companies. Not suitable, though, for smaller companies that need deeper operational functionality at the plant level.
Strengths:
- Superior Financial Control and Governance. Its strength includes the inbuilt visual workflow for each financial transaction, superior change control of the ERP configurations, and SOX compliance approval flow.
- Product Model Designed to Support Various Manufacturing. SAP’s product model is rich and supports various configurations, including mixed-mode manufacturing. As a result, the BOMs are not as limiting as they would be with Epicor Kinetic or NetSuite.
- Best of breed solutions. several solutions, including SAP Hybris for e-commerce for medical device companies and Callidus Cloud for CPQ. SAP also has a robust WMS and TMS solution packaged as part of SAP EWM and SuccessFactors for HCM capabilities.
Weaknesses:
- Integration Challenges with Best-of-breed Solutions. While SAP S/4 HANA has one of the best best-of-breed solutions for larger medical device manufacturers, they might not be as pre-integrated as other solutions.
- Overbloated Customizations and Controls for Smaller Organizations. As with other larger products on this list, the controls provided as part of the product may feel unnecessary and overwhelming for smaller companies. In addition, they may add additional development and testing time to disable them.
- Last-mile Medical Device Manufacturing Capabilities. Last-mile medical device manufacturing functionality such as FDA reports, 21 CFR 11, and device history records functionality would require expensive customizations.
Recent updates? SAP S/4 HANA has not announced any capabilities that might have a direct impact on the capabilities of this industry. Yet it still maintains the rank at #4 on our list of the top medical device ERP systems.
3. Infor CloudSuite Industrial
Infor CloudSuite Industrial targets small to mid-sized medical device manufacturers with fewer than ten entities. It’s especially suitable for large equipment manufacturers with thousands of dependent components and sub-assemblies. Not as suitable for companies that are primarily distributors and may perform lighter manufacturing or assembly.
Strengths:
- Designed from the Perspective of OEMs. Supports serializable units composed of other serialized components to provide a complete view of the device history.
- Quality Module Owned and Pre-Integrated. The quality module is deeply integrated and maintains a separate inventory for the quality-controlled components with deep coverage for in-process quality.
- Strong Field Service Capabilities. When several players may be involved in the sales and service transactions including the scheduling of internal or external resources. As well as sharing compensation depending upon the level of effort from all parties involved.
Weaknesses:
- Poor UX and Legacy Feeling. The interface not as cloud-native as some of its legacy counterparts, with critical limitations such as advanced search capabilities.
- Not Suitable for Distribution-centric Medical Device Manufacturers. The product design is limited for manufacturers. However, the distributors that perform lighter manufacturing but may have deeper distribution needs such as Supply Chain network planning or decentralized warehouse architecture may struggle with the product.
- FDA- and Medical Device-Specific Regulatory Capabilities Not as Strong. Its weaknesses also include the efforts required in developing regulatory compliance reports and capabilities needed for medical device manufacturers
Recent updates? Infor CloudSuite Industrial has acquired the MES solution, which would be a great value add for medical device companies seeking industry4.0 capabilities. But the diverse medical device companies with diverse business models might struggle with Infor CloudSuite Industrial because of the limited support for distribution, CapEx, and process-centric processes. Yet it still maintains the rank at #3 on our list of the top medical device ERP systems.
2. QAD
QAD targets upper-mid to large medical device manufacturers. It is especially suitable for companies that need global supply chain capabilities to collaborate with international vendors. Not as suitable for companies that care for larger ecosystems and vendor support for the product.
Strengths:
- Supply Chain Perspective. Designed from the perspective of the Supply Chain and is probably the only mid-market product with deeper transportation management. As well as international trade management capabilities.
- Last Mile Medical Device Capabilities. The last mile medical device capabilities such as automated quality management, serialization in support of unique device identification (UDI), the Drug Quality and Security Act (DQSA), and the Falsified Medicine Directive (FMD).
- Mixed-mode Manufacturing Capabilities. Its native discreet and process manufacturing capabilities and forward and backward recall traceability.
Weaknesses:
- Ecosystem. QAD is not as well adapted as some other products on the list and does not have as prolific a VAR ecosystem as Microsoft, SAP, or Oracle.
- Technology and Underlying Technical Architecture. While its technology helps with the user experience, the programming language, and the underlying technology architecture are outdated. So external support and availability of talent may be a challenge with QAD.
- Not a Great Fit for Companies Developing Large Complex Capital Equipment. While the product has mixed-mode manufacturing capabilities, it’s not meant to support large complex capital equipment manufacturers’ products with thousands of dependent components and sub-assemblies.
Recent updates? QAD’s recent announcements have focused on building deeper supply chain capabilities that would traditionally reside in an S&OP platform. So medical device companies that are heavy on demand planning and supply chain may enjoy the platform. Yet it ranks at #2 on our list of the top medical device ERP systems.
1. Sage X3
Sage X3 targets large process manufacturers with limited discrete manufacturing capabilities compared to other solutions on this list. Therefore, while Sage X3 might be suitable for companies that might have products that might be more process Centric than discrete, it will not be suitable for hardware-centric companies.
Strengths:
- Process Manufacturing Capabilities. Its strength includes process manufacturing capabilities for companies such as laboratories and drug-like products instead of hardware devices.
- Deep Finance and Supply Chain Capabilities. Its strength also includes deep finance and Supply Chain capabilities, and the product is designed from the CFO’s perspective. This is helpful for large companies that need superior financial control and last-mile process manufacturing capabilities.
- Multi-entity Capabilities. Its strength also includes multi-entity capabilities that might not feel as natural as other manufacturing-centric products.
Weaknesses:
- Discrete Manufacturing Capabilities. Sage X3 has discrete manufacturing capabilities, but these capabilities may not be robust for complex equipment manufacturers.
- Third-party MES. Sage X3 does not have a pre-integrated OEM-owned MES component and would require integration and additional testing with third-party solutions with the legal and implementation risks due to multiple vendors involved.
- Last-mile Medical Device Manufacturing Capabilities. The last-mile medical device manufacturing capabilities would require additional development and testing, increasing the costs and risks for ERP implementation.
Recent updates? Sage X3 has not announced any capabilities that will directly benefit this platform But we have upgraded this list substantially because of the limitations of other solutions. And because of this, it ranks at #1 on our list of the top medical device ERP systems.
Conclusion
Due to the FDA compliance requirements and quality needs, medical device companies have very involved operations. To control the global release process of equipment, they also need deeper CPQ capabilities. Finally, developing a combination of drugs and devices or consumables and capital equipment requires mixed-mode manufacturing capabilities.
So you need an ERP system designed to support most medical device processes natively. Using an ERP system not designed for the medical device industry might require significant customizations. As well as an additional testing time for unnecessary configurations that may be prepackaged with other ERP systems. So make sure that the ERP system that you choose is designed for the medical device industry. And hopefully, this list can help you narrow down some options.
