SYSPRO U.S. Provides Critical Visibility with Voyage & Container Tracking

Mobile, Cloud or On-Premises Supply Chain Management

In a world where international shipments are so commonplace, it is amazing how many global manufacturers and distributors lack visibility of goods that are in transit, often for weeks at a time. Even though the ownership of purchased goods transfers as soon as a container is closed, for most, particularly for small to medium-size businesses (SMBs), materials simply disappear into a black hole, before they (hopefully) are received from half a continent or half a world away. To solve this problem, and also add visibility to shipped products, SYSPRO U.S. has added a new Voyage & Container Tracking solution to its portfolio and made sure it is fully integrated with its enterprise resource planning (SYSPRO ERP) software and complemented with useful analytics. This is perfectly consistent with its “Einstein” market positioning favoring “simply smarter” solutions for what the mid-market customer actually needs, versus simply succumbing to industry hype.

A Real Solution for a Real Problem

Once upon a time, in the not-so-distant past, globalization was the domain of large, multi-billion dollar enterprises. Yet today, almost every company, regardless of size, trades internationally. Low cost country sources have sent even small manufacturers and distributors in search of lower cost materials and small companies themselves have become more distributed. The 2014 Mint Jutras ERP solution study found 66% of all manufacturers operate from more than one location and even small manufacturers (those with annual revenues less than $25 million) have an average of 1.6 operating sites (Figure 1). These types of changes in the business environment have brought an unprecedented level of complexity to supply chains and those supply chains extend across the globe.

Long lead times add uncertainty, which is difficult for any company to deal with, but particularly so for small to medium-size companies that have fewer resources and less clout with their customers — customers which often are very large and demanding. Yet shipment tracking, accurate determination of true landed costs and visibility into where goods are and where they are coming from, have typically been features only available in specialized software packages that are well beyond the reach of an SMB.

Figure 1: Even small companies operate globally

SYSPRO fig 1Source: Mint Jutras 2014 ERP Solution Study

Note: Size is based on annual revenue

SYSPRO U.S. turned to its customer base to help define and design the features and functions required to close this gap in visibility and then it spent the last two years refining it with the assistance of one company in particular: Wormser Corporation, a privately held cosmetics manufacturer and distributor based in Englewood, New Jersey. Wormser’s biggest challenge was in tracking shipments from its manufacturing location in Shanghai to its 40 warehouses in the United States.

Three Major Components

The embedded features of SYSPRO U.S.’s new Voyage & Container Tracking solution are delivered through three major components.

  1. Release Matrix: This component identifies and manages items that are available for shipment through a multi-part release operation. Items included in both purchase orders and sales orders can be combined in a single release. Users are provided visibility into what is available and can adjust quantities and view expected departure and delivery dates.
  2. Container Management: This component is used to determine which products or parts will travel in which containers. It provides the flexibility to consolidate releases from multiple orders into a single container or split a single order across multiple containers. While today the solution does not explicitly manage the capacity of each container, it does provide visibility into container usage. SYSPRO U.S. plans to enhance this capability in the future to include optimization of containers. Through the assignment of goods to these containers, the SYSPRO customer gets added visibility and predictability of departure and arrival dates as well as source and destination ports.
  3. Disposition Management: When a container reaches its destination, this component takes over. Each container may be processed separately or all containers on a voyage can be handled as a single shipment. Upon arrival at a port, the goods in the containers may be placed on quarantine hold or transferred to another segment of the journey (e.g. from ocean vessel to truck) for delivery to the next or final destination. This component performs the inventory and fiscal transactions necessary and provides more visibility. Charts and graphs are useful in analyzing elapsed time between ports, management of the number of containers shipped and landed costs.

These charts are just some of the analytical tools provided. SYSPRO U.S.’s survey of a sample of its own customer base convinced the solution provider that the vast majority of its customers found messaging within the enterprise software industry about “big data” and analytics either difficult to understand or only somewhat understandable.

Yet the lack of understanding does not mean there is no value in these types of analytical tools. It simply means small to mid-size manufacturers and distributors need help in understanding how to leverage these tools. And it also means they will only be receptive to learning more if the tools solve a very real and practical problem. They are not interested in elegant technical solutions in search of problems. They have plenty of problems of their own to solve.

Potential Benefits

The potential benefits of SYSPRO U.S.’s new solution should be very appealing to these pragmatic manufacturers and distributors. The potential benefits include:

  • The ability to track shipments both at an order line level, as well as a summary level. This tracking data will also be available for analysis for both strategic and operational decisions.
  • Better visibility to inventory, even with long lead-time items. This visibility will be helpful in improving full, on time delivery.
  • The ability to analyze performance by product origin through the recording of departure and arrival cities and individual ports.
  • Better vendor performance management through more detailed measurement of promised and actual shipments.
  • Full determination of not just material costs, but full landed cost, whether free on board (FOB) or not.
  • Improved communication and collaboration between departments, locations, and vendors, along with fewer mistakes.
  • A single source of the truth. Because of the seamless integration with SYSPRO ERP, all shipping and financial data is combined in a single source of data.

Proof Positive: Wormser Corporation

With six locations around the world, Wormser Corporation’s biggest challenge was in tracking shipments from its manufacturing location in Shanghai to its 40 US-based warehouses. All these different locations were using different systems and ultimately Wormser turned to SYSPRO for a full and integrated solution for its global operations. SYSPRO ERP was a great fit for daily operations, but Wormser approached SYSPRO U.S. for a custom tracking module for overseas inventory tracking. This was the genesis of the voyage and container tracking system now being released as a standard offering.

In October 2012, Wormser’s six international locations (New Jersey, California, Texas, England, Germany and China) went live with SYSPRO ERP and the newly- developed intercompany modules. All supply chain transactions between entities were automated. In addition Wormser tracks partial and full container shipments from vendors.

By collecting all this data, from all these locations, as well as from vendors, Wormser is able to produce analytical reports and graphs that aid in comprehensively managing a complete supply chain. Analysis can be done at an order line level, all the way up to and including location and the full company. Vendor performance is also tracked and Wormser now has data for strategic, as well as operational decisions.

Summary and Key Take-Aways

This new Voyage & Container Tracking solution provides an enormous opportunity for many of SYSPRO U.S.’s customers. Any that deal with long lead times, complex supply chains and/or international, containerized shipments can potentially derive a lot of value from this newest solution. And as a SYSPRO U.S. offering, it is both affordable and pre-integrated to the SYSPRO ERP solution being used to manage back and front offices across the installed base of SYSPRO U.S. customers around the world. By infusing analytics into the solution, it becomes a potentially powerful tool for decision-making – both from an operational and a strategic decision-making perspective. With this new option, SYSPRO U.S. companies faced with real supply chain challenges, particularly those with multiple locations, can gain new efficiencies with real solutions.

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SAP Business One Emerges as the SMB ERP Solution to Beat

If you are a small to mid-size business (SMB) faced with a decision about Enterprise Resource Planning (ERP), SAP Business One is likely on your radar. Even if your initial search did not result in placing SAP’s solution on your short list, chances are one of its competitors has brought it to your attention by attacking either SAP or Business One, or both. Why? Just like political attack ads that go after the front-runner, ERP vendors go on the attack against the industry leader. By sheer numbers, SAP is the largest enterprise solution vendor and over 80% of its 263,000 customers are in the small to midsize bracket. With over 45,000 SAP Business One customers, this solution might be an easy target, but it is not going to be easy to beat.

The rationalization, “Nobody ever got fired for choosing [insert front runner here]” doesn’t work for ERP, leastwise for ERP in a small company when it is usually the top boss signing off on the decision. All 45,000 SAP Business One customers could not have been “wrong.” And let’s face it: If you want to make an informed decision about a solution, you don’t go to the competition for the facts. Competitors often get the facts wrong and propagate rumors, myths and misinformation. Any comparison the competitions’ sales/marketing teams offer is often driven by wishful thinking and influenced by drinking their own Kool-Aid. To examine some of those assertions, along with some facts, click on the link below.

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Elysian Field Software will Broaden Epiphany’s Reach

Robust Field Service and HR/HCM Cloud Solutions

The launch of any new company is exciting, but even more so when it is launching from a foundation that is already stable, well-built and primed for growth. Epiphany, an early pioneer in Software as a Service (SaaS), founded in 2002, is a well-established NetSuite value added reseller that offers both NetSuite’s Enterprise Resource Planning (ERP) solution as well as its own comprehensive solutions for field service and human resource/human capital management (HR/HCM). At the December JRocket Marketing Winter 2014 Analyst Roadshow, Epiphany announced plans to launch a new company, Elysian Field Software.

This announcement represents far more than just a name change and rebranding effort. Epiphany will become a division of the newly formed enterprise, Elysian Field Software. While Epiphany will continue to serve the NetSuite community with an integrated suite approach, a brand new sister division, Elysian Field Services wil serve a broader market. Taking a “best-of-breed” approach it will offer comprehensive, affordable, cloud-based solutions to those running other ERP solutions, but suffering from gaps so often found in field service and HR/HCM functionality.

Epiphany: A Great Starting Point

Epiphany’s business will not change; it will continue to resell NetSuite’s ERP and serve the broader NetSuite community with tightly integrated, “best-of-breed” extensions. With 114 NetSuite deployments to date, Epiphany is one of the larger channel partners of NetSuite. The two companies have evolved over the years, as have their products. Looking at the NetSuite product through the eyes of their customers, Epiphany found some gaps in terms of field services and HCM. Using the NetSuite development platform Epiphany filled those gaps, and not just in a superficial way.

These extensions to NetSuite have grown into very comprehensive suites for field service and for human capital management that rival the most robust packages in comparable markets today. Typically these types of robust solutions are outside the budgets of small to medium size businesses, but Epiphany has been making these solutions affordable to even small customers since the early NetSuite days when most customers were just graduating from QuickBooks. Of course the average NetSuite customer has grown substantially over time, but Epiphany still serves the lower end of the spectrum (as well as larger companies) with products that could rival many of those sold into much larger enterprises.

About a year ago NetSuite acquired TribeHR, which brings a unique approach to the recruiting process and is integrated with NetSuite ERP in that it adds and provisions the employee upon hire. However, there is no natively built full HR/HCM solution. That’s what Epiphany brings to the table.

Human Resources/Human Capital Management Modules
These modules are currently sold as Epiphany products. While they will be re-branded under the Elysian Field Software label, they will also continue to be sold by Epiphany, along with NetSuite ERP.

  • Applicant Tracking: this is a comprehensive module that supports the entire process from Job description and requisitioning of positions, through screening and applicant processing, selection, employee record creation and on-boarding checklists.
  • Human Capital Management: supports “one click” hire process for setting up new employees, change management, separation, EEO data capture and organization charting.
  • Benefits: includes paid time off (PTO) management, Family and Medical Leave Act (FMLA) tracking, health insurance management and COBRA event management.
  • PTO: “Leave” management includes overview calendaring for all staff with group/subsidiary/location selections, including customizable color-coding, supervisor views, graphical portlets and dashboards.
  • Performance Management: Goals determination and tracking can include cascading goals, supervisor/employee synergies, Lominger Competencies assignment and performance review rating calculation methodology.
  • Compensation Management: Salary ranges, job grade assignments, employee change tracking and compensation conformance.
  • Manager Self Service: includes employee data, PTO requests, review/update employee qualifications, job description/requirement definition, open applicant management, selection of applicants and property distribution management.
  • Employee Self Service: for qualifications, certifications, skills, licenses, leave and PTO requests, performance review participation and goal management.
  • Third-Party Integration: Integration to career sites, compensation planning, organizational modeling, payroll, resume parsing, etc.
  • Customized Report/Search Templates: Pre-screening, scoring, posting success rates, time to fill analysis, cost per hire analysis and more.

 

Customers can choose to use TribeHR along with Epiphany’s modules, or rely exclusively on Epiphany for HR/HCM functionality.

Business Expertise to Get the Job Done: Mantra Teams

However human resources and HCM projects, particularly in smaller companies, are challenged in a rather unique way, beyond the typical budgetary constraints. Seldom can small companies afford to hire a seasoned veteran with experience in implementing comprehensive HCM solutions, leaving the implementation in the hands of younger workers with little experience in driving an implementation to completion. And of course when staffed with younger workers, companies may experience a higher degree of turnover in the position. And even if a small company can afford and attract a seasoned veteran, this HR leader must wear many hats and is often consumed by overseeing compliance requirements and handling the occasional personnel crisis, causing the implementation to stall.

After spending 12 years deploying enterprise cloud solutions at other firms, Epiphany CEO Brenda Brinkley observed many incomplete or functionally deficient solutions, as well as inadequate resources to take full advantage of more robust solutions, even when available. To address this she came up with a concept of what she calls “Mantra Teams.” Rather than leaving the implementation to full-time employees, these teams will be available on demand, on a contract basis.

The Elysian Field Mantra Teams will be largely full time consultants and/or retired HR/HCM professionals who are experts in the field, but available for as long or short an engagement as required. These experts will be:

  • Screened and vetted by Elysian Field Software for their expertise and understanding of HR/HCM best practices
  • Trained on how to use the software
  • Affordable because they will be contracted directly by the customer with no middle man mark up
  • Motivated by the customer’s priorities but able to advise on how best to leverage the solution quickly and efficiently

In other words, this is a team of experts that customers can bring in simply to get the job done expeditiously.

Addressing the Complexities of Field Service

While HR/HCM modules are a big part of Epiphany’s business, remember it also provides a comprehensive suite of field services management modules as well. NetSuite’s early successes centered on professional services businesses, then moved into distribution and light manufacturing. It has been very successful in attracting manufacturers of consumer products, but has more recently targeted manufacturing of more industrial products. With this move, repair and maintenance of manufactured products becomes more complex. And again, Epiphany filled a functional gap with a robust, integrated suite of Field Service Management Modules.

Field Services Management Modules
These modules are currently sold as Epiphany products. While they will be re-branded under the Elysian Field Software label, they will also continue to be sold by Epiphany, along with NetSuite ERP.

  • Work Order Management: technician/equipment assignments, time/expense/part tracking, rapid billing and mobile management
  • Rentals Management: pricing rates, equipment repair, pick-up/return, route delivery management, time utilization of rental assets, financial utilization of rental assets, fleet age and apportionment, inventory management
  • Depot Repair: Parts/returns/repair, advanced replacement, warranty visibility, repair orders with equipment tracking and inventory availability
  • Job Costing: job profitability, work in progress, cost and profitability reporting
  • Contract & Warranty Management: auto-create and renew contracts, manage service contracts, co-terminate multiple contracts, revenue and profitability tracking, manufacturer and custom warranty tracking, convert warranty to contract, bill warranty overages
  • Scheduling & Dispatch: dispatch center, drag and drop technician scheduling, non-sequential work order scheduling, team scheduling, PTO, schedule by skill and availability
  • Technician Skill Management: skills, licenses, education & certifications, qualifications, tied to HR
  • Mobile Tech: offline and online, calendar view, daily & weekly expenses, signature capabilities, attachments, complete view of configuration, tasks, contracts, notes, photos, time, expenses, etc.

 

Field service solution implementations also have the potential of suffering from lack of fully functional solutions and also lack of attention. Not only has Epiphany made a robust solution to a complex problem quite affordable, but it also wants to address what might be a “commitment issue.” While a good field service department is likely to have deep and broad expertise, the very nature of the job means the customer is always the first priority. This makes a software implementation even more challenging. As a result, Elysian Field also intends to add Mantra Teams for Field Service deployments.

And these teams of seasoned experts will also pave the way for introducing more leading edge technologies into the field. Elysian Field intends to aggressively pursue “machine to machine” capabilities, supporting the concept of the “internet of things (IoT)” and new technologies such as 3D printing and mobile wearable devices. While these types of technologies might seem like “pie in the sky” overkill for some industries, they are particularly relevant for field service. Think what a portable 3D printer could do to supply repair parts in the field. Think about the value of providing diagnostics or schematics built right into safety glasses, leaving the technicians’ hands free to trouble shoot and repair. Think about the possibilities of remote diagnostics by tapping into machine data.

Beyond NetSuite

While all these existing products and new plans are potentially exciting for NetSuite customers, Elysian Field Software would like to bring these exciting capabilities to a broader audience – hence the new sister division to Epiphany. This could spell a huge opportunity for the newly formed umbrella company. While the HR/HCM modules could be a good fit for virtually any NetSuite customer, today the Field Service Management modules are a better fit for NetSuite’s target manufacturing customer, rather than its current installed base. Making these modules ERP-agnostic represents a huge opportunity for Elysian Field Software.

However, it also represents a technical and development investment. Currently Epiphany’s solutions are built with the NetSuite development platform. It is very likely that Elysian Field Software will need to re-architect these solutions on a different platform to best meet its goals. Will this be Salesforce’s Force.com platform? Will it remain on NetSuite’s? Will it use another, different platform? Right now, Elysian Field Services is evaluating all different possibilities and has not ruled any out.

But given the effort involved, is it worth it? Is there sufficient market, beyond the NetSuite base to merit such an investment? Mint Jutras believes it is, provided Elysian Field Services chooses wisely and brings the new product to market fairly rapidly. New technology and rapid application development tools will be key, as the market will not patiently wait. The vast majority of companies have a strong preference for an integrated end-to-end solution. However, for every company that has an overriding preference for a tightly integrated solution from a single company, two will not sacrifice functionality for ease of integration or dealing with a single vendor (Figure 1). The best of both worlds obviously will be robust functionality that is easily and seamless integrated.

Figure 1: Preferences for a Suite?

Elysian fig 1Source: Mint Jutras 2014 ERP Solution Study

Both field service and HR/HCM functions have historically been underserved in smaller companies. The Mint Jutras solution study found only a 42% adoption rate of any kind of after market service functionality installed in manufacturing companies, and where installed, it was twice as likely to be a separate application that was loosely integrated or not integrated at all (28%) versus embedded or tightly integrated (14%).

HR capabilities were more pervasive at 66%, but this adoption rate did not distinguish between a robust suite and marginal HR capabilities, but still those not well integrated by a wide margin.

2015: A Year of Transition

As talent management, both in house and in the field continues to grow in importance, if Elysian Field Services can fill those gaps, and also provide seamless integration, not just to NetSuite’s ERP, but to other players in the small to midsize market, it should be a winning combination. Watch for some important milestones in 2015, including an official launch of Elysian Field Software in the second quarter, followed by the choice of a new independent platform.

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Catching Up with Deltek’s Race to Capture the World of Projects

In November I got a chance to catch up with Deltek, a company that pretty much coined the term “project-based ERP.” It is a company that develops and delivers enterprise software and information solutions for project-based businesses. My last real interaction had been back in 2010 when the company acquired Maconomy. Since then a lot has happened. It has:

  • Expanded globally, led primarily by Maconomy’s strength in Europe
  • Acquired Acumen and its set of tools to facilitate project planning, along with performance risk analysis
  • Moved three of its products to the cloud: Vision and Maconomy (although both are still available on-premise), and most recently Costpoint
  • Almost doubled in size and has gone private
  • Acquired Sohnar and its Traffic LIVE cloud-based resource planning solution for creative marketing communications agencies
  • Acquired Axium, bringing A&E solutions to smaller, non-government organizations
  • Gone mobile with Maconomy Touch
  • Gone social with Kona project collaboration tools
  • Introduced a new user experience including Maconomy Navigator
  • Launched a new, cloud-based next generation CRM to power the front office of project-based businesses

All these activities bode well for Deltek to continue its growth, bolstered by what Mint Jutras sees as tremendous opportunity for project-oriented software. The Mint Jutras 2014 ERP Solution Study captured the “top five” areas survey respondents were most likely to invest in next. Project Management ranked #1 overall with 22% of almost 800 respondents selecting project management.

But it is project-based businesses that present the most opportunity for Deltek. These project-based businesses span a wide range of industries, from project-based manufacturing like aerospace and defense (A&D), to architectural and engineering (A&E) firms, to professional services organizations (PSO) to marketing communications agencies. While these businesses all share a common thread of projects, they are actually very different types of businesses. And Deltek has different products to address each.

As Deltek continues to grow, expanding both geographically and also stretching the boundaries of its solutions, the trick will be to effectively scale its business. Each of its products addresses a different type of project-based business, so product road maps need to be tailored to individual industry needs. At the same time Deltek would be well advised to leverage certain tools such as Kona and CRM across multiple product lines to better leverage its development efforts across different product lines and different segments of its customer base.

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SAP Leverages the “Power of Big” to Benefit SMEs

Some common myths and misconceptions in the world of ERP are hard to kill, particularly when competitors and pundits just won’t let them die. Among these common myths is the perception that SAP is just for the big guys. Yes, the SAP Business Suite and even some predecessors to the Suite are installed in a large percentage of the Fortune 500. And yes, some of them cost millions of dollars and took many years to implement. Of course there are some horror stories, but I would argue those exist for any major ERP vendor.

I have to admit, during my 30+ years of working for software companies (but never for SAP), I might have encouraged some of those misconceptions, just as SAP’s competitors do today. But now, as a recovering software executive turned data junkie, I tend to look beyond the rumors and misperceptions. I go for the facts. Here are a few that are hard to argue with:

  • SAP has about 263,000 customers
  • 80% of them fall in the small to mid-size (SME) bracket. Do the math. The answer is 210,400.
  • SAP does not sell just one product. There is the Business Suite, but also SAP Business One and SAP Business ByDesign (no it is not dead or dying). SAP Business All-in-One is the Business Suite repackaged, by industry, for medium size businesses. You might choose to call it a different product or not, but it really matters little. Repackaged with best practices included, it makes the Business Suite more attractive to smaller (but not too small) companies.
  • SAP Business One, which addresses the lower end of the SME market, is installed in over 45,000 small businesses.
  • SAP’s ecosystem of partners that support small to mid-size businesses is 700 strong and growing.

I am sure one of SAP’s goals for this year’s annual SAP SME Summit was (once again) to help dispel these myths and misconceptions. I am equally sure that SAP understands it will take more than just bringing together customers, press and analysts in its hip New York City office to counter these perceptions. Instead, it seems to be effectively leveraging its extensive resources in order to help small and medium size businesses. Here are a few of different actions it has taken recently:

  • SAP HANA 9 can now be run on less expensive hardware
  • Powerful data visualization tools are available with a copy of SAP Lumira, free to any SAP customer
  • Fiori apps, providing an intuitive and modern new user experience, are now included for free (with paid maintenance) with SAP Business All-in-One
  • A 0% financing program, designed specifically for small businesses, as well as SAP’s partners that sell directly to them. This is a “buy now, pay later” option that gives the small business free financing for 24 months, while the partner gets paid within 5 days.
  • A free connection to the Ariba Network, which connects over 1.6 million companies in 190 countries, allows the small business to list its products. Although the free version does not allow bidding and purchase from the site, this is an effective way for small businesses to reach a large potential group of buyers.

It takes a large company with deep pockets and extensive resources to be able to make these kinds of offers to SMEs. Yes SAP continues to be the 800-pound gorilla in the ERP space but that doesn’t mean it can leverage the “power of big” to the benefit of the little guy.

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Intacct Helps Customers Unleash Their own Super Powers through Innovation and partnerships

 

American Express and SalesForce Aid in Delivering Automation and Collaboration

Intacct Advantage 2014 in Orlando (November 9-13, 2014) drew a crowd of over 1,300 attendees, a record for the company’s annual customer and partner conference. The conference has grown, along with Intacct’s ecosystem and its revenues. Indeed, Intacct has doubled its subscription revenues over the past two years. Following the themes of automation, collaboration and insight, Intacct announced two new partnerships, both of which help its customers leverage innovation in order to unleash their own “super powers”.

Intacct has partnered with American Express Global Corporate Payments to automate and “seamlessly integrate commercial payments and working capital solutions into Intacct’s software.” Intacct Check Delivery Service is the first milestone delivered from the partnership, enabling businesses to send check payments to suppliers, without ever having to write a check, while automatically updating their general ledgers – all with a click of a button.

The second partner is Salesforce.com. Intacct Collaborate embeds Salesforce Chatter into Intacct to create a secure social layer across all finance processes. Have you ever gone in search of scribbled notes and “sent” emails or wracked your brain trying to remember a conversation about a customer, an order, a payment? Employees can now conduct “conversations” right inside Intacct’s application, attaching them directly to specific records such as customers, projects, invoices, purchase requisitions, journal entries, and more. And you don’t even have to be a Salesforce customer. Of course, if you are (and 60% of Intacct customers also use Salesforce), those conversations also get recorded right in Salesforce as well.

Focus on Finance, but….

Intacct describes itself as a “cloud accounting software company” and says it is “100% invested in meeting the needs of financial professionals.” But if you look closely at its solution portfolio, you actually find it satisfies more than just the needs of the accounting and finance professionals. When you add in Intacct’s purchasing, order management, inventory management and project accounting modules you realize that for the majority of the industries the company serves*, the product is actually an integrated suite of modules that provides the full operational and transactional system of record of the business. That happens to be Mint Jutras’ definition of enterprise resource planning (ERP). And even where Intacct does not provide the full suite of functionality for operations, often a partner will fill those gaps.

* Intacct targets high growth small to midsize businesses (those with fewer than 500 employees) in the following industries:

  • Accounting firms
  • Franchises
  • Healthcare
  • Hospitality
  • Non-Profits
    • Faith-based
    • Foundations
  • Services
    • Business consulting
    • IT consulting
  • Software and software as a service (SaaS)
  • Wholesale distribution

So while other solution providers, which fall far short of providing this full system of record, overstate their capabilities and claim the category of ERP, Intacct does just the opposite and understates its capabilities.

So… what’s in a name? Does it really matter whether Intacct calls its product accounting software or ERP? The label itself is less important than the assumption behind the label. Figure 1shows an overwhelming preference for a fully integrated, end-to-end solution. Data was collected as part of the 2014 Mint Jutras Enterprise Solution Study, from small to midsize businesses (those with fewer than 500 employees), in the industries targeted by Intacct.

Figure 1: Preferences for end-to-end solution?

Intacct fig 1Source: Mint Jutras 2014 Enterprise Solution Study

These companies need more than just accounting to run their businesses and if they perceive that Intacct just provides accounting, they just might look elsewhere for a full solution, even though Intacct may meet the vast majority of their needs.

Much of Intacct’s growth has come from expanding its solution to meet the needs of the entire business. It has doubled its subscription revenue over the past two years. While new customers account for much of the growth it has experienced, added revenue from existing customers is growing even faster. Some of that growth comes from expanding the footprint of the solution and, of course some from expanding the number of users. More users may be needed when the customer’s business grows. But expanded user counts might also reflect reaching into new functional areas of the business… functional areas outside of the accounting department.

And don’t forget the ecosystem that has developed surrounding and supporting Intacct. This ecosystem now boasts 120 partners and according to Intacct, 75% of customers integrate with at least two partners. Many of these partner products are so tightly woven into the fabric of the Intacct solution that it is impossible to distinguish where Intacct ends and partner solutions begin. This is exactly the type of end-to-end integrated solution the vast majority of our survey participants favor.

The two most recent partnerships with American Express and Salesforce both provide extended capabilities, but also go one step further. These new capabilities are embedded right in the Intacct solution itself.

Intacct Check Delivery Service Enabled by American Express Global Corporate Payments

The offering here is quite simple: Intacct customers will no longer have to write their own checks. They will continue to match invoices and, with a click of a button, can send a request to American Express to cut the check. Customers simply choose “outsource check service” as a payment option. American Express has technology in place to secure the communication and automate the process.

Of course Intacct will charge a fee ($1.50 per check) but the cost savings from automating the process, along with the convenience of not having to maintain and secure check stock should make this very appealing to customers.

In bringing this option to market, Intacct and American Express have engaged with a handful of customers. All are excited and planning to throw their existing stock of checks out, along with the hassle of printing. As companies become more and more security conscious, just eliminating the securing of check stock in the office could be enough to justify using this check delivery service. Mint Jutras anticipates a huge rush to take advantage of this service. The savings are very simple, but also very good.

This could also be just the tip of the iceberg in terms of automation and savings. This service is now limited to accounts payable functions and payment is entirely by check, which is still the primary method of payment for many SMBs. Eventually the two companies will add both card and non-card services and perhaps branch into other areas of cash management, which would be a wise choice.

The Mint Jutras 2014 Enterprise Solution Study asked survey respondents to select the top five categories of business solutions in which they were most likely to invest in the near future. Cash management landed in the top three when looking at aggregated results across all industries, and was number one in service industries, a key target for Intacct.

Intacct Collaborate Embeds Salesforce Chatter Into Intacct

Intacct describes this joint venture with Salesforce as a way to “create a secure social layer across all finance processes and across devices through the Salesforce1 Mobile App.” While the “social” connotation is unlikely to resonate with the finance department, the name (and real purpose) of the product just might. Collaborating to speed execution of the order to cash cycle across finance, sales, and services teams is something that should get the attention of any finance team. And improved communication is key to effective collaboration and execution.

In-person and telephone conversations might be effective in getting immediate attention. But the problem with these conversations is this: Once the people walk away or hang up the phone, the conversation is over. There is no formal record of the discussion or the resolution. Email threads have a longer lifespan, but retrieving and recreating the conversation is far from efficient. And how do you directly attach the conversation to the issue around a customer or an order? You better hope the subject line is clear and meaningful. But it seldom is.

With Intacct Collaborate, customers no longer have to rely on memory or separate and external email threads to resolve process issues. Employees can conduct conversations right inside Intacct’s application, tying them directly to specific records such as customers, projects, invoices, purchase requisitions, journal entries, and more. They can involve the right team members in the discussion and retain them for as long as necessary.

And since Intacct Collaborate is embedded right within Intacct, you don’t even have to be a Salesforce customer, or pay extra to benefit from Chatter as a collaboration tool. However, if you also happen to use the Salesforce Sales Cloud, these conversations appear simultaneously in both systems. This enables Sales to collaborate from the system they spend the most time in, while Finance has access to the conversations from the accounting system of record they call home.

The result: heightened visibility and better collaboration.

Launched at Dreamforce 2014 in October, Intacct Collaborate is already live at several Intacct customer sites, including some from a variety of industries:

  • Canto, a leading provider of digital asset management solutions
    “Collaboration is an everyday activity for finance, whether it’s working with Sales to resolve invoicing issues, clarifying and adjusting order policies, or reviewing transactions within the accounting team. As a multi-national organization, Intacct Collaborate is helping Canto accelerate decision-making, deliver better customer service, and move faster as an organization.”

Hans Schaedel, CFO, Canto, Intacct Collaborate early adopter

  • AWS Truepower, a leader in renewable energy consulting
    “Keeping projects moving smoothly can be a real juggling act – from staffing a project with the right resources, to keeping clients and staff on the same page, to maintaining the records of a project over time. We expect that Intacct Collaborate will help us execute more efficiently and maximize our project performance.”

Sophy Lai,CFO,AWS Truepower, Intacct Collaborate early adopter

  • The Thurgood Marshall College Fund (TMCF), anon-profit that supports and represents nearly 300,000 students attending its 47 member-schools that include publicly supported Historically Black Colleges and Universities, medical schools, and law schools

Conclusions

Intacct targets small to mid-size businesses in a variety of (mostly service-related) industries, seeking to aid customers in “improving company performance and making finance more productive.” And yet its expanding footprint reaches well beyond the finance team and also quite effectively meets the needs of larger, multi-national, multi-entity enterprises. Indeed its installed base includes one customer with over 2,000 active users, another supporting 650 entities and yet another that supports 250,000 transactions a day.

Intacct’s ability to retain these customers through the customers’ own growth phases is a testament to the continued rapid pace of product innovation and Intacct’s foresight and ability to forge strong partnerships with strategic powerhouses like American Express and Salesforce.com. Whether you call it accounting software or ERP, companies with high growth expectations within Intacct’s wheelhouse would do well to consider its solution, not just for accounting, but to run the business.

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Open Source ERP xTuple: Growing with Help from its Friends

Recently I had the opportunity to present one of the keynotes at xTupleCon 2014, xTuple’s second annual user conference. After last year’s inaugural event I posted a recap, referring to xTuple itself, an open source ERP solution provider, as A Small Company with a Big Reach. If you are (still) not familiar with xTuple, and/or are (still) not aware of the premise behind open source, you might want to click on the link above and read last year’s post.

This year, in his opening keynote, xTuple President and CEO Ned Lily (also the author of The ERP Graveyard Blog) started out with a brief history of the company, which you can also see summarized as an infographic on the xTuple website:

  • Company 1.0 (2001 to 2004): The company was originally named OpenMFG and provided software for manufacturing functions only, relying on other third party (external) solutions for financials.
  • Company 2.0 (2004 to 2007): Still known as OpenMFG, the product expanded to include fully integrated CRM, multicurrency, and more advanced manufacturing functionality. While built on open source technology, during this phase the company business model and the product itself weren’t open source – software wasn’t available for free. But it did start to leverage the community and began incorporating user contributions into the solution.
  • Company 3.0 (2007 to 2011): The company changed its name to xTuple to denote growth and more functionality (beyond manufacturing functions), as it “jumped off the cliff and made it real open source. ” It released its core product, PostBooks as free and open source (FOSS) with support for scripting for customizations and extensions.
  • Company 4.0 (2011 to the present): The company remains xTuple, and although it still operates on the premise of open source, as Ned put it, they are “knee deep in R&D on multiple fronts.”

In fact the R&D efforts over the past 3 years are now culminating in a variety of enhancements, including:

  • Mobile Web Client – This is more than just the ability to run xTuple on a mobile device. While it is called the “Mobile Web” it is not a mobile-only solution. However, the desktop client has not gone away and the two are fully interoperable. But beyond the web interface, the Mobile Web Client introduced new object oriented architecture. It is a 100% JavaScript, HTML5-based application, which works on any modern tablet, smartphone or desktop web browser.
  • xTuple Server – Think of this as a pre-configured version of the software for an on-premise server-class (not a desktop) computer. The result is a more secure, standardized appliance for easier implementations and upgrades.
  • xTuple Cloud – This is a secure, hosted model that emphasizes portability. Mint Jutras research has confirmed that many companies are attracted to the concept of being able to move freely between cloud and on-premise deployment, however we see much more movement from on-premise to the cloud than vice-versa. Companies that move to the cloud, particularly SaaS (software as a service) deployments, get hooked and almost never go back. But this portability is an attractive feature for existing xTuple customers wanting to move to the cloud without re-implementing.
  • REST API – Short for REpresentational State Transfer, REST is a technical approach that most business users will not necessarily understand or care about. Suffice to say it is an architectural style that exploits existing technology and web protocols (like HTTP and XML) and is simpler to use than other styles.
  • xTupleCommerce – xTuple is currently overhauling its web portal for B2C and B2B sales. Originally built for xTuple itself to use, it was admittedly a “little clumsy” as a product. xTuple is working on that. A first step in the process is a real-time interface back into the xTuple order system. Most eCommerce solutions available today take more of a “bolt on” approach. With further work, this is an area where xTuple could build out some differentiation in the market.
  • Business Intelligence – the Mobile Web Client integrates with open source business intelligence tools (Pentaho Open BI Suite) to provide an integrated open source toolset for analytics and dashboards.
  • xTuple Distribution – A dedicated new edition for wholesale distribution was introduced last year at xTupleCon 2013 and continues to be further developed

xTuple’s stated mission is to “help companies of all sizes successfully implement powerful and easy-to-use open source ERP software to grow their business profitably.” While not the only open source ERP on the market, it is probably the most well known and perhaps even the leader. It provides a potentially attractive alternative for small companies to move away from entry-level solutions like Sage One (formerly Peachtree) and Intuit’s Quicken or QuickBooks at a very low price – maybe even for free! But xTuple is not just installed in small companies. With companies like Nordic Naturals, UHaul and Good-lite to its credit, it has proven it can also address the needs of larger companies, but must continue to broaden and deepen its offering.

Meanwhile, even as some industry observers still claim ERP is dead, I see the market moving more quickly than ever. Solutions are expanding far more rapidly than ever before as new technology enables more rapid innovation. Will the open source business model allow xTuple to keep pace with the pace of the market? It will need a very engaged community and will need to effectively tap into the strength of that community and channel those efforts back into the product. If those in attendance at xTupleCon are a good indication, they are very well engaged. While it might not have the deep pockets that other ERP vendors might have, with the continued help from its friends and customers, it doesn’t appear that xTuple is in danger of winding up in the ERP Graveyard any time soon.

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Workday: Is it ERP or Not? Does it Matter?

You may have noticed I haven’t written much about Workday over the past few years. It’s not because I’m not interested. I am. But I haven’t had as much direct contact and interaction with the company as I would like in order to write from a basis of knowledge and experience. Having recently been invited to an analyst briefing call, I hope that is changing.

Some might assume this lack of direct contact is because I write a lot about ERP and Workday seems to go out of its way to characterize itself as not an ERP company. However, as an analyst, I always describe my coverage area as “enterprise applications with ERP at the core.” But the footprint of ERP has grown to the point where it is getting more and more difficult to determine where ERP ends and other applications begin. Those that know me well “hear” me talking about functions and topics (like performance management, talent and human capital management, etc,) that used to sit squarely outside of ERP, but today might sit either inside or outside that boundary. They also “hear” me talk about financial management, which can be an integral part of ERP, or a stand-alone solution. Both of these are certainly in Workday’s wheelhouse.

While Workday might be careful to say “We’re not ERP,” I hear other influencers refer to the company and its products as “ERP” all the time. In response I have been known to challenge those influencers, asking, “Is it really ERP?” I don’t do that to be contentious, or to denigrate Workday’s solution, but to better position it. Who should buy it and why?

I have always been careful to define ERP quite clearly, and in fact my definition outlasted me at Aberdeen. I left Aberdeen and founded Mint Jutras almost four years ago (January 2011), but my definition of ERP lives on there.

My definition of ERP is quite simple:

ERP is an integrated suite of modules that provides the operational and transactional system of record of the business.

Of course many (if not most) ERP solutions today do much more. But the minimum requirement is to provide an auditable record of operations, including any transaction that impacts the balance sheet (assets and liabilities) or the profit and loss statement. So does this mean an integrated suite of accounting modules qualifies as an ERP solution? It’s close, which is why I am able to collect so much data on financial management solutions in the context of my annual ERP solution studies, and in 2015 I am devising a way to capture data specific to each while distinguishing between the two. But the question is not as simple as it might seem and I have found the real answer lies in whether or not the solution handles orders: both purchase orders and sales orders. While purchasing is not strictly the domain of finance, it is not unusual for a financial management solution to include at least the basic requirements for purchasing transactions. It is less likely for these financial solutions to include the sales order.

An interesting aside: I attended the very first analyst call back in 2006 when Dave Duffield and Aneel Bhusri introduced Workday. I remember clearly that Workday was introduced as a ‘new ERP company”, although the first functions that would be developed would be for managing Human Resources (HR). The HR part came as no surprise given the founders’ background (Peoplesoft). But the reason I remember it so well is because Dave Duffield actually said something along the lines of, “You are probably wondering whether the world needs another new ERP system.” Of course Workday went on to fully develop its Human Capital Management solution, including HR, benefits, talent management, recruiting, payroll, time tracking and workforce planning and analytics. Financial Management came later.

So, what about the full operational and transactional system of record? Yes, Workday’s Financial Management solution handles the purchasing side, covering the full procure-to-pay process. And earlier this week, I got excited when I heard it also handles the full cycle from contract to cash. Aha! Is that the final piece of the puzzle that would qualify it as an ERP? While I might prefer a simple black and white, yes or no answer, I think there are at least a few shades of gray here, depending largely on the type of operations in question.

So I went in search of the sales order. I found a “contract” but not a sales order. But then remember that Workday specifically targets talent intensive organizations, including several for which it has developed new features in its latest Workday 23 release (the topic of the recent call):

  • Software and Internet Services
  • Financial Services
  • Business Services
  • Higher Education and Non-profits

Also noted on its website are healthcare, state and local governments, and retail and hospitality. These types of businesses don’t necessarily book an order in the classic sense of the term (e.g. when you think about an order for widgets). Colleges and universities don’t sell degrees. Hospitals don’t sell surgical procedures. Hotels don’t sell and deliver rooms. Business services are contracted for. Even software companies that might talk about booking an order are really more likely to sign a license agreement or offer a subscription (both are contracts). So in this case, the contract represents the commitment to buy and is the trigger for invoicing. In these cases, I would guess that Workday’s Financial Management suite can provide the full operational system of record for the business. In other words, by my definition, they are providing ERP to these types of businesses.

But if they were to stray outside these target markets, they can’t provide the full operational system of record, especially for a manufacturer. While Workday does target manufacturers, if you look closely you realize it is selling Human Capital Management to manufacturers, especially those looking to balance human resources to optimize revenue opportunities.

Flextronics, a global leader in design, manufacturing, distribution and aftermarket services, and one of the largest contract manufacturers in the world, is a Workday customer with over 200,000 employees in 30 countries. According to Mike McNamara, CEO, “We have to rebalance our workforce on a continuous basis for our customers. For example, we may be spending a lot more time in Malaysia and a lot less time in China. We may want to move more of our workforce into Mexico as opposed to Eastern Europe, depending on the markets we’re accessing. And Workday actually gives us the data to continuously analyze what our cost structures are—the average labor rates in each area. It has actually changed some of our investment policies for different countries as a result of studying the data and the trends in the data.”

Flextronics is running Workday’s HCM. I suspect Workday doesn’t sell a lot of Financial Management to manufacturers except maybe to replace corporate level financials. Manufacturing sites already have accounting functions embedded within ERP because it is hard for them to live without it. This is the perfect setup for a two-tier standard for ERP: manufacturing ERP at the divisions, rolling into a corporate ERP, which may just be financials, analytics and maybe even HCM (like Workday).

So this begs the question: Why does Workday go out of its way to characterize itself as not being ERP? Mark Nitter is the vice president at Workday responsible for setting the strategic direction of its products. He wrote about this in his blog post Why ERP Is Out, and Unified Finance and HR Is In, in which he assumes all ERP solutions were “designed for enterprises engaged in the manufacture and distribution of goods” and that “people were primarily seen as labor—a commodity whose cost is to be minimized.” He also assumes there is an arm’s length relationship between finance and HR. Mr. Nitter writes:

At Workday, we certainly don’t consider what we offer as “ERP.” From the beginning, our mission was to deliver an enterprise cloud for HR and finance, and this solution has been a key driver for many of our talent-driven enterprise customers, including AAA NCNU, Allied Global Holdings, Life Time Fitness, Sallie Mae, and TripAdvisor. For these companies and others, a business management system that unifies HCM and financials provides efficiencies and insights far beyond the capabilities of the ERP model.

An example: Imagine that a P&L analysis points to a revenue shortfall for your fiscal quarter. State-of-the-art financial drill-down analysis may help you identify which organization, product, or customer is responsible. But what if the reason for the shortfall cannot be determined through analysis of financial data? What if the reason for lower-than-expected revenue is that you have three open positions in the sales organization, and have had for six months?

The arms-length relationship between finance and HR that exists in ERP systems cannot deliver this insight. Separately, the finance department could identify where the shortfall occurred, and the HR department—if it knew where to look—could identify the hiring problem, but only a unified solution is capable of connecting the dots.

I would agree that most ERP solutions today couldn’t identify this hiring problem. But that is not because of any inherent limitations of ERP. It is because the ERP solution doesn’t have the same depth of functionality in HR that Workday has built into its solution. Yes, ERP evolved from MRP, which was originally designed to meet the planning needs of manufacturers. But ERP has evolved way beyond the realm of manufacturing and some ERP solutions on the market today – in fact those solutions that compete most directly with Workday – were never designed to support (physical) product-based businesses.

So, is Workday ERP? I would mostly agree with Workday and say, “Not really.” But does it matter what you call it? I would say, “Yes it does.” That is if Workday wants to be considered as a viable option in all the places where it could truly add value.

This is particularly true in companies that already have ERP and are not looking to replace it. Because HR has been largely underserved by ERP for many years, many ERP implementations lack a lot of specialized HCM functionality. Workday’s HCM can add very significant value, even without being sold as a “unified finance and HR solution.” If Workday portrayed itself as an ERP solution, that prospect would likely say, “No thank you. We already have one of those.”

Mint Jutras data indicates a dichotomy of preferences in satisfying HCM requirements. While there are some that have a strong preference for HCM functionality embedded within ERP, an (almost) equal number strongly prefer a separate (possibly stand-alone) applications. The remainder has no defined preference and will decide based on a combination of functionality and price (Figure 1).

Figure 1: Preferences for HCM Functionality

Figure 1 WorkdaySource: Mint Jutras 2014 ERP Solution Study

However, where the Workday solution might provide a complete system of record, this argument might work against Workday. Where those companies perceive the need for ERP, even though Workday might have all they need, if Workday says it doesn’t sell ERP, it might not be considered. This may also be true where companies might define a two-tier ERP strategy, with one ERP providing corporate financials and a second standard defined for units, divisions or business units. If the prospect has defined this as a “two-tier standard” for ERP, it will be looking for ERP at the corporate level, even though orders are managed at the divisional level and “unified finance and HR” is what it really needs. The difference in the label might make all the difference in which solutions they will consider.

Bottom line: I admire Workday for identifying the value of a unified finance and HR solution particularly for the “talent-driven enterprise” and for not portraying itself as something that it is not. Some of the influencers who refer to them as “ERP, just not for manufacturing” could learn a lesson or two from this. But at the same time, I would caution Workday against assuming that an ERP can’t and won’t unify finance, HR and a lot more.

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Infor customers: Are you listening?

Once again Inforum, Infor’s annual customer event was chock full of new announcements. At last count I saw 13 press releases issued since the start of the event on Monday September 15th:

Sep 17, 2014 Etam Group Expands Scope of its Marketing Activities with the Help of the Latest Version of Infor’s Marketing Management Solutions

Sep 17, 2014 Brasil Norte Bebidas Adopts Infor Solution to Optimize Logistic Processes

Sep 17, 2014 Kansas City Citizens Receive Enhanced Service from Local Government

Sep 17, 2014 Infor Aligns With MercuryGate To Strengthen Transportation Management

Sep 17, 2014 Infor Helps Ferrari to Accelerate Supply Chain Planning

Sep 17, 2014 Infor Announces Internship and Educational Alliance Programs

Sep 16, 2014 Infor Delivers Robust CloudSuite for Business Management

Sep 16, 2014 Infor Announces New Era of Automated Financials

Sep 16, 2014 Infor CloudSuite Available for Healthcare Delivery Organizations

Sep 16, 2014 Infor Announces New Technology Platform, Infor Xi

Sep 16, 2014Infor Dynamic Science Labs Pioneers New Class of Applications

Sep 16, 2014Infor and Aras Deliver Transformative Cloud PLM Solution

Sep 16, 2014Infor Reports Q1 License Revenue at Double-Digit Growth

Sep 15, 2014Varian Medical Systems and Infor to Add New Data Integration Capability within Varian Software Suite for Planning, Managing, and Delivering Cancer Care

 

As you can see from the list above, this collection of news bites is quite diverse. You might even say it’s all over the map. And still it doesn’t cover everything I found noteworthy from the event. Having grown through acquisition, in the past Infor has struggled to have any focus beyond growth for the sake of growth. But I would argue that in spite of the large volume of news, in spite of the diversity, today Infor does have a focus. And that focus is something I have been writing a lot about lately: the convergence of trends, with goal of making ERP easier to consume.

My recent 2014 Trends in ERP Converge report began as follows:

In 2013 you couldn’t pick up an article without being bombarded with what industry observers were calling the “big trends” in enterprise software. We heard cloud and software as a service (SaaS) deployments would take over, although definitions were just that… cloudy. We heard about the prevalence of mobile devices and the resultant “consumerization of IT.” “Social” took on new meaning as Facebook, Twitter and other social media phenomena not only changed the way many of us communicated with the world but also impacted our business applications. And then, as if we weren’t already bombarded with enough data, we heard all about “big data,” analytics and in-memory computing. Enterprise Resource Planning (ERP) was not immune to these influential factors and the solution providers strove to brand themselves in the context of these trends. Will these trends continue to dominate, or will we see new waves of innovation? Mint Jutras anticipates 2014 will bring the convergence of these trends, brought together by a common goal of making not only innovation, but also the enterprise applications themselves inherently easier to consume.

 And that was the focus I heard at Inforum. It was all about making software that people want to consume, while making it easier to consume. Infor started down this path with Infor 10x, a platform that delivered a reinvented HTML5 user experience (the SoHo user interface), Infor Ming.le (its social collaboration platform), and embedded analytics. The Infor ION framework (light weight middleware) was integral to this effort. This week Infor announced the next evolution of Infor 10x: Infor Xi, which it calls “an enterprise technology platform for next-generation applications…[which] will deliver a major step in achieving the company’s vision for cloud applications that address specific industry needs with responsive design infused with machine-learning and big data analytics.” That’s a mouthful, but I think it supports my concept of this convergence of trends towards a common goal.

Infor has been talking about “beautiful” software for the past two years, introducing this concept at Inforum 2012. I haven’t always been a big fan of “beautiful” software simply because I think beauty is largely in the eye of the beholder and typically beauty isn’t the primary concern of users. It’s got to be more than a beauty contest.

I have been observing the growing importance of “ease of use” in terms of ERP selection criteria for the past few years. I have asked survey participants to prioritize ERP selection criteria in my annual ERP survey for many years. While “fit and functionality” reigned for years, “ease of use” has bubbled to the top for the past two years (Table 1).

Table 1: Priorities of Selection Criteria in Evaluating ERP

Table 1 InforSource: Mint Jutras 2014 and 2013 ERP Solution Studies

Survey participants were asked to rank the importance of thirteen different selection criteria for ERP on a scale of 1 to 5 where 1 was “not a consideration” and 5 was “must have/most important.” There was nothing to stop the respondents from ranking each and every criterion as a “must have,” but they didn’t.

So what does “Ease of use” mean? Glad you asked. I asked that of my survey respondents as well. For this question, I gave them a list of options and asked them to pick their “top 3.” I guess a “visually appealing user interface” is the closest I come to “beautiful software.” As you can see in Figure 1, it is not at the very top of the list. Factors that affect efficiency and productivity outrank beauty. But in spite of the words Infor execs use (beautiful software), I actually think this is what they are striving for.

Figure 1: What does Ease of Use mean? Pick your top 3

Figure 1 InforSource: Mint Jutras 2014 ERP Solution Study

Sadly enough, all too often in the past, ERP solutions that were meant to streamline and automate processes ended up forcing users to work in ways that simply weren’t natural. That point comes up a lot when talking to Infor execs. In fact they have launched a new initiative (Infor refers to it internally as SoHo Glide) to further improve the user experience. Graphical user interfaces (GUIs) have evolved from legacy command line interfaces. Now Infor wants to take the next step from “graphical” to “natural,” which addresses both the need for intuitive navigation and supporting a natural way of working. I could talk for pages about this, but the best way to understand what they are doing is to ask for a demo.

While many cite “Don’t make me change my business processes” as a “top 3” priority in terms of “ease of use,” I would warn Infor’s (and other vendors’) customers not to use this as a blanket requirement, unless of course all your business processes reflect best practices and/or provide a source of differentiation for you in your market.

Infor has flat out stated that it wants to rid the Infor world of customizations. That’s at the root of its micro-vertical strategy. The goal is to have very industry specific solutions that can address all the requirements of a particular sector without the need for customizations or other point solutions. But that doesn’t mean the software can or should support every idiosyncrasy of your company. “We’ve always done it that way” is not a valid justification, especially if the reason you did something differently was because of a (previous) gap in software functionality or resistance from an individual (who probably doesn’t even work for your company any more). There are a lot better solutions out there today, some of which are offered by Infor.

“Friends don’t let friends build data centers”

One of the reasons Infor is so adamant about removing customizations is because of the move to the cloud. I have lots of data that shows the growing willingness to consider, even the preference for cloud-based solutions. Infor has known for a while that this was happening, but execs on the main stage of Inforum 2014 admitted the push to cloud happened a bit faster than they had anticipated. Hence the “all out” effort to be “all in” on the cloud. And in fact the quote in this heading was from Infor CEO Charles Phillips.

Infor is offering two different paths to the cloud. Its UpgradeX program is probably most attractive to companies that are stuck on older releases, often because of the cost and effort of the upgrade process. Through UpgradeX, Infor gets the customer to the latest release of the software and then lifts and shifts it to the cloud, taking responsibility for its care and feeding, including upgrades. This is more of a hosting option, but relieves the customer of the burden of maintenance of both hardware and software.

I should point out that this option is not available to all customers because not all product lines are cloud (web-) enabled. Those Infor teams are working hard to encourage customers to remove customizations and move forward in anticipation of that day. But I have a better idea. Where Infor has an alternative solution that is modern and technology-enabled, get rid of that older solution and move to something that can more easily, safely and efficiently move you into the future.

You won’t hear Infor say this because it doesn’t want to appear to be abandoning customers or products. And of course, moving forward could mean opening the door to a competitive situation. Quite frankly, when I worked for software companies, some of which are now owned by Infor, I would have said and done the same.

But looking objectively from the outside in, I don’t think this serves the customer well. Suggesting “rip and replace” used to be heresy but today it might just be the fastest, cheapest path to get you to a far more competitive position.

If you do consider trading in an older Infor solution, the other cloud path might be best for you. Re-implement on one of Infor’s industry-specific CloudSuites. These CloudSuites integrate multiple functions traditionally requiring disparate systems into a single suite. Some will be industry-based (e.g. healthcare, manufacturing verticals, wholesale distribution, etc.) and others will be “solution” suites (e.g. financials, human capital management, etc.). These CloudSuites are all destined to be multi-tenant software as a service (SaaS) solutions, although all the necessary components are not multi-tenant today.

The CloudSuites will be available on the Amazon Web Services (AWS) cloud infrastructure. As Infor’s COO Pam Murphy likes to say, “Infor is in the enterprise application software business. We let someone else worry about pipes and feeds.” Of course a significant advantage to customers and Infor both is the elasticity and scale of AWS. Infor will also use leading open source solutions including Red Hat’s Enterprise Linux (RHEL) and JBoss Enterprise Middleware, and EnterpriseDB’s Postgres Plus database. And all will be supported by Infor ION®, Infor’s purpose-built, lightweight middleware. Infor ION provides integration and other services.

These suites will feature a consumer-grade user experience from Hook & Loop, Infor’s internal design agency based in its Manhattan headquarters. And they will have embedded analytics. This is an important point. As other vendors are packaging business intelligence (BI) tools and analytic applications and selling them separately, Infor is operating on the belief that analytics are core to next-generation applications and should be a basic part of the solution, with no additional charge.

These analytics will also run on mobile devices. In many ways Infor adopts a “mobile-first” design philosophy that is becoming quite prevalent in new development today. But it also recognizes that a lot of work (both transactional and decision-making) is still done on a desktop, so it is committed to bringing the consumer-grade user experience to all.

In fact this enhanced user experience, based on “beautiful software,” is all about engaging more of its customers’ employees. In the past only a small percentage of employees ever put their hands on ERP – those doing heads-down data entry and a few selected “super users.” Executives in particular couldn’t be bothered to “figure it all out” and were dependent on those super users for answers, causing delays that could be fatal to decision-making.

But today that is changing. The better the experience, the more connected the people running the businesses are to ERP and to each other. And Infor has the stated objective of ending “the tyranny of the super user.” Mint Jutras is already seeing a shift in the market to higher levels of engagement with ERP and cloud deployments seem to play a big role. While overall a little over half (55%) of employees use ERP today, that percentage jumps to 63% when a SaaS solution is deployed (Figure 2).

Figure 2: What percentage of your employees uses ERP?

Figure 2 InforSource: Mint Jutras 2014 ERP Solution Study

Of course cloud-enablement is not the only factor here, but, apart from the access anytime, from anywhere advantage of the cloud, today’s cloud-based solutions are not saddled with a lot of older technology that stands in the way of a consumer-grade experience.

But Will Infor Customers Move?

The new management that took over Infor a few years back has brought significant change to the culture, the technology and the direction of the company. I think all these seemingly distinct announcements are all pulling Infor in the right direction and we’re really starting to see positive results. But the real question remains: Will its customers follow it into the future?

I went to my first Inforum in 2006 and was stunned to learn that Infor had 70,000 customers. Yet through the years of further acquisitions and more Inforums where the stats offered up about numbers of new customers were impressive, the total remained at 70,000. That told me that some customers (although still running run Infor products) might not be (maintenance) paying customers anymore and/or there was attrition equal to new customer wins. That is troubling for any software company.

This year that changed. In 2013 Infor added 3018 new customers and the total jumped to 73,000. But Infor still has a very large number of customers that simply are not in a position to take advantage of all this new technology, including consumer-grade user experiences, mobile design, cloud connectivity, embedded analytics, etc. etc. Other vendors see that as a huge opportunity.

Having dealt directly with some of these specific customer installed bases in the past, I would say a very large part of the reason these customers stay where they are is inertia. It is the “if it ain’t broken….” syndrome or the philosophy that ERP replacement is like brain surgery. Don’t do it unless the patient is dying. Anyone that follows me knows exactly what I think about that philosophy. Waiting until your business is in distress is not the optimal time to set out on a new ERP implementation.

Infor is offering a lot of options to its customers, but not every customer has the exact same options. These new “natural” customer experiences, new technology, new products and new CloudSuites are quite compelling. But if a customer can’t figure out how to get there, it’s all meaningless. Infor has been working on so much that it can be appear quite overwhelming. And it is very hard to convey this in a general session in front of such a diverse crowd. And it is equally hard to have 73,000 conversations.

The promise of beautiful software is not enough. Infor’s story is much more than that, but are its customers listening?

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Acumatica Poised as ERP Trends Converge

 

Partners Attracted by Technology, Innovation and Choice

Acumatica held its annual Partner Summit earlier this week in Broomfield, CO, just outside of Denver. Attendance this year topped 400, with over 100 partner companies represented. Over the past year Acumatica has undergone some management changes, bringing in a new CEO and a new head of partner strategy, a key role considering 100% of its sales are indirect. There was a definite sense of excitement in the air this year, partly as a result of the new management, but largely due to a combination of technology, innovation and choice of cloud-based deployment options offered in response to the latest trends impacting Enterprise Resource Planning (ERP).

Mint Jutras has been writing a lot about four specific trends this year. Its report, 2014 Trends in ERP Converge, looked back over these “big trends” in enterprise software from 2013 and concluded that we don’t need any new or different trends for ERP in 2014. Cloud, mobile, social and big data will do just fine. However, we have concluded that it is no longer sufficient to treat them as independent movements. We need them to converge around a single common goal of making ERP easier to consume, thus bringing more value to the business. Enlisting the aid of OEM and VAR partners, Acumatica has set its sights on delivering on this promise of added value.

The Key Trends

As I have noted before (but it is worth repeating), the 2014 Trends in ERP Converge report talked about four specific trends. These should come as no surprise to anyone following enterprise software:

  • Cloud and software as a service (SaaS)
  • Mobile access and the consumerization of IT
  • “Social” as a way to deliver collaboration, connectivity and visibility
  • “Big data” for intelligence and decision-making

It is impossible to talk about the convergence of these trends without mentioning innovation that is easier to consume in a less disruptive way. This often requires new ways of engaging with ERP in order to change the whole ERP customer experience. So how does Acumatica address each of these trends?

Pure Cloud

Acumatica can be characterized as a pure cloud solution. The Acumatica solution was born in a browser and therefore has always had a zero footprint on the client, making it accessible any time, from anywhere. No legacy issues here. It is built from the ground up with cloud technologies: SOAP, web services, HTML5, Azure, Amazon, etc.

Many use the terms “cloud” and “SaaS” interchangeably, but indeed they are not the same. The distinction is quite simple and need not be over-complicated:

  • Cloud refers to access to computing, software, storage of data over a network (generally the Internet.) You may have purchased a license for the software and installed it on your own computers or those owned and managed by another company, but your access is through the Internet and therefore through the “cloud,” whether private or public.
  • SaaS is exactly what is implied by what the acronym stands for: Software as a Service. Software is delivered only as a service. It is not delivered on a CD or other media to be loaded on your own (or another’s) computer. It is accessed over the Internet and is generally paid for on a subscription basis. It does not reside on your computers at all.

Using these definitions, we can confidently say all SaaS is cloud computing, but not all cloud computing is SaaS. Acumatica is cloud-based but not always delivered as SaaS.

The downside of being “cloud only” often means less choice. Typically a cloud-based solution is only available as software as a service (SaaS). Not so with Acumatica. Lots of choices here: multi-tenant SaaS, single tenant SaaS (more like a hosted model), or even traditional on-premise deployments. You can purchase a perpetual license or pay a subscription. It is designed to be a multi-tenant cloud solution, but that doesn’t prevent Acumatica from offering it in a variety of different environments and Acumatica is quite unique in this regard.

Some industry observers, including those that have their own specific definition of what constitutes “true SaaS,” might argue against this approach. While Mint Jutras is seeing a major shift in acceptance of SaaS solutions, our research also proves that there is  continued interest in other delivery options for the access any time, from anywhere advantages of the cloud. But we see a decided decline in interest in traditional, licensed on-premise solutions (Figure 1).

Figure 1: Which deployment methods would you consider today?

Figure 1 AcumaticaSource: Mint Jutras 2011, 2013 and 2014 ERP Solution Studies

Many are simply looking to unburden themselves from the care and feeding of enterprise apps like ERP. They are attracted by lower costs, easier upgrades, less hardware and IT staff and are less worried about a single prescription of how cloud solutions are delivered. They are looking for business partners they can trust and having more choices in how they address these needs can be very attractive.

However, Acumatica does sacrifice some of the advantages of a pure multi-tenant solution through this approach. For those not familiar with the terminology, Mint Jutras uses the following simple definitions:

  • Multi-tenant SaaS: Multiple companies use the same instance of (hosted) software. Configuration settings will vary per company and data is protected from access by other companies (tenants).
  • Single-tenant (or Multi-instance) SaaS: Each company is given its own instance of the (hosted) software.

Those vendors that only support a multi-tenant environment have the luxury of maintaining one single line of code. By not having to worry about multiple instances at different (potentially customized) version levels, they are better positioned to deliver more innovation, faster.

However, at the Partner Summit, Acumatica announced a new Acumatica Grow Program, which leverages the multi-tenant capabilities of its solution within the partner community. FusionRMS for SMB Retail is one example.

Fusion Retail Management System (FusionRMS) is a suite of applications extending the reach of Acumatica to the SMB retail and wholesale distribution markets. Offering added functionality such as point of sale (POS) and warehouse management (WMS), its solutions are seamlessly integrated with Acumatica without effecting core functionality. Now, through the Grow Program, it is also offering multi-tenant SaaS back office accounting supported through Amazon Web Services (AWS).

While this might sacrifice some of the flexibility of choice other Acumatica customers enjoy, Fusion Retail Management manages a single line of code and can pass along savings to its customers. This helps them support clients that otherwise might not be able to afford Acumatica.

Fusion Retail Management not only sells direct, but also other partners bring them small retail clients that might be too small for Acumatica now. This is preferable to simply losing a deal, particularly in knowing they will get them back if the prospect grows. FusionRMS supports these small clients until they grow large enough to justify the purchase or subscription of Acumatica. At that point, FusionRMS turns the client back over to the partner.

A Mobile Framework

The trend towards mobile goes hand-in-hand with cloud, as mobile access is gained through web-enabled services. We are seeing different approaches to mobility in the ERP market these days. Some vendors are adopting a “mobile first” design approach. Any features and functions are being designed to “fit” on the real estate of a tablet or smart phone. Others are taking a “mobile apps” approach where they are releasing multiple, individual purpose-built apps that complement core ERP. Some are building these themselves and others are leaving this development effort to partners. Some are hosting “App stores” where customers can shop. Others simply bundle them into existing software licenses.

Acumatica is taking the approach of providing a mobile development framework, purposely leaving the actual delivery of the mobile apps to the partners in order to provide them more opportunity. But this framework isn’t built for a developer. According to CTO Mike Chtchelkonogov (aka Mike C), “You no longer have to be a developer to target the mobile market. In the past, partners may have needed to hire specialists to create iOS or Android applications, but with Acumatica’s new mobile development framework, any of our partners can do it.”

This is especially important to the Acumatica channel because many partners are business and implementation specialists and not technologists. According to Mike C, the partner [or the customer] can take any part of Acumatica and expose it on the mobile device. So what kind of opportunity are we talking about? That might be in delivering a customized solution through services, or building an app to be sold through Acumatica’s app store.

What About Big Data and Social?

There was not a lot of direct reference to “social” and “big data” at the Acumatica Partner Summit. But that doesn’t mean either is being ignored, only that these trends and concepts are being worked into the product roadmap naturally, not as separate and distinct efforts. In fact many of the new features of its upcoming new release 5.0 indirectly support the goals of a “social” enterprise.

Social can mean different things to different people. It has some intuitive connotations in the world of consumer goods where social sentiment can have a serious impact, both positively and negatively, when shared publicly. But the real impact in any industry, while perhaps not as intuitive, is quite real.

When you take the view that “social” should mean improved collaboration, visibility and connectivity, then you start to understand the connection with the ERP user experience. Much of the development effort that produced the latest release 5.0 has gone into the user experience. Probably the best testament to the result was the fact that several key top executives put their hands on keyboards, or their own mobile devices, and ran their own demos. Not only were these “real” demos (not mock-ups or a series of screen shots in PowerPoint), but no pre-sale consultant or sales engineer was needed.

Simply by putting access to an ERP directly in the hands of high-level decision-makers improves connectivity, which in turn fosters visibility and collaboration.

Another announcement at the Partner Summit reinforced Acumatica’s commitment to another type of connectivity: a deep partnership with Azuqua, a cloud connectivity platform. On stage Azugua demonstrated its recently launched cloud integration service featuring connectivity between a broad range of popular web services (including Salesforce, Office 365 and Hubspot) to Acumatica’s system. Interestingly enough, the integration demonstrated on the main stage was so dead simple that it led to skepticism from industry observers and influencers in the audience. Was it too good to be true? I suspect it is real, but time and partner experience will tell.

As to “big data,” Acumatica was quick to point out its approach was very different from those of ERP giants SAP and Oracle. Instead of building a “big data” platform outside of the ERP system and requiring retrofitting of existing systems, Acumatica is building this kind of capability into its solution. This speaks to speed and ease of handling large volumes of structured data, but downplays (ignores?) the inclusion of massive volumes of unstructured data. It appears this is also something Acumatica might leave to partners and it will take a special kind of partner to deliver on this.

The Convergence of Trends Toward a Goal

If you recall, in our intro, the goal was to have these trends converge around a single common goal of making ERP easier to consume. The better the experience, the more connected the people running the businesses are to ERP and to each other. In fact over the past few years, we’ve observed an increase in the percentage of employees who actually use ERP. Today that percent is about 55%, up from about 20% less than a decade ago. In addition, 62% of survey participants claim top-level executives have direct access to and regularly use ERP. So Acumatica executives are not the only execs in the driver seat when it comes to using ERP. Another 30% indicate these high level execs have at least some access to ERP.

This, combined with expectations raised by the consumerization of IT, is perhaps the catalyst in shifting priorities in terms of ERP evaluations. While fit and functionality was king for many years, it has slipped to number two in the priority of selection criteria. “Ease of use” has taken the number one spot.

But “ease of use” means different things to different people. In fact it means different things to a single individual (Figure 2).

Figure 2: What does ease of use mean? (top 3 priorities)

Figure 2 AcumaticaSource: Mint Jutras 2014 ERP Solution Study

While many vendors are focusing efforts on “beautiful” software these days, beauty is always subjective. Those using ERP today are more concerned about efficiency and productivity than in a visually appealing user interface. Being a relative new-comer to ERP, Acumatica (founded in 2007) might not have the same depth of features that other more mature solutions have. But the development team seems to be working on a good balance of features and functions, along with better usability and a web platform that helps partners further develop breadth and depth. If the reaction to the main stage demos is any indication, partners and the few customers in attendance at the Partner Summit agree.

Ehrin Dimitry, CEO of AME Corporation, an Acumatica customer said, “I thought I knew what our next steps were until I saw Acumatica 5.0. My wheels are turning!” Customers and partners seemed genuinely excited about this newest release, a clear indication of perceived value.

Summary and Key Takeaways

As a pure cloud solution provider, Acumatica is very well positioned to deliver the benefits of the cloud through a variety of different deployment options. Virtually every partner I spoke with at the Partner Summit was drawn to Acumatica for its technology. Few offer Acumatica exclusively and many of them have experience selling, implementing, servicing or developing other ERP platforms. But that seemed only to strengthen their opinion of and commitment to the Acumatica solution. They like the partner friendliness of a relatively small company that sells exclusively through the channel. They are drawn to cloud computing but like being able to offer choice.

Customers and partners alike were enthusiastic about the latest release and the roadmap forward. Overall Acumatica seems poised to deliver as major trends like cloud, mobile, social and big data start to converge.

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