salesforce

What does fishing have to do with Salesforce? #DF15

A Quick Take on News from Dreamforce 2015

Last week I set aside some time to watch some of the big keynotes from Dreamforce, Salesforce’s annual extravaganza. Like Dennis Howlett, reporting for Diginomica, I watched from what Den calls “the cheap seats.” While thousands of attendees swarmed San Francisco, I was part of the virtual audience watching the live stream. As a result I was thankful to be insulated from the chaos and gridlock of a city pushed to its limits, but also missed what appeared to be a truly electric and energizing atmosphere.

There was no shortage of announcements surrounding products and partnerships, and I am certain I missed a lot. For more thorough coverage I might recommend Diginomica’s site. They not only had Den watching from the cheap seats, but a whole team covering it onsite. But from my vantage point, what struck me were the two very different faces of Salesforce – the application side and the platform side. Anyone who follows me knows that I research and write for business leaders about enterprise applications. So you would think I would primarily be interested in the applications, right? Not this time.

The category of applications Salesforce delivers is on the periphery of what I cover. As an analyst I describe my coverage area as “enterprise applications with ERP at the core.” Here is not the time or place to debate what ERP is, or is not. Suffice to say it is a convenient label for the applications that run the business, creating a fiscal and operational system of record. While Salesforce’s (or anyone else’s) CRM solution doesn’t fit that definition, it is still important for me to watch because the footprints of ERP solutions have expanded and oftentimes include CRM. Even if they don’t (e.g. the customer uses Salesforce), the intersection of ERP and CRM is important because it is often where the back office meets the front office where competitive advantage can be gained.

So watching from the sidelines has always seemed appropriate. Lately, however, I seem to be getting dragged from the sidelines to more center stage – but not because of its CRM solution. Instead it is its Platform as a Service that is calling me.

Platform as a Service (PaaS) is a category of cloud computing services that provides developers with a platform to create software without the complexity of building and maintaining the infrastructure typically associated with developing an enterprise application. Clearly developers benefit from using the services delivered with a platform, speeding the development process. Since I don’t write for developers, but for the businessperson, how does this translate to benefits to the business? The obvious answer is in delivering more features, functions and innovation in ways that help companies keep up with the accelerating pace of change.

And that is exactly what a growing number of Salesforce partners find appealing, including ERP and accounting solution providers who fall squarely in my line of sight. It has been those partners that have lured me from the periphery to better understand how Salesforce, as a platform company, can help them deliver more value. I also think that it will be the platform, not the applications, that has the highest likelihood to propel Salesforce on the growth trajectory on which Marc Benioff has his sights.

It’s sort of like the old proverb that goes something like this – give a man a fish and he eats for a day; teach him how to fish and he eats for a lifetime. Well, maybe not exactly like that. The platform itself might be appealing to large enterprises with teams of developers on staff looking to modify or even develop their own applications (i.e. learn to fish). But for every large enterprise there are dozens, maybe even hundreds or thousands of small to midsize businesses that are just looking for a fish. Of course, they don’t buy one fish and walk away – they sign up for the “fish a day” program (a subscription). So, sure Salesforce can sell a lot of fish, but that won’t get it to the $10 billion mark – not even close.

But the platform is a “Force” multiplier (pun intended). There are also those partner solution providers who are looking to not only fish, but fish with the latest and greatest fishing tackle and equipment on the market. Using Salesforce’s platform they have proven they can not only fill their nets, but also get to the dock and the fish markets that much faster. Or maybe they don’t go after fish at all because Salesforce CRM satisfies that nutritional requirement. They might be working on the meat and potatoes, the vegetables or the dessert. Together they will have all the other dishes that go with fish in order to make a whole meal and satisfy anyone’s appetite.

The better the development platform, the more likely it will attract more developers. The more developers attracted to the platform, the more applications get developed, which ultimately can be shared. Features, functions and extensions have the potential to start to grow, if not exponentially, at least much faster than the typical linear sequence of development. This is sort of a Catch-22, but in reverse. The strong keep getting stronger, while the weak (those that attract only a few developers) will struggle to compete.

In fact today the Salesforce AppExchange is the largest online marketplace of its kind, offering products built on the platform – all 220,000 of them. All products offered on the AppExchange are 100% native to the platform and share an integrated, secure data and identity management model. All go through a rigorous security review and all are equally easy to customize using developer tools available from Salesforce.

Several vendors I follow closely have based their offerings on the Salesforce Platform.

  • Kenandy used it to develop a modern, new ERP for manufacturing from scratch in a fraction of the time it would have taken with traditional development tools. Sandy Kurtzig, Chairman of Kenandy and also the founder of ASK Computer Systems, is an inspiring entrepreneur. My favorite Sandy quote from back in the ASK days (circa 1984): when asked if she was worried about competitors springing up, she said, “No. We’re in the software business. They have to match me line for line in code. Writing software is like having a baby. You can’t put nine women on it and do it in a month.” Yet that is exactly what Sandy set out to do when she started up Kenandy and saw the Salesforce platform as the means by which she could do it.
  • Rootstock, also ERP for manufacturing, switched from NetSuite’s platform to Salesforce.
  • FinancialForce, owned jointly by Unit4 and Salesforce natively developed its accounting solution on the platform and is now expanding more into the realm of ERP.
  • Conversely, Sage has recently abandoned the ERP moniker (but supposedly not its ERP customers) and simultaneously developedSage Live,a brand new “real time accounting solution” built on the Salesforce platform and brought to market in months, not years.

The new “Thunder and Lightning” hyped on stage at Dreamforce will only serve to make the platform more appealing to developers of all shapes and sizes. But just as in real life, while thunder and lightening add dramatic effects to a storm, it is the rain that makes the garden grow. It will be up to the software developers to capitalize on the drama from Dreamforce and make the rain (software) that makes our businesses grow.

Something tells me next year I might just have to brave the crowds at Dreamforce in San Francisco. My days of watching from the cheap seats may be numbered.

Tagged , , , , , , , , , ,

Enterprise Odd Couple: Plex Systems Partners with Workday

Pre-Packaging 2-Tier ERP for Manufacturers

Last week at its annual PowerPlex user conference, Plex Systems announced Plex Connect, along with several new partnerships and packaged connections. The goal of this new open integration framework is to “make it easier for manufacturers to connect people, things and applications to the Plex Manufacturing Cloud.” One of these partnerships stands out as being somewhat unique in that it is forged with another Enterprise Resource Planning (ERP) solution provider… Workday.

At first glance these two might seem like the proverbial odd couple. As another ERP vendor, Workday would appear to be a competitor. But it is not, because Workday is not a solution that is focused on the needs of manufacturers. And companies that “make things” are the only targets for Plex Systems. So if Workday isn’t for manufacturers, why would any Plex customer be interested in connecting to it? Because typically corporate headquarters doesn’t make anything, but might have sophisticated accounting requirements to support global operations. This partnership is all about delivering a pre-packaged 2-tier ERP.

Making the Case for 2-Tier ERP

Operating across a distributed environment has become a way of life for a large percentage of manufacturers today, even smaller ones. In fact 77% of all manufacturers that participated in the 2015 Mint Jutras Enterprise Solution Study had more than one operating location served by ERP (Figure 1). And 67% operate as a multi-national company. Even those with annual revenues under $25 million average just over 2 operating locations and that average grows steadily as revenues grow. This means very few companies today are able to conduct business as a single monolithic corporation.

Each operating division will have operational needs and must then feed to corporate financials for consolidation and reporting.

Figure 1: Environments Are More Distributed and Remote

Plex WDAY Fig 1Source: Mint Jutras 2015 Enterprise Solution Study

Note In Figure 1 company size is determined by annual revenue.

  • Small: annual revenues under $25 million
  • Lower-Mid: $25 million to $250 million
  • Upper-Mid: $250 million to $1 billion
  • Large: revenues over $1 billion

In years gone by all the different operating locations depicted in Figure 1 were likely to be left on their own to evaluate, select and implement a solution to run their operations. However, that scenario is quite rare today. The vast majority (90%) has established corporate standards for enterprise applications (Figure 2).

Figure 2: Have you established corporate standards for enterprise solutions?

Plex WDAY Fig 2Source: Mint Jutras 2015 Enterprise Solution Study

But this doesn’t necessarily mean a single solution runs the whole enterprise. Very often the ERP solution installed at corporate was selected for its ability to report and consolidate across multiple divisions. Very often these corporate accounting solutions (like Workday) don’t have the necessary functionality to run the operations of its divisions, especially if those divisions are manufacturing sites. In these cases, the standard solution for these manufacturing operations is a different solution – one like the Plex Manufacturing Cloud. Hence…

The Emergence of 2-tier ERP

In fact this 2-tier standard has become quite commonplace. Of those that have established corporate standards, less than half (47%) uses a single standard where all units, including corporate headquarters, use the same solution (Figure 3). At the same time, 31% have established a 2-tier standard and another 22% have a multi-tier standard. This latter category is most typical in a diversified corporation where you might see different types of businesses at the divisional level – you might have distribution warehouses or sales and service locations in addition to manufacturing sites.

Figure 3: Is this a single, two or multi-tier standard?

Plex WDAY Fig 3Source: Mint Jutras 2015 Enterprise Solution Study

It is this middle 31% that is targeted by the Plex Systems/Workday alliance, although it might work equally well in the multi-tier scenario. In fact if the non-manufacturing sites are sales and service operations, Workday itself might be the chosen standard for those divisions, eliminating the need for more than two different ERP solutions.

Plex Systems acknowledges that its solution is not the best for non-manufacturers. In fact Plex makes that point in its bold move to implement Workday for its own operations. The initial knee-jerk reaction might be, “What? They don’t sip their own champagne?” (An analogy I much prefer to eating one’s own dog food!) But while Plex knows and serves manufacturing very well, it isn’t a manufacturer. It makes software. While software companies that deliver on-premise solutions might burn CD’s, package them with documentation and ship a physical product to a customer, as a pure cloud provider, Plex sells software only as a service. The accounting for software, services and subscriptions is very different than accounting for shipping and delivering a physical product. But at the same time, this decision also underscores the fact that Plex is not afraid to make the right business decision in managing its own business.

But getting back to the 2-tier scenario, in the past we have seen solutions from SAP and Oracle dominate the corporate scene. Yet solutions like Workday, born in the cloud, are starting to chip away at the dominance of these two major players. And an alliance like this will only serve to accelerate this erosion. Very often a decision for SAP and Oracle might have been influenced by the efforts involved in integrating and rolling up financials from the distributed sites. While these have typically not been “out of the box” in the past, popular sentiment is that if you go with one of these “giants,” you will likely find systems integrators and other service partners who have done it before. That means they have a lot of experience with SAP and Oracle. You still pay for the connection, but you are at least dealing with a higher level of expertise.

With pre-packaged connectors, the need for this prior experience goes away and the expense of forging the connection drops dramatically.

Impact on Roadmap

So after hearing about this and other partnerships (with Salesforce and DemandCaster) the first question I posed to Plex was regarding the impact these might have on their own road maps. In terms of Workday, my specific concern was over enhancements planned to make its ERP more “global.”

Plex already has customers running the Plex Manufacturing Cloud from more than 20 countries, but it has let its customers essentially “pull” them into those countries and doesn’t necessarily support all the localizations and legislative regulations required in each… or all the complexities of growing multi-national companies. About a year ago Plex Enterprise Edition made its debut at PowerPlex 2014 along with an aggressive roadmap to support complex, global, multi-plant manufacturing organizations with multi-entity financial and supply chain management requirements.

In answer to my question, Plex has assured me none of these partnerships will result in taking planned innovation off the table. It will continue to invest in these globalization efforts. Similarly, other solutions such as DemandCaster will not prevent Plex from developing its own forecasting / demand and supply planning software. The alliance with Adaptive Insights will not prevent Plex from developing more robust financial planning and budgeting offerings. But I am thinking Plex doesn’t really need to compete against Salesforce for CRM.

 Conclusion

In the meantime and well into the future, Plex Connect should indeed make it easier for manufacturers to connect people, things and applications to the Plex Manufacturing Cloud. And in today’s connected, digital economy, isn’t that what it’s all about?

A Side Note: Is Workday ERP?

In the past I have posed the question about Workday: Is it ERP? Does it Matter? Many refer to Workday as ERP, but by my definition (an integrated suite of modules that provides the operational and transactional system of record of a business) an integrated finance and accounting solution that does not manage the “order” falls a bit short, But it does manage a contract, which for “talent intensive organizations” including software and Internet service companies like Plex) is equally, if not more important. Feel free to read my full analysis in the highlighted link above but for purposes of our discussion here in terms of 2-tier ERP, I am comfortable in referring to Workday as ERP.

Tagged , , , , , , , , , , , , , ,

Next Generation ERP: Kenandy’s Approach

Changing the World of ERP, One Click at a Time

It has been a while since I last posted in our Next Generation ERP series. If you haven’t been following, you might want to catch up on the 4 part generic series of posts. This one features the approach of a relatively new entrant into the ERP market: Kenandy Inc. Some of you will immediately recognize Kenandy’s founder, none other than Sandy Kurtzig of ASK and MANMAN fame.

By way of introduction or reminder….

What do Star Trek and Enterprise Resource Planning (ERP) have in common? Apart from each being a bold adventure, both have experienced a rebirth as a next generation. In our four part series, we describe the next generation of ERP in terms of new technology that enables:

  • new ways of engaging with ERP
  • custom configuration without programming
  • more innovation
  • better integration

The next generation of Star Trek continued the original journey but was faster, more technologically enabled and more in tune with the evolving needs of the galaxy. When Sandy Kurtzig came out of retirement in 2010 and founded Kenandy, she may not have been thinking about Star Trek but she clearly wanted to explore new worlds in her entrepreneurial journey and boldly go where no ERP for manufacturing has gone before. Using new technology, Kenandy designed its new ERP from scratch with a singular purpose in mind: to deliver a robust solution quickly that would also keep pace with the rapidly changing world in which we live.

Does Kenandy Qualify as Next Generation ERP?

Not every ERP solution on the market today qualifies as a “next generation” ERP. The depth and breadth of functionality has increased over the past three decades, which makes it harder for a new entrant to compete in the market. The “basics” are table stakes, but they aren’t so basic anymore, particularly in the world of manufacturing where Kenandy hopes to compete.

While other industries might be able to survive with back office functionality that is limited to accounting or human resource management, manufacturing requires a much broader set of features and functions. Indeed, ERP for manufacturing has evolved from material requirements planning (MRP) to manufacturing resource planning (MRP II), to the full operational and transactional system of record of the business. Even the manufacturing of a simple product can be quite complex when you run lean, but strive to be responsive to your demanding customers.

Any ERP vendor today must compete on functionality, but that is not what makes a solution “next generation.” It is the underlying technology and the power it delivers.  But technology and functionality are closely related, because it is the power of the technology platform that allows solution providers to deliver more features and functions faster. Selecting the right platform on which to build ERP is therefore critical.

While the platform may not be immediately visible to the end user of the software, it is dangerous to ignore it and the power of technology. You probably never knew how the USS Enterprise achieved warp speed, but you knew that it could. You didn’t know how the transporter beam worked, but you knew what happened when Captain Kirk said, “Beam me up, Scottie.” While neither were the only ways to get from point A to point B, both added speed and efficiency.

While Kenandy chose to build an ERP solution from a clean sheet of paper, in order to compete, it needed to find a way to add both speed and efficiency to the development process. Kenandy chose to build on the Salesforce Platform to deliver both. And in doing so, its customers also benefit from speed and simplicity, which together yield efficiency.

ERP: Empower Real PeopleTM

Speed and efficiency are prerequisites for delivering on the first element of next generation ERP: providing new ways of engaging with enterprise software.

Traditionally, users have engaged with ERP through a hierarchical series of menus, which require at least a rudimentary knowledge of how data and processes are organized. Hopefully this organization reflects how the business processes and the enterprise itself are structured, but with a hierarchy of menus, there are no guarantees that navigation is intuitive or that business processes are streamlined and efficient.

When processes within ERP are clumsy and inefficient, employees spend more time trying to work around the system, rather than working with it. Cynics like to refer to ERP not as “enterprise resource planning”, but as “Excel runs production.” Sandy Kurtzig strives for a different goal where ERP stands for “empower real people.” For that to happen you need to reach both up and down the corporate ladder.

Traditionally, a small percentage of employees of any company ever put their hands directly on ERP, and this select group almost never included top-level executive decision-makers. But the speed of required decision-making and the consumerization of IT are making this unacceptable.

So how does Kenandy empower real people? It relies on the Salesforce Platform to deliver a user experience that is appealing to the younger work force that has grown up on the Internet. And in making the solution appealing to the millennials, it also makes it easier for the older crowd to use. It recognizes there are “mobile” and “social” users as well, both of which are addressed by the platform.

The Salesforce Platform also enables collaboration by connecting people to the business and to information. For years, salesforce.com made a big deal out of its “social” capabilities but the manufacturing community is just now appreciating social. While a hot topic among pundits and industry “influencers,” the perceived value was lost on many, particularly in manufacturing. Traditionalists distinguish between a business event and a social event, between a business conversation and a social chat, between a business colleague and a friend or social acquaintance. Many didn’t “get” that social is really just shorthand for new and improved ways of getting and staying informed in a collaborative way. And who doesn’t want that?

By building an ERP on the Salesforce Platform, these social and mobile aspects are built in.

Personalizing with Clicks not Code

While all manufacturers face similar challenges, they also have unique ways of dealing with those challenges, and in doing so, actively seek differentiation in their individual markets. What company today doesn’t believe it is unique in some way?

Being different used to mean customization and with traditional, older generation ERP, this meant programming changes, mucking around in source code and building barriers to upgrade and innovation. To qualify as a “next generation” ERP, most, if not all of this customization must be done without ever touching a line of source code. Configuration, tailoring and personalization should replace customization.

Kenandy likes to say it can personalize with “clicks, not code.” This means adding fields, changing workflows, rearranging the screens. This is an absolute necessity in a Kenandy environment because it is delivered only as multi-tenant software as a service (SaaS). In a multi-tenant environment, multiple companies use the same instance of (hosted) software. Of course, data is protected from access by other companies (tenants), but any “customization” is generally delivered through configuration settings, which vary per company.

Kenandy’s architecture allows you to modify business processes and the user experience, including screens, dashboards and even the device. This doesn’t require programmers. Simplicity and this “Do It Yourself” aspect were among the primary reasons Blue Clover Devices selected Kenandy. These features became obvious to Blue Clover during its trial run of the system.

“I immediately saw how easy it is to add and extend capabilities with Kenandy,” said Pete Staples, President and Co-founder. “I was convinced that this was something we could manage pretty much on our own, and that had a strong appeal to us.” While the other system Blue Clover was considering had many positive features, “We felt like we would have to hire them to do everything for us, and that just made us nervous.”

Beyond the Initial Implementation

While this level of personalization and configuration is important when Kenandy is first being implemented, it becomes even more so as life goes on. Today’s manufacturers are bombarded with change, whether as a result of growth, regulatory requirements or just the desire for continuous improvement. Change doesn’t halt once you implement ERP. In fact, the need for change may accelerate as new functionality and new technology opens doors for growth and improvement.

And yet managing change has traditionally been an obstacle to achieving the goals of an ERP solution. The 2014 ERP Solution Study found this to be the number one challenge with the vast majority (82%) rating it as moderately to extremely challenging.

The ability to handle this kind of change was the primary reason Big Heart Pet Brands (formerly Del Monte Foods) selected Kenandy to support its recent acquisition of Natural Balance Pet Foods. “One of the many reasons Del Monte selected Kenandy was that we wanted a flexible system that easily adapts to business changes, such as acquisitions, while also offering enterprise-class capabilities,” said David McLain, Senior Vice President, Chief Information Officer and Procurement Officer, Big Heart Pet Brands.

Kenandy attributes this post-implementation agility to the flexibility and extensibility of the platform and Stuart Kowarsky, Vice President of Operations at Natural Balance seems to be a big fan. “At Natural Balance and in our corporate systems, we’re replacing a patchwork of applications with one unified, extensible solution that will grow and scale with Big Heart’s needs.”

But Kenandy’s ability to accommodate change is not only attributable to the platform, but also to how it has architected the solution on top of that platform, with a unified data model that takes full advantage of the power of business objects.

“Wide-Body” ObjectsTM

Legacy ERP solution data models consisted of an extensive number of tables. Joining those tables together reflected relationships between data. For example, a sales order header table might need to be joined to line items. In turn, those line items needed to be joined with the products being delivered, and any number of associated tables for validation, like units of measure, product categories, inventory locations, planning and replenishment codes, etc. The sales order also had to be joined with customers, shipments, and invoices. It didn’t take long for the number of tables and joins to proliferate almost exponentially, making a change to any one element a labyrinth of changes.

Kenandy replaces that myriad of tables with what it calls a ”Wide-Body” ObjectTM architecture.  These objects will sound quite familiar: orders, invoices, customers, etc. But by packing lots of information into each object, it significantly reduces the number that needs to be managed. Kenandy has less than 100 Wide-Body Objects.

For example, invoice, credit memo and adjustments share similar data structures and therefore can be expressed as a single object, distinguished by embedded fields. Adding fields is a simple process and only has to be done in one place. Changing workflow steps is equally simple because the workflow connects directly to the objects. Also, these Wide-Body Objects are reusable and it is a simple process to make these changes by pointing and clicking. No database administrator (DBA) required.

More Innovation to Come

The ability to enable change this rapidly also has implications for the on-going development of the product, which impacts the third requirement for next generation ERP: more innovation.

In deciding to build a new product from scratch, Kenandy avoided a lot of the headaches other longer-tenured companies face. In developing a new product, you don’t have to worry about keeping any existing customers happy with product or implementation decisions they may have already made. You can start from a clean slate. It is sort of like building a new house. It is much easier to start with an empty lot and a design plan, than it is to remodel an existing structure.

And yet Kenandy set out to build a very big and complex structure. As noted earlier, the depth and breadth of functionality needed to compete today, particularly in manufacturing, is extensive.

The platform itself comes with an extensive toolbox that accelerates the development process. The power of the platform, combined with its SaaS-only delivery model, supports agile development, managed around “sprints,” a concept familiar to proponents of rapid application development. Innovation doesn’t have to be packaged up to be delivered every 12 to 18 months, but in shorter cycles that include scripting a scenario, designing a solution, building and testing. Think of these more as a series of short proof of concept projects, which are continually being delivered. As a SaaS model, no customer is left behind running an older release.

In an interesting twist on “agile” and “sprints,” Kenandy applies these same concepts to the implementation process. New customers gain access immediately to an instance of the software. They can add data, experiment and test it out in a series of pilots. At the end of the process, teams not only have a working environment, but also have learned how to make changes to business processes, again with clicks, not code. Nothing is cast in concrete as the first (or any) “go live” milestone is achieved, therefore it encourages and supports the popular manufacturing concept of continuous improvement.

These were some of the benefits Del Monte saw in its recent acquisition of Natural Balance. Indeed, Sandra Kurtzig was so confident in Kenandy’s ability to respond quickly, she made a commitment to Del Monte to go live with Kenandy at Natural Balance just 90 minutes after the acquisition was complete. No, that’s not a typo – that’s 90 minutes, not 90 days. In fact, the system was up and running in less time and represented a complete implementation including order-to-cash, planning and production, procure-to-pay and financials.

Summary

Like the starship Enterprise, whose five-year mission was to explore new worlds and “to boldly go where no man has gone before,” early versions of ERP charted new territory for enterprise applications. It evolved from MRP (material requirements planning) to MRP II (manufacturing resource planning) and then boldly set out to conquer the “final frontier” of ERP, managing not a small piece of the enterprise, but the enterprise itself.

The new journey Kenandy has embarked on, this next generation ERP, is a far cry from legacy ERP solutions of the past. Not wanting to be constrained by legacy code or preconceived notions, it started with a clean sheet of paper to design a whole new solution. But this new company knew better than to take a further step back in designing its own development platform. Instead it chose a platform that has already proven itself in terms of power, flexibility and reliability.

When Sandy Kurtzig stepped down from her first venture (The ASK Group) she left behind a loyal following within the manufacturing community, where trust is not easily given, but is hard earned. Can she attract the same kind of following in her new venture? In order to compete in this new era she will need:

  • A proven technology platform that allows users to engage with ERP in new and different ways, with intuitive and visually appealing user interfaces, which don’t rely on intimate knowledge of how the system or the data is structured. She’ll need a platform that opens doors to a whole new level of executive involvement… Check
  •  A system that is easily custom-configured, eliminating invasive customization that prevents companies from moving forward with updates and upgrades… Check
  •   To deliver innovation at an increased (and impressive) pace, supported through the use of web-based services, and object-oriented data models… Check
  •  Good integration capabilities that provide a seamless user experience across the enterprise… Check

Manufacturers stuck on older technology with limited functionality might well consider saying, “Beam me up, Sandy.”

This post was derived from a white paper entitled Next Generation ERP: Kenandy’s Approach. Click here to read the full report. The report is free, but registration is required.

 

Tagged , , , , , , , , , ,

Infor’s Inforce Everywhere Completes Salesforce’s 360 Degree View of the Customer

 

Today (March 12, 2012) Infor announced general availability of Inforce Everywhere. Built natively on Force.com and ‘ION-ized’ with Infor’s lightweight middleware platform, Inforce Everywhere brings the back office data from selected Infor Enterprise Resource Planning (ERP) solutions safely and securely onto the screens of Salesforce.

While Customer Relationship Management (CRM) solution providers have been touting a 360o view of the customer for over a decade, this complete view is actually impossible just using CRM. Shipments, invoices, accounts receivable and returns are the domain of ERP, not CRM. Many companies today would like to turn sales reps into true account managers, but allowing a sales representative full access to ERP is enough to cause any Chief Financial Officer (CF)O) heartburn. By making this type of data accessible directly, selectively and securely through CRM, Infor helps sales reps really manage accounts without purchasing additional ERP seats and without opening the floodgate to ERP.

Infor’s Reseller Agreement

Fast facts:

Infor will provide support to customers that license Salesforce via Infor

Products that Infor will resell include:

  • Sales Cloud, Enterprise Edition
  • Service Cloud, Enterprise Edition
  • Salesforce Sales/Service Cloud related products such as Mobile, Portal, Sandbox, API calls, etc.

The INFOR:SALESFORCE Partnership

The partnership between Infor and Salesforce was originally announced at Dreamforce on September 1, 2011. The intent to build and deliver Inforce Everywhere was part of a three-way announcement including:

  • Three new Inforce applications including Inforce Everywhere, Inforce Ordering and Inforce Marketing
  • A reseller agreement which also extends to Infor’s partners
  • Salesforce investment in Infor

In a way, this partnership is just one of many Salesforce.com is striking these days in expanding beyond the boundaries of CRM and evangelizing its vision of the Social Enterprise. But the deal with Infor stands out in a couple of ways.

First of all the reseller agreement is very unique.  Infor has the ability to resell Salesforce Sales and Service cloud licenses as well as the native applications they develop on Force.com.  Salesforce.com has a very robust ISV ecosystem of partners developing and selling solutions that include Force.com, but only a select few have the right to position and sell Sales and Service cloud as well. This means Infor takes the order, delivers the product (as a service) and provides front line support. This reseller agreement also extends to the Infor channel, which is being actively developed and expanded. Partners can resell the portfolio but will only be allowed to provide implementation services if certified to do so.

Salesforce.com’s investment in Infor is not unique and signals the company’s interest in expanding Force.com solutions and its influence beyond the realm of the front office. FinancialForce.com (accounting applications) and Box.net (content management and storage) are two other examples, but this is the first and only major ERP company that Salesforce has invested in.

But the products being developed are perhaps most important to both Salesforce’s and Infor’s existing customers. In the world of enterprise applications, partnerships can be very easy to form but often never move far beyond the original fanfare of the announcement. Very often these partnerships are just referral-based. They are easy to form, but just as easy to walk away from. A reseller agreement further cements the relationship, but the bond truly forms when solutions are developed and integrated. The two most important factors are moving quickly and adding real value.

Inforce Everywhere has been developed and is being delivered in just over six months from formalization of the agreement and new releases are already planned for Q3 2012 and Q2 2013. It effectively marries the front and back office, exposing data from ERP to the Sales and Service Cloud. The other two Inforce products are planned for release in Q4 2012 (Inforce Ordering) and Q1 2013 (Inforce Marketing).

Infor is also introducing Salesforce.com’s vision of the social enterprise to the ERP world with Chatter in a way that makes sense to its ERP customers. By exposing data in ERP to users of Salesforce, Inforce Everywhere is encouraging a dialogue between the front office and the back office and Chatter will enable it.

How Does this Add Value for Customers?

Many companies today talk about the need for a 360o view of their customers. But getting that complete view is hard and allowing a sales rep access to this level of visibility is even harder. Yet in those businesses that thrive on developing close relationships with their customers, the role of the sales rep must be transformed into that of an account manager. By managing an account, you provide better service, generating customer satisfaction and loyalty, which in turn generates more sales and revenue.

To truly manage an account you need visibility to customer history, outstanding orders, shipments, open accounts receivable, payment history, and service performance. While account management and customer service are engagement-based, this history is transaction-based. Transactions don’t exist in a system of engagement (CRM); they exist in a system of record (ERP). Yet how many companies do you know that are willing to purchase an ERP seat for every sales rep? How many CFO’s do you know that are willing to allow sales reps open access to areas like accounts receivable?

Access to accounts receivable in ERP usually means access to all accounts receivable. While this is not always the case and role and context-based security is more common in ERP solutions today, the implementation of this level of security is not yet pervasive. At the same time, access to customers, orders and quotes through a CRM system generally is restricted to those customers “owned by” the sales reps. So doesn’t it make sense to offer this level of visibility through the existing structure of a CRM?

That’s what Inforce Everywhere does. It exposes that detail that already exists in ERP about customers, shipments, returns, invoices and open balances and makes it visible through secure inquiries within CRM. But the sales rep/account manager is confined to his or her own customers/accounts and doesn’t need to consume an ERP user license. There is no need to purchase seats in ERP to gain access to this data. Infor customers need only subscribe to Inforce Everywhere, which is priced at $30 per user per month.

Some of the data shared between ERP and CRM is shared bi-directionally, while some is single direction. For example, data about sales territories, accounts and contacts is shared bi-directionally. Products, system codes, quotes, orders, shipments, invoices, accounts receivables, return material authorizations are single direction – data in ERP is shared with CRM.

Added value is also derived from Inforce Everywhere in a multi-company scenario. While business units or divisions that cross international boundaries must be established as different legal entities in ERP for financial reporting and compliance purposes, often CRM must have a view across these entities from a corporate, global perspective. Global accounts may be managed across legal entities and international boundaries, so it is important to have visibility worldwide. While this seems simple enough on the surface, delivering this is not so simple. Inforce Everywhere can serve as the link, establishing an optional one-to-many relationship between CRM and ERP. This multi-company scenario will be supported in Q3 2012.

Which ERP Solutions and How?

Inforce Everywhere is currently available for Infor10 ERP Enterprise (LN), Infor10 Distribution iBusiness (A+) and Infor10 Distribution Business (SX.e). XA, Syteline and Visual are planned for release next quarter, followed by S21, Sun Systems, LX, (Lawson) M3 and Adage before the end of the year. Additional Infor ERP applications are planned to be rolled out later.

How is Infor able to produce this steady cadence of releases? Infor10 ION, Infor’s lightweight, middleware platform, is the key to connectivity between ERP, CRM and any other ION-enabled application, eliminating the need for individual point-to-point integration. Think of it as a layer of meta data that can connect Salesforce to potentially any or all of the Infor ERP back office solutions. Each solution need only to expose data to the meta data layer to make the connection, so any ION-ized Infor solution is easily connected.

Key Takeaways

Salesforce has slowly been infiltrating the customer bases of many of the ERP solution providers, especially those that have targeted the mid-market. While ERP solutions have continued to broaden, touching more and more functional areas within an enterprise, they have largely been viewed as back-office solutions. Satisfying the needs of the sales department has often been an afterthought or largely ignored in ERP implementations. As a result, sales departments have sought out their own solutions, sometimes with the blessing of the Information Technology (IT) department and sometimes doing an end run around IT. A cloud-based solution like Salesforce has provided a very viable alternative.

While it is not clear exactly how much overlap there is today between the Infor and Salesforce customers, one would have to assume it would be substantial. That overlap will be target number one for Inforce Everywhere and should be an easy sell.

Where there is no overlap, putting Salesforce Sales and Service cloud portfolio in the hands of the direct and indirect sales force provides them with more to offer the customer. Sure they could buy CRM directly from Salesforce, but the introduction of Inforce Everywhere keeps the sales department happy, but implicitly keeps them in the fold in terms of sharing data and added visibility.

 

Tagged , , , , , , ,