SAP Imposes Single-Tier ERP Support Program

July 16, 2008 from eWeek – “SAP is taking a one-size-fits-all approach to product maintenance, in which customers of all sizes will be switched to an Enterprise Support program regardless of their size or IT budgets.

SAP will start transitioning current customers into Enterprise Support this month at no additional cost, but it will start phasing in pricing for this level of service at the rate of 8 percent per year over the next four years starting in 2009, until it reaches the standard cost of 22 percent of product license fees…

SAP contends that the cost of Enterprise Support is below the average maintenance fees charged by other software companies. Cordrey said that the phased-in price increases will help make Enterprise Support affordable for customers of all sizes.

Enterprise support provides a 24/7 service-level agreement, continuous quality checks, produce support advisories, and advanced support for implementing ERP application enhancements and support packages.”

180 View – We anticipate a backlash on 22% product maintenance from SAP customers. We think that maintenance fees will become one of the more important criteria in selecting a new system. Organizations in the selection process should be evaluating NPV (Net Present Value) over 5 years to make a cost comparison between systems. But make sure that vendors have disclosed all maintenance and support fees, which are sometime charged separately.

What is your ERP solution NOT doing for your organization?

2008 White Paper from Exact Software – “Most organizations have already implemented Enterprise Resource Planning (ERP) to streamline manufacturing, distribution, and financial processes. However, existing ERP technology has left them frustrated in their efforts to extend the same level of efficiency throughout the entire organization. Valuable information about customers, employees, vendor relationships, andmore is typically locked within silos—fromindividual databases to file cabinets to employees’ desktops. Moreover, traditional ERP systems don’t encompass interactions with outside parties such as customers, suppliers, and business partners. While ERP does a fine job of tracking manufacturing, distribution and accounting processes, businesses need to understand the context behind these transactions to truly maximize efficiency and effectiveness…”

180 View – Although the Exact White Paper does indirectly promote their system, it also contains useful information about ERP trends.

IFRS - Time to get moving

June 2008 from CAmagazine – “According to a recent CICA survey the vast majority of Canadian publicly accountable enterprises are closer to the starting gate than to the finish line when it comes to preparing for the transition to international financial reporting standards (IFRS).

The survey was conducted in March with 550 senior Canadian executives who are chartered accountants, almost 300 of whom must report using IFRS by 2011. Only 8% of those executives indicate they have begun the conversion process; while 72% have not yet reached the stage of assessing the impact of IFRS on their operations…”

180 View – Every problem for someone is an opportunity for someone else. You can bet that the consultants, auditors and ERP software vendors will reap IFRS benefits other than the benefits intended.

Microsoft Ships New Release Of Its Dynamics AX Applications

June 4, 2008 from ChannelWeb – “Microsoft has begun shipping Microsoft Dynamics AX 2009, a new release of the vendor's ERP application suite with new globalization functionality and tools for tailoring the applications' interface for specific user roles.

Microsoft previewed Dynamics AX 2009 at the vendor's Convergence conference in March. Dynamics AX is geared toward upper mid-market customers that have operations in multiple locations, particularly those in manufacturing, retail, distribution and professional services...

The software also uses business intelligence technologies to provide users with key performance indicators based on their roles. And Dynamics AX 2009 more closely resembles the familiar Microsoft Office...

Also offered in Dynamics AX 2009 is a new compliance center that provides a single view of internal controls, KPIs and other information needed to comply with company policies, local legislation in 36 countries and such regulations as Sarbanes-Oxley. The system also incorporates Microsoft's Windows Workflow Foundation technology for documenting workflows -- expense report management, for example -- and creating an audit trail. The software also provides more support for companies that operate multiple sites within a single country and across multiple countries."

180 View – We think that existing users will be eager to upgrade, and the new version will give SAP and Oracle a run for their money in the upper end of the mid market.

NetSuite Eyes Midsize Manufacturers

June 12, 2008 from eWeek – “Called NetSuite for Manufacturers, the package is part of NetSuite’s effort to compete with SAP for small and midsize companies in vertical markets.

The time is right for NetSuite to release this package, said Mini Peiris, NetSuite’s vice president of product marketing, because SAP doesn’t have a manufacturing suite that is scaled for the budgets of most midsize manufacturers.”

180 View – NetSuite is on a roll. We have not seen their manufacturing suite yet, but anticipate that it will appeal to light manufacturers. Sounds like another good move by NetSuite.

You’re Not Tiger Woods!

March 26, 2008 from AMR Research – “What do software and golf have in common? A lot, actually…Companies can buy all the enterprise software they want, but unless their companies are performing well to begin with, as Tiger Woods is, that software isn’t going to help a whole lot. To most companies, these investments are a cost without an ROI...”

180 View – The article does make a few good points as to why ERP systems fail to deliver ROI and is interesting. However, it’s not clear whether the conclusions drawn can be generalized based on the surveys conducted. Were the surveys for organizations spending millions of dollars or done 5 years ago or for companies with complex processes not found in a typical survey?

Another problem is the suggestion to improve the operational efficiency of the business processes before purchasing new software otherwise you will just have an automated mess. The implication is that organizations should re-engineer their business processes before implementing a new system. This is bad advice for most companies. You could develop the best processes and find that the costs of their implementation would be prohibitively expensive. Why not leverage the business processes already implemented by the ERP vendors than start from scratch? Why re-invent the wheel every time? There could be a few unique processes that make an organization successful, which may require some new processes, but there is a lot of similarity between companies in the basics.

BlackBerry gets new CRM goodies thanks to RIM-SAP alliance

May 5, 2008 from IT Business.ca – “SAP and Research in Motion have teamed up to bring SAP's back-end business applications, beginning with CRM, to BlackBerry devices… SAP's CRM is the first application that will run natively on the BlackBerry, but eventually the companies plan to build mobile versions of SAP's applications -- including ERP (enterprise resource planning) and supply chain -- for BlackBerry devices, said Bill McDermott, president and CEO of SAP Americas, Asia Pacific and Japan.”

180 View – ERP in the palm of your hand with access anywhere anytime sounds good to us. The only concern is ERP will need to be dummied down to make it easy.

Five things to know before committing to SAP

May 8, 2008 from itWorld Canada – “Installing SAP applications is not easy. Employees who are capable of deploying and maintaining SAP software are in extremely valuable and practically form a whole profession by themselves.

SAP, which built its reputation with ERP software, is rarely chosen by enterprises for one-off applications, AMR Research analyst Jim Shepherd notes in a report this month titled "The five SAP strategies that you need to understand." "For huge organizations, this is typically a multiyear, multimillion-dollar effort to transform the business," he writes. Unfortunately, executives often pay little attention to SAP installations after they are deployed, he adds. That's a big mistake. Let's take a look at the five SAP strategies Shepherd details in his report, and how they affect your technology decisions…”

180 View – Despite bad press, SAP keeps on truckin. The thing is they had the vision and ability in early ERP days to build systems that would work across large organizations with complex business and infrastructure. Decision makers are risk adverse and think that if it works for the best companies (as the SAP ad says), then it will work for me. Another compelling reason to go to SAP is that the most well known and trusted consulting and accounting firms were on board and would help with the implementation.

SAP won the first ERP War fought over automating business across departments, Client/Server technology, and support for multiple databases and operating systems. We are now in the midst of the second ERP War being fought in the trenches of ease of use, web based architecture, SaaS, embedded BI and CRM, customization outside of source code and integration tools.

Integration Woes

April 2008 from CAmagazine and written by Michael Burns – “Integration still is the No. 1 problem facing many organizations that require more than one internal system…”

Five misconceptions about ERP

April 2008 from Manufacturing Automation and written by Michael Burns – “There are so many misconceptions about ERP, it’s a wonder that the acronym has not been replaced. Are you guilty of harbouring one of those misconceptions?”

Leading waste hauler sues SAP claiming ERP rollout a 'complete failure'

March 27, 2008 from ITBusiness.ca – “The trash disposal giant, Waste Management is suing SAP over an ERP implementation it dubs "a complete failure." In its court complaint, Waste Management said senior SAP executives, including SAP Americas' president and CEO, Bill McDermott, participated in the "rigged and manipulated" demos.”

180 View – It’s hard to believe that SAP would intentionally rig or manipulate a demo. A canned demo is apparent if you are asking questions. The demonstrator will be unable to show anything other than what was planned. It’s also unlikely that SAP would have answered specific functionality questions dishonestly. That would be a big problem in court. It would also be a big problem during the selection process if the truth was uncovered as the decision is largely based on trust. But perhaps the requirements were not well defined. And perhaps SAP was not forced to be specific in responding to requirements. A “Yes” can mean many things including out of the box functionality, third party, customization or workaround.

It’s not to say that the vendors are always blameless. We have recently heard a number of horror stories of failed implementations. In these cases, the problem lay with the Value Added Reseller who promised the world and failed to deliver. One question raised by these failures is to what extent the developer should be responsible for the failures of their Value Added Resellers. Many of the developers have certification processes, but it’s no guaranty. We would like to hear your thoughts on this.

SAP and Oracle: Who’s Ready for Small and Medium-Sized Businesses?

June 2007 from Nucleus Research – “Who’s’ delivering the greatest value to the SMB market? An in-depth analysis of 56 customers showed significant differences between the value delivered by SMBs by Oracle and SAP today…”

180 View – If you read the article you will find that 44% of the Oracle respondents would recommend Oracle to their peers. If you think that’s bad, only 10% of SAP customers would recommend SAP. Is SAP getting a bad rap? Perhaps based on a limited survey base or because SAP’s midmarket systems were not included. I (Michael Burns) have used SAP at Ryerson University to demonstrate ERP concepts. I think SAP would overpower most SMB’s. SAP does offer All-in-One, which is preconfigured for a specific industry and would reduce the setup hit. Also SAP has two SMB solutions – SAP Business One and ByDesign.

Managing change the right way

April 2008 from CAmagazine and written by Michael Burns – “Many will tell you change management is critical to the success of any project and especially to the implementation of a new system. In fact, you can find consulting firms that specialize just in change management. But in my view, change management sometimes gets blown out of proportion based on false assumptions about employees…”

Microsoft Convergence

March 24, 2008 based on an interview of Joel Martin, Microsoft ERP Product Manager – a recent Microsoft recruit who was previously an analyst with IDC Canada. Microsoft should be commended on hiring Joel who brings deep knowledge of enterprise software based on his IDC experience. Joel spoke to me about Microsoft’s annual conference for Dynamics partners and customers, Convergence 2008, which was held in Orlando from March 11-14. The conference continues to grow with a record-breaking 9,600 attendees this year.

Scheduled for release in June 2008, Microsoft Dynamics AX 2009 was a hot topic at Convergence 2008. In the new version, Microsoft has added functionality and improved user productivity through new role-tailored interfaces and integration with other Microsoft technologies. The improvements in the user experience brings Dynamics AX 2009 in line with the user interface of the other Dynamics applications. When asked about target markets, Joel described AX as Microsoft’s system for the upper end of the mid market, mid-size and enterprise customers in manufacturing, distribution, professional services, and retail. These organizations typically have multiple sites and are present in more than one country.

Another announcement at Convergence 2008 was that Microsoft will offer a set of migration tools developed to help companies that have outgrown their small business accounting software, such as Intuit’s Quickbooks, and move to Microsoft Dynamics GP within a fixed price and fixed scope.

Joel also confirmed that ‘Project Green’ has now concluded. Going forward, rather than a ‘net new’ product, Microsoft is focusing on incremental advancements on all four Dynamics ERP platforms. One example is the company’s ongoing delivery of role-tailored user interfaces across all application releases.

Using SYSPRO with Microsoft Office

March 25, 2008 based on a demonstration – SYSPRO recently released SYSPRO Office Integration (SOI), which allows anyone in an organization, regardless of whether SYSPRO is installed on their workstation, to access information directly from the SYSPRO database within a Microsoft Office product such as Word or Excel. Once the information has been displayed, it can be inserted directly into the current document either as simple text or as a table. What’s good about this is that it respects the security of the system so that employees can only access what they would be able to access were they within the SYSPRO system. What’s also good about it is that it’s free. Another plus is that SOI uses web services to communicate between Office and SYSPRO’s database, which means that you can work with an Office product at home using an Internet connection and still have access to the SYSPRO data. Even Microsoft, a competitor, thought SOI was good and included it in a presentation made at Microsoft’s recent partner conference. See http://www.microsoft.com/presspass/events/devcon/docs/ODC2008EvidenceDeck.ppt

Midmarket Companies Should Clarify Requirements for Process and Information Support to Avoid ERP System Selection Errors

January 2008 from Gartner Research and available from Epicor - Key Findings of this research include:

• "Midmarket companies are not small and simple. They have some specific and individual strategic processes
• Because of the limitation in IT resources, mid market companies are willing to accept “good enough” functional for their nonstrategic processes"

Gartner recommends that midmarket companies consider the scale of operation and strategic importance in the selection process and not to select systems that are overkill.

180 View – We agree that midmarket companies need to prioritize their requirements but have trouble with using scale and strategic as criteria. Although a midmarket company may not have many transactions related to some processes (IE low scale), the automation of these processes could provide huge benefits. Same goes for strategic – a process may not be strategic, but improving its business process may also provide huge benefits. We think taking a business case approach is the way to prioritize. A critical requirement is one which will allow a company to be significantly more effective (allow the company to achieve its Critical Success Factors – those things it must do well in order to be successful) or significantly more efficient (do more with less resources). As well, we think the same advice goes for large/enterprise organizations to prioritize based on business case.

180 Systems launches three new web sites

ERP Portal

The objective for this site is to provide an unbiased portal to ERP (Enterprise Resource Planning) systems, ERP Value Added Resellers (VAR's) and relevant ERP articles.

CPM/BI Portal

The objective for this site is to provide an unbiased portal to CPM (Corporate Performance Management) and BI (Business Intelligence) systems, CPM/BI Value Added Resellers (VAR's) and relevant CPM/BI articles.

BPI Portal

The objective for this site is to provide an unbiased portal to BPI (Business Process Improvement) systems and relevant articles. BPI is about efficiency and effectiveness as well as about GRC (Governance Risk and Compliance).

Ballmer outlines Microsoft's enterprise ambitions

March 12, 2008 from Computerworld – “CEO Steve Ballmer used his opening keynote at Microsoft Corp.'s Convergence user conference here not only to preview a number of updates to the company's Dynamics line of business software, but also to make a firm declaration of Microsoft's enterprise market plans.

"I still get asked, is Microsoft a serious player in business applications? ... This is mission-critical for us," Ballmer asserted. "The biggest decision I made -- unless we close this Yahoo deal -- was pushing into the business applications area," he said at another point…

One product, Microsoft's Dynamics AX 2009, is set for release in the first half of this year. New features include integration with Microsoft's unified communications platform; a "one-stop shop" for data related to compliance issues; an integrated workflow framework; and broader localization and globalization capabilities, such as support for multiple languages and time zones.”

180 View – It appears that Microsoft AX is getting most of the attention so far at the conference. AX is positioned at the high end of Microsoft ERP systems and now competes head on with SAP and Oracle.

Canadian enterprises go vertical with ERP

March 11 from ComputerWorld Canada – “Canadian customers gathered at Microsoft’s Dynamics-based Convergence conference in Orlando, Florida Tuesday to discuss their recent implementations of Dynamics NAV-based products, which executives said highlighted the popularity of vertical-specific ERP and updating old technology…”

180 View – Initially we did not think that Microsoft would succeed in the ERP marketplace because Microsoft can’t be all things to all people/industries with one system and keep it relatively simple to use. However Microsoft’s strategy to extend the core product to specific industries using their business partners will go a long way to make Microsoft leader of the ERP pack at least for mid market organizations.

Microsoft Dynamics: management changes spell lack of direction

January 17, 2008 from the Enterprise System Spectator – “Jeff Raikes, head of Microsoft's Business Division (which includes its enterprise applications group), is leaving Microsoft. Once again, the future of the Dynamics products (Axapta, Great Plains, Solomon, and Navision) is clouded by leadership issues.

Raikes joined Microsoft in 1981 and has been one of the most influential leaders at the software giant, after Bill Gates and Steve Ballmer. However, enterprise applications have never been his forte. His main responsibility was Microsoft's Office products. The Dynamics products were added to his portfolio in 2005 in a reorganization that pushed aside Doug Burgum, former CEO of Great Plains. Burgum later left Microsoft in 2006.

The current head of the Dynamics group, Kirill Tatarinov, has only been in the job for about seven months. He will now have a new boss in the person of Stephen Elop, who is a Microsoft outsider: he was the former CEO of Macromedia/Adobe and most recently at Juniper Networks.
The main problem I see in the leadership changes at Dynamics is that none of the players since Doug Burgum have any experience whatsoever in enterprise applications. As I've said in the past, selling shrink-wrapped software--whether it be Microsoft's or Adobe's--is a far cry from selling enterprise applications that require months of presales team effort.

It's a shame, because Dynamics is a good set of products. They just need the right people in the lead at Microsoft..."

180 View – We have also seen some very good senior people leave Microsoft. At the end of the day, it’s people that make a product successful. If the mothers and fathers who built the company/system leave, their baby is more likely to have problems of one sort or another.

Top 10 implementation mistakes

January 2008 from CAmagazine and written by Michael Burns – If you read last month’s article (see “Top 10 software selection mistakes,” www.camagazine.com/softwareselection), you will know the software purchase process is riddled with pitfalls. But don’t expect implementation to be any easier. The article discussed the 10 top implementation slip ups you can make.

Oracle's earnings soar

December 20, 2007 from ComputerWorld – “Robust software sales pushed Oracle Corp.'s second-quarter net income up 35% compared with the same period last year, to $1.3 billion (U.S.), or 25 cents per share, the company said Wednesday. Total revenue grew by 28% to $5.3 billion, Oracle said…

CEO Larry Ellison added that Oracle is finding new business by targeting vertical industries that may not be using packaged software like the kind Oracle sells. "Some of these verticals are almost green fields in terms of modern software," he said. The company's president, Charles Phillips, echoed Ellison. "We think we're very early on in this strategy," he said. "We're still selling in the verticals who are building applications. We're trying to convince them to buy packaged applications."

180 View – Good move by Oracle in targeting the verticals. But how do you take an already complex software system, add more functionality and create something that will not be too onerous to implement? As well, verticals require more than just software; the implementation team also requires industry expertise.

Top 10 software selection mistakes

December 2007 from CAmagazine and written by Michael Burns – “For many companies, replacing a system is like going to the dentist: necessary, but potentially painful. Often, you can stave off the need for replacement with preventive action such as upgrades. But if the system is no longer supported, or if there has been a change in the business that renders it inadequate, you have no choice but to go to market. And when you do, it’s easy to make big mistakes. Here are the biggest ones…”

Software Evaluation and Software Selection

December 17 from TEC – “It is daunting for corporate IT buyers to discern the true capabilities, strengths, and weaknesses of a given enterprise application suite. Buyers’ project teams are inundated with marketing information from vendors struggling to differentiate themselves. Functional cross-over and software integration have caused product overlap and a lot of confusion in the market. Mergers and acquisitions are also creating problems, as companies cannibalize the competition to gain access to a client base or functionality, which may result in solution overlap or forced migration. As a result, organizations are surrounded by ambiguity when making their implementation decisions.

Evaluating and selecting enterprise software is a complex process characterized by both striking potential and dramatic risks. Executed properly, this process and its outcomes can deliver exceptional benefits. If executed poorly, however, the results can range from disappointing to devastating. Organizations that select the wrong hardware, middleware, or software will learn the hard way that the money they’ve lost is a result of inadequate vendor information and evaluation processes. Such losses are increasingly apparent within price-sensitive, small and medium enterprises, which require accurate IT information to be collected quickly and cost-effectively during the software evaluation process. Vendor’s hype, consultants’ conflicts of interest, user doubt, tediously long selection processes, and unclear decision rationale are some of the unfortunate watchwords for most selection processes.”

180 View – The article is clearly self serving to TEC in that they offer a potential solution to avoid the problems that they describe in the article. “TEC’s evaluation centers (online decision support tool) support the analysis and comparison of thousands of criteria on hundreds of vendor solutions that have been vetted by TEC’s analysts, using industry standards and benchmarks. Because vendors respond to TEC’s RFIs without a project in mind, the responses are more typical of their capabilities.” TEC also lets users “prioritize their needs in a manner that gives greater priority to criteria that are considered more important.”

You should know that TEC is in some ways a competitor of 180 Systems. We have not spoken to any of their customers about the usefulness of their services or used it ourselves. Our first impressions are that we find it hard to believe that they have vetted thousands of criteria on hundreds of vendors. Second we don’t think that the vendor’s responses will be more typical of their capabilities because they are responding to TEC's RFI. Rather, we think the vendor will be more forthright when respondong directly to a customer RFP if the questions are specific. The vendor must be honest or trust will be lost, and the decision in the end is mostly about trust. We also note that their priority system is at a very high level – for example financial systems rather than at a more detailed level, which we believe could lead to misleading results. Nevertheless, we recognize that TEC may have a useful role to play in a selection project even if it means that a potential client would use their services rather than the services of 180 Systems.

Lately we have been thinking that we should also provide a similar service to TEC based on our extensive knowledge base. We would like to hear from our readers about their experience with TEC and whether we should offer something similar.

SAP Buys Business Objects for $6.78 Billion

October 8, 2007 from PC World – “The acquisition is intended partly to help SAP reach an ambitious goal of doubling its customer base to 100,000 by 2010. Schwarz said about 40 percent of Business Objects' customers are using SAP today. Business Objects has roughly 45,000 customers, suggesting SAP will gain about 27,000 new customers through the deal.

SAP has made some progress with its own business intelligence software, including an analytics engine called BI Accelerator. But Business Objects excels in ease of use and user interface technologies, which will become increasingly important to BI in the future, IDC's Lykkegaard said.

"Business intelligence in the future will increasingly become a user interface for applications," he said. "You'll do your analysis from the BI interface and then dive directly into the transactional data you want to examine."

180 View – For those of you who don’t know Business Objects, you do probably know Crystal Reports, which was acquired by Business Objects in 2003. We think it’s going to be a hard swallow by SAP in that Business Objects has multiple products that overlap not only themselves but also with SAP’s existing business intelligence tools. Also difficult will be supporting all the competing ERP vendors that rely on Crystal reports.

Caveat Emptor: The Impact of Vendor Consolidation on Business (Corporate) Performance Management Buyers

October 17, 2007 from Business Intelligence Network – “In the enterprise market, end users now have fewer choices. If you wish to purchase from your preferred database or ERP vendor, Oracle, SAP, Microsoft, Infor and mid-market focused Exact Software each have a value proposition and products worthy of consideration. The companies recently acquired by these vendors will each attempt to maintain their “open” status regarding connectivity to other transactional systems, but depending on the company, that may get more difficult over time. If you wish to buy your performance management and business intelligence applications from a source database independent vendor, Cognos, SAS, and Clarity Systems are the leaders left standing – for now. In addition, for mid-market to small businesses, there are still plenty of choices. Less well known, but still enterprise-strength KCI has successful clients in the upper end of mid-market to enterprise level. Budgeting upstart Adaptive Planning has stirred up the mid-market with their easy-to-use, hosted planning application, and have started to move up to larger enterprise clients. Centage, Prophix, Alight Planning, Host Analytics and Satori Group are all slugging it out in the mid-market and SMB category.”

180 View – The article refers to Business Performance Management, but we think it’s more often called Corporate Performance Management (CPM). CPM typically consists of strategic planning, scorecarding, budgeting and forecasting, consolidation and business intelligence functionality. It’s a logical progression for ERP vendors to extend ERP to include CPM. It’s happened with the Tier One ERP systems with SAP’s purchase of OutlookSoft and Business Objects, and with Oracle’s purchase of Hyperion. And it’s also happening with mid market ERP systems with Exact’s purchase of Longview. The trend will clearly continue.

Global ERP: You can get there from here, but should you?

October 15, 2007 from Computerworld – “One of the biggest pieces of the change management puzzle is gaining buy-in from local business leaders accustomed to suites tailor-made to support their unique business processes, says Forrester analyst Paul Hamerman. “There’s often reluctance among business units to give up the systems they use,” he says."

180 View – The same problem exists for small companies with different operating groups, each with their own system. Good luck trying to convince these operating groups that standardization is the way to go. They won’t care if the corporate CFO is able to generate financial statements in fewer days. They won’t care if the IT group can save money. They only care about their business and for what they are accountable.

Nine things you need to know about SaaS

October 15, 2007 from Computerworld – “It's an alternative to in-house operations and outsourcing that IT shops can and should use to deliver services and improve their infrastructure in a cost-effective way. SaaS can offer high-quality services at a lower cost than other alternatives, and it's particularly good for supporting mobile and geographically disbursed populations, whether they are sales staffers, telecommuters, customers or business partners worldwide. And in its latest iteration, says West, the technology is offered by leading SaaS vendors as complete platforms unifying normally stovepiped sets of services, supporting underlying data capture and analysis.”

180 View – It seems to us that only a small percentage of enterprise systems are available from SaaS vendors today. An educated guess would be about 5%. But that number seems to be rising every day. In a few years, we predict the number to be over 50%.

Enterprise software survey 2007

September 2007 from CAmagazine and written by Michael Burns – “Our annual CAmagazine software survey is back and this year it’s bigger than ever. We combined all our surveys — accounting/ERP, customer relationship management, business intelligence/corporate performance management and professional services automation — into this issue…”

What's happening with Accpac?

September 20, 2007 based on an interview with Laurie Schultz, SVP and GM and Scott Zandbergen, VP – Accpac used to dominate the mid market accounting system market in Canada. Market share has been lost to competitors but Sage is now fighting back. Expect to see marketing campaigns with the themes of “customer for life”, “suites” and “simplification”. The customer for life idea is that organizations that outgrow Simply Accounting will want to move to Accpac. Merging ERP and CRM is the thinking behind suites. We have also noted a growing trend towards end to end systems where the back office (ERP or Accounting) is tightly integrated with the front office (CRM). Simplification will occur not only in ease of use in the application but also in the selling of the system making it easier to purchase. We think competition is good for all of us, so we look forward to hearing more from Accpac.

Startup software maker Netbooks takes on Intuit

September 5, 2007 from Yahoo News – “Privately held NetBooks Inc started selling a line of computer programs designed to help run small businesses on Wednesday, taking on QuickBooks provider Intuit Inc and NetSuite Inc, which has filed to go public. Netbooks' software is accessed via Web browsers and hosted on servers maintained by the company, which is based in Rohnert Park, California. It also said it raised $6.9 million in capital from CMEA Ventures, Integral Capital and other advisors. NetBooks provides accounting software along with programs for managing sales and marketing, inventory, purchasing, shipping and manufacturing. The company was founded by Ridgely Evers, who helped lead development of Intuit's QuickBooks accounting software.”

180 View – We have not seen this system yet, but it could fill a void. QuickBooks and Simply Accounting were not developed for web access. NetSuite was developed for web access but now targets mid market companies.

All Eyes on NetSuite: IPO and iPhone’s First On-Demand Business App

July 13, 2007 from AMR Research and written by Bruce Richardson – “NetSuite issued a press release on July 2 announcing it had filed a Form S-1 registration statement as a precursor to its initial public offering (IPO) expected late summer… Coincidentally, on the same day NetSuite unveiled its SuitePhone. Effective immediately, all NetSuite software is now accessible on Apple’s new iPhone as well as all Mac products…”

Bruce’s comments on the IPO and first impression of the new SuitePhone include:

• Oracle’s Larry Ellison controls nearly 75% of NetSuite
• NetSuite has accumulated a deficit of $193 million since it started 9 years ago
• The company on a nice ramp to break through the $100M sales barrier by the end of this year.
• Last quarter, NetSuite spent 54% of revenue on sales and marketing and 18% on product development. For the same period last year, it invested 75% in sales and marketing and 24% in development.
• Following Google: NetSuite to sell shares through an auction.
• Bruce predicts that the iPhone will drive demand for mobile business applications

180 View - Bruce's “First Thing Monday”article arrives by email and we are unable to provide you with a direct link. We suggest you subscribe to "First Thing Monday", a free newsletter from AMR.

Sentai

June 15, 2007 based on a 180 Systems interview with Sentai – Things are generally improving in the ERP marketplace, but according to Sentai, they are on a roll. I asked why. The biggest change was a rewrite to their user interface. Rather than the old character based/Windows screen scraper look, they now have a thin client that looks like Windows and runs under both Windows and Linux now and possibly other operating systems later. Thin client means that only the user interface commands move from workstation to server, which dramatically improves remote performance.

Sentai has also embedded Cognos reporting, OLAP (On line Analytical Processing using PowerPlay) and portal services into their system. This overcomes the traditional problem facing many ERP systems in being data rich and information poor. They have also embedded many of the key elements of CRM in their system, which overcomes the problem of working with third party systems that are not integrated.

Sentai focuses on distribution companies. They claim that they can beat the competition on handling distributors with large volumes of data – not because of the underlying database but because of their thin client and their handling of mass price and cost changes and ability to automate vendor price uploads. Sentai will also appeal to distributors that are dragged into supporting EDI as they make it affordable with a small upfront charge for each trading partner and a small fee for each transaction. Sentai also includes their own integrated eCommerce and warehouse management systems.

Sentai is doing well in Edmonton, Florida and Cuba. We predict that Sentai will expand their geography as the word gets out about their capabilities.

40 Fastest-Growing Software Companies

June 11, 2007 from DevSource – “The biggest public software companies are increasingly relying on acquisitions for growth, as they pick off weaker competitors or startup companies that have decided not to go it alone.

Most software companies that grew more than 20% last year were helped by an acquisition, a Baseline survey shows. The acquisition trend is putting more control, and power, in the hands of a few relatively well-known companies.

For instance, Oracle has spent well in excess of $20 billion making acquisitions over the last few years, from its $11.1 billion buyout of PeopleSoft to its $6.1 billion pickup of customer relationship management giant Siebel Systems. Oracle has continued its acquisition binge this year, buying Hyperion, a maker of business intelligence software, for more than $3 billion in April...

From a profit perspective, too, the industry looks healthy. Aggregate profit at the 49 biggest software companies last year was $22.4 billion, for a profit margin of 20%. But the profitability was concentrated in the three biggest companies, Microsoft, Oracle and SAP.

Microsoft alone which has typically emphasized organic growth over acquisitions accounted for 40% of the revenue and 56% of the profits among the companies we considered…

Baseline's ranking of the 40 fastest growing software companies—those with sales of at least $150 million in 2005 — is intended to provide a health check on the enterprise software industry. What you won't find: companies that aren't purely in software such as IBM or Sun. Or for that matter, Google is not included because it derives most of its revenue from consumer services.”

180 View – Take a look at the list of the fastest growing companies. Many of them you will not recognize. The software business can be extremely lucrative not just for the huge firms like Microsoft, SAP and Oracle, but also for the smaller ones that pick a niche and run with it.

Infor Moves Into Government With Hansen Acquisition

May 16, 2007 from AMR Research – “Given Infor’s current size and desire to grow, it was only a matter of time until it looked to nonmanufacturing industries. For its first several years, Infor targeted the manufacturing and distribution industries, buying software companies with a strong presence in the industry: Geac, Lilly, and Mapics. It then turned to distribution industries with the daly.commerce, NxTrend, and Aperum acquisitions. The company supplemented all these purchases with additional supply chain functionality, such as demand planning from Mercia. Then came the acquisition of SSA, which doubled Infor’s size.

The most recent acquisitions have been for products and customer bases that are strong within the service industry segments: enterprise asset management (EAM) vendor Datastream, financials and performance management provider Extensity, and workforce management application vendor Workbrain. With Hansen, Infor gets an extensive set of public entity operations capabilities for managing building permits, business licenses, parks and recreation, water distribution, and sewerage.”

180 View - When we seek solutions from Infor for our manufacturing clients, it’s difficult to know which one is the best suited. At least when it comes to public sector operations, it won’t be confusing which of Infor’s products to consider.