BUSINESS APPLICATIONS

Sharing SharePoint and Unified Communications

2009-11-06T05:38:00.001-08:00

Microsoft SharePoint is the platform for portal-based collaboration and document management/enterprise content management (ECM). The product also works tightly with Windows Workflow Foundation (WF) and Unified Communications (UC), both Microsoft technologies that will be described in detail later on. This integration provides great visibility for workflows related to documents and document libraries, and improving collaboration through the “presence” and “click to communicate” features.

Today, SharePoint is the universal portal technology for the Dynamics portfolio; for example, in Dynamics AX 2009, the AX Enterprise Portal (formerly Axapta Enterprise Portal) is now based on SharePoint. The portal was devised from the standard SharePoint design experience, whereby a gallery of Dynamics AX Web parts is now available, making it very simple to bring to the surface Dynamics AX data (with the inherent AX security model enforced) on SharePoint portal pages.

In addition to Web parts, other strategies for SharePoint integration are its Business Data Catalog (BDC) Web Services feature (currently used within Microsoft Dynamics GP [evaluate this product] and Dynamics CRM [evaluate this product]), and data binding (within Dynamics AX). It is likely that BDC services will grow further in importance, and we should expect a broad Microsoft Dynamics consistency around this feature.

Reporting, Analytics & Collaboration Enablers

2009-11-06T05:37:00.002-08:00

To expand further on the use of the Microsoft SQL Server database that was discussed at the end of Part 1, all Microsoft Dynamics reporting capabilities will in the future come natively (which also means without new license fees) through SQL Server Reporting Services (SSRS) and associated tools. This was first developed within Microsoft Dynamics GP 9 and Microsoft Dynamics AX [evaluate this product], and will be adopted more broadly across other Dynamics products. In the Microsoft Dynamics AX 4 release, there was the capability of creating ad hoc reports, whereas most recently released Microsoft Dynamics AX 2009 also uses SSRS for all production reports.

Innovation is now surfacing as a result of integration between the Microsoft Visual Studio.NET (VS.NET) development platform and SQL Server. Namely, there is now the ability to launch Precision Report Designer and maintain the Dynamics AX semantic models in VS.NET and to pass the data in a closed-loop manner to and from Dynamic AX logic models. These models can in turn look into the Dynamics AX database (SQL Server) via database secure views. The future development will make these currently static models dynamic for report-customization purposes.

Along similar lines will be the use of Microsoft SQL Server Analysis Services (SSAS), whereby all Dynamics role centers within the user experience (UX) project (mentioned in Part 1) will feature embedded contextual business intelligence (BI). Currently, Dynamics AX 2009 has the cube generation capability, whereby analytics perspectives have been added to the business logic model, and which can generate Data Source Views (DSV’s) and Online Analytic Processing (OLAP) cubes. The future research and development (R&D) forays will likely enable the round-trip (between VS.NET and SQL Server) advanced features that will require similar features to the abovementioned reporting tools.

As a little caveat, these native reporting and analytics features will not be automatically available to the users of the proprietary Microsoft Dynamics NAV C/Side database (about half of the install base) and Dynamics AX Oracle instances. For Dynamics NAV customers using the older C/Side database, most of them upgrade to SQL Server when they move to a new NAV version anyway, while Dynamics AX users on Oracle can access the new reporting and analytics features by adding SSRS and SSAS to their deployment. Still, Microsoft will, for the foreseeable future, honor the ongoing support for these databases alongside its SQL Server.

Some Other Vendors’ UI Approaches

2009-11-06T05:37:00.001-08:00

Still, although WPF provides a visually appealing, familiar and intuitive UI, it comes with some trade-offs, specifically in memory utilization (being hardware intensive), the need to be hooked to the network, and a much greater dependency on Microsoft software. For instance, IFS doesn’t use WPF today for IFS Applications’ UI simply because of hardware needs: running WPF requires quite a hefty PC in terms of memory, and preferably the (possibly still unstable) Windows Vista platform.

We are talking here about IFS’ upcoming next-generation UI, which had for some time been called Aurora, but is now called IFS Enterprise Explorer (IEE). Namely, to prevent any confusion about Aurora being a separate product from IFS Applications, IFS has recently clarified its naming conventions.

Aurora is now a development project that will yield several enhancements to IFS Applications, all with a focus on ease-of-use and user productivity. The first deliverable as part of the Aurora project is IEE, the new graphical user interface (GUI) for IFS Applications. It is important to note that after IEE is released, the Aurora project will continue, yielding future enhancements.

In any case, IEE is interesting, to say the least, for leveraging Microsoft UI technology to create a look (albeit not yet the multi-touch touch screen, handgestures, etc. feel) of Apple iPhone (on top of Oracle database and Java-based application servers on the back end: some mix of technologies from adversaries, indeed). It is becoming quite obvious that the iPod and iPhone generation is our future workforce, who require well designed tools that they “love” to interact with. At the same time, they accept no excuses for “Why can’t I…?” questions, such as, for instance, “Why can’t I search in the enterprise application in the same way that I search on Google?”

At the end of the day, the design goal is to achieve more with fewer staff members, who thus have broader responsibilities, are able to handle the unexpected, collaborate with colleagues, and be more productive. In other words, the market drivers are the new and engaging design and user productivity. Consumer information technology (IT) and the web are leading the way, and are also becoming quite important for business applications.

To that end, prior to the IEE undertaking, IFS developed a pervasive enterprise search engine that attempts to think the way people think (e.g., “I need that fault report about the fire alarm not working”), and not the way enterprise systems think (i.e., “I want go into the preventive maintenance module where, in the service request folder, I will start the fault report screen, in which I shall then make a query on the description field containing any words followed by the words ‘fire alarm’ followed by any other words again”).

Microsoft’s Underlying Platform Parts for Enterprise Applications: Somewhat Explained – Part 3

2009-11-06T05:36:00.002-08:00

However, what has somewhat intrigued me is Microsoft’s not-so-vocal touting and promoting of Windows Presentation Foundation (WPF), although it is an intrinsic part of the .NET Framework. In fact, to the best of my knowledge, the tool has not yet been used within the Dynamics set in earnest, although Lawson Software and Verticent would be the two independent software vendors (ISV) that I am aware of deploying it.

Both vendors tout WPF’s rich UIs that support virtually infinite customizations and business process compositions using Microsoft applications. Other Microsoft-centric ISVs either support only a limited number of specific and prescriptive business scenarios, or use a combination of technology products (for example, Microsoft Office Business Applications (OBAs), Visual Studio.NET, and proprietary interfaces and UI tools) to come up with similar custom scenarios. Again, Microsoft currently uses WPF very selectively in Dynamics UIs, for example, in the Dynamics AX graphical view of the organization structure of the business.

With its Smart Office offering, Lawson is not the first to leverage Microsoft Office to deliver not only manager and employee self-service, but much more as well. In fact, I could think of the joint SAP and Microsoft Duet product, Epicor Productivity Pyramid, QAD .NET UI, SYSPRO Office Integration [SOI]), IFS Business Analytics, and so on.

However, by leveraging WPF, Lawson embeds manager and employee self-service functionality more directly into Microsoft Outlook than Duet (which is more of an add-on launched from Outlook as an integrated pane) and most other vendors’ OBA solutions. Fore more details on Lawson Smart Office, see my earlier blog post on the vendor’s CUE 2008 conference and the Gartner Dataquest Insight report by Bob Anderson entitled “Lawson Raises the Bar With Differentiating ERP User Interface.”

Curiously, Lawson has deployed another non-mainstream Microsoft technology, Microsoft Office Groove. It is a peer-to-peer (P2P) collaboration platform, providing an outstanding base for collaboration (document exchange) scenarios that involve teams with sometimes disconnected participants. Microsoft claims that future product releases will improve the alignment for collaboration between Groove and SharePoint.

Lawson’s technology decision was likely owing to Groove’s concept of “shared workspaces” and Lawson’s view that individuals live in a “space” where they do most of their work. For example, a manager really “lives in” Microsoft Outlook, and should be able to do all his/her work from there. An accountant lives in Microsoft Excel and should be able to work from there. A mobile technician lives in the cell phone/personal data assistant (PDA) metaphor, where the Apple iPhone or Palm Treo similarity of UI can come in handy.

Bottom Line: Win-Win for Microsoft

2009-11-06T05:36:00.001-08:00

Coming back to the second issue from the beginning of this blog series, i.e., Microsoft Business Division’s (MBD) Profit & Loss (P&L) statement, at the Convergence 2008 user conference, the giant stated the following stats for Microsoft Dynamics:

* A 26 percent revenue growth in Q2 2008;
* Nearly 300,000 customers worldwide;
* Nearly 10,000 business partners worldwide;
* About 1,700 Dynamics solutions in Solution Finder; and
* Over 14,000 customers and over 625,000 users of Microsoft Dynamics CRM.

Now, some nitpickers might say that Microsoft Dynamics is not a profit generator for Microsoft, if not even bleeding money due to all the ongoing product investment. Well, guess what, Microsoft is certainly not in dire need of cash to squeeze it out of Dynamics’ operations.

As some of you might know, now that Dynamics is part of MBD, which contains Microsoft Office, Dynamics, Exchange, Office Live and Unified Communications, the parent company doesn’t report the Dynamics business separately any longer in terms of revenue and operating income. However, Microsoft still discloses Dynamics customer billings figures every quarter, and here are the three data points it has publicly disclosed:

1. In fiscal 2006, the last time Dynamics was an external P&L entity, it achieved profitability in Q4, and was profitable for the full year;
2. In fiscal 2007, Dynamics crossed an important internal milestone of becoming an over US$ 1 billion business; and
3. For fiscal 2007 and 2008, Dynamics has reported a 21 percent growth in billings in each of those years.

But the thing that represents Dynamics’ “extra” contribution is the sale of all those Microsoft platform components to all of the customers of Dynamics. That is to say that Dynamics creates a “pull” for other Microsoft technologies.

Microsoft’s Underlying Platform Parts for Enterprise Applications: Somewhat Explained – Part 4

2009-11-06T05:35:00.001-08:00

For IEE IFS uses Microsoft ClickOnce, which is a technology designed to perform web-based deployment of rich applications. Basically the authorized user clicks on a link and the application loads straight from the web server without needing to be installed and distributed via CDs (like traditional client/server applications). It works similar to the counterpart Java Web Start or Adobe Flash technologies.

ClickOnce can be used for all Microsoft .NET UI application styles including Windows Presentation Foundation (WPF), Windows Forms, and Silverlight. Basically, it is the deployment technology for Windows applications. IFS decided not to use WPF as the technology for building UI initially but plans to do so for its next major update due in a couple of years, when it also expects the availability of Microsoft .NET Framework 4.0, which the vendor believes will serve its needs well. It is also currently possible to mix WPF and Windows Forms in the same application, since the interoperability apparently works very well.

In any case, the current set of tools used by IFS has helped the ergonomic design and easy navigational technologies, such as: adaptable links panel, contextual breadcrumb navigation, and rich media. Adaptable links panel is a panel at the screen that shows all places “where a user can go from here.” For example, when viewing a customer order the Link panel will show links to customer information, price agreement, service level agreement (SLA) contract, and other “related” information (see figure below).

The Advantages of the Integrated Suite for SMBs

2009-11-06T05:34:00.001-08:00

Addressing the plethora of disconnected applications is the first step a small or mid-sized company can take to gain better control of its business operations and increase the efficiency of those operations. A single integrated suite of software - often referred to as an ERP or enterprise resource planning solution - provides significant advantages to the business, accommodating the breadth of the company's business processes, while providing the flexibility for even small companies to tailor the suites to meet their specific business needs.

Why do I care if my applications are integrated?

Today's technology solutions for the middle market and smaller businesses have distinct advantages over their predecessors - both the large ERP products that were installed in very big company and the standalone applications that were traditionally installed in the SMB. New advances in technology bring mid-sized companies the benefits of a single business management suite without the cost, complexity, and rigidity of traditional software applications.

So let's look at these benefits. What does an integrated suite of business applications allow your business to achieve that a collection of stand-alone applications cannot?

1. Functionality. Access to all the core functionality required to run the business over time - at an affordable price point.
2. Scalability. Integrated suite solutions are designed to grow with your company. Stand-alone applications generally "top out" without transition paths to other solutions, leaving you to start over from scratch with a new and different application. An integrated suite provided as "Software-as-a- Service" (i.e., software hosted online) will allow seamless growth. You can add more users, more modules, increase your database size, and increase your volume of transactions as your business grows without business disruption.
3. Consistent data management. Stand-alone applications - sometimes referred to as "silos" - can't easily talk to one another. Thus, small and middle-market companies spend a great deal of time doing the same task reiteratively - entering the same data in different programs. There are some identifiable problems with this:

It is a waste of time to reenter data over again.

It is very likely to be entered incorrectly.

It may look different in different programs (Why do I have two companies in my vendor list - one is International Business Machines and one is IBM? Why do I have two versions of the same customer - Robert Smith and Bob Smith - with the same address?)

Data that results from very different disconnected applications is inconsistent, so attempts to analyze it yields the proverbial "apples and oranges" - a decision-support fruit salad.

Data isn't readily accessible - data in an integrated system can be accessed without effort spent trying to tie or consolidate the data together.

Lack of visibility into business information that crosses either departments or standalone applications.

Timely access to information. Because a SaaS system is "real-time" you get the information you want at your fingertips immediately.

1. Vendor management. Face it, managing a plethora of vendors with multiple 800 numbers for customer service is not easy. An integrated suite gives you one solution supplier to work with.
2. Reliable service and support. The ability to access affordable service and support is critical. It is easier to support an integrated ERP environment than a hodgepodge of different applications.
3. Clarity. With an integrated business management suite, there is a "single version of the truth" that only needs to be entered once to be propagated to all parts of the business that need it. All business processes, all employees who touch the application, and all the executives who make decisions for the company see the same version of reality, in real time, all the time.
4. Business process customization and automation. Only with an integrated business management suite can SMBs actually tailor the entire business processes that underpin how they conduct their business. Because workflow underlies the entire suite and not just fragmented parts of it, SMBs for the first time have tools to customize the solutions to work exactly how their businesses work - rather than having an application that dictates how the business has to be run.
5. Long term cost of ownership when provided as SaaS. When an integrated suite is offered as Software-as-a-Service - allowing businesses to subscribe to a service rather than purchase, install, and maintain an in-house software solution - companies can better forecast and manage their costs, and eliminate high internal IT support costs. Web-based delivery of business solutions proves the most economical in the long run as your business needs grow and change2. Research shows that SaaS deployments are 50% to 90% faster with a total cost of ownership (TCO) five to ten times less expensive than traditional software.3 Cost of ownership can be complex - as it includes far more than just the savings gleaned in original purchase and implementation. It also includes:

The time, expense and skill required to integrate the multiple applications which has to occur each time an application in the mix is upgraded or replaced

The cost of potential disruption or downtime when the multiple products are upgraded or new revisions or releases are installed

Time and dollars spent upgrading software and ensuring integrated systems work properly together after each upgrade

The very positive effects of increased productivity: faster order processing, rapid access to critical data by employees, increased ability to address customer issues immediately; instant data for upsell/reselling, returns management, as only a few of the many examples.

The even more positive effects of timely, accurate billing with compliance to all revenue recognition requirements

Overcoming the Barriers of Stand-alone Business Applications

2009-11-06T05:31:00.000-08:00

Small and middle-market companies are the lifeblood of the economy - in all regions of the world. But many of these companies today feel the need for a transfusion - the operational boost that can move them to a customer-focused business with the ability to grow even larger. These small and mid-sized businesses (called SMBs) have many of the same business requirements as large corporations; they may be smaller or employ fewer people, but they can have equally complex business processes.

Big businesses moved from home-grown legacy systems to a plethora of stand-alone applications (sometimes referred to in the past as "best of breed"), but by the end of the 1990's these big guys had consolidated on running the majority of their core business on one integrated platform, such as SAP's R/3, PeopleSoft, or Oracle applications. These integrated business applications proved invaluable in improved productivity and better business management, but at the time, they were also expensive, complex, difficult to implement, manage and support, with protracted deployments (sometimes years) that delayed a recognizable return on investment. For these reasons, small and mid-sized businesses avoided these large ERP suites like the proverbial plague; at the time, they were just too risky for a small business to undertake. Despite repeated efforts from the big ERP vendors to capture the mid-market businesses, the SMBs simply weren't biting.

Unlike the Fortune 1000, today's SMBs are more likely to have a hodge-podge of software products in use in their business. These applications typically share common characteristics: the financial packages, usually the first procured, run on a standalone PC, and are the first to cause problems, as they cannot accommodate growth in transactions, cannot scale to accommodate more users, and have severe database limitations. The second software package a small business buys is usually tied to the nature of the business itself - an application suitable to the vertical industry in which the business plays. And these two applications don't "talk" to each other. Additional applications - inventory or warehouse management, customer relationship management (CRM), T&E management, HR, etc., may be added - leaving the small business with a disconnected slew of applications - and what's worse - the problems of manually entering and re-entering data across these multiple products. The ramifications include lost productivity in work hours spent re-entering data manually and attempting to consolidate data from the disparate systems; extremely high error rates, as manually entered data is highly prone to mistakes; lack of visibility to the information necessary to make decisions; and outgrown applications that cannot scale to allow the business to grow. The SMB is trapped by the limits of the very technology that was intended to help the company grow and thrive.

And unlike large companies, small and mid-sized businesses face the realities of smaller budgets, fewer IT resources, and zero tolerance for risk. They cannot withstand the long implementation timeframes or the cost of the ERP solutions that are the mainstay of large corporations.

Microsoft—Making the Point of Sharing

2009-10-21T08:03:00.000-07:00

However, hardly anyone's heart should be crying for Microsoft. As the old adage says, "still water runs deep" , and Microsoft has at least used the Duet and Snap experience to bide time to come up with an even more encompassing solution. Before that, the giant had to conduct some serious soul-searching, such as whether to conclude "Project Green", which sought synergy across its ERP product lines.. Considering this hindsight, it is no longer that important to know whether Microsoft merely toyed with the product convergence idea or if it was the wishful thinking of the news-hungry press and eager analysts (some of which are now gloating about the idea's abandonment). Most likely, the temptation was there (who, after all, wouldn't be tempted to deal with only one product line, as opposed to four?), but a deeper analysis of acquired products has likely caused Microsoft to conclude that each product line has some distinctive technical and functional aspects. This, in conjunction with the partner ecosystem, would make doing anything injudiciously and precipitously (such as imposing unfamiliar tools and technologies) result in the alienation of the existing customers and partners.
But, Microsoft certainly did not panic, and has meanwhile rather spent time on figuring out how it can parlay its desktop supremacy (with an estimated 400 million Office users worldwide) into attracting enterprise applications users, and possibly changing some enterprise applications paradigms. Microsoft operating systems and desktop products have traditionally defined the user experience for most types of applications (with some challenges coming from the simplicity and intuitiveness of Web browser and portals). But, from the vendor's perspective, there is much more to Office integration than the several simple scenarios enabled by Duet and Snap. As Office evolves into a system that supports deeper and contextual business intelligence (BI), workflow, search, document management, and enhanced collaboration through products like Microsoft SharePoint, Microsoft has come up with a composite architecture that quite exceeds the one of Duet. It builds on the long-espoused idea of providing users with more integrated and contextual working environment (see What Do Users Want and Need? ). Perhaps the best example is the successful Microsoft Dynamics CRM 4.0 product that features native Outlook UI and its accompanying, instantly familiar experience. Indeed, anyone who wants to see what comprehensive integration between a business management application and Office looks like, should check out the user experience of Microsoft Dynamics CRM, where the entire application "lives inside" of Microsoft Outlook. For more information, see War Looms in the On-demand CRM Market (and Beyond)—But Will You Profit from It?.

This would be the best embodiment of Microsoft's vision of connecting people across a company with the business processes and information they need to be successful within the context of the productivity tools they use every day. The idea is now is to determine how to extend similar capabilities and the same (or at least a similar) "look-and-feel" across all the ERP product lines. There is at least some virtual convergence of diverse product lines (if not necessarily the convergence at the server side). To that end, Microsoft touts "simplification" and "minimalism" as the guiding principles of evolving its applications and making them modern, in terms of user experience, runtime infrastructure, and design time tools. On the user experience side, the vendor has tailored the user experience to roles (thereby trying to reduce the user experience footprint per-role, as will be described later on). On the runtime infrastructure side, it has added several Microsoft technologies, ranging from reporting via analysis to portal capabilities. By doing so, the Microsoft Dynamics team has been able to get rid of a bunch of arcane code in its existing runtime environments that had duplicative middleware, since all Dynamics ERP products' portal presentation layers are now native in SharePoint, with reporting being in native Microsoft SQL Server Reporting Services (SSRS). The idea behind this was not just a simple case of substitution, but actually a reduction in code or abstractions that Microsoft had to maintain, and also the democratization of access to the data and business logic.

When it comes to design time, Microsoft Dynamics developers have been religious about keeping the development metadata driven. This was to mitigate the traditional difficulties within competitive development environments when it comes to enabling the extensibility of their products (e.g., adding entities, adding a couple of fields, relating these relationships, adding some form, writing some logic, exposing the underlying business logic as a Web service, creating a Really Simple Syndication [RSS] feed out of it, etc). Conversely, Microsoft touts its metadata driven modeling tools as a key to how to achieve and maintain simplicity (which is the key driver for the partners' productivity too) for the most complex of customization tasks, while still adding new runtime capability like workflows, process, role-tailored user experience, etc.
Such new easily deployed and reasonably priced packages are aimed at helping customers improve the situation they face today. On average 85 percent of employees do not have direct access to critical information, such as data on customers, costs, orders, and schedules, contained in their ERP application. Microsoft argues that many users want to work exclusively in one Office environment or the other, rather than in pesky proprietary ERP screens. To that end, in March 2007, during the Microsoft Convergence 2007 user conference, Microsoft announced the upcoming availability of a new offering that should help customers further extend the power, insights, and process control of their Microsoft Dynamics ERP applications to most of their employees via familiar business productivity tools in the Microsoft Office system. The new Office-based client is intended to make the ERP capabilities available to a vast majority of employees, in comparison to customarily only extending this to those employees who have purchased ERP seats.

This new package, was somewhat awkwardly named (compared to Duet) as Microsoft Dynamics Client for Microsoft Office and SharePoint Server (MOSS), and contains a collection of up to 12 self-service applications that are built into the Microsoft Office release and SharePoint products and technologies. It also has a license for the recently released Office SharePoint Server 2007. These applications, such as Time and Attendance for Microsoft Dynamics GP, Project Time and Expense for Microsoft Dynamics SL, Microsoft Dynamics Snap Business Data Lookup for Microsoft Dynamics AX, and FRx WebPort and DrillDown Viewer, are expected to simplify access to business information and help connect employees more closely with their company's business processes. Also included in this new offering are licensing rights for customers or industry partners to build their own Office Business Applications (OBA), a new category of programs where Microsoft Office becomes the front-end for accessing the back-end ERP functionality of Microsoft Dynamics. For more information, see Microsoft's Underlying Platform Parts for Enterprise Applications: Somewhat Explained.

This new package has been priced to facilitate companywide deployment, as the price for Microsoft Dynamics Client for Microsoft Office and Windows SharePoint Services is $195 (USD) per user and Microsoft Dynamics Client for Microsoft Office and SharePoint Server is $395 (USD) per user. Microsoft Dynamics Client for Microsoft Office is available to Microsoft Dynamics Business Ready Licensing Advanced Management customers for Microsoft Dynamics GP 10.0, Microsoft Dynamics AX 2009, Microsoft Dynamics NAV 2009 and Microsoft Dynamics SL 7.

Links to SAP Applications

2009-10-21T08:01:00.002-07:00

The Web services calls from the Office Add-On are relayed into the SAP environment, which also occurs within the Duet Extensions through the service bundling component. The engine on the client loads assemblies and metadata from the cache and interprets the metadata descriptions of applications to execute service calls, execute business logic, and construct and display the UI screen based on metadata, and interact with host software. The runtime engine uses an Outlook services library (using the standard programming features of Outlook) to integrate the following features and services:

* Action pane. The Duet action pane will mimic the behavior of the Office programmable task pane.
* Toolbar buttons. Custom buttons can be added to the application-level toolbar, and these buttons will trigger the execution of metadata-based actions.
* Context menu items. Custom context menu items can be added to folder and item context menus to trigger the execution of metadata-based actions.
* Outlook events. Selected standard Outlook events and behaviors are extended to automatically activate metadata-defined actions.
* Custom calendar views. Outlook tabbed forms and action panes are defined via metadata.
* Contact management. Additional tabs are added to contact objects for server-maintained data.

As for the security issues, the challenge Duet faces with authentication is that authentication needs to be separated from the authentication within the system. For authentication within the system, Duet reuses the authentication of the local user in the Microsoft Windows environment. This is generally implemented using Windows NT LAN (Local Area Network) Manager or Microsoft Active Directory, which most users are familiar with. Within Duet, SAP security experts have developed a module that is able to take the user token from the Windows environment and map it to the proper SAP user. In doing so, Duet is able to issue a single sign-on ticket enabling the client to communicate in a with the web services on the SAP side in a secure manner.

Once authentication is secured, standard SAP guidelines and principles take effect and the access is granted based on authorization profiles associated with the user in the underlying SAP system. For example, each profile is associated with a only a few of the cost centers that exist in the underlying system. A user can have access only to his or her own personal information based on service scenarios, while a manager is granted access only to his or her organizational unit within the entire system, and so on.
The Recent Duet Uptake

In any case, Duet's highly involved collaborative architecture that has shown the major "pains and gains" of SOA. (For more information, see SOA from a Management Perspective ). And it has resulted in a commercial product that is unequivocally priced (approximately, $125 [USD] per user, though this price does not include Microsoft Office and SAP licenses, but only for Duet functionality), that is sold and supported under no uncertain terms. With the most recent Duet 1.5 release, some drawbacks of Duet 1.0 have also been addressed, such as the number of supported languages, which has been extended to 16: Simplified Chinese, Czech, Danish, Dutch, Finnish, Italian, Korean, Polish, Russian, Swedish, Hungarian, Norwegian, and Traditional Chinese. These are in addition to English, German, French, Japanese, Spanish, and Portuguese in Duet 1.0. A few more scenarios were added too (e.g., recruitment management, travel management, purchasing management, workflow approvals and reports and analytics), some of which run within a Excel UI screen too (as opposed to only within Outlook in the Duet 1.0 scenarios). One should imagine the inclusion of data from other back-end systems beside those of SAP, down the track.

In fact, the success of over 400,000 sold Duet licenses within 18 months has "shocked and awed" many competitors. The responses were numerous, as competitors began to trot out their own, comparable products. IBM cited its Project Harmony that features the integration of Lotus Notes and IBM Workplace (formerly Lotus Workplace) to SAP (and to many more SAP product releases than Duet), Google touted its no-brainer on-demand Google Enterprise applications, many other vendors said that they also have the Office-based (or Office-like) interface. Others flouted their Asynchronous JavaScript and XML (AJAX) programming. Adobe/Macromedia Flex or simply an Internet browser also flagged their products with their familiar and intuitive interfaces (ironically, MSN Hotmail was one of the best deployments of AJAX).

In a particularly peculiar position was Microsoft, which certainly could not complain about royalties from 400,000 deployments (or at least acknowledgements) of Office, Exchange or Windows Server. However, the Microsoft Dynamics business applications group and the accompanying partner ecosystem probably didn't share the same enthusiasm, by any respect. To appease these constituencies, Microsoft released Microsoft Dynamics Snap applications n mid-2006. Microsoft Dynamics Snap, which, beside UI familiarity and simplicity for users, also provided in-context business data lookup in Microsoft Office programs. At the time, Microsoft pointed out that Dynamics Snap was a "shared source" initiative, because the vendor wanted to encourage its partners to build and customize these solutions for their customers, either for specific roles and verticals or to contribute in helping Microsoft build more solutions that enhance productivity and empower information workers. Microsoft emphasized its approach of doing this in a community environment, by distributing the Snap programs under a shared source license to enable people from other companies to modify and extend the programs at no charge. Since then, there have been reported over 18,000 downloads of Snap along with nearly 1,500 individual developers and companies that have joined the Dynamics shared source community. Although this continues to be a great way for Microsoft to understand the dynamics of a Web 2.0-style community (social networks) environment as it applies to business management software, there has been confusion about licensing to customers and what other products customer need to make use of the MS Dynamics Snap.
Even the developers from SAP Labs often express their love for the idea of mash-ups, which, according to Webopedia, is a term derived from the hip-hop music practice of mixing songs together. Mash-ups refer to a new breed of Web-based applications created (unfortunately) by hackers and programmers (typically on a volunteer basis) to mix at least two different services from disparate, and even competing, Web sites. A mash-up, for example, could overlay traffic data from one source on the Internet over maps from Yahoo, Microsoft, Google, or any content provider. Creating a mash-up from multiple sources into one dynamic entity is considered by many to represent the promise of the Web service standard and of on-demand computing (see SaaS-ing the Manufacturing Opportunity ). However, this business model has yet to create viable intellectual property and revenue streams for participants (given the dynamic nature of new product releases and versions), and especially in terms of a structured support and maintenance, which seems to be well spelled out in case of Duet.

The Role of Microsoft Office Add-On

2009-10-21T08:01:00.001-07:00

The metadata repository stores metadata, authorizes access, and enforces the consistency of stored data, whereby the metadata storage component is a relational database built on top of Microsoft SQL Express 2005. This metadata describes objects that are exposed within Microsoft Office and their related UIs and associated actions, and is being pulled by the client, based on the user and his or her role(s) within the organization. The Microsoft Exchange handle, on the other had provides an application-friendly and user-friendly view of messages in Microsoft Exchange. It addresses the conversion of standardized messages from the backend server into Outlook objects, such as IPM.Note. The handler provides an independent layer to different versions and formats of messages, so that calling components do not have to address the versions and formats of Office objects or command messages for the client add-on. The Exchange handler provides interfaces to the most important objects within Microsoft Office, including e-mail (IPM.Note), e-mail attachments, the calendar, tasks, and contacts.

Last but not least, the service bundling component hides the implementation details and distributes incoming calls to Duet-specific Web services or SAP ESA services, or any combination thereof. The criteria that determine which component will be used during implementation is based on the method that can best support the respective use cases within the application. The service bundling component also implements a method to resolve any Duet-specific IDs toward SAP item IDs where necessary. It is anticipated that the vast majority of these services will be executed synchronously for functionality, such as data validation and displaying information in action panes. In case of asynchronous[2] calls, the service bundling component will always reply with an acknowledgment confirmation and then route the reply through the Exchange handler back to the client. An example of such an asynchronous call can be found in team management when requesting all organization contacts for a given user.

In addition to these components, Duet Extensions also include a number of so-called "pluggable services" that interact with existing technology to enable user roles, authentication, security, and reporting, and provide a set of tools for configuration and customization. The pluggable services enable integration with preexisting technologies and provide functionality, such as user roles, authentication, security, and reporting. Since these capabilities are not Duet-specific, customers should be able to deploy any of these services from different vendors that support these standardized interfaces. It should also be possible to reuse existing solutions already installed on site.

Apparently, Duet Extensions can handle all communication between the client and the underlying SAP ERP system, because Duet Extension can gather the context and define the objects that are exposed to the user. Thus, those extensions invoke the relevant underlying SAP ESA services to talk to the underlying applications within the SAP ERP environment. As described previously in some cases, the responses may be handled asynchronously. To accomplish this, Duet Extensions transmit the data back to the local client through the Exchange handler, which completes a simple round trip of data from the UI within an action pane to the SAP ERP system and back.
The metadata that is available on the client resides within Duet Extensions, whose server also acts as a consolidation engine. Most businesses have an IT landscape using a number of different SAP systems, such as an SAP BW, SAP ERP, SAP CRM, SAP SCM (Supply Chain Management), or any number of non-SAP solutions. The Duet Extensions server unites one or more of these backend systems, by taking the metadata from various underlying systems and combining them based on the user and the user's role within the organization, and pushing it down to the client. As the users might not always be online, Duet must be careful in the way it communicates information back to the client, and additional queuing and caching may be required in the Extensions. The data is communicated from SAP ERP into the Exchange handler, which properly formats the information into an extensible markup language (XML) document (or a format that the client can then understand).

If a report is needed, information needs to be converted into a hypertext markup language (HTML)-based email, maybe with some kind of attachment. It also requires flagging the report with specific metadata that is not visible to the end user, but is rather attached to the e-mail body. This enables certain kinds of processes once it reaches the client environment. The client then interprets the metadata and dynamically combines it into the UI screen before presenting the notification of the report to the user (e.g., the final budget status notification). The rules gathered from the back-end system are converted into metadata that the client can understand, and the gap between the two systems is bridged. Because Duet is role sensitive, information presented and executions available to the end user depend on the user's role within the organization (whether the user is an employee or a manager, for example).

The Role of Microsoft Office Add-On

Further, the Microsoft Office Add-On enables communication between the local Microsoft Office client with the Duet Extensions and the SAP system through a metadata portal and storage interface. In other words, the Office Add-On, also known as the Duet Client, represents the Office screen add-ons based on metadata, since it uses the master data for drop-down menus or business rules and then triggers activities in the principal SAP system through either synchronous or asynchronous Web services calls. Metadata descriptions of the various applications are interpreted through the engine, which supports integration with various kinds of host software. The engine also provides Outlook integration, personalization, Excel integration, InfoPath (recently renamed into Windows Workflow Foundation [WF]) integration, and metadata-defined forms. Duet also supports SAP Business Workflows through Microsoft Outlook.

In order to illustrate how data is routed through the Duet architecture, one needs to understand that a typical Microsoft Office user often creates status reports of one kind or another. Using Duet, this process is accelerated since the Office interface already shows which reports an information worker can subscribe to, and offers templates for creating new ones (e.g., a budget report needs to be delivered every Monday morning at 9 a.m., or the project manager wants an alert only after the project has reached 80 percent of total budget consumption). All of these kinds of activities can be done using the local client, in which case it is Microsoft Office combined with Duet.

The Client or Office Add-On is responsible for representing the UI, based on metadata and other kinds of desktop information. For this purpose, the Client/Add-On is separated into three major parts: 1) runtime engine; 2) cashing mechanism; and 3) output queue.
The runtime engine interprets metadata in order to understand which business object is being exposed (a budget report, leave request or time entry, for example). Through these exposed objects, the Office Add-On is able to create subclasses of the existing objects within Microsoft Office. For instance, a "time entry" would then be treated as a subclass of an "appointment" object, and these classes would be exposed through the UI within the action pane environment. In addition to describing objects, the metadata also describes the UI screen and actions that can be triggered from within the user screen. This additional metadata, available on the client side, includes both generalized personalization data and some master data. The generalized personalization data, for example, determines which fields become available in the action pane, whereas the master data, for example, determines which project's budget is being assessed or the default status report profile. The engine's metadata form definition component is the primary method used to customize Duet forms and dialogs, whereby administrator users, using a metadata definition, can customize the action pane, custom dialogs, or Outlook custom forms. This level of customization also enables easy text replacement and user screen fields localization.

The caching mechanism is responsible for maintaining the proper metadata on the client machine, and is based on the user's role and supplies the functionality to store a user's metadata based on user role and data instances. It also stores metadata in a secure manner, and provides access to metadata when disconnected from the Duet server. Furthermore, the cache includes deployment capabilities that deliver application assemblies proactively to a user's machine. Last but not least, the cache provides offline data retrieval for the Duet by switching between the offline store or to the online Duet server when accessing data by using hints from either metadata parameters or other configuration information. The cache component also provides the first-time provisioning and deployment of reference data, reference data expiration refresh rules, and local data storage. In summary, the caching component ensures that metadata, master data, and additional files and objects are kept available locally and are up-to-date. The component is able to store this data on the local client without the need to continuously synchronize and resynchronize with the backend SAP ESA services. And by inserting a validity period into that, Duet can always keep the data cache up-to-date with regards to changes from the back-office system. It is not so much a push for updated information, but rather a pull from it, which should also speed up the end-to-end communication by preloading some of the data that the underlying system will request.

The third component of the Client, the output queue, provides the functionality to enable users to initiate actions while being offline, which are then invoked whenever a connection becomes available. The output queue component is invoked when a user triggers an activity, such as saving a time entry. It then takes the selected business object and triggers activities in the underlying SAP ERP system through either synchronous, or asynchronous Web services calls, which then come into the SAP environment within the Duet Extensions, through the abovementioned service bundling component. This component allows the Duet to compose multiple underlying Web services into a single one for, say, performance improvement, or for using the result of a first call for a second call.
Queued actions are serviced as soon as possible. If online, these calls are serviced in short time intervals; if off-line, the calls are stored for invocation later. Logically, the output queue is used only for asynchronous calls, and to support this functionality, the output queue provides interfaces to be able to "flush the queue" when the backend server is available. Calls made by the output queue to the service bundling component in the backend system will generally respond synchronously with acknowledge confirmation. Duet supports the deployment of applications to the client machine as complete units containing the metadata, assemblies, additional required client components, and reference data required to execute the application. This will occur automatically through a deployment mechanism and includes upgrade control in the form of versioning.

Application Giants in Duel—and Duet—for Users' Hearts, Minds … and Wallets

2009-10-21T07:57:00.000-07:00

The relationship between the two software powerhouses, Microsoft and SAP, has been intriguing to put it mildly, at least since Microsoft's entry into the enterprise applications arena in late 2000 (see Microsoft 'The Great' Poised to Conquer Mid-market, Once and Again ). While the relationship has been depicted by many through a myriad of antonyms, such as "on-off", "hot-cold", or "love-hate", currently, it can best be described as "mutually civil". One can even find some uncanny similarities between the two, such as the occasional involvement in intellectual property lawsuits (whether as plaintiffs or defendants) or through the relatively recent, almost coinciding departures of technological visionaries, Satya Nadella and Shai Agassi, respectively (although Nadella was merely transferred within Microsoft, to the search and ad group that will hope to fend off Google's undeniable threat).

Microsoft and SAP then entered a "strange bedfellows" or co-opetion phase in their relationship, by dallying in business applications. Acting like two high-profile on-again, off-again celebrities, the two were dismissive about questions from the press and analysts about the inevitable competition this partnership would create (i.e., responding "We do target different sizes of companies"). Nonetheless, this stance become moot owing to SAP's forays into small business via SAP Business One and Microsoft's propping up of Microsoft Dynamics AX, as an upper mid-market solution. Then came a perceived snub by SAP for opting for Java 2 Enterprise Edition (J2EE) as a primary development environment for its infrastructure and development platform (while there is, nonetheless, some lesser valuable interface options for the counterpart Microsoft .NET Framework environment). However, SAP's move was quite logical given the still lingering perception of Java's better fit for larger enterprises (see Understand J2EE and .NET Environments Before You Choose ).

Any hard feelings between SAP and Microsoft were short lived, as we found out in 2004 when the two were engaged in secret (and startling) merger talks, which was quickly put ad acta before the news broke (whether for good remains to be seen). For most of that year, both vendors had to spend time explaining their separate forays into developing next-generation, service oriented architecture (SOA)-enabled products. Then 2005 seemed to be the year of bliss, where the two expressed mutual respect, and even worked jointly on a commercially available product featuring best of both worlds. Specifically, SAP and Microsoft joined together to leverage the openness of the SAP NetWeaver and Enterprise Service Architecture (ESA) blueprint (see Multipurpose SAP NetWeaver ) with the .NET-based architecture of Microsoft Office desktop applications suite (see Subtle [or Not-so-subtle] Nuances of Microsoft .NET Enablement ). The result was the joint product code-named Project Mendocino (the name of a town halfway between the companies' respective US headquarters) that promised to deliver familiar Microsoft Office desktop management and productivity tools as the façade for the heavy-duty lifting processes of SAP's enterprise applications. In other words, Project Mendocino extended and automated selected business processes from SAP ERP (Enterprise Resource Planning) through the familiar Microsoft Office user interface (UI), by providing role-relevant displays of information while retaining SAP applications' process context and the necessary collaboration and analytic tools.
Portal and other SAP entry points, such as SAP Web Dynpro or the recently unveiled NetWeaver Business Client, (formerly known as Project Muse), which is still needed for power users to gain full access to more advanced SAP business applications and processes. However, for casual information workers that require quick access to simple repetitive processes, such as billable time entry, leave request, or budget monitoring, Project Mendocino came in handy, because it eliminated the reliance on power users and business application experts. At the same time, it also connected business process applications with commonly used productivity applications more seamlessly. The product's capabilities included personalization, object synchronization, report distribution, alerts or notifications, a form-based approval process, and offline functionality. Through these capabilities employees and managers had the potential to realize greater efficiency and flexibility within a number of self-service processes. Other potential benefits revolved around higher productivity, better decision-making, audit traceability and transparency, and faster user adoption.

More information on the initial product's processes, capabilities, and benefit can be found in Major Vendors Adapting to User Requirements and in the book Enterprise SOA: Designing IT for Business Innovation, by Dan Woods and Thomas Mattern (2006 O'Reilly Media). For now, it suffices to say that Project Mendocino initially enabled information workers to perform tasks, such as time management, budget monitoring, organization management, and leave management via their desktops, using features like extended application menus, an SAP-specific smart panel, and business analytics delivered via Microsoft Excel, smart business documents in Microsoft Word, and synchronization Microsoft Outlook between Microsoft Exchange Server and SAP ERP processes.

Both Microsoft and SAP pledged to sell and support the product, which was first released to fifty pilot customers in late 2005 before it was made generally available (GA) in mid-2006 with its official name: Duet. At the time critics were quick to note that the product covered only a handful of simple business processes and that it was more "eye candy" than an "order winner". However, they did see that the product would also be a decisive factor for prospective customers to implement the entire SAP ERP suite (or, for existing SAP users to migrate to its latest release). Critics also expressed caveats of necessary technological prerequisites and hidden costs for Duet. Namely, the client machine runs on Microsoft Windows XP with Microsoft Office 2003 installed, while the Duet hub (which will be detailed later in this report) requires Microsoft Windows Server 2003 or higher and Microsoft Exchange Server 2003 or higher, including Microsoft Active Directory 2000 (however, there are no additional installation, software, or hardware requirements for existing Microsoft Exchange Server landscapes). Moreover, on the SAP side, users have to be on SAP ERP 2004 (including NetWeaver) or higher, while some most recent Duet implementations require additional SAP modules, such as Employee Self-Service, SAP CRM (Customer Relationship Management) 4.0, SAP SRM (Supplier Relationship Management) 5.0, or SAP BW (Business Warehouse) 3.5. The early product release also ran only in English and within Outlook (as opposed to Word or Excel).
More Than Meets the Eye

In addition to disseminating useful SAP data among knowledge workers (outside of its traditionally limited power-user dispatch list), Duet has been crucial for being a "proof of concept" model illustrating the potential development and adoption of composite applications, especially when the result of a joint collaboration between two software giants and market influencers.

Indeed, Duet is one of the first examples of a tangible SOA-based composite application product. While several tools use SOA conceptually, in ways that are sometimes hard to grasp, this tool is based on consuming services in concrete ways that benefits almost every information worker. Duet showed how SOA can be applied to the user experience through familiar desktop applications, and for some users, it will deliver functionality that supersedes the need to work directly with any line-of-business (functional department) or back-office enterprise applications. By exposing functionality and giving even the most casual users an easier way to update data that normally resides only in the back-office system, Duet embraced the innovative potential of SOA services. It exposes features from underlying ERP systems in new ways that create more value. And these services can be used together, even though they were probably written for a system that was designed before SOA was someone's figment of imagination.

This fulfills one of SAP's short-term goals for ESA (SAP's variant of the SOA blueprint) adoption—to create simple services (software components, if you will) that work on top of legacy applications already used by organizations. In the future, the entire stack which encompasses ERP, CRM, and all other SAP Business Suite solutions will eventually evolve to use business objects as their underlying application. Instead of having a rigid and unwieldy monolithic set of applications, SAP is creating a collection of business objects that can be applied in more flexible ways. By late 2007, there will be more services to choose from than the ones used to support Duet, since ESA follows the SOA format of "model once, run anywhere". Namely, instead of hard-coding multiple solutions that apply to different domains, ESA employs business objects or services that are modeled in a way that allows them to handle different solutions. Duet is just one of many client-side solutions that ESA will enable.

To understand how Duet is in tune with SOA, it is important to become familiar with the new stack defined by SAP ESA, and to understand what a composite application is. Webopedia defines a composite application as an application that consists of more than one type of service delivered from an SOA environment. It can range from functionality to entire applications. Services are generated through "local" application logic that controls how services interact with each other. For more information, see Understanding SOA, Web Services, BPM, and BPEL.

As a composite application, Duet overlaps with nearly every part of the new SOA stack:

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User screens. Duet uses the familiar Microsoft Office desktop interface, which is achieved not by hard-coding the UI, but through backend modeling and deploying it to the client.
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Process orchestration. Duet uses a communications hub referred to as the Duet Extensions to route data to and within the ERP system.
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Process integration. Using the aforementioned extensions, Duet translates data from Microsoft Office applications such as Excel into a format that is easily understood by existing ERP tools and their respective enterprise services.
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Process workflow. All of the usual workflow processes within SAP ERP take place within the context of Microsoft Office's desktop tools.
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Distributed data. The ability to cache data for working online or offline also plays an important part in the functionality.

Other applications being created by SAP will use different parts of the stack to enable different solutions. However, other services created for Duet should indirectly benefit all SAP ESA users by increasing the total pool of objects in the SAP Enterprise Services Repository. Also, every service and application being created for Duet is designed so they can be used by other applications within the ESA environment. For instance, timesheet entry services are part of the Cross Application Time Sheet (CATS) feature that will be used by many applications that rely on timesheet recording and account assignment.

The Duet Architecture Outlined

Despite seemingly simple processes that Duet enables, the product exemplifies how serious an undertaking a commercially available composite application can be. When the goals of Project Mendocino (now Duet) were first formulated, it reportedly[1] became clear that two very different architectures needed to be brought together. On the one side was the ubiquitous client application, which required local data storage, while on the other side was the proverbially complex SAP ERP environment. The different technologies in this case reportedly made it quite easy to select Web services as the interface technology, since both camps added standards-based Web services support in their last releases. However, in this case, simply connecting these two worlds using Web services did not offer a comprehensive enough solution. Namely, the goals required more extensibility, because SAP wanted to enable a model-driven environment on the client side, which would allow Duet to push additional screens and updates to the user without the need to continuously run through an installation and reinstallation whenever business needs changed.

On top of that, Microsoft Office currently works in online as well as offline modes. This capability had to be maintained in Duet as well, since users had to be able to trigger activities while being offline which would later have to be automatically resynchronized once their machines went back online. At the time, Microsoft and SAP also realized that the involved disparate system components (i.e., Microsoft Exchange Servers, Microsoft Office, and SAP ERP systems) are of such a high value to customers that massively updating those environments (and exposing the existing system landscape to any unnecessary disruption) would be unacceptable. SAP and Microsoft weighed these requirements carefully and realized that there was a the need for a communications hub that would sit in the middle of the two existing environments and "mediate" communication and processes. The hub collects various configurations from the back-end system, determines the objects that should be exposed, and decides which activities the user can trigger and how all of that ties together within the user screen. The communications hub is also referred to as the Duet Extensions, which are connected with the Microsoft Office client and the SAP ERP system. The result is that there are three primary parts to Duet's architecture: 1) the Duet Extensions; 2) the Microsoft Office Add-On; and 3) SAP ERP foundation.

The Role of Duet Extensions (the Hub)

The Duet Extensions are implemented in the Microsoft .NET Framework and use the J2EE technology. They act as a hub between the client side and the SAP ERP systems on the server side and enable these two to talk with each other. They also include the application description in the form of metadata (or "data about data") and cater the metadata to the client side. The major components of the Duet Extensions include 1) metadata repository interface and storage; 2) Microsoft Exchange handler; and 3) service bundling.

Jul 21 Managing the Aches and Pains of Long Cycle Times: Automating Controls for Pharmaceutical Manufacturers

2009-09-10T00:01:00.001-07:00

One of the biggest challenges (or business pain points) for pharmaceutical manufacturers (or life sciences companies) is the long cycles that are required for research and development (R&D) and product approval. This is particularly a challenge for manufacturers of generic drugs, for which cycle times can average 20 months or more (and the full time-to-market period upwards of 12 years).

Why are long cycles a problem?

Simply put, it comes down to the familiar equation that “time = money.” More time needed means more capital spent, and manufacturers watch their bottom lines slip farther and farther away. To begin to formulate a plan to address the issue of long cycle times, it’s important to understand the factors that contribute to this challenge.

Long R&D cycles happen for a number of reasons. One is that there has been increasing need to comply with regulations, including the Food and Drug Administration’s (FDA’s) Title 21 Code of Federal Regulations (CFR) Part 11, for pharmaceutical manufacturers that are employing methods for electronic record-keeping and electronic and digital signatures.

This increasing need often means that additional administrative time must be spent on ensuring that the technical and procedural protocols are set up correctly and doing what they are supposed to do.

Another reason for long cycle times has to do with the need to ensure that all stages of product development are adequately documented for audits. Whether a manufacturer is using paper or electronic methods of data storage, there must be a reliable, consistent, secure, and accessible method of storing all documents related to the research, development, manufacture, and release of all drugs.

Every change to a document must be retained, and the integrity of the versions kept intact. For manufacturers straddling the line between paper-based and electronic methods, all paper-based documents need to be transferred and saved in digital form, a process that can require considerable time for scanning or manually entering data.

What are the business risks involved in longer R&D cycles and product approval?

Fewer products can be developed or manufactured concurrently, which means fewer products get to market. And fewer products to market can mean a decrease in the company’s in-coming cash flow (i.e. decreased profits). Additional worry may come from the fact that with this increase in time-to-market, other competing manufacturers may develop a similar drug and release it sooner, thereby further diminishing profits due to lost market share and a shortened product life cycle. A delayed or lengthened cycle time can seriously affect the return on investment (ROI) for a given new drug or product.

What can help?
A software solution that implements automated controls that address compliance issues, including 21 CFR Part 11.

How does 21 CFR Part 11 relate to product R&D and approvals?

For all of the processes involved in getting a drug to market, strict policies must be established and followed by a company regarding the use of electronic records. Each step of product R&D and approval processes must be, according to the dictates of 21 CFRR Part 11, consistent, reliable, and repeatable—in other words, each version of every document must be archived and easily retrieved for the purposes of inspection or auditing.

But this thorough documentation means that the approval process can be streamlined with automated functionality, as the time needed to send documents to the approving individual(s) will be reduced (with a centralized system, all users may have access to documents, providing they are authorized to do so according to level-specific electronic signatures; also, the system can be configured to send automatic notifications). Consequently, document turnaround time can be reduced, while the authenticity, integrity, non-repudiation, and confidentiality of documents is assured.

Furthermore, for the purposes of an audit, the automated system can aid a company by streamlining document retrieval. With a system that helps you organize and maintain accurate records of all processes, time isn’t wasted on following a lengthy paper trail of documents to ensure that changes have been authorized and tracked, and that all paper versions are now available.

However, it is very important to realize that using a software application off the shelf to automate all processes involved in electronic signatures, document archiving and change management, and tracking and auditing, will not automatically render your company compliant with 21 CFR Part 11.

You must also ensure that you configure the system so it provides you with the validation you need to be compliant—you must establish rules and policies for the application that are consistently followed so you can be assured your processes for electronic signatures and data management are compliant. Both procedural and administrative controls must be in place to ensure process compliance.

Software applications that can help pharmaceutical manufacturers with the issues described above include

* SAP ERP by SAP
* IFS Applications
* DEACOM integrated accounting and enterprise resource planning (ERP) software
* Adobe LiveCycle by Adobe

For insight on the software selection process, check out TEC’s ERP for process manufacturing evaluation center.

Are you in the pharmaceuticals or life sciences industry? Tell us about the solution you’re using to reduce cycle times and manage regulatory compliance.

Ambitious Plans and Promises: How Will the Market Respond to One Enterprise Software Provider's Offerings

2009-09-10T00:00:00.000-07:00

Infor has accomplished much recently in terms of laying the foundation for and developing a product portfolio that meets the needs of customers old and new, as well as those inherited from the vendor's recent acquisitions. Behind Infor's success lies its open SOA strategy, based on the Software Fortress Model (please see part two of this series, Ambitious Plans and Promises: An Enterprise Software Vendor's Course of Action ). For a general overview on Infor's recent developments, please see part one of this series, Ambitious Plans and Promises: An Enterprise Software Provider Keeps Its Word.

While skepticism is understandable from some—especially the over-promised and disillusioned Baan customers, as well as some market observers—most of the market should actually be pleased to hear what Infor is pledging. "Doubtful Thomases" might question whether the former SSA Global, MAPICS, etc. were really killing these products and if Infor is just making itself look good by paying lip service to the promise of improvements. Certainly, only time will tell whether Infor will make good on these promises, or if it will just repeat the sins of the solutions' predecessors.

To be sure, this decision does not come from the goodness of Infor's heart. Rather, it is based on sound economic (i.e., the great revenue potential from the several thousand existing Baan IV and V customers worldwide) and strategic reasons (i.e., Infor envisions Baan and LN as "platform" rather than "mature" enterprise resource planning (ERP) products, having viable future road maps, including SOA bus and enhancements), as well as to create goodwill (press relations).

At first, Infor may have been tempted to enable migrations to Infor ERP LN 6.1, but it is likely the vendor has realized that the migration paths for Baan IV and V customers, their systems significantly customized, would be prohibitive and daunting. Possibly then, it is more feasible and justifiable to keep all three product releases on their own SOA-enablement and functional enhancements paths. Sure, the research and development (R&D) cost for Infor will increase to a degree (given their monolithic structures, Baan IV, V, and LN will have to be divided into separate fortresses), but that is certainly a lesser price to pay than losing those customers outright to the competition.

Therefore, given three different product road maps, the details are currently sketchy about what customers can hope for in terms of functionality, as well as how useful these products will be in light of some customers having modified the product to a level where it is hardly recognizable.

In any case, if Infor will indeed be adding features, that can only be good. There have been broad indications of enhancements being made to financial management, supplier relationship management (SRM), human capital management (HCM), servicing, warehousing, and manufacturing functions. Moreover, this might even be more about Infor Open SOA and Infor's need to cross sell products to these customers, since Infor's revenue model is based on keeping the maintenance stream going and cross selling products. To that end, via the Open SOA approach, Infor will likely offer the Baan install base extended-ERP systems from other Infor point solutions, particularly in the areas of corporate performance management (CPM)/analytics, supply chain management, (SCM), business-to-consumer (B2C) and business-to-business (B2B) e-commerce capabilities, mobile applications, and so on.

Some skeptics may also point out that the initial additions planned for Baan IV and V are mostly what we would call regular upgrades and extensions. However, for those Baan users whose product instance is not that badly modified, the price of becoming compliant and up-to-date on their own (i.e., using their own regulatory and IT experts) might be much higher than the price of being reinstated into the service and maintenance contract (see What Is the Value Proposition of Support and Maintenance?).

Further, the details on IBM's current Baan and LN capabilities and its success in reselling these Infor products are also sketchy at this time, and we will have to wait and see if the two companies actually sell some of these solutions. IBM used to be a major Baan implementer in the 1990s, but like almost all other leading systems integrators (SIs), it has since all but disbanded the Baan practice. These experts have moved on to implementing other ERP products, and it is questionable how easily one can ramp up the competencies of Baan and LN once again.

Furthermore, IBM resells many mutually competing enterprise applications products; while the total number of deals for IBM is certainly significant, deals for each individual ERP vendor are very rare. Yet, vendors like Infor or Lawson Software like the fact that IBM resells their product, due to the added credibility IBM's name gives these products in the marketplace, but it is questionable how much revenues they can actually expect.

In any case, while skepticism is understandable in light of the past, the fact is that 22 percent of Infor's employees (about 2,400) work in the R&D department. Looking at this from another angle, Infor's R&D expense last year was about $400 million (USD), which represents 18 percent of its total revenues—an amount significantly higher than the software industry's average of 14 percent. Such numbers are indications of a vendor that "means business" and that wants to be in for the long haul—and the vendor certainly has no illusions that this will be a "cakewalk" (easy).

Quote-to-order: One Big, Lean Machine Adds High Tech to Its Mix

2009-09-09T23:59:00.000-07:00

In the first part of this series (please see Quote-to-order: New Ingredients in the Recipe for Success), the emerging quote-to-order (Q2O) sphere was discussed in terms of its history and current developments, as well as how software providers are rising to the challenge of meeting their customers' Q2O needs. The second part, Quote-to-order: Newcomer Causes a Stir in the Market began an in-depth analysis of how the vendor BigMachines has been claiming a space for itself, serving clients in the high tech industry with its Q2O solutions.

BigMachines' Differentiation

BigMachines' differentiation from its competitors, especially from the "old-guard" (with client/server on-premise technologies), comes from many directions. The lean front-end (LFE) moniker is meant to indicate that BigMachines is "leaner" than its old-school competitors, particularly those with much broader enterprise suites, because

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Its solution is solely focused on managing the full end-to-end inquiry-to-order process (quoting, configuration, and proposals) executed by customers' sales teams and channels, whereas most competitors stop short of truly empowering sales with one generalist solution that tries, suboptimally, to manage all aspects of the sales order process.
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The on-demand technology and implementation methodology takes less time and resources than implementing older technology based on client/server or on-premise technology—in other words, "faster is leaner." Additionally, on-demand administration tools can allow customers the flexibility to maintain and change their solution over time as their businesses change, which is another fundamental shift from older technologies.
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Native reporting and analytics come on top of customization via on-demand administration tools and self-administration by customers. The user interface (UI) can be tailored to match distinctive customer quoting processes, which leads to custom implementation (system configuration) rather than custom programming for each customer.
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BigMachines' team has process expertise and experience deploying the solution across a variety of industries for the most complex applications, while its management team has experience working for the world's best and leanest companies: McKinsey & Co., Case, Hewlett-Packard (HP), General Electric (GE, with a Six Sigma Black Belt entitlement), Dell (also a Black Belt holder), Accenture, etc.

BigMachines has also made substantial investment in services and support over the past several years. The vendor's press release of July 2008 notes that

[t]he company has expanded its Customer Support program to include a new online Support Center, an interactive customer idea forum called "My BigIdea", and online customer collaboration tools. BigMachines' online Support Center provides the company's global customers with a single point of entry to a repository of support information and tools, as well as an interactive community to share best practices and drive innovation in product design and development. In addition, Web 2.0 community applications have been added, including My BigIdea, an interactive forum where customers can submit their own ideas for product enhancements. Using My BigIdea, other customers can view the suggestions, add their own comments, and vote on the ideas they would like to see implemented. My BigIdea provides a wealth of information to the company's Product Management team as they plan and prioritize product roadmaps.

This is the same type of collaboration platform implemented by both Starbucks ("My Starbucks Idea") and Dell ("Ideastorm").

Other new support features include the following:

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an integrated global customer relationship management (CRM) platform to manage customer accounts and contacts
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an online support center Web portal to provide a single point of access for customers
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a helpdesk with new voice over Internet protocol (VoIP) system integrated with a CRM system to ensure that BigMachines' support agents have relevant customer information at their fingertips

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a customer knowledge base to provide access to a comprehensive solutions database online, 24/7, 365 days a year
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online customer collaboration tools to share ideas within the customer community and directly with BigMachines staff
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dashboards and metrics-reporting tools to track and monitor helpdesk case load, including causes, volume and frequency of issues, and patterns and trends over time, to ensure continuous improvement

Additionally, the July 2008 press release states that "BigMachines has also created a new Customer Success Management team. Customer Success Managers are responsible for proactive communication to customers, sharing best practices, and ensuring that BigMachines['] customers achieve full adoption and value."

Given that the above traits are not necessarily applicable to distinguishing among software-as-a-service (SaaS) Q2O peers (such as Firepond, Webcom Inc., Click Commerce, Sterling Commerce, etc.), BigMachines touts its leadership with more than 100 successful customers. Two enterprise-strength data centers with guaranteed uptime and the product's scalability and internationalization are also advantageous here. As mentioned earlier, BigMachines has also established partnerships with leading global services firms for global implementation services and customer support capability.

Since Statement on Auditing Standards 70 (SAS 70) audits are a big deal for all on-demand applications providers that want to sell into large enterprise clients, BigMachines' hosting partners are SAS 70 Type II–certified, and the vendor is undergoing its own stringent SAS 70 audit, to be completed mid-2008. Compliance with the Sarbanes-Oxley Act (SOX; see Thou Shalt Comply (and More), or Else: Looking at Sarbanes-Oxley) is also important in the sales quoting space, particularly concerning documented approvals for pricing or discounting by representatives and channels, and for customer's contract pricing. BigMachines has also helped many of its customers with these issues.

Complex Industrial Machinery Experts

BigMachines has "ruled" the market segments of complex industrial and process machinery that handles liquid, gaseous, and solid materials, such as pumps, valves, actuators, compressors, mixers, agitators, etc. The vendor's staff is thus well-versed in specifications that include the valve's operating conditions (such as fluid properties, size, desired materials of construction, and connection type), as well as the actuator type and other related accessories.

In the case of mixers and agitators, staff are quite "au fait" (fully competent) with the detailed specifications of things like viscosity, blending times, and volume of the material. It is critical that such information be encapsulated in the software system because it determines specifications such as the motor speed, impeller design, and shaft length of the product. From these specifications, the user can then select such options as end connection, body material, actuator type, seal type, and material, while the online configurator can also dynamically generate figure numbers, bills of materials (BOMs), and drawings to help an engineer complete a plant design.

To be even more attuned to this target market, BigMachines has opted to participate in the initiative of the nonprofit consortium FIATECH AEX. This initiative will eventually include the development of standard Extensible Markup Language (XML) schemas for motors, air coolers, reciprocating compressors, pressure vessels, centrifugal fans, centrifugal compressors, control valves, storage tanks, relief valves, and transmitters.

But, to also expand from these niche industries, BigMachines has lately found and penetrated new markets for expansion and growth, including high tech, software, networking hardware, medical instruments, and services markets. In a dramatic shift, these new high tech and other markets now represent over 70 percent of BigMachines' customers acquired over the last several years. The SaaS CRM market is more heavily dominated by these newer industries, and the faster growth expected of SaaS versus traditional client/server technology will likely continue this trend.

Multi-tenant "SaaS-y" Debates

To get into subtle multi-tenant SaaS nuances, BigMachines has a hybrid SaaS model with a multi-tenant database and dedicated Web front-ends for each customer. The application is delivered as SaaS, and unlike several of its competitors, BigMachines doesn't have a parallel client/server on-premise business, and no off-line technology is required to set up and maintain its software.

Like the rest of its product suite, BigMachines' administration engine (for system setup and maintenance) is fully on-demand and delivered only via the Web. This engine enables flexibility for users to add channel partners (value-added resellers [VARs], distributors, third-party agents, etc.) with or without licenses to other integrated applications. Also, fully on-demand administration tools enable globally disparate administration teams. Some of the competitors, such as Firepond, claim to be "multi-tenant/on-demand," but in reality, they only have a multi-tenant user front end, whereas off-line client technologies required for all product data and rule maintenance with periodic publishing of the off-line client tool to a multi-tenant Web front end.

BigMachines' hybrid (in other words, not completely multi-tenant) architecture has the flexibility to allow customers to upgrade according to their needs and desired schedule, and not necessarily when the vendor decides to upgrade them or another of the customers wants to upgrade. The architecture also has the flexibility to tailor the UI to the unique needs of the sales processes of different customers and industries.

For example, e-commerce and channel scenarios, in which a distributor is guided through the sale process of a gas turbine, are fundamentally different from the way that a software company representative is guided through the modules, number of users, commercial terms, and service fees of a software and services implementation. These different users may require very different layouts of their configuration pages. Despite the single-tenancy of the UI, the solutions allow its customer administrators to change or maintain the product anywhere in the world from a Web browser.

Challenges Spare No One

However, Webcom, a competitor that has the pervasive multi-tenant SaaS solution as well as a traditional on-premise one, cites the customer's choice as an aspect of flexibility as well. In fact, there are indications that many quote-to-order (Q2O) buyers within the complex engineer-to-order (ETO) environment may still prefer the on-premise, behind-the-firewall deployment. That gives lots of maneuvering space to the likes of Cincom Systems and Experlogix. Cincom recently introduced a specific strategy for the SAP ecosystem for customers with product complexity beyond what the SAP Internet Pricing and Configuration (IPC) product can handle, while recently the Cincom Acquire product was certified for Microsoft Dynamics and Microsoft .NET technologies.

Along similar lines, Experlogix is Dynamics-certified and also involved within Infor's ecosystem. Access Commerce too is integrated to QAD and Infor enterprise resource planning (ERP) products, and there is always the traditional single-tenant hosting option provided by these vendors.

The point is taken that BigMachines' customers very much value the flexibility to schedule (and test) their upgrades and interfaces. These companies are running mission-critical systems that process orders; not all enterprise systems are as critical, nor do they need this flexibility. Still, a single-tenant UI for each customer means more costs and less profitability for the vendor (a downside in addition to the distraction of having to track each customer's exact product release). Namely, one of the true benefits of a multi-tenant architecture is lower cost structures for the vendor to maintain (savings that are hopefully passed on to customers). In other words, every single customer gets the same attention when it comes to requirements: the vendor that does not maintain multiple product instances does not have to take resources away from enhancing the product.

After all, despite its impressive growth (Technology Evaluation Centers' [TEC's] estimate of the company's revenues are at about $10 million [USD]) and achievement of its profitability targets, BigMachines is still a small startup into which over $40 million (USD) of venture capital money has been invested, and one may never know how much longer the investors will patiently wait for the true "payday." Also, BigMachines' subscription pricing per user per month is somewhat higher than its SaaS peers.

While the vendor claims that it is good value for its leading product on the market (which also involves embedded reporting and analytics), others might look at it as the company's somewhat desperate need to grow faster and generate more cash flow for its investors. However, BigMachines believes premium products should carry premium prices, and the company must justify its value and high levels of re-investment into future products and services.

One challenge BigMachines must contend with is the competition presented by ERP players in the Q2O market. For one, prospective customers inevitably delay their decision to implement an Q2O system, as they try to validate an incumbent ERP provider's claim that its product can do the Q2O job as well as a system specially designed to handle Q2O processes and issues. Even when the company selects a Q2O specialist like BigMachines, one has to wonder whether it is a strategic decision or a tactical stop-gap measure (while the ERP provider catches up with the functionality).

Also, there are indications that Oracle and IFS are working on (or have completed) a single engine, which, as stated in a report from AMR Research about Oracle Configurator, "can be used for modeling both sales and back-end (engineering) product configuration, eliminating the need to synchronize sales and product configurators."

Thus, some Q2O players have espoused more value proposition by building much broader business-to-business (B2B) supply chain management (SCM) suites for multichannel commerce. The first one is Click Commerce, which was made private by Illinois Tool Works (ITW) two years ago, but remains an independent operating company (see Will a Tool Manufacturer and a Supply Chain Software Vendor 'Click' in Matrimony?). According to AMR research, while sales configuration remains a component of the suite, the company targets companies looking for the broader B2B e-commerce capabilities the suite offers, such as catalog management, guided selling, pricing, partner relationship management (PRM), warehouse management, spare parts optimization, and trade funds management.

Along similar lines, Sterling Commerce (which recently acquired Comergent) has meanwhile combined its configurator and PRM capabilities with other software assets to address broader customer order management. In 2007, Sterling announced an offering called Sterling Selling and Fulfillment Suite, which addresses multichannel distributed order management (DOM) through fulfillment. It is needless to say that these two high-profile companies have no viability issues like their startup SaaS peers do.

The Business Model for the 21st Century Is Project-centric

2009-09-09T23:58:00.001-07:00

The need for agility in business grows ever more pressing. Reacting in real time is vital, and time is a commodity always in short supply. Many companies are currently heavily focused on financial measures, especially how the numbers look at the end of accounting periods. While financial reports are important, relying on them too heavily can lead to a business geared to analyze the past rather than one driven to manage the present and prepare for the future. If your business is driven by accounting periods alone, then it is poorly equipped to react as dynamic situations unfold. Reacting to financial results is like reading the newspaper—you can see what has happened, but it is much too late to do anything about it.

Traditional organizational structures and systems can make understanding real-time operational situations almost impossible, delaying corrections, costing the business money, and—in a downturn—even threatening its survival.

The criteria for business success are normally measured in financial terms, but the day-to-day management to ensure these monetary goals are met needs to look beyond pure historical financial-reporting. Today, success is all about the difference between measurement and management.

Cost, time, resources, cash, and risk have long been the five fundamentals of project management. These performance indicators need to be observed and controlled in real time in order to manage and deliver a successful project. Projects typically cross departmental—and often company—boundaries, and they always have a start and an end. In today's business climate, there is much that can be learned from this approach to help manage the whole organization through the downturn and beyond—even for businesses that do not see themselves as operating in traditionally project-driven sectors. Project management techniques, applied across the board, can help an organization evolve into a true project-centric business.

In today's globalized business environment, a project-centric approach means putting together the best mix of resources—people, production, design, sales, marketing, service, and so forth, both from within the organization and from the extended enterprise—for each product and service offered by the business in order to ensure the best chance of success. This may mean moving away from traditional thinking. Traditionally, production has always been done in house, with certain products tied to specific locations. Today, for instance, a manufacturer must make a business case whether to make or buy a component or an entire product. If you have the right information in real time, you can make the necessary strategic decisions about which resources to use, where to locate elements, and whether to perform various tasks in house or through subcontractors, outsourcing, or offshoring.

The right mix to deliver success can often change. The benefits of yesterday's cost-driven decision to offshore manufacturing to China might be offset by tomorrow's increase in delivery costs due to rises in the price of oil. A historical perspective on costs is no longer enough to manage the business. Moreover, cost savings must be balanced against nonfinancial measures, such as quality, skills availability, and environmental concerns, as well as risks such as the potential impact on brand and reputation. The focus must shift from backward-looking financial measurement based on accounts and cost centers, to company-wide management of cost, time, resources, cash, and risks, supported by real-time information.

This project-centric concept needs to be instilled throughout the business, at all levels and across all departments. Many managers and executives are left with systems that don't provide easy access to performance metrics in real time. It is often these individuals that regard a project as something that delivers a specific service or tool to the business, and who don't see it as a fundamental approach to delivering the core goals of growth and profitability. By compartmentalizing the role of projects, those management teams are missing out on a very efficient approach to running the complete enterprise. Structuring the whole organization on an integrated set of projects enables success to be clearly identified, measured, and communicated. As we approach the back end of the 21st century's first decade, the project-centric approach is evolving into a clear structure for the modern, agile business.

Project management techniques should no longer be the reserve of specific industries or departments. Setting precise goals, with a defined budget, to be reached within a specified time frame, is now more common than ever before. The fundamentals of project management are now core to companies specializing in areas such as contract manufacturing, construction, and contracting, as well as in the service and traditional asset management industries. These sectors are likely to have taken a project-centric approach to running major parts of their business some time ago.

The construction and contracting industries are great examples of the project-centric approach. They are 100 percent project-focused in how they deliver products and services, but do they take the same approach to make sure the financial goals of the business as a whole are reached? Some do, but not all, as even these types of businesses struggle with measuring the past rather than managing for the future. Real-time visibility throughout the whole project life cycle, across organizations and all company business processes, is the key to success.

Improve Visibility

Building a company's business on a network of integrated projects not only sets out the logical steps to business success, it enables managers and senior executives to have better and faster visibility of progress, enabling operational and financial risks to be managed more closely, corrections to be made, and the consequences minimized.

What is key here is that businesses see the project as a real-time execution model, not just as a framework for planning and follow-up. Project-centric business applications make this work, integrating information across all departments, such as human resources (HR), finance, production, and others. This agility is even more essential in a tightening global economy.

The current accepted approach to business makes understanding a company's real-time performance difficult. Quarterly figures are often not available for weeks after the end of the reporting period, so this information is already out of date by the time it is available to the business. Yet chief executive officers (CEOs), investors, and customers are demanding more visibility, improved real-time access to information, and faster reaction to change. Taking a project-centric approach pulls together forecasted, estimated, and actual metrics, and puts monitoring in place to provide a view of all elements—not just financial actuals.

Operational and financial risks can also be evaluated on an ongoing basis, and strategies can be defined upon these. This approach delivers a level of analysis on which decisions can be made quickly and with confidence. The business becomes agile.

Project metrics are common practice for staff of all levels. They provide the right insight into the business. An enterprise resource planning (ERP) system that is built on project-centric fundamentals can provide the insight that managers need to understand the immediate situation, and the effect that adjusting resources, costs, and timings on individual projects will have on larger financial goals.

Significance of Time

Time is a great leveler, as the problem of allocating time applies to all businesses, irrespective of size and financial strength. For example, it has been proved time and again that the first product to enter a market achieves the highest profits. It is better to be a leader than a follower, and launching a new product into a new market involves major risk, cost, cash, time, and the best use of key resources. This is a forward-looking application of project-centric thinking.

It is often stated that the key constraint to execution is the availability of key executives' time. For example, when pursuing the global expansion of a business and establishing international operations, being able to execute to a predictable time plan is paramount. Maintaining the timeline is difficult if key executives do not have real-time visibility of ongoing processes, preventing them from proactively making timely decisions. This is a clear benefit of the use of project-centric business applications.

Project-centric Businesses

More and more companies in the manufacturing sector need to look at their product portfolios and the mix of in-house production, outsourced production, and after-sales services and spares that will deliver the greatest profits. Contracts often run for defined quantities of specific products over a finite period of time. The manufacturer may have several projects on the go at any one time. Globalization has made outsourcing easier for the established brand owner. As a result, more and more businesses have increasingly complex supply chains.

Changes in the global economy have released such industries as utilities from public ownership, and have created global players that own many different businesses in different countries. Sales and marketing entities in western Europe are selling electricity that is generated by a different company and delivered to the consumer on a network owned and run by yet another company. This focus on a core business service by different entities in the supply chain enables those holding the relationship with the consumer to chop and change providers to suit consumer demands and producer improvements. Suddenly the whole business is being run on project-centric fundamentals: cost, time, resources, cash, and risk.

But what does it mean for your business? The CEO of today must embrace this project-centric approach and manage the business by focusing on the five elements presented here. There must be a change from siloed organizations geared to measure the past, to companies driven to manage the present and to prepare for the future. This is a world where companies need to become project-centric, using systems that provide the agility needed to react instantly. To ignore this challenge will make it difficult to weather the downturn and stay ahead of the increasingly global competition.

Quote-to-order: A Newcomer Causes a Stir in the Marke

2009-09-09T23:54:00.000-07:00

provided a detailed background of the still-evolving quote-to-order (Q2O) space, including historical examples to show why the market is increasingly demand driven. Part one summed up by making general observations as to how Q2O software solution vendors have addressed the market, and about the additional features and functionalities they will need to incorporate as demand shifts.

Now it's time to take a look at one of those high-flying "newcomer" providers: enter BigMachines, Inc. (www.bigmachines.com), a rapidly growing company founded in 1999, and with North American headquarters (HQ) in Chicago, Illinois (US), and European HQ in Frankfurt, Germany. The vendor also offers global customer support and hosting operations with a technology center in San Mateo, California (US), a West Coast data center in San Francisco, California (US), an East Coast data center in Sterling, Virginia (US), and an Asian research and development (R&D) center in Hyderabad, India.

According to the BigMachines Web site and associated press releases, the vendor is a provider of on-demand configurator, quoting, and proposal software and associated professional services. Its clients are in the high tech, industrial equipment, medical instruments, and software and services industries. The company's solutions help its clients' sales teams and channels to streamline their selling processes from customer inquiry-to-order. The BigMachines solution digitizes complex selling processes and captures an organization's tribal knowledge. By doing so, it provides online product selection, configurator, quoting, and ordering capabilities for new products and aftermarket parts, and streamlines configuration, pricing, quoting, proposal generation, and order management. BigMachines' rapidly growing customer base of over 100 corporations includes global leaders such as Kodak GCG, Siemens, Ingersoll Rand, and NTT Communications, as well as innovative growth companies such as ShoreTel and Aruba Networks.

Getting Cozy with Customer Relationship Management (CRM) Powers

BigMachines' Lean Front-end (LFE) solution provides reporting capabilities that help analyze sales activities, and integrates to existing enterprise resource planning (ERP), computer-aided drawing (CAD), and CRM systems, including those from Salesforce.com, Oracle CRM OnDemand, Oracle, and SAP.

For Salesforce.com and Oracle CRM OnDemand customers, BigMachines offers two different product editions: SPP (standing for selection, pricing, proposal) and CPP (standing for configuration, pricing, proposal). The SPP is an entry-level solution that does not include the configurator module. Both solutions enable users to streamline their entire Q2O processes, all within the familiar Salesforce.com CRM interface.

The CPP and SPP product pricing capability includes BigMachines' certified and packaged integration to these two CRM products above. The vendor also offers Professional and Enterprise editions which have different price points, minimum numbers of users, bundles of other BigMachines modules, and other add-on original equipment manufacturer (OEM) software. All of these product editions are part of the umbrella BigMachines solution.

For instance, as noted in a BNET article from 2006, BigMachines'

SPP solution extends Salesforce.com's functionality to enable users to generate rich and accurate proposals. SPP users can quickly select the right products to quote to the customer by searching for products using multiple search criteria, including descriptions, part or stock-keeping unit (SKU) numbers, product families, price lists, and other custom fields. Users can add the selected product(s) to a quote with one click, and the quote is automatically populated with address and customer data from the related Salesforce Accounts and Contacts tabs. Quote and revision numbers are also generated automatically and all changes are tracked.

The article goes on to say that

[r]ich proposal packages can be generated in Adobe (.pdf) or Microsoft Word (.rtf) formats, and include cover letters, product descriptions for each line item, pictures, graphs, drawings, marketing collateral, and terms and conditions. All relevant proposal data is automatically populated back to the Salesforce Opportunity… [ensuring] up-to-date pipeline data and [eliminating] manual data re-entry. Quotes can be converted to orders with one click and submitted electronically to the business system via BigMachines Integration.

According to Big Machines, more than half of its customers are "the result of a 2005 certification agreement forged between the two companies," and SPP and CPP have since been available through the Salesforce.com AppExchange marketplace of on-demand applications.

Mid-2007, BigMachines announced the general availability of BigMachines CPP for Salesforce PRM (standing for partner relationship management), a best-of-breed application designed to help companies manage quotes and generate accurate forecasts across multiple sales channels. BigMachines' CPP application is now fully integrated with Salesforce.com's on-demand PRM solution. BigMachines CPP for PRM extends Salesforce PRM by empowering channel partners to more quickly and accurately configure solutions, generate their own quotations, and sell products more easily and quickly, while capturing channel quoting activity with direct integration to the Opportunities, Reports, and Forecasts tabs in Salesforce.com.

BigMachines CPP for PRM also integrates a slew of new features to improve the sales process for channel partners.

In 2006, BigMachines announced in a press release that the integration between its on-demand LFE solution and Oracle's Siebel CRM On Demand was "successfully validated" by Oracle. At the same time, BigMachines also became a Certified Partner in the Oracle PartnerNetwork (OPN). As mentioned above, BigMachines' offerings help enable sales teams "to configure complex products, manage complex pricing and up-sell options, create quotes and proposals, and send error-free orders to ERP systems or order entry personnel." As for Oracle, "its multi-channel offerings allow organizations to manage and coordinate all customer interactions across the Web, contact center, field sales/service force, branch/retail network, and indirect and partner distribution channels."

The same press release adds that

[t]he integration of BigMachines with Siebel [Oracle] CRM On Demand allows users to populate quotes and orders directly with Siebel [Oracle] CRM customer contact data, and then link detailed quote and order information directly to CRM opportunities. This helps reduce manual data entry across multiple systems, and provides an integrated view of sales wins and losses across customers, accounts, and opportunities.

[BigMachines' solution] can be configured to customer needs using on-demand or on-premise platforms, and can integrate with Siebel [Oracle]CRM On Demand or on-premise as needed.

Quote-to-order: New Ingredients in the Recipe for Success

2009-09-09T23:47:00.000-07:00

One of Technology Evaluation Centers' (TEC's) series of articles focused on an emerging class of front-office e-business and customer relationship management (CRM) applications aimed at managing what is being termed the lead-to-order, configure, price, quote (CPQ), or quote-to-order (Q2O) set of processes in the complex multichannel sales environment (see Q2O Systems: Solutions for Quotation Management and Pricing Configuration).

This software category has to do with much more than product configuration. As suggested by a 2002 article from Manufacturing Computer Solutions,

it automates the processes from "needs analysis" (what the customer wants and why), through option recommendations, to configuration and change management (including validation), pricing, quoting and financing. The emphasis is on right-first-time and business process web automation.

This applies equally within the context of business-to-business (B2B) and business-to-consumer (B2C) e-commerce. (See also The Perfect Order – Inside Out or Outside In?).

Why Such Demand for Q2O Systems?

The reasons for the recent healthy market interest in these applications are manifold. For one thing, there has long been the need for mass customization capabilities within manufacturers' operations. In a supply surplus economy, almost all products and services are made more customizable to meet customers' exacting needs.

The best example is the evolution in the automotive industry from Ford's 1914 Model T to today's Ford lineup and the ability for customers to even build their own cars online. To be fair, in the 1930s, the long defunct Duisenberg car manufacturer let "celebrity" (deep-pocketed) customers buy a unique, customized car; but the point here is that this has increasingly become a prerogative of the general population today.

The coffee shop industry is another great example of creating value via mass customization. While the ordinary, corner-store filter coffee still generally costs $ 0.99 (USD) a pop, a highly customized cup of coffee can easily amount to several bucks (or 50 cents per syllable, anecdotally). Those who prefer "an extra-hot, half-decaf, triple-shot, vente, sugar-free, low-fat milk, vanilla, extra-foamy dry latte" know all about this.

Furthermore, personal computer (PC) industry leaders are also moving from selling solutions with basic configuration to those that are more customized and higher value, while both hi-tech and industrial products are increasingly packaged into higher value-added customer hardware and software solutions and accompanying services.

Besides mass customization, some ill-fated "dot-com" ideas from the early 2000s are back now, but with a refined value proposition and backed by the latest technological developments. Thus, in 2007, the MFG.com Internet marketplace reported that in the preceding 12 months, the $2 billion (USD)–value was sourced on the site. Then, beside unstoppable globalization, as described in Don Tapscott and Anthony D. Williams's book entitled Wikinomics: How Mass Collaboration Changes Everything, there is a "perfect storm" (or "category six business revolution") in the market owing to Internet generation demographics, broadband pipes, and networks going on everywhere in the global playing field.

The mass collaboration phenomenon is the direct result of many online collaboration tools being readily available for shared innovation and development, forums and knowledge bases, and peer production. In fact, collaboration nowadays is rather about efficiency and driving costs down by maintaining win-win relationships and working together (with the idea of shared, paperless repositories of information). This differs significantly from the concept behind e-commerce tools in their first incarnation, which had everything to do with driving down supplier prices (and thus reducing costs).

According to a 2002 article from Manufacturing Computer Solutions, the vast majority of global manufacturers (about 90 percent) have a number of predominantly B2B relationships, while only about 20 percent sell directly to end consumers. Also, they have multiple sales channels, mostly with agents and distributors, necessitating (for example) slick and easy-to-use digital catalogs, portals, and product configurators for sales support.

Thus, being on the same page has become the name of the game; proposals and other similar documents must be clear, concise, and use acronyms and vernacular that rings a bell with decision makers.

Contemporary technology has rendered integration of formerly separate point solutions into more cohesive Q2O suites much easier. In other words, it is nowadays more feasible to standardize and integrate systems and customer-facing processes, such as generating multitier channel leads, taking and fulfilling customized orders (with highly configurable items), and coordinating warranty, spare parts, and other post-sale services.

Some realization of identifying and empowering a single "inquiry-to-cash" process owner (to provide a unified, single face to the customer) has also been helping to defuse the conflict of multiple functional groups traditionally claiming ownership of various parts of the process at most companies. Consequently, the inquiry-to-cash processes are no longer siloed by functional areas, such as sales, marketing, engineering, fulfillment, or finance departments.

As products and services become more complex, the work of internal sales people, partners and distributors, and direct sales forces has become more difficult than ever. Yet, today, the majority of customers using complex equipment still use cumbersome, manual processes to specify and purchase sophisticated equipment like pumps, compressors, or valves.

On the other hand, manufacturers (suppliers) also rely on manual processes (the so-called "quote-and-hope" or "if it passes, fine" methods) that thrive on fragmented product knowledge (the so-called "tribal knowledge" or "chasing the expert" phenomenon), long lead times, and costly and inefficient proposal generation. Not to mention the complication when dealing with the indirect channel with the lack of consistency and visibility, when multiple companies, functional departments, and people have to be involved. In addition, the complicated purchased equipment often has to be correctly sized and configured to meet the customer's application requirements, which requires process and related technology know-how.

In addition, the pricing and commercial terms can be quite complex as companies have multiple price lists and various channel- and customer-specific pricing policies. Thus, any process improvement solution must be able to fulfill both the technical and commercial requirements, as well as facilitate an efficient information flow and collaboration among all parties involved.

While technologies and tools like guided selling are critical elements of customer self-service sales, giving tools to salespeople is also crucial. Salespeople seem to fall into two proverbial categories: "eagles" and "journey-people." Eagles are the intuitive, fast-moving, high-flying minority, those who take to sales easily and excel in the role. Conversely, journey-people are pretty much everybody else, and although they make a comfortable living at sales, they need ongoing coaching and enabling tools to improve.

New Web Technology Developments Certainly Help

On the B2C side, turning casual online shoppers into buyers takes a personal touch, and that is where the latest generation of e-commerce personalization tools comes in. As a recent article in the Wall Street Journal points out, this software produces product recommendations "behind the scenes" that cater to individual tastes and needs on a supplier's web site. Compared with earlier versions, the latest tools, besides being much more affordable, perform more (predictive) analysis of buyer activity, and the resulting recommendations are more likely to reflect the interests of individual customers.

The article goes on to say that personalization is an increasingly used tactic on the Web, since it often results in significant improvement in conversion rates (i.e., from "just browsing" to "now buying"). Thus, tools for analyzing individual buying and browsing habits have existed for some time. However, early tools—in spite of a steep price tag—were simply not robust enough to transform this analysis into useful or accurate results.

Such analytical tools are now both cheaper and more powerful, some even featuring the ability to operate in "hands-free" mode (in other words, without necessitating human intervention; see also Using Predictive Analytics within Business Intelligence: A Primer).

Helping to Establish Cross-departmental Metrics

For its part, the B2B environment requires even more special analytics (metrics and key performance indicators [KPI]) and sophistication (see Differences in Complexity between B2C and B2B E-commerce). In addition to logically expected improvements of quote and order accuracy (to eliminate costly and unnecessary customer service intervention before the order can be processed, which in turn contributes to lengthened lead times beyond the typical forecast window, while in some cases, erroneously omitted components need to be added in at a supplier's cost), other potential benefits can be derived from deploying a Q2O system. AMR Research's report Sales Configuration—From Efficiency to Excellence (from late 2007) suggests that such benefits include the ability to use the data gathered during the configuration process to feed the demand (forecasting) signals; to make better decisions on future product features and options, configuration constraints, and recommendations rules; and even to determine entire product lines across seasons and geographies.

The report goes on to say that manufacturers increasingly realize the need to improve demand visibility as a driver for sales tools like guided selling and configuration, since a well-deployed Q2O system can determine demand variability and product variants' profitability.

Also, in the spirit of mass customization, the report claims that pushing historical configuration data back into the product lifecycle management (PLM) process can lead to products with broader appeal and lower production costs. AMR has identified a broad trend of manufacturing organizations becoming interested in using insights gathered in the sales process for demand forecasting, product development (including rationalization and parts standardization), field service, and overall improvements in the customer experience.

"Leaning" the Front End Too

Additionally, while most lean initiatives start on the manufacturing floor, the time has come for best-in-class manufacturers to apply the basic philosophies of lean (in other words, continuous improvement and waste elimination in business processes while delivering more value to customers; see Lean Manufacturing: A Primer) to other parts of the enterprise. Many manufacturers that made improvements in their back-end manufacturing processes have meanwhile recognized that significant opportunity still exists to reduce manual effort and costly errors in the front-end selling and services.

According to Godard Abel, chief executive officer (CEO) of BigMachines (to be featured in parts two and three of this series), the same lean thinking can be applied to complex product specification, quoting, and ordering processes, by mapping the steps and identifying those that add value and those that are wasteful. Some of the most apparent examples of wasteful steps include

* repeatedly clarifying and checking prior work due to incomplete information flow

* re-entering (re-keying) order data multiple times in various systems

* fixing specification and engineering errors after an order has been placed

* re-work, warranty, and plant rescheduling costs caused by faulty process and application engineering

Lean initiatives have recently driven some cutting-edge manufacturers to identify objectives for a more effective front-end process, specifically to eliminate manual processes and the need to rely on a wide variety of paper-based tools (such as catalogs, price books, and sizing tables), as well as homegrown software such as that for sizing compact discs (CDs). Many existing quotation and order-entry processes involve many redundant steps and labor-intensive manual processes that only add lead time and complexity to the value chain, as noted in a 2007 case study (Case Study: Rolling Out Lean) published in Quality Magazine. The case study also notes that

given the complexity of some products, the processes used to create quotes and orders become slow and error-ridden, and manufacturers realize the need for a technology enabler that meets the challenges of this lean front-end vision to reduce non-value-added activities, leverage best practices and knowledge, and develop a "mistake-proof process" for product selection, configuration, pricing, quoting, and ordering.

In addition to analyzing their current customer-facing processes, companies need to analyze the tools and systems that support front-end information flow during these processes.

Broad Enterprise Systems Providers Largely Coming Up Short

Moreover, traditional enterprise application software packages have not easily supported the management of end-to-end inquiry-to-cash processes. Enterprise resource planning (ERP) systems, for instance, have traditionally been weak in their ability to handle sales, marketing, and product configuration tasks. Another weak spot for ERP products is in generating proposals, whereby manufacturers can set up Web tools to automatically generate proposals online, complete with all of the technical and commercial data the customer needs to evaluate the quotation. This can include cover letters, product descriptions, technical datasheets, performance graphs, drawings, and commercial terms and conditions.

Consequently, a slew of well-funded start-ups have flooded the market with integrated modules that can be mixed and matched, so that enterprises can assemble a package of tools that suit their needs instead of committing to a single product with flaws that they're unlikely to be able to fix. The latest Web 2.0 technologies have helped in that regard, like so-called "mashups" that enable two on-demand Web applications to work seamlessly as one via Web-services integration.

As these customer-facing applications become more sophisticated and cheaper, thereby providing the potential for users to automate and improve what are currently largely disconnected, often manual business processes, one should expect increased Q2O penetration within small and medium enterprises too. Some Web-based software-as-a-service (SaaS, see Software-as-a-Service's Functional Catch-up) Q2O providers have been riding on the wave of the booming on-demand market. Besides the well-known success of Salesforce.com and NetSuite, the SaaS market was particularly validated by the recent launch of products like SAP Bysiness ByDesign and Microsoft Dynamics CRM Online, while Cisco also acquired the SaaS Web-conferencing pioneer WebEx.

Web 2.0 technologies create rich, dynamic user interfaces (UIs), for which the innovation is nowadays really being driven in the consumer market because of the "survival of the fittest" theory. In other words, an individual can switch from using Yahoo to Microsoft MSN to Google Ads with a click, whereas a heavyweight enterprise package or database could take years to unplug.

However, while the Q2O space is seemingly prosperous and experiencing hardly any consolidation, the vendor landscape has shifted quite a bit over the last few years. A crop of next-generation, Web-based, on-demand, startup providers has flourished, among them BigMachines, which has seen considerable growth in the past couple of years.

Vendors Harness Excel (and Office) to Win the Lower-end of Business Intelligence Market

2009-08-18T23:09:00.001-07:00

The charge for business intelligence (BI) is of absolute and accretion cardinal accent for all action applications users because of bread-and-butter and authoritative pressures. Unfortunately, users rarely feel that they get all (or most) the advice they charge from their action software systems. Business intelligence is aswell accustomed as analytics, admitting there are some distinctions amid the two. BI is a broader set of technologies and means, admitting analytics refers to specialized software that analyzes abstracts about a accurate anatomic area, like marketing, sales, absolute estates, etc. Both accept been inseparable from action adeptness planning (ERP) anytime aback the abstraction of business automation via advice technology (IT) way aback in the 1960s. However, ERP, and BI and analytics accept had altered user experiences, evolutionary paths.

Namely, although ERP systems accept absolutely adapted abounding enterprises' business processes, abounding users accept been larboard activity oversold, and cutting feel that these systems arrest admission to the basic advice that appears hopelessly bound in the system. Often, in a lot of acceptable ERP systems, a bulk of banking and added operational activities are aggregate calm to anatomy artificially created processes, which buck little affinity to absolute business activities. For example, about the focus of an ERP arrangement has appeared to abandoned be about accepting the absolute abstracts into the accustomed antithesis (GL) and to actualize a transactional excess (for added advice on the alpha of action applications, see Action ApplicationsвЂ”The Alpha and Future, Revisited.).

Special absorption needs to be accustomed to baby and average business (SMB) customers, accustomed that BI is aswell analytic for them in today's fast-moving, aggressive markets. However, appropriate appliance accept to be accustomed to the alarming attributes of basement investment. Typically, abounding SMBs go with what is inexpensive, available, and what gets them affective after a abrupt software acquirements curve. About by default, their solutions circumduct about Microsoft Excel or added spreadsheet programs, and sometimes including advertisement accoutrement anchored in packaged applications.

Anecdotally, Excel is advised the world's a lot of accustomed analytic tool, and is about advised to be a aggressive artefact and even a barrier to admission for BI vendors, partly because Excel ships with every archetype of Microsoft Office, which, in about-face is a accepted basic on millions of accumulated and abandoned desktops. Further, about anybody is accustomed with Excel, and some users accept already become spreadsheet buffs, and Excel covers abounding appropriate bases in agreement of visualizing, manipulating, publishing, and administration information.

Many SMBs do not wish to angle out a abundant bulk of money an "enterprise-level" BI apartment that they accept to delay to abound into afore acumen the system's abounding potential. Yet, afraid with their rudimentary, congenital advertisement and analytics amalgamation that came with their introductory-level accounting or added alcove action appliance is not a band-aid in the continued run either. However, the availability of PivotTables and PivotCharts and the adeptness to handle absolute time abstracts feeds has added the abeyant of appliance Excel as an analytic user interface (UI) for abounding SMB action applications. PivotTables are interactive, cross-tabulated Excel letters that abridge and assay data, such as database records, from assorted sources, including ones that are alien to Excel; and PivotCharts are archive that accommodate an alternate assay of data, whereby users can change angle of data, see altered levels of detail, or accommodate the blueprint blueprint by boring fields and by assuming or ambuscade items in fields.

Moreover, affiliation with Microsoft SQL Server Assay Services' online analytic processing (OLAP) cubes provides a blazon of optimized, multidimensional abstracts antecedent for BI analysts. As the Microsoft SQL Server database moves added down the bazaar with lighter releases for SMBs, and is alien about as the absence database engine for added SMB action applications, the adeptness to added advantage abstracts in SQL Server becomes accession important anatomic asset of Excel.

It is appropriately a baby admiration to see the contempo admeasurement of Excel-based BI and analytics accoutrement that advantage add-in applications from a bulk of vendors. These may be a applicable another for SMBs, aback the accoutrement are usually simple to install and accommodate absolutely into Excel's menu, advice system, and worksheet and workbook pattern. They usually amount a few hundreds dollars or less, and can be bought one at a time, about by abandoned downloading them from the Web. Conversely, boilerplate BI vendors who advertise BI or accumulated achievement administration (CPM) add-ins to beyond enterprises, usually apprehend multi-user seats that abandoned can advance software authorization fees up into bags or even tens of bags of dollars, which, in part, funds their expensive, absolute sales archetypal and approaching artefact development that not all users will anytime need.

Given its parent's database and BI belvedere forays, Microsoft Business Solutions (MBS) has aswell added the bulk of analytic accoutrement accessible through its four ERP artefact curve and the Microsoft CRM product. So far it has mainly relied on its FRx Software assay for abundant of its analytic functionality, admitting abandoned in the branch of banking management, reporting, budgeting, planning, and forecasting (see FRx Poised to Permeate Abounding Added Accustomed Ledgers). The Microsoft Great Plains and Solomon ERP articles accept predominantly relied on FRx and the banking advertisement area. Both Navision and Axapta will be alms the FRx affiliation (already the case for Axapta and on roadmap for Navision) and accept been absorption on the build-in address writers in accession to the OLAP solutions too.

Some of MBS' bigger BI functionalities adeptness alfresco of the banking advertisement domain, and there are some notable examples including.

* The availability of OLAP offerings for the majority of the ERP artefact lines, acceptance for ad hoc assay of operational, as able-bodied as banking data;

* The addition of Microsoft SQL Advertisement Casework Address Packs for Microsoft Great Plains and Microsoft CRM (and Axapta anon to come); and

* The anchored use of notification casework acceptance both Navision and Great Plains users to subscribe for an automated notification if abstracts changes occur.

Further, banking statements created in Microsoft FRx or budgets created in Microsoft Forecaster can be exported to Excel for added assay and administration or they can be adapted into an Excel PivotTable for added assay and charting of key data. The consign adequacy to Excel PivotCharts and PivotTables was not absolutely meant to advice in navigation, aback FRx DrillDown Viewer supports acceptable navigation. However, they do abutment added or added akin of assay of GL data, forth with the adeptness to abutment the charting of abstracts while appliance one adaptation of truth.

The latest account backpack artefact absolution for Microsoft FRx 6.7 (SP3) appearance Microsoft FRx Address Astrologer that was advised to accommodate a simpler way to architecture and aftermath reports. It offers three versions of accumulation and accident (P&L) statements (rolling quarter, absolute to account variance, accepted and year to date); antithesis sheets; and balloon balances from accounts in a array of ERP and accounting packages. All of these letters accept bound formatting choices (seven or less).

To be a bit clearer here, depending on what blazon of address is getting developed, it will yield the user seven or beneath accomplish to complete the astrologer and assassinate the report. For example, a balloon antithesis address can be able in four steps, one of which is a final acceptance step. Forth the way, the user has the adeptness to administer some formatting changes to the report, such as alteration row titles, adjusting row order, alteration fonts, and formatting of the report. The user aswell can aftermath a address based on authoritative hierarchy, and can baddest the aeon to run the address against. The FRx Address Astrologer was not advised abandoned for baby bussiness customers, but for any chump in MBS' ambition bazaar of small, medium, and ample businesses, and capacity of all-around enterprises. The antecedent anticipation was that this adequacy would be abnormally advantageous for new or exceptional users. However, the bell-ringer has reportedly begin that accomplished barter are appliance this adequacy too, because of how bound they can set up and run a key report.

The absolution aswell appearance Microsoft FRx Address Manager (for creating authoritative address books), Microsoft FRx WebPort (for web-based administration and admission of Microsoft FRx address output, forth with added Microsoft Office certificate types), and Microsoft FRx Currency Translation add-on's and achievement anon to Microsoft Excel PivotCharts and PivotTables. The abandoned absolute MBS artefact that has yet to be chip with Microsoft FRx is Microsoft Navision; about this will not be the case for long. During the contempo MBS Convergence 2005 conference, MBS appear that in the aboriginal bisected of 2006, Microsoft FRx 6.7 will be chip with Microsoft Navision 3.0, and Microsoft Navision 4.0 will aswell be introduced. Also, in the aboriginal bisected of 2006, Microsoft FRx 7.0 will be introduced, with added Microsoft Business Portal appearance and abreast Office articles metaphors.

As for the added FRx Software product, Microsoft Forecaster, its accessible absolution 7.0 will affection a new Microsoft Outlook-like UI, added adding capabilities, adult "what-if" clay support, workflow, and aegis capabilities. These will added facilitate the Web-based, collaborative attributes of this periodical, time-consuming allotment and planning action that involves the ascribe of several departments. The adaptation is planned for absolution in the third division of 2005 and will be absolutely based on Microsoft .NET managed code.

Microsoft Forecaster 8.0 is appointed for barrage in the additional bisected of 2006, which will added aggrandize accepted animal assets (HR) management, revenue, allocations, and adjustments capabilities. Both the Microsoft FRx and Microsoft Forecaster articles will, in the continued run, be rewritten absolutely in the Microsoft .NET managed code, and will eventually allotment accepted functionality. Currently, they affection abandoned a bound bulk of accepted abstracts and cross-over functionality, not to acknowledgment two altered "look-and-feel" paradigms.

MBS has aswell added the analytic abilities of its ERP and accounting packages, which already accommodate some Excel capabilities for analytics. Namely, the advertisement and analytic capabilities in Microsoft Axapta, Great Plains, Solomon, and Navision acquiesce users to consign letters to Excel. Furthermore, the predefined OLAP cubes hosted on Microsoft SQL Assay Casework are accessible with MBS Axapta, MBS Great Plains, and MBS Navision and acquiesce users admission their OLAP-based ERP abstracts anon from aural Excel. As will be explained, this is accessible through the use of Microsoft Office Excel Add-in for SQL Server Analysis. GL allotment in these applications aswell about allows users to consign account and absolute abstracts to Excel and again acceptation the abstracts aback into the application.

However, although in the approaching all MBS ERP artefact curve will be able to admission Microsoft OLAP cubes via Web services, for the time being, the aggregation is still advising accoutrement developed by some of its resellers, such as Professional Advantage for the MBS Great Plains line, NexVue Advice Systems, and MaxQ Technologies for MBS Solomon. Not abandoned do these articles accommodate analysis, but they are currently bigger ill-fitted for confined assertive vertical markets. This is accountable to change due to the absolution of the Microsoft Great Plains Assay Cubes for Excel.

Yet, not to let the "grass abound beneath its feet", MBS appear in mid-March, that it was continuing to body on its technology alley map that was categorical at Convergence 2005. Through the accretion of a business analytics apparatus and new enhancements to MBS Great Plains 8.0, the band-aid will accept an bigger fit for businesses aural specific industries, greater flexibility, extensions to the product's availability to affix in new ways, and, particularly, a new BI foundation. In particular, it will extend a cardinal new aggregate of BI apparatus to Microsoft Great Plains 8.0 Professional Edition that will cover Microsoft Great Plains Assay Cubes for Excel, key achievement indicators (KPI) for Microsoft Business Portal, and affiliation with Microsoft Office Band-aid Accelerator for SOX, a part of added features.

Critical to the adeptness to action modules focused on business analytics, is Assay Cubes for Excel. Assay Cubes for Excel came from Webhouse code, bookish acreage that Microsoft acquired from Professional Advantage. The code, a disciplinarian of the BI foundation band for Microsoft Great Plains 8.0 Professional Edition, will facilitate the supply of admired BI beyond an alignment by appliance OLAP cubes for added all-embracing assay that should acquiesce organizations to appraise and assay abstracts from altered angles for added acumen into the advice analytic to their business.

Other accoutrement that will enhance the business analytics capabilities of Microsoft Great Plains 8.0 cover Microsoft SQL Server 2000 Advertisement Casework Address Backpack and SmartList Builder. By appliance the SmartList Builder, businesses should accept adaptability in defining their SmartList ad hoc queries so that Microsoft Great Plains 8.0 abstracts and third-party applications can be queried added thoroughly. The Microsoft SQL Server 2000 Advertisement Casework Address Backpack will be accessible to acquiesce barter to draw advice from Microsoft Great Plains and actualize analytics letters specific to their business needs. To that end, eight templates will advice businesses draw on the ability of Microsoft SQL Server 2000 to actualize analytic letters for sales, purchasing, and accomplishment functions.

Business Intelligence for SMBs: MBS Excel Applications and Competitive Analysis

2009-08-18T23:07:00.000-07:00

In May, Microsoft appear the availability of a clandestine beta absolution of a new server-based business achievement administration (BPM) agenda application. Code-named "Maestro", the new appliance will reportedly yield advantage of the adeptness of the Microsoft Office Arrangement to advice organizations accomplish added analyses by acceptance them to build, manage, and use scorecards and key achievement indicators (KPI)вЂ”all aural an automated and collaborative environment. It should accommodate companies with a ample appearance of business opportunities, through which advisers could bigger accept business challenges, appearance solutions, and bound assassinate band-aid objectives.

Decision-making is added accident beyond all levels of an organization, and allotment advisers with able business intelligence (BI) solutions should advice advisers to accept a greater impact. To capitalize on this, BI continues to be a accustomed and important breadth of investment for Microsoft's Advice Worker Business division, which is focused on allowance individuals, teams, and organizations be added advantageous with the ambit of programs, servers, and casework that accomplish up the Microsoft Office System.

Enhancing BI technologies that were originally appear in Business Agenda Accelerator endure summer (see Allotment One of this note), Maestro is adapted to business agenda projects for which affluence of use, deployment, and affiliation with Microsoft Office Arrangement solutions are important. Microsoft believes the artefact should acquiesce a user aggregation to do the following:

* Adjust accomplishments with strategy. Abounding companies reportedly attempt to clear business strategies and adjust employees' circadian activities with those goals. Scorecards congenital with Maestro should appropriately accommodate a reliable and businesslike admission to how businesses ascertain strategy, accommodate advice and admission to employees, and appearance how projects adjust with KPIs and objectives. The artefact will acquiesce scorecards, initiatives, and activity affairs to be monitored, managed, and abstinent throughout the organization.

* Accretion added complete acumen into context. Maestro should advice companies accomplish faculty of their business abstracts by putting it in the ambience of KPIs, whereby advisers can accretion added acumen by accumulation the product's scorecarding functionality with reports, charting, graphs, and assay tools, and with baggy abstracts such as documents, spreadsheets, and Web sites.

* Coact on business administration and action. The artefact will accommodate a framework for interpreting and alive with business information, acceptance humans to not alone accept abstracts in its adapted context, but to added finer coact on accumulation assay and yield activity to advance business performance.

* Empower advisers to adviser and bear adjoin key metrics. Integrating with convenient accoutrement such as the Microsoft Office 2003 Editions and Microsoft Office SharePoint Portal Server 2003, Maestro will empower end users to build, manage, and use scorecards, while at the aforementioned time, it will advantage a company's absolute skills, technology, and investments to advice the business get added bulk with beneath bulk and time.

* Achieve adaptable functionality. Although abounding adeptness see Microsoft's accretion its alms from the simple underpinnings of BI, such as online appliance processing (OLAP), abstracts mining, extract-transform-load (ETL), and advertisement tools, to full-fledged BI applications, Maestro should still action a scalable platform. Independent software vendors (ISV), value-added reseller (VAR), and systems integrators (SI) can adapt and extend the offering's functionality or accommodate scorecards into line-of-business (LOB) applications, or actualize added custom applications by application Microsoft Office Arrangement platform, Microsoft SQL Server platform, and Visual Studio apparatus set. Maestro has already been appear to testing partners, such as Panorama Software, as allotment of a clandestine beta release, while a public, beta adaptation is appointed to be accessible this summer. Estimated retail prices and final availability are yet to be determined.

Many accept that Microsoft ventured into the advertisement area of the broader BI bazaar if it aboriginal apparent Microsoft SQL Server Advertisement Casework in 2003, which has aback affected competitors, such as Business Objects, aloft Crystal, and Cognos to accomplish arresting moves. As a result, abounding acclaimed enterprise-level analytic and advertisement vendors, such as Actuate, Business Objects, MicroStrategy, OutlookSoft, or ProClarity accommodate Excel add-in products, appropriately added acknowledging Excel's acceptance at the desktop, abnormally aback even in bigger corporations, not anybody is captivated with the abstraction of familiarizing with yet addition proprietary user interface (UI), workflows, and navigation.

Seeking new advance opportunity, vendors accept been creating new solutions for baby and average businesses and are now alms BI solutions. Hoping to banknote in on the dominancy of Excel, Oracle afresh appear an Excel add-in, fabricated accessible by its acquirement of iLytix Systems AS. Even action adeptness planning (ERP) behemothic SAP believes SMBs will be able to accomplish affecting assets in abundance and business acumen application the new advertisement and BI capabilities accessible in SAP Business One, the ERP artefact geared to the lower-end of the bazaar (see SoftBrands to Institute Fourth Shift for SAP Business One Manufacturing Work-Plan). SAP has and will abide to accommodate the assets and advisers of SoftBrands, a small, privately-held aggregation that it acquired, into SAP's operations and Global Development aggregation as allotment of the transaction.

Former iLytix' XL Reporter fabricated advice from SAP Business One anon accessible in Excel, like it has ahead done with Microsoft Axapta, Great Plains, and Solomon, appropriately eliminating the time-consuming assignment of exporting and re-formatting data. The band-aid aswell allows barter to calmly actualize new or adapt absolute banking and business letters and agenda letters for automated supply to managers, accountant accessible accountants (CPA), and added key accommodation makers. The solution's advertisement and BI appearance accomplish it a able and easy-to-use apparatus for accountants and banking professionals, enabling them to advantage advice from both SAP Business One and added sources for up-to-the minute analytics and acumen beyond the business. Users accept the adeptness to actualize absolute business reports, comparisons and "what-if" scenarios on-the-fly, with new point-and-click and drag-and-drop features. Because the advertisement apparatus uses Excel, formatting, calculations and added activities can be calmly mastered, facilitating boundless acceptance of the solution.

These examples of Excel analytic add-ins or Excel-based articles tend to accept the look, feel, and functionality of Excel, and they about administer a advanced ambit of tasks, abnormally if they are abutting to a multidimensional abstracts source, such as an online analytic processing (OLAP) cube. These solutions about accommodate all-purpose, ad hoc, "slice-and-dice" analytic capabilities, audible analytic functions (such as, abstracts mining, dashboard, or agenda visualization), or the adeptness to accomplish action or operational letters from aural Excel. An added account of frequently accessible capabilities includes

* Excel's adeptness to accept assorted worksheets stored in one workbook book makes it ambrosial for administration conference books. Users can admission their data, busy from assorted abstracts sources and queries in one file, and off-line. Therefore, users can architecture advice into agreeable bales (reports and address packs) that they can e-mail to added users, admission over Web portals, or collaboratively allotment with added Excel users.

* Given Excel's adeptness to "massage data" via sorting, creating formulas, and even acclimation bad data, one can baddest abstracts timberline hierarchies or ambit aural those hierarchies to assemble allusive abstracts views, such as acrimonious absolute cities, artefact categories, or salespeople aural a area bureaucracy to advice with sales analysis.

* Users can cross abstracts presented by these angle by drilling-down, drilling-across (from one bureaucracy to another), or drilling-through (from the arbitrary to alone transaction akin data).

* Given that Excel archive and all the associated controls over scaling, axes, and labels accept become a standard, users can account the abstracts presented by these angle in the anatomy of graphs, tables, bureaucracy trees, 2-D and 3-D charts, scorecards, and top-n or bottom-n rankings.

* Bidirectional abstracts integration, whereby any changes fabricated to numbers during the analytic action can be accounting aback to the abstracts antecedent from Excel. For example, this can be acclimated to access or abatement account or anticipation numbers afterwards they are compared to the absolute ones. Also, users should be able to actualize metadata layers to acquiesce them to bigger understand, acquisition their way, and baddest abstracts in circuitous basal transactional action systems.

* User accept roles-based abstracts security, so that users will alone see what they are advantaged to. They can aswell use simple business rules to highlight exceptions in the data, such as application a numeric beginning to change the blush of the abstracts if a bulk is aloft or beneath the beginning level.

The acceptable spreadsheet admission charcoal accepted admitting its addiction to be labor-intensive, time-consuming, and error-prone. Further, although Excel may be undisputedly the a lot of boundless analytic tool, it is aswell absolutely affected to creating adverse assorted versions of the truth. For example, assorted users will assassinate the aforementioned concern adjoin one axial abstracts barn and unload the abstracts into Excel. Then, one user will clarify the abstracts in Excel with a accurate set of belief and actualize some claimed formulas, while added users will clarify it hardly differently, and some may accomplish errors if creating or application a formula.

Thus, not alive which adaptation of the accuracy is correct, an boundless bulk of time can be spent reconciling the assorted versions rather than accumulation business insight, and the aforementioned action is again anniversary time the concern is active and the after-effects are re-exported. Therefore, application these processes for banking advertisement can could cause adverse Sarbanes-Oxley (SOX) contravention issues, aback there adeptness be little affirmation as to which spreadsheet is valid, admitting the actuality that banking analysts are generally the best-versed Excel users.

Also, while SOX will awning banking reporting, added authoritative reporting, such that for the US Ecology Aegis Agency (EPA) for ecology factors or the US Aliment & Drug Administration (FDA) for aliment and activity sciences, has appropriately austere requirements. Added acrimonious behavior should be implemented to spreadsheets that are analytical to the business. For that reason, adeptness Excel add-in BI accoutrement should be accessible because they can clue buying via countersign protection. They can aswell actualize an assay aisle of changes fabricated to the Excel spreadsheet, and abundance spreadsheets aural a BI repository. The Excel spreadsheet could be active with new data, about by advancement a hotlink to the aboriginal concern file.

Consequently, companies relying on an Excel or an Excel-like arrangement charge to apperceive that while Excel adeptness answer for ad hoc assay and abstracts accumulator for individuals or baby groups, the abstruse breeze of abstracts and referential candor prevents it from a corporate-wide, collaborative accomplishment like planning and budgeting, not to acknowledgment artefact development and sourcing. Users added crave automated analyses application beneath abrasion clicks to accomplish functions such as allocation and highlighting. Additionally, they are searching for added options for graphs and analyses shortcuts that acquiesce specific sub-filtering. But, to added complicate things, while business managers are abundantly blind of the problems associated with application spreadsheets, the IT administration generally commendations these as falling alfresco its jurisdiction, abrogation the administration of analytical spreadsheets in a "no man's land".

Nimble Action Applications Bell-ringer Faces Stiff Challenges in A Aggressive Environment

2009-08-18T23:02:00.000-07:00

In a bazaar acclaimed for its turbulence, the advancing turnaround success of IFS, a all-around action applications supplier, has gone somewhat unnoticed. IFS was the fastest growing action adeptness planning (ERP) supplier in the mid-to-late 1990s. But the aboriginal 2000s apparent a acutely aching aeon for the vendor, including losses peaking at about $85 actor (USD) on revenues of about $313 actor (USD) for 2002. The IFS turnaround is impressive, and its administration attributes the success to its added focused sales strategy, added authoritative efficiencies, and connected accent on a selected, acquiescent bulk of vertical industries. For added advice on IFS' background, see Action Applications Bell-ringer Reverses FortunesвЂ”But Will Perseverance and Activity Be Enough?. Aswell see Resilient Action Solutions Bell-ringer Displays Sociability and Businesslike Artefact Development for added on the keys to the vendor's turnaround.

Part Three of the alternation Action Applications Bell-ringer Reverses FortunesвЂ”But Will Perseverance and Activity Be Enough?

Despite abounding observers' animosity that antagonism is alone intensifying, IFS says it cast its chances, if alone because a lot of of its angry competitors are currently absent for assorted reasons. On one hand, the giants like SAP and Oracle are aggressive the ecosystem war and spending top analysis and development (R&D) dollars, possibly at the bulk of new functionality. Given that IFS has brought to bazaar the seventh bearing of its component-based applications (while its competitors are mostly still on their first, or added at best), the acceptance of the service-oriented architectonics (SOA) abstraction agency that competitors' development dollars accept to be acclimated to breach up their caked applications, body humongous SOA platforms, and accommodate and abutment disparate applicationsвЂ”and all this while their barter delay for promises to be delivered. In added words, their barter adeptness be paying an "agility tax," while conversely, IFS can apply on industry-specific business functionality that should accord its barter a aggressive edge.

IFS acknowledges that some barter will accept assumption (sometimes about religious) notions about traveling for SAP or Oracle as a safe choice, but will acquiescently yield allotment in any alternative with a due activity that entails demonstrations of how the software would simulate real-life business scenarios. As a bulk of fact, IFS had a abundant stronger adversary in that attention in aloft JD Edwards, and is absolutely adequate by its bazaar avenue (or, at least, by the product's essentially bargain attendance in new business opportunities of late). A agnate case holds accurate for Intentia, which has afresh been affected in accord with Lawson Software. IFS believes it can appropriately action a absolute alternativeвЂ”big abundant to deliver, while still getting baby abundant to affliction (see How Some ERP Vendors DemonstratedвЂ”Warts And All).

On the added hand, alleged "collectors" or acquirers such as Infor/SSA All-around and Sage Software face the affair of area to focus their R&D budgets so as to antithesis technology and functionality demands, and are still far from a accepted technology belvedere or vision. Microsoft Business Solutions (MBS) is not to be dismissed, but IFS believes that MBS value-added resellers (VARs) accept not consistently been analogously globally strong, competent, or impressive. They about do not display the abyss and history of austere accomplishment implementations, and there are lots of them in a burst market, all aggressive for the aforementioned allotment of pie. Time will acquaint whether MBS' contempo Industry Builder action or the SAP PartnerEdge admission that sounds a little added hands-on (a baddest bulk of approach ally will be arrive to body industry-specific, vertical templates on top of the company's mid-market offering, SAP All-in-One) will prove IFS wrong. For added information, see The Cha(lle)nging World of Value-Added Resellers.

For the affidavit mentioned above, IFS charcoal blessed to accomplishment its advantage as a all-around absolute software bell-ringer (ISV), attributable to its adeptness to bear a single-product, industry-focused ample ERP apartment globally. IFS differentiates on lower absolute bulk of affairs (TCO), aback all its applications are based on the aforementioned cipher abject and accept the aforementioned user interface. This, calm with adopted R&D, has enabled the bell-ringer to afresh accumulate its able artefact development costs able-bodied covered by its alternating acquirement from annual and aliment paying customers.

The IFS Applications 7 suite, which was fabricated about accessible in April 2006 (as promised at IFS World Conference 2005), appearance the seventh bearing of componentized business applications and the added bearing of SOA. The aboriginal 2000s appearance that saw IFS consolidate afterwards amplification aswell saw the bell-ringer architecture a solid technology framework based on SOA concepts and business components. For the annual of some facts and figures, IFS Applications 7 has 159 business and technology apparatus that are diminutive abundant to bear publicized SOA benefits. These apparatus are aggregate into 115 business modules, and barter buy alone the modules they need. Underpinning the apparatus are about 6,000 business altar and abstracts that are acclimated in business processes, and over 800 Web casework that accomplish accomplishments on the business altar (including 200 "report services") and that accept been added acclimated to hotlink IFS to alien systems via XML. To that end, the bell-ringer has continued confused in the administration of Web Casework and blended applications: the aboriginal blended appliance was developed with accomplice ABB and has been accessible aback 2003, and a bulk of added blended applications accept aswell aback been available, or are in progress.

Consequently, the activity constant from the technology mentioned above, and from market-driven artefact development, has become the vendor's basic re-branding themeвЂ”"we'll get in bound and accomplish you agile." As an analogy of activity (or the adeptness to apprehend and acknowledge to abeyant problems avant-garde of time), IFS cites a Norwegian car importer that has afresh broadcast to importing active shoes and administration acreage management, and which bare a arrangement that would not authority it back.

To best authenticate its adeptness and the adeptness to action industry-focused apparatus that will bung into added SOA frameworks (including even those of angry competitors), in June 2006, IFS active a arrangement with Oracle USA, Inc. As a result, IFS will accommodate the maintenance, repair, and check (MRO) allocation of an chip acumen arrangement that Oracle is carrying to the US Air Force (USAF). In accordance with the Oracle contract, the arrangement will abutment 250,000 users of the Expeditionary Combat Abutment Arrangement (ECSS) program, which is a commercial-off-the-shelf (COTS) software arrangement accustomed to advance weapons systems availability by streamlining the accepted Air Force acumen process. The system, which is the bigger IT accretion affairs for the USAF, will alter and accomplish the functions of added than 500 acumen systems that the Air Force currently uses. The Oracle aggregation is accouterment a acumen arrangement consisting of the IFS MRO solution, an ERP band-aid from Oracle, and an avant-garde planning and scheduling (APS) band-aid from Click Commerce (following the contempo Xelus acquisition). Oracle reportedly angry to IFS because it absolutely has a added able-bodied MRO band-aid for the A&D market, and IFS will appropriately accommodate weapon arrangement annex support, including circuitous MRO, basic repair, and agile management

ECSS will acquiesce commanders at all levels in the acumen alternation to automate the action of acquisition acumen data, adapt that data, and accomplish decisions on a abreast real-time basis. It will accommodate an chip set of ERP and APS applications that should acquiesce the Air Force to accomplish its acumen mission, which is to accommodate the appropriate actual to the appropriate place, at the appropriate time, in the appropriate quantity, and in the appropriate action to abutment all-around aggressive operations. The aboriginal appearance entails an over $88 actor (USD) software bulk for the aboriginal six years, which includes Oracle, IFS, and Click Commerce (Xelus). It is hoped that ECSS affiliation will alter over 500 abstracted and bequest systems, and bear accumulation of 20 percent, while the absolute bulk of users will adeptness 250,000. The absolute authorization bulk for IFS, including aliment fees, is accepted to bulk to over $13 actor (USD) over six years, out of which $1.2 actor (USD), including services, is accepted to be accustomed as acquirement in 2006.

A acceptable archetype of how alone regions are in tune with IFS corporate-wide guidelines, admitting with their own nuances, is North America, area the business is aswell in architecture mode. With about 300 customers, North America now contributes 18 percent of absolute aggregation revenue, and the allotment is accepted to grow. The arena has aswell had a about contempo administration change, with Cindy Jaudon (also an IFS "old hand," and aloft baton of the all-around A&D team) demography the captain in aboriginal 2005. Coincidentally or not, for the endure seven quarters, IFS North America has accomplished a added counterbalanced acquirement stream. For one thing, IFS has accomplished that getting apprenticed by new accounts charcoal an big-ticket business model, with an ambiguous aftereffect in the abreast term, while abject the absolute install abject could accept a added abstruse aftereffect on both the IFS top and basal line. That is to say, annoyed barter tend to be added acquiescent to abounding added agency for the bell-ringer to add bulk (which translates into new authorization and annual and abutment revenues) to the chump in an accomplishment to advance the abiding relationship, such as enhancements, extensions, brace and advancement services, and so forth. The action applications bazaar is absolutely a complete and adequately saturated field, and all players accept to appropriately acclimatize their investment strategies from those of the arising and growing bazaar in the 1990s. That agency agilely award a absolute antithesis amid cultivating the install abject against the alacrity for hitching cast new customers.

Furthermore, a lot of sales were absolute until 2005, if IFS started architecture a reseller approach in the region, in allotment feasting on afraid integrators that abutment JD Edwards articles and that are ambiguous about the future. The bell-ringer has six offices in North America, and its absolute sales force focuses on ample and circuitous -to-be customers, while resellers ambition bounded businesses with beneath than $150 actor (USD) in revenues. Consequently, 32 percent of sales in 2005 came from the channel, which is somewhat college than the all-around boilerplate of 23 percent. IFS Applications 7, as mentioned beforehand on, will appear in accessible with its bigger user interface, workflow, and enhancements in the accumulation alternation modules. These modules acknowledge to the requirements for the "splits" amid manufacturers and third-party suppliers (subcontractors) which are acceptable added accepted today. Especially in North America, one can see a about-face in the accomplishment ambiance to one that is based on projects and outsourcing to added countries, and the companies authoritative money are the ones that are outsourcing and accomplishing a acceptable job managing the accomplished project.

In North America, in accession to the A&D industries, area the bell-ringer is leveraging the ample accomplishments and band-aid abyss in EAM and MRO, the medical accessory area is addition vertical of some potential. IFS' band-aid adequacy to accommodate Level 3 authoritative acquiescence has been key to success here. In May, IFS formed a cardinal accord with MTSI, Inc., an industry-focused VAR in the North American market, to barrage new annual managements band-aid for the medical accessory industry. IFS again aswell appear the barrage of SLiM (Service Lifecycle Manager), a software amalgamation that aims at convalescent the efficiency, compliance, and ascendancy of circadian operations in the medical accessory industry. Powered by IFS Applications, SLiM is an chip annual administration arrangement accumulation industry-specific best convenance processes, knowledge, and functionality to abode key business apropos adverse the medical accessory industry, including lifecycle administration and authoritative issues.

US Food and Drug Administration (FDA) acquiescence is a mission-critical claim for medical accessory manufacturers. If a architect violates FDA rules, the after-effects are austere and can cover admonishing letters, binding artefact recalls, disability to address product, and even bent penalties for alone managers. SLiM meets or exceeds the accepted authoritative requirements for operating procedures, certificate control, training records, artefact traceability, and agreement administration allowable by Title 21, Parts 11 and 820 of the US Cipher of Federal Regulations (CFR), and the Sarbanes-Oxley Act (SOX). Targeting medical accessory manufacturers, accessories re-manufacturers, hospitals, and absolute annual organizations, SLiM provides a band-aid at a low admission cost, forth with the scalability to abound into a corporate-wide, chip out-of-the-box band-aid as needed.

Bundled with absorption on alone a scattering of called industries, these moves accept afresh resulted in an added sales win rate, beyond boilerplate sales, and a lower bulk of sales. Added hiring, greater quarter-on-quarter profits, and upbeat annual accept prompted (and in allotment resulted from) the vendor's broadcast bazaar advantage in the region. Specifically, there has been a 15 percent admission in absolute sales and business functions, and tripled aberrant sales and business resources, year over year.

Striking the Blessed Medium of New against Accepted Barter

At the aforementioned time, IFS aims to assure its absolute chump abject in North America (and elsewhere) by befitting them awful satisfied. IFS accomplished a few years ago that it adeptness accept been bigger off slowing development to ensure the adeptness to body added superior into the product, and to clarify its artefact (and services) administration and development processes to acquiesce chump ascribe and acknowledgment at every appearance (via user advising groups, artefact amend and acknowledgment seminars, IFS Applications 7 "test drives," committed chump groups, and so on). Its administration has afresh instituted a "love your customer" culture, and redefined artefact administration and development priorities, with a focus on adorning the software affairs acquaintance (for example, through bigger affluence of use, or absolutely bare anatomic enhancements) rather than a blatant affairs experience. This action has been in tune with the accepted activity of low chump adherence and blockage ability of action applications providers.

The IFS change of mindset came due to the actuality that action software is now a complete market, area the grow-at-all-costs strategies of the agitated 1990s artlessly do not plan any longer. Namely, the banal bazaar of the 1990s saw cast new accounts as a key metric if annual appliance software companies, which collection them to a business archetypal advised to win new accounts that were apparent as the primary antecedent of acquirement by most. For both the broker and vendor, this "new accounts at all costs" approach was the appropriate business model.

But times accept acutely changed, as the bazaar assimilation is so top that alone a few new annual opportunities exist. Moreover, bread-and-butter ambiguity has anchored the purse strings of a lot of -to-be user companies, so that affairs new systems is abundant added difficult. Therefore, added acknowledged appliance vendors are absorption on their install abject of backward as their primary antecedent of revenue, while acid bulk to accommodate profitability. Abounding are even allusive for absolute annoyed barter of competitors. The aftereffect is a affecting change in their business model. Thus, the old "new accounts at all costs" business archetypal accept to now morph to a "love the customer" model, area the cardinal ambition charcoal on absorption added assets on application absolute barter than on alluring new ones. These strategies accept about been fabricated with three objectives in mind:

1. to adjust the authoritative anatomy with accepted characteristics of the bazaar (meaning to aftermath a added deeply focused ambition bazaar and results-based new annual sales and business operations, and to advance accent alone on alive artefact and casework development while attention absolute technology investment)

2. to advance the adherence of operations and the blockage ability of aggregation (in added words, to accomplish assisting growth, banking strength, admission to capital, and operational excellenceвЂ”and to advance constant advantage and absolute banknote breeze as a result)

3. to admission the focus on abacus bulk primarily to absolute barter (by instituting redefined artefact administration and development priorities; by absorption on adorning the software affairs acquaintance rather than the software affairs experience; and by continuing with vertical and alcove artefact enhancements, with a focus on superior [rather than speed], artefact achievement and stability, abyss of functionality, and chump needs).

All these advisable moves are accepted to advice IFS admission and sustain profitability, and IFS North America forecasts a 21 percent advance in authorization revenues in 2006. From the angle of the top band (revenues), the focus is on added alternating licence revenues from annoyed customers, admitting from the basal band perspective, acknowledging and able operations will abide to accumulate costs beneath control, while active awful assisting (with a 61 percent margin) aliment and abutment revenues. Overall, IFS is now financially abiding and viable, has fabricated the appropriate authoritative changes, is adequately impervious from (unwanted) acquisitions (almost 40 percent of the actor votes are captivated by a small, deeply knit, and appreciative group, comprised of Gustaf Douglas, a Swedish entrepreneur, as able-bodied as the founders and management), and has a componentized, future-proof Web services-based technology and businesslike artefact development (harnessing the amicableness and acquaintance of some acclaimed partners) that should accouter it with the agency to win deals in its called verticals.

Lawson Means Business with HCM

2009-08-18T23:01:00.001-07:00

Lawson Software (NASDAQ: LWSN), headquartered in St. Paul, Minnesota, the United States (US), and with offices about the world, provides software and account solutions to about 4,000 barter in manufacturing, distribution, aliment and account breadth industries beyond 40 countries. Its solutions cover Enterprise Achievement Administration (EPM), Supply Chain Administration (SCM), Enterprise Ability Planning (ERP), Customer Relationship Administration (CRM), Accomplishment Ability Planning (MRP II), Enterprise Asset Administration (EAM) and industry-tailored applications.

Lawson has not afresh been accused of getting too exciting, arrant or so, at atomic not compared to a decade ago, if its bygone glossy business apparatus was crafting catchphrases like њself-evident applications (SEA)ќ, њdrill-aroundќ, њweb-addressable applicationsќ and so on. Some contempo attempts in touting accumulated amusing albatross (CSR) and a amusing business atom on YouTube accept been acclaimed (even accustomed by the competition), admitting with alloyed reviews/reception.

Nevertheless, according the њstill baptize runs deepќ adage, Lawsons about calmness absolutely does not beggarly that the bell-ringer has not been alive in the acreage and in its analysis and development (R&D) labs. Ive been fabricated acquainted of abounding contempo moves to assassinate on the roadmap that was categorical at the vendors CUE 2007 conference. In adjustment to accommodate a applicable another to SAP, Oracle or Infor, the bell-ringer has been ablution (or is about to launch) abounding new products, and aswell reorganizing its articles portfolio forth the 5 cardinal artefact curve below:

1. Lawson M3 for Accomplishment and Administration Enterprises [evaluate this product];

2. Lawson S3 for Casework Companies [evaluate this product];

3. Lawson Human Capital Administration (Lawson HCM) [evaluate this product];

4. Lawson User Abundance Belvedere ” to be abundant shortly; and

5. Lawson Systems Foundation (LSF) ” an basal technology stack, in abundant allotment based on the IBM WebSphere stack, that allows abstracted clearing advance for Lawson applications and its technology platform.

The aggregation is even added focused on alleged vertical markets (i.e., healthcare organizations of all sizes, additional mid-market food, fashion/apparel, broad distribution, and accessories account and rental enterprises). In fact, Lawson is alive to become added than just a applicable another in those markets “ but rather an accessible choice.

The big banderole items for the accountable approaching (likely to be appear at CUE 2008 next anniversary in Las Vegas) should cover the absolution of the new user interface (UI) alleged Smart Office. Its above part, Smart Client, has been allotment of Lawson M3 for over a year and has abounding reside customers. This is Lawsons acknowledgment to SAP-Microsofts Duet or added ERP vendors like Office Business Applications (OBA) baby products. The new UI will be activated to both the Lawson M3 and Lawson S3 products.

The Smart Office UI will be bolstered with a new adaptation of Lawson Business Intelligence (LBI) ” aswell congenital for both Lawson M3 and Lawson S3 (in fact, LBI for Lawson M3 is aswell a above cross-sales befalling for the company). Additionally, a new adaptation of Lawson ProcessFlow, a workflow administration application, has aswell been congenital for Smart Office and both the Lawson M3 and S3 lines.

Lawson is aswell accretion its User Abundance Belvedere to entail a lot added than the abovementioned Smart Client, ProcessFlow and LBI initiatives. The belvedere aswell appearance affiliation with Microsoft Office (including the Groove accord product), which helps with getting able to, e.g., barrage HR functions from Outlooks acquaintance account or accepting the HR administration advance its own absolute letters anatomy in Microsoft Outlook.

Also, users are able to dump (export) abstracts to a Microsoft Excel spreadsheet, change the spreadsheet, and again interactively accept the spreadsheet amend basal Lawson applications (with abounding alteration capabilities). Lawsons accomplishment actuality is to let users plan in their њown spaceќ, which is the abode breadth they wish to absorb the majority of their time. For example, managers absorb a lot of of their time in Outlook, and they should appropriately be able to do HR affairs from central of Outlook.

Some action and up- and cross-sell opportunities (even to non Lawson ERP users) can appear from new Industry Solutions, such as Contract Administration (for the healthcare and accessible sectors, as allotment os Lawson S3), e-Sales (for all manufacturers and distributors, as allotment of Lawson M3) and Trace Engine (for aliment accomplishment and distribution, aswell allotment of Lawson M3).

Bolstering Lawson HCM

One accurate cardinal breadth of animated action has been in the HCM space. It is not too surprising, accustomed Lawsons HR administration roots and the markets contempo ability of the cardinal accent of both full-time advisers and contingent, acting workforce.

Lawson is advance with the absorbed of acceptable the all-embracing baton in accouterment chip HCM solutions, and the austere HCM adversary to Oracle PeopleSoft , Kronos and SAP. The development efforts accept afresh been focused on architectonics systems like aptitude acquisition, achievement management, advantage management, acquirements management, and assumption management.

I would brainstorm abounding aural enhancements forth those curve to be apparent at CUE 2008. Codenamed њOrdwayќ, the HCM apartment is aswell slated to be the actual aboriginal artefact delivered accounting (at atomic the above-mentioned new modules) in the Lawson Landmark architecture.

Also, while the apartment will be congenital as a Software as a Account (SaaS) offering, it will a lot of acceptable still initially be offered in the acceptable on-premise model. I am apprehensive why such a alert approach, accustomed that the SaaS archetypal in the HCM amplitude has appropriately far been accurate by the companies like Ultimate Software, ADP, Taleo and Authoria, to name but a few?

The one analytical missing section of Lawsons HCM endeavor has been a able-bodied workforce administration band-aid that includes time & appearance (T&A) and ability scheduling. To that end, in backward February 2008, Lawson acquired VasTech, a provider of workforce administration software and services, headquartered in Annapolis, Maryland, US, with 45 employees. The transaction, which is accepted to abutting in March 2008, is not advancing to accept a actual appulse on the companys budgetary 2008 fourth division or budgetary 2009 after-effects (Lawsons budgetary year ends May 31, 2008).

With this acquisition, Lawson affairs to anon action barter in the healthcare (and possibly in accommodation and gaming, admitting at a after stage) industries an avant-garde workforce administration staffing and scheduling band-aid to accompaniment the Lawson HCM offerings. VasTech fills that gap for Lawson at just the appropriate time, with the cardinal HCM band-aid to be unleashed at CUE 2008.

Healthcare organizations, in particular, are challenged to administer their operational requirements and abiding agents shortages while accouterment high-quality accommodating care. By carrying workforce administration capabilities that advice abode these key challenges, Lawson pledges to abide to strengthen its administration position in the healthcare industry.

Lawsons new workforce administration band-aid will aswell aim to advice healthcare organizations administer a array of acquiescence and advertisement challenges associated with assurance initiatives, activity abundance and staffing levels. This is decidedly important for hospitals as they face austere acquiescence with the staffing capability standards of The Joint Commission “ a authoritative alignment that evaluates and accredits healthcare providers.

The rumor comminute tells me that Lawson has been absorbed in affairs a plan force scheduling arrangement for some time (e.g., the above accomplice Workbrain, afore Infor bought the aggregation for for a ample exceptional over the allurement price).

Therefore, Lawsont action actuality is simple and clear, back it has a amount of healthcare organizations (about 400 organizations, with over 7,000 hospitals) active on Lawson HR applications. All these barter accept scheduling needs, and VasTech 24/7 is a healthcare specific scheduling artefact (nurse about-face bidding, for example).

All things getting equal, these hospitals will acceptable buy this appliance from Lawson and not added providers (e.g., API, Kronos, Infor, etc.) if Lawson has its own offering. If the aggregation manages to advertise it to added types of organizations at some date - that would be great, but the accord is apprenticed by the healthcare segments requirements.

While approaching Lawson workforce administration band-aid will acceptable be acclimatized to serve several industries, Lawson took a actual advised access in its seek for the appropriate cardinal acquisition. The bell-ringer capital the best band-aid for the healthcare vertical, whereby assistant scheduling is a above claiming in hospitals, and VasTech has a accurate band-aid for this challenge.

When accumulated with the Lawson Achievement Administration for Healthcare band-aid (which it acquired 18 months ago as above Competency Assessment Solutions [CAS]) and its cardinal advancing HCM developments, this VasTech accretion should accord Lawson the best all-embracing (possibly easily down) HCM band-aid for healthcare. Almost all of VasTechs audience are healthcare companies, with specific assistant scheduling functions (shift bidding, credentials, etc.) , and that bazaar was Lawsons disciplinarian for this deal.

What are your views, comments, opinions, etc. about Lawsons HCM moves in accepted and in the healthcare breadth per se? We would aswell be absorbed in your adventures with this software class (if you are an absolute user) or in your accepted absorption to appraise these solutions as -to-be customers

A Partner-friendly Belvedere Provider Discusses Bazaar Trends

2009-08-18T22:58:00.001-07:00

TECвЂ™s commodity alternation soliciting vendorsвЂ™ ascribe on a amount of annoying bazaar trend questions and observations showed Infor and IFS as the aboriginal two to acknowledge (see Two Stalwart Vendors Discuss Bazaar Trends). The alternation has back accustomed abundant absorption and reactions from readers and vendors alike. The next in band to articulation its admired opinions was Progress Software Corporation (NASDAQ: PRGS), a Bedford, Massachusetts, (US)-based provider of appliance basement software for the development, deployment, integration, and administering of business applications.

Before delving into this vendorвЂ™s responses, some accomplishments on Progress Software is in order. From initially alms alone a database and accompanying fourth-generation accent (4GL) applications development environment, the bell-ringer has back (particularly during the endure several years, via a cord of advisable acquisitions) garnered a abundant broader set of basement software. This portfolio spans the realms of what the bell-ringer refers to as casework basement (for connecting, mediating, controlling, and ecology servicesвЂ”or software components, if you will), abstracts basement (for managing, integrating, replicating, caching, and accessing data) and business appliance platforms (for developing, deploying, and managing business applications). Therefore, today, the Progress Software portfolio includes the following:

1) Casework Basement Products

The ProgressВ® Sonicв„ў artefact band uses the Sonic ESBВ® messaging-based action account bus (ESB) to accommodate affiliation of new and absolute business applications beyond authoritative boundaries and to bound sites.

The ProgressВ® ActionalВ® artefact band offers Web casework and service-oriented architectonics (SOA) management, including monitoring, analysis, security, and action control.

The DataDirectВ® ShadowВ® RTE (which stands for Real-time Enterprise) enables aboriginal mainframe and bequest applications to participate in abreast SOA and Web casework assembly and consumption.

2) Business Appliance Platforms

The ProgressВ® OpenEdgeВ® belvedere provides development and deployment of business applications that are standards-based, service-oriented, and about accept a lower absolute amount of buying (TCO).

The ProgressВ® ApamaВ® accident processing belvedere can adviser accident streams, ascertain patterns, and respond. The artefact supports event-driven applications, including business action ecology (BAM), algebraic trading, transaction monitoring, bazaar corruption detection, and radio abundance identification (RFID) applications.

The ProgressВ® EasyAskВ® artefact band provides business users and consumers the adeptness to acquisition the advice they charge appliance accustomed accent seek and navigation, acknowledging a array of applications alignment from customer-facing e-commerce web sites to ad hoc query.

3) Abstracts Basement Products

The ProgressВ® DataXtendв„ў artefact band provides abstracts affiliation for broadcast applications and delivers real-time angle of aggregate abstracts in the anatomy applications need. The DataXtendв„ў Semantic Integrator artefact uses a accepted semantic abstracts archetypal to actualize abstracts transformations, enabling organizations to allotment and accommodate amalgamate abstracts after disruption to absolute applications.

DataDirect Technologies is the provider of software for abutting business applications to abstracts and services, active on abounding platforms appliance accurate and arising industry standards. Developers common use on these articles to affix their applications to a ambit of abstracts sources appliance standards-based interfaces such as accessible database connectivity (ODBC), Java Database Connectivity (JDBC), Microsoft ADO.NET (evolution of ActiveX Abstracts Objects), XQuery, and simple article admission agreement (SOAP).

OpenEdge or Cutting-edge Business Appliance Platform?

The capital agent for the bell-ringer is the actual aboriginal Progress product, currently acclimated by over 5 actor business users. The Progress OpenEdge business appliance belvedere nowadays provides a unified ambiance absolute development tools, appliance servers, appliance administering tools, a relational database, and the adequacy to about calmly affix and accommodate with added applications and abstracts sources. By getting adequately accessible to a array of standards, Progress has created the OpenEdge development environment, in adjustment to abstract developers from the complexities of today's accretion environments. This appropriately allows developers to apply on what absolutely matters: the business argumentation of their application. Applications congenital on the OpenEdge belvedere are reportedly portable, reliable, and scalable, yet crave beneath authoritative assets than added deployment platforms. In laymanвЂ™s terms, users call it as a runtime engine that just runs and can be scaled as necessary. Also, a contempo Forrester Analysis address has rated OpenEdge aloft to another platforms attributable to allegation in three areas:

* a 42 percent lower amount of development on the Progress platform

* a 37 percent lower amount of deployment on the Progress platform

* a 48 percent lower amount of advancing administering on the Progress platform

The aloft benchmarks are acceptable the aftereffect of the OpenEdge development environmentвЂ™s adeptness to advance productivity, attributable to a advised business appliance accent alleged Advanced Business Accent (ABL), which somewhat resembles Microsoft Visual Basic or Powersoft PowerBuilder, for faster development. In addition, the industry accepted Eclipse.org-based development environment, alleged OpenEdge Architect, was alien about two years ago. What possibly affairs most, though, is a alone ambiance and accent for server, client, abstracts storage, and affiliation logic. On the added hand, the OpenEdge deployment and administering ambiance promotes efficiency, back the chip ambiance provides simplicity, performance, and lower amount of administration, while it can readily calibration from 1 to 20,000 users.

Last but not least, the belvedere has continued apparent abutment of the a lot of frequently adopted standards (rather than annex on a assertive integration, runtime, or appliance belvedere technology) on all architectural layers. To that end, on the applicant side, users can apprehend abutment for Microsoft.NET, Java, HyperText Markup Accent (HTML), Java Message Account (JMS), Extensible Markup Accent (XML), SOAP, Web Casework Description Accent (WSDL), Java 2 Action Edition (J2EE) Connector Architectonics (JCA), etc. Further, on the server side, there is abutment for Web services, ESB, JMS, Secure Sockets Layer (SSL), Secure HyperText Transfer Agreement (HTTP/S) and so on.

On the database side, beside the vendorвЂ™s own OpenEdge RDBMS (with вЂњRDBMSвЂќ continuing for relational database administering system) that is JDBC-, ODBC-, and structured concern accent (SQL)-compliant, there is abutment for added databases, such as Microsoft SQL Server, Oracle, and IBM DB2. Finally, the deployment belvedere supports abounding operating systems (for example, Linux, UNIX, and Microsoft Windows), while the OpenEdge Administering artefact is simple arrangement administering agreement (SNMP)вЂ“compliant.

However, from accidental to a whopping 98 percent of absolute revenues in 2001, OpenEdge today contributes to вЂњonlyвЂќ about 70 percent of Progress SoftwareвЂ™s absolute revenue, which is advancing the $500 actor (USD) mark. Still, the OpenEdge belvedere charcoal Progress SoftwareвЂ™s Appliance PartnersвЂ™ (APsвЂ™) primary aisle to market, through which the admission generates 65 percent of OpenEdgeвЂ™s authorization revenue. This business archetypal is allegedly awful assisting for both sides, breeding over 5,000 new barter every year. Currently, the belvedere has about 60,000 customers, which represent the aggregate of absolute Progress barter (larger accounts) and users of APs. OpenEdgeвЂ™s all-around bazaar attendance can be discerned from the actuality that its accumulated users are

* nine of the top 10 chump aliment companies

* nine of the top 10 automotive and locations companies

* eight of the top 10 bartering banks

* eight of the top 10 automated and acreage accessories companies

* eight of the top 10 biologic companies

* eight of the top 10 semiconductor companies

* the top six hotels, casinos, and resorts

* the top 5 accoutrement companies

Progress SoftwareвЂ™s primary backbone and bazaar attendance today is in the accomplishment and administration sector, which accounts for about 40 percent of the business, followed by retail, banking services, government, and bloom care.

A Partner-centric Go-to-market Approach

The companyвЂ™s primary ambition bazaar is mid-market enterprises and capacity of ample corporations. These are about absolute barter and partners, while cast new barter can be targeted opportunistically. Nurturing ally is the capital mantra at Progress Software, whose declared mission is вЂњto bear aloft software articles and casework that empower its ally and barter to badly advance their development, deployment, integration, and administering of superior applications worldwide.вЂќ In added words, the vendorвЂ™s declared ambition is вЂњto aerate the allowances of advice technology while aspersing its complication and absolute amount of ownership.вЂќ

Progress SoftwareвЂ™s go-to-market admission revolves about analogous the affairs adjustment to buyersвЂ™ preferences, back baby to average enterprises (SMEs) adopt a bounded supplier that knows their curve of business (in added words, an industry specialist).

On the added hand, a accomplice admission provides adeptness for Progress, whereby the bell-ringer has ally in regions area it does not accept offices (as examples, Turkey, China, or Malaysia). Further, the accomplice admission provides scalability, abnormally in agreement of added accessible account professionals to accomplish Progress SoftwareвЂ™s technology bear on its accustomed abeyant benefits. Endure but not least, a accomplice admission provides greater bazaar penetration. For example, Infor has implemented Sonic ESB at over 1,000 sites, admitting Progress SonicвЂ™s absolute auction has alone 400 sites in absolute (of course, the acquirement accustomed is aswell different, attributable to the beyond admeasurement of these 400 accumulated audience that pay aggregate anon to Progress Software).

Thus, these alone ample action accounts (with revenues over $1.5 billion [USD]) Progress Software targets with its best-of-breed articles for amalgamate SOA, and in a accumbent manner, whereby these enterprises accept ample IT and development staffs and centralized IT objectives. On the added hand, baby bounded accounts (with revenues from $20 actor to $100 actor [USD]) and mid-market accounts (with revenues from $100 actor to $1.5 billion [USD]) in some vertical sectors are targeted alongside via APs or absolute software vendors (ISVs). Such barter about buy packaged applications that custom fit their business or industry needs, and accept abate IT and bound development staff, but crave added accelerated business allotment on investment (ROIs).

This archetypal is absolutely assisting for Progress Software, as it grows the top-line acquirement for a abundant lower amount of sale, abnormally in the case of software-as-a-service (SaaSвЂ”see What is Software as a Service?) deployments.

IDCвЂ™s report, Common Top 10 ISV Accomplice Programs 2006 Bell-ringer Analysis: Enabling ISV Ally for Success, describes Progress SoftwareвЂ™s accomplice affairs as follows:

The Progress Software Accomplice Affairs is a all-around affairs вЂ¦ [that] has predominantly ISV membership, but is evolving to cover aboriginal accessories manufacturers (OEMs) and value-added resellers (VARs). ISVs in the affairs design, develop, sell, and abutment branded bartering business applications congenital on ... Progress Software basement technologies. The affairs has been aesthetic over the years to analyze ISVs with advance abeyant and to abutment those ally with programs, resources, and staffвЂ¦. Progress uses its Advance Date Assessment action to appraise the banking position, business, and abstruse accuracy and capabilities of ISVs.

In accession to over 7,000 developers aural the Progress Software Developers Arrangement (PSDN), the aforementioned address addendum that there are added than 2,000 ally in the Progress Software Accomplice Affairs of all accomplice types. A Progress Software columnist absolution from 2006 credibility out that these ally accept accumulated Progress Software technology with their specialization in architecture mission-critical applications. These ISVs participate in the Progress affairs at one of four levels: Elite, Premier, Preferred, and Member. Assets accessible to an ISV are bent by the ISVвЂ™s advance date or level. For example, the Elite accomplice date targets beyond barter and warrants ProgressвЂ™s demography a one-to-one admission against enrolling, engaging, empowering, and accretion the partner. Conversely, the Premier and Member accomplice stages that ambition SMEs will accept a beneath complex Progress approachвЂ”in added words, one-to-many and accomplice self-service, respectively.

The aforementioned Progress columnist absolution (see hotlink above) Progress Software Ally (or APs mentioned above) accept developed and deployed over 5,000 audible applications, which are acclimated in over 60,000 organizations about the apple and accept been deployed at added than 110,000 locations. Progress cites that it or its APs arrange applications at 10,000 new sites and add 600,000 new users every year. This advance is attributed to ProgressвЂ™ accomplice admission getting far altered than added appliance basement vendors, and is accordant to two of its above constituencies, ally and users.

First, Progress Software ally adore a accomplice affairs that is arguably aberrant in the industry. Similarly to added basement companies, Progress provides admission to its products, abstruse support, apprenticeship and training support, as able-bodied as sales and business support. But clashing a lot of of its competition, the bell-ringer provides to these ally an added portfolio of abetment in agreement of business and abstruse empowerment offerings to absolutely advice them bootstrap their adeptness to accomplish as a business (for example, allowance them with such things as business planning).

This holistic partnering admission to abutment APs through their business activity cycles to ensure collective success includes collective business, technical, sales, and business activities. Second, clashing abounding adversary basement vendors that aswell advertise appliance software, such as Oracle and Microsoft (and added of late, IBM), that are accordingly aggressive with their partners, Progress Software pledges to never advertise appliance software, so that it will never attempt with its ally and cannibalize their businesses.

Product Development вЂњSecret SauceвЂќ

Progress Software cites that OpenEdgeвЂ™s artefact engineering focus is on acclimation the needs of ample end-user barter (who charge connected improvements in scalability, availability, and management), appliance ally (who charge added or added abundance accoutrement and languages, and new and added assorted user-interface capabilities), and of the all-embracing bazaar (in agreement of bigger interoperability and affiliation capabilities, and bigger abutment for new platforms).

To that end, the artefact development amount is 9 percent of absolute OpenEdge revenue, with analysis and development (R&D) agents getting amid both onshore and adopted (80 percent in Bedford, Massachusetts and Nashua, New Hampshire (US), and 20 percent in Hyderabad, India). The artefact R&D investment archetypal is counterbalanced with 15 percent traveling against chump satisfaction, 20 percent on maintenance, 5 percent on accessory enhancements, and the lionвЂ™s allotment of 60 percent on above enhancements or new work.

Business Solutions of the Future

2009-08-18T22:45:00.000-07:00

The approaching is tomorrowвЂ™s present. Many accept approved to adumbrate it application asinine or accurate methods, from chiromancy (palm reading), aleuromancy (fortune cookies), and added -mancies, to the three Ps (possible, probable, and bigger futures) and a W (or wildcardвЂ”low-probability contest with a top appulse on the future) acclimated in futurology.

Without aggravating to actualize a вЂњCRMorologyвЂќ or вЂњERPmancyвЂќ, I aim to abode a alternation of online writing about the approaching of business software. Since this apropos everyoneвЂ”and because IвЂ™m not Nostradamus or Hari Seldon (AsimovвЂ™s acclaimed psychohistorian)вЂ”I would like to absorb you, our readers, as able-bodied as business professionals and accommodation makers from the action software industry. From acceptance with little ability (but amazing imagination), to analysts who apperceive aggregate about the bazaar and vendors who apperceive for abiding what will NOT appear in the abreast future, I charge you to let me apperceive how you see the approaching of business applications.

How Is It Traveling to Be?

A approaching in which business applications will not be bare is too abroad to foresee, so that will not be discussed here. So, if we canвЂ™t reside afterwards these applications, how will they evolve? Will there be one huge, all-around business software provider, employing armies of programmers and chump abutment people? Or maybe myriads of accessible antecedent articles that will plan calm and be as simple to accumulate as the pieces of a puzzle?

I assumption we could let our acuteness aberrate indefinitely, but letвЂ™s get a bit organized here: what weвЂ™ll aim for is seeing what could possibly appear in the next ten, fifty, and one hundred years.

Ten Years in the Future

A decade is not such a continued time, so it should be easier to apprehend the aloft trends in the business software industry that may appear during this time span. Still, even in the abbreviate term, this is absolutely a challenge. Attending at meteorology: the acclimate changes so fast and accidentally that we can alone apperceive for abiding what it is afterwards it has happened.

Speaking of meteorology, I see some clouds acquisition aloft the apple of action ability planning (ERP). Is there traveling to be a storm? No, they say billow accretion is the addition to the acceptable accumulator of informationвЂ”instead of autumn the abstracts on a server in your company, you can put it on abstracts centers anywhere in the world. Some donвЂ™t accept it will work, but it was not so continued ago that humans acclimated to accumulate their money beneath the mattress because they did not assurance banks.

We donвЂ™t assurance banks today either, but we do use cyberbanking and acclaim cards. The aforementioned affair will appear with the clouds: their account and ability will eventually be stronger than the abhorrence of accident data. They already abide and the better in the apple has 150 locations and will abundance 150 actor gigabytes (GBs) every year, or 100 GBs every four minutes.

We will apparently accept acceptable amplitude for the data, but what about its security? According to a abstraction from Oracle, twenty percent of IT managers anticipate that abstracts aegis breaches will appear at their organizations in the next year. And the capital threats are not from bacilli and hackers, but mostly from central the company. Do we charge an accident of massive, common abstracts accident to apprentice from our mistakes (as we allegedly do now), during the bread-and-butter downturn?

LetвЂ™s say we abundance and defended the dataвЂ”how do we admission it? It doesnвЂ™t attending like a botheration now, but it will absolutely become oneвЂ”maybe eventually than we think. According to an IDC report, we created 281 billion GBs of abstracts in 2007, and by 2011, that amount will access to 1,800 billion GBs.

While we do accept added adult accoutrement to abstract and dispense data, one of the challenges of the approaching will be to accept structured data. This involves the actuality of workflows for abstracts conception and administration, abstracts cleansing, and abstracts deduplication (removal of alike records).

Business abstracts is created by users through an interface to a database. Despite the actuality that all action software vendors pretend to action вЂњintuitiveвЂќ and вЂњuser-friendlyвЂќ solutions, the complication of these accoutrement keeps on growing. Since the trend seems to be alignment several solutions in the aforementioned suiteвЂ”most of the time, from altered providers acquired by the aforementioned vendorвЂ”integration seems added important than innovation.

Some vendors action a belvedere as a account (PaaS) (also accepted as cloudware), which is aimed at allowance barter calmly design, develop, and analysis their own applications. Large companies can account from PaaS, as it will acquiesce them to actualize applications tailored to their circuitous needs, appropriately abbreviation costs. On the added hand, already you accept to use a PaaS platform, alteration to addition belvedere becomes actual difficult, and potentially impossible. Will the arising accessible belvedere as a account (OPaaS) abode this botheration by absolution programmers use whatever accoutrement and languages they need?

The way we plan will aswell change. According to a abstraction conducted by Accenture, by 2013, seventy percent of adaptable phones in developed nations will abutment Internet browsers. The aforementioned abode reveals that the millennial bearing (people built-in in the endure decade of the twentieth century) will change the face of the workforce.

Fifty Years and More

If you anticipate about it, 50 years ago there were no ERP, chump accord administration (CRM), or business intelligence (BI) solutions. An accustomed computer would yield up an absolute allowance and actual few humans would accept anticipation that you could abundance hundreds of books on a section of metal alleged a harder drive.

Even added things can appear in a hundred years: we went from chariots to planes and from the telegraph to the BlackBerry in a century. But trends in the change of technology and science can change. Also, it will apparently yield us a while to board all the amazing discoveries of the endure brace of centuries, and this could apathetic down the development of approaching technologies.

As you accept apparently noticed, there are added questions than answers in this blog. That was absolutely my intention. We will apparently not acquisition the answers until the approaching becomes the present, but we should try to accept what to expect. The announcement вЂњWho would accept thought?вЂќ should be removed from the business software vocabulary. Nothing happens afterwards a acumen and we should stop application excuses like: вЂњwe didnвЂ™t see it coming.вЂќ

In my next blog, I will attending at what could appear in the next fifty years, but at the aforementioned time, I will attending to our readers (both individuals and companies) to get complex in this project. I acceptable your feedback.

Inflation's Demise: The Impact on Business Information System Requirements

2009-06-20T08:05:00.000-07:00

Inflation occurs when an abundance of money exists in relation to goods. This creates artificial demand as consumers accelerate their purchases to avoid future price increases. Suppliers, competing to meet this demand, confront temporary capacity shortages that they alleviate by shifting resources to higher-margin goods and raising the prices of lower-margin goods. In addition, they accelerate purchases of material to avert shortages and avoid future price increases. These actions create additional demand for goods, perpetuating the inflationary cycle.

Today's ERP systems originated from Material Requirements Planning (MRP) and Manufacturing Resources Planning (MRP-II) techniques developed in the 1970s and early 1980s. They focus on improving the accuracy, speed and visibility of short- to medium-term resource planning and allocation decisions, thereby improving management's ability to confidently make profitable commercial decisions. They also focus on minimizing operating costs, and maximizing short- to medium-term revenues, through improved coordination and execution of daily sales, engineering, procurement, production, logistics, maintenance and accounting activities. In short, they are designed to maximize profits by timing business events so exactly that productive resources are committed as late as possible, but never too late to miss profitable sales opportunities.

These are very important business problems during inflationary times, because one or two avoidable, critical resource shortages could mean a missed sale and reduced ability to recover fixed costs. For example, accidental over-commitment of a bottleneck work-center or shipping vessel may delay the arrival of finished goods and cause upstream work-centers to shut down until the backlog is cleared. The cost of underutilized upstream capacity is still incurred, even if production or shipping delays cause lost or delayed revenues.

Prices stabilize or fall when an abundance of goods exists in relation to money. This artificially reduces demand as consumers postpone their purchases in anticipation of even lower prices. Suppliers, challenged to recover their fixed costs, now have excess capacity. They respond by cutting the prices of goods, especially their high-margin products, in order to stimulate sales. In addition, they decelerate their own purchases of material to use-up existing stocks, and await future price decreases. These actions further postpone the demand for goods, setting the stage for a deflationary cycle.

At this writing, Asia and other developing regions are slowly recovering from an acute recession and strong deflationary pressure, while other regions (notably, the United States) continue to enjoy robust growth and modest inflation. This disequilibrium has created a combination of inflationary as well as deflationary pressures throughout the world. For instance, demand for goods remains strong in the United States because buyers there still have inflationary expectations. Asian suppliers have cut prices in order to boost export sales and utilize excess capacity.

If, as many believe, the world is in transition from inflation to price stability or perhaps deflation, how will business priorities be affected before, during, and after the transition? How will changes in business priorities affect ERP system requirements?

Just-in-time (JIT) principles became standard business practice during inflationary times. In essence, repetitive purchasing and JIT delivery are tactics for hedging against price increases while minimizing inventory-carrying costs. Buyers negotiate fixed-price repetitive-supply contracts that are fulfilled and paid for over the life of the contract through periodic shipments timed to meet the actual need for goods.

Price stability makes such hedging unnecessary, and deflation makes it highly unprofitable. But buyers will be under even greater pressure to keep inventories low, since the value of inventories remains the same or depreciates in relation to cash. As a result, buyers will insist upon immediate delivery of small quantities whenever they can, at spot prices, although some suppliers will succeed in selling large quantities for immediate delivery by offering "temporary" price reductions, especially during the transitional period. For all these reasons, discrete (order-based) procurement and fulfillment systems can be expected to regain popularity lost to repetitive (schedule-based) systems during inflationary times.

At the same time, buyers and sellers can be expected to monitor competitive spot prices more vigilantly than before. The growing popularity of reverse auctions, data warehousing and data mining testify to the increasing demand for such market intelligence. Demand will increase rapidly for powerful search engines and business-to-business electronic commerce technology to solicit and extract the right information at top speed.

The importance of forecasting systems for short- to medium-term planning is likely to diminish. During inflationary times, suppliers used forecasts, customer orders and future repetitive schedule commitments to anticipate capacity as well as material shortages. Forecast accuracy is critical to the proper timing of business events when capacity shortages exist, but becomes irrelevant when unused capacity is abundant.

Inflation made it profitable for suppliers to be selective about what they sold, and to whom. When persistent capacity shortages exist, profits are maximized by discontinuing low-margin products and rewarding high-margin customers. Performance measures such as Economic Value-Add (EVA), employed in sophisticated sales, product profitability and customer profitability reporting systems, evolved to address this requirement. Suppliers are likely to abandon these tactics when confronted with excess capacity, the sooner the better, and "hunt" instead for as many new customers as they can.

Demand will grow for data warehousing, search engines, opportunity management (OMS), customer relationship management (CRM) and collaborative electronic commerce systems to help the sales force identify and qualify new customers fast. Improved sales incentive, sales engineering and product configuration tools will also be needed to find and close new customer business faster than the competition.

During inflationary periods, non-interest-bearing money owed by trade debtors should be collected as soon as possible in order to maximize its purchasing power, and non-interest-bearing money owed to trade creditors should be paid out as late as possible. In between, this money can be invested in short-term financial instruments or commodities bearing relatively high rates of return, since inflation goes hand-in-hand with higher interest rates and commodity values. Over time, many sophisticated remittance processing, money-management and hedging tools have evolved to meet this requirement.

In periods of steady or declining prices, there is no particular incentive to collect any more money from solvent trade debtors than is needed to meet current obligations. The relative benefits of sophisticated remittance processing, money-management and hedging tools are further diminished on account of the lower interest rates typically associated with price stability. But demand for improved credit management tools and up-to-date creditworthiness data is likely to increase, because of the risk that more customers will be in financial difficulties. Strong demand for sophisticated financial hedging tools can also be expected during the transition, because of arbitrage and currency instability caused by inter-regional disequilibria.

Demand for logistics systems grew rapidly during inflationary times, in support of JIT business practices. These systems cut shipping costs and minimize in-transit inventory investment by coordinating available shipping capacity with production schedules and procurement requirements, improving management's visibility of current shipping schedules and freight rates, and automatically raising and tracking the necessary paperwork. The value of all these benefits is likely to increase during periods of steady or falling prices.

Persistent excess capacity rewards suppliers who can deliver goods faster than the competition, on short notice. Earlier, it was demonstrated that buyers would insist upon immediate delivery of small quantities, at spot prices inclusive of freight, instead of negotiating long-term repetitive supply contracts. In markets characterized by steady or declining prices, a supplier who is able to deliver the goods exactly when they are needed will win the sale at today's spot price that in no event will be lower, and perhaps will be higher, than tomorrow's.

The supplier's ability to honor such commitments profitably, however, requires immediate knowledge of material availability, production status, shipping schedules, best available freight rates and available shipping capacities. Thus, in addition to conventional supply-chain management (SCM) systems, suppliers are likely to demand collaborative electronic commerce systems to help locate the best available means of transportation, carriers and rates. They will also require improved manufacturing execution (MES) and warehouse management (WMS) systems to get an up-to-the-minute picture of their internal production and logistics operations, and to further reduce inventory investment.

As prices stabilize or fall, suppliers will face increasing pressure to minimize logistics costs. This is best done through a combination of advance planning and solicitation of competitive spot-market bids for shipping services. Thus, demand for logistics planning and cost accounting systems can be expected to remain strong.

Overhead costs are distorted immediately, and dramatically, by surplus capacity. Labor-intensive producers can adjust fairly rapidly through labor-force reductions, but capital-intensive producers cannot. Liquidating properties or fixed assets can eliminate the cost of persistent surplus capacity, but the assets may be difficult or impossible to sell. Manufacturers can be expected to implement a variety of short- to medium-term accounting tactics and longer-term financial tactics in order to minimize the adverse consequences.

Tactical accounting changes can be anticipated in the areas of fixed asset accounting, overhead cost allocation and inventory valuation. Possible financial tactics include restructuring of operations to minimize fixed costs, asset liquidation and, worst case, asset write-offs.

Fixed overhead costs are typically governed by original acquisition costs and pre-determined amortization schedules. The periodic amortization cost thus accrued is divided by production volumes to determine overhead costs per unit. Excess capacity drives these costs up as ever-smaller production volumes absorb constant amortization costs. In markets experiencing falling prices, real overhead costs will constantly increase over the long run because deflation increases the purchasing power of the original investment.

Businesses tend to amortize their fixed assets as rapidly as allowed during periods of inflation and high capacity utilization. This minimizes short-term tax liabilities by reducing pre-tax profits, and reflects the tendency of equipment to wear-out faster the more it is used. But businesses competing in markets characterized by stable or falling prices can be expected to lengthen the amortization schedules of their existing fixed assets as much as allowed, because equipment is not being utilized as much and because there are smaller pre-tax profits to shelter. This tactic has the salutary effect of reducing overhead cost per unit, reducing cost of sales, boosting short-term profits and strengthening the balance sheet, thereby improving apparent business performance. Many of today's fixed asset accounting and cost-allocation systems, however, lack the flexibility to implement such changes quickly. Strong demand for flexible replacement systems can therefore be anticipated.

Related inventory valuations and the resulting cost of sales per unit will be affected, too. During inflationary periods, businesses tend to maximize cost of sales as much as allowed, chiefly to minimize pre-tax profits and the value-added tax base. In the future, however, financial controllers will be pressured to change their inventory valuation methods by whatever means necessary, and allowable, to minimize cost of sales, in order to further boost short-term profits and strengthen the balance sheet. As with fixed assets, many of today's inventory management systems lack such flexibility. Replacement systems will be needed to the extent that surplus inventories are being cleared in the short- to medium-term, and to whatever extent a minimum inventory investment is required to operate the business over the long run.

During inflationary times, automation of plant, warehouse and office operations became an important tactic for minimizing ever-increasing labor costs. Capital resources could be substituted for labor, and written-off in constant, periodic amounts that declined in real value over time as inflation eroded the purchasing power of money.

This approach is unnecessary during periods of price stability, and downright unprofitable during a deflation, because the purchasing power of money will stay the same or increase over time while the cost of labor stays the same or declines. Further, replacing fixed assets with variable labor resources gives manufacturers far greater ability to control operating costs in the short- to medium-term. Thus, it is probable that labor's proportion of total operating cost will increase, even if the total labor-force is smaller than before. This trend would likely accelerate as existing fixed assets are retired, liquidated or written-off. As a result, steady or declining demand for plant, warehouse and engineering automation systems can be anticipated. This includes robotic, programmable logic controller (PLC), automated storage and retrieval (ASRS), computer-assisted design (CAD), computer-assisted manufacturing (CAM), statistical process control (SPC) and integrated laboratory management (LMS) systems.

Were a prolonged worldwide deflation to occur, demand may shrink so much that suppliers are forced to shut down parts of their operations, or shutter entire facilities. Attempts will be made to sell the idle properties and equipment for the best-possible price, with attendant capital losses written-off immediately.

Sale of assets is most likely to occur while inflation is subsiding, and before the onset of widespread deflationary pressure, because the assets will appear cheap to investors who continue to have long-term inflationary expectations. Liquidations and write-offs will have an immediate, and beneficial, effect on cost of sales, to the extent that periodic amortization costs are significantly reduced in relation to production volumes.

These tactics would not require any significant changes to existing business information system capabilities, but the number of general business systems in-use can be expected to decline as operations are scaled back and facilities closed. These include functions such as general ledger, accounts payable, accounts receivable, inventory control, production control and cost accounting.

Reduction of overhead costs at remaining operations is likely to be a key priority, as well. Older general business systems tend to incur relatively high operating and maintenance costs. Meanwhile, information technology costs have fallen dramatically. As a result, some manufacturers will replace their older general business systems with newer, less-expensive versions, especially if doing so will enable the other tactical changes described in this article to be implemented faster. But many older business systems have already been replaced to address recent Y2K concerns, so the ongoing need for replacement systems is likely to be limited, at best.

Labor Cost Control

During periods of persistent surplus capacity, manufacturers can be expected to reduce their variable labor costs as much as possible. This may be done through elimination of overtime, shift reductions, work-hour reductions, temporary or permanent pay cuts, temporary or permanent layoffs, and reduction of employee benefits. Further, operations may be scaled back or eliminated at high-cost union shops, as well as within high-cost or restrictive labor markets such Germany and labor markets characterized by low unemployment such as the United States.

These effects will be moderated by substitution of variable labor for fixed assets in the drive to control overhead costs, as previously demonstrated. In doing so, however, manufacturers are likely to accelerate the redeployment of productive capacity from high-cost, capital-intensive locales such as the United States to low-cost, labor-intensive regions such as Asia or Central and South America.

These actions may have adverse and increasing social effects, as dramatized by recent protests in Seattle and Washington, D.C. against the International Monetary Fund and World Trade Organization. Worker demands for improved economic security may lead to renewal of isolationist policies in some locales, which would effectively reverse the economic liberalization and globalization trends of recent years.

Business models designed to optimize performance in the previous climate of unrestricted free trade will have to be adjusted to take account of the artificial incentives and penalties created by any new government regulations. This is likely to create new demand for localized regulatory compliance systems that address taxes, duties, tariffs, prohibited goods and foreign exchange controls. At the same time, reduced demand can be expected for general business and supply-chain management systems designed to integrate the unrestricted operations of multinational enterprises.

Business Planning and Improvement:

A variety of tools and techniques evolved during inflationary times to improve productivity and maximize profits. These include material requirements planning integrated with capacity requirements planning (MRP-II), advanced planning and scheduling (APS), activity-based costing (ABC) and total quality management (TQM). All of these techniques address business problems created by limited capacities. MRP-II and APS tools are designed to maximize the utilization of existing capacity through improved coordination of individual production and procurement activities, without necessarily improving efficiencies or yields. ABC and TQM are essentially diagnostic tools for identifying the root-causes of inefficiencies and defects, and enable management to monitor the effectiveness of corrective actions. Used together, these tools allow management to wring maximum productivity from its existing capital investment, before additional long-term capacity investments are considered.

In a period characterized by stable or falling prices, fewer new long-term capacity investments will be considered. Instead, gradual disinvestment of existing capacity may occur. Before disinvestment, there will be little or no real benefit from using capacity requirements planning, APS, ABC or TQM tools except to improve the coordination and efficiencies of a smaller labor force. But even in so far as labor utilization is concerned, greater business benefits will accrue from short- to medium-term adjustments to the number of resources employed, rather than continuous long-term improvement of labor efficiencies.

Materials management is likely to remain a top priority, for reasons demonstrated earlier. After clearing excess stock, suppliers will be under intense pressure to keep inventories to an absolute minimum, since their value will remain the same or depreciate relative to cash in the event of a deflation. Expanded use of discrete (order-based) master scheduling (MPS), material requirements planning (MRP), manufacturing execution (MES) and warehouse management (WMS) tools can be expected in order to properly schedule and manage materials in small quantities, on a JIT basis. Continued deployment of quality assurance and control tools for the purpose of improving finished product yields and minimizing waste can also be expected.

Manufacturers' business priorities will change significantly if a worldwide transition from inflation to price stability or deflation occurs. Many new priorities will be the opposite of those followed during inflationary times. This will have a major impact on market requirements for enterprise systems. The most likely impacts are listed below.

Significant decreases in marketplace demand can be expected for:

Repetitive purchasing, order-entry and release management systems
Sales forecasting systems
Capacity requirements planning (CRP) and advanced planning and scheduling (APS) systems

Some reductions in new marketplace demand can be expected for:

Industrial automation devices and systems (robotic equipment, programmable logic controllers, computer-integrated laboratory instrumentation)
Warehouse management and automated storage and retrieval (ASRS) systems
Computer-assisted design and manufacturing (CAD/CAM) systems
Statistical process control (SPC) systems
General business systems (general ledger, accounts payable, accounts receivable, inventory control, production control and cost-accounting)
Sales analysis systems
Advanced remittance processing and money-management systems
Activity-based costing systems
Global supply-chain management systems

Some new marketplace demand can be expected for:

Interactive inventory-control systems
Interactive pricing and promotional systems
Logistics planning, execution and cost-accounting systems
Flexible inventory valuation systems
Localized regulatory compliance systems
Quality assurance and control systems

Significant new marketplace demand can be expected for:

Discrete (order-based) purchasing and customer order-entry systems
Interactive electronic commerce (Internet) technology for product catalogues, price lists, reverse auctions, collaborative purchasing, customer order acceptance and payment, shipping schedules, shipping rates and shipping capacities
Data-warehousing and data-mining engines for competitor prices, prospective customers and customer creditworthiness
Sales engineering and product configuration systems
Opportunity management, customer relationship management, sales force automation and commissioning systems
Flexible fixed asset accounting systems
Flexible overhead cost allocation systems
Order-based master scheduling (MPS), material requirements planning (MRP), manufacturing execution (MES) and warehouse management (WMS) systems

Who's Got the Better Windows Office Suite? Corel or Microsoft?

2009-06-20T08:04:00.000-07:00

The subject of this note is the never-ending question within desktop office suites, " What's better, Corel's or Microsoft's?" Generally, this question is answered from an emotional perspective, based entirely on the specific administrator's and/or end users comfort level. There is no one correct answer, both desktop office suites excel in specific areas and pale in others. The contents of this note will pit the two systems against each other in four specific areas:

Product Functionality: Feature functions contained within the product
Product Technology: Protocols, databases, and platforms
Product Cost: Initial cost of training, implementation, and support
Service and Support: Vendor support following purchase and implementation

Product Strategy and Trajectory:

TEC analysts began assessing the pros and cons of both office suites through the construction of a detailed information repository with over 300 detail-level criteria, arranged hierarchically in our proprietary software-modeling tool, TESS�. Each hierarchical category within the model is assigned a value, which represents its priority relative to other categories, or "weight". Figure 1 shows weights for the top-level categories in the Desktop 2000 Office Suite Model.

Figure I Top Level Rating

Figure II represents Product Functionality
versus Product Technology

In functionality and product technology Microsoft's Office 2000 takes a slight lead. This is primarily due to the advanced web based integration features and integration with the standard Microsoft Windows desktop. In addition, Microsoft Office 2000 includes an e-mail client (Outlook 2000), which is lacking from Corel's offering. Corel excels in ease of use and reduced training costs. Overall, both suites offer a plethora of features from advanced desktop publishing to robust databases.

Corel WordPerfect Office 2000 takes the edge in enhanced accessibility through the inclusion of Dragon Software's Naturally Speaking application, which allows a user to "talk" to the application rather than type. In addition, the Corel 2000 Suite includes a hardware component headset/microphone combo intended for speech recognition.

Figure III represents Product Functionality
versus Product Cost

Corel's WordPerfect 2000 Office Suite Standard is competitively priced at $299.95 (MSRP-USD) as opposed to Microsoft Office 2000 Small Business edition priced at $349.95 (MSRP-USD). However, both Microsoft and Corel's top of the line Office Suites are both $449.95 (MSRP-USD), eliminating any price edge Corel may have had at the Professional Office Level. As can be seen from the above graph, both suites perform well given their relative cost.

Figure IV represents Product Cost
versus Service and Support

Corel maintains a slight edge in cost, while maintaining a very respectable support rating. Microsoft's Office support takes the lead with its robust web support, including an office software update page, a heavily production-tested and experienced support system via telephone (albeit 80% outsourced) and onsite support when entirely necessary. Corel offers web support but it pales in comparison to Microsoft's site in terms of content and navigability. Corel's telephone and onsite support offers trained professionals for both on and off site support, none of which is outsourced.

Microsoft's Office 2000 has been shown as the winner, but only beat out Corel's Office 2000 suite by 3.55% in our proprietary software-modeling tool (TESS). However, neither corporate viability nor corporate strategy was compared in this note; had they been Microsoft would have widened their lead by approximately 25%.

Both suites offer a dizzying array of functionality, disparate office suite interoperability and extra's to make almost any desktop user happy. So why should a user go with one over the other? The answer is really quite simple; most users don't have a choice. The majority (60%) of new corporate and consumer based computer systems come pre-installed with Microsoft Office small business edition, negating the need to buy an alternate desktop office suite.

So what about the other 40%? Chances are that over half of those users or corporations will choose Microsoft Office, simply because 'everyone else has it'. Corel is an extremely good desktop office suite, easily rivaling Microsoft's offering; unfortunately for Corel the proliferation of Microsoft's desktop suite has made it the de-facto standard for corporations everywhere.

Due to the current and ongoing proliferation of the Linux O/S, Corel has packaged a Linux version of they're office product. The additional Linux office suite sales for Corel will improve their corporate standings and financial viability, narrowing the gap between the software vendors ever so slightly.

Merant Goes South on the Stock Market

2009-06-20T08:03:00.002-07:00

Shares of Merant, the provider of PVCS, a major software configuration management product (acquired from Intersolv), in addition to other software, have dropped more than 24 percent after the company released preliminary financial estimates for its first fiscal quarter recently-ended, showing revenues likely will be about 17 percent less than the previous year due to a decline in COBOL license fees.

Revenues for the first fiscal quarter are preliminarily estimated to be in the range of $72 million to $73 million, compared to $87.6 million for the same period last year, Merant officials said in a teleconference call and statement. Pre-tax losses for the quarter ended July 31 are estimated to be in the range of $8.5 million to $9.5 million excluding goodwill amortization. The above pre-tax loss range also is estimated before a goodwill charge of roughly $3.3 million.

"COBOL license fees worldwide have declined significantly below expectations and our forecast," said Merant President and Chief Executive Officer Gary Greenfield. He also stated that Merant had originally expected double-digit growth.

Nevertheless, Greenfield said "Egility e-business revenue continues to grow, but didn't accelerate as much as originally anticipated. But operating costs in the first quarter of this fiscal year have declined by more than $10 million as planned, compared with the fourth quarter ended April 30", he added.

Merant officials said they weren't sure of the reasons for the missed projections, though Greenfield said COBOL fees fell "definitely beyond the teens" percentage-wise. He further said another cause might be related to the company's recent reorganization of its sales force. "We intend to continue to thoroughly evaluate the cause for this revenue shortfall while accelerating our e-business transition, and take action to improve execution and return to profitability," he added. Greenfield emphasized that the company is not suffering a cash problem.

Once again, another vendor has stated that growth and license revenues in the mainframe arena are softer than expected (see "System Suppliers Slip Seriously", August 8, 2000 for further details on other vendors in the same boat.)

It is not surprising that COBOL revenues have begun to decline, given the end of the "Y2K" crisis. PVCS has long been a strong candidate for software developers in need of version management and software build control. It will continue to be strong in this space, irrespective of its current stock market woes, although it may become a takeover candidate for a larger firm (i.e., Computer Associates), and should be examined closely at the financial level.

Companies looking at Software Configuration Management tools should include Merant PVCS on a long list of candidates. It is also capable of tracking changes in Oracle's ERP suite, and assesses dependencies and impacts of change, as well as integrating with Tivoli. In addition, PVCS products integrate issue and change management into SCC-compliant IDEs, which allow information interchange between different SCM products, such as Visual Studio and Powerbuilder.

The products in this suite have long been leaders in their field, and should be evaluated by the customer's programmers to determine their fit within the particular environment(s) being considered. The additional consideration should be a financial one, given Merant's current weakness in the stock market. This weakness could potentially be exploited by customers to improve pricing on the products, especially near the end of a quarter or fiscal year.

Mortice Kern Systems Goes Vertical (Sky, that is)

2009-06-20T08:03:00.001-07:00

Mortice Kern Systems (MKS), long known for their expertise in porting UNIX environments (for instance, a Korn Shell (KSH) script or a CGI script) to native Windows NT and Windows 2000, and supporting the full POSIX.2 specification, has expanded into the world of e-business. They have created a new wholly owned subsidiary called Vertical Sky, which is marketing a product called the Vertical Sky Evolution Management Solution�. The vendor believes that it will "provide integrated management of code and content in an e-business". MKS believes that they are the first vendor to enter this space, and that the "new generation of e-business is much more transactional, with many more integrated systems".

According to Randall Howard, MKS chairman and CEO, "Both new and existing customers recognize MKS. The revenue growth of our e-business product line has increased from virtually nothing to the majority of our business and continues to grow and accelerate."

The importance of this effort involves the increasing level of integration between back-end systems and e-commerce front-ends, which is becoming crucial to brick-and-mortar companies attempting to transition to the web or at least leverage it.

MKS recently acquired DataFocus and the SDM Division of Silvon Software to accelerate product development in the software change management arena. Their current customers include Priceline.com, Sentry Insurance, Royal Bank of Canada, and Case Corporation.

Another vendor re-brands itself as an "e-commerce enabler". It seems to TEC that virtually all software vendors are claiming to be in the e-commerce space, and customers should be careful to investigate whether it is a marketing ploy or actual software development.

Mr. Howard believes that the growth in software management products will be as high as $1.6 billion dollars by the year 2003, even though it is considered a mature market. They estimate growth at 24% per year. The move into web content management with Vertical Sky is due to the fact that they expect that market to grow at 83% per year, and match the $1.6 billion number by 2003 also.

Mr. Howard also stated that "In three years I would like to see Vertical Sky as a leading vendor in this new world of e-business management solutions. When that market is literally measured in the billions of dollars, I would like to see Vertical Sky have annual revenues in excess of $250 million by that point."

MKS has a strong presence in the market due to their MKS Toolkit (basically UNIX on Windows NT), and has a strong reputation and awareness among system administrators. If their sales and marketing plan is robust, they should be able to make strong inroads with companies trying to switch from "brick and mortar" to B2B and B2C e-commerce.

Companies evaluating software configuration management solutions should include MKS on the short list. Other companies/products to consider would be Computer Associates Endevor (for the mainframe environment), IBM WebSphere Studio, Merant PVCS, and Microsoft Visual SourceSafe (for a purely Windows environment). There are many other products in this market, and TEC will issue a market note on all of the players in the near future.

Process ERP Market Loses PRISM and Protean

2009-06-20T08:02:00.000-07:00

In early October Wonderware, a division of Invensys, announced to employees and customers that it was significantly cutting the headcount and discontinuing marketing and sales efforts for the PRISM and Protean product lines. These products, part of the acquisition of Marcam Corporation in 1999, address the ERP needs of process companies with the majority of the install base being in the food or chemical business.

From approximately 400 people, Wonderware will cut headcount to fewer than 100 people over the next six to twelve months. Most of the remaining people will be in product support for the PRISM product, which will remain in a maintenance only mode. Wonderware committed to deliver the next scheduled release of Protean (Release 3.2) with a planned delivery of March 2001. However, customers were told that they should not expect further releases of Protean beyond release 3.2. Wonderware has put in place an impressive retention program to insure the required people will remain in place to deliver on the committed 3.2 release of Protean.

Concurrent with internal and customer announcements, Wonderware told the prospective buyers in several active Protean sales cycles that they were withdrawing Protean from further consideration in the marketplace.

Wonderware has told employees and others that they will begin to transition Protean functionality to the Baan product line. Wonderware/Baan has stated that this product, to be called Baan Process, is targeted for 2002. Baan Process is planned to interface with Baan's complementary products such as Baan Supply Chain, Baan Front Office, Baan E-Enterprise, Baan Business Intelligence, Baan Finance, and Baan Procurement. Baan has stated that they will provide a set of tools to help customers migrate from Protean to Baan Process, upon release.

The Baan tool set and discrete manufacturing models were part of the Invensys acquisition of Baan in the spring of 2000.
With the withdrawal of these products from consideration, the market for Process ERP products from vendors dedicated exclusively to that market has shrunk to very few options. This move, combined with the recent financial problems at Ross Systems, means that only SCT of Malvern, PA is left as a healthy Process-only vendor. Several non-process vendors do offer versions of their products that are aimed at the needs of process companies; these include J.D. Edwards, QAD, and SAP.

While the PRISM and Protean products had not been selling well in the marketplace, the large installed base means that vendors with systems that address the needs of the process market will have increased opportunities over the next one to two years.
Process companies who are currently using the PRISM or Protean products from Wonderware should assume that support will continue on a somewhat reduced level for the near term. PRISM users should question Wonderware on the value of on-going maintenance payments. PRISM has proven to be a stable product over recent years, therefore, PRISM users should assume they would not be forced into changing ERP systems. Prudent PRISM users will expand their search for a replacement product beyond that are proposed by Wonderware.

Protean users should assume that their medium to long-term situation is tenuous and should actively evaluate replacement products in the near term. The transition from Protean to Baan Process is an option that should be evaluated as well as alternative products.

Although Wonderware has indicated that they will transition Protean to Baan Process to address the process market, we are reminded that Baan attempted to enter the process market with the same add-on strategy but abandoned the effort for undisclosed reasons. Customers have been told that Wonderware will offer PRISM or Protean customers financial incentives to move to the Baan Process replacement product.

Assuming this product is brought to market on the current schedule of 2002, will it provide an adequate transition path for the existing users? Will the Baan tools, developed in the early 90's provide the technology required today and in tomorrow's environment? Will the approach of adding process functionality to the Baan discrete manufacturing modules prove to be competitive with solutions from process-only vendors or attractive to current PRISM and Protean customers? Users should question Wonderware on their future options and investigate alternative solutions now to fully understand their situation and options.

Process companies considering a new ERP system should be wary of the Wonderware/Baan offerings. They are urged to evaluate from both the process-only (SCT, Ross) and non-process (including J.D. Edwards, QAD, and SAP) ERP providers to determine if these systems fit their specific needs. Special attention is required in looking at both the process and the non-process vendors to ascertain the fit of the product to the unique supply chain and production management needs of the specific process industry and company

SCT Corporation Means (e)Business For Process Manufacturing

2009-06-20T08:01:00.000-07:00

In anticipation of its annual SCT Summit user conference April 8-11, SCT (NASDAQ: SCTC), whose Process Manufacturing and Distribution Solutions Division is a prominent provider of business solutions for the process industries, orchestrated a press release blitz during March.

On March 6, SCT announced an expansion of its vision for its process manufacturing and distribution solutions business. This vision, called "Collaboration in Process," is based on recognition that process manufacturers and distributors will increasingly go to market as members of competing commerce networks. Namely, with the advent of increasing collaboration in supply chains, competition in the manufacturing environment is becoming less about competing products and increasingly more about competing supply chains.

SCT claims its vision extends beyond the traditional supply chain, which is defined by the physical flow of goods, to include the participants who do not directly handle the product but rather handle information, such as exchanges, markets, brokers, and other service providers. This complex relationship network, together with the traditional supply chain network, defines the new paradigm of business - the commerce network. A significant piece of the expansion of iProcess.sct features a relationship network modeling, allowing enterprises to capitalize and collaborate when relationship events occur within or across the commerce network.

To meet its expanded vision, SCT has announced additional products and features that focus on Supply Chain Planning and Optimization, Internet Commerce, and Relationship Management. To that end, on March 20, SCT announced the newest components of the iProcess.sct solution, delivering additional e-CRM capabilities.

The iProcess.sct suite includes advanced planning, demand planning, and advanced scheduling, and with planned expansion to include transportation planning and replenishment planning with support for Collaborative Planning, Forecasting and Replenishment (CPFR) and vendor-managed inventory (VMI). SCT's iProcess.sct also includes sell-side e-commerce and eCRM solutions, with planned expansion to include interactive customer service capability, and access to e-commerce applications via wireless technology.

Central to SCT's product announcements are Interactive Customer Assistance components of iProcess.sct. These will enable real-time customer interaction through SCT's sell-side Internet commerce solution. Using these solutions, SCT claims that enterprises can extend Internet commerce applications with live on-line communications and call-center capabilities. Functionality includes instant messaging, live chat, e-mail, and real-time "follow-me browsing," which enable a customer service representative to remotely guide a customer through the on-line sales process. Trading partners can choose how and when they will do business with each other, whether it be through a website, over the phone, or a handheld or personal digital assistant (PDA). Wireless business activities include placing or checking orders, inquiring on goods available, and looking up quality specifications on newly arriving shipments.

On March 19, SCT also announced a partnership with IBM that combines the iProcess.sct solution with IBM e-business solutions. As part of the relationship, SCT will offer iProcess.sct with IBM's financing, hardware, software and service solutions. With the relationship, SCT embraces key IBM technologies, such as IBM WebSphere* software, MQSeries,* and the DB2* Universal Database. SCT also embraces multiple leading IBM platforms, including the new IBM eServer* pSeries and xSeries systems.

While the new vision focuses primarily on expansion in the aforementioned areas, SCT will continue to offer its Supply Chain Execution/ERP products to the market along with continued upgrades and additional applications for warehouse management and trade funds.
With these announcements, SCT raises the ante for e-commerce within the process manufacturing space. The expanded vision addresses the marketplace realities of its process manufacturing segment. Most of these markets live with the reality of very slim margins. To compete, these companies must continue to reduce their cost while increasing the level of service to their customers. The time-to-market for these companies is often constrained by the idiosyncrasies of handling natural resources (e.g., seasonality and perishability). For these companies, however, the speed of communications promised by the Internet has evolved into a new era of competitiveness that is not that typical within the discrete manufacturing sector.

As industry expert Bill Friend, ex-VP of IT and Logistics for Simplot states, "Competition within the process industries can no longer be based upon price and quality, these are givens. Competition must move to increased levels of service. Process companies must wrap their products in information to better serve the total needs of their trading partners."

Incumbent process manufacturing vendors will have to assess their offerings relative to iProcess.sct to counteract the impact of this expansion in functionality. Since most of them are currently in a tight spot with dwindling resources, this need may only rub salt into their wounds. Vendors that have a broader focus than the pure process manufacturing but that also compete in the space need to more deeply grasp the inherent process market peculiarities versus the advantages of offering perhaps broader but less focused solutions.

While the above strategic moves are a step in the right direction, SCT has yet to adequately address the buy side of its e-business applications, namely, the area of e-procurement. While SCT has formed a partnership with ecFood.com, a leading food ingredient exchange, as part of their buy side e-business efforts, it has not yet provided similar offerings for the remaining segments of its focus (e.g., chemical, life sciences, etc.). Some competitors like Infinium, can tout both vertically focused e-procurement and integrated CRM solutions. Look for SCT's remedial actions in that regard.
Existing SCT customers should consider these announcements as central to their e-commerce plans, although informing themselves about other vendors' offerings would be beneficial. Process manufacturing enterprises from the above mentioned industries that are looking for e-commerce or other enterprise solutions should place SCT on their initial list of prospective vendors. Potential and existing users should be aware of the fact that it is a long journey from vision to execution. Therefore, prod SCT executives about firmer product availability dates and bear in mind typical issues associated with immature product releases.

How Great Is Great Plains' Manufacturing Offering (Did Somebody Say Microsoft)?

2009-06-20T07:59:00.000-07:00

Great Plains is a leading small-to-mid-market provider of back-office and e-business solutions. In March 2001, the company (still an independent entity at the time) held Convergence, a four-day annual user conference and international business event for its customers.

Although not given much attention at Convergence, Great Plains' foray into the discrete manufacturing market caught TEC's attention. While the company is admittedly aware of its limited success and brand recognition in this market segment, partly the result of arriving late in the game (eEnterprise Manufacturing Series was released only at the end of 1998; the product was previously developed within Great Plains' development environment by Great Plains' former VAR ICONtrol, which the company acquired in April 1998), it is poised to significantly improve its posture and product offering. See Market Impact for our view of Great Plains' odds of success with this endeavor.
This was the fifth Convergence for Great Plains Dynamics and eEnterprise customers, and the first for Great Plains Solomon customers. In September 2000, Great Plains unveiled new e-business solutions and services during its 15th annual Stampede, a four-day international business conference for Great Plains value added resellers (VARs), consultants and solution developers. These constituents sell, support and develop integrated products for Great Plains e-business solutions, (for more information, see Great Plains' Latest Product Offering - Ready to Stampede the SME Market?).

During Convergence users had their turn to preview such new applications as release 6.0 of eEnterprise, although most applications has already been showcased at Stampede. Release 6.0 of eEnterprise is the most comprehensive release in the company's history, with significant new multinational and international enhancements. Still, Convergence featured such recent events as the availability of a time-tracking solution for hand held computing devices.

Other recent announcements included Great Plains' strategic alliance with Concur Technologies Inc. (NASDAQ: CNQR), a provider of Corporate Expense Management solutions, to resell the Application Service Provider (ASP) model for Concur Expense�. Concur Expense is a Web-based travel and entertainment (T&E) expense management solution that will be resold by Great Plains' 2,000 Value Added Resellers (VARs) to middle market companies and existing Great Plains Dynamics, eEnterprise, Solomon IV and Classic customers.

Also noted was Great Plains' announcement of plans to add a web-based budgeting solution to meet the budgeting, planning and collaboration needs of mid-market organizations. FRx Software, a wholly owned subsidiary of Great Plains, will acquire the new budgeting solution, ebudgets, and will re-brand it as FRx� Forecaster�. The integration of FRx Forecaster with FRx's financial reporting application will automate operational expense, personnel, capital and revenue planning and allows multiple users and locations to participate directly in the budgeting process via the Internet, a corporate intranet or a LAN-based network. FRx Forecaster Professional will be available to Great Plains eEnterprise and Solomon IV Premier customers in the second calendar quarter of 2001.

Despite the organizers' attempt to focus on 'business as usual', it was inevitable that the audience's interest was in the status of Great Plains assimilation by Microsoft (see Microsoft And Great Plains - A Friendship That Turned Into A Marriage). The acquisition was formally completed with Microsoft's April 5, 2001. announcement.

"Contentment without complacency" was TEC's impression that Great Plains exuded during the conference with regard to becoming a part of Microsoft. While relying on Microsoft's immense R&D resources (five times bigger than the value of Great Plains' acquisition) is certainly pleasing, it would not suffice in the long run without Great Plains' tenets of success in the past, e.g., focus, product quality, channel, etc. Cannibalizing the business of Great Plains' direct competitors that are still Microsoft's partners is not an option - Microsoft has to be wary of being anti-competitive, given the DOJ's constant attention to its moves. Therefore, Great Plains continuation of business as usual is quite plausible.

Selecting and attracting renowned vendors as its partners and integrating disparate products have marked Great Plains' strategy in the past. Great Plains has impressively delivered on its projection from almost two years ago when it indicated that front-office applications (through the alliance with Siebel Systems) and e-commerce were two strategic areas of focus for the future. The company has even gone a mile further by putting together a comprehensive product offering that includes supply chain management (through the alliance with Logility). Consequently, Great Plains has indeed made great noise and established itself as a global small-to-medium enterprises (SME) market leader. This is not the case in the manufacturing part of the segment, but the company is determined to change its posture in that regard.

The first and foremost reason for maintaining a higher profile is finally having a real product with tried-and-true functionality. The eEnterprise Manufacturing Series provides a broad suite of applications designed for discrete manufacturing businesses with Make To Stock (MTS), Make To Order (MTO), Assemble to Order (ATO) and Hybrid manufacturing environments. It features the following traditional ERP Modules:

Manufacturing Orders	Quoting/Estimating
Capacity Requirements Planning (CRP)	Work Center Definition
Sales Forecasting, Inventory Management	Routings
Quality Assurance	Material Requirements Planning (MRP)
Master Production Scheduling (MPS)	Engineering Change Management (ECM)
Bill of Materials	Work in Process (with Lot/Serial Control and Data Collection)
Job Costing	Sales Configuration

The Manufacturing Series integrates with other typical ERP functional series available from Great Plains such as the Distribution Series, the Financial Series and eEnterprise Payroll. The tight integration with HR, FRx enterprise reporting, e-commerce and Siebel CRM modules, and with Logility Supply Chain Planning modules (still in the future) will render the product even more attractive to the target market segment.

The customer base is also getting to a critical mass, although it still has to grow. The company cites approximately 160 manufacturing installations, almost exclusively in the discrete manufacturing spot, with a small number of batch process manufacturers. Although the company cites targeting the companies with up to $250million in revenues, the real sweet spot is the manufacturing companies with $10million - $75million preferably with a single location. The customers are currently only North America-based owing to Great Plains' endeavor to get all its ducks in a row before releasing products for wide spread availability. The global availability is expected within a year.

Since its competitors, particularly the larger ones, may with good reason object that they had delivered the above product features a way back, the differentiator for this Great Plains' endeavor (and proven success) is to deliver bulletproof, bug free new generally available (GA) product releases, based on stringent product functionality and performance testing. That has not traditionally been the rule for most bigger applications vendors, whose new releases are often bug ridden. The market where Great Plains is competing is quite unforgiving to these kinds of flaws, possibly more so than with the vendor candidly admitting the missing functionality.

What should also bode well for the campaign is Great Plains' possibly unrivaled global indirect channel model that consists of over 2,200 partners; it has been admired industry-wide as the most appropriate delivery business model in the target market segment. Further bolstering its channel is the company's endorsement of the Application Service Provider (ASP) model, which it started more than two years ago (For more information, see Great Plains ASP - Evolution, Revolution, Innovation). Moreover, the speed and low price, as well as the low hardware requirements may cause the prospect to overlook the bells and whistles of other competitors.

Implications For The Future : Nevertheless, Great Plains will have its work cut out for it. The product still lacks in some functionality that TEC noticed as increasingly required during recent software selections engagements such as lean/flow manufacturing, intuitive visual (graphical) finite scheduling/plant level execution, plant maintenance, document management/PDM, etc. The product also lacks strong distribution requirements planning (DRP) functionality, which still renders the product not particularly suitable for multi-site implementations. There is also lack of vertical focus and industry templates - the fact that the majority of customers are electronic manufacturers/OEMs is more the result of serendipity than the company's orchestrated effort in the industry.

To that end, during our attendance at Convergence, TEC was made aware that some alliance negotiations were in progress, and the market should expect related press releases in the near future. While belonging to the Microsoft family has advantages, the downside is that Great Plains' intended initiatives would likely be hampered and tied to the strategy of the bigger brother. The request for expanding the functionality of Microsoft bCentral small business service may push aside some other initiatives that Great Plains had earlier deemed necessary. Before integrating with Microsoft bCentral can happen, in turn, Great Plains' stable of products has to be re-architected/re-written for .NET as opposed to any proprietary development tools (e.g., Dexterity). And only then, when all the products are interchangeable, eEnterprise will be able to benefit from using the Solomon IV superior distribution or project management functionality and vice versa. This is not going to happen any time soon.

Any protracted delay in articulating and delivering these initiatives would aggravate the challenge of protecting Great Plains turf from such Tier 1 and Tier 2 intruders as SAP, Oracle, J.D. Edwards and PeopleSoft that indisputably have a more comprehensive and deep offering. The threat will remain even if the Tier 1 vendors' offering is toned down for the smaller market segment (see SAP Claims Big Gains In The Low-End Battleground and PeopleSoft Joins The Hunt For SMEs). One should also not overlook the fierce competition from direct competitors like NavisionDamgaard, Epicor, PRONTO, and Lilly Software to name but a few. These players can still tout their superior native manufacturing and distribution functionality and vertical focus, which are indisputably ever more important tenets of competitiveness within the SME market.

As a summary, Great Plains has most of what it takes to be a strong competitor - product, channel, implementation methodology, market focus and corporate viability. There is still much room for improvement in expanding the functionality and the market awareness; with Microsoft's wind in its sails, one should look for more effervescent activities in these matters.

As for potential Great Plains discrete manufacturing users our advice would be:

Evaluate eEnterprise if you are a small to medium, North American single-site discrete manufacturing company or division, with a limited IT budget and a timid IT strategy.
Bear in mind that if the non-manufacturing modules (e.g., HR/payroll, CRM, e-commerce, etc.) are also critical to you, then Great Plains brings added value to the table, although the integration should be validated during the technical review sessions as a part of a thorough selection process.
Companies that require complex engineer to order (ETO) functionality, multi-site and/or more intricate multi-national capability may benefit from evaluating other offerings.
During the selection process, question the company's executives about the positioning of its manufacturing offering within the total business strategy of Great Plains/Microsoft.
Talk to or visit existing users with a profile similar to yours to assess their past experiences and confidence in the future of Great Plains' manufacturing product and its track record relative to meeting the industry needs.

Analyst / SCT Share Vision at SCT User Conference

2009-06-20T07:58:00.000-07:00

The SCT User Conference, held in Toronto featured industry analysts from Gartner Group, AMR Research and Meta Group each sharing their vision for the future of enterprise systems with the audience. Customers, in special interest groups and in presentations discussed their success with SCT's products. SCT showed both their existing product set plus their vision for the future with a series of product announcements and prototypes of future products.

For the opening session of each day's conference, SCT invited key industry analysts to present their vision of the future of enterprise systems. This gave the SCT customers a view of the future from the point of view of the analyst. Each focused on a different aspect of systems, with the overall message blending to give a comprehensive picture of what will be required to compete in the not so distant future. The key message was collaboration with trading partners and how the ERP market and vendors will evolve to meet these challenges.

SCT concurred with the collaboration message, painting a picture of its vision of the future for process companies with a series of collaboration announcements. For example, the iOrder product is being enhanced to permit live, interactive customer assistance. Central to the SCT vision is further evolution of its component vision that allows its products to co-exist with products from other vendors. All three analysts voiced an endorsement of SCT's direction.

A prototype of SCT's upcoming entry into relationship network management revealed a partner network modeling capability that is absent from alternative products. More importantly, the approach allows the modeling of the complex, multi-tiered relationships faced by many of the companies in SCT's target markets, for example food and CPG. These relationships include distributors, brokers, agents, channel partners, logistics providers and retailers. The product in question will be later this year.

An array of customers presented their experience with SCT products, including Coca Cola, Safeway, Miller Brewing, Cargill, Basic American Foods and others. These presentations covered ERP, SCM and e-business success stories. Some customers use the entire SCT product suite, but many use portions, coexisting with other solutions. For example, SCT has shown success with integrating its SCM products with the SAP backbone.

For example, Coca Cola uses SAP for many functions and SCT's iProcess.sct Supply Chain Planning (the product "Fygir") for supply chain management within its fountain syrup business unit. In a series of sessions, Coca Cola presented how they manage the fountain syrup business' complex, worldwide, multi-plant supply chain with Fygir. At headquarters, Coca Cola does multi-plant strategic sourcing, production, capacity and distribution decisions. At each plant, optimal production sequences are determined considering production constraints, operational efficiencies, manufacturing preferences, run rates, change over/setup times, as well as labor and space utilization.

Cargill Latin America discussed the management of multiple business units in grains, flour, oils, citrus and other agricultural areas. The complexity of its management challenges included dynamic freight rates, grain elevator movements, variable quality, customer blending requirements, etc. Cargill uses the Fygir product and claimed significant gains.

A presentation by New Balance Shoes on its success in forecasting, production, and capacity planning was especially interesting given the recent press on competitor Nike's difficulties in a similar area. The New Balance presentation demonstrated key functional elements required for success by the consumer packaged goods company.
The customer speakers demonstrate that SCT continues to show great customer success. However, the company is not fully exploiting its name brand customers to its marketing benefit.

Special Interest Groups by company type (food, chemical, etc.) and functional area (supply chain, etc.) allowed customers and SCT field and product management to share experiences. The tone of these sessions revealed that the user community is attacking in-depth business issues and getting results. The users also identified additional requirements that remain to be addressed. For example, the CPG and food customers need additional functionality from SCT to deal with deals, promotions and the associated collection issues.

The user conference points out a consistent problem with SCT's marketing. The conference combined all SCT divisions (education, government plus process manufacturing) and therefore, the messages became very confusing. Under the SCT approach of lumping together all its business segments under one name, user conference, etc, each suffers in the competition for mind share within its individual target market.

The "Old ERP" Dilemma: Replace or Add-on

2009-06-20T07:56:00.000-07:00

The four part series titled "Where is ERP Headed (Or Better, Where Should It Be Headed?)" introduces a number of key issues about the future. But everyone starts his or her individual journey to the future from somewhere - the place they are today. If the place you are today is with an "old ERP" system, many questions exist about how to get to the future.

First, what is an old ERP system? If your system has green screens, you have an old ERP system. If your system has a GUI (Graphical User Interface) but not something that looks like most Windows applications, you have an old ERP system. If the system was introduced in the 80's, you have an old ERP system. If your vendor is no longer enhancing the system in "new areas", you have an old ERP system. If your vendor is becoming a "have not" of the ERP industry, maybe old age is approaching.

If you have an old ERP system and you need some of the business functionality offered by Supply Chain Planning (SCP), Business Intelligence (BI), Customer Resource Management (CRM), New Product Development (NPD) or e-commerce � you have a dilemma. Do you replace what you have first and then add these new functions or do you keep what you have and add these functions around your existing ERP system? Every vendor of ERP or any of the functions listed above will have advice for you. But you can rest assured the advice is what is best for the vendor in almost every case. (To be sure, there are some conscientious sales reps out there that will give you honest advice.)

The Realities of Replacement : Why are you thinking about getting rid of your existing ERP system? What ever your answers, they must be compared to some of the realities of replacing the old system. Those realities include cost and time, but these two issues go much deeper. You have to pay the cost of buying and installing a replacement ERP system. You have to suffer the cost of disruption, typically a dip in operational efficiency and effectiveness, before, during and after the implementation. You will have to suffer the pain of ripping out the existing system and putting in its replacement. Will the replacement of the existing system be more or less painful that what you experienced the first time? This is a good question, which has no standard answer.

Once the replacement system is installed, will it give you adequate ROI on the replacement investment? The time involved in implementing the replacement ERP system means that the ROI on the added function you are seeking is delayed. Yes, you could try to implement both the replacement ERP system and your shiny new SCP or e-commerce system at the same time, but are you willing to accept the risk and even greater disruption in doing so. The "big bang" horror stories of the late 90's should make you very adverse to this approach.

An ERP system is the backbone of your operations. You need to make absolutely certain that any replacement system functions as well as or better than what you have. The word old means mature. Will the replacement system offer all the function that your old, mature system has today? Your people may not like the existing ERP, but they know it. Can you guarantee that the new system will really be an improvement for these people? Maybe the most important thing that can be said about the old system, which may not be true of the replacement system is, "It works!"

If you are looking for a replacement ERP system as a way to get to some of the newer functions like BI, SCP or NPD, you need to pick a system that is both better than your existing ERP system and provides the best functionality in the new areas you are seeking. You will have to pick a single vendor who is up to both tasks. Although the offerings from the integrated ERP vendors have improved to the level of functionality of the best of breed vendors specializing in a single area for many situations, the exact function you want and the specifics of your industry may mean that the integrated vendor is not up to the challenge.
Why Are You Replacing Your Existing ERP System?: So, why are you thinking about getting rid of your existing ERP system? If the answer is simply your need for some of these newer and more advanced applications, you have not thought through your options - you can reach these objectives with or without replacing your existing system.

If the answers have to do with technology, you need to look deeper. A CIO recently told me that he was going to replace his old ERP system because, "My users think it is old and ugly." Unhappy users are always an issue. How much you weigh this issue versus the cost, time and disruption issues is part of the trade-offs involved in making this decision.

Maybe the existing technology itself is old and ugly. If the underlying hardware and systems software is creating frequent disruptions or have become very expensive to maintain, you have another issue to trade-off. But if the existing hardware or systems software puts you at risk of a lengthy or permanent disruption of service, you have no choice but to go to a replacement system.
The Realities of Additions :

Why would you add the new function around your existing ERP system? If you add the function you require on to the existing system, you should get the benefits you seek faster. You can proceed directly to implementing the functions that will deliver the ROI. That project will have to include some consideration of integration of the new function to the existing ERP system, but the overall schedule is typically shorter.

In many cases, the functionality provided by a specialist or best of breed vendor will be better than that offered by many integrated vendors. As the above-mentioned article discusses, the future of ERP means sharper vertical focus. For many industries or verticals, significant operational advantage can be gained by going with a vendor who focuses in their industry. The best of these focused vendors typically limit their target market to a few, closely related industries. Note, industry focus means application function, not industry specific brochures.

Additions Involve Integration : But what is the true cost of going the best of breed route? Integration is one of the answers. It is not free. It is another issue that must be traded off. The reality is that the integrated vendor should have better integration and they will bear the cost of maintaining that integration. This is almost always true if the vendor wrote all the pieces themselves. If they acquired some or all of the pieces, this should be true, but you should test the vendor's commitments in this area. If the components come from a "strategic partnership", it means that as long as the relationship makes money for both parties and they do not evolve into a competitive situation, the integration will continue to exist.

Part of the integration trade-off has to do with the quality of the integration. A single vendor, integrated solution should have better integration. The question for the best of breed option is, "Can these products be integrated in a practical way." Practical does not mean best, it means acceptable given all the other trade-offs that will always have to be made. You will have to live with extra code, the integration code that needs maintenance. You will have to live with duplicate files that may get out of synch. You will be the one who deals with the finger pointing between the two vendors when one or both of the two systems are not working correctly. You will have to deal with the new release cycles that will prove to be always perfectly out of synch.

The selection of an add-on product must include the ability of the product to integrate with the existing systems. Was it built to be integrated? What integration technology does it support? What will be the cost and risk of maintaining the integration?

ecFood Approaches Profitability - An Internet Trading Exchange Bright Spot

2009-06-20T07:55:00.000-07:00

ecFood (www.ecFood.com) has announced $50 million in transactions for the first quarter of 2001. The quarter's volume continues the upward trend set over the past three quarters. The end of the first quarter also saw the first year's anniversary of providing paid online services to the food and beverage industry. ecFood's highly focused customer base of buyers and sellers continues to grow as the company sees profitability by the end of 2001. ecFood provides web-based sourcing for the food and beverage industry.

The company's roots are deep in the food industry. The majority of the company's personnel have strong food industry backgrounds. This experience shows in a number of ecFood's offerings that reflect the realities of sourcing in the food and beverage industry.

A key food industry specific offering is ecSpec, the company's specification management solution. With ecSpec, a buyer can fully define the specifications for the items to be purchased and the seller can fully understand the needs of the customer. At the core of ecSpec is a series of food industry specific tools including specification templates, industry standard terminology and ontology, and key word based or parametric searches.

The company provides several buying e-sourcing options including reverse auctions, Request for Quote (RFQ) and one-to-one negotiation tools in a Demand Aggregation or individual format. These buying options are backed by professional services that include Market analysis, Item profiling, Sourcing configuration, SKU rationalization and Supplier recruitment. A combination of professional services and tools provide the purchaser with work flow to move from their current state to one of being ready to utilize web-based sourcing. The workflow assists the purchaser in selecting appropriate SKU's and preparing item specifications that identify volumes, locations and order patterns through the purchasing process including the setting of and evaluation of goals and measurements.

e-sourcing permits the food company to conduct Internet-based auctions for its purchases. Recent items purchased using e-sourcing included pasta, corn syrup, stretch wrap, liquid sucrose, apple juice, pallets, and diesel fuel. A recent auction for 1.2 million pounds of rice resulted in a savings of 12.3% for one SKU and 10.8% on a second SKU. An auction for navy and pinto beans resulted in bids from 10 suppliers over a half hour bid period and resulted in savings of 15%. Discussions with sellers indicate that they are reaching customers who would be unavailable to them without the use of ecSourcing. Buyers using e-sourcing have included Bordens, HP Hood, Hormel, Interstate Brands, Agrilink and Furman Foods.

Demand Aggregation allows multiple buyers to combine their demand to gain better terms with suppliers. The associated buyers could be an industry group, existing buying group or an ad hoc group assembled by ecFood. Demand Aggregation opportunities scheduled in the near future include beef trim, butter, cheese, chicken meat, carton tape, pallets, labels, transportation and others.

A recent Demand Aggregation agreement was created with The Coca-Cola Bottlers' Association (CCBA), an independent trade association serving participating member Coca-Cola Bottlers in the United States. CCBA will use ecFood as part of its cooperative purchasing programs. Under the agreement ecFood, will provide a full range of e-procurement software and services including sourcing, supplier rating, negotiated bidding and specification management. The initial efforts included both ingredients and MRO items.

The buyer benefits of web-bases sourcing continue to be documented in most industries. The unique needs of the highly competitive food and beverage industry have meant that these benefits have been slow in developing for these companies. As food industry specific functionality becomes available, food companies are proving that the benefits shown in other industries are achievable in the food and beverage industry.

As the number of dot coms dwindles, we see some examples of highly focused exchanges with growth and a path towards profitability. ecFood is an example of one such exchange. A number of other food industry specific sites have fallen by the wayside plus the general-purpose sites (for example, ICG and Freemarkets) have found the needs of the food and beverage market a significant challenge.

The food and CPG consortium, Transora, offers a wide variety of services to the food and beverage industry. These services include some web-based sourcing. As of today, the sourcing tools and services available from ecFood have progressed beyond those foreseen by Transora.

Web-based sourcing is a new tool that extends the efforts of the food and beverage company's existing procurement efforts. All food and beverage companies should evaluate web-based sourcing to lower their cost and improve the quality of their purchasing operations.

Mid-sized food and beverage companies should be especially attracted to these approaches. Large food and beverage companies typically get the lowest price available due to greater volume and market visibility. These large companies can also afford to invest in private exchanges. Web-based sourcing has proven to provide the mid-sized company with these same benefits at a fraction of the cost.

Transora members should evaluate ecFood as an alternative to the sourcing options planned by Transora. At minimum, ecFood should be evaluated as a short term cost reduction effort and a learning experience in the new world of web-based sourcing.

ecFood should continue its focused approach to the food and beverage industry and its focus on profitability. It should increase its market awareness efforts to become a better know name within its target market.

Identifying the ROI of a Software Application for SCM

2009-06-20T07:54:00.000-07:00

The competitive environment for every industry grows increasingly intense. Fast, reasonably accurate information about the impact of a software investment decision grows more critical. Many decision-makers look for an exact forecast of return on investment (ROI) from the purchase of a supply chain management application. At least four very real challenges make such perfect information elusive. Commonly, executives meet these challenges with responses that are not carefully considered. The challenges and the corresponding reactionary refrains are as follows:

Limited time exists to perform analysis - "We need to know now!"
Business analysis skills are lacking - "We are looking for the vendor to tell us!"
The data to perform the analysis are almost always not available in the corporate databases - "We have tons of data, but we don't have it broken down like that."
It is always difficult to predict the future … like forecasting, certain laws about a prediction of ROI will forever hold true…
- the prediction will always be wrong
- the prediction will always change for as long as the analysis continues
- someone is going to be held accountable for the prediction
- "Just give us the bottom line!"

The reactions of some decision-makers to each of the four challenges that are listed above provide a convenient outline for exploring a more thoughtful and strategic approach to evaluating a potential investment in supply chain management software.

Part 2. "We are looking for the vendor to tell us!":

After all, the software vendor is proposing the solution, shouldn't the vendor know how it will affect your company? The vendor probably does have some useful information about whether the decision to purchase will be of some benefit. They will be able to tell you what business symptoms can be affected. They may even have survey data that show how other companies in your industry, or at least in other industries, have reported benefits. They should have anecdotal evidence of how some existing customer plans to benefit or has benefited from investing in their application.

There are a couple of problems with the vendor's input. First, the vendor cannot be objective. The vendor's business is on the line. It is probably a fierce competitor and its representatives may be under pressure to make this deal happen. Second, directional information, surveys, and anecdotes may or may not be reasonable predictors of how your company will fare. The current state of your business processes and how they are performing is pivotal to the potential return.

This reaction "We are looking for the vendor to tell us", is similar to the first "We need to know now", but less driven by time than by the perception that the skill to perform the cause and effect analysis, data gathering, and statistical analysis does not reside within the company. While that may be the case, it is important for you to be able to understand, monitor and control the process, even if you use an outside consultant. Following these steps will help you do just that:

Identify and quantify undesirable symptoms.
Perform cause and effect analysis to find possible root causes.
Gather data by reason code (in order to prioritize root causes).
Quantify and analyze root causes (Pareto analysis).
Estimate the positive impact of your investment decision (e.g. a new supply chain management package) on your root causes.
Extrapolate this to the positive impact on the undesirable symptoms.
Perform sensitivity analysis around your estimate in step 5 by varying the estimate and repeating step 6. This will give you a sense for the range of possible outcomes that is reasonable.

Your success at steps 1 through 7 will be most likely if you follow two additional guidelines:

"Time box" the analysis to a minimum of 3 weeks and a maximum of 45 days. These time frames are really only a guide to represent the order of magnitude for the minimum and maximum time frames.
Assign a full-time resource for each area of analysis you undertake.

Identifying the ROI of a Software Application for SCM

2009-06-20T07:51:00.000-07:00

Part 1: We Need To Know Now:

Limited time exists to perform analysis - "We need to know now!"
Business analysis skills are lacking - "We are looking for the vendor to tell us!"
The data to perform the analysis are almost always not available in the corporate databases - "We have tons of data, but we don't have it broken down like that."
It is always difficult to predict the future … like forecasting, certain laws about a prediction of ROI will forever hold true…
- the prediction will always be wrong
- the prediction will always change for as long as the analysis continues
- someone is going to be held accountable for the prediction
- "Just give us the bottom line!"

After a quick look at these issues, one might question the effort to undertake the analysis to predict an ROI, as well as the validity of the outcome. Perfect, or even complete, information may not be feasible, but if a few basic principles are followed, some analytical work can provide an understanding of the potential for bottom line impact. It can also yield insight into the root causes of undesirable symptoms from which your business may be suffering.

About This Note: This is a four part note, each part addressing one of the four challenges. Part Four contains links to the prior parts.

Part 1. "We need to know now!" :

Managers must make quality decisions with increasing velocity. The tools that support detailed analysis have gone a long way toward making more informed decisions a reality. It is usually true that the incremental benefit of additional information decreases as one moves along the continuum from no information toward the goal of perfect information about the future. However, it is also true that you will reap significant benefit from knowing with some certainty what you can do in a 2-6 week period. So the idea of a bit of rigorous analysis should not be shortchanged.

If you truly do need to know something with immediacy, here are some tips for a quick, cursory approach to identifying the potential return from an investment in several aspects of supply chain management software.

Collaborative Product Design :

Compare your company with key competitors along these lines:

Are your competitors leading with new products and gaining market share?
If competitors are leading, is that hurting your sales?
When your company leads with new features, are they quickly copied and surpassed by competitors?
When a new product is released for production, is it plagued by numerous engineering change orders?
Do suppliers have trouble meeting quality specifications?

If the answer to one or more of these questions is yes, then you probably have some opportunity to reduce costs and increase the rate and quality of innovation through a collaborative design process within your enterprise, as well as among you, your suppliers, and your customers.

Collaborative Forecasting and Planning :

If you track the accuracy of your forecasts, then you have some idea whether or not your company anticipates marketplace requirements well. However, you must look beyond the aggregate annual revenue projection. To understand the impact of demand planning on operations, it must be examined at a level that can be executed. In other words, are you accurately anticipating the requirements for parts, people and processing at a fairly detailed level? If significant forecast misses regularly occur, then working together with your major customers to plan for demand may have a notable impact on your operating costs.

Your suppliers may levy additional charges because you have passed on abrupt corrections in your demand for their products and services as a response to changes in your own demand profile. These additional charges derive from additional setups, work-in-process inventory, and lost material incurred by the vendor on your behalf. If the structure of your industry prohibits suppliers with less bargaining power from passing on these charges, they are still no less real a cost. Everywhere that the supply chain generates unnecessary costs, a savings opportunity exists for the members of the supply chain. In this case, such savings can be acquired by extending the collaborative planning loop to include not only your customers, but also your suppliers.

Optimized Manufacturing Planning :

Optimized manufacturing planning entails the use of linear programming to choose the least cost combination of plant, equipment, personnel, and material that will meet planning objectives that may include one or more of the following examples:

Maximizing inventory turns
Maximizing on-time delivery
Maximizing revenue
Maximizing profit
Maximizing throughput

Because optimized manufacturing planning provides decision support that considers multiple tradeoffs and constraints, it may not be easy to point to one indicator that demonstrates the potential for improvement through implementation of this powerful technique. However, clues can be found in your manufacturing cost variances, and in your performance against the business metrics that corresponds with the objectives you want to maximize.

Inventory Planning and Optimization :

Look at your financial reports and make a judgment as to whether your balance sheet or your income statement will be positively affected by the decision. For example, examine inventory levels relative to your revenue. Calculate inventory turns by dividing revenue by the annual ending (or better yet, 12-month average) inventory. Compare your turns with your competitors. If that information is not available, you can use a general industry measure that is publicly available from Standard & Poors or other sources. The higher the turns, the more working capital you have to invest elsewhere and/or the less total interest you pay the bank for the working capital that you borrow.

Gauge your company's interest expense. If turns are low and interest expense seems high, then you probably have some significant room for improvement in the way that you make decisions about acquiring and producing inventory.

Does your company keep a financial reserve account against inventory assets (a contra account)? Does the proportion of your inventory that may have to be written down at the end of the year indicate that your company is making enough of the right decisions around purchasing, distribution and manufacturing? If the reserve account seems high, that underscores the importance of having the right inventory at the right time in the right place. It means that obsolescence is becoming an issue because your planning process is not keeping pace with the volatility or lead-time of demand.

Synchronized Planning and Scheduling :

Does your company pay the freight for the product or do your customers pay it? Perhaps it varies by customer. It may be that you are paying a significant amount of premium freight in order to meet customers' demand. If the premium freight you have paid each month for the last several months is anything but negligible, there may be an opportunity to eliminate most of that expense through tools that facilitate synchronized planning and fast planning cycles.

Take a walk through the plant. Do you see a lot of inventory that is partially completed? Are there piles of work-in-process inventory that are not being rapidly used up, either on the shop floor, or in the warehouse? That is an indication of a planning problem. It may be that the distribution, purchasing and scheduling requirements are not synchronized. Or, perhaps there are bottlenecks that the plant manager can not deal with systematically because he does not have the right tools. There could also be significant setup times that can be eliminated with more sophisticated planning algorithms.

Accurate Order Promising :

Tally up the amount of charge backs you have received from customers in the last 12 months for late delivery. If you are consistently getting charge backs for late deliveries or short orders, that is another area of cost savings that may be available to you. Accurate order promising that considers your real capabilities might eliminate a portion of those charges.

The sales force may also have a feel for orders that they lose because they cannot accurately commit to customers in real time. An application that provides that capability might yield a competitive advantage.

Transportation Planning:

There may be savings available through transportation planning. If you have any significant level of less-than-truckload shipments, you may be paying too much for freight. The challenge of determining the least cost route when many alternative groupings of multiple stops into routes must be considered requires the rapid use of advanced mathematics and/or algorithms to be sure of an optimal or near optimal solution.

If most of your shipments are to consumers, almost every pair of order lines that ship separately to a customer within a given 24-hour period is an opportunity for improvement through co-packing.

Statistical Process Control :

Another place to look is in the area of returns. Unless you are an electronic retailer or a mail order house, returns should not be a significant cost of doing business. How are they trending? Then talk to manufacturing, distribution, customer service, or all three, and you will get an understanding of how often things come back and why. You may find an indication of a quality problem in manufacturing, packaging or distribution processes (shipping and handling, or possibly sortation).

This concludes Part One of a four part note.

Identifying the ROI of a Software Application for SCM

2009-06-20T07:48:00.000-07:00

Part 3: Performing the Data Analysis:

Limited time exists to perform analysis - "We need to know now!"
Business analysis skills are lacking - "We are looking for the vendor to tell us!"
The data to perform the analysis are almost always not available in the corporate databases - "We have tons of data, but we don't have it broken down like that."
It is always difficult to predict the future … like forecasting, certain laws about a prediction of ROI will forever hold true…
- the prediction will always be wrong
- the prediction will always change for as long as the analysis continues
- someone is going to be held accountable for the prediction
- "Just give us the bottom line!"

Part 3. "We have tons of data, but it is not telling us what we need to know." :

Performing the Data Analysis

If the data exist, you need to trace a symptom, like excess work-in-process (WIP) inventory, to the root cause such as forecast error that drove production of the wrong product. Once that is done, then powerful, but relatively simple analysis can be performed by collecting the data from the data warehouse, or wherever it is stored, by putting it into a spreadsheet and then creating a cumulative distribution (see Figure 1) of the symptom by reason code.

Figure 1.

More commonly, however, the data cannot be readily segmented by root cause. This is probably because the symptoms and the root causes have not been identified and linked. Using a simple fishbone diagram (see Figure 2), a few folks who know the business processes involved can probably identify symptoms and trace them to possible root causes. Naturally, a skilled facilitator (possibly a consultant) will help, but you can also learn by reading up on the idea¹ and by doing it.

Figure 2. Cause and Effect (Ishikawa or fishbone) diagram with potential root causes marked with capital letter reason codes.

Click here to view larger image

Once the root causes have been identified, then a system of recording the incidents by reason code has to be put in place. In some cases, while occurrences will not be tied to a reason code or other explanatory data, there will be some data that can be used as an approximate surrogate to estimate the order of magnitude of the root cause. In those cases, you can get to an answer sooner, albeit a less precise one.

As an example, forecasting may be coming from sales. You can probably measure the accuracy pretty well by saving the forecast and then by comparing it with orders or shipments. What is harder to determine is how much better your purchasing, manufacturing and distribution would have been if forecasts were 50% more accurate, or what the bottom line benefits would have been. But by making some observations like how often a job had to be interrupted to start another one based on a canceled order or a forecast that was wrong, you can begin to build a collection of data that will be the foundation for answering that question. Then, by creating a cumulative distribution that shows the schedule changes by reason code, you will get an understanding of the size of this problem. Both inventory turns and customer service will go up if you can create a plan that is more flexible, responsive and accurate by attacking the root cause. That root cause might very well be the fact that visibility into the future demand ends with your enterprise. Additional information may be available from your customer, but you do not have access to it.

^{Footnotes
1.} A basic production/operations management text such as will probably help. One good author is Stevenson whose text has been published by Irwin.

Refine Your Forecasting :

By using software tools that help you forecast and work together with others inside your organization, and even with your customers, the forecasts may become more accurate. You can make an assumption on how much improvement might be possible. Then, hypothetically, reduce the schedule changes due to forecast errors by that amount. Research average WIP and reduce that by the same factor. Put a procedure in place to track premium shipments that are paid by your company by reason code. Take the premium freight that is caused by bad forecasts to the bottom line.

Then, since you made an assumption that forecasts could be 50% more accurate, you will need to perform some sensitivity analysis. Vary the 50% and see what the results tell you. This kind of simulation model can be created with a spreadsheet tool.

Data Analysis Challenge Summary :Borrowing the Pareto and Ishikawa tools from TQM practices can help you find data and create information that you did not know was there, but the speed with which this kind of analysis can be performed increases with the availability and accuracy of data. Recent developments in software that support data warehousing, activity based management (ABM) and business scorecard metrics, as well as cause and effect relationships, can enable ongoing evaluation and direction of a given investment decision. In addition, activity based costing (ABC) can provide detailed actual costing data that may increase the breadth and depth of decision support from a supply chain management application.

Identifying the ROI of a Software Application for Supply Chain Management

2009-06-20T07:46:00.002-07:00

Limited time exists to perform analysis - "We need to know now!"
Business analysis skills are lacking - "We are looking for the vendor to tell us!"
The data to perform the analysis are almost always not available in the corporate databases - "We have tons of data, but we don't have it broken down like that."
It is always difficult to predict the future … like forecasting, certain laws about a prediction of ROI will forever hold true…
- the prediction will always be wrong
- the prediction will always change for as long as the analysis continues
- someone is going to be held accountable for the prediction
- "Just give us the bottom line!"

Part 4. "Just give us the bottom line!" :

This reaction to the need to understand the future impact of an investment decision is reminiscent of an individual who wants to know what stock they should buy. This person does not want to learn about industry performance. He or she is not interested in the relative competitive strengths of one company versus those of the other companies in the same industry. Nor is this person motivated to research financial statements in order to understand what might be driving a company's performance or whether that performance is getting better or worse. Such an individual simply wants to know if it will be a good investment and how much can be made at the end of 12 months if it is sold. So he or she scans a list of stock picks in one of the many financial publications, chooses the company ranked at the top, and then "places a bet" because at that point, the decision is little more than a bet based on an uninformed hunch. It is likely that this person will be sadly disappointed in the return. The investor will probably try to recover the loss with an equally unconsidered investment decision, leading to a cycle of poorly informed decisions. Obviously, this individual is putting the amount of money about to be invested at great risk because he or she has latched on to an answer without context.

In the same way, decision-makers in a company may rush to a "bottom-line" conclusion, only to have their efforts frustrated because they did not take the time, or do the work, necessary to gain some understanding of what is driving their pain and how their investment decision may affect those drivers. This will often lead to additional decisions that are made without adequate research and consideration in an effort to recover from the first one.

Where To Start :

An investment in supply chain management software may accrue to your company benefits that manifest themselves through four strategic effects. They are top line revenue growth, reducing requirements for working capital, return on assets, and higher margins. The intermediate effects and the metrics (bulleted) that drive them are outlined below:

Top Line Revenue Growth

Product/service Innovation

Reduced time from concept to production
Less frequent engineering change orders after production release
Increased rate of innovation

Customer Satisfaction

Better on-time delivery (Less canceled orders; also few late penalties)
Higher quality (fewer returns)

Reduced Requirements for Working Capital

Finished goods inventory
WIP inventory
Raw materials inventory
Inventory obsolescence

Higher Return on Fixed Assets (plant and equipment)

Higher Margins

Lower shipping costs (to customers, premium and otherwise; internal distribution)
Reduced late penalties
Lower manufacturing costs (reduced setups, downtime and overtime, better resource allocation)
Lower scrap
Improved product mix
Reduced inventory carrying cost

Improvements in the above metrics can be driven by the following capabilities in a supply chain management application:

Collaborative Product Design
Collaborative Planning and Forecasting
Optimized Manufacturing Planning
Inventory Planning and Optimization
Synchronized Planning
Powerful Detailed Scheduling
Accurate Order Promising
Optimized Transportation Routing
Statistical Process Control

The Causal Metrics Matrix in Figure 3 summarizes how supply chain management software capabilities interact with opportunities for business improvement. It shows metrics across the top that lead to overall improvement in competitive position along the four dimensions previously outlined-top line revenue growth, more available working capital, higher return on assets, and a reduced overall cost structure. Down the left side are the capabilities of supply chain management software that drive improvement in the metrics across the top, and as a result, move the business toward the overall business objectives.

Figure 3. Causal Metrics Matrix

If you are not experiencing some organizational stress in some of the areas where the benefits may occur, then perhaps a decision to invest in supply chain management software should be postponed. If you do have some pain in one or more of these areas, then you can follow the concepts in this article to understand the potential of supply chain management software to fix the cause of the pain and improve your bottom line.

You can probably find out more than you think you can. At a minimum, you will probably identify the decision criteria for which you do not have sufficient data to gain much visibility. As a result, you can at least focus your qualitative judgment in those areas.

Successful business is driven by quality decisions that can be executed in a timely fashion. Some of these decisions relate to investing in software applications that support supply chain management. At least four hurdles face those seeking to make a timely, but intelligent decision. Reliable predictions of ROI will continue to evade decision-makers who react to these challenges with the responses we have studied here. However, if you do not succumb to that temptation, some careful analysis can provide information that will guide your software investment strategy.

SCT and G-Log Form Alliance For Collaborative Logistics in the Process Industries

2009-06-20T07:46:00.001-07:00

SCT (www.sct.com/manufacturing) and G-Log (www.g-log.com), both leaders in their respective fields have announced a partnership that brings together SCT's process industry manufacturing execution, planning, and optimization with G-Log's global logistics platform. The partnership is aimed at process manufacturers and distributors in the food, beverage, chemical, CPG, pharmaceutical, biotechnology, and related process industries worldwide. Both companies currently have impressive lists of customers in these industries using their solutions. G-Log's customers include Eastman Chemical, Dupont, and Kimball International. SCT's customers include Coca Cola, Kroger, Cargill, and Basic American Foods.

Typically, the process industries have robust logistics needs due to the nature of the materials transported. These materials tend to be bulky, heavy and often have special requirements like environmental demands, shelf life or regulatory issues. Many process companies are global in nature and ship using a variety of modes (truck, barge, ocean freight, etc.) further complicating their logistics management needs. This partnership addresses those needs by the expansion of SCT's iProcess.sct solution by improving distribution service and efficiency, while considering real-world transportation constraints.

The G-Log logistics platform supports the mission-critical process of managing all freight, all over the world, in a multi-client environment, by incorporating traditional domestic and international transportation components into a single system. It provides planning, optimization, visibility, control, and settlement of shipments and orders. SCT's iProcess.sct, is a process industry-specific solution that provides supply chain planning, Internet commerce, relationship network management, and supply chain execution/ERP capabilities. The SCT products provide collaborative supply chain distribution and network optimization capabilities. Together, these products will help process enterprises optimize manufacturing, distribution and transportation decisions based on accurate real-time information from their logistics networks.

Darcy MacClaren, senior vice president, business development, of G-Log states, "We believe the combined solution will enable companies to collaborate more effectively with their suppliers, improve customer service, and respond more quickly to market opportunities."

"With the addition of the G-Log solutions, SCT is able to bring a full suite of supply chain planning and execution solutions to the process industries, ranging from network planning and design and enterprise planning all the way down to plant scheduling and transportation execution" states Jim Brown, VP Solutions Strategy and Marketing.

The growth of industry specific or vertical solutions continues with internal development, acquisitions and partnerships. The definition of a "complete solution" continues to evolve. With this partnership, the process industries have a broadened definition of what is possible.

Many vendors continue to pursue the process industries with mixed results. Those vendors focused exclusively on the process industries appear to be growing their solutions towards a greater industry fit. More generalized solutions, those sold to many industries including process, will find the industry specific needs difficult to satisfy within the constraints of their general purpose applications.

Key to process companies is that this partnership addresses major components of operational efficiency, cost, and customer service. The combination allows process companies to address the extended supply chain with the added plus of industry specific functions.

Existing SCT iProcess.sct customers should evaluate the G-Log logistics platform as a way to both add value to their existing iProcess.sct applications and attack their logistics requirements.

Existing process industry G-Log customers looking for added functionality of the related areas of supply chain management, e-business, CRM or ERP should place SCT on their short list regardless of their existing vendor relationships. SCT's strategy of offering industry specific products complementing alternative ERP systems should prove interesting to these companies.

Process companies considering new solutions in the supply chain, e-business, or ERP areas should place SCT on their short list. These companies should consider the added functionality from this partnership for an addition to their requirements list. Most companies will find this combination as one holding significant value in terms of both cost savings and increased efficiency.

CRM is Busting Out Of Its Britches: Operational, Analytical, and Collaborative CRM Are Born

2009-06-20T07:45:00.000-07:00

A Brief (!) History of CRM : In the early 90's, paralleling the publication of Hammer and Champy's Reengineering the Corporation, there were three Northern California companies that each had similar visions of incorporating BPR (Business Process Reengineering) concepts into Front Office applications. They were set to break down departmental barriers, focus on the customer, and enable corporate workers to serve their customers in new, streamlined, and friendly ways. Those three companies were Clarify, Vantive, and Scopus.

Clarify and Scopus started work in the customer support arena, planning to branch out once they gained a customer base and some momentum, while Vantive, with a much broader initial vision that, in retrospect, may have been ten years ahead of its time, focused on a customer-centric database at the core, ringed by all divisions of the company, each having their own "views" into the data they needed. Data was entered one time, existed in one place, and was viewable by all. Very BPR.

My, but we have come a long way. First off, none of those three original companies stand alone any more. The first to go was Scopus, purchased by Siebel in the mid to late 90's to shore up its customer support offering. As an aside, inside information has it that what Siebel bought didn't quite live up to expectations, and they ended up re-building many of the customer support pieces to create the Siebel product you see today.

In 1999, Clarify was purchased by Nortel Networks (see Tech Note Nortel and Clarify: Was There Ever Enough Synergy to Support this Marriage?). Enough said here.

And finally, Vantive was bought by Peoplesoft, the HRMS (Human Resource Management System) plus SCM (Supply Chain Management) software company. At first blush it struck many as an odd pairing of two companies desperate for some good corporate vision. But Peoplesoft (with Vantive) seems to have renewed vigor. If execution and focus are a part of the culture now at Peoplesoft, it all may pay off in the end (see PeopleSoft 8 Launched - Anything to Write Home About?).

All the while, in the late 90's dot-com craze, when "money was free" and intellectual capital and software functionality were key, you had smaller niche players developing ideas about how to do everything from improving customers' online experiences, to establishing vertical and horizontal portals, to analyzing employee performance, to using data to target qualified leads. And other, larger companies, were quietly adding the three letters C.R.M. to their websites, and eating smaller vendors for lunch, for fear of being lost in the Back Office-cum-ERP/SCM, Front Office-cum-CRM world. And wave after wave of multi-million if not multi-billion dollar buy outs and consolidations (for one example, see the Kana reference in the Tech Note sited above) lapped the corporate shores.

As the technology development and consolidation continues unphased, if not stoked, by the economic downturn today, analysts, busy re-defining CRM as "a software space" and "an ecosystem," - very fuzzy - have given rise to the notion of sub areas of CRM; namely, Operational CRM, Analytical CRM and Collaborative CRM. We've got wireless customer service, customer self-service, marketing analytics, collaborative e-commerce, employee portals, operational data stores, data warehouses, data marts, data about data (metadata), business intelligence, OLTP and OLAP, and enterprise value management� we can't call all that, simply, CRM, now could we?

Analysts like to compartmentalize in an effort to simplify and understand, and forecast winners and losers, and prognosticate on the future. Sometimes we over-compartmentalize, and over-define, to the point of confusion. And sometimes, we almost make sense of it all, and help buyers of technology know both what's available, and what's right for them. So, let's try if we may.
Some Simple Definitions, Please :

Let's start by looking at OUR definition of CRM Software:

Customer Relationship Management

Customer Relationship Management Software promotes the direct interaction between customers and the company through support of the people and processes involved in the entire customer lifecycle. CRM Software fosters a comprehensive, integrated approach to the customer, putting the customer at the center and integrating such corporate functions as Sales, Marketing, Customer Support, and Field Sales and Service, all in an effort to increase Customer Satisfaction, improve internal morale, increase sales, and differentiate the company from its competitors.

Figure 1.

Operational CRM

Operational CRM is at the heart of what we've previously just called CRM. It includes the components of CRM software that interact with the Back Office applications (such as ERP, SCM, and e-Procurement) in order to get product moving; it includes all of the business intelligence to automate or help facilitate the daily tasks of the Service, Marketing, and Sales teams, and to move information between them, and out to the Logistics and Financial folk; it also facilitates the flow of information to and from the forces in the Field, both Sales and Service. In a simple way, you can think of Operational CRM as Internal CRM, though that would give the image that it's a misnomer considering our global definition of CRM, above. It's not. The Operational aspects certainly promote timely and successful interactions with the customers, but behind the scenes.

Analytical CRM

Analytical CRM is a subset of the larger game of Corporate Business Intelligence, which itself grandly intends to reach across the boundaries of CRM to pull together all the data resources in the company, extract and transform the data in a sensible way, load it into one place, and be able to analyze corporate performance in a unified manner. Analytical CRM focuses specifically on the customer interaction and satisfaction piece of Corporate Business Intelligence.

Through measurement of customer reactions and interactions, it can help a company analyze and understand such things as: the success rate of marketing campaigns; sales rates and the performance of the sales team members; other sales related issues such as Customer profitability (considering both Sales and Service costs), Pipeline Revenue analysis, and product line success and trending. It can also help companies understand customer satisfaction rates and trends, and the performance of their service personnel; it can help cmpanies perform so-called web clickstream analysis to understand what their customers are looking at on their site; hence, what they like about or on the web site, and what doesn't work or attract so well; etc. And it can do this with new, real-time technology using data stores and user-interface dashboards, or OLAP (OnLine Analytic Processing), or the more mundane hard reports, and pushing it all to web information portals that are either customer-facing, or internal-facing, or both.

Remember, "you can't change what you don't measure." Analytical CRM, and Corporate Business Intelligence, are hard core and here to stay, and will only become more important as the fight to keep customers loyal and happy rages ever fiercer.

Collaborative CRM

Now, we get to the wizzy, obvious, up-front stuff that has given CRM the e-CRM makeover, and made everyone so excited about reducing costs and improving web-based service. This is the part about the new, cooperative efforts in CRM, like web conferencing, web forms handling, automated email handling, and unified message handling and intelligent message routing; web assistance tools such as Live Chat facilities, and Voice over IP (VoIP), and collaborative web browsing; and guided selling, and the soon-to-be omnipresent Call Me button.

Problem is, the more ways that you give people to interact with you, and the easier you make it, the more often those people will interact with you, and that may not save you Service overhead costs. You need to carefully understand the people-power ramifications behind e-CRM before making the leap. Just because customers may be happy with the new, often less-personal methods of interacting with their consumer companies, doesn't make this a wise decision for your company. Your support costs may actually rise. That may be OK, if your happy with the offsetting customer-satisfaction numbers. But be aware.

We're Ready, and We Want All Of It: User Recommendations : CRM implementations, if done in their entirety, can literally take years of time and millions of dollars. Phased implementation planning is a necessity. "You just can't eat all of the food you'll ever eat in your entire life, at one sitting." Your focus must be on prioritization, which in turn is based on asking yourself several key questions: where are the worst pain points in my company? Are my customers complaining of lousy service? Is internal morale low? Are my sales folks lone gunmen, running Act! 2000 on their own laptops with those cool screen layovers that don't let anyone look over their shoulders? Are we giving away services that we shouldn't be? Do we know where our profits are really coming from, and which of our products are dogs?

The First Phase of any successful CRM implementation is the Alignment and Planning phase. Align your corporate processes with your corporate goals. Then plan on multiple, short-term, quick-win phases. With this approach, you'll win over your customers, let your employees settle more slowly into new roles or processes� and let your CFO swallow purchase order requests in smaller chunks.

According to Forrester Research, for most companies, it's not a question of whether to CRM or not to CRM: Forrester says that 47% of all companies are "considering CRM," and 37% are in the implementation phase. Get in the ballgame, but play it one inning at a time.