Governments, special districts, utilities, and other similar organizations have some very unique requirements that not all financial/ERP software vendors can handle. For this reason, there are many software solutions that focus on this market – offering government entities a variety of options to consider. We attended the GFOA conference in Atlanta at the beginning of June 2010 and interviewed some of the financial/ERP software vendors that focus on government organizations.
This year, the show was definitely quieter than in past years. No doubt the economy has had a big impact on the number of people attending as governments just do not have the discretionary income to send many people to GFOA. However, as we talked with many of the software vendors, they seem to be seeing an increase in interest and sales from government entities so hopefully things are turning around and the market and economy in general are improving.
Over the next few weeks, we will be publishing video interviews with many of the government ERP software vendors, so watch for them! These videos will help you get some background on the various government software vendor’s ERP products, their target markets, and new functionality that will be released soon. Hopefully, this will help you focus on vendors that may be right for your software selection project. If you would like our take on any of the software vendors that you may be considering, feel free to call us at SoftResources (425) 216-4030 and we would be happy to discuss our experience working with them for our software selection clients, and things to look for as you evaluate them for your requirements.
If you weren’t able to make it to the show, check out the video posted below to get a quick view of the GFOA tradeshow floor and some of the ERP software vendors that exhibited.
Lawson software was originally founded in the 1970′s and remained a private company until December 2001, when they went public. Originally built on the AS400 platform, the software has migrated through the client/server era and now is 100% web enabled which means that you can use a web browser to access the software, as well as thin client options as well. Unlike JD Edwards which similarly came from the AS400 and subsequently got acquired by PeopleSoft and then Oracle, Lawson has remained a stand-alone company. They made a large acquisition in 2005 by acquiring Intentia – a european based manufacturing solution. Last year Lawson was profitable and had $757M in revenues.
The important thing to remember as you evaluate Lawson software is that they have two separate ERP software products – Lawson S3 and M3.
Lawson S3 is the traditional Lawson product. This software is a very strong financial solution that has a very broad implementation base in many different industries. S3 has a particular focus on Financials, Health Care, Non-Profits, Government, and service based organizations. It also has a very strong Human Capital Management (HCM – otherwise known as Human Resources). In fact, many organizations use Lawson’s HR solution as a stand alone HR product even if they do not use Lawson’s S3 ERP product. S3 also touts a very strong reporting tool called Lawson Business Intelligence (LBI).
Lawson M3 came to Lawson through the Intentia acquisition. This ERP is focused on Manufacturing and Distribution companies and is a stronger multi-national solution than S3. (In fact the majority of Lawson international installations and offices are focused on the M3 product). Keep in mind that this product is completely separate from S3. For example, the strong S3 HR solution would require an integration to the M3 product.
With regard to implementation, Lawson has their internal Professional Services Organization, but also has a network of 200+ software integrators in their Lawson Partner Network. Some of these partners focus on S3, while others focus on M3. Make sure that you do an implementation partner selection when considering Lawson to find an implementation partner with experience in your industry and the specific product you are implementing. Many times these partners have more experience in a particular industry at lower billing rates than Lawson’s direct implementation.
We consider both S3 and M3 to be Tier 2 ERP solutions in our 5 Tier Chart(www.softresources.com/software-market-overview). This means that Lawson can compete very favorably with the Oracle suite of products as well as SAP at a lower cost. Over the past 15 years we have been doing software selection consulting, both Lawson S3 and M3 have been selected by various clients. These products are definitely worth consideration as you evaluate your ERP software options.
We are currently working with a client that is considering PeopleSoft – one of the ERP applications that Oracle acquired a few years ago. The PeopleSoft product looks like a possible fit, but it was interesting to note that the salespeople did not talk much about the new Oracle Fusion product and the fact that this new ERP software is less than 1-2 years away from release.
I thought this was very interesting. One would think that a brand new ERP software product from one of the largest ERP software vendors in the world would be promoted heavily. But Oracle is almost completely silent about the development of this product even though they have to be spending many millions of dollars in R&D for this product right now.
Why isn’t Larry Ellison shouting from the tops of the trees that Oracle Fusion applications are coming? Because they are trying to protect the current sales of the e-Business Suite, PeopleSoft, and JD Edwards ERP solutions.
Right after the acquisition of PeopleSoft/JD Edwards, Oracle began talking up the idea of their new Super ERP product “Fusion” that would Fuse all of the best functionality from the 3 ERP products Oracle owns. They were also going to put functionality from other acquisitions such as Siebel and Hyperion into the new solution. It would be web based and facilitate Software as a Service (SaaS) as well as on-premise deployments.
Competitors began seeing this as an opportunity to create uncertainty about Oracle’s current ERP solutions. They asked “Why would you buy e-Business suite when it will be replaced within the next couple of years?” This hurt current sales and revenues, while the Fusion application was still years away from being released. So, they dropped the marketing for the new Fusion ERP Applications product.
In fact, if you go to Oracle’s website there is just a 1-page overview that Oracle’s Fusion applications are under development. Interestingly, the first thing you see is how Oracle will support all of the current products with Lifetime Application Support. Again you can see their concern that the announcement of future Fusion applications will hurt sales of their current products.
Now I do not doubt that when Fusion comes out, Oracle will continue to support companies on e-Business Suite, PeopleSoft, and JD Edwards for a long time. All of them have significant numbers of installations and they receive billions in annual maintenance revenues from these companies. However, when Fusion is released, the focus for new sales will be the Fusion product. This means that the sales goal within Oracle will be to upgrade all of these companies to the new product eventually. Which will be a huge revenue stream for Oracle.
That is why you will hear almost nothing about Fusion until it is released. Just know that if you currently own an Oracle product, or are looking to purchase one, that you will eventually be encouraged to upgrade to Fusion Applications. Make sure that if you are considering an Oracle product, that an upgrade to Fusion is included in your contract.
SunGard is a unique software vendor with its roots actually in the oil business – in the early 1980’s, SunGard spun-off from the Sun Oil Company. Their growth as a software company has primarily been through acquisition – concentrating on 3 software target verticals: Financials, Higher Education and Public Sector.
Recently, SoftResources participated in scripted demonstrations of SunGard’s new flagship product for the Public Sector – BusinessPLUS. BusinessPLUS is the result of an effort by SunGard to integrate its Public Sector software acquisitions into a single, web-based Enterprise Resources Planning (ERP) product. The products included in this integration were: BiTech, Pentamation, HTE, Open Software Solutions, Inc. and Vivista Holdings Limited out of the UK. What about IFAS? IFAS was actually the new name of the BiTech product and used as the basis for the new BusinessPLUS major release approximately 18 months ago. (Software vendor’s like to re-name and re-brand their products so it is important to truly understand the genealogy of the software you are considering!)
BusinessPLUS was considered a “major release” because .NET code was used to bring together several applications with different underlying source code (C++, C#, COBAL, etc.) to create a unified look and feel of the system. .NET technologies allow SunGard to have a web-based product without completely rewriting the source code to these systems. It should be noted that SunGard has some pieces of the “classic” system in their solution that have not been written in the .NET technology. For example, if a payroll clerk is doing head’s down multiple timecard entry, the “classic” timecard screen is best suited for that purpose at this point. However, the parts of the system that have not been enhanced with .NET are likely to be updated over time.
SunGard’s roadmap includes a commitment to develop and enhance BusinessPLUS as their flagship product, In fact, they will no longer sell the older products like Pentamation or HTE and will only support 2 prior versions of the software. This means that customers on the older software solutions will either need to go off maintenance and support their own software internally, or they will eventually move to the BusinessPLUS system. They have formed specific professional services groups for sub-sets of the Public Sector such as municipalities, non-profits and K-12 school districts. SunGard believes this focus will allow current and potential customer’s access to industry experts in their respective fields who understand how the software should work for their vertical market.
SunGard is showing some momentum. They estimate that 30 – 40 customers have either upgraded or purchased BusinessPLUS since its release in November 2008. If you are going through a software evaluation in the public sector, you should definitely consider BusinessPLUS on your list of ERP software solutions.
We are currently doing a software evaluation for a client and one of the software vendors we are considering is Epicor. You may recall that Epicor is the old Platinum Software that started in the 1980′s and was a very big competitor to Great Plains (now part of Microsoft) and State of the Art (now known as SAGE). They have acquired many software vendors over the past 10 years and now claim to have done what Microsoft and Oracle have failed to do – make a Super ERP product by combining the “best” of all of their acquired software products into one ERP solution.
They called the new software Epicor 9 because it is a combination of 9 software products – Vantage, Enterprise (Formerly Platinum SQL), Vista, Avante, Manfact, DataFlo, Manage 2000, iScala, and Platinum for Windows. They currently have about 130 total installations that are live with the product and about 200+ companies that are in some stage of installing the software.
It is important to note that they say they will remain committed to continue to support and upgrade each of the individual software solutions they have acquired. However, their sales efforts have been focused on the Epicor 9 solution which means that upgrades and enhancements will slow for the other products and they will eventually phase them out.
The reality is that this software is a major upgrade to the Epicor Vantage product – written in .NET (They claim to be more Microsoft than Microsoft’s products). They have taken pieces and ideas from the other solutions they offer but this is really a Vantage upgrade. That being said, they have been making some noise in the market and are gaining traction. We will watch this product with interest and they should definitely be considered for an ERP software evaluation project.
Microsoft Dynamics AX (formerly Axapta) is one of the four ERP software products offered by Microsoft. (The others are Dynamics GP – formerly Great Plains, Dynamics SL – formerly Solomon, and Dynamics NAV – formerly Navision). Microsoft acquired Axapta in 2001 and has really focused a lot of development and marketing on this product. Of the 4 ERP products, AX is the best suited for larger organizations and is a very strong product. This makes it a good platform to move the product up market to compete against some of the larger competitors such as Oracle, and SAP. While the product is not currently at the level of the Oracle and SAP products (Microsoft marketing people may dispute this!), they are adding a tremendous amount of functionality to be able to compete in that space with this product.
We spoke with Guy Weismantel at the National Retail Federation tradeshow in January 2010. Guy is Director of Marketing for ERP software and he gave us a good background on the direction of AX product development. With all of Microsoft’s ERP products, the strategy has been to provide a good base ERP software package and let the Independent Software Vendors (ISV’s) develop industry specific solutions. This strategy works well in the mid-market, but larger companies demand more integrated solutions. So in order to hit some key target vertical market industries, they have decided to focus on 5 industries, by buying ISV solutions to jump start the process of developing a solution for that industry. These industries are described in the video below and include: Government, Retail, Banking, Financial Services, and Non-Profit. Although Manufacturing was not included in this group, AX has manufacturing roots and is a strong product in that industry already.
Take a look at the video below to get a better understanding of the direction that Microsoft is taking Microsoft Dynamics AX.
As we mentioned in our last post, Microsoft will be focusing retail software development efforts on the Microsoft Dynamics AX platform with a product that will be in general release 3Q 2010. This product was built using code developed by LS Retail, an Independent Software Vendor (ISV) with the goal of providing a completely integrated retail software solution directly from Microsoft. It is important to note that LS Retail continues as a stand-alone ISV that develops a retail software solution add-on for both Microsoft Dynamics AX and Microsoft Dynamics NAV. This means that from this point forward, development for LS Retail’s Dynamics AX retail software add-on will diverge from the development of the new Microsoft Dynamics AX Retail product.
Basically, Microsoft used LS Retail’s AX retail add-on solution to jump start the development of a “Microsoft” retail software solution. This means that they did not have to start developing a retail system from scratch as the LS Retail product is already based on the Dynamics AX toolset, which is actually a pretty smart move if they want to come to market with a solution quickly. Plus, I am sure that LS Retail was paid a tidy sum to allow Microsoft to use their code for the project, so it is probably a win-win for both sides. The biggest danger to LS Retail would be that Microsoft’s retail product eventually makes their product obsolete, but they must have assessed that in their analysis.
So you can see that while the Microsoft Dynamics AX Retail product is currently in Beta testing with 3 installations, it actually has a much more stable background because of all of the installations that LS Retail has with the software. The main question would be how much modification has been done to the LS Retail code and what additional features were added by Microsoft development? I would imagine that for right now, there are only minor changes to the software and that it is fairly stable as far as beta software goes. However it will be very interesting to see where Microsoft takes the product from here.
Another interesting thing to note is that Microsoft has been positioning the AX product more to the higher end of the market in what we call the Tier 2 and even up to the Tier 1 companies and competing against the likes of Oracle, Lawson, JD Edwards (Oracle), and even SAP on occasion. (See SoftResources Tier Chart at www.softresources.com/software-market-overview) The Microsoft RMS product (which is Microsoft’s current multi-store retail solution with many installations) is focused more on smaller retailers in the tier 4 and tier 3 market. Microsoft claims that Dynamics AX Retail will be able to scale from tier 4 all the way up to tier 1 companies. We will see if they can make the pricing work at both ends of the scale and if they can make it simple enough for the small companies to not be overwhelmed, yet sophisticated enough to handle large retailers complex requirements. Traditionally software vendors have had a hard time making a ”one-size-fits-all” solution.
Here is a quick look at the Microsoft booth at the NRF show 2010 with some of my impressions from the floor of the show. It also includes an interview with the Microsoft ERP Marketing Director Guy Weismantal regarding the strategy for Dynamics AX Retail. Guy describes the plan for general release in summer 2010. When he mentions IP, he means the “Intellectual Property” or code they bought from LS Retail to create the Dynamics AX Retail software.
As I visited the Microsoft booth at National Retail Federation I was impressed with the surface computer they had on display and the really cool wall display that could be used in future retail stores. What I didn’t see was anything about Microsoft RMS. I looked and asked about the product, but they had no RMS representation at all. Instead, they had a very large display of Microsoft Dynamics AX Retail. What is going on with Microsoft’s retail strategy?
After further investigation and a conversation with representatives from Microsoft, here is my understanding of the Microsoft POS Roadmap. Please note that this is just my interpretation of their roadmap, so I am not speaking directly for Microsoft on this, but I think I have a good idea about the direction they are headed.
There are 3 retail software products now offered by Microsoft – Microsoft POS 2009; Retail Management System (RMS); and Dynamics AX for Retail.
Microsoft POS 2009 - This product was built from the ground up using the .NET architecture and was released in 3Q 2009. POS 2009 is focused on the low end of the market with retailers that have a SINGLE STORE ONLY. The POS system has no HQ solution and would have to integrate to a financial system on the back end. It was built to compete with Quickbooks and small end POS solutions (of which there are many) on the market.
Microsoft RMS – This is the system that Microsoft acquired a number of years ago and actually has a large number of installations. It handles multi-store environments and is more scalable than POS 2009. However the product does not have an accounting back office and must link to a separate accounting system like Dynamics GP or Sage MAS 500. The system also lacks some of the more advanced retail features like Open to Buy. Microsoft has decided that this product will have a few more years of upgrades and enhancements and will then stop development of new features for the software sometime in the 2012-2014 time period. Microsoft will then begin the process of moving RMS users to the new Dynamics AX Retail product. Microsoft will continue to support the product for years after that because of the large install base, but there is definitely a limit to the lifespan of this product.
Microsoft Dynamics AX Retail – This is where Microsoft is putting their future in the retail industry. Dynamics AX is the former Damgaard Axapta product that was acquired by Microsoft in the 2000-2001 timeframe. It is a very functional ERP software solution that is very flexible. Like many of the other ERP software solutions sold by Microsoft (GP, NAV, SL) there are a number of Independent Software Vendor (ISV) companies that have developed add-ons to the AX product. One of these is LS Retail and they developed a retail add-on to the AX product. In order to develop a core retail solution within AX, Microsoft bought the retail code from LS Retail and has made further modifications and branded the software Dynamics AX Retail. Microsoft is just getting this product off the ground and has 3 beta installs in process. They see this product as a scalable product for retailers with 1 store on up to very large retail chains, that offers full functionality including the back office financials.
I will be talking more about Microsoft and their strategy soon…
Gemmar which is a mid-market apparel focused retail software solution based out of Canada has recently signed an agreement to sell the product in the US through a reseller JD Associates. The following is the latest information from Gemmar:
Gemmar System’s International Retail 1 retail management solution targets mid-market Apparel retailers as it’s primary focus of business. Headquartered out of Montreal, Quebec, it has a
customer base of over 200 retail chains of which approximately 75% are Apparel retailers. Around 20% of all clients have a U.S. base of operations. The Retail 1 Suite provides coverage for multi-channel sales activities including catalog and Web store fronts. Gemmar has been around for over 26 years and leverages the Microsoft Technology stack including Web Services.
Company: Gemmar Systems International, Inc. Product: Retail 1 Year Founded: 1983 Ownership: Private Target Market: 10 to 200 Stores, 1-20 POS per location. Sweet spot are chains with 30-80 stores. Verticals: Apparel, General Retail, Sporting Goods (contact vendor for more verticals). Total Customers: 200 (North America) Technology: Windows 2007, Database: MS SQL Server 7.0 Hardware Requirements: Non proprietary. Contact vendor for additional hardware specifications. Strengths/Notable Features: Retail-1 Merchant: Application suite including inventory management, merchandising and Open to Buy capabilities. Full layaway and special order capabilities, multi-level merchandise planning, style/color/size matrix. Business Intelligence with KPI supported in Analytics suite. CRM, AR Analysis. Order Management, Distribution, Warehouse, financials. Interface bridge to MS Dynamics GP. Assortment Planning is future module. Sales Channel: Direct or via Partner (JD Associates)
We spoke with John Deery who is the owner of JD Associates (the US distributor of Gemmar) to get an update on what is happening with his organization. JD Associates actually sells 3 products – Microsoft RMS (100 installations), RetailPro, (600 installations) and they recently picked up Gemmar. They focus on apparel, footwear, and general retail stores.
Multidev Technologies’ ChainDrive retail management software is a mid-market system with it’s origin for retailers in Apparel and has since branched out into Footwear, Jewelry, Sporting Goods and General Department Stores. In particular, they provide Open to Buy functionality in their suite, which is a main component for Apparel retailers and others who want to leverage merchandising planning for just in time inventory decisions. Although operations are based out of Montreal Quebec, ChainDrive has made inroads into the U.S. market which is their primary sales target.
Company: Multidev Technologies Product: ChainDrive (for retail chains) Year Founded: 1997 (ChainDrive product line developed after this time). Ownership: Private Target Market: Retailers with 10 – 300 locations, with sweet spot in the 60-70 store range. Verticals: POS and back end financials for Apparel, Footwear, Sporting Goods, Jewelry and General Retail/Department Stores. Total Customers: 120+ companies. Many are multi-site, multi-channel. Approximately half are Apparel retailers. Technology: Borland Interbase SQL database. Strengths/Notable Features: Has complete sruite of functionality including financial modules, but can interface to mainstream financials such as MS Dynamics GP or Oracle. Full analytics and performance reporting with KPI’s, graphical dashboard display. Modules/features include Mobile Marketing, CRM, Workforce Management, Operations, Accounting, Merchandising, Multi-dimensional Open to Buy (Planning), Style/Color/Size Matrix, Product Management, Store Budgeting, Warehouse, Wholesale Management and Point of Sale. Sales Channel: Direct Other: Also offers StoreDrive for single retail locations. Hardware is available for an all-in-one solution for small retailers.
We caught up with Mark Carter from ChainDrive at the NRF 2010 show and here is the video from that interview.
Be the First to Comment