PeopleSoft Revamps World for Its Mid-Market "Express" Conquest Part Four

Recently "inaugurated" as the No. 2 leading business applications provider after digesting the former J.D. Edwards & Company, PeopleSoft, Inc. (NASDAQ: PSFT), has been making decisive moves to deliver a number of new, and refurbished solutions, in a great part by leveraging its recently acquired product portfolio. Although the vendor has acted swiftly on assimilating its former competitor (see PeopleSoft Gathers Manufacturing and SCM Wherewithal), these recent initiatives might show us that the vendor has moved even farther from the digestion stage and into a full-blown execution and productivity phase.

Recent announcements that reflect this are

* PeopleSoft World Express, one of the industry's most comprehensive solutions for smaller businesses with annual revenues between $20 million and $100 million (USD), on May 3, at COMMON 2004, the IBM iSeries user conference.

* A new release of PeopleSoft World that included more than 280 new features and enhancements that span the product family's human capital management (HCM), supply chain management (SCM), and financial management (FM) applications, and a new web-based user interface (UI),on March 18 at CeBIT 2004.

* Further extensions of the longstanding partnership with IBM (NYSE: IBM) announced during PeopleSoft 2004 Leadership Summit which expands their global alliance by enabling IBM's expanding SMB reseller channel (see IBM Express-es Its Candid Desire for SMEs) to offer PeopleSoft applications. PeopleSoft on May 18.

For details, see Part One.

Although the World Express product is aimed at new, prospective customers (estimated 50,000 in North America), there may be an indirect importance of assuring the existing, still disheartened PeopleSoft World install base and channel of the product's brighter future. The product has undergone significant enhancements almost immediately after the merger, such as the integration with PeopleSoft EPM and the above-mentioned annual cumulative update for the release 7.3. Further, given that the integration with PeopleSoft SRM is slated for the end of 2004, and the next annual cumulative update should take place early in 2005, these events should be the best testimonials of the new owner's renewed commitment to the long neglected product line.

However, getting the market and the channel's mindset back into the more active selling of the product will not be that easy given a protracted limbo (PeopleSoft claims a few dozen new sales during 2003, without any significant orchestrated marketing and sales effort). No wonder then that the most likely torch bearing proponent at this stage will be IBM and its channel of iSeries resellers and distributors. Even pre-merger PeopleSoft and IBM have had some history since early in 2001. They announced a partnership to speed up the delivery of business applications for small and medium businesses (SMB), as PeopleSoft had early targeted IBM Business Partners to offer mid-market prospects a rapid deployment program for former PeopleSoft 8 (now PeopleSoft Enterprise) accelerated applications. The companies then announced Architecture Jumpstart, an ISO 9000 certified, rapid eBusiness deployment program designed for the fast implementation needs of mid-market customers. The pre-packaged turnkey solution included a workstation and an application and database server, all pre-bundled and offered with fixed pricing to deliver a completely installed and configured environment which includes demo, testing, training, and production databases.

Yet, it may still take some serious effort to produce a real magic bullet to attract the vast majority of smaller enterprises even with these latest initiatives. PeopleSoft needs to more efficiently mine its client base by doing a better job of selling the broadened offering, by getting its affiliate channel both excited about the product portfolio, and by upgrading the channel's ability to sell. For new customers, the vendor will still have to resolve the predicament of its association with the old, green-screen, AS/400 product. Despite IBM's efforts to counter the platform's image of being proprietary (even by renaming it into iSeries, i5, etc.), the market has been slow in warming up to it for e-business implementations. Namely, the initial price and the need for specially trained RPG development language administrators that are not that ubiquitous in the market like Microsoft Visual Basic (VB) programmers, have not really boded well for IBM's massive acceptance within the space. Moreover, overcoming the Microsoft barrier entry will likely be the major challenge, given Microsoft's ubiquitous position within the small and medium enterprise (SME) segment, particularly with products like Office, Exchange and SQL Server. Time will only tell how the equivalent counterpart products from IBM, such as Workplace, MQ Express or Connect Express will help in that regard.

This is Part Four of a four-part note.

Part One detailed recent announcements.

Parts Two and Three discussed the market impact.

Competitive Challenges

Also, as said earlier, the Microsoft-centric SMB application vendors understand this market and in addition to product offering, they have long heavily invested in recruiting, motivating, and supporting the resellers that service the segment. There are also influencers like certified public accountants (CPAs) and small and midsize accounting companies that make recommendations to their clients which packages to deploy, and Sage and ACCPAC have for decades been cultivating awareness and relationships within this community, which can be neither easily nor quickly toppled. Some of them also offer "no-frills" on-line or retail sold, entry level or "feeder" business-application packages that attract small businesses early on, such as BusinessWorks Gold, QuickBooks Premier, Peachtree, or ACCPAC Simply Accounting Pro, then these vendors provide more advanced functions and more scalable software as the small businesses grow.

Even in the case of an increased demand within the IBM technology-inclined prospective customers, PeopleSoft is not the only one "in bed" with IBM. For example, one will likely see on the standard menu a number of individual industry solutions (at least from MAPICS and SSA Global) that virtually offer similar solutions to World, ringing the similar rejuvenating changes of a web-based UI, WebSphere portal, and so on, while these products are also the incumbent veteran products in the segment. As some possible differentiation, the World Express solutions include the essential steps of the core business processes that almost any company in the targeted vertical markets would require. The configuration is designed to adapt to special customer requirements when needed, and expands to include additional functionality that is available in World Software. Tailoring the configuration will require additional consulting, but the PeopleSoft World management team believes that it will be faster and more cost-effective to tailor the existing image than to configure the entire system. This approach to implementation services gives the customer control over the amount of consulting needed to implement the software, allowing the customer to assess the relationship between cost and return on almost every significant implementation decision.

Yet, not all powerful and possibly exciting PeopleSoft Enteprise/PeopleSoft EnterpriseOne functionality that have been touted recently at the Leadership Summit (e.g., customer relationship management demand-driven manufacturing, diagnostics, predictive and prescriptive analytics, etc.) is available for World and World Express solutions, which may be a serious drawback when competing against the other vendors, which have long offered their entire suites without any disparity between solutions for bigger and smaller customers. Although PeopleSoft has been impressively moving quickly to create parallel products, transferring functionality among PeopleSoft, former JCIT's Demand Flow and former J.D. Edwards' products to fill existing gaps, many competitors offer these now within more homogenous product suites.

Therefore, the World Express solutions, while enabling PeopleSoft and its channel to offer a fixed price and fixed time implementation program in an "out-of-the-box" way, may not necessarily offer total extended-ERP functional scope, but still only a part of extended-ERP. By the time the customer puts together modules to build a full collaborative enterprise system for a mid-market company, and then adds up the multiple implementation time and cost, all the touted benefits might have been annulled in some instances when incumbent mid-market vendors cover all the bases with their well-entrenched offering. At this stage, the company officials admit only a "wait-and-see" stance to assess the need for eventual product enhancements in the above areas down the track. The situation is additionally aggravated by the fact that the World install base is still divided between the two different product releases, 7.3 and 8.1, which feature slightly different capabilities and are on different annual cumulative update tracks (e.g., the 6th annual cumulative update for 8.1 is slated for Q3 2004, whereas the 16th annual cumulative update for 7.3 is slated for Q1 2005).




SOURCE:-
http://www.technologyevaluation.com/research/articles/peoplesoft-revamps-world-for-its-mid-market-express-conquest-part-four-challenges-and-user-recommendations-17416/

ERP and WMS Co-Existence: When System Worlds Collide

Typically, after the enterprise resource planning (ERP) software has settled in, you may start to investigate ways to improve your warehouse management and operations through the use of a warehouse management system (WMS). Unless you're faster than a speeding bullet and can leap tall buildings in a single bound, normally you do not install both ERP software and a WMS at the same time. Regardless of your approach, early on you will notice an overlap in warehouse functionality between the ERP software and a WMS. When comparing the warehouse functions and features embedded in ERP software against those in a WMS, the ERP software usually comes out on the short end of the measuring stick. So your path is obvious; use the WMS for inventory related functions. Not so fast big fellow.

Focusing on warehouse functionality that is typically contained in both software solutions, this article discusses the merits of using the features of one software solution over the other. This discussion will concentrate on outbound, inbound, and miscellaneous warehouse processes. Most importantly, it concludes with an identification of the critical interfaces, where a majority of the work is to be done. While there are no exactitudes and you may be left with more questions than answers, completing the thought process can help you gain an appreciation of the complexities of making these two software solutions work together effectively for your organization.

Outbound Processes


The outbound function consists of processes that deal with getting product to the customer. As shown on the outbound processes chart, there are functions such as order taking, invoicing, cash receipts, and accounting activities that are not part of a warehouse's operations. The choice for each of these processes is simple since they should only exist in the ERP software. However, when discussing inventory, there are several choices. Picking comes in two flavors: (1) picking for production orders and (2) picking for customer orders.

Picking for production orders is the process whereby ingredients and parts are moved from the warehouse to the production lines. Typically, the decision on what to make or produce is based on what you have in inventory in terms of ingredients and parts. There is considerable scheduling and setup required for a production run. Furthermore, a decision to make one product over another could make resources and equipment unavailable for other operations. This all means that assurances must be made that you can actually make what you plan and schedule. For these reasons, picking of ingredients and parts should be an integral part of the production cycle. Since production is part of the ERP software, it makes most sense that picking for production orders should also be made in and using the ERP software.

Picking for customer orders is the process of selecting finished goods resulting from production runs, assembling them for shipment and loading, and, then, shipping the goods to customers. Assuming that you produce in bulk or volume, picking for customer orders occurs more frequently and in smaller quantities (See TEC article on What You Know Before Selecting A WMS Posted on May 29, 2003). Consequently, efficiencies to be gained from these picks can be more significant and numerous than those for production orders. Rules for tweaking the way picks are generated are typically more flexible and accommodating in a WMS. For this reason, picks for customer orders should be made in the WMS. To complete the customer order processing, it is only logical to perform the shipping and logistical processes in the WMS as well.

You will have to wait until the exciting conclusion to read where the official inventory, both ingredients and finished goods, are to be maintained. The fact, that inventory has to be updated in both the ERP software and the WMS, doesn't offer much of a clue.

Inbound Processes

The inbound function consists of processes that deal with ordering, receiving and storing material used to manufacture products. As with the outbound discussion, there are certain processes for which there is no choice. These processes include purchasing and purchase order generation, vendor invoice processing, cash disbursement, and accounting activities as indicated in the inbound processes chart.
Disposing of these administrative tasks, the physical act of receiving and storing the inventory in the warehouse can best be accomplished in the WMS.

Even when not using ERP software, purchasing information needs to be ported to the WMS in order that receipts can be validated and approved. Since at some point information must be transferred and inputted into the WMS, receiving represents a clean demarcation. This being the case, the receiving process initiates the inbound processes resident in the WMS. A WMS will have putaway logic to suggest stock locations whereby ingredients and goods are more readily accessible, reduce warehouse travel time, and maximize the use of available space. Likewise, since this inventory will eventually be used to satisfy production and customer orders, it is logical to use the barcode and label functionality available in a WMS as materials are being placed into stocking locations. Again, inventory updating would need to be accomplished in both software systems.

Miscellaneous Processes


Miscellaneous processes consist of those activities needed to ensure that the warehouse inventory is accurate and that promote good warehouse practices and procedures. These processes include inventory control and management, stock consolidation, and stock locator. Inventory control and management includes physical and cycle counting and intra and inter-warehouse transfers.

It is a general rule of thumb that a software solution that focuses on one discipline is better at supporting the single discipline as opposed to software supporting multiple disciplines. This is why you look to a WMS to satisfy these miscellaneous processes. A prime benefit of a WMS is suggested inventory movements and consolidations to increase warehouse efficiencies. Inventory counting schemas in a WMS are typically more adaptable to your environment, thereby creating the least downtime and disruption to warehouse operations.

Obviously, inventory management functionality of both software solutions needs be evaluated objectively. However, any WMS worth its reputation and cost should be able to provide more effective tools to solve your existing warehouse problems. If not, you should question the purchase of a WMS in the first place.


SOURCE:-
http://www.technologyevaluation.com/research/articles/erp-and-wms-co-existence-when-system-worlds-collide-16984/

Software as a Service for Customer Relationship Management and Sales

The emergence of independent software as a service (SaaS) providers has created a major competitive challenge for most of the established independent software vendors (ISV). The Wall Street Journal (WSJ) released a series of excerpts from a Microsoft internal memo, where Chairman Bill Gates warned his top executives of the SaaS threat. In these excerpts, Gates called on Microsoft to jump toward the trend of SaaS over the Internet. Some are comparing the memo to his call in the 1990s for Microsoft to embrace the Internet and in the early 2000s to embrace Web services. These calls led to the ubiquitous Microsoft Internet Explorer (IE) browser and Microsoft Service Network (MSN) on-line services, and Microsoft's .NET framework, respectively. Gates also demonstrated a type of "SaaS clairvoyance" in 1998, when he sent a fourteen page internal memo outlining a future, which included what he called a MegaServer, a gigantic server connected to the Internet that would allow on-demand delivery of any type of information to a user from any computer, television set-top box, palm-size personal computer (PC), or other device. A revealing e-mail from Microsoft's chief technical officer, Ray Ozzie, is also about software services, and is especially relevant in light of Bill Gates' memos (http://www.scripting.com/disruption/ozzie/TheInternetServicesDisruptio.htm).

This is Part Three of the four-part Software as Service Is Gaining Ground series.

Now Microsoft includes everything in its SaaS vision, from add-ons to future versions of Microsoft Office, to hosted Microsoft Exchange, to next-generation MSN services. Still, Microsoft's most recent unveiling of Microsoft Windows Live and Office Live ironically did not have much to do with offering Windows or Office as services, and consequently was received merely as a re-branding of MSN consumer services that are already available or under development. In addition to using the Microsoft SharePoint portal technology to support Office Live, Microsoft might tout its experience running enterprise-class services, including Office Live Meeting for Web conferencing and FrontBridge, a managed service focused around e-mail cleanliness. But because those services were obtained through acquisitions, the behemoth cannot point to native expertise in developing enterprise services.

In early 2006, Microsoft plans to release business services linked to internal deployments of Office, targeted at companies with ten or fewer employees. But, it is still unclear how it plans to turn its enterprise-class software into corporate services or how it will offer hosted services for its current collection of Windows Server System and Office System products. At least, the giant has indicated its intentions to bring Microsoft Dynamics CRM (formerly Microsoft CRM) and other business applications into the services fold to combat companies such as Salesforce.com, RightNow, NetSuite, and Salesnet.

However, many other larger vendors initially dismissed SaaS, application service providers (ASP), and other hosted arrangements as lightweight and unsuitable to enterprise-class customers. But they are gradually "reversing course". For instance, Siebel (soon to be part of Oracle) has already offered Siebel CRM OnDemand, which should come in handy for Oracle in terms of its hybrid on-premise/on-demand offering. Additionally, SAP has taken notice of vendors, like Salesforce.com, that are making notable headway in the SaaS market.

SAP's Pragmatic On-demand Approach

Until very recently SAP's SAP Hosting division was not competing directly in this area, since it did not provide a subscription-type service. Instead, it preferred to give cash strapped customers a lower entry cost, giving them the chance to spread out the software cost over a few years through SAP Financing programs. Moreover, SAP Hosting was positioned to provide more complete SAP-centric solutions including operation, application, and infrastructure management.

However, in early February, after nearly a year of flirting with the idea, and in line with its commitment to provide enterprise customers with solutions that meet both current and future business needs, SAP announced it was expanding its on-premise mySAP Customer Relationship Management (mySAP CRM) solution to include an on-demand option. The SAP CRM on-demand solution is designed to allow large and midsize organizations to manage sales, service, and marketing with an easy-to-use solution that is delivered directly via the Internet and is offered through a subscription-based licensing model.

In making the announcement, SAP unveiled its first on-demand product, the SAP Sales on-demand solution, which is designed to help organizations manage their customers, contacts, and sales pipelines with affordable, simple-to-use, and easy-to-configure tools. Available immediately, the on-demand sales solution will be followed by additional on-demand customer relationship management (CRM) offerings, including marketing and service products, intended for release in 2006 in quarterly waves. The SAP Sales on-demand solution is offered to customers on a $75 (USD) per user, per month pricing program based on pre-defined scope. The solution is available globally, with initial language options in English and German. Additional language-specific versions, including French, Japanese, Portuguese, Spanish, and Chinese versions, will be rolled out over the next three months or so.

The SAP Sales on-demand solution enables customers to rapidly meet traditional sales force automation (SFA) business needs, such as account and contact management, activity management, opportunity and pipeline management, calendar and task management, and sales analytics, to help companies better manage new and existing business opportunities, lead generation, sales execution, and client engagement. As expected, these core CRM features are served through a new user interface (UI) tailor-made for sales and marketing users, offering a variety of shortcuts and navigation aids and integration with desktop productivity applications for sales collaboration.

While somewhat late to the SaaS party, and only with basic SFA functionality for the time being, SAP claims to have at least created the first hybrid CRM solution that transcends the on-demand (i.e., immediate deployment, immediate business impact, and fast user adoption) versus on-premise (i.e., strongly customized solutions for differentiation, cross-functional data, analytics, and business processes, with a 360 degree view of the customer) debate, while integrating with core enterprise solutions in both deployment models.

To facilitate this hybrid approach, SAP has introduced the isolated tenancy model, which by having an additional database architectural layer, combines the high availability and low risk of a single-tenancy approach with the efficiencies and deployment speed of multi-tenancy architecture. SAP claims to have thus bridged the gap between single tenancy and multi-tenancy environments, bringing together the best of both worlds to meet the real requirements of enterprise customers today. The vendor acknowledges that customers appreciate the efficiencies of a SaaS model as found in today's niche, pure-play offerings, including speed of deployment, automatic software updates, and central management to help keep costs low. At the same time, customers are seeking the high availability, security, and low risk that come from the isolated and dedicated resources found in traditional hosting or single-tenancy environments. For enterprise customers, the knowledge that their systems' performance and continuous operations do not depend on the overall usage by other customers at any level, including the database level, is particularly important. With its new isolated tenancy approach, SAP hopes to give customers the benefits of centrally-served software, while delivering a level of independence, along with dedicated technology and resources that assure a safe environment.

Thus, though many observers have noticed a lack of functionality even when it comes to SFA (e.g., sales forecasting, lead routing, quotation management, workflow management, price calculation, other formulaic fields, etc.), SAP touts itself as the only provider whose on-premise and on-demand solutions are based on a common architecture, data model, and common UI. This should provide for a transition that is easy to manage, ensure continuity of data and processes, and minimize change management costs.

Another trait that might differentiate SAP is its flexibility, in that, unlike other vendors, SAP will not lock customers into long-term contracts for its on-demand offering. Furthermore, as one would expect (given SAP's larger on-premise install base), the solution was designed from the ground up to integrate (albeit with some tweaking) with enterprise systems, such as enterprise resource planning (ERP) and supply chain management (SCM) solutions, in order to deliver wider business process execution and improve the transparency of customer interaction. The idea behind this is to enable a seamless transition to on-premise deployment when the business is ready for more robust and strategic CRM capabilities. This continuity in customer relationships and adoption should be possible owing to the same data model, consistent user and administration data, consistent customizing and configuration, consistent functionality, and the fact that the UI and database structure are the same between SAP's on-demand and on-premise solutions, which is something that not many competitors can brag about. For instance, the likes of Salesforce.com do have application programming interfaces (API) that support Web services and are simple object access protocol (SOAP) and extensible markup language (XML) compliant, but, given the lack of, for example, an item master in these applications, there are many decisions to be made before truly integrating an order management process into these on-demand CRM applications.

SAP also announced that it has extended its long and proven strategic alliance with IBM in order to provide on-demand application hosting services for the SAP CRM on-demand solution. IBM will supply expertise in helping customers innovate, for example, in how they reap the benefits of their CRM deployments. IBM will also provide safe, secure, reliable, and highly-available hosting services—based on proven IBM eServers and DB2 database technology. The SAP solution will be powered by IBM's Applications On Demand Platform, which automates application hosting and management to provide a scalable and efficient platform for running business applications.


SOURCE:-
http://www.technologyevaluation.com/research/articles/software-as-a-service-for-customer-relationship-management-and-sales-18456/

The Case for Pricing Management

Enterprises have long realized the importance of improving profits by curbing upstream supply chain costs, as evidenced by an increasing strategic approach to sourcing, e-procurement, and contract or spend management over the last several years (see The Hidden Gems of the Enterprise Application Space). However, this broad strategic approach, including education and discipline, has not been applied on the sales side. The kind of thoughtfulness recently seen amongst well-informed and disciplined buyers and purchasing managers has been lacking when it comes to deploying information technology (IT) systems for analyzing pricing processes, pricing optimization, sales force education, and price enforcement in the downstream components of the value chain. Another major deficiency is the dearth of software providers for the management needs of the entire price lifecycle, from price setting, price optimization, and price policy management, to deal execution monitoring, analytics, and reporting.

Justifying the "why" of pricing and profit optimization is fairly easy, since the objective is to increase profits and margins, and hardly anyone could disagree with that objective (see Profit Optimization—Can We Possibly Argue with the Objective?). But the "how" of the optimization is not easy. Although a simple analysis of the profit increase equation may prescribe raising prices, cutting expenses, or simply selling more—and all of these seemingly simple solutions are right in principle—the real problem is far more complex. For example, if one raises prices, will the customers continue to buy, or will they rebel?

On the other hand, if one cuts expenses drastically, will the product quality suffer as a result of resentful, underpaid, overloaded workers, or equally resentful (beaten up) suppliers delivering cheaper but inferior products? Will this drive customers away? Will the consequent warrantee cost increase to the extent that expenses actually rise instead? Moreover, at many companies, there is little cost-cutting maneuver space within operations, given that most enterprises have been watching their procurement costs closely, and evaluating their trading partners. The option of selling more is not simple either, because no one can control customer needs: one cannot know for sure that they will buy more. Some indications show that volumes would have to rise about 19 percent to offset the profit impact of a 5 percent price cut, and such demand sensitivity to price cuts is quite rare. And even if customers do buy more, the question then becomes, can this upsurge in demand even be delivered?

Thus, it appears that raising prices justifiably is the most effective way for enterprises to increase (or maintain) profits in times of both economic boom and slump. While this holds true for most environments, it is particularly true in the razor-thin-margin retail and commodity manufacturing establishments, where prices and availability are the only levers of competitive differentiation. Savvy and dynamically optimized pricing can then mean the difference between survival and failure. The Power of Pricing, the well-known 2003 McKinsey & Co. report, showed that a price rise of 1 percent, at constant volumes of sale and costs, should generate an 8 percent increase in operating profits, which is 50 percent greater than the impact of a decrease of 1 percent in variable costs (materials and direct labor costs), and more than 300 percent greater than the impact of a 1 percent increase in sales volume, even if one ignores the fact that increased production typically increases costs.

It is often not even necessary to raise prices, but rather to make sure that the customer is charged the theoretically right price (or something close to it) at the end of the day. Corporate nominal list price information might be visible in back-office systems, but the trick is to incorporate real-time, transaction specific, on- and off-invoice price adjustments (such as rebates and promotions, consignment costs, cooperative advertising, end-customer discounts, chargebacks, payment terms or cash discounts, online order discounts, performance penalties, receivables carrying costs, slotting allowance, stocking allowance, freight charges, or volume incentives). The real art is in discerning the actual price each customer has been charged per transaction, after accounting for actual deductions, many of which come only after the fact, from the nominal price. Related to this is the notion of the "pocket price waterfall" to display how much actual revenue the enterprises really keep in their pockets from each of their customer transactions, which thereby helps them diagnose and capture pricing opportunities.

This is Part One of a multi-part note.

Looking for the Pricing Rationale

Yet the majority of sales and marketing executives typically still cannot provide short and snappy rationales for where their list and actual product prices come from. Typically, we hear "that is what the market demands." Or else a convoluted business process is described, that at best involves educated pricing analysts who perform detailed financial, or competitive analyses (using variables such as demand, buyer type and preferences, and sales channel characteristics), or any other spreadsheet-based evaluation to conjure up a pricing list, which is then shared with salespeople. This is really when the fun begins, since salespeople will often ignore these lists anyway, and offer products at the price that—according to the salesperson's hunch—customers will pay.

Sales folk only want to sell something after all, given that commissions (sales incentives) are typically not based on profit margins, but rather on volume. In fact, the company may (unwittingly) be losing money on some of these orders. To close a sale, sales personnel typically leverage discounts off the nominal price lists, in order to please their "very important" customers. Thus, often the actual sales prices are a matter of maverick sales practices, horse-trading approaches (meaning shrewd bargaining with reciprocal concessions), or decisions based on the emotion of the moment, all with the handy excuse of appeasing important customers. Typically, it is more productive to the salesperson's personal objectives (higher total commissions) to cut prices than to justify the standard price.

But maybe maverick sales folk are not entirely to blame, given that their superiors themselves let their companies waste millions of dollars in profit and revenue, simply because they cannot really diagnose (or acknowledge) price management problems. Many companies have an unjustifiably optimistic and somewhat imprudent assessment of their price management capabilities, despite their inability to explain their pricing rationale. Also, managers watching over pricing often focus on invoice prices, which are readily available, but revenue leaks (e.g., price waterfalls, such as cash discounts for prompt payments; cooperative advertising allowances; volume-based rebates; promotional programs; freight expenses; and special handling) are spotted with difficulty, as they are unfortunately not detailed on invoices.


SOURCE:-
http://www.technologyevaluation.com/research/articles/the-case-for-pricing-management-18480/

RedPrairie - New Name For A Brave New Value Proposition Paradigm

On November 8, RedPrairie Corporation (www.redprairie.com, formerly McHugh Software International), lately an upbeat provider of comprehensive supply chain execution (SCE) solutions including transportation, labor productivity and warehouse management, as well as supply chain visibility and collaboration solutions, released a new version of its warehouse management system (WMS), DLx Warehouse, containing the specific processing requirements food & beverage and consumer packaged goods (CPG) companies require running on supposedly the cost effective Microsoft Windows 2000 platform. The release has been coupled with RedPrairie's DLx Xpress rapid implementation methodology aimed at enabling swift deployment of food, beverage, and CPG functionality. RedPrairie believes this combination of technology and easy deployment provides competitive advantage and rapid return on investment (ROI) to its coveted smaller customers, and should render it more competitive in the lower-end of the market, below it's traditional radar screen.

The DLx Warehouse/D 6.0 release runs on the Windows 2000 platform using either Oracle or Microsoft SQL Server databases, and it is available with industry-specific deployment packages for Consumer Goods, Food & Beverage, and other environments. For food, beverage, and CPG companies, e.g., the system reportedly has extensive functionality to manage multi-level holds, time holds, catch weights, shelf life, expiration dates, quality assurance, recall processing and many other germane distribution functions.

The news comes at the heels of the November 4 announcement when RedPrairie announced its third consecutive record quarter, despite the continuing slump in the global software market. For Q3 2002, RedPrairie recorded earnings before interest, taxes, depreciation and amortization (EBITDA) of 19%, an almost incredulous increase of 183% over the same quarter last year, and bookings 152% higher than in Q3 2001. With this continued growth, RedPrairie has established itself as one of the leaders in the SCE industry. Fueling the company's record growth and profitability was a whopping 105% growth in software license revenue and total revenue of $18 million, representing a 14% increase from the same quarter last year. The company achieved higher gross margins driven by increasing license revenue and service margins, and a ???$5.0 million in cash generated from operations in the quarter, up $2.5 million from a year ago but, at the same time, it committed an additional 13% to research and development, compared to Q3 2001.

This Part One of a four-part article on RedPrairie.

Parts Two and Three will cover the Market Impact.

Part Four will discuss Challenges and make User Recommendations.

Other Recent Events

Other Q3 2002 highlights would include:

* On September 13, RedPrairie introduced the above-mentioned of DLx Xpress rapid WMS implementation program, based on Six Sigma methodologies, which should enable mid-market companies to affordably adopt an advanced WMS solution. While mid-market companies should now be able to gain the benefits of a WMS solution with a flexible deployment model that can be tailored to their requirements, resources and budgets, the product could still also benefit larger companies requiring rapid implementation schedules due to project timelines. DLx Xpress reportedly combines a streamlined implementation methodology and industry-specific best practice process models. RedPrairie also claims to be the first software company in the supply chain management (SCM) industry to adopt Six Sigma principles as the foundation for its deployment methodologies, which is a widely recognized and accepted approach to achieving process quality and consistency.

* On August 27, RedPrairie released a new version of its warehouse management software, providing third party logistics companies (3PLs) the solution to meet distribution needs across multiple verticals, including Consumer Goods, Food & Beverage, High Tech, Service Parts, Pharmaceutical and other industries. The foundation for this powerful 3PL offering is an enhanced version of RedPrairie's DLx Warehouse solution, which meets wide-ranging distribution and customer service requirements of third party logistics providers (3PLs) and end users across multiple industries.


DLx Warehouse/D 6.0 reportedly offers significantly enhanced functionality to support distribution, transportation, productivity and performance management requirements for customers and 3PLs serving the above industries. The release marks the company's breakthrough, as the first time such broad industry functionality, executed through vertical-specific templates, has been provided through a single suite of warehouse, productivity and transportation management solutions, enhanced with applications for real-time control and performance management.


For 3PLs that need a single system to serve the highly variable distribution requirements of customers across dissimilar industries, this new release might significantly reduce the complexity and cost of operations while enhancing customer service. DLx Warehouse/D 6.0 also reportedly offers enhanced integration to other DigitaLogistix? (DLx) applications, including solutions for:

o Real-time labor reporting and productivity management

o Transportation planning and execution

o Logistics score-carding and performance measurement

o Global supply chain visibility and real-time control

o Pro-active event management and workflow-based resolution.

* On July 12, the company announced general availability of release 6.1 of its DLx Labor software as part of a broader enhancement of its Productivity Management solution that should enable companies to increase logistics productivity, improve performance in areas such as customer service and profitability, and realize more consistent and predictable fulfillment operations. The 6.1 release also includes standard integration to voice recognition systems for hands-free, eyes-free capture of assignment completion times and real-time feedback to users and management on performance metrics, which should drive greater operational efficiency and cost savings through streamlined fulfillment processes and improved labor productivity.

The first application of the voice recognition technology will be the integration of Vocollect's industry leading Talkman system for one of the largest grocery wholesalers and retailers in North America. The release also contains a standard interface to DLx Scorecard, RedPrairie's online supply chain analytics and performance management system, aimed at enabling companies to track and analyze performance metrics such as direct labor hours, indirect labor hours and travel times across multiple facilities in near real time to quickly identify performance problems and take corrective action before they adversely impact efficiency and customer service.



SOURCE:-
http://www.technologyevaluation.com/research/articles/redprairie-new-name-for-a-brave-new-value-proposition-paradigm-16851/

Marcam Solutions: Shifting its Focus to MES

Marcam Solutions, headquartered in Newton, MA, is a global provider of enterprise resource planning (ERP) and enterprise asset management (EAM) software exclusively for process manufacturing enterprises and large corporate divisions. Marcam Solutions was created after the 1997 breakup of Marcam Corporation, a company founded in 1980 that was struggling to manage the business of two product lines that targeted the two completely different markets of discrete and process manufacturing. The dissolution of Marcam Corporation created two new ERP software companies, Marcam Solutions and MAPICS Inc. Marcam revenues in fiscal 1998 were $124.5 million. Paul Margolis and John Campbell founded Marcam (a name derived from their surnames) in 1980 to provide MAPICS installation and customization services. In 1983 Marcam began developing its own planning and control software for process manufacturing companies such as food, chemicals, and pharmaceuticals. The result was PRISM, first licensed in 1987. Marcam went public in 1990 and acquired ShawWare (maintenance management applications) in 1991 and the MAPICS product line from IBM in 1993. Marcam launched Protean ERP software in 1994. In 1995, it formed subsidiary Foresight Software to develop customer interaction applications, and it halted development of a client/server version of PRISM to focus on its similar Protean line. Today, Marcam Solutions offers three product suites for process manufacturers: an AS/400 based ERP package called PRISM, an open platform ERP product called Protean, and an EAM product called Avantis, initially released in 1981 by ShawWare. The PRISM and Protean software suites automate tasks such as resource planning, production model development, and quality control management. Avantis software manages inventories, maintenance schedules, and all related paperwork.

Marcam sells its product primarily through its direct sales force in 19 offices worldwide. The Company also partners with a number of industry-leading vendors including HP, NEC, IBM, and PeopleSoft. By fiscal year end 1998, the Company had approximately 1,400 customer sites in over 40 countries. In 1999, Marcam Solutions was acquired by Wonderware, the factory automation division of Invensys Plc., a global electronics and engineering company with headquarters in London, UK.


Vendor Strengths

*

We believe that PRISM, Protean, and Avantis are leading core ERP products for the Small-to-Medium Enterprises (SME) market segment, particularly due to their deep respective niche functionality (process manufacturing and asset management), low total cost of ownership (TCO), and speed of implementation.

*

Marcam was one of the first mid-market ERP vendors to incorporate concepts of component technology, Internet and e-Commerce, and integration with other vendors' components, all providing for flexibility and ongoing post-implementation system agility. Furthermore, the Marcam product suite can run on the most popular platforms and databases.

*

PRISM and Protean have long exhibited certain plant-level features (e.g. the ability to track the status of product throughout the production process, and finite scheduling) in addition to performing a standard range of ERP business functions. Moreover, the envisioned integration with Wonderware's FactorySuite 2000 will allow Protean users to solve shop floor problems with all production data collected and made instantly available.
Vendor Challenges

*

Marcam has struggled financially for over four years, (see Fig. 1 - Marcam Solutions Inc. - Annual Results Chart) and the trend of decreased revenues and loss reporting continued throughout 1999 (see Fig. 2 - Marcam Solutions Inc. - Quarterly Results Charts), leading to the Company's acquisition for the price less than a half of its annual revenue ($60 million).

*

Marcam is confined to the process manufacturing market and does not support discrete manufacturing. In addition to this, PRISM and Protean lacked financial and distribution functionality until late 1998, which forced the Company to seek product interfacing partnerships. This has resulted in a number of lost opportunities, since certain customers have opted for more complete solutions from a single vendor. Moreover, the Marcam product suite still lacks a strong CRM, SCM, and HR product offering.

*

While the merger with Wonderware brings the positive prospects referenced above, we believe Marcam's future as an ERP vendor is uncertain due to its future need to blend a variety of different core competencies, and its possible shift of focus towards plant integration applications. We expect the situation will become further aggravated with product integration issues.


SOURCE:-
http://www.technologyevaluation.com/research/articles/marcam-solutions-shifting-its-focus-to-mes-15233/

A Lexicon for Customer Relationship Management Success

The customer relationship management (CRM) industry is approaching a ten year anniversary. Despite its longevity, there continues to be a pervasive sense of dissatisfaction within the end user community relative to CRM's perceived delivered value. There are three fundamental factors contributing to this:

1. The industry fails to articulate a clear picture of the value it provides outside of the feature/function attributes of the technology.

2. Senior management (user organizations) view CRM in terms of infrastructure deployment instead of in operational and strategic terms.

3. Because the user community fails to approach CRM as an operational strategy, its perceived value is limited to technology efficiency. User organizations must move beyond technology and process productivity to properly assess the system's potential. Only then, can the vendor and user communities establish meaningful discussion about value.

The industry does itself a gross disfavor by using tired and essentially empty terms when discussing the application of CRM. The rate of technology development has largely outpaced the development of management techniques to effectively use the technology. Vendors base their pricing on the level of sophistication their product has, but end users balk because they are unable to leverage a solution's capabilities. As a result, users do not assess the added value highly.

It is time for the CRM industry to more accurately articulate the implied value proposition of their solutions and for senior management to take a leadership position and articulate a true CRM operational strategy. Without these two forces coming together, CRM will be forever relegated to a position of infrastructure and will become one more footnote in the history of failed management concepts.

The Issue

The motivation to write this article was spawned by two recent articles. The first article was based on a survey of CRM experts who explained why they believe CRM initiatives fail. Although some of their comments were refreshingly accurate, there were a number of references to tired old phrases that do little to improve understanding of the real issues and opportunities associated with CRM. The second article was based on a survey of chief executive officers (CIO) about their satisfaction with CRM applications. The survey reported a rather low level of approval and cited various technology and productivity deficiencies. These two articles are representative of the disconnect between galloping technology and the inertia of many organizations to change their operating paradigm. The continued use of empty phrases and the emphasis on implementation as opposed to strategy is not going to help narrow this gap.

The Genesis of CRM: The Perfect Storm

CRM, as a technology, started as a software marketing strategy. The concept was to create a common database between customer service and sales force automation (SFA). The SFA industry picked up on this idea and soon there was massive consolidation among SFA, customer service, and field service software providers. Each vendor (left standing) claimed to have an integrated set of capabilities and the phrase customer relationship management became a bi-word in the world of technology.

On a separate path, Peppers and Rogers (currently a strategic division of Carlson Marketing) popularized "one to one marketing" which established a marketing component in CRM. At the same time, the dot-com era was born and the idea of tracking consumer behaviors at the click level materialized, giving rise to real time marketing. The rush for customer data was soon followed by the realization that there was an ocean of data with few tools to ferret out actionable information.

Since the beginning of this "perfect storm", there has been a quantum leap in CRM tools, but there has been a distinct lag in the management rationale to keep pace. This new set of tools provides the means to integrate the actions of sales, marketing, customer service, helpdesk, field service, and web site design; and it is a way to interface with partners. However, part of the problem is that this spans an enormous amount of resources and responsibility. Since most organizations are structured by function and basically compete for limited resources, each function has a different view of performance, and of CRM for that matter. Therefore, CRM installs have historically involved functional deployments and there has been some success in this approach. The advantage of limited deployment is that it is more manageable in terms of scope and accountability. However, the real leverage for CRM is at the enterprise level.

Key Terms and Phrases

The following terms and phrases are not necessarily inclusive or exhaustive; rather, they illustrate the need to be more precise in our language. From an industry standpoint, there is a need to use terms in a general way, but when it comes to the end user community, the lack of definition generates missed expectations and leads to failure. This discussion is presented to help organizations to better understand these needs and, in some cases, as an admonition to the industry to refrain from using terminology that does not add value to the user community, and as a result, is destructive to the long-term health of the industry.

Customer Relationship Management (CRM)
From the moment of inception, CRM has been defined in a hundred different ways. Since the industry is technology based, definitions tend to revolve around the capabilities of the technology. Gartner was among the first research organizations to effectively argue that CRM is a business strategy and that technology is an enabler. This is where the industry is stuck today: how to describe this management strategy? Some practitioners describe the focus as one of competitive advantage (a state), whereas more common terminology is customer centric (an organizational value).

Being Customer Centric/Customer Driven
"Customer centric" and "customer driven" represent terminology that is a politically correct way of suggesting that perhaps the organization should pay attention to the customer as opposed to itself. It infers that the organization should

* Not take customers for granted
* Ensure that they are satisfied
* Monitor their behavior
* Consider internal actions in the context of how they will be perceived by the customer
* Recognize that customers have options

All of these inferences are reasonable as value statements, but success will never be generated by senior management adopting a strategy to become more customer centric. What does this mean operationally? The rank and file are all too aware of the contention between functions, and policies designed to mitigate risk, but really drive customers "up the wall". For example, return product procedures can be ponderous to customers and cause them to alter their purchasing patterns in a manner that reduces total net revenue. Creating a unified and cohesive customer experience requires organizational change and the mantra of "customer centricity" is not going to unify or create a sense of urgency that will impact the inertia of the status quo.



SOURCE:-
http://www.technologyevaluation.com/research/articles/a-lexicon-for-customer-relationship-management-success-19396/

Business Process Analysis versus Business Process Management

Talking to end users reveals that there is confusion in the market regarding business process analysis (BPA) and business process management (BPM) suites. Vendors use the term BPM in a very broad way, but what are really the differences between BPA and BPM, and where does BPM come from?

BPM in the Early Stages

In the 1980s, organizations used business process redesign (BPR) to improve productivity, quality of service, and cost effectiveness by making drastic changes within the processes of their organizations. Information technology (IT) solutions for these major redesigns were viewed as often resulting in major employee cuts, due to the fact that many businesses used BPR to restructure their company. Because of this, many organizations today are hesitant about implementing business process changes. This is particularly true when it comes to current BPM solutions, which focus mainly on lowering cost and increasing productivity, just as the focal points of these solutions in the 1980s were on drastic organizational changes.

In retrospect, the BPR approach of trying to change everything at once seems a bit extreme. Therefore, current BPM solution providers market a more subtle approach, in which changes are incremental and less drastic than with the old BPR tactics. Nonetheless, there are times when a more radical approach to process modeling and redesign is called for in order for an organization to position itself differently in the market. Moreover, businesses have a tendency to change certain processes rapidly. This is not a problem, as the new BPM solutions are capable of adjusting the process design accordingly, without having a huge impact on the company structure. Thus, even though the BPM strategy operates through incremental changes, businesses will notice the positive impact these changes effect within an organization.

Another huge difference between the BPR of the 1980s and the BPM of the present is the fact that BPR involved hard-coded process changes. Organizations not only needed programmers instead of business users to implement these changes, but they were time-consuming. Technologies for process automation, document management, etc., were independent of each other, and could only be integrated through coding. This made integration more difficult than it is now, resulting in it often not being used at all.

When pure-play BPM vendors arrived on the scene, they created a product whose components were already integrated with each other to form one cohesive solution. These vendors focus on the business side of the organization, creating a user-friendly interface, and involving business analysts in the entire cycle of process modeling and implementation—not just in requirements gathering and user acceptance testing. This means that business users can apply changes more efficiently without relying on the IT department, because changes are not hard-coded and usually do not require programming skills.

What Is Business Process Modeling and Design?

Before an organization starts the design or modeling process, it needs to understand what its business processes are. In general, a business process is a set of logically related business activities that combine to deliver something of value. A business process can be seen as different steps within a business cycle, but also as a set of steps or activities that run throughout the organization, and which are often built to the requirements of the customer. In this case, the customer is a different department, the actual end user, or a product in the next process within the workflow.

When it comes to specific business processes within an organization, business analysts should look beyond departments. Departments are often divisions or silos within an organization, but business processes lie on top of these departments. For example, selling to a customer is typically viewed as a single business process, but several departments, from the sales department to the distribution and finance departments, are involved in this single process.

There is a good reason why BPM solutions handle processes in this way, as horizontal rather than vertical or "functional" processes. If an organization views its processes vertically based on functions, the process is isolated. This can cause delays, increased costs, and duplication of tasks, as well as loss of quality control. Horizontal processes, on the other hand, cross the boundaries of departments. They focus more on human-centric processes ("who does what," in other words) than on task-centric processes (which take things step by step).

In terms of modeling and designing these processes, the main drivers for most organizations are optimization, effectiveness, organizational growth, and customer satisfaction. In fact, the most common ideas behind business process modeling and design are as follows:

* performance improvement
* cost reduction
* business process automation
* business process integration
* business opportunity creation

Business process modeling and design is more than just another project for an organization. Organizations should see business process modeling and design as an actual business change that will help it to meet or redirect its scope, and to continuously meet its customers' requirements and expectations. Business process modeling can include organizational changes, technical changes, or frequently a combination of both.

BPA as a Stand-alone Solution

Besides vendors that provide full business process management suites (BPMS) as discussed below, there are vendors that focus more on the modeling and analysis than the actual execution of the processes. Their solutions are called BPA tools. BPA solutions concentrate on process design and the associated business model analysis. Integration, performance, support, and ease of use are important for BPA solutions, as are the two modules described below.

The business model designer is a module that enables business users to visualize the business processes within an organization. This permits the identification of bottlenecks, tasks, and opportunities, so that business users can automate these processes. Module features such as graphical process design, validation of processes through checkpoints, and the inclusion of icons in the processes, improve process visibility for business users. Moreover, with the business model designer, it is possible to take a top-down approach to process modeling by starting with a high-level business process and drilling down to more detailed processes within the organization. This module also provides a communication method for business users to talk to people in more technical departments, such as system integrators.



SOURCE:-
http://www.technologyevaluation.com/research/articles/business-process-analysis-versus-business-process-management-18754/

Enterprise Application Integration - the Latest Trend in Getting Value from Data

Enterprise Application Integration (EAI) is one of the hot-button issues in Information Technology in 2000. Information Week's research survey of 300 technology managers showed nearly 75% of respondents said EAI is a planned project for their IT departments in the coming year. According to a study by Bank Boston, the market for EAI is expected to be $50 Billion USD by 2001.

Successful EAI requires a careful combination of a middleware framework, distributed object technologies, and custom consulting. Many vendors have evolved out of the middleware space, and some are coming from the Extract/Transform/Load space. It remains to be seen what approach will provide the most value for a new EAI product. Many of these products are refashioned middleware tools.

Vendors are attempting "out of the box" solutions, but there is immense complexity involved in integrating applications, particularly extended supply chain, e-commerce, and customer relationship management/sales force automation. The key to the entire puzzle is in the architecture of the integration, which must be carefully examined before any implementation is attempted.

EAI began at Goldman Sachs in New York nearly 10 years ago, where they funded the Teknekron Information Bus (TIB) to pump stock market quotes into different systems. The programmers who wrote Teknekron then left and founded TIBCO. Many of those same developers are now with Vitria.

The basic components required to achieve EAI are the following:

Business Rule Component: to allow the applications to understand your business processes

Business Logic Modules (i.e. supply planning, sales order processing. Methods for business process management.)

Transformation tools (to define how to map data from one system to another)

Data Acquisition Component: to allow access to the data

Data Source and Target Interfaces (i.e. Siebel, SAP, PeopleSoft, ODBC, Oracle, CICS, IMS) - note that the data acquisition component is crucial to EAI success. Most vendors refer to these interfaces as "adapters" -

System Development Component: to allow programmers to design and test custom requirements -

Design tools (for business process design, debugging, and testing)

A published API (Application Programming Interface) to the product so custom extensions can be written as needed

System Control Component: to allow the application to be monitored and controlled

Management tools (for application-specific monitoring), preferably with support for the Simple Network Management Protocol (SNMP) via a vendor-supplied SNMP agent

Directory tools (for locating other applications on different platforms), particularly support for the Lightweight Directory Access Protocol (LDAP)

ommitment control management mechanisms (for control of business-level logical units of work)

Strong support for metadata management, preferably distributed and bi-directionally synchronized

Message Brokers (to control transactions, control security, and perform event notification, i.e. IBM's MQSeries, or Microsoft's MSMQ for Windows NT). The product should also include the capability to "bridge" messages between different messaging systems (i.e., an IBM MQSeries mainframe application that needs to communicate with a Microsoft MSMQ application on Windows NT)

Scalability for high-volume transaction throughput. We cannot put enough emphasis on attention to scalability. It is almost impossible to know at implementation time what the data volumes will be in the future

Support for varying levels of fault tolerance, load balancing, and failover for mission-critical systems

Workflow enablement (via SMTP, publish/subscribe capabilities, etc.) is a key requirement to reduce latency between distributed processes. The product should also have links to workgroup products such as Lotus Notes

System Access Component:

A Web-based portal for transparent, integrated information access

The ability to work both inside and outside the corporate firewall

To attempt to explain EAI, an understanding of data-oriented middleware is necessary. In addition, the "portal" concept must be explained, as the web is the standard front-end to these distributed technologies. The topology of this type of application can be split into two parts; the first is the middleware that connects the disparate data sources, the second is the business logic that provides a unified view of the data. Given the complexity of this solution, consulting is required to integrate all the pieces, as there is no "out of the box" solution that can provide plug-and-play integration.

Much consideration must be given to the coupling of time and process. There are three basic communication types which may be required for the middleware solution:

Asynchronous: provided by products such as IBM's MQ Series, used in situations where the communicating applications don't need to be active at the same time. This allows applications to be "loosely coupled in time". An example of this would be a terminal application feeding a batch process.

Synchronous: provided by OMG's CORBA and Microsoft's COM, used where the business logic requires that the applications communicate in real-time. The requesting transaction waits until it receives the result set from the other application.

Transactional: using transaction monitors such as IBM's CICS or BEA's Tuxedo. This is required where the logical unit of work (defined as one business transaction) spans multiple systems.

The last major requirement for an EAI system is security, typically in the form of single sign-on (to provide access to all the required data without multiple passwords.) Using EAI provides a business with the ability to consolidate "stovepipes" of information from various transactional, legacy, relational, and other sources into a unified and secure view.

An additional challenge is the need to rationalize the data in the different data sources. For example, the definition and datatype of the "customer" field may vary from one database to another. These dimensions need to be conformed in order for any meaningful integration to take place. The integrator must also take into account how "real-time" the application's data needs to be. Event-based synchronous communications can be difficult to define, usually requiring database triggers or database log analyzers. When the data source is not a relational database (i.e., a text file), this process can become extremely complicated.


SOURCE:-
http://www.technologyevaluation.com/research/articles/enterprise-application-integration-the-latest-trend-in-getting-value-from-data-15210/

Invensys Production Solutions - Can Historic Strengths And The 'Protean Boost' Overcome Its Liabilities?

Recently, after a lengthy and painstaking soul-searching exercise, Invensys plc, the global automation and controls group with headquarters in the UK, created a new group within its Production Management Division (PMD) called Invensys Production Solutions (IPS) (www.invensysproductionsolutions.com). The group will include the PRISM and Protean process ERP products plus the resources of Invensys Validation Services group (www.vtc-usa.com), a Montreal, Canada-based provider of regulatory compliance, validation, and consulting services encompassing the entire validation project life cycle and a range of validation services for the regulated supply chain.

While the newly formed unit should have much strength, since the PRISM and Protean products contain functionality that at least challenge the leading products in the process manufacturing arena, it also has liabilities that must be addressed, in a great part because existing users of its above solutions have suffered from frequent product strategy changes as a result of vacillations by the Invensys parent company.

In the past three years, Invensys process solutions' customers have experienced the displeasure of witnessing several radical changes of strategy, causing some of them to begin to seriously doubt the vendor will ever deliver their market-specific product capabilities. In July 1999, Invensys bought the outstanding shares of then struggling Marcam Solutions, and folded it initially into its Wonderware factory automation division. Further, in August 2000 Invensys acquired then also languishing Baan Co. (see Baan Yet Another ERP Vendor to Find a Sanctuary Under Invensys' Wing) and made it a part of the former Invensys Software Systems (ISS) division.

The initial strategy for the products, which was announced after the Baan acquisition was to release a unified Baan product that combined functionality for discrete and process manufacturing (see Process ERP Market Loses PRISM and Protean). After hearing existing customers' less-than-pleased feedback and after another reconsideration of its past investments, Invensys then modified that strategy to one of creating the Baan Process division (see Invensys Announces New Division - Baan Process) which included five process ERP products coming to Invensys through Marcam and Baan acquisitions: Baan IV Process, Baan Dimensions, PRISM, Protean, and Baan Cable & Wire. The announcement was a departure from rewriting all the products into one core iBaan ERP product the unit was not going to provide an integrated solution any longer, but would rather provide combined applications capabilities via an integration framework.

Finally, given Invensys has recently yet again put all its assets/investments under the magnifying glass, it has now allocated the PRISM and Protean products into their own profit-based division, called Invensys Production Solutions. Sanjay Razdan will be the newly formed group leader, and will be responsible for the development, marketing, sales, and support of the Protean and PRISM process ERP software solutions and the Invensys Validation Technologies. By joining the Invensys Validation Technologies group with PRISM and Protean, IPS should be able to offer enhanced regulatory compliance solutions for the process and regulated industries. Validation Technologies has been a part of Invensys Pharmaceutical Solutions, another group within the Production Management Division of Invensys, and one of the leading suppliers of validation, pharmaceutical, engineering, and regulatory-compliant solutions. Founded in 1994 and with over 110 dedicated consultants, the group is currently one of the largest suppliers of regulatory-compliant solutions in North America and Europe, dedicated to the pharmaceutical, biological, biotechnology, and medical devices industry.

Given the Baan product line focuses on the discrete and hybrid (with only simple process requirements) manufacturing sectors, this move should enable both organizations to fully leverage their strengths in their respective industry sectors. Under the new setup within Invensys PMD, well over 80% of revenues will now likely come from process industries, since, in conjunction with solutions provided by sister Invensys companies such as Wonderware, Avantis, Foxboro, Eurotherm, APV, and Powerware, Invensys Production Solutions also provides a broad set of capabilities for the process sector. Thus, Baan might now be singled out as the possible discrete manufacturing black sheep' in the family, causing Invensys to likely occasionally review the carrying value of its investment in Baan. Still, while Invensys does not plan to integrate iBaan ERP functions with PRISM and Protean, it does plan to leverage Baan's collaborative supply chain management (SCM) or customer relationship management (CRM) software, using Baan OpenWorldX enterprise management level integration framework, which, together with the ArhestrA framework at the plant automation level and Production Engine (PE) framework at the production management level, still represents a part-and-parcel of the Invensys Real Time Enterprise (RTE) framework (formerly referred to as the "sensor to boardroom" strategy).

This is Part One of a two-part note.

Part Two will address Invensys Liabilities and Strategy and make User Recommendations.

Historic Strengths

The company, although constantly morphing from Marcam to IPS, has a good track record and a heritage of selling solutions to manage divisional or autonomous plant sites within selected process industries. The products are very strong in plant level management functionality, given the IPS' progenitor, former Marcam Solutions, headquartered in Newton, MA, was one of the first global providers of ERP and enterprise asset management (EAM) software exclusively for process manufacturing enterprises and large corporate divisions. Marcam Solutions was created after the 1997 breakup of Marcam Corporation, a company that had struggled to manage the business of two product lines that targeted the two completely different markets of discrete and process manufacturing. Namely, the dissolution of Marcam Corporation had then created two new ERP software companies, Marcam Solutions and MAPICS Inc. (NASDAQ: MAPX), the latter of which is still going strong in its original form.

Paul Margolis and John Campbell founded Marcam (a name derived from their last names) back in 1980 to provide then IBM's MAPICS ERP product installation and customization services. In 1983 Marcam began developing its own planning and control software for process manufacturing companies such as food, chemicals, and pharmaceuticals. The result was PRISM, which was first licensed in 1987. Marcam went public in 1990 and acquired ShawWare (maintenance management applications, whose Avantis product is now a part of a different unit within Invensys) in 1991, and the MAPICS product line from IBM in 1993. Marcam launched Protean ERP software in 1994, and during 1995, it all but halted major development of a client/server version of PRISM to focus on its similar but technologically more advanced and seemingly more prospective Protean line.

The PRISM and Protean software suites both automate tasks such as resource planning, production model development, and quality control management. Marcam sold its product primarily through its direct sales force in close to 20 offices worldwide. The Company also partnered with a number of industry-leading vendors including Hewlett-Packard, NEC (as a reseller and a developer of earlier versions of Protean in the Japanese market), IBM, and PeopleSoft, to name some. Marcam Solutions had approached its financial management functional gap by partnering and offering warranted integration to major financial applications such as SAP R/3, PeopleSoft and CODA. By 1999, the Company had approximately 1,400 customer sites in over 40 countries before it was acquired by Invensys' Wonderware division.

As mentioned earlier, the PRISM product is a veteran of the Process ERP market with many considering it the pioneer in this segment, and it can arguably be called the most widely installed plant-level process ERP product available. The company claims that 100% of its 1,200 sites (i.e., with its own server unit) are running plants with many installations running multiple plants, given these sites originate from little over 600 corporate customers. IPS' management estimates that PRISM currently has over 85,000 users worldwide, out of total 100,000 users for both products together.

SOURCE:-
http://www.technologyevaluation.com/research/articles/invensys-production-solutions-can-historic-strengths-and-the-protean-boost-overcome-its-liabilities-16954/

A Customer Relationship Management Solution Aims To Cover all the Bases

Company Information

Surado Solutions Inc., founded in 1995, is a privately held company based in Riverside, California (US), and offers a suite of customer relationship management (CRM) solutions.

Surado aims to provide a complete CRM suite, rather than a modularized solution targeted towards departmental delivery. Its goal is to build full-featured, integrated, and multifaceted systems, as well as out-of-the-box solutions. The vendor is a Microsoft Certified Partner and Microsoft Business Solutions Certified Gold Partner, and uses the Microsoft Solutions Framework (MSF) as the foundation for its product development. It also touts the merits of the Six Sigma methodology and Design for Six Sigma (DFSS) as quality improvement philosophies.

Surado targets the small and medium business (SMB) market, namely organizations with annual revenues of $1 million (USD) to $1 billion (USD), and approximately 88 percent of its clients fall into this category. To reinforce its position in this market segment, Surado offers Surado Small Business CRM 5.0, designed for ten users or less. Surado Small Business combines the core Surado CRM suite (Contact & Account Management, Sales Automation, Marketing Automation, and Customer Service/Help Desk) with Integration for Exchange (for e-mail, contacts, and tasks), the Surado Integration Module (for connecting to third party databases or creating custom tables and screens), and Surado CRM Web (a web interface for remote user access to basic functionality.

Although Surado CRM is not vertical-centric, it enjoys a wide installed base in traditionally "vertical CRM"-dominated industries, such as technology, health care, education, banking and finance, and government. The vendor has customers in all fifty US states and in over sixty-four countries worldwide. A sampling of its top clients from those vertical industries includes Blackbox, County Regional Medical Center, California State University, Georgia Student Finance, and the City of Riverside Economic Development Agency.

We'll analyze Surado CRM 5.0 from the perspectives of core CRM functionality, look at some of its distinguishing factors, and discuss some of the challenges users may face when considering Surado CRM for small to midsized businesses.

Core Functionality of Surado CRM 5.0

Core CRM functionality covers five aspects:

* contact and account management
* sales management
* marketing management
* customer service and support
* integration

The figure below is a TEC-created table comparing Surado against other vendors and their offerings. Surado performs above other vendors in the areas of marketing automation, sales force automation, customer service and support, and partner management. In the areas of contract management and creation, and project management, Surado's performance is above average, but below the highest-rated competitor.


Contact and Account Management
This area of CRM typically displays and manages detailed account information, such as information related to the company, contacts within the company review of past activities and history, scheduling, and task management.

This module offers a unified interface for account and contact management functionality, where users can review past communications, upcoming activities, sales opportunities, quotes and purchases, support issues, links to relevant documents, and information from back-end systems. In addition, Surado CRM also captures all customer communications, whether through phone, e-mail, fax, the Internet, or personal contacts. A fully integrated workgroup scheduling and task management features the ability to track activities, participants, and resources, including pop-up reminders. A relationships tab also allows users to track the important relationships that may exist between two or more contacts in the system that otherwise might otherwise be overlooked or poorly managed.

Sales Management
This area of a CRM solution focuses on managing sales opportunities and processes. It provides the features and functionality to define, implement, manage, and execute one or more sales cycles, based on individual opportunity types. This allows users of Surado CRM to configure the system to better fit their unique needs rather than having to conform to a generic sales cycle supplied by the system.

The module includes the basics: contact information, correspondence, opportunity and forecasting data, literature and presentations, quotes, orders, and post-sale service history.

Surado CRM 5.0 allows for multi-source data import from lists, or captured leads from a web site through its eLeads module. It also allows inquiry tracking and intelligent leads routing. Automated process can be initiated to distribute literature, schedule follow-up activities, and set conditions to advance opportunities. Managers can use Surado CRM to monitor team activities across customized sales stages across multiple product pipelines. Sales positioning features and functionalities are also available through competitive intelligence analysis and customer analytics, to identify habits, trends, and potential.

Marketing Management
In this area of CRM, the key components to attracting and retaining a customer base are evaluation, design, implementation, and execution of marketing initiatives.

The application can track the results of advertisements, direct mail, and telemarketing, and help design, execute, and manage personalized, permission-based campaigns. Surado CRM 5.0 also allows for the planning, design, execution, and management of multichannel permission-based marketing campaigns. Users can assign tasks and responsibilities according to revenue projections, campaign periods, targeted audiences, and channels. Potential deployment issues can be identified, and resources re-allocated. E-mail and fax campaigns can be set up for automated execution and follow-up.

Surado CRM provides for campaign return on investment (ROI) analysis as a means to track the effectiveness of marketing campaigns, by comparing potential and actual responses and sales.

Customer Service and Support
This area of a CRM solution is where customer service inquiries and support issues are entered, tracked, and in specific cases, escalated to resolution.

Surado CRM 5.0 features a customer service, help desk, and support knowledge base, with keyword searches. It also provides an integrated system that coordinates and tracks customer interactions across multiple contact points to address customer inquires.

Surado CRM automates support and help procedures, by automatically converting incoming e-mail messages into support tickets (including attachments), responding to support tickets, and notifying customers of soon-to-expire service-level agreements (SLAs). It also handles routing, load balancing, escalation based on multiple criteria, automated response, and ticket updates and deletions.

In addition, Surado's Web Self-Service module provides a channel for clients to access an Internet knowledge base search as well as conduct self-service ticket submission and review.

Key metrics are displayed in graphical form, and can provide managers with the information necessary to make rapid decisions regarding re-deployment of resources to the most urgent support areas. Performance gauges (such as support metrics by urgency, touch point, area, type, and support groups) provide managers with the opportunity to act quickly to prevent potential bottlenecks in providing support. Finally, color-coded alerts for events that fall outside defined parameters provide managers the ability to take a proactive approach, preventing escalation of support issues.

Integration
While integration is not traditionally considered to be a functionality, it is nonetheless a critical component of any solution, and needs to be given the same level of consideration as core functionalities. Surado CRM 5.0 is very well designed to run on a Microsoft platform (including operating systems and applications, SQL databases, and Exchange servers), and integrates tightly with front-office programs (Microsoft Office, Outlook, and Project, as well as with mobile devices, scanners and business intelligence [BI] tools) and back-office applications (Great Plains Accounting). Surado CRM 5.0 has also enhanced its level of integration with Intuit QuickBooks. This is in alignment with Surado's focus on the SMB market, where such systems are widespread.

With the optional add-on Surado Integration module, back-office applications like financials, enterprise resource planning (ERP), supply chain management (SCM), logistics, manufacturing, shipping and delivery, human resources, e-business, and industry-specific applications can be integrated to give users a unified view of the disparate back-office application environment within a centralized CRM solution. This module also allows system administrators to create unlimited custom detail data tabs to display information from back-office applications directly from within the Surado CRM solution. Finally, administrators can also create stored procedures to automatically write Surado CRM data into other databases using automatic data exchange (ADX).



SOURCE:-
http://www.technologyevaluation.com/research/articles/a-customer-relationship-management-solution-aims-to-cover-all-the-bases-18676/

Software as a Service beyond Customer Relationship Management and Sales

Despite the fact that this seems to be the focus of Microsoft's, SAP's, and even Salesforce.com's software as a service (SaaS) initiatives, surveys conducted by renowned analyst houses suggest that the more widespread use of technology accessible services through a Web browser is not necessarily centered on customer relationship management (CRM) or sales force automation (SFA) solutions, which focus on sales leads and customer targeting. Rather the technology is being used to share information and collaborate. The fact is that most enterprises have thus far invested tremendously in information technology (IT) support for administrative processes, whereas there has hardly been any investment in support for non-routine, cognitive information, which is of paramount importance for business decision makers, service and product innovators, and other staff members, who increasingly create the competitive advantage for the business. The tasks performed by these people require a mix of technologies, not just new technology. Users need access to unstructured data, unstructured content, and collaboration support. Yet, most collaborative teams have e-mail as the only mechanism of information exchange among knowledge workers. This is incredibly inefficient and can become increasingly overwhelming—to the point of becoming a negative productivity tool. For example, for anyone trying to collaboratively design a new aircraft and source its parts and assemblies, or manage a thousand scientists around the world working on a new drug, e-mail is a far cry from being an ideal tool for knowledge worker collaboration. Also, many smaller enterprises may need as much functionality as their larger brethren, making offering enterprise-level functionality via the SaaS model necessary, but also even more challenging. Given their enterprise resource planning (ERP) or accounting origins, the recent successes in the market of NetSuite and Intacct might vouch for this need.

In fact, applications are more often outsourced than infrastructure, and this is increasingly done through SaaS. These applications include travel services, human resources (HR) management (personnel, benefits, and payroll, from vendors like Taleo, Employease, Kronos, Ultimate Software, etc.), and billing and payment processing. Business to consumer (B2C) e-commerce and product catalogs are also delivered through SaaS. This includes dynamic pricing models, customer loyalty groups, targeted sales promotions, and other sophisticated sales tactics, as well as integration with other supply chain applications, those which do not necessarily need a large internal team of sales support people. Financial, tax, procurement, and customer service management have also followed suit. Companies are choosing to promote SaaS-based strategic sourcing and procurement applications ahead of well-publicized CRM deployments for a number of reasons, including, globalization, Web-based collaboration, manufacturing outsourcing in far-flung regions, and distributed order management (DOM).

Quiet SaaS Leaders

Given this focus on information and collaboration, WebEx may very well be a leader in SaaS. Many of us have used the services of this on-line conferencing pioneer many times, but would not identify it as an SaaS leader. However, it should be straightforward to see how the multiple aspects of Web conferencing lend themselves well to the SaaS model. It moves well beyond shared presentations, workspace, and applications, and is supplemented by instant messaging (IM) and integrated with video and audio conferencing, often using voice over Internet protocol (VoIP) technology to bring the whole experience to the personal computer (PC). All of these features and benefits are available without purchasing, implementing, or managing a stack of hardware and software that is only used on occasion. Aside from e-meetings and presentations, another important use of WebEx is remote training, for example for regulatory compliance or IT support, as this reduces travel and increases business productivity.

WebEx uses a multi-tenant architecture, and the same core application serves every customer. Consequently, it is a far more stable business model than first-generation application service providers (ASP), which hosted specific instances of applications for each customer. The vendor also lets partners self-brand its WebOffice collaboration service, which offers group calendaring and scheduling, bundled with messaging, white boarding, and IM. WebOffice can also be billed directly from WebEx, typically for $10 (USD) per user, per month. It is thus not surprising that WebEx reportedly served its 14,000 customers with 2.2 billion on-line minutes in 2004. Moreover, approximately 60 percent of those conferences involved people from more than one organization.

While the market might have heard of Arena Solutions, which has long been offering an on-demand product lifecycle management (PLM) solution (see On-demand Product Life Cycle Management: Not Just for Small to Medium Businesses Anymore), a lesser known SaaS provider is Webcom, Inc. Webcom offers software solutions that simplify the quote-to-order process for the sale of complex products and services, such as those offered by Rockwell Automation, Motion Computing, Cray Computer, General Electric Industrial Systems, and ABB. Requiring only a browser, its solution, WebSource CPQ, allows customers to configure, price, quote, and ultimately propose their offerings across multiple sales and distribution channels, including customer self-service in a B2C setup, virtually at any time and anywhere. The software not only handles the traditional bill of material (BOM), routing, and diagram generation tasks frequently associated with product or engineering configurators, but also addresses the guided selling, proposal generation, and multilevel channel management tasks associated with sales configurators (for more information, see CRM for Complex Manufacturers Revolves Around Configuration Software).

Webcom touts that its software solutions provide the same level of depth as the on-premise peer products from Cincom Systems, Oracle, Trilogy, Selectica, Firepond, Big Machines, Access Commerce, etc., but without the highly involved and lengthy implementations typically associated with implementing these products on the customer site. One should, however, note that some of these competitors have been AppExchange participants, which indicates they also have SaaS prowess. The CPQ product, nevertheless, represents one of over thirty new partner-developed applications available via Salesforce.com's AppExchange (and linked by Web services), and it lets customers augment the base Salesforce.com functionality for more complex configurable product sales processes. Earlier in 2005, Webcom also joined the Siebel Alliance Program as a CRM On Demand Software Partner.

The Apple of the SaaS Market?

Another vendor has also caught our eye recently. MCA Solutions, the provider of the Service Planning and Optimization (SPO) suite of solutions, which helps companies in industries ranging from aerospace and defense (A&D) and semiconductors to industrial and medical equipment improve asset utilization and customer support, made a notable announcement in November 2005. It announced the availability of its SPO On-Demand solution, offering user companies one more way to gain access to its best-of-breed service parts planning solution. Generally available, the on-demand version is reportedly already helping some MCA customers across the high technology, telecommunications, and semiconductor industries reduce inventory, increase fill rates, and improve customer satisfaction.

As MCA recently closed a couple of hosted deals, interest in the vendor does not appear to be waning, as it has for many other prospects. This is no surprise, given the hosted software is faster to implement (in several weeks only), reduces the upfront hardware and software capital expense, and minimizes IT resistance to new software solutions. The announcement also means that smaller companies like Tellabs can now enjoy the benefits of software capabilities that larger companies like Cisco Systems are also using.

MCA's original, on-premise SPO suite is a Web-based suite of advanced inventory planning, forecasting, and execution solutions that gives companies the ability to manage and monitor inventory levels of mission-critical materials by providing global, real time visibility throughout the extended service supply chain. As commercial software devised to optimize assets in a multi-echelon service supply chain network, it supports these collaborative processes by linking the ERP and CRM systems of a user's company.

Simply put, the software supplies inventory forecasts based on the customer installed base, provides contract coverage analysis, and determines where to position spare parts most effectively to meet customer service requirements (i.e., it suggests the optimum stock levels and location for spare parts while balancing the required level of customer service with the allowed inventory investment). SPO is able to provide that level of information by using sophisticated risk-based algorithms specifically designed to handle the uncertainty inherent in knowing when or where a particular piece of equipment may fail, and a spare part will be needed. For more information, see Lucrative but "Risky" Aftermarket Business—Service and Replacement Parts SCM.


SOURCE:-
http://www.technologyevaluation.com/research/articles/software-as-a-service-beyond-customer-relationship-management-and-sales-18458/

Lose the Starry-Eyes, Analyze:An Ideal Customer for Relevant INFIMACS

There is a client for every ERP solution, but how do you identify the vendor that considers your company as its ideal candidate? Different vendors target different industries, markets, and specialize in certain areas more than others. While it is good to identify vendors that work within your industry (Refer to the Industry Focus column of the TechnologyEvaluation.com Vendor Showcase), it is also important to review the products that support a similar set of functionality to your company's requirements. To this end, TEC prepares a page of graphs for each company in the vendor showcase. The graphs specify the ideal candidate for each vendor based on the vendor's strongest areas. By reviewing these graphs and then using TEC's ERP Evaluation Center's WebTESS tool, you can determine how closely the functionality your organization requires, aligns with an ERP vendor's ideal candidate.

Understanding the Ideal Candidate Page

For each high-level criterion in the TEC ERP Evaluation Center's knowledge base, there are four graphs. The first two graphs are baseline graphs. In the baseline graphs TEC normalizes all criteria to an equal relevance, which allows you to see how a vendor's product scores on its own merit, without regard to any one module taking precedence over another. By checking the vendor's results against a normalized baseline, you clearly see the modules and functionality on which the vendor puts the most emphasis.

The second set of graphs is prioritized according to groups of criteria. TEC adjusts the baseline in these graphs so that it corresponds to each vendor's focus. The prioritized graphs make the vendor's strengths stand out against its weaknesses. A group of criteria increases or decreases its contribution to the vendor's scores according to the type of support the vendor provides.

When you go through the graphs for a vendor, notice that in each set of graphs (the baseline pair and the prioritized pair) there is a global priority bar graph and a contribution analysis spider graph. You can look at the global priority graph and by glancing at the height of its bars, see the criteria that are the vendor's greatest strengths. By comparing the baseline graphs to the contribution analyses you will see what the vendor supports in relation to a benchmark of the criterion's optimal contribution.

Examining Relevant

You may look at the ideal candidate pages for several different vendors, see one that seems to match very closely with your requirements and suppose this vendor's solution is aimed at your type of company. Be aware of the perspective from which you consider the criteria; let's consider Relevant Business Systems.


Vendor Comparisons

If you were comparing Relevant against another vendor whose ideal candidate profile also excelled in the Payroll area you would want to see to what degree each supported the Payroll Management criteria. Researching the specific criteria the vendor supports based on its ideal candidate profile should illuminate why a vendor would or would not consider your company's requirements ideal for what its product supports. For example, we see from the overview of the high-level criteria (Figures 1 and 2) in the Ideal Candidate Profile that Human Resources was not the best area to consider for supported features from Relevant, rather we should analyze the product from the perspective of its Manufacturing Management functionality.

In fact, when all criteria are given an equal priority (the normalized benchmark in Figure 2). Relevant's Inventory Management and Purchasing Management scores are not far behind its Manufacturing Management score. These groups of criteria do not have any higher level groups that could influence their contribution to the graph, so we should look at these as the real strengths of Relevant's system.

Focus on Manufacturing Management

Relevant has a number of strengths such as Inventory Management, but its strongest point is clearly its Manufacturing Management module; let's examine the module. Figure 8 shows that Manufacturing Management extends the furthest from the center of the Contribution Analysis baseline graph. Figures 7 and 8, show the areas of Manufacturing Management that contribute most to the overall score.

SOURCE:-
http://www.technologyevaluation.com/research/articles/lose-the-starry-eyes-analyze-an-ideal-customer-for-relevant-infimacs-16747/