Geac Trying Its Luck in Partnering

Geac Trying Its Luck in Partnering
P.J. Jakovljevic - September 21, 2000

Event Summary

According to a press release from August 21, Applix, Inc., a global e-business solutions company, and Geac Enterprise Solutions, a division of Geac Computer Corporation Limited, a Canadian supplier of enterprise management software, have partnered to deliver a global, Web-based iCRM solution to customers. Geac will distribute Applix's iCRM solution on a worldwide basis as both a component of its own solution offering and as a standalone application in select markets. As proof of its commitment, Geac will implement Applix's iEnterprise iCRM solution for its own internal use.

Geac will use Applix iEnterprise software to interface the customer-facing front office business processes to its back office applications. Subsequently, it will use Applix's iTM1 business intelligence solution to analyze customer data to help users improve business efficiency and provide customers with the information and services they need. By accessing enterprise-wide data, businesses will be able to accurately measure levels and patterns of customer demand in real time. Also, when the highly flexible iEnterprise is configured to Geac's solutions (SmartStream, System21, E Series, M Series, SQL Financials, TotalHR), the browser access will enable customer data to be viewed and analyzed remotely, regardless of where the transactions are made. The extensive information available relating to customer sales, previous orders, service levels and prior performance will give organizations the necessary data to fully understand the cost of transactions and streamline the entire process of customer interaction, such as matching the most suitable process with the right customer.

"In the New Economy, maintaining both new and established customer relationships is not an option - it is a necessity," explains Harry Debes, President, Geac Enterprise Solutions. "By partnering with Applix, Geac Enterprise Solutions can now show businesses how to use the data that our applications maintain to improve and streamline the way their e-business interacts with the customer. It is yet another example of Geac Enterprise Solutions' commitment to supply mid-market companies with unrivalled and specialized end-to-end solutions to help them prosper in the new digital age. This represents a significant step in Geac's strategy of enhancing its customers' existing investments to participate wholeheartedly in the New Economy."

Earlier, on August 7, FRx Software Corporation, a Denver-based company specializing in the development of advanced financial reporting and analytical application software, announced a strategic partnership with Geac Enterprise Solutions. As part of the agreement, Geac will make FRx available to its SmartStream customer base and will extend its pre-existing interface with FRx for SQL Financials customers. Geac will also include FRx with all new license agreements into its SmartStream, SQL Financials and E Series and M Series product suites. In addition to bundling FRx into future solution packages, Geac will market and sell the product to its existing customer base, which includes businesses in the hospitality, property, banking and publishing industries. This combination will allow Geac customers rapid access to critical financial information and reports needed to make more informed business decisions.

"We chose to partner with FRx Software based on its reputation, quality of product and commitment to its customers," said Peter Quinn, vice president of Product Marketing, Geac Enterprise Solutions. "Through this partnership we can offer our clients the ability to provide their customers with industry-leading financial reporting capabilities that maximize Geac's ERP solutions."

Market Impact

After a slew of acquisitions in the past, which have resulted in varied outcomes, Geac seems to be trying another tack to expand its product offering and to convince the market about its commitment to further develop certain attractive product lines.

We maintain our position that Geac will not establish itself as an enterprise applications leader as long as it remains perceived as a company that acquires, botches up, and possibly divests other under performing software vendors and/or products. The company will have to become a true software-developing vendor, not simply a software collector and/or dealer within some esoteric market segments. It will need to add much more value to its products and services to attract and retain customers instead of simply increasing the investment in the existing, possibly outdated, core products and support services. For these reasons, we endorse Geac's recent partnering initiatives in case as well as its alliance with IBM from the beginning of this year, which features Geac's System 21 on IBM hardware, with IBM consulting services and e-Business solutions.

Its applications must be able to support future business requirements, which are nowadays directly related to customers' e-business strategies. While the company is currently not in a position to offer a comprehensive e-business and CRM solution on its own, it should, nevertheless, be able to at least provide a back-office hub and bridges to e-business components in the fashion similar to J.D. Edwards' EAI strategy. To that end, Geac must develop standard, common components that will be readily available within its product portfolio.

Geac acquired System 21 through its acquisition of JBA International. In spite of the fact that Geac, which is a large software company with a track record for profitability and growth, has significantly enhanced System 21 by embedding acquired CRM and SCE products for the apparel industry, Geac has been unable to be successful in marketing its System 21 business. The revenue from the product in the last year was embarrassingly low ($67 million) compared to the level attained in 1998, when JBA reported $487 million in sales. Therefore, its recent partnering initiatives are only an initial necessary step in creating its market recognition as a strong global business applications vendor to be reckoned with.

User Recommendations

Geac customers should certainly consider the company's latest value proposition, but avoid selecting it without looking at what the other vendors have to offer. As for potential customers, we generally recommend including Geac in a long list of an enterprise application selection to mid-market and low end tier 1 companies (with $100M-$1B in revenue), based on a very deep understanding of customers' needs within the following industries: Library Systems; Construction Systems; Property Management Systems; Hospitality Systems; Public Safety Systems; Publishing Systems; Manufacturing & Distribution Systems; Real Estate Systems; Cash & Securities Reconciliation Solutions. We also generally recommend including JBA System 21 in a long list of an enterprise application selection to mid-market and low-end Tier 1 companies (with $50M-$1B in revenue), within the following industries: Automotive Components, Apparel & Footwear, Beverage, Food, and Electronics.

Other industries might also benefit from evaluating the respective Geac point solution, bearing in mind inevitable integration issues with other systems in place. Future clients are also advised to request the Company's written commitment to promised functionality, general availability date, price, length of implementation, and seamless future upgrades. Each component should be put through its paces using a well-documented set of requirements, scripted scenarios demonstrations and rigorous reference checking. If a complementary product beyond core ERP (e.g., CRM, e-commerce, SCM, etc.) is of a critical importance, users should think carefully about the possible integration implications and may benefit from considering competitors' value propositions too. Furthermore, users will benefit from informing themselves about what the company plans for future service & support (or divestiture and/or product stabilization?) of its individual products are and what would the ramifications of migrating (or not) to its new product offering be.

In the short term, users should expect a bumpy road since Geac and Applix or FRx still need time in which to smooth their collaboration on delivering technical support for the products. Should all the parties show the true commitment to the partnership, these problems are likely to diminish. Prospective buyers of enterprise software should then look favorably on the deal and increase their rating of Geac in any ongoing or future evaluations.

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