Lilly Lilly Software Visualizes Its eBusiness Offering, NOW
2: Market Impact
On October 16, Lilly Software Associates (LSA) (www.lillysoftware.com),
a privately held enterprise applications provider for small and medium
sized manufacturing and distribution enterprises, announced VISUAL
eBusiness version 3.0, the latest release of its online solution
designed to help businesses streamline processes, improve productivity
and increase efficiencies through the use of Internet technologies.
Lilly also released VISUAL eBusiness NOW, a new application service
provider (ASP) option that should deliver speed, flexibility, and affordability
through Web hosting. Version 3.0 supports business-to-business (B2B) and
business-to-consumer (B2C) transactions for both make-to-stock (MTS) and
make-to-order (MTO) environments. It is an extension of Lilly's ERP and
warehouse management system (WMS) products, allowing manufacturers and
distributors to post catalogs and pricing information on the Web. The
self-service features of the application allow customers and distribution
partners to view pricing, order status, product features, and product
believes that, with the opportunity to implement the application either
through an integrated module within the VISUAL product suite or via Lilly's
new ASP option, manufacturers and distributors can easily get started
with their e-business initiatives.
is Part Two of a two-part note discussing Lilly Software's recent
announcements. Part One covered
the announcements, this part discusses the Market Impact and makes User
For the near future Lilly Software (LSA) will leverage its job
shop manufacturing domain expertise, the latest technology and object-oriented
architecture, and an established distribution channel to pursue mid-sized
manufacturers, distributors and distribution-oriented manufacturers.
the medium-to-long run, LSA will be broadening its offering out to manufacturers
and distributors with mixed mode and make-to-stock (MTS) strategies, and
mid market enterprises looking for interoperability with other enterprise
applications. To that end, the Lilly has struck an alliance with Viewlocity
to facilitate interoperability with other ERP systems.
the technology standpoint, the company has long supported Microsoft's
technologies (COM/DNA, ODBC and Office 2000), with a recent embracing
and move to Microsoft .NET architecture framework. Its products support
almost all relevant databases (SQL Server, Oracle, and IBM DB2/400) and
operational systems (NT, Unix and OS/400) platforms.
this year, the company launched its portal product, called LSAGateway.com.
The offering provides access to the Knowledge Center, a customer-support
portal; Education Center, for information on education and training opportunities;
Market Place, a place to identify other Lilly users as potential customers,
vendors, and business partners; and Collaboration Center, for on-line
design collaboration. Therefore, with VISUAL eBusiness as part
of its solution, and with ASP/ hosting and integration services, Lilly
rounds up an impressive arsenal for small and medium-sized enterprises
real strength of VISUAL is its integration across all the functions of
a manufacturing enterprise from design, via sell, make, distribute, to
after-sales service. The fact that virtually all of LSA's applications
have been developed in-house, instead of through multiple acquisitions,
might be a significant differentiator in the areas of product consistency
and integration. Another reason of Lilly's success is its distribution
model, which is based solely on an indirect channel. The channel is comprised
of over 500 companies and individuals that sell only Lilly's VISUAL product
Nevertheless, Lilly Software will have to address certain challenges in
order to continue to thrive in this cutthroat competitive environment
and to move up-market. Its market awareness and global presence are still
insignificant in spite of the recent international expansion like, e.g.,
in the UK and the Latin America.
Furthermore, the product shows inferior functionality in realms outside
of job-shop manufacturing functionality on the plant level and of distribution,
like the 'ivory tower' corporate level financial and human resources capability.
Moreover, the product does not currently offer the ability to control
repetitive production with rate-based scheduling techniques.
and managing individual work orders is still a requirement; hence, it
is not well suited for lean manufacturing/pure repetitive environments.
Further, it offers only a limited standard costing method, cost simulation
and planning tools compared to what most cost accountants are expecting
in a "standard cost" system.
VISUAL's multi-site and multi-national capabilities have been improving
(the product currently supports 8 languages), it still has some limitations
in handling distributed manufacturing entities - it requires either a
completely centralized set of activities for manufacturing and accounting
or a completely decentralized one. As an example, there is no ability
to perform some functions like production control on a decentralized basis
and then to have centralized order entry and accounts receivable. The
product also still requires a single database per one manufacturing entity,
and it has not been designed for high transaction volume environments.
the technology front, while Lilly has embraced the above-mentioned trendy
Microsoft technology that promises a building-block approach to application
development, and XML-based interconnectivity, its vast majority of customers
still run on a fat client two-tier client/server architecture. Migrating
these onto new, more advanced product releases and/or continued concurrent
support of diverse product architectures will demand duplicated R&D resources.
is also somewhat intriguing that the company neither has multiple prominent
functional and technology partners nor ready-made applications programming
interfaces (APIs) to other prominent products, which may indicate insufficient
product interconnectivity. The mitigating factor though is the company's
decent approach towards not overselling its offering and declining to
compete in instances where it does not seem its products fit. However,
the company's need to re-deploy the product on a new technology and to
deliver the needed functionality for its new desired markets, will demand
the continued hefty R&D investment, which may put a significant strain
on the company's resources in the long run, particularly if the top line
remains flat or possibly even declines.
Lilly Software's target market, single-site job shop discrete manufacturing
and distribution companies and/or divisions of global corporations with
up to $200 million-a-year revenue range, should consider VISUAL Manufacturing
and VISUAL APS products, but avoid selecting it without looking at what
the other vendors have to offer. These companies generally have a limited
IT budget, a conservative IT strategy, complex discrete job shop manufacturing
and supply chain demands (strong capable-to-promise (CTP) requirements),
and basic CRM and B2B e-commerce requirements.
industries that would most likely benefit from Lilly's products are aerospace
& defense (A&D), electronics, instrumentation, industrial machinery, fabricated
metals, consumer packaged goods (CPG), wholesale distribution, automotive
and transportation equipment.
that require strong multi-site and multi-national capability, high-volume
transaction processing, and 'white collar' functional depth at the corporate
level may benefit from evaluating other offerings.
contract manufacturers with strong distribution requirements, distributing
companies with value-added services, and third-party logistics (3PL) companies
with up to $500 million in annual revenues may want to evaluate Lilly's
VISUAL Distribution product.
and fledgling job-shop manufacturing outlets (e.g., tool and machine shops)
with less than $10 million in annual revenues that already have small
business accounting package (e.g., QuickBooks Pro) but are in need of
manufacturing oriented software functionality, should evaluate VISUAL
Jobshop product. Potential customers evaluating Lilly should consider
the latest enhancement modules an essential part of Lilly's product offering
and insist on reviewing them as part of their evaluation.
Lilly customers should review the above-mentioned enhancements with their
local LSA affiliate with an eye towards extending the value of existing
applications. Lilly customers with custom systems or products from other
vendors should review the LSA's development capabilities in order to gain
data integration between their various systems. Current users should also
inquire about any possible impact (or benefits) that Lilly's new product
technology strategy might have on their current investments (e.g., the
product migration strategy).