The vendor that many have long considered 'gone south' seems to be showing
signs of resilience. SSA Global Technologies (SSA
GT) is the result of the acquisition of former System Software
Associates (SSA) and its BPCS product by Gore
Technologies. SSA GT has long developed an extensive, worldwide
sales channel of affiliates. This channel has been selling the BPCS product
to the medium to large segments of selected enterprise applications markets.
In a strategy designed to address a market not covered by its BPCS product,
on April 2, SSA GT acquired ICL MAX International
Limited (MAX International) and its product, MAX.
This strategy attempts to leverage its existing channel to reach the small
to medium enterprises (SMEs).
MAX product has established itself in selected, mostly European markets,
as a small to medium enterprise offering. MAX is currently installed in
450 small to medium manufacturing enterprises in the $10 million to $100
million revenue range across the UK, western and central Europe.
will reportedly continue to exist as a stand-alone business operation
within SSA GT with its headquarters in Bristol UK. It will attempt to
leverage the existing SSA GT distribution channels, while its development
will continue in Bristol. MAX and BPCS are positioned at different segments
of the manufacturing marketplace with no overlap seen by SSA GT. Hence,
no plans exist to merge the BPCS and MAX products or operations apart
from products' distribution operations. Initial marketing plans call for
expansion of the MAX effort within Europe with later expansion into South
Asia and Latin America.
is an integrated package of business systems, designed for companies in
the manufacturing, contracting, service and distribution sectors. MAX
includes e-Commerce with e.MAX linking e-Commerce with ERP and
CRM. MAX is multi-company, multi-lingual, multi-currency, multi-warehouse,
multi-location and has been installed in most types of manufacturing environments
including mixed mode. MAX operates under Windows NT or UNIX and is continually
developed to give industry leading RDBMS options, currently SQL
Server, Informix and Oracle.
mergers and/or acquisitions in the mid-market in the recent times are
no surprise per se, SSA GT's action has an additional meaning. Although
the acquisition of MAX by SSA GT should have minimal impact on the global
market in the short run, it might have an important psychological effect
on existing SSA GT's customer base. Former SSA has suffered, over the
past few years, a tremendous loss of market share and customer confidence,
while its channel also dwindled during the same period of time. As a result,
the market has witnessed an array of competitors preying on its large,
perturbed customer base. There have been ominous indications that many
of BPCS users were at least considering migration to another provider,
while many have already opted for it. To that end, the acquisition may
be a sign of SSA GT's continued commitment to the manufacturing sector.
there are indications of SSA GT's success in shoring up its customer base,
particularly in markets outside of North America. SSA GT has been focusing
on keeping its large install base (more than 6500 implementations at over
18,000 sites in more than 90 countries) content and fine tuning its Portfolio
marketing strategy - the integration of specialized 3rd-party applications
into BPCS. Dealing with a single point of contact for most IT needs can
be attractive to some manufacturers at the higher end of the mid-market
and SSA GT's Portfolio strategy allows for this, with reseller agreements
on a number of best-of-breed products (e.g., i2, Cognos,
Business Objects, etc.) and an open architecture to make
it feasible to interface and integrate. However, this strategy would not
likely be attractive to smaller enterprises where MAX, with a broader
native functionality footprint, may seem as much better fit. Therefore,
we believe that in the intermediate term, MAX will begin to seek a position
in the global market for small to medium sized manufacturing companies.
SSA GT's success in this effort will be determined by its ability to leverage
its existing channels.
positive developments should be backed up with the continued commitment
to development of the eBPCS product notwithstanding. The fact remains
that SSA does not yet offer much more than its core, possibly outmoded
ERP product in conjunction with assistance integrating extended-ERP software
components from alliances. To that end, in addition to the value added
by software partners, recently instituted R&D initiatives stemming from
Customer Steering Groups' inputs rather than an 'ivory tower' development
approach are commendable. The more aggressive interaction with the analyst
community and more perspicacious explanation of its Semantic Message
Gateway (SMG) technology would also be desirable.
favorably regard the release of version 6.1 of eBPCS, which features long-awaited
stability and better performance of eBPCS 6 as well as the support for
Windows NT and Windows 2000. Also, SSA GT's established global infrastructure
and customer base, strong core-ERP functionality with a sharp industry
focus, strong multinational product functionality, and a relative ease
of implementing eBPCS are some of the company's bargaining chips in the
game of averting its customers from jumping the ship.
SSA GT may have difficulties leveraging its existing client base and channel.
SSA GT has yet to deliver Web-based, portal-style access to eBPCS, which
makes it at least a year behind its competition regarding e-business capabilities,
and consequently vulnerable to their attacks. Therefore, vendors who sell
replacement solutions for the BPCS ERP system will see minimal impact
from the above announcement in the short term. However, vendors who offer
add-on products that satisfy the needs addressed by the plans involving
the SSA GT Portfolio and who are pre-integrated will face a fiercer competition
from SSA GT over time. These vendors must evaluate their relative position
and rededicate themselves to the BPCS and MAX communities to be successful
in this market.
The SSA GT's moves should cause a sigh of relief from its existing BPCS
customers. Less technologically aggressive companies may be better off
by staying with BPCS for the time being. Nevertheless, be on high alert
and develop medium- to long-term alternative plans for moving to a new
technology. Identifying and approaching your local SSA GT sales representative
and asking for assurances and firm commitment to future service and support
would be the best course of action at this stage.
the new product strategy, particularly within CRM, e-business and Internet
trade exchanges, is crystal clear and has been publicly committed to,
we advise potential users to evaluate the product warily even within its
automotive, consumer packaged goods, electronics, pharmaceutical and chemical
industries sweet spots. Learning about new eBPCS features would be beneficial,
at least for information and leverage against other vendors. We also suggest
evaluating the bells-and-whistles, price, reference sites within your
industry, and corporate viability of other vendors before making a selection.
companies in the small to medium size range (under $100 million in revenues)
European companies should place MAX on their long list. Companies not
included in this group (larger or non-European) should not consider MAX
at this time.