VAI Explains Its (Quiet) Success in a Hotly Contested ERP Market -- Part 1

Despite my nearly two decades of covering the enterprise resource planning (ERP) market, every now and then I am still surprised to come across a lesser known and yet well run ERP software player. One such vendor is VAI (Vormittag Associates Inc.)--an award winning software developer and an IBM Premier Business Partner. Founded in 1978, VAI is headquartered on Long Island, New York, with US branch offices in Florida, California, and Illinois.

The vendor designs enterprise management software for IBM Power Systems, a platform that accommodates a number of popular operating systems (OSs). These software solutions allow VAI to offer a cost-effective business system to the midrange market. VAI’s solutions have always run on IBM midrange servers, and these multi-tier solutions run on multiple platforms in a variety of infrastructure configurations.

VAI S2K Suite

VAI's flagship S2K Enterprise Software is used by a wide variety of companies worldwide, with a number of clients in the manufacturing, distribution, retail, food, and service & repair industries. Advanced applications such as Warehouse Management, Electronic Data Interchange (EDI), Customer Relationship Management (CRM)Business Intelligence (BI), and e-business provide companies with the means to leverage their IT investment. VAI’s integrated EDI capabilities within the S2K ERP solution help all its customers (Manufacturers, Distributors, and Retailers) to automate their purchasing, sales, and fulfillment processes, and thus to theoretically better serve their customers.

VAI’s S2K Enterprise family of products covers wholesale distribution, manufacturing, retail, financials, and e-Commerce. The main S2K (which stands for “System 2000”) product lines include the following:

  • S2K Enterprise

  • S2K Enterprise for Food

  • S2K Warehouse

  • S2K Sales Force

  • S2K Analytics

From an ERP perspective, S2K for Food is currently a hot product. The food industry is somewhat recession-proof and the need to increase efficiencies and comply with the US FDA Food Safety Regulations for recall tracking, the so-called Food Safety Modernization Act (FMSA), make the need for technology ever present. For its part, S2K Warehouse has been a good door-opening product. Many businesses with installed ERP solutions are looking solely for Warehouse Management and this standalone product that can interface to their current ERP vendor gets the vendor into many companies that may eventually move to VAI’s full ERP suite.

For VAI’s installed customers, S2K Sales Force and S2K Analytics are also products in high demand. VAI is seeing many of its installed accounts buying S2K Sales Force to automate their remote sales force and S2K Analytics for custom reports and dashboards for better insight. They also round out VAI’s ERP suite for new customers as well.

VAI leverages IBM Websphere Portal middleware to deploy S2K Sales Force and IBM Cognos for the S2K Analytics application. This is important because many of VAI’s customers are data rich but information poor. VAI embraces these technologies so that it can give its customers the necessary tools to obtain the information they need to make better business decisions. It will be interesting to see whether VAI will leverage IBM Connections and IBM Worklight for social business and mobility capabilities respectively.

VAI Users

Approximately 1,500 companies have implemented VAI’s software solutions. Of those accounts, 50 percent are in Wholesale Distribution, 40 percent in Manufacturing, and 10 percent are Specialty Retailers/Distributors. VAI customers are predominately in North America, with a smaller presence in Europe, the Middle East and Africa (EMEA) and Asia-Pacific (AP). VAI customers range in size from 20 million dollars (US) in sales to multi-billions of dollars in sales, with VAI’s sweet spot being customers in the 50 to 500 million dollar range.

VAI has 130 employees, with offices located throughout the US, and approximately 100 resellers. S2K’s default language is English, with Spanish and user-defined language capabilities available in VAI’s S2K Financial Management and Warehouse Management applications.

Most of VAI's approximately 100 reseller partners are small system integrators (SIs). As a business model, VAI allows these SIs to sell hardware to its mutual customers, but the implementation and support of all VAI software solutions are done directly by VAI employees. In addition, VAI has some key partnerships with other ISVs that offer integrated solutions to enhance VAI’s ERP suite.

Part 2 of this series will feature my in-depth discussion with VAI’s top management and their views. Your comments, thoughts, suggestions or individual experiences with VAI’s products are welcome in the meantime. For more information, also see VAI’s profile in TEC’s Directory here.
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