Can Java Perk Legacy Enterprise Resource Planning Systems?
Before their merger, Lawson (NASDAQ: LWSN) and Intentia (XSSE:INT B) were actively trying to cater to both existing and prospective customers. Sweden-based Intentia redesigned and rewrote Movex in Java, its extended enterprise resource planning (ERP) system, and US-based Lawson announced its Landmark technology development system. (For more information, see Intentia: Java Evolution From AS/400).
Both are examples of how independent software vendors (ISV) have been trying to win customers. They feature the latest and most modern technologies, where rich functionality and rapid implementation go without saying. Many leading vendors are now focusing on evolutionary product and service strategies as opposed to revolutionary strategies and are providing next-generation development and comprehensive infrastructure platforms. They offer continual product functionality enhancements, along with custom extensions; as a result, clients can forgo "ripping and replacing" current systems with new ones, yet still benefit from technological developments. See SOA-based Applications and Infrastructure—The Next Frontier?
By switching Movex to Java, the software has became Web enabled, allowing users to connect remotely. Before, the only other realistic solution to remote computing was through Citrix or Microsoft's Terminal Services (MTS). Further, in 2003, a portal platform called Movex Workplace was made generally available to the Movex suite. In addition to serving as a browser-based user interface and portal, Workplace offers about 4,000 preconfigured work roles and information flows, plus, it represents a nucleus to create other workflows. Through these developments, Movex can offer hardware independence by running hardware, operating systems (OS), and database combinations as IBM iSeries with DB2 database; Sun's Fire Server, with Sun Solaris and Oracle, and IBM eServer xSeries, with Microsoft Windows and SQL Server.
Java-based since 1999, Movex, has been broken into components over the last few years, which may very well give Intentia a stronger technology advantage over other ERP vendors targeting medium enterprises. Today, many mid-market companies are still running on enterprise systems that are ten or fifteen years old, therefore, by using an evolutionary approach, Intentia plans to add value with new functionality to elevate these prospects onto a higher technological plane to take them into the future. Yet, while Intentia has gone a long way to release its second-generation 2002 Java suite, maintaining the Java momentum has come at a heavy price. To our knowledge, constructing an architecture to be the only extended-ERP offering that is fully Java-based, has come at a heavy price and eroded the company's financial position. This has prompted the need to merge with Lawson Software which is also suffering from similar ailments. (see Intentia Has Been Bleeding for Its Platform Independence).
This is Part One of a multipart note.
Intentia's Key Challenge
Intentia's key challenge remains leveraging the Java upgrade to claim the "lion's share" of existing customers who currently use Report Program Generator (RPG). RPG is a programming language used for developing business applications and to generate reports. It was developed by IBM in the mid 1960s and its newest version, RPG IV, is still widely used on iSeries systems. Catering to this market might make or break the company even post-merger. Most traditional AS/400-based ERP suppliers, ultimately lost the battle to migrate from RPG to a new environment, and were eventually acquired. To ease the market's transition from RPB to Java, Intentia's current Movex Version 12 is available in both flavors; however, RPG is only offered in so-called "maintenance mode" and for new sales. Intentia will be taking the bold next step of making Movex solely Java-based—at least this is where the company stood prior to its announcement of the Lawson merger. To date nearly 300 customers (about 10 percent of total customers) with nearly 50,000 users run on Java, and there are 100 or so ongoing new systems and migration implementations.
Still, of over 3,000 customers in 40 countries (73 percent) run on iSeries, 14 percent on Solaris, and the rest on Windows. Therefore, Intentia has geared up for a mass migration to Java, and to that end, it has trained nearly 1,000 business consultants, 300 application engineers, and has generated 350 technical support documents. The pure Java version offers multiple benefits. It can obviate most of the customizations done on the UI in the RPG version by offering a role-based GUI. It also offers transparency to future platforms (e.g., there is one Linux system reference too); enables the creation of composite applications; and allows easier customizations. Overall, it might lower total cost of ownership (TCO), while allowing better systems management, application centralization and consolidation, and create more efficient users with a more intuitive UI.
However, while the adoption of Movex has not been great so far, the perception of the Java version within the Movex install base itself has also been wanting. After all, the Java version was launched in 1999, and there have been reports of slow system performance, and Intentia admits to some implementation glitches resulting from not assigning the best project management team on the crucial pilot, and for proof-of-concept implementation projects. Recently, Intentia's Opportunity Analyzer was developed and delivered to help customers justify the Java upgrade. The product enables project managers to precisely quantify the project's objectives and scope, which are two "proverbial" critical success factors (CSF). Additionally, if there are other areas which could be improved, then the product should identify the best ones to tackle. Management will also get a clearer picture of what processes should have to change, well before the project starts. For more information on similar products that aim at increasing the chances of business success in any upgrade or new implementation, see Enterprise Process Improvement (EPI) Software: Customer and Software Vendor Collaboration.
This concludes Part One of a multipart note.