Cincom Systems Background
Cincom Systems, Inc. (www.cincom.com), a privately held, Cincinnati, OH based provider of software solutions and services primarily to complex manufacturers has possibly been a schoolbook case of longevity in the software business. Since 1968, the company has developed tools for manufacturing, financial, and sales automation applications. Its software manages application development, customer support, database, call center, and manufacturing functions. Recently, in addition to core ERP software, Cincom developed, marketed, and supports software for customer relationship management (CRM), document management, and knowledge systems for sales.
Cincom Manufacturing Business Solution's latest product release covers many new bases, is architecturally adequate, and remains a well-attuned offering for ETO and MRO enterprises. While it is a competitive product that will create buzz in its markets, the road to success is by no means guaranteed.
This, Part 2 of a 3-part note examining Cincom, discusses the Market Impact of the announcements detailed in Part 1.
Part 3 will discuss the Challenges faced by Cincom and makes User Recommendations.
Response to Competition
To at least keep abreast of the competition, Cincom embarked a few years ago on technologically rejuvenating its product, while maintaining its customer base. More recently, the focus has also evolved to target collaborative e-Business and enhancements to the product centered around embedding workflow and messaging alerts (event management) to notify personnel based on defined business process parameters. To that end, the introduction of CONTROLTM, a Web-based ERP system provided a foundation for complex manufacturers to use the Internet as to embrace e-Business and collaboration. Also the system, which now runs under Windows NT and UNIX operating systems, is slated to run on the Windows 2000/XP platform some time in 2003. The database options remain Oracle and Cincom's own proprietary SUPRA.
With CONTROL, Cincom has also built-in support for BizTalk, Microsoft's eXtensible Markup Language (XML) based integration software product, rendering the system from being a transaction-based environment to an event-enabled environment. These are necessary features, as complex manufacturers are conducting a great deal of collaboration during the phases of design, configuration management, program management, and engineering change management (ECM). Therefore, they are in need of a system, which allows them to publish events internally and externally to other systems and other users, to support this broader, workgroup-based range of collaborative commerce functions.
Today, Cincom addresses the needs of highly engineered, complex and project-based manufacturing and distribution enterprises with two ERP systems - Cincom's PriorityTM (formerly MANAGE:EnterpriseTM) for the small-to-medium (SME) sector, and CONTROL for the larger mid-market enterprises, with more than $50 million in revenues. The company has extended both flagship ERP systems considerably over the last couple of years, with significant R&D investment, to feature much more than conventional ERP functionality, such as CRM, advanced planning and scheduling (APS), and collaborative commerce tools, although some of these are being delivered through partnerships. Both products have the deep costing and procurement functionality that is a necessity for companies that sell complex, highly engineered sub-assemblies and/or products by major projects, or through government contracts.
CONTROL covers all the deep nitty-gritties of manufacturing and engineering (e.g., bills of material (BOM), engineering change control (ECC), revision control, document management, planning (MPS/MRP), shop floor control, project manufacturing control, business intelligence (BI), etc.). The system supports the needs of multi-national companies too through distributed multi-site implementation options, multiple currencies, and multiple languages.
Sales Cycle Support
Outside of the conventional realm of an ERP system, Cincom rounds out the solid CRM/SFA capability throughout the entire sales cycle including prospecting, estimating, product configuration, and proposals creation. The product configurator and interactive selling tool support customer acquisition, quotation, and ordering. Unlike most product configurators, Cincom's graphical knowledge modeling environment makes it easy for non-technical users to quickly develop solutions that assist in the analysis of customer needs, product selection, product configuration, pricing, quotations, and customer support.
This suite is either offered as part of the CONTROL system or as a stand-alone, third-party application, is an interactive selling system that enables complex manufacturers to capture and deliver critical knowledge for customer interaction wherever that may take place - on the road, via the Web, or the phone.
In addition to the core functions of CONTROL:2002 that support ETO processes, the Enterprise Management suite offers six optional modules: Demand Management, Program Management, Quality Management, Financial Management, Aftermarket Management, and Collaboration Management. Financial Management functionality is delivered through a reseller agreement with CODA software, Quality Management comes from the reseller alliance with Pilgrim Software, whereas web-based Collaboration Management is developed in-house, leveraging Microsoft BizTalk. The CONTROL Quality Management module is available now, as well as the Collaboration Management (including e-business document exchange, advanced electronic data interchange (EDI), Internet EDI, and a full e-collaboration infrastructure), and in-depth CRM modules, all based on Microsoft BizTalk and Cincom's Event Enabled Environment (E3) software.
An APS, constraint-based system that is well attuned to the needs of complex manufacturers has also been delivered via an alliance with Ortems S.A. The Ortems functionality is used both for planning and for real-time execution to balance the ever-changing availability status of equipment, personnel, and materials.
Overall, CONTROL:2002 handles many needed ETO processes from dynamic PLM-product lifecycle management (with strong information exchange and efficiently allocated resources) to configuration management (in which changes are immediately reflected throughout the enterprise and product lifecycle), and demand management for demand-driven manufacturing.
Demand Management Enhancements
A couple years ago, Cincom also introduced a demand management suite that supports flow manufacturing practices for complex product manufacturers. The suite's applications include demand scheduler, Kanban sizing and replenishment, flexible fence planning, and SOP. A key part of adapting the flow techniques to complex product manufacturing, often considered as opposing and conflicting practices, is to be able to gauge the effects of custom product configurations on flow lines. To that end, Cincom's Demand ManagerTM translates feature and option sets to equivalent units of the end item, which is then used in determining the time slot the order can be scheduled in the manufacturing flow line. Additional enhancements are slated for the second half of 2002 to Demand Management (flexible planning, Kanban management, supplier visibility, and sales and operations planning (SOP)).
Cincom's Aftermarket Management, application suite manages aftermarket services, including the management of repair part depots and field service. In 1999, the company introduced the solution to help manage aftermarket operations for original equipment manufacturers (OEMs) on top of their existing UNIX-based ERP systems. Shrinking margins owing to increased competition and rising labor costs, have forced many companies to turn to the aftermarket service to bolster their profits. Consequently, they needed software specifically designed to manage this type of business effectively, by controlling concurrently both labor and material costs.
Aftermarket Management was built with strong tracking and accounting functionality, along with greatly enhanced flexibility in mind. For example, in telecommunications switching equipment, in almost every installation as a rule, there often is a mix of new parts, remanufactured parts, and existing parts, and the system must track all these. Since management accounting functionality should also make aftermarket services visible at the bottom line, Aftermarket Management provides detailed reporting to help managers understand the financial impact of aftermarket services, including field service maintenance; remanufacturing, repair and overhaul; depot maintenance, and service parts distribution.
Nevertheless, Cincom will have to address inevitable challenges in order to continue to thrive in this ruthless competitive environment with a limited opportunity and functionality that is not easily leverageable in many other diverse sectors.
Addressing Smaller Enterprises
On the other hand, Cincom's Priority covers many smaller enterprises' needs such as sales, engineering, MRP, inventory control, purchasing, production, project management, human resources (HR), costing and financial accounting, as well as CRM, factory modeling/routing, supply chain control, business intelligence (delivered via an alliance with Cognos) and integrated e-commerce. It also features built-in modification flexibility so that users are able to manage system changes and future upgrades (via a regression control).
A native APS component allows assemble-to-order (ATO) and MTO planning to be priority driven, as to enable users to change order priorities without having an impact on due dates, and to also enable them to examine the results before selecting the optimum workflow, all with a view to maintain low inventory costs, use machinery efficiently, and satisfy fluctuating customer demands.
ETO sector-specific additional functionality includes subcontract control, project management, supply chain control, vendor management, quotation management, cost management and analysis, and integrated e-commerce, with web storefront, customer service, e-procurement and remote field service management. Cincom's Priority is available either as client-server or web-based system on Windows 98, NT, 2000 clients, with an NT Server, while database is Oracle or MS SQL Server.
This concludes Part 2 of a 3-part note on Cincom Systems.
Part 1 detailed the recent announcements.
Part 3 will discuss the challenges faced by Cincom and make User Recommendations.