Every meeting with SYSPRO USA brings about some more affirmation that sticking to its core values and principles should bring good results for any company. As a privately held company since its inception in 1978, SYSPRO has always been in control of its destiny and not distracted by the quirks of stock markets and investors’ impatience. The vendor has been agile, innovative, reliable, and with focus on ensuring product value and long-term customer relationships.
The company’s adherence to developing technology based on the needs of customers is among the reasons why it enjoys one of the highest customer retention rates in the industry. Indeed more than 14,500 licensed companies in 60 countries and across 6 continents have repeatedly shown their satisfaction in terms of SYSPRO’s price-to-performance ratio. SYSPRO 6.1 is the current release of the vendor’s suite of future-proof software that enhances the competitive forays of small to midsized manufacturers and distributors.
As SYSPRO has no major acquisitions in its long history, its products are transcribed and translated from a “single DNA,” resulting in consistent look-and-feel and structure. The products’ underlying .NET architecture enables simplified third-party product integration and customization. SYSPRO’s solutions can be tailored to customers’ specific needs and are sold primarily via the channel and a direct SYSPRO sales team. The offerings are quite comprehensive, but for some special requirements or in some industry and/or region, SYSPRO might partner with other vendors such as MSC for warehousing and data collection, Preactor for advanced planning and scheduling (APS), and uniPoint for quality management.
Getting Even Smarter of Late
What has somewhat changed during the last 12 months or so has been the company’s marketing message. In December 2010, SYSPRO USA introduced its “Einstein” strategy, a witty association with the genius of the world’s most renowned theoretical physicist. The goal of this strategy was simply to make enterprise resource planning (ERP) for the small to midsized manufacturer smarter. As a corollary, a SYSPRO user does not necessarily have to be an Einstein or rocket scientist to be able to use the product.
SYSPRO’s global ‘Simply Smarter ERP’ mantra is about the vendor listening carefully to its customers, perfecting its implementation methodology, and focusing its resources on educanality in order to enable SYSPRO ERP users to maximize business benefits. The word “SMARTER” in ‘Simply Smarter’ is actually an acronym that stands for Strategy, Methodology, Accountability, Resources, Technology, Education, and (Customer) Rewards.
Albert Einstein is best known for developing his theory of relativity with the formula E=MC2. SYSPRO has delivered on its “Einstein” strategy by introducing its own theory of ERP relativity with the following similar formula: S=MC2. In this equivalent equation for the theory of ERP relativity, “M” stands for material, while “C2” is for cost management and cash management, respectively. “S,” of course, stands for SYSPRO. In other words, the value of SYSPRO’s ‘Simply Smarter’ ERP is derived largely from better material management, cost control, and cash management. For more details, see related blog posts by Cindy Jutras of Mint Jutras and by our colleague Aleksey Osintsev.
Enter the Quantum Theory for ERP
Going further along the “Einstein” theme and SYSPRO’s traditional approach to helping customers align strategy to operational processes via rapidly modeled and implemented products, the vendor announced its new multi-faceted framework (see the official press release). Called Quantum Architecture™, the framework extends the SYSPRO USA “Einstein” strategy, which was designed to solve problems that have plagued ERP solutions for years and that have often crippled the ability of smaller businesses to compete effectively. This is a distinctly comprehensive ERP architectural framework for managing today’s technology and data diversity, and for advancing people collaboration and energy, despite constant changes in the business environment. As a parallel to Einstein’s Quantum theory of matter and energy, SYSPRO says that the Quantum framework is targeting the following six business ‘matters’:
- ERP implementation
- Communications and reporting
- Workflow processes
- Security issues (e.g., role-based authorizations)
- Regulatory and financial changes
- Mobile and cloud requirements
The “energy” part of the theory refers to the organizational energy and the potential from being able to mobilize people and streamline and synchronize their actions via the aforementioned six ‘matters.’ Think of how Quantum works via this metaphoric situation: you have an office full of disparate items or events that absolutely do NOT work together—people (each with their own agendas), fax machines, computers, and tablets (all from different eras), chairs (that don’t fit into tables), different keys to the locks on the doors (each lock on a door is different), everyone’s got a different currency in their pocket (so you can’t figure out what and how much you have), etc. Now, along comes this magic framework that says “I am going to map all of your differences, clearly show you where the connection points and issues are, provide a way for you to collaborate and synthesize the disparate pieces to have a holistic view and/or one working methodology that works for everybody. And, by the way, you can customize the system any way you want due to the six aspects listed above.”
Another metaphor might be building a house—and you have all of the contractors show up with different tools (that don’t always work with the standard nails, screws, and staples), different building materials, building inspectors demanding to see plans that don’t exist, etc. These types of impossible hodgepodge environments have plagued small to medium businesses (SMBs) for years, and painfully so in the manufacturing and distribution spaces where there are so many moving parts and not just people issues.
Addressing Both the Bigger and Smaller Pictures
SYSPRO has long had its stringent STARS (Structured Technique to Achieve a Rapid Solution) implementation methodology. STARS will now use the Quantum blueprint to further effectively implement SYSPRO in a constantly dynamic environment by mapping all of the following four components that Quantum encompasses:
- A multi-source, single repository architectural map—that unifies the following:
- Operational strategy
- Processes
- Data
- Product offering
- Technology
- Organization
- Risk & compliance
- Data collaboration modeling—via the following steps:
- Define processes and business rules; record all major decisions and conversations
- Configure roles; define workflow; create user guides, notes, and decisions; devise all manual and customized processes
- Configure (visualize) the unique business model
- Pre-configured system and process models—with the following results:
- All menus, submenus, screens, and panes show the functions and features of the product
- All of the data structures are modeled
- All setup options are clearly presented
- All business processes follow “best practices”
- Embedded role-based reporting and performance measurement:
- Identify key performance indicators (KPIs) and reports by role
- Define menus, processes, and functions by role
- Define security authorizations and sign-offs by role
The Quantum framework apparently is an extension of STARS in that it provides an even richer implementation experience by streamlining all aspects of a project. Mike Krigsman's ZDNet blog post analyzes Quantum’s rapid deployment capabilities.
Quantum: Enterprise Unifier (not Divider)
While rapid implementation is one of the goals of Quantum, it is not necessarily the differentiating trait, as one can find this approach in every mid-market vendor. In fact, Quantum is much more than fast-track implementations, as it unifies the following factors in an enterprise: people & organization, system & technology, and strategy & business processes. Thus, Quantum is about enterprise architecture (EA) and business process management (BPM)—going from all of the top strategic goals down to the individual tasks. These capabilities are quite uncommon in the ERP space. Perhaps QAD has recently started using Savvion BPM within the Progress OpenEdge platform, while Epicor has been developing its .NET-based BPM engine.
SAP and Oracle occasionally embed IDS Scheer's ARIS process modeling and analysis tools, which entail huge consulting projects on their own (say, to deploy the 6s Lean or American Productivity & Quality Center [APQC] best practices frameworks). One might be mixing apples and oranges when lumping SYSPRO Quantum together with, say, SAP Rapid Deployment Solutions (SAP RDS). The latter offering is a ready-to-use combination of software, predefined services, and preconfigured content at a predefined price.
SAP's template-based solutions fill small functional gaps quickly, say, sales and operations planning (S&OP), strategic sourcing, or marketing campaign analytics capabilities (see the related article for more details). But they are not of much use when one starts a brand new comprehensive ERP implementation, and Quantum can come in handy in both situations. The blog posts by Brian Sommer of ZDNet, Nick Castelinna of Aberdeen, and Cindy Jutras of Mint Jutras shed some more light on SYSPRO Quantum Architecture.
SYSPRO USA Speaks Out (for the First Time)
It is interesting to note that during our near decade-long coverage of SYSPRO, we’ve never had a chance for an interview article. Thus, to rectify the situation, what follows now is our discussion with SYSPRO USA’s top executive team. Our poignant questions and the vendor’s clear-cut answers are as follows:
TEC: Has your market and competitive landscape changed of late and how?
SYSPRO: We have focused at small and mid-market manufacturers and distributors for over 30 years. Over the last couple of years, the market has consolidated with vendors either disappearing or being bought out. Since the mid-2000s, the larger ERP players began to aggressively market or sell to the lower mid-market due to saturation at the Tier 1 buyer level. The reality is that the big players’ results have been dismal in this market space. This space is very tightly knit together (strong peer group connections and associations), and stories about deployment disasters of the big players abound.
The further consolidation of the market is creating confusion for buyers, as vendors have multiple products, and product lines from large vendors are varied and not uniform. Another unfortunate by-product is that pricing competition forced by the big players is too often lading buyers to make decisions based on cost and not fit. SYSPRO replaces many failed deployments of the big players, and we could write a book based simply on these customers repeating horror stories about: ill-fitting solutions, poor deployment methodology, nonresponsive service experiences, etc. In contrast, SYSPRO’s strong reputation for service, relationships, and installation excellence is well known throughout the smaller manufacturing and distribution markets.
TEC: What social and mobile apps are generally available now (under which exact name) and what is coming out soon?
SYSPRO: Both SYSPRO Mobile and SYSPRO Social have been a research and development (R&D) priority for a number of years. SYSPRO has the ability to easily incorporate an organization’s unique or common social priorities, as required within any module. For example, you can easily tailor a screen showing LinkedIn information of a contact within SYSPRO. We are already also looking at the automated pushing of information from the SYSPRO ERP into the SYSPRO Social realm; i.e., the ability to update corporate and personal social sites from information gleaned from SYSPRO ERP. For now, users are able to view information only on their mobile devices, but in the future the authorized user will be able to edit data as well. Our mobile strategy is to easily deploy to any device.
TEC: What makes your channel superior to those of your competitors, if not necessarily the absolute number of value-added resellers (VARs)?
SYSPRO: Our channel differentiation can be attributed to the following factors:
- Relationships/Culture: Our relationship with our channel partners is managed via a continuing set of both formal processes and informal “touches.” Both our SYSPRO USA chief executive officer (CEO) and president have built a hands-on management model: executives are accessible and actively engaged with channel partners.
- Customer Centricity: SYSPRO’s extreme focus on customer satisfaction is extended through channel partners, with ongoing training programs focusing on continuous improvement and growth.
- Great Product/Return on Investment (ROI): SYSPRO’s ongoing aggressive R&D activities result in products (an example being SYSPRO’s imminent release of a robust Retail solution), architectures, and infrastructures that are the best in the industry for the SMB manufacturing and distribution markets. This means that it’s a lot easier to build tight partner relationships when the product excels and produces rapid ROI.
TEC: Which products, regions, and verticals have been most active of late? What do you foresee in next 12 to 18 months—more of the same or not?
SYSPRO: As for the product capabilities, we’ve been seeing growing interest and buyer action in inventory control, optimization, and performance management. Also, functionality focused on material, cost, and cash management (see the aforementioned first Einstein S=MC2 announcement) and the architectural requirements that led to Quantum Architecture.
As for verticals—food, medical devices, electronics, machinery and equipment, and automotive are still experiencing the fastest growth according to our current data. We are in the process of identifying some high growth micro verticals as well as increasing our focus on pharma and retail. The retail focus is in line with the pending release of the Retail/SYSPRO Point of Sale (POS) solution. Going forward, SYSPRO will investigate more of the R&D-intensive industries and changes in global trends, regulations, and compliance. Also, SYSPRO will focus on and expand its mobile and analytics offerings. As we head into 2012, we predict a general upward trend in manufacturing.
TEC: What is your long-term growth strategy, given that acquisitions, initial public offering (IPO), and being acquired are not in your DNA?
SYSPRO: We have a long-term sustainable growth strategy that is extremely attractive to the current private owners as well as our customers. SYSPRO will continue to grow organically, and has plans to accelerate growth in specific geographies such as the United States (USA), Europe, Africa, Asia, and South America. As part of our ongoing strategy, we expect to see continued growth from our stable existing customer base and SMB focus. In addition, we are already seeing success with deals in much larger customers, multisite environments, and global footprints. Many of these customers have turned toward SYSPRO as a cost-effective and suitable replacement to SAP and other Tier 1 and 2 products. Building on our recent successes, and in line with our strategy, we definitely see this trend continuing.
TEC: Where is SYSPRO in the true multitenant software-as-a-service (SaaS) game?
SYSPRO: In mid-2011, we launched SYSPRO Business Live, our Cloud offering. The real demand for multitenancy cloud in the perhaps more conservative manufacturing and distribution ERP sector is extremely low. In line with our Product Roadmap, we do have plans to launch multitenancy Cloud in 2013.
TEC: Is there anything you would like to add and/or clarify?
SYSPRO: As we see products coming together and we see changes in the environment, we feel the real success will be around better implementations and enhanced interactive relationships between the software vendor and customer. ERP providers with patched-together product lines are having a harder time convincing smarter SMB buyers that they can get cost-effective, holistic solutions to their technology needs. Our sales cycles reflect that buyers are finally starting to appreciate the difference between organically-built versus acquisition-patched solutions that are neither effective, nor cost-effective. The key is the SYSPRO relationship and our inherent single-DNA cost-effective functionality.
Further Reading
Mid-market ERP Vendors Leveraging (and Occasionally Outdoing) Microsoft’s “Plumbing” – Part 2. February 23, 2011.
Surviving Amid “ERP Sharks” as a “Visionary Vendor for the Pragmatic User” (Part II). February 28, 2008.
Meet the New (Revolutionized) Progress Software. October 20, 2011.
Analyst Road Show with SYSPRO and UNIT4. January 19, 2012.