Highly Focused Vendors Team For Their Markets' Good
- August 5, 2002
Systems Inc. (NASDAQ:ROSS , www.rossinc.com) is very focused on the
ERP and e-business needs of the process markets. Privately held Prescient
Systems (www.prescientsystems.com), on the other hand, is very focused
on the supply chain needs of the consumer goods markets. Their recent
announcement teams the two to provide a complete system for the target
the agreement, Ross will embed Prescient's complete XEi supply
chain management (SCM) suite and brand it as iRenaissance SCM.
Ross is responsible for providing a standard integration to the XEi suite.
That investment is underway. In addition, Prescient Systems' SCM specialists
will train the Ross sales force in SCM and work with the SCM prospects.
Prescient and Ross intend to undertake language translations for international
markets. The combined product adds to the demand planning capabilities
already present in iRenaissance, extending into integrated replenishment
planning, order optimization and advanced planning and scheduling (APS)
joint efforts have already shown market progress with the signing of a
new iRenaissance SCM customer, a mid-market food manufacturer. Before
this new partnership, the two vendors had a number of joint customers,
including Vi-Jon, a manufacturer and distributor of health and
beauty products, and Nu-Gro, a leader in the development of high-quality
fertilizers, pest control and horticultural products for commercial and
positive sign is that the CEO's of both companies are focused on the success
of the partnership. Pat Tinley, Chairman and CEO of Ross and Jane Hoffer,
CEO Of Prescient have been personally involved with framing the relationship
and planning for its success. Both have been involved in early customer
apparent winners here are Ross' consumer products customers, as they now
have access to an integrated, industry leading, Supply Chain Planning
(SCP) suite originally designed for their needs. Other process manufacturing
companies looking for a full solution now might have an additional option
too, one that appears worthy of full investigation. The partnership is
a good business move for both companies, since each has been successful
in their respective application area, they have minimal functional overlap,
and both have deep domain knowledge. Each has an historic strength of
focusing on a tightly defined set of customers with a high degree of overlap.
A successful, although somewhat sporadic, cooperation between the vendors
in the past should help as well going forward. A long and deliberate process
of forging a new, now official alliance might indicate the products' true
seamless integration in the future, beyond typical marketecture'-like
momentary nature of software industry alliances.
the partnership, Ross expands its footprint to include Supply Chain Planning,
closing thereby likely the largest gap it has traditionally exhibited
compared to its fierce opponents such as Agilisys (see Announcing
Agilisys (Formerly SCT's Process Manufacturing & Distribution Business)
Finally Fully Focused On Process Manufacturing), SAP, Oracle,
J.D. Edwards, Baan/Invensys, Intentia, and SSI.
The Prescient XEi SCP applications within the areas of Demand, Supply,
Collaboration and Performance Measurement were developed specifically
for the needs of consumer product companies. Those applications include
Demand Planning; Enterprise Forecasting; Inventory Planning; Replenishment
Planning; Optimized Orders; Production Planning; Production Scheduling;
PrescientConnections, a solution for collaboration that allows multiple
parties manufacturers, wholesalers and retailers to oversee and participate
in SCP; and Knowledge Foundation, a supply chain performance measurement
suite that pulls pertinent information from supply chain applications
and back-office systems, including Sales and Operations Planning, and
delivers the information to decision-makers in an actionable form.
existing customer list consists of more than 100 companies including Binney
& Smith (Crayola Brand), AAi.FosterGrant, Interbake
Foods and Wyeth Consumer Healthcare. The vendor claims that
their customers have seen measurable results within an average of 90 days
after buying Prescient Systems' solutions.
Ross's recent announcement of the company's 4th quarter 2002 results,
which included the 6th consecutive profitable quarter, and software license
revenue growth of 26% over the prior year's same quarter, Patrick Tinley,
Chairman and CEO of Ross Systems stated "We are pleased with our growth
in North America, Europe and Asia Pacific. Our success has come from a
combination of new customers in the food and beverage, life sciences and
natural products industries and additional products to existing customers."
the recent period of its financial recovery that strangely coincides with
the worldwide economic slump (see Ross
Systems A Bright Spot On A Difficult Enterprise Application Landscape)
one should also note that a significant portion of Ross' ever growing
license revenue has come from new customers. These might mean continued
direct victories over the above-mentioned fierce and revered opponents,
some of them (e.g., SAP) reporting a notable decline of process industries
related revenue. We see the Prescient partnership as a way to continue
the partnership, Prescient Systems gains access to Ross's sizable user
base plus access to international markets. "Expanding Prescient's global
reach is just another step in our plan to deliver the best supply chain
planning solutions to the process industry, especially the consumer goods
market," said Jane Hoffer, president and CEO of Prescient Systems. "In
difficult market times, we remain ahead of plan and are on target to surpass
100 percent year-over-year growth for 2002. In the second quarter alone,
we signed five new client wins, in addition to ongoing upgrades and add-ons
with existing clients."
distribution strategy includes support for over 3,000 customers worldwide,
as the company sells and supports customers in over 60 countries. Currently
iRenaissance is available in 18 languages including localized versions
to account for local country issues like taxation, local business practices
and regulatory issues. Ross's products have been designed specifically
for food and beverage, life sciences, chemicals, metals, natural products
and other process manufacturers. The Company's iRenaissance family of
software solutions is a comprehensive, modular suite including traditional
and Internet-enabled enterprise resource planning (ERP) components such
as human resources (HR), financials, materials management, manufacturing
& distribution, plant asset & maintenance management, transportation management,
plus supply chain management (SCM), customer relationship management (CRM),
electronic commerce, business intelligence (BI) and analytics applications
the above modules are following in the footsteps of their ancestry being
designed specifically for process manufacturers particular needs. To that
end, Ross is adding functions to meet the new CFR 21 Part 11 (Code of
Federal Regulations Title 21) for life sciences, and food & drug administration
(FDA) safety functions for the food and beverage industries. Other functional
features aimed at handling process manufacturing idiosyncrasies would
be support for concurrent units of measure (UOM), pro-active shelf life
control, non-linear process costing and supply-chain wide lot genealogy,
to name only some.
As for the e-business side, the product also includes digital marketplace
applications spanning procurement, sales, Internet trading exchange connectivity,
supply and demand chain collaboration and employee self service (ESS).
A part of the company's recent success stems from sales of add-on applications
for iRenaissance suite, which makes use of an eXtensible markup language
(XML)-based middleware layer to facilitate trading partner connectivity,
and ties into Ross's iRenaissance Customer Portal offering. Ross
customers can use the portal to, e.g., publish product catalogs, and facilitate
on-line order entry, order inquiry, and billing status functions.
for technology, the iRenaissance architecture is really flexible and open
as it supports XML, the emerging Microsoft .NET architecture, and
the Simple Object Access Protocol (SOAP). Look for more Ross' announcements
with regard to incorporating Microsoft's BizTalk integration server
product, as well as further use of Microsoft's .NET Web services framework
across the entire product range in the future. Supported platforms include
Windows NT and various flavors of Unix, but the focus going forward will
be solely on Microsoft technologies.
the obvious process industry focus which remains the key tenet of its
success (see Ross
Systems' Focus Yields More Value For Process Manufacturers), Ross'
trumps would be the its global reach, with notable multi-national (e.g.,
multi-currency, multi-language support, etc.) product capabilities, and
its well-attuned value proposition for mid-market customers (i.e., a 'one
stop shop' stance, with unimpeded rapid implementations and product flexibility).
The company, nevertheless, faces the challenge of delivering its ambitious
undertaking of rounding up its product functional offering while keeping
it technologically up-to-date, and while providing migration strategy
to its existing customer base, particularly large older' Unix-based customers.
Ross customers looking to improve their supply chain planning should place
iRenaissance SCM on their short list. Enterprises in the food & beverage,
chemicals, life sciences, metals and natural products industries worldwide
looking for a complete solution should place Ross on their long list.
The company has achieved a good track record within companies having annual
between $30 and $500 million, although it has had successes with larger
companies as well, including Alcoa and Eli Lilly. Existing
Prescient customers looking for ERP should place Ross on their short list.
that fall in the general category of "process" manufacturing but do not
fall within Ross' target markets should still consider Ross for their
long list. However, they should be careful to evaluate iRenaissance at
a detail level to understand the potential fit for their needs. Existing
Ross customers should be active in the special interest groups to continue
to push Ross into greater functionality for their industry.
is suggested that evaluations of Ross and all other vendors be conducted
at a detail level, looking at not only what a vendor does, but also how
it does it. Most vendors claim to support certain industry-endemic functional
features, which they may indeed do, but how they do it varies greatly
(with many buts and ifs' as the process fit-gap analysis unfolds). Only
by looking closely at "the how" aspects during the process of scripted
software demonstrations can any company understand which vendors can meet
its specific demands.
Prescient and Ross need to work hard to gain the maximum advantage from
this relationship. Both need to turn up the volume on their marketing
to more effectively reach their highly targeted markets.