Tuesday, June 1, 2010

SYSPRO - Awaiting Positive IMPACT From Its Brand Unification Part Two: Market Impact

Last fall, SYSPRO, a privately held global provider of enterprise software for small to medium enterprises (SMEs), with its US headquarters in Costa Mesa, CA (www.syspro.com), announced a new global brand, representing the culmination of more than 18 months of extensive internal market research and preparation. To optimize brand awareness and increase market penetration, the company, SYSPRO and its product, IMPACT Encore, has been branded under the unified SYSPRO name.

SYSPRO belongs to an esteemed group of Tier 2 vendors that have been making Tier 1 vendors' strides of intruding the mid-market not an easy task. At least, the presence of the likes of Syspro, which offer a breadth of products with functionality that is often equal to the upper range of products, but at a much lower cost and implementation effort levels, has forced the bigger brethren to abandon their initially non-flying strategy of selling merely watered-down versions of their flagships products, and to attempt different tacks like the acquisition of an akin product (see SAP Tries Another, Bifurcated Tack At A Small Guy).

While small and midsize manufacturing and distribution entities may indeed covet easier implementations and lower price applications, they will nonetheless settle for less functional software to run their businesses. Also, while mid-market companies incline toward effectively packaged applications that are easy to use, require less skilled resources, and are reasonably low priced, the idea that these companies should settle for a pure-vanilla product rendition has increasingly become a fallacy. Since many Tier 1 applications vendors have increasingly been targeting the same market segment one should expect the bar to be ever raised. Such could be the case of PeopleSoft, which has lately avoided a cookie cutter' implementation approach for SMEs, as each of its mid-market solutions is preconfigured to reduce cost and complexity, but also allows for available extensions based on each customer's need, given the vendor has also developed industry templates for each solution (see PeopleSoft Internationalizes Its Mid-Market Forays).

With its latest moves, SYSPRO seems to have braced itself well for the bigger brethren's onslaught. Although it has been present in the market since 1978, SYSPRO has not been a very vocal and marketing-savvy vendor internationally, but the latest brand unification move may prove that the company is also changing its marketing approach, starting with clearer worldwide prominence and unequivocal identity. Namely, after almost one quarter of century, the vendor has ditched the IMPACT Encore from its name, hoping to build more market recognition exclusively under the common SYSPRO brand This is in addition to extending the scope of its product line to provide a comprehensive extended enterprise and supply chain solution.

This is Part Two of a three-part note.

Part One detailed recent SYSPRO announcements.

Part Three will cover Challenges and make User Recommendations.

Strengths

Despite earlier dual monikers, SYSPRO product is one of the most widely used ERP solutions within the small-to-medium enterprises (SMEs), with over 6,000 customers, rendering it a serious incumbent in the SME discrete manufacturing and distribution market. The vendor has from its early days had a sole focus on the lower-end of the ERP discrete manufacturing and distribution market, which has pragmatic requirements of inexpensive but flexible products, fast and simple implementations, and good service and support. It has additionally achieved good coverage through its indirect channel, which is an important criterion for long-term success in the SME market segment. Not withstanding this, SYSPRO has sites across tier 1, tier 2 and tier 3 environments, enabling it to become a potential challenger in both larger and smaller organizations.

SYSPRO has worldwide operations and its software is marketed worldwide through offices in the US, Canada, Africa, Australia and the UK. As a result, its products have been installed in 50 countries, and it continues to offer its products and services through the reseller channel/value added resellers (VARs), which has also expanded during the last few years. The former flagship IMPACT Encore system, has traditionally covered the full spread of modules for single and multi-site manufactures and distributors, including accounting, order processing, inventory management, purchasing, materials requirement planning (MRP) including finite and infinite scheduling, shop floor control, data collection, and payroll (integrated with the ABRA payroll system), with the above-mentioned survey testimonies and common recognition for high levels of customer satisfaction. And, with the release of SYSPRO 6.0's new above-described capabilities in business analytics, workflow, CRM, and advanced planning & scheduling (APS) , the vendor boasts an expanded control beyond the four walls of the factory/warehouse.

SYSPRO functionality is equitably solid in accounting, manufacturing and distribution areas. Although its forte should lie within its manufacturing and distribution modules, by adhering to exacting standards like International Accounting Standards (IAS), Financial Accounting Standards Board (FASB), and eXtensible Business Reporting Language (XBRL), SYSPRO can often be competitive even for enterprises that would only need the core financial and accounting functionality. The above all-rounder trait often comes as advantageous compared to competitive products that are either mainly strong in accounting (e.g., Microsoft Business Solutions (MBS), Softline, BEST Software and ACCPAC) or conversely in manufacturing/distribution (e.g., Lilly Software, QAD, Glovia and ROI Systems).

Although SYSPRO is a comprehensive ERP solution for small- to mid-sized enterprises, the company has for some time been striving to also become a nearly total solution provider of extended-ERP applications. To this end, as mentioned earlier, it has expanded its solutions footprint with SYSPRO 6.0's latest enhancements and nearly 50 modules available (allowing customers to only purchase what they require) throughout the realms of ERP, APS, CRM, warehouse management system (WMS), Business Analytics and Collaborative Commerce, many customers' requirements could be addressed with this product suite.

With a slew of manufacturing capabilities including features for quotations & estimating; master scheduling; finite capacity planning & scheduling; order management; real-time shop floor control; work in progress (WIP), labor performance; cost accounting; lot, serial and warranty tracking; purchasing/receiving; engineering change control (ECC); backflushing; material verification; capacity and material requirements planning (CRP/MRP); returned goods management; vendor approvals; blanket sales orders and purchase orders; and so on, the software is fit to support both short and long production runs in various manufacturing environments. SYSPRO can, therefore, often offer one-stop-shop functionality for many versatile discrete manufacturing environments (i.e., from forecasts driven, repetitive make-to-stock (MTS), made-to-order (MTO), assemble-to-order (ATO), configure-to-order (CTO) to custom job shop, including mixed-mode/hybrid manufacturing), as well as batch process manufacturing in the low-end of the market.

Another important strength against most of its competitors SYSPRO would have is its international nature. Unlike Sage/Best Software, Softline, Exact Software, and Microsoft Business Solutions (MBS), SYSPRO is a single product line that operates on an international basis, whereas many others have multiple product lines through acquisitions, which they pasted together around the world but which, as a rule, are unable to work with one another. Moreover, its strong multi-site and multi-national product capabilities are stronger than those of many locally competitive products (e.g., Made2Manage, Lilly Software, ROI Systems, etc. in North America), which have also resulted in its much more evenly distributed revenue per geographic regions.

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