The entire field of account software has been well ploughed and tilled by vendors, resellers and consultants in the last few years-starting with the Y2K scare scenario and then the very real euro conversion at the turn of this year. You would imagine that the market for upgrades and migration to new packages must have been well and truly exhausted leaving only scraps of start-up new business for this highly competitive sector to feed on. Not so-the new buzzword is ‘integration’ and apparently everybody has to have it.
It is fair to say that accounts software never has been a set of standalone applications, except where constrained by the technology. Routine and automated exporting of figures to spreadsheets, for example, has long since been a management staple in most businesses. Stock management is an area that is always an optional extra module in accounts packages because it has special requirements. But reflecting sales and deliveries in the stock control software is also long since routine, most often aimed at helping to avoid out-of-stock situations by triggering re-ordering at preset thresholds.
So far, so simple. But in today’s e-commercial world there is an increasing range of applications within and between organisations which would benefit from integrated connections with the core accounts functions. Customer Relationship Management is an obvious one because knowing what the customer has bought in the past, current account position, credit limits, etc. is clearly valuable if not essential for sales people, on the road or on the phone. Supply chain management may be between partners and involve principally the smooth running of orders and fulfilment but both parties need to know about financial aspects from time to time. SCM still involves supplier/customer and debtor/creditor relationships, so triggering of payments may be as important as the triggering of top-up supplies to factory or distribution warehouse or supermarket shelf. As for Enterprise Resource Planning, that stalwart old warhorse of enterprise applications, most of the big boys like SAP and JD Edwards have had the financial functions integrated within their overall suites from the beginning.
The glamour bit these days is, of course, to do with the Web and e-commerce and all of that. ‘Back office’ has become a sort of all-purpose buzzword to indicate all of those dreary administrative matters that have to be sorted before the glories of e-commerce can dawn-sales order processing, payment receipts, order confirmation, stock and delivery, and so on. Normal business admin, in other words. Just a little less glamorous and arguably much more important in an Irish current context is mobile access to back office systems. Giving the sales or delivery person in the field the ability to look up customer records or credit position, check stock levels or simply to enter orders is invaluable. It ranges today from full Web access using laptop and modem to a PDA and mobile phone with simple, standard data exchanges that are easy and quick to use in busy real life situations.
‘It’s really back fairly and squarely at getting more efficient,’ says Liam Mullaney, managing director of market leader Sage in Ireland. ‘Business needs to gain that efficiency through simple solutions. Most of our customers are in the range from larger SMEs on down. They need cost-effective technology that is easy to deploy and use. They do not want to get involved with consultants and long implementation programmes and all of that.’ He suggests that in the past three or four years many SMEs invested in Web sites and dreams of e-commerce. ‘Now they are stuck with out of date Web content they can’t manage themselves and probably feel stung and very wary. Very little business to consumer e-commerce has really succeeded in this country in the SME sector-so far. Sage believes in the e-business evolution-it will all come, but much more slowly than the early hype promised.’
Fundamentals
He points to the Sage range of products, all Web enabled or with modules that can be easily added, such as its Web Builder and Web Trader, and run by users after a couple of days’ training. ‘Yet a better example of what is principally happening today is Sage Contact Manager. It is fully integrated with Line 50 and enables a business to get straight into the fundamentals of CRM with a single view of the customer, accessible by anybody. That can be deployed instantly, right out of the box, and is intuitive to tailor and use in the way the business wants to.’ The real point, he insists, is not to extol the virtues of his specific product but to emphasise that the kind of integration with accounts systems that smaller Irish businesses need and appreciate is very practical and mundane-but technically smart.
The phrase ‘back to basics’ crops up again and again talking to people who are dealing in accounts and financial software. ‘There are no rushed deadlines like Y2K and the euro and businesses are looking for best value and systems that will carry them securely into the future,’ says Charles Alken, director of Quantum Accounting, consultants and Pegasus distributors. ‘Our view is that in any business it is essential-and always was-to get the accounting architecture right in the first place. That means solidly designed and set up to suit the specific business and its needs. All of today’s new preoccupations-CRM, mobile, e-commerce, etc.-are essentially just additional tool sets. It is the quality of the underlying accounts software in managing the business that is most important. There is little point, for example, in automating purchasing through a supply chain if the ordinary ordering system is not right in the first place.’
So what are Quantum’s clients investing in these days? The Aesop mobile business solution figures very highly, apparently, with the Prospect sales and CRM application close behind. Both are designed to integrate readily with Pegasus Opera. So is the company’s new Credit Commander package, which Charles Alken is convinced will be the real winner. Developed in response to customer feedback and based on Quantum’s own credit control system, this is a highly focussed tool directed at that constant business imperative-getting the money in.
Back to basics
That ‘back to basics’ theme is taken up again by Alan Connor, sales director of Exchequer Software, who says it is really related to the Return on Investment argument because a business needs to be convinced of why it should move on to something new. ‘Integration has really been with us for a long time but newer technology means it can be exploited cost-effectively in Web e-commerce, CRM, automation, the supply chain and particularly in mobile. Mobile is probably where we are seeing most interest because linking the sales person or van driver back to base is so clearly a valuable new business tool.’
Exchequer has been particularly pro-active in promoting XML and worked on the early eBis standard specifications with TAS and BASDA. ‘The XML specs have had to be written for the lowest common denominator,’ says Alan Connor, ‘and anyway XML is essentially a flat file document so it cannot hope to deal with all of the variations of accounting systems. But if it cannot yet deliver e-commerce from A to Z it can certainly cope fine with A to D! The important thing is that business gets on with using it and the exceptions and variations will be taken care of over time.’
In the retail world software integration has progressed further than most other sectors because the multinationals and multiples involved have been early adopters of ERP and then SCM for over a decade. Alpha Landsteinar is the Irish arm of a major Navision reseller and managing director Mark Bryans points out that integration is well established at the top end of applications, especially in the retail sector in which Landsteinar has specialised. ‘Navision has well-established links with SAP and JD Edwards ERP systems, for example.
In the retail applications field there can be complete unity from the POS till to the LAN to head office and over multiple locations giving management a 360 degree view of the business-in good time and even in real time.’ Integration between systems is not necessarily all that difficult technically, Mark Bryans says, because it mostly consists of file import/export and standards such as ODBC between databases, XML increasingly for a lot of elements and even APIs (Application Program Interfaces) between consenting software developers.
‘Clients have embraced open systems in recent years because they have been trying to get away from the past where you bought from one source and it all worked together but perhaps not all of the elements were the best. Alternatively, you bought one system to look after this and another to cope with that-and then had a real job to get data from one to the other and in fact manual updates were not unknown. Now it is genuinely possible to go for ‘best of breed’ solutions that will integrate with each other within your overall IT infrastructure. Navision is happy to compete in this open market because it is quite unique in its flexibility and development capability and all of its components have been designed with integration in mind.’
The notion that in an integrated system nothing should ever need to be keyed in twice is extended by Dan Egan, business development manager of Dublin software house, Mentec, which has successfully sold its Agresso accounting system through the LGCSB to all but two of Ireland’s local authorities: ‘Let other people do the work where possible-customers entering orders in your system keeps them happy and saves you labour. If you are ordering, you should be able to punch out from your system into your supplier’s catalogue and requisition what you want directly. The real success for e-commerce will be this B2B capability that is just becoming a reality.’
History shows that the fax only became successful when the fax machine was widely available at an economic price, Dan Egan points out, arguing that similarly B2B processing can only become widely used (and thus successful) when there are a large number of computer applications installed with B2B capability. ‘The key to B2B success is the XML standard for the exchange of transactions between disparate systems and the economies gained in terms of labour, cost and time for automated processing of transactions will be significant. The emergence of Microsoft Business Solutions and the .NET strategy is likely to create a significant marketplace in which B2C and B2B e-commerce will become the norm.’
Until Ireland
All of which is all very well, as the man said, until you get to Ireland and the real world. While the current international buzz is about more integration, internally to back office functions or externally to facilitate e-commerce, at least one Irish company is taking a distinctly contrary approach. Mike O’Grady of Galway-based Aquila Technology, developers of the Artemis Accounts II package, believes that for most small businesses the back office is where the tea is made! He suggests that the addition of lots of bells and whistles has served to distract from the primary task and points out, a touch cynically, that ‘In the run-up to Y2K and the introduction of the euro, for example, many mainstream accounting packages could automatically receive and issue invoices and handle electronic payments-great-yet still extensive re-work and ‘patching’ were needed to handle Y2K and euro compliance.’
Aquila Technology believes simply that the entry-level accounts software market is not yet ready for e-commerce. ‘In fact the additional complexity resulting from the current trend means these businesses are paying more for features they are unlikely to use and-probably more importantly-there is a longer learning curve for the first-time user.’
Seventy-user site Aquila may be small but, oddly enough, very similar opinions are expressed by 7,500 client, Irish International Sales. One of the leading Take Five resellers with a current 550 accounts, it bought the acclaimed entry level Big Red Book last year which had 6,684 users as we went to press. ‘We have been seeing sales of 150 a month and more this year, all small businesses converting from manual systems,’ says CEO Marc O’Dwyer. ‘These are owner-managers who have three overriding concerns at all times-Cash In, Cash Out and VAT Liability. That’s what they need-and in a simple sense all they need-to run their businesses profitably.’
Even with the somewhat larger clients using Take Five, Marc O’Dwyer says, businesses are simply looking to get as much as possible out of what they have already invested in. ‘They want modules to add value-and of course that includes e-commerce elements for some of them-but we have far more demand for Job Costing recently, which simply suggests that they are all getting a bit more professional. By and large what they all want is to build on the familiar and not to complicate their lives unnecessarily.’
Last words must go to Dennis Keeling, long serving chief executive of BASDA (Business Application Software Developers Association): ‘One suspects that “integration” is yet another of those things that the software industry likes to consider a major issue-as opposed to what the users think! All account systems do debit and credit as they are supposed to. After that, most users think of ease of use before functionality. They want flexibility, the ability to work the way they want to, and will look for bolt-on additions to their present systems to give more or better information or cope with new things-such as e-commerce. Sometimes the industry forgets what the customers want-‘Business Process Re-engineering’ was a blatant late-90s attempt to make business fit the systems rather than right way round.’
Accepting that XML, for example, is short of perfect as a solution to e-business Dennis Keeling points out that it universally handles 10 document types including the all-important order and invoice. ‘Most common packages can now handle that comfortably, so really the technology is not a problem and let’s get on with it because it will all take three or four years to mature anyway.’
Enter Microsoft, Upstage Centre
The acquisition of US accounts software firm Great Plains by Microsoft a couple of years ago made comparatively little impact on this side of the Atlantic, except that it showed clearly how comprehensively Microsoft was aiming to dominate the desktop. It also brought 250,000 businesses well into the Microsoft fold. With a small user base on this side of the Atlantic (a few dozen in Ireland) the market here was not upset. But earlier this year, Microsoft added Danish software house Navision which has a serious 136,000 user site footprint in 30 European and other markets. Both products have excellent quality reputations and are technically sophisticated, mid-market packages. They have been traditionally successful in what other economies call the ‘medium sized’ sector with several hundred employees and upwards. This, of course, is precisely where volume progress is about to be made in e-commerce according to all forecasters and fits firmly into place in the Microsoft .NET strategy.
Under the leadership and umbrella branding of Microsoft Business Solutions, suddenly we have business application offerings across the board because Great Plains and Navision bring with them or in their train CRM, ERP, SCM, e-commerce and even payroll. Recent US market announcements under the Microsoft banner include Professional Services Automation and Retail Management System while Small Business Manager (a Great Plains product) has had a reasonably successful first year in its home market. Now the full Microsoft portfolio of financial and business management applications goes all the way from the SME Irish-style and point of sale to multinational supply chain e-commerce.
Speaking to ComputerScope a short while ago Dean Carroll, Business Development Director of Microsoft Business Solutions on this side of the Atlantic, was very clear about the importance of this new range of products for Microsoft: ‘We spent over $2.5 billion on these two acquisitions, the second and third largest Microsoft has ever made, and we are committed to supporting them with major R&D budgets on an ongoing basis. We are in this market for the longer term and our stated objective is to create unified, global solutions.’ There is no doubting the market power of the Microsoft brand. As Dean Carroll says, ‘In a difficult IT market when businesses are thinking about applications and solutions, they can look to the strength of Microsoft,’ adding that even in the current downturn it is planning to add another 7,500 specialist staff to its operations worldwide.
He echoes the theme of ‘integration’ and suggests that the kind of efficiencies that ERP systems have created within the enterprise can begin to be created across all forms of business. ‘Integration capability is being built into the architecture of all of our products, expanding outside of the organisation to take in trading partners and others as we move into a new open world of XML and Web services. Clearly, we see .NET and .NET Server in the enterprise as enabling that next wave of more effective integration.’ He asserts also that Microsoft now sees XML as a proven technology that needs the market opportunities to allow it to evolve. At the same time he believes that delivery of the e-business vision is likely to be over a five to seven year time scale.
Great Plains and Navision will continue to develop as separate product sets on parallel tracks over the next few years at least. ‘We will invest to expand and enhance both,’ says Dean Carroll, ‘and we have the R&D bandwidth to do that. Customers today want to add new functionality and modules to their current investments. Much of that next generation will be .NET based which is where the interconnections and integration will happen.’
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