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SYSPRO is a 35-year-old software vendor that focuses on selling enterprise resource planning (ERP) systems to midsize companies, particularly those in manufacturing and distribution. In manufacturing, SYSPRO supports make, configure and assemble, engineer to order, make to stock and job shop environments. The company attempts to differentiate itself through vertical specialization and its years of ongoing development, which can reduce the need for customization and cut the cost of initial and ongoing configurations to suit the needs of companies in these industries, thereby reducing the total cost of ownership. Worldwide its targeted verticals include electronics, food, machinery and equipment and medical devices; in the United States, SYSPRO adds automotive parts (original equipment and after-market) and energy. The company’s development efforts follow a design philosophy that balances its target customers’ need for software capabilities that are on par with larger enterprises with their resource constraints (chiefly limited financial resources and technical staffs). Its software can be deployed on-premises or in the cloud.
The ERP system is a pillar of nearly every company’s record-keeping and management of business processes. It is essential to the smooth functioning of the accounting and finance functions. After a decade of stasis, the evolutionary pace of technologies that shape the design of ERP systems began accelerating over the last couple of years, as I have noted. Reflecting this trend, SYSPRO recently introduced new capabilities to
- Facilitate business process collaboration and information retrieval
- Provide integrated customer relationship management functionality
- Enhance the user experience
- Expand its Web hosting offerings.
Because almost all business processes require collaboration, users of ERP systems need to work with colleagues in performing some functions within the application itself. In the past this typically required using email or a third-party instant messaging service, but recently vendors have started to incorporate collaboration services in their application suites. To this end, SYSPRO has added Harmony, a cloud-based platform that enables internal and external collaboration (the latter to interact with suppliers and channel partners). Harmony also facilitates the use of data analytics and reporting, which is helpful because it hasn’t always been easy to get information and insight directly out of ERP systems. In our Office of Finance benchmark research fewer than half (48%) of companies said they find it easy to get information from their ERP system. SYSPRO has added new predictive search capabilities to quickly provide the most relevant answers. Its Web “robot” enables users to interact with SYSPRO’s applications using a natural language approach. For example, writing “Show me all invoices from ABC Co. over the last 12 months” will retrieve those records.
SYSPRO’s new CRM application enables companies to manage pipelines and marketing campaigns as well as handle service contracts. It also integrates with Microsoft Outlook to facilitate contact management. In its initial release the capabilities are basic, but it will likely meet many companies’ customers’ requirements. It has the advantage of being an integral part of the system so its total cost of ownership can be lower than that of similar systems. It is available as a cloud-based, multitenant offering or can be installed on-premises. The mobile version has a responsive user interface design that adapts to the specific device on which it’s running.
Keeping with an industry trend, SYSPRO has worked to simplify its user interface. Its Workbench UI is designed to make it easier for companies to tailor screens to the specific needs of individuals based on their roles or tasks without the help of a professional developer. Self-service configuration is an attractive capability for midsize companies because it reduces the cost of ownership and provides the application with greater flexibility when roles or processes need adjusting to meet changing business requirements.
SYSPRO provides customers with two basic cloud options. Its BusinessLive software as a service is a subscription offering that fully outsources the operation of the application and requires no capital outlays. Customers also can use SYSPRO to host their licensed software and avoid having to perform routine software maintenance or take care of hardware and security. SYSPRO recently added Microsoft Azure as an option for managed service in addition to Amazon Web Services.
As I’ve noted, deciding when to replace an ERP system can be complicated. Usually, companies need to do it because the business has outgrown (or will soon outgrow) its capacity to handle transaction volumes. Another trigger can be when it becomes too difficult to configure it to specific requirements because the company’s business model has changed significantly, it had to adjust its go-to-market strategy, added a new product line, expanded geographically or made an acquisition. I recommend that companies that operate in SYSPRO’s target industries and are considering replacing their existing ERP system evaluate the company’s software. Its ERP suite is functionally rich, and the company has demonstrated a commitment to protecting its customers’ investments by its dedication in applying technology advances to its applications.
Senior Vice President Research
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Intacct, a cloud-based ERP vendor focused on midsize companies, recently held its annual user group meeting. Two of its products that were covered in the keynote are worth noting. One, already available, enables companies to manage their order-to-cash process in a continuous fashion, from the time a salesperson begins to engage with a prospect to the time funds are collected. The other is a custom report writer, to be available in the first quarter of 2017, that will provide business users with the ability to create even complex reports from any data that resides within Intacct in a straightforward, interactive fashion that is similar to building reports in a desktop spreadsheet. The company also presented modules that will facilitate compliance with the new revenue recognition standards.
Companies that offer their products or services through a subscription can find themselves challenged. Unless the subscription is a single item and is never adjusted (for example, a magazine subscription), keeping track of the items covered by the contract and its terms and conditions and billing for them accurately can be time-consuming because the relevant information often is scattered across multiple applications. Often, customers make adjustments to their services during their subscription period: the add or reduce the number of users or the type or amount of services. When changes take place, the adjustments may not be recorded in all applications at the same time or consistently. Since desktop spreadsheets are the most common way companies bring together the information needed to create their subscription invoices, those that want to be certain that their billing is accurate will always need to perform checks and reconciliations, which is also time-consuming.
Our benchmark research on recurring revenue businesses finds that only 29 percent of those in accounting roles are satisfied with their process for invoicing and billing. The issues that accounting departments face here are likely to be underappreciated by the rest of the company – the same research shows that nearly half (47%) of participants working outside of finance and accounting said they are satisfied. The gulf between the two groups reflects the reality that when parts of a business process are performed without regard to their impact on finance department operations, invoicing becomes a highly labor-intensive effort. Indeed, of those not satisfied with their invoicing, four out of five (79%) said it requires too much work, two-thirds (68%) said it involves too many resources, and more than half (54%) said it takes too long.
Intacct’s Contract Billing for CRM addresses these issues by enabling companies to maintain data integrity over the entire sell-to-collect process, from the time a salesperson engages with a prospect through collection. Doing so eliminates the possibility that billing mistakes will occur because of discrepancies between data sources caused by inaccurate rekeying of data or inconsistencies between data sources that can occur because changes to the subscription are not recorded in all systems at the same time. Contract Billing for CRM has native, built-in connectivity between Intacct and Salesforce CRM applications, which creates a continuous workflow from the start of the sales process in Salesforce to billing and collection with Intacct. Throughout the process, the system maintains a single authoritative source of data.
Being able to manage a process and associated data from end to end is one of the pillars of an approach to managing finance departments that we call continuous accounting. This approach uses information technology to increase the efficiency of the department while enabling it to play a more strategic role in company operations. In this case, Contract Billing gives sales and marketing organizations greater flexibility in designing service offerings and related terms and conditions to meet market demands because the system can do so without increasing accounting department workloads.
As a result of imminent changes to accounting standards, which I have discussed (ASC 606 in the United States and IFRS 15 in most of the rest of the world), companies that do business through contracts – whether for a single transaction or a subscription – will find accounting for them more complicated beginning in 2017. As I’ve noted, whether it’s a one-off deal or an ongoing subscription, managing sales contracts on an end-to-end basis can greatly simplify accounting for contracts and substantially reduce the chance of errors occurring.
Also featured in the keynote was the custom report writer, which is due to be generally available in the first quarter of 2017. Although it isn’t as easy to use as a spreadsheet, it appears to require only a modest amount of training and a bit of experience for a business user to become productive. As a result, the trade-off between some up-front effort to save a considerable amount of time on an ongoing basis seems worthwhile. The experience is rather spreadsheet-like in that it enables business users to create and format a report on a “design canvas” in an interactive fashion. Starting with a basic report, users can keep adding details in a preview mode (such as fields or dimensions such as sales territories or product families) and immediately see the results of the modifications, which is similar to what they experience in using a desktop spreadsheet. Business users also can quickly modify the report whenever conditions require changes. Creating periodic reports using this tool can save a considerable number of hours every week month or quarter compared to creating them in a desktop spreadsheet.
Moreover, a report created in the custom report writer will be able to access any data that’s in Intacct. This includes not only accounting data but also data stored in what the company calls “custom objects.” These objects could contain any sort of information that wouldn’t necessarily be recorded in an accounting transaction but would be useful in creating company reports or analyses. A custom object might, for example, be a list of the company’s owned or leased facilities, their size and location, rent or mortgage payments, taxes and any other information that individuals with a facilities management role might maintain in a desktop spreadsheet. Intacct makes it straightforward to import the data from such a spreadsheet directly into a database table named Facilities. The facilities management group can then easily access and update this information as needed. Keeping scattered company information in Intacct rather than in spreadsheets makes the data more accessible and secure for everyone in the organization. And once it’s available in Intacct, companies will find it much easier to analyze and report on a combination of financial and other types of information.
I recommend that midsize companies that are considering changing their ERP system, especially those that have a subscription or recurring revenue business model, evaluate Intacct. Larger companies that have use a subscription business model for part of their revenues also should consider using Intacct as a sort of subledger to manage the accounting for this part of their business since it could save them a considerable amount of effort in accounting as well as provide greater flexibility in creating products or offerings.
Senior Vice President Research
Follow Me on Twitter @rdkugelVR and
Connect with me on LinkedIn.