ERP Market

Introduction:

SAP AG is at the beginning of a new growth curve similar to the one it experienced in the early 1990s. SAP is the world's largest business-software maker by revenue, ahead of U.S.-based rivals Oracle Corp and Microsoft Corp. It took the top position with its so-called enterprise resource, or ERP, software product R/3, which was launched in the early 1990s.

ERP became a big hit in the last decade as companies were able to run their business more efficiently by using the software to replace staff working in back-office functions such as administration. On the back of the ERP boom in the 1990s, SAP went from a company with $255 million in annual revenue at the beginning of that decade, to $1.4 billion in the mid-1990s, to $6.3 billion in 2000 with annual growth rates ranging from 18% to as high as 66%. SAP currently generates around $10 billion in annual sales.

The next growth wave is coming from software that enables companies to link up their back offices with those of partners, again automating a process that is largely done viahuman contact such as procurement officers. Software launched last year by SAP -- MySAP 2005 in combination with its software platform NetWeaver -- is SAP's flagship product to ride the upcoming wave.

SAP last year set a target to triple its customer base to 100,000 by 2010, as it aims to sell more software to smaller companies with annual revenues below $1 billion. Traditionally, SAP sells software to major firms like Wal-Mart Stores Inc. in the U.S. or German BMW AG. SAP has set its hopes on a new software product for smaller companies.

The ERP market is a very competitive and fast growing market. According to AMR Research Inc., the leading industry and market analysis firm specializing in enterprise application and enabling technologies, the Enterprise Resource Planning (ERP) software market will grow at a compound annual growth rate of 37 per cent over the next five years.

AMR Research attributes the continued growth to three primary factors. These are:ERP vendors are continuing to expand market presence by offering new application such as supply chain management, sales force automation, customer support and human resources.

To sustain their rapid growth, ERP vendors have to sell more licenses into their installed base. Currently, ERP vendors will try to sell more licenses into their installed base. Currently, ERP vendors have a 10-20 per cent penetration (i.e. percentage of total employees currently using the ERP system). This will grow to 40-60 per cent within the next five years.

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While ERP originated in the manufacturing market, ERP usage has spread to nearly every type of enterprise including retail, utilities, the public sector and healthcare organization. Most will purchase new ERP system over the next five years, often for the first time.

The vendors in the ERP market are segmenting into two tiers and are focusing on expanded product functionality, new target markets and higher penetration rates. The top tier consists of five vendors- SAP AG, Baan PeopleSoft, Oracle Applications and J.D. Edwards.

These companies- The Big5-account for 64 per cent of the ERP market revenue and have grown over the past year at a furious pace of 61 per cent. In addition. Baan, J.D. Edwards, Oracle and People Soft are each expected to approach or exceed $1 billion in total revenue in 1998, while SAP will approach $ 5 billion.

One thing is clear; no one wants just ERP' anymore .The emerging trends in the enterprise packaged application industry are its integration with new, cutting-edge technologies, such as sales force automation (SFA) and customer management. Driven in part by the huge impact of Internet-based commerce, these new applications are leading to a seeming divergence between so-called Back Office and Front Office functionalities.

The Indian scenario is slightly different, with the Indian ERP package-Ramco’s Marshal Accounting for 9 % of the market share. According to the Data Quest Survey (Dataquest April 15, 1999), in India also, SAP is the market leader with a 20 % market share.While SAP R/3 and ‘QAD does MFG/PRO continue to dominate the Indian Market Scene, there is also an undeniable presence of lesser known breeds like J.D. Edwards and SSA’S BPCS. Other familiar stalwarts like Oracle Financials, Ramco Marshal and Baan also dominate the second and third rungs of the domestic ERP market.

SAP AGCompany ProfileFounded in 1972, SAP (Systems, Applications and Products in Data Processing), based in Walldorf, Germany is a leading global provider of client/server business application solutions. Today SAP has installations in more than 107 countries.

SAP’s ERP Package comes in two versions: 1. The main frame version (SAP R/2) and2. The client/server version (SAP R/3).

Most prominent among SAP’S product range in the enterprise application suite R/3 for open client/server systems. With SAP Systems, customers can opt to install the core system and one or more of functional components, or purchase the software as the complete package.

SAP Product and Technology:

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SAP product features a sophistication and robustness and matched by other business software solutions. SAP has developed an extensive library of more than 800 predefined business processes, spanning each functional software requirement.

The power of SAP’s software lies in real time integration, linking a company’s business process and applications, and supporting immediate response to change throughout the organizations on a departmental, divisional or global scale. The complete suite of R/3 applications is available in 24 languages, including Japanese (Kanji) and other double- byte character languages.

R/3-An Overview:SAP’s R/3 system is the world’s most-use standard software for client/server computing. R/3 enables you to respond quickly by making you more flexible- so that you can leverage changes for your advantage. R/3 helps client’s everyday business to grow, letting them concentrate on strategically expanding to address new products and markets. It gives them both a forward-looking information management system and the means to optimize their business processes.

R/3 Main features:1. R/3 employs three-tier client/server architecture: widely recognized by SAP customers, technology partners and industry analysts as a winning approach to solve some of today’s most demanding information-management challenges. The three-tiered architecture separates system into three functional layers, is structured to support the demands of its function.

a. The Database layer resides on central servers or mainframe host computersb. The Application layer holds the processing logic of the system, preparing and formatting the data for individual offices and department.c. The Presentation layer, typically on personal computers, handles all the tasks related to the presentation of data, including User interface enable easy access to complex applications and data.

2. SAP has also incorporated and integrated the intranet and Internet technologies into business solutions for its customers: Both internally and together with its partners, the company is defining and creating a number of Internet standards- based interface, applications and business processes that will extend the usefulness of SAP software in entirely new ways and to new classes of customers.

3. At R/3’s core are powerful programs for accounting and controlling, production and material management, quality management and plant maintenance, sales and distribution, human resources management and project management.

4. The R/3 system is an unbeatable combination functionality and technology. Although designed as an integrated system, R/3’s modules can also be individually. You can expand it in stages to meet the specific requirements of your businesses.

5. R/3’s runs on the hardware platforms of leading international vendors and can mesh smoothly with your in-house applications. It is quick and efficient to install.

6. Best Business Practices and new Technologies:

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R/3 software lets Client integrate all their business operations in all overall systems for planning, controlling and monitoring. Client can chose from 800 plus readymade business processes- and their number continues to grow.

7. Dynamic Information ManagementR/3 gives enterprises of all sizes and from all types of industries, a flexible software base for their business infrastructure. Moreover, the profit from the quality and powerful functionality of R/3’s application, which meet the information management, needs of both medium-sized and large multi national companies.

8. Retail companies use R/3 to boost consumer response. The pharmaceutical and chemical industries use R/3 to integrate commercial and technical applications. Banking and insurance business use R/3 to coordinate revenue and risk management and optimally manage their financial assets. Manufacturing companies use it because R/3 simultaneously supports several types of production.

9. Special enhancement to the R/3 systems, enable government agencies to make their services more efficient and cost effective. In wholesale businesses R/3 speeds up all processes-from suppliers to final customers and permits the simultaneous optimization of wholesale and consumer prices. Publishers and media take advantage of R/3’s flexibility to respond to short term changes in the market. Utilities used by R/3 to recognize their business processes and improve the quality of their services.

BAAN CompanyBaan Cornpany is a leading global provider of enterprise business software. Baan Company offers a comprehensive portfolio of best-in-class, component-based applications for front office, corporate office and back office automation. These applications are in use at over 7,000 customer sites worldwide. Baan Company products reduce complexity and cost, improve core business processes, are faster to implement and use, are more flexible in adapting to business changes and optimize the management of information throughout the entire value chain.

Founded in the Netherlands in 1978 by brothers Jan and Paul Baan, Baan Company has dual headquarters in Barneveld, The Netherlands and Reston,Virginia, United States of America. Since 1995, the Company has significantly expanded its sales and service presence in North America, Latin America, Europe and Asia.

Technology and Products:1. Baan now offers the most complete set of single-vendor enterprise business

applications.2. The foundation for Baan's products is differentiated through their open

component architecture and through the use of BaanDEM.3. Baan DEM provides a business view of the enterprise via a graphical

process/model-based view, tailored or templated to the specific needs of industry groups or individual customers.

4. Baan DEM delivers the capability to rapidly configure and re-deploy Baan Company applications from a single view, helping to ensure that the Baan Company enterprise application accurately reflects a company's most current organizational structure, business practices and operational procedures.

5. Baan's product line features multi-tiered architecture for maximum scalability and flexible configuration.

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6. Applications are isolated from the systems environment, enabling support of new hardware, operating systems, databases, networks and user interfaces without any modification to the application code and Microsft SQL Server), and are Year 2000 compliant.

7. Baan Company supports popular Unix platforms as well as Microsoft NT, and was the first solution provider in its class to earn the Designed for Microsoft® BackOffice' logo certification. Products also support major relational database systems (Oracle, Informix, DB2, Sybase

8. Serving Vertical Industries Aerospace and Defense (A&D): Baan offers specific vertical industry solutions for aerospace and defense companies engaging in multi-level projects and contracts. Baan's A&D offering includes Baan Project to enable the effective management of key functional business process areas. This unique, industry specific approach solves the problems faced by organizations engaged in large, extensive projects. Today, Baan is recognized as the leader in the Aerospace and Defense industry segment for ERP.

PEOPLESOFTCompany Profile:PeopleSoft Inc. was established in 1987 to provide innovative software solutions that meet the changing business demands of enterprises worldwide. It employs more than 7,000 people worldwide. The annual revenue for the year 1998 was $ 1.3 billion. PeopleSoft's mission is to provide innovative software solutions that meet the changing business demands of organizations world-wide.

PeopleSoft, Inc. was a company that provided HRM (human resource management), CRM (customer relationship management), Manufacturing, Financials, EPM (Enterprise Performance Management) and Student Administration software solutions to large corporations, governments, and organizations. Founded in 1987 by David Duffield and Ken Morris, originally headquartered in Walnut Creek, California, and eventually Pleasanton, California, PeopleSoft's roots began with an idea Duffield had about a "Client-Server" (then a new concept) version of Integral Systems popular mainframe HRMS package.

In 2003, when PeopleSoft acquired J.D. Edwards, it decided to differentiate its former product line with those of Edwards by renaming both products. PeopleSoft's original flagship product was rebranded as PeopleSoft Enterprise, J.D. Edwards' OneWorld ERP product was rebranded as PeopleSoft EnterpriseOne and J.D. Edwards' legacy World product was rebranded as PeopleSoft World. In January 2005, PeopleSoft was acquired in a hostile takeover by Oracle Corporation. This takeover was resisted by PeopleSoft but Oracle overcame the legal challenge and after the approved merger, PeopleSoft ceased to be an independent company, although its products continue to be used by thousands of companies.

Both the Enterprise and EnterpriseOne products are considered ERP systems and modularized into specific components: HRMS (including payroll, human resources, benefits, etc.), Financials (including Accounts Payable, Accounts Receivable, General Ledger, Asset Management, EPM, etc), Manufacturing (including inventory, purchasing, billing, order management, production management, cost management), Student

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Administration, and CRM (including helpdesk, support, and sales). PeopleSoft is well known for its ability to be easily customized, or tailor-made, to fit the specific business needs of each client, while still being generic enough to meet corporate and governmental tracking requirements. Its detractors decry the frequent bugs found in the system, which required patches and fixes. PeopleSoft — like most large software companies — spawned an industry-within-an-industry of PeopleSoft consulting, the implementation and maintenance of the product

The company's products are sold through direct sales offices and distributors in the United States, Canada, Europe, Asia/Pacific, Latin America and Africa. With award-winning customer service, PeopleSoft dedicates approximately 47 per cent of its staff to customer service in the areas of account management, product support, professional services, education services and communication services.

People soft Main features:1. Supply Chain Management—PeopleSoft has the industry's only complete enterprise resource planning solution that is built around supply chain optimization. A Demand Planning module enables sophisticated forecasting, using both real-time and historical information. PeopleSoft's complete suite of Supply Chain Management products provides comprehensive support for any organization that produces or markets a physical product.

2. Service Industry Solutions— PeopleSoft also provides a complete commercial support solution for service industries. The Service Revenue Management suite features modules supporting the tracking of time and labour, payroll processing, project management and billing, as well as expense and receivables processing. A suite of Procurement modules is also available supporting purchasing, inventory management, payables and expense processing, and asset management.

3. Industry Solutions PeopleSoft supports industry-specific market initiatives in many businesses sectors. The initiatives include industry-specific products, customization of existing applications, and sales and marketing support through direct channels and business alliances. PeopleSoft has 11 distinct business units, which provide software solutions specific to a broad range of public and private sector industries. Industry partners help make the solutions comprehensive, spanning the enterprise from the back office to the front lines.

4. PeopleTools:People Tools is an integrated set of client/server business application development and customization tools from PeopleSoft. These tools enable customers to implement, tailor and maintain PeopleSoft applications as well as to extract, analyze and manipulate data. PeopleTools includes several tools for reporting, customization and workflow.

5. Self-Service Applications: To improve productivity throughout the organization, PeopleSoft focuses on providing the occasional user with easy access to information and functionality specific to their role. They have developed a set of self-service applications to help companies quickly and cost-effectively distribute functionality throughout the enterprise over the Internet, intranets and extranets.Built with an intuitive interface based on a standard Web browser such as Netscape Navigator or Microsoft Explorer—these Java-based, cross-platform applications enable employees, customers, suppliers and other occasional users to perform self-service

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administrative tasks easily. Self-service applications are linked to PeopleSoft core product lines, including PeopleSoft Accounting and Control, Human Resources Management and Materials Management.

6. Web Client: Self-service applications use the PeopleSoft Web Client. The Web Client is downloadable on demand and runs on a Web browser across multiple platforms. Its affordability, open architecture and simplicity provides an ideal framework for delivering enterprise solutions to a large number of people. Applications don't need to be installed at every desktop; they are accessed easily through a browser. In addition to supporting self-service applications, the PeopleSoft Web Client has a Work list and Query interface to help incorporate occasional users in the How of a company's business processes and improve access to in formation.

Furthermore, all data transmitted between the Web Client and the application server is encrypted for added security. Because the Web Client takes advantage of PeopleTools, self-service applications can be deployed across the Internet or existing corporate intranets—with common business rules workflow logic and security features.

7. Partnerships:PeopleSoft has established global consulting agreements with Andersen Consulting, Deloitte & Touche Consulting Group, KPMG Consulting (a part of KPMG Peat Marwick LLP) and Price Waterhbuse LLP, four of the world's leading consulting and systems integration firms. PeopleSoft also maintains relationships with more than 150 industry-leading third-party vendors through its six Partnership Programs—Application, Database, Hardware, Implementation, System Integration and Workflow.

8. PeopleSoft Implementation Toolkit: PeopleSoft has a modular application structure, which lends itself to the use of phasing—an incremental process by which you 'bite off only what you can chew'—during implementation. Yet it allows the riskier tig bang' approach when time-critical business needs must be addressed quickly. A phased implementation helps to minimise risk and allows better resource and overall project cost management.

The PeopleSoft Implementation ToolKit in corporates four phasing strategies: 1. • Geographical Applicable when business practices and processes in various

locations are independent enough from one another to justify separate implementations.

2. Departmental Your initial phase is focused on full implementation for a given department; additional departments are made operational during subsequent phases.

3. Core and support processes Your first phase encompasses critical, core business processes; subsequent phases focus on support processes.

4. No phasing Some situations do not lend themselves to phasing. Examples include date driven implementations (regulation effective dates drive action) and formation of new business enterprises.

Client can combine their phasing choice with one of these implementation approaches: 1. As delivered: This is the simplest approach, because you implement the applications as delivered and adjust your business processes to match the system. By using this

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approach, you are in essence reengineering your business operations, with PeopleSoft functionality driving your requirements.

2. Data modification: You'll use this approach when data analysis, modification and clean-up are a primary focus of the implementation For example, if your implementation is driven by legacy data held in date storage formats that don't support the Year 2000.

3. Legacy integration: Useful when interfaces between legacy systems and PeopleSoft applications are a significant factor in the implementation. This approach includes business event analysis and early resolution of interface issues.

4. Application sequencing: Applicable when your implementation involves multiple PeopleSoft applications. Using this approach, you'll focus initially on business processes supported by the first application you implement. Then, as you implement other applications, you'll concentrate on additional business processes.

5. Business objectives and events Pertinent when, in order to meet a set of business objectives and their respective business events, your implementation also involves non-PeopleSoft applications. For example, to broadcast timely sales and collections information to the field, you would use this approach to implement a sales force automation application along with PeopleSoft Financials.

The PeopleSoft Implementation ToolKit is engineered to support various combinations of phasing strategies and implementation approaches, which we call routes. The PeopleSoft Implementation Tool Kit helps in identifying the route that best suits your implementation.

Once a route is determined, it is then used to present guidance specific to your type of implementation project. By providing route-specific project plans and guidance, the Implementation ToolKit gives you the focus necessary to achieve a more rapid implementation.

J D EDWARDS WORLD SOLUTIONS COMPANY: Company Profile:

J.D. Edwards, also called JDE, is a software company founded in March 1977 in Denver, Colorado by Jack Thompson, C.T.P."Chuck" Hintze, Dan Gregory and Ed McVaney.

The company made its name building accounting software for IBM minicomputers, beginning with the System/34 and /36, focusing from the mid 1980s on System/38 minicomputers, switching to the AS/400 when it became available.

In the early years, JD Edwards designed software for several small and medium-sized computers, eventually focusing on the IBM System/38 in the early 1980s. It was in this effort that JD Edwards pioneered the CASE software development and design tool, which lends consistency across the broad range of JD Edwards' integrated applications.

Their main AS/400 offering was called JDEdwards WorldSoftware and is popularly called World. In 1996, J.D. Edwards also launched a client-server version of their

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software called OneWorld. JDE was bought out by PeopleSoft in 2003. PeopleSoft, in turn, was purchased by Oracle Corporation in 2005.

The company had gradually been adding functions to its accounting software, evolving it into a platform-independent enterprise resource planning (ERP) application that was renamed OneWorld in 1996. This newer technology used the so-called Configurable Network Computing architecture to transparently shield business applications from the servers that ran those same applications, the databases in which the data was stored as well as the underlying operating system and server hardware.

When McVaney and Thompson began to design and implement World Software, they provided the pathway to success. By the mid-1980s, JD Edwards was being recognised as an industry-leading supplier of applications software for the highly successful IBM AS/400 computer, a direct descendant of the System/38.

With the June 1996 introduction of One World, the company once again achieved a technological breakthrough. Building on the CASE technology pioneered in the 1980s, One World combines a full range of platform independent applications with an integrated toolset. One World gives organizations the power to configure their systems and applications as their needs change. Today, JD Edwards is a publicly traded company that has more than 4,700customers with sites in over 100 countries and more than 4,200 employees.

J D Edwards Main features:1. JD Edwards is a leading provider of Idea to Action enterprise applications, encompassing flexible, integrated software for distribution, finance, human resources, manufacturing and supply chain management.

2. JD Edwards enables Idea to Action with ActivEra, a customer-centric product and technology solution that allows companies to change enterprise software after implementation, as their business needs demand. ActivEra extends the capabilities of the company's existing One World and JD Edwards SCOREX products.

3. JD Edwards offers customers the means of achieving greater ongoing control of their businesses through the ability to define and redefine the way they do business as markets, customers and competitive conditions change.

4. Value: In enabling Idea to Action, JD Edwards provides client with an appreciating software asset—one with the potential to increase in value over the life of their business. Through continual enhancements in features and functionality, architecture open to third-party technologies, and the real-time adaptability afforded by ActivEra, you can capitalise on new ideas and maintain your flexibility in the face of change JD Edwards also offer multi-currency, multi-language and multi-location capabilities, so your solution grows as your business grows.

5. Technology JD Edwards offers its solutions primarily for the AS/400 platform. JDEdwards's two application suites, One World and World Software/ World Vision, provide comprehensive supply chain management functionality across the technology continuum, from host-centric, to thin-client, to network-centric computing.

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All three can run concurrently on the same AS/400, share data and interact with each other as a unified solution.

OneWorld1. JD Edwards OneWorld is flexible enough to support an extended solution by

integrating with legacy, best-of-breed and third-party products. All this with out sacrificing the security, integrity, or consistency of the existing systems or data.

2. OneWorld's own APIs, as well as such industry standards as CORBA, ODBC and other packaged integration solutions and process ware options, ensure that you won't be locked into limited functionality and out of future opportunities.

3. OneWorld embraces change with its modular architectural foundation. The information processing is segmented into five functional elements—database, data warehouse, business objects, reporting and GUI. The users can link these elements in a variety of configurations from one tier, with every ele ment running on a stand-alone PC, to five tiers or more.

4. One can also distribute the elements geographically, departmentally, or administratively and can configure and reconfigure in the field, as requirements change. There are provisions to add new servers, even Web servers, without having to rewrite applications for the new machine.

5. OneWorld has the tools and technologies that will quickly bring archived data to light. And you can extend and supplement those technologies with solutions offered by leading industry data warehousing and decision support specialists.

6. The customer has the option to choose the data warehousing solution that he wants, rather than be satisfied with a proprietary system. OneWorld provides alternatives, so that you can choose the most appropriate solution based upon your own requirements.

7. With OneWorld, you can distribute your enterprise applications to employees, business partners and customers using web-based technology, without rewriting your applications one software version supports both client/server and Internet modes. This results in an extended enterprise that works together to support the same business tasks.

WorldSoftware and WorldVision In the age of technology change, the popularity of many enterprise software solutions is fleeting. The resulting obsolescence is frustrating and costly. It is better to have system that has the necessary functionality with built-in longevity. More than 4,000 customers have found this staying power in JD Edwards WorldSoftware. On its strength and the reliability of its host-centric IBM AS/400 foundation, WorldSoftware’s global popularity has endured in the ERP marketplace for over a decade.

Inherently flexible and easy to use, WorldSoftware readily adapts to your situation, letting you:

1. Selectively mix, match and integrate software applications from among its diverse industry product suites.

2. Easily tailor it to ongoing business, local and organization-specific requirements. 3. Add WorldVision, its advanced graphical user interface, to gain client/ server

benefits.

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4. Optionally run it alongside OneWorid, JD Edwards' network-centric solution, to gradually incorporate other computing platforms into your network.

5. JD Edwards WorldVision is a thin-client bridge that provides the graphical user interface (GUI) with a look and feel common to the PC, while protecting your investment in WorldSoftware and the AS/400.

6. WorldVision also allows you to: a. Maximise productivity by shrinking the amount of training users need. b. Make a safe move to client/server by leveraging your existing host centric

7. WorldSoftware applications. And like WorldSoftware, WorldVision is continually enhanced for the future. For example, you can have WorldVision as a Windows 95/NT style GUI for a PC and as a Java-based interface for use across the Internet, intranets, or extranets.

Common points for all ERP software----Cornpany is a leading global provider of enterprise business software. --Company products reduce complexity and cost, improve core business processes, are faster to implement and use, are more flexible in adapting to business changes and optimize the management of information throughout the entire value chain.

The company attributes much of its success to a corporate culture that emphasizes quality at all levels. --------- commitment to its product quality, its corporate culture and a customer-centric approach enable the company to deliver and support leading enterprise software solutions that solve business problems. The company's software operates in multiple computing environments, and is both Java and HTML enabled.

1. At ---‘s core are powerful programs for accounting and controlling, production and material management, performance management, quality management and plant maintenance, sales and distribution, human resources management, service revenue management and project management.

2. The -----system is an unbeatable combination functionality and technology. Although designed as an integrated system, ----- modules can also be individually. You can expand it in stages to meet the specific requirements of your businesses.

3. ---- runs on the hardware platforms of leading international vendors and can mesh smoothly with your in-house applications. It is quick and efficient to install. ------solutions run on a variety of leading hardware and database platforms, including Compaq, Hewlett-Packard, IBM, Sun Microsystems, Informix, Microsoft SQL Server, Sybase, DB2 and others. -------- delivers Web-enabled applications, workflow, online analytical processing (OLAP), etc. ----- company has customers in nearly every industry and geographic region in the world, including a large cross-section of the Fortune1000.

4. R/3 gives enterprises of all sizes and from all types of industries, a flexible software base for their business infrastructure. Moreover, the profit from the quality and powerful functionality of R/3’s application, which meet the information management, needs of both medium-sized and large multi national companies.

5. Business Management Solutions ---------- solutions extend across the globe. The applications help in man-aging a broad set of business processes, from human resources and finance to supply chain management. One can implement a single application, or

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complete enterprise-wide solution. The flexible design lets you tailor the applications to your specific needs.

6. PeopleSoft continually adds and refines technology to optimize their customers' information systems. They help customers take advantage of new and emerging technologies, giving them more choices and freedom to develop their own innovative business processes.

7. Multitier Transaction Processing: The ability to support large numbers of concurrent users, while maintaining reliable and superior performance, is critical to enterprise-wide data processing. Recognizing that ------------ in a variety of settings over local area networks (LANs) and wide area networks (WANs), throughout organizations of varying sizes there is an option of two-tier or three-tier processing. In the latter, the application logic runs on an application server instead of the client. The application server is designed to relieve the client from processing intense SQL transactions, thereby reducing LAN traffic and improving performance across WANs.

Three-tier architecture also provides increased scalability to accommodate high volumes of concurrent users while maintaining a consistent and reliable performance level. -------------continues to support its traditional two-tier architecture as well.

8. Online Analytical Processing: Companies must be able to quickly extract and analyze the information they require for effective decision making. OLAP, or online analytical processing, is a powerful method for interactively analyzing data online. -------------- integrates popular OLAP tools—including Cognos Power Play and Arbor Essbase that enable users to easily 'slice and dice' multidimensional data stored in various locations.

With the Cube Manager, users can define the data they want to extract into an OLAP cube, enabling them to quickly view information from all different angles to test conclusions, conduct what-if scenarios and compare alternative strategies. With multidimensional information presented in quick-read formats, managers can make better decisions, react faster to competitive threats and identify inefficiencies.

9. Workflow An essential part of our solution, ------------- workflow capabilities help communications companies achieve enterprise-wide integration of information, applications and people. Workflow enables a company to automate many time-consuming clerical tasks, while putting useful data into the hands of users. With workflow, the company's ---------applications do more of the work.

For example, if managerial approval is needed for a work order, the system automatically forwards the request. Workflow can also help the company track projects, by initiating a workflow message to the appropriate person when a project exceeds a predetermined cost. The company can even bring non---------- users into the workflow process, using e-mail systems and the Internet for collecting and distributing data.

10. Solutions: Business doesn't live by software alone. -------- offers a balance of technology and service options tailored to client unique industry and processes. A network of certified service and support providers complements the services directly

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available from JD Edwards to ensure timely implementation and ongoing quality of the solution.

11. Relationships with company, clients have a partner committed to ushering them through changes in business and technology. The company's product development, support and training are tuned to meet your current and evolving needs. By understanding the customers' industry, paying attention to business fundamentals and ensuring customer participation in the development process, JD Edwards work to protect the customer's investment with solutions that evolve with their business.

Future Directions in ERPThe only constant is change. No more so than in the constantly evolving, high-speed world of technical innovation.

Therefore, the question is: How will these inevitable changes affect the ERP market? In this chapter, we will survey the industry landscape and find out what is on the horizon—keeping in mind that often what appears to loom large in the distance, turns out to be a mirage. ERP industry watchers are agreed on at least one point: 'one-size-fits-all', across the board integration is no longer seen as the unwritten law. As revolutionary as the ERP concept was, and to a certain extent still is, given the number of companies yet to implement it, it is doubtful whether it can hold onto its overall position as the 'hottest' dominating technology in the face of competition from new cutting-edge technologies such as Internet commerce and EDI (Electronic Date Interchange), and competitive new business practices involving supply chain and customer self-service.

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Major ERP Vendors and their Products:Major ERP Vendors and their Products:

R/3R/3

Oracle ApplicationsOracle Applications

OneWorldOneWorld

PeopleSoftPeopleSoft

Baan IV________Baan IV________

SAP AGSAP AG

Oracle CorporationOracle Corporation

JD Edwards World JD Edwards World Solutions Co. Solutions Co.

PeopleSoft Inc. PeopleSoft Inc.

Baan Co.Baan Co.

Product Product V endorV endor

NEW MARKETS:As larger enterprises become saturated with new-generation client/serverERP systems, vendors are being forced to find new markets for their productsuites in order to grow. This pressure is causing ERP vendors to increase their appeal to small business clients through a number of initiatives.

These initiatives include the following:1. Supplementing their direct sales force with reseller channels

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2. Lowering the entry price point of their software to make it financially viable3. Stratifying their software offerings to appeal on the basis of reduced functionality4. Improving the implementation methodologies for faster deployment5. Porting the products to platforms such as Microsoft Windows NT.

NEW CHANNELSVendors such as SAP AG Inc., Oracle Corporation, and Baan Co. have been building reseller channels—both in the US and worldwide—to reach the smaller businesses that are looking for the complete-one-stop shopping for their ERP solutions.

The ERP software is made more financially attractive by lowering the entry price point for each module and by ramping up the total costs by basing price on user licenses.

Oracle is being particularly aggressive in this respect with software pricing comparing favourably with middle-market client/server offerings from companies such as Platinum Software and Great Plains Software.

Although JD Edwards ventured in these waters by complementing its OneWorld suite with a lower-cost line called Genesis, most of the vendors have avoided producing less-expensive 'lite' versions of their software. SAP abandoned its SAP Lite project some time ago and it looks as if the lite versions will have to wait for some more time.

FASTER IMPLEMENTATION METHODOLOGIES: All ERP vendors have suffered from the perception that their software is difficult and costly to implement. This perception has provided huge profits to the 'Big 6' accounting firms (now Big 5 with the merger of Price Waterhouse and Coppers SB Laybrand) that have generated billions in fees from their ERP software implementation 'practices.' Even though only 10-15% of the implementations have taken years to complete and have eaten up millions of dollars of consulting costs, the fact remains that implementing ERP packages is difficult.

An ERP system may consist of dozens of modules that are deployed on a multinational basis to service hundreds of users from many different business departments. There may also be a complete change of infrastructure—say from a mainframe to a UNIX platform—while a number of core business processes are being simultaneously reengineered.

ERP vendors have thus begun to focus their effort on making the implementation process easier by:

1. providing more effective tools 2. better methodologies to speed up the process, 3. creating elite consulting teams to intensify resources when required, and4. Using model-based approaches and opening up their systems for easier

integration.

For example, SAP has introduced a program called Accelerated SAP (ASAP) that takes the knowledge gained from thousands of R/3 implementations to date and consolidates this expertise in a product called the Business Engineer. This product helps implementation teams configure the SAP modules to conform to the processing style of some 100 business operating scenarios.

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Methodologies such as ASAP help reduce SAP implementation times to less than six months in many cases. Oracle recently introduced a similar program called Fast Forward, to help speed up implementations of Oracle Applications suites and nail down the costs up-front.

Business models and business application programming interfaces (BAPIs): SAP has attacked the notion that the R/3 system is not open by releasing the specifications for some 170 business application programming interfaces (BAPIs), which help third-party applications interact with R/3 directly.

BAPIs are simply, sets of methods that allow external applications to collaborate with specific R/3 business objects, such as customers, accounts, or employees. The fact that the R/3 data is addressable through these callable methods, (BAPIs) gives the third party application vendors a lot of flexibility to build supporting applications for the R/3 system.

In a similar manner, Baan provides an offering called OrgWare that is based on the use of a tightly integrated business-modeling tool, combined with business-specific templates that help to automatically configure the software to suit specific operational needs. Baan is currently in the process of enhancing this tool with new setup wizards to accelerate software implementation on the Windows NT platform.

APPLICATION PLATFORMSERP vendors already deliver comprehensive suites of application modules that support multinational deployment, Year 2000 compliance, and the Euro (European single currency). But each vendor is trying to extend the reach ofits software and make it more like an application platform than a suite of modules.

SAP is already ahead in this race; its R/3 product is one of the few that can be managed, centrally using popular platform management tools from vendors such as Computer Associates (UniCenter TNG) and Tivoh (TME),

NEW BUSINESS SEGMENTS:All the ERP vendors are now capable of delivering specialized variants of their applications to service vertical markets such as government, healthcare, financial service, or retail environments. Some vendors are also moving into more specialized areas, such as supply chain management and demand forecasting or sales automation and marketing. PeopleSoft bought Red Pepper Software to enhance its supply chain offering while Baan recently acquired Aurum Software for its Aurum Customer Enterprise suite of customer relationship management tools.

To strengthen its financial modules, Baan also teamed up with Hyperion Software to link Hyperion's financial accounting, budgeting and reporting solutions to Baans distribution and manufacturing modules.

MORE FEATURES... Improving decision support has been another focus of almost all the ERP vendors.

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Baan is linking its applications to the Gentia product (from Gentia Software Inc.) to provide OLAP capabilities, and for the setup and monitoring of key performance indicators. JD Edwards teamed up with Information Builders to deliver a data mart, based on Information Builders Inc.'s.SmartMart suite'of database access middleware, data transformation, reporting, and OLAP tools. Oracle provides a data mart designer and builder tool for creating data marts, and Oracle also offers Oracle Discoverer, an end-user tool for querying, charting and reporting data from Oracle's Applications suite.

The next version of PeopleSoft will include closer integration between PeopleSoft applications and both, the client-based Cognos Corp. PowerPlay multidimensional OLAP tool and Arbor Software Corp.'s multidimensional Essbase server. SAP has also previewed its own Business Information Ware-house product for synchronising the R/3 transaction system with a data warehouse that can manage both R/3 and non-R/3 data, through use of a metadata repository and a front-end OLAP engine.

WEB ENABLINGAs with every other software market, ERP vendors are being forced to move from a client/server to browser/server architecture to Web-enable their software and thus, deliver self-service and electronic commerce capabilities. Baan is working to deliver a Java-based Web interface to all its products. The company is also focusing on the automation of supply-chain relationships via the Internet, on e-commerce via the Microsoft Merchant Server (now known as Site Server), and on using Hyperion Software Corp.'s Spider-Man technology for report and alert distribution across the Web.

PeopleSoft is set to deliver its Universal Applications—Java-based self-service applets—with its PeopleSoft 7. JD Edwards is also using Java to allow its OneWorld functionality to be available either through a Windows client or a Web browser. While Oracle has used Java to deliver its Oracle Web Employees, Oracle Web Customers, and Oracle Web Suppliers modules.

In 1997, SAP released 25 Web applications for version 3.1 of the R/3 and recently previewed links to online catalogs for Web-based procurement. Unlike the Microsoft-centric middle market applications, the ERP vendors are all using Java, rather than Microsoft's ActiveX, for their first generation of Web-enabled applications.

The move by the ERP vendors to embrace Java as a means to deliver and deploy their Web functionality is the first move away from proprietary technologies to more open tools.

One reason why implementing solutions from SAP and PeopleSoft can be expensive is because the tools for customizing their products—ABAP4 and People-Tools—are proprietary. Whereas many lower-tier software vendors have built their application front ends using popular commercial tools—such as PowerBuilder, Visual Basic, or MicrosoftAccess—the ERP vendors have not taken this route.

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As a result, the customer will have to pay a premium for ABAP4 and PeopleTools programmers, instead of leveraging the PowerScript or Visual Basic expertise that they may already have in-house. Because Oracle is already a tool vendor, the company uses Oracle Forms, Developer 2000, and Designer 2000 to develop its Oracle Applications.

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