xTuple, PostBooks 2.2 and the SMB ERP market

In light of last week's announcement that xTuple released version 2.2 of both its OpenMFG and PostBooks I thought it might be useful to take a look at some of the dynamics of open source within the Enterprise Resource Planning (ERP) marketplace, especially as it relates to the SMB. A conclusive standard bearer from the open source arena has yet to emerge for ERP, where only a handful of technologies (and vendors) have begun to differentiate themselves as viable players. Despite having caught the collective attention of SMBs, it is crucial that vendors in the open source ERP space continue fill out product capabilities without adding complexity. Meanwhile competing enterprise application providers have begun an assault on this long-tail of the market as a source of unmet demand and potential growth.

Challenges
SMBs with significantly less resources to invest in the implementation but with similar levels of business complexity as compared to larger companies have come to rely on ERP systems that are typically characterized by:

• Brittle customizations: Customizations driven by vertical industry needs often prove inextensible and difficult to upgrade, not to mention expensive.

• A lack of integration: Existing investments tend to remain isolated from ERP systems by barriers of proprietary API's, and non-existent interoperability standards across numerous points-of-integration.

• Limited flexibility: ERP systems without the support of modular architectures prove hard to align with changing best practices and business processes. The result...more expensive customizations.

• Expensive TCO: Costs associated with the maintenance and upgrades over a typical ERP systems lifetime (~10 years) often prove a great deal more expensive than the original cost(s) of acquisition.

Trends and Expectations
A measurement of the value-add for open source ERP offerings like PostBooks depends on how well they can meet the realities of SMBs. Success in this area will be found through adjusting to the trends of SMB ERP adoption. xTuple, Compiere and OpenBravo will continue to find the more notable levels of adoption on the long tail. Therefore, it is critical for these offerings to address:

• The user experience: Improved usability and better role based support better enables third party members of an ecosystem to more easily provide high quality support/training, freeing them to deliver more comprehensive solutions. The end-users benefit from the added self-sufficiency and productivity. Here, an open source community creates a forum for gathering valuable feedback about any needed user experience investments.

• Microsoft Office dependencies: To date, integration with the Microsoft Office suite is still a required consideration. Desktop applications and documents contain a great deal of overlap with enterprise business applications. Previous investments in Microsoft Excel, Outlook and Word (used for financials, time management/scheduling and as the basis of content exchange, respectively) loom large within the SMB sphere.

• Shorter implementation cycles: The typical SMB is in no position to swallow the protracted implementations of ERP deployments. Industry-specific (and general) needs must be considered and met through best practices and rapid deployment methodologies. System integrators must be empowered to deliver offerings without sacrificing deployment quality.

• The continued emergence of "solutioning": It sounds buzz-wordish yet increased focus on SMBs has brought about the emergence of an increasing number of industry-specific verticals, business processes and segments. Accordingly, entire software ecosystems are required to exhibit a higher level of range and narrowed understanding that focuses on the delivery of solutions as opposed to just software. Customers have begun to expect solutions which meet their business needs not just a product to be thrown at their problems.

Simultaneously, Software-as-a-Service (SaaS) is slowly changing entire elements of what is expected from the software delivery process. Through its subscription based pricing model, and as a change agent for the concept of configuration, deployment and maintenance of an ERP system, the notion of categorizing software licenses as an operational expense has become real. Plus, the SaaS dynamic is set to influence the way in which the open source value proposition will play out. Personally, I think we've only witnessed the embryonic stages of the impact that open source will have on this space. It will be interesting to observe how the open source model works for the vendors that utilize it as well as how it affects the competitive balance between them and the Oracle's/SAP's/Microsoft's or between the Intuit's/NetSuite's of the world.

Technorati Tags: ERP |  open source software | PostBooks 2.2 |  xTuple | SMB | OpenMFG | Software as a Service

Comments

[jgpqc tfnhowzsq]

uifc qxowdsjp segb amwiznhk vwgs njfhzyt ukeifyvc

[Graham (PC enclosure Man) Gallagher]

Excellent post, I wish some of the other posts and threads I saw was as interesting as yours. Without ERP our business would be dead in the water, years ago. Thanks for sharing.

[generic viagra]

I do a lot of work on Word that I continually revise as things change.
I am encountering a problem that I have never had before. After I
have sent a document to My Documents and I later retrieve it, make a
change or two, I can not return it to My Documents without changing
the title. I get a message that I already have such a file set-up and
must put in a different title. This is a nuisance as the document is
the same with just a slight revision. I want to keep the original
title and not have to continually change to a new title and i do not
wish to have a file for both the original (which I no longer need) and
the new revised document. For years I have been able to do this
without any problem. I feel quite sure that it is because I some how
have changed everything over to "Read Only" but I can not figure out
how to go back to not having that restriction.

[spread betting companies]

A lack of integration is not as big a problem anymore especially with the iPad. Apps link to apps which is great.

[buy jeans]

Yet the context of what Eclipse has accomplished shouldn't be limited to the amplitude of the open source universe, but can be viewed as a portrait of massively distributed software development done correctly.
Jeans Clothing Store Online
Buy Jeans Online

[arizona limos]

At last i found this version!

[Writing Custom Essays]

xtuple postbook article is very informative article,,,
Thanks for your research on academic knowledge.++++

[Professional Essay Writing]

You have raised some valid points. Great work, keep it up. I love returning back to this site and reading the quality content you always have on offer. ------

[wholesale bags]

If you're trying to decide which one is best for you, here are some questions to ask yourself.

[Replica Louis Vuitton]

Excellent post, I wish some of the other posts and threads I saw was as interesting as yours. Without ERP our business would be dead in the water, years ago. Thanks for sharing.

[Cheap mulberry bag replica]

I really like this write! I enjoy it so much! thanks for give me
a good reading moment! http://www.mulberry-bagsuk.com/

[Online Video Production Company]

Great post, You have raised some valid points...... carry on our work

[Russian brides profiles]

Personally, I think we've only witnessed the embryonic stages of the impact that open source will have on this space. It will be interesting to observe how the open source model works for the vendors that utilize it as well as how it affects the competitive balance between them and the Oracle's/SAP's/Microsoft's or between the Intuit's/NetSuite's of the world.

[Chloe Moretz]

Despite having caught the collective attention of SMBs, it is crucial that vendors in the open source ERP space continue fill out product capabilities without adding complexity. Meanwhile competing enterprise application providers have begun an assault on this long-tail of the market as a source of unmet demand and potential growth.

[Russian girls online tips]

I do a lot of work on Word that I continually revise as things change.
I am encountering a problem that I have never had before. After I
have sent a document to My Documents and I later retrieve it, make a
change or two, I can not return it to My Documents without changing
the title. I get a message that I already have such a file set-up and
must put in a different title.

[dating sites reviews]

I want to keep the original
title and not have to continually change to a new title and i do not
wish to have a file for both the original (which I no longer need) and
the new revised document. For years I have been able to do this
without any problem. I feel quite sure that it is because I some how
have changed everything over to "Read Only" but I can not figure out
how to go back to not having that restriction.