Netsuite’s pitch at being the core of business

The recent SuiteWorld conference put on in San Jose by Netsuite was notable for two announcements that are not only important to the company – obviously – but are also highly indicative of an important trend in the development of SaaS as a delivery vehicle.

The first of these is that the company is launching Netsuite for Manufacturing, moving it to what many business users would see as the very epicentre of their own operations and activities.

The second is the delivery of a new raft of service development tools that extend the Netsuite’s SuiteCloud platform on which users can build the services that they require.

Individually these are both important developments. But they can be taken together as a marker of a significant trend in the development of SaaS as a delivery vehicle – a move towards becoming core, mission critical capabilities for any business.

It is fair to say that, until now, the majority of SaaS applications  have been point solutions largely at the edge of the business spectrum. They can offer really useful services and capabilities but, in the final analysis, no company is like to collapse as an operational entity if that service is no longer available. It might not operate as efficiently or flexibly, but it won’t stop or implode.

This is, arguably, even the case with vendors such as SaaS `poster child’, Salesforce.com. There are those that see CRM as now being more important than ERP – which is Netsuite’s core balliwick. If the customers are there and aren’t buying, who needs enterprise resource planning anyway? This may sometimes be the case, especially where the number of potential and live customers is very large, the revenue per customer order reasonably low. But in many businesses interacting with customers can be done in other ways – and often is.

The interactive complexities of ERP – covering the interactions of costs and revenues, stock and supply chain, time and motion, customer ordering and billing and a host of other processes – lies at the heart of why most businesses exist, and why they succeed or fail. All but the smallest businesses are likely to need an ERP system these days, even if they don’t consider themselves to be in the `producing things’ business.

And it is the interactive nature of these core business processes that makes Netsuite and its Manufacturing Edition an important development. It also lays down an important market in the wider context of the potential capabilities of SaaS services in general.

The real key to the Manufacturing Edition of Netsuite is that it is built on the fundamental platform that underpins every specific variant of the core technology. So it becomes possible to link it with all the other Netsuite editions – from commercial and financial management, through ERP, inventory management, ecommerce management and, yes, CRM. And it can achieve this without too much in the way of specialist intervention, certainly for the smaller to mid-sized businesses.

This demonstrates a number of points, not least being that the integration capabilities of that underlying platform means that a SaaS service can now be the core of an end-to-end business management environment. Another important point is that this platform is not – and never has been – the sole playground of Netsuite. Other vendors can, and do, integrate their `point solutions’ into the mix.

In fact Netsuite CEO, Zach Nelson, told Cloud Services World that adding partnerships with other vendors is now one of his important goals for market development and penetration. “We can’t do it all,” he said, “ and why should we try developing everything that customers might need when others are already offering those products and services? Some vendors still don’t get the partnership idea, however. We tried to partner with Workday as its Human Capital Management tools would be a good complement to Netsuite, but they didn’t want to. But then again, our partner, Informatica, can provide an agent to plug into Workday and integrate it with Netsuite. ”

So there is now a growing list of services that integrate into the Netsuite platform. These include Box, for cloud storage, Ascentis, CloudPay, Dell Boomi, Insperity, Meta4, NOVAtime, SilkRoad, TransCard and TribeHR, for Human Capital Management.

One of particular relevance to the introduction of the Manufacturing Edition is the latest partner, announced at the conference, the doyen of Computer Aided Design systems, Autodesk. This is a particularly good example of how integration within a SaaS-based platform model can be exploited. It becomes possible, for example, for the components of an AutoCAD-designed product to be linked straight into the Manufacturing Edition to manage such elements as component sourcing and manufacturing costs, and into the ERP system for component stock management, order management and delivery logistics, while the e-commerce suite handles the commercial aspects of selling and manufacturing the product.

And much of this work could be conducted as a `what if’ exercise on a virtual product, before it ever reaches production, giving users a good feel for that product’s chances in real life.  

Being a SaaS-delivered system also means that `industrial strength’ ERP and manufacturing management capabilities is readily available for SMB community without recourse to expensive and often time consuming consultancy services. 

But while it used to be argued that SMB was the only market sector where SaaS providers like Netsuite would see real traction, the large enterprises are now becoming fair game.

The appearance of major European consultancy and services provider, Cap Gemini, as a Netsuite partner shows that such companies believe SaaS is now ready to play in the biggest leagues. It also shows that the large Systems Integrators are starting to realise that their marketplace is moving to a higher level of abstraction. Here they can exploit the services the growing range of partners can provide, with SuiteCloud providing the bulk of the integration `on the nod’.  

This is because SuiteCloud gives users the ability to customise the platform themselves, sometimes at the coding level with the SuiteApps development tools, but more often by combining the services of the existing 700 or so Netsuite partners.

To enhance the capabilities of both the partners and end users, Netsuite has also added a number of new tools to the SuiteWorld and SuiteApps portfolios, with seamless integration as the key goal. For example, it has introduced Version 2 of Netsuite for iPhone. This is currently available in beta and due to become widely available in a couple of months. It adds new functionality which makes it a proactive tool rather than just a passive observation tool.

It has also added virtual `stickees’ – the digital equivalent of the paper Post It note. These can be used to put either public or private notes on data such as customer files. There will now also be the ability to drag and drop files between different work areas, plus a worklist tool which can allow users to drill down in data when required.