The Open Source Pragmatist

You have likely heard the names before, especially if you are an advocate or user of open source software.  Beginning about, 3 or 4 years ago open source software began to get noticed in the world of enterprise applications.  The clear leader and fore-runner in the enterprise was SugarCRM, now several other common or soon to be common names join SugarCRM as credible enterprise applications and ‘Bossie’ award winners.  SugarCRM, Compiere, Magento and Pentaho are all 2009 Bossie Award Winners.  The Bossie’s are awards bestowed upon the Best of Open Source Software.  These applications though different in their capabilities and purpose share three distinct similarities:

1) They are all Bossie award winners - best in class in their respective categories.

2) They all can be integrated and complement each other in a typical enterprise.

3) They all are partners with Levementum, an emerging leader in the open source community as a system integrator and implementer.

Levementum’s customers span small business requiring CRM (SugarCRM) and a web store (Magento) to the multi-billion dollar enterprise requiring ERP (Compiere), CRM (SugarCRM), e-Commerce (Magento) and Business Intelligence (Pentaho) all complementing each other.  Creating synergy between these applications is both the dream and nightmare of most CIO’s.  Levementum has made this their bread-and-butter and understand the importance of applications that are integrated and support a single verison of the truth in an enterprise of any size.

Congratulations to the 2009 Bossie Award Winners.

Industry, Software & Technology compiere, magento, open-source, pentaho, sugarcrm

As we trudge through the weak economy looking for ways to attract new clients and grow our business, the old Marketing 101 adage comes to mind:

“Your best new customers are the customers you already have”

At Levementum, we’re finding that this rings true in an amazing way.

With our SugarCRM, Compiere, and Magento Open Source service offerings, we’re finding that the hit rate (on new Open Source apps) for customers that previously have implemented one of these outstanding products, is well over 50%…an amazing rate of Opportunity conversion.

Why is that?  I think its a reflection of how these clients have crossed their own chasms relative to the key “Objections” raised in the course of a Commercial Open Source sale.

When we talk to a new customer - one that has never implemented an Open Source product at an enterprise level, the four concerns we tend to see are:

1. Concerns about the Project/Company viability.

2. Concerns about support and SLA.

3. Concerns about Intellectual Property rights of derivative works.

4. Concerns about quality and features.

Clearly these objections are colored in the spirit of Open Source as a “new” and “disruptive” force, and customers have to be carefully navigated through these discussions.

The key  is, once the bridge has been crossed with one application project, the propensity to steamroll through these objections on the following application project is very high.

We’re finding that SugarCRM customers love Compiere…Compiere customers love what SugarCRM has to offer, and we’re also seeing an interest in Magento from customers of both SugarCRM and Compiere.  Again I propose its because they’ve already taken the Open Source plunge - and already subscribe to the unparallelled value proposition that they can take advantage of:

1. Control of Your Own Destiny.

2. Cost Benefit and TCO.

3. The Quality factor (as a strength)

We’re hoping to continue to see more and more progress - its a bet Levementum has made in spades - and why we continue on our path to being at the forefront of service firms that help Enterprises make sense of how to deploy broad Open Source solutions as an enabler for their own value propositions.

We’re in exciting times in the world of Open Source…The strength of the community has been, well, the community!  I see the opportunity for the SugarCRMs, Compieres and Magentos of the world to cross pollinate - share customers - share ideas - define boundaries - maximize opportunity value.  Its a win win for everybody, mostly for our customers .

Insight & Thoughts, Software & Technology compiere, crm, ecommerce, erp, levementum, magento, open-source, pentaho, sugarcrm, talend, varien

Yesterday SugarCRM announced new pricing for it’s flagship products SugarCRM Professional and Enterprise, as well as simplified pricing and a brand new entry level product SugarCRM Express.    By eliminating price differences for on-demand and on-premise versions, while lowering the price to $360/user/year for PRO and $600/user/year for Enterprise, Sugar also signaled it’s strong desire to be the leading “Open Cloud” application provider.   The lower prices gives SugarCRM customers more value at a lower cost - just when they need it most - in the middle of the worst economy in 80 years.

The CRM Guru, Paul Greenberg agrees - check out his ZDNet blog from yesterday.

The changes also make great sense for SugarCRM as well as the general partner community for two reasons.

First is the release of Sugar Express, which allows Sugar, for the first time, to obtain a revenue stream for those who only need the functionality of the open source (Sugar CE) version, are not ready to pursue the higher Professional versions, but still want a reliable support program. They are basically taking on the non-sanctioned companies out there who aren’t in the partner program, who are hosting/selling CE hosting services and generating revenue without contributing to the community. This is a good thing to protect the brand - to many customers who think Sugar is a bad product because they choose a ‘fly by night’, non-sanctioned company who was hosting CE and not doing it very well.

Second, by standardizing on one price for each version (instead of a lower price for on-premise vs. on-demand) Sugar will actually increase it’s total revenue dramatically and get better leverage from their open cloud environment.  It’s no secret that the majority of Sugar implementations are on-premise. By standardizing the pricing, giving all customers an on-demand environment (while still allowing them to go on-premise if they like which is a KEY DIFFERENCE from other SaaS vendors) they will a) generate more net revenue by capturing more hosting service revenue b) ensure a better experience for customers and c) get better cost leverage out of their hosting environment.

Sugar is also working hard to enable the partners to more effectively implement and configure the Pro and Enterprise applications in their cloud environment with the Cloud Console (rebranded version of Data Center Edition).

Some partners with hosting services will complain that Sugar is taking hosting revenue away.   That may be true if all the parter was doing was loading Sugar on a box.   But there is clear room for value added hosting services in Private Clouds, especially where the customer wants to retain complete control at the root and database level or even better, host mutliple open source applications, connected together, in the cloud.   Levementum uses private clouds on Amazon EC2 to allow customers to manage BOTH Compiere and SugarCRM applications that are integrated as one solution.

Sugar is still on the track as the first Open Source business application to go IPO.   It’s fun to be along for the ride.

Insight & Thoughts cloud-computing, compiere, levementum, open-source, sugarcrm

Compiere Inc., an open source ERP and CRM provider, is growing and getting noticed by key decision makers in the market for ERP applications.  Compiere is the pioneer of open source ERP and is the emerging leader in this application category.  Compiere recently received the award “2008 InfoWorld Bossie Award - Best of Open Source Enterprise Applications“.  As an open source business application, Compiere is an alternative to the traditional proprietary ERP applications like SAP, Oracle and Microsoft Dynamics.

I have recently evaluated and reviewed Compiere and wanted to outline some of my findings.  I have limited this evaluation of Compiere to some key areas.  For a more exhaustive outline of capabilities and features I would suggest visiting the Compiere website.

Compiere’s solution capabilities span Enterprise Resource Planning (ERP) and Customer Relationship Management (CRM).  These include the following capabilities:

• Financial Management (Accounting)
• Sales Order Management
• Materials Management (Purchasing)
• Warehouse Management
• Customer Service (Support & Self-Service)

Role-Based User Interfaces

One of the things I liked most about Compiere is its flexibility to adapt to an organization and to the roles within an organization.  Through years of observation, I have found that 80% of ERP users, use about 20% of the features and functionality that are available to them.  Dealing with the confusion this creates has always been a challenge when implementing some of the traditional ERP solutions.  In Compiere, the ability to tailor a user’s online experience in terms of ‘look and feel’ is defined easily using roles.  Roles are easily setup by an administrator, no development is required.  The menus, windows, forms and fields that are available to the user are all determined by the user’s assigned role.  When roles are established, they are specific to a group of user’s tasks and responsibilities ensuring that the users only see what is required to do their job.  Despite a broad array of features and functionality Compiere makes it easy to provide a simple streamlined user interface to your users.  This easily translates into reduced training and support costs.  Amongst complex applications, I have not seen an easier way to do this - Compiere hit this one out of the park.

Adaptability

Compiere employs an innovative model-driven architecture that gives you unprecedented adaptability, speed of deployment and a lower cost of ownership.  I personally think that Compiere is under-selling this particular capability.  The Compiere ‘Application Dictionary’ is a library of business logic meta-data that can be updated or extended to allow an organization to adapt Compiere to fit the unique requirements of their business.  The level and extent of the customization that can be accomplished using the ‘Application Dictionary’ would require significant development time and effort in any other application.  Compiere allows this adaptability while maintaining easy upgradability.  The time and expense this saves during initial implementation as well as during periodic upgrades contributes to the already lower cost of ownership when compared to traditional ERP solutions.

Warehouse Management

Recently released in Compiere 3.2, Compiere offers one of their best modules to date - WMS (Warehouse Management System).  WMS expands an already solid Materials Management module with a broad range of brand new functionality that automates inbound, warehousing and outbound operations.  This is ideal for organizations that are looking to cut costs, improve productivity, reduce warehouse space utilization or increase customer satisfaction.

At the center of the WMS module is a highly flexible and configurable rules engine for setting up intelligent materials movement through all phases of warehouse management operations.  This expansion of the Materials Management module is offered by Compiere for an additional fee per user or per warehouse.  If an organization only requires basic inventory and materials management functionality, I recommend using the functionality included in the Materials Management module at no additional cost - it is solid and mature.  However, for the mid-size to larger organizations in the distribution, retail or manufacturing industries where the warehouse operations are complex, there are numerous warehouses or the number of items and transactions are  high - the advanced functionality provided by WMS is worth the additional cost.  In situations where you may be looking to cut warehousing costs as it relates to warehouse moves and utilization - Compiere’s WMS solution is worth looking at as either an add-on to a larger Compiere implementation or as part of an integrated ERP solution.

Compiere has expanded their network of partners by about 40% in 2008 resulting in a growing ecosystem of knowledgeable and experienced system integrators ready to help with everything from Compiere support and hosting to Compiere implementation and integration.

Uncategorized compiere, erp, open-source, warehouse-management

Consider the scenario. You’re the CIO of a regional distribution company, supporting a “knowledge worker” environment of 200 users spread though 18 warehouses in 7 states. Your accounting team is demanding a flexible and scalable solution that lets them adapt in the face of changing economics and measures. Your warehouse teams are demanding more feature rich Order Management solutions that provide better information at the Point of Sale. Your Sales team is screaming for wireless access to orders and inventory, so they can respond to customer needs in real time…and of course your boss, the CEO, is demanding that you deliver all of the above, on a shoestring budget, and wants a working proof of concept that covers all these solutions - Accounting, Sales and Inventory/Order Management with Wireless…in 3 weeks…for less than 10k.

So you’re the CIO. What do you do? Laugh? Polish off the resume?

Well, if you’re Russell Smith, the CIO of Estes Industries, you take a deep breath – and look to Open Source. Estes Industries, based in Wichita Falls, TX, is a distributor of crop protection chemicals, specialty chemicals, seed and fertilizer. Smith turned to Levementum LLC, an open source consulting firm, to help complete this “Mission Impossible”.

Levementum brought three enterprise class solutions to bear, SugarCRM, Compiere ERP and Talend Data Integration to implement a complete ERP, CRM and Data Integration solution, in less than 3 weeks, and at an astoundingly low cost.

Levementum selected all three of these solutions, recognizing them as best of breed Open Source Software solutions. All three software packages have come of age relative to the tried and true(…but expensive) commercial closed source solutions in the marketplace.
Compiere, a robust Enterprise Resource Planning (ERP) solution was deployed to support accounting and operational needs. SugarCRM, the leading open source Customer Relationship Management (CRM) solution, was deployed to support the myriad of Sales Force Automation needs, as well to satisfy the need for Wireless access to Customers, Contacts, Orders and Inventory (using SugarWireless). Talend, a software product touted as the first provider of open source data integration software, was used to tie the systems together in a clean manner. Using add-ins and prebuilt adapters available in the Open Source community, Levementum was able to assemble, connect and deploy the solution quickly and cleanly.

The integrated pilot solution was built by Levementum using free “community editions” of all 3 software packages, but Estes intends to upgrade these to the Professional or Enterprise versions of the software packages, to take advantage of software support for these mission critical systems as they begin to roll the solution out in production.

Certainly there was a lot of excitement among Estes’ users – certainly a highlight of the project was demonstrating Order Tracking and Inventory management on an iPhone…but beneath the fun and excitement of accomplishing the critical functional goals of the program, there were a couple key takeaways, that are lessons for any CIO:

1. The Breadth of Open Source Solution offerings that are available to the public, are empowering companies to cover almost any information challenge they have. Whereas in the past all you had was Linux, today you have SugarCRM, Compiere, Talend and a host of other robust software packages that you have to choose from.
2. Open Source Solutions have “Come of Age” (like Compiere, SugarCRM and Talend). From a feature and architecture perspective, these applications have “grown up” and provide the depth of functionality, and the scalability that Medium and Large companies require.

The fact is, what cost hundreds of thousands or millions in the past, can now, with Open Source, be accomplished at a fraction of the cost. Open source solutions are the “great technology/value equalizer”. Luckily, over the past decade, these solutions have come of age – and as CIOs tackle their most challenging problems, Open Source tools are steadily proving to be far and away the most valuable tools in the arsenal.

Uncategorized compiere, crm, levementum, sugarcrm, talend, wireless