13 June 2008

Manufacturing ERP as a service springs from NetSuite

On-demand business management software developer NetSuite has taken the plunge into manufacturing ERP, with an integrated solution aimed at what it describes as light manufacturers.

Its NetSuite for Manufacturers is an extension of the company’s edition for wholesalers and distributors – launched in April 2006 – with functionality specifically for assembly, work order and BoM (bill of materials) management.

Bizarrely, the company feels that’s enough for it to claim that it’s taking aim at SAP’s core ERP market, “exploiting the prolonged delay of SAP’s Business ByDesign product roll-out, providing mid-sized manufacturers with an integrated on-demand solution they can put to work today”.

It’s hardly that, but its delivery of manufacturing-centric ERP using the software-as-a-service (SaaS) model could strike a chord, and demonstrates the company’s confidence in its ability to address more complex processes in industries dominated by the big, ERP players.

Nevertheless, Mini Peiris, NetSuite’s vice president of product marketing, says that NetSuite for Manufacturers now gives SAP customers and others an on-demand ERP option they can purchase and deploy without delay, where SAP, for one, is currently struggling.

What do you get? Well, NetSuite believes the key modules for manufacturing, over and above those already in its wholesale business system, are: assembly management, works orders, BoMs and demand-based inventory management.

Toby Davidson, business development manger, explains that its assembly management, for example, will enable manufacturers to more effectively manage component quantities and multi-level assemblies.

As for its work orders extension, he says that the system will allow light manufacturers to manage the build process for production work orders to replenish inventory levels of finished goods, while also supporting special orders built to configuration specified by a particular customer.

On the BoM side, it appears to be the usual stuff: “It’s like an extended MRP-lite aimed at component level assembly,” says Davidson. And he also talks of real-time scheduling for stock replenishment, with analysis available to deal with trends and seasonal variations.

Manufacturing users to date include Schaeffer Oil, GLI Pool Products, Satcom Resources and Littlearth.

“At the moment we are entering this market space,” says Davidson. “We’ve done a lot of research… This system enables manufacturers to get all the information they need in one place, gaining, for example, visibility over forecast and demand, as well as production, and taking advantage of pre-built e-commerce, configurators and EDI systems.”

And he adds that, since NetSuite’s delivery model is SaaS and all functionality and data is within one system, the total-cost-of-ownership is greatly reduced. “Cost is £600 for the system, with a per user price of £60 per user per month,” he says.

Says Peiris: “NetSuite enables manufacturers to automate complex business processes without the cost and complexity of cobbling together multiple business applications, and numerous spreadsheets. As a result, customers can stop wasting precious resources and start focusing on increasing customer service levels, cutting costs, and growing their businesses.”

Brian Tinham

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