Baan reaffirms expanded support for manufacturing IT globally

End-to-end software for supply chain management (SCM), more for product lifecycle management (PLM), improvements in integration with iBaan OpenWorld and an expanded and redirected global services organisation, were key launches and previews at mid-market manufacturing enterprise software developer Baan’s InForum user and partner conference in Rome today – its first for two years. For a company with its entire heritage in extended ERP systems for manufacturing, the only surprise was no new ERP release. Instead, Baan and parent Invesys were honest – brutally honest at times – about their collective past failures and present difficulties, before moving on to a bullish assessment of their recent refocus on customers and then revealing their vision of newish direction, very broad systems, services and strategies apparently designed to serve customers better. In asides, the company also boasted some huge successes in the offing with its new functionality against PLM and CRM big boys PTC and Siebel respectively – observing wryly that this is where the growth is today, not so much in ERP. With its experience and user base in manufacturing ERP, if just half of what it said comes true, Baan and Invensys should prosper as users get much more rounded, high tech systems that build on what they already have while solving today’s growing issues. iBaan for SCM, for example (as described at least, although it was vague on detail), sounds extremely inclusive. It takes as its remit everything from improving throughput and inventory utilisation, to ramping up supplier relationships and performance and managing logistics, with event management, pervasive visibility and so forth. It’s so broad that Baan says it’s creating a dedicated business unit specifically to look after it, building on its Caps Logistics past. First up will be iBaan Collaborative Despatch (event management and logistics management), although the firm is already claiming successes considerably beyond that, notably with cigarette manufacturers House of Prince and aluminium producer Alcan Cable. Part of the ‘secret’ is that much of this now launched ‘suite’ has been developed in collaboration with Baan’s customers so most will be approaching release after validation. In fact, all of iBaan for SCM and the forthcoming iBaan for PLM (which follow January’s iBaan for CRM launch), as well as the iBaan OpenWorld 3.0 release – and a new ‘out of the box’ plug-and-play SAP-to-Baan integrator (unthinkable 12 months ago) – have been developed following consultation with its customers. Baan president Laurens van der Tang, made no bones about the importance of Baan listening to its customers and rebuilding relationships. Which is good and welcome news. Hence also Baan’s industry-specific solutions so far: first for logistics and transportation organisations (iBaan for Logistics, developed with Exel and released six months ago), followed by iBaan for Automotive (for the OEMs, built with Dana). Most recent have been iBaan for Electronics (for high tech manufacturers, with Flextronics) and the iBaan for Industrial Machinery and Equipment suite, released at Cebit, Hanover last month. Senior vice president of marketing and alliances at Baan, Henk de Reuter, indicated that these are not merely new products – indeed much of each of the suite is definitively not new. They are, however, specifically “solutions amied at improving operational excellence” for each of the sectors. Ignoring the unfortunately obvious implication that its former systems were not, his point is clear: that achieving this in disparate industries requires different combinations of underpinning IT to support different levels of engineering collaboration, manufacturing engineering, procurement, production planning, supplier relationship management, logistics management and the rest. What Baan, like so many of its competitors, is trying to do, is build a logical matrix – of functional solution suites and customer-led, industry-specific collections of those with appropriate templates and methodologies built in. Ernie Eichenbuam, Baan’s vice president of marketing, says more will follow as the company sorts out what level of granularity makes most sense. It all sounds good: good for Baan and good for users. The question is what’s the difference between the ‘new’ Baan and its apparently equally new competitors in the big boys extended enterprise software league? And it’s perhaps telling that Eichenbuam’s best answer was “we’re not just talking about this stuff, or asking customers to trust us, we’re saying ‘come and see what we can do’.” Not quite the stuff that’s going to rouse the sleeping giant though. There is a little more. Recognising industry’s reluctance to get involved in lengthy implementations again, and its demand for short term return on investment (ROI), Baan is also building on its experience to offer templated delivery of elements of its solutions in defined time frames at fixed cost. For those wanting pilots followed by iterative project development, this is clearly a good way to go – assuming there’s a strategy for change in there somewhere. Just as important, Baan’s own global consulting organisation, charged with “changing the balance of the amount we service direct from the current 15-20%,” according to Eichenbuam, will be attractive to some. Already Baan sports some 400 in the group dedicated to services across the board, built over the last 12 months from it efforts within the now defunct Invensys Software Systems division. Baan people were quite open. The deal is not just implementations done by Baan, rather than only its global and regional/industry reseller and implementer community (IBM Global Services, the Big Six, etc), but a deliberate move to foster “longer term, strategic partnerships” with big and evolving manufacturing customers. The offer will be everything from application customisation, to business process change and integration, as well as enhanced maintenance and support, ultimately with the option of application management and hosting. There may yet be a shakeout here. Baan says it expects “significant growth” from this development. Whether it will be at the expense of Baan’s competition or some of its alliance VARs is a moot point. Worried partners were apparently wooed with the offer of more proactive Baan involvement in lead generation as well as assistance with marketing and communications if they ramped up their own game. Meanwhile, rumours at InForum around Baan’s relationship with IBM for the future, if true, may well mean substantially more growth for the company in terms of license revenues, driven by IBM globally, and a welcome resurgence of Baan in heartland manufacturing. As for owner Invensys’ new CEO Rick Haythornthwaite reaffirmed the company’s commitment to Baan as a key component of its newly formed Production Management Division set to turn the organisation around. Refreshingly candid, Haythornthwaite spoke of the transformation he is currently steering his company through, since joining just six months ago. His avowed goal is to pull it kicking and screaming out of its current £3 billion debt, and to consolidate what he described as its 1,000 fairly disconnected operating centres covering 80 countries and employing 76,000, “with 120 ERP systems most of which didn’t speak to each other!” He conceded that, Baan’s achievements notwithstanding, he has a long way still to go – with £1.4 billion of refinancing to achieve before August. However, for the benefit of press, analysts, alliance partners and users alike, he fairly exuded urbane confidence that the disposals, banks and bond markets would achieve all that is required. The strategy articulated from the top is partly one of selling its apparently less aligned companies (like FlowControl, another moot point), and critically, bringing together the parts of the organisation that Haythornthwaite believes will deliver compelling formulae for its market sectors. Key to this is the formation of three new divisions, Production Management, Energy Management and Development, the latter covering aspects like transportation and wind turbine engineering. In manufacturing it means Invensys bringing together even more closely its Wonderware, Baan, Triconex, Eurotherm, Foxboro and APV brands, technologies and people. The goal is the classic one stop shop covering everything from manufacturing- and specific industry-centric extended enterprise level software all the way through manufacturing execution systems, to plant and shop floor production monitoring and control.