What exactly is a suite?
It's a question for which even suite software providers have a difficult time formulating one answer. One thing they could all agree on, however, was that a suite is a set of solutions, or one all-inclusive solution, that stretches across business processes with seamless integration.
"The concept of a suite is really built around the idea that when a customer buys a solution, he buys as comprehensive a solution as he can," said John Geffel, senior vice president of product management for the mid-market division at Sage Software. "SMBs can't do exhaustive analysis into what [software] needs to be configured and what sort of technology resources they need to make it all work together. It becomes overwhelming. They are looking for the solutions with the breadth and depth they need for their business from day one."
For small and midsized businesses, there are few true major in-house end-to-end developers and providers of suites. But many software providers are working toward producing a version of the all-inclusive package that SMBs are demanding - even from some unlikely providers.
Michael Speyer and Liz Herbert from Forrester Research, an independent technology and market research company in Cambridge, Mass., co-authored the paper "Software and Services in the SMB Market" in July, and asked 798 technology decision-makers a host of technology-purchasing questions.
They found that 33 percent of smaller SMBs - companies with between six and 499 employees - prefer buying pre-integrated suites from one vendor, as opposed to a best-of-breed application or a bundle of applications that work together but do not span the entire business management needs of a company.
The Forrester researchers also found that 31 percent of midsized SMBs - those with between 100 and 500 employees - predominantly chose best-of-breed software applications and then integrated the products themselves. However, 29 percent of the same group preferred pre-integrated suites from one vendor.
Suite generis
No two suite packages are alike.
From NetSuite's all-inclusive package, which includes a customer relationship management application, an accounting system and e-commerce functionalities, to SAP Business One, which contains a business management or back-office platform, and embedded customer relationship management and manufacturing features, the short list of suite offerings vary greatly in terms of price, size of company that they can handle, and the functionality included.
One company that many would probably not consider a suite provider, yet which labels itself as such, is Microsoft Business Solutions. Though it offers four different enterprise resource planning systems - Great Plains, Axapta, Solomon and Navision - it considers each of its ERP products as a suite.
"We are totally strong believers in suites," said Christian Pedersen, MBS senior director of next-generation product management. "In fact, I would say we are not doing best-of-breed today. We have a number of product lines and each, in fact, are suites to a large extent. You could claim we don't have a full suite because of the separate CRM product, but the best-in-breed approach is being more and more alleviated."
The concept of one MBS application suite, however, known as Project Green, has been modified for the time being. Previously, MBS had announced Green as combining all three of its ERP products into one. However, Pedersen said, the concept has changed now to keeping separate the trio of ERPs, but ensuring that they all have the same technologies. "We are already delivering on Green," he added. "The Great Plains releases 8.5 and 9.0 versions are really guided by the Green effort and common themes."
Pedersen went on to say that Green, as it is currently mapped out, is set up in two waves. The first wave has four elements: a common user experience that ties into Office and Outlook, SharePoint portal conformity, business intelligence functions available on the SQL server, and Web Services enablement so that independent software vendors can build verticals that will span all the way across MBS's ERP product lines.
Wave Two will be much more linked with Office Version 12, Visual Studio .Net and with Longhorn - Microsoft's project to build a new common user interface - security, inter-operability and other application functions, said Pedersen. The flow of data will also be strongly tied to another project dubbed Indigo, the XML standard for MBS products using Web Services.
Today's suite providers are not worried about the MBS competition, however; in fact, they are eagerly awaiting the arrival of Green into the market-projected for 2008.
"If it comes about, and it's a big if," said Dan Kraus, vice president for SAP Business One, "customers will have to really look at what there is to choose from - new applications or legacy products."
Sage's Geffel claims that Microsoft is finally following the suite-concept model that they have been working on for years.
Tax and financial software provider CCH Inc. is also working towards providing software suites, not only for accountants, but for its corporate customers as well.
Ernest Zoumot, director of software product management at the Riverwoods, Ill.-based company, said that CCH is building and integrating a suite of applications, but without payroll and ERP applications.
"It's a natural extension of us," said Zoumot. "We have some of the most knowledgeable editors and developers in accounting and tax. A corporate suite provides us a channel to help corporations work directly with their accountant."
A QuickBooks world?
But research from the Forrester report still shows QuickBooks as the leader in the SMB market. For companies with between 100 and 499 employees, QuickBooks products hold 42 percent of the market share and 67 percent of the smaller SMB market share.
"The decision to try to change your financial management system isn't an easy one," said Laurel Lee, group product manager for QuickBooks, "It's hard to change all your behavior at once. Most of our customers just want to cut hair and be good at it, not overhaul their whole system."
Brian Watt, chief operating and chief financial officer at GECC Inc., a consumer-based lending institution in Newark, Del., with 20 employees, was using NetSuite at his previous position at a retailer before switching to GECC three-and-a-half years ago. When he started at GECC, the company was looking to move to an online accounting software system.
Watt picked QuickBooks Online this time. "QuickBooks, in my view, is much easier to navigate, the help files are stronger, and I think the product itself seems to be more focused on core accounting," said Watt. "I tended to find NetSuite overreached with regards to additional modules."
However, on the other side of the coin, Chris Hills, chief executive officer of D3Data - a security video management software provider based in Seattle - wandered between NetSuite and QuickBooks for many years before finally settling on NetSuite. "You open one system and you see everything," said Hills. "A lot of accountants would dictate to me what I should be using [QuickBooks]. Now, I dictate to them what I will be using. That's a big change in the market, to be able to dictate what the accountant is going to use, rather than the accounting firm dictating what a customer is going to use."
Intacct's model follows a different path than NetSuite or SAP, which both have in-house developers for their modules. Instead, Intacct partners with best-of-breed providers like SalesForce.com and integrates their products in-house with Intacct's core accounting system for a best-of-breed type of suite.
"If you believe in freedom of choice for customers and accounting partners, there are many different applications that customers want to integrate or create to connect to the ERP," said Bob Jurkowski, chief executive of the on-demand suite provider, based in San Jose, Calif. "Customers really want best-of-breed out of the box; they want companies like us to simplify their processes."
