Although Frontstep has got rid of a big part of its burden by delivering the SyteLine 7 (PART 1) offering on the single platform, the major task of translating it into its users genuine needs (and consequently a demand for its products) only now has to start in earnest. Frontstep's focus shift to value chain management matches the shift in e-commerce focus from indirect materials procurement to areas such as strategic sourcing, channel management, and supplier enablement. Given its customers are mid-size manufacturers, by also enabling them to streamline the entire manufacturing functional processes (e.g., planning, order management, scheduling, etc.), Frontstep is aiming at rendering its customers indispensable to their customers.
Therefore, while Frontstep seems to have positioned itself well as it already possesses most of the required components, it needs to try to more clearly articulate the message that the true collaboration can only be achieved if the core product is an ERP system which by its very nature enables intrinsic collaboration (which .NET and Web service should supposedly provide), rather than a product which has to have modules added on to achieve the collaboration. To that end, Frontstep's message will have been diluted by a spate of other vendors announcing their .NET allegiances and delivering pieces of their offering (often without mentioning it should happen only some time in the future). The fact that Frontstep is already there might often be missed by less-discerning and informed users, who may get Frontstep's message as a �me too' statement.
The company needs to promulgate its plain English worded strategy of helping its manufacturing customers and their business partners automate and streamline business processes inside and outside the four walls of the enterprise, such as on-line collaboration with customers, suppliers, distributors, and employees, to make everyone's internal operations more efficient. In a market with stringent IT budgets, Frontstep has to demonstrate how its CRM, ERP, and SCM products deliver actual savings.
Enterprises have to see the value of tying their supply chain functionality to their marketing, sales, and service operations, and the point of gathering enough information about what customers need so that actual physical supply chains can evolve into informational demand chains. Moreover, Frontstep has to create stronger awareness of its applications with an architecture that allows smaller companies to support specific processes as needed and to see measurable results in less than 90 days. SyteLine 7, with its embedded flexible and adaptable BPM activity and user efficiency (via strong personalization, navigation and "rich" user interface (UI) available either on the desktop or in Internet Explorer but still resembling the UI from earlier versions), seems to offer answers in that regard.
Some of existing SyteLine customers' exodus should also be reckoned with (for, e.g., Progress loyalty or simply for reluctance to change), although Frontstep has taken many steps to protect their current technology investment. While existing customers will eventually have to migrate to the new SyteLine 7 environment (which means departure from Unix OS), they will be given several years to make that decision (within which period of time they will be supported as usual), and it should be a maintenance upgrade rather than a new system implementation, which should supposedly be much less steep and expensive. Time will only tell whether this approach will prove to be the right one. Although Microsoft sounds a better bet than Progress, some vendors like QAD have opted to continue a two-pronged product strategy (with simple object access protocol (SOAP) serving a role of a mediator between the applications developed in Java and Progress), rather than to face their customers' disconcert and potential erosion.
Frontstep's financial situation, particularly its scarce cash of only $3.4 million will also likely be cited by its financially stronger opponents as customers' deterrent. Still, despite impending product enhancements of secondary product lines, the broad scope and flexibility of its recently enhanced product offering, as well as the size of the existing customer base should provide Frontstep with recurring revenue and possibly ongoing profitability and positive cash flows during the looming mid-market carnage.
Therefore, while Frontstep seems to have positioned itself well as it already possesses most of the required components, it needs to try to more clearly articulate the message that the true collaboration can only be achieved if the core product is an ERP system which by its very nature enables intrinsic collaboration (which .NET and Web service should supposedly provide), rather than a product which has to have modules added on to achieve the collaboration. To that end, Frontstep's message will have been diluted by a spate of other vendors announcing their .NET allegiances and delivering pieces of their offering (often without mentioning it should happen only some time in the future). The fact that Frontstep is already there might often be missed by less-discerning and informed users, who may get Frontstep's message as a �me too' statement.
The company needs to promulgate its plain English worded strategy of helping its manufacturing customers and their business partners automate and streamline business processes inside and outside the four walls of the enterprise, such as on-line collaboration with customers, suppliers, distributors, and employees, to make everyone's internal operations more efficient. In a market with stringent IT budgets, Frontstep has to demonstrate how its CRM, ERP, and SCM products deliver actual savings.
Enterprises have to see the value of tying their supply chain functionality to their marketing, sales, and service operations, and the point of gathering enough information about what customers need so that actual physical supply chains can evolve into informational demand chains. Moreover, Frontstep has to create stronger awareness of its applications with an architecture that allows smaller companies to support specific processes as needed and to see measurable results in less than 90 days. SyteLine 7, with its embedded flexible and adaptable BPM activity and user efficiency (via strong personalization, navigation and "rich" user interface (UI) available either on the desktop or in Internet Explorer but still resembling the UI from earlier versions), seems to offer answers in that regard.
Some of existing SyteLine customers' exodus should also be reckoned with (for, e.g., Progress loyalty or simply for reluctance to change), although Frontstep has taken many steps to protect their current technology investment. While existing customers will eventually have to migrate to the new SyteLine 7 environment (which means departure from Unix OS), they will be given several years to make that decision (within which period of time they will be supported as usual), and it should be a maintenance upgrade rather than a new system implementation, which should supposedly be much less steep and expensive. Time will only tell whether this approach will prove to be the right one. Although Microsoft sounds a better bet than Progress, some vendors like QAD have opted to continue a two-pronged product strategy (with simple object access protocol (SOAP) serving a role of a mediator between the applications developed in Java and Progress), rather than to face their customers' disconcert and potential erosion.
Frontstep's financial situation, particularly its scarce cash of only $3.4 million will also likely be cited by its financially stronger opponents as customers' deterrent. Still, despite impending product enhancements of secondary product lines, the broad scope and flexibility of its recently enhanced product offering, as well as the size of the existing customer base should provide Frontstep with recurring revenue and possibly ongoing profitability and positive cash flows during the looming mid-market carnage.
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