Having missed out on the action in the Indian enterprise software space, thanks to the lack of a clear strategy, J D Edwards is all set to make up for lost time with a new strategy that could change the rules of the game in the enterprise space. Srikanth R P reports

Neil Dibb says that JD Edwards’ architecture makes it possible for it to break the product into different components and integrate it seamlessly with other enterprise solutions

Till some time ago a vendor used to be identified by the type of solution he offered. A specialised player in each space meant that a customer preferred to buy an ERP solution from a SAP, a CRM solution from a Siebel, or a SCM solution from an i2. But as margins thinned out in each space, every vendor started looking at other untapped areas which would serve as natural extensions to their own specialised solution offering. For example, an ERP vendor would start offering solutions such as CRM or SCM in addition to its own ERP solutions. The new terminology has been extended to even pure-play database vendors who are now offering a suite of specialised enterprise applications. Just like the global scenario, the Indian market scenario too represents a clutter of vendors—each offering a host of enterprise applications.

But among all this action, J D Edwards was the one vendor with a wait-and-watch attitude. It had no direct presence in India and was only represented in the country by Systime Computer Systems, a CMS group company. But as the market dynamics changed and a host of Indian organisations rapidly adopted enterprise applications, J D Edwards saw the need for a more focused approach. Before formulating a strategy for the Indian market, J D Edwards looked at its global strengths and key reasons on why its customers preferred it to other vendors.

A survey carried out by consulting firm McKinsey showed that most customers who opted for J D Edwards’ solutions were risk-averse customers. Most of its customers were budget conscious organisations, who needed a solution that was not only flexible, but also faster to implement. The Indian scenario was not too different from the global one and J D Edwards knew that to make a mark in a market dominated by vendors like SAP, it needed to create a unique proposition.

So while other vendors started pushing their entire range of end-to-end service offerings, J D Edwards’ concentrated on offering the customer a component-based approach. This effectively meant that customers could break and choose parts of a specific enterprise solution and buy only what they needed for their organisations.

Explains Neil Dibb, director for business development for the Indian Subcontinent, “The traditional approach where organisations have to wait for months for justifying the return on investment (RoI) on the purchase of an enterprise application is no more acceptable in the industry. Hence, in current times when CIOs have to justify the RoI for every enterprise application they purchase—a component-based approach is best suited as the risks are lower. As organisations can pick and choose parts of a module, the initial cost is lower. Also, the time taken to go live is greatly reduced, resulting in faster RoI. Additionally, our component-based architecture eliminates the need for proprietary solutions, allowing customers to easily scale up their operations rapidly.”

This strategy has also attracted SMEs, which were earlier reluctant to invest in an enterprise solution because of the huge costs involved. In addition, recent analyst reports suggest that though awareness and level of adoption of enterprise solutions like ERP is high in large organisations, it will be the SME segment which will drive growth. J D Edwards’ strategy seems to have paid off as in a period of around eight months, the company has increased its customer base to 55 from an installed base of 43. This increase is a significant achievement as the company had managed a customer base of only 43 customers since 1994.

To increase market share in the enterprise applications space, J D Edwards is also looking at the non-ERP space. For instance, most organisations today are divided over the options of going in for a complete enterprise application package consisting solutions such as ERP, SCM and CRM, or whether they should go in for best-of-breed solutions with different packages from different vendors. Both sides have their own advantages.

For example, an ERP solution like SAP may have some modules that don’t fulfil the needs of the customer. Over here, a best-of-breed solutions approach may work, where an organisation chooses different modules for its different needs. But in such cases, there may be problems too—as the time and money spent in integrating different modules may be much more as compared to a customer opting for a complete package. J D Edwards hopes to combine the best of both worlds by its component-based architecture, which solves the problem of integration.

With solution offerings spanning from ERP, CRM, SCM, SRM to Business Intelligence, the company has the capability to target ERP bases of established vendors. While in India this strategy is still at a nascent stage—globally, this move is paying off. For instance, most of J D Edwards’ SCM customers are SAP reference customers.

Adds Dibb, “Our architecture makes it possible for us to offer a component-based approach and effectively complement any enterprise solution. We also keep the architecture in mind while going in for any new acquisitions. For example, around a year back we acquired YOUCentric to strengthen our CRM functionality. As the architecture was not product-centric, we could break the product into components and integrate it seamlessly with our other enterprise solutions.”

This architecture is the company’s strength as complete modules can be changed quickly as per the needs of a customer. Going forward, Debb believes this will be the core difference between J D Edwards and other players.

Now, in addition to having a direct presence in the country, J D Edwards is also sprucing up its list of implementation partners. Apart from Systime and Accel ICIM, the company has also recently roped in L&T Infotech as its implementation partner. That J D Edwards is serious about its Indian operations is evident from the fact that it has already earmarked an investment of $10 million over the next couple of years. Having implemented the first stage of the roadmap—by forming a local sales office—the company is now looking at taking advantage of India’s strengths in software. Though there have not been any concrete plans, the company is actively looking at possibilities of outsourcing software development work related to product development and application testing.

Most of these projects would be done through the joint venture route and the company is in talks with a couple of Indian software companies for finalising these plans.

Conclusion
With a strategy that is paying dividends in the current scenario, J D Edwards seems to be on track to achieve its short-term target of upping market share from the current 4-5 percent to 7-8 percent in the next one year.

Though competition in the market is tough with established vendors like SAP lording over the market with close to 55 percent market share, J D Edwards with its new found aggression and component-based approach could spring a few surprises.