Announcer 1: This is the ERP Advisor.
Announcer 2: Today's episode, a no holds barred summary of Oracle NetSuite.
Juliette: Thank you for joining us for today's webinar, a no holds barred summary of Oracle and NetSuite. Shawn Windle is our speaker for today. Shawn is the founder and Managing Principal of ERP Advisors Group, based in Denver, CO. Shawn has over 20 years of experience in the enterprise software industry, helping hundreds of clients across many industries with selecting and implementing a wide variety of enterprise solutions. His podcast, The ERP Advisor, has dozens of episodes with thousands of downloads and is featured on prominent podcast platforms such as Apple and Spotify. On today’s call, Shawn will discuss Oracle’s NetSuite offering and provide key insights into our experiences working with this vendor. Hi Shawn, how are you?
Shawn: Good, Juliette, how are you?
Juliette: I'm well. Thanks so much for joining me today.
Shawn: Ah you bet, thanks as usual for having me and for your inquisitive questions.
Juliette: Yes, absolutely. So today we are covering Oracle/ NetSuite, the name is a little synonymous; almost like you can't say one without the other in some respects. Oracle has been around for decades and has been a pioneer in the ERP space for years, and after acquiring and adding NetSuite to its portfolio, NetSuite has become Oracle’s go-to mid-market ERP software solution. With that Shawn, can you talk to us a little bit about Oracle and NetSuite, and the relationship between the two?
Shawn: Yeah, it's almost the tale of two cities but that's a little too dramatic. I mean Oracle has billions and billions and billions of dollars as a public organization for many, many years. I think in our research we put together, Oracle was founded a few years after I was born, so we'll leave a little mystery on how old Oracle, and I are.
Juliette: Right, right, right.
Shawn: So, Oracle's been around for a long time and really focused and established around the relational database management systems. Being able to track information and store information. And I mean, it's pretty cool when we take so much of this stuff for granted today. We don't even think about it, right? You don't think about the electricity when you flip on your switch, but you know it's taken hundreds of years to get to that evolution and we're 50 years in with ERP, based a lot on the work Oracle, of course, the founder Larry Ellison, and the team did there.
So, when I think of Oracle, I feel this is a company that has really done the hard work, developed a whole new mindset around basically little minds, MINDS. You can think about it like how do you store information. Well, today we store information in mind. We already know all that, but how does a business do that? Well, they would put it on paper, and they have paper. Well, the mainframe systems came along, and then midrange systems came along, and Oracle really saw this opportunity to say “hey, let's get off cards where you have to write stuff, and put it into an actual database system,” and there's a lot more information that real database administrator experts can tell us about that. But it's important for our discussion today because you've got an organization that was built from the ground up, as well as around other infrastructure tools and that's Oracle; they've done that.
And of course, they wrote their own ERP called e-business suite many, many years ago and did very, very well with that globally. And of course, as some of us old guys know they purchased PeopleSoft years ago, as well as several other applications. So, you've got this organization that's all about enterprise software from the top level to the apps that companies, governments, and nonprofits are using to run their books, all the way down to the database layer. Then, like you said, several years ago--I think it was about 2016--Oracle bought NetSuite. Now along the same time as Oracle's building out here, Oracle had two very important people, a lot of people came out of Oracle who are doing a lot of stuff in the world that is really cool for ERP--I guess including me come to think of it, I didn't think about that. But I didn't make it Oracle’s acquisition, I got to PeopleSoft, and I didn't make it through. I was like, I'm out. It didn't work.
Juliette: Oh gosh.
Shawn: Yeah, there's a whole story there for another time. That one’s going to be paid content though *laughs*.
But you've got Oracle, it's developing, building, and buying these applications starting in the early 2000s, and then in 2016 picked up NetSuite. But before that time, we had a couple of really key people from Oracle go out and start their own organizations. One of them of course started Salesforce, Marc Benioff, and then another started NetSuite, Evan Goldberg. I think there was some early money as an investment that Oracle put into both organizations, and those investments definitely paid off, that's for sure. If you think about it Cloud Software is a cloud software solution or an app, and it is the best customer for all the Oracle database technologies and the infrastructure tools they support and provide.
Since you have tons of users going into these apps, millions of transactions happening every second there are tons and tons of computing and processing that are happening, so it makes total sense why Oracle was engaged even earlier with Salesforce and NetSuite, but especially purchasing NetSuite later was a big customer for Oracle. But that's not the only reason, Oracle really focuses on enterprise organizations, larger organizations, and to do the mid-size organization, and even small medium-sized businesses, that was what the NetSuite strategy was all about. So that's why Oracle bought NetSuite; I think it's been very successful for them and it's good for us too, frankly, because we know NetSuite's got pretty good backing, it's pretty obvious. So, that's been good, but then it was interesting in my career, after I left JD Edwards and then PeopleSoft, I worked for an accounting firm advising companies on technology, basically doing about the same thing. And I came across NetLedger, which was the original name of NetSuite and Evan, and the team built it out as an ASP, which meant it was basically QuickBooks in the cloud, that was the concept of what it was.
Shawn: So, are you still awake?
Juliette: I'm awake. I'm awake.
Shawn: Good, ok good, I'm making sure.
Juliette: On the edge of my seat.
Shawn: Well, good I love it, I'm so excited too, I know. So, then you have this NetLedger which is meant to be QuickBooks for ASP, which was what now has become cloud, subscription, multi-tenant software as a service blah, blah, blah back then we called it ASP, application service provider. But we did a couple of projects with NetSuite, with a systems integrator in Denver, and man, he was awesome. It was great because they gave more functionality than QuickBooks and it was in the cloud at ASP and good implementation people that really understood businesses and it gave an organization the next level up of functionality around financials. Then I think as Rebekah, who I always have to brag about, I love Rebekah. In her research and what we're seeing is in about 2002 was when NetLedger became NetSuite.
Juliette: Did it just evolve into NetSuite or was it purchased?
Shawn: It did, yeah. I also have to look back at that because, in my own experience, I thought it was later that it became NetSuite, but around this time, they started to get more market share, more R&D dollars, invest back in the product and they started building out things like inventory. Now we're out of financials and into inventory, so it's not about the ledger anymore, it's also about inventory. I actually think that's right. I think it’s right that NetLedger then NetSuite around that early 2000 times.
So, then we saw NetSuite continuing to get developed more and more and more and more and they made some key acquisitions along the way like Open Air. They bought Quick Arrow, which was a professional service automation solution we were working with, and then Open Air got bought by NetSuite, as well as many other acquisitions. There's a marketing tool, marketing automation solutions, and then they also bought partner solutions along the way to kind of build out the whole suite of solutions. So, you could offer not just the financials but the whole business.
NetSuite's solidly in that Tier 2 because, shoot, we've got clients all the way from nonprofits, service firms, manufacturers, distributors, lots of high-tech software companies, data centers, etc. we've got tons of clients that can run that product and are. This is because of its capability, it's a very verbose functionality it offers that, we'll talk more about that, but that's a little bit of background. And then like I said, the acquisition of NetSuite, it was so funny. I was on a call with a bunch of industry analysts, literally, and I said, “I don't know why Oracle hasn't bought NetSuite yet.” The Oracle track was to take the best of JD Edwards, PeopleSoft, and EBS, and fuse those together to create Fusion, which was going to be a brand-new ERP platform. Oracle cloud fusion is available today. I think it took a little bit longer than anybody expected, and it’s really geared toward a larger organization.
I kept looking at it like, “Oracle means this mid-sized; it was about the same time we were reporting on the mid-size enterprise needing better ERP solutions. And I literally was on that call, “I'm just surprised Oracle hasn't bought NetSuite,” boom, the next day it got announced. It's kind of cool, but I still think Acumatica is going to get bought by somebody, but that's another story for another time.
Anyway, the bottom line is NetSuite landed Oracle, and Oracle has done a good job of keeping them separated as a global business unit. They didn't necessarily integrate in development, and I'm sure there's been tons of integration in that that's occurred, but they've kept it as its own separate business. Which I think has actually been pretty good because there's a lot of innovation. I've always loved NetSuite and working with the people there, especially over the years because they've been very focused on making sure they meet clients' needs. Now they've gotten bigger, and Oracle does have a little bit of a reputation for being kind of hard. But the thing you have to understand about Oracle is they just want to make money. Not in some “oh, they just want to make money that's terrible!” No no no, it’s more like if you license 50 users--and in the old Oracle you could set up users above 50, like 75. Oracle would come in and do an audit “looks like you owe some money for the 25 additional users,” “oh that’s terrible, I don’t owe you any money.” “Alright, well that’s what the agreement says.”
I have seen some discipline and rigor put in on NetSuite over the years that wasn't there after the Oracle acquisition, which I think has done really good for them. Whew, that's like a whole 12-minute soliloquy on NetSuite.
Juliette: Well, this is a huge topic, and they're a big platform with a lot of different offerings. So, I think it's great you were able to narrow it down to even just that. So, thank you. Can you talk to us a little bit about what they sell and are there specific industries they tend to work better for than others?
Shawn: Yeah, it's evolved a lot actually. At one point we were working with some folks that ended up creating what they called Sweet Success. So, NetSuite did a really good job saying, “ok, how can we make every single implementation successful? How can we make sure our app, when it comes and is put in and installed for a client, that it has preconfigured logic to meet that industry’s needs? Or preconfigured dashboards, reports, analytics that meets a distributor’s needs over a services firm, over a manufacturer. So, they built these sweet success bundles that would include base functionality plus some industry-specific functionality which is pretty cool. I mean it's a great program frankly.
Shawn: In terms of specific industries, it's almost easier to say which are not industries because we actually just closed a lot of NetSuite deals here right at their fiscal year-end. I don't even remember, we had a retail/distributor, kind of a consumer product company that designs and then has its own warehouse and fulfills orders. There's eCommerce, they have a lot of different things going on. Then we had a non-profit, which was good. We also had a manufacturer, we had I don't remember who else we had it was so many. There were so many other things.
I'll go back and look at the list, but that's the thing with this particular product is, I feel if you look across the market and you know what are you not going to get fired for-- don't think I've ever, have I ever said that analogy? That's, again, how old I am because there used to be this saying in like the 80s or something, it didn’t start that early--it was “you never get fired for hiring IBM.”
Juliette: Oh, interesting.
Shawn: That's what it used to be.
Juliette: I've never heard that before.
Shawn: That's what it used to be. And the reality is NetSuite has become the standard in the mid-market ERP space. When we're working with private equity-backed companies, that was one of the companies that just closed, “oh yeah we like NetSuite,” or high-tech software companies, even recurring revenue companies that are complex like transaction-based stuff with data centers and stuff like that. You know they've got some bolt-ons and things that help in those areas, even projects. So, it's a good platform for a lot of different industries. It doesn't meet everybody’s needs frankly, but I mean it really is a good fit for a lot of businesses.
Juliette: Yes, what kind of partner ecosystem does NetSuite tend to have? Can you talk just a little bit about that?
Shawn: Yeah, and for everybody who's attending and those that are listening here and have put up with us through this vendor of ERP overview, I love it, you probably do too.
Juliette: It's been great.
Shawn: We could talk about it all the time, but I'm going to throw in a little bit more on this one. So the vendor ecosystem for NetSuite is very interesting. It's good because what I see is you have to remember Oracle is about maximizing shareholder profit, not at the expense of quality or treating customers well. If you didn't have quality or didn't treat your customers well, you would never be able to maximize your profit. So people think that that's all “well, they just want to make money.” Yeah, thank goodness because then they're going to do the right thing.
Juliette: You still have to perform right?
Shawn: Well, you have to perform, and if you don't everybody’s going to know it, and then they're not going to buy your stuff. Then shareholder profit goes down. You can tell I was an accountant in school. Maximize shareholder return. Anyway, the thing about the ecosystem is Oracle has one strategy with NetSuite, which is world domination *laughs*. I don't know if it's that. They probably could say that.
Juliette: That seems simple.
Shawn: “Larry!” *laughs* there you go. No, I know Sam Levy is thinking that *laughs*, but it's true that the product like I said is so malleable to different industries and different company sizes. So, you can get NetSuite in at a very, very early stage, now you have to remember it's still a complex ERP. I hate to say this but there's going to be some effort required on the client side to implement this thing. Don't think you're just going to spend say $10,000 and the implementation will be fine. You're going to have to put some work into it, you're going to have to define your chart of accounts, your Item Masters, your project structure, etc. All the normal things you have to do with an ERP anyway, but what I see, from a partner perspective and even just a channel strategy, is that Oracle is really trying to dominate all of them. So, Oracle sells direct to us; we have a great lady who's pitching NetSuite to us, and she's great.
Juliette: Oh yeah?
Shawn: Yeah, she sent a little tumbler thing the other day, and she's doing a really good job with it. We run QuickBooks Online, which is fine for us, I don't want to change. We have a group of people that are really smart and capable of selling to organizations that are under 10 million in revenue. And there's a lot of organizations, a lot. They're like blanketing that market. Then there are mid-size companies, and there's corporate, and then there's another team that sells to the bigger guys.
So, you've got sort of this direct sales effort that's really trying to just blanket the earth, basically, with “we want to sell NetSuite,” we know it'll work for your industry. Then you also have partners that sell the software too, and the partner strategy is different than NetSuite. They're not going to blanket the world, but they're like, “whoa, how do we differentiate? How do we make something different here so that we can offer something different in Oracle Direct?” What they're doing, which is smart, is building out vertical and sub-vertical expertise. So, they can go not just to a distributor but an electronics distributor and say “we've dealt with things you have to deal with.” Situations that most industries don't know, and the general salespeople might not know, but these companies are getting more and more specific into what they sell, which is great.
Shawn: Then you also have partners that just do implementation. They're like specialists in doing implementations, so you know they're working very closely with the NetSuite Direct team. But NetSuite Direct has NetSuite professional services also, so they can offer implementations as well. What you have to do to understand all this is go up a couple of levels and look from the highest and see that they want the world to use NetSuite. So, while there's this conflict almost between the channel and direct, if you set back and look down, it's not a conflict from their perspective. These groups push each other. They actually make each other perform better. For example, if you're single you can do so much, but then if you're a couple you can do much more in your life. So, you get these different strategies that I think Oracle has been a master of being able to cover more of the planet for ERP and I think they've done a really good job with that.
Juliette: Does a company decide what features they need? Or does NetSuite help a company decide what they need?
Shawn: NetSuite does. NetSuite really takes the time to understand, and I think they've done well with their Sweet Success and other programs to say, "here's your industry, here's our typical offering, here's how we can make it more specific to you.” But then again that's where a partner may come in who really has that micro-vertical focus for food and beverage, for chemical-based companies, for hazardous-based ingredients, and that. We've got experts out there that have specific experience. So overall it’s a good strategy. It's different and depending on where you are in the food chain, you might hate it. We've had to work through it for years, and we're finally at the point where we fully understand and know when to bring in which partner.
But it is something we say to our clients like, “look, you really need to know what your options are,” because here’s the thing, especially where you're sitting in Denver, you can throw a rock and hit somebody who knows NetSuite. And that is the case in most major North American cities, not just the US but also Canada, and even Latin America; we know great partners down there. All throughout Europe, there're great partners, even sort of in Africa and Asia. There’re really good partners in Australia that have taken this product and know the experience because that's the thing. You're not just buying software--gosh, how many times have we talked about this--but you are buying partners and there are a lot of partners doing stuff with NetSuite right now; you can't beat that.
Juliette: Right. Well, Shawn, what are some of NetSuite's most prominent features?
Shawn: I would say from a financials perspective, which is the core, where it started, they've done a really good job of providing that middle, upper capability that a larger organization is going to need around financial reporting. So that could be things like multi-entity reporting, multiple legal entities, no problem. That's easy and a lot of apps do that, but then there's a consolidation capability that has to come in. There are intercompany journal entries that have to be put together. There are eliminations and all that stuff. Then if we have multiple entities, like a lot of our clients do, some of those entities are in other countries. You can have a European-based company that has entities throughout the world. A lot of Swiss companies are like that, so they can handle multi-company currency translation, FX, and have done a really good job automating that.
Even doing the OCI and some other capabilities around calculating transaction differences between currencies, so that we know our gain and loss on currency translations. And ultimately when you're in that environment, you have to have different sets of books. Sometimes you could keep a set of books for your internal reporting. But then for each country, we have statutory reporting that's different, so we have multibook capability. That’s the thing about NetSuite I think has been really good over the years is that they keep going deeper into really core areas. Same thing with manufacturing, it used to be just whips and routings. You'd hear that everywhere, work in progress and routing capability were billing materials, but then they made a really good acquisition for advanced manufacturing and they're getting into more batch and recipes, and process and distribution. There are lots of complex pricing methodologies and capabilities, eCommerce capabilities that they’ve brought in. So it's good broad and it's good deep.
You can see why we like this product, Juliette because you get a customer that has fairly complex requirements, and if you look at the competition, especially the newer guys, they might not go deep enough yet. They'll get there, but not yet. We have other clients that need a little bit of customization, or they have a really complex ecosystem for integrations with other applications. NetSuite's really good in that area from a technology platform too. The thing about it, I'm thinking of a person right now, is that NetSuite is really really good at more complex implementations; but those are also the harder implementations.
Juliette: Right, right.
Shawn: The easier implementations might be a good way to build a business, but those easier implementations may be met with another product that doesn't go quite as deep. So, this is why you have to evaluate and think through different apps to figure out “how much complexity do we really need?”
Juliette: That's right.
Shawn: Don't get too much, but don't get too little if you're growing. If you're growing a lot, like we just saw this in a client where we're like “I still feel NetSuite's probably the right answer for them,” we had to work through that. But they're private equity backed 50 today going to 100 million going to 250, and then the plan is to go up to a billion, literally. And they're in a very, very hot area of the world for a very specific technology.
Juliette: Oh, wow.
Shawn: And they're going for that bigger jump. They want to go towards more of a Tier 1. I look at the company and I'm like, “man, there's not a lot of people here that are going to be around to implement this thing and do the client-side stuff. We'll help them on the client side, but you don't want four or five of my guys doing all this, that's too expensive.” The client has to take some responsibility here, and I'm not sure they're going to be able to do it. And that's another benefit of NetSuite is the deployment’s pretty light. Meaning you know you sign a contract and *voop* your instance just pops up the next day. It's like a mushroom “where'd that come from?” but you still have to configure it of course.
Shawn: The technology support for NetSuite is pretty reasonable. I mean, there might be some stories, and we'll probably hear them from people like, “oh my gosh, NetSuite was so complex.” But no, it's not. It's not, I can show you complex if you want to see it.
Shawn: So that's the kind of balance around that product and where it comes from.
Juliette: Yeah, well, you touched on this briefly, but how customizable is NetSuite if you need it to be? Through this vendor series, we've touched on other software platforms that are gigantic, and people tend to buy it and grow into it like with NetSuite. Do you just buy what you need at the time and then have add-ons and optimizations or what have you? How customizable and flexible is it?
Shawn: You know, it's on the upper end of flexibility and I would say it's more on the sane customization side versus the insane side. It's funny, I've been looking up a lot of words and I'm thinking about the Latin so sane versus insane would be like you want sanity. NetSuite does a really good job with that. We've had many clients all the way from mining companies to data centers to construction companies that maybe the product out-of-the-box isn't perfect for their industry. But the application is malleable, it can be configured, it can be customized to meet these needs, and the way NetSuite works as a multi-tenant software as a service solution, you're going to get the upgrade; that's going to happen. When that upgrade happens, you of course need the regression test to make sure that your customizations aren't going to get broken.
Shawn: NetSuite does a really good job at communicating “hey, this is here, we're going to set up a sandbox for you with your code, you go test it and then confirm when it's ready; but we are going to migrate you by this day, but we're going to give you plenty of time.” It's totally fine, but the customizations within the product and the tools you can use to customize, extend, configure, whatever you want to call it, are very, very flexible, so you can build out apps on NetSuite. You can do that on multiple products, but it's a lot easier on the NetSuite platform; I think Acumatica is probably another one too. The newer ERP platforms are a little bit more geared towards less code to configure or customize a specific solution to them. There're apps like Nextworld that are kind of the next level on that.
But I think NetSuite has a really nice, broad capability because it also has its suite script. There're actually four or five different kinds of tools. There's a workflow tool, suite flow, everything starts with suite; that's how PeopleSoft was. They had people stuff, people tools, etc. You have a nice platform on the NetSuite side too which is really, really good for a customer that's saying “I'm growing, and I don't know what's going to happen in the future, and I really don't want to get off this thing. I don't want to take the time to slow down my business to get off my ERP.” Well, that's often why we select NetSuite because of the flexibility and additional modules, especially around eCom, there's an HR solution, marketing, CRM comes baked into NetSuite; you kind of get that for free. Of course, you’ve got to pay for the users.
Shawn: You pay for it as a big bundle, and there's just more of the functionality there to use.
Juliette: It almost seems like NetSuite is the more approachable type of software platform if you're a business that’s not quite sure what you need, and it's maybe not as intimidating as one of these gigantic software platforms that we've talked about. Is that right?
Shawn: Yeah, absolutely true, there's no question about it. Now over time, this is a warning for anybody at NetSuite that's listening to the call, there are competitors coming online that are getting more market share, that are even more approachable, but, how deep do they go? I've been doing this for 25 years. My first project was developing in COBOL, it was actually a cool strategy project where I was part of this team that I had no like I should not have been there, but I was the PowerPoint guy, the accountant guy on it.
Juliette: Right, right.
Shawn: We were doing this whole strategy for this telecommunications company and how to rationalize all it, it was amazing. Then boom, I went and did COBOL programming *laughs*. But that was enterprise systems; all of it's been enterprise systems that I've worked in, and the reality is that this solution is approachable. It is, but it's not for everybody. If you have a relatively simple business, I mean if you look at QuickBooks, they have millions and millions of customers. Does every QuickBooks customers need to move to NetSuite? Not necessarily, but you look at my business, our business Juliette, we use QuickBooks, Mavenlink--which is now called Kantata, it got purchased.
Shawn: It’s kind of like “what's going to happen with that?” At least I know NetSuite has SRP, service resource planning, in it already. You can see how there's a little bit of risk when working with the little earth guys. There's just a little bit of risk. NetSuite certainly is very vocal that the majority of tech companies that have gone public in the last five years have been on NetSuite.
Juliette: Oh, interesting, I didn't know that.
Shawn: And that means a lot. A friend of ours, we did a project for him, and he sold his company and he said he had to pay a gazillion dollars to get his system audited. We helped him and he selected NetSuite and a software company down here in Florida. It means something when you're on NetSuite; it also means something when you're on QuickBooks.
Juliette: Uh-huh, right.
Shawn: There's a time and a place for this solution, for sure. Then again, you might get some innovative person that’s like, “hey, I want to get into this solution now, and then I'm going to grow with it.” I can see the benefit even for us because now we have all these best-of-breed tools we have to integrate; we have to figure out how we're going to get data back and forth. Erica is like “ah I’m trying to get the time entries from Mavenlink over to QuickBooks,” then we send those as an invoice, it works fine. Thank God.
Shawn: Oh my gosh. But it didn't before, and we had to work through that. Whereas if you're in one package and you have a suite of functionality you don't have to deal with those integration issues. Maybe you're getting bigger, and you have to have integrations, and therefore you pick up a platform that has that capability. What I'm trying to say is ultimately, if anybody stayed on the call this long, NetSuite is a really good product for the evolution of a business. If you want to get into it early, do it, fine.
Shawn: You're going to pay a little bit more, it's a little bit more complex than you wish it was--I guarantee it. That’s going to be true, but you suck it up you, get into the product--minimum viable product--you don't have to implement the whole thing, just get the basics setup right. Then you can grow with this product. Again, it's not like you buy this thing, stick it over on the shelf, and don’t think about it for 10 years. Don't do that, especially with the package like that. It's like buying, I can't even think of an analogy because you can add and add and add and add and add to it, but you also need resources that know what they're doing like good partners. I think the account management group at NetSuite's pretty good. I think they care about their customers; you can always call those guys and gals to say, “Hey, I'm thinking about really putting CRM in place. I know I have it, but I'm really going to go that way. What do I do?” There's a lot of help and support for that.
Juliette: So, Shawn, from your experience of working with our clients, can you talk to us about why you think NetSuite tends to win over their competitors?
Shawn: Yeah, for sure, it's a great question. I've talked a lot about it already, but we'll start at the bottom. If we have a client that's going to do complex integrations NetSuite’s really hard to beat because it's not just about the technology platform of NetSuite itself, it’s also about the partners that do the integrations; they have great partners. If you start at the bottom level, then you can scale it. We had a client that in the busy season around the holidays would do like 2,000,000 transactions a day, small eCom transactions that would go into NetSuite. The other benefit of NetSuite is that it can scale the technology platform, the performance, and the server like the actual physical engine that sits underneath NetSuite can actually scale up.
You have to pay more but you can do that. So, their technology platform is good. Then the feature functionality, like I said, is good for specific industries and can go down even deeper; we've seen that. And we have a client right now that's a construction business, and the construction world is very, very interesting because there are some really good construction legacy applications. Vendors that have been working on construction for a long time know the ins and outs of construction unequivocally, but the platforms need a little bit of refreshing. We have one especially, and I will not name names.
Juliette: No, no.
Shawn: No, no. Oh man, we basically rewrote their agreement to make it a cloud-based solution even though they had a cloud-based solution. Anyway, that's an industry that's deep in functionality with these apps, but our client is really text savvy, and their customers are really tech savvy. So, we're looking at it like “we're going to look at the legacy applications, but we also really have to look at a platform like NetSuite because it's a platform solution on the technology side.” Omnichannel is a big deal. You want to be able to interact with your customers in a million different ways. NetSuite has that kind of capability built in, whereas some of our other legacy apps, again not naming names, really don't. They've had to layer it on later and their fundamental paradigm that they built the app around just doesn't gel.
Shawn: I really look towards my job and the firm right now that I kind of vet out the vendors. The team puts together the shortlist and I'll say, “oh, this vendor, they're not doing this, or yes they're doing that, or this implementation part this or that, etc.,” I'm like, “ok this is whom we're going to go with for the selection.” In the NetSuite world, there are just a lot of good partners that you can go to. And even going to direct NetSuite their professional services team--we've done a ton of work with them over the years--they've got great teams that really know certain industries, especially their professional services people are really strong. There’s a lot of capability there as well, so those are some of the reasons that it's a no-brainer pricing is a little higher than some of the other guys out there, some of the newer competitors for sure.
When you're looking at automation, that's going to save you adding like five people into the future at $100,000 fully loaded, that's 500 grand. That's the cost you avoid by getting the software. Suck it up, it's going to be beneficial that way on top of the additional sales and everything else you can do. So, in that way, pricing isn't so extreme they’ll price themselves out of deals. I always say this to the NetSuite people, if you're talking to a client that focused on price, you're probably going to lose because there are a lot of other vendors that can come in at a much lower price than NetSuite. But do they have that technology platform and the integrations and the ability to scale? Do they have the feature functionality specific to the industry? They might have that, but as some manufacturers are becoming services firms, and some distributors are becoming manufacturers can these other guys change that on their platforms. Sometimes they can't.
Shawn: And then ultimately you also have to look at the partner channel too; those are some big differences.
Juliette: Right, yeah. Well, you started with, my last question is if a client is looking in NetSuite, what can they expect to see from NetSuite's pricing, can you talk to us about that?
Shawn: Yeah, it's pretty effective. It's pretty effective. The thing I like about their pricing models is it makes sense. Some of the vendors, again without getting into too much, it's like “you're going to price my software based off my employees?” I won't say who, or “you're going to do it off my number of transactions? I don't even know how many transactions I'm going to have.” Or “wow, it's only per user?” But Net Suite’s pricing makes sense in my mind, and maybe it’s because that's what JD E used to do, or PeopleSoft when I implemented those apps back in the 90s, but I work with a lot of apps. I mean we work with I wouldn't say hundreds of vendors, but we work with a lot of vendors.
It's like this, you're buying their Sweet Success Cloud Service, and here’re the modules it comes with, then, without getting into too many specifics, there's the user cost that goes with that. So you have modules, users, and then maybe you want more server capability, you paid for it. Maybe you want more legal entities wherever in other places than you pay for it. It's sort of a pay-as-you-play concept. It's like our lease for the office that you're sitting in Juliette. We have to pay for the space we have, and I think that's what NetSuite's done really well is having a very evident model. I don't think there are a lot of surprises for people.
Juliette: Pretty straightforward.
Shawn: That’s it, exactly. It's pretty straightforward.
Juliette: Yes, yes. Well Shawn, thank you so much for joining me today. You, as always, share so much knowledge with us and I appreciate it.
Shawn: You're welcome and thanks for letting me go on and on and on. Erica, by this point, would be like “you need to stop talking!”
Juliette: No, I think it's great. It's been really interesting to do this vendor series through the summer and get down and dirty with each of the vendors to learn more about them. I think it'll definitely help our team, clients, or prospects and that's why we're doing this.
Shawn: And even NetSuite, right? As we always say, I probably need to say this on every call, if there's something we're saying that we shouldn't be saying or is incorrect, you’ve got to tell us this.
Juliette: That's right.
Shawn: At the same time, our job is to sit between our customers and the vendors; the vendors are really important to us in Oracle NetSuite. We have a great relationship there. We have great relationships with a lot of vendors. But over the years it's been a really good partnership for us. They don't give us a dime, but they do give us food. Anybody can always send us food, and tumblers apparently, and sweatshirts. No, but seriously being independent and objective, what you need to do for our firm if you're a vendor, it's just to support the hell out of our clients and do everything possible to make them a success. That's it, and there are no more secrets than that. We really appreciate it when a vendor does that. I think NetSuite's done a good job of keeping that up over the years because it's hard when you get bigger, and get a lot of new people, to continue that. It's a huge organization, but there are two people that keep it going and we love that and really appreciate that, especially from NetSuite.
Juliette: For sure. Thank you, Shawn.
Shawn: You’re Welcome.
Juliette: And everyone, thank you again for joining us today. Please let us know if you have any questions. We're happy to help in any way we can. Call us, e-mail us, whatever works best for you. Be sure to join us for our next webinar scheduled for Thursday, August 18th, A Road Map to ERP Selection. We will help cut through the clutter and provide a guide to navigating ERP selections. Please go to our website, erpadvisorsgroup.com for more details and to register.
ERP Advisors group is one of the country's top independent enterprise software advisory firms. ERP Advisors Group advises mid to large-sized businesses on selecting and implementing business applications from enterprise resource planning, customer relationship management, human capital management, business intelligence, and other enterprise applications which equate to millions of dollars in software deals each year across many industries. This has been The ERP Advisor, thank you again for joining us.