NetSuite? For The Enterprise? Really?


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Bear with me for a second here, this is not about CRM, or about NetSuite for that matter even. This is about enterprise computing models.

I attended NetSuite’s SuiteWorld 2011 yesterday (it goes for 3 days, I could not make all three unfortunately) as a guest. That means they comped me on my registration, will reimburse me for my transportation expenses (if I ever get around to doing an expense report), fed me, and took me to a magnificent event last night with some of the best food I had in ages. I won’t bore you with details, but if I was someone to bend my ethics for any reason, that meal would’ve done it. Trust me.

(BTW, that was my disclaimer statement – in case the FCC is watching)

Back to my Choco Zucaritas with 1% Milk for breakfast world, I must confess I did not follow NetSuite a lot before. I knew of them, had come across them sometimes in my days at Gartner (and since them), and followed them via Press Releases.

I knew what they do, placed them in short lists for SME companies looking for ERP providers (with the caveat that I don’t follow either market extensively), and overall had a good opinion of them. However, I never understood where they were heading, their vision or strategy.

Ebbed by fellow influencer/advisor/analyst Paul Greenberg over time, I decided to spend time with them and find out what made them tick. I couldn’t have picked a better time to do so.

I spent most of the day yesterday looking at what they are trying to do, trying to understand their strategy. At first, I was not very impressed- it sounded like what they had been doing for some time. ERP and back office functions, working over the internet in hosted applications, function-specific modules. Then they mentioned adding Yammer as a partner (see Paul’s take on that in this video). It sounded like no more than just adding Social X to their product. Really, nothing to look at here that was not there before… except for Social through Yammer (which without a motive is simply activity stream noise that disturbs work – and the reason that most Salesforce Chatter users are not using it — but I will cover that in more detail later).

Then we went to lunch (side note: I had lunch with Kate Leggett from Forrester, who is doing amazing research on Customer Service – definitely worth putting her in your radar screen if not there already… I gave you her Twitter link, follow her).

When we came back in the afternoon, we talked about vision, strategy, where the cloud is going and where NetSuite would like to be. That’s when it got interesting: NetSuite wants to move up to the enterprise, and wants to bring cloud computing with them. I think it is a laudable goal here, but my fellow analysts are not so sure.

Dennis Howlett wrote the following, in a very well worded cautionary piece

NetSuite has always been ambitious and should be congratulated for its ability to move upmarket over the last couple of years. However, the kind of customer it is planning to engage exhibits a level of complexity that is an order of magnitude above that which they are used to managing

Kate Leggett was a little more direct, saying

It will be a challenge to see whether Netsuite can deliver as it makes inroads into the enterprise.

Me? I am more optimistic for their potential… but cautious to see how they execute. Here is why I think they have a chance, three reasons:

1) They are not doing it this year. This is a long term plan, something they are going to set their sights on and try to get there – soon, but not this year. It will take 2-3 years at least to align the enterprise needs and the changes that are necessary for them to adopt and embrace a model like NetSuite’s. It should take about the same or a little longer for NetSuite to strengthen their solution to meet them there.

2) They are more cloud that just about everyone in the enterprise today. Yes, that includes Salesforce and the other not-ready-to-commit-to-the-cloud vendors. Their platform has been developing quite nicely, thank you, and they showed what they can do today by showcasing how Yammer and Qontext (seemingly comparable choices for social computing, although not to those who spend time looking at the differences) can co-exist and work equally well within NetSuite. Without a platform, the level of integration they are seeking is just not doable (or very expensive and cumbersome — ask SAP and Oracle about it, even Microsoft — at least until Azure comes around).

3) The enterprise is willing to compromise and meet them halfway. The model they use, end-to-end processes that leverage the cloud, is going to be the leading computing model that enterprises will be adopting in the mid-term future. They need to be there to leverage what NetSuite has to offer.

Of course, this is not as simple as flipping a switch and writing some code or something like that. This is a process that will take years to achieve, and it requires a solid vision and steady leadership to get there. I think that NetSuite has that more than the other vendors, which is why I am confident that they can deliver it. Could they falter on the road? Absolutely, the only truth about cloud today is that is is badly misunderstood by most people and that we have long way to go before we get somewhere interesting with it. NetSuite is not exempt from this, same as everyone else.

I am confident that, for now, they have what they need to progress in their endeavor. I will continue to monitor them and report on their progress as I get updates.

What do you think? I am too optimistic? Is cloud really the future of Enterprise Computing? Should I have stopped at the fourth glass of champagne at the dinner event?

Republished with author's permission from original post.

Esteban Kolsky
ThinkJar, LLC
Esteban Kolsky is the founder of CRM intelligence & strategy where he works with vendors to create go-to market strategies for Customer Service and CRM and with end-users leveraging his results-driven, dynamic Customer Experience Management methodology to earn and retain loyal customers. Previously he was a well-known Gartner analyst and created a strategic consulting practice at eVergance.


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