Cloud-based ERP levels the playing field for retailers

It makes a lot of sense that Oracle wants to buy NetSuite given its cloud-centric strategy, as the smaller company considers itself first to the cloud in enterprise resource management (ERP) software. But what they also have in common is by being cloud-first with their software portfolio, customers that couldn’t previously take advantage of large ERP software deployments can now do so online.

It’s something that Oracle CEO Mark Hurd noted in his keynote at this year’s OpenWorld, where he highlighted smaller, younger customers such as Uber-competitor Lyft and wireless HotSpot provider Boingo. Hurd said the prior to having cloud offerings, Oracle wouldn’t be involved with these smaller organizations because they don’t have any IT staff.

NetSuite now services 30,000 organizations in 160 countries and is adding 400 customers per year, according to company senior VP Steve Cerovcec, who kicked off a showcase of Canadian customers in Toronto Tuesday night, including retailers Casalife and Sears Canada.

Casalife owner Rob Whitfield said that as an early adopter of NetSuite it’s looking be agile as a bricks and mortar retailer adjusting to e-tail, while at the same time keeping an aggressive physical growth plan on track. “Our industry is changing a lot,” he said. One of the realities is that he competes with both smaller players and larger ones such as Walmart, all of which have the option of leveraging the same cloud software that his company does. “NetSuite has changed a lot since we started, challenging us to keep up, but we try to utilize new features as they come out.”

Casalife selected NetSuite shortly after its launch to manage financials, inventory, e-commerce, CRM and order processing, and has deployed it as the point-of-sale (POS) system for the company’s brick and mortar store, with bar scanning, tagging and salesperson access via mobile devices.

Casalife is experimenting with different store sizes, said Whitfield, ranging from 10,000 to 35,000 square feet, and looking to jump from three stores to 20 in the next eight years, while balancing e-tailing with traditional, physical stores. “There’s a balance between the two,” he said. “There’s certain trust factor that goes into bricks and mortar. You can sit on a sofa before buying.”

Whitfield said it’s encouraging to see companies in the same industry that are 50 to 60 times larger than his using NetSuite. “It gives the opportunity to be as big as anyone else.”

One of the larger companies is Sears Canada, but its NetSuite use is borne out of necessity to reinvent itself, said Corey Messom, GM of Sears Canada Innovation Labs, which is focused on e-commerce. “We’re a big ship trying to expand across Canada with big legacy infrastructure,” he said. “We really had to build a new boat.”

That new boat is not going to have a data centre, said Messom. Its local 30,000 square foot facility is being eliminated in favour of the cloud. Sears Canada’s business strategy from a technology perspective is cloud first, using 100 per cent cloud-based tools and leveraging APIs. “The goal is to be nimble and agile and create a lean ecosystem.”

A visible element of its new technology stack is a new Web site running as a pilot on the west coast, said Messom, which slated to be available across Canada by Black Friday (Nov. 25). In the meantime, Sears Canada’s nimble approach has it deploying technology in 90-day sprints rather than multi-year IT projects.

Jason Maynard, NetSuite’s executive of strategy, said the level playing field can be seen in the variety of companies NetSuite serves – small, medium and large. In the old days, the most sophisticated technology was reserved for the big companies.”

He said customers have voted through their choice of deploying to the cloud. “This is a big migration.” The question now: what comes after, once everything in sitting the cloud? The answer, said Maynard, is that it becomes a business platform. The conversation is going to shift from speeds and feeds … We’re going to talk about business value.”

Maynard believes we’ve hit the last computing platform as businesses have made the journey from mainframes to mobile computing, as how users access data has changed. “The view of the customer experience is very different than 10 years ago,” he said. “There is a wave of new workers, and consumers are coming into the market with a different set of expectations.”

This has meant challenging times for SMEs, but also a decreased lifespan for Fortune 500 companies, said Maynard. “The changes aren’t trivial.” Just as companies having be using hybrid technology, they know need to embrace hybrid business models – delivering products, services and offerings-a-as-service. “Every company has become a cloud company.”

This also includes delivering omnichannel experiences, which can be done by leveraging the power of data aggregation that comes with moving into the cloud, said Maynard. NetSuite, for example has four million unique logins and adds 9TB of data  to its system per quarter. “When you have all of this information in a centralized location, you can do some interesting things.”

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Gary Hilson
Gary Hilson
Gary Hilson is a Toronto-based freelance writer who has written thousands of words for print and pixel in publications across North America. His areas of interest and expertise include software, enterprise and networking technology, memory systems, green energy, sustainable transportation, and research and education. His articles have been published by EE Times, SolarEnergy.Net, Network Computing, InformationWeek, Computing Canada, Computer Dealer News, Toronto Business Times and the Ottawa Citizen, among others.

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