We were invited to the first Acumatica analyst summit in Boston this week. For a vendor’s first event of this type, the summit was very well attended with key analysts in the audience, certainly kudos for a first event.

 
So here are my Top3 takeaways from the meetings:

A unique strategy – Acumatica is probably the only vendor in the enterprise software space that does not have a direct sales force, but exclusively sells through channels. That has happened before, but the products were standardized with little need to no demand for customization. For an ERP suite it is unique. The consequences are twofold in my view


 
  • Acumatica can focus CAPEX on product and does not have to invest precious funding dollars on expensive sales people, who need time to ramp up and learn how to sell the product, before they get into the ‘black’ for their employers.
  • Acumatica needs to focus on a very flexible, standard based product. As Acumatica does not know where partners will take the product, it needs to create value to attract them and at the same time make it easy to adopt its platform / product. 
With over 1000 customers and only 120 employees, Acumatica has a pretty unique employee population and cost structure. The bulk of the employee population works in R&D, Acumatica did not disclose specific numbers, but we think this is a safe assumption. In the go to market Acumatica needs to spare no effort to get partners up to speed quickly. The ramp up, training and marketing / sales options are attractive, with executives in charge who understand partner enablement well from their previous work experience.
 
Acumatica Marketecture

Standards and Flexibility rule – For the longest time SaaS providers have maintained that SaaS cannot be customized. Ironic as early SaaS pioneers NetSuite and Salesforce always offered customization options from the very start. Acumatica is no different and has created a powerful customization framework that allows the addition and insertions of fields, screens and control elements. Nothing teaches better than practice, and when Acumatica signed up Visma (largest Nordic ISV) to build their new product on its platform, it had to learn a more flexible and multi-tiered approach to extension and customization. The original one level for customer customization was taken by Visma, so nothing was left for its customers. But by now Acumatica has addressed this in a pretty elegant extension framework, which for a number of extensions does not even require a restart of the application, as it used dynamic and declarative (late) binding. 
 
Acumatica Deployment Options
At the same tune, standards are key - Hitting on an innuendo from Microsoft’s Build conference (my takeaways here), Acumatica made the point with ‘who wants to learn ObjectiveC’ (for those reader who don’t know that is Apple’s proprietary apps programming language). So for Acumatica it is support for C# and Microsoft SQL Server / Azure DB as well as MySQL. Using the powerful OData protocol Acumatica makes it easy for customers and partners to export, view and manipulate data. And it opens partnerships with e.g. Microsoft for Office365 and PowerBi. Acumatica is also flexible in terms of tenancy, as it supports a shared all, share apps / dedicated DB and shared nothing deployment arcitecture. And the vendor also sees deployments across different architecture, private partner clouds as well as public cloud, where (for now) fellow Seattle neighbor Amazon AWS is the most popular option. Finally Acumatica has invested in a mobile platform that allows a tech savvy user to build and deploy self-built mobile applications. A key step accounting for the trend of enabling the departmental, business end user.

On the roadmap Acumatica plans more capabilities to enrich the platform, e.g. more advanced workflow functionality, more pre-built mobile applets to aid partners to build mobile applications and deeper insights on what is happening inside of the Acumatica system in real time (BAM). 
 
Acumatica UI
xRP – a cloud ERP for late comers – Moreover we had the chance to sit down with the xRP team and talk to some early adopting partners. There are a lot of service providers and ISVs out there who are being caught in the transformation of enterprise software to become cloud based. For service providers the move to cloud is both a threat and an opportunity. A threat as implementation budgets shrink dramatically, an opportunity as the deep understanding of best practices garnered from many implementations opens the chance to become a product provider. And then there are still a lot of ISVs who for whatever reason have missed moving their core offering to the cloud. An alternative scenario has been that they only offer complimentary functionality to other enterprise automation areas. As a side note this happens even with successful vendors – see the recent NetSuite and Ultimate and SAP and IBM partnerships (see here and here). And as a testament of the market need, Acumatica has seen over 60 xRP signing up for the offering, which is only available since barely 9 months. The first ones of these partners are live, another proof point of the Acumatica platform.
 

MyPOV

The enterprise software value chain has been a traditional one stop shop for marketing, sales, implementation and support for the longest time. Digital disruption will come to the enterprise model sooner or later, with viral selling, flush marketing, almost no sales teams, partner enablement and business user empowerment as the key trends. It is good to see a vendor practicing a lot of that today, which should make Acumatica pretty disruption proof for things happening in enterprise software sooner, than later.

On the concern side Acumatica is still very small. It needs to make sure its core offering is modern and in tune with 21st century practices. Partnering with Magento for commerce is a good move, but Acumatica cannot do similar partnership for more modern best practices too many times, otherwise it risks to become a ‘backbone’ for other partners. And then its days will be counted, so the vendor not only needs to make sure the product has a modern and attractive architecture (we give Acumatica good grades here) but its core automation capabilities need to stand the test of time as well. Lastly the user interface is short before looking dated, a common challenge, as consumerization of IT is moving user interface best practices faster than ever.

But for now it is good news for Acumatica and its customers, a good platform, flexible deployment and fast ramp up times are what enterprises and partners need. It will be interesting to see Acumatica grow in the years to come, you can count on us to observer.
 
Find more coverage on the Constellation Research website here.
2012, 2013, 2014 & 2015 (C) Holger Mueller - All Rights Reserved

Business Research Themes

New C-Suite, Tech Optimization

Roles

Chief Financial Officer, Chief Information Officer

Tags

acumatica, cloud, erp, platform as a service, partner, platform