SAN DIEGO — In a bid to plug critical gaps in the manufacturing functionality of its enterprise applications, Microsoft Corp. today said it has acquired the software assets of eBECS Ltd., a UK-based vendor of lean production tools.
Terms of the acquisition, announced here at the annual Convergence gathering of Microsoft Dynamics ERP users, were not announced.
The addition of eBECS' applications, which fall under the Lean Enterprise brand, will initially provide an integrated lean manufacturing software option to users of Microsoft's Dynamics AX products. Microsoft also plans to integrate the eBECS lean applications with other Dynamics ERP applications, including Dynamics GP and NAV, according to Sharon Ward, manufacturing industry managing director at Microsoft. Microsoft will also continue to offer the eBECS products on a stand-alone basis.
The eBECS acquisition fills a hole in Microsoft's enterprise software offering for manufacturers, Ward said. "Compared to others in the market, the only area where there was a discrepancy between Dynamics and what other products offer was around lean," she said. "Now we've fixed that."
eBECS, a 40-person company, was founded in 2000 and has operated as a Microsoft Business Solutions partner since 2002, integrating its lean software tools with the Dynamics AX applications. eBECS' lean software supports processes such as supplier and production kanban, lean sales ordering, vendor-managed inventory, and lean alerts. It has been deployed at some of Microsoft's larger AX customers, including Haldex, a Swedish automotive supplier that has deployed 1,700 seats of Dynamics AX in 20 countries. Altogether, the eBECS applications have been deployed at 27 Dynamics AX customer sites, according to Kevin Hall, an eBECS spokesman. Automotive suppliers represent the largest manufacturing vertical for the eBECS product, he noted.
Microsoft acquired only eBECS' software assets, not the entire company. eBECS will continue to operate, Hall said, and plans to develop additional lean-oriented applications and to support products currently in use by eBECS customers. In addition, Hall said, the company will set up what he called "lean centers of excellence" to provide Microsoft customers with consulting on the implementation of lean production practices.
Microsoft's acquisition of the eBECS software follows by just over three months rival SAP's acquisition of lean scheduling software vendor Factory Logic.
Customers at Convergence were intrigued by the option of adding lean tools to their Dynamics AX deployments. Norman Carmichael, director of operations at American Technology Corp., a $10 million maker of audio equipment for military and commercial applications, said his company has begun reworking its production flow around kanban and other lean techniques. "Having tools integrated with our ERP system would certainly help," said Carmichael, whose company runs Dynamics AX 3 SP 3.
Microsoft also used the Convergence conference to introduce the Dynamics Client for Microsoft Office and SharePoint, a new user interface option that, in many ways, mirrors SAP's Duet product, developed in conjunction with Microsoft. Like Duet, Dynamics Client for Microsoft Office and SharePoint gives individuals access to ERP processes and data through interfaces to familiar Microsoft personal productivity software, such as Excel, Outlook, Word, and Microsoft's SharePoint portal product. Like Duet, Microsoft Dynamics Client for Office and SharePoint includes several predefined self-service applications, such as project time and expense reporting, and time and attendance reporting.
Also, like Duet, the new user interface option is aimed at providing an inexpensive, intuitive way for non-ERP users to access ERP data and processes. AMR Research Inc. has estimated that, on average, only between 15% and 20% of enterprise employees use deployed ERP systems, partly because user interfaces are too complex and require too much training.
Despite similarities to Duet, Microsoft officials said, Dynamics Client for Microsoft Office and SharePoint goes beyond the SAP product. "Dynamics Client is a broad superset of Duet's capabilities," Microsoft Corporate Vice President Satya Nadella told customers at Convergence. With the new Dynamics Client product, for example, Microsoft is providing tools that let customers create their own applications that tie into Microsoft's ERP platforms, Nadella said.
Dynamics Client for Microsoft Office and SharePoint will be available beginning in May on Great Plains (GP) 10, AX 4.0, and SL 7. Availability on NAV 5.1 will follow. The product will cost $195 per licensed user and $395 for the Dynamics Client Server.
In other news from Convergence, which drew 8,500 Dynamics customers, Microsoft:
- As expected, introduced new releases of its GP, NAV, and SL applications. GP 10, due to be available in June, includes a new Vista-like user interface, business intelligence enhancements, a new search capability, and a new workflow engine. NAV 5, which will be available later this month, includes deeper integration with Microsoft Office applications and support for new processes, including sales and purchase order approval and inventory costing. SL 7, due in June, includes a development tool upgrade to Visual Studio 2005, a new Office-like user interface, and role-based business intelligence.
- Unveiled Microsoft Dynamics Sure Step, an implementation methodology and set of tools intended to reduce deployment risk. The tools include a Business Modeler that graphically models a company's organizational structure and processes. Eventually, Microsoft officials said, the Business Modeler — or a tool like it — will be linked with the company's Windows Workflow Foundation technology to create a business process management tool. No time frame was provided for this.
- Announced a new partner program, Microsoft Industry Solutions, which will include a Certified for Microsoft Dynamics program, under which the company will certify that specific ISV and partner products operate properly when integrated with Dynamics products.
- Introduced the Online Financial Community, a Web site intended as a forum where professionals can gather to share ideas. Described as a MySpace for financial professionals, the online community will target corporate controllers, finance managers, finance staff, and accountants. Microsoft plans other online communities for other types of professionals, including those involved in manufacturing, officials said.
- Released partial results of a Microsoft-funded study comparing the usability of Microsoft and SAP applications. Microsoft said the study, conducted by Keystone Strategy Inc. and based on a survey of 100 Dynamics and SAP All-in-One and R/3 users, showed that users generally found Dynamics applications easier to use. Microsoft did not release the identities or sizes of the companies surveyed.