Managing Software:
Sizing up your options
Software vendors can be broken into three categories. The first group, generalist, offers a product that can be sold to any business. The advantages include the vendor's financial stability, scale, breadth of function and worldwide support. However, their products may not offer the depth of function needed in your operations. In many cases, their employees will be generalists and may not understand your business. Generalist products are typically priced higher. Examples of vendors in the generalist group include SAP, Peoplesoft, and JD Edwards.
Specialist, the second type of software vendor, specializes in process industries such as food, chemicals and pharmaceuticals. Since they focus on businesses like yours, you can expect a better fit. Usually, the specialist will have employees with more knowledge about your business. Examples of vendors in this group include Ross, Agilysis, and Infinium. Oracle might also be considered a member of this group although it is a generalist that has a series of modules specifically for process manufacturing.
The third group is the boutique vendor. These suppliers work at the category level. Their products only work for a single food category such as dairy, fruit and vegetable, or meat.
Boutique vendors can offer a near perfect fit to operational areas within a food segment. Due to their smaller markets, these products are typically for small- to medium-sized business. Biwer and Associates is an example of a boutique vendor who develops software geared toward the payment of growers and producers of agricultural commodities. Its applications manage the entire procurement process, including managing producer profiles, agreements and contracts, receiving, pricing calculations, and generation of payments and deductions. Boutique vendors like Biwer have intimate knowledge of the category and, as such, its products have unique category functions. On the downside, these products may not scale to handle the volumes required for larger businesses.
If your company is in multiple product categories, you may find it difficult to locate a boutique vendor that will meet all of your needs. If you work in a large company, the boutique vendor's products may not scale to meet your volume requirements. However, if boutique vendors exist for your category, you should consider these products benchmarks for other vendors and software.
For most food categories, the operational function provided by the specialist will do a good job. But before a final decision is made, look at a few specialist products to understand the difference in function between this group of vendors and the boutique or generalist vendors.
If your company produces various products, has divisions outside food, or operates globally, you may need a generalist vendor. The generalist will usually have the best in-class functions for those applications that do not vary by industry (general ledger, payables, etc.), but less food or category-specific functions in operational areas.
Your awareness of the types of vendors and their strengths will go a long way toward helping you find the proper fit for your company.
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