Listen as CEO, Erik Bush, and NextWorld CEO, Mark Goode, chat with Supply Chain Now. They discuss supply chain planning and execution, and how their partnership can move you to the future of ERP.
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Scott Luton (00:30):
Hey, good morning, good afternoon, good evening. Scott Luton and Greg White here with you on Supply Chain Now. Welcome to today’s livestream. Greg, how are we doing?
Greg White (00:38):
I’m doing very well, Scott. You know, I think about this frequently when I do this. You know that you have to do it this way.
Scott Luton (00:44):
Greg White (00:45):
Because in certain countries doing it the other way means something not friendly, so.
Scott Luton (00:51):
You know, there’s a scene in the Winston Churchill, the latest Winston Churchill movie, I can’t remember the name of it that’s really funny and it speaks right to your point. But, folks, you have to check that out on your own. Today we’re talking – Greg, we’re talking reboots in global industry, as in, is enterprise software ripe for a reboot? Greg, I think that’s a pretty fair question to ask. Right?
Greg White (01:15):
I think it’s a great question to ask. I’d love to answer it, but I want our analyst to answer it first, right? I think we all, at least in the back of our mind, know what the answer is, but I’d love – I can’t wait for our audience to hear what our panelists have to say from their perspective about the right answer.
Scott Luton (01:36):
That’s right. And as I was sharing on social last night, I think it was, there’s been lots of reboots. If you look at the Hollywood, it’s been like a proven path. Everything from the ‘80s, except Howard the Duck, no one has embraced that for a reboot, Greg.
Greg White (01:53):
And there’s good reason for that as well, Scott.
Scott Luton (01:56):
You’re right. Right. All right. Well, folks, we’re going to be talking about Enterprise Software and Is That Ripe for Reboot, with a home run, one-two punch in terms of panel here. So, stay tuned in just a second, as we bring those on. I want to say hello to a few folks. Of course, Katherine Hintz and Amanda and Chantel, all the folks behind the scenes helping to make production happen, hello to you. Happy Wednesday. Victor’s tuned in from Atlanta via LinkedIn. Great to see you there, Victor. Kristi from Duquette Minnesota via LinkedIn. Greg, ever been to Duquette?
Greg White (02:29):
I’m embarrassed to say I don’t know. I’ve been to a lot of towns in Minnesota, but I cannot remember. A long time ago. Maybe while snowmobiling, which anyone from Minnesota knows what that really means, I might have been in Duquette.
Scott Luton (02:49):
Well, Kristi, let us know what the temperature is like in Duquette this time of year. Hey, Ken, great to see you. From Cape town. Ken, if you remember, Greg, we all got together with Jenny Froome at Sapics and had a really fun supply chain trivia contest. Ken is quite a guru. So, Ken, great to see you here today. Wally says aloha from Southern California via LinkedIn. Aloha.
Greg White (03:14):
I bet we can predict the weather there.
Scott Luton (03:17):
I love that. I bet it’s gorgeous. Let’s see here. Prakritty, via LinkedIn, great to see you here. Let us know where you’re tuned in from as well. Okay. So, Greg, again, we’ve got quite the one-two punch today. We’ve had a lot of fun pre-show, talking golf and many other things with Erik and Mark. I want to welcome them in officially. Erik Bush, CEO of Demand Driven Technologies, and Mark Goode, President of Nextworld. Hey, hey Erik, how are you doing?
Erik Bush (03:50):
Scott, how are you doing? Doing great.
Scott Luton (03:52):
Great to see you. Great to see. Great to have you back. Love our repeat guests. And Mark, how are you doing, sir?
Mark Goode (03:56):
We’re doing fantastic in Denver today.
Scott Luton (03:58):
Wonderful. What’s the weather like out there in Denver?
Greg White (04:01):
Mark Goode (04:02):
Well, it’s cooling down. It’s all across the Midwest. We’re cooling down, but I’ve heard it’s moving your way. So, good luck with that.
Greg White (04:07):
Okay. Thank you.
Scott Luton (04:08):
Thank you. We need it today. It had been a little bit cooler, right, Erik? But we’re getting a little burst of –
Erik Bush (04:15):
There you go.
Scott Luton (04:15):
Late summer today.
Scott Luton (04:17):
Well, and like Kristi, ask and you shall receive. Kristi says “It’s 62 degrees up in Duquette, Minnesota.” That sounds gorgeous. And it’s south of Duluth, about 50 miles south.
Greg White (04:28):
Oh, okay. Probably have been there.
Scott Luton (04:31):
Right. We’re getting our geography lessons in here today. But, folks, before we get into Enterprise Software and Is It Ripe for A Reboot, Erik and Mark, the heavy hitting question we want to pose to you as we have a fun warmup, is it is one of our favorite’s birthdays today. It’s Bill Murray’s birthday, right? The iconic actor. So, the question, quick question for the panel here today, and we’ll start with you, Erik, what is your favorite all time Bill Murray movie?
Erik Bush (04:55):
I really got to kick out of Stripes. I mean, there’s a lot of [inaudible] –
Greg White (04:58):
Oh, my gosh.
Erik Bush (05:01):
You know, [inaudible] Sergeant.
Greg White (05:02):
[Inaudible] that’s brilliant.
Erik Bush (05:05):
But I also would want to – you know, he did a cameo role in Zombieland that was epic as well. You know, just a very short little piece, but I really got a kick out of Stripes was one of my favorites.
Scott Luton (05:18):
Greg White (05:18):
Scott Luton (05:20):
All right. So, Mark, that’s going to be tough to top there. What’s your favorite Bill Murray movie?
Mark Goode (05:27):
I’m probably aging myself here, but it’s Caddyshack.
Scott Luton (05:31):
All time classic. Of course.
Mark Goode (05:33):
Scott Luton (05:33):
He played the golf course maintenance professional. Right?
Mark Goode (05:37):
That was the battle with the golfers, the golfers.
Scott Luton (05:39):
Golfers and golfers, maybe who knows. Greg, how about you?
Greg White (05:45):
Well, since Caddyshack’s been taken, I’m going to say St. Vincent, which is kind of a sleeper movie where he plays a really rowdy dude who is a babysitter to Melissa McCarthy’s son. And it’s, you know, it’s a great story anyway, but, man, there are so many. Scott, what’s yours? Come on.
Scott Luton (06:05):
Oh, it’s, the cliche answer, but it’s a real answer Groundhog Day. I’ve watched that movie so many times. It’s so funny. I’m not crazy about the love story part of it. Right? But that where he’s trying to kind of just shoot through the days and find different ways of, you know, ending, ‘cause he keeps waking up and then he lets the Groundhog drive the truck, I mean, there’s so many funny, funny scenes in that movie. So, certainly an all-time classic, Groundhog Day.
Greg White (06:31):
I love the circularity of Caddyshack into Groundhog Day, right?
Scott Luton (06:36):
Yes. Yeah. We’re okay. We’re –
Greg White (06:40):
Bill Murray and underground environments. A key to comedy.
Scott Luton (06:46):
Oh, man. All right. So, we’re going to shift gears, make a hard right turn here today because we’re talking all things supply chain with our dear friends, Erik and Mark. And, Erik, I want to start with you. Share a question, prompt you with a question just to get the conversation going. In your view, what is wrong with ERP and other enterprise applications that are sold today for supply chain management and, you know, some other business purposes?
Erik Bush (07:12):
Well, you know, to really understand, I think that to give a proper response, we got to kind of wind the clock back about 20, 25 years when some of these movies were coming out and think about what were the problems people were trying to solve at the time. If you go back to the early to mid ‘90s, I was working in IBM consulting at the time. And one of the things that was really starting to take root was the whole ERP movement. Up till then a lot of big companies who are running on their own homegrown systems. ERP as a category really hadn’t taken the hill, if you will, at that time, and from an IT perspective, there were some real fundamental issues happening where customers or companies had so much legacy software that they were maintaining that they didn’t have any bandwidth to innovate and do new things. Right?
Erik Bush (07:58):
And if you think about that’s when the internet started exploding and .com and, you know, E-Business paradigm started coming to the front. And so, they’re stuck with legacy software maintenance. They’re stuck with islands of automation, and many of them were definitely afraid of what was going to happen with Y2K, you know, which was just a few years away. And so, I think ERP came in and they sold it’s all in one database, we’re going to maintain it for you so it’s going to be cheaper. This is going to free up working capital for you to shift into innovating more. And, it’s Y2K complaint. So, this is a very, very compelling argument at the time. The business guys in the room heard, oh, my God, this is all new software. It’s best of breed. It’s going to be so much better for us. And so, there was a, you know, land rush going after that.
Erik Bush (08:49):
Now, the reality is that in the supply chain segment of that portfolio, the ERP landscape, the logic that they were bringing to the market was the same stuff that had been around for 20 years at that time. Right? And it never really got evolved from that point, so we’re seeing this now. When you look at statistics from the Federal Reserve Bank, it shows that US manufacturers’ inventory turnover rates are today what they were 25 years ago in spite of the billions of dollars that were spent on ERP during that horizon. So I think the business guys heard we’re going to reengineer, we’re going to get to a better place. Then the needle didn’t move. Right? And so, they’re still suffering the same impediments today that they were all that time ago.
Erik Bush (09:33):
So, now I think what you’re seeing in the market is clients are starting to recognize that a big monolithic platform may not answer all your questions, especially in critical areas. And if you think about salesforce.com, they took the customer relationship management portion of ERP and did it way better, you know, and I think there’s a link of all of this into the what Mark and Nextworld are doing that is really, really important to understand. So, I think that the issue is that we’re two-and-a-half decades downstream now. The code is the code is the code. If anything, those ERP companies are struggling to get into the cloud and to provide more flexibility. And they’ve got the issue of legacy maintenance now themselves, right? Trying to pivot to current market conditions I think is a real problem for them.
Scott Luton (10:26):
So, Erik, that is quite a masterful job at level setting. You covered a lot of ground there. And by the way, kids these days will have no clue about how that Y2K thing and everybody’s shaking their boots, right?
Greg White (10:37):
I was thinking about that. Right? I mean, that was the last time we thought the world was going to end. Right?
Scott Luton (10:43):
Mark, I’m going to get you, Mark and Greg, to comment there. Mark, what comes to mind, you know, what, as Erik was level setting, before we get into some main priorities that clients are highlighting now, we’ll get to that in just a second, but Mark, any thoughts that I prompted for you?
Mark Goode (10:57):
Well, I think the, you know, I think what Erik was venturing into was, you know, when you look at the current state of the IT landscape today, you know, I was just reading an article yesterday from Gartner that, you know, they’re always off by a couple years, but by 2026, over 60% of the product-centric companies will have implemented some type of composable architecture with an embedded analytics layer. And, you know, I think it’s interesting to look at that market share trend that, you know, during the ‘80s and the ‘90s, you know, a lot of the ERP landscapes really took a land grab for everything. We can do everything. And now when you think about composable architecture and with cloud computing, now you have the ability to say, I’m going to take best of breed and I’m going to build a best of suite.
Mark Goode (11:52):
So, you know, I think along with that cloud computing, you know, one of the things that’s evolved, that’s a tremendous asset, I mean, we think about it every day is, you know, with cloud computing, you get an enhanced security layer and, you know, if you’re managing your own on-premise systems, you have to manage your own security, it’s hard to keep up with it. But one thing that I think is often under looked is that cloud computing brings a tremendous amount of, it brings another layer of security and a lot more security tools that we didn’t have before, you know, ‘coz getting an intrusion or getting malware or, you know, getting any type of ransomware in your company, it can be a death threat. So, you know, that’s the only thing I would add to that.
Scott Luton (12:32):
Appreciate that. Cyber’s going to be all the raise, all the rage, and we’re going to see a lot more activity from bad actors in the months come for sure. Greg, your thoughts as we’re level setting here on the front end.
Greg White (12:43):
Yeah. I mean, the promise of ERP was much different than the reality of ERP. I mean let’s face it, ERPs were basically finance systems. QuickBook. QuickBooks could argue these days that they are an ERP, right? Because it all started with finance and automating finance. And in fact, SAP, the biggest of all of them still has code from the 1950s in their technology. So, it tells you kind of where they started from. And, in fact, while they wanted to be that best of breed solution, it was quickly realized, and think about the dates we’re talking about here, right? The ‘70s, ‘80s, and ‘90s. And that was the heyday of ERP. That’s when they were really, really mature companies and growing incredibly fast. So, you know, what happened was they built finance and customers asked for more and more of the adjacent technologies, and solutions and they kind of slapped them in there unscientifically.
Greg White (13:45):
You know, for instance, what Erik and his team do at Demand Driven Technologies, the MRP functionality, it was very rudimentary very often in an ERP. And Mark, I mean, we haven’t really talked about this, but the provenance, Scott, of – thank you – of Nextworld is one of the later ERP companies, JD Edwards, JDE, which started in 1977. So, a relative newcomer in that time. And they’ve got a lot of that provenance with Kylee McVaney, their CEO. And, honestly, look, this is just an observation from doing a little research here. For people with a history and traditional ERP to make the leap to understand the evolution of technology into cloud and the power of cloud and to take both the extensive expertise that they’ve got and apply that to new technologies is really, really rare. We did that at Blue Ridge and it was no small struggle to do that, but fortunately, both of these companies have overcome that sort of legacy and recognized the power that’s in the cloud to enable real best of breed and some incredible new capabilities that all of the power of the cloud provides for you.
Scott Luton (15:09):
I appreciate you sharing there. One quick comment before we shifted back over to you, Erik. TSquared, who holds down the fort for us in YouTube, says, “Y2K definitely had me shook as a college student because all things computer were subject to be getting shut down.” That was kind of like the mindset back then if y’all remember, back in ’99. It was crazy. Okay. So, Erik, moving right along – I’d tell you that was a very healthy level setting segment on the front end as we look kind of, did a look back and kind of how things evolved, but let’s talk about today, right? So, Erik, what are some of the main priorities that clients are highlighting today?
Erik Bush (15:46):
I’m going to talk to it mostly from a supply chain perspective ‘cause that’s the space that we deal with. But I think that there’s a couple fundamental issues. Go back to the comment I made about inventory turnover rates haven’t been improving. And, yet if you are in a company like that and you’re sitting on all this inventory, you’re sitting on a lot of cash, working capital, that you could pivot and use to help whatever strategic intent you’re trying to follow for your company. One of our clients in the automotive industry is engaged in a project with us to roll out to a hundred plants, free up a hundred million in working capital, because bringing up that cash allows them to accelerate their shift in their role within the automotive industry. So, we have to unlock those improvements. That opportunity is absolutely there. We’ve proven that time and time again. And I think that’s kind of what they’re trying to get to at a high level from a financial perspective.
Erik Bush (16:39):
The second problem they’re finding is that the workforce, the people who use supply chain planning software, is evolving in a declining manner. Meaning, back in the day, you go back 20 years, there was a thing called a certified production inventory control manager, CPIM certification, from a group called APICS, American Production Inventory Control Society, who had a huge membership, you know, here in the states and around the world and the like, and you would see guys at these conferences with a list of certifications attached to their conference badge, right? They were proud of all the knowledge they had. That’s a dime breed. I’m telling you. The gray-haired guys like me, they’re disappearing, and what’s coming up instead into these roles are younger people who grew up on laptops and touch screens and iPhones and modern technology. And they’re looking at the software that’s in their space that they’re trying to use.
Erik Bush (17:38):
Erik Bush (18:19):
Why is it that we have to have users checking the math of the system they ask, right? Because when they get into that mode, what we end up with is the inability to scale. We can’t take a planning approach and roll it out to a hundred plants because every plant’s got their own secret sauce. They have shaman in the tent, if you will, who has all the wisdom to figure it out for them. And so, there’s no scalability. So, they want results. They want an easier to use, easier to deploy platform and functionality. And they want to take a lot of the workload out of it. Let’s rely on the system to do the job force, you know. Mark, I’m sure you guys do fly all around the world and all this kind of stuff, and the pilots rarely flying the plane. They’re allowing the system to do the job. They get involved on take-off landing and exceptions. Why is it we can’t manage inventory that way?
Scott Luton (19:13):
Interesting. Okay. Mark, I’m coming to you next, your thoughts when it comes to priorities you’re seeing here today or what some Erik has shared.
Mark Goode (19:21):
Well, I think it’s – I think, you know, what I would echo is nothing has really changed for a long, long time. I remember about 20 years ago, I walked into a top 20 manufacturing company in United States and made a customer satisfaction call. And, the CIO literally threw me out of his office. And, his whole principle was, I’ve spent 400 million on this ERP, 400 million, and I’m nowhere. And I think, you know, as we work, you know, part of our portfolio today at Nextworld is we sell inventory management as an edge to ERP. And we see these implementations still that people have this vast idea what ERP is that it can do supply chain and it can do all this stuff. And it never gets fully implemented. It never gets fully – and immediately, you know, the technical debt starts to mound. But it really gets people locked then in their business agility. And if there’s one thing that’s parallel to the digital economy, it’s business agility. And, you know, that’s the one thing that ERP was, you know, I think people misinterpreted what it was. It was to lockdown processes, but they were locked down. You weren’t changing them, right? You weren’t changing. If you were going to change them, you better have a lot of dollars in your wallet to go change it. So, you know, the name of the game with what we’re seeing in SaaS and cloud computing is is total cost of ownership and your ability to move forward quickly. And, you know, I’ll echo what Erik said again, is that, you know, what we have available for a labor resource pool is changing dramatically.
Mark Goode (21:04):
And you know, what we’re finding out with our solutions, business analyst can use these solutions and they can implement the solutions. And that’s a major, major shift, you know, that, you know, where people want to go on their career. You know, if you were an SAP program, you had to know, [inaudible]. If you were an E-Business program, you had a new E-business. If you’re using that suite, you got to know Java and people don’t want to be siloed into those technologies. And, you know, they want to be more business problem solvers. And so, business analysts can use a lot of these modern SaaS composable architecture to compose the applications, adjust your workflow, and be agile on your business approach.
Scott Luton (21:44):
I love that, Mark. Greg, I’m coming you next, but really quick. Erik mentioned some of the certifications. Hello, Gene Pledger. You’ll see some of those certifications behind his name there, [Inaudible], CPIM.
Greg White (21:54):
The very one [inaudible] as a matter of fact.
Scott Luton (21:55):
Greg White (21:56):
Scott Luton (21:57):
And he’s probably recollecting Y2K where Gene was back then. But really quick, Greg, get your take, but Erik referenced APICS, the American Production Inventory Control Society, founded in Cleveland back in the ‘50s that has morphed into what is down on his ASCM. They’re having their conference this week. So, just to kind of connect dots for folks. Greg, we’re talking about current priorities for the market. You, you heard Erik and Mark’s take there. Your thoughts.
Greg White (22:25):
Yeah. The world has changed. And unfortunately, a lot of ERPs are a slave to the old world, right? In the old days, Erik, you may recall this that even at IBM you deployed what was called a kernel of technology, and then you built all the functionality around it, which made the big consulting gigs and the big implementation gigs that Mark was talking about an absolute necessity. And then, companies like Accenture and other big consulting firms built entire practices around it. So, for example, for many, I’m not going to single out any more up for the rest of the show. People are talking about a particular one and the truth is it’s ERP generally. Put any letters together and it’s ERP, right? I mean, especially the older ERPs. But they became a slave to that because if those ERPs wanted to sell their technology, they had to leave the ability to make tens or hundreds of millions or billions of dollars on implementation in the design of the product.
Greg White (23:23):
And as both Mark and Erik have talked about that philosophy has gone the way of the one. It’s only a few of us, old gray-haired folks, that still even recollect that. It’s not even the expectation, just the expectation of these new generations. It’s the presumption that everything is as simple as an app. I recall – I’ll keep this brief – but I recall growing up on windows, which now seems like it was a thousand years ago or on apple OS, right, where everything was object-oriented. And then, going to the first retail company that I went to work for and saw something called a green screen, which really a black screen with green letters on it that made me feel like, to Erik’s point, I was navigating Apollo 13 in the 1960s. So, I think we have to recognize that things have change, economies have changed and that companies are doing what – I’m sorry, it was either Erik or Mark said – they’re now just leaving these old ERPs in place in some cases and layering the ability to manage the wealth of data that exists in them. And they are further and further partitioning the deep applications that add value, like demand, like MRP and demand forecasting and various sundry other things into this technology. But more and more, even the old guard, are sort of dumping – one major ERP provider is basically dumping their old on-premise model and they’re deploying a new brand that is cloud-based. Right? I bet Mark knows that one pretty well, ‘coz [inaudible] against them every single day. So, even those big companies have recognized that their model is dead or dying and that they have to change things to meet the expectations, presumptions of today’s user.
Scott Luton (25:30):
Well said, and all the space talk, I’m looking forward to the Artemis, the next launch window, what a fascinating program that is. Okay. So, Mark, we’ve referenced this a couple of times. If you can shed some light on the background of Nextworld and what are those key differentiators in ERP software.
Mark Goode (25:50):
Well, I think the biggest differentiator is the background. So, Nextworld was started by Ed McVaney and four others founders, one of them including his daughter, Kylee McVaney. You know, Ed was really one of those pioneers in his company was JD Edwards. And, you know, Ed was one of those pioneers in the beginnings of the ERP and, you know, JD Edwards went public and it was acquired by PeopleSoft and Oracle got a battle hostile taker with PeopleSoft. It acquired JD Edwards and then basically, you know, milk the maintenance on it. But, you know, the one thing that was always fascinating about JD Edwards was, is, you know, the total cost of ownership of it compared to his competition was amazing. You know, it was – you know, a couple people could manage the whole ERP implementation, but, you know, Ed never forgot about, you know, what the drawbacks were and the drawbacks were is you had to install it, you had to deploy it. You had to hire consulting firm and then you had to upgrade it.
Mark Goode (26:51):
So, you know, six years ago, they started Nextworld and we literally spent four years just building a contemporary SaaS platform. And, you know, if I would make an analogy, you know, what salesforce.com did for CRM, a business analyst can pick up the tool and deploy an application. That’s really what we’re doing for ERP. A business analyst can use Nextworld to deploy applications to run their business. And, you know, the secret sauce in that is you remember the – you know, back in the early 2000s, when Salesforce got started was the circle on no software. Remember that? It’s kind of like Ghostbuster circle? So, the whole idea of an upgrade goes out the window. It goes out the window. We’re talking about releases and in our value prop to our customer base is you’ll never be left behind. You’ll never be left behind and, you know, but we’re always going to give you that business agility. We’re going to give you that business agility and that total cost of ownership of all the business benefits of cloud computing also.
Scott Luton (27:59):
So, Mark, follow up, I think you may have touched on this, but the 11th commandment, I believe, literally reads thou shall not customize.
Mark Goode (28:08):
Scott Luton (28:08):
So, speak to customization when it comes to ERP.
Mark Goode (28:11):
Yeah. Well, we’re breaking that paradigm. And again, you know, a configuration is a customization. Bottom line is you can’t strain your business, constrain your business agility. And the one thing that’s incredible about our platform is we believe in extensibility. So we believe in the fact that if there’s an application that we don’t have in our portfolio, then you can build an application. You literally can pick up our platform and build an application. And when you’re building that application, be assured, it’s going to meet all your compliance and all your regulatory compliances, and it’s going to integrate to everything else that you’ve touched. So, you know, there’s design principles and things like that you need to pay attention to, but, you know, we’re breaking that paradigm. We want you to configure the system. We want you to customize it towards your business processes. Use our workflow engine to be agile making business decisions, you know, because as Erik talked about it, you know, there is an exception though. Planes can land themselves now.
Greg White (29:14):
Erik Bush (29:14):
Yeah, they can. I know. And I can tell when I’m landing in one.
Mark Goode (29:18):
You know, but it – so, there’s, you know, the system and building workflow is smart enough to make decisions based on conditional things we program, but, really, it breaks the paradigm that don’t worry about customizations, you know, or believe you’re going to move on to the next release. And the way that the whole platform is architected is we’re never going to be stuck with legacy technology. As new tools come out, we’re going to be layering things into our platform that our customers will never have to know about it.
Scott Luton (29:48):
It’s good to break some stuff, Mark, so I appreciate you sharing that. I want to share a couple quick comments and then we’ll get a great quick comment from Greg. And then, Erik, we’re going to go into Demand Driven Technologies here in a second and get some of your key differentiators. Wally says, “Very interesting to see articles on company strategy where they are deciding to simply sit on inventory as opposed to right sizing it as demand slows. Companies that continue to over buy will never get out of the cash crunch. There’s got to be a better way.” Well said there, Wally. Well said.
Greg White (30:20):
They will get out of the cash crunch ‘coz they’ll go bankrupt. But –
Scott Luton (30:23):
Rainee. I think this is Rainee. I think I got your name right. If I got it wrong, let us know. Says, “I often find that a frustration with many ERP systems is due to the lack of knowledge and proper use and implementation. Companies will piecemeal or only use certain modules within these systems or use these modules incorrectly.” Interesting comment there, Rainee. Okay, Greg, your quick comment as Mark was talking about some key differentiators, and then we’re going to go to Erik next. Greg.
Greg White (30:51):
Yeah. Customization in the classic sense is just like ERP, historical ERP legacy, ERP in the classic sense. It’s code behind that you might never know about that only your implementation provider may only know about and that even your ERP provider may not know about so it can get wiped out as you get upgraded. To Mark’s point because they’re using technology that doesn’t use code behind, low code or no code, then users can deploy it and it can be made aware to the provider, like Nextworld, that that stuff exists and they can defend it, protect it and support it when you upgrade ‘coz those are the classic problems, right? Your technology becomes unsupportable and then you become stuck with those practices and processes and screens and technologies that you don’t understand like Rainee is talking about.
Scott Luton (31:45):
Okay. A lot of good stuff there. Erik, I want to give you the option here. You’re going to be – we’ll give you the quarterback option to call [inaudible] and feel free to comment on what Mark and Greg have been stating there. And then I want to get into some of your key differentiators when it comes to supply chain software. So, first comment on what you heard Greg and Mark speak to there.
Erik Bush (32:03):
Yeah. I think the Nextworld story is phenomenal. Since we learned about them a couple years ago, and I’ll talk a little bit about our partnership with them in a few minutes, but, you know, it’s like getting the band back together. But you come in, if you only knew then what you knew now, right, you’ve got all this learning that Mark alluded to here in his comments about what were the limitations, what were the things we could have done better. And I think that the approach that they’ve demonstrated we’ve had countless conversations over the past couple years as we’ve started to fuse our partnership together just revealed a very, very different culture than I’ve seen in other software companies. Right? And the whole premise of this extensibility is I think very appropriate and effective in the way that they’re approaching it so that you get – you don’t paint yourself into a corner.
Erik Bush (32:54):
I saw this happen with so many SAP clients where they would write so much code to customize ‘coz they had to have this and that and the other thing. And now, all of a sudden, they’re stranded on a given release because to move forward, they have to now go back and refactor that code to meet the new standards and the new release. And if we have the ability to make those enhancements or customizations or extensions, as you want to call them, without being painted into a corner, we are in a far different position than we’ve been historically. One of the large national tire manufacturers, we watched customize their sales and distribution model and SAP to an enormous level, because they had so many different discount programs that they offered into the market. And you got to believe at some point you’ve passed the knee of the curve there where, you know, after the first three, maybe you had enough and you could have cut these off, but they just kept going and going and going and they’re creating their own problems.
Erik Bush (33:54):
And I think that there’s also on the client side a need to be more pragmatic and judicious and use those capabilities in a good way so that you don’t overcomplicate things, and go back to one of the comments earlier that people don’t get all the software implemented. Right? Well, that’s because there’s a lot of software to implement and there’s a lot of features and decisions people have to make when you do that implementation. So, the more you can grease those skids, the more you can smooth the pathway to getting business, the better off you’re going to be. Right?
Scott Luton (34:28):
Good stuff there. We need to bolt on another hour here between the three of y’all talking technology in business, global business and supply chain. But, Erik, in particular, let’s focus in now on the background of the Demand Driven Technologies and your key differentiators when it comes to supply chain software.
Erik Bush (34:45):
When we started the company, there was one competitive strategy that we focused on. If ERP is long, labor intensive and the needle isn’t going to move, then we have to be everything’s that’s the opposite of that. Meaning, you get a result and you’re able to sustain it. And it doesn’t take, you know, the King’s army and ransom to get there, right? That you can get there in a few months. And that’s what we focus on. So, I think at our core, we are driven by getting clients to the right results. We do that through offering them simulations so we can actually replay, you know, quarterback – Monday morning quarterback and say have you used these techniques? Here’s where you would’ve been in terms of inventory level, service levels and things like that. And that’s working. It puts us on the same side of the table with our clients. And I think they really value the approach we take to and our concern about their needs and priorities.
Erik Bush (35:43):
I think the other key piece that’s a differentiator is that we have made the foundational decision that we are going to build agility as the first premise, not predictability. Meaning, that our solutions are designed to allow you to pace your inventory, supply your production schedules to the real demand, not the forecast, but the actual demand in the market. It’s the most accurate signal you’re going to get. And there’s different ways of getting there. Everyone in the past thought you had to have a forecast ‘coz that’s way MRP worked. And we’ve said, you know, there’s too much air out there. Let’s start with a cleaner demand signal and we’ll get into a much, much better place. Once you make that shift in thinking, it opens up a lot of doors because now look at everybody’s talking about agility. Well, to be able to pace to the actual demand coming in, you’ve got to build that agility into your business. So, our platform helps clients put that foundation in place, right, and get better results and do it in a much more manageable way.
Scott Luton (36:45):
Okay. So, we’re going to get into the partnership next. But, Greg, that demand signal and being able to really adjust your planning and operationalizing that, speak to that really quick for a second, Greg.
Greg White (36:59):
Well, you know, I call it post casting, right? What Erik is referring to is what they tried to avoid is looking at history and expecting that to be an indicator of the future. Now, let say that again slowly for the people in the back. Looking at history and expecting that to be the indicator of the future. Think about 2020 and the great toilet paper shortage. Could anyone have looked at history and in any way ever predicted that that could happen? No, of course not. Right? So, what we have to understand is what are those indicators of demand now, and that’s what Erik is talking about, and how do we leverage those to have a more accurate prediction? And I really love the idea of focusing on the agility because for too long in supply chain planning, in particular, we have focused on the forecast and cost. And we’ve done that at the expense of enabling a solution with the agility, the responsiveness, the recovery and resiliency that is required in a supply chain always has always been but is so clear and apparent to everyone on the planet today. So that perspective is a huge differentiator.
Scott Luton (38:06):
I love it. Hey, if it’s clear to everybody on the planet, I wish you’re doing a lot more of that. Erik, I want to get into this partnership, this pretty cool partnership between Nextworld and Demand Driven Technologies. Speak to that and speak about how their approach, Erik, can help some of our listeners’ companies and customers.
Erik Bush (38:24):
So, yeah, we’re really proud of the relationship we’ve got. I’ve spent quite a bit of time with Mark over the past several months. Nextworld reached out to us about a year and a half ago as they were starting to get ready to launch into the market and they were intrigued with the demand of the methods that we support and they made a decision to interface into our solution to address those functionalities instead of building their own platform. Right? And so, we are engaged with a number of clients right now as, in very, very cool opportunities that we’re working on together. Mark didn’t mention, but they have a platform called Nextbot, which is an application development environment. Think of that. And it’s a low code, no code kind of paradigm. And so, we would expect that as we get the engine running here and start to really do a number of deals together, that we will essentially migrate our code into their Nextbot environment, thus fusing the UI relationships together and things like that as we go forward. And that spans not only inventory planning, but production scheduling, S&OP, and things like that. So, we’ve really had a great working relationship together. I think Mark and I have a shared vision about where this partnership can go and very excited about the opportunities going forward.
Scott Luton (39:40):
Love it. Well, Mark, I’m going to get your take on the partnership. But first, those landings back on the plane, that comment hasn’t escaped me yet. When you bounce off the runway a couple times, is that the bots doing it, Mark? I don’t know. But tell us about – give us your take on the partnership, Mark.
Mark Goode (39:59):
Well, I think, you know, I hope I haven’t used this example too many times, but I’m going to draw upon it one more time because, you know, we’ve all been in this business for so long and there’s so much you learn from history, you know, about what things work and don’t work. And we were talking about Y2K earlier, and I want to bring up a company name and maybe I shouldn’t do this, but I think the historical relevance is important. You remember Siebel Systems?
Scott Luton (40:24):
Greg White (40:25):
Mark Goode (39:59):
The [inaudible] and just as long as people had great big pocket books, man, they were implemented like crazy. Well, after Y2K and 9/11, nobody had any more money and, you know, and then here comes Salesforce, right? And, Salesforce becomes a 900-pound grill overnight. And, you know, part of Salesforce’s strategy, as I explained before, was, is, you know, very similar to what we’re doing for ERP. And I think you’re going to see the same trajectory in our dominance of the marketplace. I think that big or profound effect, you know, bringing a no code ERP platform to the market. But, you know, if you followed Salesforce over the years, I think to the most successful software company in the history of the world. I mean, you know, they’re very predictive in how they grow, but you remember several years ago, they said, “Hey, we’re going to grow our applications business, our ecosystem. You know, it’ll be just as big as, you know, our CRM portfolio.” And they have. So, people build on the Salesforce platform. I mean, you can go buy an app on the Salesforce platform.
Mark Goode (41:31):
You know, it’s like you buy an iOS app on the app store. So that’s the way we’re approaching the ecosystem in the market is, you know, we’re going to have ISB relationships. We’re going to integrate. But, you know, what Erik and I are talking about is really, you know, developing some best-in-class apps on our platform. And again, it’s the way that our architecture’s composed is you can take as big as bite as you want. Take a little bite now. You can take a bigger bite later. We’re totally fine with that. We want to grow with our customers. You know, Erik is right. We see this market exactly the same, more specifically on going to market. We’re both after product-centric companies. And what’s unique about us is we see the product centricity and also service companies relying on product.
Mark Goode (42:20):
In the digital economy, you know, the reason this is so important is, you know, traditionally ERPs looked at inventory within the four walls. Okay. Well, has Amazon broken that paradigm? Do you think they think about inventory within their four walls? No. It’s about the long mile. It’s about where is my product going? And, you know, we’ve already got all those great capabilities with the cloud inventory platform and Nextworld working together right now is when that product leaves the four walls, we’re going to help you track and manage that product, you know, and if you think about a traditional field service application, where are my parts to service, whatever I’m going to work on. And that’s what, you know, Erik and I are talking about, the evolution of our working relationship. Yes, it is about MRP. It’s about manufacturing, but inventory is in the while. You know, inventory is absolutely in the while.
Mark Goode (43:15):
And, you know, seeing that inventory is part of your supply chain and still that narrative back from ERP, ERP stole the narrative supply chain. And, you know, we see it as a holistic approach and the way we see manufacturing materials, warehousing, and field inventory, all in this cloud of inventory, Erik and I are completely aligned and, you know, all the folks on this call today, I mean, you’re going to watch, the trajectory of our company really go through the ceiling.
Scott Luton (43:46):
That’s exciting. So, congrats on this partnership. It sounds like you’re just about to hit the fifth or sixth gear, so looking forward to seeing the results and outcomes. Greg, I’m going to get your comment here. But first I’m going to share a couple here. One from Chad. Chad, great to see you. Chad joined us on the livestream a couple months back. Hope this finds you well. And by the way, Chad is in Denver as well, Mark. He says, “Siebel had a great vision, but the system failed to deliver because it was very cumbersome. Salesforce has definitely done well to build the ecosystem. Another good example is Atlassian, Jira.” Jira, maybe, I don’t know. Greg from Milwaukee. Greg, hope this finds you well, says, “The forecast of the future is a guess and is incorrect after published. Too many variables. All based on prediction, especially when you have to look out six months or longer to order supplies.” Great comment there, Greg. Now to our Greg, Greg White, before we make sure folks know how to connect the dots, connect with Mark and Erik, and we got some great resources from Erik’s team to share momentarily, your final thought maybe on the partnership and some of the things that Erik and Mark have shared.
Greg White (44:50):
Yeah. I love the perspective of the Salesforce ecosystem and using that in supply chain and for ERP and finance and other solutions because it works and, you know, the fact that there are companies that have built their platform, cloud native is what we called it, way back in 2011, it was built for the cloud, not adapted from on-prem. And it takes full advantage of the processing power, the new technologies that are available to you, the ease of integration and these no code and other types of solutions that allow you to adapt your solution right to the edge of customization. I can already see in the comments that we’re having this discussion around customization or configuration. That’s not even the point, what word you use. You need to rethink the term customization because the baggage that we all carry is all of that code behind the scenes that got lost or got wiped out, or, you know, or kept us from getting upgraded.
Greg White (45:55):
That’s not the case anymore, and it doesn’t need to be. And we need to think about this more as the digital natives who are naive to those old ways, and just presume that this is the way that things always should have been built. And now we have the technology that enables that, and it’s a huge leap forward, and it will disrupt the industry. And it is an industry right for disruption. There’s only one, in my opinion, current ERP player that is sufficiently equipped to compete with what Nextworld and Demand Driven are doing. And that is a great spot to be in for both us as users, they as service and technology providers. It’s a great spot to be in, and it will dramatically advance how technology is used and how it’s deployed particularly in supply chain, but also all of the other areas around business operations.
Scott Luton (46:52):
Well said, good stuff there. All right. So, I want to get into as we’re coming down the final stretch here, right. And Erik, I’m actually going to start with you. We’re going to share some of those resources now, and then we’ll get with Mark and how folks can learn more there about Nextworld. So, I’m going to start with Erik. So, Erik, we’ve got some resources to bear. I appreciate what you and the team – first that we’ve got a white paper focused on simulating demand-driven material requirements planning aka DDMRP, those buffers. So, Erik, and we’re going to drop a link into comment, why should folks check out that resource?
Erik Bush (47:24):
I think it’s a great example. We started doing these years and years ago, and the white paper was actually written at the back of an APICS conference where we had done this simulation, where people came into our booth, they gave us random demand patterns, 10 days of demand. We collected them all and we showed them how we could buffer without having any idea what numbers they were giving us and successfully have high service levels and low inventory levels in that. And it was kind of amazing little gambit to do, but it really helped people get the idea that, hey, maybe there is a different way of planning your materials. And so, that white paper is kind of an illustration of what we learned that day. And, I think it helps kind of turn the light bulb on for a lot of people when they read it. It continues to be our most widely downloaded white paper.
Scott Luton (48:11):
Hey, some of the best things come out on the back of a bar napkin, right, Erik?
Erik Bush (48:15):
Yeah. And it’s kind of all in the same philosophy. We do the same thing then when we meet with clients because we’ll get their data and then we’ll show them what actually what happens. So, it’s a good kind of a teaser around what simulating a DDMRP environment would do for you.
Scott Luton (48:29):
Love that. And then the second resource that y’all brought, I was just watching this morning on the History Channel a documentary on the Cola Wars. And it’s really fascinating, especially the last 50 or 60 years. You know, the triumphant market entry that Diet Coke made is so fascinating. Anyway, speaking of Coke, folks should check out a really neat case study on Coca-Cola beverages in Africa, and its continuous improvement initiatives, especially those involving its work with DDMRP. And we’ve got a link to that as well. Erik, one final question for you is how can folks connect with you and your team?
Erik Bush (49:04):
Best way to do it is to reach out to us either through LinkedIn or at firstname.lastname@example.org or to our website, many, many ways to get in touch with us and we’d love to talk to you.
Scott Luton (49:17):
Wonderful. Folks, y’all check out those links. Thanks so much for all you’ve shared here today, Erik. I want to switch over to Mark. Mark, really have enjoyed your perspective. I look forward to – as y’all two work more together, you’re going to write a book on your adventures, so where this partnership goes. Mark, how do our listeners learn more about Nextworld, and as Erik mentioned that Nextbot platform, what it can do for their business?
Mark Goode (49:40):
Yeah. Yeah. Well, I think, you know, our name itself, you know, we’ve just recently adopted a slogan going to market which is staying ahead of what’s next. So, if you feel like you’re ERP locked, you feel like you don’t have business agility and you want to get on a platform, it’s always going to keep you ahead of what’s next, that’s our value proposition; www.nextworld.net or find us on LinkedIn at Nextworld. So, I look forward to following up and having any conversations. We’ve got a wealth of experience at this company with years of experience of helping people solve business problems and look forward to follow up. And thank you guys for your time today.
Scott Luton (50:23):
You bet. We’ve got the production team dropped the link there, you’re one click away, nextworld.net. So, y’all check that out and find the company as Mark mentioned on LinkedIn. So, big thanks once again, Erik Bush, CEO Demand Driven Technologies, and Mark Goode, President of Nextworld. Thank you both gentlemen. And we look forward to having you back again real soon.
Erik Bush (50:44):
Thanks so much, guys.
Greg White (50:44):
Scott Luton (50:50):
All right, Greg. It’s too much to think about. My 17 pages of notes, I’m going to had a lot of studying to do tonight on this conversation, this partnership, breaking stuff, right? Changing how business is done. But folks help distill this down if you would, especially to folks that may not be, you know, that don’t have your experience or Erik’s experience or Mark’s experience as technologists, even though these days that’s what the supply chain professionals are in many ways. Speak to what folks should really pay attention over the last hour or so.
Greg White (51:23):
Yeah. Well, I always think of a quote you use all the time, which is what got you here ain’t going to get you through it. You don’t say ain’t, but I like to say ain’t. And that is, you know, the old model of ERP and I keep thinking what an appropriate name is Nextworld, right? Because I think we have to understand how rare it is to do what Erik and Mark and the teams of their respective companies are doing in having an incredible amount of knowledge about the history, from once we come of their respective products, but being able to put that in a new future-focused perspective that allows them to use the best parts of their knowledge and their expertise and to issue the old ways of thinking to create a new way of leveraging that knowledge into technology for another age, this Nextworld. And, I just think that’s so, so exceptional. And whenever you find a company like that, you want to latch onto them because they are going to make big changes. And it’s harder to accomplish than you can imagine. We were very conscious of it at my companies in the past, because we had a bunch of, let’s say, experienced practitioners in the company, but they were able to use the best of both worlds. And I think that really bodes well for the success of their customers and their companies going forward.
Scott Luton (52:57):
Love that, Greg. Thank you for sharing. Folks, we’ve also dropped the resources that the Demand Driven Technologies team has brought, that white paper we talked about with DDMRP buffers, and what I thought was a really interesting case study again on Coca-Cola beverages in Africa. So y’all check that out. Who can’t relate to Coca-Cola story, right, especially when it comes from a supply chain perspective? I love that. Folks, make sure you connect with Erik and Mark and Greg. And Greg, your supply chain commentaries hit every Monday, Wednesday, Friday, where you tackle subjects like this and a lot more. Make sure you follow or connect with Greg and participate in those conversations. Okay. Folks, we’ve covered a lot of ground and we couldn’t hit everybody’s comment and questions here today. Be sure to – hey, you know, who I bet would love to take those questions and comments and maybe even map something out on the back of the bar tab? Erik Bush and Mark Goode. We shall see as they break stuff and drive the industry forward with an exciting new partnership.
Scott Luton (53:59):
Thank y’all all for joining us here today. Big thanks to our production team. Thanks to all the folks in the comments. Thanks to Nicole and all of that great facilitation. Folks, whatever you do, it’s about deeds, not words, right? Change is tough as Greg and everyone has been speaking to, but that’s the only way we move forward, right? Taking that action. So, on behalf of our entire team here, Scott Luton signing off for now, challenging you to do good, to give forward and to be the change that’s needed. And we’ll see next time right back here at Supply Chain Now. Thanks, everybody.
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