Last week, around 10,000 customers, partners, analysts and employees descended on Las Vegas for NetSuite’s SuiteWorld conference.
This was the first SuiteWorld since Oracle’s acquisition of NetSuite. All eyes were on the conference to see how the tone might have changed as NetSuite entered the mothership. As previous SuiteWorld’s have all taken place in the Bay Area, this was also the first time the event was held in Las Vegas. Former CEO Zach Nelson's departure from the company added to the already high levels of interest in the event.
Day one kicked off with a guest visit from Oracle’s co-CEO Mark Hurd. He spoke casually and informatively for a good half hour to inform attendees about what Oracle’s intentions are for NetSuite. To sum it up simply -- Oracle wants to provide NetSuite with as much fuel as it needs to grow, but promised to leave it alone and let NetSuite “do its thing.” Hurd was quick to try and dispel any preconception that Oracle would, as has traditional been seen as its modus operandi, run roughshod over NetSuite’s culture and start to extract as much value out of the asset in as short a space of time as possible.
Hurd answered some questions from the audience (admittedly a couple were softball ones from NetSuite employees) and didn’t miss the opportunity to take a dig at competitors. He was quick to critique SAP and its (in his view) failing strategy around HANA. He also channeled his boss and Oracle founder Larry Ellison and reiterated that Oracle is the biggest cloud computing vendors on Earth -- an assertion that raised many eyebrows in the audience, especially from those people who watch vendors such as AWS.
Of course, as was always the case, it came down to definition. It was fair to assert that when it came to the full spectrum (infrastructure, enterprise applications, development platforms), there was some validity in Hurd’s claim.
So for a quick wrap up of what NetSuite announced (or, the stuff that I consider important) at the event…
Global expansion
Mark Hurd’s talk could be summed up in three words (or, more correctly, one word repeated three times): he promised NetSuite will deliver “more, more, more.” Oracle is doubling down on its investment in NetSuite and helping it to scale its business both within existing markets and into new ones. NetSuite will leverage Oracle’s huge data center footprint to roll out more zones quickly alongside wresting Oracle’s global offices to gain more “on the ground” exposure. And this isn’t a short-term commitment -- Hurd couldn't have said it any clearer, promising that NetSuite will be a standalone entity and given the freedom to operate “forever.”
To which the obvious question is one of upsell -- does Oracle see NetSuite as a gateway drug to the more expensive and expansive Oracle products? Hurd and McGeever both said no way, with McGeever stating clearly that “there will be no upsell of customers.”
Of course, there are edge cases -- at the show, NetSuite announced visualizations and forecasting features powered by Oracle products. There were a few ecosystem players who might have been a little uncomfortable with that, but balancing product direction with ecosystem sensitivities is something that all platform vendors need to do.
In terms of the areas in which Oracle is enabling NetSuite to invest heavily, the company spelled it out clearly. From the release:
Data Centers. Oracle NetSuite Global Business Unit plans to more than double its data center footprint from five data centers globally to 11. NetSuite currently operates five data centers, three in North America, one in Amsterdam, Netherlands and one in Dublin, Ireland. NetSuite expects to add a fourth North American data center in Chicago. As part of the global expansion plans, NetSuite will leverage existing Oracle data centers in Europe and Asia. In Europe, NetSuite is scheduled to open a data center in Frankfurt, Germany to remedy the lack of modern cloud computing offerings in the country. In Asia Pacific, NetSuite plans to initially launch facilities in Australia and Singapore, followed by Japan and China.
Field offices. NetSuite expects to double its global presence, expanding from offices in 10 countries to 23 spread across the globe. The addition of Oracle’s field offices significantly increases NetSuite’s ability to meet the rising demand for cloud ERP around the world. NetSuite is establishing a new presence in Argentina, Brazil, Colombia, Chile, Mexico, France, Germany, Sweden, Dubai, China, India, Malaysia and New Zealand. In addition, NetSuite is expanding headcount in existing field offices by over 50 percent to provide better resources for customer demand.
Development centers. Oracle NetSuite Global Business Unit is leveraging existing Oracle development centers across India, China and Japan. The development centers will be able to accelerate the development of international, regional and local features and functionality within NetSuite OneWorld.
SuiteSuccess
Key to NetSuite’s continued growth is finding ways to scale its business without massive costs. Along with this goes a need to ensure customers are appropriately selected, given the right information and that their deployment goes well. NetSuite currently runs a dual sales strategy, leveraging both direct and channel sales -- and in non-core markets, there has been some issues historically with partners dropping the ball.
SuiteSuccess is designed to resolve these issues -- both for direct and channel sales. SuiteSuccess is a specific NetSuite IP that codifies their experience implementing and customizing NetSuite for different verticals. SuiteSuccess is both a series of product customizations, a new way of engaging with customers and a cultural shift in the organization. SuiteSuccess is also the embodiment of NetSuite’s desire to move away from “creating cloud versions of SAP.” Instead of matching functionality with existing solutions, SuiteSuccess seeks to apply best practices to customers.
And while one would be forgiven for thinking that customers will remain adamant that their particular use case and operating model is unique, their ERP also needs to be. Jim McGeever, NetSuite’s head honcho, told me customers respond well to SuiteSuccess, preferring to take advantage of the newly exposed best practice and happy to have a trusted partner tell them the right way to do things. SuiteSuccess has over 300 customers and is available now, expanding globally into more industries and to current NetSuite customers over the course of this year.
I have questions regarding how NetSuite will scale SuiteSuccess, especially given their international ambitions. In some regions the channel is already the main barrier to increased growth. While one could assume SuiteSuccess will do much to help poorly-performing channel partners do a better job, time will tell if this comes to pass. McGeever pointed out that in cases where the SuiteSuccess approach had been utilized, NetSuite was 59% more likely to win the deal. He also admitted that, internally, SuiteSuccess was the hardest culture change ever to implement -- requiring training and retraining. Time will tell how that goes within the context of a channel over which the company has less control.
SuitePeople
A creation of the team (if not the tech) acquired a couple of years ago from TribeHR, SuitePeople is NetSuite’s foray into the human resources (HR) space. Built natively on top of NetSuite, and only offered to customers who are also using core NetSuite financials, SuitePeople aims to tick off the core HR requirements entirely within the core financial app.
As I said, SuitePeople isn’t designed to be a complete HCM solution -- it doesn’t offer payroll outside of the U.S., for example -- but rather aims to include people's data throughout the financial suite. SuitePeople helps enable employees to request time off, access employee directories and organizational charts, monitor upcoming vacation schedules and new hires, or publicly recognize good work.
Still very much a lightweight solution, NetSuite informed the audience that with SuitePeople it plans to provide:
- Core HR capabilities: Native organization design, job and position management, workflows and compliance management, all powered by effective-dated employee master data, providing HR with the systems they need to run a best-in-class operation.
- HR analytics: With pre-built reports and dashboards focused on key people metrics and compliance, including a new chief people officer dashboard.
- Employee engagement: Kudos aids all employees to recognize those co-workers who have helped drive the business forward -- vital in today's world of distributed workforces.
- HR compliance: Built in human resources reports, searches and notifications are paired with tailored compliance features to ensure regulatory requirements are easily met and filing deadlines aren't missed.
When asked about the potential clash with Oracle’s own HCM system, McGeever was very clear: “Oracle is killing it in HCM. SuitePeople is core HR, and most people that are using SuitePeople are coming off spreadsheets.”
MyPOV
Hurd is wrong when he says nothing has changed. Clearly, a huge amount has changed both internally and externally at NetSuite. That said, I was expecting to go into SuiteWorld and essentially see a lighter version of Oracle's Open World. That wasn’t the case -- while the culture has certainly changed, SuiteWorld didn’t feel like a complete departure from the days of old. A bit of a departure, but not a complete one.
In terms of their growth prospects -- both SuiteSuccess and the investment in resource and infrastructure will position NetSuite to grow very well in the years ahead -- the Oracle ownership is a real “unblocker” and allows NetSuite to do what it knew it had to do, but didn’t have the resource base upon which to execute.
Post-SuiteWorld, I’m bullish about the future, and cautiously optimistic that NetSuite won’t become an evil empire itself because of it. Proof of the pudding will be whether I get invited back to SuiteWorld in 12 months time!