With roots in serving the manufacturing and wholesale distribution sector, Microsoft Dynamics AX partner Adaptable Solutions is finding new opportunities on the path to becoming a multifaceted ERP provider.
Duncan Cox and Greg Nikoloff, who previously worked for ERP giant Fact, later bought by Geac, founded the company as Open for Business in 2000.
Plans to focus on e-commerce were thwarted by the dot com crash, so Cox and Nikoloff sought a modern ERP product as the basis for a new direction. They selected Microsoft’s suite including Dynamics AX (which was Axapta) and Dynamics Nav (which was Navision).
Adaptable Solutions’ growth is now centred on offering extensions to AX, which it either remarkets or develops locally.
“One of the reasons we liked the Exacta [now Dynamics AX] product originally was that Navision had a very open way of dealing with resellers, and wanted to help them do some things around the product,” says Cox.
“Microsoft has followed that and given us massive distribution channels if we ever want to develop software ourselves. Having distribution channels is like gold, we just have to develop software and support it.”
The company has now developed a sales forecasting module for AX and has signed a reseller for the product in Italy.
“It’s exciting for the market here, people love seeing us develop our own software and exporting it,” says Cox.
Midway through 2008 Adaptable Solutions also won certification to offer a third party solution for the process industry, developed in the US by Fullscope.
He is excited by the prospects to increase the company’s local business in the wood processing and food and beverage sectors with this offering.
For companies in these industries, Adaptable Solutions will be able to bring to bear its skills in large, complex implementations.
“We tend to gravitate, because of our business consultants, to larger customers in manufacturing and high volume distribution. Our grounding was in manufacturing, which by definition has complexities,” says Cox. He and Nikoloff gained this experience when working at Fact and Geac, where they focused on manufacturing and the mid-market.
Such complexity is also inherent in process industries, says Cox, along with its key target market of plastics manufacturers.
“The plastics industry is all about scheduling machines to ensure continuous production, but a lot of ERP systems don’t have scheduling functionality.
“It’s easier to implement a system for basic financials and distribution, but once you start going to other areas like high volume warehousing, scheduling and production, batch traceability, by-products and co-products, it’s more complex.”
Adaptable Solutions now has 12 staff, most of whom work from its office in the Auckland suburb of Newmarket. Two are housed in its Christchurch office, which was opened two years ago to act as a hub for the South Island.
The company has about 20 customers, with about 98 percent of its business done locally, says Cox.
An office was established in Singapore in late 2005, but it was closed to ensure the future of the New Zealand business, he says.
“We picked up a customer that had failed in an AX implementation and we did the implementation for them in seven countries. The customer was very happy, but we found that customers here had the impression we were more focused on Singapore than we were in New Zealand.
“That was pretty dangerous because we could lose customers. We pulled back because the business here had to grow.”
Cox says the company preferred to invest locally than in the competitive Asian market, where big brand names are dominant.
Last year, it won the local Microsoft ERP Solution of the Year award for an implementation for Auckland-based Bailey Tanks, a manufacturer of plastic tanks.
The company needed to capitalise on growth opportunities presented by a drought in Queensland three years ago, but didn’t have a fully integrated planning system. Adaptable Solutions provided scheduling software for Bailey Tanks’ trucks, to ensure orders were filled.
Cox says the market for this software could extend overseas, where there are more companies that need to own trucks to transport large products.
Adaptable Solutions has defied the recession with 44 percent revenue growth for the financial year ending March, he says, up from single digital growth the previous year.
Cox attributes this to the replacement of ERP systems that are in some cases are up to 15 years old.