Event Report: Insights Into The New NetSuite At SuiteWorld 2015

SuiteWorld Comes Of Disruptive Age

NetSuite SuiteWorld 2015
Over 7,500 attendees convened at the San Jose McEnery Convention center for the 5th annual NetSuite SuiteWorld.   The four day event brought together customers, partners, and influencers among the ecosystem.  As one of the original cloud pioneers, the appropriate event theme focused on the impact of disruption.   Taking its own advice into account, newly appointed CMO, Fred Studer, has already begun his internal disruption with a re-energized and revitalized brand apparent throughout the event.   Analysis of the major announcements include:

  • Striking up a cloud alliance with Microsoft. NetSuite CEO, Zach Nelson announced on Day 1 immediate support for Azure Active Directory for single sign-on, future Office 365 integration, and late 2015 Azure integration.  The alliance expects to deliver increasing collaboration across additional mobile and cloud solutions.  In Zach's keynote, attendees were also greeted with a passionate and enthusiastic Satya Nadella announcing the partnership via video.

    Point of View (POV):
    After years of bashing Microsoft as the evil empire, the change in tact to partner with Microsoft comes as a mild surprise to many customers and partners.  However, over the past 12 months, CEO Satya Nadella has successfully positioned Microsoft as the neutral cloud platform and infrastructure partner with big announcements that include IBM, Salesforce, Oracle, and SAP.  Concurrently, the arrival of former Micrsosoft executive Fred Studer also provided the NetSuite team with a better understanding of Microsoft's longer term strategy.  Customers will benefit from the immediate single sign-on (SSO) integration of NetSuite and Azure Active Directory.  Over the next quarter, the real meat comes when Office 365 and NetSuite integrate at the process level and users take advantage of in process and native PowerBI capabilities.  The bigger move will come when NetSuite migrates off of AWS and onto Azure for Infrastructure as a service (IaaS) capabilities.  Customers indirectly benefit with lower cost structures.  Finally, the looming threat of Amazon Web Services (AWS) as a competitor and AWS' lack of enterprise class and object level security makes this a smart long-term move.
  • Launching SuiteCommerce InStore.  The new SuiteCommerce InStore solution brings together both the online and in store customer journey.  Early adopters include customers such as Wrigleyville Sports, Noerr Programs, and Lovesac.  Featured in both the Day 1 and Day 2 keynotes, SuiteCommerce InStore includes a full POS with reporting, complete customer profiles regardless of channels, end to end order management, and ubiquitous buyer journey management.

    Despite the annoying nomenclature of omni-channel and omni-business, the concept is sound. Customers seek solutions that are channel agnostic and deliver continuity of experience.  In speaking with the early adopters, Constellation sees early benefits with an integrated suite where sales associates can perform item look ups, including inventory availability across the entire enterprise, assess customer history, complete payments, and print customer receipts.  While the integration of POS may hamper future third party POS partnerships, customers will gain from the tighter coupling of channels and process.
  • Showcasing large enterprise deployments.  Unlike previous SuiteWorlds, NetSuite was unabashed at touting the large enterprise wins.  New customers include American Express Global Business Travel, Billabong, Dominos through Capgemini, Elite Model Management, HP, Naturale Labs, and TGIFridays.

    Over the past three years, Constellation has seen a growing number of SAP and Oracle ERP replacements with NetSuite.  The HP Enterprise divestiture and SAP replacement is indicative of a trend in the market to replace legacy on-premises ERP with proven cloud based ERP solutions.  Of note, the American Express Global Business Travel deal will also bring group purchasing travel discounts throughout the entire NetSuite Customer ecosystem.
  • Delivering NetSuite for Android.  Announced by NetSuite Founder and Chief Technology Officer Evan Goldberg at the Day 2 keynote, the solution delivers the first end to end cloud business management suite for Android.  Customers gain a full mobile first experience of NetSuite's unified ERP, CRM and ecommerce functionality.  The solution builds upon the original solution announced December 2014 for ERP.  Customers can download the solution for free from Google Play at the end of May 2015.

    NetSuite has made a strategic calculation to add support for the mobile OS with the largest market share, following on their earlier support for Apple iOS, which is overwhelmingly dominant in the Global 2000.  Constellation believes this is a smart move as global small to mid-size enterprises are mostly supporting Android and Windows Phone.  However, the key struggle with Android has been the complicated support requirements that vendors have to manage among the device, flavor, and carrier combinations.
  • Providing new procure to pay capabilities.  During Evan Goldberg's demo, the CTO and Founder showed the integration of procurement to finance via dashboards and forecasting.  Built from the SuiteCommerce product, the new procure to pay portal supports blanket purchase ordering, self service vendor capabilities, global vendor management, procurement dashboards, and customizable workflows.

    NetSuite's goal is to deliver a commerce like experience to procurement.  Constellation polled a number of CFO's and office of finance staff whom showed their excitement for the solution.  Most customers have had to deal with disparate solutions and the integration required to enable analytics and forecasting.  Despite an initial release, customers will benefit from the planned road map of additional spend management and vendor management capabilities.

Figure 1. The FlickrStream From SuiteWorld 2015

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The Bottom Line: NetSuite Appeals To Five Types Of Buyers

From vendor selection inquiries, projects, conversations at SuiteWorld, and contract negotiations, Constellation sees customers attracted to NetSuite's value proposition for five distinct entry points:

  1. Classic SMB's seeking a suite based solution.  NetsSuite's initial base came from the SMB market.   These customers sought one integrated ERP and CRM solution.  These customers expect NetSuite to keeping adding functionality such as procure to pay to the core product.  Over the past three years, Constellation has seen a move up market who seek native cloud suite based solutions.
  2. IPO bound organizations expecting perfection. Often driven by the CFO's and investors, NetSuite built a reputation as the product to go public on.  Now beyond technology start ups, advisors often counsel rapidly growing organizations aspiring to go public to go with NetSuite.
  3. Legacy ERP organizations taking a Two-tier approach to innovation.  Large organizations lethargically latched to legacy ERP systems often seek a different approach to modernize subsidiaries.  The two-tier approach enables subsidiaries to innovate at their own pace and tie back to legacy core financials.
  4. Organizations making the move to modernize and consolidate on the cloud.  Organizations ready to ditch legacy on-premises use NetSuite for their cloud modernization efforts. The goal is to replace legacy systems and consolidate as much functionality onto one suite.
  5. Industry specific use cases pulling on one NetSuite module.  Professional services automation, commerce and retail, wholesale distribution, and manufacturing industries often choose NetSuite for the point solution and then grow into the suite.

Your POV

Can you see yourself switching to NetSuite? If you are a NetSuite customer, what do you think of the product and strategy?  Add your comments to the blog or reach me via email: R (at) ConstellationR (dot) com or R (at) SoftwareInsider (dot) org.

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