- [Jessica] Hi, and thanks for joining us
for another Q and A Friday,
a regular series where we chat about
issues facing manufacturing companies
in the new world of industry 4.0.
I'm Jessica Vodden, a team member
here at Mountain Point, and I'm joined by
Tom Brennan, CMO of one of our partners,
Rootstock.
Tom has 30 years of professional experience
working at ERP, and for business software companies,
and he's been a long time evangelist
of file computing, and has held many executive rolls,
including several years as a senior vice president
of marketing at Financial Force.
We're so excited to have him with us
as a guest on the show today.
Hey Tom!
- [Tom] Hey Jessica, how are you?
Thanks for having me here today.
- [Jessica] Yeah, I'm great.
Thank you for joining us.
So, Tom, we often talk about the Salesforce
platform on the series,
but I think many people still think of
Salesforce as predominately a CRM system,
and they're often surprised to learn
that over the past 20 years or so,
Salesforce has really evolved
into a robust enterprise platform,
capable of
unifying many aspects
of the business.
So we invited you on the show today
to talk about how we can integrate
or migrate ERP data in the Salesforce
to have a really comprehensive view of the company.
But before we dive into that,
can you tell us a little bit about
yourself, and about Rootstock?
- [Tom] Yes, as you said in the intro,
I've been kind of involved with
cloud computing a while,
and the precursors to cloud,
I don't wanna kinda show my age, I guess,
but been real evangelist to the whole idea
of moving computing more to end users
and rather having all the IT burden
that you normally have with managing stocks
and things, but not just that,
but also I think what Salesforce
has done beautifully is put the ability
to change and upgrade and improve apps
in the hands of business users,
so to me, that's an exciting thing,
especially in ERP,
which has traditionally been very IT focused,
in that kinda way.
- [Jessica] Awesome. And so tell me a little
bit about Rootstock.
What do you guys, what problems
do guys try to solve?
- [Tom] Yeah, we're very focused on
manufacturers and distributors,
or anybody who produces product
that makes it, distributes it, or services it.
So, it could be put in other ways,
we're not marketing to services companies,
banks, and real estate firms,
and things like that.
We're building applications that help people
that make, distributor, or service a product,
- very focused on the Salesforce platform.
Our customers range from 50 employee companies
that are emerging/growth type companies,
all the way up to 25,000 seed enterprise companies,
so we fit the gamut, if you will.
- [Jessica] Yeah, absolutely.
Well, as I mentioned earlier,
Rootstock is a partner of Mountain Point,
we love the relationship with them,
we have a lot of trust in what they offer,
and so we're very happy to have you
with us today to talk about one thing
that we also firmly believe,
and that's that ERP really should be on the cloud.
As I mentioned, I think a lot of people
think of Salesforce as a tool for sales and marketing,
and maybe even customer service,
but tell me why
Salesforce is also
a really amazing platform for ERP?
- [Tom] Yeah, I think there's several reasons for that,
and I think part of it is actually the way
the market is driving us,
the way customers are driving us as well.
Traditionally, I brought this diagram
to kinda illustrate this.
You go into any company,
you'll see a white board
with something like this up there,
and then you usually are going to see
a bunch of dotted lines in between
CRM and ERP trying to integrate them,
and really what's happening is
that people are realizing CRM and ERP
shouldn't be separate.
There's processes that the order to cash,
or opportunity to cash process,
for instance,
goes across there.
More and more people want to know more
about their customers,
and get 360 degree views of what's going on
with their customers,
so that's an issue.
If you're in management, you wanna know
what's happening with costs,
but also what's happening with sales.
So you wanna be able to walk in
in the morning, look at a dashboard,
and see your whole business,
not just what's in CRM,
and not just what's in ERP,
but it's those things together.
Traditionally what's happened
is these two things kinda grew up
on their own, and their own track,
so ERP is probably automated first,
or more extensively over the years,
going back even to the '60s,
if you think about that.
Then CRM came on,
and eventually CRM went into the cloud,
it went there first,
and was adopted quite readily,
and ERP lagged, which I think we should
talk about a little bit more here,
but really what it comes down to
is, you'll see I think as we talk more here,
is that the system of engagement
that you see on the left,
and the system of record need to be combined.
Fundamentally, the way business works
today, it can't be.
That's why we think ERP belongs on the platform,
where you can have the system engagement,
and system of record together.
- [Jessica] Yeah, I think that makes a lot of sense,
and I think it's understandable that,
given they were initially separate systems,
and separate processes,
they grew up separately.
But in today's world,
it just seems natural to integrate all of that,
right?
And to have, just as you said,
this complete view of what's happening
with your business.
Particularly, with the changes
that we're seeing in customer expectations,
I think having that insight into sales orders,
having that insight into your production schedule
is really important for being able
to serve your customers in the way that you want.
- [Tom] Yeah, and I think if you look at
each of the boxes on here,
imagine that's a department in your company,
and imagine the customer calls.
It says, 'Hey, can you tell me
what's the status of this invoice?
It doesn't seem right.'
or 'A credit wasn't applied to my account.
Can you tell me what's going on?'
And then depending on who you are,
you may or may not have visibility
of that question.
So what happens is the customer calls
gets bounced around the department,
has to repeat the information,
which we've all been through,
not a lot of fun.
What we're finding is companies
more and more are competing on service,
not just on the product they provide,
but on service.
But if your frontline people
are not equipped with the information
to handle the customers' question,
it's very difficult.
- [Jessica] Yeah, absolutely, absolutely,
and that's a conversation we have a lot
on this show,
is how to make sure you're serving
the customer best.
I think the driving force
behind most digital transformation initiatives
that are successful,
is really that drive to add a better
value for the customer,
and to provide better customer service.
- [Tom] Yeah, you're absolutely right.
- [Jessica] So Tom, tell me,
why do you think that ERP has lagged?
Why hasn't it grown as fast
as most cloud competing systems?
- [Tom] Well, I think when you look at
what's happened in the marketplace,
Salesforce hit the market first,
and concentrated on CRM.
To some extent, I would say CRM's a little easier,
or a fair amount easier to implement
and to automate than ERP is.
ERP can be, in a product company in particular,
can be very complex,
with very deep bill of materials,
and routings and schedules,
and supply chain,
and then pricing variances,
and all that.
It's a pretty complicated area,
where, you know with CRM,
when I first started off,
you could go in and get it on your credit card,
and start entering contacts, and start calling them,
and recording what was going on.
Relatively speaking, CRM,
CRM's obviously grown into a bigger thing as well,
so I don't wanna belittle it,
but,
it was an easier thing to automate,
and that's one reason why,
customers just don't go
'Oh I'm just going to go in
and put in a new ERP system.'
It takes time,
lot of thinking,
a lot of complex processes and stuff
And that's one reason why I think it's lagged,
and certainly,
the other thing that's happened
is Salesforce themselves jumped on this,
as the leader in it,
on cloud in particular,
and the ERP vendors,
the traditionally European vendors,
have been lagging.
Matter of fact,
they've fought it tooth and nail,
it was very public proclamations
by some of the biggest ERP companies
that didn't think cloud was a real deal,
or that important.
Now they all have their religion,
or saying they have their religion.
So they drag their feet,
and when they're talking to these companies,
they were dissuading them from going to the cloud.
Scaring them on security,
there's a term called "cloud washing" out there,
where what we're seeing is
companies will take a traditional product,
throw it on Amazon (AWS) and host it,
and call it cloud.
To a customer,
they see all the marketing,
it's "cloud this, cloud that",
but it's really just the same old thing,
the same old product that's difficult to upgrade,
as I was mentioning earlier on,
difficult to add to,
so that whole upgrade cycle is still the same thing,
it's just,
they may have solved part of the IT problem
in terms of hosting servers and stuff,
but the real value,
and ability to rapidly innovate and change
is not there.
I think it's really those two things,
it is harder,
and secondly, the industry has not
kept up with the paces as Salesforce did
on CRM.
That's different now,
because companies like Rootstock,
we now have ERP on the Salesforce platform.
So our functionality is now equivalent or better than
the old legacy systems that are out there.
A few years ago that wasn't the case.
So you can see why a lot of folks
didn't jump into it.
But really the time is to move to cloud now,
because there's lots of alternatives
and ways they can do that.
- [Jessica] So tell me what options they have.
You said there's a lot of alternatives,
a lot of strategies.
Can you give me some examples?
If I'm a CEO and I'm sold,
I wanna upgrade my system,
where do I start?
- [Tom] Yeah, yeah.
So there's really,
I would classify them if you want to call it,
"crawl, walk, run".
The first one is what we'll call crawl.
A lot of people, they're not ready to rip
and replace their old systems,
change all their processes,
retrain their people,
that type of thing.
But they do want the visibility of ERP information,
and they wanna provide it in a platform,
the system's engagement.
They wanna have it available on mobile phones,
they wanna have it available in communities,
and pushing it out customer's
and supply chain people.
One of the things they'll try to do
is move data from a legacy system,
and try to move it on to the cloud.
We were seeing this out there in the marketplace,
and so we decided to build a product
that we just announced,
called the ERP Data Framework,
to help people do this.
This just allows them to move data,
not much else, really,
on to the Salesforce platform.
What we did is,
we are delivering, basically,
ERP objects / Salesforce objects,
with things that people know and love in ERP,
like inventory objects,
and sales orders,
and bill materials,
and things like that,
financials, invoices,
providing that as a shell,
with a bunch, all the fields
that you would imagine in a typical ERP system.
You can implement that,
instead of going out and designing a bunch
or custom objects
that count against your licensing,
as well.
These are just right out of the app exchange,
objects that you can use instantly,
so you don't have to go through the process
of going,
'Okay, I've got an inventory object,
I need these fields,'
or 'an invoice object, I need these fields put in.'
It's all done for you.
So what you're able to do then is
put the objects
on our framework,
then you use the integration tool of your choice.
We happen to be starting with MuleSoft,
in one of the things that we're doing right now.
But use MuleSoft to map data from Legacy ERP systems
on the right,
say an SAP API,
using the MuleSoft connectors,
and map them through our API into our connector.
Moving data from one place to another
is just a mapping exercise now.
It's not slowed down by oop, you know
"I got MuleSoft, and that's great,
and I got my connectors to SAP and that's great,"
but where am I gonna put it in CRM?
This kinda kick starts that,
and gets you off to getting the data
in CRM much faster.
Once you get the data there,
then you get the 360 degree view of the customer,
you can take, say Dashboards,
or Einstein and run it across
CRM and ERP data,
it becomes much more powerful.
It's a baby step,
but a good and powerful one to get started,
unlocking what's in these old ERP systems.
- [Jessica] Yeah, wonderful.
- [Tom] That's the first,
I call that the crawl method,
if you wanna categorize it as that.
- [Jessica] Sure. So what if I want to walk?
What does that look like?
- [Tom] You wanna walk?
So the next thing is,
you might choose some processes
that you want to move to the cloud.
Again, you're not ready to do everything,
but there's some things that you may want to do.
A good example that we see a lot of now
is in Field Service.
The Field Service Lightning
product is
becoming very popular product based companies
on the platform.
So you'll have a technician
that's got inventory in their cars,
or their vans,
and then they may have a depo-repair place,
then you've gotta deal with that
in terms of returns,
and then getting resupplies,
and that type of thing.
Field Service does have an inventory capability,
but it doesn't have the full supply chain capability
of tracking all those things in a very detailed kind of way.
So we work with that,
and provide, we have customers who implement
our inventory system,
then they're able to track it,
and then actually handle all
the supply chain fulfillment pieces
when they need new parts.
Also if they want to add, say,
an RMA (Return Merchandise Authorization) process,
the return comes in,
it comes into the inventory,
it can go through re-manufacturing
or refirb reprocess.
And that's sort of like a mini manufacturing process.
Then back in to finished, available inventory,
that's available too.
It's one way to take one piece of the process
and run it on a platform without doing the whole thing.
There's another permutation to this,
this is by process,
in the other incremental way,
a lot of companies do,
and by the way,
these are both called Two Tier ERP,
is you may have a business unit
that's sort of self contained,
and you may have a parent company
that's got SAP or Oracle, or something like that,
and you get this new business unit that's real,
you wanna keep it light on its feet and agile,
and whatever it is doing may not fit
the corporate system very well.
It's a real limitation to that business unit.
What you then can do is run
Rootstock Cloud ERP in the smaller business units,
they don't have to be smaller,
but maybe just different that you want to handle them,
alongside Salesforce CRM,
the service cloud and sales cloud,
and then feed, say,
a trial balance,
or financial information,
periodically to the corporate system.
It's sort of an arms length,
run in a way that they can get the data
in to corporate for consolidations and such.
That's kinda walking.
It can be pretty advanced for some companies,
as well.
- [Jessica] Yeah, that seems to offer
just a lot of flexibility.
- [Tom] Yeah, sure, we love customers to put
all our product in,
but we understand.
Business is happening,
a lot of things happening in terms
of corporate priorities.
We wanted to offer a way for them to get into it,
in different ways that matched their needs.
Then there are times,
we have a lot of customers now that are
starting with these incremental approaches,
with the view to eventually move it all to the cloud,
which is really the next one.
Which is, you know, you're running,
if you look on the left there,
the top left,
you've got the sales cloud placing everything
from sales orders,
engineering,
your whole supply chain,
building an inventory,
ship it out,
do logistics,
account for it,
all on the platform,
and then on the back end of it,
wrapping and service,
the whole RMA process,
as an example,
and call center on it.
Literally end to end,
you can run an entire manufacturing business
on the Salesforce platform,
with Salesforce CRM,
sales cloud/service cloud,
and Rootstock ERP in the middle.
The great thing is,
if they've got Salesforce in already,
they have folks who know how
to administer users,
know how to write reports in Dashboards,
write workflows,
use chatter,
know how mobile works,
communities.
All that's available to us instantly,
and that was one of the beauties for us
in choosing the platform,
is we didn't have to build all that,
and it's already there.
It's part of the platform,
so we inherit that,
in essence, and so do our customers.
They don't have to have another staff for that.
If you look at ERP
and that old Legacy thing,
even if it's hosted,
there's still another stack to deal with.
Maybe not at the maintenance level
of the updating the operating systems,
and such like that.
Maybe not there,
but there's still a stack of tools
that have to be fitted into that system
that have to be managed and maintained.
This is all just,
as everybody knows whose on Salesforce,
it all just kind of comes with the system
when you use it.
So that's that, that's kind of the beauty,
and this is the extent, so somebody can go.
Like I said,
crawl, just get the data there,
move some processes or business unit,
or they can do the entire thing
all here on the Salesforce platform.
- [Jessica] Yeah, I think that's really exciting,
and I think it opens up a lot of questions.
We may have to have you back on the show,
because I have a lot of follow up questions
that we just don't have time for today.
We may have to pull you on again.
Before we sign off,
what's the best way for listeners
to learn more about both cloud ERP and Rootstock?
- [Tom] Whell you can go to rootstock.com,
there's certainly lots to read there,
but I would point you to our resource center,
there's a number of independent white papers
that we've purchased the rights to,
for you to read about,
say the difference between hosted and cloud ERP.
There's a number of things
talking about the Salesforce platform,
and it's used for ERP there as well.
If you've got people that are trying to understand
the differences, or just getting to know cloud ERP,
and hopefully the audience doesn't take offense
to the title,
but we wrote a book with a writer,
called "Cloud ERP for Dummies"
to give people the basics of it
and where the differences are.
We felt it was really important,
because as I said earlier,
manufacturers have been cloud washed
by a lot of these older vendors,
so they're confused
as to what a real
multi tented cloud is,
and what it's all about,
so we try to shine a light on that,
and that's what's in that Dummies book,
as well.
- [Jessica] Yeah. I love that title.
I've always wanted to say,
'Okay, simplify it. Okay, simplify it more.'
- [Tom] Yeah.
- [Jessica] I think that we're all overwhelmed
with information all the time,
so the more succinctly and directly you can say things,
the better.
- [Tom] Yeah, I own a photography one,
and a couple others as well,
so I need it simplified.
- [Jessica] Well thanks again for chatting
with me today,
it's been really fascinating,
and hopefully we can have you on again.
For those of you listening,
if you have a question about the show,
or a question that you'd like
for us to answer in the future,
please hit us up on our social media channels,
you can fill out the comments section
on our website,
email us, call us,
we're available pretty much everywhere.
Thanks again, Tom
and happy Friday!
- [Tom] Same to you Jessica,
and thanks for having me.