open source enterprise resource planning and order management system for eastern european tool and...

Open Source Enterprise Resource Planning and Order Management System for Eastern European

Tool and Die Making Workshops

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TOOL-EASTTOOL-EAST

Workshop and networking event“Networked organizations - EU projects results and lessons learnt”

Project overview and results by Ali Imtiaz / Oliver Budde

November 29th-30th, 2007, Bled

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2Ali Imtiaz / 29-30.11.2007 / Bled, Slovenia

Index

Overview

Scope, objectives & inputs

Model description

Product description

Business model

Next steps

Questions

1

2

3

4

5

6

7

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Overview

WP 2: Business Analysis and

Modelling

WP 3: Technology

Infrastructure

WP 4: Open SourceCollaborativeSoftware Development

WP 6: Service Portal Development

WP 8: Disseminationand Exploitation

WP 1: Project Management

Time

SOA: Service Oriented Architecture

WP

7:

Tra

inin

g

WP 5: SOA Based ProcessCustomisation

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Status

Business model is defined!

Business goals for Tool-East: Structure the process of input gathering from

relevant partners and sources Involved relevant partners and gather their

expertise Provide consolidated results Foster decision making in operation and content

related questions.

Business process is being developed.

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Index

1

2

3

4

5

6

7

Overview

Scope, objectives & inputs

Model description

Product description

Business model

Next steps

Questions

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Scope & Objectives

Detailing on the stakeholder of ToolEast

Interaction between the stakeholders

Judgements of their relationships

Structuring the work into marketable products

Detailing the benefits for each product

Details on the approach Details on the impact

Details on Business Model

Stakeholder Analysis

A sustainable business model, as an essential step for building the business plan, was developed

Definition of Products Details on Approach

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Index

3

1

2

4

5

6

7

Overview

Scope & Objectives

Background & Input

Product description

Business model

Next steps

Questions

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Main Stakeholders

Tool & Die Company

Regional ICT Market Place

Developer/OSC T&D Client

ASP T&D Vendors

• IT-Service provider• Based locally• Deep knowledge of

Opensource Technology and ERP

•OpenSource developer distributed around Europe•Communities enhancing the maturity of TE

•Company hosting Tool-East solution•Providing implementation and maintenance service

•Supplier of goods for T&D company•Offering products via the trading platform

•Customer of T&D products•Browsing to the product catalogue online•Initiating an order

•Providing a trading platform for customer and vendors of T&D•Enabling reverse auctioning

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Index

1

2

4

5

6

7

4

3

Overview

Scope & Objectives

Background & Input

Product description

Business model

Next steps

Questions

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Tool-East product concept

Stakeholder

Features

Benefits

T&D;RICT; OSC

• Basic ERP-Functionality• Easy to use and customized for

T&D needs• Build and Run by/with RICT

support

• Open Source with good cost/benefit relation

• Safeguarding further development

T&D;RICT; OSC,ASP

• Hosting of ERP application• Outsourcing of ERP-

development and maintenance

• Reducing fix-cost• Outsourcing of customizing and

maintenance

T&D;RICT; OSC,ASP, Market Place op.

• Trading platform (B2B) – Purchase as well as Selling

• Collaboration platform – Company profiles

• Innovative sales channel• Bundling purchase activities

Standalone

Sales

Purchase

Order

Design

Manu-factoring

Try Out

ShippingProductionplanning

Invoicing

ERP-Hosting

TE-Core TE-Core TE-Core

App

licat

ion

Lay

er

User-Mgnt

QoS

Portal

Security

Market-Place

TE-Core TE-Core

User-Mgnt

QoS

Portal

Security

Custom

er

Trading-Platform

TE-Core TE-Core

User-Mgnt

QoS

Portal

Security

Ven

dor

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Commutative functionalities to user benefits

Customer Benefit

TE-ERP

Standalone

Cum

ula

tive

fun

ctio

nalit

ies

Low

High

High

Low

Tool-East

Market-PlaceTE-ERP

Hosted Solution

Brick by Brick

Basis solution is TE-ERP Standalone

Incremental approach was followed

TE-ERP Hosted Solution provides an increased Customer Benefit by reducing fixed costs

TE-Market Place Solution provides the highest Customer benefit for ensuring the collaboration between the main stakeholders

Details

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Index

1

3

5

6

2

4

7

Overview

Scope & Objectives

Background & Input

Product description

Business model

Next steps

Questions

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Presentation of the Business Model

Overview

Foundation of the Business Model

Cornerstones

Who?

For What? To Whom?

Definition of the stakeholders

Definition of the product and

services

Definition of the customer segments

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Services in context of Tool-East (1/2)

Consulting Regional ICTs (RICT) consult T&D companies for implementing Tool-East. This service includes the support for an ERP-selection process (feasibility), which ideally ends with a decision for Tool-East. Additionally they support the T&D companies during the implementation phase.

Service Description Value Effort

Customization RICTs adapt the Tool-East solution to the specific requirements. This service includes a detailed requirement analysis, design of the to-be solution and the practical implementation.

Maintenance RICTs maintain and optionally run Tool-East on behalf of a T&D company. Maintaining includes customisation (internal configuration), little extensions for providing interfaces or modification.

Training Development and production of training material for the user and developer of Tool-East. This training will include material like detailed Howtos, FAQs and books but also workshop concepts

Survey

resu

lts!

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Services in context of Tool-East (2/2)

Hosting An ASP offers ERP-Hosting based on the Tool-East solution.

Service Description Value Effort

Subscription Different stakeholders in the Tool-East business scenarios can subscribe for the Market-place. T&D-Companies: Getting additional sales channel and bundling demandT&D-Vendors: Getting additional sales channel support for the transactionsT&D-Customer: can initiate a reverse auction, identifying supplier

Value-Added Service E.g service for logistic driven services or advertisements. This aspect is

subject for further investigations, but not critical for the overall business model

Input from: 21 ERP application providers, 15 RICTs (service providers) and over 30 T&Ds in eastern Europe

? ?

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Product #1: Standalone Solution

Tool&Die RICT ASPDeveloper

(OSC)T&D-Client T&D-Vendor

Market-Place

Cash

Consulting

Training

Customization

Maintenance

Cash

Programming

Support

Services

Services

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Product #2: TE-ERP Hosted solution



Market-Place

Cash

ERP-Hosting Training

Consulting Customizing

Services

Development Maintenance

Training Customizing

Development

Support

Services

Cash

Cash

Services

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Product #3: Market Place



Market-Place

Cash

Cash

Cash

Cash

ServicesSales Channel Billing Funct.

Market-PlaceServicesInterface

Sales Channel Purchasing Plt.

Customizing DevelopmentMaintenance

Services

Cash

Development

Services

Services

Cash

Services

Advertisement

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Details on the Approach

Definition of Product configurations2

Consolidating results

Determining revenue per country and service3

4

Definition of Market-Segments1

16%

1-50

22% 51-100

26%

101-250

22%251-500

10%

501-1000

4%

>1001

#1 #2 #3 #4 #5

26% 28%

72%

50%

27%

22%

5%

19% 800.000Germany

13% 10% 400.000Bulgeria

20% 8% 450.000Slovenia

Service #1 Service #2 Service #3 Service #n

0%

50%

100%

2007 Q1/2

2007 Q3/4

2008 Q1/2

2008 Q3/4

Service #1

Service #2

Service #3

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Considered markets

Approximately every 6 years an ERP-Systems is replaced

Every Tool&Die company needs an ERP-system

Relevance of Tool-East is especially high in the SME

Attractiveness for a given segment can be derived from the USP

Germany, Bulgeria, Slovakei and Slovenia were considered first, since those are the pilot markets

Assumptions

Market Share

Definition of Productconfigurations2

Consolidatingresults

Determing revenue per country and service3

4





4


Segments Companies Installation

1-50 495 83

51-100 210 35

101-250 80 13

251-500 16 3

501-1000 5 1

>1001 1 0

Ger

man

y

00>1001

00501-1000

00251-500

18101-250

53051-100

10601-50

InstallationCompaniesSegments

Slo

veni

a

00>1001

00501-1000

00251-500

315101-250

31951-100

5281-50


Bul

geria

00>1001

00501-1000

00251-500

16101-250

54551-100

10801-50


Slo

wak

ai

Source: Statistics for Tool and Die Industry in the considered markets

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0

2

4

6

8

10Project Management

Try-Out

Sales

Material Planing

IntegrationCost

Maturity

Architecture

Support

Unique Selling Proposition

Differentiation potential for outmost in the functional coverage and in the cost

(OpenSource) Maturity is not that relevant for closed-software

Architecture is not a differentiating characteristic

Dimensions are derived from studies and verified in expert interviews

=>Based on the USP the most probable market share of Tool-East could be estimated

Details

USP




4





4


Legend: Closed Software (avg) Open Bravo Tool-East

Source: ERP-Z Zufriedenheitsstudie, Trovarit; TE-Deliverable 3.2; Expert Interviews during the conference EPR-Days in Aachen

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Deriving the product configurations




4





4


Estimation of the effort per segment

3

1 2

4

Per segment the complexity for providing the services is very different

Based on empirical data an average effort per segment was estimated

Based on expert interviews an the empirical data the complexity setting could be adjusted

For an ERP-project the effort can be forecasted by using the adjusted complexity settings

Details

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Determining revenue per country and service

ExampleEfforts in days is identical per country

Daily rates differs from each country and in some cases per segment

According to the analysis from step 2, it exists a logarithmic development in the effort in days

=>Service potential per country and segment can be estimated

Assumptions




4


From Step 2Calculated

revenue per Segment

From Step 1From market

research

Effort in days Daily rate Revenue1-50 5,44 850,00 € 4.624,00 €

51-100 9,32 850,00 € 7.922,00 €101-250 22,00 850,00 € 18.700,00 €251-500 25,55 900,00 € 22.995,00 €

501-1000 30,50 950,00 € 28.975,00 €>1001 40,25 950,00 € 38.237,50 €

SegmentsConsulting

Source: Empirical analysis from more than 100 ERP-projects carried out by FIR and Trovarit

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Revenue

Estimated Revenue per Country for the first year (biased)




4





4


0,00 €

100.000,00 €

200.000,00 €

Germany

Bulgaria

Slowakia

SloveniaGermany 70.388,40 € 154.854,48 € 42.233,04 € 14.077,68 €

Bulgaria 3.486,65 € 7.670,63 € 1.673,59 € 464,89 €

Slowakia 10.690,00 € 23.518,00 € 6.414,00 € 2.138,00 €

Slovenia 11.834,00 € 26.034,80 € 7.100,40 € 2.366,80 €

Consulting Customizatio Maintenance Training

•These figures represent the pessimtisc scenario•Figures do not include calculations for hosting and supportive activities (value added services)

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Results

Business model proves revenue potential

Availability of service provider will be ensured

Opportunities have already been validated

Business model provide solid base on which a Business plan could be build upon

Conclusions




4





4


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Index

1

3

6

2

4

7

Overview

Scope & Objectives

Background & Input

Product description

Business model

Next steps

Questions

6

5

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Summary

Stakeholders and InteractionsThe structure is sustainable and gives enough details about the business model and stakeholder relationships

Benefits There are surely opportunities for local ICT suppliers in customization, implementation, maintenance etc., and these need to be further analysed in the business plan

Roles Clear roles were listed and described in scenarios taking into account the wider ICT and OpenSource community

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Index

1

3

6

2

4

7

Overview

Scope & Objectives

Background & Input

Product description

Business model

Next steps

Questions7

5

open source enterprise resource planning and order management system for eastern european tool and...

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