Baan battling back

ROME - In its ongoing effort to reclaim prominence in the e-business software market, Baan is introducing new products that will help customers squeeze inefficiencies out of their manufacturing processes.

Baan will unveil its new software lineup at its inForum user conference this week, which is expected to draw about 1,500 attendees, according to show organizers. On tap is the launch of Baan's retooled supply-chain management (SCM) suite, plus a preview of its forthcoming product life cycle management (PLM) suite, scheduled to be launched in June.

Once considered in the same league with top enterprise resource planning (ERP) vendors SAP, PeopleSoft and Oracle, Baan lost its momentum in 1999. After pulling in sales of $176 million in the first quarter of 1999, Baan saw its revenue fall to less than $80 million in the second quarter of 2000. Two CEOs came and left between July 1998 and January 2000, before British software maker Invensys acquired Baan in May 2000.

However, lately Baan has been trying to claw its way back. After eight consecutive unprofitable quarters, the company returned to profitability in the fourth quarter of 2000. Last year the company announced its iBaan family of Internet-based software, and this year it will build up its iBaan offerings for customers in six core industries: aerospace and defense; automotive; industrial machinery and equipment; electronics; logistics; and hybrid manufacturing.

Baan's emphasis on developing e-business software for manufacturers just might save the company, experts say. Baan continues to grow and retain a loyal customer base that craves its expertise in discrete manufacturing, says Katherine Jones, managing director at Aberdeen Group. "They do that probably better than anybody."

Also enabling a comeback is that Laurens van der Tang, Baan's president since August 2000, kept his development group intact throughout Baan's corporate turmoil, Jones says. The group stayed together and continued to advance Baan's products. "They weren't asleep at the wheel, they were really just low profile," Jones says.

In time for the inForum conference, this development team pulled together two new product suites as well as hooks to third-party software suites. The new iBaan for PLM is entirely Web-based, and iBaan for SCM is a hybrid of client/server and Web-based modules.

Moving its applications to an Internet-based infrastructure is key to the company's strategy, but Baan lags behind its ERP competition in this area. SAP, PeopleSoft and Oracle already have shifted their applications from the client/server to the Web-based world. "If Baan is going to be a Tier-1 competitor, it needs to keep pace with what Tier-1 vendors are doing," says Kelly Spang, senior analyst at Current Analysis.

Leading up to the show, Baan delivered its new customer relationship management suite, iBaan for CRM. Early on, Baan was among the first ERP vendors to try to expand into CRM, buying CRM company Aurum in 1997. It was a visionary move, but Baan never did much with Aurum and fell behind other ERP vendors in its CRM execution, Spang says. "Organizational confusion cost Baan about a year in its CRM strategy," she says.

With iBaan for CRM, which was announced in January, Baan is trying to invigorate its CRM business. So far, Baan has the pieces but lacks the breadth of functions top-tier CRM vendors such as Siebel Systems and PeopleSoft have across sales, marketing and service, Spang says.