The world of cloud-based ERP got a rumble today when Rootstock acquired competitor Kenandy. The Support Group is a MANMAN-ERP service firm that's got a Kenandy migration in its resume by this year, after moving Disston Tools off MANMAN and onto Kenandy. Support Group president Terry Floyd said the combination of the two leading cloud ERP companies looks like good news for the market.
"They're scaling up to get new business," he said, after sending us the tip about the connection of the firms. He compared the acquisition to the period in the 1990s when Computer Associates absorbed ASK Computer and MANMAN.
"After CA bought MANMAN, they kept on putting out releases and putting money into the company," Floyd said. "Salesforce must be behind this acquisition in some way."
Kenandy and Rootstock's software is built upon Salesforce and its Force platform and toolsets. A thorough article on the Diginomica website says that the deal was a result of a set of opportunities around a mega-deal and a key leader for a new unit at Kenandy. The plans to combine forces for the vendors include keeping development in play for both Rootstock and Kenandy products.
The Diginomica reporting by Brian Sommer says that Kenandy has a significant number of software engineers and a strong financial executive. "It's the talent [at Kenandy] that makes the deal fortuitous," Sommer wrote, "as Rootstock was ramping up for a lot expensive and time-consuming recruiting activity." Rootsource, by taking on the vendor with a product that's replaced a 3000 at a discrete manufacturer, "is of more consequence to Salesforce."
Vendors like the Support Group seem likely to benefit from the acquisition. By Sommer's reckoning, Salesforce might not have known which vendor among its network of ERP partners to call for manufacturing prospects. "Now one call will [send] the right response and product onto the prospect."
ERP mergers don't always have this level of synergy. When Oracle bought JD Edwards/Peoplesoft, there was friction and disconnect between the organizations. Floyd said that as a result of the Kenandy acquisition, "There may be new business for us." Companies like the Support Group supply the front-line experience to migrate 3000 manufacturers to a cloud platform.
“When it comes to cloud ERP implementations, customer success is often determined by how you implement, not just what you implement,” said Garrehy. “Our combined company is dedicated to making the transition from legacy ERP easier for our customers. We welcome Kenandy customers into the Rootstock fold.”