American Software's Net plan

Enterprise software stalwart American Software is finally hopping on the Internet train.

The Atlanta-based company unveiled this week its Internet strategy, which is based on the development of e-commerce software for the maintenance, repair, and operating market.

American is hoping to take advantage of the burgeoning market of businesses trading with each other across the Internet. According to the Gartner Group in Stamford, Connecticut, what is today a $15 billion market is expected to top $175 billion by 2000.

"We've long recognized the power of the Internet to change the way businesses do business," said James Edenfield, president and chief executive of American Software. "Our electronic commerce strategy allows companies to easily take advantage of the Internet without requiring major changes in existing applications."

American is calling its Internet product suite ECON for electronic commerce over the Net. It is to cover such areas as purchasing, requisitions, accounts payable, field service work order processing, and catalog management. It is also to integrate with American's enterprise resource planning software system which handles financial and manufacturing management systems.

Vinnie Mirchandani, an analyst at Gartner, said entering the e-commerce market with procurement and internal requisitioning applications is a no brainer for vendors and their clients.

"This is a relatively low risk choice," Mirchandani said. "The typical Internet enterprise application tends to be a human resource self-service application. But as more external use of the Internet comes about, this is a safe area for companies to venture [into]."

Mirchandani also warned that these types of systems should not be looked at as the cure all for procurement headaches because much of the back office processes do not change.

"In most companies the back end steps remain the same," he said. "The real opportunity comes when companies let users go straight from the online requisitioning catalog to ordering from the outside world. The majority of companies are not ready for that. I'm a little careful when terms like operation resource management are bandied about because what this really is, is Internet requisitioning."

Besides linking to its own system, American is also building application programming interfaces that will allow the Internet-based software to link to other ERP systems like from SAP, Oracle, or Baan.

But such companies will also be American's competitors in the space. SAP, for one, announced last month its plans to develop e-commerce software for the procurement market and most of the vendors are looking to the Internet as the foundation for supply chain management systems. SAP even made an equity investment in CommerceOne, a provider of online ordering catalogs.