1. Upgrading to Enterprise Edition The Process, Challenge and Benefits Anton Chilton Senior Vice President – QAD Global Services Midwest User Group

2. 2 How do you feel when you think about your next upgrade?

3. 3 How do you feel when you think about upgrading to Enterprise Edition?

4. 4 Discussion Upgrading to Enterprise Edition Analysis Challenges Value Process & Tools

5. 5 Analysis

6. 6 How often would you like to upgrade? Upgrading to Enterprise Edition - Analysis Source: QAD Customer Survey – Jan 2013

7. 7 Desire vs. Reality Upgrading to Enterprise Edition - Analysis 80% 45% Customers who desire to upgrade within a maximum 6 year cycle Customers who achieve an upgrade within a maximum 6 year cycle

8. 8 35% of customers are not hitting their upgrade target!

9. 9 What are your upgrade plans? Upgrading to Enterprise Edition - Analysis Source: QAD Customer Survey – Jan 2013

10. 10 35% of customers have no firm plans for an upgrade

11. 11 What are the barriers to upgrading? Upgrading to Enterprise Edition - Analysis Source: QAD Customer Survey – Jan 2013

12. 12 Analysis Conclusions Upgrading to Enterprise Edition - Analysis Cost Disruption Risk Value & Benefit

13. 13 Challenges

14. 14 Delay – Escalating Degree of Difficulty Upgrading to Enterprise Edition - Challenges Snowdon Wales UK 3,560 ft. Mt Whitney California USA 14,505 ft. Cholatse Khumbu Nepal 21,129 ft. Degree of Difficulty High Low Time since last upgrade

15. 15 Delay – Diminishing Value Upgrading to Enterprise Edition - Challenges Impact High Low Time since last upgrade

16. User Frustration integrations Customizations Workarounds Support 16 Cost & Risk Drivers Upgrading to Enterprise Edition – Challenges

17. 17 Delay – Growing Problems Upgrading to Enterprise Edition - Challenges Impact High Low Time since last upgrade Widening Gap Lost Opportunities Increasing Cost & Risk Increasing Cost & Risk

18. 18 Tipping the Balance Upgrading to Enterprise Edition - Challenges Cost Disruption Risk Value & Benefit

19. 19 Value

20. 20 Potential Value Drivers Upgrading to Enterprise Edition - Value Business Change Process Improvement IT Strategy Application

21. 21 Supporting Business Change Upgrading to Enterprise Edition - Value Business Change Process Improvement IT Strategy Application Strategic Change Business Rationalization Organizational Redesign Acquisition Divestiture

22. 22 Driving Process Improvement Upgrading to Enterprise Edition - Value Business Change Process Improvement IT Strategy Application Best Practice Processes KPI Improvement Customer Service Supply Chain Production Finance Compliance

23. 23 Improving IT Effectiveness Upgrading to Enterprise Edition - Value Business Change Process Improvement IT Strategy Application Improving Total Cost of Ownership End User Satisfaction Lowering Support Cost Reducing Customizations Version/Instance Consolidation

24. 24 Application Benefits Upgrading to Enterprise Edition - Value Business Change Process Improvement IT Strategy Application New Features Access to Information Visibility & Control Process Alignment Reduce 3 rd Party Footprint Reduce Workarounds

25. 25 Measuring Benefits Upgrading to Enterprise Edition - Value

26. 26 Customer Specific Analysis Upgrading to Enterprise Edition - Value 41 Customers 96 Specific Benefits

27. 27 Benefits – Areas Identified by Customers Upgrading to Enterprise Edition - Value

28. 28 Customer Benefits – IT Effectiveness Upgrading to Enterprise Edition - Value Metric/Area# of responses BenefitsQuoted Value Gains User Efficiency11 Easier navigation Better UI Browses & data access New functionality Management reporting 15% Staff efficiency gain Instance/Version Consolidation 18 Use of domains # of instances reduction # of versions reduction Core model Master Data Management Customization5 Reduced customizations 75% reduction 30% reduction Service Levels7 Improved availability 3 rd Party Replacement 1 Remove 3 rd party system

29. 29 Customer Benefits – Financial Compliance Upgrading to Enterprise Edition - Value Metric/Area# of responsesBenefitsQuoted Value Gains Financial Close7 Faster period closeAverage improvement of 33% Financial Reporting 4 Easier access to data Faster production of reports Increased information visibility New Functionality 3 Improved AR/AP processes User satisfaction User efficiency Financial Standards 4 Roll out standards Improve compliance Segregation of Duties 2 Support clearer SOD

30. 30 Customer Benefits – Manufacturing Upgrading to Enterprise Edition - Value Metric/Area# of responsesBenefitsQuoted Value Gains Capacity Utilization 1 Improved utilization of assets From 75% to 95% Master Data3 Implement best practices processes Standardized data set Scrap1 Reduced defective parts per ‘000 From 0.2% to 0.1% of production output Throughput Ratio 1 Improve production efficiency Schedule Accuracy 1 Improve PlanningReduce planning effort by 25%

31. Addresses global requirements Scalable Ability to adapt to business changes Controls and Audit capabilities -Role based security -Segregation of duties QAD’s “Go To” platform Why Enterprise Edition? Upgrading to Enterprise Edition - Value 31

32. 32 Enterprise Edition - Specific Analysis Upgrading to Enterprise Edition - Value >150 Customers globally Multi Nationals National Companies SME’s

33. Process Improvements Upgrading to Enterprise Edition - Value 33 BENEFITENABLER Decreased manual efforts Improved functionality Improved processes Improved Customer Service Levels Full visibility of stock availability through Available to Promise Improved financial reporting and consolidations Increased analysis fields Expanded accounting layers and reporting Improved product costing Multiple costing methods - e.g., periodic costing Improved returns process Implementation of SSM Elimination of duplicate data entry Increased compliance Industry best practice process maps Increased functionality Enterprise financials multi-GAAP reporting requirements Enhanced audit capabilities Reduction in Risk Implementation of a supported version Migrate to On Demand Improved compliance - industry process models

34. Process Improvements Upgrading to Enterprise Edition - Value 34 BENEFITENABLER Shorter financial closings Improved processes Harmonized data Increased functionality Improved data visibility and one place access to information.NET UI Browses Operational Metrics Improved global planning Increased functionality Database consolidation Improved data visibility Improved reporting Browses Reporting Framework Multiple output options Increased business unit visibility Fully integrated system Standardization of data and processes Increased decision support Operational Metrics with drilldowns

35. End-Users Upgrading to Enterprise Edition - Value 35 BENEFITENABLER Empowered users.NET UI Browses Operational metrics Improved cross-employee knowledge Process maps and attachments Ease of use, intuitive screens Improved user experience and productivity.NET UI Alerting and workflow with Inbox notification Attachments Process maps - process visualization Reduced end-user training time Process maps and attachments Online training Ease of use, intuitive screens

36. Cost Upgrading to Enterprise Edition - Value 36 BENEFITENABLER Cost reduction/margin improvement Elimination of non-value added activities Industry best practice process maps Quicker onboarding of acquisitions Standard operating model Standardized data Master data replication Process maps and attachments Reduced support costs Consolidation of databases Standard common platform Elimination of localizations – internationalization Elimination of 3rd party software Hardware consolidation Implementation of supported software version

37. Technical Upgrading to Enterprise Edition - Value 37 BENEFITENABLER Improved data quality/master data management Data cleansing during upgrade Metrics for ongoing quality Master data replication Improved interoperability Implementation of QXtend Improved security Role based security Segregation of duties Increased audit capabilities Reduction in customizations Implementation of new modules Enhanced functionality Chance to review customization use.NET UI

38. 38 Process & Tools

39. 39 EE upgrade ~20-25% additional effort -Depending upon upgrade method -Delta largely based on ‘new’ process set up Training in new processes EE vs. SE Upgrading to Enterprise Edition – Process & Tools

40. 40 EE vs. SE Process Changes Upgrading to Enterprise Edition – Process & Tools Set Up -Finance -Global Tax Management -Customer -Supplier Accounts Payable -Process Supplier Invoice -Process Payables Accounts Receivable -Invoicing -Process Receivables -Collect Receivables Security General Ledger -Journal Entries -Period End -Inter & Cross-Company -Open Items -Mirror Accounting & Layers -Review Transactions -Consolidations -Manage Budgets -Year End Cash -Use Banking -Flow & Petty Cash

41. 41 Optional Process Changes Upgrading to Enterprise Edition – Process & Tools GL – Periodic Costs & Revaluation Process Sales Orders -Up-Sell/Cross-Sell -Correction Invoices Scrap Subcontracting Audit Trails

42. 42 Technical Re-Alignment Hybrid Re-Implementation Approach Alternatives Upgrading to Enterprise Edition – Process & Tools

43. Like for like Perceived to be quickest and easiest Data quality influences effort/risk No change in: -Business Processes -Functionality Upgrade Alternatives - Technical Upgrading to Enterprise Edition – Process & Tools 43

44. Upgrade Alternatives - Technical Upgrading to Enterprise Edition – Process & Tools 44

45. Pros -Transaction history available -Shortest timeframe, lowest cost (with same financials) -Opportunity to reduce customizations Cons -Difficulty with SE  EE conversion programs -Difficult to convert older database -Data structures may limit EE financial functionality -Little opportunity for data cleansing -Limited benefits Upgrade Alternatives - Technical Upgrading to Enterprise Edition – Process & Tools 45

46. Reload rather than convert data Opportunity to cleanse data Facilitates EE data structures Recommended for upgrades to EE No change in: -Business Processes -Functionality Upgrade Alternatives – Re-Alignment Upgrading to Enterprise Edition – Process & Tools 46 Other than Enterprise Financials

47. Re-Alignment Major Activities Upgrading to Enterprise Edition – Process & Tools 47 Planning Extract Data Extract Data Delta &EE Training Reload Data Technical Training Data Cleansing Data alignment for EE Test Cutover Go Liv e Go Liv e Transaction History -Could be stored in historical database or BI solution -Alternative is to develop optional load process

48. Upgrade Alternatives – Re-Alignment Upgrading to Enterprise Edition – Process & Tools 48

49. Pros -Opportunity to cleanse/restructure data -Enables full EE capabilities -Reasonable time and cost -Easier to align data Cons -Historical data not migrated -Data cleansing may be time consuming Upgrade Alternatives – Re-Alignment Upgrading to Enterprise Edition – Process & Tools 49

50. Based on Technical or Re-Alignment Includes: -Process Improvement -New modules or functionality Can be single or multiple projects Upgrade Alternatives - Hybrid Upgrading to Enterprise Edition – Process & Tools 50

51. Upgrade Alternatives - Hybrid Upgrading to Enterprise Edition – Process & Tools 51 *With Re-Alignment approach

52. Pros -Opportunity to cleanse/restructure data -Enables full EE capabilities -Increased benefits from new functionality -Easier to align data -Opportunity to eliminate customizations Cons -Historical data may not be migrated -Data cleansing may be time consuming -Increased time/cost – process enhancements Upgrade Alternatives - Hybrid Upgrading to Enterprise Edition – Process & Tools 52

53. Start almost from scratch Treated like new implementation Most complex Can be most beneficial -Increases come at cost Upgrade Alternatives - Reimplementation Upgrading to Enterprise Edition – Process & Tools 53

54. Upgrade Alternatives – Re-Implementation Upgrading to Enterprise Edition – Process & Tools 54

55. Pros -Opportunity to start from scratch -Highest benefit -Clean data -New functionality can be leveraged Cons -Highest cost/longest timeframe -No historical data Upgrade Alternatives – Re-Implementation Upgrading to Enterprise Edition – Process & Tools 55

56. New modules or functionality Source/target versions Data quality Resource availability Budget Available time Standardization – current/target Customizations Approach Considerations Upgrading to Enterprise Edition – Process & Tools 56

57. Approach Alternatives Upgrading to Enterprise Edition – Process & Tools 57 APPROACH ALTERNATIVES SOURCETARGET TECHNICALREALIGNMENTHYBRIDRE-IMP Pre-eB2.1Current SE  Pre-eB2.1Current EE  eB2.1 -> SECurrent SE  eB2.1 -> SECurrent EE   Older EECurrent EE  Recent EECurrent EE 

58. 58 Roadmap Phasing - One Project Upgrading to Enterprise Edition – Process & Tools Time Complexity / Value Process Optimization New Features/Functions Customization Rationalization Technical Upgrade

59. 59 Roadmap Phasing – Multiple Projects Upgrading to Enterprise Edition – Process & Tools Time Complexity / Value Process Optimization New Features/Functions Customization Rationalization Technical Upgrade

60. 60 Business drivers/context Approach Change in hosting? Identify: -Resources required/available -Related initiatives -Competing projects -Optimal/Sub-optimal go live timing -All required project aspects Project Scope Single/multi-phased Planning Considerations Upgrading to Enterprise Edition – Process & Tools

61. 61 Involvement of the business Clearly defined project scope Formal project plan and team Realistic budgets and timeframes Effective Communication -Why upgrading -When -How will it affect me? Critical Success Factors Upgrading to Enterprise Edition – Process & Tools

62. 62 Planning/justification -3-Day Q-Scan -Upgrade Q-Scan -Planning Project Execution -Apply Easy On-Boarding methodology & tools -Leverage upgrade experience Training -Technical -Conversion -Functional delta -New modules How Can QAD Help? Upgrading to Enterprise Edition – Process & Tools

63. Identify value potential -Support strategic initiatives -Business process improvement -Information access and visibility -Risk management & compliance Determine deployment options & value case -On Demand -On Premise Outline delivery plan -Conversion/Upgrade process -High level implementation plan 3-Day Q-Scan - Objectives Upgrading to Enterprise Edition – Process & Tools 63

64. 64 Value & Benefit vs. Cost & Risk -Material value -Delay increases cost & risk SE vs. EE -Enterprise Edition is the future -Proven & structured approach Options -Approach alternatives Let us know how we can help Summary Upgrading to Enterprise Edition