Guild Companies

Developing and distributing software in an open source environment has worked for IT infrastructure elements such as operating systems, database management systems, and email servers. But does it work for more complex applications, such as ERP systems? A startup company called OpenMFG says it absolutely does, and it may, in fact, be better. Last month, the Norfolk, Virginia, company launched its quasi open-source OpenMFG suite, which, in addition to being open source for people who purchase the software, is much less expensive than traditional ERP.

OpenMFG, the client-server application, is not true open source. You cannot look at the internals of the C++ source code or distribute your modifications of it without first purchasing a license (which will set you back at least a couple thousand dollars--veritable chump change for an ERP implementation) or entering into a reseller agreement with the company. Because of this limitation, its creators freely admit that it does not strictly abide by the definition of "open source" set forth by the Open Source Initiative, an industry organization that is trying to standardize a formal licensing definition for open source programs. However, OpenMFG follows the spirit of open source development, in that the application was written in a collaborative environment, with feedback expected and accepted from its users. But perhaps most importantly, OpenMFG's creators encourage its users and resellers to modify OpenMFG to their heart's content.

The OpenMFG story starts several years ago, when Jeff Lyon, now the chief technology officer for the company, started developing the software. A mathematician by training, Lyon has years of experience installing and maintaining ERP systems from some of the biggest names in the business, such as SAP and Oracle, to packages from what he calls "tier three" software companies, which the company says were usually based on old technology, lacked a GUI, and were sometimes woefully under equipped to do the job. Lyon embarked upon his OpenMFG project because he felt there was a lack of affordable ERP packages for small manufacturers that didn't skimp on the functionality and didn't cost an arm and a leg at the same time.

So Lyon started writing code. By making the package open source, Lyon figured that he could accelerate the development and testing cycles that all new software must go through before enough of its bugs are worked out to start building an install base, while keeping costs down. About a year ago, Lyon's work attracted Edward Lilly, who had founded Great Bridge LLC, which had developed applications that built on the PostgreSQL open-source database. Lilly saw what Lyon was doing with the open source model, liked it, and joined the project. As OpenMFG's president and chief executive, Lilly has been instrumental in attracting funding and veterans of the enterprise computing industry to sit on the company's advisory board. Lyon is the chief technology officer.

The fledgling company got a boost earlier this year when it bought the assets of Shopman, a provider of ERP and MRP software to small manufacturers founded by Bill Burns, who now sits on OpenMFG's advisory board. Soon after the acquisition, the Shopman users were migrated to the OpenMFG ERP package, and OpenMFG suddenly had a group of users to test its software and provide feedback and fixes--critical elements for a healthy, happy open source environment.

Today, the OpenMFG ERP Standard package is composed of nine modules that small manufacturers can use to manage their operations. These modules include inventory management, part definition and costing, work order management, master scheduling and MRP, capacity planning, purchase order management, sales order management, shipping and receiving, and sales analysis. OpenMFG says its ERP system provides the same level of functionality as the ERP packages from Exact, Made2Manage, and Navision, which was acquired by Microsoft earlier this year.

OpenMFG ERP Standard lacks accounting functionality, but the company says it will integrate with any third-party financial packages at the individual transaction layer. At this point, the only accounting package the company has tested specifically for integration is the RealWorld Classic accounting system, which is now owned by Microsoft, by way of its Great Plains Software acquisition. OpenMFG is currently developing OpenMFG Deluxe, which will include general ledger, accounts receivable, accounts payable, and fixed asset management modules to the nine other modules. OpenMFG Deluxe should be available in early 2003, the company says.

The open source application itself was built with open source tools, and relies on open source software for its underlying infrastructure stack. The OpenMFG application itself, which is currently composed of 400,000 lines of C++, was written with the Qt open-source application development toolkit from Trolltech, which is headquartered in Norway. Since Qt lets developers target multiple platforms with their source code, both the server and client portions of OpenMFG will run natively on a variety of operating systems, including Windows, Linux, Mac OS X, and commercial flavors of Unix, including AIX, HP-UX, and Solaris. Likewise, the application supports ODBC and JDBC data access methods, thereby allows customers to run Oracle 9i, Microsoft SQL Server, or IBM DB2, if they choose. However, requiring customers to spend a boatload of money on operating system and database licenses kind of goes against the whole open source approach, and OpenMFG encourages customers to consider free and open alternatives. The company recommends that customers use the PostgreSQL database management system, one of the oldest and most widely distributed piece of freeware, and Red Hat's distribution of the Linux operating system.

OpenMFG offers two modes of licensing, both of which are arguably more affordable than your typical ERP package. The annual site license costs $15,000 per year, supports up to 15 concurrent users, includes technical support, and comes with free upgrades. The traditional perpetual license option costs $2,000 per user and includes free upgrades for minor releases, but does not cover major version upgrades. Companies choosing the traditional perpetual license will need to pay an additional 18 percent per year for maintenance to get the major version upgrades. For more information, visit the company online at www.openmfg.com.