QAD acquires DynaSys for €6.0 million

QAD Inc., provider of enterprise software and services for global manufacturing companies, has acquired Strasbourg, France-based DynaSys S.A., provider of supply chain planning software solutions, for €6.0 million (or approximately US$7.5 million). DynaSys generated revenues of approximately €5.0 million in 2011 and has approximately 40 employees. QAD plans to build on DynaSys' existing markets and further expand the penetration of n.SKEP, DynaSys' flagship product, into QAD's global customers and the global supply chain planning market. DynaSys will operate as a division of QAD. QAD expects the acquisition will add some additional revenue to the second quarter of FY13, however, at this time, the company has no formal update to its prior financial guidance.
Ariel Weil, CEO of DynaSys, has been named general manager of QAD's DynaSys Division. He commented: "We are very excited to be joining QAD, and believe that by joining forces we will be able to continue to serve our existing customers, as well as expand to even more global markets. This is a positive move for DynaSys, QAD, and all of our customers. By leveraging QAD's global footprint and strategic focus on emerging markets, we will be better able to serve existing and new customers in additional geographies. We look forward to a successful future as part of QAD as we work together to improve global supply chain effectiveness, and help customers become effective enterprises."

Integrated suite

Founded in 1985, DynaSys provides an integrated suite of demand and supply chain planning solutions. DynaSys customers are primarily in France and other countries in Europe. DynaSys has strong penetration in the luxury goods retail and distribution markets, delivering products that handle the challenges of managing complex global supply chains and fluctuating customer demand. Additionally, DynaSys targets the food and beverage and retail markets, where the ability to plan millions of items simultaneously is critical to successful supply chain optimisation. DynaSys also has customers in the pharmaceutical, cosmetics and chemical markets, often supporting them in highly regulated environments.
DynaSys' main solution, n.SKEP, is a fully integrated supply chain planning suite. n.SKEP has been built on a single coherent architecture featuring 'single click collaborative' technology that provides the different players involved in the supply chain access to all decision elements in order to commit to a demand forecast plan. n.SKEP features a memory resident planning model with a common user interface metaphor across all functions; addresses planning related to demand, distribution, production, procurement and master planning; and supports a fully integrated 'real time' approach to Sales & Operations Planning (S&OP). The memory resident architecture allows extremely high system performance and simulation for demand calculation for millions of items.

Unique capabilities

QAD chairman and president, Pamela Lopker, said of the acquisition: "We are excited about the supply chain planning capabilities that DynaSys brings to the QAD product suite, as well as the top-tier customers already using their solution. DynaSys has developed a unique set of capabilities in their n.SKEP product set that we believe will benefit many of our global customers and other companies striving to improve their supply chain effectiveness."
Gordon Fleming, chief marketing officer at QAD, added: "Partly catalysed by the current global economic crisis, we're seeing companies becoming more focused on better managing their supply chain. Many companies now have far more fluctuation in demand and more fluctuation in capacity, so they have a bigger challenge in planning and managing their space. Therefore at QAD we wanted to augment the existing capabilities we had in supply chain with capabilities that covered more of the planning exercise. We have also seen some companies move from running their S&OP cycles for the year to wanting to run S&OP cycles almost daily. So we looked at the market with a view to acquiring a company that had the domain expertise in rapid real-time planning tools and found that Dynasys met our requirements."
Fleming explained that what particularly attracted QAD to DynaSys was that all of DynaSys' planning tools sit on top of one unified engine. Fleming continued: "The complete span of their products covers demand planning, production planning, procurement planning and distribution planning. Then over the top of that is networking and inventory optimisation. This is essentially the layer that allows you to do real-time S&OP, and all of that runs in a single memory-resident model."
Fleming added that QAD will be extending the reach of DynaSys products to its global customers. He also pointed out that DynaSys opens up some adjacent markets for QAD specifically in the area of supply chain planning. "For example, DynaSys have had very strong penetration into luxury retail," he explained. "Our strategy with acquisitions where they're not purely focused on our existing core markets is first and foremost to make sure we're addressing our existing customers' requirements, while also wanting to service new customers that we've acquired and grow our presence in those markets. So in the fullness of time QAD will take DynaSys' n.SKEP product to markets such as luxury retail and high-volume retail in our global territories."

The Effective Enterprise

Lopker explained that QAD has a vision for the future where every customer can call themselves an Effective Enterprise, with every business process working at peak efficiency and perfectly aligned to their strategic goals. "This acquisition will aid in making that vision a reality by adding additional strength to our current supply chain planning capabilities," she said, adding: "In addition, DynaSys is rich in both talent and technology, with exceptional customer commitment, so we see a strong cultural fit between the organisations."
Fleming expanded on QAD's Effective Enterprise concept: "The Effective Enterprise is really the distillation of QAD's vision focused on helping customers to improve their business efficiencies and to make their business processes work in the best way they can. Our definition of an effective enterprise is one where every single business process is working at peak efficiency and is perfectly aligned to the strategic goals of that company. Of course, companies can always improve process efficiency; their strategy and goals are always changing. Nevertheless we strive in everything we do to deliver tools, services, methodologies and measurements to help companies do that. Measurement is important for us because if you're going to prove the efficiency of the process you need to know how efficient it is and benchmark it. And with DynaSys' ability to better plan how you respond to demand you can put in place a resilient process to better balance your demand against capacity, and better align this with your strategies and goals for greater efficiency."
Fleming added that DynaSys offers a technology called Single Click Collaborative. By using Single Click Collaborative technology, each entry or 'click' by a user enables immediate recalculation of all parameters impacted at all supply chain levels; other collaborative users are immediately notified of the induced repercussions. By minimising the number of actions (clicks), DynaSys' technologies are easy to use by the user who can then focus on the specialised added value representing an essential link of the global supply chain. "With benefits such as these, we see the DynaSys – and particularly the way they will strengthen our existing supply chain planning capabilities – as a critical part of helping our customers to become an Effective Enterprise," concluded Fleming.

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