Oracle NetSuite: A Review of Accounting Software

Most business leaders would agree that managing complex financials and operations is extremely challenging, especially for fast-growing companies.

An integrated cloud ERP platform like Oracle NetSuite helps simplify business processes and gain real-time visibility across the organization.

This in-depth review of NetSuite analyzes its unified platform capabilities, key benefits, potential drawbacks, ideal customers, and summarizes if it's the right enterprise software for your business needs.

Introduction to Oracle NetSuite

Oracle NetSuite is a leading enterprise resource planning (ERP) software platform designed for organizations of all sizes. Founded in 1998 as NetSuite, it helped pioneer the concept of cloud-based business applications and has grown into a full-featured ERP system covering key business processes like accounting, inventory, ecommerce, CRM, and more.

In 2016, Oracle acquired NetSuite for $9.3 billion, retaining the NetSuite brand name and management team. The acquisition has allowed NetSuite to leverage Oracle's global scale while still operating as an agile, cloud-native business application provider.

Overview of Oracle NetSuite

NetSuite bundles together several applications under one hood to manage end-to-end business processes in the cloud. Key capabilities include:

• Financial Management: General ledger, accounts payable/receivable, budgeting, multi-currency support
• Inventory and Order Management: Purchasing, fulfillment, warehouses, dropshipping
• Ecommerce: Website hosting, customer portals, marketing tools
• CRM and Sales Management: Contact management, opportunity tracking, sales force automation
• HR, Payroll, and Project Management: Wide range of add-on capabilities

A key benefit NetSuite offers is native, real-time integration across modules. This eliminates silos between business units and ensures continuity across systems.

NetSuite also touts its flexibility - both in terms of ability to customize on the platform and also scale up or down as business needs change.

History and Company Background

NetSuite was founded in 1998 by Evan Goldberg as an early pioneer in web-based accounting software and ERP systems. By delivering applications over the internet, NetSuite offered new affordability and accessibility to small and medium businesses.

Key milestones include:

• 1999: Launched first web-based financial management and ERP software
• 2002: Introduced CRM functionality
• 2004: Expanded into ecommerce with website hosting and POS
• 2007: Went public with IPO
• 2016: Acquired by Oracle Corp for $9.3 billion

Today, NetSuite has about 16,000 customers and continues rapid growth under Oracle's ownership. It competes directly with SAP, Microsoft, and Sage as an enterprise-grade ERP platform suitable for larger businesses.

Main Features and Capabilities

NetSuite organizes its core capabilities into software suites:

Financial Management

• General Ledger
• Billing and Invoicing
• Accounts Payable/Receivable
• Budgeting and Forecasting
• Multi-currency Support

Inventory Management

• Purchasing and Fulfillment
• Demand Planning
• Warehouse Operations
• Dropshipping Integration

Ecommerce

• Webstore Hosting
• SEO and Marketing
• Customer Self-Service Portals

CRM and Sales

• Contact and Lead Management
• Opportunity Tracking
• Sales Automation Tools

Add-on modules allow customization for HR, payroll, reporting, and industry-specific capabilities.

NetSuite is especially competitive for global and fast-growing organizations due to its scalability. The integrated platform grows along with businesses through all stages.

Key Benefits of Using NetSuite

NetSuite offers several key benefits that give it an edge over other accounting systems, especially for growing enterprises.

Unified Cloud Platform

NetSuite unifies core business operations on a single cloud platform. This eliminates siloed data and processes by combining CRM, ERP, ecommerce, inventory management, and more into one system. Key benefits of this unified approach include:

• Real-time visibility across the business
• Streamlined workflows with seamless data sharing
• Lower IT costs by consolidating multiple systems
• Agile scaling as the business grows

By unifying data and processes on NetSuite's cloud, enterprises gain a "single source of truth" to operate more efficiently.

Flexibility and Customization

NetSuite allows extensive customization to adapt to complex and evolving business needs. Configuration options, custom fields, scripts, workflows, and an open API enable customers to customize without touching the source code.

Other flexibility features include:

• Integrations: Pre-built and custom integrations connect other apps and data sources.
• Extensions: SuiteApps extend functionality with industry-specific capabilities.
• Multi-subsidiary support: Manage global entities with localized requirements.

This flexibility lets NetSuite match unique business processes without high-cost development. Customization also future-proofs processes as requirements change.

Real-Time Analytics and Reporting

NetSuite enables data-driven decisions through real-time analytics, dashboards and reporting. Built-in KPIs, drill-down reports, and ad hoc querying allow insight into all business operations.

Benefits include:

• Real-time data visibility without manual reporting
• Custom reports and metrics for business needs
• Interactive dashboards to track KPIs
• Data warehousing and drill-down for analysis
• Advanced analytics options like predictive modeling

With a true 360-degree view of the business, NetSuite empowers data-driven strategy and optimization. Real-time analytics is especially critical for fast-changing enterprises.

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Considerations and Potential Drawbacks

Implementation Complexity

Implementing an ERP like NetSuite can be complex, especially for larger organizations. Migration involves moving data, processes, and people to a new system. This level of business transformation requires change management across the organization. Employees need training to use the software properly. Workflows may need redesigning to fit the system. Extensive customizations are common to match specific business requirements, adding to overall project scope and cost.

The implementation process can take 6-18 months depending on the organization's size and needs. Most companies bring on expert consultants to guide configuration and customizations. If not managed closely, projects risk going over budget and timeline. Leadership support is critical to drive adoption and minimize disruptions across departments.

Total Cost of Ownership

While NetSuite promises lower TCO versus legacy systems, realizing a positive ROI depends on the organization. Companies with simple needs may find alternative cloud ERPs provide adequate functionality at a lower price point than NetSuite. Those requiring multiple modules, customizations, and integrations will pay more in licensing, maintenance, and consulting fees.

Small and midsized businesses likely achieve faster payback given NetSuite's SaaS delivery model and out-of-the-box capabilities needing less customization. But larger enterprises tend to require heavy customization, playing to NetSuite's platform strengths but increasing costs substantially.

Vendor Lock-in Concerns

Switching ERP systems is painful, so organizations tend to standardize on a single vendor. Once running on NetSuite, customers invest heavily in configurations, customizations, and integrations making it difficult to rip and replace later on. Porting all historical data and recreating complex logic on a new system is expensive and risky.

Some customers express unease about lack of control compared to on-premise software. NetSuite provides reliable uptime and performance as part of the SaaS model, but clients have less visibility and control compared to hosting themselves. Overall, while inconvenient, the benefits tend to outweigh the cons for most customers.

Who is NetSuite Ideal For?

NetSuite is designed to provide an all-in-one business management solution for organizations with complex operations and specialized needs across key financial and operational processes. Specifically, it offers advanced capabilities that can benefit high-growth companies, wholesale/distribution business models, and service-based businesses.

High-Growth Companies

NetSuite is well-suited for high-growth companies because it delivers unified data and deep visibility across all business processes in a single system. This helps leadership make data-driven decisions to scale operations efficiently. Key benefits include:

• Unified CRM, accounting, inventory, order management, HR, and reporting on a single cloud platform to streamline operations
• Customizable dashboards to monitor KPIs and gain real-time insights into business performance
• Flexible configuration to adapt to changing business needs without costly coding
• Automation for workflows, approvals, alerts, and processes to increase efficiency

By consolidating data and processes into NetSuite's cloud ERP platform, rapidly growing businesses can increase agility, reduce IT costs, and make smarter decisions to sustain innovation and expansion.

Wholesale/Distribution Models

NetSuite is an optimal choice for wholesale, distribution, and inventory-driven companies due to its robust capabilities purpose-built for these industries, including:

• Automated inventory tracking and visibility across all channels
• Advanced supply chain and warehouse management
• Real-time order monitoring and fulfillment orchestration
• Customizable purchasing workflows aligned to business needs
• Dashboards to identify trends and optimize stock levels

By centralizing inventory data and coordinating complex distribution processes in NetSuite, businesses can increase efficiency, reduce carrying costs, and make data-backed decisions to optimize operations.

Service-Based Businesses

For professional services, advertising, marketing, and other project-centric businesses, NetSuite enables better resource planning, project delivery, and customer billing. Key features include:

• Unified CRM for sales force automation and pipeline management
• Advanced project management with customizable templates
• Time tracking and automated billing based on hours worked
• Real-time profitability reporting by service, project, or client
• Flexible invoicing tailored to specific client needs

This gives project teams comprehensive visibility into budgets, tasks, issues and timesheets to execute engagements profitably and efficiently. The system can scale to support multiple client engagements across the organization.

Conclusion and Summary

Key Takeaways

• NetSuite is best suited for growing mid-size to large enterprises needing an integrated business management suite with strong accounting, inventory, order management, and ecommerce capabilities.
• Key strengths include scalability, customization, rich functionality out of the box, and having all information in one place.
• Main downsides are higher costs and complexity compared to entry-level systems, more involved implementations, and a steeper learning curve.
• Ideal customers are complex wholesale/distribution, retail, manufacturing, and services companies needing advanced accounting with multi-entity management and robust inventory/order processing.

Who is NetSuite Best Suited For?

NetSuite is optimized for medium to large B2B and B2C companies with complex operations and significant transaction volumes needing enterprise-grade business management capabilities. The integrated suite approach works extremely well for sophisticated organizations outgrowing entry-level systems.

Businesses that will realize the most benefit from NetSuite typically have:

• Multi-channel sales across brick-and-mortar, online, wholesale, and distributors.
• Make-to-order, assemble-to-order, or engineer-to-order manufacturing.
• Wholesale distribution with stocked and drop-ship items.
• Multi-entity and multi-subsidiary corporate structures.
• Data from multiple sources needing consolidation for unified reporting.

For less complex small businesses, the level of customization and breadth of features may be overkill. The premium pricing and implementation costs could outweigh the benefits compared to mainstream accounting platforms with lighter functionality. But for enterprises meeting the profile above, NetSuite is likely a perfect fit to scale without the limitations of entry-level solutions.

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