Ross Systems Inc, the business software house, has seen better than 40% revenue growth from license sales to clients in its core process manufacturing market, said CEO Dennis Vohs. Overall revenues for the fourth quarter, including consultancy and maintenance, grew 19% to $28m while net profits rose to $1.9m from last year’s $2.7m loss. Revenues for the year reached $92m and Vohs says his company will continue fight off its bigger ERP rivals by offering modular software with a better fit to the process manufacturing niche. A positive review of the company’s software from Gartner Group has also led to a link up with the consultancy arm of Deloitte & Touche, an on-going partnership which has launched 18 deals for Ross in the last quarter. These kinds of links with the big accountancy firms have previously been out of Ross’ reach, said Vohs, because the company’s giant rival, SAP AG, was hogging so much attention. But by concentrating on the process industries such as chemical and metal manufacturing, Ross has got its products noticed. On the financial side, Vohs said We have made significant progress toward our objective to improve the consistency of our results, referring to Ross’ recent history of fluctuating earnings. The company consistently closes 65% of its license deals in the last two weeks of a quarter. Which means the difference between a good and bad quarter can often hinge on such precarious factors as whether or not a client’s chief executive has a fax machine at his weekend beach house with which to sign off the deal. This end loading effect has proved immutable, according to Vohs, and so the company has resorted to a less aggressive revenue recognition policy, smoothing earnings with a bigger deferred revenue balance. Outside of quarterly reporting burdens, Ross has seen Year 2000 worries continues to drive sales as companies choose to throw out older systems and replace them rather than attempt a patch up. This is especially true of acquisitive companies facing system integration as well as millenium compliance issues, said Vohs.
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