What Is FRx Software?

FRx Software, the Microsoft subsidiary responsible for the FRx financial reporting and Forecaster budgeting applications, will merge with the group responsible for the forthcoming PerformancePoint Server 2007, a new performance and financial management application. FRx Software's products will eventually become part of one or more PerformancePoint products. However, these products will not provide the same support for third-party general ledgers as FRx Software's products, which work with a variety of accounting packages, implying new integration work for vendors of those products. Furthermore, Microsoft's expansion of the nascent PerformancePoint brand could confuse customers and partners.

FRx Software is a wholly owned subsidiary of Microsoft. The company was acquired in early 2000 by Great Plains to provide financial reporting and budgeting tools for the Great Plains and Solomon enterprise resource planning (ERP) applications. Great Plains was acquired by Microsoft in 2001; the Great Plains and Solomon applications, now called Dynamics GP and Dynamics SL, are two of Microsoft's four ERP products, which also include Dynamics AX and Dynamics NAV.

FRx Software markets and sells two applications, FRx and Forecaster

FRx helps accounting professionals build financial reports from data in companies' general ledger systems and can distribute reports as e-mail and HTML documents. The product has more than 115,000 customers, many of whom use FRx with non-Microsoft accounting systems. FRx's most recent release was FRx 6.7, which shipped in Mar. 2004.

Forecaster allows financial planners and departmental employees to create, access, update, and track budgets, using a Windows client application or a Web browser. For example, workers can use Forecaster to compare budgets against actual spending tracked in their company's general ledger. Budget data are stored in a SQL Server database. (Oracle is also supported.) Forecaster 7.0 shipped in Mar. 2007.

FRx and Forecaster work with all four Dynamics ERP product lines and can be used for reporting and budgeting with most other general ledger systems, such as Sage's MAS 500 and Epicor's Enterprise.

Merging with PerformancePoint

In June 2007, Microsoft will dissolve the FRx Software subsidiary and merge it with the Office Business Applications unit. Most of FRx Software's roughly 130 employees will move into one of two groups: sales and marketing personnel will move into the Office Business Applications Product Management group managed by General Manager Chris Caren, while research and development personnel will report to General Manager Bill Baker, who is responsible for the Office Business Intelligence Applications group. The move is organizational only—most employees will remain in Denver, where FRx Software is based. Along with the move, Microsoft plans to merge FRx Software's and Office Business Applications' product lines, first by rebranding, and then technically. (For an overview of Microsoft's schedule for merging products, see the illustration "FRx, Forecaster, PerformancePoint Timeline".)

Splitting the PerformancePoint Brand

Microsoft will no longer market products under the FRx Software brand beyond FRx 6.7 and Forecaster 7.0. The company has shelved plans for an FRx 7.0 release, which it had originally planned for early 2006. Instead, Microsoft plans to release future enhancements to FRx under the PerformancePoint brand, which is owned by the Office Business Applications team.

Prior to the dissolution of FRx Software, the PerformancePoint brand contained a single product—the planned PerformancePoint Server 2007 financial analysis and budgeting application. Along with new financial modeling, forecasting, budgeting, and reporting capabilities, PerformancePoint Server will absorb two existing products:
 

• Business Scorecard Manager (BSM) 2005, a performance management product that helps companies define and track key performance indicators (KPIs) and presents users with scorecards that display KPIs in reports and charts
• ProClarity, a data visualization application (acquired in the 2006 purchase of ProClarity Software) that allows users to work with SQL Server Analysis Services data using either a browser or a more full-featured thick-client application.

Management Reporter Missing Some Features

The first PerformancePoint-branded successor to FRx will be called PerformancePoint Professional 2007 Management Reporter. This product will deliver some of the features originally promised for FRx 7.0. However, Management Reporter will contain only a subset of the features found in its predecessor, FRx 6.7. Specifically, Management Reporter will contain a client application for designing financial reports but will not include the FRx server components for central management and distribution of those reports or Web access to them. Because it will not contain all of the features of FRx 6.7, many customers of that product will probably opt not to upgrade to Management Reporter, at least in its initial release.

Management Reporter is scheduled to ship in the third quarter of 2007, at about the same time as PerformancePoint Server 2007. According to Microsoft, Management Reporter will not require or depend on PerformancePoint Server 2007, but users will be able to build financial reports from financial models created with PerformancePoint Server. The roadmap beyond the initial Management Reporter release is not clear: some missing features might appear in future Management Reporter releases, be absorbed by PerformancePoint Server or other Microsoft products such as SharePoint Server, or cut altogether.

Microsoft has indicated it will continue to offer FRx 6.7 as an independent product for several years after the release of Management Reporter and will probably support the product through the next two major revisions of Office (the most recent Office version, Office 2007, shipped late in 2006).

The company has not set pricing for Management Reporter or worked out licensing details for FRx customers wanting to move to Management Reporter or PerformancePoint Server, although it will probably credit customers for existing FRx licenses when they upgrade.

End of the Line for Forecaster

Microsoft has said that the features of FRx Software's other product, Forecaster, will be absorbed by PerformancePoint Server beginning with the second major release of PerformancePoint Server, which will probably ship in 2009 or 2010. (Forecaster 7.0 is the last stand-alone release of the product.) For example, PerformancePoint Server will incorporate the detailed financial logic, such as Federal Insurance Contribution Rules (FICA) rules, that exists today in Forecaster.

Microsoft will continue to sell Forecaster 7.0 until the second version of PerformancePoint Server ships and provide product support until 2012. The company has said that customers of Forecaster 7.0 with active maintenance contracts will be able to swap their Forecaster server and user licenses for an equal number of PerformancePoint server and Client Access Licenses (CALs).

Migration Issues, Potential Confusion Loom

Merging FRx Software into the unit responsible for PerformancePoint gives the group an infusion of marketing and development personnel with accounting expertise who can help refine its products, which appear to be an important component of Microsoft's business intelligence (BI) applications strategy. For example, the move could help Microsoft quickly refine the financial reporting and budgeting features of PerformancePoint Server.

Nonetheless, the move spells the end of the line for FRx Software's products, and customers of those products will eventually need to migrate to PerformancePoint Server, Management Reporter, or a competitor's product. Although PerformancePoint Server and Management Reporter will eventually include capabilities similar to those of Forecaster and FRx, the underlying code, data models, utilities, and user interface will differ. Migration will be particularly complicated for customers of FRx, who may find that product's features distributed among two (or more) new products.
Consequently, if FRx Software's customers stay on the Microsoft product track, they could be saddled with complex data migration projects, more complex infrastructure, significant retraining, and increased cost. As Microsoft usually does when introducing major product revisions, it will likely offer tools and training to help existing customers migrate away from FRx Software's products.

Furthermore, while FRx Software's products were able to access and import financial data from a wide variety of Microsoft and non-Microsoft accounting products, PerformancePoint Server and Management Reporter will not offer the same degree of general ledger independence. With PerformancePoint Server and Management Reporter, Microsoft will focus most intently on integration with its own accounting products and perhaps those of major vendors, such as SAP and Oracle. Beyond those applications, the company will leave it to partners or the vendors of other accounting products to create plug-ins for automatically importing financial data into PerformancePoint Server or Management Reporter.

Finally, customers and partners will likely be confused by Microsoft's plan to bifurcate the PerformancePoint brand, a brand that has yet to be introduced to the market. Among several potential points of confusion, Microsoft will need to clearly differentiate the use scenarios and target markets of the two PerformancePoint-branded products, which appear to have considerable functional overlap. Furthermore, the company will need to determine how (or if) it will move forward the many FRx components that will be left out of the initial Management Reporter release, a decision that could have major impact on existing FRx 6.7 customers.

FRx Training from Microsoft site:

Microsoft Business Solutions FRx 6.7 Report Design Essentials I Course Number 8399
https://mbs.microsoft.com/customersource/training/trainingmaterials/student/course8399.htm?printpage=false

Microsoft Business Solutions FRx Reporting Design Essentials II Course Number 8400
https://mbs.microsoft.com/customersource/training/trainingmaterials/student/course8400.htm?printpage=false