ANNUAL REPORT 2009

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ANNUAL REPORT 2009

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2 MESSAGE FROM THE CEO

Välkommen till Jeeves

Bienvenue à Jeeves

Willkommen bei Jeeves

Witamy w Jeeves

Welkom bij Jeeves

Tervetuloa Jeevesiin

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Welcome to Jeeves

– An international ERP system from Sweden

Success at home

In 2009, Jeeves was named Sweden’s most popular ERP system by IT managers in Swedish companies. Building on success at home, in recent years Jeeves has been distinguished by internationalization.

Today Jeeves’ customers are found in more than 40 countries.

Growing small and medium-sized customers

Jeeves’ three complete ERP systems – Jeeves Universal, Jeeves Se- lected, and Garp – are aimed at small and medium-sized enterprises (SMEs) with 5–1,000 employees.

Lowest cost of ownership in the market

Jeeves’ ERP systems offer excellent value in business at the lowest cost of ownership in the market. The systems are attractive because they are:

• easy to adapt to a customer’s unique processes

• easy to integrate with other systems

• easy to upgrade quickly

Business model with heightened customer benefits

Jeeves’ bases its business model on developing and packaging ERP systems, with an international network of partners providing sales, delivery, and support to end-customers. Everyone does what they do best, which creates the conditions to deliver outstanding benefits for customers.

Jeeves’ customers

Välkommen till Jeeves

Tervetuloa Jeevesiin

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4 THE YEAR IN BRIEF

JEEVES ANNUAL REPORT 2009

4

The year in brief

1992 1996 1998 1999 2000 2002 2004 2005 2006 2007 2008 2009

Jeeves’ operations begin. Assar Bolin is the originator of a graphic ERP system for per- sonal computers (PCs) in client-server networks.

First ERP system put into operation in 1993.

ICL Data Oy becomes first foreign partner.

260 systems sold.

Jeeves Enterprise 6.0 launched. 460 systems sold.

Jeeves listed on the O-list of the Stockholm Stock Exchange.

Jeeves Enterprise 7.0 launched, adapted for mobile communica- tion and e-commerce.

Partners established in France and Finland.

620 systems sold.

Contracts with new partners in Finland, the Netherlands, France, and the United Kingdom.

Reveny System AB acquired. New partners in Poland. Jeeves Enterprise is Sweden’s most used ERP system according to DataDIA.

980 systems sold.

Distribution of Jeeves’ revenue, 2009 Sales by geographic area, 2009

Sweden 67%

Rest of Nordic region 26%

Rest of world 7%

Licenses and maintenance 73%

Consulting and training 23%

Miscellaneous 4%

• Jeeves’ sales increased 13% (22)

• During the year, many new customers began using Jeeves ERP systems:

o Jeeves Universal – 126 new customers o Jeeves Selected – 32 new customers o Garp – 36 new customers

• Jeeves was named Sweden’s most popular ERP system in the Exido IT Barometer

• New versions of Jeeves Universal and Jeeves Selected ERP systems were launched

• Jeeves recruited 13 new partners, most of them international

• Jeeves acquired the remaining shares in the partly owned French Master Partner, Jeeves France

• The ERP system operations in the subsidiary Reveny were divested

Jeeves 1992–2009

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HISTORY 5

Jeeves stands for stable development

1992 1996 1998 1999 2000 2002 2004 2005 2006 2007 2008 2009

Jeeves named Sweden’s most popular ERP system.

ERP business in the subsidiary Reveny sold.

194 new customers.

Collaboration with IBM for Jeeves Enterprise on other platforms.

1,070 systems sold.

Jeeves acquires Micro- craft with the Garp ERP system. New partners in Sweden, France, Ger- many, and the UK. New technical collaboration in Business Intelligence and Warehouse Man- agement. 1,534 Jeeves Enterprise systems sold, 1,943 Garp systems.

Jeeves introduces a new international partner strategy and establishes Master Partners in France and Germany. 1,783 Jeeves Enterprise systems sold, 1,972 Garp systems.

Jeeves Universal launched. 187 new customers.

Jeeves Selected launched. Norwegian Logit Gruppen acquired. Master Partner, Jeeves North America, established. 228 new customers.

Stable growth

Jeeves is a Swedish ERP system supplier that has developed steadily since the Company was founded in 1992. Growth has been a high- priority goal for Jeeves since the Company was listed on NASDAQ OMX in 1999. It has been achieved through extensive development to satisfy the tough demands that rapid-growth companies make on their ERP systems. This growth was concentrated in the SME segment (5–1,000 employees), where Jeeves’ market offering attracts customers large and small. Today a company can grow seamlessly with Jeeves – from a small enterprise with five employees, to a full- fledged corporate group with hundreds of employees – and never have to change systems.

Jeeves has achieved a strong position in the Swedish SME market, especially in the wholesale/retail, manufacturing, and service industries. Now, international expansion is vital for the Company’s

continued growth. For a long time, Jeeves has followed its customers out into the world. Today, Jeeves’ customers are located in some 40 countries. In addition, the Company has set up its own operations in several European countries and the North America through Mas- ter Partners and Partners that market Jeeves internationally. 33% of sales currently come from international operations, and that share is growing.

Long-term profitability a high priority

It is important for existing and potential customers to know that they have a stable and reliable ERP system and vendor. That is why Jeeves sets a high priority on growing profitably. At December 31, 2009, Jeeves had delivered uninterrupted profitability for 31 quar- ters – almost eight years. Satisfied customers also vouch for ongoing stable growth.

Jeeves’ sales and operating profit 2002–2009 Sizeable sales by Jeeves Partner

Jeeves’ sales Jeeves Partners’

sales account for roughly 10 times as much as Jeeves’ sales

Jeeves’ ERP systems are sold through 50 or so partners.

Sales related to Jeeves’ ERP systems (Jeeves + partners) are estimated at SEK 2 billion.

2002

200,000 180,000 160,000 140,000 120,000 100,000

80,000 60,000 40,000 20,000

0 SEK

2003 2004 2005 2006 2007 2008 2009

20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 SEK

Sales Operating profit

2002 2003 2004 2005 2006 2007 2008 2009

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Innovation and perseverance make us leaders

2009 has been an unusual year, a year of recession and sagging demand. Jeeves, our employees, and our network of partners have had to pull out all the stops to succeed. Profit was satisfactory, and Jeeves is solid and keeps growing with profitability. Above all we continue to expand new sales!

Sweden’s most popular ERP system

One cause for celebration in 2009 was that Jeeves was named Swe- den’s most popular ERP system, voted by a thousand or so CIO:s in Swedish companies according to the Exido IT Barometer. This is an excellent indicator of our market penetration, demonstrating that our customers value Jeeves’ market offering and how we deliver value in business together with our partners. It gives us and our partners the strength and motivation to continue to advance.

Healthy growth and profitability

Jeeves’ growth continued apace in 2009, as sales expanded 13%

(22). Jeeves has customers throughout the SME segment (companies with 5–1,000 employees), but in 2009 growth came predominantly from sales to smaller enterprises (20–200 employees). Our international sales also fueled sales growth, but the growth rate was limited somewhat by the scarcity of major transactions in the market. Jeeves’

profitability was good, with operating profit of SEK 14.3 million (16.6) and an operating margin of 8% (10). Slower growth combined with the costs of our ongoing build-up of international sales channels has had an impact on profitability. I am satisfied with 2009 performance and see it as confirmation of Jeeves’ durability and strength.

Strong growth requires further acquisitions

Jeeves has successfully carried out several strategic acquisitions and continues to work actively to find additional candidates. Microcraft and its ERP system Garp were acquired in 2005, and their integration into our core business has yielded good results. In 2008, we acquired the Norwegian Logit Gruppen to bolster Jeeves’ position in Norway, also yielding good results through some 15 new Jeeves customers.

We also acquired our French Master Partner business this past year, with 100 or so customers and 1,500 users in the French market.

Finally, in December 2009 and early in 2010, our subsidiary Reveny disposed of its operations, which accounted for about 10% of our sales at the time of divestment. Reveny’s operations and customer base, which we have gradually converted to Jeeves’ ERP systems, are now owned by a Jeeves partner who continues to cultivate that customer base.

Further acquisitions are a prerequisite for achieving our growth targets. Our balance sheet provides the wherewithal to carry out acquisitions. This time we are looking not only in the Nordic region but also elsewhere in Europe.

International expansion continues

Growing internationally is a prerequisite for generating long-term growth and satisfying the needs of customers in an ever more global economy. That is why I raised the bar for our internationalization when I became CEO in 2007. The recruitment of several international partners and the strategic acquisitions in Norway and France since then have been critical steps along that path. The proportion of international sales has doubled since 2006, currently accounting for 20% of our revenue. Faltering demand in the wake of the recession, however, has troubled our new partners and is now slowing our international growth. For this reason, we boosted our sales support and training efforts for international partners during the year, to help them get started more quickly and gain a foothold in their markets.

The fact that Jeeves has succeeded and is expanding in its domestic market is a great advantage. The Swedish market is at the abso- lute forefront of the ERP market, with fierce competition and extremely knowledgeable buyers who make tough demands on their ERP systems. That has given us the conditions for developing world class systems, which we benefit greatly from when we expand internationally.

What we think an ERP system should deliver

Jeeves is based on a powerful idea: providing companies with flexible ERP systems that are good value, broadly support the companies’

operations over time, and contribute to long-term development.

The simplicity of Jeeves architecture enables constant improvement using limited development resources. With a Microsoft-based open solution, the platform is made for the long-term development of our ERP systems. Thus Jeeves has been able to sustain a rapid pace of development over the years, with frequent improvements for customers in new versions of the system, most recently Jeeves Universal 2.0 and Jeeves Selected 2.0.

Our platform has allowed us to make Jeeves highly flexible and loaded with functionality, to be adapted to the special needs that ex-

“Jeeves will be the first choice for any small or medium-sized enter- prise choosing an ERP system.”

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MESSAGE FROM THE CEO 7

Innovation and perseverance make us leaders

ist or are emerging in customers’ business operations. And because the cost of upgrades and customization are the lowest in the market, a move to a Jeeves ERP system quickly shows a profit!

Finally, our business model based on channels sales through dedicated Jeeves Partners gives our customers access to profound expertise for implementing and working with Jeeves. Our Partners are industry specialists and can adapt Jeeves to the particular circumstances in each customer’s industry.

We work consistently with an eye to the future. By sticking to our priorities, we will remain a competitive alternative to the large international ERP systems in Sweden and elsewhere.

Genuine passion and commitment

Jeeves is much more than just an ERP system. I see us as the en- gine in a network of staff and partners who have dedicated their pro- fessional time to developing and offering the market top class ERP systems. “Passion” and “commitment” are words never to be used lightly. But these are two of the strengths I value most about Jeeves.

Every day, I meet employees and partners who see how ingenious our architecture is for the long-term development and continuous improvement of the ERP system and for generating value in business. This has resulted in an energy and job satisfaction throughout our network that reaches all the way to our customers.

A new market on the horizon

It is hard to foresee when demand will pick up again, but when it does, customers will have thought through their criteria for procurement. Qualities such as simplicity, flexibility, and openness will top the list.

My colleagues and I are well-prepared – and Jeeves is well-posi- tioned – to continue to win business and to serve this new market.

Bengt-Åke Älgevik

CEO Jeeves Information Systems

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8 BUSINESS CONCEPT, VISION, GOALS, AND STRATEGIES

Business concept, vision, goals, and strategies

Business concept

Our customers share a need for an ERP system that can be adapted to their operations rather than having to adapt their operations to the system.

Vision

Through the years, Jeeves’ partner strategy has proved successful and will be decisive in our future expansion. In Sweden, Jeeves commands a strong position in the SME segment in wholesale/retail, manufacturing, and services.

Goals

Jeeves’ overall financial goals are:

• annual growth of 15%–20% and

• an operating margin of at least 10%.

Goal achievement

During the past five years, Jeeves has achieved an average annual growth rate of 24%. During the same period, the operating margin averaged 11%.

Strategies

Since its inception in 1992, Jeeves has consistently operated in line with five key strategies.

Growth

Jeeves will grow organically by growing sales in existing and new markets and through acquisitions to further secure its market position. In the future, international expansion will play a larger role for growth.

Profitable growth

Jeeves aims to achieve an operating margin of at least 10% while investing aggressively in products and market expansion.

Market development via partners

Market development, sales, and delivery are conducted exclusively via skilled and experienced partners. To Jeeves, it is vital that both partners and end-customers see Jeeves as their first choice for ERP systems. Jeeves’ partner model is one of its most important success factors.

Up-to-date products

Jeeves offers flexible solutions with broad functionality designed for simple adaptation to customers’ operations. To this end, Jeeves focuses consistently on creating products with a very high degree of technical innovation as well as broad and mature functionality.

Jeeves’ ERP systems are based on smart architecture that makes upgrading to new versions simple. The architecture is also open and integration-friendly.

Motivated employees and partners

Motivated, creative, and skilled employees and partners are the foun- dation of Jeeves as a business and partner. Jeeves’ business model relies on the Company’s ability to develop strong business relationships with various partners.

Jeeves offers user-friendly products based on advanced technology. This demands employees with profound expertise, creativity, and extensive experience.

“Jeeves develops flexible, innova- tive, and cost-effective ERP sys- tems for companies that continu- ously want to evolve.”

“Jeeves will be one of the leading ERP system suppliers internation- ally in the SME segment.”

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“With the market’s lowest total cost of ownership, Jeeves’ customers quickly achieve a return on their ERP system investment.”

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10 ^MARKET

Medium-sized enterprises need to optimize their business flows and be able to integrate with their group.

Flexibility is key in a demanding market

Every company needs an ERP system

ERP systems are the information technologies that enterprises and organizations use to operate, manage, and follow up on their business. The systems often contain modules such as inventory management, purchasing, production, sales, financial management, and hu- man resources management. The ERP systems market comprises:

• sales of licenses and software maintenance

• installation, adaptation, and continuous development

• training and support

• hardware

The market is generally divided into three segments: small enterprises (5–50 employees), medium-sized enterprises and groups and large subsidiaries (50–1,000 employees), and large enterprises (>1,000 employees). Jeeves’ sales focus on companies in the small and medium-sized enterprise (SME) segment. The Company also sells systems to major corporations. The market offering mainly targets the wholesale/retail, manufacturing, and services sectors.

Market for ERP systems recovering

Up until 2009, the European ERP market enjoyed a period of healthy growth, about 7% annually. Growth stagnated in 2009, and consid- erably fewer ERP systems were purchased than previously, primarily as a result of the recession. Once the economy turns around, the pent-up need for ERP systems is expected to generate demand when companies once again seek to streamline for future expansion. Jeeves believes the market will recover in one to three years.

Once that happens, customers will have different requirements on how an ERP system works. Jeeves sees the following important trends, among others;

ERP systems are business-critical

While once just an aid to business operations, ERP systems are now increasingly business-critical. They are also important tools for extracting strategic information for executive-level decision making, which leads to decisions to invest in new ERP systems being made higher up the chain.

Capacity for development

An ERP system must be capable of being developed simply, quickly, and at low cost to meet changes in an operation’s needs, when the business changes, grows organically, or is taken over.

Standardized and customer-specific solutions

To offer customers competitiveness and to enable differentiation, ERP systems must be adapted to the customer’s unique business processes, while the focus in less business-critical areas should be on standardization and simplification to curb costs.

Mobility

Society is increasingly “mobile” and ERP system users want more functionality available via their mobile devices.

Software-as-a-Service (SaaS) and outsourced solutions Ever more companies are searching for new ways to access their ERP systems. The solutions being developed range from buying the entire system via the Internet (SaaS), to operating the system exter- nally with payment models based on the purchaser’s usage.

Jeeves focuses on the SME segment

Large enterprises

> 1,000 employees

> 500 users

Small enterprises need packaged solutions that can be implemented rapidly.

Large enterprises need different ERP systems for different business processes as well as subsystems that can be integrated and are flexible and adaptable.

Small enterprises

Medium-sized enterprises

5–50 employees 5–25 users

51–1,000 employees 25–500 users

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Usability

The new generation of computer users has different expectations about how they will use their ERP system, which means different demands on functionality, the services that the ERP system will offer, and user-friendliness.

General or niche competition

The global market for ERP systems is fragmented, containing different kinds of vendors. There are systems that cover the majority of an enterprise’s functional areas (SAP, Oracle, Microsoft, Jeeves, and Lawson), as well as more niche-oriented players that concentrate on specific functional areas such as customer relationship management (CRM) or supply chain management (SCM).

Jeeves is one of the 25 biggest vendors of ERP systems in Eu- rope. In procurements in Sweden, Jeeves competes primarily with Microsoft, SAP, Visma, and Monitor (depending on the size of the customer). Outside Sweden, Microsoft, SAP, and domestic players are Jeeves’ chief competitors.

Consolidation and partnering

The complexity of today’s ERP system solutions raises the costs of product development, marketing, and delivery, which has led to an ongoing consolidation of the market. Major players use different consolidation strategies to fortify their positions.

• Acquire and then maintain an existing ERP system and its customer base.

• Acquire an ERP system with an existing customer base.

Maintenance of the purchased system is limited by the goal of having customers migrate to the company’s own solution.

• Complement a proprietary ERP system with new functionality.

Another way to cut costs and make inroads into new markets is various forms of partnering. A growing number of ERP system suppliers are channeling a larger share of their sales through partners. Mean- while, the suppliers are concentrating on developing and maintaining the system and on transferring skills to partners, thereby laying the groundwork for greater efficiency and a stronger customer offering, while sharing costs and business risks among multiple parties. Since its founding, Jeeves has refined this approach.

Traditionally, large companies’ needs for advanced solutions have driven the development of ERP systems. But today the requirements of small and medium-sized companies have become increasingly significant. Nowadays, these companies are active in an ever growing context and are an integrated part of business flows, which has boosted demand for broader, more sophisticat- ed ERP systems in the SME segment, too.

The systems in demand in the SME segment look different from the comprehensive universal solutions that are usually rolled out in large organizations with many divisions and thousands of employees. Their corporate culture and approach to operational processes differ. Small companies want to work efficiently but are also looking for greater flexibility so they can be more fleet-footed in business development. They want ERP systems with outstanding functionality, though simplicity is key. The ERP system should install quickly and be easy to adapt to the business. The price tag is also decisive.

Demands from small and medium-sized enterprises are chal- lenging, especially for those vendors who have adapted their ERP systems to satisfy the needs of large customers. It has proven difficult to reconfigure “large” ERP systems as solutions adapted to small customers. Instead, systems developed from the start with the needs of SMEs in focus, such as Jeeves, have won ground.

User focus a challenge

We see that customers are using their ERP systems differently today than previously. The possibilities for integration and strict secu- rity are shall requirements for modern ERP systems.

“The user experience is also increasingly important. How user- friendliness is experienced differs greatly between a 50-year-old with a business degree and a colleague fresh out of school. Mak- ing the most of the possibilities offered by the Internet and mobile devices such as cell phones and handheld computers places tough demands on today’s ERP system suppliers. They have to work hard to create solutions for mobility, introduce alternatives to Software-as-a-Service, and offer integration with new areas such as search engines like Google and social networking through Fa- cebook and Wikis. These present major technological challenges, and the ERP business is relatively conservative, which holds back progress. We are facing generational succession in which a younger, more tech-savvy generation will determine requirements.

Our ERP system suppliers must be prepared for this trend.

Bo Hjort Christensen is director of studies at the Norwegian School of Management in Oslo as well as a consultant and analyst of ERP systems. For about 20 years, he has tracked and analyzed developments and trends in the ERP market.

Here he provides a brief overview of what affects demand for ERP systems in the SME segment.

SME customers demand more from their ERP systems

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12 BUSINESS MODEL

Long-term growth in a scalable business model

Jeeves’ sales and growth are achieved through established partners. The business model is set apart by its scalability, and investments made in product development and software packaging can be adapted to different geographic markets. To foster long-term growth, Jeeves targets selected international markets for initiatives and builds a local sales organization in each, through a Master Part- ner. This strategy requires investments by Jeeves for geographic and other adaptation of the software. Building the international channel also entails an initial investment in marketing and sales, which is done in line with Jeeves’ goal of maintaining profitability along with sound growth, by balancing long-term investments with short-term revenue streams.

Jeeves works with partners

Jeeves’ business model is based on dividing work in the value chain among Jeeves and a network of Partners (resellers). Each participant focuses on their part and does what they do best. This generates great value – from product development, to sales, delivery, and support.

• Jeeves focuses on development, packaging, and maintenance of software as well as marketing. Jeeves also provides Partners with access to effective skills development and support for sales and delivery.

• Master Partners represent Jeeves in strategically vital countries and build up a local brand to establish and support their own network of resellers.

• A Partner sells and delivers products and supports local customers in a clearly defined market segment, geographic market, or particular industry. Each Partner concentrates on its specific customer groups and adapts Jeeves’ ERP systems based on each group’s needs. In Sweden and certain international markets, Jeeves operates directly through local partners.

Recurring maintenance income crucial

When customers invest in Jeeves’ ERP systems, they purchase user licenses and then pay for software maintenance each year, as well as for services such as consulting and training. Total revenues are shared by the partners and, when relevant, Master Partners and Jeeves. The lion’s share of Jeeves’ revenues comes from annual subscriptions and licenses. License and service revenues are fore- most for Partners. On average, over time Jeeves receives about 10%

of total sales at the end-customer level.

Division of tasks and revenue

The illustration indicates the significance of different tasks performed by the participants in the value chain.

Jeeves ^Partners ^Customers

1. Maintenance

Master Partners Jeeves

2. Licenses 3. Service

1. Licenses

2. Maintenance 3. Service

1. Service

2. Licenses 3. Maintenance

Distribution of Jeeves’ 2009 revenue

Licenses and maintenance 73%

Consulting and training 23%

Miscellaneous 4%

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“Jeeves stands for flexibility.

Our ERP systems can easily be adapted, developed, and integrated as a company’s needs change.”

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14 ^PARTNERS

Jeeves Partners form the network of dedicated resellers who actively sell, deliver, and service the Company’s ERP systems. These include 50 or so resellers with about 650 committed associates. Jeeves Partners are mainly in Europe but also found in North America and parts of Asia.

Jeeves Partners specialize in different industries and the needs of businesses in those industries. This gives Jeeves customers access to highly adapted ERP systems, in association with a partner who thoroughly understands what makes for business success.

Different types of Partners

Jeeves has always worked with Partners and has continuously developed the relationships and today there are many international Jeeves Partners as well as Jeeves Master Partners in three countries. In recent years, Jeeves has also recruited new kinds of companies as Partners;

ISV – Independent Software Vendors

An ISV owns, develops, and sells an ERP system. When customers demand more modern solutions, major investment is often required.

The options that Jeeves’ ERP systems offer for adaptation are an excellent fit for an ISV that can then develop a new generation of its own solution with the aid of Jeeves’ ERP systems. Logit Gruppen in Norway, acquired in 2009, is an ISV.

VAR – Value Added Resellers

A VAR develops and sells its own packaged system solution based on Jeeves’ products. The software can also be sold by other Part- ners if the VAR wishes. An example of a successful VAR is Office Factory, which developed a service for accounting tasks for companies based on Jeeves’ ERP systems.

Jeeves Partners – the real specialists

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PARTNERS 15

FACTS

ONGOING DEVELOPMENT OF PARTNERS

Jeeves’ training function, Jeeves Competence Center (JCC), conducted about 50 training days for Partners in 2009. In addition, more than 70 consultants and employees at our Swedish and international resellers were certified.

In 2009, a series of customer seminars began in which various functionalities were presented. Seminars can be attended on-line as a webinar or on-site. A total of 15 or so different seminars were held for our Swedish customers.

JCC plans to reinforce its support for Jeeves’ international expansion in 2010 by training new Partners around the world and enhanc- ing expertise among existing Partners.

Merit Universal has been a partner to Jeeves since May 2009. The company is set apart by its focus on customers’ business processes and how they manage their operations. That makes tough demands on the suppliers of ERP systems with whom Merit chooses to col- laborate. The ERP system must be easy to work with and adaptable for developing the customer’s key processes.

“The point of departure for our collaboration with Jeeves is that a customer’s business must rule. One of the biggest challenges for our customers today is the fast pace of change in the world around us and that customers, in striving to keep up with this, are limited by their system. Our operational expertise, combined with Jeeves’ flexibility when it comes to supporting customers’ processes, is a crucial advantage for our customers,” says Anders Thern, partner and chairman, Merit Universal.

A genuine partnership

Anders Thern was on the team that decided Merit would work with Jeeves. He has more than 25 years’ experience as a purchaser, vendor, and implementer of ERP systems. After six months with Jeeves, he is very satisfied.

“Jeeves’ way of working with partners appeals to us. We have a genuine partnership with a common goal of winning new business, with no competition between us. When we win new customers, both of us win.

Jeeves and Merit have a close relationship in developing sales and marketing activities, and Jeeves provides much support in training Merit’s consultants.”

Merit and Jeeves let the business rule

FACTS

Merit Universal became a Jeeves partner in May 2009. With 160 consultants and 17 offices in the Nordic region and the United Kingdom, the company has long held a leading position as the biggest Nordic partner to Lawson. Now their goal is to complement the current business and also become the leading implementer of Jeeves ERP systems. Merit’s customers are chiefly found in manufacturing and distribution.

Anders Thern, partner and chairman, Merit Universal

Jeeves’ offering to Partners

Jeeves’ attractive Partner program provides the effective and profitable means for Partners to bring Jeeves products to market.

Jeeves assists Partners all along the way with a variety of support and tools.

• A strong and distinct brand, ready-made campaigns, messages, and instructions how Jeeves’ brand should be communicated for effective sales.

• A packaged product for efficient sales and delivery to customers.

• Ready-made platforms for standardized demonstrations.

• Program to efficiently manage large customers and services that support solutions for Partners’ customers.

• Training programs for salespeople and consultants.

• Expert advice as an aid in the sales process.

• Customer care activities such as a user group, customer surveys and customer days.

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16 JEEVES’ PRODUCTS

ERP systems for small and medium-sized enterprises

JEEVES UNIVERSAL

Jeeves Universal targets medium-sized and large enterprises with more than 50 employees that have complex operations based on several different business processes. Customers’ needs, businesses, and processes are the starting point for this modern ERP system with wide-ranging functionality and plenty of options for adaptation and integration. The system also offers a role-based interface with powerful support to users in performing their tasks.

Swedish Orphan International has been a Jeeves user since 2003. The company develops and sells “orphan drugs” – pharmaceuticals for rare and life-threatening diseases. Patients are found the world over. Swedish Orphan International has sales close to SEK 700 million and 140 employees.

JEEVES SELECTED

Jeeves Selected is aimed at small enterprises with 5–50 employees that have the goal of growing and expanding their business. The system offers the cen- tralized functionality that a small enterprise needs. Jeeves Selected uses the same basic technology and system architecture as Jeeves Universal, enabling a small but growing company to smoothly step up to the larger system with greater functionality when the business requires. The customer “seamlessly”

grows into the larger suit.

Frank Dandy AB procured an ERP system at the end of 2009, and the choice fell to Jeeves Selected. The company owns the Frank Dandy Superwear brand, which has become a leading brand in fashion undergarments in Scandinavia through innovative design, high quality, and attention-getting marketing.

GARP

Garp is a complete ERP system for small and medium-sized rapid-growth companies with 5–50 employees, primarily in manufacturing or wholesale/retail.

Garp features numerous optimized business flows, from customer and supplier relationship management, to logistics, production, and annual accounts. Like Jeeves’ other systems, Garp is easy to implement and earns a quick return on investment. All adaptations are ported when upgrading.

Bolon AB has run Garp since 1998. Bolon is an internationally successful de- sign firm that sells innovative flooring of the highest quality in more than 30 countries. The company has well known customers such as Chanel, Armani, Dolce & Gabbana, and Sheraton. The company has 54 employees, and its registered office is in Ulricehamn, Sweden.

“Jeeves Universal gives us plenty of options for enhanc-

ing our efficiency and gaining better

control.”

“The possibility of seamlessly scal-

ing up to a more comprehensive sys-

tem is hard to find anywhere else.”

“Garp has made possible extremely

cost-effective growth”

» Niclas Winroth, CFO, Frank Dandy AB

» Astrid Wernered, System Administrator, Swedish Orphan AB

» Beate Eidhall, CIO, Bolon AB

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“89% of our customers are willing to recommend Jeeves to others”

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18 MARKET OFFERING

Jeeves’ advantages tip the scales

Successful companies constantly evolve and deal rapidly with changes in their operating environment. Success demands coordinating strategy, business processes, organization, and key performance indi-

cators – in other words, a comprehensive ERP system. The choice of ERP system plays a decisive role for enterprises that want to be competitive today and in the future. Jeeves customers understand this.

SIX IMPORTANT REASONS TO CHOOSE JEEVES

1. WORLD CLASS FUNCTIONALITY

Good functionality is often the starting point in selecting an ERP system. Fundamental to Jeeves’ standardized system is world class functionality with comprehensive and smoothly functioning process support that satisfies the needs of small as well as large enterprises.

2. LOWEST COST OF OWNERSHIP IN THE MARKET

Jeeves offers the lowest total cost of ownership in the market. The total cost of ownership for an ERP system is the sum of all costs of adaptation, upgrading, and integration of the system during its service life. With Jeeves, all of this can be done quickly and efficiently. Combined with a modern ERP system that supports and keeps up with the company’s growth, this means that the value in business significantly exceeds the cost of ownership. Jeeves customers quickly achieve a return on their investment.

3. FLEXIBILITY IN MULTIPLE DIMENSIONS

A good ERP system develops as the needs of the company change.

Jeeves manages this by offering extreme flexibility in several areas.

• Adaptation – Jeeves’ ERP systems are easily adaptable to each company’s specific needs. Adaptation is done in a short time with a minimum of consulting hours or by the customers themselves.

• Upgrades – Jeeves’ ERP systems are upgraded quickly and easily. Previous customizations for the company are automati- cally ported into the new version. So Jeeves customers can easily have a continuously adapted and up-to-date version of the system using the latest functionality.

• Simple integration – Jeeves’ ERP systems are open and designed to easily integrate with most other IT systems and products that customers use.

Cost per upgrade and user

Movex SAP R3 IFS IBS ASW Jeeves

50,000

25,000

0 SEK

27,000

45,000

30,000

35,000

2,000

Source: Radar Group

The cost of upgrading Jeeves to new versions is extremely low.

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THE BEST OF BOTH WORLDS

The value Jeeves delivers tips the scales. Customers have a modern ERP system that efficiently pulls together strategy, business processes, the organization, and key performance indicators. The key to this is a flexible standardized system that offers the best of both worlds.

• A standardized system with abundant and reliable functionality under continuous development.

• A flexibility that makes it simple to adapt the system to each customer’s needs and an upgradability that easily ports implemented customization, making it possible always to have access to the latest functionality. And all this at the lowest cost of ownership in the market.

“Jeeves – the ERP system where value tips the scales”

VALUE

• Business processes/Roles

• Functionality

• Flexibility & standards

• Quick upgrades

COSTS

• Software

• Upgrades

• Adaptation

• Integration 4. SEAMLESS GROWTH

Jeeves Selected and Jeeves Universal are built on the same basic technology and system architecture. This enables the small but growing enterprise to smoothly move up to the bigger system, with expanded functionality, when business requires, without having to change systems. The customer “seamlessly” grows into the larger suit.

5. EXTREMELY USER-FRIENDLY

User-friendliness is a prerequisite for a good ERP system and makes it possible for everyone to work efficiently. Jeeves offers a complete set of predefined business processes, such as for sales, manufacturing, delivery, and financial control. The ERP systems include ready-made interfaces for numerous user roles, such as salesperson and production manager. Each staff member is associated with a standardized or individually defined role in the system for which the functions, flows, and information required are predefined and easily accessible.

6. EASILY ACCESSIBLE SERVICE

Jeeves’ network of partners works closely with the end customers.

The partners have excellent business skills and experience in working with Jeeves’ ERP systems. They also have great expertise within specific industries and thoroughly understand their clients’ special circumstances. This enables them to deliver the ERP solutions that clients expect, on time and within budget.

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20 ^CUSTOMERS

Jeeves customers found throughout SME segment

With its ERP systems – Jeeves Universal, Jeeves Selected, and Garp – Jeeves has a comprehensive market offering for customers throughout the segment for small and medium- sized enterprises (SMEs).

Customers looking for a new ERP system often find themselves in one of the following situations:

• a growing company that has outgrown its ERP system and is looking for a solution that will enable it to expand its business,

• a company that has an inflexible solution that is difficult and expensive to upgrade and adapt to the needs of the business, or

• a company that has an old solution no longer supported by the vendor.

Jeeves’ customer base is growing

Jeeves’ base of customers is steadily growing, attracted by the flexibility, upgradability, and low cost of ownership offered. Thanks to the cost efficient solutions provided, a change to Jeeves can often be more economic than an upgrade of the existing system. Though the current economic situation has had a negative impact on the market for ERP systems, Jeeves gained about 200 new customers in 2009.

At the same time, existing customers showed strong loy- alty. Since the Company was founded, only a few customers have left Jeeves.

Sweden’s most popular ERP systems

In Sweden, Jeeves has held a solid position for a long time.

When roughly 1,000 IT managers in Sweden ranked various ERP systems in the 2009 Exido IT Barometer, Jeeves was named “Sweden’s most popular ERP system.”

Proportion of international customers expanding

Many of Jeeves’ Swedish customers are international, with operations in many countries. As support for these, Jeeves’

ERP systems have been localized for several non-Swedish markets, above all central Europe and North America, where Jeeves also has local partners. To further reinforce the international operations, in early 2009 Jeeves established two subsidiaries in Germany and the U.K. tasked with simplifying the internationalization of customers, in cooperation with local partners.

Customer base

Jeeves’ customer base 2009

New customers 2009 126 32 36

Installed customer base 2,011 49 2,192

Universal Selected Garp

Distribution of customers by segment

Production 33%

Wholesale/Retail 29%

Others 16%

Services 22%

Distribution of customers by geographic area

Sweden 72%

Rest of Nordic region 9%

Rest of world 19%

Representative Jeeves customers in different segments

Wholesale/Retail Manufacturing Services

Size

Triade Svenska Elkedjan

Ridderheims Delikatesser Silva Sweden

Pictura Frank Dandy

Elopak SSAB Oxelösund Finndomo

Tylö Karo Bio Hagmans Kemi

SOS Alarm Skistar StroedeRalton

Bilda Förlag Swedish Union of

Tenants Middagsfrid

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CUSTOMERS 21

Ricoh:

“Everything has worked beyond expectations”

Decor Maison:

“A system in which to grow”

What were you looking for in your procurement of an ERP system?

When we, at what was then Carl Lamm, decided on Jeeves in May 2007 we had not yet been bought out by Ricoh. Of course, it was important for the ERP system to be able to support our business activities. But one thing we were especially looking for was a system that we could easily influence along the way. Another key requirement was that it be easy to upgrade to new versions. The system should not be “locked in” with one vendor; we wanted to be able to develop it our- selves, and with the system vendor and consultants.

Why didn’t you change to the ERP system that Ricoh in Europe mainly uses?

Ricoh thoroughly assessed our processes but con- cluded that their current ERP system could not support our business process. Among other things, we’ve built a presystem for Jeeves where we can enter 2,000 IT products into the ERP system. Jeeves also has an

order entry flow that is tailored to our needs. However, Ricoh Europe has made tough demands on integration with their system, such as with the purchasing and delivery processes of the Ricoh products. That part has also gone smoothly, and we’ve had no problems integrating Jeeves with their system.

How has Jeeves worked at Ricoh?

Everything we asked for in the procurement has performed beyond expectations. Now and before the buyout, we expanded and added business lines, and that’s worked beautifully with Jeeves. We have made some difficult and uncommon demands; for example, early on we decided that all of our 150 salespeople would themselves work directly in the system. It is a very complex process and it’s unusual that the system and the salespeople could handle it, but it has worked extremely well with Jeeves. Now we are going to upgrade our system and, after the tests, it looks good, though we have many adaptations.

Why did you choose to change your ERP system?

Decor Maison wants to develop its business in the long run, so the ERP system is important. Our old system handled basic functions like order, inventory, and accounting, but had limited options for development. Those limitations and the problems we had with multiple simultaneous users were the main reasons for changing our ERP system.

What convinced you to choose Jeeves Selected?

For us, it’s important that the system is adapted to small enterprises but can be expanded as the company grows. Our plans for international expansion are important right now, because we want to boost

our exports. We need an ERP system that can handle different currencies and languages when we deal with our export customers. Another key argument for choosing Jeeves Selected in the long run is its possibilities for creating an integrated ERP solution for the entire Gimmersta Gruppen.

How have you chosen to implement Jeeves Selected?

We started by installing the standard system with a few customized layouts for the invoice templates. Our first goal was to get all the core processes to work. As we progress, we’ll move on and expand its functionality and complexity.

Ricoh Sverige was formed in 2009 by the combination of Carl Lamm and NRG. Ricoh is active in the document and information management sector and offers comprehensive solutions for customers’ IT environments.

The Company has operations in 26 locations in Sweden, more than 600 employees, and sales of about SEK 1,500 million.

Decor Maison is a wallpaper brand as well as a company that is part of Gimmersta Gruppen, a family business that has been at the forefront of the Swedish wallpaper industry for more than three decades. Decor Maison is headquartered in Borås, where they design their various wallpaper collections. Most of the collections are manufactured in the Nässjö Tapetfabrik, a factory going back to the 1870s.

Decor Maison’s collections are sold in 1,000 stores in Sweden, in the Nordics as well as parts of Europe. Today the company employs seven people and has sales of SEK 25 million.

Jan-Ove Svensson, Project coordinator for the implementation of Jeeves Selected Lars Broms, Business System Manager, Ricoh Sverige AB

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22 ^EMPLOYEES

We drive development together

Jeeves is a development company that draws its energy and success from the commitment, creativity, and skills of its staff. From the start, the participation of employees has been fundamental to Jeeves’ progress.

The Company culture is distinguished above all by an entrepre- neurial spirit and passionate employees who are dedicated to creating, with partners and customers, the market’s best ERP systems.

Freedom with responsibility

More than 100 people are employed at Jeeves. The Company has a relatively flat organization in which every employee plays an important role and where management is based on the motto “freedom with responsibility.” Decision making and management are aided by close integration of the Company’s goals with its business planning process, the goals and plans of departments/work groups, and indi- vidual performance reviews.

Extensive learning in day-to-day work

Jeeves strives to always have a market offering in line with customers’ needs, so staff have to continuously monitor and understand

what customers want. To achieve this and to generate a dynamic feeling in development, Jeeves combines close customer contact with staff often working on partners’ premises and partners being invited to Jeeves.

A large part of the staff has worked at Jeeves a long time. Many also have vital experience with other ERP systems from previous employment.

Skills improve primarily in daily work. The Company culture en- courages staff to share their know-how and learn from one another.

Jeeves’ growth outside Sweden is also yielding major opportunities for international development in cooperation with and in the build-up of Jeeves’ partner network in different countries. To manage this internationalization, all employees are also offered training in English.

Salaries and incentives

Jeeves’ salary model is based on a basic salary combined with a bo- nus program explicitly linked to results. The Board of Directors wants associates to benefit from healthy earnings. In 2007, Jeeves initiated a convertible debenture program aimed at all permanent employees in the Jeeves Group. The program continues through 2010. The program could result in dilution of 5% at most.

Employees

STATISTICS – EMPLOYEES 2009 2008

Average number of employees 129 113

Number of women 37 32

Number of men 92 81

Average age 41 years 41 years

Employees by function

Development 26%

Service 41%

Products 11%

Market 13%

Management/

Administration 12%

The majority of Jeeves’ employees work in development and service.

ANNUAL REPORT 2009