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NetSuite socked with lawsuit by textile manufacturer

Chris Kanaracus | July 9, 2014
NetSuite has been hit with another customer lawsuit, this time from textile products manufacturer Kentwool, which alleges the cloud ERP vendor pulled the wool over its eyes in order to take its money.

NetSuite didn't immediately respond to requests for comment on Tuesday. Kentwool's suit is the second filed within a few months against the company for allegedly faulty implementations, following skin care product retailer SkinMedix's action in May.

While aggrieved, Kentwool itself may not have done enough to protect itself, according to a number of industry analysts.

"Kentwool repeatedly says that it relied upon NetSuite's representations of what its system could do," said analyst Frank Scavo, managing partner of IT consulting firm Strativa. "But vendors can be tempted to over-promise during the sales cycle. So it's dangerous to take the vendor's word for anything. You have to do your own reference checks to confirm what the vendor is saying."

However, cloud-based software like NetSuite receives continuous improvements, said Ray Wang, founder and chairman of Constellation Research. That means it's also important to understand what may be on the vendor's near and long-term road maps, he said.

What needs to happen is an industry push to avoid these types of customer complaints, in Scavo's view.

"There are still too many lawsuits involving ERP vendors," he said. "In manufacturing, there's a philosophy called 'zero inventory.' Maybe software vendors should have a philosophy of 'zero lawsuits.' Look at all the reasons you are getting sued and do something to address the core problems. There'd be a huge return on investment for a program like that."

 

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