November 24th, 2009

SAP Users start to flex their muscles

Posted by Dennis Howlett @ 6:07 am

Categories: Uncategorized

Tags: SAP AG, Business Structures, Leadership, Finance, Management, Dennis Howlett

User group conferences are always great places to test the pulse of what’s happening in the real world. While wandering the halls of the SAP UK and Ireland User Group annual conference this week, I came across customer representatives prepared to openly share their experiences. While there are gripes aplenty, alll I spoke with believe SAP will help them to achieve value. Eventually. That is in marked contrast to 2008 when the mood was more somber and where concerns were almost exclusively focused on the maintenance price issue.

That topic is still current and I was heartened to learn that customers are far more aware of the need to consider negotiation, along with supporting their user group leaders in discussions with SAP. However, that doesn’t mean contract issues have evaporated or that SAP is considered to be playing the partnership game as well as it could. I still managed to find customers who had not undertaken a detailed assessment of contract clauses that might be reviewed, others who were not fully aware of third party maintenance options or, in one case, that they had any sort of choice.

On the other hand I found a user group more at ease with itself and making genuine headway with SAP in gaining access to senior SAP executives and development teams. Alan Bowling, chairperson UK&IUG said: “SAP still develops stuff that only five people will ever use and then tries to drop it on us. We can now get in early and tell them that some things are either irrelevant or might be better if approached from a different angle. We’re gaining access to advanced roadmaps that would have been kept from us. These kinds of change are welcomed and a sign that SAP is becoming much more customer focused.”

That doesn’t mean that all is rosy in the SAP garden. Colleague Ray Wang delivered a keynote on innovation that must have sent shivers down some SAP execs spines. Calling out five ‘failures’ in adoption/communication, I could see the delegate heads nodding in tacit agreement. (see video above)

November 20th, 2009

Conference energy levels

Posted by Dennis Howlett @ 6:00 am

Categories: Uncategorized

Tags: Salesforce.com Inc., Software-as-a-service, Event, Software As A Service (SaaS), Managed Hosting, Sales Force Management, Cloud Computing, Emerging Technologies, Sales, Dennis Howlett

Coming to Dreamforce has been a revelation. The news was dominated by Chatter but that only tells a fraction of the real story. As I sat in the media room chatting (sic) to an old buddy it occurred to me this was a conference that annoyed for all the right reasons. Try as I might, I couldn’t find a single disaffected customer. Out of an alleged 19,100 registered attendees, surely there must have been someone who was ticked off with Salesforce.com? If they were then I couldn’t find them. That’s got to be a good thing.

But I did come across one person who was less than impressed with Chatter: “Two and a half hours in and I’m thinking, all I want to do is pee,” says a lot for Salesforce.com CEO’s perception of what constitutes acceptable timing for a keynote.

Some of us might find CEO Marc Benioff’s insistence on running three hour keynotes tiresome and over done (as did my new found friend) but then as the poster child for fun led SaaS, it’s hard not to enjoy events of this sort. From his corny cracks at Sharepoint to an off the cuff remark he made to one of his EVPs with whom I was in a deep dive around scalability where Benioff said: “You don’t want to believe a word this guy says,” there is a playfulness behind Salesforce.com that keeps a lot of people smiling. Outside the event, I chatted with many customers whose impressions can be summed up in two words: ‘value achieved.’

The same goes for partners. I spent time with Jeremy Roche CEO of Financialforce.com. I’ve known Jeremy a number of years and in the above video he can barely disguise his excitement at what this event is delivering to his company. To say that visitors were queuing five deep at the company’s booth is not an exaggeration. On the first evening, security had to close them down 15 minutes after the official show close. Staff had to be shipped in to handle the demand and were working 14 hour days. That’s the sort of buzz I saw at this show. “No tumbleweed here,” is Jeremy’s opinion.

Contrast that with the relatively somber, under attended events of the incumbent on premise vendors where almost nothing of substance has been announced this year and where the buzz, if any, has been muted. That’s a natural breeding ground for disaffection and something you could sum up in two other words: ‘content free.’

My colleagues agree the energy levels at Dreamforce hark back to the early days of ERP and the heyday of Siebel where you had to beg to get in on events they were so much in demand and where something fresh and interesting was emerging almost every quarter. These days, the new stuff is happening daily. You have to be both a sprinter and marathon runner to keep up. That’s all to the good.

We shouldn’t get too excited though because regardless of Salesforce.com’s relative health combined with the fact it is still hiring people, the general market for IT is flat. But if I’ve learned anything this week it’s that there’s still a hunger for game changing innovation. When it’s visible, people get excited. When it’s hard to see, people start questioning the value of their IT investments.

The incumbents will argue that Salesforce.com is addressing a sliver of what matters to enterprise. We can debate that but in reality it is a symptom of an incumbent market that’s mature, fat and lazy. The new kids on the block know that for SaaS to survive, they have to maintain energy not just now at marquee events but well into the future. It is perhaps a sign of what this market is about that for SaaS vendors to succeed, they have to deliver day in day out. No shipping a CD, taking a fat check and walking away with an entitlement to 22% maintenance. That’s a very different value proposition.

Apart from all the happy faces, where is the evidence for the veracity of my claims? Run a Twitter search on #sapteched09 and #df09. I was running a Cover-it-Live session on #df09 and the quantity of people diving into the Twitterstream was extraordinary. Apart from the few hours of sleep people took after the close of the invitation only Appirio party at the end of the first day, the stream was relentless. As I am drafting this, the stream continues some three hours after the event closed. Compare that with TechEd where you’ll find the ‘usual suspects’ and some others. Nothing like the buzz at Dreamforce.

And one more thing. There wasn’t enough time to meet all the people who had put requests my way. It’s a while since that happened. That’s not so good. Maybe another time I’ll take an extra day to pack it all in.

Is it any wonder that buyer advocates are so enthusiastic about SaaS?

Disclosure: CODA, from which FinancialForce was spun out is a site sponsor and occasional client.

November 19th, 2009

Chatter: Amplified

Posted by Dennis Howlett @ 8:45 am

Categories: Uncategorized

Tags: Salesforce.com Inc., Sales Force Management, Sales, Dennis Howlett

Last evening, fellow ZDNet’ers Mike Krigsman, Dion Hinchcliffe, Tom Foremski, Brian Sommer along with fellow Enterprise Advocate Vinnie Mirchandani and I sat down with Parker Harris, co-founder Salesforce.com to get a deep dive into the rationale behind Chatter, what it’s really about and where it’s going.

In the above video (7 mins 5 secs), Parker talks about the problems of email and how Chatter can serve as a platform for collaboration, initially around the sales and service processes upon which Salesforce.com concentrates. As the conversation moved on, he also talked about how simply taking Twitter style feeds of itself is not enough and that that company needs to work on filtering and semantic analysis so that people are receiving the right data. This addresses the key issue of relevance around the infusion of social computing technologies into the more formalized structures of CRM (for example.) Salesforce.com is clearly in ‘thinking’ mode on this topic and will watch how customers use Chatter before making significant development investments.

It’s an enthralling conversation and one that provides excellent insights into how Salesforce.com is thinking about collaboration both in the short and longer term.

Disclosure: Salesforce.com met my travel and expenses to Dreamforce.

November 18th, 2009

Dreamforce 2009 - live

Posted by Dennis Howlett @ 9:17 am

Categories: Uncategorized

Tags: Dennis Howlett

November 11th, 2009

Epicor's implementation cost drive: what does it really mean?

Posted by Dennis Howlett @ 6:30 am

Categories: Uncategorized

Tags: Epicor Software Corp., Customer, Benefits, Roi/Tco, Outsourcing, Human Resources, Finance, Managerial Accounting, It Operations, Business Operations

Epicor’s announcement Monday that it has created a shared benefits program for implementations looks like a step in the right direction for those of us that want to see lowered implementation costs. On the face of it, the offer is compelling. According to the press release: “Upon project completion, if the project is under budget, the savings are shared 50/50. Conversely, if the project runs over budget, the customer is billed 50% of the contracted professional services hourly rates for all over-budget costs.”

Fellow Enterprise Advocate Vinnie Mirchandani, was quoted in the New York Times as saying:

“[With] many large companies I help negotiate implement contracts for, we try and include a bonus/penalty piece based on budget, time, customer satisfaction and business results,” Mirchandani said via e-mail. “So not unusual, but good to see a vendor proactively offer it.”

Ray Wang - another EA - was quoted in the original press release making the more general comment: “Software vendors have this opportunity to take their position of strength and demonstrate how they can provide customers value during a down turn. In doing so, they will help their customers succeed and earn customer loyalty and good will when the economy picks up.”

However, Frank Scavo yet another EA contacted me expressing concern that as it stands, the offer may lead to unintended consequences. He blogged that the announcement only addresses the cost side of the over all equation citing three potential problem areas:

1. Project manager’s lack of motivation to expend implementation dollars
2. Choice of consultants where a project is stressed
3. Focus on installation rather than benefits

Let’s step back a moment. During his Monday keynote, George Klaus, Epicor’s CEO was at pains to point out that customer service is a very big deal to the company: “We have to keep those upgrade customers because as you know it is far more expensive and difficult to acquire new.” In her keynote, Lauri Klaus, EVP worldwide consulting continued the theme (see pic above.) However, the move to Epicor 9, the only product the company is selling these days, is often non-trivial.

I spoke with the customer services teams who, this week, have been putting out a strong upgrade message. I was impressed with the depth of tools, techniques and services that surround the Epicor 9 methodology. But let’s be clear. It is a significant upgrade for those customers who or on anything other than Vantage 8. Dan Sirow, director at early adopter ICC told me: “It was easy for us as we were on Vantage 8. However, getting to Vantage 8 was a big challenge. We made the mistake - as many manufacturers do - of pretty much ignoring financials in earlier implementations. It was a major task to fix the problems. But once done, Epicor 9 was easy.”

Given the complexity of Epicor 9 and the myriad customer variations of current implementation, it is easy to see how customers might significantly under scope their projects. Indeed at one level I can easily argue that for many Epicor customers, version 9 is a step too far. At least for now. That’s not a criticism but a simple statement of fact about a product that is complex, demanding but could provide significant long term benefits. In order to better understand the situation, I spent time with Craig Stephens, VP Epicor consulting services. I asked him to walk me through the offering, addressing Frank’s points.

“We want customers to understand they have a critical contribution to make in projects. It’s a team effort where the customer’s effectiveness impacts us. Shared benefit (aka risk/reward) allows us to draw attention to this,” he said. Addressing Frank’s specific remarks, Craig said: “I would have thought that a fixed price  doubly incentivizes consultants to be in and out. That’s why although the impact is broadly the same, we advise customers we’ll agree a project budget.” I then asked about change orders: “We can deal with those a number of ways - perhaps decide to park on the side or incorporate into the same shared benefit arrangement, depending on scale and likely impact.”

On the matter of consulting quality, he had this to say: “We’re at the early stages of rolling this out and there is still work to be done with consultants to get them fully on board. It doesn’t make sense for us to put anything but the best consultants on a project that’s becoming stressed, otherwise we lose out and the customer will be unsatisfied. During the preparatory stages, we are a lot more structured to take advantage of what we believe are best practices for industry verticals. They’re not perfect but they’re a formalized way for us to provide certainty. We also talk early on about ROI and KPI goals. We’ve been piloting a more proscriptive method in the UK. That’s allowed us to shorten the amount of effort on the customer side though we still have about the same amount of effort on our side. We’re certain we can bring projects in at reduced TCO and improved ROI, the latter because the overall investment is lower.”

The devil as always is in the detail. On the basis of what I’ve seen in the standard implementation contract (but which I have agreed not to share publicly) I am satisfied Epicor’s public statements about the scheme are fairly reflected in what customers are being asked to commit towards.

This will not be the end of the story. As the customer war stories emerge, we’ll know whether Epicor’s aims and intentions are met in the real world.

Disclosure: Epicor settled my travel and expenses to the conference.

November 11th, 2009

SAP and open source: it's about Oracle

Posted by Dennis Howlett @ 2:35 am

Categories: Uncategorized

Tags: Oracle Corp., SAP AG, Matt Asay, Open Source, Dennis Howlett

Matt Asay has written a piece about SAP’s ’sudden’ love affair with open source:

What is surprising is that it is SAP, the bastion of proprietary software, that delivers this message.

Irony, thy name is SAP.

SAP, after all, is hardly the most open-source or open-process friendly company on the planet. Despite early involvement in Eclipse, some interaction with MySQL (MaxDB), and a new commitment to the Apache Software Foundation, SAP remains a firmly proprietary company.

Dude - IT’S ABOUT ORACLE. The big clue comes in the quote in Matt’s piece from Vishal Sikka, SAP’s CTO where he says:

To ensure the continued role of Java in driving economic growth, we believe it is essential to transition the stewardship of the language and platform into an authentically open body that is not dominated by an individual corporation.

Matt added the emphasis but didn’t spot it. Truth is SAP is scared witless about Oracle’s intentions regarding Java once they (presumably) acquire Sun. As I understand it, the way the T’s and C’s are written for Java in commercial environments, Oracle has or could have a right to charge for the SDK, an essential piece of the Java puzzle for big vendors like SAP. Oracle already benefits to the tune of some $1 billion a year from SAP being an effective Oracle DB reseller. Adding in the pain of $??? for access to the SDK would stick in SAP’s craw.

I can imagine Oracle would be delighted to invoke a charging clause. Especially if it meant sucking more blood from its arch rival. Heck - it beats filing law suits.

More seriously, if Oracle could and did levy a charge, SAP would have no real way to pass it on to customers. It’s open source innit so in the minds of buyers anything SAP has to deal with becomes a cost of IT doing business.

SAP could argue cost increase ergo pass it on but then that runs counter to Sikka’s charm offensive and risks SAP truly living up to the ‘pot, kettle, black’ monker Matt applied to the article. But there is another side to this.

SAP has been trying to get the influential SAP Mentor group onside with open source. That’s probably one of the easiest tasks it has. Geeks love open source and care little for commercial issues. And the Mentors are extremely good geek advocates for what SAP does. Marketing wise it’s an internal SAP community slam dunk for SAP. But…SAP has also made clear that IT doesn’t believe open source means ‘free.’ Mentors may not be concerned about that from a development viewpoint but I’m pretty darned sure they’d get antsy if the license bills came at deployment time.

As an aside, I have practical experience of running the SAP IP gauntlet. If SAP is truly committed to open source then this will relieve a lot of the pressure on developer groups. However, that’s not a certainty.

I note that Matt is presenting to SAP later today. I hope he has time to read this. It might give him something to consider?

November 9th, 2009

Fidor Bank: a glimpse to the future?

Posted by Dennis Howlett @ 6:00 am

Categories: Uncategorized

Tags: Bank, Germany, Fidor, Banking, Financial Services, Finance, Dennis Howlett

While at the SOMESSO event last week I filmed Matthias Kroner, CEO of Fidor Bank. In this 9 min 43 sec video, Matthias explains the difference between the classical bank and the new form of community based bank.

Fidor is the first bank of its kind to have obtained a full banking license in Germany. This allows it to operate throughout Europe since regulation ‘travels’ across borders. As a virtual operation, this gives Fidor immediate and direct access to a market of 350 million people. Today, operations are restricted to Germany where it is building out and testing different services.

What makes Fidor unique is that to use Matthias’ words: ‘It is the people who are the bank.’ It will be interesting to see how this concept develops. For example, will it be able to compete with traditional services that include online banking, ATM access and safety deposit box facilities. Right now, Matthias says he is going after the mass market retail banking segment.

Having spent an entire article calling out Enterprise 2.0, it is good to see an innovative example of how community can be turned sideways to create a new business model that offers genuine differentiated value.

November 5th, 2009

Gartner wins in ZL lawsuit: but is it a pyrrhic victory?

Posted by Dennis Howlett @ 9:49 am

Categories: Uncategorized

Tags: Lawsuit, Gartner Inc., ZL, Dennis Howlett

Just in. ZL lost in its lawsuit over Gartner Magic Quadrants. It has issued this statement:

“ZL believes that Gartner’s overwhelming influence on large corporations’ purchasing decisions, and its inaccurate ratings, including its bias in favor of large vendors, combine to pose major competitive hurdles that hurt smaller innovative vendors across all technology sectors.  The harm falls not only on new and innovative companies like ZL, but on the enterprise customers who receive faulty purchasing advice, and as a result overspend on inferior technology.

While we are disappointed that the court has dismissed our lawsuit as filed, we are pleased that it has given us leave to amend our complaint, over Gartner opposition. We believe the market should take note that the defense on which Gartner prevailed was its argument that its reports contain “pure opinions,” namely, opinions which are not based on objective facts.  In ZL’s view, that is directly contrary to the statements Gartner makes to its customers when selling its allegedly sound research. ZL intends to amend its complaint and refile within 30 days.”

It looks as though this one has at least one more round to go.

November 5th, 2009

Twitter and web forgery

Posted by Dennis Howlett @ 6:35 am

Categories: Uncategorized

Tags: Web, Password, Twitter Inc., Robert Scoble, Security, Dennis Howlett

Last evening as I was winding down after a long journey imagine my surprise when I started to receive a tsunami of @ replies on my Twitter account. Apparently I was direct messaging a stack of people I don’t know with a link to something that starts http://videos.twitter… except it wasn’t me. The image above is what you see when the link is clicked (and no, I’m not going to give the link.) This is NOT fun.

Fortunately, Robert Scoble had picked up on what was gong on and sent the message:

@Scobleizer: Don’t click links sent to u in DM @dahowlett & many others are being hit ESP ones that start http://video

At the time I wasn’t near my iMac or laptop so couldn’t realistically review the problem. There are limitations to Tweetie on the iPhone. I did send a Tweet message to @ev screaming HELP!!!!

@dahowlett Holy crap. This hacking thing is teh suck. I’m getting bombed. Anyone who gets DM from ‘me’ with http://video. IT’S NOT ME @ev? HELP!!!

In time honored fashion I didn’t get a reply from anyone at Twitter. Given the nature of the service I didn’t expect to. I’m not the only one - see the image below taken from Scoble’s account:

Fortunately I’ve got a number of good pals who contacted me with various suggestions as to how the problem might be solved. The favorite seemed to be a password change. I’ve no idea how the hack occurred, especially given I used a 10 character alpha-numeric password that Twitter graded as ‘good’ but it is yet another example how this popular service can catch people out.

Scoble and I may not see eye to eye on a number of topics but I was grateful that he warned people about what’s going on. I called him up to see if he could shed light on the problem. Unfortunately he couldn’t and, as you can see from his Tweetstream, it doesn’t seem to have been addressed publicly by Twitter. Trending articles don’t mention it either. However, I did notice that Twitrobot’s account has been suspended.

One very helpful suggestion was to ensure the password you use for Twitter is unique to that service. That’s something I’d done anyway so it seems that at least one service I use has either been hacked or is being used for less than honorable things. I’ve since revoked access to several other services.

According to Dan Goodin at The Register, the problem could lie inside OAuth:

“Unless you revoke these [Twitter add-on app] tokens when you change your password, a malicious user will still have access to your twitter account,” said [Terence] Eden, who tackles customer usability issues for a large telecommunications company. “Twitter doesn’t make that wonderfully clear.

Whatever the problem, it amply demonstrates what can happen when a vendor doesn’t police the use of an open API. This is something I’ve talked about elsewhere, much to the derision of vendors who would like to think I ‘don’t get it.’ I trust they’re eating their words. Security matters and a laissez faire attitude to APIs will surely destroy reputation faster than Luke Skywalker’s light saber.

November 5th, 2009

Enterprise 2.0 - the non-debate

Posted by Dennis Howlett @ 4:02 am

Categories: Uncategorized

Tags: Benefit, Enterprise 2.0, Dennis Howlett

If I’d paid the full whack $2,495 to attend the Enterprise 2.0 conference I’d be demanding at least a partial refund. It seems the ‘Enterprise 2.0 - what a crock’ debate was less than a damp squib and more like a feeble whimper. Here’s the back story:

In August I wrote:

Therein lies the Big Lie. Enterprise 2.0 pre-supposes that you can upend hierarchies for the benefit of all. Yet none of that thinking has a credible use case you can generalize back to business types - except: knowledge based businesses such as legal, accounting, architects etc. Even then - where are the use cases? I’d like to know.

Susan Scrupski asked me if I was going to attend Enterprise 2.0 and would I participate on the panel. Given what I had already said and after I stopped laughing, the answer was an emphatic no. Why would I waste my time listening to a bunch of talking heads trot out the same claptrap I’ve been hearing the last several years? It seems the panel didn’t disappoint my lowly expectations. This is what one attendee said of the debate:

They delivered some interesting, but disappointingly similar-sounding, defenses of how technologies like blogs, wikis, and social networks can benefit big companies. The panelists said that one of the hurdles to convincing enterprise-scale organizations that these new tools are worth their money is the difficulty in quantifying the business benefits. It’s hard to calculate an exact return on investment when it comes to better collaboration: “When somebody figures that out, they’ll make a million,” said Greg Lowe, social media architect and program manager at Alcatel

On the Twitter back channel, Nenshad Bardoliwalla told me:

Your presence here at #e2conf is very palpable.  They had a whole panel to answer your question on value, and failed MISERABLY.

Very flattering Nenshad but is that The Ghost of Christmas Future?

Why am I not surprised? I’ve argued for years that the notion of anything that has ’social’ attached to its moniker is about as welcome as breaking wind in a spacesuit. I’ve also argued that I’ve never heard anyone ask for some Enterprise 2.0 though I’ve heard plenty ask for ERP, CRM etc. Most recently, the new buzz phrase ’social business design’ has hit the streets. Here’s one definition:

Social Business Design is the intentional creation of dynamic and socially calibrated systems, process, and culture.

Its goal: helping organizations improve value exchange among constituents.

Good luck with that one.

Perhaps the panel would have done better had they taken a leaf out of Andrew McAfee’s book. In his presentation about Enterprise 2.0 no-no’s, he says:

Like too many words in the English language, ’social’ has taken on a handful of different meanings. Though most would probably agree that technically it’s an accurate word when used to describe various enterprise solutions, the implications are not always desirable.

“I have never come across a word that has more negative connotations to a busy pragmatic manager,” said McAfee, explaining that he’s seen many-a-boss assume that ’social’ tools wouldn’t help anything but employees talk too much and goof off.

Though McAfee didn’t suggest a new or better word to use (collaboration? communities?)  he finished the presentation with an interesting image choice to illustrate how some managers interpret the use of ’social’ solutions: two dirty hippies hugging it out at Woodstock, surrounded by litter and despair.

[My emphasis added]

At this point I must give Andy McAfee full credit for acknowledging the bleeding obvious. Isn’t that what I’ve been saying for years? The problem for those trying to pimp this stuff is they’re now stuck with two things: ’social’ intermingled at every turn because no-one can think of anything better and 2.0 which roots them at a moment in time. It’s a classic example of bandwagon marketing that looks sexy yet has gone nuts in the process. Crowdsourcing at its worst.

I find it amazing that despite the relentless spin on this topic, it seems the challenges of changing culture take the hand wavers by complete surprise. The only conclusion I can reach is that none of these people has done any significant work inside organizations or if they have then they haven’t a clue about how business is organized, how the moving parts operate, how business cultures develop or what motivates people to work. If true then they are either charlatans or dim witted.

What I find staggering is that despite the panel’s general acknowledgment that ‘it is early days’ they have no clear answers for solving the problems that Enterprise 2.0 evokes. If this is the best that industry can put forward then forget it. There are far bigger problems to solve like correctly managing the workforce in times of economic crisis, smoothing out lumpy supply chains, beating down on data center costs or just getting ERP to deliver the benefits that were intended and which have consumed billions of IT spend dollars.

For those interested in such things: here’s a blow by blow account of the Enterprise 2.0 debate from Timo Elliott. I was nodding off to sleep after the first couple of answers.

UPDATE: at least one attendee was less than wowed:

I spoke to a few large companies (that will remain nameless) in private that were brutally honest with me about how disjointed their departments are and they honestly don’t believe that their organizations are not going to make this change, how can they?  I feel like the E2.0 panel I’m watching right now is so watered down that it’s almost pointless; it’s just not reality.