July 2nd, 2009
Saas? We're too busy making ERP work
It’s sometimes good to be reminded that while the industry hype is around saas/cloud/on-demand that there is still another world out there where customers are wrestling with more traditional approaches to computing.
The other evening I had a conversation with Erick Kimberling, CEO of Panorama Consulting. Panorama is a rare beast. It gives away 80% of what it knows in a steady stream of data driven reports, webinars and thought pieces over on IT Toolbox. It’s a smart go-to-market strategy for a small analyst cum consulting operation and is only a gnat’s whisker away from being in the open source mold that Redmonk favors.
While the ERP players’ app sales are in the toilet and the traditional SI’s scramble for work, Panorama is busy: “We were unclear about 2009 coming into the year but so far we’re 80% up on 2008, which was a good year anyway,” said Kimberling. 80%? Are you kidding me? Not at all. Panorama gets involved in software selection and price negotiation - and here Kimberling reckons that discounts are heading 20% north of what’s usually possible. That’s no surprise - I’ve seen that myself - and more in some cases. (Investment watchers take note.)
Instead, Panorama helps companies with their implementations in an effort to avoid becoming one of Mike Krigsman’s case studies. Equally important, Panorama works to try bring those projects in on time and to budget. That’s where today’s rubber hits the road. “There’s no doubt that CIO’s are under tremendous pressure to deliver. They just don’t have the luxury of over spends and under delivery in this economy,” said Kimberling. I suspect that even when things do return to more favorable conditions, companies will have learned valuable lessons about how implementations should proceed and where value can be extracted.
On that point, it is interesting to note Kimberling’s explanation for failed projects. He argues a different kind of Devil’s Triangle. While Mike Krigsman concentrates on the relationship between vendor, consultant and implementer and buyer, Kimberling talks about:
- Making the wrong software choices and force fitting solutions
- Setting unrealistic implementation targets
- Failure to manage scope and duration
The two sets of theory are not mutually exclusive but complementary to one another.
I asked whether there is pressure to look at the burgeoning saas/on-demand market: “We’re dealing with what you might call traditional ERP but I can tell you that the saas hype which is really a follow on from the old ASP model, is nowhere near the reality - at least not in the cases we see. Sure, in 3-5 years’ time we may be seeing more but where is the saas company that’s going to beat an Oracle or SAP out in a large scale ERP deal today?” It’s a good point though I’d argue that in the mid-market, NetSuite has been doing a credible job, even in a tough economy.
Of course nowhere in our conversation did the other buzz expression ‘Enterprise 2.0′ turn up. As Kimberling alluded, his customers are far too busy getting their projects to work on time and to budget. Thank goodness there is at least one person out there prepared to look at the world in a realistic fashion rather than the rose colored spectacles some of us are prone to wear.
Dennis Howlett has been providing comment and analysis on enterprise software since 1991. See his full profile and disclosure of his industry affiliations.
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| 07/02/09
