I am honored to be part of Bill Kutik’s 7th annual videocast about trends in enterprise software, especially around HCM and Financials. Sponsored by Workday, I will join Naomi Bloom and Brian Sommer live on December 16 at 11 am pacific from Palo Alto, CA.
If you have seen the four of us on panels, you know we can be interesting, informative and sometimes, infuriating
This year there will be plenty of factoids and forecasts on cloud trends, Big Data opportunities and changing implementation models.
Look forward to your participation and questions. Registration Details here
Howard Street in San Francisco on Tuesday morning looked different. The tarmac was visible and cars were actually using it. Outside Moscone Center, a local folk rock band, Blind Willies was playing. Excellent, but nowhere near the brand recognition of say, Aerosmtih or Will.i.am. Inside Moscone, the rooms had plenty of empty seats.
Welcome to Workday Rising. It was tough to miss how low-key this event was compared to Dreamforce and Oracle OpenWorld over the last few weeks.
The energy was all in the customer interaction.
An executive from Equifax gushed about the bi-annual upgrade process - how painless it is and just as importantly the comfort he got from the fact that his peers were testing the same release at the same time, and how he could benefit from the wisdom of that crowd. He echoed a phrase co-founder Dave Duffield likes to use - “The Power of One” as in having a consistent release across the customer base
An executive from HP described their HCM project which touches over 300,000 employees across the world. He described delivering that in just 14 months as the equivalent of “winning the Super Bowl”. He said he is now looking to a similar victory on a just-as-complex project as HP moves to split itself in two.
Stan Swete, CTO told analysts a few weeks ago “Customers don’t want to be bothered with the details of the infrastructure used to support their operations, but they do want the assurance that their vendor will be able to evolve and not get stuck on outdated technologies.” At Rising, Aneel Bhusri reported 99.95% uptime – deliver that and most customers will not want to be bothered with details of the infrastructure.
A customer described their relationship with Workday as “vivacious”. Have you ever heard someone describe their enterprise software vendor that way? It shows in the 97% favorable customer rating Bhusri shared with the audience.
Chapter 1 of my book on the SAP economy begins on February 23, 2008. It says “When the history of technology is written, it will, however, honor the 54th day in 2008 for a meeting which would change the trajectory of enterprise computing.”. My book will be out in a month and you can see what I mean but let me just say it has something to do with a large, early Workday customer. As I walked out of Moscone this week, I was thinking of a comment Dan Beck made in a one-on-one. He leads the Data Science team and presented on a series of Insight Apps (like on Retention Risk and Collection Scorecards) in the morning. He said a customer approached him afterwards and told him what he saw got him as excited as their early experience with cloud computing at Workday.
I am fairly confident that will be more fodder for another book in a few years. Low-key conferences are just fine.
Mike Ehrenberg, CTO for Microsoft Business Solutions was describing his new CEO Satya Nadella’s management style – the senior leadership team meets twice a week. “It plays havoc with planning international trips, but allows us to iterate rapidly as a company”
Kirill Tatarinov, EVP of the Business Solutions group says they have moved from Steve Ballmer’s “hub and spoke” management style to much more of a “connected tissue”. It’s allowing Microsoft to evolve to a “single P&L”
Sidebar conversations during the Fall Analyst Event this week showcased the evolution of “One Microsoft” that I had described here. I like to write about Polymaths and Microsoft is a formidable one with competencies in
High Value Apps
Consumer/Enterprise (comfort with both)
Of course, analysts like to carve the market into neat acronyms, and most customers still buy discrete pieces of technology, so the event mostly showcased Microsoft Dynamics ERP and CRM customers and product evolutions. In a q&a, Satya invited us to keep reminding Microsoft about the broader opportunity and under non-disclosure we heard of newer examples similar to Delta where Microsoft had pulled together retail, mobile, cloud technologies to deliver their in-flight POS
What was nice was even the ERP/CRM customers who presented during the event reflect a “New Age” economy:
Trupanion– provides pet insurance and their actuaries use Big Data to price premiums by breed, age etc. I hope to profile them on New Florence after a call with one of their data scientists
KEXP – a non-profit radio station in Seattle which invites new bands to perform live (an impressive list including Nirvana and Death Cab for Cutie to Shovels & Rope and Macklemore & Ryan Lewis) talked about how Youtube has expanded their audience and funding sources beyond just the local market.
True Blue – a temp agency described how texting and other mobile technology is reshaping blue collar work assignments
Microsoft Retail – described point of sale and other innovations they have pioneered in over a hundred stores and how that feedback has helped evolve omni-channel industry features in Dynamics
Carrefour –the grocery/retail industry is evolving with same day delivery and a new set of tech savvy competitors
Another changing marketplace is that of IT services. Microsoft showcased a spectrum of 6 partners ranging from $ 28 million in revenues PowerObjects to ABeam Consulting ( a SAP SI strong across Asia which is doing two-tier Microsoft projects) to $ 100 billion revenue-strong IBM.
Microsoft has invested significantly in lifecycle management tools around its applications and it was interesting to see the enthusiastic attitude about these tools from the smaller partners compared to that of the bigger ones.
Microsoft sells Office and other tools to white collar workforces but it has also seen massive scale efficiencies from machine learning and cloud infrastructures. Satya responded to my question saying he wants customers to “become software companies” by creating unique, differentiating code and reducing labor needed for back office functions.
That is the another major opportunity and challenge for Microsoft: to prevent a repeat of what bigger SIs and offshore firms did in creating a massive labor intensive economy in spite of SAP’s ASAP , Solution Manager and other tools and methods.
All in all, an invigorating couple of days on the shores of Lake Washington. As a dog lover, I particularly liked the Woodmark Hotel’s resident pets and Trupanion bringing two canine panelists to their session.
I hope to profile some of the newer “One Microsoft” customer examples on New Florence as soon as the non-disclosure embargo is removed.
Dreamforce this week had an even more festive feel than ever. Pennant fever gripped the town as the Giants played October ball. The Beach Boys sounded as youthful as ever during Benioff’s keynote. The many school kids invited in the keynote audience and Hillary Clinton’s talk of babies provided an even more youthful and optimistic tone.
It was good to see visions of next-gen customer service featuring Honeywell’s internet of things thinking and Coca Cola drone deliveries. Digital agencies, social marketing, customer analytics, and communities were the talk on the expo floor and in many a session.
I had excellent conversations with Salesforce partners like FinancialForce and Kenandy and their customers. It is good to see robust transactional functionality mature on the Salesforce platform.
And yet I left with a bit of an empty feeling
I am haunted by my summer research for the book on the SAP economy. So many of the SAP customers I interviewed asked me why there are not many robust cloud offerings for their industries. Not just spray painted features – deep retail merchandising, utilities billing, electronic medical records, pricing/promotions/assortments for CPG markets. insurance claims processing and on and on.
Last week, I was reminded what Bill Ruh at GE told me during one of interviews: “we are transitioning from IT to OT – as in Operational Technology”. At GE’s Minds+Machines event everywhere you walked there were constant reminders of operational metrics that companies are monitoring and optimizing - ionizing radiation doses, optimal pitches of wind turbines, granular in-flight data and on and on. It’s what CEO Jeff Immelt calls the junction of “physics and algorithms”
At Dreamforce I walked by TCS booth with reminders of its 300,000 consultants, and Deloitte Digital with its own armies. Time for them and other IT vendors to help evolve clouds beyond finance, HR and CRM functionality.
Salesforce, Workday, NetSuite, Amazon and so many others have done an amazing job over the last decade. But we need to raise the bar for clouds. Not only because thousands of SAP on-premise customers beckon, but even bigger optimization opportunities are screaming for attention in so many industries.
I have written before Oracle’s biggest cloud differentiation is it can play in all three layers – application, platform and infrastructure –as-a-service. Larry Ellison’s talk last night expounded on that as he spent time on each layer. But in many ways he set the stage for several questions I hope get answered during the course of the conference
a) How deep are the vertical cloud apps?
Larry presented two slides covering various industry applications – I show one below. But he glossed over them. That’s actually more exciting than HCM, GL or SFA functionality which has been “cloudified” for a while now – as Larry pointed out Salesforce.com has been around 15 years. I hope I hear more about vertical clouds.
b) How does SaaS leverage the IaaS?
Larry pointedly said with Oracle’s SaaS leveraging its PaaS, customers have a robust customization platform unlike competitors who he said offer just “a few buttons”. Frankly, Oracle’s just-as-big opportunity may be to pass along the economies of a massive data center cloud. Like to hear if they plan to. Like to hear if they are helping current EBS, Peoplesoft and other incumbent customers already lower their hosting costs with their IaaS
c) What migration tools is Oracle making available?
One of the big gating factors for many customers is the cost of data migration, integration, testing and user retraining that comes with the move to a new application or platform. Hopefully Oracle has thought about automation, not just opening up another market for systems integrators to sell more services.
d) How is the Buy and Build integration going?
Larry repeatedly acknowledged Oracle continues on an organic/acquired path as it has for a while now. The digestion of acquired applications takes way too long in our industry – Oracle has more experience with such integration but it still takes them years. Has Oracle learned how to speed this process?
e) What is the “pull” for incumbent customers?
I have said before Applications Unlimited was a brilliant Oracle move. But it has frozen its customers in place. What is the pull in the Oracle cloud to offset the massive appeal to just stay in place?
Look forward to learning more during the next few days.
“..in some ways he wishes the larger vendors would be there today. There are common engineering and plumbing challenges every competitor hits which are useful to share experiences around. It would be good for the industry.”
At the Workday Tech Summit this week, in talking to several of its executives, I got a very different vibe. They are not looking for such guidance from other enterprise vendors as they scale volumes not seen in cloud transaction processing world – a billion (complex financial, payroll etc) transactions a month, ledgers which scale to 200 million journal lines etc.
They are increasingly turning to the consumer web for guidance. Whether it be planning for availability zones, disaster recovery, denial of service or exabytes of data there were repeated mentions of Amazon, Google, Apple, Yahoo!, Netflix and others. Interestingly, the biggest competition for development talent is also coming from the consumer web.
There was a subtle confidence – and yet humility - when David Clarke led a session about how “complex systems are always broken”. He described simulations crews undertake on a cruiser called MS ANTWERPEN and how they react to varying degrees of emergencies.
Workday is extremely successful and they could easily have spent the day gloating, but I quite liked the paranoia that came through in many of the presentations and side conversations.
The reality is Workday is at a juncture. They can continue on their path of financial, HR and analytical product leadership. Or they can expand into many new industries and countries.
The temptations are many. As part of my SAP Economy book research I had several CIOs ask me if/when Workday was likely to expand into their industries. I spoke to a small sample. You can imagine the extent of requests Workday executives are getting directly.
Aneel Bhusri, CEO and his execs are being very measured. Partly, they bring some gating memories from PeopleSoft world where vertical and geographic expansion was uneven. Partly, the culture is modest – not given to hype or overreaction.
Either way – whether they stay on current path or they expand into new sectors- the effort they are putting into scaling and fortifying the infrastructure is commendable.
Unlike previous Tech Summits, this was a relatively quiet one. But it was set in the stunning setting of the Presidio. There was a “speak softly, carry a big stick” feel with artifacts of military history all around us.
Yes, Workday has matured into a thoughtful, if quiet, enterprise cloud leader.
I have written in past about Infor’s micro-vertical strategy and its quest with its internal design agency Hook +Loop to make enterprise software “beautiful”. I saw more of that at Inforum in New Orleans this week, but I also signs of the messages maturing more into a focus on efficiency and value from software.
To start with, it is good to see an application vendor talk feature/function and business process, not just platforms and speeds and feeds. I spent time at the event with customers and Infor execs from healthcare, hospitality and fashion. Transactional systems and analytics to optimize revenues and operations. The analytics focus was particularly pronounced with pretty visualizations, but even more of a focus on predictive analytics with MIT data jock class talent in its “Dynamic Science Lab”
Not just verticals, there was more in what Infor calls “Corporate”. A new General Ledger for the global, multi-entity, multi-calendar world we live in. Expanded HCM footprint with more analytics around workforces.
And new CRM functionality with a recent acquisition, SalesLogix. New discrete PLM functionality via a partner, Aras to add to process PLM Infor offers via its tool Optiva.
To me, it was more exciting to see a focus on value from software – coming at the heels of my summer writing a book about the bloated SAP economy.
Infor has taken a leaf out of the SAP sales playbook and has a Value Engineering team which focuses on payback analysis. What’s different is it is also showing up in efficiency in UX. Infor talked about a paradigm it calls Clear Work and the goals are improving appeal to users, but as important to increase productivity, to decrease errors and to decrease training time. It talked about attacking the “tyranny of the super user” – simpler functionality so organizations don’t become dependent on a handful of individuals.
The Value Engineering impact is also being felt in payback analysis across vertical processes with several examples like one below:
CEO Charles Phillips has been quoted as saying “Friends don’t let friends buy data centers”. There was significant talk of Infor’s commitment to Amazon Web Services for its cloud infrastructure. Why not leverage the biggest “super computer” with auto-scaling, Redshift, cloud trail and many other services to the benefit of your customer community?
The partner expo was full, but not ostentatious – nothing like the 2,000 square foot booths and 22 foot tall signage at SapphireNow. Many of the partners are regional and industry specific like Ciber and Stoltenberg. Most are low-hype and operationally focused. The latter is particularly important as most Value Engineering payback is in the operational areas not as much the “corporate functions” which many services firms do better at.
Overall, Infor’s wide product, services and talent portfolio continues to grow. Many analysts find Infor difficult to categorize. Infor plays to many three letter acronyms but it is always breaking into new ones.
Charles described a call from an executive of a Commercial Real Estate company asking if he would be interested in developing functionality for their micro-vertical. At other vendors, they would be lucky to get a call back. Charles’ response “we will be glad to analyze the market and if we can find a group of charter customers, sure we will”.
Oracle invited me to moderate a panel in their DaaS launch today. Watch the whole hour for some great perspectives on this exciting new market category, and our panel starting around 26.00.
Talking to Steve Miranda and Omar Tawakol before and after I got even more excited about the concept
a) There is a new generation of data asset entrepreneurs like Omar (whose company, BlueKai Oracle acquired) who are about separating signal from noise– under NDA I have been briefed by other entrepreneurs focused on supply chain, HR and other DaaS. Scary smart folks.
b) Watching Omar talk about all the social and other marketing data feeds, Steve talking about feeds from machines and wearables, you realize we are not anymore in the Kansas of internal, structured data so many companies are still heavily invested in
c) How rapidly business and deployment models are changing. While the old model of “buy hardware, install software, load data, clean for quality – pay for all that” is not going away the speed of getting started with and the economics of DaaS are going to be compelling
d) How effortlessly Oracle with its decades of data management experience and horizontal and vertical application knowledge could play in a wide range of DaaS categories.
I asked Satya Nadella at last Fall’s analyst summit why Microsoft had been slow to leverage the multi-billion $ investment in Azure infrastructure (I had first written about the innovative data centers in The New Polymath in 2009). He seemed a bit taken aback by the question and said Office365 was one of the most successful cloud applications in the market. I clarified I meant VARs and ISVs and customers were not using it more as an IaaS. So on the announcement with Salesforce last week, I thought he had scored an IaaS coup. The announcement was more modest – about integration of Salesforce with O365, availability of Salesforce1 on Microsoft mobile – but still a coup.
In a few short months as CEO, Satya has been emphasizing “cloud first, mobile first” philosophy quite a bit and showing a willingness to work with several leading industry players. Behind the scenes, that means he is breaking down silos within Microsoft and he is also redefining “co-opetition”.
Take the Office for iPad announcement. For years, earlier tablets from HP and other Windows partners faltered because of lack of Office availability and the related lack of appeal to corporate users. To do so with Apple shows how far Microsoft has come. And yet its own Surface offering keeps getting better (version 3 has some really attractive features as a hybrid laptop/tablet). Think of the competition implications for Apple and Win OEMs a couple of years from now.
Or this week at Sapphire, Azure will get play as an IaaS play for SAP. The bigger opportunity for Azure is to replace the highly inefficient hosting IBM, HP and SAP partners have long provided its on-premise customers. At the same time, Microsoft Dynamics continues to be a viable “2 Tier ERP”’ option for many global SAP customers. More frenemies.
With the Salesforce announcement, Satya likely had to soothe his own CRM team. It has been growing its footprint considerably especially around Marketing functionality and its ability to leverage its Bing product and agency relationships.
On a whale watching trip this weekend, our captain told us all his competitors share a radio frequency where they tell each other about whale sightings. They also use congregations of seagulls and rhinoceros auklets as signs of “bait balls” whales chase. The key is getting to where the action is, then alert crew and tourists are the ones who actually see the whales as they move about quickly and come up ever so briefly. Satya’s using the same principle – work with leading competitors to get to where the action is. Then let the alert, adept win.
His track record will make for a nice book a few years from now – “Co-opetition 2.0”
We are still a long ways from where the Apple CEO shows off a new product and the supply chain and partners have long been working on it and several million units and related apps are delivered to customers within weeks. In enterprise world we still have way too much “vaporware” – product announcements followed by years of development then years of customer adoption.
But progress is being made. Most SaaS vendors have multiple releases a year and can migrate customer bases within days. I was pleased to hear Workday announce today it had developed its Recruiting product with 7 decent sized early adopter customers, and another 70 customers have announced they are adopting it, and Workday expects the majority of them to be live after 4-6 month implementations.
We still have a long way to go to the consumer delivery model both in terms of speed and unit volumes but good to see at least some progress.