deal architect

Heart of the Matter

Don Henley starts his hit on YouTube with the comment "it took 42 years to write, 4 minutes to sing"

As Oracle kicks off its "100 days of innovation", I hope they like Don have spent the last few years writing the code, not just starting to.

Because it sure seems like they have been more intent on dazzling Wall Street with squeezing margins from acquired products than delivering new product and innovation to customers.

As Bob Evans says in InformationWeek

"as sweet as those numbers are to Oracle -- and to the financial analysts and investors who are rewarding Oracle's terrific bottom-line performance in this brutal economy -- they might or might not be as sweet to the folks paying those annual fees."

I would go further - it's time for Oracle to start singing to its customers

"...forgiveness, forgiveness ...even if you don't love me any more"

Let the market speak

I knew I would rile folks by contrasting poor delivery in the enterprise software market to the explosive growth of 50,000 apps in the iPhone ecosystem. Sure enough in the comments several people talk derisively of those apps and how much more complex enterprise apps are. Of course, many of the iPhone apps are juvenile.

But even in enterprise software 20% of features deliver 80% of value. So do we mock underutilized features?

In the iPhone ecosystem, the market will drive worthless apps into oblivion. In enterprise software, poor customers continue to pay for worthless features because they are part of the “standard release”, and then pay for upgrade after upgrade of a mountain of those features.

It could change with SaaS. Those vendors get real-time visibility on which features are most utilized by their customer base and where to continue to make investments.

But even there be it would be nice to have customers vote for features with their dollars, as they will in the iPhone App Store.

The dog days of SOA-mmer

Expect to hear lots about SOA and middleware next few weeks

• Oracle is launching its Fusion Middleware 11g July 1
• On its Flex call this week, I heard Infor invoke SOA several times
• Software AG announced webMethods 8.0 today – more SOA enablement

So, puzzled with this renewed focus on SOA I thought I would ask folks who know about hot days – Mad dogs and Englishmen.

I turned to the Englishman, Dennis Howlett who recently had dinner with folks from Tibco and probably heard SOA a few times. Dennis’ speculation “the promise of SOA was always about re-use and lower cost...I'm guessing that since that's top of mind these days?”

I turned to my beagle, Peanuts. He longingly looked up to the clouds, panting in the heat.

I suspect many customers also are - at SaaS and amazon type of clouds for truly lowered costs

Two ways to deliver a billion lines of code

I know someone who I believe is destined to write a coffee table book on Big Software. He idolizes big, game changing software over the decades like DB2, NT, SAP R/3 as others do with artistic masterpieces. Like a proud brew master he talks of software as "craft". When we talk, we usually argue. He thinks I am too hard of the "craft" of making software. Nothing good comes quick, cheap. My software quality points are trivial etc etc.

It’s time for me to call him for our periodic argument. Dennis Howlett outlines the meandering ways of BusinessByDesign at SAP. I am sure there are other catalogs about what went wrong with MS Vista and is going wrong with Oracle Fusion. In each case 5+ years or so of effort and billions in R&D.

Contrast this to the Apple App Store – 50,000 applications in just over a year. Which in turn is putting pressure on Nokia, RIM and others to develop similar apps ecosystems. 

Is the difference enterprise complexity? Is it the fact that Apple has mostly done it with an ecosystem of young, hungry entrepreneurs? That most of these entrepreneurs get micro-financing - most in the low 5 digit number funding?  Or that in contrast most enterprise software companies hang around other laggard software companies and outsourcers and hosting companies?

Whatever it is, there is definitely some game-changing stuff going on in the industry .

I cannot wait to call Mr. Big Software for our periodic argument :)

Can you make it any cloudier?

Tom Wailgum at CIO interviews Vishal Sikka, CTO at SAP.

And he talks about not 1, not 2, but 4 SAP “clouds”.

His Cloud 1 appears to be the mainstream SAP product today. Cloud 2 is what John Wookey described last week in Amsterdam and I called SAP’s “moat” strategy. Cloud 3 is BusinessByDesign which is the “bear” I think we heard about at Sapphire.  Cloud 4 has more to do with infrastructure - compute and storage capacity.

Why even talk about 1 which would fail so many “It’s not a cloud if…” filters?  Or 4 which is around SAP data and transactions but the infrastructure services are being provided by parties like HP and amazon?

Now Vishal is one heck of a smart guy – has a Ph.D from Stanford. But seriously how many SAP sales folks will be able to present all this cleanly?

And remarkably, in a long interview there is little mention of any significantly improved economics, or speed of provisioning, or turning fixed IT costs to variable – I mean those are the exciting elements of cloud computing. 

Instead it’s all about how complex SAP customers are and need mission-critical support or people can go to jail etc. Sure that will get prospects excited.

Just below the interview with Vishal is a link to another article “The Case against Cloud Computing”.

Touche.

SAP SaaS pricing for incumbent customers?

As a follow up to my note “Will the real SAP SaaS please stand up?” I saw an interesting comment in the latest research from Ryan Hunter of Wedge Partners

“SAP customer sentiment is already in a fragile state (Vinnie comment: Because of SAP’s announced plans to increase maintenance rates even as third party options provide mature customers far lower prices) and we believe that customer reaction to this announcement could prove negative as more details come out.  Add-on applications like those described in SAP’s announcement are a common tactic that enterprise software vendors use to extract additional license fees from customers that are already paying maintenance fees on larger applications.  We think that existing customers could feel entitled to receive the new functionality enabled by the SaaS add-on modules and may reject this latest initiative.”

Fair to say SAP will owe the market some Clarity :)

Will the real SAP SaaS please stand up?

I have nothing but respect for John Wookey, and I urge you to read analysis from Phil Wainewright and Dennis Howlett who are at the SIIA conference in Amsterdam where John just presented his vision – but this InformationWeek  interview with John about SAP SaaS left me confused:

“Here's what SAP customers can expect in the coming months: function-specific software applications, available by subscription, that plug into customers' on-site SAP Business Suite systems, and that SAP will host for customers using a multitenant architecture. “

“However, SAP won't develop software services that compete directly, as independent SaaS applications, with companies such as Salesforce.com, Concur, and Ariba”

This sounds like a “moat” strategy – protect the core, on-premise product with a series of  surrounding “best of breed” SaaS

Reconcile it against the integrated, wall-to-wall is better than best-of-breed argument SAP has been using for decades. Reconcile this with their  BusinessByDesign – which is a fairly broad SaaS ERP/CRM solution set -  and promises we heard at Sapphire just 4 weeks ago about that “bear coming out in the summer”

Or may be we should just ignore these as periodic yawns from the still hibernating bear…not ready yet to stand up and dance with Slim Shady.

Targeting the Microsoft Desktop

History is littered with names like Novell, Lotus, Borland, Corel, StarOffice and a bunch of others which have tried to stop the Microsoft desktop and LAN juggernaut - its Office, Exchange and Sharepoint families of products.

Larry Dignan’s post on Google Apps had me thinking that in the last year or so I have seen more customers than ever before reopen that conversation.

It’s driven by:

a) Microsoft’s own missteps

Its flip-flop with Vista, the endless torrent of fixes has not endeared Microsoft to many CIOs to start with. But even more aggravating to many has been Microsoft’s wildly inconsistent pricing – when it sells direct, versus what it has in its reseller channel, versus what you can buy retail, or as a student; the differences between upgrade and new purchase pricing; what it packages whether you need them or not (products  like OneNote and Access). Compare to the far simpler (and far cheaper) SaaS pricing of vendors I mention below. More and more CIOs are willing to look at a “tiering” decision for Office applications– for power users they may want to continue with MS, but there are plenty of users who will never need to use pivot tables in Excel or watermarks in Word or animations in Powerpoint and who could be migrated to a SaaS offering.

b) Newer and older choices

Far more economical SaaS choices from Zoho with Office type applications, Zimbra around email and  Google (more impact in email than Office apps) have made decent inroads particularly in SMBs. Zimbra claims to have over 40 million email boxes. IBM has been tweaking its older Notes and Domino offerings with hosting partners to offer its own version of  “SaaS” price competition (and creating its own channel conflicts with its older Notes licensees)

But beyond price, many of these SaaS vendors have opened up the conversation around collaboration. Expect Google with Wave and Cisco (with telepresence, Webex and PosPath) to further define that space.

Finally, we live in the world (ironically while the moniker of Unified Communications is being bandied) where people check their Twitter, FaceBook, Sykpe, SMS on their mobiles before they open their email.

Which of course begs the question Microsoft is increasingly being forced to face – why is our desktop investment not declining with its shrinking role?

How ERP vendors can change the world. Seriously.

I have spent a lifetime implementing, analyzing, now blogging about SAP, Oracle, Lawson, Infor and other on-premise ERP vendors. In recent times, I have grown increasingly disillusioned with them and have been critical of them – their maintenance models, their services ecosystems, and general lack of innovation.

One area they appear to show some interest in innovating is around sustainability. But they are letting their accounting side versus their shop floor side lead that. The focus is on compliance and reporting. As further proof, alumni of SAP and Oracle have launched a company called Hara. The founders have a Sarbanes-Oxley compliance background.

That’s well and good, but we will regulate and comply and report ourselves to oblivion if we do not curb and reduce emissions and greenhouse footprints.

So, here’s a plea to ERP vendors. Focus on the plants, the refineries, the supply chains in your customers. You have plenty of MRP, plant maintenance, health and safety, transportation management licenses out there. Work more actively with your technology partners which provide control systems, sensors, scrubbers.

Get out of your white collar comfort zone. The big opportunities are far away from headquarters . Even the data center is a very small percent of the carbon footprint. Focus on your customer utilities, planes, factories, buses. Get to the root causes. And don’t just report. Help reverse.

Give me stuff I can proudly write about. Not your TCO.

Larry Dignan , Jeff Ventura  and Dennis Howlett add their POV

"Sony Launches New Version of Betamax Technology."

No Sony has not  - but Tom Wailgum at CIO Magazine compares Microsoft’s latest attempts to go after search and MP3 markets with Bing and Zune - to that.

While we go retro, let’s sing with Outkast

“ …Shake it, shake it…like a Polaroid picture…”