deal architect

Weekend Stuff: Put away your Sunday newspapers…

and make time for the latest in the Technology and My Hobby/Passion series on the New Florence blog.

Mark Twain spent his Sunday mornings scrapbooking as Debbie does and Rudyard Kipling would have been fascinated with the stuff Sameer cooks.

Debbie Brown	Scrapbooking
Sameer Patel	Asian Fusion Cooking

There must be 50,000 ways to leave your job

Ever heard of losing your job (as CEO no less) for magazine subscriptions? “He subscribed to the magazines, including Cosmopolitan, Shape, Fortune and regional publications, to keep up with industry trends and lifestyle issues concerning Ideal Image's likely customers”

How about for having “caused disharmony in the workplace by using block capitals, bold typeface and red text in her emails.”

Paul Simon makes a lot of sense…

“You just slip out the back, Jack
Make a new plan, Stan
You don't need to be coy, Roy
Just get yourself free”

WoIP – War over IP

We cannot agree on how to pronounce VoIP and maybe that is why it has led to massive food fights

• The founders of Skype and their dispute with the company they sold it to,eBay and the new owners
• The he said/she said in FCC filings between Apple and Google on Google Voice for the iPhone. Of course, there is confusion whether Voice even uses any VoIP technology
• The serial lawsuits by Verizon, Sprint, At&T and Nortel against Vonage in the 06-07 time frame,

Now that it has morphed and is part of broader Unified Communications, I cannot wait to see how many more legal battles are launched. But at least a bit easier to pronounce :)

There is capital and then there is capital

In the 90s when George Shaheen was CEO at Accenture I was at a dinner speech where he said “Like Bechtel, I want my firm to go in to obscure parts of the world and raise cities where they were none. Digital cities in our case”. I could relate. 10 years prior as a young auditor I had spent time in the city of Jubail, Saudi Arabia where Bechtel had been the master program director. I was impressed with the thousands of blueprints and program plans which showed the complexity of coordinating massive shipments from Japanese, Korean and other suppliers. And labor from at least 20 countries that turned that piece of arid desert into a modern township.

Like Accenture, Bechtel is a darned good integrator. Like Accenture which is good at managing staff ebbs and flows, Bechtel is good at managing cashflow ebbs and flows.

But today, I see a Bechtel rep say about VC investment in Greentech “Capital needs will be far greater than what venture capitalists experienced with high tech.” Actually infotech has seen much bigger investments than the construction industry. It’s just that VCs were selective which segments of the industry they chose to invest in like chips and software. They kept away from those that required massive armies or oodles of long-term capital like systems integration, outsourcing and telecom services. 

I suspect something similar will happen in Greentech. VCs will leave those segments which need armies and long-term capital to the Bechtels, and increasingly the Accentures of the world (as smart infrastructure projects require blending knowledge of sensors, fuel cells and cements).  The VCs will happily be funding startups which make better sensors, better yielding cells and newer cements.

NetSuite’s version of “Don’t Upgrade. Escape”

Two weeks after I wrote the post with that title, NetSuite announces its CrossRoads initiative “..supported by integration partners CastIron, Pervasive and Boomi, includes NetSuite products, partner services and a special sales promotion to enable mid-size companies and divisions of larger companies to transition from aging SAP software to NetSuite OneWorld for SAP”

The trigger is upgrades.

“ SAP has announced that maintenance for R/3 V4.6 will end as of March 2010; and maintenance for SAP R/3 4.7 will be extended, but at a higher cost.  According to Cambridge, Mass.-based Forrester Research, these changes will affect approximately 70 percent of SAP users who now face difficult decisions: whether to pay increased costs for maintenance or upgrade to SAP ERP 6.0. “

Ergo, don’t upgrade, escape.

Boy, 2 weeks after I wrote about SCARS, NetSuite announced its Cash for Clunkers. Now this. I better not give them more ideas :)

Not. Humbly, let me acknowledge they have been toiling at this for 10+ years. They have offered SMEs great value SaaS years way before this blog was born.

Stealth, strategic apps

We know mobile apps at the iPhone store and around other mobile platforms are growing at a torrid pace. We know SaaS vendors are busy developing new platforms and apps. We know where apps are not getting enough attention – the big boys seem much more interested in analytics – Exadata, in-memory excitement.

But there is a category of apps few analysts or bloggers talk about. They are growing rapidly, and they are changing the face of the technology market.

When I read an Accenture study about how “software is everywhere”, I did a quick back-of-napkin assessment. Over 80% of clients I have worked with in the last few years have software (and other tech) embedded in their products or in their digital services. Not just high-tech companies, mainstream industries from consumer products to healthcare to education to financial services.

And they are custom building these apps.

Which means they are getting savvier about the economics of technology. They know what it costs to code and test apps. They know how to run call centers. They know how to manage spare parts and service depots. They know the economics of offshoring.

Not that they ever forgot. Many of these companies wrote code way before most software vendors were born. They successfully migrated past Y2K. They have continued to run elaborate test streams to compensate for the quality delivered by the software industry. They pushed their service providers to adopt Six Sigma, CMM to discipline their software methods.

And their new applications are truly life-blood. They drive revenue. They provide competitive advantage.

When you are working for one of these companies you don’t know whether to laugh or scream when a tech vendor talks about their “vertical depth”. Or tries to convince you about their economics. They are comparing against their vendor peers, not the benchmarks these companies internally have. And you have to resist the temptation to point out they are delusional if they think their offerings are strategic.

The strategic apps are being custom built. And they are stealth. Except they would be blindingly obvious if the tech industry would look beyond its own boundaries.

More New Florence

On the innovation blog

Consumer Electronics Improvements from Twitterland

Odd Couple: Accenture and Bug Labs

High-Frequency Trading

China’s Green Progress

Tech in Fortune’s 50 Most Powerful Businesswomen

Whatever happened to Safra Catz?

Fortune has a nice, long story on Oracle’s press-shy President.

One quote jumped out at me.

“Her clients always came first,” – when she worked at the investment bank, DLJ.

Wow, I have never heard a single Oracle customer say that about her. Oh, she is charming hostess at Oracle Open World. But if there is a customer issue during the rest of the year it ends up with Charles Phillips, Keith Block or Juergen Rottler in the executive suite. Not Safra. And trust me there is enough angst about Oracle maintenance and other pricing that she hears about it. Repeatedly.

So, where did her intense customer focus go?

I would love to ask her. But I expect her PR would take her stance in the article: "If a reporter is giving you a hard time, is being unreasonable, you have my permission to tell them to go fuck themselves" :)

Our trillion dollar a year disease

I Googled Cincinnati Children’s Hospital this morning. A smattering of news, blogs and Tweets. I then Googled the TechCrunch 50 conference, and the screen lit up like a Christmas Tree.

And I felt sick to my stomach.

You see CCH was recognized last night as one of the top 10 most innovative US users of technology at the InformationWeek 500 Conference.  But in this perverse industry of ours, cool vendors many without a dime of revenue get way, way more attention.

Every vendor in the industry spends 20 to 50% of their revenues of sales and marketing. That’s give or take a trillion dollars a year on spin. And it has turned on us.

We have smoked so much of our own exhaust that we celebrate ourselves, other vendors, VCs and investors way more than customers.

I cannot recall a WSJ or New York Times article on a CIO in the last year, but every little nuance of the new iPod Nano is faithfully reported. I look at the Gartner ITxpo agenda. Vendor and analyst keynotes dominate. 99% of presenters, I would bet, never had to be crucified by their board why an IT project ran over or delivered little value. They have never been in the customer’s shoes.

We smugly tell our customers they need to get “social” but we smother our own debates – with a healthy portion of that trillion dollar spin.

Oracle runs a full page WSJ ad telling customers it will spend more on R&D than Sun does today. Does anyone ask “Larry – in how many of the many companies you have acquired has R&D actually gone up?” Trillions CPU cycles later you would be waiting for an answer.

This weekend I posted on the Siemens-SAP spat. Sunday, I get a call from SAP to the effect of “our relationship with Siemens runs deep”. Of course, it does, know that very well from my consulting business. But the point is one of their biggest customers is telling them maintenance pricing is too high. But I doubt SAP will address that specific point. In fact I expect more spin like on this blog post “Siemens shouldn’t cry too loudly about their maintenance costs…” Trillion reasons why we don’t let a customer’s concerns – and Siemens is only one – be debated in the open.

AT&T which barely works in my back yard, brazenly spends millions on TV advertising their 3G service works in the middle of the Pacific or at the end of the rainbow. Trillion dollars says they can get away with that.

I could go on and on.

Let’s reverse course, my friends. Let’s write more about customers. Let’s debate their issues more. Not spin them.

And let’s invite more customers to our conferences. And when they show up, let’s do something corny I do. Ask them to stand up and give them a hand. They will be embarrassed by the attention, but it’s more to clear our trillion dollar a year fog on who and what are really important.

Is SaaS too defensive?

Last week I saw a conversation at Frank Scavo’s revisited around SaaS and code in escrow. This week I see Ryan Nichols’ post on Cloud Insurance

It’s good to see SaaS world step up and provide jittery buyers comfort in a number of areas. But I get the sense they are overreaching.

I mean, seriously, what tiny miniscule percentage of companies ever reached into bank vaults to get escrowed code belonging to failing on-premise vendors? I mean with the spectacular overruns around so-many ERP, CRM and other on-premise software, what “insurance” did buyers have? They just sucked it in and wrote it off.

I have written before SaaS is delivering better up-time availability than most mainstream on-premise commercial applications. Your hair would stand if you heard what security breaches are happening in on-premise data centers – yes, even so-called fortress banks. SaaS in many ways is doing fine around security as Laef Olson, CIO of RightNow wrote in his guest column.

On-premise vendors can raise FUD all they want. The best defense is to ask them for their own track record and metrics.

I would rather see SaaS vendors start to invest more heavily in functional, geographic, vertical feature growth. Especially in many areas where on-premise vendors have not delivered the last few years, even after promising to do so.