deal architect

The Platform and Process balancing act

Dennis Howlett in his own inimitable way captured this exchange between Marc Benioff and a journalist during a Dreamforce Q&A session

Marc, with a mix of sincerity and sarcasm at the way the question had been worded, emphasized that Salesforce was proud to be in the revenue enhancement business for its customers.

In breakouts and hallways I heard about how to incentivize different types of salespeople, the neuroscience of selling, how Amazon’s Mayday is reshaping customer service, the vertical nuances of customer service, how yield from email marketing remains stubbornly low. There was an intense focus on business process focus and results.

This was such a contrast to the other conference messaging around Salesforce1, the developer hackathon, the HP SuperPod.

Like any enterprise apps vendor, Salesforce wants to be a platform player. But it has to be careful not to do what SAP has done. SAP used to be the focus point of rich discussions around supply chains, treasury management and countless other business process threads.

Over the last decade as it has emphasized NetWeaver, Business Objects, Sybase, HANA it has lost that business process edge. Indeed I met a startup at Dreamforce which also does business with SAP. I asked them if they had engaged with SAP around a logistics positioning. The response “No. The only way to engage with SAP these days is to talk HANA”

As I have written before

“Not sure why SAP chose to defocus its dominant enterprise apps leadership and stray into spaces where IBM, Oracle, SAS, Microsoft and others were much stronger, but it has done so. Its (reduced) attention to apps has been diffused even more by years of seemingly wasted BYD investment and digesting acquisitions like SuccessFactors. “

I hope Salesforce never loses the focus on revenue optimization and customer facing processes as it transitions into its new messaging of the Internet of Customers. 

If this is "content free", please give us lots more

15 years ago, I made a trek to Fargo, ND to the Great Plains (now part of Microsoft) Stampede user conference.  Doug Burgum, the CEO used his entire keynote to tell the story of an English clockmaker, John Harrison who beat out far more qualified scientists to solve one of the vexing problems of the 18th century – how to accurately measure longitude, so important then for sailors and for all kinds of navigation since.

The journalist sitting next to me was irate. He had not made the long trip (there are few easy ways to get to Fargo) to not get a product update. Me, I was spellbound by Doug’s talk.

Maybe that’s just me but talking to several after the Dreamforce Marc Benioff kickoff keynote (you can see the 2 hour replay here), I saw several disappointed analysts and bloggers. The feedback: not enough Salesforce product  focus in the session.

My reaction

a) Plenty of customer focus

I liked the weaving of Philips, ADP, Sony, Ford and other customers in the context of evolving sales, customer service and marketing scenarios.

b) Showcase of  non-Salesforce technology

Too many vendors just talk about their products. This keynote wove in several innovative technologies from around the world both on stage and on the video screens:

• Marc’s Philips Sonicare wifi enabled toothbrush
• Philips EPIQ7 ultrasound machine
• Canon connected camera slung around Marc’s neck
• Marc’s Loubotin sneakers
• Tesla S
• Google Glass
• Sony PS4
• An interactive bus stop

c) Generous time to charity

It is a passion of the company and Marc, courageously I thought, spent lots of time and early in the keynote, highlighting Sean Penn’s work in Haiti and other efforts.

d) Follow up q&a

Marc and the CTO, Parker Harris made themselves available in formal and informal settings to answer questions about Salesforce1, the HP Superpod and other announcements at the event. And yes even snarky questions about Oracle and Larry Elllison

e) Day 2 and 3

are about product breakouts. There are several tracks for sales, service, marketing, social.

f) Dreamforce is all about diversity

Salesforce shared this graph which summarizes the event over the decade. You can see the wide range of musicians, politicians, thought leaders that have graced this event. Given this rich variety, why should yesterday's keynote have just been a boring product update?

Consumerization 2.0 –a new IT opportunity

Chris Murphy at Information Week

The 1.0 version was: “See you, IT chumps. I got my iPhone, Dropbox, and Google Docs, and I’m out of here.”

Consumerization 2.0 sets a higher standard: “Hey, IT, can  we build a zippy app for my smartphone so I can grab customer data to do my job better? Is six weeks enough time?”It used to be that in-house IT merely had to be functional — employees had no choice but to use it. Now employees expect beautiful design and speedy delivery. And they expect to be able to use consumer apps — or at least their enterprise cousins — when they make sense.

Enterprise software, say hello to the Internet of Things

Frank Scavo pointed out recently “You really like to write about sensors”

He is so right. On the New Florence blog, the category with one of the most posts over the last 8 years is the one on Telemetry (Sensors, RFID, GPS). In The New Polymath, I wrote quite a bit about BP’s “sensory networks” it has been pioneering in its refineries, tankers and elsewhere as far back as 2004. Other books have described the GE Industrial Internet and other such networks in other industries.

I have been a bit surprised enterprise software, especially ERP vendors, have not done much to help companies better capture and analyze the growing mountain of sensory data.

I am looking forward to hearing at Dreamforce about Salesforce1 its framework for the IoT among other things. With the “quantified self” manifesting itself through so many consumer devices you can see how Salesforce is positioning the CRM angle.

But there is a far bigger industrial angle, that companies like GE with sensors in its wind turbines, aircraft engines, MRI scanners are leveraging. There is still a huge opportunity for other enterprise software vendors to generalize access to the Industrial IoT. 

Apple’s unique version of R&D

Booz and Co does an annual survey of R&D spend and its analysis always shows interesting patterns. It cautions, though, that R&D does not always equate innovation and that makes sense. R&D is usually product centric, and often business model, ecosystem and other innovation pays off more. But even more proof comes from fact that Apple rarely makes it to their big R&D spender list.

That’s partly because Apple’s R&D is actually more ID – as in Industrial Design

In a new book on Jonathan Ive, the head of ID, you see plenty of examples of pioneering technology and design trends in the (small but unbelievably talented) group. A stereo lithography (SLA) machine to create 3D print outs as far back as early 90s. Patents for gestural UI a decade ago. Plenty of materials science in resistive versus capacitive touch screens. Plenty of untried components in the iPhone including the Corning Gorilla Glass. Waves of pioneering miniaturization. The Unibody process where they start with a 2.5 lbs of high grade aluminum and chisel out a light, extremely strong frame with no bolted parts. They have countless patents to their name.

The ID group doesn’t stop there. They take it to commercialization spending time at contract manufacturing factories prior to launch. BusinessWeek describes the billions Apple is investing at its suppliers including “equipment to polish the new iPhone 5c’s colorful plastic, laser and milling machines to carve the MacBook’s aluminum body, and testing gear for the iPhone and iPad camera lens”. That is what many other companies call the D in R&D. At Apple. it is more of the purview of its Engineering group.

But the biggest impact the book showcases is the rapid release of features and new configurations (like the iPad Mini, Air etc). That offsets the “fast follower” scourge which torments so many innovators.

Yes, Apple may not call it R&D and may even mock focus groups and other market research, but their small ID group provides a model for many other companies to try and emulate.

The customer service crisis at Southwest Airlines

I got a very nice voice mail and email below – on a Saturday no less – from Lan Nguyen, a customer service rep at Southwest Airlines

“We are in receipt of your most recent e-mail and apologize that we did not adequately respond to your first inquiry. I wanted to speak with you personally and regret that I was unable to reach you by telephone. I appreciate the additional opportunity to respond to your concerns….”

So, why does the title of this post read negative?

Lan’s response was about a systems error I reported on its reservation site

purchase.error.INVALID_LOYALTY_MEMBER_ACCOUNT_STATUS (SW900001-DJGr4Ya4QKKRTRm9JVhzmQ)

It is an error which affected many SW customers. Lan’s email acknowledges “Customers were unable to book loyalty reservations.” I had communicated to SW the specific error message by phone, via their website and by Twitter. But for 3 days no body apparently tried to alert their systems group and certainly did not bother to update affected customers like me.

OK so one off?

Not really, their Twitter channel has to be one of the most unresponsive. They must be swamped because they never acknowledge tweets. But even their other customer service channels have deteriorated.

On September 30, I used their mobile app to check in to their flight the next day from Pittsburg to Tampa. No problem. Next morning I try to print the boarding pass at the hotel. No luck. I call SW. Ticket has been cancelled. I try to escalate but am told no supervisor is available. End up buying a new ticket and never did get a call back. (I started a separate email thread but still did not get a refund)

On October 11, I arrived early at Chicago Midway and asked to standby on an earlier flight. I was told “you are on a Southwest ticket. The AirTran system cannot handle those on standby”. I pleaded to the agent to call someone in support. His response “Trust me they are not much help”.

A complaint got me this response

Although we’ve acquired AirTran and connected our networks as a part of our integration process, it’s important to understand that we remain independent carriers with separate reservation systems, loyalty programs, liveries, etc. Further, because we are still separate carriers, reservation continue to follow the marketing rules of the carrier on which the itinerary was booked.

Important to note the acquisition happened 3+ years ago.

Through the years I have used their web process to request refunds for poor wi-fi on their flights. They have tried this wi-fi provider, Row 44 for 3+ years and the service continues to be inconsistent or just plain unavailable.

I am one of their best customers. In her email, Lan writes me

We realize that, as an A-List Member, you have a unique and invaluable perspective, and we always want to use your feedback to sharpen our operation.

Tired of repeated problems over the last year I sent the CEO an old  fashioned letter. I must be real “unique and invaluable” because, I kid you not, I got a post card back. And no they did not follow up within 5 days as the card says or even 10 or 15.

May be I am just unlucky, but the instances are too frequent and across all their channels to dismiss.

They have a customer service crisis. They need to speed up the AirTran integration, get a new wifi provider, and change some silly policies which are causing a spike in customer complaints.

But just as important, they need to hire a few hundred responsive Lans.

More global innovation

Innovations from various parts of the world we don’t usually expect innovation from

Arab Lady Technologists - Oman, Qatar

Unique ID - India

Kinect and Sign Language – China

Amazon’s Fashion Studio – Brooklyn

Airport Advertising -  various US airports

The changing world of wine – Georgia, China, Chile, others

earlier posts in this series are here and here and here and here and here and here and here and here and here

Predict and Prepare

Join Bill Kutik, Naomi Bloom, Brian Sommer and me as we discuss opportunities and challenges for 2014 in this Workday sponsored videocast on December 10.

Register here 

We will cover many of the themes I blogged about this HR – Opportunities Galore post.

The IBM Balance Sheet

Fortune on Ginni Rometty of IBM

Speaking October 16 at the Fortune Most Powerful Women Summit in Washington, D.C., Rometty outlined five areas on which she depends to help her prepare IBM for future markets. First, there's research, an area in which the company has long been a leader. The company employs 3,000 Ph.D.s -- the largest research outfit in the technology industry -- and has been the global patent leader for the past 20 years. Just as important are relationships with clients, who are increasingly partnering more closely with IBM on innovation initiatives. Rometty also nurtures relationships with universities and with the venture capital community. And, thanks to new social tools, Rometty has been able to connect more deeply with IBM's 400,000 employees to unearth ideas bubbling up internally.

That lays out IBM’s assets pretty well. But on a balance sheet you have equal and opposite liabilities. Here is also what Ginni has inherited.

a) An old-in-the-tooth product portfolio

Notes,  Tivoli, Websphere, DB2, SAP consulting, outsourcing from Cold War era bunkers called Data Centers – by my estimate 2/3rds of IBM revenues come from products and services 10, 20, 30 years old.

b) An aging executive team

BusinessWeek calls its IBM’s executive office well seasoned. 14 of the executives have received their gold watches for 25 years of service. That would open eyes in any industry. In technology it really makes you take note.

c)  Slow customer adoption of IBM innovations

Think of all the publicity Watson got after the Jeopardy! showing. Now 3+ years later see how few customers have adopted it. Ask IBM for the real life implementations that look so good in 30 second Smart Planet commercials. Many are one-offs.

d) Under-prepared for the Cloud era

IBM defined world-class in days past with its data center Yellow Books and other methods which influenced ITIL and other standards. Go to today’s cloud data centers and the energy management, redundancy, latency and security design leadership is coming from Amazon, Google, Facebook, Terremark, Switch and others. IBM is not even in those conversations. Same thing with systems integration. IBM is a small player when it comes to Salesforce, Workday and other SaaS projects.

e) Not blue suit, red tie anymore

Not unique to IBM but significant staffing in the last decade in emerging markets like India has created a diverse corporate culture. And ethical challenges and accounting issues in many markets.

HR – Opportunities Galore

Bill Kutik ribbed me recently about a decade + old prediction that the HR function would evolve into a Knowledge Management function.  He is right, of course. Microsoft and IBM and others sold plenty of Sharepoint and Notes and other tools, just not to HR.

I also predicted HR would take a bigger role in managing growing  contingent and outsourced labor pools. Actually procurement did. I also thought HR would jump at telepresence and collaboration technology to increase employee productivity. It did not – IT did.

HR folks often complain they are not given a chance to be “strategic”. Actually they are given many chances, but often choose not to step up.

A new wave of opportunities is opening up

Data Science

You have probably heard of the UPS analysis of its driver routes. It found plenty of wasted time and fuel while idling at left turns so minimized such turns in its routing algorithms. Every business has its own employee related “left turns”. Sensors, GPS devices, mobile phones, sentiment analysis tools, email pattern analytics – all provide all kinds of employee related data which HR could leverage. Or someone else in the enterprise will.

Man machine interaction

The auto industry is innovating in a number of ways – driverless cars, humanoid robotics assisting not replacing workers, augmented reality training. Other industries are similarly leveraging sensors and tags and devices for other operational efficiencies. There are man-machine – not to mention union, worker hostility – implications in each.  Will HR be in the middle of all this?

Work redesign

As tablets and thin displays and scanners become mainstream, office design is being revolutionized (just think how much space you can clear up if you do not need filing cabinets for paper documents and deep desks for old school monitors). More employees are working out of their cars, at home, at their Starbucks, with airplane wi-fi. Is HR influencing new work designs and policies?

Aging workforce

Entire countries like Japan and sectors like the US government are facing the challenge of aging workforces with related recruiting, knowledge transfer, delayed retirement scenarios (with technologies needed for workers with diminished eyesight and other faculties). Is HR ahead of this challenge?

Changing definition of skillsets

With the emergence of MOOCs, wearable computing guided OJT, newer forms of trade schools and digital education, the concept of entry level and continuing education is rapidly morphing. This has huge impact on skillset expectations and on recruiting and learning management systems. If HR does not step up some one else will.

I could go on, but the good news is there never has been a better time for HR to become more strategic.

Will it?