deal architect

Relational Databases: Gradually, then Suddenly?

In The Sun Also Rises, the Ernest Hemingway character is asked “How did you go bankrupt?”. His response ‘Two ways. Gradually, then suddenly”

I thought of that relative to relational databases during a meeting with Hasso Plattner of SAP in Orlando recently. There was a palpable sense of vindication that his view on columnar databases like HANA has been tested and validated by thousands of customers

“Yeah, that's mainstream. I feel good about that, ten years ago, I had an idea which really worked: streamline ERP applications to basically record only transactions.

And, for everything else there are algorithms to exploit the data….Facebook doesn't know what aggregates are. Why do we have aggregates? They have no aggregates.

Today, it's all on demand. People are not permanently rolling up and looking at rolled up data. And, if they do that, then it's fast. If they want to change it, it's instant.

That is really gratifying”

Then I read this Werner Vogels (CTO of Amazon) post

“We found that about 70 percent of our operations were key-value lookups, where only a primary key was used and a single row would be returned. With no need for referential integrity and transactions, we realized these access patterns could be better served by a different type of database. Further, with the growth and scale of Amazon.com, boundless horizontal scale needed to be a key design point--scaling up simply wasn't an option. This, ultimately led to DynamoDB, a nonrelational database service built to scale out beyond the limits of relational databases.”

He then proceeds to talk about a wide array of databases Amazon now offers, including a relational one.

I still believe relational databases are declining “Gradually”, not “Suddenly” about to hit the wall. New applications are increasingly running on non-relational options. Converting legacy applications will take a long time. Retraining DBAs, adapting systems management tools to support new databases for stringent SLAs will take time. It’s unclear if the Teradata lawsuit will slow down HANA adoption. (we met Hasso before that announcement).

But I am now prepared to say that the “Gradually” decline is starting to accelerate.

Tech Marathoners: John Wookey – Part 2

We ran yesterday Part 1 of the interview with John Wookey. Part 2  below focuses on his view of the future of the industry.

The next-gen of apps will "give more than they take"

AI is being delivered now as us to incremental functionality on existing applications. But we still haven't done what I expect, which is, at some point, step back and say…what if we had not built any applications at all, and we exist in a world in which the data around the business largely all available It may not be in your core CRM system or your ERP system, it may be sitting on some social site somewhere, but it's accessible in some way.

And you understand that your opportunity is to, if you understand the business context well enough, go get that data. And rather than ask people to type data into a system and then spit it back at them, {which is honestly what most applications do) That's what most apps really do...ask for data and then give it back to you.

Now....you can start with the objective and build a very different kind of app. The idea is that you say, "I have this quota for this quarter, and I need to hit this target, or I have this many customer support tickets I need to get through." Or, "This is my objective for a marketing campaign." Or, "This is my my manufacturing objectives for the month." Or, "This is the cost model we have in place for supply chain." Or, "This is the period of time in which we want to close our books." Or, "This is our recruiting target for HR."

There's a million business systems out there. If you think about it, they don't exist because we like having them. They exist because we have some business problems we are trying to get help with.

And so if you start with the idea of, here's the business objective, AND there's all the data in the world. What kind of an application would you build? The analogy I always use is Waze, which is to me, like the application that showed the best value or the best shift that will happen. When you go from a world in which you have an app that shows you red lines, yellow lines and green lines on a hard to read Google Maps, which is kind of what used to be in the traffic apps, if you remember them. To Waze. No one cares what the traffic is like in that area. What they care about is finding the best route to get home. How do I get from A to B as quickly, easily as possible. And tell me my options in doing that. And then feed me, turn by turn what I should be doing.

Waze is in an application that gives more than it takes. I think, and it won't just be about AI. But I use AI because it helps illustrate a new way to think about Apps in a world in which the necessary data already exists and you can connect to it. And because I think AI will be in the center of most of these Apps. But the idea that the data exists in the world, the fact that we can understand the business objectives, and the fact that we can go be an external applications for them that actually would be, will give more than they take. I think we'll define a generation of applications.

I think it's the same. I think it's this shift. It's this next generation of applications. It's this idea that applications are not only going to become smart, and they're going to understand what you're trying to accomplish and they're going to give you choices but they're going to be highly adaptive in doing that. They're going to redefine themselves. They'll be a set of constraints around the organization model. The way the organization wants to run its business, but within that, an individual, the way they want to work, they way they want to connect with the data, I think these applications will be incredible. The great applications of the future will be incredibly personalized.

So from a building software perspective, it's wildly exciting. It's a huge joy I think for software developers to think about all these tools that exist now to build applications that truly delight people and then marry them to what they're trying to accomplish.

From a business perspective, it'll be incredibly challenging because it is really hard when you're an existing player of a huge legacy footprint to make the shift in a non-disruptive way to your business. Another angle – that I started to hear from COO's about it over the last couple of years, was, "explain to me again why we're signing a three year subscription contract?" I understand users go up or down. Why is this not more of a model I can end up where it's more consumption based? There was a huge shift in going from perpetual license to subscription. But going from subscription to consumption based will be the next thing I think customers start looking at.

And it won't be a clean one. I think it's going to be some sort of an evolution of subscription that has a more flexible model based on the idea that if the roll-out doesn't go as fast as we thought, you don't pay as much. It goes faster, you pay more. And there's some boundaries around it. But I think more and more that's going be the expectation driven because of people like Amazon. And I think that will be a good change, because it will tie vendor and customer success together more closely....which is a good thing. But the change will be tough shift.

The coming data war

My wife and I were driving somewhere and she pointed out a building with "Google Cloud" on it. She goes, "What's Google Cloud? Is that different than Google?" And I said, "Well, Google is like a lot of organizations, they're trying to build a big infrastructure businesses. And of course the 800 pound gorilla in that space is Amazon. But everybody else is trying to chase that business and catch up. I hear about Alibaba now, Google of course, Oracle keeps talking about it, IBM's in the space, Microsoft's in the space.

I just never know with Google....is it self driving cars, is it glass, it's always hard to figure out where they go next with their business. But if they're serious about being a cloud infrastructure player, given where they are today, I don't know how they do that. You have to find a way to create some kind of critical mass for that. And at some point, you have to look around and say, well, what do we, how do we do that? Doing it organically is tough.

They have great AI services but I don't think that's going make anybody move over to their infra structure. Because AWS has AI services as well. So does Microsoft.

So it seems to me that someone like Google has to go and acquire something like Salesforce. And I don't know if it'll happen or how it would work. I don't know culturally how it would set. But they need to think about if you're going go in the cloud wars, how do you create enough content data, critical mass, where people say, I already have those apps and that data in your system, I might as well look at what else they have and consider it.

That's where there's always going to be the tricky thing for the evolution as they look at what the next big business opportunity is, how do it get there if they're five or ten years behind the organization that's already the leader in the space?

I think they have to acquire something big to do it. I think if they got really worried about Microsoft, I can see someday, both Amazon and Google saying, "Oh crap. We have to go buy Salesforce."

They need a strong application footprint. And frankly there isn't really a strong applications footprint on the ERP side for cloud yet. There's Netsuite and Microsoft has ERP,. Workday is probably the strongest independent ERP in the Cloud.

And so how do you think about that? And there's a decent ecosystem around Salesforce. Including some ERP stuff and some industry stuff that with the right investment could become significant in that space.

So I think both Amazon and Google could both wake up one day and say, we need to go get that. Which could become an interesting acquisition war. And if they start, Microsoft will probably jump in as well.

It's a good question. And yet I think what Facebook realized with I think Microsoft is realized it's the war of the future is a war for data. It's how do you get this data? I think Microsoft buying LinkedIn was smart. I think them buying Github was smart. They clearly get that the future is about the data. And the data that sits out there that they don't own, that is really fundamental to business is the customer data. And honestly, Salesforce owns that.

So, that to me, if you're Google or Amazon, that's kind of the next thing you think about.

Tech Marathoners: John Wookey

I am excited to start a new series of interviews with tech executives who have seen the industry evolve over a minimum of two decades. They have helped analyze, envision, develop and take to market some of the most influential technology the world has seen. And they have done it well mile after mile as elite athletes do. I am honored they spend the time with me reminiscing and star-gazing.

Kicking the series off is John Wookey, who has been a senior product executive in the technology industry for more than 35 years. He started with Accenture (when it was still the consulting division of Arthur Andersen) and has worked for some of the largest software vendors in the industry, including Oracle, SAP, and Salesforce.

Part 1 of the interview focuses on the past and present. Part 2 will focus on his view of the future of the industry.

35 year career arc

It's interesting to see my career arc from the time when computers were relatively nascent in the business world. The big banks had them. Big insurance companies had them. But computers were just starting to move into mainstream business. When I started with Accenture, which in those days, was the consulting division of Arthur Andersen, you went to up to St. Charles training center. You were still using punched cards. I never worked on mainframes, I never did card punch but they still trained you on it.

It's kind of hard to envision that today, given consumers walk around with computers in their pockets. The thing that I always say has changed the most is not the technology, what's really changed is the audience and the customers we are creating it for. You go from a world of which people had never touched them before, and frankly were a little terrified by them. And you did everything you could to sort of emulate paper systems they had before, to where now in the business world, expectations for enterprise software are largely driven out of the individual's experiences using consumer technology. Which is very individual-centric, very adaptive to their work styles. And enterprise systems are trying to keep up.

So, that to me is the most interesting thing in these 35 years is how fundamentally different the customers, the users, the audiences change for the systems that we're building. And now whether it's your customer or your employer, your partner, the systems you are creating are very likely being tested against consumer grade software that we never envisioned when we were building enterprise systems even a dozen years ago. And that affects industry trends , how existing companies rarely make that transition smoothly, but it gives an opportunity to a host of new companies to grow up and become the new leaders. Inflection points

Emerging technologies tend to come into the industry in two phases. There's a phase of incremental improvement. The technology is applied to existing products to provide incremental improvement. And then there's a much bigger breakout phase where people go back to first principles, they rethink the problem space they are trying to address. And they take advantage of the technology in a way that is more than some incremental change on what exists, but really allows them to embrace break through thinking and deliver break out, industry changing products.

So each of these technology shifts tends to come with a shake up in the industry. Oracle became the leader because they showed an entirely new model for persistence through relational technology replacing old ISAM, flat file systems. SAP was the one which capitalized on the shift to client server with PeopleSoft doing the same thing on the HR side. Salesforce with the shift to the cloud, attacked the CRM market and exploited some challenges in that space.

And whether it was Larry Ellison really thinking about technical architecture and the importance of integration between the database, the middle and the application, or it's what Salesforce has done with a vision of multi-tenant cloud. - this idea of the same version of the software which everybody uses, whether you're a five person non-profit or the largest financial services firm in the world.

The idea that all of those organizations own the same piece of software and every four months they get a new version of it is a pretty radical idea. If you told people 15 years ago, you're going to run on the same software as people who have very little in common with you from a requirements standpoint, they would have said you were crazy. They would say "I have to have my own control. I want to run my own systems". But the ability to continually innovate, and move the technology forward and change in incremental value for the subscriptions that they're paying, is possible because there's only one version of software that Salesforce maintains and can continually move forward.

Working with some of the industry's best

I was lucky in that I've worked with and for some amazing people in the industry like Larry Ellison, Marc Benioff and also Jim Snabe at SAP. Jim is not as well known as Marc or Larry, but an excellent leader, very strong on the technology side, as well as being a strong manager. All of these leaders see the shift in these technologies early and move on them.

So, again I've been fortunate to have worked at each of these great companies. While each are in the same industry, I learned different lessons at each of them.

Oracle taught me a number things and I was lucky to learn many of them from Larry directly....things about technical architecture. And the importance of singularity in a technology model. And a vision for a technology. Because he understood that technology is constantly evolving and if you can keep it as simple and consistent as possible, it's much easier to adapt when things change, which they always do.

SAP to me, I think has always done an amazing job of really understanding the sales process in this industry. And then they couple it with a very strong service model, so SAP was outstanding in that, no matter what issue a customer had, any where in the world, the executives always made it a priority to be there to understand the problem and to help them address it.

And then I think Salesforce in addition to what they've done for the technology standpoint also understands the importance of the message and telling the story and helping organizations understand how this technology links to the business problem that they have, and then step back and put it in a broader context.

So, the whole idea of no software, that was kind of the tagline, but I think it told an important story that the software is never really meant to be what you were buying, what you were trying to buy was a better way to run your business. And I don't think anyone in the industry has a better ability than Marc, to help people understand it by using the power of his words and the message, to really deliver that.

So, I've been so fortunate in my career to work with, for and around great leaders But my greatest joy has really been the teams that I've been able to work with....and in many cases to help build those teams. For me, the joy was always in the creation of the team and the development of the team and seeing the team be successful.

The teams that built our industry solutions at Salesforce were great. I had an amazing industry team there, great industry leaders, great product managers, great engineers, great marketing people, and we operated with a single set of objectives and priorities and we pulled together.

This idea that you create something new inside of a company, and you are able to have an impact on the company, but also have an impact on the customers who are buying the products, you end up building a closer relationship with half of the organization, I think is really magical.

What's funny, is that you often don't really appreciate it while you're in the middle of it all, sometimes, you've got all this stress, and the day to day, and budget constraints and all the problems you work through, but when you look back on it, you say, I felt every week, every month, every year, becoming stronger as a team, executing better, then you get this amazing sense of satisfaction. And I've been lucky to have that experience at Salesforce, and SAP, and Oracle and all the way back to Ross Systems.

At Oracle, the last few years I was there when I was running the applications division, the acquisitions were tough. Acquiring People Soft, this was not a company that wanted to be acquired. It was a pretty stressful time but I was proud in the end that I built a management team that had great leaders....yes from Oracle, but also from PeopleSoft, and J.D.Edwards. We had a management team that it wasn't "yours" or "mine" but "ours". We all sat down every week in staff and talked about how we going to beat SAP. How do we become the number one software company in the application software company in the world?

And how do we do that using the combined expertise and the best Applications we have across Oracle, E-Business Suite, PeopleSoft, and J.D. Edwards and how we build a new thing that we're going call Fusion?

Those to me, are always the magical moments, when you create the teams that work together that everyone feels that sense like when you're, if you've ever rowed crew, there's a feeling when you're part of an eight man team and you're pulling on the oars. If you all pull together perfectly, there's a sense of effortlessness in what you're doing, like you were accelerating with almost no effort. So those to me, are always the high points, is that sense of team.

The low points are kind of the same. Usually somehow related to hubris in my thinking with the plan was, and not listening to people that work for me. I'm lucky there haven't had too many of those. But whenever I look back on bad experiences, it's always because of the fact that in the end, I got to point where I felt I was the only one that had the right answer and I didn't listen to my teams or my peers or my bosses.

Hey Amazon, Google, Microsoft, IBM, Oracle…

… a nice opportunity to show off your machine learning capabilities – specifically with transcription help for my next book.

I tend to interview lots of executives for my books. For each of my last 6 books I have tried some speech-to-text technology – various versions of Nuance Dragon, Siri etc. with very little impact. I keep going back to human transcription services.

With ML having matured so much – and voice interfaces starting to show up in so many applications – would love to have the transcription be automated this time. Over the next 3 months I will likely have 100 audio files to transcribe.

Many of these files will be captured from a speakerphone on a Zoom recorder, and I will be able to upload those MP4 file. So, there will be some degradation due to the call quality. Also many of the speakers will have German, other European, Indian and other accents and will use tech jargon. But the conversations will be in English.

Amazon, you have the inside track. We use your KDP platform to publish the Kindle version of books. Having said that, the first use of AWS Transcribe did not produce very good results.

Google you also have an inside track. Most of these MP4 files are stored in Drive. I got excited when I saw the GCP  Speech to Text conversion, but my conversations are longer than a minute. Can you help with longer conversions?

IBM, Microsoft, Oracle – same offer to try out Watson, Azure and Oracle ML services on my project.

Look forward to your support!

The Long Game

Have you been watching the FIFA World Cup? I have been watching highlights. And peeks at an occasional game on Fox Sports Go. It’s humbling to think I will likely watch less than 1% of the 96 Group Stage games and maybe just a bit more of the games in the elimination rounds. Then I got a demo from Remiqz, which has analytics on soccer players – down to individual touches, strength of opponent and other metrics, and it was even more humbling. In the game today against Iran, the Spanish team had 720 passes. Impressive but well short of the record 993 passes Barcelona had in a Champions League game. Their database has analysis on thousands such games.

We live in a world of instant analysis which is summarization of staggering amount of little touch points.  I was thinking about that when I read two stories this morning in our industry – one about SAP, the other about Oracle.

Teradata has filed a legal complaint against SAP claiming it “stole Teradata’s trade secrets (accumulated by Teradata over the course of four decades in the EDAW space), and used them to quickly develop and introduce a competing (though inferior) product: SAP HANA.” and “Upon release of its new product, SAP promptly terminated the parties’ joint venture, and it is now attempting to coerce its customers into using HANA only, to the exclusion of Teradata, by forcing its customers to adopt HANA in exchange for upgrading their ERP Applications. “

The period covered in the complaint goes back a decade. Having being involved in a few software cases as an expert witness, I started thinking how attorneys are likely to strategize.

Will SAP argue Oracle and Microsoft have long used proprietary databases in their application stacks and SAP decided with S/4HANA it was more efficient to do same? Will Teradata cite Indirect Access examples where SAP threatened customers who wanted to move transaction data out of ECC to analyze or for third party apps to access?  Will SAP argue that with Business Objects, Sybase, TREX, MaxDB and other products it had plenty of its own analytical IP and talent?

Then I stopped. In a jury trial, appeals to lay person emotion often factor more than technical arguments. But the discovery process will involve looking at lots of data going back at least a decade or more. They cannot do instant analysis, they have to watch “lots and lots of tape”

I thought of that again when I saw “Oracle ORCL, +0.07%  reported revenue and earnings beats Tuesday afternoon, but Wall Street’s enthusiasm for the numbers was fleeting. Oracle stopped breaking out its cloud business in its official earnings numbers, as it had previously, which led many to question whether the company was hiding something after slowing cloud growth had hurt the stock in previous quarters.”

JP Morgan had downgraded Oracle stock a few days prior based on “a survey of 154 chief information officers (which) revealed Oracle received the most indications for "spending contraction" this year. “

154 customers surveyed? Oracle has 430,000. I was also struck by a comment that “CIOs have clarified that they are migrating Oracle databases to Microsoft SQL Server, Amazon databases and PostgreSQL” What about moves to HANA? SAP claims 23,000 HANA customers. Does the JP Morgan database have SAP customers?

Reality is all of us sample and want instant analysis. It is useful periodically to step back and consider the volume of little touch points. Another reason I write a book every year or so. It forces me to go back and look at lots of historical tape. Mercifully, not every team has 993 passes each game.

“SAP is at its best when it is hungriest”–a conversation with Nick Tzitzon

You have read analysis from me and others about SapphireNow. I wanted to get a post-conference perspective from a SAP executive and I caught up with Nick Tzitzon, Executive Vice President, Marketing and Communications

Overall Vibe

It can be tempting to look at so many different things and slice and dice the success of an event like Sapphire. I think we have to constantly come back to what should be the only true measure, and that's what did our customers who actually participated in the event say about what they experienced?

On this measure I feel like SAP can be really proud of this Sapphire. Our customers said generally very positive things about the presentation we put forward. In past years, I felt like they knew we had the right pieces but they weren’t always seeing the full picture. This year, I honestly felt like the light bulb went off and customers saw from SAP not just a completeness of vision, but a completeness of solution. And those that really wanted a confidence inspiring plan to cement their belief in SAP for the next decade, I think those customers came away believing that we delivered it.  In many people's view, this was the strongest Sapphire we've put forward ... if not all time, certainly in the last several years.

We're getting close to 400,000 customers now ... the temptation can be to think of our customers as one audience. But in reality, they're coming at this from so many different perspectives. You have the customers that have been relying on SAP ERP for decades who, in many cases are the largest, most sophisticated companies in the world. You would have a hard time, hopefully, coming out of Sapphire not believing that SAP is prepared to deliver you a complete solution tailored to your industry. Alternatively, if you came to Sapphire because you are running one of our LoB solutions, say SAP Ariba or SAP Fieldglass, and you are looking for more of an introduction to the broader universe of what SAP can offer, I also feel very good about the presentation that we put forward.

International attendance at Sapphire is always an interesting thing. SAP is the most global company in the space. That makes our customer base particularly interesting. We always struggle in a North America event with certain constituencies. They don't like the big show stopping approach in some cases as it doesn’t keep with their cultural norms. I think we've done a better job in the last few years being able to tailor the experience to those customers in a way that makes them feel more comfortable. But that's also the benefit of SAP doing events around the world. Increasingly, we take advantage of the fact that we can deliver a Sapphire-like experience on nearly every continent, so every customer or prospect can experience the vision and the strategy of the company in a way that relates to them. If it's not in their natural language, at the very least in a style that's more accessible to them. SuccessConnect in Berlin this week is a great example of this approach.

I think people really liked having a second major keynote theater. So we have the main stage for the big keynotes and then we have a 500 seat theater where you can go for additional content that's much more focused on specific topics.

We face this pressure when you do an event like Sapphire. Are we focused on just the three-and-a-half days where people are physically in Orlando? Or are we focused on an experience that lets people participate in Sapphire off site, at their leisure, in their location? And increasingly, if you look at the facts, we have big numbers in terms of who shows up. We have huge numbers in terms of who participates virtually. So it's important that people be able to feel the excitement of Sapphire sitting in their office, sitting at their desk, sitting in their living room.

His favorite moments from the event

You always have to feel proud when the founder of your company takes the stage (watch Hasso’s keynote here ) . We shouldn't miss any opportunity to acknowledge that Hasso is a titan in this industry….one of the founding fathers of this industry. When he gets up there and he does what he does, there's an amount of gravitas that I think is hard to find in many other tech conferences, if any other conference.  If I'm reliving Hasso keynotes from years past, I don't think he gets the credit he deserves for the in-memory revolution. I can remember having so many conversations with analysts and others who would say, "HANA, HANA, HANA. Customers have heard enough of that." It turns out they hadn’t and Hasso has been proven right again and again. How do you build a business that's capable of operating as an intelligent enterprise if you don't have an architecture that can help you manage data without indexes and aggregates? Data from any source? Structured and unstructured? Transactions and analytics on a single platform? Everyone loves the data sound bites – new oil, new gold, new oxygen. Pick your favorite. But only one person was making this intellectual argument before it was fashionable.

Then there was the big announcement – introducing C/4HANA.  The presentation Alex Atzberger (starting 19:30 here) delivered was confidence inspiring. I think if you were watching that ... and the bar was set  “Do I believe SAP has a credible argument that would force me to rethink how I rely on technology to transform my customer experience?” I think Alex not only cleared that bar, but I think he cleared it by a wide margin. And I think there's a lot of interest, a lot of excitement around C/4HANA in the marketplace right now.

For people who really know SAP, who really watch SAP, there's the question, "Okay, are they singing from the same sheet of music if you go off and talk to a development leader who is driving the agenda at an acquired company like a Concur or an Ariba, versus what you would get from SAP’s development team?” Seeing Bernd Leukert and Rob Enslin (starting 38:15 here ) together in one conversation with a lot of passion, share the same vision for how we're integrating the portfolio of assets that SAP has assembled and create true end-to-end process capabilities regardless of the app you're using - that's a huge headline for us.  At the end of the day, if you're a customer and you’re thinking, "When I bought SAP 20 years ago, they gave me every functionality I wanted in one box. And I'm not necessarily saying I want it all in one box, I just want to believe that they have a vision to be able to cover all of the capabilities that my company needs." Rob and Bernd gave them that confidence.

SAP's increased openness

Kudos to Nicola Leske and her team who obviously focused on you as their customer. So in that way, we do look at you as a customer. But second, I think SAP, and I give credit to Bill McDermott and the executive board for this, has undergone a sea change in terms of how SAP views the analyst community more broadly. We view the analyst community as a gateway to our customers because customers are trying to sort through so much. Increasingly they look to you and to your peers to help distill it all down. If we don't help you have a complete and well-rounded view of SAP, not only from our perspective, but from the perspective of our reference customers, we're letting all of our customers down by extension. So that's an intentional part of our strategy, and I'm glad you feel it. I’d also say the same thing about Geoff Scott and the user group. It shouldn’t go unmentioned that they are the co-host of SAPPHIRE. We embrace anyone who gets the company closer to its users.

Bill always says that SAP is at its best when SAP is at its hungriest. The company culture right now, and I think you felt it at Sapphire and in the lead-up, we are very motivated because we feel so strongly about the story we have to tell. We're very much in a “don't take anything for granted” phase. I love that scene from the movie Any Given Sunday with Al Pacino. The locker room scene where he says, "You go the extra mile for that inch, to gain every inch. It’s the difference between winning and losing." We're in a mode now where SAP is going to go the extra mile for every inch. And there should not be any situation where you're asking us to help you cover SAP where we're not able to come through.

His session with Jon Bon Jovi and Bill McDermott

I thought Jon Bon Jovi was remarkably candid. I thought Bill was too, but I know Bill and I know he is usually candid. I thought Jon’s admission about facing down dark times was profound. Just imagine if one of the most successful touring rock stars of all time who can walk into a stadium of 90,000 people and get roaring applause without even singing a note. If he can feel the dark pressure of negativity in his own life, I think those of us who are working away every day trying to make these businesses run well, which at many times is not a necessarily popular thing to be doing, it’s ok for us to be honest about our own challenges. I just thought it was refreshingly human in terms of the context.

Some of the human dimensions of technology in the enterprise, I think those are underplayed. I think these are inherently human conversations. Change management is a human conversation. Introducing new concepts and new ideas and asking people to have an open mind and try new things, these are human conversations.

We do sort of the instant pulse checks on audience sentiment. The reactions to that conversation were overwhelmingly positive. And if you think about the benefits of an event like Sapphire where you bring so many people together, I think the burden on any vendor is, what can you give attendees that is a unique experience that they're not likely to be able to recreate anywhere else? If I were an attendee, I would want that standard to be met. And I don't think you could have watched what Jon and Bill talked about and not feel like you were participating in something that was pretty unique

The fact that we balanced it, by the way, with what Adaire Fox-Martin did with Adidas (here) and Jennifer Morgan did with Costco (here) earlier on that morning, I thought was really important. Because I think if we hadn't done that, I do think it would have been a missed opportunity. I thought those conversations were outstanding.

Partner feedback

I believe that they see our definition of the Intelligent Enterprise as a new frontier where they're going to have a lot of unique opportunities to help our customers extract value. I also think, to the point of your recent blog post, they recognize that there's a new bar, there's a new standard. Speed, efficiency, automating what can be automated, and ultimately delivering value in new ways….that's the pressure we all feel. If I were a partner of SAP and I sat through Sapphire, I would see a new wave of opportunity. I would want my SAP practice to be excited and motivated to focus on Intelligent Enterprise. But we also have to be really clear about what customer expectations are in this new world. I think we've made a lot of progress in the last several years. I think we're going to make even more progress in the next several.

Concert Night

I'm the oldest young man you'll ever meet. I find the concerts too loud in general, so I just stuff earplugs in. So I'm perhaps a lousy person to ask. But the people who I surveyed thought Justin Timberlake put on a fantastic show. My daughters were extremely jealous that we had him there, and that they didn't get to participate. I told them they should buy some software

 

 

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SAP and Outsourcers: Fool me twice, shame on me

I am often asked why I was tough on SAP in SAP Nation. I usually correct them and say I was tough on SAP’s partners and how SAP did a poor job monitoring and managing them.

I must say I groaned when I saw the SAP announcement where it plans to team with Accenture, Capgemni and Deloitte to accelerate verticalization in specific industries. I saw the tall signage of the partner booths at SapphireNow and went, Here we go again.

If SAP needs design input on the automotive sector, especially Tier 2 and 3 suppliers, they would do far better to watch this Plex keynote and work with the likes of PTC and Kors Engineering. They have so many customers in Germany which have been pioneering Industrie 4.0 projects – we wrote about several in The Digital Enterprise. If they want to hear about automation in the oil and gas sector, they should ask for time with David Truch at BP, one of their customers I profiled in Silicon Collar. He described pioneering work with robotic crawlers on rigs and drones to monitor remote locations. In The New Polymath I had described some of BP’s sensory networks going back over a decade – way before the term IOT was coined. If they want to hear about innovation in process industries there are so many innovative pharma, food and chemical companies in their customer base they can learn from. If they want grey hair on cloud implementations they should scour the Salesforce and Workday ecosystems.

Not saying they should not leverage their bigger SI partners but this time around they should expect much more automation in implementations. Oracle just announced their Soar offering which automates several steps in a migration, and I think SAP should push its SI partners to develop similar for migrations from ECC to S/4HANA.

Finally, I hope SAP systematically monitors its partners a lot more this time around. There are so many partner management tools, scoring tools,  and yes, they should tap into the collective memory of so many botched projects and unhappy clients from the last round to remind them they have to do better this time.

BTW President George W Bush dispenses the advice better than the title of this post does

SapphireNow: Event Scorecard

Readers know I prefer going to vendor analyst summits compared to user conferences. I feel like I am intruding on customer time and access to vendor execs at the latter. But in many ways, SapphireNow last week managed to bend laws of gravity and as a result I really enjoyed the conference. Here is a post-mortem:

Pre-briefings – A-

I offer vendors the opportunity to provide a sneak preview on the blog. In the past Oracle and Workday have availed of that. I offered SAP that opportunity but we could not make that post happen in time. In exchange, however, SAP had a series of pre-briefings under NDA. A full day in NYC, and several phone calls in prep for the Orlando event. Impressively, they actually listened and modified some of their presentations based on our feedback.

Customer Access - A

I was blown away by the number of customer meetings SAP set up either one on one, or in small groupings of analysts. The one negative is that filled up my agenda and I could not attend some customer sessions or meet folks on the show floor I would have liked

Vendor Executive Access – A+

Having time with vendor executives tends to be elusive for analysts and media at user conferences. Yet, I was with Hasso Plattner in the same room three different times for a total of 4 hours! That’s a new record for an event. Other executives were available for several sets of panels or small group meetings. And the SAP AR staff tried really hard to set up even last minute meetings we asked for. I hate to think how exhausted the poor executives were given the customer meetings and social activities they are also expected to grace at such events.

Hotel and conference logistics – B-

Even for a Floridian, Orlando this time of the year can be miserable so I really appreciated staying at the Hilton with a covered walkway to the Orange County Convention Center. I also appreciated being warned the wifi at the OCCC was poor and the keynote theater a bit cramped so I watched couple of the keynotes in my hotel room and took screen shots of slides. BTW Shame on the OCCC - SAP has been a loyal, highly visible patron for a decade now and to not have decent wifi is inexcusable. I hope the SAP events team have an SLA with the OCCC and get some credits for future events there. As a balance, the catering at the OCCC was surprisingly good. Well stocked coolers and coffee stands and the meal buffets had enjoyable diversity. The open floor layout which has become standard in most industry events these days hurt SapphireNow this year. We had too many meetings where people had to scream to be heard.

Social activities – A

The best evening by far was a small group dinner our AR coordinator, Stacey Fish organized. I skipped most parties but enjoyed some quiet time at one that Franck Cohen threw with some of his friends from Cirque du Soleil. I tend to avoid concert night – usually past my bed time to be terrorized by the strobe lights and throbbing subwoofers. But I went this time to humor my daughter who has grown up with Justin Timberlake. Stacey managed to get her a ticket. The logistics of ferrying the audience to the Amway Center were impressive. The show itself : I was pleased to see everyone having a good time, but yes I did miss my nap and I was terrorized by the strobe lights and booming subwoofers

Will SAP lead the next generation of enterprise applications?

Franck Cohen, President SAP Digital Core & Industry Solutions, presented the slide below at SapphireNow last week. He did not spend much time on it and I would likely have not thought much of it if he had not shown it in an earlier meeting. It is a simple slide yet could herald the next generation of enterprise apps. I have taken his thoughts and added my commentary.

Digital Age UX

I had a chapter in the 2010 The New Polymath about emerging interfaces.  It’s taken a while, but at home we are getting used to digital assistants like Alexa. In our cars, we are starting to feel haptic interfaces and get comfortable with heads up displays. On the shop floor (see this Plex keynote) we are moving to digital capture, wearables and AR/VR. (and the Kopin WhisperChip described there should make voice interfaces work even in noisy environments). During the Super Bowl earlier this year, I was struck by a Dr Oz commercial where he described how wondrous the five human senses are. The enterprise is (finally) starting to recognize that and diversify beyond the keyboard and mouse.

Automation

In Silicon Collar I described how BP is using robotic crawlers on rigs and drones for pipeline inspections, how KPMG is redefining audits with cognitive computing, how digital agencies like Grok are using CGI, how Amazon is leveraging Kiva robots in its distribution centers, how banks are using RPA and many other man-machine combinations. No profession or business process is exempt yet amazingly enterprise software has been somewhat oblivious to this automation-everywhere trend.

Next-gen processes

Today’s cloud solutions have mostly taken features and functionality forward from the last wave of client/server ERP, CRM, EAM etc. They have adapted to compliance driven changes, but not so much for business model and practice changes.  And they have mostly tackled horizontal accounting, HCM and CRM functionality.

So much has changed in the last two decades. If you are a utility your billing needs to factor net metering where your consumers are selling power back to the grid. If you are a retailer you deal with your customers across multiple channels, through countless delivery methods and have to adjust to reverse logistics like you never did in the past.  If you manufacture, your bill of materials has a lot more silicon and software as products become smarter. You have plants around the world close to your major consuming markets.   In reverse, you may also be dealing with contract manufacturers. If you are a CPG company, your marketing budget is increasingly digital and social but you still have plenty of analog spend – radio, print, billboard, events. HR processes – recruiting, training etc. – appear oblivious to the fact that only 10% of the US civilian work force now works for the Fortune 500. No, the rest are not contractors. The talent is in their supply chain, in their service firms (accountants, attorneys, advertising firms), on their platforms, in their franchises etc. We need new processes to track and develop this very widespread talent base.

It’s nice to hear Franck lay out his vision, but can SAP wake up Rip Van Enterprise Software from its 20 year slumber and catch up to modern business? It’s not like SAP’s performance has been stellar in the same period

• SAP has often been distracted by infrastructure and platforms, not applications – NetWeaver, Sybase, HANA have taken a lot of attention.
• S/4HANA is largely a re-skinned ECC. It has not pushed the ball forward on new functionality. It has not even begun to focus on industry book of record functionality.
• SAP has been timid about cloud computing. Its acquisitions – SuccessFactors, hybris etc have brought it cloud revenues, but the majority of customers are still on on-prem software. Early S/4HANA adoptions have been mostly on-prem or in private cloud
• It continues to be very dependent on its traditional SI partners who themselves missed out on the many new trillion dollar markets which have emerged in the last couple of decades.

Yet, for the first time in the last several years at SapphireNow, as I wrote here, I felt some optimism about the application vendor buried in that organization. Maybe that will spur some more action in the competition.  Oracle has appeared to be more interested in catching up to Amazon and Microsoft in the IaaS market than in growing the application footprint. Infor had a grand vision of servicing several verticals but has been slow to do so. Workday is highly focused on finance and hr, Salesforce on its somewhat narrow vision of CRM.

The biggest strength for SAP is its customer base across industries and geographies. My books have cataloged many of the innovators in that base. The opportunity awaits to turn their innovation into application features and functions.

Will SAP grab it?

Oracle Soar: “The Last (Application) Upgrade you will ever do”

In 1991, I was assigned a team at PwC to build something called “2O to 3O”. Dun and Bradstreet Software, especially its McCormack and Dodge (M&D) unit, was an important practice area for PwC. M&D had released a new General Ledger 3.0, a product with a multi-dimensional code block and a number of other new features. They did not, however offer 2.X customers any upgrade software to get to 3.0. The thinking was the new product was so different, customers would re-implement. At PwC, we sensed an opportunity to develop a mostly automated solution - we ended up with a PC based configurator, a set of mainframe migration programs and a consulting package.

My team was surrounded by cynicism. Feedback from M&D was it would be too difficult, we were wasting our time. Feedback within PwC was why are we cannibalizing our service opportunity? Anyways we got it done (the master and transaction files were relatively straightforward, the control file where you stored allocation, report writer and other specs far more complex) but in the mean time, the market had moved. Clients did not want to migrate to another mainframe product. Indeed D&B itself has announced its Smartstream client/server product and that froze customer interest in 3.0. Ironically, having shown we could build a migration product, D&B called us a short while later and asked us to help them build migration tools to Smartstream. That is another story but I have always wondered why software vendors do not think of automated migrations when they design next-gen products.

So it was nice to see Larry Ellison present last week a modern day version of an automated upgrade that my team had developed. Its called Oracle Soar (to the Cloud) and the components are in the graph below.

The Soar functional scope is much wider than the General Ledger we focused on, it is going from a client/server to a cloud platform, and there are lots more client/server customizations to sunset – so it is several times more complex.

And I love the marketing pitch – it is the “last” upgrade customers will need to spend much time on. Later upgrades in cloud settings are handled by Oracle, in background.

My questions

- why did it take Oracle so long to develop this?

- why are other vendors not writing these for their products, and even those around legacy products of competitors?

- why are systems integrators, while bragging about automation projects at customers, not building these?

I know the answer to the last one. The SaaS model has shrunk hosting, application management and upgrade services that were lucrative in on-premise world. Implementations remain labor intensive and are good for business if you want to continue to sell rate-card based services.

The reality, as I showed in multiple case studies in Silicon Collar, is automation makes your workers smarter, speedier and safer. Automated migrations are clearly speedier. They also allow your consultants to focus on smarter, more creative work. And they are safer – at least in that they give you an advantage over competition which continues with hand to hand combat.

So, I hope other software vendors and outsourcers follow the Oracle lead here. 

BTW, spend the 40 minutes Larry Ellison, Beth Boettcher and Steve Miranda spend discussing Soar – worth your time even if you are not an Oracle customer.