deal architect

Zoho Day: The long shadow of Amazon

When I visit a vendor after a couple of years I measure how they have changed along 4 vectors – product growth, geographic expansion, change in customer base (going after larger or smaller customers) and vertical capability expansion. At Zoho Day last week, I picked up another vector – the Amazon vector. More about that later.

You knew it would be a different couple of days because CEO Sridhar Vembu was not hobnobbing, unlike many of peers, in Davos. He was greeting us in jeans and untucked shirt. 

Product Vector

The product portfolio continues to grow at a remarkable rate. Raju Vegesna presented under NDA an update on the upcoming Commerce offering. On each planned feature he spent maybe 30 seconds on would take 10 minutes in other vendor briefings. As Sridhar said “The cloud app development has become objectively easier. I mean we've been in the software business for 32 years, so I know. There are a lot of infrastructure pieces that have been figured out more and more and more. And it is becoming easier and easier and easier. I saw a figure for 30,000+ VC funded cloud startups in the world now. In December, it's even harder to pin down because it's global and there are integrators everywhere.”

The image below shows some of Zoho applications. It does not include coverage of two sister companies, ManageEngine which focuses on IT Management and WebNMS which started off with a network management focus and now has an IoT, smart city infrastructure focus.  The latter two also shows in Zoho’s comfort in running its own data centers which it claims are more efficient than procuring from hyperscale providers like Google. The registered user growth has averaged 37% over the last 5 years, and is now over 40 million worldwide. 

Couple of analysts said Zoho seems to only deliver “minimum viable product” – if that’s good enough for its customer base what’s wrong with that? Besides, it reflects an agility as Zoho can bundle a variety of services it has been growing over the last decade.  The prime weak areas, to me, today are in HCM and in Asset Management. 

Geography Vector

Zoho is experiencing strong growth across most major economies and has 7 data centers to mirror them, and shows up at over 170 trade shows around the world. It is unafraid, unlike so many US cloud vendors who are reluctant to expand globally.  Indeed, only 42% of total revenues now comes from the US (down from 53% in 2012).  Sridhar said “We opened Amsterdam, Singapore, Dubai, Mexico, and Australia last year and some more are coming this year.”  It wasn’t just talk.  He had flown many of the employees for the couple of days. I met several from Pleasanton (the HQ) and Austin (fast growing US campus), from Chennai (still the development hub) and Delhi in India, from Utrecht in Holland, Kanazawa in Japan and New Zealand. 

Customer Size vector

Zoho keeps moving up market in terms of customer size – to the extent it can do so without a direct sales, and SI ecosystem model. Two customer executives presented at the event. Julie Doris leads Customer Service at Rain for Rent (drainage pumps, water tanks and services for farming, fracking and other markets). Tarun Raisoni is co-founder and CEO of Rahi Systems (solutions for data centers and corporate campuses). Both are private but Rain has over $500 b in revenues and Rahi has over $150 b. Neither is a CIO but both were impressively knowledgeable of product features and relentlessly focused on value from software. As Julie said “I don’t let Gartner Magic Quadrant placement influence my decisions too much”. Tarun, in response to a question, said “we have not done an ROI analysis – yet”. Honestly, at Zoho’s price points, he may not need to.  Certainly, those two customers are a far cry from the Small Office, Home Office (SOHO) segment that ZOHO was originally named after. Zoho is grappling with whether it needs a Toyota/Lexus type branding fork. 

Vertical vector

The one area they have not grown is around verticals. I later had a one on one conversation with Sridhar about “white spaces” to consider. The big difference – when I talk to other software CEOs they either tell me they don’t have bandwidth to verticalize, or others are content with the few features they do have. They appear convinced these features can satisfy the need for vertical operational “books of record” like insurance claims processing or clinical systems. My concern with Sridhar is he will rush off and commit to multiple industries. He is completely unafraid!

Amazon vector

There is a fifth vector that Zoho has also been executing along. It’s the Amazon vector. The Zoho team is preparing for the day when Amazon decides to become an enterprise software, not just an infrastructure, player. The Bezos motto of “your margin is my opportunity” puts the margin rich software industry at risk. Software margins remain very high but the industry is not efficient.  Sridhar: 

            You can see that the enterprise cloud vendors are even more sales and marketing intensive    than traditional information software companies and those were already quite sales and marketing intensive to begin with. This is something that is unexpected because, if you look at the whole SaaS cloud revolution, it was supposed to deliver us from this exact problem: focus more on software and not so much on the facility of it.  50% of their revenue is spent on sales and marketing; 50% is now considered just normal. And 70% is not uncommon at all now.    

            We are spending tens of millions of dollars in cloud infrastructure, all of these storage servers. We know how the costs have come down. In fact, something like those are not even possible if not for this development.

            Yet, ask yourself, why is it that somehow enterprise software prices only go up? Why don't all these prices keep coming down? There are also substantial … software in all of these. I mean look at networking. That is mostly software now. Somehow, all of those industries are subject to one kind of economics. But when you come to enterprise software, the economics seems to change.

An example of that thinking comes from Zoho One , the bundle priced at $30 a month an employee, or $75 a month on per-user basis. It was launched in 2017 with 35 applications, it now has over 40.  And from the presentations we heard more apps will join the bundle. A dollar a day per employee is a compelling value proposition, when the functionality keeps growing exponentially.

I have known Sridhar for nearly 15 years, and this awakening did not happen overnight. In 2006, he wrote a guest column for this blog which explained his pov:

“Personal computers made computing ubiquitous in the developed world.  Mobile revolution has swept the globe, with hundreds of millions in developing countries making their first phone call in the last decade….Yet, in the world of corporate IT, the low-cost revolution is very much unfinished business….most of what enterprises pay for software goes towards funding the marketing budgets of vendors. This seems like an universal law that is applicable regardless of whether the vendors have open source or proprietary models, and even extends to on-demand business models.”

He has long avoided the VC funded model, following instead the cash flow funded growth at companies he admires like Microsoft. He says the prevailing wisdom in Silicon Valley is "Just raise the most, spend the most, and just conquer a particular market segment." He has studied Ikea and Trader’s Joe, not just in how they have thrived even as Amazon decimates other retailers. “They provide a human-provided customer experience. Right? If you go to Trader Joe's, people are smiling. You can tell it's a fun place to shop.” He has also looked into how they have stayed private or adapted unique structures like Ikea's and preserved their DNA. His philosophy:

 “We'll stay true to ourselves. Stay hungry. Stay foolish. But we can only stay hungry and stay foolish if we are staying private. If you go public, a lot of those things just go out the window.”

He has a unique recruiting model which again goes against the grain of the industry and yet generates unbelievable employee loyalty. As I wrote in 2016

“Average tenure of employee is 10 years. 146 out of 150 managers have never worked anywhere else. Most executives we met wear several hats. None of their business cards have titles. They waste very little time in team meetings. 20% of their engineers do not have degrees. Focus on promise more than formal education helps Zoho recruit in India against the giant outsourcing firms where the majority of his development is done. “

Besides preparing for the Amazon onslaught, Zoho has adopted some of its business practices. The more I heard of Zoho One and the growing apps coverage for the same price, I thought of how Amazon Prime has grown in coverage. It started off a free 2 day shipping, then added free movies and since then countless new features. AWS delivered 60+ price cuts in its first decade - almost as if they were listening to Sridhar. 

Amazon may never enter enterprise software, but Zoho wants to be ready. Sridhar is too modest to say Zoho is disrupting the industry, but in my eyes, he already has. He has given me another vector to measure software vendors against.

SAP Nation 3.0 - cover input, please

Would like reader input on some cover concepts I am being shown as we approach the end of the book edit cycle and move into the design phase.

Do you like the one on top or bottom? Below is the context for the US wagon trail, westward expansion metaphor.

Thanks for your input.

"Welcome to the third volume of the continually unfolding saga at the world’s largest application software company. When I wrote the first volume of SAP Nation, five years ago, SAP looked vulnerable. Besides runaway costs and massive project failures at some customers, SAP appeared preoccupied with its HANA database and almost bored with enterprise applications. Much more concerning, a wide range of competitors was circling around. Indeed, right after S/4HANA was launched in early 2015, co-founder Hasso Plattner was quoted as saying, "If this doesn't work, we're dead. Flat-out dead. It's that simple.”

As this book will show, Dr. Plattner's worst worries have not materialized. S/4 has not been a runaway success but SAP's competition has not exactly gone for the jugular either. SAP's product portfolio and customer base has grown significantly and the stage is set for the next few phases.

The setting today is similar to that when the young nation of the United States acquired Louisiana from France in 1803. Real estate area instantly doubled, but the population was still mostly concentrated along and around the Atlantic Coast. SAP's product real estate has similarly grown, but the majority of its over 400,000 customers are clinging to their previous "homes." Migrating this customer base is SAP's first big opportunity.

In addition, even bigger opportunities await. The U.S., energized by a Manifest Destiny call, expanded all the way to the Pacific Ocean. SAP has missed out on many markets in the last two decades. With its own version of a Manifest Destiny call, it can dream much bigger. New vistas await from sea to shining sea across the continent of enterprise computing."

Update: I am glad I asked for feedback. Couple of you suggested I continue with the design of the previous 2 books in this series. There is something soothing about continuity, and the neutral tone does not distract from the words on the cover. So, I have another choice to consider.

 

“You don't get a PaaS just because you're SaaS."

Apologies to Frank Scavo for twisting his quote  “You don't get a pass just because you're SaaS." but this is a reaction to the trend that every cloud application vendor is offering a platform and actively recruiting developer communities.

I get the central principle  – configure in SaaS, but customize in PaaS. Keep the SaaS core clean. I also get the need to give business users productivity extensions, better analytics, low-code capabilities.  What I don’t get is why we are encouraging another generation of major customizations.

Here are several angles to consider:

Several cloud vendors are pointing to retirement of on-prem customizations as justification to move to their apps. Don’t new cloud based customizations take away from that ROI? SaaS is about the efficiency of multi-tenancy. By definition, customizations are single-tenant. They dilute the SaaS value proposition.

Customers don’t generally customize for the fun of it. Customizations are a result of holes in delivered application functionality. After two decades of SaaS, 80% of the corporate applications across global markets and industries still do not have much choice in the cloud. Maybe vendors should be investing more in SaaS, not PaaS? If your platform is so darned good, how come your developers are not 3x or 4x more productive and you multiply that productivity by coding that functionality once for thousands of customers?

The last generation of customizations was treated leper-like by software publishers. Vendors refuse to handle tickets which touch on customizations. This is one of the main reasons so many customers have moved to third party maintenance providers like Rimini and Spinnaker. Even more so than better economics, it is for their support of customizations. Will we see similar around PaaS?

Vendors argue that their ecosystems deliver lots of application functionality using their platforms. The reality in enterprise world is that lots of noise, not enough result. SAP must launch one of those stores every year – around HANA, around mobile apps, now in its AppCenter. Many folks will point to Force.com as a huge success. Huge success? It was launched around the same time as the Apple iOS store. There are now 20 million Apple developers creating apps and importantly Apple has paid out US$100 billion in revenue to these developers. How much have Salesforce partners made selling new apps in the same time period? Or compare to Fulfillment by Amazon. As much as 90% of certain product categories such as patio furniture sold on Amazon come from third parties. That’s validation customers are buying from platform partners. I don’t see enough of that around enterprise platforms.  

Much of the excitement in developer communities these days is around cloud infrastructure, open source, and machine learning. Most PaaS from SaaS vendors provide ML gateways to Tensorflow or the PyTorch community. While these higher level services are useful, you have to be a bit wary what future licensing complications they are exposing customers to. Besides, shouldn’t PaaS bring its own value for the pricing vendors expect?

The  enterprise software industry has been blessed with brilliant technology architects – Larry Ellison and Thomas Kurian at Oracle (Thomas now at Google), Dr. Plattner at SAP, Parker Harris at Salesforce, Stan Swete at Workday among others.

In contrast, it has not had enough of what I call business process visionaries. So, Jeff Bezos of Amazon does not look to them for leadership when it comes to next-gen distribution centers. Manufacturers look up to what McKinsey calls Lighthouse examples. I cannot remember the last time a customer exec told me he/she found inspiration for the hospital or retail store or lab of the future from a application software vendor. Perhaps we need a rebalancing in vendor R&D. More of a functional focus.

Let me pull in an analogy from the food sector. You go to a restaurant you really like and the chef says we have changed our business model. We are only serving semi-cooked meals now. Enjoy the meal at home. Or come on in, but be aware we are now offering grills. You bring your own ingredients and cook your own. That’s a bit of SaaS vendors are doing with PaaS. 

My 2c - we need better SaaS, not more PaaS - at least not PaaS from SaaS vendors!

Infor: a fork in the road

Congratulations to Infor for the new funding and potentially more when they go IPO. Here is today’s announcement:

“Infor, a global leader in business cloud software specialized by industry, today announced an agreement to receive a $1.5 billion investment from shareholders Koch Equity Development, LLC (KED) and Golden Gate Capital.

This investment builds on KED’s investment of more than $2 billion in early 2017, and it represents an important milestone as Infor considers a potential IPO in 2019 or 2020, subject to market conditions.”

My question is will Infor truly deliver on the “specialized by industry” promise it makes above. It has been making that promise since Charles Phillips and team took over in 2010.

As I write in my (unfinished draft) of SAP Nation 3.0

“Infor had once been called an "ERP graveyard," as it had accumulated a wide portfolio of ERP brands including Baan, Lawson, MAPICS, SSA Global Technologies and Systems Union. Those in turn had made acquisitions of their own (such as Lawson buying Intentia). Since they arrived in late 2010, Infor CEO Charles Phillips and his team have been reinvigorating the company. Phillips called Infor the “world's largest start-up". The differentiation Infor promised was "CloudSuites" for 15 verticals (such as automotive, retail/fashion and food & beverage) and three horizontal ones (including corporate and human capital management).

Of SAP's competitors, Infor looked promising as it leveraged Amazon's cloud infrastructure and invested the savings into vertical solutions for healthcare, hospitality and other industries. A decade later it can boast improved look and the integration across its large portfolio of products , but it has not delivered “books of record” for industry sectors.

Larry Ellison famously derided dot com startups as “features, not products” in the early 2000s. Infor, similarly has features for a number of industries but has not delivered “books of record” such as electronic patient records for healthcare. In fairness, neither has Ellison's Oracle delivered cloud-based vertical functionality.”

With vertical functionality, Infor will have a much better shot at migrating its 70,000 customers to contemporary solutions. It has tried, with limited success, with initiatives like UpgradeX. Customers who stay with legacy systems are showing more interest in going back to best of breed strategies and looking at cloud vendors like Workday and Salesforce in HCM, accounting and CRM silos.

So, I will be interested to see if with the new funding, Infor goes back to an industry focus. In addition, I wonder if it will start to look at wave 2 of projects in many markets most ERP and CRM vendors  have missed out on in the last two decades. As I write in the book:

“In 2000, enterprise tech vendors led by SAP, other ERP/CRM vendors and their SI and other partners were set to dominate the corporate technology landscape. Instead their share of the enterprise has steadily declined. They have missed out on contract manufacturing of smart products, digital marketing, cloud infrastructure, industrial internet, process automation and several vertical niches. Two decades ago, few of us had heard of Accenture Interactive, Foxconn or Google. Few of us considered Amazon or GE as tech vendors.” 

Oracle's stretch goal for its applications?

Mark Hurd tells Bloomberg

 “In fact, the highest application percentage of any company in any segment is sort of mid-20s. This generation will see a leader that’s much more material than that, and I volunteer us to do it.”

I would love to see that. Listening to Mark Hurd at Oracle OpenWorld I wrote

“After two decades of cloud applications, we have lots of choices in horizontal apps, very little in industry books of record. As a result, by my estimate, only 20% of enterprise apps have moved to the cloud. That’s in the US, the ratio is even lower in Europe and Asia. Unless Oracle and other vendors start investing in cloud versions of industry apps, Mark’s prediction that 80% will be in the cloud by 2025 looks very ambitious.”

I have studied the last two decades of enterprise software trends for my upcoming SAP Nation 3.0 book, and the best that can be said about Oracle application performance is it has been erratic. Here’s some of what my unfinished book describes about Oracle applications

“By many measures, Oracle should by now be the undisputed leader in enterprise applications. When Computer Associates was on a buying spree in the 90s, Oracle founder Larry Ellison had commented something along the lines of "every ecosystem needs a scavenger". Starting with the PeopleSoft acquisition in 2004, Oracle went on its own binge and claimed it was time for an "industry consolidation". They made significant acquisitions - PeopleSoft for US$10.3 billion, NetSuite for US$9.3 billion, Siebel for US$5.6 billion, Micros for US$5.3 billion, Hyperion for US$3.3 billion. Others like i-Flex, Portal and Retek brought them banking, telecom and retail applications. By 2006, they were loudly celebrating that they were "half way there" in developing their own next-gen Fusion cloud applications.

For all that, Oracle has done just ok. It has appeared more interested in going after Amazon for the cloud infrastructure and platform markets. That has yet to pay off - the top 4 cloud infrastructure players Amazon, Microsoft, Google and Alibaba have nearly 3/4 of that segment sown up. Around business applications, it has focused more on Workday and Salesforce with HCM and CRM functionality and not so much in manufacturing or other verticals where SAP has greater presence. Its NetSuite acquisition, while helping it increase traction with SMEs, has also led to some brand confusion around its own Fusion product line. While, it has launched an exciting autonomous version of its database - it calls it "self-driving", it has not brought a similar level of automation to enterprise applications.”

 As the book says, the market is getting more fragmented by the day

“In 2000, enterprise tech vendors led by SAP, other ERP/CRM vendors and their SI and other partners were set to dominate the corporate technology landscape. Instead their share of the enterprise has steadily declined. They have missed out on contract manufacturing of smart products, digital marketing, cloud infrastructure, industrial internet, process automation and several vertical niches. Two decades ago, few of us had heard of Accenture Interactive, Foxconn or Google. Few of us considered Amazon or GE as tech vendors.”

and

“The next decade will allow SAP to further reinvent itself and take advantage of wave 2 in many of the markets it ignored in the last two decades. Can it? Will it have its own Manifest Destiny call to go from ‘sea to shining sea’?”

I would similarly welcome an Oracle more focused on business applications. The Western front is waiting to be tamed.

Done Right - a book review

I was in Shanghai, China recently. As I have told my friends, I ended paying a “tourist tax” everywhere. Moneychangers, gypsy taxi drivers, tour guides who took me to pearl and silk stores where I am sure they got a cut. Part of me was irritated, part of me glowed – it is so nice to see young men and women hustling and bustling. It feels so alive.

Coming home, I saw protests, I saw whining on TV. Felt like a different world where work ethic is dying. Of  course it is not, but the contrast was striking.

When I wrote Silicon Collar two years ago, I got an exciting view of how drones and wearables and 3d printers and machine learning are reshaping every business process in every industry. I also got the flip side –academics and analysts using the fear of machines to unnecessarily scare workers. I saw how the economy has ended up with 6 million unfilled blue collar and trade jobs and in contrast, graduates with soft white collar skills for which they should never have racked up $ 1.5 trillion in student debt. 

With that backdrop, I am so glad to be reading Done Right by Workfront CEO, Alex Shootman. He cites various leaders who have motivated employees and cite terms like Commander’s Intent. Like Tom Watson Sr, founder of IBM. When an executive resigned after a $ 10 million error. Watson told him “You cannot be serious. We have just spent 1o million dollars educating you!” Or the encouraging note he got while at BMC when a quarter cratered as a result of the US –Iraq war in 2003.

He profiles workers who love their work. Examples like the 300 Call Syndrome. 911 call handlers tell about being alert to detect that one different call which invariably comes after hundreds of routine ones. And he recognizes Millennials like Jen Gilligan, who at the drop of a hat will head across the world seeking a more meaningful life. Reminded me of my daughter Rita as she crisscrosses SE Asia.

It is impressively short – only 135 pages if you leave out the footnotes and credits. Each chapter does have an exercise including one which pulls it together – the Done Right Value Pyramid. 

It is a smooth, easy read. No fear of machines. No snarkiness.  Not much bragging about himself or his company. He has half a page at the end about Workfront. How rare is that in today’s hyped up vendor marketing world? That right there, makes me want to learn more about Workfront.

Get yourself a copy. And when you read scaremongers talk about jobless societies and encouraging our young workers to seek out the utopia of Universal Basic Income when the economy is screaming for their talent, crack it open

The book is a pure celebration of the joys of work and work ethic.  For eons humans have found dignity through our work. Many of our family names continue to honor our occupational legacy. 

The book is about the future of work - enjoyable and rewarding work.

A brief history of the 21st century: The Enterprise Tech chapter

People in our industry like to call themselves futurists. My glasses don’t allow me to look that far out. My books have, however, forced me to become a pretty fair historian. In The New Polymath I looked at Renaissance Men and Women like Leonardo da Vinci over the centuries. In Silicon Collar, I looked at automation and impact on jobs over the last 100 century – how UPC scanners, bank ATMs, cruise control in cars and other automation was gradually absorbed by society.  From the bread crumbs I lay out, I think my readers are smart enough to plot their own future journeys. My clients get a bit more guidance in the form of advisory support.  

For SAP Nation 3.0 I studied and bring out in the book, 3 periods of history

a) SAP and its competitors in last 5 years since the first volume of SAP Nation

b) The broader enterprise tech industry in the last two decades

c) The US westward expansion in the 1800s. I use that to contrast missed opportunities by SAP and others in this century

Over the next 3 months as the editors and designers finalize my book for release, I will be sharing perspectives from my research.

In the meantime, here are some pre-edit extracts for each of the phases

a) “Partly because its competitors did not target it aggressively enough, and partly because SAP’s own cloud acquisitions and developed products allowed it a shield, SAP has come through the threat of the last five years relatively unscathed. In fact, when you look at the mob of strong competitors that it had to fend off, and the many unforced errors it has made, it has done remarkably well. In those 5 years, SAP’s customer count has actually increased by 50%. Wall Street has not been as generous to SAP, as it has to cloud vendors, but the existential threat that SAP faced has passed.”

“Watching Bill McDemott stay so calm can be misleading. This is not your Dad's SAP - not by a long shot. In this chapter, we saw some of the changes in the SAP field, in their marketing, business operations, development and partner management. And these executives are just a small handful of the 90,000 worldwide SAP employees. The pivot at SAP in the last five years has truly been massive.”

b) “In the year 2000, enterprise tech vendors, especially ERP/CRM vendors led by SAP , their SI and other partners were set to dominate the corporate technology landscape. They had emerged very strongly from the Y2K crisis and the launch of the EU common currency promised another bonanza. Instead, their share of the enterprise has steadily declined over the next two decades. They have missed out on the contract manufacturing of smart products, digital marketing, cloud infrastructure, industrial internet, process automation, vertical niches like Fintech and several other trillion dollar markets. Two decades ago, not many of us had heard of Accenture Interactive, Foxconn or Google. Few of us considered Amazon or GE as tech vendors. The market is fragmented - waiting for a leader.”

c) “In Chapter 1, we described the Louisiana Purchase. It was a major risk for President Jefferson but it doubled the real estate of the young U.S. What if the population had just yawned and clung to the Atlantic Coast and not moved to the new territories? That's a good analogy to what SAP faces. It has new real estate in the form of S/4, Leonardo, SCP, HANA and its cloud properties and yet the majority of its 400,000 customers are clinging to the "coast" of legacy products. Helping them migrate is SAP's major short term opportunity.

Lewis and Clark then opened the country's eyes to real estate way past the new boundaries created by the Louisiana Purchase. Successive Presidents arranged to grow the country's real estate all the way to the Pacific. That's the even bigger, second opportunity for SAP and other enterprise vendors - become a Fast Follower in many markets they missed out in the last two decades. “

Over the next 3 months as the editors and designers finalize my book for release, I will be sharing perspectives from the research. The majority of the book is in the voice of SAP’s customers, executives, competitors and analysts.

It is an exciting and a turbulent time for enterprise tech. From SAP GUI to digital assistants, from ABAP to Python, from on-prem to Kubernetes, deprecating old customizations and creating new ones with platform and open source capabilities, new vertical and global functionality. New generation of developers, outcome based business models, new challenges. 

As usual, I am just the historian. From the bread crumbs I lay out, I think my readers are smart enough to plot their own future journeys. My clients are already starting to get richer guidance.  

A key word for 2019 - authenticity

Happy New Year to all my readers!

I have spent the last month extracting from hundreds of pages of transcripts of my interviews for SAP Nation 3.0. I am struck by the frank comments from so many customers about SAP, its partners and its competitors. They realize these will be read by their peers at other customers and I appreciate their willingness to share. I know some of the comments will be used for competitive advantage. Fair warning to folks in the field – if you use it that way, bear in mind I have similar access to your customers and information about your products :)

Similarly, reading my notes from meetings with Franck Cohen, Rob Enslin, Nick Tzitzon and others at SAP, I see an openness which is refreshing. I give credit to Stacey Fish, my contact at SAP. She sets up calls/meetings and mostly observes even when we may be ganging up on her execs. She may ask me what I thought afterwards, but rarely does she push an overt agenda.

So, here is my request of other vendors – converse more with us, don’t just pitch. Don’t just outbound communicate to us,  invite our inbound requests. Open up more access to your customers. I love how Plex invites us to join their Customer Advisory Board once a year. If not,  not to worry, we can access customers through many other channels.

But do encourage your execs to be authentic. On that point, I see a trend for executives to talk about corporate “purpose”. I admire executive commitment to diversity and social good, but in the end as an analyst I am expected to focus on  functionality, architecture and economics. When I talk to customers rarely do they say “corporate purpose” was the reason they selected a vendor. It may have been a tie breaker, rarely a item which counts for more than 10% in their scoring matrix.  

On the other hand on functionality, architecture and economics I expect many more detailed conversations. As you will read in the book, SAP is in far better shape than people give it credit for. But SAP, its partners and its competitors have all missed out on many, many market opportunities in the last decade.

It’s a new year, and a very new market. Look forward to many more conversations.