deal architect

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.

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.  

SAP's evolving partner economy

Ask about who has had a successful platform strategy, and most people will point to Salesforce. I beg to disagree – compared to revenues Apple has generated for its partners and itself from its iOS store and Amazon with its fulfillment engine over the last decade, Salesforce is a distant laggard. While customers have built plenty of custom objects, the revenues generated by ISVs on the platform is relatively small. Still as enterprise software goes, Salesforce stands out.

Ask who has had a good reseller channel and people will point to Microsoft and HP. I cannot disagree with that. They do not not get much recognition but SAP’s reseller channels around its BusinessOne and BYD products would get more recognition if they were independent units. Instead, they are dwarfed by SAP’s powerhouse direct sales engine which is the envy of most enterprise competitors.

That SAP direct sales focus has also meant association with a vast ecosystem of systems integrators and outsourcers. Again, that is the envy of many competitors, but if you read the first volume of SAP Nation this ecosystem has also been a burden on the customer base. And for the ecosystem cost (which ranks alongside GDP of largest 50 countries around the world), the failure rates have been unacceptably high.

So, with all these conflicting thoughts running through my mind, I went to SAP’s Partner Summit in NYC this week. They did a good job bringing together a mix of ISVs like Hrizons (a SuccessFactors implementer which also offers complementary software), resellers, small/midsized SIs like Beyond Technologies and large ones like Deloitte. And customers like Cintas and Pregis talk about their use of old and new SAP products and the partners who helped them in their journeys.

My feedback:

It was nice to spend some time listening to Diane Fanelli, SVP describe how SAP is showcasing in its App Center a growing number of ISV offerings using tools in its Cloud Platform and Leonardo offerings. In previous attempts, SAP has tried to do similar around NetWeaver and HANA. The customer access is much more digital this time around, the Cloud Platform leverages lot more open source and the barriers to partner participation appear much lower. It is fledgling at this point in terms of revenues for the ISVs and SAP (Fanelli says focus is adoption prior to monetization). I hope they continue with her statement “the future is small, simple applications that snap into existing landscapes. You go shopping [for them] on your phone." Which also means the onus for vertical and other books of record will stay with SAP. Too many vendors abdicate heavy lifting to their platform partners.  

In my research for Volume 3 of SAP Nation, I have seen many customers use smaller SIs for their S/4HANA projects, SuccessFactors and newer SAP projects. So, it was good to spend time with Blue Marble and Nimbl at the event. I do worry that SAP continues to seek bragging rights by talking about 18,000 partners. That’s way too many. It would do better for itself and its smaller partners by ruthlessly culling the number.

SAP also continues to be enamored with its bigger SI partners. I understand their view that such partners are a channel or at least an access path to influential client executives. I don’t understand the continued lack of certification or controls. SAP’s brand suffered considerably from the overruns and failures in the first wave of ERP.

The issue is less about SAP, more about the slow evolution of SIs and outsourcers. There is little automation in their service delivery, and still way too much consultant travel. The CTO of Deloitte, Darwin Deano responded to my question with "We're 20,000 people. It's not going to completely change overnight. But I can assure you that every SAP project is benefiting from things like automation and other new ways of working”.  I would love to see much more remote delivery,  more use of automation in data conversion and testing, more use of machine learning in parameter configuration. I would also like to see much more proactive commitment to multi-tenancy and public clouds.  

Way too many SAP partners are proposing private cloud or on-prem deployment of S/4 (and possibly C/4 going forward). Not only will that continue the previous cycle of expensive ECC implementations, hosting, upgrades and application management, it will also complicate SAP’s efforts to have sufficient data in the cloud across customers to train its machines. So, this is definitely an area SAP needs to step up and guide, and if necessary, control the ecosystem. Seeding the ecosystem with more “born in the cloud” SIs who were raised with Google, Amazon, Salesforce and Workday technologies and agile methods would also be a smart move.  

Overall, it is nice to see a partner ecosystem in transition around SAP. I, for one, would like the pace of change to accelerate. And the SAP focus be on customer success and economics not just on channel revenues. Many analysts are also hoping there is a role for the recent acquisition, Qualtrix in measuring the partner experience going forward – it may go a ways to help justify the large purchase price.

Vertical Software: One Industry which has bucked the trend

Readers know I have been hounding software vendors on why they are not investing in vertical functionality. After two decades of cloud computing we have very few choices in books of record for industry after industry – utility billing,  retail merchandising, insurance claims processing, electronic medical records. I could go on and on.

One industry has, on the other hand, seen lots of investment from literally hundreds of vendors. It is the professional services sector in the form of PSA functionality. I reached out to Dave Hofferberth of Service Performance Insight to get nuggets on why this market has bucked the trend. I call him the “Godfather of PSA” – the image below is from a pioneering white paper he wrote on the market as far back as 1999 

Describe the evolution of PSA over the last two decades.

I have seen wave after wave of vendors address this market. In the first wave there were pioneers like Niku, Evolve and Changepoint. Today the names are  OpenAir (part of NetSuite), FinancialForce, Kimble and broader vendors like Deltek, Microsoft and Workday, just to name a few.

The vendors 20 years ago had a concept, but not too many buyers. In theory, PSA made sense. In reality, most professional services providers work their employees hard, so concepts like billable utilization were not something a tool needed to track, as they just worked their employees 60 hours each week. However, as organizations expanded and resources became more scarce, PS executives realized they needed a tool to manage the delivery of services so they could track all of the time and costs against tasks, or at least projects to more accurately calculate revenues and margins. PSA has become a necessary solution, just like CRM and financials. Nowadays, organizations in other industries also use PSA to manage the services component of their product-based business. Many of the PSA vendors took a break a little over a decade ago to concentrate on project portfolio management. PPM was to be the next wave, but most of the vendors realized that PSA was where they should be. There are plenty of good PPM vendors, and that market is strong as well, but PSA is a market unto itself, with different needs.

Describe your personal journey and how you came to be so closely aligned with PSA

At Aberdeen Research, I carved out a niche for myself in the PSA market because I was the analyst who brought PSA out to the market, the vendors knew for the market to thrive, it needed a lot of thought leadership, which Aberdeen could provide. Other analyst firms, Gartner, Forrester, Meta, Giga, AMR and others, continued to change the name from PSA to something else. Unfortunately, those analyst firms didn't give the time and effort to the market the way I did. In the end, I just concentrated on PSA, where other analysts might have had many other markets or technologies to work on, with PSA just being one of them. I would love to say how when I joined Oracle, professional services was Oracle’s fourth largest market, but I had nothing to do with it. It's just the company sold a lot to those organizations. Unfortunately, it was not an area they concentrated on, preferring to go head to head with SAP in all of the manufacturing, retail, and financial services markets.

But as you say you have helped hundreds of vendors look at the PSA market.  Do vendors not have the competitive intelligence to see this market is somewhat crowded compared to other verticals? Is there safety in numbers?

The world is moving to a services-based economy, and there are so many companies that do not fully utilize business solutions to run professional services. I estimate that less than 15% of PSOs use a PSA solution. Our survey shows something like 60%, however, many organizations surveyed I have worked with over the past 20 years, and are focused on improvement. All of the PSA players I know are growing in excess of 20% annually, so it is obviously a good market for them. That is why the ERP players got in a few years ago. to sell a complete suite of solutions, including PSA, to their installed base and future customers.

Why does the professional services sector get the vertical investment when other much larger industries do not?

I am not sure why other industries don't get the software investment. All I know is that I have tried to demonstrate the financial value of PSA over the past 20 years, and it hasn't been too difficult , as you can imagine increasing billable utilization by 5% annually yields an additional 100 billable hours per consultant. It's pretty easy math. I think for the other markets and submarkets to get funding, they must do similar things to justify the value of their investment. I have long considered moving some of my research into other markets, however, the professional services market keeps me plenty busy.

BTW, I am headed up to Detroit to spend a day with Plex - a vendor which is bucking the trend by continuing to invest in another vertical - the manufacturing one. 

 

Applications at Oracle Open World: a conversation with Steve Miranda

Oracle OpenWorld kicks off this morning. I am not going this year but I checked in last week with Steve Miranda, Executive Vice President, Oracle Applications Product Development about what we can expect to hear about applications.

I did not go this year because applications often get very little play in a conference where infrastructure and database dominate. After talking to him, I think I should have gone.

Steve:  There will be three main themes. The first, we're going to try to showcase and highlight just a ton of customer success in our cloud. In every keynote, apps keynote/general session--mine, Chris Leone, Rondy Ngs, Rick Jewell, Rob Tarkoff--we have at least two customers on stage with us, live customers, talking about their business benefits.

When we say customers, I've tried the best we could to actually mix it up with big customers, small customers, global customers, domestic, etc., different industries. Frankly, this time, we've got a lot of name brand customers. On stage with me will be Cummins talking about their HR cloud implementation and the business benefits they have achieved. We have Juniper Networks using our marketing and configure-price-quote talking about their benefits and transformations there. I have Federal Express on stage with me talking about their financials conversion to cloud and, now that they've done some acquisitions, talking about expanding that to their newly acquired product and really moving to a single instance cloud financials. Hopefully, the biggest part that you'll get is name brand, very successful customers running all parts of the suite in the cloud.

What we're going to make a particular point to emphasize is the readiness for really the vast majority of our installed base in a couple different dimensions. Number one is, we're at the stage now where, with few exceptions, but just about anybody you are, were we have a customer who has gone live from the cloud, so that's whether you're global or domestic, whether you're HR, CRM, or ERP, whether you're a back office Siebel, PeopleSoft, or E-Business Suite, whether you're a telco, a bank, or a manufacturer. Then you put that matrix together so it's almost impossible to have everything but, just about every matrix, we have a referenceable customer who has already done it, part one.

Part two, over the summer, as you know, we introduced our Soar program together with Oracle Consulting, which is an automated set of utilities, which help customers take the risk and cost away from the conversion and the move to our cloud.

Then the final part. This has been a long effort of not just introducing financials, but then adding supply chain, adding manufacturing, adding globalization, adding HR, payroll, adding globalizations, etc. But, at this stage, again, for the vast, vast, vast majority of our customers, we think that the completeness of our suite is there.

Part one is going to be all about customer success and how we think more customers are taking advantage of the success. Part two is going to be about brand-new products that further expand the suite. We're introducing a new public sector product around permitting and licensing to supplement public sector, state and local, in their traditional finance area. We also introduced a brand new customer data platform in CRM, so a centralized customer data store and repository to sit right in the middle of our CX product suite.

Then, of course, we've expanded our higher education offering. Earlier in the year, we did an acquisition of a company called Vocado, which is a student financial aid system. Added that to brand new offerings we have in our student system that we've built organically here, which tightly integrates with financials and other parts.

Then in financials, we added another product called Subscription Management. More and more customers are offering services, so we added subscription management for the billing, collections, AR part, which is supports organizations across industries.

The third area we're focused on is the technology innovation and that's all going to spiral around machine learning. Machine learning, you'll see it take part in three different flavors.

The first is kind is brand new apps, if you will, or mini-apps or features. Next best offer, we have customers live on, next best action and service, things you would expect, but also things we've talked about in the past: auditing capability in finance, payment optimization for payments, suppliers, kind of a cash management, machine learning application, and then HR candidate matching, so better candidate matching, candidate sorting for candidate ranking, not candidate selection because the potential with bias there, but using machine learning towards that as well. That's one area, again, across all three pillars.

The second area that you're going to see improvements in is what I'll call our traditional HCM UI. Using machine learning to improve defaulting of parameters, to improve general usability and predictiveness of how the UI works. Think of it as your phone. You do text messaging, and it uses machine learning to do autocorrect and suggest next words. That machine learning gets better and better over time.

Probably the final part, and this is where you're going to see most of the demonstrations, is we've added a number of bots that take advantage of our bot platform, machine learning, which are front-end agnostic.

The key here is not just the voice to text, the bot capability to process transactions, but it's the machine learning to allow you to have some intelligence with the transactions. In other words, when you're submitting the expense reports, you can take a picture and send it. Of course, there is character recognition, the machine learning on the character recognition but, also, it's things like policy enforcement or policy suggestions, so not just a bot that processes a transaction, but actually gives you suggestions either on the approval side, what you should approve or not approve, warning signs to say, "Hey, you're submitting this expense report, but it's out of policy." A little bit more using configuration and algorithms of the machine learning to do more than just process a transaction but, actually, give input to the end user.

In summary, it’s all about customer success, new traditional apps coming out, and then machine learning across the board and across channels via bots.

Let me pause there until I get into some commentary to see if that makes sense, but that's the 9 minutes and 42 seconds version of OpenWorld.

Steve, that's excellent. A couple of questions. You mentioned a few verticals. Is there another forum where utilities and telecoms, all the other industries that you guys have strength in, not necessarily in apps, is that going to be covered at Oracle OpenWorld, or is that a different event?

Steve: No, we have different sections within OpenWorld that focus on the GBU apps. Like you said, it's more of a broader look than just ERP apps because that wouldn't be enough to cover a vertical.

Steve, one final comment. You have so much in the apps area. You should think about an apps focused event. You have so much that is not known to the world.

Steve: Historically, we've had HCM World, Modern CX, the Supply Chain Summit here, and Modern Finance In 2019, we will be bringing finance, HR, and supply chain management together under one roof in Las Vegas at the Mandalay Bay on March 19-21 in a conference called Limitless, Presented by Oracle. At the same time and in the same place we will co-locate our Modern CX conference. We are making things very easy and very convenient for our applications customers and prospects.

Great. Send me that information closer to the time.

Steve: Hey, Vinnie. One more thing, if I may. You have been covering us for a long, long time, on this path to the cloud. I think what gets lost in the individual conferences and what we're extremely proud of is this has not been an overnight journey, but the maturity and the time cycle and the readiness of the solution is all now there, I just hope it doesn't get lost because of one conference. This is not an overnight thing.

As much as people get hung up on things Oracle did, said in the past, we've been at this for a long time. Hopefully, that credibility gets recognized because it certainly seems to be coming through with our customers and we're quite happy with it.

Steve, I'm extremely pleased to see you say application customers are going to be on stage. With Oracle, often the messages come through in different ways. I'm glad you're bringing varied customers on stage. It makes your point "Look. We're not Johnny Come Lately. We've been at this for a long time, and we have broad coverage."

You can watch here Steve’s keynote today at 9 am and Larry Ellison’s at 145 pm and his second one on Wednesday 2 pm, all times Pacific.

The 90s called–they want their ERP back

Eric Kimberling shared with me his post Top ERP Systems for 2019. His top 5 are Microsoft Dynamics 365, SAP S/4HANA, NetSuite, Workday and Salesforce (more its partners like FinancialForce).

The post made me wonder what my application analyst colleagues at Gartner in the 90s would say about the state of ERP today. These were studs like Erik Keller, Chris Jones, Art Mesher, Bruce Bond and others. You can credit us or blame us for a large percent of ERP decisions in the runup to Y2K. Without sounding too boastful, we helped tens of thousands of enterprises with their ERP selections, many of which are still running.

In turn, we were also demanding on vendors. Yes we argued architecture – thin v fat client, 2 v 3 tier deployments, but we also demanded functional depth. We challenged their claim of “best practices” and reengineering platforms.  We saw vendors were not doing enough on the shop floor, in logistics, customer facing areas and created new categories of markets like MES, SCM and CRM. We pointed out that ERP vendors had little in way of books of record for insurance, oil and gas, retail, utilities and many other sectors. As a result, vendors like SAP introduced their Industry Solutions, most after the Y2K deadline had passed.

We also pointed out that the payback from ERP was showing low because customers were implementing financials, hr and other back office modules but not operational or customer facing ones. Many were so guided by SIs, especially those with accounting heritages who had never set foot in a factory or warehouse or R&D lab.

Since then, there has been plenty of moronic talk about how manufacturing is dead and supply chains were optimized long ago. The US is still the second largest manufacturer in the world and the modern shop floor is dotted with wearables, 3D printers and robots. Supply chains are being redefined with modern distribution centers and last mile delivery options. Utilities are into net metering and predictive maintenance. Insurance companies are being challenged to rethink business models. Banking is being reshaped by a swarm of fintech vendors. Every process in every industry is being reimagined with automation – drones, AI, autonomous vehicles, kiosks, RPA. There is no industry whose books of records have not been reshaped. It’s time for ERP vendors to wake up from their Rip Van Winkle 20-year slumber and show they have customer citations with these modern capabilities.

Looking at Eric’s list I get deja vu. Most on his list are fine in the back office but not do not have robust capabilities (as yet) in operational areas. They certainly do not have industry functionality (most do around services and PSA, but not in other big chunks of the economy) . Those are the areas that need modernization. Instead we risk making the same mistakes we did in the 90s, helped by a younger generation of the same SIs.

Don’t get me wrong – I was trained as a CPA. I understand the need for robust financials and analytics

But let’s call them that – accounting and hcm in the cloud. Let’s not call them ERP. And like my colleagues did in the 90s let’s push vendors to deliver contemporary and deep functionality, not just talk “cloud” architectures.

And let’s challenge SIs when they talk digital transformation around these narrow footprints. That is today’s codeword for reengineering. The biggest bang comes from smart products, omni-channel commerce and related logistics, modern shop floors not just from modernizing the back office as we did the last time.

Inforum–peeling an onion

I wrote last week that I was looking forward to getting an update on Infor’s verticals – hospitality, healthcare, manufacturing, logistics, retail and others. At Inforum in Washington this week, I only got a detailed briefing about the Retail vertical.

So, in the couple of days I spent at Inforum this week I kept thinking this is just a financial and HR vendor which has contemporary technology. And at every corner, I would pick up a nuance.

Like Coleman, introduced last year as its digital assistant is now also an entry into RPA world. 

Its CRM group does not get the visibility of Salesforce or Microsoft or ServiceNow but in a breakout I learned about their CPQ, next-best offer and other capabilities.

The Retail group opened my eyes to how Infor is learning to cross-sell across its many, often confusing, units. Over 50% of its GT Nexus network revenues now come from retailers. They also leverage Predictix, its demand forecasting engine. Similarly many leverage its horizontal financials and hcm capabilities. Pilot Flying J presented to analysts how it is using Infor products to run its chain of truck stops.

Koch Industries (an investor and customer) shared their asset management story. Infor has long had some large, complex customers for its EAM like JPL and CERN. Add Koch portfolio credentials and you are talking some heavy iron.

Talking of HCM, while Infor does not get as much attention in the HCM space behind the Big 3 cloud players – Workday, SAP SuccessFactors and Oracle, it has a sizable presence in its Lawson and other customer bases. And its Talent Sciences group allows Infor to hold its own against all the data science and machine learning that is increasingly reshaping the world of Talent analytics

While they may not have much to show in terms of what I call “books of record” like retail merchandising and hospitality reservations, Infor does have plenty of industry level features.

Ashley Hart, the new CMO shared with analysts the running start she has made – moving advertising dollars from hub to private airports, sponsoring key tennis and golf stars, improving digital presence and measurement and new commercials. I think it is smart that Infor is targeting the executive buyer.

I think as big a challenge for her will be to help customers and prospects navigate the Infor maze. I tried to find the TV commercial launched this week to share with a colleague. I Googled for it, I searched YouTube, I looked at several places on the Infor site. I finally asked their chat group and they could not find it online either. They told me they would try and email me a link. (update - Sharon Sulc of Infor provided me the video below)

I bent the ears of several Infor execs this week about developing more industry capabilities. Honestly, before they add even more capabilities, I think they would do better to organize and share what they already have.

I look forward to peeling this onion some more.

 

 

Oracle’s streak of missed opportunities

No, this does not have much to do with Oracle’s recent quarter. Nor is it about intrigue and gossip so many analysts use to compare Oracle to the Trumpian White House. It has more to do with two decades of enterprise tech I have researched as I write SAP Nation 3.0. It is striking how many times I have seen opportunities Oracle could have taken advantage of.

As I wrote in Who will claim the Enterprise “Western Frontier” most enterprise vendors, not just Oracle, missed out on several trillion dollar markets that have emerged since 2000 and have made Google, Foxconn, GE, Amazon and others sizable technology players.

But even within its peer group, Oracle has missed out on several opportunities.  It took way too long to deliver Fusion. Even then, it could have stalled growth at Workday, Salesforce, Adobe and other cloud vendors. It could have delivered a knockout punch to SAP starting around 2010 with its early start with Fusion and its many cloud acquisitions. It could have taken several of its vertical industry capabilities to the cloud and gone after SAP in those markets. It did not and SAP with S/4 and its own cloud acquisitions has weathered the storm.

With its IaaS, Oracle could have navigated around Amazon, Microsoft Azure, Google and mopped up the hosting market around its EBS, PeopleSoft. J.D. Edwards and Siebel customer bases. Not particularly exciting, but a relatively captive 25,000 + customers is nothing to sneeze about.

While it finally has rolled out its SOAR cloud migration offering, Oracle could have done that years ago and would have been well on its way to migrating the 4 customer bases above to the cloud.

It has chosen to go after third party maintenance vendors like Rimini via the legal route, when it could have listened to its customers who wanted support for customizations and more responsive ticket support even more than cost savings. Oracle likes to emphasize the trust and security angles but that is only one criterion in a multi-dimensional decision. It also uses the security angle  in its IaaS  pitch, but often loses on capex scale and continuous improvement track record. Its autonomous database pitch has been diffused because it is only available on its IaaS (it says it needs that to be able to deliver to the high availability SLA) and not (yet) to its much bigger on-prem database market.

With more of a focus on customer value from its technology, I am convinced Oracle could easily be twice its size. Instead it has way too many customers who are wary about its commercial practices and only grudgingly bring it into new opportunities.

I could go on.

Actually looking at two decades of Oracle’s meandering I am tempted to write Oracle Nation. Maybe some day I will write that. For now SAP’s continuing turnaround makes for a much more compelling story.

Implementation Groundhog Day

I was recently introduced to Bonnie Tinder, founder of Raven Intel. Her startup is on a mission to “quantify the quality” of HCM implementation projects, especially the role of the SI partner. As her site says “We’re amplifying the voice of the past customer so the future customer can find the perfect partner.” It is a noble mission and she has a white paper out in time for HR Tech this week which summarizes findings from the initial 100 projects her team has analyzed using net promoter scoring and other techniques. 

In talking to her, though I felt like “déjà vu all over again”.  At the start of my career at PwC I remember a firm-wide event where the tagline was “Selling is only the beginning”. We had had a few major disasters and the leadership was trying to push a quality drive in the rank and file. In the mid 90s when I analyzed ERP integrators at Gartner I co-authored a report on SIs which started with a quote from a US District Court case “A Michelangelo should not charge Sistine Chapel rates......for painting a farmer's barn".  Our study like Bonnie’s focus had surveyed countless customers and we had also scored SIs on a number of ERP project dimensions. In 2000, a few of us set up a digital marketplace for customers to more objectively procure SI services for SAP, Peoplesoft, ecommerce and other projects. We had planning tools for customers, proposal engines for vendors and we had looked at the whole supply chain of such projects. Our timing was poor with the tech market meltdown and the startup failed a couple of years later. In the next few years, I was enamored with the CMM Level 5 and Six Sigma focus at Indian firms and took a number of CIOs on due diligence trips there and to E. Europe. By 2010 I slowed that down as I saw the rigor failing and the firms getting greedy. In 2014, I wrote SAP Nation because I saw an out-of-control SI and outsourcing ecosystem. Now as I write the next volume of SAP Nation I am seeing folks like Jarret Pazahanick talk about the “Wild West” of implementation consultants around the more contemporary crop of cloud solutions.

Like I said déjà vu all over again.

Some things never seem to change. Buyers don’t seem to have the muscle memory of the last major project failure. Vendors continue to treat SIs more as a sales channel than a delivery arm. So, you have Salesforce flagrantly bragging how many $ partners make for every $ of software, when customers want to see that tightly managed. As I wrote in “Fool me twice, shame on me” I worry that SAP did not learn from the last wave of massive project failures which hurt its brand, not that of SIs. SIs continue to brag about RPA and other automation, but show little movement to more machine, less human in their delivery. We have done hundreds of thousands of ERP, CRM type projects in the last few decades. It’s not rocket science. There should be predictability and there should be significant economies of repetition.

And yet in other ways things are changing. The upgrade and application management onus has moved from SI to the SaaS vendor. The hosting has moved to the IaaS vendor. We should expect Six Sigma and CMM 5 productivity from these vendors. The buy versus build pendulum is swinging as software vendors neglect vertical markets. That brings different expectations of SIs.

What has not changed is that customers are still expected to absorb all the risk. As Brad Keywell put so well in this profile I did of him “Most troubling, the customer is left taking all of the risk, outlaying all of the money, and then holding the bag if the implementation is a failure – the legacy risk-reward model is out of whack. Legacy software vendors ask for money but then avoid accountability for outcomes.”

In the last two decades most CIOs have expanded their stable of service providers – contract manufacturers, 3PLs, digital agencies, design thinking firms, service arms of industrial asset vendors. Many look at me and shake their heads when I tell them they still have to keep an eye on their HCM and CRM and ERP implementers.

Why are we still fighting that battle decades later, they ask? Welcome to Groundhog Day.

Nothing “permanent” about Oracle-Rimini

I cannot believe I am writing about another legal matter this week. I wrote earlier this week about litigation cases involving Oracle, SAP and Workday.

Judge Larry Hicks of the US District Court in the District of Nevada has had a distinguished career after his appointment there by President Bush in 2001. He has been on senior status since the end of 2012. The means he could have retired but continues to serve the public. You have to admire that.

I wonder though if he has enjoyed presiding over the Oracle-Rimini saga which has been going on since January 2010. It’s been like a tennis match with volleys back and forth. Indeed, a sentence in his latest judgment brings that out nicely (italics mine)

In its decision, the Ninth Circuit affirmed in-part, reversed in-part, vacated in-part, and remanded in-part the jury’s verdict and the court’s various orders in this action.

I had to smile when I saw the latest injunction is titled “permanent”.  I did find Oracle’s reaction a bit strong given that they have not been able to put this to bed yet.

Rimini Street’s business has been built entirely on unlawful conduct, and Rimini’s executives have repeatedly lied to cover up their company’s illegal acts. Rimini, which admits that it is the subject of an ongoing federal criminal investigation, has proven itself to be disreputable, and it seems very clear that it will not stop its unlawful conduct until a Court orders it to stop.

Rimini for its part, blandly said it will appeal.

I realize this is all legal jargon and jockeying and I am no lawyer.

But…..Oracle could have solved this years ago by offering a similar service. Most Rimini customers I talk to were not just attracted by the lower price (they had to balance the viability risk that came with a small vendor being sued). They did like the fact that Rimini supports their customizations. They love the fact that their ticket volumes have GONE UP. Yes, they got tired of raising tickets with Oracle (or SAP) because they tell me they rarely got resolved so they quit raising them. They like the dedicated rep model they get with Rimini. Oracle usually tells them the quality of their product is more secure, more trusted etc. It was a quality of service, as much as product and an economic decision for many customers.

Oracle has also sent mixed messages to its customer base. It keeps telling them to move to the cloud (indeed the litigation I wrote about earlier in week suggests it coerces them to do so). But if they want to stay with the legacy products, why resent them looking around for support?

Here’s what baffles me. The reality is most Rimini customers continue to buy new stuff from Oracle (and SAP). They continue as YOUR customers, Oracle. I like the fact that you are challenging the Pentagon not to sole source cloud infrastructure, but in turn should you not respect incumbent customers balancing their portfolio if they so choose?

I apologize for putting my usual customer advocate hat. Let’s go back to our regularly scheduled programming and enjoy the tennis match!