Wednesday’s Whispers: The Word On the Street

PEOPLE WHISPERS: MOVES, PROMOTIONS, AND MILESTONES

Congratulations to all! Thanks for your emails and alerts. If you’ve got a change or know of a promotion, keep dropping me a line!

Bruce Cameron is now President of CDC Software. The former executive vice president of worldwide sales and marketing was promoted from within. He now reports to Peter Yip, CEO of parent company CDC Corp.

Jocelyn Eisenberg has started her own analyst relations firm at Eisenberg Analyst Relations Services.

Garland Hall has been appointed SVP of Product Support at Deltek. Garland joins Deltek as of October 6th and brings experiences from EnterpriseDB, Composite Software, and webMethods. As a direct report to Kevin Parker, Garland will manage the global customer support operations.

Klaus Kreplin, the head of SAP’s NetWeaver Product and Technology Unit retired from SAP in October.

Allen Lovett joins Compiere as EVP of Field Operations. Allen will drive go-to-market stratgy for global expansion in sales and professional services. Lovett comes from senior experiences at Sawis Communications, Oracle, Siebel Systems, and Upshot.

John Papandrea joins SAP as a SVP of the Healthcare IBU from Deloitte.

Hannah Smalltree became Editorial Director, Enterprise Applications Media Group at TechTarget in July 2008.

Sergio Segal became a consultant in Competitive Intelligence at SuccessFactors in June 2008.

Borys Stokalski, VP at Infovide-Matrix has become President, Mazovian Chapter at PTI (Polish Information Processing Society) in October.

Michael Van der Breggen has been promoted from Operations Director to Vice President at Atos Origin. He will lead the company’s ERP services in North America as of October 29th.

Ben Wan became Board of Advisor at Motally in August 2008.

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CORPORATE WHISPERS

Got a scoop or something to share? Please post or send on to rwang0@gmail.com and we’ll keep your anonymity.

1. Heatlhcare Information Systems are still all the buzz. The VC’s I’m talking to hint that a big name like a McKesson, Cerner, Epic, or Medi-tech may make the move or be the target. One could even expect the acquirer to be a Big 4 vendor.
2. SaaS Integration vendors may be the next big area for M&A. As customers struggle for seamless hybrid integration, vendors are looking for the best integration tools.

Copyright © 2008 R Wang. All rights reserved.

Tuesday’s Tip: Packaged Apps Strategy - Building Blocks for a Recession Proof Apps Strategy

The tightening credit crisis continues to impact IT budgets and 2009 planning assumptions. Ongoing conversations with clients confirm that most enterprises anticipate some retrenchment of budgets. As business and IT teams seek to reduce the cost of existing systems, several key enterprise packaged app strategies rise in importance:

• Software contract reviews - leading clients invest time in reviewing existing contracts for new opportunities to reduce costs, anticipate business model flexibility, and contain overall vendor lock-in.
• Vendor rationalization without lock-in risk - now may be the right time to identify vendors core to the overall business strategy and build stronger long term partnerships. On the other hand, vendors who have tried to raise prices or failed to deliver as a technology partner should be weaned off approve vendor lists, especially if you risk vendor lock in.
• Shared services deployment - enterprises with multiple divisions and business units are looking at shared services to drive further efficiency by eliminating duplicate software, infrastructure, and staffing.
• Project portfolio analysis - clients are looking to “stop feeding the beast” and reduce the overall spend for legacy systems while freeing up the remaining budget for new innovation. Leading clients deploy application scoring and ranking methodologies.

The bottom line.

As you begin the planning of your recession proof packaged apps strategy, leverage a long term apps strategy frameworks to assess people management and organizational alignment, business process definition and optimization planning, technology strategy planning, and solution centric ecosystem maturity. Keep in context the 4 major business drivers from efficiency, regulatory compliance, growth, and strategy.

Your POV.

Got a strategy, lessons learned, or success story to share? Post here or send a private email to rwang0@gmail.com. If I use it, I’ll send you a copy of one of our Long Term Packaged Apps Strategy reports. Look forward to hearing your thoughts!

Copyright © 2008 R Wang. All rights reserved.

Monday’s Musings: Adoption of SaaS Models May Accelerate with Economic Downturn

All signs lead to an impending slow down in economic spending. Whether this will adversely impact IT budgets is not the issue, but how much will the carnage be is the concern being debated. Regardless, overall funding for new investments appears to be bleak which is why innovative business leaders seeking to fund innovation without significant capital outlays will most likely gravitate to alternative deployment options such as Software as a Service (SaaS) or other OnDemand models because of:

• Subscription billing - why worry about the cumbersome capital expenditure budgeting process when you can sneak this in with operational expenses?
• Rapid deployment - avoid the headaches of complicated deployments, the expense of system integration, and the cost of maintaining a data center.
• Affordable constant innovation - avoid the cost and disruption of upgrades while receiving more frequent delivery of new features and innovation.
• Purpose built functionality - most SaaS offerings are designed for a specific industry, role, or market segment. The result - strong capability in micro-verticals and other purpose built scenarios.

The hallmarks of SaaS are hard to ignore, especially during the advent of an economic slow down. Based on some of the growth rates in the previous quarter, vendors like Amitive, Concur, Intuit, NetSuite, Plexus, SalesForce.com, SuccessFactors, Taleo, and Zoho may have the leg up.

Your POV

Look forward to hearing your comments about how on-premise vendors will fare compared to the SaaS vendors. If you’ve got an idea or suggestion to share, please comment or send a private email to rwang0@gmail.com. Look forward to hearing your thoughts!

Copyright © 2008 R Wang. All rights reserved.

Apps Strategy: Now's the Time to Design a 5-Year Packaged App Strategy

What do ERP fatigue, instance consolidation, upgrades, SaaS, third party-maintenance, and BPO have in common? They are all stop-gap measures in addressing the key issue of having a long-term apps strategy.

Some key areas to consider include:

• Most packaged apps were bought in the mid to late 1990's
• Software lifecycle is about 7 to 10 years and we are entering a new upgrade replacement cycle
• Large demand for small projects skirt the real issue of a need for a packaged application strategy
• Architectural renewal via SOA and adoption of Web 2.0 functionality driving interest

As we move into one of the biggest upgrade cycles in a decade, enterprises should take the time to design a top-down view of their apps strategy before committing project budgets. A high-level view of the key components of this strategy include:

• Long term vendor strategy and management
• Packaged applications internal inventory
  
• Maintenance and support schedules
• Upgrade strategy
• Instance consolidation strategy
• Deployment option analysis (SaaS, Hosting, BPO, or On-premise)
  
• Change management readiness
• Business process maturity
• Custom development requirements
• Hardware/data center migration plan
  

(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2007 by R Wang. All rights reserved

IPO Watch: Deltek Files S-1

After much anticipation since New Mountain funds took the company private with a 75% stake in 2002, Herndon based Deltek Systems filed its S-1 on May 8th 2007. As a Project Based Solution (PBS) vendor, nothing could be more fitting than coming out with the NASDAQ symbol "PROJ". While private, Deltek remained active and acquired Wind 2 in 2005 and Welcom in 2006 leading to a doubling of its size and customer base. The results of this acquisition and maintenance strategy speak for themselves -- software license growth up 215.7%, maintenance increases of 89.1%, and overall revenues up 153.33% since 2002 (see Figure 1.) Key to Deltek's future will be the expansion into new vertical areas beyond its strengths in public sector, A/E/C, non-profit, and research. Deltek's key competitors include industry stalwart Primavera, .NET competitor Epicor, and Microsoft with its Project and Solomon offerings.

Figure 1. Deltek Consolidated Financials as Filed in S-1

		2002				2003				2004				2005				2006
		(in thousands, except per share data)
Statement of Operations Data:
REVENUES:
Software license fees		$	23,742			$	36,636			$	34,934			$	45,923			$	74,958
Consulting services			18,063				22,842				28,585				41,212				66,573
Maintenance and support services			43,987				47,778				54,178				63,709				83,172
Other revenues			4,512				2,091				3,516				2,112				3,565
Total revenues			90,304				109,347				121,213				152,956				228,268

As the Project Based Solutions (PBS) space heats up, expect rapid consolidation in the next 3 years among vendors such as Agresso, Artemis Software, Augeo Software, BST Global, CA (Computer Associates)Niku, Computer Methods International Corp. (CMiC), Deltek, Dexter & Cheney, Epicor Software, IFS, Lawson, Maconomy, Maxwell Systems, Mercury Software, Meridian Systems, Microsoft Dynamics, Oracle, OpenAir, Pacific Edge, Planisware, PlanView, Primavera Systems, ProSight, Sage Software, SAP, Softrax, Tenrox, and Viewpoint Software (formerly BidTek). According to Forrester Research, the PBS market is expected to grow to $6.5B by 2010.

(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2007 by R Wang. All rights reserved

Industry View: SaaS Applistructures Deliver on the Promise of Tying Web 2.0 to Enterprise 2.0

Walking out of the SalesForce.com Event on Tuesday the 10th had me thinking about the promise of Web 2.0 for the enterprise via middleware, SaaS platforms, and this notion of Applistructure. The thing that really struck home was not the utility computing model that Marc rants and raves about, nor the great drag and drop content management capability of Koral that was being demo'd. What struck home more than anything was how applistructure was taking shape via SaaS and how quickly SaaS could deliver Web2.0 capabilities to the Enterprise.

Okay, let me take a step back, what's applistructure? Well, applistructure refers to the boundary blurring between business applications and infrastructure software. Originally coined by Ken Vollmer of Forrester (Giga) in 2003, the term is shaping up, especially with the rise of middleware platforms (e.g. IBM WebSphere "Blue Stack", Oracle Fusion Middleware "Red Stack", Microsoft VS.Net "Rainbow Stack", and SAP NetWeaver "Blue and White Stack") that are doing everything from being the appserver, delivering BPEL, modeling business processes, addressing content management, providing business intelligence, coordinating master data, solving identity management, etc. SaaS itself is an applicstructure and as these applistructures take hold in the enterprise world via middleware, the SaaS vendors including SFDC, NetSuite, and WorkDay, have the best opportunity to deliver on most of the collaborative aspects of Web2.0.

Unfortunately for most enterprises, not much of the Web 2.0 impact we feel here in the Valley has made it into the mainstream middleware platforms. In fact recent announcements of Lotus Quickr, SAP's end-user widgets, Microsoft Office 2007, and Oracle Web Center show slow to moderate progress in this arena. Hot for Web2.0 for years has been tagging, mash-ups, social network, participation architectures, and the spirit of the individual and wisdom of the tribe. Though we're starting to see wiki's, blogging, and RSS become the new collaboration standards for enterprises its really been the SaaS movement that's driving Web2.0 adoption into the Enterprise.

Similar to the shift in attitude on utility computing and the simplification of licensing and pricing to cost/user/month, I think we can count on SaaS to be the game changer again. I eagerly await to see what other Web2.0 innovations like the Koral acquisition by SFDC will make its way to the likes of SAP, Oracle, Microsoft, and IBM in this emerging solutions centric software world order.

(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2007 by R Wang. All rights reserved

News Analysis: Workbrain brings key workforce management capabilities to Infor customers

Acquisition of Workbrain marks 20th for privately held Infor Global Solutions, GmbH
Infor's acquisition this morning of Workbrain for $227M marks its 20th. Assimilation of the Toronto based workforce management vendor fills a significant void in the # 3 ERP vendor's product portfolio. Workbrain delivers key work force planning, time and attendance tracking, scheduling, absence management and related solutions that help companies contain costs and develop optimized human capital management strategies. Marquee customers include British Airways, Target, and General Mills Inc. Infor and Workbrain have similar customer profiles that should lead to many joint sales opportunities.

By adding key workforce management functionality, Workbrain complements Infor's greater strategy of growing revenue among its 70,000 customer base via sales of extended solutions. Infor's business model primarily focuses on customer retention and maintenance revenue optimization. While Infor continues to maintain a strong track record in retaining acquired customers, future prospects should continue to validate the level of support and quality of enhancements delivered among current products with existing customers. On the next gen architecture front, Infor's future SOA strategy remains visionary in its approach. When delivered, one would expect it to lower overall TCO by design and extend flexibility to existing customers seeking the flexibility and integration requirements of SOA.


(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2007 by R Wang. All rights reserved

Event Report: CDI-MDM Summit, SF, CA

I recently moderated a track with a colleague of mine (Rob Karel) at the CDI-MDM conference this March 26h and 27th at the San Francisco Marriott. Though master data management penetration in the enterprise still hovers in the high single digits, its obvious the energy, activity, and investment around MDM continues to grow. Some quick observations at the event:

• Hierarchy management and data governance remained the most sought after topics
• Vendors seemed to outnumber clients (We found this later not to be the case)
  
• Clients who were there remained at the technical level
• Projects were beginning to require a higher level of executive sponsorship
• Effective change management was beginning to become a critical success factor in all sizes of projects
• Customer projects (given the bias of the event) dominated discussions though other entity types such as products and location became ancillary requirements.
  

In general, this event was a great chance to catch up with others pursuing the development of MDM tools and solutions. And as always it was great to see my familiar faces from Siperian, Initiate, DataFlux, Purisma, IBM, Oracle, VisionWare and, i2 at the event.

(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2007 by R Wang. All rights reserved

News Analysis: SAP in a Post-Shai era?

It's hard to believe that less than 7 years ago, SAP was seen as a stodgy, client-server based, and very stubborn German software company. That transformation from "borg-like" vendor to innovator wasn't easy, but at the helm of that transition was Shai Agassi. As one of the few non-German executive members, he harnessed the can-do attitude of Silicon Valley, brought the Israeli practicality, and tied the engineering talent of SAP closer to the pulse of innovation. And despite the skeptics, he shifted power away from Germany and Newtown Square to Palo Alto.

Looking back, Shai leaves an organization with quite a legacy. First and foremost the transformation from client-server to internet. Shai also drove the efforts to get mySAP CRM out the door and build out the mid-market. But even more importantly, the strong software ecosystem and partner network that Shai so evangelized leaves SAP with the foundation to innovate and build last mile solutions so needed in the micro-vertical market. SAP's success in building buzz and attracting ISV partners includes work with Microsoft on Duet that continues to differentiate SAP from its chief competitor, Oracle, in the applications space. Finally, the vision and swagger Shai brought to SAP will be the most memorable. Customers often left impressed by the possibilities they could see in their investment in SAP.

Yet, challenges abound for SAP in a post-Shai world with or without him. Microsoft shows continued success in the SMB side of the house with wins in hub and spoke SAP environments and subsidiaries of SAP enterprises looking to wean themselves from the high cost of ownership and upgrade to mySAP ERP 2005 Meanwhile heavy discounting by Oracle in the large enterprise space, put quite a squeeze on SAP in the near term for new business in the large enterprise space, as only Oracle can afford to bolster app sales with middleware and database revenues. SaaS entrants like SalesForce.com and NetSuite chip away at SAP's cost structure and usability while the entrance of Dave Duffield's WorkDay may complicate SAP's efforts to beat Oracle/PeopleSoft at HCM. As user experience becomes important, SAP has fallen behind in building products that showcase the best of Web 2.0 meets Enterprise 2.0.

So while Shai brought vision and innovation, much work needs to be done in a post-Shai world. The need to execute becomes greater as promises made to customers, partners, and employees must be kept. Investment for better tools in NetWeaver and MDM would help partners build more efficiently and allow for a stronger ecosystem foundation. Success in the mid-market and a strong SaaS offering would put competitors SalesForce.com, WorkDay, Oracle, and NetSuite on the defensive. Moreover, a move away from middleware infrastructure in general would expedite the transition from Oracle database to anything else and keep SAP from indirectly funding future Oracle acquisitions and Oracle's development of competitive products.

But without a visionary like Shai at hand, the top tier talent he brought into the valley will need a reason from management to remain. Execution of Shai's vision has always been the most challenging role to play and we will know in the next 3 to 5 years how SAP will fare in the market. Yet despite execution being the key to near term success, SAP will still need an articulate visionary at the helm or risk retreating on the visibility and panache Shai brought to the industry.


For additional information:
Official SAP Press Release
San Francisco Chronicle
SearchSAP.com
Managing Automation


(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2007 by R Wang. All rights reserved

News Analysis: Tammi Reller's transition to Interim Head of MBS

The recent transition of Satya Nadella to the new Search and Ad Platform group came as quite the surprise to many outside of the Redmond community. Satya had recently taken over in September 2006 from long time Great Plains icon Doug Burgum. (Doug is retiring later this year.) Insiders say that Satya was chosen for Search and Ad mainly because of his ability to turnaround teams and deliver on results.

The transition to Tammi Reller makes sense, as Tammi has had many roles within Dynamics, most recently as Corporate Vice President of MBS marketing. Customers should expect little disruption in strategy as Tammi's an insider and has worked closely with Satya and Doug for quite some time. It's expected that Tammi's role as interim head of MBS should become permanent and many remain excited as she brings some marketing buzz and excitement to the teams.

After attending Microsoft's Convergence User conference in March, it's apparent that Microsoft continues to lead in the user experience department with the most resources and innovation dedicated to role based scenarios and user experience optimization. In addition, the Project Green strategy appears to be transforming from a converged product roadmap with a target date, to one where the 4 products have target dates for consumption of key middleware components such as SQL Server, SharePoint, BizTalk, SmartClient, etc. Maybe that was the original plan, but now it's becoming clear that this will be the approach for some time to come.

(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2007 by R Wang. All rights reserved

Event Report: Lawson CUE

After a horrendous time getting out of the Mumbai Airport where I missed my flight and had to fly to NY in order to get to California... I finally made my way to sunny San Diego for Lawson's CUE event on March 4th to March 7th. Though I missed the Sunday festivities, the week there was well worth it as Lawson continued to show progress in developing its product line, winning customers, and building tighter partnerships.

Some quick observations from the event:

• The general mood was upbeat among both clients and partners
  
• Lawson furthered their relationship on IBM's "Blue Stack" including the WebSphere ESB with current releases:
  
• For S3 customers, WAS, Tivoli Directory Server, and DB2 are also offered in Lawson S3 System Foundation 9
• For M3 customers, the new Lawson M3 System Foundation includes WAS as well as LSF runtime technology
• On the hosting front, Lawson Total Care Platinum tied the highest level maintenance and support program with full hosting and application management services with IBM as well as other partners.
• From a social, corporate responsibility angle, Lawson announced a Corporate Social Responsibility Initiative that packages pre-configured Lawson applications and Lawson Business Intelligence (LBI) to report against over 100 indicators that could support at company's corporate social responsibility initiatives.
• Recent high profile wins at a major global retailer bode well for Lawson's future global roll-out and functionality capabilities.

Overall, clients and partners once again found value in the event. And of course, EVP Dean Hager's presentations were as energetic, informative and entertaining.


(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2007 by R Wang. All rights reserved

Ecosystems: Systems integrators should transform to solutions providers

As I reflect on my current trip to India, I can't but help feel the deja vu of the Silicon Valley during the late 90's. Streams of business people come in and out of the lobby with ideas, deals, and lots of excitement. I'm typing away from the Hotel Leela in Bangalore where I just met with a client in the system integrator space. Like others, she also commented on the tremendous growth in just the past year. Among the construction cranes, cows in the street, motorized rickshaws, and the hustle and bustle of a country on the move, I have firmly experienced an outsider's perspective on India's growth.

With each trip, I notice new architectures and campuses being built or expanded for each of the SI's. India's info tech economy continues to grow and their system integrators now play a significant role in the global professional services business. As they continue to make progress and gain multi-billion in revenues, they remain on an aggressive move towards the next step in the value chain.

With that perspective in mind, opportunities exist for these highly skilled system integrators to make the transition from system integrator to solution provider. More importantly, those system integrators who have the development capabilties and understanding of various middleware platforms such as BEA WebLogic/AquaLogic, IBM WebSphere, Microsoft.Net, Oracle Fusion Middleware, and SAP NetWeaver have an opportunity to change the software environment in their next transformation. Just like Electronic Arts who builds software on Sony's Playstation, Microsoft's X-box, and Nintendo's Game Cube, imagine a world where an Infosys, Wipro, Satyam, Cognizant, and HCL deliver their own Chinese HR talent acquisition solutions or eastern european process manufacturing solution on top of NetWeaver, Fusion, WebSphere, VS.NEt, or WebLogic.

Delivering last mile solutions regardless of middleware platform potentially transforms system integrators who are channels for the big vendors like SAP and Oracle into solutions providers who view SAP and Oracle as a strategic supplier. But to get there, these SI's will require internal transformation in their capabilities. Customers must view these firms as trusted advisors across the enterprise.

However, skills shortages still abound in advanced capabilities such as change management, master data management, business process reengineering, and overall IT strategy. But with some retooling, expect the most nimble and adaptive of these system integrators to make the transformation. Clients desperately seek resources to deliver process innovation while optimizing commoditized processes via BPO. The key success factor will be the capability to deliver modular last mile solutions by industry and geographies on top of agnostic middleware platforms or SaaS deployment options.

Once that transformation has been attained, IBM and Accenture will nervously have to look in their rear view mirrors as the competition charges forward. But for now, their positions remain safe.

(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2007 by R Wang. All rights reserved

Analyst 101: Debut of Beyond Order to Cash

Business pressures to grow market share, improve margins, reduce time to market, and retain customers with existing enterprise application investments compel enterprises to re-examine their existing order management cycle (OMC) strategies. With multiple categories of vendors offering order management solutions, business complexity across supply and demand chains should be the strategic driver in determining the appropriate solution fit. Companies looking to implement OMC strategies immediately will not find a single vendor solution.


Check out my first Forrester research report
Beyond Order to Cash


(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2005 by R Wang. All rights reserved