Wednesday, March 30, 2011

NetSuite has arrived on the scene of ERP in Manufacturing

When I first “met” NetSuite about 5 years ago I have to admit I didn’t really consider it an ERP vendor. Of course that was back when I had a more narrow view of ERP and thought that if a vendor didn’t have MRP then it didn’t have ERP. I’ve since gotten over that and for several years now I have defined ERP as an integrated suite of modules that provide the transactional system of record for a business. Not every type of business needs MRP to form that basis. Of course most ERP solutions offer much more than that, so this is really my base line definition.
Back in 2006 I viewed CRM and eCommerce as NetSuite’s strengths even though it did provide a suite that extended beyond these modules.  But since then it has officially entered the realm of ERP in my book. Its Home page on its website ( labels it as “The #1 Cloud ERP / Financials Software Suite” and further describes its solution as “full-featured financials / accounting, CRM, inventory, and ecommerce software—all in a single system.” So in a way, it is still down-playing the ERP moniker in favour of “suite” and its historically strong suit: CRM and eCommerce, packaged with financials.
Also back in 2006, NetSuite did not target manufacturers. Without a true Bill of Material and MRP all it could address was some level of assembly or very light manufacturing. That has now changed, although not all as a result of organic development. Some of the manufacturing functionality NetSuite offers now comes from a partner, Rootstock. Rootstock Software is a certified NetSuite Solution Provider specializing in the manufacturing industry with heavy focus on the NetSuite Manufacturing Edition solution. While its website claims, “NetSuite Manufacturing Edition is the only cloud-based integrated business suite for manufacturing”, I think they are missing a few other players, with Plex Systems being at the top of that list. Plex has been offering a complete SaaS ERP solution for manufacturing for more than 10 years. Other more traditional ERP players (Epicor, Infor, QAD, SAP) also have cloud based offerings for manufacturers and even more have arrived on the scene with hosted cloud models.
But what I find very interesting is that some of NetSuite’s key customer successes were achieved without the use of Rootstock functionality.  I just listened in to a webcast sponsored by NetSuite and featuring 2 manufacturers using NetSuite and both purchases pre-date the partnership with Rootstock.
Schaeffer Oil prides itself on being “the oldest oil company you never heard of.” With 30,000 customers, it processes 90,000 orders a year using NetSuite and has achieved the following results:
·         Reduced its IT spend by $100,000 in the first 6 months
·         Reduced cycle time of order processing from 3 days to 1.5
·         Reduced backorders by 25%
·         Processed 25% more orders with 15% less staff
·         Improved communication and visibility
GLI Pool Products is a manufacturer and distributor of custom and specialty products for the swimming pool industry. It was founded in 2006 with the purchase of assets from a much larger Canadian company and in doing so inherited an ERP solution, but none of the influence over its continued development.  Ultimately they replaced that inherited solution with NetSuite. GLI has bucked the downward trend in construction related businesses and attribute much of their success to the use of NetSuite. They achieved lower material and operational costs while improving flexibility – a key consideration as they no longer wanted to live in “used-ta-land.” They could no longer be productive and profitable doing things the way they used to do things.
So while the addition of Rootstock functionality really just took effect in mid-2010, NetSuite has been quietly amassing quite a collection of manufacturers in its installed base for quite some time. This is particularly notable since NetSuite is not known for its “quiet” marketing tactics. With the addition of a couple of relatively new names to the NetSuite roster (Roman Bukary and Ranga Bodla) charged with promoting NetSuite in Manufacturing and Distribution, perhaps this will change.

Thursday, March 24, 2011

Epicor University: Do we really need education and training?

Last week (March 15, 2011) Epicor announced the launch of a new university for its customers, partners and employees. Epicor University was created to address the challenge of delivering consistent high-quality training worldwide, and to expand the range of Epicor’s education deliverables. It also offers certification programs for Epicor’s partner channel. With the introduction of the university concept, all content, materials, and training is developed by a dedicated centralized team.
The primary objective is to provide customers with resources and tools to help them realize the greatest benefit from their enterprise software investment while allowing individuals to learn in the way they learn best. Epicor already offers a lot of resources, from embedded courses within their ERP system, to user guides, classroom courses and certifications, to an online help system that gets down to individual fields help and technical reference guides. According to Epicor, there are more than one hundred embedded courses associated with Epicor 9 and over 100 virtual or classroom courses available, 2,500 pages of content and graphics in Epicor technical guides, and 74,000 fields defined in Epicor 9 Field Help.
So why is a University needed? After all, user interfaces have become so much more intuitive and software has become easier to use. Navigation through an enterprise application is no longer cumbersome and confusing. And when was the last time you read the instructions for any kind of software anyway? If you can’t figure it out easily it just doesn’t get used.  
Exactly! That’s one of the reasons that education and training often gets ignored. Sure the user interface is intuitive. Sure it is easy to navigate through the various functions. But these are potentially complex business processes that are being modeled through an ERP. Are those business processes efficient? Are they standardized and repeatable? Do they produce a clean audit trail? Can they be easily audited? Do they put you in a position of competitive strength or hold you back from realizing your full potential? Most importantly, are you getting the most value out of your investment? Why do you think one company fails miserably while another succeeds beyond all expectations while they both use the same software?
Most every software company on the planet is working to enable self-service training and support. That makes sense. Like any other type of company today, most are attempting to grow while also reducing or constraining costs. The software business itself is very scalable. Create one piece of software and sell it dozens or hundreds or thousands or hundreds of thousands of times. But services don’t necessarily scale as easily. Sure, you can make it more scalable by creating user guides and online on demand training courses. But there is a certain element of education and consulting that happens one person, one hour or day at a time. And even the very best software can be underutilized, used incorrectly or used to model inefficient and incomplete processes.
So kudos to Epicor for bringing education and training back into the spotlight. Are you getting the maximum value possible from your ERP?

Tuesday, March 22, 2011

Have you heard of the "he-recovery?"

While I mostly keep up with news online, once in a while I like to be nostalgic and watch world news on TV. Last night I managed to catch the news on ABC and learned a new term – the “he-recovery.” As Diane Sawyer said, “The race is on for jobs” and men are definitely winning over women. While during the recession men lost twice as many jobs as women, now the tables are turned. According to ABC, of the 1.3 million jobs gained in the recovery, 1.1 million (that’s 90%) have gone to men and 113,000 (10%) to women.
Why is that?
Some of it has to do with the kind of jobs that have been created through stimulus efforts… think construction and transportation in which women only make up a small percentage of the workforce (13% women in construction and 5% in transportation – also according to ABC). But even in retail, which has traditionally been dominated by female workers, men have gained 100,000 jobs while women have lost 100,000. Others that were interviewed in the segment last night also hypothesized that men were given more jobs because they needed them more as the traditional breadwinner of the family. Yet women are the chief breadwinners of 40% of households in the US. Hmmmm.
I’ve officially been in the workforce for 36 years, and I had summer and part time jobs (sometimes more than one) while I was in school for 7 years before that.  During that time I would venture to say that I’ve seen it all.  I’ve been associated with some male-dominated environments, and others that are not so much. My first job out of college was working for a manufacturing company. There were plenty of women, but one other woman and I were the only two that were salaried and managers. Later I worked for a software company started by a woman who was then the president and CEO. I had plenty of women peers but I carried the title of Manufacturing Consultant (or a Manager of that same position) and I looked about 18 years old (I was in my 30’s). I knew when I went into a company for the first time I had about 37 seconds to prove my credibility or they would write me off. Nobody wrote me off.
I went to college in the early 70’s, during the height of the feminist movement, but I have never been much of a feminist. I always just concentrated on getting the job done and expected to be paid fairly for it.  But I have also worked for companies where I experienced a glass ceiling in spite of the fact that I am damn good at what I do. This tended to be where the “old boys’ network” was firmly in place, but I have experienced a “young boys’ network” as well. Same result, but it hurt more.
The bottom line is there is still a gender gap. A different ABC news segment also reported that the amount women earn (as compared to men) had increased by two cents over the past year. That’s the good news. The bad news is that means women (in aggregate) still earn $.81 for every $1 earned by men in similar positions in spite of the fact that women are now as well-educated as men. There is always speculation about why that is. Men tend not to interrupt careers for babies, but then fewer and fewer women today do any more. Some point to personality differences, but let’s face it, women are not all alike just as men are not all alike.
I do however think that women in general need to be assertive, not aggressive and younger women need more female role models and mentors. I’ve done my part through the years in working for corporations mentoring both men and women. As I start my own company, I start down a new and different path – one that by definition has no ceiling at all, glass or otherwise. Any women out there in need of coaching and support, give me a shout ( .
For those that would like to listen to the ABC news segment….

Summary from SAP Insider Keynote (SCM, MFG, PLM, Procurement)

Competing in the “Networked Normal” : A Pathway to Growth through Innovation and Collaboration
SAP EVP Richard Campione began his keynote this morning at the SAP Insider Event today with an interesting statistic: 85% of executives expect complexity to grow significantly. Interesting, but hardly surprising given the setting. This event co-locates several conferences: Logistics and Supply Chain Management 2011, Manufacturing 2011, PLM 2011 and Procurement and Materials Management 2011. Professionals in attendance are all focused on getting product to market and to customers. Given the global nature of business today, the speed of change and the proliferation of data and data sources, increased complexity is the natural result. And yet even with this growing complexity, customers’ expectation of speed and responsiveness is not diminished. In fact, it is only intensified.
Mr Campione also opened with a bit of history. Two years ago at this event there was talk of a recession and even a depression. Strategies were all about cash preservation and survival. A year ago, there was a fair amount of optimism and talk of recovery. Sentiment was … companies could once more invest, but the overriding theme was to invest in order to save. This year, 2011 is a “new beginning” and suggested that a good place to start was in looking at the problem as one of managing from “idea to delivery.” Again, nothing new or surprising, but the holistic approach to supporting this (complete) process was impressive.
Mr Campione also characterized 2011 as a year of crisis and hope. Crisis certainly needed no explanation given the recent uprisings and events in the Middle East, combined with the earthquake and tsunami in Japan. Given the disaster in the Pacific, it seemed quite apropos to show his audience the Chinese symbol for crisis, which is actually represented by combining the symbol for danger with that of opportunity. He encouraged his audience to seize the opportunity to learn from leaders. These leaders operate better within business networks. They innovate faster, capturing 25% of revenues from new products, compared to others who only generate 5%. They reduce inventory, citing instances of as much as 55% reduction in days’ supply. And they manage risk. What better backdrop for the need for proactive risk management than the efforts to avert a pending nuclear crisis?
All this is very relevant to the global environment, but how do we really relate this to how SAP products can help businesses “run better?” To summarize, it is all about operating better, collaborating better and deciding better. Given the proliferation of data bombarding us from all angles, it is about turning fast into real real-time. In SAP parlance, this means more (mobile) devices, more applications and more analytics.
More devices equate to more mobile devices, and this was the primary reason SAP bought Sybase – for its mobility platform. There are a lot of different applications along the path from idea to delivery and Mr Campione emphasized the need for these to be "consumable, ready to deploy, packaged applications." "Consumable" is a word I have been emphasizing to ERP vendors for the past several years, so this was music to my ears.
SAP brought an entertaining duo on stage to demonstrate a scenario that took us from
·         consensus planning, to…
·         the identification of “killer features,” to…
·         engaging the right people, to…
·         readying the supply chain, to…
·         analysing the process and the results
This demo scenario started with SAP Event Insight, then turned to Stream Work, followed by SAP Sales On Demand and finally the BI element of Business Analytics. Implied behind the scenes were PLM, ERP and manufacturing execution including sourcing and procurement. It touched on ideation, sales and operations planning and on the innovation SAP had delivered within the last 12 months, including the following:
·         Mobility
·         Stream Work
·         Business ByDesign
·         BI 4.0
·         Innovations 2010
·         HANA (in memory)
·         Netweaver 7.3
If you missed this keynote and yet feel the urgency to address many of these challenges, including the need to eliminate dual entry in multiple systems, the need for improved visibility, better integrated quality management, and lower inventory and operating costs, take the time to get a demo. If you are running solutions that are not using the latest and greatest technology, you may be pleasantly surprised. And remember how fast that technology is changing!

Wednesday, March 16, 2011

Infor announces hiring plans along with Q3 software license growth of 17%

This morning  Infor announced it will expand its engineering organization by hiring approximately 400 additional software developers and plans to add significantly more new features and releases this year than ever before.  Reinforcing, the strategy shift away from building middleware, all these new hires will be focused on building business applications.
This signals an increase in investment in product development under the leadership of the new management team put in place by Charles Phillips who took over as CEO, bumping Jim Schaper to chairman of the board.  Infor also announced license growth of 17% and increased cash operating margins of 24% (which includes Infor and Softbrands Q3FY11 results over Q3 of Fiscal Year 2010). Infor added 400 net new customers last quarter. This is an important statistic since we have witnessed slowed growth of ERP solution providers, coupled with the downturn in the economy over the last two plus years. Indeed, Infor’s customer count has hovered around 70,000 for the past five years, ever since the acquisition of SSA Global, Systems Union and Extensity in August 2006. Since then, new customer growth has compensated for attrition, but has not moved the needle significantly.
New releases, standards based integration through Infor’s new ION platform, and planned changes to a new and universal user interface are all necessary components in order for Infor to break out this year and grow that number, especially if it wants to grow organically, as well as through acquisition. This announcement comes just days after the new of the proposed bid to acquire Lawson by Infor and its major investor Golden Gate Capital. Clearly Infor management wants to send the message that while acquisitions are likely in the near future, organic growth is also important.  

Tuesday, March 15, 2011

Epicor Manufacturing Express Edition Up Close and Personal

I sat in on a webcast hosted by Epicor today on Epicor Manufacturing Express Edition, complete with a demo of the product. Epicor had pre-briefed me on its Express Edition back in August 2009 and then again when it was released in May 2010. For those of you not familiar with this Express Edition, here’s a very quick summary….
Epicor Manufacturing Express Edition is a simplified version of Epicor 9, developed specifically for job shops and discrete manufacturers and delivered only using a SaaS model. But Epicor is quick to point out that SaaS is a delivery model, not a product. The product itself is Epicor 9, simplified. By “simplified” I mean that Epicor has hidden selected bits of functionality in order to remove some of the complexity inherent in a comprehensive enterprise-level ERP solution… hidden and not actually removed. Built-in best practices are also layered on top of the software and templates and even a chart of accounts can be delivered right out of the box. The target go-live date is 20-30 days after installation.
Epicor Express includes CRM, product management, production management, materials management, financial management and built in business intelligence. Data migration tools can be included in the Express Start package or not, including the ability to import data from QuickBooks. Customers also have the option of using Sage Peachtree for accounting and financials and Epicor Express for CRM and production management.
Because Epicor Express is derived from Epicor 9, as companies grow (needing more features and functions), there is a good chance the features are already included in Epicor 9. In some cases those hidden features can be turned back on, allowing the customer to remain in a SaaS environment. But generally speaking, if you outgrow the Express Edition, you will likely be moving to another edition of Epicor 9 (Standard Edition or Enterprise Edition) and an on-premise environment or a hosted environment. But this hosted environment can include managed services, allowing customers to continue to avoid investing in their own IT infrastructure and staff. It is an evolutionary (and not revolutionary) path.
While I was quite familiar with the strategy and Epicor’s roll-out, until today I had not seen a "public" demo of the product. There were a few thoughts that struck me as I watched.
1.       The person doing the demo was a “Territory Manager,” which I interpreted it to be a sales function. This tells me two things: the Epicor sales folks know a thing or two about the needs of their prospects and clients (the demo was real and credible and did not appear to be “canned”) and you don’t need to be a product specialist to use the system. No offense to sales, but they typically have much more of a business development orientation than a deep product orientation.
2.       The system is relatively easy to navigate, which lessens the need for training. There is just one potential downside to that. As solutions become easier to navigate, customers make the mistake of thinking they don’t need any training. My experience tells me that users of ERP solutions still need to be trained procedurally, as much from a business perspective as a system perspective. Without some level of training, business processes get mucked up and users never take full advantage of the solution.
3.       And finally, I thought, “My, how far things have come since my days of doing demos.”  In the mid-to-late 1980’s my best demos were the ones where my hands never touched the keyboard. Of course most of those demos were done in the ERP vendors’ offices or via a dial-up modem. But in those days, you really needed to memorize all the various codes (since there were few, if any lookups); you spent as much time navigating the hierarchical menu structure as you did demonstrating “real” work. You spent far more time putting data into the system than you did showing how to retrieve it. Because getting data out was pretty hard, and usually ugly. This demonstration featured a series of what Epicor called “minute of your day type features” and I would venture to say in the old days, those “minutes” would have been hours.
Part of Epicor’s “pitch” is the level of experience it brings to small manufacturers. Founded in 1984, Epicor’s been around since back when I was doing demos. Today they are a public company with about $440 million in annual revenue, 2700 employees and more than 20,000 customers. In defining the simplified version of Epicor 9 that forms the basis of Epicor Manufacturing Express Edition, of course the company will draw on the experience it has gained in dealing with small manufacturers, perhaps many of them still running older Epicor products such as Vista, which over time has merged with Vantage and then morphed into Epicor 9. The only question I have is, how many of those Vista customers are still operating back in the world I knew when I was doing demos? What will it take to get them to venture into the 21st century? Perhaps Epicor Manufacturing Express Edition will lead them out of the darkness.

Infor and Golden Gate make a bid for Lawson

Over the weekend (or on Monday if you really “turn off” over the weekend), we all saw the news that Infor and Golden Gate Capital had made a $1.84b bid for Lawson. I watched all the Tweeting and chatter yesterday with interest. Prior to venturing into the analyst/research community about five years ago, I spent over 30 years in the enterprise applications world, the last 22 of which I never officially changed jobs. But during those 22 years, the company name on my business card changed five times. Also during those 22 years, I “experienced” first-hand 14 different acquisitions, sometimes being the acquirer, sometimes being the acquiree. Sometimes I was intimately involved and sometimes I was a casual observer on the periphery.  So I consider myself quite experienced, if not an expert, on mergers and acquisitions of software companies.  While all this chatter is interesting, one thing I can say with certainty is this: at this point it all boils down to speculation and gossip.
I know both of these ERP companies very well, both from the context of their products, as well as their history of software acquisitions. Within my first few months of joining Aberdeen back in March 2006, I wrote about acquisitions by Infor and Lawson that were quite momentous. About that time, three companies were approximately the same size in terms of revenue: Infor, SSA Global and Lawson. Shortly thereafter, in part in a bid to outdistance Infor and SSA, Lawson acquired Intentia in May 2006, only to be one-upped by Infor , which not only acquired SSA Global but also Systems Union and Extensity in August.
Lawson and Infor are both similar and different. They are similar in that both are primarily ERP solution providers that have grown by acquisition, and have stretched the boundaries of traditional ERP with complementary solutions such as Human Capital Management, Asset Management, Performance Management and Business Intelligence, etc. Also, neither has grown very significantly since those major acquisitions back in 2006.
However, there are some glaring differences. Lawson essentially has two major (largely non-overlapping) product lines:
·         S3 (which stands for Staff, Source and Serve) targets healthcare, retail, government, education, financial services, general service
·         M3 (which stands for Make, Move and Maintain) targets fashion, food and beverage, wholesale distribution, asset intensive industries and general manufacturing
Infor has many different ERP solutions as well as stand-alone complementary solutions. Here’s the latest list I have of just its ERP solutions alone:
  • Infor ERP Adage
  • Infor ERP SX.enterprise
  • Infor ERP SyteLine
  • Infor ERP VISUAL
  • Infor ERP COM
  • Infor ERP FACTS
  • Infor ERP LN 6.1
  • Infor ERP LX
  • Infor ERP Baan5.x
  • Infor ERP BaanIV
  • Infor ERP BPCS
  • Infor ERP Xpert
  • Infor ERP Blending
  • Infor ERP XA
  • Infor ERP TRANS4M
  • Infor ERP AS
  • Infor ERP System 21
  • Infor ERP VISUAL Jobshop
  • Infor ERP A+
  • Infor ERP TakeStock
  • Infor ERP Enspire
  • Infor ERP commerce@work
  • Infor ERP CAS
  • Infor ERP Infinium MM/PM
  • Infor ERP MK
  • Infor ERP MANMAN
  • Infor ERP MAX + TM
  • Infor ERP MAXCIM
  • Infor ERP PRISM
  • Infor ERP Protean
  • Infor ERP KBM
  • Infor ERP Leanware
  • Infor ERP PRMS
Some of these are strategic to Infor’s growth, while others must be viewed as legacy or “heritage” products (a “heritage” product is a legacy application you are proud of.) Although Infor has decried a rationalization strategy and maintained all acquired products, not all get equal share of the marketing or development budgets. Unlike Lawson’s two product lines, which have little overlap, many of Infor’s product lines do indeed overlap with each other and this has presented a challenge to Infor in the past, both in product maintenance and development, as well as market presence. If this acquisition does go through, M3 will compete with several of Infor’s existing ERP solutions. There is less similarity with S3, but it will compete with the Masterpiece and Infinium product lines, but will position Infor better in competing in the Human Capital space and also in Healthcare.
But, as I mentioned earlier, this is all just speculation. Will Infor raise its bid? Will others start to bid? If so, who? There are only questions right now, no answers. But some of the questions that must indeed be answered before this is all played out are similar to the questions that must be asked in most any acquisition. Questions like:
·         If there is a merger between Lawson and Infor (or any other competing vendor) will Lawson remain relatively autonomous or will it be entirely integrated? This will impact both its brand as well as the possible reduction in force that generally follows any acquisition.
·         What will be the impact on product roadmaps of all the products owned by the combined companies, regardless of whether additional bids emerge and who wins?
·         Will technology infrastructures be merged, or kept a separate? Consider for example very different cloud strategies, Lawson on the Elastic Compute Cloud (EC2) platform (Amazon and other partners provide the infrastructure; Lawson provides the application.)  The two key components of Infor’s cloud strategy and its infrastructure: Microsoft's Windows Azure and Infor ION.
One thing that should be a “given” is the continued support to Lawson’s existing customer base. In any acquisition of this magnitude, growth (and not attrition of) the installed base is always a goal. Existing customers should rest assured this will be a primary goal of Infor, or any other player that joins the fray. Exactly what that means remains to be seen.

Thursday, March 10, 2011

SAP GRC 10.0 delivers value. The voice of the SAP customer has never been stronger

I’ve just spent a full day at the SAP Insider GRC 2011 event, where over 700 GRC professionals from all over the world gathered to network, share experiences and hear about new developments from SAP.  This is an annual event, co-located with SAP Insider Financials 2011 and HR 2011, the 9th of its kind, and my 4th. As a conference within a conference, the message from SAP had a dual focus for GRC 2011, but with a common theme – delivering more value to its customers by listening carefully to their needs. Previews of the upcoming release of GRC 10.0 (currently in ramp-up with general availability planned for Q2) were a testament to the fact that the voice of the SAP customer has never been stronger.
Sanjay Poonan, SAP’s President of Global Solutions & Go-to-Market, delivered the general keynote entitled Creating Competitive Advantage with Business Analytics. It was refreshing in that the keynote itself was less about the latter (SAP’s products) and more about the former. It’s really all about
·         seeking operational excellence
·         providing visibility for better decision-making, including analytics and performance monitoring
·         supporting a risk-aware and compliance culture
·         developing a people and talent agenda
How can SAP help its customers gain this advantage both in general and in the context of GRC specifically? Over the past few years SAP has built an impressive portfolio of solutions under the umbrella of GRC. While a convenient “category,” GRC has never been crisply defined as evidenced by all the different definitions that are floating around. Indeed over the course of the day I spent at the conference, I heard several speakers refer to GRC as Governance, Risk and Confusion. If you are looking for definitions, the OCEG Group Red Book (Standards and guidelines | by OCEG the Open Compliance and Ethics Group) is a good place to start.
For SAP, GRC is a convenient grouping of solutions that have been developed and acquired over time. However, although its GRC portfolio is extensive, it has been more of a collection than a true suite of products. As far back as March 2008 when SAP announced new versions of products across this portfolio it referred to this launch as a “unified approach to GRC”. This launch included new versions of the SAP GRC Access Control, SAP GRC Process Control and SAP GRC Global Trade Services applications. In addition, the SAP GRC Risk Management application was integrated with the SAP Strategy Management application, which was then separated as part of SAP’s enterprise performance management (EPM) solutions. The goal even back then was to enable organizations to drive an integrated corporate strategy that synchronizes the management of enterprise risks, business controls and global trade compliance.
But the solutions were still separate applications built on different technology platforms, without a common user interface. They did not share data or workflows. They felt like different products. They behaved like different products. Therefore as an existing customer who may have started with Access Control, and was looking for a trade compliance or process control or risk management solution, there really wasn’t a significant advantage in sticking with the SAP family of products.
That all changes with GRC 10.0. SAP has transformed a collection of disparate applications into a platform for GRC. There is a common look and feel. Master data can be shared across Access Control, Process Control and Risk Management. For example, the rich organizational structure that was available in Process Control can now be used in Access Control. All use the same workflow structure, supporting integrated monitoring. And perhaps just as important, is the embedded (SAP Business Objects) BI. Excelsius-based dashboards are pervasive throughout the solution and navigational tools such as Explorer are available as well.
Acknowledging the confusion over GRC and relatively low adoption rates (as compared to other enterprise applications), as a platform provider, SAP’s objectives are to simplify the message of what it will deliver, while providing a lot of meat and not just sizzle behind the messaging. SAP knows its goals need to align with the goal of the GRC professional. Simply put, that goal is to proactively balance risk and opportunity to:
  1. Better manage compliance and risk
  2. Better protect value – proactively avoid risk events;  reduce cost of violations
  3. Better perform – actively  link risk and performance management and objectives
In order to do this, the platform must support the ability to analyze, manage and monitor. One key advantage SAP will have over GRC point solutions is in making the connection back to operational systems of record (think ERP). Not only is SAP uniquely positioned to do this with its own ERP solutions, but it is also proactively working with a partner (Greenlight Technologies : Solutions : SAP GRC Cross-Platform : RTA Design Studio for Access Control) to also connect to other business systems such as legacy applications and other commercially packaged solutions.
These are all great enhancements, and create an incredibly comprehensive solution and significant market advantage in turning a collection into a platform. The old SAP probably would have stopped here. But the new SAP took two additional steps.
While SAP has been concentrating on developing the GRC platform and focusing on the technology, management understands a platform is simply a tool. Nobody looks to buy a platform. They look to solve a business problem. So the value of these efforts will be lost if the customer cannot go that last mile to connect to the business, sometimes with very industry-specific requirements. And often that specific expertise must be both deep and broad. The proliferation of regulatory requirements alone these days makes it difficult for any one company to provide this level of knowledge and expertise across a wide range of businesses. So while SAP focuses on technology and platform, it lets partners focus on the domain expertise for consulting as well as the development of plug-in applications through its Ecohub ( ).
And finally, and likely most important for the customers, has been the active listening process. Eighty six customers from the GRC customer advisory council would not have showed up for a daylong meeting with product management and development if they did not feel their voice was being heard. In the course of these types of conversations, three things have emerged: the effort required to manage GRC, the elimination of manual processes and reduction of cost. While in the past SAP may have simply concentrated on offering those high profile but often under-utilized leading edge features, this time it also included a lot of the mundane and boring features that simply can lead to improved day-to-day efficiencies. As a result it has made GRC 10.0 much more appealing to its existing customers. In many cases, the customer can justify implementation based on just one new feature.
Each new customer that moves to GRC 10.0 will be another testament to the value of listening to the voice of the customer.

Monday, March 7, 2011

Activant announces new Business Rules Engine

Last Thursday I questioned whether IT spoke the language of business. In that short commentary, I used a couple of examples. One of them was “abstraction.” I mentioned that, “if you tell a business person you can set up rules that will govern processes once, and those rules will be enforced by all your business systems, then you have introduced the concept of abstraction without having ever said the word.”
Today I read that Activant has introduced a Business Rule Engine for Distributors.  This is exactly the type of feature I was talking about – one that takes the solution beyond the traditional transaction and reporting ERP of old. The Business Rule Engine provides Prophet 21 users with the ability to insert their own business logic into the Prophet 21 code base without altering the application code itself.
Some examples provided by Kevin Roach, executive vice president and general manager of Activant's Wholesale Distribution Division included:
·         Conversion rules that auto-populate some fields based on others -  like the town or city and state based on zip code? These are the types of “smart” features we have become accustomed to through our own personal online shopping experiences. Heck, I was a catalogue shopper long before the Internet and even back in those days I had customer service reps automatically filling in my town and state based on my zip code. But I didn’t see the same intelligence in business applications. This is a very simple example, but there are scores of ways to use this kind of functionality.   Like certain compliance requirements based on type of product.  Activant suggests an item entered with a product group of Pharmaceuticals could automatically set the Pedigree Tracking Checkbox to be checked. Or food and beverage for nutritional labeling, etc.  As new requirements are added, new rules reflect the changes with far less disruption than mucking around in code.
·         Validation Rules:  Another Activant example, Customer A can only buy items with Item Class 1 set to "No Restrictions." The system will provide an error message if an item without that Item Class is entered on an order for Customer A. These validations basically allow for the creation of warnings and error messages based on rules being met or not met.
·         Asynchronous Workflows. A third Activant example… a distributor could set up a workflow so that a purchase order placed in the amount of $5,000-$10,000 triggers an alert to an authorizing manager for signoff, while an order over $10,000 triggers an alert for the CFO's signoff. When the inserted trigger is activated in the Prophet 21 software, the rules included in that workflow will be executed in the sequence indicated.  Those are the rules today, but perhaps during a downturn in business, you need to (temporarily?) reduce those authorization levels or require the CFO to additionally review all purchases. Perhaps the rules tomorrow will add the type of purchase. Maybe a requisition generated for direct materials will be handled differently than indirect materials.
Why are these features and these examples (which appear to be so simple) so important? Because these business rules are subject to change. And if they are embedded within the logic of the application then changes to your business either require changes to your application (think source code and programming) or prevent your business from adapting.
If you are using older, outdated technology, and looking to upgrade or replace…perhaps this type of requirement is not top of mind. But all ERP users should be clamoring for this type of logic to be extracted (or abstracted) from the underlying code so that it puts the power of change in the hands of the business user.

Thursday, March 3, 2011

Does IT speak the language of business?

I just spent a few minutes reading Tom Wailgum’s article entitled SAP and IT: Best Buddies, Worst Enemies. Definitely worth reading as it is so apropos. And apart from the fact that is was posted as ASUG news, the title could probably just as well have been ERP and IT. This isn’t just an SAP problem.
I spent most of my 30 years prior to becoming an analyst working for ERP companies (or their predecessors, because ERP isn’t as old as I am!) During that time … and continuing today… one of the biggest challenges was getting to the line of business LoB executives, past the CIO gatekeeper, during the selling process. Given who ultimately signs off on the deal (often the CFO or the CEO) you would have thought it would be easier. But it isn’t.
Often this is because sometimes the business world and IT appear not to speak the same language. Tom makes a very good point in saying, “…if [SAP] wants to sell to the business, it’s got to be able to talk to the business in a way that not just Computer Science grads can understand.” Again, I think you can substitute any other ERP vendor’s name. I have always made a point of talking about any enterprise business system in a business context, highlighting the successes versus the failures and measuring the success by the business benefits rather than cost, time to implement or other measures that tend to be the domain of the IT staff. In spite of having a master’s degree in computer science, I consider myself much more a businesswoman than a technologist. But even I fall into the IT jargon trap occasionally.
Often some of the most important business benefits result from the effective use of underlying technology infrastructure – like SOA (Service Oriented Architecture). But ask any business person if they care about SOA, and you will probably either get a glazed, disinterested look, or you will lose their attention completely. But if you talk about the benefits of SOA – easier integration, better connection to and communication with their business partners, then it will resonate.
Or take the concept of “abstraction.” The non-IT person might first think of Picasso’s art or Carl Jung’s psychology or philosophy, which I bet wasn’t the favorite college subject of your typical CFO. To a technologist, abstraction is an intuitive concept. It is very difficult to explain to someone esle (who might not have a clue) something that is immediately and intuitively understood. But if you tell a business person you can set up rules that will govern processes once, and those rules will be enforced by all your business systems, then you have introduced the concept of abstraction without having ever said the word. But it probably won’t really mean anything to them until they want to change the rules. If they find they only have to make a simple change once and it is propagated through all the business systems automatically, they now understand the value.
In order for any company to maximize the business value of ERP or any enterprise business system it must be embraced by the line of business executives responsible for delivering business performance. In order for that to happen, either the line of business needs to be more IT-savvy or the solution providers and the IT professionals need to learn the language of business.

Wednesday, March 2, 2011

Weighing in on SAP Sales OnDemand: Keeping competitors off SAP turf

In just one short day there have been numerous commentaries on SAP’S upcoming release of SAP Sales OnDemand, announced at CeBIT yesterday (March 1, 2011). So while I may not be telling anyone anything new, I felt I would be remiss in not commenting. Many have been headlining the announcement as a direct threat to and Microsoft CRM OnDemand. Yes it might be, but not because it competes directly against either. But it just might keep these two competing products out of the SAP accounts.
SAP Sales OnDemand is exactly what the name implies… a tool for sales. It is just one of the three legs of CRM (sales force automation, customer service and support and marketing automation). But let’s face it, many companies that deploy CRM only use it as a sales tool.  Yet in spite of this limited slice of the CRM pie, John Wookey, SAP’s EVP of Line of Business OnDemand claims this solution is unique in that it is a more comprehensive solution.
More comprehensive? How?
Software solutions in the past have modeled a business process in a rather linear fashion. Instead, SAP went back to the beginning and looked at the business problem, which presumably in this scenario was and is, for SAP customers, how to sell more. What are the roles that all come together in achieving this goal? How do they interact now and how do they want to interact? Does it take a “village” to make a sale? When I first heard how good Sales OnDemand was at allowing sales to collaborate I was skeptical. The desire or motivation to collaborate isn’t always included in the DNA of a sales rep. But if it means truly getting a 360o view of a customer, then yes, collaboration is required.
And for that you not only need a sales tool, you also have to connect it to your other solutions, like ERP. I have always argued that a CRM solution does not provide a 360o view of a customer unless you use it for something other than what it was intended for. Where are the transactions, the shipments, the receivables?  And what about the unstructured data that floats across the Internet, feeding you important data about your customer? Feeds about their earnings, legal battles, trends in their market with a direct impact? Take a look at the demo on YouTube ( ) and you’ll see this kind of Feeds and collaboration is really “Home” for the sales rep using Sales OnDemand.
So to me SAP Sales OnDemand is more about connecting the dots. If it can truly complete the view of the customer, the prospect, sale for the SAP ERP customer, then there is no need to look further.

Tuesday, March 1, 2011

When customers have a voice: 3 solution providers who listen well

You probably all have friends out there that send you jokes and other amusing (or not) trivia by email. Some will be selective. Some will not… sort of like two of my cousin who seems to send me everything that comes into her Inbox. The problem with these kind of distribution lists is that there is no way to unsubscribe without hurting someone’s feelings. So the delete button gets a lot of use on my keyboard.
But for the ones that are selective, sometimes there is some useful information. Like just this morning I learned that “a paraprosdokian is a figure of speech in which the latter part of a sentence or phrase is surprising or unexpected in a way that causes the reader or listener to reframe or reinterpret the first part. It is frequently used for humorous or dramatic effect, sometimes producing an anticlimax. For this reason, it is extremely popular among comedians and satirists.” So the first thing I did was forward it to my friend who is also a stand-up comedian. I know he is always looking for material.
But apart from the obvious value to my comic friend, I did find some of these paraprosdokians applicable to the art of developing software solutions. I say “art” purposely. While developing these solutions may be (computer) science, the process of deciding on a product roadmap is far less objective.
For example:
” To be sure of hitting the target, shoot first and call whatever you hit the target.”
This is what happens when the developers (I use the term loosely) make all the product decisions while never venturing out into the real world.
The corollary… “The voices in my head may not be real, but they have some good ideas!”
This is what happens when the developers make all the product decisions while never venturing out of their own space at all.
The result, when the first two are ignored… “You do not need a parachute to skydive. You only need a parachute to skydive twice.”
So the lesson to be learned and applied to the art of developing the roadmap of an enterprise business system is pretty simple:  Listen to your customers. There are 3 developers of enterprise business systems that come immediately to mind here (caveat - I don’t mean to say of course that there are no other solution providers with a particular focus on the customer):
Plex Systems:  You might have heard me say this before, but the reason Plex began offering a SaaS deployment model for ERP long before it was “hot” was because Plex’s founder was an advocate and a pioneer of rapid application development and he was looking for a way to deliver new enhancements at an equally rapid pace. Last year I attended Tom Mackey’s (Plex’s EVP of Sales) worldwide sales meeting. As I watched one of the Plex developers demo something the team was in the process of developing specifically for a large customer and as I learned how long it took the team to create the enhancement (all “customizations” developed by Plex are productized as opt-in features) it struck me that they had gotten this far in the time it might have taken other development teams to tell the sales team why they couldn’t or shouldn’t do it. As this realization dawned on me I heard their head of development say that his team didn’t develop any functionality speculatively. All features and functions were developed by request of a customer or a prospect.
Because Plex was developing features and functions so rapidly there was a time when they were having difficulty keeping up with the documentation. The customers brought this to the attention of management at the Plex user conference a couple years back, but they also brought a solution. Why not have the customers using these enhancements contribute to the documentation, wiki-style? Because these customers were so actively engaged with the company and the development process, this worked out quite well.
Now, there is one downside to this approach. You can’t enter a brand new market this way. But you can expand the boundaries of the markets that you already play in. And that is exactly what Plex has done. Early on, based on its proximity to Detroit, its business was largely in the automotive market. But as it began to expand beyond the state of Michigan, it found many of the features and functions required by other industries were either already built in or very close. For example the product already satisfied the requirements of compliance and traceability in automotive and these were easily adapted to packaged foods. And so on….
Sage Software: Over the past decade, much of Sage’s growth has been by acquisition. However, the second half of 2010 saw a resurgence in organic growth. This has been as a result of a combination of growth by acquiring new customers with an expanded range of offers and increasing share of customer spend through support and cross-selling. In 2010 Sage added 250,000 new customers, half of them here in North America. Now of course, not all of these were ERP customers, but enterprise business systems dominated. And there was also significant growth in spend from existing customers, largely through increased web offerings and a rapidly growing set of connected services – web-based and mobile services that connect to existing products.
Much of this approach resulted from an aggressive campaign to visit and listen to existing customers, which has been a primary focus of the management team. While a new focus, Sage has seen it paying dividends. For example, Sage has seen a growing interest from ERP customers in payment services. By satisfying this need, Sage also benefits since by adding these payment services, it can nearly double customer spend.
Syspro is the third enterprise business system provider that comes to mind when I think of close customer relationships. Syspro reports some of the highest customer retention rates in the industry and largely attributes them to personal one-to-one relationships with its customers, with a heavy emphasis on “personal.” Perhaps it is the South African heritage of the company, but execs like Joey Benedretti (president of Syspro North America) take any issue with a customer very personally. Just go out to their website and search on “awards” and you will see a plethora of nominations and wins. Probably the most telling of these awards in terms of customer focus is the Stevie Award. SYSPRO 6.1, the newest release of SYSPRO ERP software, was presented with a People's Choice Stevie Award for Favorite New End User Software Product at the 2010 American Business Awards last June. SYSPRO 6.1 included over 1,500 new customer-requested features and functions plus ease-of-use enhancements including dashboards, workflow services and process modeling and a new user interface that combines personalization and power-tailoring options.
All three of these solution providers develop a target with purpose and customer focus, listening to the voices of their customers which provide the perfect canopy to float development efforts.