Is Microsoft losing the ISV plot?

microsoft partner logoVia my work email I received an invitation from Microsoft to session called “Ignite your marketing potential with Microsoft”. The agenda for the session was:

  1. An Overview of the Microsoft Marketing strategy in a world of Devices and Services
  2. Campaign Priority – Cloud OS: Azure, Windows Server and SQL
  3. Campaign Priority – Your Complete Office in the Cloud: Office 365
  4. Campaign Priority – Flexible Workstyles : Windows 8, Office & Devices
  5. The value of these campaigns to you?
    • What is the potential deal size?
    • How can Microsoft help you save on producing the assets? A look at brand tools.

This was sent to a representative (me) of an ISV (independent software vendor) that develops enterprise software.

Item 1 might be somewhat relevant to gauge where Microsoft wants to go, but it’s not really that relevant to an ERP company.

Items 2 is relevant, but as I said to a Microsoft VP recently, “if you want your partners to transition to the cloud, what kind of investment are you prepared to make to help us move?”

Items 3 to 5 are basically irrelevant to us.

So my question is, as the title of this blog, “Is Microsoft losing the ISV plot?”  because it seems as though they have become almost entirely B2C and cloud oriented, and have forgotten the B2B aspect.

Four tips for starting an ERP project

Cross-posted from SYSPRO SmarterERP blog

There has been a post on the SYSPRO blog on how an ERP system can help a business, and also some suggestions on how to select an ERP solution. But if you have read some of the stories about ERP project problems you might wonder if it is worth the risk. The answer to this is twofold.

  1. The reports on ERP project failure mainly refer to large organizations implementing fairly large projects, and are not representative of projects undertaken by small- and mid-size businesses.
  2. It’s how you approach the implementation that is a significant determinant of success or failure.

So where and how do you start?

The lead up to an ERP project is a good time to consider Eli Goldratt’s Theory of Constraints Thinking Processes, which is a set of tools to help organizations identify what can be done to significantly improve any business system. By the time you start the project you should have dealt with the question “Why change?” Now you need to look at the other questions:

  • What to change?
  • What to change into?
  • How to cause the change?

A number of organizations might think that all they need to change is their business system, when in reality they will probably also change and streamline processes, and realign roles and responsibilities. Therefore I recommend the following steps.

1. Do a business process blueprint.

To answer those “what” questions you need to understand the processes that operate in the business. A process blueprint provides a graphical view of the way processes work, who is responsible for the processes, and the interaction between different roles.  It also helps by creating a view of the business that both IT and business can understand and discuss – a common, visually-based language. From the blueprint you can see more clearly what might need to change (e.g., in terms of streamlining processes), and with a decent blueprint tool you can try out different changes to see what might be most appropriate. The blueprint enables you to identify solution gaps and define integration points between IT solutions.

2. Check that the key project issues are covered

Evidence from many projects shows that there are four main factors that create project problems, and so mitigating them will improve the chances of project success.

Main causes of project problems How to mitigate them
Unclear objectives and poor focus Focus on strategy, involve stakeholders and define project teams responsibilities and accountability
Changes in project scope Ensure project team and all affected staff are aligned to work towards common project goals
Lack of appropriate skills Ensure appropriate skills are available
Unrealistic schedules and poor planning Have a good project manager

3. Plan the project in phases

The implementation project plan describes how the transition from current state to envisaged future state will occur – it addresses “how to cause the change?” Plan the project in phases and implement over time, for several reasons.

  • It’s easier to estimate and manage the budget for a smaller set of tasks than it would be for a ‘big bang’ type of approach
  • It restricts the impact of the change to a smaller number of people, which means disruptions to everyday work can be minimized
  • Showing rolled-out wins will keep people motivated

4. Make sure change management is included
Forrester-change management
The biggest cause of failure in IT projects is not software, it’s ‘wet-ware’ (people). Resistance to change can block even the most perfect plans, so building active consensus and buy-in is crucial. Forrester Research offers the following steps.

Lastly, although you may have undertaken a thorough business process analysis, and done the proper project planning, be prepared for unexpected complications that occur during roll-out. This is especially true for manufacturing businesses with complex processes, and where integration with other manufacturing applications is needed. If, however, you have done the upfront work, you will be in a position to handle these complexities without seriously impacting the project or the business.

What is your experience with starting an ERP project? Have you got any other tips to add?

Beatles fifty years on

Fifty years ago today the British pop group The Beatles made their ground-breaking performance on the Ed Sullivan Show in the US, kicking off the so-called British invasion.

Beatles in BournemouthMy personal experience with the Beatles happened a few months earlier. In August 1963, the group played in the English south coast town of Bournemouth, which was about an hour’s drive from where my family lived.

My father was overseas at the time, and my mother took the remarkable step of taking my younger brother and I to see one of the performances.

As I was only seven years old at the time, and my brother was five, I remember feeling a little out of place as we queued to get in because there were lots of teenage girls waiting as well. But with adult hindsight, my mother would have been a few decades older than anyone else there.

That concert introduced me to the phenomenon of Beatlemania. It didn’t happen right at the start of the performance, but during one of the songs the (mainly female) audience got so excited that my brother and I had to stand on the arms of the theatre chairs to see the band.

Postscript: About thirty years later I repaid my mother for her kind action by taking her to see the first concert that the Rolling Stones did in Johannesburg. Once again, she was still the oldest person at the show.

No end to B2B and B2C

marketingThere are several analysts and marketers who are have been saying that the distinction between B2B (Business-to-Business) and B2C (Business-to-Consumer) marketing has ended.

I first saw this view in a Harvard Business Review blog where analyst R ‘Ray’ Wang commented that

The emergence of extremely viral people-to-people (P2P) networks has changed the notion of the customer and employee forever. Social media, social networks, and mobility also herald the death of B2B and B2C as we know them.

This was repeated by a marketer who wrote ‘There Is No More B2B Or B2C: It’s Human To Human, H2H.’

I have not been convinced of this view. There are valid reasons why marketers separate B2B and B2C (as mentioned in the Wikipedia entry).

  1. Transaction volume and type. A business can have many B2B transactions in its supply chain processes involving different suppliers, materials and components, but only one B2C transaction.
  2. Buying decision. For an individual there is (usually) one person making the buying decision, whereas in a business there will be many people involved in coming to the buying decision.
  3. Buying process. A business usually has many criteria to weigh up in determining what to buy, and a lengthy and sometimes complex process before finalising the decision. An individual has fewer criteria and a fairly simple decision process.
  4. Brand image. People often buy something because of its brand image. Businesses may be influenced by certain industry brands, but other (often technical) issues can have a major influence as well.
  5. Risk. For a business buying a product (software, machinery), the benefit of the product has to be considered against the risk of going with that product, especially with high-value purchases (e.g., machinery, enterprise software). For an individual, risk is not issue, even for a purchase like a house.

An article by venture capitalist and technology strategist, Geoffrey Moore, writing about an updated edition of one of his seminal books ‘Crossing the Chasm’ points out the difference between B2B and B2C by discussing what makes a successful business product as opposed to a consumer one. There are two different models involved:

  • For businesses, the model of the Technology Adoption Life Cycle defines the characteristics and behaviours of different types of business buyers.
  • For consumers, Moore identifies a separate model, the Four Gears, a framework upon which to build a consumer-oriented business.

Those are enough reasons why B2B and B2C are different, and cannot be pulled together. Are there any more? If you disagree with my view, what are your arguments?

Update: I can across these two related blogs, which give a different perspective to the B2C vs B2B debate.

My 40 years in South Africa

40 years in South AfricaForty years ago today, 13th January 1974, I landed in Johannesburg at the then Jan Smuts International Airport (now OR Tambo International Airport). My father had been living there for about a year, and as I had finished school in England and had no other plans, it was deemed OK for me to go to South Africa and see what I could do.

At the time it was going to be a short temporary stop, but as of today it has been a long one. In England at that time university was not considered necessary, but thanks to my Dad’s contacts who said I should go, I ended up going to university in Johannesburg, and that basically established my future path.

One of the original reasons for thinking my stay would be temporary was of course that South Africa at the time was becoming a pariah state due to its apartheid policies. But even though I was aware of it, the way life was lived by white people in those days, you didn’t see the bad side of the racial divide – because now I realise that the government made sure we didn’t see it. It was only through being conscientised at university that I began to realise apartheid’s impact. But it took events twenty years later like the Truth and Reconciliation Commission for white people to really understand what apartheid was like.

When I arrived in South Africa, the population of the country was about 25 million (http://en.wikipedia.org/wiki/Demographics_of_South_Africa). The latest census figures show population in 2011 was 51 million. In 1974 South Africa was a police state with fairly strong censorship, today we are a constitutional democracry with a good deal of personal freedom (although I now think that some censorship would be a good thing). In 1974 South Africa claimed to be a Christian state, however as Beyers Naude pointed out, apartheid was not scriptural and its effects were unacceptable. Today it is a secular state with what is considered one of the best constitutions in the world.

In 1974 South Africa didn’t even a national television service – the Nationalist government considered it bad. Now we have more television stations available inside the country and internationally than could have been imagined forty years ago. In those days, the only way to communicate with people other than face-to-face was via the telephone, now we mobile telecommunications and the power of the Internet.

In 1974 the only family I had in South Africa was my father. Now I have a wife, three children, a future son-in-law, some wonderful friends, a great church family, and good colleagues at work and around the world.

In 1974 my father could fill up the 40 litre petrol tank of his car for R10; now the same amount costs over R500. In 1974, the SA Rand:UK Pound exchange rate was about 1.5:1, now its 17:1.

In 1974 my father and I lived in a 2 bedroom flat on the outskirts of the Hillbrow flat land (then it was a cool place for a young guy to live). Now I live in a four bedroomed house in the suburbs of Randburg, and have a holiday cottage on the Garden Route.

In 1974 the area where I now work was rural, and people who lived here would have been considered as living far out. Now this is part of the built-up area of northern Johannesburg. Ten years ago, it was a dream of mine to working at this company, but I could not see how it would happen. I have now been here for nearly five years.

In 1974 computers were huge machines that were housed in cooled rooms and managed by people in white coats; the early experience I had in second year university made them anathema to me. These days I have a small cell phone with more computing power than those 1974 behemoths, and I have been working with computers for thirty years.

I wonder what is going to happen in the coming years?

Email or social networking – which is better for business communication

Back in 2011, it was briefly news that a large company had banned email in favour of instant messaging and social networking tools. This decision looked to be an early reaction to the restrictive paradigm, that of the old postal-style communication just transferred to a digital version. Today it seems that decision could be considered rare, even unique. Email is still the predominant communication mechanism in business.

The original idea of social networking at work using digital technologies was proposed by Andrew McAfee in 2006 who introduced the term ‘enterprise 2.0′. He believed the advantage of these new technologies was that:

they can potentially knit together an enterprise and facilitate knowledge work in ways that were simply not possible previously.

Two bloggers have recently had opposing views on the issue of email vs social networking debate. JP Rangaswami, chief scientist at Salesforce.com, commented in favour of social networking, whereas Sameer Patel, whose job at SAP should espouse the same view, actually seemed to promote email over social networking.

Taking Rangaswami’s argurment first, he points out that initially (in the 1990s) email was good, allowing people to send quick, informal, short messages. Then it became more formal and email started to look like standard company memoranda. As email became an enterprise function, it got corrupted further – turning into a broadcast mechanism controlled by the sender, and consensus-by-email became a way of decision-making.

Rangaswami mentions two problems with email.

1. Because threading is often not possible, discussions become fragmented.

the fragmentation caused by email sometimes takes a darker route. Person A sends an email to a group of people. Some of them reply-all, seeing that it is the right thing to do. A few others then corrupt the conversation, by taking a few people off the recipient list and adding a few more, with liberal doses of cc and bc. Before you know it there are now multiple conversations with different carefully-chosen groups of people, with only a few, usually politically-motivated, members playing puppetmaster to all the conversations. Cut-and-paste then comes into play, as segments of one set of conversations get viewed in other, exclusive, environments.

2. How to handle email on vacation

[With social networks] you choose whom you follow. Amongst the people you follow is this class of person called your friend … These friends know you, know what’s important to you. Sometimes they even know what’s important to you despite your not recognising or acknowledging that importance … You no longer have to read every email. When you come back from vacation, whatever has passed in the stream unread can stay unread …  Because you have a network of friends. They will DM you or private message you about the things that are important. They will SMS you or text you or IM you or Whatsapp you about the things that are urgent.

On the other hand, Sameer Patel makes these comments, referring to social networking as a ‘stream’ or ‘feed’.

You can hardly tell your boss that you missed an important update from him because you didn’t happen to be watching the stream.

There is a place for a feed in enterprise as part of a larger tapestry of interaction models. It’s an excellent way to ambiently learn and get wind of many things.

The world of work demands a significantly more decisive design [ie, email] – to facilitate closure of the repeatable tasks … yet with a facility that that helps me manage exceptions that will undoubtedly show up, unannounced.

I find his argument that social networks are not designed to drive closure seems hard to substantiate. Referring to the future of business communication, however, he does make a good point.

Business applications that will ultimately resonate won’t be about transactions or about social feeds but understanding the interplay between data, people, applications and content to get stuff done.

Almost in support of Patel, one of the big promoters of ‘social enterprise’, CEO of Salesforce.com Mark Benioff, is now cooling off on the subject.

In his original paper, McAfee did mention that there would be challenges for the new technology.

1. Employees will be too busy to use the technology, despite training.

2. Management will see it as reducing their ability to control, and opening up avenues for dissent.

It seems that cons of social networking are still working in favour of email. I don’t think that the debate has ended, though.

What are the case studies of companies who have successfully moved from email to an enterprise social network?

2013 in review

The WordPress.com prepared a 2013 annual report for this blog.

Here’s an excerpt:

A New York City subway train holds 1,200 people. This blog was viewed about 4,900 times in 2013. If it were a NYC subway train, it would take about 4 trips to carry that many people.

Click here to see the complete report.

Where are the big tech companies going?

competitionWhat I would call the “old tech companies” – SAP, Oracle, and to some extent Microsoft – seem to be getting further away from the core where they started, and are beginning to look more like IBM and HP.

This notion was kicked off by Vinnie Mirchandani’s question ‘What happened to the SAP I knew?

It used to be in tune with business process leadership … Its (reduced) attention to apps has been diffused even more by years of seemingly wasted BYD investment and digesting acquisitions like SuccessFactors.

Oracle has strayed from the software path into hardware, and competes against ‘former’ partners IBM and HP. It seems like the company wants to own not only the vertical stack – from base hardware up to the software applications – but also wants to have a piece of the entire software value chain, for example, buying market automation maker Eloqua and content vendor Compendium. Apparently, the reason for this is to build a portfolio of applications to compete against Salesforce.

When it comes to Microsoft, they now wants to focus on “high value” activities that consumers and business users prioritize. Is that code of owning more of the customer’s wallet? The new Microsoft strategy is discussed further here and here. In some cases, Microsoft’s strategy seems quite different, but it also seems to be doing much the same as the others.

The situation that SAP and Oracle are putting themselves into was nicely described as being ‘too big to succeed.’

… anyone visiting Oracle OpenWorld this year would have seen a company teetering under the sheer bulk of the steroid-drip of acquisitions it has made over the years …
… SAP has also bulked up its product and customer base, and there’s a genuine risk that, at least when it comes to the SAP field sales team, it has become increasingly difficult for anyone outside to top echelons of the company to articulate the full value of SAP’s vast portfolio to customers and prospects …
… I think it’s time to admit that economies of scale work well in industrial companies with industrial processes, but sheer size is no advantage in a service economy. In a service economy, or any economy that depends on getting people to come together in order to provide innovative services to customers, doing more with less – the mantra of the economies of scale mavens – simply doesn’t work.

What really gets me about the strategies these companies are pursuing is that it seems to show they are more worried and more focused on growing revenues for shareholders, than what their customers want.

Any comments?

Responsiveness of cloud-based software

Clouds
For a while I have been using a web-based service called Mammoth. Mammoth allows you to save text, images and other online content, as well as notes, into a single place for later use. In my case, I use it when researching issues I need to write about, or reference, for my job as a product marketer.

Mammoth allows you to create ‘boards’ which store the content about a particular subject. Boards can be shared so that people in different locations can edit the content collaboratively. A standard board in Mammoth is ‘Talk to Us’, which is shared with the Mammoth support team, and this allows me to address any issues I have with Mammoth online. Whenever I have logged an issue, I get a response via the board usually in a few hours.

In one case, Mammoth made a change to the user interface (UI) which made it look worse for me, so I logged a note on the Talk to Us board. There was a bit more discussion and clarification about the UI issue on the board, but what interested me was that 24 hour later when I logged on to Mammoth, the UI problem had been addressed. The application was fixed and changed without me having to do a thing.

It made me re-evaluate my view of cloud-based services.

  1. A problem with an on-premise application always requires the user to do something to fix it, usually download and install a software patch. With a cloud service, the problem is fixed once in the cloud, everyone gets it at the same time, and new software has to be installed.
  2. A problem with on-premise software is reported either by a phone call or an email, which then has to be discussed and confirmed before it can be transcribed and referred to the software development team. With a cloud service, you log an issue online in one place, the issue can be quickly confirmed and then be relayed speedily to developers.

Imagine if you could do that with enterprise software – ERP, CRM, warehouse management.

  • Customers could report problems so much quicker, and probably have a better support experience
  • No need for each customer to update the software with maintenance releases to fix bugs
  • Customer could log enhancement requests in a more effective way, and perhaps even get previews of enhancements before they go live
  • The development team work on supporting one codebase, in one location, for everyone
  • No need to ship CDs of software around the world

Wouldn’t that world be better? Oh wait, it’s called Software-as-a-Service and it’s here already.

The problem is that while the promise sounds simple and wonderful, the realities of transforming to that promise require major changes in thought, approach and practice – and moreover, for traditional software vendors, major investment expense.

The response to SAP’s Business ByDesign decision

softwareThe recent report that SAP was cutting back on development of Business By Design was widely reported. Here are some comments about it.

ZDNet

ByDesign is intended to serve “mid-market” companies …At launch, executives projected that the $4 billion software suite would generate $1 billion in annual revenue. Yet it is expected to generate no more than $35 million this year… Only a small team in India will take care of the maintenance of the software 

Forbes

SAP has been guilty of trying to own the entire ERP market by itself, rather than building a broad ecosystem which they are a part of – mid sized customers weren’t keen to be customers of SAP and by failing to embrace a more vibrant industry where small organizations could use third party products but would have a logical migration path as they grew or were acquired, SAP has done both its own business, and the market as a whole, a disservice.

PCWorld

Developed at reportedly great expense, the product was initially expected to have 10,000 customers by 2010 and be generating €1 billion (US$1.4 billion) in revenue for SAP. Instead, ByDesign has about 1,100 customers today

And from a SAP partner trying to do some repair work

SAP Business ByDesign, and its users, will in fact benefit from this leading technology [SAP HANA]… especially as SAP refactors parts of the SAP Business ByDesign platorm, so to take maximum advantage of SAP’s HANA breakthrough capabilities as well as dramatically improve speed and usability. As part of this, all of the know-how of SAP Business ByDesign is being preserved, and likewise is brought forward to benefit your business.

Of course, a cloud ERP vendor had to put the knife in. 

There was a major brouhaha when word leaked out that SAP was finally burying its ill-fated cloud-based ERP system, Business ByDesign. I assume it must have been a slow news week because no one could really have been surprised.

In my opinion, it is a sign of something happening in the cloud ERP space – maybe that the demand isn’t as great as the big vendors originally anticipated. Or it’s another failed attempt by SAP to penetrate the mid-market. What’s your view?