Archive for October, 2008

Are US companies still worldwide leaders?

In a 3 part blog I shared my observations having worked with companies in various countries as it relates to enterprise software projects. A recent article in BusinessWeek: Top Countries in Global Competitiveness confirms my conclusion that, generally, US companies are worldwide leaders.

In a survey of 134 countries based on 12 pillars including innovation the article states:

“The surprise was that the U.S. is still on top,” Blanke says. The world’s largest economy remains second-to-none in productivity and enjoys a flexible labor market, a very sophisticated business culture, and many of the world’s best universities. Robust structural features help it to absorb economic shifts and downturns in business cycles.

There is however a cautionary note in the survey, that the United States’ high debt level and the financial crisis (which are related) are weakening its competitiveness and its ability to adapt.

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How the credit crisis is affecting project management software initiatives

After fourteen years, Tenrox has been through several economic turmoils and shocking world events such as 9/11. The credit crisis is the latest challenge we are all now facing together and it is unlike anything I have seen or heard of in a life time. It is simply amazing almost incomprehensible to me how a small group of mostly innocent but naive individuals, greedy mortgage brokers and deceitful investment firms can cause so much damage to the financial system and the real economy. The list of bank and company failures is truly astonishing. Incredibly, the world's entire financial system is at risk.

Take Lehman Brothers, a Wall Street icon that has been in business for many decades. A month or two before its collapse we got a call from a department head at Lehman who was looking for a project management tool to improve their internal project cost accounting. A few weeks into the sales process we got to the step of the credit check which is something we do when we do not know about the company we are dealing with. When our account executive asked me if a credit check is necessary on Lehman Brothers I smiled and said "Joe, this is Lehman Brothers. I am sure their credit is good."

A few days later Lehman had still not signed the agreement so Joe called to see what happened. His Lehman contact said "Did you read the newspaper this morning?" and Joe said "Yes but I wanted to see if the initiative will still proceed" … Lehman Brothers had collapsed!

We have seen a few project cancellations and delays in the last several months but so far on-demand project management software is still in very high demand in 2008.  Judging from our current pipeline we will close the year on a very strong note. I would not even venture to predict 2009 for any industry or market sector! … we just have to hope that we have looked into but stepped away from the abyss.

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How SaaS impacts integration

This topic was discussed in a PS Village meeting I attended in Atlanta. The participants are service company executives and many wanted to know how everyone else is tackling the enterprise software integration challenge in a SaaS world.

Here are a collection of tips and tricks based on the meeting and our own experiences:

  • Integration SaaS software with other SaaS software is pretty easy. You pretty much have no limitations other than the underlying data exchange possibilities.
  • Integration of SaaS software with on-premise solutions poses more of a challenge and higher risks. This is because most on-premise software do not offer good integration points and run behind the firewall.
  • For any integration avoid reading or writing directly to the database; whatever the application type. Direct database calls is the number one reason why best of breed integrations have had such a bad rap. Direct database reads and writes may break when any of the software applications is upgraded. salesforce.com (the company that made SaaS a commerical success) is a very good example of this. By provided great integration interfaces since its very early versions, and maintaining backward compatibility for those functions, salesforce.com integrations from even 8 or 9 years ago still work today!

Another interesting conversation was around how salesforce.com manages upgrades. Salesforce.com upgrades its entire uses base at once (in a matter of a few days all salesforce.com servers are upgraded to the new version). When a new function is available, the user is given the choice of upgrading to get the new function or staying with the old interface. The upgrades never break existing integrations.

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Why US companies are worldwide leaders (continued) – Project management software, project scope management

In the last two entries I summarized our takeaways after thirteen years of implementing project management software for organizations throughout the World. I described how US companies, in a comparison to their Canadian, Australian and European peers, are more likely to make faster go/no-go decisions in the pre-sales process and dedicate a focused team to the project that is not interrupted by other tasks once the implementation begins. Lets now turn our attention to the differences between US companies and their peers as it relates to project scope management.

In general, US companies have done a better job of defining project scope prior to vendor selection, as well as understanding the strengths and limitations of the enterprise software they have selected prior to project execution. We have run into fewer scope change requests and have been more successful with managing change with a US team. On the other hand, non-US companies are more likely to discover signficant new gaps that adversely impact the project schedule. Let me give you a typical example.

Following a six month sales cycle, including an RFP, demos and vendor selection process, we signed a quarter million dollar deal with a non-US company to remain anonymous but nicknamed ABC for this story. Our service team engaged company ABC’s team to kick off the project. Within days, ABC’s project team had come up with three new system integration projects, many more billing/charge back scenarios, and pay rule exceptions that were not part of the original project scope. Our original service estimates had to be tripled and project timeline risk increased exponentially as a result of these change requests. Needless to say, ABC’s management was not pleased and a blame game ensued where both teams pointed fingers at each other. Ultimately the project was successful, but only at a much higher cost, a much longer period of time before go-live was acheived, and a lot of heated argumented between the two teams.

These are of course generalizations. These findings are not based on any scientific survey or research, and are merely the observations of one software company executive. On many occasions we have worked with organizations outside the United States that operate with the same agility and spirit of innovation as US companies.

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