Archive for category Enterprise Software
Which company do you think Oracle will acquire next?
Posted by Rudolf Melik - Project Management Software Blog in Enterprise Software, project workforce management on August 4th, 2010
A fellow blogger from ERP Software Advice asked me to post an entry for this survey so you can all vote on Oracle’s next acquisition. The article includes a pretty detailed analysis of Oracle’s acquisitons and potential new targets. Please visit the site and vote.
The future of ERP: Why the ‘big ERP’ approach is dead
Posted by Rudolf Melik - Project Management Software Blog in Cloud computing, Enterprise Software, project workforce management, software as a service on February 22nd, 2010
Interesting in-depth analysis by Infoworld on how the traditional huge multi year enterprise software investment and implementation paradigm has changed as a result of competitive pressures, technology (primarily cloud computing), the current economic chaos, and other world events.
Industry consultant Reed sums it up this way:
“‘Empower me. Give me the tools to create differentiating processes that allow me to define myself from my competitors. And make sure that it’s easier for me to do, so I don’t have to hire 100 programmers. Give me the building blocks to put that together quickly, so that it’s just humming in the background, and leave me free to focus on what makes us better than other companies.’ That’s what customers are expecting now and really want.”
Here are some other noteworthy informational tidbits:
The “single global instance” dream dies: One ERP system: a single, global instance of business software applications running our entire business and our business lines, seamlessly uniting our CRM, supply chain and business analytics applications. Efficiencies. Integration. Savings. Fewer headaches. That’s been the dream at many companies and for CIOs since Y2K — a dream most often fed to them by eager ERP vendors.
Bill McDermott, president and CEO of SAP America, stares out the tinted glass wall overlooking the bustling convention floor and then dives into the same pitch he gives the pilgrimaging executives [at SAP's Sapphire event]. “You have ERP,” says SAP America’s CEO. “The next step is to expand it to CRM and the supply chain.” The idea, he says, is to control all the data in a company by standardizing on one system for the front end and using one data source for the back. His pitch reaches its climax when McDermott sounds the message SAP has been trumpeting all week: It’s time to move to a single instance.
In other words, McDermott is telling CIOs to forget the multiple systems their companies use today, rip them out, and replace them with one ERP system — with one data store — that serves the entire company, no matter how diversified or geographically spread out it is. That, he says, is how to get the most bang for your IT buck.
That dream has now faded for many companies. Even at SAP. “I think the concept is evolving,” Say contends. “There’s a pretty open acknowledgement that — is it practical to get to a single instance across all functions of a very large, global enterprise? No. That’s not a realistic goal any more. We’re living in a world where multiple systems have to be networked together, have to communicate openly with each other and need to have sophisticated enough infrastructures on top so that the business can manage it.”
…
The “more evolved” thinking, Say suggests, is this: Companies can achieve consistencies and efficiencies in their business processes without having to use one singular system that manages the entire landscape.
…
Call it what you will: software as a service, on-demand computing, Web-based software, cloud computing. Doesn’t matter, because business software experienced via an Internet connection and browser is already here. Resistance is futile, stupid and short-sighted. At this point, however, no one (save for the SaaS vendors, perhaps) is advocating for wholesale rip and replaces of on-premise ERP installs.
…
But as enthusiasm for traditional, on-premise, expensive and complicated software deployments wanes even further, Web-based software options hosted in either public or private clouds will become even more attractive for companies big and small looking for low costs and easily consumed apps, analysts say
…
“The supervendors have architected enormous complexity in order to be able to sell across so many different verticals, in so many industries,” says AMR’s Richardson. “I think there’s a need for simplicity, and the Salesforce.com and Workday people get that.”
What is amusing is a quote from an ERP cloud vendor with their “anytime, anywhere access” mantra and slogan as if their one size fits all ERP “suite” message is any different from the mega vendors like SAP, Oracle. The bottom line message of this article is the “big one size fits all software” days are over or numbered at best.
By the end of 2009, Gartner forecasts that global SaaS revenue will reach $7.5 billion, which is an 18 percent increase from 2008 revenue of $6.4 billion.
Looking out even farther, Gartner predicts that the SaaS market will show consistent growth through 2013 when global SaaS revenue will total more than $14 billion for the enterprise software markets.
Two years from then, in 2014, is when Saugatuck predicts big change: “SaaS will become integral to infrastructure, business systems, operations and development within all aspects of user firms, with variations in status and roles based on region and business culture.”
“There are many things happening here that are good for users, good for the IT profession, good for business. It’s just good, good, good,” Pierce says. “You know, what’s slowing this adoption are all the priests of the past — all the preservationists. All the interests that are built up around the edifice that is enterprise software. … Cloud computing is a dream come true.” says Todd Pierce, CIO of Genentech
Acquisitions aside, how will the cadre of ERP vendors approach the future? Like those robots in the Transformer movies, the MISOH cartel, and other traditional ERP entities will have to change their “shapes,” and alter their strategies to stay with the times (and already have, to some degree). That means embracing — rather than resisting — on-demand and SaaS-based computing software-delivery models. And you can bet you’ll be seeing fewer and fewer “cloud computing” rants from big ERP execs, like the one that Oracle’s Ellison gave in fall 2009.
For example, in an odd 2008 interview with ZDNet, Lawson Software CEO Harry Debes proclaimed that the SaaS industry would “collapse” in two years. In the interview, Debes also noted that Lawson was a happy Salesforce.com user. In fall 2009, during an interview with CIO.com, Debes stands by his comments, saying that the feedback from Lawson’s customers at the time, which was that they did not want a SaaS solution, “was compelling.” That’s changed. And today, Debes says, “I’m a very big fan of cloud computing,” though his on-premise business still has a bright future, he contends.
Talkin’ ’bout the next generation
It’s just that the recession and years of questionable return have forcefully introduced a new strategy: Leave the commodity ERP processes to the back office (such as payroll and HR), but make damn sure that front-line users are freed from the banality and inflexibility of the Ghosts of ERP Past.
Industry consultant Reed sums it up this way: “‘Empower me. Give me the tools to create differentiating processes that allow me to define myself from my competitors. And make sure that it’s easier for me to do, so I don’t have to hire 100 programmers. Give me the building blocks to put that together quickly, so that it’s just humming in the background, and leave me free to focus on what makes us better than other companies.’ That’s what customers are expecting now and really want.”
Bill McDermott, president and CEO of SAP America, stares out the tinted glass wall overlooking the bustling convention floor and then dives into the same pitch he gives the pilgrimaging executives [at SAP's Sapphire event]. “You have ERP,” says SAP America’s CEO. “The next step is to expand it to CRM and the supply chain.” The idea, he says, is to control all the data in a company by standardizing on one system for the front end and using one data source for the back. His pitch reaches its climax when McDermott sounds the message SAP has been trumpeting all week:
It’s time to move to a single instance.
In other words, McDermott is telling CIOs to forget the multiple systems their companies use today, rip them out, and replace them with one ERP system — with one data store — that serves the entire company, no matter how diversified or geographically spread out it is. That, he says, is how to get the most bang for your IT buck.
Gartner Highlights Key Predictions for IT Organizations and Users in 2010 and Beyond
Posted by Rudolf Melik - Project Management Software Blog in Automation and Collaboration, Cloud computing, Current Affairs, Enterprise Software, IT Management, project management, software as a service on January 21st, 2010
Here are Gartner’s predictions for the coming years in IT:
http://www.gartner.com/it/page.jsp?id=1278413
The most interesting one is “By 2012, 20 percent of businesses will own no IT assets”. The argument they make is that essentially more and more organizations will use cloud computing and refrain from buying their own equipment. Also, more and more users will access corporate data using personal mobile communications and their own laptops. In other words the company will own and control less hardware; the equipment will all be owned and managed by third parties.
This is a surprising and rather aggressive prediction. I agree with the trend and I can see a future in which IT departments focus a lot more on strategic initiatives rather than managing now commoditized IT equipment and infrastructure. Cloud computing is radically transforming the IT function and will have a major unquestionable impact on IT budgets and how IT is perceived within the organization. But 2012 is awfully close. I do not think the transformation will occur so quickly.
The Laws of Simplicity
Posted by Rudolf Melik - Project Management Software Blog in Automation and Collaboration, Enterprise Software, project management, project management software, project workforce management on January 20th, 2010
In these prior blog posts:
Occam’s Principle Applied to IT Investments
I outlined how Occam’s Razor principle could apply to product design and IT investments. I recently stumbled on to the writings of John Maeda who has authored a book on the laws of simplicity. A summary of the laws can be found here:
http://lawsofsimplicity.com/category/keys?order=ASC
A review of the laws is a good refresher for anyone in charge of project management, new product development and software design. The last law states: Simplicity is about subtracting the obvious, and adding the meaningful. This is actually Occam’s principle which I described and provided some examples for in the above mentioned posts. In fact as John Maeda mentions in his book and on his website Occam’s principle is really an encapsulation of the first nine laws.
The Year in Review in Software & Services and 90% Software Maintenance Margins
Posted by Rudolf Melik - Project Management Software Blog in Enterprise Software, project management software, project workforce management, software as a service on December 25th, 2009
Here is a good short review of enterprise software and services stories in 2009.
What caught my eye was Brian’s referral to 90% software maintenance margin as a bad thing. Brain, most software companies invest significant dollars in infrastructure, R&D and new product development. Healthy profit margins from on-demand services and support are an absolute necessity. Without those margins no software company can attract great talent, investors or even consider any new ideas.
As an example, at Tenrox while 9 out 10 new customers are opting for Tenrox on-demand we still do have and support on-premise customers with perpetual licenses. One of these customers had gone without support for eighteen months thinking the software works great and they do not need our support, updates or innovations. Well something went wrong and they called our service team asking for help. They wanted to pay time and material for us to jump on the problem and fix it. We explained our policy that they must reactivate support, pay a penalty for the reactivation, and get up to date before we can even look at the problem. This customer was quite frustrated and did not take the news very well at all.
As a software company we have no choice but to establish such policies. Tenrox is not a consulting “time and material” provider. The profits and good margins from on-demand services and support are absolutely essential for continued innovation and first class customer support.
Interview with Microsoft Project’s Seth Patton
Posted by Rudolf Melik - Project Management Software Blog in Enterprise Software, project management, project management software, project workforce management on December 9th, 2009
Here is an interesting interview with a marketing director at Microsoft Project regarding their product roadmap and strategy.
http://www.enterpriseirregulars.com/500/interview-with-microsoft%E2%80%99s-seth-patton/
I guess Seth has not kept up to date with technology trends all that much. If Microsoft’s strategy is to try and drive out independent software vendors (ISV) they are not going to do all that well with their customers or partners. With Software as a Service and cloud computing, best of breed is a clear hands down winner in this market. Just look at the huge success stories of salesforce.com, RightNow, Taleo, and Success Factors all of which are SaaS offerings; there are so many more SaaS and cloud winners out there. I think Microsoft is better off focusing on strengthening its ISV partnership base instead of alienating them with this kind of thinking and interviews. This is not forward thinking.
Here is another interesting exchange in the interview:
While PPM products, Microsoft’s included, contain many of the functions needed by professional services firms, they are still some key functions not available within Project just yet. These include: client billing; dedicated time entry for vendor, client, contractors, etc.; two-way interfaces with payroll systems; proposal tools; and, more. Nonetheless, Seth reminded me that thousands of Microsoft partners are service firms as well as users of Project in client work.
This sounds a lot like the old we have it all ERP type of talk. Well then I guess customers should wait another 10 years for Microsoft to develop these and other capabilities. Or customize the heck out of Microsoft Project to fulfill the gaps they perceive in the solution and to get what they need like these other companies he mentions have.
I still remember the first time I read a brochure from one of these large vendors. The brochure said they do everything under the sun. I got the same impression with virtually every release of Microsoft Project. To this day, all of these products have only fallen behind more, become more bloated, more complicated, and more out of touch with what customers really need.
The 2009 Chaos Report – Is Project Success Really that Rare?
Posted by Rudolf Melik - Project Management Software Blog in Enterprise Software, Good Books and Articles, Project-Based Solutions, project management on August 10th, 2009
The Standish Group released its widely quoted report (available for purchase here) on project success in April 2009. The latest report is based on a survey of more than 300 organizations and 30 interviews. A summary of the findings is shown in the figure below.
The news is not very positive. According to this report the number of IT projects that failed has actually increased since 2006, successful projects are also alarmingly harder to find. Here is a far smaller and less official survey on software project success rates.
From our own experience and all the anecdotal evidence I have gathered projects are often late and over budget but they are mostly successful. In my opinion the Standish Group’s survey is overly pessimistic on the success rate of IT projects. I find nothing on the Internet that explains Standish Group’s survey approach or confirms these findings. It would be better if they provided more details as to how they assess project success and how they can backup their claim of a negative trend in worldwide IT project performance.
The report did not highlight any new reasons for the higher project failure rates. There are many more capable and highly qualified project managers today than in 2006, there are better tools, an abundance of easily accessible information on project management lifecycles and methodologies, and better collaboration between all project contributors/stakeholders. I simply cannot see how the end results can be this bad.
Occam’s Principle Applied to IT Investments
Posted by Rudolf Melik - Project Management Software Blog in Enterprise Software, project management software, project workforce management on July 16th, 2009
In a previous blog I looked at how Occam’s principle can be applied to product design and development. Now let’s look at applying this principle to making IT investments.
The question to answer: How long should I stay with the technology I have already invested in and should I choose to stay with our existing IT investments or move to a brand new technology?
Applying Occam’s rule to IT investments could go something like this:
- Choose technologies that are simple to use
- Use just one IT system to automate a specific function
- Don’t oversimplify
1) Choose technologies that are simple to use
All things being equal, such as cost of adopting the new technology versus cost of staying with the current technology and processes, choose the simpler alternative. If the new technology is easier to implement and support then making the new investment is the right choice. If not, best to stay with the existing technology.
2) Use just one IT system to automate a specific function
We often run into organizations that use several different systems for time tracking, project management, workforce planning and billing. Most of the time this is because every group or department chooses and implements the solution it prefers.
As an example, accounting staff are naturally biased towards accounting applications. As far as they are concerned, everything including project cost and revenue data should be driven by the accounting system. However, IT, project or professional services staff hardly ever choose such an option if they have any say in the project management software they use. The time tracking, job costing, project management and workforce planning add-on’s offered by accounting systems tend to be subpar, based on older technology, and at best mediocre applications. This is because these are not the main focus areas for accounting software or ERP vendors. Similarly, IT and project teams would never choose a departmental project management solution for its strong financial reporting and accounting integration capabilities.
In applying Occam’s principle, accounting, HR, IT, professional services and project teams have to collaborate much more before making new enterprise software investments. Any investment that reduces the number of redundant systems, eliminates manual integration and reporting, or breaks down the communication barriers between various teams is a definite move towards the key elements of the OCCAM principle.
3) Don’t oversimplify
As mentioned in the previous blog you should not try to take things too far when it comes to simplifying. As an example, IT investments must take into account and accommodate the unique requirements of various stakeholders and constituents. Imposing oversimplified washed down software that everyone in the company must use may standardize a process at the expense of lost group-specific productivity, flexibility and innovation.
Let’s look at an example of a typical project management software initiative. A prospect contacted us to investigate whether they should invest in Tenrox Project Workforce Management software. They had the following project management software investments:
- Timesheet: an in-house timesheet application they had developed a few years ago and maintained over the years; customized to run on top of their ERP/accounting system
- Expense reports: using Excel file to report and approve expenses
- Project planning: using Microsoft Project desktop to plan projects
- Billing/cost reporting: done manually by extracting the information required from the timesheets and expense reports
Should this prospect:
- Change only the timesheet application
- Change only the timesheet application and automate expense reports with a single time and expense tracking solution
- Change all systems at the same time; replacing them with a single solution
- Do nothing – stay with their current systems for another year
According to the OCCAM principle the simplest approach that does not create redundancies or oversimplify is the best option. Let’s look at each option in that light:
- Change only the timesheet application
- If the old timesheet system has no major shortcomings, this option replaces one working system with another; without really creating any new value. Changing just the timesheet system in such a scenario does not add any value. - Change only the timesheet application and automate expense reports with a single time and expense tracking solution
- This may be a suitable option. Two disconnected systems are replaced with a single system and the new system is simpler in that manual processes and spreadsheet are eliminated, and a standard approval process is used for time and expense tracking and approval. - Change all systems at the same time; replacing them with a single solution
- This option may oversimplify requirements of the various teams that need a project workforce management solution to get their job done. However, if all user groups conclude that a new system is as good as their current system, is as simple or simpler, and even solves some existing issues then this is the best option. - Do nothing – stay with their current systems for another year
- Staying with legacy disconnected systems is definitely not the simpler path to choose. While on the surface the company does not take any risk, using old disconnected processes to manage in today’s highly connected and competitive world is the worst option.
Unlocking the cloud
Posted by Rudolf Melik - Project Management Software Blog in Enterprise Software, project management, project workforce management on June 16th, 2009
Here is an interesting perspective on cloud computing from the Economist. The article contends that customers subscribing to an on-demand service should be wary of data ownership and the data migration difficulties they will face when moving their data from one SaaS (software as a service) vendor to another. The author positions open source as a liberating technology and sees cloud computing as new attempt by software vendors to lock-in customers.
This is the first time I ever heard anyone argue against cloud computing. To tout on-premise open source systems as liberating technologies and to call SaaS and cloud computing as a step back is simply out of touch with what is occurring in the marketplace. At the heart of its argument against cloud computing is the lack of standards for moving data from one service provider to another. However, the same can be said for migrating data from one on-premise solution to another, whether open-source or not. For example, have you ever tried moving data from an Oracle application into a Microsoft or SAP application? No common standards exist today that would automate the migration of any form of enterprise data from one solution provider to another.
However, the process of importing data has become a relatively painless, inexpensive and a low risk activity for most forms of data. Data in most modern enterprise applications (on-premise or on-demand) is represented in XML or can easily be exported to XML, now a ubiquitous standard for data representation and data exchange. Using XML, just about every cloud service provider (and even legacy application providers) have the tools and the expertise to migrate data from the customer’s current formats and systems. There may of course be some minor challenges to overcome and the migration may require investment in a few days of consulting services but I do not at all see how data migration results in vendor lock-in.
One thing that customers need to make sure of is data ownership. Tenrox project management software and workforce management customers own their data, whether they are on-demand or on-premise. This assures our customers that they are totally free to move to another service provider.
Cloud computing has tremendous benefits for the customer. The service provider takes care of all the details of software maintenance, bug fixing, data backups, 24/7 availability, 99.9% up time, data security audits and certifications, bandwidth, worldwide access, and much more. This frees internal IT to spend time on more strategic work such as IT project portfolio and resource optimizations, data analysis, portal/report development, and activities that are directly related to the company’s core business.
Investing in project management software and the hair loss doctor
Posted by Rudolf Melik - Project Management Software Blog in Enterprise Software on April 6th, 2009
As I got the idea for this blog I thought a small cartoon strip would help convey the message much more clearly. My artistic skills however are sorely lacking and the Tenrox Web team is way too busy for me to dare ask for their help to develop a cartoon, for a blog no less.
So as everyone does these days I launched a new window and searched for “make a cartoon”. The second entry ToonDoo – The Cartoon Strip Creator – Create, Publish, Share, Discuss! sounded interesting, relevant. Amazingly enough, this is a totally Web based easy to use cartoon making site. It took me less than 10 minutes to make the strip below using the most basic elements offered by the site. Of course, my children (11 and 
have already far exceeded what I was able to do. They quickly learned how to design their own avatars and have created some pretty amazing cartoon strips.
Back to the original subject for this blog, we live in very interesting times. In good economic times a rising tide lifts all boats. On the other hand, as we have seen, a severe economic downturn exposes the true state of all structurally flawed organizations, and incompetent leadership. What amazes me our headlines like this:
Company X, the leading provider of workforce management software, cuts jobs. A cut of about 8% of its global workforce as of January 9, 2009.
Y, the leading provider of on-demand project management software, announced its third round of layoffs. The company laid off 25% of its workforce in this round.
These same project management and workforce management “optimization” companies are advertising their expertise and pushing their solutions as the best software tools one can invest in. If they cannot plan and manage their own projects and workforce properly how can they claim to help anyone manage their resources any better? This is the definition of hypocracy.
Unlike many of our competitors who have suffered through multiple layoffs. Tenrox has cautiously hired new team members. So far, we have continued to grow and have remained profitable during this severe economic downturn. I think it is partly because we practice what we preach. We use our own software to manage our workforce, plan our projects and pipeline based on the same best practices we share with our customers. We use various trusted technology and marketing partners to handle peaks in our workload. We do not over-hire when times are good and then engage in mass layoffs when times are bad … As a result, we have a stable, loyal and enthusiatic team who actually loves what they do … We will do our absolute best to keep it this way.
-
-
You are currently browsing the archives for the Enterprise Software category.
Sponsored By Tenrox
