Here’s a house of cards:
And here’s a house of Lego blocks (well, sort of ..)
Here’s a house of cards:
And here’s a house of Lego blocks (well, sort of ..)
Today’s big news is that HP is dropping Siebel CRM now owned by Oracle in favor of Salesforce.com.
It’s a bit unfortunate that this is presented in the context of personal ego wars – unfortunate, but understandable, considering that Oracle has been on a warpath with HP ever since former CEO Hurd got ousted, in fact they launched a global manhunt for incoming HP CEO Leo Apotheker. But ego clashes make good stories.
That said, the real story …
Today’s example comes courtesy of TechCrunch: PayPal competitor WePay dropped a 600lbs ice block at the entrance of the Paypal developer conference. They got chased away and Moscone security removed the ice block. My question: who gets the money? Those are real dollar bills in the ice…
But don’t for a minute think it’s only at startup-land where 20-somethings rule.. the enterprise gray-hairs like pranks, too. Below are some gems from the past.
NetSuite raining on Sage‘s parade conference:
NetSuite is quite a regular at competitor conferences, see their trucks at SAP’s annual SAPPHIRE conference:
In celebrating our 40th anniversary, I’ve been given the privilege to manage the relationship between your organization and Communispond. When you have a moment, please take a look at the information below. Kindly let me know if it’s out of date, and the best way to reach you. I wish to be respectful of your time and patience.
Is your organization prepared with the communication tools and behaviors (presenting, selling, coaching, persuading, etc) to achieve greater success in 2010? I would like to hear your thoughts and ideas on any communication challenges you anticipate, and see if we can help. Please let me know if you’d be willing to meet with me – either conference call or face to face. l greatly appreciate your consideration.
What’s wrong with this email campaign? A few things… where should I even start?
Obsolete data: we all know this is a disease that plagues many (CRM) systems, but this one is extreme. The data shown on this business card never existed in such combination, but bits and pieces did. Yes, I participated in SAP’s International Consultant Training – 20 years ago, in Vienna, Austria (that’s in Europe, just in case…), so they must have picked it up from a very-very ancient resume. (It also means I understand Charlie’s joke…). Yes, I did work at SAP America, when they were a tiny outfit with 70+ employees, and the Newton Square HQ listed above was not even a dream.
Data errors do happen – but how on Earth could they dump 20-year old, pre-CRM, pre-ERP, pre-everything data into a CRM system?
Now let’s focus on content. The title, specifically. That’s the marketer’s opportunity to grab attention – or lose it. Time is money, and most of us don’t have a lot to waste – why on Earth would I want to meet a stranger without any previous contact or knowing the intent?
You just don’t send out an initial contact request asking for a purpose-less meeting.
Anyway – this email is in its well-deserved place in my Spam folder and Communispond is flagged as mindless marketers. But hey, it was good for a rant. In return, free advice to them: you don’t need Salesforce.com. It won’t help you.
Update: This post originally appeared almost a year ago . The reason I am republishing it is that so did they. They just resent the same dumb junk mail, verbatim, without the slightest change, despite my previous post and response to them. How dumb is that? Oh one more thing: through how many years can they be celebrating their 40th anniversary? (hint: it was indeed last year).
(Cross-posted @ CloudAve)
We’re just having an intense internal debate in the Enterprise Irregulars group whether SAP’s Business ByDesign (ByD) is late to the market and what it all means, when hot off the press here’s a promotional video, that’s not so much ByD advertising but a SMB / SME SaaS 101, and a very good one at that (now, that was a mouthful of acronyms).
Ironically, the video makes fun of the Big Ugly Beast, ERP – which happens to be SAP’s bread and butter. (Hey, I’ve long been saying SAP should have copied a chapter from Larry Ellison’s book, invest in a SMB Startup and let it grow independently…)
Hat tip for the video: Timo Elliot.
See our (more serious) Business ByDesign coverage here.
In my recent Suites post I said there were exactly 1.5 (one and a half) integrated full business solutions (SaaS Suite, SaaS All-In-One, SaaS ERP, SaaS SMB ERP – take your pick or create a new one) offered as a service. The one in that equation was NetSuite, and the half is SAP’s Business ByDesign.
The half is getting close to becoming full, bringing the total number of solutions to two. SAP’s ByD, originally launched in 2007 was a functionally rich solution already at launch – in fact I called it the most complete SaaS Suite not available customers. And therein lies the rub. Functionally rich, but a phantom product that only a few selected early customers could get their hands on. And it wasn’t simply a marketing / segmentation blunder as some analyst thought, it was all about architecture: SAP missed out on the economics of multi-tenancy, and realized they could not profitably operate and scale what they referred to as “mega-tenancy” – so they went back re-architecting ByDesign.
The lost 2 1/2 years were a gift to competitor NetSuite, and they milked it every possible way. SAP announced entry to the SaaS SMB space validated their market, and their own delay was an open invitation to NetSuite. As CEO Zach Nelson said at their recent earnings conference:
I’d like to thank SAP for being our IBM.
NetSuite never shied away from aggressive marketing (I guess that’s the Oracle blood in their veins), starting from pranks like the SAP for the Rest of Us Party during SAPPHIRE 2006 to staging a shootout at the anti-SAP Conference or releasing edgy videos a’la Mac vs Windows. But the biggest coup, one with definite gains was the Business ByNetsuite program which we covered here:
The aptly named Business ByNetsuite program guarantees at least 50% savings to current SAP R/3 customers relative to – watch this! – the annual maintenance fees they are now paying to SAP. Yes, it’s not a price-to-price comparison. With the perpetual licence model customers pay upfront, but are still forced to pay annual maintenance fees – with SaaS there is only a subscription fee, and now NetSuite proves it can be half of only the maintenance component of traditional software’s TCO.
Yes, NetSuite took deals from SAP and of course amidst all the chest-thumping they did not particularly emphasize the fact that that these were often divisional deals: smaller divisions of large companies, often replacing legacy systems as a result of an acquisition with the parent company running SAP. NetSuite even developed NetSuite-to-SAP connectors for enterprise reporting, fully recognizing they won’t be replacing SAP on the corporate level.
Now of course these were relatively easy wins when NetSuite was the only game in town – and that’s about to change, as SAP is getting ready for General Availability of a new Business ByDesign in July. And SAP CEO Bill McDermott fired a few salvos over to NetSuite in his announcement, as quoted by Reuters:
McDermott said he believes Business by Design’s sales will be able to quickly surpass those of NetSuite, which last year posted $167 million in revenue.
“When Business by Design is coming at them like a 99-mile-an-hour fastball, let’s see how tough they are,” McDermott said of NetSuite.
Winning against SAP when they had no relevant SaaS offering was one thing, going up against a functionally strong product will be another. NetSuite is changing tone, comparing the two offerings, as show by this slide I received from NetSuite:
This must be the first time SAP finds themselves on the wrong side of the David vs. Goliath equation (or is it the elephant vs flea? – but who is the elephant and who is the flea in the long run?). I have an issue specifically re. the functional shootout, which was rigged at best.
As for the rest of the comparisons, a fair summary is that neither side is a newcomer. SAP is the granddaddy of business processes with 30 years of experience, but they are new to operating / scaling a cloud environment – something NetSuite has a head start on them.
I have reasons to believe (more on that in another post) ByD will not be a failure this time around, and NetSuite will have to adopt to competing with a real product vs. a phantom. It will be a healthy change, with customers now having a choice of (at least) two well integrated SaaS offerings. In the end, customers win.
(Keep an eye open for the next post on ByD and beyond…)
Recently I wrote about the evergreen Best-of-breed vs. Integrated All-in-One Suite debate again, arguing:
Call me “old school”, but I also believe in the value of having one tightly integrated system for most business needs, and I believe it’s true not only for large corporations but much smaller businesses. I don’t have CIO’s to back it up, but that’s exactly the point: I am talking about small businesses that don’t have CIO’s at all – in fact they likely don’t even have full time IT stuff ( a good reason for SaaS in the first place), so they clearly lack the bandwidth to deal with integration issues and multiple system providers.
It wasn’t just hypothetical speculation, what really prompted my post ( and hence the reference to CIOs) was a study conducted by Brian Sommer who contacted several large corporate CIOs about SaaS implementations, and found that despite improvements in technology, and easy integration by firms like Boomi, Pervasive ..etc, CIOs still prefer to buy an integrated suite of applications and deal with one vendor for most of their needs. It’s not what we think, it’s what they do – and they are the customers. Says Brian:
But, customers will do what customers want to do.
Amen. But my post attracted a detailed comment from a PR professional (a fact that took a little digging to discover):
… the Suite approach requires the business to make compromises in areas of the business, and only works if you can run your whole business on that one suite – as soon as you need some other specialist system, or acquire another operation that you need to integrate, you’re in trouble because Suites, by definition, are not designed to make integration easy…
…Force.com essentially brings cloud apps together as a Suite by offering exactly the combination of tight integration, common interface and flexibility. Many businesses can already find everything they need on the platform, even the last critical element required for a serious business system: enterprise-class finance Many companies, especially smaller ones, don’t need a full ERP suite. They need a handful of critical applications that can grow with them.
Wow… where do I even start? Perhaps by the only statement I can agree with:
Many companies, especially smaller ones, don’t need a full ERP suite. They need a handful of critical applications that can grow with them.
Yes, of course I agree. In fact I am a small business myself, and guess what, not only I don’t need ERP, I don’t even need or use a CRM system, or one for business accounting. The only lightweight business system I use is invoicing (happens to be Zoho Invoice), but frankly, I could get away without it. Yes, some small businesses will want Accounting, and Accounting only, others will need CRM and nothing else – there are many good choices for them. And yes, FinancialForce.com (which the commenter represents) is great, and we’ve given it ample coverage @ CloudAve.
But that’s where reality ends, and plain old FUD begins. There’s nothing inherent in the “Suite approach” that would prevent customization, integration with additional systems, extension by third party apps. In fact the key difference between an integrated Suite or discrete point applications is just how much of the core business they cover natively before add-ons are required.
And here’s the ultimate irony: I was reading these “ex-cathedra” statements (that’s nicer words for BS) while sitting at NetSuite’s SuiteCloud conference, that was all about working with development partners, releasing a new version of SuiteCloud, the app development and integration platform along with SuiteFlow, a graphical modeling and customization tool, and a bunch of other announcements all geared to making and maintaining a thriving partner ecosystem, that builds on the core NetSuite functionality and delivers additional value to customers.
In fact the evening before the conference, CEO Zach Nelson spent an hour busting industry myths. Now look at the slide above: he did not talk about NetSuite specifically, he was advocating Cloud Computing / SaaS in general. That’s the somewhat usual formula: myth spread by defenders of the “old model” busted by the innovators – who would have expected the old-time FUD served up by a PR flak for another SaaS provider…
At the conference itself I saw several customers presentations, like that of Campus Villages which replaced 38 instances of MYOB + Intuit MRI with NetSuite OneWorld, including extensions like Nolan Fixed Assets and Electronic Payments, Celigo Smartclient, and are currently evaluating Adaptive Planning. Those are functions not provided by NetSuite, so guess what – they add third party apps, just like they would to Coda or any other system.
The key criteria for any software company trying to penetrate the SMB market will be vertical industry epxerience, and NetSuite has clearly stated their industry experience is Software and Services – everything else is open to the ecosystem. Case in point is manufacturing:
Suites are not customizable? Just look at Rootstock, a third-party developer house that created an entire MRP system on the SuiteCloud platform. If that’s not living proof of the system’s expandability, then I don’t know what is…
A key difference between the Force.com / Appexchange and NetSuite / SuiteCloud approach is that the former facilitates the creation of any product / utility that you can pick up from a marketplace, while programs developed on SuiteCloude all tie into the NetSuite system very closely – not only on the data but also on the UI level – i.e. the additional business functionality becomes available within the NetSuite UI. In other words they run so smoothly, the fact that parts of the system were written by a 3rd party is hardly transparent to the end user – which is just the way it should be.
So in the end, there is no hard rule that says Suites are inflexible, non-expandable: there only well-written and poorly written Suites, just like well-written and poorly-written point applications. There will be businesses who only need a few point apps, and should not think of a Suite, and others who will benefit from the All-in-One approach. It’s their choice. What they need is honest information, not FUD.
You’ve seen the Great Plains version, and I’ve told you to wait for the SAP version…. here we go:
Fun aside, SAP’s Business ByDesign is coming… (most likely) … in the second half of the year. I can’t wait to see a SAP video:-)