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WebEx Connect to Compete with AppExchange

Posted on September 26, 2006 ·

WebEx has traditionally been known for its Web-conferencing, but it clearly aims to be more: they just announced their own   “AppExchange” labeled WebEx Connect: a collaborative platform to combine WebEx’s own strengths in web-conferencing, IM, document sharing  …etc. with applications from their ecosystem partners, which initially include BMC, Business Objects, Genius, MindJet, NetSuite, SoonR, SugarCRM and Zoho.

Clearly, the partner-list is not (yet) comparable to the AppExchange, but this is really a pre-launch announcement, largely aimed at soliciting more ISV’s – by the time of the anticipated availability at Q1 2007 there should be a lively ecosystem around WebEx Connect as the collaboration and workflow engine. 

Talk about engine, it’s based on technology from Cordys, a BPM/SOA platform company founded by none other but Jan Baan whose ERP company gave SAP a run for their money in the 90’s, especially in manufacturing.  Business Process, Workflow expertise from Baan + Collaboration from WebEx = sounds like a promising marriage to me.

Why WebEx?   There is a simple answer… actually there are 2 million answers – that is the number of WebEx’s current user base, becoming available to partner ISV’s.   That’s about 4 times Salesforce.com’s reach.

It’s probably a low-risk speculation that we’ll see more of these “ecosystems” emerge, as  application companies strive to reposition themselves as platforms.   Eventually AppExchange won’t become *the* platform and neither will Webex Connect – they will be one of several platforms, with ISV’s supporting several of them, collaborating here, competing there.   Back-scratching some, back-stabbing some…

If you’d like to know more, the best chance to meet most of the above mentioned companies is at the Office 2.0 Conference.

 

Update: Related posts below.

 

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Filed Under: Business, Collaboration, Enterprise Software, ERP / CRM, SaaS, Software, Startups, Technology ·
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Your Neighborhood Bank Becomes Your Trusted SaaS Provider

Posted on September 8, 2006 ·

If you’re like me, you haven’t talked to a bank teller for years, in fact haven’t set foot inside a branch for a long time. Why should you? You do all your banking online. (?) But you probably wouldn’t think of your bank as *The* Software as a Service provider to run your entire small business…

That’s exactly what Fokus bank pulled off in Norway, in cooperation with 24SevenOffice and Bluegarden. The new, innovative bundle is probably the first of its kind in the World: single sign-on Web solution for your banking and all other business software needs. (hat tip: Espen Antonsen)

Let me reiterate: it’s not just online banking, but a full hosted business system. Given all the trouble I had just getting Quicken / Microsoft Money to work with several major US banks, I have a hard time imagining them come forward with such revolutionary offering. Key benefits to:

  • Customers
    • Trust, security. SaaS is not as widely accepted in Europe as in the US, and certainly the key issue is that flexible new products come from lesser known smaller providers, which SMB’s see as a major risk. Having the bank manage your data is a reassuring solution.
  • The Bank
    • Customer retention, in fact competitive advantage to attract businesses away from other banks. In a world when it’s easy to switch banks for the sake of higher interest, Fokus will have a virtual lock on its customers: that of convenience.
  • 24SevenOffice
    • Access to Fokus banks 200,000 customers; prospectively using it as a vehicle to penetrate the Danish Market since Fokus is owned by Danske Bank. Marketing/PR value of launching a “World First”

This is not the first innovative deal coming from 24SevenOffice: previously they teamed up with Telenor, a leading Scandinavian telco to create a 3G “Mobile Office“.

I’ve been following 24SevenOffice for quite a while (and have received occasional updates from Staale Risa, COO), largely due to my obsession with “Enterprise” functionality to small businesses. I can count on a single hand (two fingers?) the number of All-in-One SaaS providers with comparable breadth of functionality: CRM + ERP + Office .

My only wish is that the company entered the US market sooner. Recently they launched an International version, accessible to US customers, but frankly, that’s about the one thing coming from 24SevenOffice that I am unimpressed with. It removes the key value proposition of being a full-rounded, integrated solution ( a’la NetSuite but more) and positions the system as a lower-cost CRM competing head-on with SalesForce.com. Well, I have news for my European friends: this version does not compete with Salesforce, but with the dozens of other challengers. Personally, I think it’s a marketing blunder.

That said I know the company is working on porting their full system (think accounting, HR ..etc) to US requirements and a full blown US launch is in the works …. stay tuned.

Update (9/8): To access the full 24SevenOffice site, trick the system by selecting a European country, e.g. the UK. You still have to do some digging, a lot of logistic functions are hidden under Financials.
There’s also a neat demo here.


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Enterprise Software is (Still) Not Dead

Posted on August 18, 2006 ·

Recently I joined my fellow Irregulars (a work-group of bloggers, analysts, journalists who write about Enterprise Software) in jointly publishing an article on Sandhill: Software’s Sky is Not Falling.
All articles get edited, and that’s even more so with multi-author ones; therefore I thought I would post my original, pre-edit piece below.

 

With almost predictable regularity we’re seeing software obituaries popping up just about every month: the only variation in the theme is what’s being declared dead: sometimes it’s Enterprise Software, sometimes it’s email.  Just like I’ve already stated I did not believe email was dead, I strongly disagree it’s time to mourn Enterprise Software.

Since my fellow Irregulars mostly addressed the Open Source angle in Guy Smith’s post, Is Enterprise Software Doomed? I’ll reflect on the SaaS part of his piece.

“SaaS is the bastard child of the traditional proprietary software vendor and the Open Source marketing paradigm.”

SaaS is NOT an offspring of Open Source, although they often get lumped together, especially in buzzword-heavy startup pitches; however, they are quite different animals.

With a great deal of simplification the single most important difference is in the deployment model, SaaS by definition being on-demand, while most Open Source products are on-premise, traditionally installed systems.

Guy sees the natural evolution of Open Source Enterprise Software vendors “retrofitting” their products to SaaS offerings, but in reality most SaaS offerings are commercial, and most Open Source is on-premise, these two being on decidedly different paths.

The common trait, as Guy correctly points out is the change in the sales & marketing process: PR, buzz, online sales cycle process management, free trials, inbound sales, customer-initiated pull process vs. sales push. Yet Guy sees this as a necessity forced by economics: “the reduction in unit revenue will force all Open Source (including Dual Source) vendors to change their marketing and sales cycle “ when in reality these are actively pursued changes that both Open Source and SaaS companies embrace. Without denying the importance of the underlying technology, the most important change SaaS facilitates is this very business model change, which opens up entirely new, unpenetrated business segments for Enterprise Software: small and medium businesses (not just the M but the S in SMB). In fact customer size is another differentiation factor, at least for now, SaaS penetrating the SMB segment, while Open Source is ideal for mid-size companies, that actually have the in-house IT-expertise to play around with OS.

So is it as simple as:

  • small business = SaaS
  • midsize = Open Source
  • large company = traditional software?

Not really, that would be oversimplification. But while it’s easy to declare that for small businesses without their own IT resources there is no better option than SaaS, there is no clear “winner” for large corporations. There shouldn’t be. This is not religion; it should be business decisions that these organizations have to make individually. Analysts fighting the SaaS vs. On-premise war often forget that software exist to resolve business problems. As Charles so eloquently points out, it’s the complexity of these business processes, the need for customization, the number of user seats..etc that matters, and as we move up on this scale, increasingly “traditional” Enterprise Software is the answer. I happen to believe that eventually SaaS will grow up to meet those requirements, but am not going to guess how many years it will take. In the meantime the SaaS-fans (admittedly I am one) can claim that SaaS is the future – but that does not mean Enterprise Software is dead.

If I were to launch a software startup, it would be SaaS. Dave Duffield and his PeopleSoft team have the luxury of starting from scratch launching Workday, a pure SaaS company – since they were forced to walk from PeopleSoft and it’s customer base. But SAP and Oracle, (btw, Guy, since when do we determine market leadership by the amount spent on acquisitions?) together “own” the large corporate space; how could they expect their customers to throw away their investment in traditional software?
On-demand “purists” (the religious types) criticize SAP for their half-hearted hybrid approach to SaaS –  but why would they do anything else?    After all, SaaS is still only 10% of all enterprise software sold. Even if we believe “the future is SaaS” (which is of course unproven, but I happen to believe in it), there is a lot of mileage left in the “old” Enterprise model, and market leaders like SAP have certainly no reason to turn their backs to their huge and profitable customer base.

 

Here are the other “Irregulars” un-edited contributions:

 

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Filed Under: Business, Enterprise Software, ERP / CRM, Open Source, SaaS, SMB / SME, Software, Technology · Tagged:
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SAP Duet Video

Posted on July 5, 2006 ·

Having seen it at SAPPHIRE 06, I wrote about the importance of Duet for both SAP and Microsoft: “Duet’s importance by far exceeds what the limited number of currently available scenarios might imply: for SAP it means potentially tripling / quadrapling their user base, even if indirectly, and for Microsoft it’s another way to lock users into their Office suite.”

Jason Wood posted an insightful, analytical article on his blog with screenprints and all the bells and whistles.

Now there is an online video showing several scenarios. Use the pull-down menu to select the different tracks available.

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Google is so Generous to me

Posted on June 12, 2006 ·

I have no clue how on earth my little post became the second hit Google brings up on a “Duet SAP” search, but I am certainly not complaining. The first one is Microsoft, then comes yours truly, followed by the Gartner group (hey, InformationWeek was right, after all!) and only then comes SAP itself.

Keep up the good work, Google, I like it.

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Filed Under: Blogging, Enterprise Software, ERP / CRM, Marketing / PR ·
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SaaS: Evolution or Revolution

Posted on June 6, 2006 ·

Blog-Based Analysts Shake Up IT Research – says InformationWeek. Well, I don’t know about shaking up, but I repeatedly find myself having to disagree with respected research firms.

First there was McKinsey, where I had to disagree with their assertion that financial applications will not see SaaS penetration for years to come. The ensuing discussion on several blogs, as well as statements by relevant software companies sufficiently buried that assertion.

Along comes Gartner with their Gartner Voice podcast. Not particularly exciting, I doubt you’ll hear anything new, but if you have 11 minutes to kill, why not download it.
“Right now [Saas] is a very small part of the marketplace. It only takes up…one-half of one-percent of overall enterprise applications. If you look out eight or ten years, that might go up all the way to 30%.”

While the first number is probably valid, comparing a new model to the legacy installed base says nothing about the health of the Software as a Service industry. Currently about 10% of all software sold is SaaS, and that ratio is expected to grow aggressively. There will not be wholesale migration from legacy systems, but withing years with SaaS gaining dominance in terms of new deals, hybrid environments will evolve, which eventually will tip the scale over. Gartner expects SaaS to reach 30% in 8-10 years? It took less for client-server to completely push out mainframe applications. And yes, dinosaurs do exist: at SAPPHIRE 06 SAP mentioned they still have 3-4 mainframe customers.

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Filed Under: Enterprise Software, ERP / CRM, SaaS, Software ·
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Web 2.0 in the Enterprise – Round …n.. (I can’t keep track)

Posted on May 26, 2006 ·

Stowe Boyd picks up where Ben Metcalfe left off in Web 2.0 doesn’t work in the mothership, but… essentially recommending that Web 2.0 is best introduced in the Enterprise “in a satellite operation at arms length from the rest of your operation”

While this is often the easy solution, I think a case can be made for the seamless mashup of process- and workflow-centric enterprise applications and the more creative, unstructured, collaborative tools like wikis.  Case in point is JotSpot’s integration with Salesforce.com based on the Appexhange. Granted their target is not the largest of enterprises, but another example I heard of at SAP’s annual conference is the SAP Help Desk wiki by  Socialtext targeting the entire SAP ecosystem.  In any case, I agree that spontaneous, project-focused use is how wikis will become adopted in the Enterprise, but at the same time I believe they should be a logical extension of any Enterprise system – SAP, Salesforce.com are starting to recognize, and I think the day when we’ll have both top-down (enterprise sale as part of the large package) and bottom-up (departmental initiative) penetration is not that far.

But then Stowe goes one step further, and this is where the trouble starts:

“…the larger question — whether the enterprise would be more agile, more adaptive, and more of a survivor is it could somehow break away from the need for slow-to-change applications that span the needs of many departments, beholden to many but satisfying none — has not really been addressed by Ben or the others I am interviewing on the on ramp to CTC 2006….
My gut says yes. Enterprises would be better off if their IT departments could move to small, low cost, web-based apps that satisfy local needs — a project group, one campus in Denver, the marketing department in Japan — without having to subordinate local needs to corporate controls. The benefits of enterprise standardization are measured in the IT budget, but the true costs are distributed thoughout the enterprise: less collaboration in the research team leads to slower innovation, a less-thatn-intuitive UI for the sale staff in France leads to lowered sale numbers, and a heavyweight finance solution that slows down invoicing costs serious bank in collection time.”

Oh, boy. When we’re talking about large multinational corporations, as Stowe does in his example, the primary benefit of standardization and integration is NOT measured in the IT budget. The key benefit is competitiveness, simply being able to conduct business.  Here’s a case study from my “previous life” when I was implementing SAP systems in exactly these types of companies: The Client, a major test and measurement equipment manufacturer had no real-time visibility of their available-to-promise inventory throughout their own plants accross the US and several countries in Asia and Europe.  It typically took them 3 weeks to be able to promise a delivery date to customers. Needless to stay they started to lose business. After the SAP implementation customers could receive the promised delivery date in real-time. For this company the implementation of the standard system was not an option, or driven by IT savings, it was the only way to stay in business.

As a matter of fact, prior to standardizing on SAP the individual plants operated exactly according to Stowe’s ideal model: each doing whatever they wanted, picking their own systems that simply did not talk to each other.

Web 2.0, collaboration is great, it has it’s place in the Enterprise, but so do those “ugly complex” transactional systems.  Don’t try to run your supply chain on a wiki

Update , more than three years later: Would You Manage CRM with a Wiki?

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JotSpot Marries Salesforce

Posted on May 24, 2006 ·

In late 2004 I implemented JotSpot and NetSuite about the same time. The wiki project was a few weeks ahead, and within days of starting with NetSuite it became clear that there are potential areas of overlap between the two. For example we had already started to maintain competitor-, trade association info on the Jot wiki, also managed our marketing and sales collateral there (version control is a lifesaver), and all of a sudden we realized there is a more structured home for this information within NetSuite.

So early on we had to make decisions on what information should live in the wiki or the CRM system, and we took care of the “integration” by cross-linking such pages. As rudimentary this approach was, it worked well, and both being hosted applications we could surf back-and-forth seamlessly .

The experience was an eye-opener to me: all businesses have a need for both structured and unstructured (OK, semi-structured) data management, collaboration, and this means a potentially huge channel for the wiki guys: their product should be a natural extension of all Enterprise Applications (ERP, CRM, Accounting …etc).
These are seemingly two different worlds: traditional enterprise software is process-driven, while the wiki guys consider process dead, it’s all about freewheeling, creative collaboration of independent minds. Well, businesses need both.

Back then we were Jot’s first corporate customers, so I had direct channels to Joe, and recommended him to team up with the likes of NetSuite, Salesforce ..etc. The idea was not a winner, they were busy building their word-of-mouth, bottom-up, quick-signup pipeline, and Enterprise Software appeared to be a strangely different world.
I’m glad to see they have come around, as expressed in Joe’s excellent writeup, as well as their partnering with Salesforce.com. Congratulations!

And to the rest of the Enterprise Software world (my old world): you guys ALL need a wiki.

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Filed Under: Collaboration, ERP / CRM, SaaS ·
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How SAP Ended up Promoting NetSuite

Posted on May 22, 2006 ·

NetSuite, the provider of perhaps the best hosted integrated software solution for the SMB market tried to rain on SAP’s parade during SAPPHIRE 06 in Orlando. They planned to host a cocktail party in a hotel suite right across the Convention Center. The party’s theme was “SAP for the rest of us” and the email invitation posed a question/answer: “Who will become the SAP for the midmarket? (It Ain’t SAP),” Cute.

Of course SAP got p***ed and enforced it’s contractual right to cancel competitive events in any of the SAPPHIRE venues. SAP’s Spokesman Bill Wohl called NetSuite’s move “guerilla marketing“.

Now, what’s wrong with Guerilla Marketing? It’s fun … if you have humor to appreciate it. Last week SAP didn’t. The result? NetSuite CEO Zach Nelson laughed off the “loss” and will hold a web-conference instead. This being a juicy story of course it got picked up in the media and quite a few blogs – the media blitz lasted a few days, then will start again around the web-conference … so basically SAP’s decision to kill the party provided NetSuite with a fair amount of publicity – exactly what it needs as it ramps up for its IPO planned later this year. Zach should send a thank-you note to SAP.

Here’s what I think SAP should have done: let it happen, and set up their own counter-party. Had it been allowed to proceed it would have been a noon-event. Not that NetSuite is a negligible company, in fact they have an excellent product. Some say Salesforce.com is just a glorified contact manager relative to NetSuite, and I tend to agree. (I put my money where my mouth is: in my last corporate job I became a NetSuite customer, after careful comparison to Salesforce). That said, NetSuite is targeting strictly the SMB market, in fact more the “S” than the “M”, while SAP despite all their SMB initiatives is still largely the Enterprise Company – SMB is just not their sweet spot. SAP had their own SMB people in Orlando (I interviewed Gadi Shamia, SVP for SMB Solutions, and intend to write about it soon) – they should have set up their own party right next to NetSuite, and present SAP’s vision for that market segment. In fact they could have embraced the NetSuite event (steal their show) and make up SAP logo’d signs pointing to both events.

The impact of the NetSuite party, especially in an environment where most participants are already biased towards SAP would have been minimal. In fact NetSuite had more to gain from the cancellation and the resulting media blitz then actually proceeding with the party … so much so, that I wonder if NetSuite intentionally leaked the news to SAP – a brilliant PR coup, if you ask me.

Related Posts:

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SAP Without SAP – Duet

Posted on May 21, 2006 ·

(Updated)
More than a decade ago as Project Manager implementing SAP solutions I could not understand why the Client’s PM showed absolutely no interest in getting SAP-trained, or even attempting to log on to the SAP system. The only software product he ever touched was email. Years passed, and as I climbed the ladder, I found myself in a similar situation: locked in to Office products most of the time – just like millions of corporate employees whose daily life does not involve actively conducting transactions in their Enterprise system (SAP). They need to occasionally review/approve an item or react to an exception alert though. They are the (often management-level) employees who will not directly use SAP, even though timely access to SAP data is critical to their decision-making process – or to somebody else’s daily job.

Thanks to Duet they can now have the SAP data at their fingerprints without touching SAP itself. The long-awaited (and often promised ) SAP-Microsoft Office integration has finally arrived.

What was announced at last years’s SAPPHIRE in Europe as the Mendocino Project became a product, the second preview of which was released a week before SAPPHIRE 06 under the name Duet. Considering Microsoft’s role, just having a friendly name is a major achievement itself – it could have been something as friendly as Microsoft Office Extension to mySAP ERP 2004, Enterprise Version, Release 1.0. (read Microsoft Uber-Blogger Robert Scoble on product naming…)

I’ve seen a presentation of some of the current features as well as the roadmap for the next year, and also had a chance to sit down with Dennis Moore, GM of Emerging Solutions, who provided the blogger group with additonal insight.

Currently Duet (which is a boxed product) supports MS Office 2003 and mySAP ERP 2004, and there are 4 business scenarios available:

  • Leave Management
  • Time Management
  • Organization Management
  • Budget Monitoring

The final release is due in June 06 and will soon be followed by two value packs.

Value Pack 1 is due in Q3 06, new scenarios will include recruitment and travel management, enhanced analytics and support for mySAP ERP 2005, the current platform which, per Shai Aggassi will stay for years to come.

Value Pack 2 is expected in Q4 06 with some line of business functionality becoming available, e.g. Sales contacts, activity, Purchasing. MS Office 2007 will be supported.

It’s important to clarify that Office will not become the primary user interface of the “transactional worker”, i.e. you will not be creating product masters, running a shop-floor, etc. What Duet is, is a natural fit for a workflow (think of roles, limits ..etc) -based processing of messages and underlying data triggered by events, rules and exceptions.

Duet’s importance by far exceeds what the limited number of currently available scenarios might imply: for SAP it means potentially tripling / quadrapling their user base, even if indirectly, and for Microsoft it’s another way to lock users into their Office suite.
Duet is a step in SAP’s declared strategy of opening up access to their data and processes via a number of user interfaces, including Office, Portal, Mobile devices ..etc. It also fits in the “Sap Simplified” philosophy of owning the Business Processes and letting go of the user experience.

I tend to disagree with AMR’s concern on the large number of prerequisites: mySAP ERP 2004 or 2005, MS Office, Exchange server, and specific applications for some scenarios, e.g. E-Recruiting 6.0 for Recruitment Management, mySAP SRM 5.0 for purchasing management and CRM 4.0 for sales activity management. Yes, these are prerequisites, but the point is that even though Duet is a boxed shrink-wrapped (thanks for the comment!) product (I’ve seen a white box at SAPPHIRE, whether real or mock-up), it is not expected to sell as a standalone product on it’s own merits. It will expand access to additional users within corporate customers already using both SAP and Microsoft products, i.e. likely to already have the prerequisites.

Talk about prerequisites, pricing for Duet, and specifically the underlying SAP access will be an interesting challenge, since SAP’s model is typically charging $$$$ a smaller user base, while MS relies on $ from a large number of users – there has to be a model in between.

Not everyone in Microsoft welcomes Duet: the folks at MS Dynamics are clearly unhappy. They even produced a so-called White Paper comparing Duet to their own solution, Snap. “So-called”, because it does not even attempt to be unbiased. It praises Dynamics and Snap, while listing the dry facts about Duet, completely forgetting the fact that as Enterprise systems Dynamics and SAP are really apples and oranges… or I should say Ford vs. Rolls Royce.

IBM isn’t sleeping either: IBM to sing in Harmony with SAP to match Duet. IBM’s Harmony, which I haven’t had a chance to see, claims to play a similar role with Lotus Notes. It clearly is a competitive product, as far as Duet (which is jointly owned by MS and SAP) is concerned – but from SAP’s point of view, it’s just one more user interface, exposing more knowledge workers to SAP. The more the merrier.

Related blog posts:

Update (5/23) : Fellow SAPPHIRE blogger and SAP/MSFT investor Jason Wood posted a very detailed, thorough analysis on his blog – with screen prints and all the bells and whistles. Oh, and Jason – here’s my pick for a famous duo whose duet (pun intended) had an impact on the world. Update (5/30): Here’s an entire new blog dedicated to Duet (well, actually discussing Duet while promoting a 3rd-party solution). Thanks, Vinnie for pointing it out.

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