Business Analytics

Host Analytics: Where Planning and Performance Management Meet

Today we live in a new world where the Internet levels the playing field for small, mid-size and large enterprises, breaking down barriers to entering new emerging markets. And yet we also face new challenges with rapidly changing commodity prices, fluctuating exchange and interest rates and an accelerating pace of business across a global economy. Whether you are looking to grow and expand or just accelerate profits, you need a plan.

A recent Mint Jutras report posed the question: Is Planning & Performance Management a Marriage Made In Heaven? We concluded that having a comprehensive plan is the first step towards achieving any specific outcome. But to optimize growth and profits, that plan needs to be a living plan, capable of evolving as goals and business conditions change. The key to breathing life into your plan is to actively link it to enterprise performance management. While that might seem intuitively obvious, too often the plan simply goes on the shelf as you go about business as usual. To monitor, manage and predict performance against the plan, you need to marry the right solutions with the right data.

The tools available to help you succeed range from spreadsheets to suites of applications that also might range from simple, basic tools to comprehensive solutions built on modern, enabling technology. Host Analytics provides a comprehensive Enterprise Performance Management (EPM) platform that is simple and affordable enough for the small to mid-size enterprise, but comprehensive and robust enough to support a growing mid-size company as it transforms itself into a large enterprise. Delivering its solution exclusively as Software as a Service (SaaS), Host prides itself in offering an EPM solution you can’t outgrow.

The Right Mix

In our report, Is Planning & Performance Management a Marriage Made In Heaven? we found companies with World Class implementations use a more extensive set of tools to plan, monitor and manage performance (Figure 1). The tools shown in the figure below fall into four general categories: specific applications, reporting, analytics, and, of course, the ubiquitous spreadsheet. Host Analytics provides the first three as part of a comprehensive suite and also helps you control the inevitable use of spreadsheets.

Figure 1: Tools To Monitor, Plan and Predict Corporate Performance

Host Figure 1Source: Mint Jutras 2016 Enterprise Solution Study

Note that Mint defines “World Class” in terms of the performance of the implementation of enterprise software that runs the business. Survey responses are used to measure cost savings and other improvements since implementation, progress made in achieving goals and selected current performance metrics that can apply universally to any business. The top 15% in performance is categorized as “World Class” and the remaining 85% are referred to as “All Others.”

While its solution is quite comprehensive today, being a cloud-only solution allows Host Analytics to offer frequent enhancements and improvements through monthly maintenance releases and quarterly feature releases. Over the past year Host Analytics has delivered about 185 enhancements and announced some very strategic partnerships. Key investment areas include:

  • User Experience
  • Performance
  • Consolidation
  • Data integration
  • Planning
  • Modeling
  • Productivity
  • Analytics
  • Security

“We Speak Finance, not Klingon”

According to Dave Kellogg, Host Analytics’ CEO, “Our first language is finance.” Hence the applications delivered serve the office of finance. He goes on to clarify with, “We speak finance, not Klingon.” That tongue in cheek reference to the language of the alien culture encountered in the journey of the USS Enterprise (of Star Trek fame) is a subtle reference to competitors who speak only in the language of information technology (IT), which will mean little to the finance department.

As an interesting side note, the Klingons appeared in the original Star Trek series as enemies of the Starfleet Federation, but became allies in later generations of the entertainment franchise. We can only assume Mr. Kellogg is referring to Klingon in those later series because Host Analytics is actually quite IT-friendly, building on a modern technology foundation. Certainly IT is not viewed as the enemy, even if the staff does speak a different language.

However, Mr. Kellogg goes on to point out that while those in the office of finance might speak finance, they don’t care exclusively about finance. They care about the performance of all departments and disciplines across the enterprise. This is an important factor, and one covered in depth in our prior report. You need more than a financial plan. You also need an operational plan. This could potentially present a problem to a solution provider focused exclusively on the office of finance, which is why it weighs heavily in determining Host Analytics’ strategic approach to its product portfolio.

Focus, Partner and Unite

Mr. Kellogg described the company’s strategic approach at the recent Host Analytics World 2016. “We have three options to choose from. As a solution provider we could ignore the problem. But that would most likely mean the plan would be retired to a drawer and used only for executive compensation purposes. We could go a mile wide and an inch deep, attempting to build functional performance management applications for all functions. Or we could focus, partner and unite.”

Host Analytics chooses the third option, focusing on building financial apps and partnering with other companies that speak the languages of supply chain, manufacturing, services, marketing, sales, etc. Key to that decision: Host allows partners to build these apps within its Modeling Cloud. When they do, Host can bring the financial plan together with the full operational plan in a single cloud model. In doing so, Host is hoping to eliminate the need for “shadow finance” organizations that tend to spring up across the enterprise when departmental and functional needs aren’t met by a financial (only) plan.

Planning modules within the suite allow you to plan, budget, forecast and report all from one application. Modeling helps you create operational plans that align with financial plans. Multidimensional modeling helps you anticipate outcomes using financial and non-financial drivers. New dimensions can be added for granular “what if?” scenarios.

Analytics Tie It All Together: Think Quick and Qlik

Analytics are important tools in bringing the financial and operational plan together. In our prior report we noted that World Class implementations were 43% to 180% more likely to use various types of analytics.

Host Analytics has had a long-standing relationship with Qlik, who is also its customer. That relationship has now been strengthened and Qlik is embedded within the Host Analytics suite. No more exports from Host to Qlik required. Access and data is available in real time right from Host.

This partnership and integration brings data discovery and visualization tools to the Host Analytics suite. Pre-built dashboards can be easily tailored and configured by business users, adding a level of self-service and independence for the business user without over-reliance on IT. Presentation quality story boards can be created and integrated with Host’s Financial Package Publisher. The (combined) solution becomes browser agnostic (Windows and Mac), and fully supports mobile devices.

Direct integration with Host financial data comes right out of the box, but customers and partners will also be able to integrate other models and third party applications in order to mash up data from a variety of sources. Host has also expanded in-memory support and implemented incremental updates of data cubes and dashboards. Early results have yielded 50% to 90% improvements in performance across various planning and reporting scenarios.

Expanding the Circle: Workforce Planning & Analytics

While Host Analytics’ primary focus is on financials, it is not drawing a circle too tightly around finance. In fact it is expanding its boundaries to include an element of workforce management, including the delivery of workforce planning and analytics. Workforce planning is a logical extension of the financial plan since headcount determination and resulting costs are often included as part of the financial plan. The new analytics will provide improved visibility to headcount, compensation, benefits, open requisitions and other employee detail. But for more specific planning activities, such as incentive compensation planning, Host has chosen a partner that speaks that language. A partnership and integration with Xactly was also announced at Host Analytics World 2016.

How Does Host Analytics Stack Up?

We concluded our prior report with a checklist of sorts to be used in looking for a solution that effectively manages planning and performance management. So how does Host Analytics stack up?

  • Look for planning and performance management tools that complement each other. While Host positions itself as an EPM player, its planning and modeling capabilities are a good fit for many companies, particularly in the small to mid-size range. While the volumes very large enterprises must deal with might have over-taxed its solution in the past, the new in-memory capabilities might just address that.
  • Make sure you can connect your overall financial plan to your operational plan. Host Analytics focuses on the financial plan, but has recently expanded to include workforce planning. Partners are required for other operational plans, but the partnership and integration with Qlik should help bring it all together in the end, provided the necessary operational plans are available. Expect some setup work to be required if bringing together data from applications in third party applications, but those offered by certified Host partners should slide in more easily.
  • Select tools that encourage rather than prohibit collaboration. Host Analytics has embedded social collaboration with in-context discussion threads and activity streams and the ability to annotate a plan. Host has partnered with SocialCast, but also supports integration with other collaboration tools such as Slack and Yammer. In addition, new “reporting” capabilities also support export to Google Sheets and Google Drive and Host will continue to build out this integration for bi-directional updates.
  • Consider a cloud approach. Host Analytics’ solution is delivered entirely and exclusively as Software as a Service (SaaS).
  • Evaluate not only the traditional desktop/laptop user interface but also the overall user experience, including the ability to support the mobile executive, on the device(s) of choice. Ask for a demo to evaluate the overall User Experience. Host is browser agnostic and adapts well to various devices.
  • Look for solutions that play well with others. Host has designed its solution with this in mind. But don’t be afraid to ask for specifics on your own configuration of solutions.
  • Work with your information technology (IT) staff, but seek a level of independence in the planning and performance management process itself. Think of your most complex test case for planning/modeling. For example, do you need driver-based planning? Host Analytics supports it. But does Host support all the methods and/or algorithms you might need? Make sure you ask. With the embedding of Qlik, data discovery and visualization took a giant leap forward, but always ask for a test drive. It’s one thing to watch an expert make the software sing and dance. How does it look and feel and how flexible is it when you are in the driver’s seat?
  • Understand clearly what kind of reporting and analytics are available right out of the box. Same as above: look at the demo but the proof of tailor-ability is in doing. Again, ask for a test drive.
  • How much data can the solutions handle? How fast can they process it? Host now supports SQL Server 14, which provides new in-memory capabilities. In addition, Qlik dashboards preload all data needed into memory. This combined with the ability to incrementally update reporting cubes and dashboards provides good support for high speed, real-time access to data.

Conclusion

Host Analytics’ claim to be a leader in cloud-based enterprise performance management (EPM) is valid. Its platform of financial applications for modeling, planning, consolidation, reporting and analytics effectively marry the planning and performance management activities in companies from small to large. While Host “speaks finance” it has also created a platform on which partners that speak other functional languages (supply chain, sales, marketing, etc.) can add their own value. Together with those partners, along with its special partnership with Qlik, the happy couple expands to become a true blended family.

If your current financial plan sits in a drawer for the majority of the year…

If you can’t align your financial plans with your operational plans…

If you are struggling to make sense out of a collection of spreadsheets…

If you find yourself in fear of mistakes buried in those spreadsheets leading to bad decisions…

You owe it to yourself to look for a new solution that can help you plan, monitor and manage your performance. But of course, only if you want to maximize your opportunity to optimize growth and profits.

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Welcome to the New World of Exact Macola

Did you ever walk purposefully into another room and forget what you came for? It happens to me all the time. My pantry is less than 20 steps from my kitchen, and yet, 9 times out of 10, I open the door, step in and wonder what I came for. I wind up stepping out, looking back into the kitchen to see what I was doing. Usually that will trigger my memory. It’s gotten worse with age, but I’m not that old. It happens to all of us. When something we need is not visible and clearly within reach, it’s easy to get distracted and lose track of what you’re looking for.

It’s bad enough when you’re puttering around the house or making dinner. It’s even worse when it happens when you’re sitting at your desk at work. You get a call or an alert on your smart phone, or something doesn’t look quite right on that report you’re scrolling through, or you’re preparing to present performance results to your boss and you need to dig a little deeper. You have a question in mind but even though you know the answer is buried someplace in your enterprise data, it’s not immediately visible and clearly within reach. If you have to hunt and peck, traversing a series of menus, to find what you’re looking for, it’s easy to be distracted along the way. Sometimes you wind up going down a rat hole and 2 hours later, you realize you still haven’t answered your own question. No wonder the days just seem to get longer and longer.

This is clearly the problem Exact Macola is trying to solve in its newest version of Workspaces. A Workspace in Exact Macola 10 gathers together all the data you might need to perform a process, make a decision or monitor performance… in other words, to do your job. Some will come right out of the box. But because your role in your organization and your job is unique, new Workspaces must be easily constructed and standard Workspaces must be easily tailored.

Exact Macola describes Workspaces as “one of the most unique and powerful pieces of Exact Macola 10 – allowing personalized role-based views of your business information and creating a natural and intuitive experience.” I came into the Exact Macola Evolve conference last year with a pretty favorable impression of this technology and that impression became even more favorable as I watched the “Dueling Developers” session this year, which pitted a senior consultant (Thijs Verberne) against product manager David Dozer, in creating Workspaces on the fly as the audience watched.

That exercise proved development was fast and easy. But how does this keep users from wandering into the pantry and forgetting what they came in for? A new feature of Workspaces 2.0 is the ability to add Workspaces menus to transaction screens and/or perform transactions directly from Workspaces. Do you have a job where you spend the majority of your time in transaction screens (e.g. you’re a buyer researching and creating purchase orders)? You can stay there all day doing your primary job, but when you need to do some further investigation, (right from a transaction) you can bring up a Workspace from a pull down menu and it appears as a popup. This feature alone drew a huge round of applause from the audience.

Or maybe you are a manager that prefers to monitor status of a series of key performance indicators (think dashboard). But occasionally you need to perform a transaction like approving those purchase orders or requesting a change. You can stay in your dashboard-like Workspace, and attach a drop down menu (or 2 or 10) that allows you to divert and run a transaction without ever leaving your preferred space.

Marry these two features together and you don’t have to worry about anticipating all your needs up front. Get the basics set up and let your work naturally direct the evolution of your Workspaces. At first you might not think you would ever have a need to go directly to a transaction. But sure enough…. No problem, it can be added in minutes (really!)

While Workspaces 2.0 was (in my mind anyway) the highlight, it is not the only innovation that has been delivered by Exact Macola over the past year. Here are some other areas the team has been working on:

  • Phase 1 support for IFRS
  • Workflow conditional statements (rules, if-then statements, more control and flexibility)
  • Financial consolidation across divisions
  • Business Intelligence delivered through a partnership with Qlik, but sold by Exact under the Exact Insights brand
  • Forecast Pro integration
  • Avalara integration
  • New web services and some underlying architectural changes

All this innovation (and more to come) seemed to infuse a new energy and vibrancy into the Exact Macola community and created more urgency for those still running older solutions like Exact Progression or the Enterprise Suite (ES) to upgrade/migrate to the newer Exact Macola 10.

Not only has the Exact Macola team been delivering innovation at a much accelerated pace, it has also been responding to several trends in the market today. Beyond those features listed above, Exact Macola has been working on full web enablement and the overall user experience. In addition to Workspaces, the company has renewed its focus on ease of use, bringing in experts to help deliver a more natural user experience (UX). This includes both the access anytime, anywhere convenience of the cloud, as well as more mobility. After delivering mobile functionality on iOS last year, it added Android this year. And it has been delivering more analytics, as well as a more end-to-end integrated solution.

Indeed these are exciting times for Exact Macola and its customers. But for those still running those older solutions (Progression and ES), the excitement might soon fade, unless of course they decide to make the leap forward. I would strongly encourage them to do so.

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The Three Dimensions of SAP Business ByDesign Set The Stage for Growth Part 1

Simplicity, Flexibility, Extensibility in the Cloud

In Cloud ERP: The Great Enabler of Growth, Mint Jutras examined how Enterprise Resource Planning (ERP) solutions delivered as software as a service (SaaS) help companies fuel and simplify growth by addressing people challenges and mitigating risk, while maintaining governance and control. Cloud solutions enable you to fail (or succeed) faster, allowing you to focus on the next and best opportunity for growth. While some of the factors that enable growth are inherent in any SaaS solution, not all cloud ERP solutions are created equal. Targeting mid-size and fast growing companies, SAP claims its SAP Business ByDesign is designed specifically to help these companies grow and maximize profits. In this 3-part series of posts I’ll investigate the merit of those claims.

This is Part 1 of that 3-Part series. If you prefer to skip the suspense you can read the full report now.

SAP Business ByDesign was born in the cloud in 2007, long before “Run Simple” became the mantra of SAP. Yet the initial objective was to simplify, delivering a 100% cloud-based solution for the small to mid-size enterprise (SME), while also fully leveraging SAP’s experience and infrastructure. Instead of reworking an existing product, SAP took a “start over” approach, and over the past seven years has developed and refined a three dimensional design philosophy. Those three dimensions: simplicity, flexibility and extensibility. This philosophy is a perfect prescription for a growing company that needs to get out of the gate fast, but has not yet reached, or perhaps even determined its final destination.

In order to enable growth a solution must be broad (in terms of functionality), flexible and extensible. SAP attacks these requirements with a modern and modular architecture that was born in the cloud. It delivers a next generation user experience that continues to evolve and a business configurator that has become the gold standard within SAP, helping organizations adapt as they grow and change. And finally, it embeds reporting and analytics right in the application itself so that continual oversight and analysis does not become an afterthought.

Architecture

SAP Business ByDesign is modular by design. This should not be confused with simply being comprised of a set of modules. By definition, any ERP solution is an integrated suite of modules. It is how modules are coupled together, or in the case of SAP Business ByDesign, how they are decoupled, that makes a solution flexible or rigid. Most mid-size to large enterprises today no longer grow to be large, monolithic enterprises. They grow modularly, spawning new divisions or subsidiaries to expand to address new products, product lines or territories. But these different business units must interoperate smoothly and seamlessly, making obsolete those legacy ERP solutions that were similarly designed as rigid and monolithic.

One of the guiding principles of the design of SAP Business ByDesign is decoupling. This decoupling is delivered in a variety of ways. Business logic is decoupled from the user interface, allowing for ease of translation and also the reuse of logic and services across any number of different types of interfaces. The same transactions can be triggered whether you are using the product through a browser on a desktop, a mobile application or no user interface at all. Through process automation, sometimes the best user interface is no interface.

In addition, the software modules themselves are essentially decoupled. Instead of hard-coded logic, communication between different modules is message-based. This makes it far easier to add or swap modules and business scenarios as needed or even to consume innovation. With a rigid monolithic solution, the entire enterprise needs to march forward together, oftentimes making some departments wait for much needed enhancements because other parts of the business aren’t ready for change.

While there is a lot of value to be gained from this type of decoupling, there is one area where embedding functionality adds more than it detracts in value. If reporting and analytics are completely separate, they often become an after thought, something the implementation team never quite gets around to delivering. And even if they do, if delivered as an entirely separate function, they are often out of sight and out of mind.

Separating reporting and analytics is often required in order to preserve or improve performance, hence the emergence of solutions for online analytical processing (OLAP) separate from online transaction processing (OLTP). However, from the beginning, SAP Business ByDesign was built using an in-memory database that removes those performance issues and allowed SAP to embed analytical capabilities within the solution. In addition to bringing this analysis front and center, it also provides real time access from a wide variety of data sources, including data from sister companies or headquarters, eliminating delays and speeding decisions. The speed and capacity of in-memory also removes the need to limit the amount or granularity of data needed to help determine where and how to invest next. Instead of using aggregated summary data that might be misleading, SAP Business ByDesign users can dive into a level of detail that would be unmanageable and unimaginable using legacy architectures.

Up Next…

In the next post (Part 2), we’ll take a look at what SAP has done with the user experience and configuration of SAP Business ByDesign.

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Impressions from SAP Americas Partner Summit: Partners Make it Real

Tis the season for partner summits. SAP Americas Partner Summit was the 3rd of these I attended in a week and a half. This was the first of this type of event for SAP since it recently merged North America and Latin America into a single unit under the direction of Rodolpho Cardenuto, President SAP Americas. This merging of the Americas bucks the trend in the industry. As Latin American economies, most particularly Brazil, continue to emerge, it is more likely for Latin America to be spun off from a previously combined unit.

And the combination of the two Americas has a further bit of a unique twist. Typically North America will be the dominant player, and therefore you might expect it to bring its southern neighbors into the fold. Yet at the Summit, it really felt more like Latin America was taking North America under its wing. Presumably this is largely based on the recent successful growth of Latin America under Mr. Cardenuto’s direction.

Over the course of two days we heard lots from SAP executives on the main stage, in smaller groups and one-on-one meetings. Some of what we heard simply reinforced the four pillars we have been hearing about quite consistently at various events over the past year or more, namely how SAP intends to:

  • Leverage the core business applications
  • Deliver in mobile
  • Lead in the cloud
  • Capitalize on big data (read: HANA, HANA, HANA)

But how do these key elements of SAP’s strategy pertain to the partners and the customers they serve?

Leveraging the core business applications

The key message here: industries are important and partners are critical to building out solutions. There will be common processes across all companies. These common processes are easily handled by basic functionality that has become quite commoditized today, making it hard for any software company to differentiate itself solely on the basics. It is equally hard for any customer running “just the basics” to gain a competitive edge.

SAP’s approach to delivering that source of differentiation is to co-innovate with partners and customers. First of all, SAP constructs specific “value maps” for each of 25 different industries, identifying market trends and specific business capabilities required to compete in these markets. It then creates very unique blocks of solutions for each industry.  The goal is to not just deliver technology, but to create more value for its customers, and therefore SAP is taking a design thinking approach. This has been music to my ears, which are tuned more to business issues than pure technology. I spend much of my time and efforts translating techno-speak to business-speak.

Design thinking is becoming more and more popular these days, but in case you are not familiar with the concept, it is a repeatable process for solving problems and discovering new opportunities. It consists of 4 key elements:

  1. 1.    Define the problem
  2. Create and consider many different options
  3. Refine selected directions
    Repeat steps 2 and 3 until you reach…
  4. Pick the winner; execute

As the pace of change accelerates, as technology allows us to solve problems previously deemed unsolvable, SAP understands it can’t possibly deliver all this value itself, and therefore turns to partners. As Chakib Bouhdary, EVP Industry Solutions and Customer Value stated on stage, “We all have to change our tolerance to IP sharing.” This is an important concept and one critical to encouraging partners to develop complementary solutions, along with a go to market plan that includes revenue sharing.

At first glance this “sharing” of IP and revenue might seem to pertain only to the traditional Value Added Reseller (VAR) or the larger service providers/system integrators. But during the Summit SAP also introduced the SAP PartnerEdge program for Application Development, “a simple and comprehensive program designed to empower partners to build, market and sell software applications on top of market-leading technology platforms from SAP.

How is this new and different? Essentially it lowers the cost of entry for small partners, while also simplifying the process of signing up. Partners can choose from a set of “innovation packs” based on the latest platform technologies from SAP, including the SAP HANA platform, SAP HANA Cloud Platform, SAP Mobile Platform, SAP databases and the SAP NetWeaver platform. The innovation packs contain technology-specific license rights, resources and services to help partners rapidly get enabled to develop applications on SAP platforms. The packs are also designed to support custom development for co-innovation with customers, which often is the first step to developing a more commercial, standard application. All for an entry fee of around 2500 euros.

These small partners pay a low annual fee (500 to 1500 euros per year) for each of these innovation packs. In turn they can also offer their wares through the SAP online app store and potentially reach a much broader market and therefore better monetize their efforts. This encourages a larger volume of smaller partners in a very real “win-win” scenario.

Deliver in Mobile

Notice the SAP Mobile Platform is included above as one of the innovation packs. The consumerization of IT has changed expectations of connectivity and accessibility of data. But nobody (in their right mind) really wants to lift and shift the traditional ERP user interface to a mobile device. Mobile executives today want answers to specific questions, hence the increase in demand for more purpose-built mobile apps. Lots of questions potentially generate the need for lots of mobile apps. And the SAP online app store is the perfect place for partners to showcase those they build on SAP’s mobile platform.

Lead in the Cloud

It seems everyone today wants to claim “leadership” in the cloud and SAP is no exception. With all the “mine is bigger than yours” rhetoric in the market today, determining who is on top is difficult and probably a bit subjective. However, after developing its own “born in the cloud” (SaaS only) business management suite (Business ByDesign), two major “cloud only” acquisitions (SuccessFactors and Ariba), 30 million users in the public cloud and the world’s largest business network supporting $460 billion in transactions, SAP has to be right up there on the leader board.

While there is still a lot of confusion over cloud and SaaS, the interest in both has taken a quantum leap over the past couple of years. I’ve written a lot about the benefits of moving to the cloud, but while others predict that very soon the vast majority of applications will be running in the cloud, my research indicates only 33% will be SaaS in 5 to 10 years. I attribute this to the fact that there are so many solutions running on-premise today and many companies are reluctant to rip and replace only to convert to a SaaS deployment model. So does that limit the number of companies that can effectively leverage the benefit of the cloud to those willing to abandon their current software licenses? SAP says, “No.”

Many of the companies running on-premise solutions would love to relinquish the responsibility of managing and maintaining those solutions and reap the benefits of the cloud. SAP’s answer to this is to offer Managed Cloud as a Service (MCaaS). This isn’t a brand new concept. Back in May, SAP announced its SAP HANA Enterprise Cloud. As I wrote back in May…

On May 7, 2013 SAP announced SAP HANA Enterprise Cloud. As the name implies, it is a cloud-based service that allows an organization to move existing (or new) implementations of the SAP Business Suite and SAP NetWeaver Business Warehouse, powered by HANA, off their own servers and into SAP’s massive data centers. Why would an enterprise want to do this? The short answer: Speed, power and the benefits of cloud computing without the disruption of replacing existing on-premise solutions. Speed and power come from HANA, adding visibility and agility to the business by enabling decisions to be made in real-time with volumes of data that were inconceivable just a short time ago. Cloud computing lowers cost and adds elasticity, allowing capacity to stretch as your business and your need for data grows.

This is not SaaS and is not a public cloud. It is really a private cloud for the customer managed by SAP. This was a purposeful decision on SAP’s part since the objective is to make the solution truly “elastic.” While this term may be common in technology circles, it is less so in the business community. Essentially, it means the customer is never constrained by hardware limitations. Data center configurations expand (transparently to the customer) as more computing power is required. And if there are any lingering concerns about applications running in a public cloud, those go away with this model.

So what does this mean for partners and how is MCaaS different? It means they can bring the benefits of the cloud to those not quite ready for a SaaS solution. Partners can purchase product licenses and offer them, along with other services on a subscription basis. While this is the same concept introduced with the HANA Enterprise Cloud, HANA is not a requirement, nor is the Business Suite. SAP may be hosting the software, but partners may also sign up to do the same. SAP Business One and Business All-in-One are already offered in this kind of hosting model by several of the larger partners.

Capitalize on Big Data (HANA, HANA, HANA)

This was the first SAP event I have attended in a long while where HANA was not the primary focus. Yet its presence was certainly implied, if not directly referenced. Steve Lucas, President, SAP Platform Solutions talked a lot about “the real time connected enterprise:”

  • Real time business applications
  • With real time integrated analytics
  • Delivered on any device in real time (securely anywhere in the world)

Of course you need HANA for this. But I think the real message for the partners here is that SAP needs them to deliver applications that leverage HANA. This makes Dr. Bhoudary’s comment about SAP’s tolerance to IP sharing even more relevant beyond the concept of building out industry solutions. I’ve said it before and I’ll say it again (and again and again if necessary)…Without this way of thinking, without the development of applications leveraging its technology, HANA is simply an elegant technical solution in search of a problem. And as Steve Lucas said, “No one wakes up in the morning and says, ‘I really want to install HANA.’ They wake up with problems to solve…. Partners make it real.”

 

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SAP Business Suite on HANA: Software that Reinvents Business. Reinvented.

Really? Yes, Really!

On January 10, 2013 SAP announced the availability of SAP Business Suite powered by SAP HANA, a new option for SAP Business Suite customers and an opportunity for SAP to deliver “transformative innovation without disruption.” That’s a mouthful, but one that has the employees at SAP super excited. While the announcement was well-received and the audience seemed to like what it heard, this group of IT influencers didn’t seem to exhibit that same level of excitement. But influencers can be a jaded bunch. All too often as you start to dig deeper you find the story just isn’t all that new or different. In this case I believe the tables will be turned. As influencers and SAP customers alike begin to explore and understand the new and very real possibilities, what first appeared to be just “interesting” will truly become exciting. And there is no limit to those opportunities to innovate.

The HANA Story: What It Means to Business

Part of the reluctance to “feel the excitement” might stem from the fact that we’ve been hearing about HANA for a few years now. Six years ago Hasso Plattner, cofounder of SAP and Chairman of its Supervisory Board, had a vision of what the system of the future would look like. That vision included:

  • All active data must be in memory. In Hasso’s words, he wanted to “get rid of the rusty spinning disk.”
  • Full exploitation of massively parallel processing (MPP) in order to efficiently support more users
  • The same database used for online transaction processing (OLTP) and analytics, eliminating the need for a data warehouse as a reporting tool for OLTP to support live conversations rather than “prefabricated briefing books”
  • Radically simplified data models
  • Aggressive use of math
  • Use of design thinking throughout the model

But such a vision obviously took time to deliver, so for the first few years the world heard about this transformative technology, but couldn’t touch, feel or see it. In 2011 we started to see some results as HANA for analytics became a reality and pioneering companies began to see performance improvements previously unheard of in terms of speed and the ability to handle massive volumes of data.

In 2012 it became real as SAP released HANA as a platform for developers. But the vision was still one of powerful technology and much of the talk over the past six years has been presented in very technical terms. “Here is this super technology; let’s work together to find ways to use it.” That’s not necessarily how business executives and non-technical decision-makers think. Instead they think in terms of business problems. “I have this problem. How are you going to help me solve it?”

While the ability to “support live conversations” and efficiently “handle more users” might resonate with a business executive, these messages were often over-shadowed. Business executives don’t necessarily perceive the value of eliminating disks, simplifying data models or using math. They don’t know what MPP is or design thinking.

So now, with this announcement, SAP is trying hard to change the conversation to be less about the technology and more about the business value.  What is the real value? In the words of one early adopter: HANA solves problems that were deemed unsolvable in the past.

It is in uncovering these types of solvable business problems that the excitement will build. As Dr. Vishal Sikka, member of the SAP Executive Board, Technology and Innovation said, “Now the software at the heart of thousands of the world’s best-run companies can work and think as fast as our imagination.” But many business executives simply don’t have the same kind of creative imagination as a Vishal Sikka or a Hasso Plattner.

SAP Business Suite might be reinvented on HANA but how does that help customers reinvent their businesses? The trick will be in unleashing their imaginations and helping them see the possibilities. Yet in its attempt to make the message universal and relevant at the highest levels of its customers’ organizations SAP often introduces a level of abstraction that is lost on its audience. So we need to translate some of these high level messages into something that might be a little more concrete.

Becoming a real-time business

SAP’s brochure says, “Becoming a real-time business requires managing daily business transactions of your core business processes in real time, such as finance, sales and production – and as well, to capture data from new sources like social media, mobile apps or machine sensors.” However, how many enterprises today have a stated goal of “becoming a real-time business?” They don’t. They have goals such as growing revenue or reducing costs to improve profits. They may or may not be able to connect the dots between those goals and collecting and analyzing data in real time.

For those dealing directly, or even one step removed from an actual consumer or consumer product, the value of data from social media and/or mobile apps might be intuitive. For these companies, their brand is of paramount importance and they take great risk in ignoring social media or opportunities to connect directly with potential customers through mobile devices. So adding this dimension to the decision-making process should be well-received once you get the customer to think in those terms.

For manufacturers of industrial products… not so much. The world is changing, but slowly. It is entirely possible for them to think “social” isn’t business; it is something someone does on their personal time. And mobile devices are what their kids use to text their friends, play games and listen to music. For those same manufacturers, machine sensors and automated data collection (ADC) devices may have been on shop floors for many years. Those sensors and devices may in fact have the ability to shut down a line of production before bad product is produced. But can the data be effectively analyzed in order to improve products and processes? It is very possible that vast quantities of collected data have been underutilized for years, for one simple reason – there is just too much of it. And because it is collected continuously and automatically, it is constantly in a state of flux.

That thought actually brings to mind a parallel in history that dates back to the 1970’s.

Will HANA Bring to IT what MRP brought to Manufacturing?

The business world hasn’t seen something with this kind of potential impact emerge on the market since the introduction of MRP in the 1970’s. Those outside of the world of manufacturing might not appreciate the real significance MRP had, but there are a lot of parallels between the potential for HANA and the automation of the planning process that MRP brought about.

In a nutshell, MRP (material requirements planning) takes a combination of actual and forecasted demand and cascades it through bills of material, netting exploded demand against existing inventory and planned receipts. The result is a plan that includes the release of purchase orders and shop orders and reschedule messages. While the concept might be simple enough, these bills of material could be many layers deep and encompass hundreds or even thousands of component parts and subassemblies. Without automated MRP there is simply too much data and complexity for a human to possibly work with.

As a result, prior to MRP, other ways of managing inventory became commonplace. You had simple reorder points. Once inventory got below a certain point, you bought some more, whether you actually needed it or not. You also had safety stock as a buffer, and the “two bin” system was quite prevalent. When one bin was empty, you switched to the other and ordered more. These simplistic methods may have been effective in some environments, but the net result was the risk of inflated inventory while still experiencing stock outs. You had lots of inventory, just not what the customer wanted, when it wanted it. And planners and schedulers still had to figure out when to start production and they knew enough to build a lot of slack time into the schedule. So lead times also became inflated and customer request dates were in jeopardy.

Once MRP entered the picture, these were seen as archaic and imprecise planning methods. Even so, most didn’t rush right out and invest in MRP when it was first introduced. In fact now, decades later, the adoption rates of MRP in manufacturing still sits at about 78%. Why? The existing practices were deemed “good enough” and, after all, that’s the way it had always been done.

It required a paradigm shift to understand the potential of MRP and the planning process executed by MRP was complex. Not everyone intuitively understood it. And if they didn’t really understand, planners were unwilling to relinquish control.

Yet over time, MRP brought a new dimension to material planning. It brought a level of accuracy previously unheard of and helped get inventory and lead times in check. Manufacturers can experience an average of 10% to 20% reduction in inventory and similar improvements in complete and on-time delivery as a result of implementing MRP.

Now with HANA we’re introducing the potential to improve processes, not by 10% to 20% but by several orders of magnitude. But it also requires a paradigm shift.

Manufacturers, as well as other types of companies, are quite accustomed to making decisions from a snapshot of data, usually in report format, possibly through spreadsheets. They have become desensitized to the fact that this snapshot is just that, a picture of the data, frozen in time.

What if you never had to run another report? Instead, whenever you needed a piece of data or an answer to a question, you had immediate and direct access, not to the data as it was at the beginning of the day, or the end of last week, but to the latest data in real time? That’s what Hasso envisions when he talks about “live conversations versus prefabricated briefing books.” But those used to making decisions from those briefing books need to be educated on the possibility of the live conversation.

And, oh, by the way, traditional MRP, a game changer in the 1970’s and 1980’s is in for a major transformation.  Early MRP, and even versions of MRP today took and still take a long time to run and need exclusive use of the data. So it is typically run overnight or over a weekend. Think of the possibilities if it could now run in minutes or even seconds. Is that possible? With HANA, yes.

“Transformative Innovation Without Disruption”

In his opening remarks Hasso introduced the concept of “transformative innovation without disruption.”  In fact innovation was a key driver for John Deere, the early adopter of HANA mentioned previously in the context of solving previously unsolvable problems. Derek Dyer, director, Global SAP Services, Deere and Company outlined three ways in which the company views HANA as a game changer:

  • Bringing new innovation to the business by solving problems deemed unsolvable in the past
  • Simplification of the IT stack while introducing the ability to deal with huge volumes of data
  • Better serving the business by providing real-time access to data for better decisions

John Deere was originally attracted to HANA based on the performance aspects of the platform. The “Wow!” it was seeking was speed. It has had some initial success with its early projects, but sees a new world with ERP now on HANA. It intends to transform itself from a manufacturing company to a solutions based business. An example: It plans to take data from sensors in equipment in the field, determine how the equipment is being used, under what conditions. Not only will the data be real-time, but it will also allow them to answer back to the customer with very personalized, specific answers, and also support better collaboration with suppliers, dealers and customers.

Seeking Innovation

John Deere and other early adopters can provide some examples and perhaps some motivation, but each company will have to discover its own possibilities for changing the game. This is where SAP’s reference to “design thinking” comes into play. It is a protocol for discovering new opportunities and for solving problems.  It starts out with defining the problem. Because these problems might, as John Deere points out, have been previously deemed unsolvable, this step might not be as simple as it sounds. But it is the first critical step in finding that “excitement.” It can also be the most difficult. SAP and its partners can help.

What about Disruption?

The very term “disruption” is a source of controversy these days. Many talk about “disruptive technology” and refer to it as a good thing. But there are different kinds of disruption. A new technology that disrupts the way you think about problems and processes can have a very positive influence. But when new software (for example a new release of ERP) disrupts your business because you can’t ship a product or support your customer, it is definitely a bad thing. Upgrades to software like the SAP Business Suite are often viewed as disruptive in the bad sense, rather than in a good way. This is the kind of disruption SAP is promising to avoid.

Customers can take advantage of the Business Suite on HANA without upgrading their existing Business Suite. Current reports and customizations are preserved, including integration with other applications. And even partial migrations are possible. And there is no forced march now or in the future. SAP remains committed to supporting the customer’s choice of databases, including database technology and vendors. So the choice is left to the customer.

Yes, there is a cost associated with moving the Business Suite to HANA, but pricing for the new database works similarly to pricing for other databases even though the customer will experience huge improvements in speed, including 10 to 1000 times faster analytics.

Key TakeAways

It is clear that a key value proposition for SAP HANA is speed, but the vast possibility for business innovation trumps the value gained for improved performance. But each SAP Business Suite customer will have to identify its own possibilities for innovation. For some these opportunities for innovation may be staring them in the face. Others will have to dig deep into existing processes and identify those problems they have been living with for so long that they might appear to be unsolvable. Once uncovered, ask the very real question, “Can I solve this problem today with HANA?”

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SAP responds to the 3 V’s: Increasing Volume, Velocity and Variety of Data

Last week I attended one of the SAP Insider events, the one that combines Financials (Financials2012), Governance, Risk and Compliance (GRC2012) and Human Resource Management (HR2012). I have to admit that HR was the odd man out here. I work with the GRC, financial applications and Enterprise Performance Management (EPM) teams at SAP, but I only watch the HCM space from the periphery. That may change over the next year if companies that are, from my perspective, largely “ERP vendors” continue to acquire and invest in this space. For those who have been living under a rock for the last few months, SAP recently acquired HCM solution provider SuccessFactors and Oracle acquired talent management vendor Taleo. Sanjay Poonen (@spoonen), President & Corporate Officer, SAP Global Solutions made an interesting comment about this acquisition in his opening keynote to all three groups. He said that SAP had “followed our customers, who voted through their wallets.” I believe he was referring to both HCM as well as movement to “the cloud.”

Sanjay kicked off the event highlighting a key concern of many business executives today: the difficulty in keeping up with the increasing volume, velocity and variety of data. Actually Sanjay referred to it as “Big Data” although I suspect that phrase has not completely infiltrated the vocabulary of most top executives… at least not yet. I think there is still an education process that needs to happen before many will understand they have a data problem.

There is no doubt that anyone running a business today understands that both the speed of business and the speed of change, hence the velocity continues to accelerate. Nobody would argue that customers are more empowered and connected and expect service instantly and this, together with continued globalization increases the volume of data required. But have top executives really come to understand that data required for planning and decision-making also expands beyond the traditional boundaries of data that is collected and stored in enterprise applications? Some have, but many, particularly those in smaller companies, have not. This is in part impacted by the “social business” movement. CFOs represent the largest target market for Financials and GRC and CFOs are not known to be the most “social” folks on the planet.

That said, even the increasing volume of traditional data might be enough to prompt action. This was the case for Harcourt Houghton Mifflin, highlighted in Sanjay’s keynote. The merger of the two companies resulted in 8 mini companies, disjointed data, fragmented processes. All of this was going on during a financial crisis. The goal was one version of the truth on an integrated platform to support integrated business planning. Of course the reason Harcourt Houghton Mifflin was featured in Sanjay’s opener was because their solution to this problem was SAP’s Business Planning and Consolidation (BPC) solution.

Harcourt Houghton Mifflin needed to get alignment among stakeholders. According to the video played, they were “looking for something easier to use than Hyperion.” They needed to transform the planning process and they feel EPM 10.0 changed the nature of the way people manage performance across finance and operations. The real power comes not from analytics as a separate tool but from embedding them directly into the applications wherever they are needed.

And therefore the one big announcement from SAP during the event serves to emphasize the convergence of these 3 V’s: volume, velocity and variety. The announcement was that BPC is now running on HANA, SAP’s answer to the “big data” problem. According to Sanjay, “The power of SAP HANA enables financial professionals to perform faster planning, query, reporting and analysis, profitability and simulation in real-time. As a result, SAP helps companies accelerate period-end closing and smarter decision-making — faster than other vendor offerings available today.”  So the message transcends the annual planning, budgeting and forecasting exercise and applies equally to the ongoing financial consolidation and reporting exercise.

However, it is only the Netweaver version of BPC that is powered by HANA (there is also a Microsoft version) and for this to work, the customer needs to be running a version of BW on HANA. The reality is that the version of BW sitting on HANA is still in what SAP calls “ramp up” (i.e. early adopter or what other vendors might call beta testing). So customers interested in BPC on HANA either need to be in this ramp up program, or they need to wait until it is generally available. SAP is hoping that it will exit ramp up by Sapphire in May.

I am hoping to do a more in depth analysis on this once customers are running live. In the meantime, the education process around big data and data management strategies needs to continue. This is more than SAP just creating the need in the mind of their customers and prospects for the technology solution it has developed. This is a real problem for many CFOs today. Many simply don’t understand that technology has advanced to the point of providing a solution.

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Are You Ready to Change the Game In Driving Corporate Performance?

UNIT4 Says “There’s an App for That”

 Speed is the name of the game today. Whether we’re talking about technology innovation, market or economic change or simply the pace of business, acceleration is happening. Mid-sized organizations in particular are pressured by a continuing array of changing circumstances – macro market, competitors,workforce, regulatory actions and financial constraints – all in rapid-fire succession. A wide array of organizational stakeholders need to have the ongoing ability to input/consolidate/analyze changing information , view live performance results tied to current processes, assess risks, and seize opportunities. They need answers and they need them fast.

And yet, the wide array of corporate performance management (CPM), enterprise performance management (EPM) and business intelligence (BI) tools available today are neither fast nor easy to deploy for continuous ‘right-sized’ decisionmaking, nor easily accessible for the wider organizational hierarchy of workers. Nor are they available in a more desirable “pay as you go” format popularized by app stores.  UNIT4, a company known for bringing change-embracing software solutions to market, says look no further for a fresh approach to analytics because now there’s “an app for that”:  UNIT4 Business Analytics Apps.

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ANALTYICS TODAY:  Bulky, tool-like, slow

Organizations should not be forced to settle for large-footprint, expensive, multi-month deployments of licensed analytic software that add new cost with each new requirement.  And yet this has been the only option for many looking for answers from the enterprise resource planning (ERP) operational backbone to which they are tethered.   As deployments have expanded, responding to changing needs and making decisions are like steering a battleship, when in fact today you need the speed and flexibility of a high-powered speedboat. And yet, the hundreds of thousands, or even millions of dollars invested in these solutions makes it harder and harder to abandon ship.

 Some of the largest, most dominant ERP solution providers have attacked the problem through acquisition of equally “large” analytical tool sets that add bulk to the solution and have the potential of further slowing down the decision-making process.

Hence, the global business and public sector community has installed literally millions of large-footprint, licensed software deployments.  That formula is being challenged by a convergence of new mobile and cloud technologies, and fed by the growing impatience of buyers who are questioning big spends tied to long contracts.  What are the choices today?

Enterprise Resource Planning (ERP)

As an integrated suite of modules that forms the transactional system of record of the business, ERP can provide a wealth of data. But thinking ERP is the answer, per se, is like expecting to get a drink of water from a fire hose without being blasted with far more liquid than you can possibly consume. What you really need is a glass of water. You certainly don’t want to constrain or eliminate the power of the fire hose, but you do want a more manageable way of dispensing and consuming the water on a day-to-day basis.

As ERP solutions have matured over the past several decades they have grown broader and deeper, expanding beyond traditional boundaries, adding more force and power. This is all good because after all, these transactions are the pulse of your business and ERP, in sustaining that flow, has traditionally been viewed as the heartbeat. But if you view ERP as the heartbeat of the decision-making process you will skip a lot of beats, and you certainly don’t want to undergo open-heart surgery every time you need to make an adjustment (change) to your business.

Furthermore, how many people do you know have the patience and fortitude to search for answers by diving right into the details of their broad ERP solution? Whether you are an executive or first-rung manager, most workers don’t have the Information Technology (IT) expertise to drill much beyond what is shown in executive dashboards.  Smaller, bite-sized, but important data collection/consolidation/review and decision-support actions get lost in the larger ERP environment.  The lack of ability to perform these continual, repetitive analytic actions – potentially totaling thousands of daily small performance actions in even a mid-sized organization – can add up to a fairly toothsome financial outcome.

Business Intelligence (BI)

You might ask, isn’t “intelligence” what Business Intelligence is for? The concept behind BI is that, yes, you can distill data, slicing and dicing it in order to extract the “intelligence” from it. The problem is BI is generally delivered as a tool set, which transforms the burden of deciding “what do I need to measure, in what places, how often and with what associated actions” … into a fairly complex task force requirement.  Once the group aligns on these matters (often taking weeks or even months), it must still shop for the tool, validate whether it is compatible with the existing ERP backbone, install, test, train and roll it out.

True, there is no limit to the type of analytics that can be developed using these tools. But the journey is long and it involves considerable departmental, IT and economic commitments.  What’s more, when the first outlier question needs to be answered (i.e. one not previously anticipated), recoding of BI applications can put the team right back at square one of the process.

Corporate Performance Management (CPM)

If a tool set doesn’t meet the needs of the organization, how about Corporate (or Enterprise) Performance Management (CPM/EPM) suites?  To date these have been quite loosely defined and often include financial planning, budgeting and forecasting, cash management, consolidation, legal/financial reporting, and sales performance, but may also include corporate governance, strategy and risk management. These are all critical functions but in taking a suite approach, we are right back to the problem we have with ERP. You lose focus. You don’t need a full suite to answer a particular question or drive one specific decision.

As you can see, it is no surprise that what we have today is a lot of confused decision-makers with no clear idea of where to even start to shop for solutions.

Where in the World?

And to further complicate matters, consider that today’s workforces are consistently on the move, not sitting at a desk behind a computer. They may be visiting remote locations of their own operations, making customer or partner calls or have a mobile-defined job. This makes web-based access very important, if not a “must have.” And with growing organizational reliance on smart phones, iPads and other tablets, workers now expect to find answers on whatever devices they carry with them.

This makes the concept of organizations having the ability to download a templated pre-defined analytics app, extend it as needed to a limitless array of workers (executive and non-executive; mobile or office-centric); and allow them to access and perform change easily – a very appealing proposition.

Introducing UNIT4 Business Analytics Apps

This is exactly the concept UNIT4 is introducing in its new Business Analytics Apps: turnkey, analytic-infused, purpose-built applications to solve a specific problem or meet a particular need. Think of these as bite-sized, “tapas-style” individual applications, available online to organizations through an apps store, easy to download, easy to complete, small and digestible.  Each is a rapid, targeted repeatable response to a specific (often recurring) organizational need, representing a small pay-as-you-go investment with little to no risk, and yet produces a quick Return on Investment (ROI).

UNIT4 Business Analytics Apps are turnkey solutions, 90% complete with two rapid-fire choices for the last 10% of organizational tailoring/deployment:

  • A do-it-yourself option via embedded ‘build & go’ capabilities that’s particularly fitted for those organizations that aim for complete independence to address performance challenges and/or opportunities
  • A turnkey professional service bundle of 5, 10 or 20 days (depending on requirements) via a UNIT4 (certified) professional services team to get it to 100%

Each app will have embedded pre-built analytics tailored specifically for the solution. These analytic-infused solutions do not fall into the traditional categories of ERP, CPM, EPM or prototypical BI tools; they are a reinvention of the performance solutions market.

UNIT4 is working hand-in-hand with strategic customers in various verticals to develop the turnkey solutions. These customers represent industries including local government, education, retail and professional services. The first wave of Business Analytics Apps, true purpose-built, ready-to-consume apps that will also be smartly integrated with UNIT4’s core solutions Agresso Business World (ABW) and CODA Financials. These solutions offer customers a rapid targeted response to business change, emerging risks or new opportunities. The underlying architecture is change-enabling, whereby a change made in one application automatically flows to the other applications.

The first application will be introduced to the market in March 2012. The UNIT4 Business Analytics Apps Store is projected to be open for business in June 2012 with the first wave of applications. From that moment on, subsequent waves of solutions are to be released at quarterly or half-year intervals.

How Do Bite-Sized Analytics Change the Performance Game?

Do these Business Analytic Apps replace ERP or financial transactional applications? No, there will always be a need for ERP and ERP-like transactional systems. However, this approach could very well dramatically change how data collected and stored in these transactional systems is consumed.

It has always been easier to get data into ERP than to get actionable intelligence out. Hence much of the value is left on the table with information that is largely untapped beyond dashboard-like state-of-the-business views. With broad, deep and multi-purpose applications, most organizations simply don’t know where or how to start – without significant resource commitments on multiple levels. By creating these bite-size apps that address recurring specific needs, organizations can simply download the apps, finish them off in a manageable number of days, deploy via their mobile workforces and quickly gain value.

ERP and the accompanying performance solutions acquired by ERP vendors in billion-dollar deals are big-ticket items. And with deployments that take months or years, it’s not a stretch to say this is a scary spend for most organizations. Alternatively, UNIT4’s scalpel-like approach to enabling multiple roles in the organization to solve performance issues offers organizations a no/low-risk value proposition with a fast return, at a very affordable pay-for-use price point.

This approach eliminates much of the analysis-paralysis that can accompany a major undertaking like ERP. And it will also eliminate the confusion and the decision-making over what kind of a solution is required. You won’t need to choose between ERP, BI and/or CPM. These categories will be meaningless in this context. You will just download the app that answers your question or satisfies a particular need.

How Unique is UNIT4’s New Analytic-Infused App Platform?

UNIT4’s newest  Business Analytics Apps suite is not unlike the vintage 1980’s Reese’s Peanut Butter Cups commercial where two people accidentally combine their individual chocolate and peanut butter confections into a breakthrough candy sensation. The “genius” is this bundle of individually proven components:

  • Pre-built, 90% complete templates
  • Available via an app store
  • A turnkey professional service bundle of 5, 10 or 20 days, depending on requirements, to finish it off
  • (Or) a “do it yourself” approach to finish the last 10% based on the embedded ‘build & go’ environment
  • Pay-for-use model
  • Change-embracing platform
  • Backed by 30 years of enterprise problem-solving experience

One truly unique feature not currently available in the market, the embedded social-collaboration capability that allows users to continually amend, change, aggregate and input fresh data and results into the template. This “new” flavor of change for UNIT4, allows the company to advance its reputation as the enterprise solution market’s most change-friendly vendor.

Recommendations and Key Takeaways

For those organizations currently deploying the traditional array of ERP, EPM, CPM or BI tools, it will become increasingly difficult to justify spending money on what (for many companies) is software shelf ware. These turnkey, analytic-infused, purpose-built applications designed to solve a specific problem or meet a particular need can eliminate large up-front spends on EPM/CPM licensing, and significantly reduce (if not eliminate) the effort to define measurements/processes, key performance indicators (KPI’s), and data feed sources. Implementation and training will reflect the ease individuals experience today in downloading and running consumer apps. UNIT4 Business Analytics Apps begin to bridge the gap between consumer and enterprise apps that the industry is talking about but nobody is (yet) delivering.

Businesses and organizations seeking performance enhancements should see benefits from a more targeted response to their specific needs, and there will be a direct correlation between what you pay and the value you receive.

Existing UNIT4 customers should take advantage of the opportunity to help UNIT4 define these new bite-size apps. The more involved you are, the more your specific needs will be met. UNIT4 claims that “imagination is your only limit.” Those business leaders that can imagine a new world of apps will reap the highest reward. Start imagining.

 

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SAP Mobility @ Madrid: Is it for SMEs too?

Recently I had the opportunity to speak with  SAP’s Senior VP of Mobile Strategies, Nick Brown to get a preview of the “mobility” announcements planned for SAPPHIRENOW + SAPTechEd, co-located in Madrid this week. As anyone that follows SAP knows, mobility is one of its three hottest topics, the other two being cloud and in-memory computing. Since May 2010 when SAP announced its intended acquisition of Sybase, the mobility buzz has been about an integrated platform and application story.

Mobility for the Masses

SAP’s goal is to bring mobility to the masses. But this means something different to enterprises than it does to consumers. Or does it? I came away from the briefing understanding that at least one of the key objectives for SAP’s mobility strategy was to enable any size company to mobilize. Since I have a lot of interaction with the SME (small to midsize enterprise) teams at SAP, I immediately thought about the impact of these announcements on these smaller companies.

Since the Sybase acquisition, we’ve heard a lot about the Sybase Unwired Platform (SUP). The easiest “hit” for SAP here is with large companies with large IT staffs that worry about managing a large variety of devices. Talking about MEAP (mobile enterprise application platform), MCAP (mobile commerce application platform) and MDM (master data management) resonates here. But to most executive decision-makers that’s just alphabet soup. And those acronyms are even more foreign to decision-makers in your typical SME. They think a lot like consumers. They just want to consume; they don’t have big IT staffs to worry about a “platform.”

What SMEs want

SMEs want ready-to-use applications that address a specific business need. They just assume (rightly or wrongly) that the apps come with the necessarily underlying infrastructure to take advantage of the latest and greatest technology (think 3G and 4G), deliver security and work on any device they might want or need to use. That means they don’t expect to pay extra for it and perhaps they don’t expect to have to “buy” it at all. In fact they don’t necessarily even connect the dots from mobilization back to “IT” and core enterprise applications like ERP, which create the system of record for their business.

My “mobility” research shows that the number one priority for mobilization of tasks or functions is performing approvals and authorizations, followed closely by receiving alerts and notifications. And yet my “ERP” research shows that less than half (47%) of companies rate the ability to access ERP data from a mobile device as “important” or “must have,” 26% said it was “somewhat important”, 22% called it a “nice to have” and 6% said it wasn’t a consideration at all. Taking photos and attaching them to records rated higher than mobile order and account management. And the smaller the company, the less priority they seem to place on accessing ERP through a mobile device. A lot of companies still don’t get the connection between this proactive management and the underlying enterprise data that runs their business.

What must SAP do to address that?

First of all it needs to deliver applications that budget holders see real value in. And those applications are finally starting to flow out of the funnel. SAP is showcasing 50 of them at SAPPHIRENOW in Madrid this week. I went out to the App store earlier this week and counted 45 that are currently available. Twenty of them are free, 11 are from partners. While today there are more SAP-developed apps than partner-developed apps, SAP expects that to change dramatically and ultimately expects 80-90% to come from its ecosystem of partners. There are 200 of them undergoing certification by SAP right now. But partners will only do that as long as they are successful in selling them.

Because of the sheer volume of SMEs (compared to large enterprises), it would seem SMEs would be key to that success. And for SMEs to consume them, they must be affordable. And that means the cost of the platform cannot inflate the price of the apps.

Dennis Howlett (@dahowlett) has been very vocal on this subject. In fact he just published his insights on the mobility announcements in Madrid, including this excerpt:

“I have said before and I repeat here: SAP should give the platform away in most cases. It doesn’t make sense to developers if they have to pay for a platform at high cost. Apple managed to build a highly successful business by making the barriers to developers trivial. SAP is still trying to wean itself on the idea that everything has to come with a Veuve Cliquot price tag.”

So we will have to watch this closely to see how many apps continue to be produced and consumed and ultimately what stance SAP takes on the price of the platform. This will have significant impact on SMEs.

What Else?

How else can SAP educate customers and prospects? Another way is by use case examples. SAP showcased one in particular in Madrid and in its press release. This one was developed specifically for Berlin’s Charité, a big university hospital in Europe. In a way this is not the best way to reach and educate SMEs on the potential for mobilization because this was custom developed and is very specialized to serve physicians and hospitals, not something that helps an SME run its business better. On the other hand, it provides a showcase of an environment that is personally familiar to everyone.

The story is about mobilizing Electronic Medical Records (EMR) so that doctors can access patient information reliably from anywhere. It’s about letting the doctors record notes right in the application during or immediately after examining a patient, so they don’t have to be transcribed later. Everyone can understand it (and its value) because most of us have been patients at one time or another. Not only do we all understand the value of having more and better records and immediate access and the frustration caused by not having that direct access, but we are also quite sensitive to privacy and security when we’re talking about our own personal health records.

Other applications announced in Madrid include:

  • SAP CRM Sales 2.0
  • SAP Field Service 2.0
  • SAP Retail Execution 2.0
  • SAP Citizen Connect
  • SAP Transport Notification & Status
  • SAP Transport Tendering
  • SAP GRC Access Approver
  • SAP GRC Policy Survey
  • SAP Manager Insight (announced in October)
  • SAP Interview Assistant (announced in October)

Also worth noting are the “2.0” designation of the first three apps. The first releases were in June; now we have the second in November, just five months later. This tells us the 12-18 month release cycles are becoming a thing of the past. SAP promises releases to be quarterly in future – something else worth watching out for.

Mobility should be of enormous interest to SMEs. Let’s see if SAP can help them connect the dots to show them how mobile access to enterprise data can help them run better businesses.

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Engagement vs Transactional Systems: Not a “from-to” especially for SME. SAP as an Example

I recently read Ray Wang’s Blog in the Harvard Business Review entitled “Moving from Transaction to Engagement” and something about it didn’t sit well with me. I wasn’t getting the “from – to” part. Recording transactions isn’t optional. Whatever tool you use to create your system of record (whether it is ERP or accounting applications or something else) is a necessary foundational tool. If you think tools that help you build relationships can replace transactional systems, then maybe you believed “eyeballs were everything” back in the dot-com boon and we all know how that story ended.

Since it troubled me I went back and read all the comments to Ray’s blog post and also a couple of pieces he referenced: Geoffrey Moore’s paper “Systems of Engagement and The Future of Enterprise IT: A Sea Change in Enterprise IT” and Dion Hinchcliffe’s “Moving Beyond Systems of Record to Systems of Engagement.” OK, I feel a little better now. But only a little.

I feel better because both Geoffrey Moore and Ray (in response to a comment) acknowledge that these transactional systems of record are necessary. And even Dion Hinchcliffe admits, “It’s safe to say that most firms would go out of business without the data within and automated capabilities of their systems of record.” But to say, they are all in maintenance mode, “ERP has hit its limit” and that “Transactional systems remain in a hard coded, rigid structured approach” ignore the change in how software is developed today and the real possibility of bringing better means of flexibility, engagement and communication to ERP. Yes, ERP must bring discipline and therefore must define data structures, but that doesn’t mean the application or implementation needs to be rigid.

I define ERP as an integrated suite of modules that form the transactional system of record for a business. So when we talk about transactions and systems of record, I assume we are largely talking about ERP. The trouble is, it has become harder and harder to tell where ERP ends and other applications begin. But that’s a good thing. It means software makers are providing added functionality and that ERP is seamlessly interacting with other applications. So why can’t we bring these characteristics of engagement systems (and maybe even experiential systems) to ERP? I’m not going to go down the route of “personal fulfillment” systems because we can’t lose sight of the fact that the purpose of the engagement is to generate transactions (because transactions mean revenue). I know I am over-simplifying but, I don’t think most executives want to discuss speed in the context of a time-space continuum and businesses can’t survive in a “feel good” environment where everyone gets a trophy for “engaging” regardless of whether revenue is flowing in.

SAP has gotten picked on a lot lately as a legacy application and as rigid, so let’s take SAP and its approach as an example of how transaction systems can be enhanced, not replaced by engagement systems. And let’s talk about it in a way that is not just for the large enterprise, because 78% (90,000) of SAP customers are small to midsize enterprises (SMEs). Customers are front and center of engagement, and to effectively engage you need to understand your customer. In order to understand your customer, you need data from a lot of different sources. Some of that data is structured and you are probably already sitting on a mountain of it from a variety of sources:

  • Your ERP system – what they bought, how much they paid, how well you performed in delivering product and collecting cash (all those pesky transactions).
  • Your support, contact or call center – including issues and resolution
  • Your Sales Force Automation solution – contacts, pipeline and quotes
  • Marketing Automation – how many times have you touched them?
  • Others might include document management, customer project management, engineering design and/or compliance specs, specific test results, etc.

SAP is approaching this by enhancing solutions from the outside in, rather than the inside out. What do I mean by that? I mean they are developing innovations SAP BusinessObjects Edge, business analytic applications and new dashboards and user interfaces that can be layered on any of their solutions, including those for SMEs like SAP Business All-in-One, SAP Business One and SAP Business ByDesign. That’s smart in two ways. First, they need only develop it once rather for each of their different ERP solutions. Secondly, by adding innovation in layers, they create the perfect environment for bringing data sources together from different applications. And in keeping these innovations on the “edge”, SAP can make them more “social” by tying in other sources of data, including “conversations” through chat and email, thereby supplying the “richer social orientation” of an engagement system. And once these new interfaces are placed on top of ERP, the user perceives them as a new and better ERP.

This also is the perfect opportunity to apply external business rules and event management, “smarter intelligence” that might otherwise be well beyond the reach of SMEs. Of course, looking beyond the conversations that might be shared between employees and customers, there is far more data out there about your customer than ever comes near your ERP and surrounding applications. There are Twitter streams and LinkedIn discussions and FaceBook pages. There are news feeds and stock watches. The list goes on and on. The trick is to put that data into the context of the data in ERP in order to put it into the context of your business.

And how you deliver it will be critical. Just constructing these focused dashboards is a good start. And perhaps good BI tools would be enough in the hands of a talented and well-staffed IT department, but SMEs won’t have that luxury. Part of “engagement” needs to be getting your employees, including business executives, to engage with the data that you have and that means engaging with applications -which is why it is more important for SAP to deliver business analytics as a configurable and ready to use application rather than just BI tools. But making these analytics accessible is also very important.

Business executives from large multi-billion dollar companies, down to the smallest startups want to be connected through mobile devices. And executives from smaller companies are just as likely to blur the lines between business hours and personal time, perhaps even more so because of the number of different hats they might wear in managing a small business. In our untethered world of mobile connectivity, we all become more tethered to work even in the “off hours.” And the older generation is now learning from younger generations and becoming more comfortable with specialized mobile consumer “apps.” In response, SAP is developing mobile apps and recognizes they must model consumer apps. That means they must be smaller in scope and more directly applicable to a particular function. No training required for the user interface and limited training required for the business process it is intended to perform.

SAP still has some decisions to make in making this type of mobility affordable to SMEs in a world increasingly moving away from corporate standards, producing a more “bring your own device” environment. But SAP has already delivered the SAP BusinessObjects Mobile app for iPad, in addition to the SAP BusinessObjects Explorer for iPad/iPhone , which is already one of the top downloaded apps for business with over 200,000 downloads from the Apple Apps store.

Of course no discussion of SAP would be complete today without mention of “in memory” but this is actually quite relevant in the context of both adding engagement characteristics to transactional systems and customer analytics. If you thought you were drowning in data before, once you open the door to capturing and channeling all these sources of public information, you will now be faced with a virtual tsunami of data. And make no mistake; this is not just a large enterprise problem. Once you open that door, you open the floodgates. So SMEs will need to deal with “big data” just as larger companies will. SAP is intending to bundle SAP HANA (its answer to big data) with SAP Business One for small companies, and SAP HANA will power SAP’s On Demand solutions, including By Design, but there might be a donut hole forming around Business All-in-One (BAiO). SAP HANA will be an option for both the Business Suite and BAiO and pricing has not yet been made public.

SAP is of course just one example, and I could have used other vendors as examples along the way. But SAP also has a very broad and deep footprint and has more irons in the innovation fire with more resources to bring to bear than your typical ERP solution provider. And SAP certainly touches a lot of SMEs (over 90,000).  But it also has a lot of history and a reputation of being rigid, in terms of both product and company. It hasn’t made the big splash about “Social” that Salesforce has recently. It’s been hard to miss Salesforce CEO Marc Benioff’s exhorting the virtues of the social enterprise.  But in the meantime SAP has been bringing more “engagement” to its transactional systems.

So the key takeaway here is that transactional systems can indeed take on some of the characteristics of an engagement system. While yes, they need to be structured, structured doesn’t necessarily mean rigid. I don’t think ERP has hit the wall – I think it still has a ways to go and many, including SAP still have the legs to take them there.

Disagree? Prove me wrong.

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SAP Business Analytics Keep SMEs Safe While Living on the “Edge”

 Living life on the edge can be thrilling, exciting and exhilerating. It can also be dangerous. Living life on the edge means you are moving at a pace where one mis-step can mean the difference between winning the race and falling over a cliff. Surviving today’s pace of business requires speed and agility of decision-making. Fast and efficient decision making not only requires lots of data, but also the ability to process and analyze that data at lightning speed, before it simply becomes history. Small to medium size enterprises (SMEs) face the same challenges of intense competition, globalization and acceleration of change, but often lack the tools needed to respond quickly and efficiently not only to data, but to events as they happen.

On June 14, 2011, SAP announced the latest offerings from its business analytics portfolio, tailored to fit the decision-making needs of SMEs. These include SAP® Crystal Server 2011 software and the 4.0 release of SAP® BusinessObjects™ Edge Business Intelligence (BI). Of course, when SAP used the word “edge” in its product name, it meant something a little different than the precipice that was implied in the opening paragraph. SAP’s use of “edge” implies these solutions lie at the perimeter of and complement enterprise applications like its Enterprise Resource Planning (ERP) products. And yet, most SMEs today do indeed live on the edge and are in danger of not being able to understand all facets of their businesses and make confident, data-driven decisions as events unfold, in real time.

Most SMEs today are looking for increased visibility to their businesses, beyond the traditional reporting, which tends to focus the eyes of the business in the rear view mirror. Today’s accelerated pace of business creates an added requirement to move away from using data only to understand what has already happened. Additionally all companies must also monitor events in real time in order to avoid danger, mitigate risk and respond to new opportunities. Yes, this is a requirement for all companies, but to date, SMEs have been far less well equipped while also being in far greater danger. Unlike the large enterprise with size and influence to provide a buffer, SMEs are more vulnerable to a mis-step.

The highlights of SAP BusinessObjects Edge BI 4.0 include:

  • Unified and integrated user experience
  • New and more powerful mobile BI
  • The ability to glean insight from both business and social data
  • New tools to handle complex data in real-time
  • More choice through additional deployment and integration options

SAP brings several different components of its business analytics portfolio to bear and several of these capabilities overlap. For example, the same new powerful BI functionality available through the SAP Crystal Dashboard designer not only provides added power, but also is instrumental in transforming the user experience and makes that data easier to consume. A dashboard can be constructed for each decision-maker, at any level in the organization, including the very top. And this dashboard can not only include structured data captured in enterprise applications, but can coexist with other frequently used applications such as email, calendaring, Internet searches. And it can integrate structured business data with unstructured data available from sources such as blogs, emails and other social media. New text analysis functionality brings a new level of analysis to the decision-making process. The combination of all these capabilities means the software can sit and watch and analyze while decision makers are busy running the business.

While BI certainly adds significant value to the enterprise, there have always been a couple of glaring deficiencies of BI tools in the past. First of all, you usually had to be a programmer (or at least IT savvy) to create the intelligence that was sought. A new inquiry, report, data cube or analysis required technical expertise. Sometimes even running those reports and inquiries wasn’t something your typical executive was likely to do. Secondly, you had to know what to ask and how to ask the question.

Not only has “self-service” been a key goal of SAP BusinessObjects Edge BI 4.0 for SMEs, but the search and exploration functionality within the Edge package brings a new level of intuitive search capabilities to exploring enterprise data. Think about how all of us have become proficient in Internet searches. We start with a phrase and as we learn more, we continue to refine our search. Similarly, Explorer uses a familiar keyword search and then allows the business user to drill down and through the enterprise data.  Adding text analysis applied to unstructured data adds a new dimension.

SAP has also introduced the concept of event insight to SME. Event insight combines BI with event management. Neither of these technologies is particularly new. BI tools have been around for decades, although they have certainly matured. Event management has also been available for more than a decade, but few business people understand the possibilities and few companies have deployed this technology, at least not to its fullest extent.

In fact, many readers might not even be familiar with the term. Often reference to “event management” draws a blank stare from the non-technical business user. Substituting the phrase “triggers and alerts” might cause the light bulb to go off, but dimly. Those unfamiliar with event management may not see the full potential of being able to automatically troll through data looking for an event or a condition that either occurred or failed to occur as planned. Hence the slow adoption rates over the past decade.

Event insight adds a new dimension to event management, observing events, detecting patterns, correlating relationships and attempting to define cause and effect. As a result, it has a predictive nature whereby it infers a particular expected result. This type of monitoring and automated analysis has been particularly effective for example in preventing credit card fraud, business activity monitoring and security monitoring. SMEs can benefit from event insight just as large enterprises can but two factors are most likely to impact adoption: cost and awareness.

SAP can more easily address the cost factor. It may be harder to address the awareness factor. Even rather simplistic event management has not made great strides over the past decade, partly because technology budget holders have not really grasped the potential. But now as social media starts to invade our business world, it will be all that much more important for business executives to monitor both structured and unstructured data, detect events as they happen, and mitigate risks to their businesses and their brands. The event insight capabilities, together with the future potential of in-memory capabilities that SAP has developed to process massive amounts of data, may just be the tipping point that will prompt companies to bring this technology into the mainstream and help SMEs safely but boldly operate on the edge.

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