Targeting The Emerging Services Economy
In a recent Mint Jutras report, Leveraging the Power of a Platform for Enterprise Applications, we encouraged business leaders to leverage the power of a modern, technically advanced development platform for agility, usability, extensibility and speedy innovation. In order to thrive in today’s global, digital economy, businesses need to be able to turn on a dime. We live and work in disruptive times and this potential disruption can have a cascading impact on the enterprise applications you use to run your business. In this report we take a closer look at how one enterprise application provider, FinancialForce, has responded to this challenge as it relates specifically to the new services economy. Built natively on the Salesforce Platform, FinancialForce provides enterprise applications purpose-built for service-based businesses.
Agility and the New “Services Economy”
While the name FinancialForce may imply a solution largely for the office of the Chief Financial Officer (CFO), its product(s) extend beyond accounting. In fact that is the hidden message when FinancialForce describes itself as “a customer-centric ERP.” Architected around the customer lifecycle, in this case “customer” actually refers to FinancialForce’s customers’ customers. With an eye towards full engagement with that customer, from opportunity to delivery and revenue, it offers a full-fledged enterprise resource planning (ERP) solution for the services industry. It leaves the domain of manufacturing and distribution to others, but that doesn’t mean it has limited growth potential. The company grew 38% year over year this past year.
Indeed, management at FinancialForce is betting big on the global, digital economy rapidly becoming a services economy. FinancialForce’s CEO Tod Nielsen is a firm believer in Marc Andreessen’s prediction and explanation of “Why Software is Eating the World.” That Wall Street Journal article was published in 2011. Now Mr. Nielsen contends, “Services are devouring the galaxy.” Today’s “everything as a service” (XaaS) environment is creating new, disruptive business models.
As noted in our prior report, the 2018 Mint Jutras Enterprise Solution Study found the vast majority (90%) of survey respondents felt there was some level of risk in their industry (and therefore their business) being disrupted. In the past much of this disruption would have been caused by the introduction of new, innovative products. But today it is more likely to come from new ways of selling/pricing existing products (think subscription to services), entirely new business models, or some combination of all of the above (Figure 1).
Figure 1: What is most likely to cause this disruption?
Source: Mint Jutras 2018 Enterprise Solution Study
Indeed, in many industries today subscriptions for services have replaced the outright sale of a product or service. This can have an enormous impact on the way business is transacted, as can entirely new business models – new ways that your old applications, including ERP, may not be able to accommodate. In the services industry, managed services and new technical services are often added to existing portfolios of service offerings. So how does FinancialForce address these challenges?
First of all, FinancialForce is purpose-built for services industries, which means it knows how to invoice and account for subscriptions and recurring revenue, in addition to the more traditional types of services delivered. In fact it prides itself on supporting “unlimited revenue models.”
SaaS + PaaS + IaaS supports XaaS
Having been born in the cloud, FinancialForce is delivered exclusively using a Software as a Service (SaaS) model. It is built natively on Salesforce’s Cloud Platform as a Service (PaaS) and is offered through Salesforce’s data centers using its Infrastructure as a Service (IaaS). This positions the company well in understanding all the nuances of what is rapidly becoming the “everything as a service” (XaaS) model.
As mentioned in our previous report, enterprise applications delivered as software as a service (SaaS) have the potential to deliver more innovation through more frequent updates. And multi-tenant SaaS solutions are the most likely to deliver more innovation, more frequently. FinancialForce is now, and has always been a multi-tenant SaaS solution, which means the company only has to manage a single line of code for any and all of its products.
But we also noted the speed with which innovation is delivered will depend a lot on the strength of the underlying platform. So how does the Salesforce platform stack up?
The short answer is that it stacks up quite well. The popularity of the platform speaks for itself. Also noted in the previous report, there is strength in numbers (of developers), particularly when you are reluctant to invest in your own. The more developers attracted to the platform, the more applications get developed, which ultimately can be shared. Features, functions and extensions have the potential to start to grow, if not exponentially, at least much faster than the typical linear sequence of development.
Salesforce is literally a “force” in the industry. The Salesforce AppExchange is the largest online marketplace of its kind, offering over 3,000 products built on a single, consistent platform. Salesforce estimates the platform speeds development by a factor of five, and cuts the cost of development in half. As a result, both solution providers and customers benefit. For a partner like FinancialForce, it means fewer wheels to (re)invent, by taking advantage of application services already built into the platform, including:
- Support for a multi-tenant SaaS environment
- A workflow engine, access and identity management
- Other rapid developer services include Salesforce standard user interface templates, (business) object orientation and built-in mobile support
- Support for collaboration through online chats (through Salesforce Chatter)
- Salesforce Communities provide a social channel, a public platform to encourage active engagement between customers, partners and employees where all can voice individual opinions, while encouraging more personal interactions, creating a deeper connection to brands
- Embedded analytics with Salesforce Einstein Analytics, a cloud-based data platform as well as a data-analysis front end designed to analyze not just ERP data, but also any third-party app, desktop or public data you bring in. And Einstein Analytics will also add the element of guided discovery.
The architecture of the Salesforce platform contributes to its success. In our previous report we introduced the concept of microservices. For the reader with a technical background, microservices, also known as the microservice architecture, is defined (by Wikipedia) as an architectural style that structures an application as a collection of loosely coupled services. For those nontechnical readers, think of it as constructing a solution from a set of Lego building blocks.
This is extremely important for any application that is “purpose-built” for an industry. A purpose-built solution is intended not only to satisfy the basic needs of any business, but also the last mile functionality specific to certain industries. This is the route FinancialForce has taken. It is not a horizontal, “one size fits all” kind of solution, but instead has been developed to address the specific needs that arise from being a services business. In today’s XaaS environment this often means subscription billing, recurring revenue and a host of other needs. Addressing these needs has resulted in further products (beyond financial management), including Services Automation, Subscription and Usage Billing, Revenue Recognition and Forecasting.
However, FinancialForce customers come in all sizes, large and small and many have selected a strong SaaS solution provider for the express purpose of not having to invest in information technology (IT) staff and developers. Of course, there are Salesforce and FinancialForce partners that can assist, but many prefer a more “self-service” approach.
The alternative to writing code is to use Lightning App Builder (Lightning), an intuitive point-and-click visual tool, which allows developers and business users alike to create data objects and business actions without ever writing a line of code. While Lightning provides an updated user interface (UI) with a focus on displaying data graphically, rather than relying on text and numbers, it is also more than just a UI. Lightning Experience is a new user experience designed to help you work faster and smarter. With the launch of Lightning Experience, the focus is on delivering a higher level of productivity with a re-imagined desktop. As a result, FinancialForce customer, Rich Tolocka of Phase 2 Technology, describes Lightning as a “game changer.”
“Lightning is a game changer. We now have a blurring of the boundaries between business systems, data and analytics. I can sit in one application and see backlog from Salesforce and actual and accounts receivable from FinancialForce. I don’t have to go into another tool. I could do all this in classic, but it didn’t really look right.”
Rich Tolocka, Phase2 Technology, FinancialForce customer
As a result, the Lightning Experience and the Salesforce Platform address two issues we raised in Leveraging The Power of a Platform for Enterprise Applications – the user experience and configuration/tailoring without invasive code changes. But the user experience today means much more than a pretty face or an intuitive, customizable look and feel. Web-based access for access any time, from anywhere has become table stakes today. Access from a mobile device is fast becoming table stakes as well. The Salesforce Platform takes care of both of these, safely and securely.
Now we need to turn our attention to other means of communicating and connecting, including advanced technologies like voice recognition and natural language processing (NLP). This is the user interface of the future even though few business users are asking for it now. But we also recognize that consumers never asked for virtual assistants like Siri, Alexa and Google Home. Yet once delivered, we all got hooked. At some point, the same thing will happen in the enterprise and solution providers that ignore this eventuality will be left behind. FinancialForce will rely on Salesforce to prepare for this while it focuses squarely on the new and ever-changing functionality required for the (still) emerging services economy.
Figure 2 depicts the current solution offered by FinancialForce and its ecosystem, including Salesforce.
Figure 2: FinancialForce’s Solution Ecosystem
Summary and Key Takeaways
In Leveraging The Power of a Platform for Enterprise Applications we suggested before your company makes a significant investment in enterprise applications, that you ask the tough questions about platform of any prospective purveyor of enterprise applications. For those of you in services-based businesses, we include those questions below, along with an abbreviated answer (in bold font) as it pertains to FinancialForce.
- Does it take advantage of the latest technology that has brought us into the digital age? FinancialForce is built natively with the Salesforce Cloud Platform, which continues to be one of the most popular and powerful in the industry. As a “force” in the industry Salesforce invests heavily to keep up with new and ever-advancing technology.
- Look carefully at the entire user experience, including mobile capabilities and other ways of interacting with the solution. The user experience is very subjective. We encourage you to try before you buy. It is not enough to see a demo done by the professionals, put your own hands on the solution and experience it for yourself. But rest assured Salesforce is investing heavily in mobile access and other technologies such as voice recognition and NLP.
- Is it a platform that supports configurability over invasive customization? Look carefully at the Lightning Experience. Ask for a demo. Don’t look just at the result, but demand to see how it is accomplished.
- Are analytics built in? Einstein Analytics from Salesforce is the vehicle by which these will be delivered. FinancialForce has already developed dashboards and datasets; analysis is completed in Einstein Analytics, with more investment to come, which will include artificial and augmented intelligence, along with external data feeds.
- What deployment options are offered? What is the vendor’s cloud strategy and is it conducive to providing innovation that is easily consumed? FinancialForce and Salesforce are both offered exclusively as multi-tenant SaaS solutions. The underlying platform is a Platform as a Service. All of this is conducive to more innovation, delivered more frequently.
- And finally… how popular is it? Will you be searching for developers or searching through a large marketplace of add-ons and extensions? The Salesforce Platform is one of the most popular development platforms on the market today and its AppExchange is the largest of its kind.
In today’s fast-paced, global, digital economy it is necessary to prepare yourself for the inevitable disruption. Don’t be complacent with the status quo. Recognize the threat and prepare yourself to take positive action. You may not be investing in developing the application, but the speed and volume of innovation that can be delivered depends on you selecting the right platform. If you are now or are becoming an active participant in the new services economy, FinancialForce is certainly worth a look.