Wednesday, October 21, 2009

Ranjan Das passed away.

OracAlum, and president of SAP India and Southeast Asia, Ranjan Das passed away yesterday. He was so young and so very talented, and such a great friend to so many. He was just 42 years old, with so many passions. He loved exercising, film, and his family and friends.

A statement was released by SAP that says:

SAP is deeply saddened by the news that our colleague Ranjan Das has passed away suddenly today. This comes as a great shock to all of us within the SAP family and is felt most profoundly by every one of us. We will be sharing more information once we have had the opportunity to further understand the family's wishes. Our deepest sympathies go out to his family, friends and work colleagues," said Geraldine McBride, president for SAP Asia Pacific Japan.

Das (42) had over 15 years of experience in the business software industry, eight of which were spent in SAP. He co-founded SAP xApps, one of the fastest growing businesses for the company. He also played a pivotal role in the early adoption of SAP NetWeaver, Duet, GRC, and e-Sourcing.

I reached out to his wife but have not spoken with her yet. I'm so sorry for the loss, and will miss him terribly. Hug your friends and family today (and everyday).

Thursday, October 15, 2009

SAP vs Oracle - quick thoughts after #OOW09

Well, Larry finally told the world about Fusion Apps with some details. And he did it in Steve-Jobs-like "Oh, and one more thing" fashion at the end of the last big presentation at Oracle Open World 2009.

There are plenty of analysts posting plenty of analysis based on plenty of briefings and facts and NDA's, and I don't feel qualified or compelled to add my voice to that chorus. However, I've been doing some thinking about SAP Business ByDesign (ByD) and Oracle Fusion Apps (FA), and what might be the dynamics between these two offerings in the coming year(s).

ByD and FA have been in development for a very long time. Both have had huge amounts of R&D investment in them. Both build on even more years of investment in predecessors, and both are meant to use that experience and expertise with a much more modern technology approach.

As it turns out, based on information from the analysts, both offer suites of functionality with some significant gaps as compared to more complete "current generation" suites, particularly in areas like Human Resources and Manufacturing.

From a technology perspective, FA appears miles ahead of ByD. FA appears to have a very clean SOA architecture with separate orchestration and business process management, pretty good user interfaces, nice social features, RESTful API's, and a more standards-based (e.g., Java) orientation. ByD, however, likely will have more functionality than FA.

ByD is targeting "the mid-market" customer, which SAP has described in the past as being from several hundred million dollars in annual revenues, up to somewhere around one to two billion dollars in annual revenues. ByD has been available for more than a year to a very limited set of customers, and SAP has been saying it will roll out ByD to a wider audience in 2010. According to Larry Ellison's presentation at OOW, FA will hit the market, coincidentally or not, in 2010.

FA is targeting a variety of customer segments, but one notable segment is the installed based for the "Applications Unlimited" (or "legacy") applications such as JD Edwards, eBusiness Suite, and so on - a very large fraction of these customers are in what SAP considers to be in the mid-market. These customers will be facing the end of life for their applications, along with a paucity of innovation associated with those applications and sky-high maintenance costs, so they will be natural candidates to consider a move to FA over time.

Some of the analysis written about FA has indicated that a move to FA from a legacy Oracle application will involve a complete reimplementation - some data will migrate, but the processes will likely have to be implemented "from scratch." Given that these customers will be facing a reimplementation if they choose to "upgrade" to FA, it seems likely that they will also consider alternatives to a move to FA. For example, they may consider staying on their current products, but going off maintenance or switching to third part maintenance providers. However, there is another alternative that these customers are likely to consider: moving to a new product potentially from a different vendor.

You can be sure that SAP will be visiting these customers and pitching SAP solutions to them. Given the timing, and given that many Oracle customers are in what SAP considers to be the "mid-market," ByD will be the solution SAP will pitch to many of these customers. And if Oracle pushes FA further "up-market," you can bet SAP will bring ByD there as well.

If SAP goes head to head against FA using the current Business Suite product line, Oracle will clearly make a big deal over technology advantages in every competitive situation. While ByD is not as advanced technically as FA, ByD will be SAP's best response to FA. For a while, large customers will be best served by SAP Business Suite or Oracle's legacy apps, as large customers will have many requirements that will not be met by the relatively immature ByD and FA. Thus, initially, it appears inevitable that Oracle and SAP will be going head-to-head with these two products. So, what will happen when these products collide?

I think the most likely scenario is this: ByD in 2010 will be made to work well in a SaaS deployment model, and FA will have quality issues and functionality gaps and internationalization limits. If this scenario plays out, SAP may be able to convert a significant number of Oracle legacy applications customers over to ByD (and/or perhaps SAP Business Suite) in 2010 and 2011.

We shall see ...

Monday, October 12, 2009

IBM vs. SAP and Oracle: part 2

Some correspondents have questioned whether IBM can really compete with SAP and Oracle in the applications business using the approach I hypothesized. Using an approach like BPM BlueWorks, IBM Global Business Services consultants can share processes (and the code to implement the individual "tasks" in those processes).

To put this in some perspective, IBM Global Business Services has 190,000 employees, according to Wikipedia. While not all of them are coding, bear in mind that this number is on the order of 10x the number of developers at Oracle and SAP. In addition, IBM has a large software division and research labs, also able to support the creation of these processes.

IBM need not create the basic financial and human resource core processes. They don't even have to create the basic objects and the processes to maintain the connections between those processes. After all, those objects and processes already exist, for most customers, in their current, installed SAP or Oracle applications. Those cores do not need to nor do they benefit from change, which is why customers are so loathe to upgrade their cores. However, customers desire additional, high value processes on top of those cores - this explains the success of Siebel and i2 in the past, and Salesforce and SuccessFactors and Taleo and Lithium in the present.

As long as IBM can keep those stable cores in place, IBM can develop high value processes as composite applications using WebSphere/Lotus without investing in core ERP. Fortunately, IBM has a practice in place to take over running your existing enterprise apps, guaranteeing a cost reduction every year, and without the large periodic upgrade costs of staying current with SAP and Oracle.

In summary, IBM will compete with SAP and Oracle for applications business, but not by trying to replace current SAP and Oracle instances (the way Oracle and SAP compete with each other), but instead by building on them as a platform.

Sunday, October 11, 2009

How IBM will compete with SAP and Oracle in the future?

Would you like to know how IBM will compete with SAP and Oracle in the future? If so, check out IBM's BPM BlueWorks site. Create an account, and make sure you read the terms of service:
By posting Your Content (or portions thereof) to the Community, You hereby consent to provide Community users the ability to download, print, distribute, perform derivative works or otherwise utilize Your Content.' ...The above licenses granted by You in Your Content are perpetual and irrevocable.
Community users may create derivative works and use them. In fact, you could imagine that IBM would create, under appropriate open source licenses, business processes in their BPM suite, and allow IBM Global Services or customers to use them, provided they run on IBM's BPM suite.

Customers already have such models, created as they implemented their current ERP products in use. Many customers created these models in tools like ARIS or Visio, and it wouldn't take much to migrate those models to BPMN, the standard and open language notation used and promoted by IBM - the notation used by IBM's BPM BlueWorks community.

What would happen if IBM's consultants used this tool, together with a BPMN tool from IBM, to create a library of processes (composite applications) that can run on existing enterprise applications? IBM would be able to build - and sell - these applications to many customers through their services arm. Many of these composite applications would implement high-value, cross-"silo" processes, such as recall management, financial modeling, sales and operations planning. These applications would be designed to be cross-platform, running the process in a BPM system but integrating into "legacy" SAP and Oracle applications.

IBM could either leave the "legacy" applications in place, or replace their functionality over time. IBM could even develop services to allow you to keep the legacy applications in place, managed by IBM at far lower maintenance cost than what SAP and Oracle want from you, and promise you a never-ending library of composite applications to help you drive business innovation from IT. In fact, IBM could promise - and deliver - such applications at lower cost, faster, and with more innovative functionality than SAP and Oracle. SAP and Oracle wouldn't even know this was happening until it was a real threat to their maintenance revenue, upgrade process, and new application sales.

So, is this just speculation, or is this what IBM has been doing now for a couple of years?