How To Get Vendors To Share Their Plans
Tech users groups want more than help–they want strategy.
By Larry Greenemeier
InformationWeek
Jan 13, 2007 12:00 AM (From the January 15, 2007 issue)
Whereas advocacy groups like the Electronic Frontier Foundation will stand up to Congress over big-picture issues, business technology pros want someone on their side in their dealings with software and other vendors.
That’s where vendor-specific user groups come in. They began as a way for technologists to meet for training, networking, and direct contact with the vendors of the products they were using. That’s still the case, but with the Web’s ability to deliver tactical information, coupled with the growing diversity of huge vendors such as Hewlett-Packard, IBM, and Oracle, the groups spend more time pressing for vendors’ future strategy.
“Ten years ago, it was all about R3, how can I get a screen to work better?” says Rod Masney, president of the Americas’ SAP Users Group and global director of IT infrastructure services for Owens-Illinois, a maker of glass and plastic packaging products. “Now it’s all about NetWeaver, CRM, and other areas of SAP’s rapidly growing product line.” ASUG’s 50,000 members want to influence how those products are developed.
SAP doesn’t pick up the tab or tell ASUG how to operate, beyond its one voting member on a 13-member board. Membership costs a company with more than $5 billion in revenue $5,000 a year for an unlimited number of employees. The board meets annually with CEO Henning Kagermann, product and technology group president Shai Agassi, and global service and support director Gerhard Oswald.
The Independent Oracle User Group, with 20,000 members, has a similar independent model. That gives members the ability to be skeptical of promises Oracle makes for new features, release timetables, and security fixes, says Ari Kaplan, president of IOUG and manager of Datalink’s database practice. Hewlett-Packard, IBM, and most other big vendors have independent user groups, as well. Without financial independence, the groups wouldn’t be of use to members–or vendors, says Robert Catterall, president of the International DB2 Users Group and director of engineering for CheckFree. Says Catterall: “IBM values the straight talk they get from IDUG.”
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Oracle Offers New Licensing Model
Oracle wants to make its pricing model easier to handle.
The Redwood Shores, Calif., company announced its new pricing model on Dec. 19, one day after posting a 26 percent revenue gain during its second fiscal quarter. Oracle also announced that its profits grew 21 percent compared with the same period last year.
In offering a streamlined pricing guide, Oracle is trying to clarify the numerous licensing metrics it has inherited during a nearly three-year buying spree.
“With a number of pre-existing and newly acquired products, each with its own licensing metrics, Oracle’s new simplified licensing model creates consistency across all product lines,” said a statement released by the company.
Some of the company’s product that will be affected by the new pricing structure include applications such as PeopleSoft, JD Edwards, Siebel and the Oracle E-Business Suite.
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McKinsey on SaaS Trends
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McKinsey’s 10 Global Trends for 2006 re-visited
At the beginning of 2006, McKinsey predicted Ten trends to watch in 2006.
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BuildOnline and Citadon Merge to Create Global Software as a Service Provider
Filed under: Consulting Methodologies, Global Sourcing, SaaS |
Leave a Comment BOSTON, MA — (MARKET WIRE) — December 13, 2006 — Two leading providers of Software as a Service (SaaS) collaboration, BuildOnline and Citadon, have agreed to merge, creating the only truly global SaaS collaboration company. The merged entity will be known as CTSpace.
The SaaS business model has enabled both businesses to realize significant growth over the last eight years. The combined company boasts a global footprint serving some of the world’s leading multinational companies such as Balfour Beatty Construction Ltd, BNP Paribas, Chicago Transit Authority, IKEA and STRABAG.
CTSpace’s web-based collaboration, business process management and document management solutions allow companies to automate and streamline communications between departments, offices, companies, and countries — without purchasing costly hardware or software. The SaaS model ensures customers running business-critical projects benefit from a faster turnaround, increased accountability, reduced risk, and cost savings.
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Infrastructure Is Integral To Supply Chain Success
Filed under: Consulting Methodologies, Global Sourcing, Productized Services |
Leave a Comment According to AMR Research:
A company’s highest supply chain priorities are demand forecasting, supply planning, inventory management, and sales and operations planning.
Global outsourcing, leaner supply chains and the frequency of new-product introductions require substantially tighter collaboration and coordination among complex networks of trading partners. In response, corporations are building business processes, organizations and technology portfolios that allow them to manage this complexity and the ever-present uncertainty of supply and demand.
As supply chain managers build their technology portfolio to manage complex supply chains, the first issue they face is whether to buy application software from their enterprise resource planning (ERP) vendors (such as SAP and Oracle) or from independent companies commonly known as best-of-breed vendors.
ERP and best-of-breed vendors provide applications for demand planning, transportation and logistics optimization, warehouse management, multi-echelon inventory optimization, supply chain visibility and event management, global trade, and overall supply chain network design and optimization. The trend has been to use whenever possible the supply chain applications provided by the ERP vendor to reduce integration complexity and overall cost of ownership. In many cases, however, companies find that the functionality they require is either insufficient or nonexistent within their ERP systems. For this reason, best-of-breed supply chain software applications are still chosen to address the business requirements of their company or industry.
ERP vendors are expanding the breadth of their supply chain offerings and continue to gain favor in terms of increased market share. However, rather than coming at the expense of best-of-breed application providers, the data show that users are beginning to shift away from internally developed applications to packaged supply chain applications provided by ERP and best-of-breed providers.
In a recent AMR Research supply chain spending report, manufacturers report that their highest priorities for supply chain technology and process investment are demand forecasting, supply planning, inventory management, and sales and operations planning.
Companies are increasing their investments to either upgrade or buy new software. Budgets were expected to grow by 4% in 2006.
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Interest in SOA, SAAS Expected to Grow in 2007
December 26, 2006
By Renee Boucher Ferguson, eWEEK
For companies that use enterprise applications from the leading vendors, 2007 to some degree won’t offer many surprises. The top vendors—SAP, Oracle and to some degree, Microsoft—will continue investing in service-oriented architectures and will grow their investments in software as a service, according to industry observers.
All three companies will continue their investments in their respective next-generation ERP (enterprise resource planning) suites, with an underlying middleware platform: mySAP ERP, Oracle Fusion and Microsoft Dynamics.
SAP, of Waldorf, Germany, will offer its first completely SOA-based suite of applications for the mid-market, and Microsoft, of Redmond, Wash., will release Titan, its multi-tenant CRM suite for the mid-market. Both offerings have implications for end users. SAP’s hosted suite—the formal announcement is expected in the first quarter of 2007—could impact the mid-market, said Jim Shepherd, an analyst with AMR Research.
“SAP will announce a full mid-market ERP suite that is entirely SOA-based and all new code,” Shepherd said. “The question is if it is enough of a game changer where the mid-market buyer says, ‘I was going to buy [new software] this year, but SAP’s suite is not available until 2008. I’ll just wait and see.’ It could freeze the market. We’ve seen it happen before.”
Microsoft’s release of Titan will be more of a game changer for the channel, said Rob Bois, another analyst with AMR.
“Titan will send ripples through the indirect partner channel,” Bois said. “It has started to scare partners, but hasn’t fundamentally changed anything yet, and partners haven’t been forced to change. … All eyes are on Microsoft [to see] what role it believes SAAS plays in the channel.”
Infor, which has acquired 19 application companies in the past two years, could be the wild card in 2007 as it continues to buy other vendors. With a current roster of 70,000 customers, Infor, of Alpharetta, Ga., plans to increase revenue from $2 billion to $4 billion during the next 26 months—putting pressure on SAP, Oracle and Microsoft.
“It’s a different kind of model where presence in the market isn’t account control, but rather ubiquity,” said Shepherd. “That’s kind of the unique thing with Infor. They are quickly becoming best of breed.”
On the spending front, North American enterprises will significantly increase their cash outlay for new software initiatives and projects, said Ray Wang, an analyst with Forrester Research.
In his report “The State of Enterprise Software Adoption,” Wang states that enterprises plan to spend an average of 30 percent of their total IT budget of software related costs in 2007—licenses, maintenance, operations and development. The top software priorities for next year will be improving integration between applications (27 percent), upgrading security environments (21 percent), and adopting SOA (12 percent).
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Business intelligence software will represent the top application purchase, according to Wang, and ERP will remain the top major upgrade. Messaging, e-mail and collaboration software will lead the pack for minor upgrades.
SAAS spending will continue to increase among enterprises. Although medium and small companies (defined as those with 100 to 499 employees) lead as the current users of SAAS, 45 percent of Global 2000 and 32 percent of very large enterprises remain “somewhat interested” in adopting SAAS in 2007.
More surprising, according to Wang, among enterprises that use or are piloting SAAS, 54 percent of respondents named human resources as their biggest area of interest, and 40 percent named ERP, overtaking for the first time CRM (customer relationship management) as the biggest area of interest.
Salesforce.com, the poster child for SAAS, is expected to continue to grow in 2007. But it’s also the year wherein Salesforce.com, of San Francisco, can no longer point to AppExchange—its potentially game changing e-marketplace for third-party applications replete with a development environment, language and e-commerce engine in 2007—as an experiment. The company will have to start telling its story around actual numbers, according to AMR’s Bois.
“Next year [Salesforce] will have to say how much purchasing really happens from AppExchange,” he said. “That could take [Salesforce] from a software vendor with a nice idea to a pretty good software company. We still hear a lot of skepticism.”
A lot of the standard two-year SAAS contracts start to run out in 2007, which could lead to a brawl between line-of-business and IT as they work through maintaining “stop gap” SAAS implementations or replacing them with the intended on-premises solutions, according to Bois.
“I have a feeling that SAAS will turn out to be a longer term solution for a lot of businesses—more so than they had initially thought,” said Bois. “That will start to pan out next year. Customers will have a hard time justifying why they should switch.”
Check out eWEEK.com’s Enterprise Applications Center for the latest news, reviews and analysis about productivity and business solutions.
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NetSuite Rolls Out Employee Resource Management Tool
NetSuite launched Dec. 20 its Employee Resource Management product, designed to give employees the tools needed to self-manage and improve productivity.
With NetSuite ERM, employees will be able to file expense reports and purchase requests, keep track of project time, and retrieve human-resources-related documents.
“NetSuite’s new ERM capabilities make it as easy to manage employees as it is to manage the rest of your business, such as customer and vendor transactions,” Zach Nelson, CEO of NetSuite, said in a company release.
NetSuite ERM will feature NetSuite’s Employee Center, an on-demand self-service portal within NetSuite that will allow human resources management to share documents with employees that include information on benefits, job performance and reviews, company policies, new-hire information, and company holiday schedules.
“Now, they can empower their employees and managers with self-service and integrated expense reporting, as well as eliminating the red tape and cost of administering purchase management, time tracking and payroll through disparate applications,” Nelson said.
The new employee management software from NetSuite will also include a built-in approval workflow, enabling business managers to approve their employees’ expenses and purchase requests as well as their work time and expenses while also having the ability to view their company’s history of expenses and purchase requests.
When used with NetSuite’s integrated payroll service, employees will be able to manage vacation time and W-4s while also being able to view pay stub details.
NetSuite ERM is available now in NetSuite and NetSuite Small Business versions, by purchasing the NetSuite Employee Center, which is sold in five-user bundles starting at $49 per month.
NetSuite’s payroll service is sold separately, and the price is based on the number of users and payroll frequency.
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IT System Agility, Manageability and Cost Effectiveness to Drive the Asian IT Market Forward in 2007
Springboard Research, a leading innovator in the IT Market Research industry, today released its Predictions 2007 Executive Brief for what IT vendors can expect to see across Asia in the coming year. The brief was based on executive interviews with CIOs and IT decision makers at leading organizations across the region to identify their key issues and plans for 2007.
The full Predictions 2007 Executive Brief is available for free on Springboard’s website at http://www.springboardresearch.com.
“2007 will be an interesting year for IT vendors with fundamental market shifts being driven by Service Oriented Architecture (SOA), Software as a Service, Virtualization and the Mobile Workforce,” said Dane Anderson, CEO & EVP of Research at Springboard Research. “When combined with the emergence of Asia as a key engine for global economic growth, 2007 is sure to present unique opportunities to IT vendors well positioned to take advantage of the dominant market trends” added Mr. Anderson.
“CIOs and IT Managers are continuing to be forced to do more with less. Even when their budgets increase, it seems as if organizational technology needs are increasing even quicker,” added Ravi Shekhar Pandey, Senior Market Analyst for Springboard Research. “Companies in Asia will continue to increase their spending, but they will be more focused on serving business needs instead of being seen as just buying technology,” added Mr. Pandey.
This year’s predictions (more detail on each is included in the Executive Brief) include:
1. IT Vendors will see Service-Oriented Architecture guiding a larger percentage of their customers’ IT infrastructure investments
2. Virtualization will mature and come into its own in 2007, driving changes in hardware and software pricing models
3. Organizations will see a sharp increase in their focus on network-friendly applications
4. Windows Vista will stimulate IT buying activity, but mainstream adoption will be delayed in 2007
5. Software as a Service will see substantial gains in acceptance among Asia Pacific enterprises
6. Mobility will transition from being a secondary issue to a key element of enterprise IT strategy
7. 2007 will see an increase in the number of strategic partnerships in the Open Source arena
8. The SMB segment will continue its momentum in 2007, and increasingly turn to outsourced solutions
9. Indian IT service providers will come under increasing pressure from MNC providers
10. Indian IT service providers will be more aggressive with acquisitions, with one major tie-up expected before the end of the year
Springboard’s predictions are focused on the Asia Pacific IT market as a whole and are meant to provide an outlook at what we are seeing from decision-makers in the market. The 2007 Predictions Executive Brief is positioned to help IT vendors understand the changes and trends that Springboard believes will affect the IT markets in Asia in the future.
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Consulting 2.0 