One of the most exciting takeaways from the Microsoft Fall Analyst session was a focus on One Microsoft as I wrote here.
Coming to their Convergence event in Atlanta this week especially with the backdrop of executive transitions happening in Redmond, I expected a bit of a regress to tactical messages. I expected more localized, VAR channel comfort zone talk and a bit of Magic Quadrant messaging and bashing of ERP and CRM competitors.
I was wrong.
Mike Erhenberg kicked off a pre-event analyst briefing spending nearly 30 minutes on the evolving Microsoft mission statement
Create a family of devices and services for individuals and businesses that empower people around the globe at home, at work and on the go, for the activities they value most.
In a one-on-one he spent some time on the evolving matrix organization and how different Microsoft units decide who takes the lead across various initiatives and the cross-unit meetings that are much more common than he has seen in his long Microsoft career.
The terms “devices and services” came up quite often during the event. That’s a crisp distillation of the 7 competencies Microsoft had identified in the Fall event (operating systems, machine learning, natural UI etc.)
Kirill Tatarinov‘s keynote (transcript here, I will add video later when it is available) had many subtle and not so subtle hints of a Microsoft in transition. He highlighted Microsoft’s infrastructure role at the Sochi Olympics. Customers like Delta Air Lines and New Belgium Brewing talked about mobile devices in their flight crew and “Rangers” workforces. The Lotus F1 team discussed sensory analytics from the race track and the use of the Azure cloud. In a customer panel which followed the analyst questions ranged from BYOD and mobile devices to Azure usage. Accenture , not one of the traditional VARs, was on stage during the Kirill keynote discussing digital enterprises. Judson Althoff, who heads Microsoft’s North American sales was on stage describing how Microsoft internally uses its CRM in another indicator of the changing Microsoft go-to- market. The core in each segment was about Microsoft apps, and yet so many other devices and services were prominent. In a later one on one with Trek bikes I heard about their use of Azure for Infrastructure and Platform –as-a-service and their device strategy.
In a conversation with Wayne Morris, Corp VP of the MBS unit, he talked about how many MBS VARs were evolving to also offer Office365 and other Azure cloud services. He mentioned collaboration between the Advertising and Online unit with the CRM unit as they work with digital agencies.
Probably the most reassuring aspect of the move to a more unified Microsoft is the new CEO, Satya Nadella who has rotated through several roles at Microsoft Cloud (Azure, Office365 etc.), Online Services (including Bing) and Dynamics units.
In my 2009 book, The New Polymath, I described examples of companies which were blending infotech, healthtech, cleantecth, nanotech to come up with a brand new set of solutions. The book had sections on Bill Gates’ various health charities. It had a section on Nathan Myhrvold, Microsoft’s former CTO, a modern day polymath with his wide range of scientific, gastronomical, archeological and other achievements. It had a section on Microsoft’s’ growing Azure data center investments and innovations.
Microsoft has for a while had on its board, Ford CEO Alan Mulally who is credited with turning around the car maker with its One Ford strategy.
So, all the building blocks have been in place to see Microsoft act like a New Polymath. One Microsoft, its own unique manifestation of the concept, is starting to gather steam.
Reading Spirit magazine on a Southwest flight I saw quote below from canine expert Cesar Millan
I think it is also a good way to think of innovation.
Too many back office and infrastructure vendors talk innovation when at the back of the pack they should be cautious and focused on threats – managing risks, on economics, on compliance. Their innovation should come in the form of cloud economics for the back office, analysis of newer business models, staying on top of changing cyber threats, privacy, compliance etc. They should be all over managing cost of IT. And vendors in this space should quit pretending they can deliver what the front of the pack can deliver.
The middle comes from many operational systems which should keep things running smoothly. Easy to say in our fast changing world it means looking at same day deliveries (maybe even same hour with drone deliveries?) , green computing demands on data centers, constantly shifting supply chains and a wide range of industry specific operational changes.
The front has to come from product and customer facing groups. My recent books have shown there is no industry or country where you can survive without ever smarter, IP enabled products and services. As younger consumers influence more buying decisions, there is intense demand to reengineer sales, marketing and customer service. As more machines enter the workplace, customer service has to evolve to support them.
Each part of the pack has a role to play. Problem is too many forget their roles, get too enamored with their roles and many analysts and partners in their spaces do them a disservice by not pointing that out and in fact encouraging them to be distracted.
Time (sub required) has a detailed story on the elite team that rescued the HealthCare.gov site. You can feel the intensity of the salvage project, the apolitical results-oriented approach while the mood all around the project was hostile, the relentless use of “stand up” meetings, the brainpower of A+ technicians many of who have helped many Silicon Valley companies scale and scale big. In a few weeks they offset the disaster that teams many times larger and at the job much longer had brewed.
You wonder what if the team had been there a few weeks earlier, how we would not have even heard about the complexity of the project. On the flip side you wonder what if the President had decided to scrap the project and start over – a very real scenario described in the article.
But the critical point the article makes is
“But one lesson of the fall and rise of HealthCare.gov has to be that the practice of awarding high-tech, high-stakes contracts to companies whose primary skill seems to be getting those contracts rather than delivering on them has to change”
The problem is its not just an issue in Washington. Most IT projects have mostly B and C players, many from outsourcers, when they promise the A+ players. And it is not just during implementation projects – it actually gets worse post-live. You have to look at costs of hosting and on-going support of most enterprise apps to see how bad the problem is. Bring an elite team in, and within days they could easily identify ways to cut costs by 50-90%. Trust me that is even less like going to the moon.
“If you haven’t spoken to your retail customers about the Target breach, I recommend you do so immediately. You can bet that they’re reading up on the breach, have all sorts of questions and concerns, and are probably getting solicitations from other solutions providers promising to make them safe and feel secure. Next, offer to improve their data security by using antivirus tools, firewalls, and smart network design.”
Seriously, how many VARs know about the specific variant of the POS virus that is speculated to have been involved, especially since Target has been tightlipped and how many can deliver the A+ quality that could have prevented or quickly limited damage to the tens of millions of cards compromised?
We have to quit encouraging firms whose “primary skill seems to be getting those contracts rather than delivering on them”. As buyers, as industry observers, as vendors.
Lots of press like this around Delta’s decision to change its frequent flyer program starting in 2015 to reward dollars spent versus miles flown. Same thing happened with Southwest similar change couple of years ago. As I I approach the 3 million lifetime mile threshold with Delta, and with most of us in tech on the road so much, it should be a welcome change for business travelers.
The reality is as I wrote in 2012 and many readers commented most of us have learned the game. Those miles come with way too many strings attached and when you try to cash them – well, as I asked a Delta rep a few years ago “would you keep investing in a currency which keeps depreciating in value?”
In my opinion, the airlines have way too inflated a view of the importance of frequent flyer miles in our decisions. Non stops, newer equipment, comfortable seats, reliable wi-fi, on-time performance, not being greedy with fees are far more important considerations these days. One reason why after years of positive relationship with Southwest, several issues last year have taxed my loyalty to move half my budget with them away this year.
Now my daughter, as she ramps up her travel days, is much more into the mileage discussion. But she remembers the more generous times in the 90s when the family would go to Ireland each summer on Delta miles. Those days are long gone, as she is starting to find out.
InformationWeek has kindly run a column on the new book The Digital Enterprise. My basic premise is IT has become fun and profitable for most of the companies we interviewed for the book. The reason is they have moved past systems of record and even systems of engagement and are focused on systems of advantage.
During the edit, they dropped for reasons of length some other examples I had included in the column. They included:
Celso Guitoko, Global CIO at Nissan Motor, described the “steering-by-wire” and electric vehicle innovations their technology investments are enabling.
Echo Entertainment described how its casinos in Australia are exploring digital technologies such as RFID and facial recognition to provide better customer service.
Magne Frantsen described the Statoil Management System the company uses to manage safety and promote operational excellence across its massive exploration assets in the oil and gas industry. Optimized for its North Sea operations, the system is evolving to support the fact that 70% of its production is expected in 2020 to come from vastly different sources such as shale fields in North America and CO2 injected gas fields in Algeria.
Several executives talked about how customers increasingly expect personalization, so they'll have to embrace new marketing and production techniques around mass customization and agile shop floors to support it.
Of course, this is just a small sample of what the 350+ pages in the book describe. Other customers talk about complex event processing, agile robotics, semantic product memories, wearable computers, 3D visualization and many other technologies they are leveraging in their industries.
Download a Kindle version for only US $ 3.99 or EU 3.99 and read about the systems of advantage these companies are creating . And feel good doing so - Software AG is donating net proceeds to charity. Enjoy!
My blogs are celebrating their 9th birthdays – Deal Architect this month, its younger sibling New Florence in March. Together, they represent my longest “book” – 9,000 posts long.
It’s been quite a run. In many ways they are ying and yang. Deal Architect is punchier and reflects the voices and disappointments of many of my consulting clients about the pace of and payback from enterprise technology. New Florence is pure joy as I catalog innovation across products, places and projects.
In the earlier years, Deal Architect had an unfair advantage because my consulting practice and social network call signs used the same moniker. Also, enterprise readers used to have a narrow view of innovation and thought New Florence was too removed from their world. Boy has that changed, and in a sign of optimism for all of us that innovation is accelerating around the globe, New Florence has been growing at a faster pace than Deal Architect both in content and audience the last couple of years.
Blogging has brought me so many benefits
Readers from around the world – a pleasure to meet many of them during my travels
Many new friends including the Enterprise Irregulars, a group that came together in 2006
Fodder for 3 books I have worked on since 2009
A chance to invite many casual writers to guest blog. I am especially proud of the 2009 and continuing in 2014 series where nearly a hundred folks have written about how science and tech have helped evolve their passions and hobbies
An introduction to many obscure industries and places around world which constantly make me stop and go “wow”
I have so many people to thank
My sponsors who have been immensely supportive while respecting the independence rules I have laid out
Countless technology and other companies who keep me informed of their products and invite me to their events
Typepad, my blogging platform, which has performed without hiccup and at very reasonable investment. While many professional bloggers sneer at it, I challenge anyone to show me many service providers which could match the cost and service levels I have received.
Tools like MS Windows Live Writer and Bit.Ly that have helped format then compress addresses for thousands of the blogs
Google for bringing readers sometimes years after a blog is posted and from places farther than the mind could imagine would be interested in a post.
Facebook, Twitter and LinkedIn for allowing me to share these posts with a changing set of communities.
My parents for the DNA with the C – curiosity – chromosome which makes me look at and admire so many things others find not so interesting.
And again, my loyal readers
Look forward to your continued support as we march to the 10 year, 10K milestone. Thanks again.
One of the most closely watched metrics at the annual NFL Scouting Combine this time of the year is each athlete’s 40 yard dash timing. At the MIT Sloan Sports Analytics conference last year a panel decomposed that metric. How few times in real life play does a player get to run 40 yards uninterrupted? The first 10 yard burst is way more important. Speed/strength after contact at 10 yard point is way more important. It was fascinating to listen to this because slight variations in the 40 yard metric can affect which round a player gets drafted in and affect millions in his contract value.
Frank Markus has been writing for years about technology for Motor Trend magazine which constantly calibrates a whole set of metrics on many cars. He recently wrote an article titled “Surrender” and says “Engine control computers know pretty well how much fuel they're metering through the injectors, but that information is not publicly shared on the CAN data bus. Even when we've invested in unlocking the rich OBD data stream, we've found it difficult to capture accurate data except during steady-state cruising, and obtaining that rich data for every (sometimes preproduction) car is impossible.” Now abstract that many layers higher and see how imprecise the MPG, emissions and other data auto salespeople use and we as consumers take for granted from the car sticker.
I have been enjoying the fact that my FitBit tells me I have been working away 2,500 to 3,000 calories a day. My weight has dropped a bit, but I got a rude surprise in the men’s store recently. The salesman said I should be asking for “executive cut “ (ahem – you know what that means) not just 42 or 44 Long in my blazers. He laughed when I asked for the classic Brooks Brothers cut. Mea culpa – I should have read this 26 slide GQ guide to suits which shows a wide range of lapels, tapers, vents and other jacket features the tailoring world has been improvising
My point with all this is over and over in our personal and business lives even as we are into “quantified self” metrics and Big Data projects we are anchored around a handful of old-faithful units of measure. We benchmark by Yahoo finance metrics and Hackett process metrics and the underlying world has changed so much. Part of good analytics is to challenge sacred cow measures like that panel at the MIT conference was doing.
My wife says I am an impatient man. She has not seen me in meetings where I hear of enterprise vendors talk about integrating functionality they acquired years prior or ERP rollouts that go on for decades it seems like.
Actually my impatience is dwarfed by the C level impatience I am seeing these days in so many companies .
It prompted us to include a chapter titled “Rethink Speed” in the new book The Digital Enterprise where we included several examples including the Samsung Galaxy
Samsung introduced the original Galaxy S in 2010 with a 400 x 800 resolution screen and a 5 megapixel camera. Every year since then Samsung has produced a new generation of Galaxy phones with improved specs. The S4 clocks in with 1080 x 1920 resolution and a 13 megapixel camera. In every other dimension including CPU speed, memory, battery life, and number of sensors, each generation has exhibited impressive improvements over its predecessors.
Continuing that cadence, Samsung introduced yesterday the S5 with even better specs and new functionality for the growing “quantified self” audience.
C level executives may admire the Galaxy for their personal use. They are petrified of what Samsung may do with products in their sectors.
Hence their impatience. Far, far more demanding than mine about years of enterprise integration and rollout projects.
In the analyst/blogger/media world we have periodic flare-ups of “who’s more independent”. Nothing gets resolved but a few weeks later it flares up again.
Independence to me represents many shades of grey. When I joined Gartner from Price Waterhouse I asked about the independence forms I needed to sign. At accounting firms you had to annually disclose (and often divest) investments where the firm had an audit relationship. At Gartner the rules (at least in the 90s) were much less formal. On the other hand accounting firms were helping on all kinds of software evaluations and not disclosing to clients their implementation revenues from specific software vendors. Was one more “independent” than the other?
It’s a buyer’s judgment call. I have always respected clients who do quick diligence around my firm’s independence. That’s where the call needs to be made. To help them we have an independence policy for our blogs and all our sponsors have badges on the blogs for all to see.
In turn, we vet potential sponsors and the vast majority are by my invitation. Our sponsors, in turn, have been meticulously respectful of our independence. They know not to ask us to influence any buyer consulting engagements. They also do not ask for any confidential information from competing vendors. If you are planning a commercial relationship with my firm, I am always happy to have a thorough independence discussion.
On the other hand if you just want to glibly just talk about bias or about lack of independence as some vendors or analysts like to do, I wish they would in our age of Big Data run analytics on my 8,000 searchable blog posts over 9 years. And if they persist with their idle talk, don’t be surprised to see me tweet “If you are convinced we operate that way, how dumb are you to not spend a small amount on sponsoring our blogs?” That usually shuts them up.
There are so many amazingly positive visuals of Apple. Customers leaping for joy after they have lined for hours outside a store for their new device. My kids when we traded their Blackberries for iPhones. My kids and wife when they traded their Windows laptops for MacBooks (I am sole Windows holdout in the household). My wife as she walks around the house with YouTube on her iPad. Her store experience as she goes for training there. My eyes as my magazine and book reading has migrated to the iPad mini. Do I sound like a fanboi?
Actually over the last year I have been annoyed by some un-Apple like behavior
a) the seemingly un-integrated CRM system they appear to be running
b) The Lighting to USB cable – one that BusinessWeek asked about “Is this Apple’s worst product?”
When we bought our iPhones each came with a cable in the box. I bought 6 extra – for our cars and our travel. Well, given our young and mobile family and our friends the cables started to disappear at a rapid clip. At $ 20 a pop, like most parents I looked for options. Found some at Amazon for under $ 5 for the cube adapter and the cable.
Then word started spreading the knockoffs were an electric risk and I saw Apple’s offer to trade them in for $ 10 each. I took 4 adapters and cables to their store. For each I was emailed a Genius Bar reservation. I thought that odd but the appointments were sequential so did not pay much attention.
The store rep asked me where the associated devices were. I said with the family members who are at college. He said I needed to bring them in so he could get the serial numbers. I said surely Sprint registered them and they are in your CRM system. His response – not easily available to us in the store. After a while in the back room, he said he found 3 in the system so could only trade 3. His supervisor later intervened and offered to take all 4.
He also said the offer only applied to the adapter not to the cable. I asked if Apple knew only the adapters were causing the problems. He did not know but could not trade the cables.
I sent a letter to Apple HQ asking why the cables were not included in the offer. In their customer service process store questions are referred back to the store. The store manager called and left me a message “I remember you from your visit. I think we took care of your problem”. No further follow up. Another CRM failure.
A few weeks later my daughter’s iPhone power button had problems. The store initially told me her AppleCare did not cover that. Then they told her they did not show AppleCare associated with her phone – more CRM system issues. When I dug up the paperwork, they gave her a new phone.
Bang – she must have synched her new phone with one of the knockoff cables we still have and it shorted her MacBook. Back to the store and they said they were having many such issues. Four months ago I was told the problem was with the adapters not the cables.
With iOS7 Apple has added warnings if you try to use a knockoff cable. That’s certainly progress but it does not fix their CRM issues or the likelihood that at $ 20, many parents will continue to be exasperated and a new wave of knockoffs will surely keep showing up in the market while many old ones are still out in the wild.
OK, so I admit. I write books about Digital Enterprises, I prefer digital banking, mobile travel sites, GPS navigation over paper maps, self service airline check-in and grocery store check-out.
I will take a digital route way before a paper/people/process heavy route. That conviction just got shattered in a big way. No one to blame but myself.
I do not have to deal with the Indian consulate too often because they issue 10 year visas. But past experiences with the Houston branch have been miserable. It used to be a black hole – send your passport in and weeks of checking, groveling later the visa arrives. Once I was on call to the State Department to try and get a replacement passport because the Indian consulate was so unresponsive.
So, I told my wife in early January I would fly to Houston and get the visas done in person this time. I had a trip coming up in March and that seemed sufficient time to get our visas. I could have used an outside agency to process the visa but past experience has not been consistent so I prefer to deal with consulates myself, unpleasant as that experience often is.
Glad I did not fly to Houston. Turns out our jurisdiction has been moved to a new Atlanta Indian consulate. I actually cheered – maybe the newer consulate is more efficient and besides, it is a shorter flight. Then someone told me the visa process had also been outsourced. I presumed that would be even better, and checked their site and found on-line applications and a passport/visa tracking workflow. My digital brain was sold!
Wish I had done some research on the outsourcer, BLS – I would have found horror stories as in this Change.Org petition.
Instead I merrily started filling out the on line application for both my wife and me. The on-line application was a UX misery. 3 pages of data which the consulate should already have had. Truncated fields for questions like all countries travelled to in last 10 years. Multiple captchas. Took me 2 hours to do mine. Having made mistakes on mine, my wife’s took a bit more reasonable 30 minutes.
I should have also gathered by now the process is barely digital because I needed to go to my bank to get money orders (BLS has not heard of PayPal), AAA for photos (in fairness the BLS site does allow digital photo uploads, but knowing how fussy consulates can be I was afraid to send in selfies) and 3 trips to my local UPS store. 3 trips to UPS? Yes, once to get them to interpret the 3 pages of shipping instructions (not kidding), second when the online application required the shipping bill info (so glad my friend Scott Galloway runs the local franchise and did me that favor and pre generated that for me) and third to actually ship the documents. Separate package for each of us with tracking info taped on front of package (hello privacy concerns : the label the BLS site generates has your passport number for every UPS employee to see).
Anyways, the applications were done. UPS tracking showed the packages delivered. BLS’s tracking site below showed applications received January 16. My digital brain relaxed.
On Sunday, January 19 I received an email from BLS saying they needed proof of residence. I was impressed more than annoyed. An email communication on a Sunday? Yes, things were surely moving. So I went to post office and mailed them a copy of my driver’s license.
This is where a parallel analog process started. While our license copies were in transit to them, they physically returned our passports with the same request they had emailed. Why, oh why? So we basically started again and out of abundant caution I included a second set of money orders. I included a note asking for the second one to be refunded. The costs were piling up - $ 600 in fees, $150 in shipping charges, time at bank and UPS. Still, we had only lost a week so far and the process appeared to be somewhat digital.
No updates for next couple of weeks. The Atlanta BLS office has a phone number of its site. 4 phone calls to it have always resulted ending in an unnamed, and always full, voice mail box. However, my wife’s visa arrived digitally unannounced on February 6. Mine did not. That started a flurry of phone calls and attempts by friends in New York and elsewhere to track status of my passport.
On February 10, I finally talked to a BLS employee. He asked me for a copy of a revoked passport and fortunately agreed to accept a scanned copy. He emailed me back that the visa would be done by end of week. If I had not managed to talk to him I had a reservation to fly that week to Atlanta to get some personal attention at the BLS office. That would have added another $ 500 in costs.
End of week came and went. No passport. My client who wanted the trip to India told me they could only wait couple of days more. So now with even more urgency I tried to call BLS. I emailed multiple times the employee I had talked to week before. No response. Call center calls kept disconnecting due to volume of calls. My troops in New York and elsewhere also jumped into action by going to local BLS offices to see if they had better luck reaching the Atlanta center.
On Thursday I finally managed to get someone live in the BLS call center. Passport should be with you Friday they say. An escalation ticket I had opened on BLS site results in email with same info. Neither told me if visa had been issued. More suspense till the UPS package arrived.
I now have the visa but the client has cancelled the trip to India. At least I have the passport for a trip to Germany in early March.
BTW, the UPS tracking site shows my passport delivered. The BLS tracking site still shows no updates since January 16! And just to highlight the random nature of the process - my second fee came back uncashed. My wife's did not.
My faith in digital processes has become a bit more cautious. I will keep the bar code sticker from the consulate on my passport as reminder just because a process uses scanners and other technology does not mean it cannot be polluted by useless analog steps.
WhatsApp valued at $ 19 billion for 450 million users. In Asia, another text messaging service, LINE has another 300 million users and is expected to IPO in Japan this year. Facebook at $ 175 billion for 1.2 billion users. Twitter at $ 30 billion for 650 million users. Netlfix with original programming. YouTube as major channel. You can go and on.
As we celebrate on March 10 the 138th anniversary of Alexander Bell’s first ever phone call, it is pretty clear the world of communications and content has changed massively. Telecom and cable executives worldwide should be watching with intense jealousy at these valuations and even more intense concern at the (mostly) young and non-paying demographic of these new services.
They have seen it coming, and yet they still compete on speeds and feeds and continue to annoy customers with long-term contracts and sneaky charges. And keep acquiring each other with the hope they can continue to squeeze more out of their old models.
In my 2009 book, The New Polymath Martin Geddes, an ex BT exec had sent out an SOS to telcos with words like
“ The Internet is still so young. I am more worried about the next generation of Googles and Skypes, which will be far more terrifying. ”
Five years later he sounds so prophetic …and yet the telcos have not evolved much – at least in consumer markets
Katie Nittler. the latest contributor in the Tech in my Passion guest series, writes me “The column looks great - it was so much fun to do - thank you for thinking of me! Let me know when you want another one as I have a few in mind!!!”
Most of the contributors below have multiple interests. I am in awe of their ability to hold down demanding jobs and yet devote time to so many of their passions and hobbies.
Enjoy their zest for life and the science/tech they describe which allows them to enjoy it even more
I have a feeling Kirill Tatarinov, EVP for Microsoft Business Solutions, is going to have a more nuanced version of this statement come March 3 at his conference in Atlanta
“No-one has done cloud ERP!”
I bet Zach Nelson and Aneel Bhusri and Jason Blessing and Steve Miranda disagree with him – some more vehemently than others.
Actually Kirill explained Microsoft’s differentiation better in another answer
“There is one very large organization that I spent a good chunk of time with last month. In all the discussions we’ve had, we haven’t even talked about the mode of deployment. We’ve given them the assurance that it will run on the Microsoft cloud and that they can put it in their data center.”
With many of the Microsoft VARs offering their own private clouds, there is yet another flavor he can offer.
Which is why he can point out at least some European organizations are spooked by the NSA disclosures. But even they are looking at regional clouds, not dismissing public clouds completely.
Actually his new CEO, Satya Nadella, fresh from his successful Office365 launch will likely join Zach and Aneel and others in suggesting a bit more of a nuanced answer in Atlanta:)
Couple of years ago I asked SAP to take me off their events list. I kept asking questions and not really getting answers from its executives and I felt like a jerk writing lukewarm or negative blog posts after being a guest.
I have also reduced my SAP coverage on this blog, but find SAP has become even more removed from the questions I have been asking. As I recently told a friend at SAP “(You) may have moved on newer stuff like HANA but your customers are 98% in the situation they were in 3-4-5 years ago. They still pay SAP and partners $ 50 billion+ a year. They may not be bitching to you as much but they have in many ways given up on SAP and are back to custom development and buying from others. So what they tell me forces me to not forget the past - because it is still the present”
Unfortunately I sound like a broken record and everything I do write about SAP just riles its very proud supporters. You have to admire the intensity of their commitment to SAP but it leads to needless arguments on social media. That’s time better used for my innovation books and blogs.
So, I will not post about SAP on this blog any more. Readers, there are plenty of blogs and tweets from SAP fans which will keep you informed.
As I have done for 25 years, I will continue to advise consulting clients about SAP matters. I will also continue to profile interesting and innovative use cases that come out of the HANA customer base on New Florence.
I read this morning an Apple fan’s uncharitable view of Google and it occurred to me we all spent so much time on Apple v Microsoft, Oracle v SAP, IBM v HP type gossip, that we forget all the good technology work that is being done in corporate settings.
Well, in my small way, here is my counter balance – a column on Sand Hill celebrating the corporate technologist.
It will get a much smaller set of page views than the Apple/Google column, but you know what – last time I checked much as I admire both of them my car, my home appliances, the planes I fly and most other things in my life come from a very different set of suppliers – and I am more than happy to acknowledge all the innovations they are delivering.
Sorry, Aneel and Marc but if someone were to ask me the most exciting event in the last decade of software, cloud enterprise applications would come in second. The phenomenonal growth of consumer mobile ecosystems would get my first ballot. Thousands of apps and new entrepreneurs, millions of customers, billions in volume and revenues.
So, it is exciting to see an enterprise vendor like SAP emulate that consumer tech phenomenon. It says it has grown its HANA startup ecosystem to over 1,000 startups in 55 countries in 18 months. If it follows the trajectory of the iOS and Android stores it could be hugely transformative to SAP’s traditional big elephant sales, big SI go-to-market model.
But that is a big IF.
Here are some caution signs along the way:
Can SAP learn to price to sell?
You could argue iOS and Android apps were underpriced. Indeed an entrepreneur told me about Steve Jobs: “The greatest trick the devil ever pulled was convincing developers to sell their apps for 99 cents” SAP on the other hand comes from the other end of the spectrum. Its legacy ERP ecosystem is the costliest in the industry – storage per gb, support costs per user, upgrade costs etc. Over the last couple of decades, SAP has been unable or unwilling to police its ecosystem. As an HANA entrepreneur I would smile and go “what’s wrong with that?” As a customer I would go “Will history repeat?”
Is the analytics platform space overcrowded?
4 years ago when SAP started pitching (the predecessor of) HANA it looked differentiated in the in-memory analytics space. Today that landscape is much more crowded with Vertica, MongoDB, Cassandra, Netezza, Amazon RedShift and countless others chasing the Big Data market. The vertical focus of many HANA startups like FeedZai’s on credit card fraud and NexVisionIX on retail will clearly help them – but the underlying platform is not that exclusive any more
Is analytics too narrow a focus?
The smartphone camera, accelerometer, GPS chip, Bluetooth capabilities each led to a wide range of photo, navigation, wellness and other apps categories in the Apple/Google stores. With HANA, the analytics focus while hot today may not be broad enough. Customers are looking at telematics, robotics, countless other areas beyond advanced analytics in their innovation areas.
Can SAP resist the marketing temptation?
There is also the risk that SAP will duplicate its track record with its communities. The millions of SCN and SDN members turned into potent marketing machines with their blogs and tweets. Most customers on the other hand could not really articulate the value of the communities. 1,000+ HANA entrepreneurs could be used similarly when the real proof point should come from extent of customer adoption and related revenues
Personally, instead of startups in 55 countries, I would have loved to see just 55 startups with several million of revenue and capital by now. A 1,000 + startups (already) must be taxing SAP’s resources, not to mention the scrum for capital which you need plenty of for enterprise class (compared to iOS) apps.
So it will be fascinating to watch how this ecosystem grows over the next few years and how it morphs SAP along the way.
It’s been a decade but I still remember it vividly because I was so shocked. An American Airlines supervisor refused to let me stand by on an earlier flight because as he put it “You are not our customer. The ticket belongs to Travelocity”. The fact that American got 90+% of that ticket value or that American could have likely sold my later, prime time seat at higher revenue did not seem to matter to this man. The earlier flight took off with an empty seat and I think I have flown American only once since – and only because Delta cancelled a flight and put me on American.
We live in an omni-channel world these days. Retailers allow us to buy on-line but pick up items at a local store. Amazon uses plenty of affiliates. We deal with each other via email, phone, Twitter, Facebook, LinkedIn etc etc. Channels naturally come with conflicts but rare is an experience like I had with that American employee.
Till, that is our recent experience with Holland America Lines.
My wife and I saw a Holland cruise starting on December 18 . It was different enough and short enough to leave our aging dog while the kids were on holiday from college. The Holland website would not allow us to book it directly and sent us to its agent, Affordable Tours, who booked it for us. We also tried to book insurance through Holland and were told to go to the agent again, and we booked trip cancellation with CSA. I should have known by now we were going through the American experience - We want your revenue, but you are not really our customer.
Our dog got sick around the 11th and progressively got worse (he passed away on 19th). I reached out to Holland via Twitter, and got no response. We posted a request on its Facebook page. It must mostly be monitored by fans, not employees and we got unwelcome suggestions like “Be a responsible pet owner -- if your dog is dying, put him down and go on your cruise. Why let the dog suffer?” For someone who has never known our dog who was a long term part of the family, I thought it was awfully insensitive and was surprised Holland employees did not intervene. I guess more of the “he’s not our customer” attitude.
One of their employees suggested we call their contact center. When I did the agent basically told me since we had booked through an agent we would have to deal with them. When I told her we had tried to book directly with Holland, she hung up. Not kidding.
I went back to the Affordable (who was helpful throughout but it must take them days to get responses from Holland) and asked if we could send our kids instead. She got word from Holland we could swap one person for an additional $ 140. When I said neither of us wanted to leave a dying dog she said Holland only allows one passenger change. She suggested we cancel and she would try to get a future cruise credit from Holland. We agreed and told her to cancel but have not heard from her again. CSA told us that was not a covered event under their policy but did refund our premium.
I naively sent a letter to the CEO Stein Kruse expecting a somewhat better response. The response from one of his staff “we are sorry to know your travel professional (italics mine) did not….”
And she makes this wonderful offer “a Special Upgrade …on a future cruise”
Seriously, Holland you think we will send more revenue your way? After neglecting nearly 10 opportunities to treat us like a customer?
The world is going to keep getting more and more channel-fragmented with the associated conflicts. But a simple rule of thumb has never changed - if you get the majority of the revenue from a transaction, learn to take charge.
Starting on January 13, there has been a gallery of 15 guest posts on New Florence about how science and tech are evolving people’s passions, hobbies, interests. Even more impressive few repeat the ones from the similar 2009 series.
Please enjoy each and if you have an interesting work-life balancing activity, please consider contributing. I will help you embellish your draft.
Next month, the New Florence blog will celebrate two milestones - its 9th birthday and 4,000 posts. Add to that the 00s of hours of my consulting and book case study interviews and I have a nice database to analyze for patterns.
NF is categorized by nearly 50 topics from Data Visualization to 3D printers and I periodically summarize the global sources they are coming from, but even more interesting is to see the “entities” they are coming from. It is a constantly shifting kaleidoscope – but here is a loose categorization.
Large technology vendors – 25%
Amazon, Apple. Google, Microsoft, HP, IBM, SAP etc etc …get plenty of media and analyst coverage which should suggest they get the majority of NF posts. Actually they make up only about 25% of this blog’s coverage. When you look at innovation projects at (business) customers the tools of these vendors are usually too horizontal or too expensive to make too much of a dent. They have much more impact on back office and infrastructure IT. NF does like to write about the operations of these vendors - their supply chains, their data centers etc– and how they are themselves innovating. Of course with their sprawling portfolio of skills, these vendors can pull together machine learning. cloud infrastructures and other assets which allow them to create standout solutions, just wish they did so consistently.
Large non-tech companies – 25%
Ever since my 2011 research for The New Technology Elite where I cataloged 75+ industries which are embedding technology in their products and services, this blog has cataloged product, process, marketing and business model innovation at companies like BMW, Corning, Delta Airlines. GE, Keurig, Lego, Siemens and countless others. Most bloggers and media find this innovation boring or difficult to categorize in their market TLA classifications. Still others in an honest moment will tell you they don’t make any money from these companies so feel little incentive to profile their innovations.
Fast growing vendors – 15%
This blog has cataloged a number of SaaS/cloud and mobile vendors over the years. Entrepreneurs and VCs in Silicon Valley and elsewhere provide a steady diet of posts. It is a joy to see firms like Workday and Appirio and HireVue and FireEye evolve and thrive years after I first write about them. Often a trip to Toronto or Lexington, KY will allow for opportunities to profile local tech communities. I also like to stay in touch with VARs who keep expanding their portfolio of products into innovative POS, collaboration and other technologies for SME customers who typically have light internal IT capabilities
SME non-tech customers – 5%
I find the German Mittelstand – its ecosystem of mid market companies – fascinating and profile companies from there and often similar ones from Japan, Poland and elsewhere. Ditto with creative and artisanal communities in the US, Italy and elsewhere.
Academia/Research Units – 5%
Basic research at several universities, at labs at Microsoft, GE, elsewhere and papers from professors I meet through book research and stay in touch with provides a bit of a different and forward looking dimension to the blog
The “Calendar” – 10%
Events and holidays which repeat every year like the State of the Union speech and St. Patrick’s Day and those that repeat every few years like the Olympics provide a steady stream of posts. The changing technology and design thinking provides a nice timeline of innovation and our zeitgeist – the changing spirit of our times.
Personal Life – 10%
The guest series I ran in 2009 and am running again this year where people talk about how science and technology is helping evolve their passions/hobbies provides a fascinating glimpse of how pervasive technology is in life. As houses and cars and clothes get “smarter” they provide plenty of other posts.
Unexpected Places – 5%
Search the blog for Estonia, Dubai, Singapore and you will see plenty of posts. Uganda and Ukraine have far fewer but the blog likes to also profile what may appear low-tech but helps evolve life for its citizens and qualifies as innovation.
The percentages I have above change quite a bit from year to year as companies and regions ebb and flow with their innovation output. But when I hear people complain they see innovation slowing down, I tell them they are not looking wide enough. I am part of many communities across these areas and unfortunately folks in each believe they are the only innovative people. I also see too many analysts and bloggers cling to their unique market segments be it CRM or data centers and “project” innovation from that view out.
The NF pace of posts keeps accelerating. Based on average of 100 posts a month in last few months, New Florence could have a 1,000 post year. In contrast, the first 1,000 posts took the blog 3 and a half years to achieve. And this pace accelerates even though my definition of what qualifies for including on the blog keeps getting much more demanding.
9 years later with this wave of relentless innovation I am even more convinced this is what Florence must have felt like during the European Renaissance and glad that I named the blog what I did.
I read this week Klout “is evolving from a service that told you how much influence you had in terms of a numerical value, to a service that now tells you why you’re influential and how you can improve on that”.
And my reaction was did the Klout score ever accurately quantify “influence”?
5 items from this week should explain what I mean
I ran into Ron Hanscome, Gartner analyst at Oracle HCM World. Ron, knowing I would understand as an ex-analyst, said the HR tech market is hot based on a metric of client queries he is measured on. Few people outside Gartner get to see those metrics so tend to measure Gartner influence by its Magic Quadrants and event presentations.
At the same event I spent some time with Bertrand Dussert of Oracle. He is also a columnist at Forbes and clearly influential that way. But in the session he told us he spends most of his time meeting Chief HR Officers of large, global companies. To me the latter, un-quantified to the outside world, is likely even more influential.
At the event, couple of folks asked me where my friend Ray Wang was. “He is tweeting about the show. He must be here”. I had to smile to myself and say Ray did not get to be a prolific tweeter (over 120,000 tweets) by not also being a prolific frequent flyer and spending time with a very wide range of clients and events.
Dennis Howlett recently tweeted “It was exactly 1 year ago today that I decided my time was done with #ZDNet. 9 months after launch we're a tad shy of 1 mill PVs.” Impressive number but also makes you curious about the demographics of the eyeballs. Do they belong to the hundreds of customers Ron and Bertrand talk to? Do they also read Ray’s tweets?
Steven Kotler writing about the“ROI of Reading” says “Books are the most radically condensed form of knowledge on the planet. Every hour you spend with Rise is actually about three years of my life.” I saw the article courtesy of John Hagel, a famous author and even more famous supporter of indie book stores.
So here’s my question: What color is your influence? And how do we measure it?
When I present at events I have been known to ask corporate technology executives such as CIOs and CTOs in the audience to stand up so I can applaud them. I have long believed our industry gives way more credit (and wealth) to vendor executives and that is my small way of acknowledging the corporate technologist.
So I was really pleased Karl-Heinz Streibich asked me to interview (mostly) corporate C level execs across 10 countries for his book, The Digital Enterprise.
acatech (German National Academy of Science and Engineering): President Prof. Dr. Henning Kagermann explores the wide range of stakeholders involved in the transformation to a digital enterprise.
Accenture: Senior Managing Director for Austria, Switzerland and Germany Frank Riemensperger explains why the best businesses must develop a “digital vision”.
Allianz Group: CIO Dr. Ralf Schneider on balancing the opportunities and risk generated by massive volumes of customer and product data.
BBVA S.A.: CTO Ramón Laguna on rapidly scaling technology to implement the goal of becoming a Tier-1 global investment bank.
Coca-Cola Enterprises: CIO Esat Sezer look at how cloud computing will drive the next generation of productivities.
Daimler AG: CIO Dr. Michael Gorriz and Information technologist Dr. Kai Holzweissig on driving the digital enterprise with linked data.
Datev eG: CEO Prof. Dieter Kempf examines bringing industrial level IT security to small and medium sized businesses.
DB Systel GmbH: Chairman of the Board Detlef Exner on how German railways are addressing a new generation of digital customers.
Deutsche Telekom: CEO of T-Systems and Deutsche Telekom Board Member Reinhard Clemens explains why traditional network providers can – and must – develop mew business models.
DFKI GmbH (German Research center for Artificial Intelligence): CEO Prof. Dr. Wolfgang Wahlster on how semantic product memories promise to reshape how products are manufactured, shipped, sold, consumed, traced and recycled.
Echo Entertainment: CTO Rob James details how technology-enables innovation can better address their VIP customers.
General Electric: Global technology director William Ruh on how 50 billion interconnected machines will drive the Industrial Internet revolution.
Hubert Burda Media: CEO Dr. Paul-Bernhard Kallen looks at turning a German magazine company into an enterprise for entrepreneurs.
MAPFRE: CTO José Manuel Inchausti Pérez discusses how satellites have transformed their business and help create more agile services.
Nissan: CIO Celso Guitoko describes how to design “smarter” products.
Qualcomm: CIO Norm Fjeldheim speaks of how to provide highly personalized and contextualized customer experiences.
Siemens AG: Member of the Board Prof. Dr. Siegfried Russwurm on how the fourth industrial revolution will create a paradigm shift in required workforce qualifications.
Staedel Museum: Director Max Hollein on how a digital visit to the museum is a sensual experience.
Standard Chartered PLC: CIO Jan Verplancke details the roll-out of mobile banking across several continents.
Statoil ASA: Vice President Magne Fransten on safety through technology in harsh operating environments.
Technische Universitaet Darmstadt: Chairman, Information Systems faculty Prof. Dr. Peter Buxmann looks at new risk scenarios and enabling new business models.
TUI InfoTec GmbH: CEO Heinz Kreuzer on using social media, real-time analytics, big data and mobile devices to create a more enjoyable customer experience.
The Kindle version of the book is only $ 3.99 and all earnings are going to charities. So, please download and join me in applauding these executives for the amazing and largely unappreciated innovation they – and countless other corporate executives - are delivering.
I was, of course, prepared for a wide range of technology as guest columns poured into the Technology and my Passion series but reading each I have been amazed how the mere mention of an unusual or less mentioned place takes me there
Krishnan’s song Fisherman and Banker took me to coastal Mexico, Ben's Wembley reference took me to London, PJ’s coffee aroma took me to the stunning Balkans, Catherine’s family tree hunt took me to fine food in Northern Italy, Nick’s long bike rides to the Gold Coast of Australia, Margaret’s column to the flamingo filled Lake Nakuru in Kenya, Mark’s mention of Indian River Lagoon to Spaceport USA and on and on
Read them all and get your own wings of fancy. The technology tour is also pretty impressive.
I took the family to Cirque du Soleil in Orlando over the holidays. Excellent show, but this week in Vegas walking by their many other shows along their Strip I was reminded of the compilation of several Cirque skits in Worlds Away.
I felt the same way at Oracle’s HCM event here. I came here expecting to hear about PeopleSoft versions, Taleo integration and Fusion HCM momentum. There was all of that and actually much much more.
Mark Hurd, President pointed out he and Larry Ellison are both presenting at an event for the first time (other than at their annual OpenWorld) to emphasize their view of the importance of the HCM market. In his keynote, he discussed how a CEO he views the HR function with aging workforces, with a very different mindset needed for recruiting Millennials, and used a demo of compensation benchmarking and other features. In a breakout with a few analysts he elaborated on Oracle’s differentiation compared to SAP and Workday in particular.
David Rock presented a Neuroscience view of Leadership and his SCARF model on collaboration and organizational politics and influence.
In a small breakout Bertrand Dussert, VP of HCM Thought Leadership shared what he is hearing from CHROs at large companies (he himself ran various global HR units at American Express and UBS before his Oracle stint) – a clear desire to move employees at every level to more of a customer focus, the changing nature of shared services, the role of data jocks in HR he recently articulated in Forbes. We even managed to touch on robotics in the workforce and renowned attorney Garry Mathaison’s positions on the topic.
A lunch with John Sumser of HR Examiner and Mark Bennett who leads Oracle’s Social HRM efforts was even more diverse – from The Whole Earth Catalog to Quantified Self metrics and Oracle’s new WorkLIfe apps to “R&D in HR” in the military and other large institutions.
Lexy Martin and Stacey Harris of CedarCrestone hosted an “unevent” – an impromptu discussion of integration between HRMS and Talent management and the realities of HR analytics and Social HR
Hilton presented on how HireVue (which I first wrote about in The New Polymath when they were much younger in 2009) has digitized their interview process and made global recruiting so much easier with the ability to evaluate candidates virtually. I spent a few minutes with Mark Newman of HireVue afterwards and he told me about other global projects at companies like GE and nuances like the need to account for VoIP censorship in some countries and privacy standards in others.
I spent some time with Bryan Majeswki of Baker Tilly and got a field-level perspective of Taleo and Oracle HR implementations.
The Analyst Summit before the event it was a good opportunity to mingle with several HCM focused analysts and play a bit with Oracle’s drop dead gorgeous iPad UX, and learn about Fusion momentum and recent mobile, social and analytic extensions
All in all a full couple of days with a diverse perspective on the rapidly expanding role HR executives and technology are being expected to play. Too bad I could not stay today and listen to Siemens about their Oracle decision, and to listen to Larry’s keynote and attend a few other sessions
Yes, I felt like James Cameron with his 3D camera looking down at many different Cirque acts. Quite a sight.
I got a FitBit for Christmas and have joined the legions of folks who are part of the “quantified self” movement. So, I was tickled that Oracle at its HCM World conference is running a Wellness competition allowing attendees to benchmark against others there using FitBit devices that Oracle is giving out as swag.
More interesting, Oracle shared at its Analyst Summit ( under NDA) a series of WorkLife apps they are rolling out, one of which focuses on Wellness. It aligns Individual Wellness Goals with Employer Healthcare Costs. Other apps focus on individual competitions, their social reputations etc. The common thread is they are all aimed at individuals, but in many ways are attractive for their employers to get intelligent about. At some point, no reason why Oracle could not facilitate a marketplace of such apps created by third party developers.
It is going to be an interesting new trend in HR applications. While it fits with the “quantified self” and social revolution, it also comes at a time of growing privacy concerns. As individual employees (and consumers and athletes and cooks etc) we love all the personal data we are being provided while worrying about how our employers and vendors and governments are using the data. Nonetheless, it is good to see Oracle innovate with this new class of apps.
Start of whine - as you review the Wellness competition stats below – I actually lost my FitBit on a long walk on the Strip at Las Vegas last night and miraculously found it again, minus the 6,000 steps it missed. Without that carelessness I would be in the top 20 in the competition. End of whine
Just last week I was talking to a journalist and comparing executives in tech companies to large multi-unit businesses. I did not use the term Polymath but I used some examples. Jeff Immelt did stints in its Plastics, Appliances, and Healthcare businesses and as a board member of GE Capital before he became CEO of GE. Others include Peter Voser, recent CEO of Royal Dutch Shell who had prior assignments in Malaysia and Australia, in Chemical Units and various finance roles.
In contrast, I said even tech companies like HP and Microsoft with multiple businesses do not have clear career paths which rotate promising execs across businesses and country locations. I mentioned Satya Nadella as a bit of an unusual executive in the industry with experience at Sun, and then several roles at Microsoft Cloud (Azure, Office365 etc.), Online Services (including Bing) and Dynamics (ERP/CRM functionality) units.
As he is named Microsoft’s 3rd CEO, that breadth of experience likely played in his favor.
During the analyst briefing this past Fall, I was impressed Microsoft had classified its wide portfolio into 7 competencies below. Even more impressive there were signs Microsoft was bringing complex projects to markets and in specific opportunities as with the Delta Airlines in-flight POS opportunity a mix and match of these competencies:
High Value Apps
Consumer/Enterprise (comfort with both)
I am guessing the Microsoft search committee struggled to find too many tech executives with that range of experience. There just are not too many Satyas with such a broad resume in the tech industry. A complex entity like Microsoft needs that diversity.
I am a lifelong package guy. First mainframe package implementation in 1984. As/400 packages in 86. First SAP R/2 experience in 89. Gartner ERP analyst starting in 95. Many package related outsourcing and SaaS negotiations in the last decade.
To me, Buy won the debate against Build a long time ago.
So I felt a sharp pain when I read this Coverlet Meshing column in InformationWeek which is in-your-face challenge to that belief and ends with
The honesty of it is that if your business model (and talent) can't manage a build, then you won't be able to deliver a buy.
Now Coverlet (a pseudonym) is a financial services executive and while he raises valid cultural reasons (Build attracts better tech talent), many package vendors have made lots of promises but under-delivered to that vertical. But if he was in Retail, Insurance, Utilities, Telecomm he could have written something similar. In fact if you talk to industrials as in auto, medical devices etc even they are doing plenty of custom development these days when it comes to IP in their products, in customer facing and other mobile apps, in cutting edge analytics. Most of the case studies in my recent book, The Digital Enterprise, described custom development projects as they discussed innovation.
The reality is package vendors are increasingly getting narrowed to horizontal, back office finance, hr and procurement type functionality. Most missed their opportunity to become “ERP” for various industries. Many have missed out on globalization opportunities. Others have missed out on emerging product and customer centric apps. The TCO of many packages has gotten out of hand with onerous integration with built systems, data center charges, upgrades and other on-going maintenance changes (hello: 96% margins). In many ways, Buy cruised through the last decade.
There are many good reasons to still Buy (hey, you cannot wash away a lifetime of bias in me), but it’s less of a slam dunk decision. The functionality, economics, ease of deployment and upgrades, partner expertise and many other systems lifecycle items around packaged technology need a makeover.
Transitions are painful. Look around the globe and some agrarian economy or another is being industrialized. Some blue collar town is moving to a services focus. Robots, drones and machine learning are transforming every industry in the Western economy.
And the naysayers are out in force ruing the transition, painting doomsday scenarios.
They forget humans are very flexible. We adapt and evolve. And the “old” economies do not disappear. See all the innovation happening around agriculture and food in this New Florence category. See manufacturing bounce back in the US. Not the old kind. More IP in components, more automated, cleaner from a pollution and other waste POV.
And look at the challenges that still await our scientists and engineers – climate change, personalized medicine, efficient desalination, asteroid mining, Arctic harvesting etc. Yes, also gridlock in DC :)
I heard Jeff Immelt of GE once summarize his career. He said he has worked on over 100,000 business problems in his varied career. He can talk aircraft engines, blowout preventers, MRI scanners, locomotives. He has met most country leaders and discussed their opportunities. As he said that I thought I saw him twirl an invisible Rubik’s Cube with his hands.
I advise every young person to think like Jeff. Lord knows we have so many problems still left to solve. It will be a long, long time before we run out of opportunities for every human being who is willing to work on something which moves the planet forward in big and small ways.
It is an honor to welcome Plex to the past and present gallery of innovators and disruptors who sponsor the Deal Architect and the New Florence. New Renaissance. blogs.
Plex is the Manufacturing Cloud, delivering industry-leading ERP and manufacturing automation across industries including aerospace and defense, food and beverage and motor vehicles with customers like Aerospace Technologies Group, Green Flash Brewing Co., JD Norman Industries’ and Sanders & Morley Candy Makers.
The timing is impeccable as manufacturing is enjoying a renaissance particularly in the US. In the new book, The Digital Enterprise we wrote
“The United States has offshored manufacturing for years. Now, the country is poised for a stunning turnaround, for multiple reasons. Differences in labor rates compared to developing countries like China are rapidly shrinking. Industrial strife and intellectual property theft in certain regions and cultures have become major business impediments. Shipping costs from overseas plants have been rising. Finally, the U.S. energy outlook is increasingly bright, at least in terms of carbon-based fuel reserves, due to new shale explorations. These factors are combining to create a much healthier manufacturing environment in the United States.”
Confirming that momentum, Plex announced yesterday it had a record year in 2013, growing to nearly 400 customers representing more than 1100 manufacturing production lines. “They represent a wide range from craft beer and ice cream makers to diesel engine plants,” said Jason Prater, vice president of development at Plex. “Cloud has the potential to transform manufacturing, reducing costs while giving operations access to continuous innovation – from the shop floor to the top floor — and 2014 is shaping up to be our best year yet.”
Look forward to exciting new products and thinking from Plex. Welcome aboard!
Apple has been sliced and diced in countless books and blogs to find its “secret sauce”. To me, Steve Jobs created a petri dish and threw in all kinds of rare elements – Tim Cook’s operational excellence, Jony Ive’s design aesthetic, Ron Johnson’s retail experience, Scott Forstall’s ecosystem vision, Phil Schiller’s marketing chops, and many others including Terry Gou, CEO of Foxconn, the contract manufacturer. It took a while to gell, and likely required all kinds of ego and conflict management, but his enduring legacy is having created and managed that dream team which even with a few changes continues to do well.
I am starting to see that comprehensive “build to last” thinking show up in at least a few companies. It is nice to see Keurig with its success with single serve coffee look to apply their tech and other disciplines to other categories. Fortune: "The question is, How do you do five, six, seven more of those in the next 10 years?"
In contrast, though I see way too many people look for the silver bullet, the plastic surgery. After I wrote The New Polymath, people suggested I write more about how to. So in The New Technology Elite I structured the book around 12 innovation traits from design elegance to paranoia, and gave plenty of examples of each in innovation settings. The new book, The Digital Enterprise is structured around business processes – product creation, manufacturing, human resources etc. Each has world class examples.
Now I am hearing some grumbles. It’s too much work – it’s P90X. Is there no simple diet for this? Is there no app for this? Can we not buy versus build slowly?
Sure there is. But that’s called process tweaking. In fact there is very good payback from that. Just take 1-2 chapters from my book and optimize those areas.
But then don’t think you will become Apple. That’s not building a dream team or a build-to-last innovation culture. That’s just a bit more work which needs working with 10-12-15 of my chapters. But when that comes together it is a sight to behold like the 1992 US basketball team in Barcelona.
Remember Dirty Harry’s reaction when he was told he was being grounded and assigned to the Personnel department?
Well, Personnel has a more sophisticated moniker these days but its image in the eyes of many executives, is not much better.
That’s a shame because HR has been, surprise, surprise a pioneer in adopting many emerging technologies.It has been a hot bed for cloud applications – Workday, Oracle Fusion, SuccessFactors, Cornerstone etc. We have known for a while social HR has been hot with LinkedIn and other social recruiting.
Fortune says recruiting is a hot mobile app
The sudden, widespread use of mobile devices for job hunting has blindsided most HR executives. About 82% of the 1,000 job seekers surveyed last fall by career site Glassdoor.com said they expected to use their phones to look for jobs in the next 12 months.
And of course HR analytics is increasingly hot as I have written here and here. Finally, as I pointed out during the Workday Predict and Prepare videocast as robotics and machine learning influence more segments of business, the HR role there will be significant.
Few other corporate back office functions – finance, procurement etc – have been such a hot bed of recent technology activity. It’s hot enough to merit a Larry Ellison keynote at their CloudWorld event today. Even Dirty Harry would be impressed!
Oracle’s HCM suite does not often get enough press but at OpenWorld I got a glimpse at their use of gamification, talent analytics and video share apps for team building, recruiting and training. I am looking forward to a bit of a deep dive at their HCM World next week.
When the President talks this evening people will snicker when he mentions jobs… but the encouraging reality is the rebound of manufacturing in the US is bringing back regional sourcing and associated jobs
Regional demand looms large in sectors such as automobiles, machinery, food and beverages, and fabricated metals. In the United States, about 85 percent of the industrial rebound (half a million jobs since 2010) can be explained just by output growth in automobiles, machinery, and oil and gas—along with the linkages between these sectors and locally oriented suppliers of fabricated metals, rubber, and plastics … The automotive, machinery, and oil and gas industries consume nearly 80 percent of US metals output, for example.
Like many U.S. companies, Kimray has to contend with a shortage of skilled machinists. Instead of offshoring, the company, which has $230 million in revenue, offers an extensive in-house training program emphasizing math and technology to get new hires up to speed, plus continuing education. It also helps fund college tuition for interested full-timers. "I'm willing to invest in them if they will invest in themselves," says Hill.
And finally, Inc has a very nice article on the backbone of Germany – its Mittelstand – small manufacturing shops and they never gave up on regional sourcing and provide US manufacturers even more of a model to emulate
On Sunday as I was surfing the Grammys, I saw a tweet from Marc Benioff and I said to myself – one of these years I should conspire to get a running commentary from him on the show. With his range of contacts in the industry and the range of genres which grace Dreamforce each year his insight would make for such a rich evening.
On Monday, I see he has jumped in into the debate about Silicon Valley’s charities. Our own view on charity is closer to home, more than on corporate giving – my wife donates to homeless and is very generous to our handymen and families – but you have to admire him for taking a stand.
Not everyone is a fan of Marc’s diverse interests or style, but as I wrote at Dreamforce, I certainly am. As a fan of Polymaths, I like colorful executives – at work and at play.
I am a lifelong software guy – developer, analyst, blogger, author– and have marveled how the industry has grown around the world over the decades. The New Florence blog has number of software innovation categories, my books are chockfull of software executives and projects (the underpinnings of many innovations in the case studies in the new book are software centric)
Honestly, though I cringe when I hear Marc Andreessen talk about software “eating the world” or now Forrester talking about corporate software assets as the crown jewels.
Software is necessary, but not sufficient, even in technology projects
People will often cite Apple’s (less publicized) software assets as its secret sauce. One word should dispel that: Foxconn. Apple would be nowhere without the contract manufacturing that has churned out millions of devices at high quality, under tremendous time pressure, at unbelievable cost, and in impressive secrecy. Then there is its superb design team, its retail excellence, its standout marketing and on and on. Ditto with automobiles. Yes, cars today have millions of lines of code and better UX and mobile apps are making the experience much better. But improving design, innovations in material science, satellite support, many other STEM disciplines are just as important.
The world’s problems need a much broader set of disciplines
Large growth in the next few decades will come from the “grand challenges” that we face – related to climate, energy, food, water. Of course software will play a role in each – witness how even Monsanto picked up a Big Data play in Climate Corp. But we need organic chemists, marine biologists, quantum physicists and many other skillsets besides software skills.
Software economics are concerning
While infrastructure costs – hardware, network – etc have been declining nicely, many components of enterprise software costs have remained stubbornly high. Look at IBM, SAP and other enterprise maintenance costs. Look at their partner costs. Indian outsourcers pursuing CMM Level 5 continuous improvement mandates would deliver steady productivity. That has disappeared in the last few years. Without the productivity that cloud and mobile software has delivered it has actually been a lost decade of software un-productivity. We need much more automation,crowdsourcing, project management discipline and Moore’s Law type price/performance improvements before we can rely too extensively on software assets.
Here’s a thought – let’s all of us in software start thinking of feeding the world before we talk about eating it.
Dave Kellogg responds to a Bruce Cleveland post on Siebel and Salesforce and industry disruption. As he says there are three sides to each story so let me add my side to those of these very smart friends of mine:)
First of all, talking about three sides it would be fun to get the principals on a Charlie Rose show. By principals I mean Larry Ellison, Tom Siebel and Marc Benioff. It would be nice theater – for a Sunday night.
But if I was an MBA student, frankly, I would focus more on my Monday morning and focus on on-going CRM disruption. So, I would ask Bruce and Dave (both guest lecturers) to comment on
How CRM enabled sales is evolving as customers get product info from web sources and recommendations from peers and not as much from salespeople?
How CRM enabled customer service is evolving as Amazon Mayday and Apple Genius Bar have reshaped our expectations?
How CRM enabled marketing is evolving as BMW and others introduce rich mobile apps which are part commercial, part game, part product brochure?
Why TV advertising refuses to be disrupted and still manages to command $ 4 million for a 30 second SuperBowl spot?
Do they agree with GoDaddy that the low end of SME market is still underserved by CRM vendors?
Which digital agencies would they consider for summer or full time jobs?
and yes finally, what did they think of Larry and Tom and Marc on that Sunday night show :)
Last summer when I started to interview executives for the Karl-Heinz Streibich book, The Digital Enterprise, I presumed most would talk to me about how they are using social, mobile, analytical and cloud computing in their industries and countries.
That they did, but they kept going and going
Daimler described robotics and M2M networks they are investing in
Echo Entertainment described how their casinos in Australia are looking at facial recognition and other tech to better service their best customers
GE talked “Industrial Internet” – how their wind turbines, aircraft engines, MRI scanners, locomotives and other brilliant machines are communicating with each other and with us
Coca Cola Enterprises described a couple of extremely innovative crowdsourcing applications
Mapfre, the Spanish auto insurer discussed how satellites have transformed their business
BBVA’s investment bank described complex event processing and other technologies for their trading and other applications
Deutsche Bahn described their use of 3D visualization tools
Datev talked about how they are rolling out sophisticated digital security to their thousands of SME customers
Nissan discussed how steering-by—wire – a concept from aviation – in their Infinitis
I could go on but I was blown away with the wide range of emerging technologies each described. Even more impressive was these are not Silicon Valley companies. They are Main Street brands that are taking “digital” to a whole new level – way, way beyond social, mobile, analytic and cloud computing.