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Eliminate Administrivia in Finance

3/8/2010 3:56:36 PM

I hate administrivia.

Which is why I’m so fond of IT – it has the ability to cut down the amount of silly, needless work that people have to do in an organization. It automates manual processes so that no one has to do them. Potentially, you have the ability to enter data once and only once. Constant, tedious reviewing and micromanagement can be replaced by exception monitoring.

Paperwork is an area which can be time-consuming and tedious unless you get rid of it. Once upon a time I had dozens of file drawers. Now I have a hard drive and desktop search. Once you had to laboriously sift through 10-Ks and S-1s to find a nugget of company data. Now you have CTRL+F. ERP and other systems have eliminated considerable amounts of paperwork by automating record keeping. Vendors have spent time trying to develop systems that make the process as painless and efficient as possible. Yet there are many gaps left to fill in finance departments.

One of the least understandable failures to apply simple innovations to ERP systems [http://www.ventanaresearch.com/blog/commentblog.aspx?id=3002] is the reluctance of some companies to use electronic- or scanned documents in such areas as the payables and receivables functions. This is one area where about half of all companies with 1,000 or more employees lack this capability, even though it is well established and not at all expensive. For those of us who travel, software that automates the submission and processing of expenses is a boon – and it reduces the amount to time wasted by accounts payables clerks and managers.

One area still very ripe for innovation is the adoption of document management in finance departments for routine, repetitive document creation – reports to third parties, filings and other documents that use financial and other numerical data in combination with text. One area that is gaining increasing attention is the creation of financial statement filings for the SEC because the imposition of the XBRL tagging mandate is increasing the workload that must be handled in a relatively short time – in the period between the close of a fiscal period and the filing deadline. However, this is just one area.

Given the broad array of statutory and regulatory requirements that involve the combination of enterprise data and text – with the numbers interspersed in boilerplate and often used more than once (contained in a table and cited in the text) – I had long thought that document management was an IT category that was a natural for finance departments. I had thought that the value was obvious because typically highly-paid individuals have to comb through these documents, ensuring that the numbers are correct, there is agreement between tabular data and what’s contained in the verbiage and that the text is the most up-to-date version. I thought wrong.

Yet this might be changing. Vendors such as Clarity, soon-to-be-joined-by Oracle and others are gaining ground in selling the idea of automating the close-to-report cycle. If these vendors are smart they will use the inventiveness of their customers to demonstrate a multitude of ways that finance departments can use document management to automate tasks that are needlessly time consuming. Oracle has its own document management code base (it acquired Stellent – once called IntraNet Solutions – in 2009) while Clarity has built its applications on a Microsoft platform. IBM also could be a player here drawing on its Cognos/FileNet roots.

Typically the CFO also carries the title Senior- or simply Vice-President for Finance and Administration. CFOs have spent years focusing on increasing the efficiency without tacklin

The Social Media Revolution in Industry Analyst Community

3/5/2010 6:45:07 PM

It is clear that social media will change everything. Unquestionably they will continue to impact to industry analysts, both overall and in my area of focus, business technology. Here I’ve already seen the effect of new channels that deliver insight, research and advice, continuously and in small bits. I myself have been engaging in social media for many years both personally and professionally and across many mainstream brands. In 2009 the firm I lead, Ventana Research, integrated into its communication efforts providing research insights, blogs, education and collaboration opportunities through Twitter, LinkedIn, Facebook and Business Week – Business Exchange.

But that was last year. 2010 is proving to be different yet again. The numbers of business and IT professionals embracing technologies like Twitter for business and social purposes are growing dramatically. I have witnessed this as I have tweeted at industry events on topics like analytics, business intelligence and performance management. Each time I do, individuals from global 2000 organizations respond by direct-messaging about specific points of view or with questions. This is the first step in driving true business social collaboration across Twitter. Of course, full collaboration only happens when tweets are retweeted to everyone so they can read and respond, which drives a larger volume of voices to comment or question.

Social media collaboration, like any activity related to marketing or interactions in general, is best assessed through measurement. Figuring out how to measure social media interactions and effectiveness has been no easy task for technology providers as measurement is easy only in comparison to the challenge of truly understanding its effective value. It’s not dissimilar from the challenge marketing organizations face in striking the right balance of quality and quantity in the business opportunities (“leads”) they generate (which, incidentally, most are still not very good at). I have time and again looked at supposed listings of top bloggers, only to discover that those topping the list don’t post blog items any more often than every three months. Too many of these lists are nothing more than friends promoting friends rather than any analysis of relevance or value.

As challenging as rankings are of blogs, that’s nothing compared to assessing Twitter, where the high frequency and short length makes it far more difficult to evaluate relevance. It’s far easier to say what isn’t important: A high number of tweets does not indicate their relevance or aggregate value. Many people tweet both personally and within their business or professional context. I myself have a personal Twitter handle to express my more personal perspectives as distinct from those that have to do with my business or business-social identities. Yes, the blending of business and personal can help provide insight, but that needs to be balanced with a sense of what it’s appropriate or useful to communicate to the broader audience that follows you for your business opinion and perspectives. Analysts many times forget that the quality of tweets can impact those who actually chose to follow because they want to read something relevant in the tweeting; if they aren’t getting that, it’s all too easy to take the one-click action to do an unfollow in Twitter.

This lack of attention to relevance in an industry analyst’s communication via social media inevitably will generate the only kind of feedback that ultimately works – declining numbers – as the application of sentiment and text analytics increases to enable followers to tune their

Jitterbit Streamlines Cloud Data Migration and Enterprise Integration

3/4/2010 8:06:39 PM

The role of data in most enterprises is straightforward, but making it readily available as needed is not. The typical conundrum in today’s organization is that the lines of business store data in various applications both internally and externally in cloud computing environments. In times past and inside of the enterprise this was addressed by enterprise application integration (EAI), which companies acquired and integrated into their IT middleware and infrastructure technology stacks; more recently organizations have augmented EAI with data integration technologies. In either case IT has responsibility for the movement of data, and handling that requires sophisticated technology professionals.

Lately this situation has been addressed by the introduction of Jitterbit, a rapidly growing global provider of data migration and integration technologies that operate inside and outside the enterprise across business processes and applications. Its core product has attracted hundreds of customers, including Continental Airlines, McKesson, NASA and TransUnion. Jitterbit has filled the void where designing and executing the migration of data across applications, services, databases and even files has proven too complex for business and data analysts. It provides a common platform for ongoing migration and integration of data and eliminates the one-off data loader or custom approaches that consume time and are prone to errors. Jitterbit also helps address data quality issues by providing inline cleansing and transformation of data to ensure it meets the requirements of specific applications.

In 2009, Jitterbit released version 3.0, which brought team and project management capabilities, real-time integration across Internet-based Web services and the ability to operate across multiserver environments. It supports dedicated integration with cloud-based Oracle CRM On Demand, NetSuite Business Management Suite and salesforce.com and other cloud computing, open source and enterprise systems. The company recently announced the introduction of the Jitterbit Data Migration Service. It is built on the same platform as the enterprise environment and enables simpler migration of data inside and out of salesforce.com environments, which marketing, sales and customer service teams increasingly use. Salesforce.com’s recent advances in providing more sophisticated customer services through its Service Cloud, which my colleague has analyzed (See: “Salesforce Cloudforce – Socializing and Servicing Customers in the Clouds”), will further enhance the importance of Jitterbit’s offering. Most organizations do not realize what a terrible job salesforce.com has done in allowing data to freely migrate and integrate with its system – that failing is an opportunity for Jitterbit in every company using salesforce.com. Using Jitterbit, analysts in the lines of business can operate much more quickly than when using custom efforts and also can collaborate with IT on a consistent platform to support a range of needs.

In today’s organizations timely movement and integration of data are essential components of efficient business processes and effective performance of everyone in the business, as I have pointed out (See: “Data Integration – Using Technology to Manage your Data Assets Efficiently“). Jitterbit’s new migration product for salesforce.com will make it even more appealing to organizations that want to ov

Essential Priorities for Optimizing the Business Value of Customer Interactions in 2010

3/3/2010 8:36:11 PM

For many years experts and executives have expressed the view that customer service is the only basis for differentiation between companies in highly competitive markets. The main drivers of this view are that product innovation, for both soft and hard products, now occurs in days or weeks rather than months or years, making it very hard to compete on products, and that at the same time customers have become much more demanding. This reality has been underscored by the economic downturn. As a result, retaining customers and increasing wallet-share for existing customers have become greater priorities than signing up new customers. To meet these goals, companies have to pay more attention to managing all customer-facing activities, and this translates into paying particular attention to the customer’s experience each and every time a customer interacts with the company. What is more, companies have to pay more attention to interacting through the channels of communication that customers prefer and must adapt their customer service strategies accordingly. Within this context, here are some of the important trends I expect to occur in customer management during 2010:

1. Multichannel Customer Service – Over the last few years the number of communication channels has proliferated, and customers now communicate using fixed and mobile telephony, written documents, fax, e-mail, the Internet, instant messaging (chat), mobile text messaging, videoconferencing and, the latest trend, social media forums. Although my research into the use of technology in contact centers called Customer Interaction Technologies showed that many companies have implemented additional technology to support these channels, the reality is that many have done it to reduce costs rather than to match customer demand or improve customer service. During 2010 we expect this motivation to change, as companies examine ways they can track customer interactions across these channels to improve the experience at each touch point, to synchronize activities across channels and to align the business outcomes from interactions to their business goals. We expect the debate about “social CRM” or “social customer service” to rage on (See: “Social Customer Service a – Fantasy or Reality?”), as companies try to get a grip on how consumers are using sites such as YouTube, Facebook, Twitter and LinkedIn.

2. Customer Experience Management – For more than 20 years the business world has talked about customer relationship management (CRM) as the process and technology that would drive companies to become customer-focused and improve relationships so that customers would stay loyal longer and spend more. But CRM has focused on internal processes, improving marketing, sales and customer service while doing little to directly impact the customer. As I discovered in benchmark research, customer experience management (CEM) redresses that balance and focuses entirely on proactively managing the handling of interactions. In practice this means improving how customer service agents (and others) handle interactions (see “Contact Center Agent Performance Key for Customer Experience”) and how interactions are handled by various forms of self-service. During 2010 we expect companies to invest more in technologies such as smart agent desktops, natural-language-driven, smart customer portals and customer performance management; these approaches should not only help increase customer satisfaction but help drive down average call-handling times and increase first-interact

DataFlux Provides Enterprise Data Management for Business and IT

3/2/2010 2:46:00 PM

The market for managing data assets through data quality, data integration, master data management (MDM) and federated data access continues to grow as more organizations evaluate and deploy these technologies. This demand has generated a rapid evolution of technology solutions to automate these necessary activities for ensuring access to consistent, high-quality data across the enterprise. Competing in this data-centric technology area is DataFlux, a wholly owned SAS company, which in the past has focused on data quality for a range of activities from MDM to data governance. Now it has significantly expanded its products and resources with the announcement of a new generation of technology built on its DataFlux Data Management Platform. Parent company SAS accelerated this push by reassigning some of its key data-related technologies and products to DataFlux so it can offer a broader set of data management requirements that span business and IT. (Let’s be clear that offering data management in this context does not mean selling an actual database but tools to manage the data going into, circulating within and going out and into the enterprise.)

This expanded focus gives DataFlux a technology portfolio with which to compete more fully against other major providers; IBM, Informatica, iWay Software and Oracle all directly match up with this range of new capabilities. DataFlux now can help organizations across a range of data management areas including data governance , data quality and data integration and consolidation . The DataFlux Data Management Platform includes tools that blend SAS Data Integration Studio and DataFlux Data Quality technologies into a set of products that interoperate and available directly from DataFlux. These products include DataFlux Data Management Studio, DataFlux Data Management Server, DataFlux Federation Server and DataFlux Connect.

DataFlux already offered MDM products specifically for customer and product data. MDM is an integral part of product information management, and our benchmark research on that topic found MDM and data quality essential in streamlining the consistency of product data across the enterprise and the business-to-business (B2B) supply chain. In this area DataFlux now can deepen its ability to address the challenges of MDM, which must be closely managed from a process and technology perspective, as I have already written (See: “Can Master Data Management Deliver Results or Headaches?”). In addition DataFlux has also gotten from SAS its technology that provides virtualized access to data across the enterprise; it’s now called DataFlux Federation Server and can provide significant points of data access across platforms and sources.

This is a big step forward for DataFlux, and it comes at a time when business and IT departments are looking for a common provider of integrated technology for data management that can help them gain operational and performance improvements involving cost savings, revenue increases and even governance, risk and compliance (GRC). Our research continues to show the challenges of integrating disparate tools for organizations and the need to automate key data-related activities; DataFlux now can be

SAS Simplifies the Science and Use of Analytics in 2010

3/2/2010 7:31:16 AM

The SAS Institute global analyst summit Inside Intelligence 2010 was held in Steamboat Springs, Colorado where industry analysts from across the world gathered together. Everyone in the technology industry knows SAS Institute as it provides a broad range of analytic and data technology infrastructure to business and industry solutions. I was invited to this industry event to assess SAS Institute and its technologies and solutions as our firm has not historically covered SAS in any great depth of analysis or recommendations. This will change based on this opportunity for an in-depth assessment and interactions with its customers.

The event was kicked off by Dr. Jim Goodknight an analytics industry leader, founder and CEO of SAS, and CMO Jim Davis both of whom provided insights into the state of its business and its achievements in 2009. It was interesting, and a reminder that SAS not only was rated by Fortune magazine the #1 in place to work in 2009 but that they earn more than $2 billion in revenue and recorded a growth rate of two percent and achieved its 34th year of profitability.

SAS is truly global company with more revenue generated outside North America than here. It has a strong history of business in the financial services industry where they have 42% of revenue from that industry with government and services industry following with 15 percent and 11 percent respectively. SAS perfected the business model of licensing its software decades ago through a leasing approach and today 70 percent of its revenue is recurring. Appropriately, SAS focuses on measuring themselves from a customer and product satisfaction perspective but also from loyalty and usage. The company also has made its software available via a multitude of licensing approaches and its software is available through a SaaS model but also from value-based, grid, user based and many others. It also has leveraged partnering relationships with Accenture and Teradata to drive a significant volume of sizable transactions. Its recent strategic partnership with Accenture recently announced is significant in that it addresses IBM’s recent emphasis on analytics software and consulting services. SAS continues to grow outside its traditional customer base and in 2009 added more than 1,350 new customers ranging from Clorox to Lego. This growth reflects SAS’s focus on analytics and data issues across the enterprise and especially in industries like government, financial services, retail and manufacturing. Now SAS needs to further focus its marketing and sales efforts into line of business areas like sales, operations, contact center, finance and others who in most cases are not aware of its solutions.

SAS focused on what it calls Business Analytics, a framework of data integration, analytics, reporting and business solutions across vertical industries designed to solve specific business problems and act on opportunities. This reflects the attention SAS has placed on the science of analytics for some time and the skills it has developed in optimization, modeling, forecasting and statistics, to which it has over the last decade added improvements in the basic areas of reporting that is part of business intelligence (BI) aspects of query, analysis, alerts to dashboards and scorecards. In most organizations the use of SAS for more simple needs of BI has not been examined and is a large growth opportunity for SAS where in most cases they are brought to the table for evaluation. Now SAS has a broad reaching product portfolio of hundreds of products and is quite daunting to analyze due to its breadth and depth of its technology offerings. The SAS technology supports close to 30 languages with its analytics foundation of its core SAS 9.2 analytic i

IFRS – Seeing Nothing New in the SEC Announcement is a Mirage

2/25/2010 4:20:09 PM

The US Securities and Exchange Commission’s (SEC) long awaited (and long anticipated) announcement delaying adoption of International Financial Reporting Standards (IFRS) until 2015 at the earliest came as no surprise. Nonetheless, I think companies need to start right now working out how they will make the change to IFRS and developing a five-year IT capital plan to support it. There’s a lot more than meets the eye in the Commission’s announcement.

The Commission is delaying implementation of the formal change from US-GAAP (Generally Accepted Accounting Principles) because there are still major differences between the basic approach to accounting as practiced in the US and the rest of the world. Over the past three decades, the Financial Accounting Standards Board (FASB), which is chartered by the SEC to administer US-GAAP, has shifted to more of a rules-based approach, whereas IFRS is more of a standards-based approach. The latter gives company accountants and external auditors greater leeway in classification and interpretation but places a heavy burden on companies to demonstrate that the results conform to the accounting principles. Rules-based systems are far more prescriptive, detailing exactly how specific conditions and contingencies are to be handled.

Many think accounting is an exact science but that confuses it with bookkeeping. As the saying goes: bookkeeping is a matter of facts; accounting is a matter of opinion. I’m not a big fan of rules-based systems because I believe different types of businesses need fundamentally different approaches of conveying the meaning of the bookkeeping data into an accurate and useful picture of the state of the company. Attempts to impose different sets of strict rules ultimately creates distortions. Endless tinkering with the rules has left US-GAAP a bit of a mess, in my judgment. The switch to IFRS is as much an attempt to achieve harmonization with international standards as it is to throw in the towel and give up on the increasingly unworkable set of rules FASB has created.

Yet, getting from a rules-based to a principles-based standard is not going to be easy, which is why the delay is taking place. Some – maybe most – finance executives in corporations will conclude they can now forget about IFRS for a couple of years and write-off calls-to-action as attempts by consultants and other self-interested parties to generate fees for themselves. While that last part is undeniable, there’s no reason to believe there’s nothing to be done in the near term. Consequently it’s not too early for finance executives to look into the impact that changes in accounting standards will have on their ERP and consolidation systems.

For one, the transition from US-GAAP to an international standard will not be a big bang. Instead, FASB and its counterpart, the International Accounting Standard Board (IASB), which administers IFRS, will be creating new standards in parallel that will supplant both existing US-GAAP and IFRS treatments. Some may be close to either US-GAAP or IFRS, while others will be something different. When it comes time to flip the switch and turn off US-GAAP most of the work is likely to be done. To be sure, the adoption of many new standards will have its greatest impact on accounting practices and processes but may require significant changes to a company’s ERP systems, especially ones that have been heavily customized over the years.

For another, companies that operate internationally will find themselves under increasing pressure to present the result of their non-US businesses to local authorities using IFRS. This means being able to automate the production of financial statement using two parallel statutory consolidation and reporting methodologies. Some corporation

Product and Customer Profitability Management are Two Different Things

2/24/2010 2:06:09 PM

There has been, and there will be and increasing focus on managing corporate profitability over the next several years. The economic recovery in North America and Europe promises to pose a real challenge to business executives in maintaining margins. Managing product and customer profitability more intelligently have been leading-edge business topics the past several decades. While there have been some success stories highlighted in the business press and academics, I’ve found that “real world” results have been decidedly mixed, which is why these remain immature areas of business computing.

Of the two, product (and service) profitability is more advanced. In part this is because it’s a refinement of cost accounting, which has been around since the 19th century. It also reflects the refinements made to activity-based costing (ABC) and other marginal costing approaches and software over the past decade.

ABC and other marginal costing techniques came about several decades ago because it became clear that using “standard costing” often drove bad economic decisions, especially in complex manufacturing environments. Unfortunately, in its first iteration in the 1980s, ABC failed to live up to its hype and despite ongoing refinements to it; the initial letdown continues to hamper its adoption. Still, I expect upward cost pressures and a continued lack of pricing power will force corporations to focus on having a deeper and more economically accurate understanding of costs and cost drivers. I believe they increasingly will use ABC and related techniques (and software) to do this.

On the other hand, customer profitability management remains very immature in my judgment, because it is a much bigger challenge than product profitability. There are at least three reasons: the data needed to do the analysis is scattered across a company, the underlying analysis of these data is far more complex and companies do not (and cannot) control how customers behave. Addressing these three issues has not been easy. For this reason, companies have had a hard time managing the trade-off between volume and profitability intelligently.

For example, there’s the data challenge. Understanding which data are needed to do a good-enough analysis often involves a heavy dose of trial-and-error. The analysis that’s required can be complex: not only is product/service costing itself challenging but companies need to understand and define who the customer is. That is, is the relevant “customer” an individual purchasing agent, the business unit in which they work, a subsidiary or the whole company? Is it a person’s account, or all of their accounts? Are “they” an individual or a family? Does this definition always apply or does it change with the circumstances of the analysis? And then there’s the time element. Should “customer” profitability be calculated based on a month, quarter, year or multiple years of records? Should the assessment also include some measure of future revenue and profit potential? And once you’ve decided on which sorts of data are necessary to create the analysis, you then have to get it all in one logical place consistently.

Even after an organization has arrived at some measure of customer profitability, it’s not clear whether the conclusions are actionable. For example, analysis of retail banks famously conclude that 10% (or some such small number) of customers account for more than 100% of the profits. In other words, they have customers that range from highly profitable to heavily loss-making. Knowing this, what is management supposed to do? Generally, it’s a good idea to lose money-losing customers, but if they’re a highly profitable customer somewhere else in the business, antagonizing them will be a bad idea. Sim

NICE Systems Setup for Strong 2010 with Analytics and Events

2/23/2010 3:26:44 PM

NICE Systems is a well-established vendor in the contact center market, and despite a sluggish start, it finished 2009 very strongly. In the fourth quarter the company broke all its records for revenue, order backlog, non-GAAP operating profit and margins, which in turn contributed to a record year of revenues of $589 million and $120 million of cash generated. These results confirm NICE Systems as one of the most stable companies in the contact center space. It runs two discrete lines of business: enterprise contact center and security systems that also acquired and integrated a complex event processing (CEP) technology from Actimize that enable new forms of Operational Intelligence , which among other things helps prevent money laundering and fraud. These business lines and technology advancements are doing well and have contributed to these impressive financial results.

What interests me most is the contact center business and how the company generated this impressive performance in what has been a difficult market. NICE Systems has an integrated suite of products called SmartCenter , which includes most of the components needed to operate a multichannel contact center. However, my research into the state of the contact center market showed that two of its main products – call recording and agent quality monitoring – are nearing market saturation and are becoming harder to sell. Thus the latest addition to this suite, which provides cross-channel analytics , is significant. It allows companies to track how customers use multiple communication channels to access customer service, gathering knowledge that is of growing importance to companies running multichannel customer service, so much so that the NICE Interaction Analytics Business Solutions has already generated some multimillion-dollar contracts.

The forces driving this demand also align with some key findings in my benchmark research on customer experience management (CEM) and agent performance management (APM):

• Customers are demanding better service, which is driving up interaction volumes. Companies need to understand better what channels customers are using and what causes them to contact the company.
• More companies are adopting voice over Internet Protocol (VoIP) telephony in their centers, which is driving demand for better systems to ensure the best performance from VoIP systems.
• Companies need to reduce their operating costs, which is another reason they need better understanding of how their current systems are working.

All of these factors combine to produce increased demand for customer and contact center analytics; in fact, I am seeing a demand for analytics in every aspect of CEM – technology including overall performance, agent performance, agent training and coaching, a 360-degree view of the customer to drive better business performance, and social media analytics so companies can understand what their customers are writing about them on social media sites. I have seen increasing adoption of customer-centric performance management, and I expect that these adoption rates are about to increase dramatically.

These pressures indicate an interesting time for the contact center market in 2010. NICE Systems will of course have to go on competing against its two primary competitors, IT to plan more effectively , make better use of their people and anticipate how best to respond to competitors’ moves or changing conditions. They can enlist IT to reduce administrative burdens through more automation, elimination of paperwork and an increased ability to manage by exception. And they can use IT to free up time for the finance organization to take on a more strategic role by making it more efficient in its execution of repetitive, low-value tasks. Midsize companies need to make better use of their ERP/accounting systems , eliminate spreadsheet-based planning and budgeting and implement spend management.

Information technology for midsize companies has evolved considerably over the past decade. Software capabilities that once required large budgets to buy and many technicians to run are now within their reach. Given these opportune changes, CEOs, CFOs and other finance executives in midsize companies must take a fre

Right90 Shows the Right Way to a Trusted Forecast

2/19/2010 12:30:56 PM

It has long been expected that automation of the sales force could help address longstanding issues in the sales forecast. In practice this has not been the case. Likewise, you would assume that refining the management of potential bookings and revenue would be an organization’s top priority. This, too, has not happened; for many organizations creating the sales forecast continues to be a manual process of intense labor and data manipulation done within spreadsheets. The importance of the sales forecast to the financial and operational performance of a business is obvious; now gaining attention is the integrated business plan that finance and operations groups have been establishing, which my colleague has written about (See: “Integrated Business Planning – More Important Than Ever“). In creating the sales forecast and monitoring the continuous elements of the process, sales operations people need to do everything they can to accomplish integration, aggregation, approval and distribution of the sales forecast and to enable analysis of it as well.

This is the area where Right90 competes, offering an on-demand application as part of the cloud computing movement. It provides a sales forecasting application in the rental model of software as a service (SaaS), which makes the tool available not just for Sales but for finance and operations management to address the revenue performance of the organization. This broader focus and improving sales forecasting through dedicated tools is increasing in importance, as I found in our benchmark research on sales forecasting and demand planning. An acute issue is accuracy: Only 16 percent of participating organizations have 90 percent or better accuracy in their forecast, and in almost half of organizations people “game” the forecast to their own advantage. These and other findings lead us to advise sales, operations and finance executives to work collaboratively to make improvements. Right90 addresses this need with a set of capabilities that as well as core sales forecasting enables input directly from the source sales and account managers in its Sales Forecast Capture, statistical forecasting and integration of the forecast into Salesforce CRM, Oracle CRM, SAP and Oracle ERP. This mix of capabilities can help organizations improve their sales forecasting process.

The sales forecast can be an indicator of an organization’s sales performance, and this impacts manufacturing and operations functions, and if problems are known and addressed, it could dramatically improve the accuracy and value of it. Right90 has realized this and introduced new capabilities to apply analytics to the process. Last year the company introduced Right90 Change Analytics, which examines changes to determine why they have occurred and their impacts. These capabilities provide a consistent way to discover the drivers of change, which could be from specific sales activities, price changes, losses to competitors or changes in customers’ behavior. This step toward optimization and management of the forecast is followed by a new offering, Right90 Trust Analytics, which provides the means for any person in the organization to examine and perhaps improve the quality of the sales forecast through the application of analytics. This new application has a simple interface to determine the trust value of the forecast based on history or credibility and can be used as a key management method in the sales organization. T

Salesforce.com Brings Processes Visually into the Cloud

2/19/2010 12:21:25 PM

When salesforce.com makes a new product announcement, the world usually sits up and takes notice. The announcement of Visual Process Manager is in a lower key than most, but it is potentially significant for companies needing to build processes to handle customer interactions. Driven by what I suspect are smaller users of Force.com, Visual Process Manager provides tools to make application development for these purposes even easier. Experienced users of Force.com are already used to having point-and-click and drag-and-drop tools for building applications and Web services, but apparently salesforce.com didn’t think these went far enough, hence the launch of Visual Process Manager. It brings building applications into the domain of people who do not consider themselves developers.

However, I think it is important to point out that from what I have heard and seen, Visual Process Manager is not for building full-blown applications. Rather, it allows users to document processes and then have them turned into executable code that can run in the cloud or as a Web-based application. Salesforce.com made this clear during an industry analyst briefing, although the point is not so up front on its Web site, but it is clear that salesforce.com is not going into completion with business process management vendors such as Nimbus.

The product consists of four components: process designer, wizard builder, simulator and real-time process engine. The process designer lets users drag and drop different components of a process map into a design studio. They can include data input forms, decision points, calls to other applications to retrieve data, and processes to raise alerts or generate workflow items. Each of these can be modified to meet individual process requirements such as what data to collect or what data to extract from an external application, and thus create highly customized processes. Users can start from scratch or modify existing process maps. The other tools allow the process map to surface on a desktop, a Web-based application or both as a user interface that follows the course of the map.

I see this as particularly applicable to designing and executing interaction-handling processes, for example, how to handle a sales call or how to respond to an e-mail, or a simple application on a customer self-service portal. My benchmark research into customer experience management found that the majority of companies have yet to map these processes and instead rely on agents to use their experience to handle customer interactions. This can lead to some agents handling interactions differently from others and not all agents following best practises. Visual Process Manager allow companies to build such maps easily and thus improve the operations of their contact centers.

However, the product has limitations, the most evident being that it is only available to currently licensed users of Force.com, mostly because it uses other components of the platform to work. Pricing might also be an issue because companies have to buy a license for every user who builds processes and every user of a running process; thus, for example, a company with two employees building a process to be used by 100 agents would have to buy 102 licenses. This approach seems out of line. These caveats apart, I think Visual Process Manager is a simple technology that current users of Force.com could find useful for standardizing how relatively simple processes operate. It builds on the vendor’s momentum in servicing customers in their cloud computing environments, which require well-defined proc

Information Applications are Fast and Simple with Endeca

2/18/2010 1:50:51 PM

I had an opportunity to investigate first-hand the efforts at Endeca over the last six months after monitoring its activities over the last five years. I have completed a deep dive into the company, its products and its customers, which have been advancing nicely over the last decade since they started, and we now include it in our formal technology recommendations to our business and IT clients. At the core of Endeca is a unique platform that provides simple access to and navigation of information with a dynamic search capability for providing relevant results to answer business questions and make information available. Endeca has been steadily building a diverse list of some 600 customers that includes Borders, IBM, Ford, John Deere, The Home Depot and Wal-Mart. I want to do a quick review of this technology and what it does and point out where it can help your organization.

Endeca specializes in making information available easily to business users and consumers. Their information discovery approach through search and navigation among disparate sources of information is part of the new class of information applications that I have set forth in 2009 (See: “Information Applications: New Focus on Information Availability“) and which they have been advancing in the market. I have been researching the large gap between application development and business intelligence technology and found that organizations need a faster way to provide the ability to search and navigate to the information they need for a range of specific needs. I am also not talking about just search where the results are like what you get when you go to Google and type in a word. The Endeca platform is built upon the MDEX Engine, which provides a semi-structured database of crawler-accessible information that can be made available to the platform as part of an information application. Underneath this is what Endeca calls the Information Transformation Layer (ITL) that provides the ability to map and integrate a range of information across disparate sources. Endeca is also working with Informatica to make even more sources available to the platform more easily accessible, as they have announced. This technology partnership with them will expand further in 2010 by using Informatica to package integration and metadata dynamically; that will make it simpler for Endeca to access information. Informatica also plays a key role of making data in enterprise applications such as SAP available to Endeca, which has helped its business grow significantly.

Endeca provides for applications to be assembled in its Developer Studio that can support analysts as well application developers. Application development zealots will appreciate that Endeca can be accessed from within Microsoft Visual Studio or Eclipse-based environments. Endeca’s Workbench helps administrators manage access to and crawling of content to make Endeca work efficiently within the context of their environment and ensure that the information application has a custom interface that fits the needs of their users. The current release of the technology is Information Access Platform (IAP) version 6.1, and the company is working on the next major version (code-named Panama), which will improve performance and scalability for information processing and include analytics and visualization among many new capabilities. In addition advancements in the timely discovery and assembly of applications will make it even simpler for business to get these info

Coupa - Improving Spend Management and Insight

2/17/2010 2:54:29 PM

If you’re managing a company, a division or a department and you have to find a way to cut costs, show improved profitability or otherwise find some way of boosting reported earnings even a smidge, the sad truth is that there is never a single line item in the P&L statement captioned “fat and waste” that you can pencil out and be done with it. I was thinking about this recently as I was being briefed by Coupa, which offers spend management software.

Like most of managing, “better” is achieved by addressing a lot of little stuff. “Watch the nickels and the dollars will take care of themselves” is one way of putting it. But for most managers, addressing a lot of little stuff can be much too time consuming to be worthwhile unless you apply some sort of automation – either by having IT systems take over manual tasks, using IT systems to provide alerts when exceptions occur and manage their follow up, or some combination of the two.

For the past year many US corporations have be able to show robust profit margins as a result of the drastic retrenchment they put in place as a result of the financial panic during the fall of 2008. However, as the economy recovers, executives and managers will be challenged to find ways to expand while maintaining or improving their profitably as they add back less productive people. Keeping tight control on spending – especially the administrative, indirect kind – is one way to do this.

Spend management software – a category that includes outlays for administrative supplies and equipment (that is, anything that is not part of the cost of goods) as well as travel and entertainment (T&E) expense – has been around for more than decade but there are still plenty of companies – especially small and midsize organizations – that can benefit from adopting it. There have been a few major impediments to their doing so. Initially, the cost and hassle of managing an on-premises solution made this an option for larger organizations. However, this is a category that has largely moved to a SaaS delivery model and part of applications available in the cloud computing software industry. Second, there is a lot of inertia that keeps people thinking that it is cheaper to use spreadsheet or paper-based systems. Third, companies have not always been able to keep enough people using the system enough of the time to make it worthwhile.

As to the last item, one of the things that impressed me most about Coupa’s design is that it has a natural flow, incorporating many design features that make it easy for people to use. In this respect it follows the new paradigm for software design – it molds to the way people normally do things, rather than forcing users to adapt to a structure and flow dictated by the constraints of the software. It has the capabilities companies need for expense management so that managers can automate the process of watching the nickels. It monitors budgets; enabling managers to set spend alerts to warn when a specific threshold has been reached so they don’t go over budget. It can monitor spending for signs of fraud and automate expense report reviews to allow audit by exception. Rather than forcing employees to use only approved vendors and catalogs, it allows them to quickly get approval if they find a better deal. The benchmarking capabilities make it possible for executives to compare how they are doing; both in terms of what they’re paying for purchases as well as the efficiency and effectiveness of their processes (Are some managers too lenient in granting policy exceptions? Is it taking too long for others to give approvals?)

Spend management software is one those categories that continues to catch on – although it’s been at a slower pace than I thought five or ten years ago. It’s a category that makes

IBM Advocates Information Governance with Products and Services

2/17/2010 9:30:57 AM

I had a chance to attend the IBM Information Governance event, which brought together customers and influencers at roundtables to discuss the evolution of managing information assets and introduced new technologies to the market. This event is unique – a small, invitation-only event for industry practitioners under the auspices of the Information Governance Council, which works to advance the industry’s maturation of information governance from a data-centric point of view. IBM has supported this forum to drive customer dialogue and input in a concerted effort around the world to advance information maturity across all types of organizations. The scope of information governance for IBM is a broad framework encompassing content and data through a process to document, instrument, optimize and orchestrate content and data across the information supply chain. This approach is good as it expands beyond traditional data governance to a larger scope of content and data, addressing the entire life cycle of information management. This leadership by IBM will be a influence to our industry in the coming decade as most organizations are unsuccessful in managing their information assets optimally.

I listened to presentations and collaborated with IBM on their referenced specific research on information governance that found organizations generate 15 petabytes of new information every day, 80 percent of that being unstructured content. The research found that four out of five organizations see information as a competitive advantage but one out of two do not have access to the information they need. This situation is why I have been focusing on the category on Information Management and a new category of technology called Information Applications for simplifying the assembly and accessibility of information. In addition the IBM research found 14 percent of organizations to be sophisticated in information governance; our research found only 12 percent as innovative on the topic. This is clearly not a positive sign of organizations’ ability to manage information assets. Both IBM’s and our research and our work with clients reveal information consistency, lack of common definitions, regulatory pressure and resource constraints are common issues to address. Basically this means we all have a lot of work to do to improve the processes and use of supporting technology in this area.

This event got off to an early start with IBM’s announcement of intent to acquire Initiate Systems and bring its master data management (MDM technologies and experience to the healthcare and government industries (See: “IBM Initiates Deeper Healthcare Focus by Acquiring MDM from Initiate Systems“). This acquisition builds on IBM’s own MDM advancements that I analyzed last fall (See: “IBM Elevates MDM and PIM by Integrating Content and Analytics “).

But the larger theme of the event was managing the life cycle of business information – creation, storage, protection and use of it – in business across the information supply chain. IBM announced a new product to be released sometime in the future called InfoSphere Business Information Monitor, designed to provide database monitoring of unstructured data and content. The product will alert and notify users to what the presenter called information supply chain breakdowns before they impair downstream business processes. This technology leverages experience from IBM’s acquisition of Guardiam which addresses unders

Is a “Contact Center in the Cloud” a Reality?

2/16/2010 9:42:10 AM

It is over 20 years ago since I started working in the call center world. I started off in the systems integration world and spent my time working with companies to build what then were called call centers. These had several common characteristics in that they involved linking the customer’s ACD or PBX to a computer using call routing and computer telephony integration (CTI) software. This enabled the system to take calls and route them to specific extensions, and then pop a screen on the agents desktop telling them something about the caller. More often than not we integrated the CTI with a CRM system so the agent could capture the callers’ details and their issue, and then hopefully resolve that issue and close the CRM record. The last, and quite often the most expensive part, was to capture all the data we could, load it into a data warehouse and produce some reports. All of this was time consuming, pretty high risk, and expensive.

As time went on things became even more complex. Companies wanted letters, faxes and emails to be routed to agents in just the same way as calls – call centers became contact centers. In fact they wanted these other interactions blended in with calls to maximize the work time of agents. This introduced the requirement to integrate with agent workforce management so that the system knew which agents with what skills were available. Then one or two companies decided they needed to get smarter with interaction routing and we had to find ways to route calls not just to an extension but to an agent with the right skills, or depending who the caller was, or in very advanced cases to the agent best able to resolve the call. This all made reporting more complex, and some of the very advanced companies didn’t just want reports but they wanted quite complex analysis presented in highly graphical ways. You can imagine the impact this had on the time and cost to build one of these full functional contact centers.

But now if you believe all the hype from certain vendors building such a center is not only easy, it is cheap, First there vendors such as Altitude and Interactive Intelligence and offering fully integrated, software-only solutions which in effect provide a “contact center in a box”. These cut out all the integration issues and provide all the required functionality in a single, integrated system. These typically come with analysis tools which provide all the reports and analysis any company could need. Secondly companies now don’t even need to house the solution on their premises as vendors such as inCcontact, LiveOps and NewVoiceMedia are now “in the cloudould” i.e. all the hardware and software is housed and managed by a third party somewhere provider and companies need only to have Internet access to get at everything they need. If only it was that easy.

Over the last five years I have headed Ventana Research’s contact center research practicse focused on contact centers and managing everything related to an organization’s customer relationship and have carried out benchmark studies research into CC maturity Contact Centers, Use of interaction technology in CCs Contact Centers, Aagent Pperformance Mmanagement, Ccustomer Eexperience Mmanagement to name but a few. Overall these tell me the requirements remain pretty much the sa

Do You Do Strategic Planning or Just Plan?

2/15/2010 2:19:47 PM

In past posts I’ve focused mainly on the tactical aspects of corporate planning (including why companies must adopt integrated business planning) but haven’t spent much time on strategic planning.

Apparently, a lot companies have decided to swear off strategic planning for now. Actually, this isn’t really new news. Back in 2002, for example, the McKinsey Quarterly published “Tired of strategic planning?” The article cited the results of its research, which found that executives think the time they spend on the annual strategic planning session does not have much of a payoff. One business cycle later and I’m certain the results of a similar study would be exactly the same. Widespread dissatisfaction with strategic planning seems to rise during and just after recessions. Executives recognize their strategic planning process’s shortcomings after it turns out that trend extrapolation (which is what I think a lot of long-term planning really is) doesn’t buy them much in good times and is worse than useless at inflection points in their business.

When you begin to drill down into the issue, one of the big problems with “strategic planning” is that the term is used to mean two related but different activities: one is strategy review and development and the other is long-range planning (this can mean 2-20 years, depending on the nature of the business). “Strategic” planning (in the sense of developing strategic approaches to guide a company’s objectives and tactics) and “strategic” planning (meaning the longer-range, non-tactical kind) are related because it’s essential to develop strategy within the context of assumptions about the world as it will be – market conditions, competitive structure, technology and so on. And it’s necessary to make formulate long-term plans in the context of a company’s strategy.

Although the activities are related, Henry Mintzberg’s view on “strategic planning” is that the terms is an oxymoron – that the two don’t go together particularly well. This is because planning is a formal process with a fixed outcome while strategy development is most successful when done in an unstructured environment. This observation is a bit academic (Mintzberg is, after all, a professor) but it’s a good point.

So, when you take into account the failings of both the strategy development and long-range planning aspects of “strategic planning” it’s not too hard to see why executives are frustrated. The solution, though, is not to abandon strategic planning but to understand how best to use it. Although a concise statement of strategy and some sort of high-level published plan are necessary work products, the focus must be on the process, not the print-outs. Strategic planning is most useful for ensuring that everyone is on the same page. It’s having everyone in the room kicking around the possibilities and how best to respond to them. It’s quantifying the scenarios to be able to see their potential consequences on the financials, on market share, the supply chain. It’s a forum for the strategic aspects of enterprise risk management. If the objective is on the end product (the natural inclination of successful, goal-seeking executives) the discussion will be too narrow. As a result, it will fail to anticipate discontinuities in the business environment and therefore be worthless as a plan as well as miss opportunities to successfully shift a company’s strategy (and tactics) to exploit what is likely to be a momentary opportunity.

Planview has announced that it had broadened into the will be entering the operational planning software market with a solution that is designed to span the three major pillars of planning: operational, strategic and financial planning (i.e., budgeting). I think such a product fills an important hole in the planning market, especially for companies divisions or departments with what you might call a “multi-task” business model.

I’ve been pointing out the need for companies to adopt Integrated Business Planning and change their focus from budgeting to planning. People, especially those that work in finance departments, tend to use the words planning and budgeting interchangeably. Indeed, in order to prepare their budget, managers must plan. Yet, planning is only incidental because the focus of the effort is on preparing an annual budget, not creating an integrated company-wide operating plan.

Planning and budgeting, although related, mean two different things and have different aims. The inherent purpose of planning is to succeed in achieving an objective while the purpose of budgeting is to not fail (that is, lose money or run out of funds). Planning is (or needs to be) an open-ended exploration of what’s possible. Budgeting is about fixing amounts to achieve financial control. Planning must be a dynamic process because business conditions are always changing and plans have to adapt to fit changing circumstances. Budgets and strategic plans are more static. Budgets, because they are a control mechanism – you can’t keep changing the yardsticks and moving the goalposts; strategic plans because of their long-term focus. Budgeting is a form of financial planning and it is a critical element of financial controls. Well run companies must budget and use this as a measure for ensuring sound fiscal control. However, budgets are a poor blueprint for managing a corporation. The budget may function reasonably well as a financial control, but it has little value as a business plan. Plans focus on things (LTL shipments, FTEs, production units, marketing campaigns and so on) and then their monetary consequences; budgets are only about money. As a consequence, operating units and departments create their own, silo-based plans that are poorly coordinated. Integrated Business Planning makes better use of information technology to shift the focus to explicitly planning the operations of a company and then derives a budget from that plan.

People use the terms planning and budgeting interchangeably because in practice corporations collapse the two processes into a single effort – preparing the annual budget. This is an artifact of a different era, when information technology tools either didn’t exist or were limited in what they could do. Twenty years ago almost all of the “numbers” that operating managers could readily access came out of accounting systems. Today, there are a wealth of systems that collect operating data from sales, customer service, product development, manufacturing, supply chain, maintenance and so on.

Habit is one reason why companies stick with the budget-as-operating-plan approach. It’s time to break the habit.

Planview’s point of differentiation is in its ability to handle multi-task operational planning, which differs from other forms of operational planning in several key respects:
• The underlying businesses model is made up of discrete, custom or semi-custom efforts rather than repetitive defined processes
• These efforts require the execution of multiple, parallel threads of activities to achieve completion
•

Informatica Demonstrates the Value of Data for Every Organization

2/12/2010 7:39:26 AM

At its 2010 global analyst summit, Informatica reviewed its business and technology strategy, emphasizing data integration and seven supporting technologies. The company has built a $500 million business in 26 countries with over 4,000 customers and has made five acquisitions in recent years. Informatica is bullish on the information economy as I outlined in 2008 (See: “Informatica Bets Big on Information Economy“), and Version 9 of its flagship platform supports it with data integration and data quality (See: “Informatica Brings Business and IT Together for Your Data in Version 9“) for the enterprise. I just finished analyzing Informatica efforts in deepening their efforts in cloud computing (See: “The Sky is Bright for Informatica in Cloud Computing”) which have progressed significantly in 2009. Informatica has also taken on new acquisitions like Siperian with MDM recently to advance their capabilities in providing consistent data across enterprise. I have seen for many years how Informatica does much more than data integration; its challenge is to make clear the broader focus and value they provide in the utilization of data in an enterprise for business and IT.

At the summit Informatica touted its achievements across their business objectives including financial plan targets. It has expanded geographically, with operations in 26 countries, development in 12 countries, support in 10 countries, and services professionals in 19 countries. Informatica continues to be known for its customer satisfaction through global customer support and has grown its partner ecosystem, with 26 percent of revenue sourced by partners and 63 percent of revenue influenced by them. Informatica’s product leadership is reflected in recent release of version 9, and it is furthering the mission of enabling the data-driven enterprise by supporting customers’ needs for globalization, consolidation, growth, risk mitigation and governance that I would agree are critical imperatives driving a range of technology adoption but most importantly need direct support for a range of priorities including improve decisions, modernize business, improve efficiency, M&A, acquire and retain customers, outsource non-core functions, GRC and increase partner network efficiency. Informatica also has been working to get business and IT to collaborate more to improve the availability, quality and integration of data and to provide more timely data through its service-oriented architecture (SOA).

While continuing internal development efforts, Informatica has continued to expand its technology portfolio and its global footprint through acquisitions. Recent acquisitions include AddressDoctor for address validation; Applimation for information life cycle management; Agent Logic for operational intelligence and complex event processing (CEP); Siperian for master data management (MDM) (See: ”Informatica is a New Master in MDM with Siperian Acquisition“); these complement with the previous acquisitions of Similiarity for data quality; Striva for mainframe connectivity; Itemfield for B2B data mapping; and Identity Systems for identity resolution. Informatica Identity Resolution provides prebuilt matching for 60 countries and can be invoked in real time using the Agent Logic software. In addition, the latest release of AddressDoctor supports geocoding, multithreaded engines and improved parsing and validation across 240 areas of the wo

Verint Deepens Agent Performance Management

2/11/2010 3:31:50 PM

Verint is well known for its comprehensive suite of products that support agent performance management. My benchmark research into agent performance management showed that to properly manage the efficiency and effectiveness of agents handling customer interactions companies need to deploy smarter call routing, call recording, quality monitoring, workforce management, training and coaching management, agent compensation management and a comprehensive suite of agent-focussed analytics and performance management. Over the years Verint has built a portfolio of products, Impact 360 Workforce Optimization to support APM, at the heart of which is two strong analytics products, Impact 360 Data Analytics and Impact 360 Speech Analytics. With the latest acquisition of Iontas, Verint has strengthened its analytics capability even further by adding the ability to analyse how agents are using their desktop, known as desktop analytics.

The Iontas product can capture what agents are doing at their desktop; which applications they access, which data fields they use, how they navigate between applications etc. This allows companies to see exactly what their agents are doing as they handle different types of customer interactions. Analysis of this usage makes it possible to spot the most common ways agents handle interactions, and indeed which agents are driving best practises. Furthermore this analysis can be input for agent training/coaching needs analysis and even more broadly into how to optimize the process for handling different interaction types, both of which can have a significant impact on key metrics such as average handling times, customer satisfaction scores and agent performance metrics.

The ability of the Iontas product to help optimize interaction handling processes takes Verint into a new area. My benchmark research into customer experience management found that while some companies had documented the processes to handle interactions, many had not done so and those that had recognised the need to improve. The Iontas product has tools to help companies map interaction flows, and then using the desktop analytics, companies will be able to optimize those flows and subsequently improve the desktop they provide agents with. Most of my research benchmarks show that the agent desktop is a major contributor to poor agent performance; pushing up call times as agents have to navigate anything up to 20 applications, reducing customer satisfaction as agents take longer to provide them with the information they are seeking, and increasing agent training times simply because the desktop is so complex. This advancement deepens Verint to further compete in agent performance management which is now becoming a significant demand to optimize the effectiveness of agents towards customer and financial objectives. So companies wanting to address this key issue would do well to assess how this new addition to the Verint Workforce Performance Optimization suite for agent performance management could help them in their efforts.

Essential Priorities for Finance Departments in 2010

2/11/2010 3:07:18 PM

Our work at Ventana Research has outlined the importance of effective use of technology for business (See: “A New Decade and Technology Charter for Business and IT Starts in 2010”) and as my colleague has referred as the necessity of finance to lead the proper application of technology for financial performance (See: “Smart and Effective Finance in 2010”). Finance departments in North America and most of Europe will be heading out of their collective “heads down” survivor mode they began to adopt 18 months ago in the wake of the financial crisis. They are beginning to adapt to the “new new” realities of the current economic recovery and – in the United States – a more complex and taxing regulatory environment. Information technology will continue to offer corporations solutions for managing their finance departments and finance related functions not just more efficiently but – of greater importance - more effectively as found with financial performance management. Here are some of the most relevant issues that I think are of greatest importance to assess and improve:

• Managing profitability – There were recurring surprises to Wall Street analyst earnings projections throughout 2009 related to North American-based companies because these companies slashed spending at a much faster rate than they had in past recessions. As North American and European companies emerge from the recession, maintaining margins will be a focus. To be sure, holding the lid on spending will be popular, but we expect an increasing number of companies will start looking for more intelligent ways to address the issue. Depending on the nature of its business and its particular strategy we see an increasing number of companies developing customer and product profitability disciplines and the underlying analytical capabilities (such as activity-based costing ) to support these efforts. They also will need to use “talent management” to ensure that they add headcount in the most cost-effective way.
• Planning, not just budgeting – Companies have found that their ponderous annual budgeting process was not suited to a period of economic volatility as several years in a row they found that these documents were dead on arrival at the start of their fiscal year. More companies will be focusing on integrated business planning (which includes workforce to increase their responsiveness to changing business). Increased agility is a way to take better advantage of market opportunities (increasing revenues) and avoid unnecessary costs (enhancing profitability). Improving the planning process also involves better use of analytics, especially predictive analytics. Improving planning also means improving cash management and better, more granular visibility into cash flows.
• Analytics – Over the past decade, corporations have invested billions in applications that collect an ever wider array of operating data as well as ways to make this information accessible. Moreover, software that makes predictive analytics (those that borrow a variety of techniques from statistics, game theory and data mining to improve forecasts of future business outcomes) used with a richer set of operating and financial data requiring the improvement of the quality, accuracy and timeliness of information for activities like business planning.

The Sky is Bright for Informatica in Cloud Computing

2/10/2010 2:28:31 PM

The steady increase in number of business applications that operate outside the firewall – through software as a service (SaaS), commonly called cloud computing – forces organizations to integrate data outside of the enterprise and then back into it. This is true whether the organization uses a privately managed cloud or the rapidly expanding public clouds, where more companies subscribe to a portfolio of business applications and tools every day. Sales, marketing and human resources organizations that have embraced SaaS find themselves with limited ability to integrate their dispersed data to gain visibility and efficient use of their processes. This problem also has grown in Finance, which is not able to apply analytics to employee and revenue data, and operational management, which is not able to unify marketing and sales information with customer information in efforts to implement a range of operational efficiency and performance improvements. CIOs and IT management have gotten involved to address these needs for integration and data management. This data issue is expanding into data governance as well; our recent benchmark research found that over one-third of organizations will move data governance to the cloud within two years. Ventana Research asserts that usage of data integration and supporting technologies is an area IT must progressively address in 2010 (See: “Optimized IT and Focus on Information Technology in 2010”). IT also must find methods to improve cooperation dramatically across business and IT (See: “Using Innovative and Disruptive Technology in 2010”).

For two years Informatica has been advancing its data integration technologies to operate in computing environments outside the enterprise, including business process outsourcing (BPO) and software as a service, which are part of the Informatica Cloud business launched in 2009. I have been assessing these efforts since they started and reviewed in depth as part of my broader analysis in Informatica’s analyst summit. Informatica is focused on three major areas in cloud computing. The first, called Informatica Cloud Services, helps business and data analysts integrate data from their in-house environment interactively with applications and data in the cloud. Second, the Informatica Cloud Platform is for developers and software vendors to build cross-company environments for data integration more easily. The third is the Informatica Cloud Editions and Options for IT organizations to manage interchange of data between enterprise and cloud computing environments. Informatica has designed this architecture to operate through secure agents that can manage the connection between the two environments. Each of these three areas brings technology and service advances.

Informatica Cloud Services takes a simpler approach than the enterprise Informatica PowerCenter designed mostly for IT, being Web-based and using a wizard to integrate enterprise data into cloud-based applications. Its six steps are: define data, source data, define target for data, establish data filters, define field mappings and schedule the integration job to execute. The simplicity and usability of this approach earned it a number-one service rating in the salesforce.com AppExchange of integration services. Any business or data analyst who has basic knowledge of data and logic can use it to transform data into a target location for the data. Informatica has seen significant growth of customers using this service, including Qualcomm, Toshiba and MorganStanley.

Informatica Cloud Platform extends support to software provide

Informatica Advances “The Single View of the Customer”

2/9/2010 12:03:47 PM

My colleague, Mark Smith, the EVP of Research, has already done a good job assessing the market and technology side of Informatica’s acquisition of Siperian (see” Informatica is a New Master in MDM with Siperian Acquisition”) After talking with one of Informatica European operations vice president Mark Seager, I’d like to add a slightly different perspective. There is no doubt in a tough economy Informatica’s performance in 2009 was very impressive, but what has driven that growth? My research and clients tell me this is not just IT but business driven demand for managing and optimizing customer relationships where the demand for customer related data and information is pressuring organizations to invest further.

Like me, Informatica has seen volumes of its clients and prospects becoming much more focused on customer retention rather than new customer sales, and in order to drive customer retention initiatives companies need to know more about their customers. As my research into customer information management and my personal point on mastering customer data (See: “Master Customer Data or Lose Them”) this is a major issue for companies as they have so many sources of customer data, in so many diverse formats that accessing it all to create a single view of the customer is highly complex. A major factor in Informatica’s success has therefore been greater demand for their products that allow companies to gain access to structured and also unstructured data (content and text based) and data outside the company’s firewall (either in cloud-based applications or partner hubs).

In the same context, the acquisition of Siperian is a very logical step – Informatica and Siperian have been working together through deployments and use of their technology for many years, the Informatica products are key components for building a complete MDM solution, and Siperian has the software to build a MDM hub. When it is fully ready the combined products will provide a platform and tools to build a high quality, synchronised, single source of customer data that companies will be able to rely on the drive customer-centric decisions and actions. For Siperian customers in particular the question is always going to be “when” and what will be the impact on my existing Siperian-based solutions. Not surprisingly at this stage there were no answers coming forth as to “when” but given the past experiences of working together and assessment work already done, the integration task was described as “not massive” and a roadmap should be forth coming quite soon. Meanwhile Informatica will be supporting all existing customers but they will be encouraged to migrate to the new solutions as soon as practically possible.

One thing companies should not ignore as they embark on any initiative to improve the quality of their customer data and information is the political and process barriers that will get in the way; in fact if anything these can be greater than the technical issues. The combined professional services teams of Informatica, Siperian and their partners will therefore be a powerful source that companies can draw on to overcome these issues.

There is a lot of talk at the moment of companies needing to become more customer-centric and to focus more on customer retention than the mad dash of recent years to just acquire new customers. To drive these initiatives companies need a better view of their customers which needs to be based on what some call a “single, golden source of customer data”. The latest versions of the Informatica products, Version 9, as my colleague has analyzed (See: “

New CEO Heads of SAP Anointed but More Change Needed to Adapt and Grow

2/8/2010 5:12:54 PM

The National Football League (NFL) and the big annual event called Super Bowl Sunday in the United States was abruptly superseded by the announcement of the contract termination and resignation of SAP CEO Leo Apotheker. Simultaneously the promotion of Bill McDermott, head of global field organization and Jim Hagemann Snabe, head of global product development were promoted to Co-CEOs as has been customary in past years. A dramatic change in such a short period of time since Leo Apotheker took the reigns as sole CEO of SAP just less than a year ago. Just last year Leo was on stage as the last CEO, Henning Kagerman left SAP and was part of my analysis (See: “SAP Communicates New Clarity for Business at SAPPHIRE”) and my colleagues analysis (See: “What Leo Apotheker from SAP Should Have Said”).

In a very quick move to shore up the industry rumor mill and spread of misinformation was an early morning conference call with the chairman of the board and co-founder of SAP, Dr. Hasso Plattner to briefly discuss the transition and address as many questions as possible across industry and financial analysts. There has been significant pressure in both Germany and investors around the world as Dr. Hasso Plattner outlined the three attributes of their strategy that are growth, innovation and margin which is obviously mandatory to adapt and grow SAP in a positive direction. The tone of the conversation by Hasso was a little mixed and was more defensive than re-assuring. The focus on ensuring ‘Trust’ with customers to stay committed to SAP and to not abandon a roadmap of solutions including upgrades and improvements using SAP was a strategic point by Hasso. The second point of emphasis was on ensuring growth and profitability through SAP being a ‘happy company’ which requires happier employees. In the questions and answers section it was revealed the employee satisfaction and annual survey of employees was not up to the level of executive board satisfaction. I was quite surprised to the level of detail on these trust and happiness issues which most of us know about at some level but was thinking the chairman would acknowledge issues quickly and then have a more positive position on the portfolio of opportunities in front of them. This reveals the issue is much larger than most of industry folks who cover SAP closely have realized.

Hasso on his pointed did provide some points of confidence on SAP investment to R&D and move to more agile product teams and that business decisions related to products need to be more swiftly executed and deployed throughout SAP. An emphasis on a range of advancements for usage of in-memory computing to SAP DB with SAP Business ByDesign and a reference to SAP BusinessObjects are part of what he believes will help the agenda at SAP. I actually see SAP has made many good advancements across their enterprise software portfolio and applications strategy that I have recently addressed (See: “SAP Broadcasts New Enterprise Software and Application Strategy”) along with advancements in BI (See: “SAP Brings Business Intelligence and Business Analytics Advancements to Industry”), solutions for enterprise class performance management and GRC (See: “SAP Promotes Value of EPM and GRC at SAP Reporting Conference“) and their On-Demand offering called SAP Business ByDesign that my colleague analyzed (See: “MicroStrategy, a leader in the business intelligence (BI) market, recently added an array of new capabilities, performance and scalability to its product suite (See: “MicroStrategy Brings Future Vision and Reality of Business Intelligence to Customers”). I had a chance to review in-depth how these new capabilities apply to BI running on top of SAP BW, formally called SAP NetWeaver Business Warehouse. MicroStrategy has expanded the range of BI products that integrate into applications from SAP (See: “Leverage Every Transaction from SAP for BI”). This use of BI has great potential, as the insights from applying analytics and building metrics and key performance indicators are essential to achieve operational and financial performance goals and objectives.

MicroStrategy Version 9 brings to the table a range of methods to integrate with SAP as part of the MicroStrategy Solutions for SAP. They range from supporting robust reporting, analytics, dashboards and applications that access SAP BW to integrating BI into SAP Enterprise Portal. Its MicroStrategy SAP Services also offers support from within SAP NetWeaver Visual Composer to integrate data with SAP BW. MicroStrategy meets the criteria for SAP Certified NetWeaver integration, following the approved integration points defined by SAP. Its MicroStrategy Intelligence Server integrates to SAP BW through a technology standard for data access called MDX. MicroStrategy uses a Java-based connector to pass MDX to the online analytical processing (OLAP) interfaces of SAP BW, which allows it to operate across Microsoft- and Unix-based platforms.

Accessing SAP BW this way, IT staff or analysts using MicroStrategy Data Explorer can browse metadata structures such as cubes, hierarchies or attributes from SAP BW to assemble similar business metadata within MicroStrategy. It is simple to visually browse and map logical data structures between the two technologies. This approach enables the rapid integration and use of existing SAP BW InfoCubes and associated business queries that the user organization might have spent significant time to develop. To make the business metadata available in SAP BW from MicroStrategy requires only checking a box in SAP BW; an administrator can make it available for discovery by ODBO, which is turned off by default. MicroStrategy also can inherit presentation and display formats from SAP BW, along with pre-existing security and authentication in SAP BW to authorize access to existing investments. Of course, in mixed environments blending data from SAP BW and other sources will require a higher level of security than can be managed within MicroStrategy. Currently MicroStrategy does not directly read and map to the “atomic” level of detailed data in SAP BW called the operational data store (ODS), but it can use or create queries based on SAP BW InfoCube to the ODS.

Once mapping from MicroStrategy to SAP BW is complete, you can use all the capabilities of MicroStrategy to design and publish reports, assemble dashboards and build in-memory cubes with MicroStrategy OLAP Services to access with MicroStrategy Office, which establishes access to Microsoft Excel or information from MicroStrategy’s RIM B

SuccessFactors Acquires Inform for Workforce Analytics and Planning

2/8/2010 12:55:29 PM

SuccessFactors has taken a big step forward in the market for helping organizations manage their workforce’s performance and maximize the value of talent by acquiring Inform Business Impact. Originally named Infohrm, the company has been operating for 28 years, much longer than SuccessFactors, and has specialized in the last decade in selling software and providing best practices in the area of workforce analytics and planning, as well as offering benchmarking services. Having changed its name from Infohrm, which reflected its focus on HR customers, to Inform Business Impact was a move to indicate their broader focus and appeal. I find this acquisition very relevant as it places more emphasis on workforce analytics and planning, which are core tenets of what is called workforce performance management, an interest of mine for over 15 years.

Now Inform becomes a core component of what SuccessFactors recently classified as Business Execution Software, which I analyzed in 2009 (See: “SuccessFactors and Business Execution Software: Confusing or Confused?"). That shift by SuccessFactors was an effort to expand beyond Talent Management for HR and emphasize both business alignment and people performance for other areas of the organization; this acquisition is a further step in that direction. SuccessFactors is serious about expansion, as shown by the cost of the acquisition – over $25 million in cash and approximately $15 million in stock. SuccessFactors already has been successful in growing its core business of helping organizations manage performance through goals, performance reviews, compensation, rewards, succession and recently announced recruitment. Its recent fiscal year 2009 results indicated strong growth in the form of over $62 million in bookings in the fourth quarter and over $153 million in revenue for 2009. SuccessFactors also introduced a simpler method to migrate to performance reviews with EasyReviews, which is priced to be affordable for organizations of any size.

As well, SuccessFactors had recently brought to market Metrics Navigator for analysis of critical metrics, a necessary part of workforce analytics. Now Inform strengthens its foundation of planning and workforce insights from both historical and predictive analytics; it also brings reporting and a portfolio of thousands of metrics and benchmarking statistics applicable across 20 industries. Inform had grown its business to over 130 enterprise customers that apply its analytics to over 2.5 million employees. My assessment after tracking Inform’s software over the last five years was that it is functionally rich and had begun to become more useful for people who were not analytically savvy; the greatest value of the organization, however, was in its industry expertise and community of practitioners.

The combined SuccessFactors and Inform competes with vendors that combine workforce analytics and planning, including Acquire and Softscape and a new generation of workforce analytics from recently merged Peopleclick and Authoria (See: “Seek Innovation and Optimization in 2010 at the Intersection of Business and Technology”). The lines of business must examine methods for using technology to innovate and to optimize if the organization is to maintain a competitive edge. The dual perspectives for these examinations should be business value and cost avoidance, looked at quarterly and with a two-year horizon; as well as the obvious need to address the “here and now” of business, you must keep an eye on the rapid change in technology, which today happens much faster than traditional three- or five-year investment plans can accommodate. You also need to be “disruptive” of the usual practices sometimes, which for some organizations means establishing weekly review cycles using business intelligence to evaluate operational effectiveness instead of waiting for monthly and quarterly cycles; for others being disruptive could be using social media to gain direct customer feedback and interaction through Web sites such as Facebook and Yelp. Similarly I have also seen how "crowd-sourcing” across your workforce or even your customers can simplify the process of getting visibility into your activities, daily or strategic, and gleaning insights into your business. However you look at it, disrupting your habitual activities and processes, or disrupting your industry and surprising your competitors, should be part of what you strive to accomplish in 2010.

Every organization needs to operate smarter and find methods to be more intelligent in the business activities that undermine the responsiveness that is a key to efficiency of individuals. The barrier typically is a lack of knowledge about what is happening, and that will impact an individual’s or a department’s operations or performance. In many cases the proper use of analytics that are predictive in nature can address this issue. So can using technology that tracks problems as they happen through the use of business events, which are triggered every millisecond across the network from your many applications and systems. This is what we call Operational Intelligence; complex event processing can monitor and identify issues and opportunities and correlate them to policies and rules established by the business. Other organizations can gain knowledge of what needs to be done with applications that bring goals, objectives, metrics and specific capabilities together. Then they follow up with the insights and plans to achieve them using integrated business planning in conjunction with performance management applications.

Several broader technology approaches could help business or IT in this effort. One is cloud computing, which brings capabilities to business user in a quick and efficient manner by renting you the software when and for whom you need it. Also using cloud computing you can connect over the Internet people who want to share knowledge, which requires turning social collaboration into business collaboration across the enterprise. Traditionally this technology would have to be installed in the enterprise itself, but cloud computing makes it available in a simpler method. Similarly you can meet the need to provide information and applications wherever people are operating through consumer-focused mobile technologies such as the Apple iPhone, Google Android and RIM BlackBerry, along with new generations of tablet technology like Apple’s recently announced iPad. Speaking of simple and necessary, a new kind of information application is ensuring availability of information through applications designed to meet specific needs of consumers, customers and the operational elements of an organization.

Using technology wisely is no easy task; varying opinions, experience and just plain

Optimized IT and Focus on Information Technology in 2010

2/5/2010 10:29:06 AM

You recognize your responsibility to advance the competency and maturity of your IT organization through technology (See: “Seek Innovation and Optimization in 2010 at the Intersection of Business and Technology”). The role of IT and leadership by the CIO have become more difficult as the complexity and abundance of technology have grown dramatically in the last decade; this decade will make current systems obsolete faster than ever before. But IT systems have to be more than cheaper and faster, becoming better and smarter in their ability to deliver value to the organization. Part of doing this is knowing what business needs from applications and tools, and that includes understanding how and what they are actually using – that is not always what IT thinks they are using, particularly now that renting applications via software as a service (SaaS) is growing, not to mention the custom applications and spreadsheets that dominate business use of technology. IT needs to examine these issues and make strategic decisions on buying and using software tools by looking at approaches beyond on-premises, such as open source and cloud computing through SaaS. Simultaneously it has to better understand business adoption of mobile technologies such as Apple iPhone and others that make business computing more accessible and simple regardless of support from IT.

The CIO and IT staff need to manage their portfolio of technology as a business asset, not a collection of systems vendors’ technologies and people who manage them. To get to this point we advise applying performance management to the IT function and establishing portfolio management and planning processes that use systems designed to support the complex needs of managing assets, projects, resources and tools. At the same time they have to better coordinate applications and tools for managing IT governance, risk and compliance (GRC) still need as extend them to finance and operations. To do this requires a portfolio of information-related tools and applications that can help do everything from information monitoring, security and search to eliminating the dependence on inefficient and risky spreadsheets and e-mail. Simultaneously IT needs to address its own sustainability efforts and treat it as an opportunity to reduce the cost and burden of technology for the business and our environment.

IT has been effective in advancing the art and science of information management and the use of data warehousing and business intelligence for the rest of the organization. But IT has not done a great job of using it in its own area of focus. Yet there are an array of useful types of tools to help in this process. It’s time to use analytics and metrics on IT data more efficiently in this role and responsibility. IT now has realized that investments into data governance and dedicated technology to support it, including data integration, data quality and master data management, are essential for managing data and content-related assets effectively. Being smart about the management of data requires deciding if the most intelligent processing and storage of data can come from dedicated appliances to reduce time and resources. The specialization of analytic databases also can help to operate specific aspects of the business. Harmonizing the management and integration of content and data assets into a full life cycle and an overall information demand-and-supply chain is mandatory. This foundation is important to provide trusted information from analytics and business int

Sales and Marketing Operations and Management in 2010

2/5/2010 10:24:53 AM

You recognize your responsibility to advance the competency and maturity of your sales and marketing organizations through technology (See: “Seek Innovation and Optimization in 2010 at the Intersection of Business and Technology”). Entire industries realizes the inefficiency in sales and marketing while expecting the best possible performance. For decades organizations have been using now-aging applications for sales force automation and marketing automation that often had also been put together in a generic packaging called customer relationship management (CRM) that looks for integration on specific tasks of automation and pays less attention to the management and oversight of operations to goals and objectives. That has to change if these functions are to improve performance. Marketing needs to invest into brand and category management applications that can improve coordination and effectiveness in the mission of advancing market share, profitability and customer value. A new generation of applications has appeared in the last five years to help organizations optimize and manage to desired results. In sales, the portfolio of applications are brought together in what is called sales performance management, which includes sales-related applications like pipeline, forecasting, coaching, incentives and territory optimization, which together can drive up effectiveness for sales executives, sales operations and individual sales managers. Now the challenge is to balance these improvements from presales activities that assist in managing opportunities to the close and then the post-sales activities including sales compensation and customer fulfillment.

Marketing executives need to reassess their processes and associated metrics to ensure they are not laggards in these efforts. New means of expanding the brand and connecting with customers and consumers are available through social media channels and other methods on the Internet that can be enabled via task-specific information applications. Marketing executives in all industries must see that automation and the use of forward-looking as well as historical analytics are relevant to their revenue contribution and ultimately their career survival. A resurgence in marketing and sales is possible with lead nurturing through scoring and automating interactions with prospects through advanced marketing automation solutions. Using data to establish metrics for insightful key performance indicators is an essential tool for advancing organizational maturity; another is being effective in adding geographic contexts to marketing and sales through location intelligence. Acquiring a view of activities outside of the organization, along with competitive and market-related information, will assist optimization of marketing strategies and operations. Marketing executives need to take a leadership role, ensuring accuracy in marketing and sales products and services through product information management (PIM) tools. Joint activities and improvements through technology will help align marketing and sales to reach their objectives much more efficiently.

It’s time for the art of marketing and sales to become the science of best practices and processes that arm the entire organization with information and capabilities to meet specific customer and revenue objectives.

Let me know your thoughts or come and collaborate with us on LinkedIn

Operations in the Workforce and Supply Chain of Products and Services in 2010

2/5/2010 10:21:10 AM

You recognize your responsibility to advance the competency and maturity of your operations and workforce organizations through technology (See: “Seek Innovation and Optimization in 2010 at the Intersection of Business and Technology”). Optimal performance will be found in a delicate balance of people and their relationship to the supply chain of products and services, which is the backbone of every operation. To get more than mediocre results requires moving away from conventional wisdom and manual execution of repeatable processes that could be hindering better results. Change starts at the top with establishing excellence in managing performance; that requires an understanding of how systems can support an efficient process to align, optimize and understand performance across the workforce and operations. This focus should be built on integrated business planning (IBP), which can link the complex network of budgets, operations and performance, including forecasts and demand plans, in a seamless manner. The planning processes also needs support from insights on risks and required governance to minimize issues that could arise. Most of these tasks can accomplished by effective use of performance management applications that support planning and classifying risk through specific, trackable metrics and key risk indicators (KRI).

The unique aspects of managing a workforce involve a great amount of detail to ensure that all individuals are inspired to do the best possible job and can fulfill their commitments to their positions. Transitioning from the traditional human resources management system (HRMS) to talent management is imperative to doing business effectively and requires investments in the applications that support it. I believe that organizations dedicated to becoming really effective will commit to linking performance, compensation and incentives to the associated objectives. Tightening cost controls has become easier with new expense and spend management applications that can be onboarded easily through software as a service (SaaS) in which applications are rented only for those who need them. Sustainability from both management and informational perspectives will rise in importance, beginning this year.

Established technologies such as business intelligence (BI) and data warehousing should be combined with data quality and integration technologies to build a common view of information through master data management (MDM) and data governance processes. the increasing mobility of the workforce will require not only nimble use of mobile technology but interaction with the workforce through business and technology event-based operational intelligence and tightly focused information applications that can simplify business collaboration through a range of data and text. In all cases curtailing the use of spreadsheets and e-mail within a focused business technology perspective will help drive more efficiency and improve time to clarity. Better use of planning systems and management of assets and resources within the IT portfolio will contribute to higher profitability and realization of expected outcomes.

The right set of applications and information can further the goal of achieving the best possible operational performance from efficient processes and focused activities of the workforce.

Let me know your thoughts or come and collaborate with me on Seek Innovation and Optimization in 2010 at the Intersection of Business and Technology”). To realize the full potential of the customer relationship requires more than improving operational efficiency; it includes utilizing technology to help ensure optimal customer satisfaction through the process of customer experience management (CEM). Contributing to CEM is the ability to manage several channels of communications and support interactions electronically through unified communications directly integrated in a multichannel contact center. Unified communications also make it easier to manage physically present, virtual and at-home agents who interact with customers across the multiple channels; this we call the agent performance management. It requires the precise levels of support for coaching and incentives to adjust the behavior of agents as they work to achieve critical metrics such as first-call resolution (FCR) that contribute to key performance indicators (KPI) in many call centers.

This advances are not likely without the aid of better analytics and planning. These include both historical and predictive analytics and capture of actual customer sentiment through analytics through analysis of spoken interactions and text that is written in e-mail, online forums and the Internet. The information and data assets should be managed through data governance and supporting technologies such as data quality, data integration and master data management for both customer data and product information management. Going farther, to innovate requires use of geography and analytics to produce location intelligence that can tell where customers should be engaged or may be acquired. Targeted information can be made available to consumers and customers through information applications be available on the Internet, including through social media channels, and via mobile technology.

Your business obviously depends on the customer asset. It is not wise to ignore investment in information and technology to optimize the interactions, experience and outcomes of your relationships.

Let me know your thoughts or come and collaborate with us on LinkedIn and Facebook.

Regards,

Mark Smith – CEO & EVP Research

Smart and Effective Finance in 2010

2/5/2010 10:10:54 AM

You recognize your responsibility to advance the competency and maturity of the finance organization through technology (See: “Seek Innovation and Optimization in 2010 at the Intersection of Business and Technology”). Advanced intelligence in Finance has moved well beyond the financial close and the budget process and into integrated business planning (IBP) to emphasize profitability and mitigate risk through business processes that span the organization. New applications also help assist in the management of taxes and expenses throughout the business. Technology for enabling better analytics in finance is now widely available and essential for replacing spreadsheets and antiquated reporting tools. As for reporting, the simplification and standardization of reporting formats is now possible using XBRL, which provides a standard framework using the XML technology standard for publishing information to other businesses and for regulatory reporting requirements to the SEC and other bodies.

The role of finance has expanded to help drive new methods for operating business in a more efficient manner through sustainability initiatives. Applications that are rented instead of purchased through software as a service (SaaS) and as part of the broader cloud computing trend can spare critical IT resources and speed time to utilization within the business. Finance can even play a key role in supporting the use of information and technology throughout the enterprise to find opportunities for exponential improvement in the financial and operations organizations. Likewise, Finance can support Human Resources to elevate talent management, which has enabled many organizations to be more cost-effective and productive in maximizing the value of labor costs. Part of this activity relates to compensation and incentive systems for the entire workforce and specific areas of sales or contact centers.

Finance has a golden opportunity to drive business excellence in what is now possible through technology to optimize all sorts of processes for profitable results.

Let me know your thoughts or come and collaborate with us on LinkedIn and Facebook.

Regards,

Mark Smith – CEO & EVP Research

Seek Innovation and Optimization in 2010 at the Intersection of Business and Technology

2/5/2010 10:04:53 AM

I want to elaborate further on my recent dialogue on business and technology, and what organizations and especially IT need to consider focusing on in 2010 to innovate and operate more effectively (See: “A New Decade and Technology Charter for Business and IT Starts in 2010”). I outlined the opportunity to invest and be optimistic on what technology and information can do across your processes and talented people in the organization. I want to elaborate further on the dynamics and areas that will be a priority for those organizations who are progressive and believe they can change for the better in adopting technology that goes beyond conventional wisdom but truly shorten existing cycle times in business and increase value to those who are in need to do so.

The battle for being more progressive with technology is common place but the challenges in IT are deeply rooted in history and decades old budget processes and allocations of it. Many organizations have become comfortable in this position of having IT fight for technology budget to them get a similar percentage contributing to technology for optimizing and improving and even smaller percentage for those looking to innovate business. This is no surprise for IT but still shocking for those in business who believe their priority is most important but do not know how difficult it is to get funding through traditional IT budgeting and portfolio management. But as I have seen over recent year’s business is finding their way to increase their access and control of budgets as they look for methods to achieve the level of results mandated upon them.

I want to provide a quick summary of those business areas that are in most need of focus and what they must do for gaining the improvement necessary through using technology that can provide the information and capabilities required. These areas include smart and effective finance, the customer management agenda, operations across workforce and supply chain of products and services, sales and marketing operations and management, optimized IT and focus on information technology and using innovative and disruptive technology. These areas should be a top priority as they will have the largest contribution to business and organizational improvement. There have been an abundance of industry based solutions and associated marketing from technology vendors that might look good but should be closely examined to ensure you are not just adopting a generalized approach or just addressing only one specific area of an organization within an industry focus.

Each of the executive viewpoints I have written will overview our position of importance and priority by Ventana Research and will be followed up by a detailed perspective from others at Ventana Research. These will provide deeper insight and provide reference to the fact-based research and education that drives our firm to provide the greatest value to the industry.

Smart and Effective Finance
The Customer Management Agenda
Operations across Workforce and Supply Chain of Products and Services
Sales and Marketing Operations and Management
Optimized IT and Focus on information technology and
Using Innovative and Disruptive Technology

finally announced is the sales of Initiate Systems to IBM that should close in coming months after regulatory approval. Initiate was a master data management (MDM) technology solution provider with their products called Initiate Master Data Service, data discovery technology with Initiate Inspector. They also have modules like address standardization and supporting third party interfaces to Pitney Bowes Business Insight and data quality capabilities with connectors to third party technology like Trillium. Initiate also had leveraged their SDK efforts into SOA architecture to make it simpler to interface to other technologies easily. Initiate had accumulated almost 200 customers across industries but a concentration within healthcare and government industries since 1995.

IBM already has indicated their focus on using Initiate as a lever into healthcare and government industries and clearly will need to rationalize their technology portfolio as it has significant overlap to the IBM InfoSphere MDM server technology and IBM InfoSphere QualityStage. Initiate Systems had recently release their version 9 product that brought their advancements with the Enterprise SOA Toolkit, document sharing through their enterprise master person index capabilities and Accuracy Workbook to have better metrics on the quality of data. IBM is quite envious of the progress Initiate made through the alignment of their technology into industry solutions. Initiate MDM approach in these industries was through a registry and rules based approach had distinguished their approach compared to IBM MDM approach. In addition this acquisition provides IBM Global Services more technology to help implement and deploy into business processes and vertical industry efforts.

Initiate Systems has learned a lot about the necessary aspects in managing healthcare records and patient specific information. This is more than managing master data but the level of interactions of individuals and locations across systems that must be uniform and ensure its quality and privacy in a patient record using Initiate Patient that leverages the portfolio of horizontal products including the core Initiate Master Data Service. Their focus also includes a similar approach with healthcare provider with their technology called Initiate Provider. They have also has jumped on the government bandwagon with their alignment to the American Recovery and Reinvestment Act (ARRA) by using their technology to further advance the electronic health records and health information exchange (HIE) through Initiate Provider Management. This focus had provided Initiate Systems well over half of their business focus from delivery networks, payers, providers to these exchanges.

But Initiate also made significant progress to helping governmental efforts through managing entity level data to help coordinate across agencies from citizen to criminal level data. Initiate Entity Resolution helps address these challenges of rationalizing data to understand issues. This provided Initiate unique position with customers at state and provincial level to government level like Department of Veterans Affairs.

IBM had advanced their MDM capabilities through specific acquisitions that were layered on top of their data integration called IBM InfoSphere DataStage and data quality technology called InfoSphere QualityStage as part of the unified information technology called

A New Decade and Technology Charter for Business and IT Starts in 2010

2/1/2010 10:44:01 PM

The year is underway and the optimism on using technology for business has a new decade mentality and reality to it. Everyone seems to have settled down with New Year’s predictions that are either crazy or ridiculous as I have already written as they actually might ruin your business. I believe that now is the best time to invest into the major business areas of organizations where technology can address issues and opportunity to optimize and manage more effectively than current efforts as they are more than a priority but a core belief. Much was learned in the last decade across a range of technology that plays a critical role within business processes but also the management of people and processes for advancing the utilization of assets in the most efficient manner. I saw this transformation in the first decade as our firm benchmarked over 10,000 organizations use of information and technology for their people and processes. Much was learned in what it takes to balance improvement across people, processes, information and technology competencies to mature an organization overall. But a lot of the technology discussion in the industry and within IT are just for technology sakes and not focused for truly better, faster and smarter business. This lack of concerted effort to what I identify as business and information technology can accelerate business to reach positive outcomes is exactly what is needed. Building on top of 2009 where the business technology priorities provided a foundation for those organizations who were preparing for decade of technology innovation and competency.

This required level of innovation requires designated focus to the core of every organization across finance, customer, operations including supply chain, sales and marketing, and IT where the use of technology is required to be efficient and effective. The span of technology must focus on applications that are designed for the specific but common business needs to the unique elements of managing assets, portfolio, profitability, and even spend. Similarly there are tools that are designed for roles across the organization as well within IT to use information effectively in business. The CIO and IT must establish more efficient methods to meet the hungrier needs of business for technology or they will continue to divert their cooperation using capital and operational expense budgets at their discretion. The need for business specific applications are expanding in scope and the resulting adoption and evaluation from performance management to sustainability management into the specific needs of the GRC acronym including governance, risk and compliance across finance, operations and IT organizational areas are growing. And while a decade of performance management applications for managing to the corporate and finance objectives have and will continue to make progress I have seen similar specialization along business areas of sales and supply chain. At the same I have seen similar advancements in the contact center and customer management areas as they are growing within IT themselves seeing the importance of managing to specific goals and objectives in a more transparent and direct manner. This has established in innovative organizations more dynamic performance management processes that require dedicated applications to govern and encourage the best outcomes.

Similarly the broader organizational management of the workforce has been climbing in importance as organizations invest into use of talent management applications to achieve optimal workforce performance. This is not one application but a series of applications that work together for the recruitment and on-boarding to effective job positions through compensation, learning, compensation, incenti

Business Intelligence – Less Comedy and More Insight Desperately Needed

2/1/2010 10:41:23 PM

I think we all know by now that business intelligence is important and that organizations should make it easier and more available for everyone in the organization. I would hope that you also at the same time make if faster and have it at a lower cost. I should not forget to tell you that it is available via open source and available online via software as a service. Whether or not you call it pervasive or real time it makes no difference if you do not understand how to provide the context and ability to take action from the information.

If I forgot to mention the importance of using technology and business events or geographic context with BI, well that is only because is something you do not hear this from the conventional wisdom views from most analyst firms today. Your BI technology requires collaboration and the guidance on actions taken with context of goals, objectives and plans to reach desired performance. This is a required set of activities for supporting performance management. To make this happen requires better management of data to ensure that information is of high quality and governed effectively.

Yes and having faster and cheaper data warehouses to support business intelligence throughout the enterprise would be good too. Let’s not forget that you need executive leadership and some best practices to avoid the worst ones. All of this has a high probability of occurring in your organization over the next decade. If you need to know about specific vendors and products, well I would recommend placing Dippin’ Dots on a piece of paper to help figure out which vendors are better for you. OK, I am joking, but Dippin’ Dots are really good.

If none of this makes any sense to you, well, then reading more useful insights on BI technologies like ones I listed below can provide you a deeper technology perspective and where the vendors can help your business intelligence initiatives. When you are done reading and want a grounded perspective with real advice and insight, well read my letter to you and see what you need to do next to be successful.

Actuate Brings Innovation to Performance Management
BI SaaS Vendors Struggle to Survive and Some Do Not
Does Your Operational BI Integrate Predictive Analytics?
Host Analytics Take Corporate Focused Performance Management to the Next Level
IBM Fuses New Generation of Analytics for Deeper Business Optimization
Infor: Future of Technology In Their Products
Informatica Brings Business and IT Together for Your Data in Version 9
Information Builders Rocks Nashville with Business Intelligence and More
Microsoft PerformancePoint – Eliminated and Integrated
Siperian after just publishing their great financial results for 2009. Siperian who had started their business focusing on customer data integration and grew into what is now called multi-domain MDM. Siperian had grown over last several years with a range of brand name organizations that operate globally who have been addressing multi-domain data consistency issues across many industries. Now with Siperian the use of their MDM hub and proven methods for defining, managing and publishing master data will be simpler for organizations using Informatica. As well Informatica has continued to grow organically and through acquisition has been servicing the master data management market through the use of their data integration, identity resolution, data quality and other technologies as outlined on their site under MDM.

Informatica will integrate Siperian into their data quality business which will bring it tightly into their systems. In fact Siperian was already using Informatica technology in their solution and were using their Identity Resolution and Address Doctor that Informatica had acquired. Now Informatica can advance the use of MDM within many areas of their business from data governance, cloud computing and business to business processes. In fact our benchmark research into data governance found that only 12 percent of organizations are innovative and tackled data governance effectively with MDM leaving a significant opportunity for Informatica. In fact MDM was one of the top three technologies for making data governance successful as it was in our recent product information management benchmark research and there is a big demand for eliminating incompatible tools for this critical process.

Siperian had basically two products: the first which was their multi-domain MDM hub that was rules-based and managed data to detailed attributes and lineage of data that can be audited and tracked. The second was Siperian Business Data Director which was designed to support data governance process and provide methods for searching, viewing and creating master data across the business. In fact many of these capabilities were validated and outlined in our research on the needed capabilities for MDM across the enterprise going back over the last five years. Siperian had done a nice job in what the call a trust framework for ensuring data lineage and tracking of data in a consistent manner. Just as important is that Siperian had been effective in managing master data across application domains like Oracle and SAP along with across data domains across data warehouses. All of this is value add for Informatica who also was very integral to the data fabric of an enterprise.

This acquisition is a great step forward for Informatica and builds on top of the recent release of their Version 9 that I recently analyzed (See: “Informatica Brings Business and IT Together for Your Data in Version 9”). Now with MDM in their portfolio, Informatica can safely advance th

HP Gets an F for Customer Experience

1/29/2010 12:47:16 PM

My wife made the mistake of buying an HP laptop. This was less than a year ago. She bought it online direct from HP, and paid handsomely for a 3-year warranty covering any and all issues. The power socket recently malfunctioned, making it impossible to recharge. She contacted HP, asking for instructions on how to arrange for service.

After a week of run-around the issue shows encouraging signs that it will be resolved. Under other circumstances one might think HP was trying to duck responsibility for fixing the unit, but the truth is really much worse. I’ll note that from the start I advised against buying a computer from HP because I know its focus is on corporate accounts. Consumers and small business are going to be the chumps who get customer service that would make the old Aeroflot [Soviet airline] blush.

She repeatedly spent half-hour stretches on hold, then was transferred to other lines and then disconnected. She succeeded in escalating her case on a couple of occasions and was told that someone would contact her in no more than an hour or so with the power to resolve the issue. A day later, e-mails arrived stating that nothing could be done until she provided a long laundry list of information and faxed or scanned purchase documentation. For an item that had been purchased from the company’s own on-line store!

At the heart of the issue is poor integration of their customer record systems (at least that what it looks like at this end). Having looked at enough of these I understand – but cannot have sympathy for – the difficulty of maintaining systems that make things look seamless to customers. (My colleagues have commented on this issue in past blogs on the information applications and contact centers, for example.) Other vendors that sell to both consumers and business, such as Apple and Dell, manage to do a better job.

Here’s an analogy: Investment banks face similar issues involving system fragmentation but work in far more compressed time frames and far larger volumes than what HP’s customer service operations are up against. These banks, which deal with professionals, understand that they must invest the time, effort and money to overcome their IT system challenges or they will not be competitive. In contrast, some large retail banking operations are just sloppy as HP. I pulled an account out of Bank of America when it repeatedly failed to provide me with monthly statements that included all of the assets of the account. Hard to believe? Not when you consider the tangled set of customer systems that have come out of the bank’s long list of mergers over the past decade. But that shouldn’t be (and no longer is) my problem. Combine these systems with poorly trained staff and you have a customer service condition I like to call “spaghetti and meatballs.” That’s what we got from HP.

Grooming, maintenance and integration are the least fun jobs in information technology systems management. I can only assume that in some organizations, they are so used to the mess they deal with every day that they are inured to the issue. Unfortunately, this blinds IT departments to the caustic fallout that comes from not taking this problem seriously enough. Whether it’s external customers or internal users, the poor service has negative consequences on the entire organization. There are plenty of corporations that get this and address the focus of Customer Experience Management that we have benchmarked in our firms research. They make the ongoing investments to

MicroStrategy Brings Future Vision and Reality of Business Intelligence to Customers

1/29/2010 12:28:51 PM

At MicroStrategy World 2010, I had a chance to personally experience MicroStrategy at their annual conference in Las Vegas and examine technologies, collaborate with customers and review their progress in the market with employees. The conference was a very busy event with long lines and not even standing room or seats from the keynote to sessions which is a great sign for the health of MicroStrategy. They knew a storm of customers was coming as they announced it and was clear at the growth of the event which I have attended over the years. It was good they were broadcasting the keynote on the Internet which believe it or not some of the largest software vendors still do not do yet for some reason. I described this on my status on Facebook and LinkedIn as the conference for BI diehards as the technology talk and competency of customers is always more than stimulating. Of course my two days were more than busy with great new nuggets of insight from examining the product and collaborating with clients and customers. Of course, that means this analysis is longer than usual too. So if you are not really into BI, be warned the following details are for those that really love business intelligence!

At this year’s event, Michael Saylor the CEO of MicroStrategy took the stage on the opening keynote slot and focused on the advent of consumer and business technology adoption of mobile technologies like smart phones from RIM BlackBerry and Apple iPhone. Michael outlines his vision of ‘Mobile Intelligence’ that I would agree will be a seismic shift to how business is conducted. Just look at the launch of Apple iPad that simplifies computing again with an interactive and simple tablet computer and I was surprised to see MicroStrategy already operating on the Amazon Kindle. There was an emphasis on the Apple iPhone from Michael Saylor’s keynote that became clearer as Mark LaRow the SVP of Marketing keynote demonstrated a prototype of a native Apple iPhone application that provides access to MicroStrategy platform. It is not clear when this prototype will be available in 2010 or beyond, but the demonstration was important as MicroStrategy has for a long time bet their focus on RIM BlackBerry who has been under attack by the growing Apple iPhone revolution (See: “Apple iPhone and New 3Gs is a Healthy Dose of Apple for Business“). I was happy to see this expansion as MicroStrategy has for many years been exclusively focus on RIM BlackBerry though much of MicroStrategy can operate on other mobile devices like Apple iPhone, Google Android, Microsoft Windows Mobile through email and web browser access through the web browser and email quite easily.

MicroStrategy at this year’s conference announced an incremental release of Version 9 called Release 2 that introduces dramatic increased levels of performance and scalability for analysis and processing data but also significant advancement in the management and operations of MicroStrategy across the enterprise. These are outlined at a summary level at their Version 9 product information page. These advancements were not just casually discussed but were maniacally presented with emphasis on time and cost savings through measurement to previous versions along with comparison to other vendor’s BI technologies like QlikView and SAP Business Objects.

MicroStrategy outlined their technology advancements and strategy thematically to emphasis the impo

Can Avaya Make Heads or Tails From Nortel Assets?

1/27/2010 4:27:59 PM

Now that Avaya has rescued Nortel from going completely under as part of the completed acquisition of Nortel Enterprise Solution assets including technology, customer and employees, the question turns to “what of the future?”. The biggest group of companies concerned with the outcome are those Nortel customers that fear their products won’t be supported for much longer and should evaluate alternative paths for their technology future.

While much of the comments on the Avaya-Nortel roadmap has focussed on technology, what has impressed me is the reality behind the “protect, extend, growth” statements. What these boil down to is that Nortel customers shouldn’t be overly concerned since Avaya has no plans to announce any “end of life” dates for any products during 2010, which when added to its support policy means that no current products will stop being supported until at least 2017. Given the pace of change in the communications and contact center market, this should give most companies adequate time to plan their upgrade strategies.

On the technology front, the way forward for unified communications and contact center depends heavily on Avaya’s AURA product. This sits at the heart of both strategies and provides functionality such as integration with base telephony and data transmission equipment, communication devices such as telephone handsets, integration with business applications and as such business processes (e.g. customer interaction technology capabilities) and presence, the fundamental component of unified communications (UC) that allows the network and therefore other users to seamlessly know who is logged-on and available to collaborate with. This can simplify the method for customer interactions as I wrote about previously See “Unified Communications: Simpler and Eventually Cheaper Customer Interactions“. These integrations rely heavily on all component parts being SIP-enabled, hence lots of comments on the fact that the roadmap is heavily oriented to SIP. To my mind, this is not such a big issue as my research into the use of technology in contact centers shows companies are beginning to invest in SIP-enabled networks and devices and I expect that trend to continue. The roadmap sees some Nortel products, for example to support video, being integrated into AURA. Given this was only released a few months ago, I will be monitoring developments quite closely.

AURA also sits at the heart of the contact center roadmap, which is targeted to end up with the first release of a new product provisionally called the Next Generation Contact Center, in July this year; something customers and prospects should be aware of because after this date it is clear Avaya will be encouraging everyone to transition to NGCC. This will include a Nortel’s Agile Communication Environment (ACE) product, a new component called Work Assignment Engine, a new agent desktop and a new reporting and analytics product called Avaya Performance Suite. There is a lot of talk about what each of these will include but one thing is clear: there needs to be a lot of rationalisation, integration of existing Avaya and Nortel software products. Previous mega-acquisitions by the likes of Oracle, IBM and SAP teach us that rationalising/integrating software products is no easy task, so

Symmetrics Makes Contact Center Performance Management Easier.

1/25/2010 5:57:08 PM

Symmetrics is one of a small group of independent, specialist Contact Center analytics vendors that includes Enkata, Envision, Inova and HardMetrics. Outside of this small group, after several acquisitions, companies either have to use their broader BI technologies such as Cognos (part of IBM) or Business Objects (part of SAP), or go to one of the contact center suite vendors such as Aspect, Cisco, Genesys, NICE Systems, or Verint. One of the specializations of Symmetrics used to be their focus on customers with Nortel telephony equipment, where it had overcome the issue of extracting data for Nortel equipment and making it available for reporting and analysis. I say used to be because over the last few years, it has extended this focus to include Cisco, companies with Avaya telephony equipment and a few specialist workforce management applications such as IEX which is part of NICE Systems. This ability to extract data from a wider set of systems means that Symmetrics is now able to offer more cross-functional analysis, which is vital when it comes to operating a contact center.

Symmetrics has taken a rather unique approach to achieving this wider capability. In essence it achieves this by not integrating with the base system or application but by integrating with the fixed format data that these systems produce e.g. a flat file of call records, or an extracted spreadsheet. These data sources are rather easier to deal with and allow it to take this data and enter it into the Symmetrics datamart technology. This is then available for customers to either use their existing system to analyze or companies can choose the standard functionality provided by Symmetrics. This approach is core to its latest announcement, which is nVision On Demand a software-as-a-service or cloud-based version of the product.

This is very similar to the on-premise version but works in different way. Basically all that companies that subscribe to this option need to do is to send their version of these output files to Symmetrics. Using a point and click tool, it can quickly map these to its datamart, including where necessary any customer-specific amendments made to the files, and thus load the data into a datamart. The service then lets customers either use standard reporting and analysis templates to gain their information or Symmetrics also has a natural-language style web-based tool that allows customers to build their own report templates. This tool is not that sophisticated but it does allow business-users to very quickly get access to the information they need.

My research into the use of technology in contact center environment exposed that only a minority of companies can produce the analysis of their center performance that is vital to running an efficient operation, and the main reason they cited was the difficulty accessing the data. Especially for Avaya, Nortel and Cisco customers, Symmetrics has overcome this issue and represents a low cost way, especially with the new on-demand version, for companies to get this vital information. It is therefore one of the options I recommend companies looking to improve the performance of their contact center evaluate to ensure you are maturing as I already pointed out recently (See: “Are Contact Centers Maturing or Not?”).

Information Applications: New Generation of Information Technologies “). One vendor that has been working heavily to meeting this need is called Mark Logic who has grown rapidly over recent years with now over 200 customers advancing their sophistication in making information readily available in business specific applications.

So what does Mark Logic do? They provide information infrastructure with a platform and toolset called MarkLogic Server using XML as a foundation to access, store, index, search, analyze and assemble content and text into specific applications. Inside of Mark Logic is a sophisticated implementation of a XML based database and server with connectors, security and a portfolio of application services for assembly, library access and search into content easily for the needs of specific applications. This content is the container for embedding text and other forms of data that is part of any organizations documentation, books, reports, policies and procedures and business information that should be easily found through search and navigation. This is also the reference point for where structured data is called into content where needed and does not have to require someone to go and find it in traditional business intelligence type tools that make information disparate and not unified. There is much more to the capabilities for those looking to get really technically deep as I have found in interacting with the Mark Logic team.

For many applications, Mark Logic provides a very sophisticated search interface to specific text within a broad range of content for reducing the time to needed information. Most useful is that Mark Logic has embraced geographic markup languages to also make searching on the proximity and area easily accomplished. This expanded approach to what I call Location Intelligence is quite useful for presenting information location and context of information within content. As well, Mark Logic realizes the importance of mobility and need to search and provide alerts on information as part of their assembled applications. All of this provides the means to have very robust information applications based on the requirements of the users or consumers.

While Mark Logic has been aggressively growing in the government, education and digital media industries where they have been dominating the attention of the industry, they have went well beyond this into the travel, software and financial services industries. This has clearly made an impact that has even got the likes of Oracle who has even put out a competitive paper against them that they are publicly promoting while Mark Logic responded in kind with their Stick to the Facts information that repudiates all the Oracle claims. Much of the Oracle claims appear to be making scattered shots at older version of their

The Sun is Shining on the Adaptive Planning Cloud

1/21/2010 5:26:08 PM

I recently wrote about the accelerating adoption of SaaS solutions by finance departments. In it I noted that while this is not “new news” to those that have been following the IT industry closely, it is to the people who actually are in charge of buying them. Those that once had a kneejerk aversion to using anything but on-premises software (because of their issues with security, functionality and data integration) are increasingly less concerned.

I was reminded of this when I read a recent press release by Adaptive Planning announcing its 2009 results. In a lackluster year for many enterprise software vendors (SAP’s revenues were down, Oracle’s were up only slightly and even Salesforce.com’s revenues slowed to about a 20% increase compared to a 44% gain in 2008) the company announced that it had achieved a 70% gain in revenues and that at year-end it had 660 clients, up 49% from 2008’s final count.

This was a good year for selling planning software. After at least two years of business turmoil and finding their annual budgets were DOA after months of effort, many CFOs and controllers came to recognize that their process was broken. Since spreadsheets are a root cause of serious process issues, especially in planning and budgeting, replacing them with a dedicated application is an important first step to achieving process improvement. For many midsize companies (and even some larger ones) the cost and hassle of deploying on-premises software for this purpose is too high. Caught between the proverbial “rock and a hard place” these companies increasingly are finding that SaaS is the right approach to acquiring a dedicated budgeting solution because of its lower up-front costs, faster time to value and the fact that the company does not have to support or maintain any software or hardware – an important consideration in midsize companies with limited IT staffs.

Adaptive Planning has been steadily adding to the capabilities of its offering. One of the ones with interesting long-term potential is its benchmarking service that gives users access to backward- and forward-looking comparative metrics. In any sort of hosted application environment, it is possible for the vendor to offer anonymous summarized data from all those using the service that approve of its use. In theory, this would let executives of Company X compare their company’s revenue growth assumptions to all other companies in a similar business and/or geography. Or compare gross margins or benefit cost per employee in the most recent quarter. Providing there are enough customers willing to anonymously share their data and that the data can be sliced to the appropriate demographic slice relevant to the company using the data, I believe this sort of benchmarking would be of great value to managers and be one more reason why, compared to using desktop spreadsheets, SaaS is a far superior approach for planning and budgeting.

Let me know your thoughts or come and collaborate with us on LinkedIn and

SAP Shows How to Explain the IFRS Switch

1/21/2010 9:45:23 AM

It may be quite a few years before US companies need to make the switch to adopt International Financial Reporting Standards (IFRS) to replace US Generally Accepted Accounting Principles (GAAP). Much progress has been made in moving the US to the international standard but some significant hurdles remain, including vastly different approaches to revenue recognition. When the switch to IFRS takes place, US companies will face a transition phase where they will have to show their results using both US-GAAP and IFRS. If they’re smart, they will carefully explain to investors their new accounting policies and where the use of IFRS will result in ongoing meaningful differences. All this in quantitative terms so that investors can assess the specific impacts and compare these across similar companies.

I think SAP has provided public companies with a great example of how to provide this kind of information to investors. After a longer-than-required four-year transition period, the company will only report results according to IFRS starting this year. The company has posted a FAQ page on its web site as well as a comprehensive “Virtual Classroom Session” presented by the Chief Accounting Officer, Dr. Chrisoph Hütten that covers more of the details. I think anyone with a basic knowledge of accounting will be able to fully and quickly understand the impact of the change.

For investors in many companies, the transition from US-GAAP to IFRS will not be a big deal because the inherent differences in results reported under the two systems will be immaterial. For others, though, the differences need to be explained carefully. If companies fail to present the impact of the change clearly, or if they only present the bare minimum information required, they may find they are unnecessarily creating suspicious analysts and former investors who are afraid they may be victims of that old accounting game, “hide the ball”.

Let me know your thoughts or come and collaborate with us on LinkedIn and Facebook.

Regards,

Robert D. Kugel - SVP Research

IBM Lotus – Are They Ready for Your Business Collaboration Needs?

1/20/2010 4:41:24 AM

The annual IBM Lotus event called Lotusphere is in full swing this week in Orlando, Florida where it has been held since the 90’s and even when I first visited the event in 1994 and 1995 before IBM acquired Lotus and has been a place for deep discussion on collaboration and role for business. The event brings together the loyal customers of IBM Lotus that have long followed and used Lotus Notes but also now the expanding portfolio of products covering web-based services, social software, widgets/mash-ups, phones/conferencing, email/calendar, mobility and portals. IBM Lotus came out with a group of technology announcements this week covering: cloud computing business collaboration solution called LotusLive; technology advancement of Lotus Connections operating on RIM BlackBerry; R&D efforts called IBM Vulcan to demonstrate technology that might appear in future versions of products; and IBM collaboration agenda to help organizations understand their efforts.

I did not make it down to the conference but did spend many hours reviewing the new education available on www.lotusknows.com and assessment on their advancements compared to others in the industry. It was more than disappointing to see that IBM could not use commonly available technology for Internet broadcasting of their conference keynotes or sessions like Infor, Microsoft, Oracle, salesforce.com, SAP and others that do already. Looking at PDF of presentations afterwards never is the same experience. Of course it would have been good to use their technology to make the point sharing presentations and collaboration on the Internet is as simple as using IBM Lotus. But this was not the case and does not speak to being progressive in using their technology for an annual conference. But let’s move off the lack of collaboration and marketing of IBM Lotus and get back to the announcements and industry.

Let’s do a deep dive and let me discuss the current business and market environment and impact to IBM efforts in collaboration. The major driving areas advancing the need for business to improve their collaboration efforts are now being support by the following factors. First, the advancement of collaboration in business is accelerating at a feverous pace as organizations realize the productivity improvement and workforce engagement value of this technology for business as I have pointed out in business technology priority for 2009 and will be for 2010 The advancement of collaboration on the Internet with Facebook and LinkedIn has set certain level of expectations for employees in the workforce on what is required to be as efficient as you can be with business and personal friends collaborating on the Internet. Second, the need for instant communications to people no matter where they are located needs to be simple and interactive. Third, the demand for bringing information together and provide to people in business has risen to a new level where new classes of applications that I call Information Applications, which IBM has a product called IBM Mashup Center that is focused on simplifying integration of information and services for collaboration that I have already examined (See: “IBM Mashes Information and Analytics to

New Year Technology Predictions Could Ruin Your Business

1/18/2010 1:33:09 PM

Every year we see the same cycle of predictions on the use and future of technology in the industry. In many areas the predictions are absent of relevance to one industry or another, let alone impact to certain sized organizations. I have to chuckle to read the array of them from conventional wisdom ones like balancing supply and demand to organizations through efficient use of S&OP and organizations are moving from reporting to intelligence. Even one that predicts IT will shift twenty percent of their technology use in the enterprise to cloud computing in 2010 is stretching it a bit though an interesting technology strategy. Worse yet is they are not based on a solid base of methodical research across business and IT or evaluating the technology they are predicting. All of these are equivalently the same in that they are either generic or not tangible enough on what you need to do. Specifics are important to know how advancing from where you are at with information and technology in your processes and the people who operate them.

I am not trying to be the Grinch but let’s be real we need to take a closer look to what we need as individuals and teams that operate within a role and responsibility in organizations. Assessing your current environment and what is possible with technology for business needs will help develop a map of advancement to achieve at the start of this decade. I am personally very bullish on the potential of technology this year but do believe that we need to get more pragmatic on predictions of technology and focus on what we need to do for improving in iterative time cycles like month to month. The days of multi-year technology projects are over and it is imperative to add value every month and quarter that develop our competencies to the next level. As a reader of looking for those nuggets of insight you might want to skip over rhetoric and look for more fact based advice that can help your organization.

In the coming weeks Ventana Research will roll out recommendations for what your organization can do to maximize the use of enterprise software and technology across business areas like finance, operations, customer, sales & marketing along with IT. These will help you better optimize your strategies and plans along with saving you money and time to ensure you get to the next level of leadership as we found in our 2009 Ventana Research Leadership Awards. I would make sure to look at what other organizations have accomplished, what can help you innovate and optimize use of technology for business to be smarter and faster than others which is why our firm launched a new service called Ventana OnDemand to provide timely and bite-sized advice and education to make effective and informed decisions. If you depend on technology predictions from IT analysts or others you might find yourself increasing your risk of failure or recommending something that your organization is not ready to accomplish. Unless they are based on methodical research and experience across hundreds or thousands of companies that have been measured, the predictions are interesting opinions.
Let’s all hope for a successful 2010 and work collaboratively to advance business efficiently in their use of technology that can improve processes and resulting performance.

Let me know your thoughts or come and collaborate with us on LinkedIn and Oracle acquired Silver Creek Systems. Oracle was already in a technology partnership with Silver Creek to help with Oracle product data management needs as I already assessed (See: “Oracle Taps Silver Creek for Improving Product Data”) And now is part of a larger strategy to expand the footprint of data integration capabilities. Silver Creek is part of what I have commonly called data discovery where information technology helps interrogate and provide recommended matching of data. This set of capabilities is used quite often to help improve data quality or help streamline processes for master data management. Silver Creek had excelled at applying this capability to product data across disparate systems.

This acquisition is not unexpected as Silver Creek Systems had worked for many years to advance their market recognized position and customer deployments as part of a larger toolset required for organizations information management efforts. Silver Creek Systems had a set of products called Governance Studio for data stewards to DataLens for establishing rules and workflow across data to managing the discovery and integration of data. Much of Silver Creek secret sauce is based on the semantic-based recognition technology that dynamically recommends matches of related data from disparate systems. They provide an auto-learning process that helps support data governance processes to ensure incremental matching and alignment of existing and new data elements.

I am quite familiar with Silver Creek from assessing them since their inception and these types of needs in organization’s data governance processes. Our benchmark research on the topic identified data governance challenges that start with understanding data issues which were a priority in 57 percent of organizations. As well our recent benchmark research into product information management found that data discovery was one of the top five technology priorities and improving data quality was the top business issue found in 56 percent of organizations who are driving change in how product data is managed.

Silver Creek addressed many of the needs for data governance and product information management which made it quite attractive for Oracle to acquire. IBM had already acquired Exeros in 2009 (See: "IBM Scores Data Discovery Technology for Information Agenda”) to advance their data discovery efforts, while other independents like Sypherlink are independently operating as is Netrics who has recently licensed their technology to vendors like Kalido and Tibco while Informatica has their own approach called Data Explorer. All this industry activity validates an automated approach to discovering and matching data as part organizations information management processes. Oracle is taking the right step forward with acquiring this silver in ‘Silver Creek’ they will need to further integrate technology into the suite of acquired technologies that are part of a new information management toolset from Oracle. Organizations should have some level of comfort that these two organizations had been interacting with each other in 2009 through a technology partnership that will help accelerate the complete integration of products in 2010.

Let me know your thoughts or come and col

Quantrix Gets Pushy with Plans

1/15/2010 5:31:23 AM

As a former full-time spreadsheet jockey, I am painfully aware the strengths and weaknesses of this 30-year old technology (which I have been using for 30 years). I think people continue to use spreadsheets inappropriately because they think that the ease with which they set up a model, report or business process more than compensates for the headaches of using the thing. Or, they’re just so used to spreadsheet problems as we found in our spreadsheet research that they shrug it off rather than trying to find a solution. Once upon a time there were few if any practical alternatives but today alternatives abound. Finding cost-effective solutions to replace desktop spreadsheets has been a focus of my research.

Quantrix provides a product called Modeler is one such cost-effective alternative to desktop spreadsheets. Although it requires some training and practice to become proficient, it eliminates most or all (depending on how it’s used) of the ongoing hassles that organizations face when they use desktop spreadsheets in repetitive collaborative business processes. One area where this is particularly important is in planning and budgeting – an area where I think Quantrix has excelled from the start. The company recently added an integration tool, DataPush to enable companies to (as the name implies) automatically push data from Quantrix models to databases or business applications. This push feature is especially useful when companies want to do integrated business planning.

Our benchmark research on this topic of integrated business planning shows that corporations engage in multiple, parallel planning activities: there are sales plans, demand plans, transportation plans, marketing plans, maintenance and repair plans and so on. Rarely, however, do companies formally integrate the results of these plans. The closest thing to an integrated plan is the annual budget and the periodic updates. However, there are at least two important issues that prevent spreadsheet-based budgets from being a useful integrated business plans. First, since budgets are mainly concerned with money, much of the non-financial operating detail is omitted – limiting the budget’s usefulness in supporting non-financial planning. Quantrix Modeler enables companies to keep track of “things” (headcount by grade, units of bar stock, minutes of machine time, consulting hours and so on) as they construct their models and share this data. Second, because of the difficulty of rolling up and consolidating data from multiple sources in desktop spreadsheets, the connection is indirect and not necessarily synchronized. DataPush addresses this. When changes occur that require an update, DataPush will send out updates of specific pieces of a plan out to every other planning unit (such as a department, division, business unit, etc.). Formally linking the models ensures that accurate, synchronized and up-to-date information is used by all parts of the business. The data also can be pushed into ERP systems, databases or other information sources that can use this data to prepare reports or drive other analyses.

Quantrix also provides DataNav that helps provide query, analysis and visualization capabilities to compliment Modeler that I already assessed (See: “Quantrix Advances Modeling and Analyti

Quality of Agents Maximized with Nexidia Speech Analytics

1/12/2010 9:30:21 PM

Nexidia is recognised as one of the leading independent vendors of a speech analytics product called Enterprise Speech Intelligence. The foundation of its product is the use of phonetics-based analysis to index the content of recorded calls and then define rules that essentially allow users to aggregate calls into different buckets which relate to specific business initiatives. The product includes extensive analysis and presentation options to analyse the data and provide users with an extensive array of information in some highly innovative formats. The core product also includes root cause analysis, workflow and alerts that help ensure that action is taken to address the issues causing the identified outcomes, thus closing the loop and making the product a true performance management application.

However Nexidia’s strategy is to make life even easier for users by developing pre-packaged offerings that focus on specific business initiatives. During 2009 it released packages that are focussed on improving first call resolution rates, an out-of-the-box speech analytics starter pack, and integration directly to telephone switching equipment as I wrote about previously (See: “Nexidia Launches First Real-time Speech Analytics“). The latest package ESI-Quality focuses on agent performance. This uses exactly the same phonetics-based analysis to identify calls that match pre-define quality criteria and these can be bundled together using a combination of the already define business criteria/initiatives. Additional rules allow users to create performance metrics that define above and below performance. Reports then show which initiatives are beating targets and which are not. These reports can be structured to mirror the organisational structure of a company’s contact center and so allow user to see summary reports at the top level and then drill down by different centers, different teams and eventually to individual agents. There are links to a rudimentary agent quality monitporing system that helps create agent quality performance forms and to identify specific training or coaching requirements. Alternatively the product includes integration to third party systems such as Knowlagent and Merced Systems (See: “Merced Systems and Nexidia Partner for Agent Performance Management“).

My recent benchmark research into agent performance management showed that the traditional agent quality management process and system still prevail in the majority of companies. These typically involve manually listening to a very small number of recorded calls, filling in a form and then leaving it largely to chance if follow-up action is taken. This latest package from Nexidia means that companies can base agent performance assessment on a 100% of calls, pre-defined rules make the assessment much more objective and the closed-loop processes supported by the application make sure appropriate action is taken. Companies that want to improve agent performance and as a consequence improve customer service would do well to take a look at what Nexidia ESI now supports.

Let me know your thoughts or come and collaborate with me on I have spent 15-20 years as a consultant building contact centers and now as a research analyst covering all business technology aspects of handling multi-channel customer interactions. Up until now my experience and research tells me building a modern day center hasn’t changed a great deal and requires purchasing several different types of hardware and software applications, and then integrating them. Over the last few months I have been tracking developments at a technology provider called NewVoiceMedia and after my latest interaction with them I see how the industry has significantly changed.

In the old world building a basic call center required an ACD to manage the telephony, call routing software to route calls to agents or agent groups, CTI software to integrate to the agent desktop, and IVR to collect customer information and thus make call routing smarter, call recording software for regulatory purposes and to analyse agent performance, an agent quality monitoring system, a workforce management system to manage agent work schedules, training and coaching, a performance management system and analytics to report and manage contact center performance, and a CRM application to record what customers called, why they called and what was done about it. That is not easy to integrate or manage. Typically these systems had to be purchased from different technology vendors, although over the last few years vendors such as Aspect, Genesys, Nice Systems and Verint have bundled some of the component parts into pre-integrated solutions. The systems were typically purchased as hardware or on premise software applications, although over the last few years vendors such as Cisco and Interactive Intelligence have produced software only solutions. And last but not least, most companies had to employ a systems integrator to put the whole thing together, as integrating the components was a major task and then configuring the whole system to meet operational requirements was yet another major task.

NewVoiceMedia changes all this. It has built a ground up software only system called ContactWorld that includes ACD functionality, call routing, CTI, a very smart IVR system (including a customer surveying application), call recording, an agent desktop application which makes it easy to access other applications without having to re-enter data, a basic CRM system, and analytics. It also has pre-packaged integration with other applications such as salesforce.com that i recently covered (See: “Salesforce Cloudforce – Socializing and Servicing Customers in the Clouds“)and informavores. As well as bundling all this functionality into one solution, the software includes some unique functionality:

Creating agents and managing their profile happens at the click of mouse; literally during a demonstration (over the Internet) I was created as a virtual agent within the demonstration contact center, with calls being routed to my cell phone and with me having access to the full set of functionality allowed by my profile. In a more normal operating environment this means supervisors can set-up new agents in seconds, agents status can be managed remotely and in an instance, and say an agent was snow bound, calls could be re-routed to their home number and they could continue to work as normal.
Bedford Clicks Authoria Up a Notch of Talent with Peopleclick

1/7/2010 5:57:49 PM

Authoria, a provider of Talent Management solutions for human resources and workforces, acquired Peopleclick by the command of their owners Bedford Funding to form Peopleclick Authoria that will be approximately in the range of $100 million in revenue for 2009. Both enterprise software focused technology vendors had been advancing their solutions as part of the cloud computing and software-as-a-service (SaaS) movement. This is an important move for both organizations that needed to reach a certain size of customers and recurring revenue to grow and expand operations globally.

Authoria brought recruiting, performance, compensation, succession and communications and has been working to advance the depth of capabilities and make them more readily available from mobile technologies as pointed out from my analysis at HR Tech (See: “HR Tech Brings New Products but HR Budgets May Limit Potential“). Peopleclick also brings recruitment and onboarding but also complimentary vendor management and specialized capabilities for managing and monitoring large workforces with business intelligence for having insight to pre and post hire activities to ensure workforce compliance and diversity. In fact Peopleclick provided some critical information for large workforces across the world that needed to monitor a range of compliance information requirements. Peopleclick had been build good momentum with 7-11, BestBuy, GlaxoSmithKline, Home Depot, McDonalds, Motorola, Siemens and T-Mobile to name a few of their customers.

This organization will be led by Charles Jones from Bedford Human Capital Management Holding Corporation. Charles is an experienced software veteran from last several decades who knows M&A but also as being the CEO of Geac which is now part of what is known as Infor. Charles is now the Chairman and CEO of Peopleclick Authoria who leads the newly formed organization. I was fortunate enough to have an insightful interview with Charles to get a deeper perspective on the direction and intention of Peopleclick Authoria and where the customers, products and organizations will move forward. It was nice to reconnect with Charles who remembered our in-depth research and assessment of Geac. First the integrated organization will leverage the best of both teams to ensure that the existing customers and products can be managed to their maximum return which means to maintain and improve existing products for some time as both organizations service major global organizations. Next is to rationalize some of the technology and where complimentary synergies can be found that is no easy task as both organizations have different technology foundations to their product lines that will take time to work out.

I had seen little communications from either organization in 2009 and also they were not as actively engaged into new customer opportunities where I thought it made sense to be on short list of evaluations. In addition the steps and secret to being successful is not to spend all the time engaging with human resources who will only provide so much growth and support to suppliers like Peopleclick or Authoria. Only a small percentage of HR organizations have the competency and maturity to drive strategic improvement and transformational talent and workforce process improvements. The finance organization must fund improvements and operations that manage the workforce must embrace it as we have seen and validated in our research. The reduced communication and lack of breadth in addressing the executive and management buyers was a large concern of mine that I addressed to Charles who does understand this critical juncture for their

SaaS Barriers Fall and Clouds Rise to Power

1/7/2010 5:47:14 PM

If you’re in the IT analyst business (either the “industry” or “Wall St.” variety) software-as-a –service (SaaS) as a major or even dominant delivery mechanism is a foregone conclusion by now. In that context, this blog may appear pathetically late. However, if you spend any time talking with folks that don’t make a living out of IT you find that most are just warming up to SaaS as a mainstream choice. They may just be catching up with the digitally aware, but catch up they certainly will over the next several years as the key barriers to SaaS adoption continue to diminish.

I don’t see SaaS displacing on premises deployments in the coming decade. I do believe that the hybrid model will be very common as on-premises vendors structure their offerings to allow companies to add portions of the capabilities in the cloud. This SaaS portion of “the stack” will be especially attractive in cases where those participating in a business process operate outside of the firewall (such as the sales force or field service) or where a portion of the value of the service comes from delivering a volatile external data set (tax rates, product pricing) or where the software does something less than strategic (such as travel and entertainment expense).

There have been three generic barriers to adoption that have held down the market for enterprise SaaS applications: security, functionality and data integration. To be sure, there are several areas where in practice where these barriers have been low or a non-issue (sales force automation or T&E, for example) but in others (ERP, for instance) they remain a sticking point. Several years ago there was a fourth –SaaS is just another fad – but this was certainly demolished when Salesforce.com‘s revenues crossed the US $1-billion mark.

Security concerns dogged the SaaS model from the start, especially where business sensitive data is concerned. Technology improvements and external certification of vendors’ should have addressed these concerns but there continues to be a reluctance to “put our data out there.” However, I think this perspective will be replaced by a growing recognition that a company’s data may be more secure if it’s not on the server down the hall in the closet. A company may back up servers nightly but in the event of a water or fire disaster they won’t be of much use. Relatively inexpensive 32 gigabyte thumb drives have made large-scale data theft a simple reality. And let’s not even talk about disgruntled employees. I’m not sure when the tipping point of the mindset will take place – the point where enough people perceive equal or greater security off premises – but it will happen.

A decade ago, when hosting ERP systems designed for large corporations was initially considered, proponents thought midsize companies would be willing to take a plain vanilla version. This proved to be a delusion then and remains the case today. To be sure, some companies will compromise when it comes to replicating existing business processes in new software, but some capabilities are too critical. Functionality has not been an issue for some types of categories (T&E, for instance) or has diminished considerably as vendors have built out the capabilities of their offering, but (for example) ERP continues to have significant enough limitations for some companies. Nonetheless, over the next five years I expect most of these functionality barriers will evaporate. Limitations of the Web interface has also been an impediment in some cases because of technological limitations and here again, emerging richer Web clients will alleviate this issue. It’s also not too hard to imagine a day when a SaaS-delivered application in practice will

A Last Look At The Naughty and the Nice

1/7/2010 5:48:02 AM

It is the beginning of 2010 and of a new decade. But before we shift our focus completely forward, it’s worth a last look back to consider all that was learned in 2009 by those individuals who took the initiative to drive change and improvement to their organization and industry.

This was not easy to do. It was a year fraught with daily challenges. We all learned a lot from witnessing how many organizations had to stabilize their business processes with fewer resources and investments available for improvement. In that context, I’d like to congratulate those organizations that took the initiative to engage with Ventana Research and those that we evaluated and recognized in our recent Ventana Research Leadership Awards. These latter were organizations like Nationwide and Welch Foods that reaped the benefits of using business technology for a range of financial and operational performance improvements. If all organizations had individuals driving improvement and change like those that were finalists in the awards process, then the performance and value of all of our industries would be significantly higher.

On the technology vendor side, there were many that took the initiative to brief and interact with our firm throughout 2009; a tip of the hat to each of them. Doing this made a large difference by providing us with insights into the value of their approaches, which in turn enabled us to deliver advice and guidance to our clients. These vendor briefings are critical to ensure that we can guide buyers about the proper scope of the suppliers and how to assess the value of investment in them for their business and IT priorities. On the other hand, there were some vendors that lost sight of the basic tenets of marketing and did not bother to take the initiative to brief us, leaving them with one less channel available for educating a broader audience. Unfortunately for them, we do not follow such companies and so have stopped research coverage of them, which eliminates them from our recommendations. Those vendors are listed below for reference and to inform those who may be concerned about the technology suppliers they are evaluating or utilizing.

Unfortunately for them, many in the technology vendor community think that engaging solely with the large IT analyst firms like Gartner and Forrester will magically make their company more successful. I’ve been in this business for a long time and I can assure them that these are unrealistic fantasies. I never worked quite that way, and the landscape of buyer influence has changed dramatically over the last five years. Buyers today can get information from dozens of sources, and now are looking for more bite-size and timely but still trusted answers to their questions about satisfying their needs.

This ongoing change in channels and approach for getting trusted advice and information will lead to a new approach to our services in 2010 as well. But what won’t change is our commitment to researching and evaluating process and technology issues in business as well as IT terms. Serving only IT, as virtually all of the large analyst firms do, and approaching the market with only that perspective will continue to bias the advice offered.

Another factor I think is important for trust is openness. Ventana Research has operated for almost ten years with an open and transparent approach to research coverage and listing. This makes us very different from all the rest of the analyst firms, which keep hidden the lists the vendors they cover in research. This is unfortunate, as it makes it far more challenging to know where to get information about specific vendors and products.

We will continue to promote validated vendors and products and make listings of and information a

Ransys Advances Customer Experience Management Imperative

1/1/2010 9:45:40 PM

When I think of Customer Experience Management, there are three things that come to mind: a smart agent desktop that assists agents as they interact wiath customers; a natural language-driven customer portal that is personalized to individual customers; and customer feed-back management that allows companies to assess how their customers feel about their interactions with a company. My research earlier this year into customer experience management (CEM) showed companies still have some way to go in adopting the technologies that would help them improve in all three areas.

In respect of assessing customer reaction to interactions, the CEM research showed that companies rely heavily on someone listening to recorded customer calls. I believe this is far from satisfactory as my research into the use of technology in contact centers showed that companies mostly only listen to a very small percentage of calls, and even then the focus is mainly on agent quality monitoring. Companies would do much better to adopt best practices and assess customer satisfaction through customer surveys and analysis of the completed surveys. Ransys is one of a few niche vendors that support companies in doing this as part of their AttentiveTM suite of applications and only until recently have been getting credit for their products which is seen in their growth globally.

The Attentive Feedback Management supports all the core functionality you would expect of an enterprise feed-back system: survey design, survey personalization to corporate design requirements, click-of-the button multi-lingual support, repurposing so a single design can be used across multiple communication channels (telephone, portal, e-mail etc.), and reporting and analysis. The surveys can be configured to assess specific business issues such as agent appraisal, 360 customer feed-back, knowledge assessment etc. and who gets surveyed, how and when is driven by a rules-based engine which can be configured right down to an individual customer, agent, or indeed type of interaction level. The product can be configured to automatically attach different types of information to a survey such as call time, handling agent, customer value. Depending on the availability of such information, this might require some integration work but the result is a single point of access to all relevant information for much deeper analysis other than “simple” analysis of responses. For example a supervisor can see all the interactions for their team that have a corresponding completed survey and in the same analysis they can see relevant performance information (surveys for interactions that had a longer than targeted duration). This analysis form can be configured with action check boxes, which if completed automatically raise an alert (typically an e-mail) so that someone takes action based on the information; for example, call the customer back and try to resolve an uncompleted issue.

Combined with a reporting and analytics package, this last set of capabilities extends the Ransys product into what Ventana Research defines as performance management in that it supports the analysis of what has happened, identifies what needs to be done to improve and then enables change to either people (e.g. recommended training), process (e.g. the way interactions are handled), or indeed policy (e.g. how different customer segments are treated). The reporting and analytics is also highly customizable and supports a hierarchy of reports that can start at a high, summary level, and then drill down to individual agents, customers or surveys. It even includes a “lazy user” features whereby the reports and analysis can be automatically load

Starview Advances Operational Intelligence with Analytics in Distributed CEP

1/1/2010 9:39:56 PM

The need for organizations to be responsive is a cliché, but most do not invest the time and money needed to enable them to accomplish this. Decades of technology maturing has led us to be able to process and analyze business events to use them as response triggers – what is referred to as complex event processing (CEP), part of what I call Operational Intelligence. Starview Technology a provider of CEP and related technology for Operational Intelligence, has advanced with innovations in this technology category, which is one that our research firm has benchmarked to help advise organizations on the use of technology for business. I have been espousing the importance of this new generation of business intelligence, Operational Intelligence, for many years; it now is becoming a discussion topic for business and IT focused on competing globally.

I recently got a chance to examine Starview and its technology called Starview Smart Enterprise Platform to see how it is addressing Operational Intelligence with its unique approach to CEP. Starview has been promoting the importance of its distributed technology architecture and how it has used its agent-oriented rules language called StarRules to apply analytics ranging from simple to sophisticated. It’s an approach that truly reflects how many global organizations drive operations using people and processes worldwide, across every major geography and time zone. Organizations need to have local event processing before sending the events into what Starview calls its enterprise hub, where additional processing can be performed. This is critical, as dealing with events from disparate systems has been a challenge in many industries including energy, communications, manufacturing and retail that have a need for distributed processing.

Also important in this area is the ability to run simulations on real-time or historical events to improve their processing for specific business and technical purposes. Starview offers this capability, which can not only ensure the successful processing of events but also identify where to optimize business activities rather than just monitor them. On this topic, earlier this year I pointed out the limitations of business activity monitoring (BAM) (See: “The Dead End for Business Activity Monitoring (BAM)“).

With this product Starview thus has advanced the management of the processing of events across a distributed environment with extensions of its technology for monitoring and processing events via the agents that are closest to the events themselves. It has developed deployment scenarios of its technology for the utility and manufacturing industries. The challenge for Starview is to expand its front-end business user capability while delivering simple access to and notification of relevant information.

This architecture and technology to manage events across different geographies or areas of an organization has great potential. It’s an approach that addresses the growing demand for CEP as part of Operational Intelligence (See: “Operational Intelligence Requires Complex Event Processing (CEP)“), a business technology category that I ex

Is Social Customer Service a – Fantasy or Reality?

1/1/2010 9:15:57 PM

It never ceases to amaze me how the world can suddenly catch on to a new fad and declare that the “world has changed” and everyone needs to get on board or they are doomed to failure. Now there is absolutely no doubt that social media sites are here, and the likes of Facebook, LinkedIn and Twitter have hundreds of millions of people and our research firm posts daily insights to reach a larger community of people. It is also true that not all these users are the “young generation” and that indeed many companies, including Ventana Research, have gone down the route of creating their own social media sites so they can interact with their customers. But I think a large slice of reality is required before everyone declares that using social media is the “be all and end all” of customer service going forward.

For example, I finished a benchmark research project into customer experience management (CEM) and the responses from over 300 companies clearly show the use of these sites is very much in its infancy and no-one is quite sure how customers use these sites, how companies should respond, or indeed how what percentage of interactions are likely to happen through these channels as opposed to the more traditional channels of the phone, e-mail, chat and mobile text messaging. But that said, customers are starting to use these channels and companies need to be cognizant of this and take appropriate actions.

The first obvious activity that customers are doing on social media sites is voicing their complaints in Internet places like Yelp and Twitter, quite often about the poor service they received through other channels. Instead of ignoring these or regarding it as negative, the most innovative companies are harvesting this information and using it to improve their overall customer service processes. Companies do this by capturing the text from these sites and using text analytics to uncover customer issues and the root cause behind these issues. The outcome form this analysis is used to raise alerts or workflow items to ensure someone takes appropriate action, which might well include responding through the same channel.

This process touches on something which has been named “crowdsourcing”. The basic idea is that companies collect information from a large group of customers simply by collecting information being created spontaneously by users of a social media sites (e.g. complaints about a certain product) or by directly soliciting information, for example about an intended product development. The latter is probably only for the most innovative companies but collecting customer complaints and potential solutions from social media sites is a great way for companies to tap into a wider number of their customers. The results can then not only be used to respond to the original complaints, but it can be added as an frequently asked question (FAQ) on the customer portal and to the knowledge based used by the contact center and knowledge workers to answer customer interactions. This technique is also being applied inside the enterprise across a workforce as my colleague recently discussed (See: “Who Knew the Risk? Everyone But You“).

These two relatively simple steps will allow companies to take the first steps to embracing social media. As these channels mature, companies can then expand their usage after seeing how customers respond to these first deployments.

Let me know your thoughts or come and collaborate with me on

IBM Will Find Business Process Optimization with Acquisition of Lombardi Software

12/18/2009 7:30:32 PM

This week IBM signed a definitive agreement to acquire Lombardi Software who is one of the key independent and dedicated providers of business process management systems (BPMS). The unique element of Lombardi was their ability to help organizations gain visibility through their process models that can easily measure activities and business flows across the enterprise. The Lombardi Teamworks 7 is not your typical BPMS that focuses on process automation and execution but actually focuses on the design and management of models that are used for visibility and optimization. This essential element of Lombardi makes it more than just middleware or integration technology but essential business management software that through analytics provides some deeper insight to the actual business processes of your organization.

I have watched Lombardi for well over 7 years as they were one of the vendors I highly regarded in 2002 as having business process intelligence which was the fusion of business process management and business intelligence. Of course this concept was well ahead of its time and not as easy to understand by organizations that were confused on what needs to be done first. Do you automate and change your business processes before assessing they need to be improved in the first place? Well unfortunately most organizations made the mistake or gut-based decision to automate and focus on execution which worked out for some and for others was just an exercise of work. Due to the lack of maturity of competency of most organizations, Lombardi adjusted to the mainstream terminology on describing what they do as business process management systems that has helped them be more accepted by many organizations. At the same time the BPMS industry has been too insulated in their own industry discussions preventing them from getting break through growth like the business intelligence industry did in the last 10 years.

IBM is acquiring a robust platform called Lombardi Teamworks7 that provides the key capabilities of designing and assembling process models and their components that can be re-used across other business processes. As the BPMS software industry has matured over the last five years is that the use of a repository and storage of the sub-components of business process models that can be used to develop a range of process-centric applications. It provides the ability to develop measurements from which metrics and key process indicators can be linked to objectives are the baseline of what they call process visibility. The framework of business process scoreboards are comprised with goals and key process indicators are an essential element of the technology which can be accessed and delivered into the Teamworks Portal and also directly into Microsoft Office. For the sophisticated is that the technology can perform optimization routines and simulations across options business process options to help organizations make pinpointed improvements.

The other key technology and intellectual asset beyond the platform and capabilities is the Lombardi Blueprint that provides a foundation for teams to collaborate and maintain process documentation. This software and best practices based environment provides a centralized environment to discuss and focus and improve business processes. The blueprint environment provides methods to author logical layout of business processes along with the overall secure access to the information. This complimentary component to Teamworks7 is a significantly valuable component that I hope IBM assesses and expands to support other areas l

Why Enterprise Risk Management Is Important

12/17/2009 9:26:50 AM

Software companies started using the adjective “enterprise” a couple of decades ago to connote its ability to scale to the needs of the largest corporations and to span the needs of multiple departments or business units. Skeptics, however, have come to think the word is either meaningless or synonymous with overpriced. I confess that at times I sympathize with this view. However, it strikes me that when it comes to risk management, there are times when “enterprise” is precisely what a company needs. I’ve written on the need for enterprise risk management (ERM) from the standpoint of increasing the degree of automation companies use or using techniques such as prediction markets to improve risk management effectiveness. It’s also important for corporations, especially larger ones, to have compensating controls at its highest levels to mitigate regulatory or legal compliance risk.

Corporations use incentives in an attempt to align the behavior and decisions of executives, managers and individual employees with the organization’s objectives. In the more than half century since Peter Drucker began instilling some discipline into theories of what we now call “performance management,” one of the clearest lessons learned is that managing to a single, simplistic short-term objective means that long-term disaster is not being left to chance. The “balanced” score card came into being because in business almost all decisions involve trade-offs: market share versus profitability, for example. With a single performance measurement, managers are easily tempted to make trade-offs that will benefit them but harm the corporation. Even multiple metrics may produce perverse outcomes if the metrics are unrelated. “Balance” means the incentive system possesses compensating controls – for instance, setting production incentives but balancing these against scrap or defect rate metrics.

Measuring performance-to-production goals against scrap rates is an example where the compensating control exists within the business unit. However, there are plenty of occasions when the control is at a higher level within a company. This is especially true for regulatory or legal compliance. Instructing managers not to break the law or violate regulations may be effective for a large majority of them. Companies take some care in who they hire and promote but experience shows that there are limits to the effectiveness of this approach. Anticipating where legal or regulatory problems may arise and keeping tabs on indicators of problems in this area will reduce the risk of an “unfavorable development.”

Compensating controls have an important role in other aspects of legal or regulatory compliance, especially where the judgment call on one individual may unduly increase the risk to the company at large. For instance, an integrated oil company is interested in maximizing its profits but it (and its board and shareholders) do not want a refinery to blow up, killing employees and nearby residents, especially if the explosion is the result of shoddy maintenance. The vice president of this refinery division has incentives based on production, profitability and safety objectives. Although he or she has incentives not to cut corners and may have impeccable moral character, they may find themselves tempted to postpone some bit of scheduled maintenance for the sake of boosting output and profitability. The reason is that plenty of managers have cut corners in the past and nothing bad has come of it. Indeed, after successfully cutting corners to achieve a short-term goal, a manager may be tempted to push the envelope further the next time.

Which brings me to the point of this blog: enterprise risk management. Corporations need to put into place controls that will alert them to th

VPI Uses Analytics to Optimize Agents and Interactions

12/15/2009 10:29:52 AM

I recently got an end of year update from Voice Print International (VPI) who is one of the leading workforce optimization vendors that in a similar way to Aspect, NICE Systems and Verint provides a suite of products that covers core agent performance management functionality that I recently conducted some in depth benchmark research. VPI suite of products covers similar functionality to the big three – call recording, desktop capture, quality monitoring, training and coaching, and analytics and performance management. The latest version of its product VPI Empower include a number of new enhancements, the most significant of which relate to a greater focus on analytics. The product is able to capture data from almost any data source, including calls, the agent’s desktop usage and data entered into other applications, and produce an analysis of this data. The resulting information can be displayed in various formats, everything from reports, real-time tickers on the agent desktop, performance dashboards, heat maps and alerts.

However the same analysis can be put to greater use. Basically it can be used to drive functionality in other modules like to identify calls that an agent has not handled particularly well, create a targeted evaluation form and session, and if appropriate identify immediate training the agent should undertake. This makes the agent quality monitoring more focused and information-driven, which should lead to improved performance in targeted areas. The analysis can be made available in real-time, allowing supervisors to spot immediate issues and to thus drive just-in-time coaching. The simultaneous capture of agent desktop usage during a call, allows the product to tag calls with what agents did at their desktop, again making it easier to target areas in need of improvement.

My research into customer experience management showed that the most innovative companies recognise just how important the role of the agent is when it comes to creating a good experience, with the top companies recognizing that agent attitude is the number one contributor to customer satisfaction. It is therefore essential for companies to know as quickly as possible how well their agents are handling calls, and for them to take action as soon as possible. The analytics-driven approach supported by VPI allows companies to do this and to focus their efforts where they will achieve the great benefits.

Let me know your thoughts or come and collaborate with us on LinkedIn and Facebook.

Regards,

Richard Snow - VP & Research Director

Actuate Brings Innovation to Performance Management

12/15/2009 7:31:41 AM

The advancements in business applications for performance management do not come very often in the industry but Actuate has one that we should all pay notice. Actuate who has been advancing the open source agenda with the BIRT community project to simplify the access and use of business intelligence and what is now called information applications across the industry has just announced Actuate BIRT Performance Scorecard 9. This release is the culmination of a significant amount of experience in development, deployments and knowledge of how business operates across executives, management and managers who need to work closely to drive improvements to performance every day and every week. This release and accomplishments is no easy accomplishment since many technology providers have been working hard every year to advance performance management through integrating methodologies and trying new sets of capabilities to make techniques like scorecards easier to use.

Actuate has brought forward an online professional community for business and IT to advance performance management by surfacing best practices, collaboration, content and applications integrated into directly into the application. Actuate has done this by taking what they learned in the current developer community at the BIRT Exchange to bring a community called BIRT Scorecard Exchange for business and analyst professionals that want to have access to high value content and collaboration for accelerating their performance management programs and processes. This business exchange is more than just a place to get access to pre-defined scorecards, Actuate in fact has provided access to metrics and definitions by industry, function, framework and roles to help any organization get started rapidly. But most valuable for many with the professional focus to advance performance management is the need to collaborate and discuss methods for improvement from best practices and tips to having a range of applications that can be published into the BIRT Performance Scorecard technology including BIRT Stimulus Management and BIRT Sustainability Management. Actuate does not get credit for their work to advance specific industry and business needs through their applications which are great ways to not just get started but deploy what Actuate calls rich information applications rapidly.

Actuate BIRT Performance Scorecard has become an application framework where specific business applications can be accessed and deployed. This is possible through Actuate BIRT and the platform portfolio of studio and designer capabilities supporting what I recently have defined as information applications (See: “Information Applications: New Generation of Information Technologies“) that I recently assessed as part of their advancement s in the summer of 2009 (See: “Actuate Steps Forward to Power Information Applications“). This is important to note as Actuate is promoting business and consulting partners to share their applications in the BIRT Scorecard Exchange so that the industry as a whole can mature.

In this BIRT Performance Scorecard 9 release Actuate has gone well beyond just a set of features and advancements but has tackled the tough problem in integrating simplicity with sophistication for a ran

NICE Systems Supercharges Contact Center Technology for 2010

12/11/2009 12:02:58 PM

When you think of the big vendors in the Contact Center space then NICE systems sits right up there with Aspect and Verint. All three offer a suite of products that cover similar functional areas and my research shows that between them they dominate market share in what is often described as the “the workforce optimization” space. Even in a tough market place, NICE has performed well in 2009 and has been able to add to its already large customer base. This has allowed it to invest in its product portfolio and bring to market new capabilities that will help companies improve the performance of handling customer interactions and contact center operations.

For me workforce optimization includes five main areas of functionality: call recording, quality monitoring, workforce management, training/coaching and performance management (analytics) and part of agent performance management which I recently researched. During 2009 Nice delivered new capabilities including: increasing the volumes of calls that can be recorded, SIP trunk recording; analytics driven quality monitoring to help with agent coaching; multi-channel agent scheduling; workforce management for flexible scheduling and use outside of contact center; automated agent coaching; and interactive analytics across contact center data.

The very latest development enhances NICE’s ability to deliver cross-channel analytics. As customers change their preferred ways of communicating, companies have to respond by supporting more channels of communication such as e-mail, chat, mobile text messaging and social media. It is therefore vital that companies understand what channels of communication customers are using, and for what purposes as I found in my customer experience management (CEM) benchmark research. It is equally, or even more important to understand when customers begin an interaction on one channel but complete it by using one or more additional channels. The trick is to understand that disparate interactions might be from one customer – independently of channel – and that they relate to the same incident. NICE does this through a combination of voice analytics to understand, for example, that a call is as the result of a chat session, text analytics to understand the content of text-based interactions; and integration with systems such as CRM to identify that a series of interactions all relate to the same case. The new features also include root cause analysis which companies can use to identify why the sequence of interactions started.

All of these sit alongside developments which now mean many of the products are now available on a hosted (or cloud-based) basis, making them more accessible and affordable, especially for companies with small to medium size contact centers. This is particularly exciting as my research confirms that the majority of contact centers have fewer than 200 seats and hosted solutions open up the opportunity for them to take advantage of functionality normally only affordable by larger centers as also found in my research.

All of the signs suggest that 2010 will be “the year of the customer”, as the economy begins to pick up and companies focus more on improving customer service and in doing so drive up customer satisfaction and revenues. So although much of what NICE has been doing has been focused on the internal operations, increasing these new developments (and other new ones in the pipeline) will support companies in their efforts to improve the customer experience, improve the effectiveness and efficiency of handling customer interactions and make the agent’s life easier. All in all, companies that want to get smarter at handling all types of interactions would do well to keep track of what NICE can do for your

SAP Brings Business Intelligence and Business Analytics Advancements to Industry

12/10/2009 6:24:19 AM

At the 2009 SAP Influencer Summit, the executives at SAP outlined their overall future (See: “SAP Broadcasts New Enterprise Software and Applications Strategy“), but also the advancement of not just business intelligence (BI) but also business analytics. As everyone should know by now the importance of these technologies are for not just finding out how and where your organization is performing but what might happen in the future too! It should be no surprise that one of the largest enterprise software vendors like SAP has invested and grown significantly through the acquisition of Business Objects with also organic development of new business intelligence technology and analytic solutions for business and IT. In fact just recently at SAP Sapphire conference, the demonstration of SAP BusinessObjects Explorer (See: “SAP Announces New BI Explorer: Even a CEO Can Use It“) was on the main stage. Now BI has not come at a low cost for SAP who has had to make many tough decisions on their product roadmap for integration of platforms to simplify deployment and management of the technologies as well having to compete aggressively in the market.

SAP is moving along in advancing their current release of SAP BusinessObjects XI 3.1 portfolio to their next major release which is most likely going to be XI 4.0 and what you might hear as code named aurora and pioneer that is expected in second half of 2010. This release will bring a common platform that will support a range of BI capabilities well beyond today’s SAP BusinessObjects Explorer that was until recently only accessing data from SAP BW through SAP Business Intelligence Accelerator technology. The new release in 2010 will bring a new and improved semantic layer to their platform that will blend the best of Business Objects and SAP BW technologies but more importantly provide enhanced flexibility for dynamically accessing data from across the enterprise. In addition the advancements of usability are significant with the new version along with expanded support within Microsoft Office and web editions. The interactive analytic set of capabilities operates in high scale by using in-memory technology of their accelerator and 64 bit computing technology that will also operate against traditional OLAP cubes. SAP will also be upgrading the embedded BI within the SAP Business Suite of applications to address those direct needs of operational BI for which they compete against Oracle the other large enterprise applications vendor.

More capabilities will be in this release as SAP finalizes capabilities and readiness through their beta software program. I personally would like to see better use of events from complex event processing (CEP) into the BI offering for which I call Operational Intelligence and our benchmark research shows is a growing priority and where the use of geography could enable what I call Location Intelligence can help pinpoint issues and opportunities quite easily. What is still not obvious is how this release will foster collaboration across business and IT from a data perspective who should be working together more closely for assembling and advancing BI for the enterprise. This new release is a significant step forward as it is the culmination of significant technology rationalization into a common platform for which will be a new generation of business analytics and performance management solutions. SAP has spent significant time

Salesforce Cloudforce – Socializing and Servicing Customers in the Clouds

12/10/2009 6:09:28 AM

For those of you that didn’t get to Salesforce Cloudforce in London, Englad which was the regional user event or seen a salesforce event then I can tell you that when it comes to hoopla and hype, very few vendors outdo Salesforce these days. Further progress since my last analysis earlier this year (See: “salesforce.com brings New Cloud Computing Ecosystem to Europe and Internet”) As Mark Benioff the CEO was quick to tell us, despite trends in the industry, revenues are up, new client deals are up, and registered subscribers have broken the 2 million mark. All of this is testament to what I believe, which is that the cloud argument is won and many more companies are now looking towards cloud-based solutions as they look to upgrade or enhance their IT systems. The big question is what companies expect when they get behind the hype and what business issues do the Salesforce application actually support.

First and foremost one can’t ignore the fact that Force.com, software platform as a service has produced one of the most revolutionary development environments for decades. User after user, partner after partner, ISV after ISV make comments such as “it is easy to use”, “you don’t need experts to developed new applications”, “it is much faster than expected”, “it is easier to integrate”, and of course “it is cheaper”. In fact one or two CIOs went as far as to say (in private as well as publically) that it was the first time in their history that they were able to focus on innovating their IT architecture rather than just keeping what they had in place running.

But Force.com is really for the IT and ISV community and line of business professional need to know what it can do for them. The answer boils down to 4 things: improve sales operations with SFA, support employees resolving all types of customer interactions, development of smarter, easier to use customer portals and user communities, and enable greater collaboration within a company. Sales Cloud 2 includes all the functionality required to support SFA, including creating contacts, managing opportunities, a rather neat new way of scheduling meetings that avoids multiple calls or emails, a knowledge repository that makes it easy to find, view and amend sales materials, and all the dashboards and reports (which have been made easier to configure) that different users need to manage sales.

Salesforce Service Cloud 2 is slightly more difficult to position. The name suggests that in a similar way to Sales Cloud 2 that it is about managing a customer service operation. In reality what it supports is what I term a smart desktop and a customer portal – both absolutely essential capabilities to make handling of customer interaction, either over the phone or through a self-service portal, not only more efficient but effective, thereby saving operational costs and delivering enhanced customer experiences which as my benchmark research finds is essential for business today. The smart desktop essentially brings everything known about a customer, both past and present, together on a single desktop making it much easier for customer service agents, inside or outside a contact center, to resolve customer calls. The information includes all the static data about the customer and records of all past interactions, including items downloaded from social media sites such as Facebook and Twitter. This full view allows agents to resolve calls quicker using the channel preferred by the customer e.g. a customer that first raised an issue on a social media site can receive the solution via the same site. Salesforce Service Cloud 2 also supports companies creating smart customer self-service portal and customer community sites where customers c

Business ByDesign is SAP’s Strategic Proof Point

12/9/2009 8:54:18 AM

I think the upcoming full scale roll-out of SAP Business ByDesign (ByD), an on-demand business application suite, is a critically important proof point for SAP’s strategic direction as referenced in my colleagues review of recent SAP Influencer Summit. It’s not just from the standpoint of: Do-they-have-the product to address midsize company’s enterprise software needs and do they have the messaging and the go-to- market execution to follow through to succeed? I believe ByD’s outcome has implications for how successful SAP will be in evolving its core large company enterprise software suite. It will be a test bed of core technologies that have implications for how the company evolves its product offerings and will measure to what degree SAP can shed some its internal inertia. I have no interest in pre-judging the outcome.

SAP has been criticized by many for what they perceive to be ByD’s tepid entry into the on-demand/SaaS applications market several years ago. It’s slow, cautious approach (limiting it to about 100 initial users) following a PR splash appeared to be a lack of commitment, conviction or follow through. Possibly this is partly the result of SAP’s history – going back to the 1990s - of failing to execute a small/medium size business (SMB) strategy, most notably in North America. Perhaps because of this, SAP is being extremely cautious in rolling it out.

ByD (and the SMB products – SAP Business One and Business All In One is important because – notwithstanding SAP’s existing presence in SMB markets – there is significant long-term revenue opportunities in extending its market presence in this area.

There are four proof points that we be a measure of how well SAP is executing its ByD strategy – and by extension how well it will be able to grow the rest of its business over the next five years.

Proof point one is delivering a superior user experience. SAP traditionally has not had good user interface and application flow design. Business All in One and Business One are beginning to improve but from what we saw the current version of ByD has a long way to go. Moreover, rather than simply being as good as the next guy, the company recognizes it has the opportunity to do much, much more to make using its software a slick experience. Not only the user interface but flow and clickwork through the application. I have thought for the past couple of years that the upcoming challenge for enterprise applications vendors was to harness technology to wrap software around the business process – not the other way around. ByD is trying to get there, but we’ll see how it looks in a year or two.

Proof point two is demonstrating that SAP can deliver fast time-to-value and affordability consistently. Midsize companies have requirements similar to larger ones but lack their budget to buy, implement and maintain the applications. For years, faster customization and easy maintenance and operation of highly functional applications have been key objective because it will reduce the total cost of ownership without compromising business value. The SMB sessions I attended at the summit had a number of customer proof points and the product demos showed it was relatively easy (in some cases with limited training) to develop applications for Business One and Business All-In-One that, for example, develop and integrate on-premises with iPhone applications. Much of this will apply to ByD, especially enabling partners to develop small applications. So it seems likely that partners will be able to prod

SAP Broadcasts New Enterprise Software and Applications Strategy

12/9/2009 8:50:57 AM

At the 2009 SAP Influencer Summit in Boston, SAP took the time to provide their 2010 and beyond strategy for their enterprise software and applications business. The event with hundreds of influencers was led and moderated by EVP of marketing, Jonathan Becher provided a balance of humor and insight on the future of technology and the range of what SAP is addressing in the future. I had an opportunity to digest their sessions and meetings to assess SAP impact to the business and technology industry and where they are strategically heading. The core of SAP application business has been under duress over the last year with challenging economic climate has reduced technology spending for enterprise applications. SAP also recognizes their customer’s environment to see how they can help address many of their issues and industry trends like networked business, rising customer power and sustainability as directly impactful to new and future solutions to market. I personally believe these are good but helping business and specific LOB manage their specific areas of responsibility is a top buying agenda outside of IT and is also part of the portfolio of priorities for SAP in 2010. Much of the summit was on the enterprise applications and software strategy of SAP to influence their differentiation and approach compared to other large software providers like IBM, Oracle and even salesforce.com.

SAP has examined their direction since Sapphire and our analysis (See: “SAP Communicates New Clarity for Business at SAPPHIRE“) to look at how they can become more transactional or provide more bite-size solutions for organizations to purchase and deploy in shorter periods of time. Amazingly much of what was presented addresses many of my colleague’s points from the conference (See: “What Léo Apotheker from SAP Should Have Said“). Expanding the volume of business transactions to address the shortfall of larger enterprise size global application license sales evident in their financials is a number one priority at SAP. But this shift requires new executives that are willing to drive change into SAP with no ties to the past approaches which is why newly promoted executives like John Schwartz to executive board, Jonathan Becher to head field and solution marketing and Sanjay Poonen to head global sales of business solutions like EPM and GRC are critical steps to infuse new energy into their strategy and plans. I see the changes in the front office of SAP as critical to find new methods for engaging with customers of all sizes and needs for solutions to address specific business issues.

The direction of SAP product strategy was led by Jim Hagemann Snabe who is a member of the executive board who outlined how they are increasing speed of innovation through four key areas including helping customers scale core business, innovate via extensions to SAP, extend our customers reach and provide the technology orchestration necessary to make SAP efficiently operate in the enterprise and business network. Part of this is to also adjust the range of product and technology strategy is to be more agile than ever before in adjusting to new buyer demands for solutions. This agility is no easy task for a company of SAP culture and legacy for how they operate and manage their customer relationships across vertical industries and the world. SAP is balancing these innovation investments across SAP Business Suite 7 and my previous analysis of this suite (See:”SAP Business Suite 7 – Is the Suite Sweet?“) and SAP BusinessByDesign to range of new areas like business analytics and mobile based applications for range of business and consumers users as also seen in this year’s SAP annual

Cloud9 Analytics Make Sales Pipelines Deliver Results

12/4/2009 6:08:53 PM

The importance of maximizing the potential of your sales organization is to help them close as many sales opportunities as possible. But keeping tracking of the changes that happen routinely is more than difficult. Sales opportunities are continuously updated but the impact of those changes to the sales forecast and overall financial health of the organization is not well understood. In most organizations the attention is focused on sales forecasts that are usually aggregated and lose the sales opportunity detail by geography, customer, time, value and stage that is needed to understand issues and opportunities. You need to know the impact of changes that happen on a daily and weekly basis that impact the monthly and quarterly sales forecast. In addition as executives and management review sales forecasts they realize that investigating why there are so many changes has no quick answer or method to review the cause. It is no surprise organizations recognize sales processes as strategic to the health of the business will focus on the sales pipeline as a strategic investment.

Unfortunately for many organizations they have seen the limitations of current sales pipeline efforts that use spreadsheets that do not keep track of critical details or changes in deals. Or for other organizations who just have basic reporting or dashboards with tables and charts from their sales force automation (SFA) systems. This issue is easily addressed by dedicated software designed for the sales pipeline process that provides the necessary analytics and processing of sales information. For most organizations the bloating which are opportunities with higher deal values or leakage where opportunities disappear without reason is not well understood. This issue of the ‘devil is in the details’ of your data can dramatically impact your sales forecast and financial results. Anyone remember the quarter where Siebel Systems who led the SFA market for many years missed their quarter by over $40 million? How long did it take them to find out that their sales forecast was inaccurate and the details in the sales pipeline could have helped address issues or more importantly provide earlier notice to the shareholders?

I have seen how one provider Cloud9 Analytics a provider of sales pipeline management has changed how organizations establish their sales pipeline process and information for improving sales results. Recently at Salesforce Dreamforce conference Cloud9 Analytics brought forward new capabilities in extending the value of SFA into where goals, incentives and booking information can be integrated together including from ERP and CRM systems like Oracle and SAP. Cloud9 Analytics offers what is called Sales Pipeline Accelerator Suite that provides a range of capabilities to help manage changes in the sales pipeline that can be dynamically notified to management where needed. Even easier is that you do not have to buy and install the software as it is available in a software-as-a-service (SaaS) rental approach as part of the cloud computing industry. One of the capabilities is the waterfall analytic technique that can provide sales management to sales individuals the ability to keep an eye on changes and take actions where needed. In fact having visibility into the sales pipeline was the top desired capability by 87 percent of sales management according to our Ventana Research Sales Performance Management benchmark. These capabilities are part of what you do not get in Salesforce and other SFA systems which is why the Cloud9 Analytics is gaining further adoption and deployment

Plateau Provides a Suite for Workforces to Become Best Talent

12/3/2009 6:53:20 AM

I had an opportunity to review the latest in products and progress by Plateau who is a leading provider of Talent Management suite of applications covering learning, performance, compensation, career and succession management. Plateau currently has over 10 million employees using their software and content which is part of their primary focus in rental-based software as a service cloud computing model. Plateau has been advancing their efforts with growing in bookings and high customer retention despite a troubling economic environment and timid behavior of HR executives to invest significantly into applications for their workforces. Plateau recently had their annual conference where I had a chance to review their education and latest in product direction and customer presentations like Allianz, Boston Scientific, Diebold and Southern Nuclear.

The main focus by Plateau is on their Talent Management suite that in their latest release version 6.1 brings key advancements across their platform and applications. To address the usability of the overall suite they have streamlined the user experience by providing an employee home page, navigation, performance indicators and To-Do List. In addition a much simpler means to navigate and link to other applications, information and services has really helped Plateau in growing their business but most important for their customers. Plateau has also improved their performance review capabilities with an informative and workflow-based approach that enables simpler manager and employee collaboration for providing a method for scoring performance. The performance application is a critical link between learning and compensation to drive talent management processes like pay for performance.

Plateau provides guidance for organizations to easily assess overall performance and determine the current and planned progress in using their learning management capabilities. Plateau has also streamlined the use of third party content in what is called iContent that can help your workforce improve through learning by developing subscription content as service approach. Of course the improved access and usability of organizational and employee information is easily seen in their applications and essential to support generations of workers. Part of that information is for individuals and management to have access to integrated metrics and reporting using Plateau Analytics.

To address the need for workforces to collaborate and interact more routinely Plateau has a platform called Talent Gateway. This enterprise-focused social computing platform provides a place for workforces to collaborate and network within a trusted community environment with message boards and discussion groups along with ability to post blogs and use Wikis for education purposes. I recently made note of this at the industry conference called HR Technology (See: “HR Tech Brings New Products but HR Budgets May Limit Potential”). This pragmatic set of enterprise capabilities helps bring social collaboration and networking directly into the needs of organizations unlike much of the industry conversation on Internet approaches with Facebook and Twitter. Plateau has been able to rapidly advance into this segment through using the open source capabilities of Liferay that has been used to build this platform. This set of capabilities is critical for organizations

Callidus Software Simplifies Sales on Salesforce Platform

12/2/2009 7:41:23 AM

The need to simplify and optimize processes continues to be a key agenda item for all organizations and sales is ripe for improvement. Sales organizations of most midsized business are especially in need for automation and improvement in this area that is still dominated by the use of spreadsheets, presentations, documents and email. These personal productivity tools were not designed for sales compensation processes and have been inflicting delays and frustration in sales and finance with scattered and unreliable information. Recently at Salesforce Dreamforce conference, Callidus Software unveiled new sales compensation software products for those using Salesforce. The two solutions Callidus Plan Communicator and Commissions Manager help organizations off-board from using dedicated spreadsheets onto a solution that uses software designed for the process and for management to ensure accurate and fair commission and incentives are paid.

Callidus Plan Communicator helps with the rollout of compensation plans to the sales force but integrated in with the use of salesforce sales force automation software simplifying the access and review of an individual’s plan. Callidus is also including an enablement service that provides consultation for transforming from spreadsheets into the solution easing the knowledge and resources needed to make improvement. I believe this is the type of support that especially mid-size organizations with 15 up to 100 sales representatives on compensation plans need to automate this process. This new software as a service based application has been in use and is now generally available. The solution is not intended for complex sales plans but will meet the majority of mid-sized organizations that have defined products and services with set commission rates and accelerators.

The focus of the new announcement at Dreamforce was on Commissions Manager which is also a native application developed on the Force.com platform that helps sales operations work with sales management and representatives that need to track, claim and resolve commission credit. In addition the application provides performance dashboards for managers and representatives to assess performance to quota, commissions paid and status of credit for sales closed across teams where disputes can typically arise. The application provides critical workflow and approval routing to streamline the commission process that is typically dragged into emails and phone calls. In addition for those in finance or CFO of organizations can readily review sales commission and progress to determine impact to the monthly and quarterly financials which has traditionally been more of a secret to the last moment than transparent on a daily basis. Our benchmark research on sales organizations identified this need for managing commissions as a top priority for sales operations teams along with sales representatives and management.
In addition Callidus Software announced they will be expanding their entire suite on top of the Force.com platform to further embrace the cloud computing advancements at Salesforce that we also assessed (See: “Salesforce Chatter Brings Social Collaboration and Media into Business“ and my colleagues assessment “Salesforce Dreamforce: The Business Focus of the UnSoftware“) . This announced expansion goes beyond other suppliers for sales compensation and sales performance management that have just released one application th

Splunk Expands IT Search into Information Applications

11/24/2009 5:01:32 PM

The need for IT professionals to be more responsive to their processes and systems or address underlying issues in their systems is no easy task for many organizations. In fact most IT organizations have dozens of applications and systems that generate notifications into log files that generally go unused. These files traditionally have been a challenge to determine severity of information in them and provide them easily to a range of individuals in IT who need to be pro-active in management of their systems and not reactive. In the last several years a technology vendor named Splunk has come to market with a solution to index these volumes of log files and provide search and display capabilities along with now a new generation of interactivity and application capabilities. I wrote about the advancement of search for IT earlier this year (See: “Search Technology Innovates Business and IT This Time“).

This year Splunk released version 4 that brought forward improvements to the performance and scalability of their indexing which is now two times faster than previous release and information retrieval resulting is 10 times faster than their previous release. This along with the ability to handle concurrent and background searches provides the ability to multi-task requests for IT information. They have made improvements to performance along with massive advancements in the scaling into terabytes of data across systems and sources. Splunk also has brought forward a search assistant to make simplicity of semantics in the IT search for information much easier. Splunk has also made it easier to manage the IT information assets from data sources to the processing of indexing the data along with archiving. Splunk can access a variety of platforms and sources, and database and applications like IBM, Microsoft, Oracle and SAP to the network and security systems from Cisco, F5 and CA. In addition the Splunk server technology can be distributed across servers to maximizing the processing of IT data where it is being created along with where the users will access the information via search and applications.

In addition Splunk has made it easier to assemble reports of IT information through an interactive process to pick data and display methods to present IT information along with the ability to save and share them too. This information can also be used in the assembly of dashboards that integrate the search and display of the IT information into custom built dashboards. Even further the dashboards can be made into interactive information applications (See: “Information Applications: New Focus on Information Availability“) that is a new type of application that has recently entered into the industry to speed up the process of having focus built applications on specific types of information. Splunk has released an application framework and launcher to make it easier for customers and partners to create applications for deploying and accessing Splunk is also using it bring their own pre-built applications for technologies like Cisco, F5 and Blue Coat. Splunk also provides solutions address key areas like application management, operations management, security and compliance. Our benchmark research in IT performance management found lack of resource and limited budget as issues to improving IT operations and Splunk has addressed these issues quiet nicely with their packaging and pricing along with bringing the functionality needed for IT analysts to IT management.

Splunk has mad

Salesforce Dreamforce: The Business Focus of the UnSoftware

11/20/2009 1:59:34 AM

Having attended Oracle Open World not long ago in the very same Moscone Center that Salesforce.com held this year’s Dreamforce, I was consistently struck by the ongoing focus on business value and how Salesforce.com’s “UnSoftware” addresses business issues for sales and marketing people in companies of all sizes. To be sure, there was plenty of the its-all-about-the-cloud evangelism and chest thumping in evidence. But where Oracle was almost all about the database, middleware and other technologies, and where the vast majority of people were from their company’s IT department (unless you squeezed into the Intercontinental to see the Hyperion and other business-themed software sessions) there was almost no connection between technology and solving business problems – including IT’s business problems. Open World’s weakness (though in a more narrow sense its strength) is that it’s IT for IT’s sake.

My use of “UnSoftware” is a play on the old Seven-Up “uncola” pitch. It’s also inspired by another industry analyst’s insistence during a Dreamforce analyst session that the company actually was using software and therefore the ‘no software’ motto was nonsense. His point was a bit puzzling to me: since when did technology buzzwords have to be accurate or even sensible (ERP doesn’t plan, “client-server” means more than just network architecture, etc.). No-software software? No problem – almost everyone knows what the company means.

Over the last 18 months Salesforce.com has been transitioning from its early days of claiming it was the new game in town to actually being the real deal. In the beginning, Salesforce.com’s value proposition was about fulfilling on the basic needs of sales force automation flexibly and inexpensively. This sounds simple but it was a need that went unfulfilled for two decades.

When the first successful SFA desktop apps like ACT! appeared in the late 1980s, it was mobile only to the extent that you loaded it onto your 28 pound (13kg) Compaq luggable PC, which with some diligence could be connected to the office with a 300 baud (that’s a zero-dot-three bit rate) modem. These desktop apps did a good enough job of organizing contacts, meetings and the other basics. But they were an imposition on the sales process and difficult for field sales people to use because of the limits of the technology (not to mention the weight of the machine that made it work).

In a client-server environment, SFA applications became more valuable to sales management in automating sales administration but they became even more of a burden to sales reps. Moreover, Siebel’s all-singing all-dancing toolkit approach made implementing even a straightforward sales management/SFA solution ponderous and expensive. Putting the standard SFA application capabilities “in the cloud” in a dedicated application was an important first step to making SFA more useful because the bulk of the people using the system were doing so when they were out of the office on the far side of the firewall. The architecture of the application is consistent with the structure of the business process. It was so well suited that it propelled Salesforce.com quickly into a major UnSoftware company. If the company had decided that its mission was accomplished or if it had not started to make its initial claims real, it would be in plateau mode by now or at least in the near future. That’s not the case.

Beyond the shortcomings of the client-server or desktop architecture, there was a fundamental flaw in the design of all 20th century SFA systems, These first apps (and especially early enterprise programs like Brock Control Systems and Saratoga Systems) addressed the needs of sales managers first and the salespeople second (often a very distant second). Getting salespeople to fully use SFA systems was a tough sell because they took time and effort from the salespeople that they could be using to sell (or play golf) without giving muc

Salesforce Chatter Brings Social Collaboration and Media into Business

11/19/2009 1:39:09 PM

At Salesforce.com Dreamforce 2009 conference a new generation of technology for enterprise class collaboration and social interactions has been introduced for business called Salesforce Chatter. Salesforce describes this as a new ‘Cloud’ of computing beyond their sales and service clouds that are already available in their second generation cloud versions. This interestingly named product, Salesforce Chatter is a combination of collaboration technologies that enable Facebook like interfaces for discussion across sales and service applications within Salesforce.com. The software is available as a service where you rent access to the use of the collaboration capabilities on a monthly basis but available as part of existing subscriptions to Salesforce CRM applications and platform.

Salesforce Chatter bring capabilities include sharing of discussions in public, private and even secret groups to the ability to use Twitter functionality for broadcasting status but also requests that can be consumed by those that follow specific content and people feeds in a business. Specific business groups are setup easily like Facebook where you can join and collaborate on business topics. In addition applications whether social or enterprise (i.e. SAP) can be setup to broadcast updates can be followed by anyone with proper level of rights and authentication. In addition, posting and packaging of content as they are posted and broadcasted so that can people can see that it is available to use. Salesforce Chatter uses the security model of Force.com platform across content, applications and people where granular of security can be applied to the business collaboration and social computing.

Important enough is that Salesforce Chatter is available directly within Salesforce applications like sales and service but also can be part of native applications built on the Force.com platform by organizations or partners. In addition the Salesforce Chatter is directly available on mobile technologies from Apple, Microsoft and RIM to ensure that it is readily available anywhere business people operate. Sales professionals can use this to collaborate on sales opportunities or gain access to information relevant to look at best practices. Customer service professionals can use this to request assistance or find information relevant to resolve calls as discussed by my colleague (See: “Salesforce.com Brings Social Media to Customer Service“). Salesforce is making the collaborative capabilities directly as part of existing software subscription and for other organizations who can pay a $50 per use per month for the software.

Salesforce Chatter is a gigantic step forward for organizations that previously had to purchase multiple packages of software and install in the enterprise and maintain expertise to ensure it operates properly and is maintained by IT professionals. Of course this has significant impact to how organizations examine how they want to bring the power of social collaboration capabilities available on the Internet directly for their business and into enterprise. Just as Lotus Notes innovated in the early 90’s with capabilities of collaboration and sharing of information, Salesforce Chatter brings a new generation of capabilities that now over half billion of people already experience with Facebook and Twitter. Salesforce is committed to ensure that enterprises can easily onboard and license capabilities in enterprise agreements as Microsoft has done over the last decade with Microsoft Office and Microsoft Sharepoint who is clearly the main competition along with IBM Lotus and provide

IFRS Scams to Come

11/19/2009 6:48:33 AM

Once again I will put my securities analyst hat (after spending couple decades as one) on as I write this blog.

I’ve commented on International Financial Reporting Standards (IFRS) in terms of its impact on the IT environment (See: "IFRS and IT Choices: Are You Planning?"). The Financial Accounting Standards Board (FASB) recently reaffirmed its intention of harmonizing US-GAAP with IFRS so that there will be something approaching a world standard. While the shift to a US IFRS may be an improvement over US GAAP, it will not be without a number of issues.

I’ve been a frequent critic of the current state of US GAAP, which to my taste has listed too far to a rules-based approach to accounting (as opposed to a principles-based one). People who are not well versed in it generally are under the impression that accounting is an exact science. Not so. While (as the old saying goes) bookkeeping is a matter of facts, accounting is a matter of opinion. Like any kind of analysis, the accounting standards for the presentation of the bookkeeping “facts” have a great deal to do with the answers you are seeking (and therefore the questions you are asking). Some of these answers are inherently more or less objective which limits the degree of interpretation that can take place. But not always and not always in areas you would think are straightforward. Take revenues, which should be straightforward – right? I sell something, I collect the money, and I call it revenue. Whoa! Not so fast buddy. I won’t bore you with the myriad rules covering the way accountants are supposed to handle revenue recognition (that is, count a sale as a “sale”) under US GAAP, but over the past decade the complexities have multiplied. That’s just revenues. Expenses, the treatment of the valuation of assets and liabilities, accounting for leases and stock options, how you depreciate property, how you handle retirement benefit obligations and so on, have all added layers of complexity. One of the oft-stated reasons why FASB has piled on so many rules over the past 15 years (echoed by most major media outlet business writers that I read) is to give the little guy – the individual investor – a more “accurate” measure of a company’s results. Unfortunately, I believe the opposite has occurred. Exhibit A is a recent move in Apple’s shares when a change in revenue recognition accounting for the iPhone (US GAAP forced the company to take a revenue recognition approach that was wildly understated relative to cash flows) caused a spike up in the stock. Most professional investors that understood the accounting issue but individual investors who were not paying attention to (or ignoring) the non-GAAP treatment were left to chase the move up. Worse, I know from personal experience that companies are doing dumb things for the sake of accounting. There’s nothing new in that, but the as the rules multiply the number of dumb things seems to have gone up.

Both the US Securities and Exchange Commission (SEC) and FASB (which has responsibility for interpreting US GAAP) have decided to punt and adopt IFRS, a principles based accounting standard that has been adopted by the European Union countries and, soon, Canada, among other countries. The shift reflects the increasing global nature of financial markets and therefore a desire to harmonize US accounting rules with the rest of the world. I think it also is an admission that all the rule making has made a mess out of US GAAP and the easiest way to address this is to adopt IFRS.

At this point, the switch is supposed to take place in 2014, but 2016 seems like the earliest it will happen. One of the major sticking points in harmonizing is revenue recognition. Many of these rules stemmed from a very fast and loose app

Merced Systems and Nexidia Partner for Agent Performance Management

11/17/2009 3:56:56 PM

Merced Systems has been working hard over the last few years and advanced companies with a more formal, analytics-driven approach to managing contact centers with a focus on agent performance management for better customer service. My research into customer experience management confirmed this is something companies really need to do in order to optimize the performance of their agents and ensure that customers experience much better service when they call into a company’s contact center. The Merced Performance Suite combines data from several sources to provide an analysis of just how well agents are performing and therefore which agents need focused training into how to handle interactions better.

Nexidia is one of a few vendors that has spotted that call recordings contain a great deal of information about how agents are performing and also about how callers are responding to how they are treated by agents (see “analyzing voice recordings”) . The issue in the past has been accessing this information simply because recorded calls have no fixed structure, making them very difficult to analyse, Nexidia’s phonetic search technology enables it to unlock this information and thus support analysis into the content of calls.

Their recent joint announcement to partner in this space therefore makes absolute sense as it furthers both companies ability to support companies as they try to get to grips with optimizing the performance of their agents. Nexidia’s ability to analyse the content of calls will feed nicely into overall analysis supported by Merced, giving companies a much fuller insight into why customers are calling, how agents are dealing with those calls, and it will also add to the company’s view of their customers. Another added bonus is that the combined solution will allow companies to link example calls to training recommendations, both allowing agents to hear where they are going wrong and examples of how other agents are getting it right. My benchmark research into agent performance management confirms that this channel of communication is essential to not just monitor but use to improve agent behaviour.

As companies fight to balance the operating costs in their centers with the need to provide customers with excellent experience, I recommend they see how this combined offering can help in their efforts.

Let me know your thoughts or come and collaborate with me on Facebook, LinkedIn and Twitter.

Regards,

Richard Snow - VP & Research Director

IBM Elevates MDM and PIM by Integrating Content and Analytics

11/16/2009 11:37:25 PM

I recently at the IBM Information on Demand event got a chance to examine the details of their efforts on MDM along with the rest of the information agenda related advancements (See: “IBM Doubles Down Again on Information Agenda at Annual Conference “). IBM who for many years has made many investments into IBM master data management (MDM) through acquisitions and has stepped forward with a set of significant advancements with InfoSphere MDM Server 9. In this release there are new technology components for supporting more sophisticated MDM. This includes integration with InfoSphere Master Information Hub and the new InfoSphere Master Content for MDM Server that integrates the ability to manage consistent content across the enterprise. IBM has advanced the management of content through integrating their enterprise content management (ECM) to MDM for a more complete and consistent view of information for inside of the enterprise and out to other parties including customers and partners. This is part of building the foundation for defining, integration and sharing content into MDM processes.

The role of MDM for data governance is critical and IBM has improved their workbench which is designed to be a place for analysts and data stewards to work with IT. Indeeed our benchmark research on data governance identified the issue of incompatible tools and disparate information. Supporting master information (content and data) across the enterprise has got much simpler with what they support and is called custom-built domains to manage specific information needs like finance, customer, employee, location and event pre-built information domains. IBM also has built integration to recently acquired rules provider ILOG. IBM also released advancements in the reporting and analysis through the use of IBM Cognos to provide more usable information about content and data as I assessed (See: “IBM Fuses New Generation of Analytics for Deeper Business Optimization“). Most importantly are the built in capabilities for data integration and for batch or real time synchronization that have been part of the information management portfolio. IBM has advanced their capabilities for more complex hierarchies and relationships along with providing advanced search to product information. In addition new user interfaces have made the management and visualization of organizations and hierarchies dramatically easier for analysts and those involved in the data governance processes. Managing a diversity of content and data to a single record definition is the essence of MDM but also part of establishing rigorous information management processes.

IBM is also advancing their specific product information management (PIM) capabilities in their dedicated PIM technology through InfoSphere MDM Server for PIM through usability advancements in authoring, editing, search and even programmatically via Java APIs. This specific PIM product can interoperate and work with InfoSphere MDM Server 9. Our benchmark research into product information management found that organizations are improving PIM for the number one reason of improving data quality as found in 56 percent of organizations. IBM has integrated these capabilities into IBM WebSphere Portal Server for broader access and deployment of product information across the enterprise. They have also integrated it with the InfoSp

Is This the End of Sarbanes-Oxley?

11/12/2009 3:06:47 PM

There has been a lot of fulminating over the Sarbanes-Oxley Act (SOX) in the week or so since the a House subcommittee added a provision to the consumer protection act legislation that would permanently exempt all companies with a market float of less than $75 million from compliance with section 404 of SOX. This has been described as “gutting” the legislation by some commentators, columnists and bloggers in major news outlets. I think that assessment is just wrong.

It’s possible that those hyperventilating on the exemption simply don’t understand the nature of these entities. Companies with a public float less than $75 million are typically mid-size corporations with somewhere between $20 and $70 million in annual revenues and between 150 to 500 employees, of which maybe a dozen or two may be in the finance department. Fortune 500 they’re not. For many of these companies, the cost of a section 404 audit is a burden in the time spent by employees and fees paid to auditors. I don’t think it’s unreasonable to exempt these micro-capitalization companies from bearing the burden of section 404 compliance at the possible cost of failing to protect people who are determined to lose money in the stock market chasing hot tips and penny stocks. (It’s unclear to me how section 404 would protect these folks anyway.)

The purpose of the Sarbanes-Oxley Act was to protect investors (especially individual investors) by reducing the risk they would get fraudulent (or at least materially misleading) financial statements from companies they invest in (See “Sarbanes Oxley, Risk Management and Internal Audit). Most individual investors do not own stock in companies with market floats of $75 million or less unless (1) they own the company or a big part of it, (2) they inherited a big position in it from Grandpa Gus or Aunt Louise who started it, (3) a very close pal or business associate is running the company or (4) they are a complete idiot, very likely on the receiving end of a pump-and-dump scheme. Professional money managers also deserve protection, to be sure, but they have more resources and training and have a diversified portfolio. Moreover, a fraud in a $50-million market cap company is not going to have the economic and social repercussions that frauds like Enron, WorldCom and Quest had (companies with multi-billion dollar market floats).

That noted, it’s clear that these 404 audits are not as burdensome as they used to be. For those who may not have been paying attention, a couple of years ago the Public Company Accounting Oversight Board made an important change to its interpretation of section 404, resulting in Accounting Standard (AS) 5. The big problem with SOX release 1.0 was that it confused the need for financial statement governance with finance department governance. Auditors (being auditors) saw the logical possibility that (for instance) poor travel and entertainment reimbursement procedures might cascade into the next Enron and so everything was fair game. AS 5 restored some sanity to the audit, explicitly forcing auditors to focus only on material risks directly related to the financial statements. It’s not an annual boil-the-ocean routine anymore. But I’m still willing to go along with the exemption because even if it costs less money than it used to, it’s still more money than these businesses can afford.

It’s true that after some study of the matter, the exemption may be expanded to those companies with a public float of $250 million or less. But that will happen because the cost of compliance is too burdensome for these companies relative to the potential benefit of the audits. Since those costs have come down considerably, this fear may be misplaced.
So unless I’m missing something, it’s hard to see the SOX exemption for the smallest public companies as anything more than vigorous exfoliation; not evis

Informatica Works to Bridge the Business and IT Divide

11/11/2009 2:31:20 PM

The business and IT divide has persisted since the dawn of business computing and, based on experience, I doubt it will ever go away. That doesn’t mean it cannot be managed better. One of the key objectives that Informatica had in its current release (Informatica 9) and covered by my colleague (See: “Informatica Brings Business and IT Together for Your Data in Version 9“) was to reduce business users’ dependence on IT to translate their needs into IT systems. The objective is to make it simple for business users to take care of 80%-90% of data definition and data quality issues involved in analytical tasks, while facilitating the interaction of business and IT to resolve issues on the fly. Instead of having, say, six people in IT who don't understand the meaning and context of the underlying data structure spending full time trying to collect requirements from end users and translate this into code, you now have the dozens of business analysts and/or trained individuals in functional roles each take care of their own requirements and have one or two people in IT finish the rest of the job. Rather than having a process that must be structured as discrete steps requiring considerable preparation and thought (like a chess match), make the process more interactive (like volleyball).

The latest release is Informatica’s attempt to achieve “lossless translation of business requirements into IT systems” (their words). There are three aspects to this.

One of the important requirements is giving business analysts and line-of-business users a self-service tool that is powerful but also conforms to their way of looking at the world. One aspect of this is an interactive capability – working with the data iteratively to ensure that data specifications, data mappings and data cleansing are accurate and conform to their business need. A second is enhancing IT productivity by giving business users and the department a common tool in which they can share their work. Today, business users use personal productivity tools such as spreadsheets and word documents to define requirements while IT uses development tools. By sharing a common metadata repository which contains all data and can manage it across the entire lifecycle of development, IT can pick up the loose ends that business users need help with. Third, the process requires an environment where it is easy for those on the business side to work interactively with IT people to resolve issues.

I don’t believe that Informatica has solved the Business and IT divide issue, but release 9 is an important step to increasing the productivity and effectiveness of business analysts and IT departments. That said, I think the “results may vary” caveat applies in the case of Informatica 9. All of the usual basic, blocking and tackling regarding skills, organizational culture and other issues will determine how much effort will be required up front for a company to be able to use the software successfully. There also will be the usual data maintenance issues. For instance, one of the features of Informatica 9 is the ability to define and save data cleansing rules or definitions on the fly. Analysts can, for example, choose a predefined (and vetted) ‘Fix Postal Code,’ ‘Validate SKU Number,’ or ‘Choose Best Customer’ routine. While this may work for simple, standard actions that people re-use frequently, based on experience I expect they won’t be looking too hard to find other, more complicated routines that suit their needs. The result will be a mare’s nest that will require constant maintenance and/or training to avoid or fix this issue.

launch of version 9, Informatica has advanced their data integration technology platform in a range of major data driven capabilities intended to ease the burden in working across business and IT to make data more readily available through data services for immediately processing data in real time across the enterprise. Informatica has also fully integrated their data quality technology into the platform for use across business and IT along with being part of their new SOA based data services for virtualizing access to data. In todays virtual keynote Sohaib Abassi, the CEO of Informatica and executives in a virtual conference format that provided a new format and gave his personal perspective on the significance of this new release but the relevance to issues in business and IT today. Most importantly the need to evolve to a data or information driven enterprise requires a focus and Informatica has advanced their efforts with support for business and IT collaboration, pervasive data quality and SOA based data services that I will discuss now.

Probably the most difficult task that Informatica has addressed is having a common platform for where business and data analysts can have the capabilities to engage their data requirements and review while operating in conjunction with IT and their data management responsibilities. Informatica has come out with the capability for analysts to define and review their data to ensure it is of the highest quality but also ensure they are getting what they need to get their job done. Without this, our research has found that they will continue to use their own silos of local databases or worse even use spreadsheets where they copy and paste their data to meet their own local efforts introducing potential data quality issues like varied definitions, wrong aggregations and calculation errors. This issue of errors in spreadsheets was found recently in our benchmark research on data governance. and in research on 21st century spreadsheets. In the demonstration by Informatica data integration product line EVP & GM Girish Pancha the simplicity of using web-based bookmarks into the Informatica platform and data provides a method to share points of discussion and issues where you can easily instant message or email to quickly review and resolve issues. All of these shared capabilities on a common platform now requires a collective decision across business and IT to work together and use technology and will require some nudging.

The lack of timely data has been a large issue in organizations as the sources and places of data continues to grow and places pressure on IT to improve their processes and technology. It is not possible today to expect that organizations will put everything in one or even more data warehouses in the right time frame or format. Just as we saw application to application integration in past years, now the need to have data services across systems in the enterprise is essential. To accomplish this Informatica has introduced advancements in providing SOA based data services across their PowerCenter platform building on their preview version’s and in many circles is discussed as data virtualization. The need to define and access methods to data as a service is now possible and takes data integration to a new level. Informatica data integration product line SVP & GM James Markarian discussed their advancements from examining and defining data services that are available and discover the under

Kronos Guides Workforce Software Across Generations

11/10/2009 8:22:51 AM

At the Kronos user conference, KronosWorks in Las Vegas the next generation of workforce management was revealed formally to its customers by CEO Aron Ain that will dramatically improve the usability of Kronos in new releases next year. I got an early preview of this technology recently at HR Technology conference where I indicated this is one of the exciting advancements in workforce related software (See: “HR Tech Brings New Products but HR Budgets May Limit Potential“). Kronos is a leading provider for hourly labor-based workforce management set of applications from time and attendance, scheduling, absence management, hiring and labor analytics who recently closed their fiscal year finding themselves with new business as the vendor market for dedicated software companies in this market to be very small.

Kronos keynote at the conference was very insightful with Dr. Ken Dychtwald a well known author of books like Age Wave and industry guru on the dynamics of the aging population. Ken provided startling facts on the next decades ahead in the United States and other countries that have a shifting age population that impact all employers and how they determine their future workforce requirements and available population of talent. In fact the baby boomer age group of 55 to 64 years of age has grown 73 percent and 65 and over has grown 55 percent, this compared to younger age groups of only 10 to 15 percent. This is all part of the dramatic life expectancy increases in the last hundred years from 47 to 78 years, where these generations are working longer and are re-engaging into workforce to support their lifestyle and needs for income. This plays a dramatic role for those of us in the software industry as new role-based user interfaces must also span across three and four generations of workers in one workforce. Now this is not just that ‘Boomers’ might need to be considered but that also ‘Generation X’ and more recent ‘Millennials’ demand work life balance and have less allegiance to one company but to their own needs and personal destiny. This also requires a rethinking of our workforce and talent management processes like annual performance appraisal that should be the quarterly ‘atta-boy’ as current methods do not appeal to newer generations of workers and should be adapted to increase employee loyalty and retention.

The latest release that over 250 Kronos customers have upgraded to in 2009 is version 6.1 where they have advanced a range of needs from improved workforce planning and scheduling to pro-active alerts, auditing and biometric support. Kronos who is well known for their labor analytics has improved their reporting and basic capabilities with integration to Microsoft Excel to more sophisticated analytics presented in dashboards and interactive capabilities for easier visualization of trending to root cause and cause and effect. A significant amount of focus in this release is on automation of a range of managing time and attendance related activities like scheduling, overtime, breaks, leave and other elements of workforce management pertinent in retail, health care, manufacturing and public sector industries.

The important event for Kronos was unveiling of their next generation of applications that use a simpler and more intuitive interface for a range of workforce management tasks including labor scheduling and also address the needs of m

CallTower Offers Unified Communications in the Cloud

11/5/2009 3:39:19 PM

It is often said that a company stands or falls on the quality of its communications. This can range from its ability to communicate effectively internally, across multiple locations, with employees working at remote locations (e.g. at home), with customers, and with partners, to the actual content of those interactions. My research into customer experience management shows that companies need to communicate through an ever increasing number of channels; everything from the telephone, e-mail, the Internet, fax, postal mail, instant messaging, and text messaging, Creating an in-house network infrastructure to manage all of this is a complex and expensive task. If you add-on the additional needs of a call center then the task becomes even more difficult and expensive.

CallTower have been offering their clients communication services since they were formed in 2002. In-line with overall market trends it has recently upgraded its offerings to be available “in the cloud” and it has bundled together a number of products to create a full Unified Communication (UC) offering (see “Unified Communications: Simpler and Eventually Cheaper Customer Interactions”). In practise what this means is that it is offering network control systems on a hosted basis in its data centers and customers can now access these systems via various forms of network. To support the necessary bandwidth and quality standards required for “plain old telephony”, customer can connect with a high speed T1 network, or through a public telephone network or indeed through the Internet, typically using broadband connections. This gives companies access to the Cisco Call Manger products to manage telephony traffic and various Microsoft products to handle other forms of communication and value-add functions. This includes Microsoft OCS, which allows companies to take advantage of presence capabilities, giving them the ability to identify everyone available to handle interactions no matter where they are logged into the network or what device they are using. CallTower also offers support for a growing range of mobile handsets such as RIM Blackberry.

All these applications are hosted in CallTower’s data centers which have full back-up and recovery capabilities. The applications are accessed just as for any other applications in the cloud and are provided on a monthly fee-based agreement. This means users have access to a full range of unified communications capabilities that can be accessed by any employee in the exactly the same way; whether they are in a front or back office environment, in a contact center or centers, based at home or mobile. It goes without saying that this model brings with it all the other advantages of cloud based solutions and puts unified communications within reach of small and medium size companies, at prices they can afford and without the hassle that is normally associated with putting together an in-house solution.

Let me know your thoughts or come and collaborate with me on Facebook, LinkedIn and <

Microsoft Office Live Workspace: Dead On Arrival

11/4/2009 4:38:57 PM

I’ve written in the past about products that allow you to use Excel and Word collaboratively, even if you don’t work in the same company. Years ago, my associate and I used to synchronize our spreadsheets using the original Groove, even though we worked on different sides of the continent. So I thought it was about time that I took Office Live Workspace for a spin – only to quickly find myself in a ditch.

Having installed the software I rebooted my computer. When I launched Internet Explorer all heck broke loose. I’m quite certain I’m in a small minority but for some reason (and by now I’m way past caring why) my system automatically started up Excel, which then stopped functioning, which automatically launched an alert to Microsoft, and then automatically restarted Excel which stopped again and launched another automated alert to Microsoft and on and on. At one point my machine was caught in the process of shutting down and notifying a series of three instances of Excel at the same time. Nothing would halt this infinite loop. Needless to say, it wasn’t happening in the background and prevented any work from happening. I tried launching Control Panel to uninstall Office Live Workspace but all the churn from Excel prevented that. I had to shut down and reboot my system. After launching Control Panel I noticed that there was a separate Office Live patch that was installed along with the main app (a kludgy approach to kludging – eh?). Thinking it would be logical to uninstall the patch first I started that process, only to find my computer launching and shutting down Excel in a dervish-like fashion. Halting that uninstall, I uninstalled the main application successfully and then the patch. Phew!

This has got to be a joke and plays to the (bad) Windows stereotype. I find the Apple Windows-trashing ads amusing in a way, but since I have to do tech support for my kids’ Apples, I’m in the “Crash Different” camp. (I once sat in the local Apple Store waiting for my slot at the “genius” bar to take care of a the second hardware problem in two weeks on a Macbook that I could fix on any Windows notebook myself and came to the conclusion that when it came to Apple products, PT Barnum was right.) In other words, choose your poison.

Still, it’s still very frustrating that something as basic as the concept of “Office Live Workspace” should be at this stage of immaturity at this late date. I’m not thrilled with any of the alternatives to Microsoft Office, for that matter, but given the amount of money we all are paying the folks at Redmond in the form of maintenance and periodic upgrades, it reasonable to have expected something that’s better. Certainly something that isn’t a complete disaster right from the start.

Let me know your thoughts or come and collaborate with me on Facebook, LinkedIn and Twitter.

Regards,

Robert D. Kugel - SVP Research

The Spend Analytics Imperative You Need To Perform

11/4/2009 3:20:57 PM

In downturns companies focus on ways to control outlays. CFOs (Finance Directors for those of you who speak the zedless and u-full version of the language) and controllers tend to rely on two levers to help them limit outlays. The big lever in a majority of companies is capital spending; the smaller one is travel and entertainment. Interestingly, CFOs and controllers with the longest tenure rely less on these items than those that are relatively new to the position. Why? Because the experienced ones know where to find the pockets of wasteful spending. During good times, it may not be worth the trouble (or internal political capital) to root out these spending issues. However, when belts have to be tightened these finance executives have plenty of suggestions as to where (and how much) to cut. That, in essence, is the objective of spend analytics which should be a priority of yours (See: “Effective Financial Performance Management – Priority for 2009"). To throw a light on where money is going – in good times or in bad – to ensure that unnecessary costs and wasteful practices are eliminated. Spend analytics is the foundation for spend management – you can’t control what you don’t understand and you can not optimize what you do not analyze. The analytics also must facilitate action by monitoring outlays, creating alerts when necessary and offering reports that provide visibility and decision support.

People, particularly if they’ve worked in a large company, know there are many ways in which companies routinely waste money. For example, companies – even midsize ones - fail to centralize purchases to be able to negotiate volume discounts. Spend analytics can identify opportunities to earn volume discounts and, once in place, create alerts if employees are deviating from policies or if the vendor misprices an item. Frequently, companies discover there is duplicate spending for all sorts of overhead items. In some areas like travel and entertainment, companies that have not fully automated requisition-to-pay as an end-to-end process may be spending too much or they wind up cutting back across the board, rather than focusing spending reductions in specific areas that are not as critical. When used properly, spend analytics also enables organizations to forecast cash flow more accurately because it updates future cash outflows at the moment spending is authorized (either on the creation of a purchase order or some other defined documents).

Spend analytics is like having a purchasing department robot at work 24 by 7 by 365. Purchasing spends most of its time focusing on big ticket items but it either does not control or cannot be effective enough in handling smaller, day-to-day purchases. Spend analytics enables companies to monitor the full breadth of purchases and provide alerts and guidance to achieve savings. Individually, these savings may be small but can easily add up to several percentage points of profit margin over the course of a year.

Spend analytics and spend management are used more in certain categories of outlays than others. Companies have both an internal spend – money most paid to employees and for facilities and equipment – and an external spend – monies paid out for everything else. Typically, spend analytics is not used to control internal spend. Organizations use all sorts of HR and compensation analytics and management tools to ensure that it is paying the right amount to employees in salaries and benefits. There also are plenty of benchmarks to guide companies in controlling their capital spending or leasing costs, as well as metrics that should give them a good idea if they are over- or under-spending on the property, plant and equipment categories.

As for controlling their external spend, these are classified in two categories. One is “direct spend” (also referred to as “strategic s

Infor: Future of Technology In Their Products

11/3/2009 4:12:49 PM

I recently attended Infor’s Virtual User Conference, which includes presentations on its future technology direction, both generally and in the financial software category (See: “Infor and Enterprise Applications: Did You Hear Their Tune?”). Bruce Gordon, the Chief Technology Officer, talked about Infor’s direction, which I think is following a business orientation. This reflects a major shift in business computing. The first half century of the computer age was about the development of technology. Technology innovation will still be important, but gains in the value business computing will be limited unless organizations find it much easier to utilize the technology capabilities that exist and are able to harness the data these systems with far less effort than is required today. I believe for this reason, Infor thinks its best approach is to have products that make it relatively easy for companies to automate their business processes, rather than having to adapt their business processes to technology constraints.

Bruce also described its technology direction conceptually in terms of what it will enable businesses to accomplish by using its software. Another aspect of “process centric” software is one which manages end-to-end processes (requisition-to-pay, recruit-to-retire or quote-to-cash, for example) rather than handling only the individual bits (creating a purchase order or processing an invoice). Because end-to-end processes requires interaction between people in executing the process, business applications must be collaborative. Since, in today’s business environment processes can extend upstream into suppliers or downstream into customers or channel partners, it’s critical to enable collaboration in executing processes or handling exceptions. Indeed, over the past two decades a major economic benefit of business software has been to reduce the need for middle managers to communicate and coordinate, with the result that in the United States businesses have flatter structures than they once did. As businesses put more end-to-end processes in place, it reduces the need for human coordination but it also requires automated supervision, which means software must enable more monitoring, alerting and risk management to enable organizations to manage by exception rather than by routine. Along the same lines, software must be “directive.” In other words, it should be anyone’s assistant, organizing and prioritizing what each individual should be doing.

Some of these concepts will be built out in the future, while some already exist today (albeit with plenty of room to expand), particularly in the company’s Performance Management applications (covered in Scott Lindsay’s presentation). Infor’s “My Day” is an attempt to organize information and processes according to business function and role as my colleague discussed from last year’s conference (See: “Infor Introduces a New Business Day with Infor MyDay”). There are 40 of these now but the company long-term plan is to have 150. More granular definitions are important, especially in small- to midsize companies because people typically divide their time between multiple roles. Infor “Decisions” extends this idea into function/role-specific analytical application packs for trends and analysis. All of this requires the ability to pull information from multiple systems and maintain these connections with least amount of effort to get more productivity from smaller IT departments. Scott also detailed the series of planned enhancements to the performance management products which involves increasing the amount of automation tools for planning, closing and reporting. There will be a continuing stream of ease of use enhancements (s

Infor and Enterprise Applications: Did You Hear Their Tune?

11/3/2009 4:05:31 PM

For most of the first half century of business computing, most of the advances in this field came from harnessing Moore’s Law and the expanding scope, depth and quality of the capabilities that ever more powerful hardware and software allowed. With the advent of the worldwide web in the mid-1990s, Metcalf’s Law (the value of networks expand geometrically with the number of people attached to them) kicked in as well. However, I think these will have a more limited impact over the next decade. Gains in the value business computing will be limited unless organizations find it much easier to utilize the technology capabilities that exist and are able to harness the data these systems with far less effort than is required today.

I was reminded of this listening to several of Infor’s Virtual User Conference keynotes and presentations on its future technology direction. Infor, a private company, has been a consolidator of business software companies, many of which focused on large and midsize companies manufacturing verticals (including Baan, SSA and Symix) as well as financial software (among others, Geac, Sun Systems and Extensity) and performance management applications (Comshare). Infor tends to get considerably less coverage in the technology and financial press than its some of its rivals (notably IBM, Microsoft, Oracle and SAP). I think this is partly because it is private but also because so many of its customers are midsize corporations.

This decade of consolidation in the software business was driven partly by financial markets, which in turn has reflected an important change in the enterprise software business model. In particular, the value of a software companies’ maintenance stream often has been worth more than the stock price but only if the acquirer was able to achieve efficiency in new license sales and marketing efficiency and reduced administrative overhead (which has not been at all difficult to achieve), and efficiency in ongoing development efforts to existing products that users felt justified their maintenance payments. This can be difficult but one important reason why maintenance payment streams have become more valuable – particularly in business applications – is that the pace of technology evolution in these products is slower. Consequently, the interval at which it makes sense to completely replace business software packages has lengthened and the longer maintenance “tail” is that much more valuable. For a large percentage of Infor’s midsize customers this has been a welcome evolution because they either do not have or do not want to spend money on the resources needed to do more frequent upgrades and changes.

Which brings me to comments made by Infor’s CEO Jim Schaper in his opening keynote. Infor’s go-to-market approach is heavily weighted to customer retention which translates to making it easier for existing users to find value in doing business with Infor. My analysis of Infor’s market strategy is to target those companies that exhibit “late majority” or “laggard” buyer behavior; that is (ditching the pejorative connotations of those terms), a very conservative or dismissive approach to using information technology in their business. Although among technology folks this behavior model usually is associated with Geoffrey Moore’s Crossing the Chasm, this buyer profile had been used for decades for all sorts of products. While Moore was focusing on patterns of technology adoption, these major business software categories are already well adopted, which is why it’s important for a software company to understand its customers.

In its attempt to retain customers and even extend its presence to include, say, performance management applications from a manufacturing applications base, Infor is focusing on making its software (relatively) simple to deploy and offering fixed price implementation options. This de

SAP Promotes Value of EPM and GRC at SAP Reporting Conference

11/3/2009 12:15:27 AM

I visited the SAP Reporting and Analytics 2009 conference in Las Vegas to hear what SAP might be discussing about the latest in SAP business intelligence (BI).

At first I was a little confused as the conference this year was combined with SAP Projects conference which provided the first keynote by Jason Fox who leads the national competence center for SAP. Though the history and evolution of applications from SAP to SAP Business Suite 7 was not relevant for me who already knows the company history since early 90’s and I doubt for others too. There were a couple too many apologies for the woes of the past by SAP in issues regarding upgrades, implementation cycles and challenges in timely deployment of applications. All of this discussion led to a sales pitch on SAP Business 7 and how SAP best practices education and value scenario assessments can provide better tools for upgrading and expanding applications deployments across the enterprise. All of this came as I got alerts on the third quarter 2009 results of SAP where application software revenue has been declining continuously over the last year.

But what is growing and of more interest to organizations today? Well the need to get information from our applications like SAP and provide it to business in different forms. The first being reporting where access to routine information is needed by business and the second being analytics where information needs to be further analyzed through different means. Now while the conference was busy bringing education on these topics the opportunity to advance what organizations need to strategically do with information was part of the main keynote by VP Marketing of SAP EPM and GRC, Stephanie Buscemi who is one of the authors of (“Drive to Perform: Risk-Aware Performance Management from Strategy Through Execution”).

Stephanie took the stage and provided clarity to the changes in the industry where the pressure to not just perform but address risks as part of management and business processes as well as operate under any level of compliance. Of course these are part of the main theme of the keynote presentation on EPM and GRC where they provide significant value to business and clarity on GRC that is much needed (See: “IT Analyst Firms Continue Confusion on GRC”). There were some interesting facts from recent research into companies using SAP as top priorities in using business critical key performance indicators, improved user experience and need for reporting across business. Some additional research presented by McKinsey indicated priority on risk and performance management as places for short term gains from technology which of course played well with Stephanie keynote. Some pragmatic discussion on the pending transition of companies reporting requirements from GAAP to IFRS as my colleague has eloquently discussed (See: “IFRS and IT Choices: Are You Planning?”) and the need to further examine how to have the right financial reporting systems integrated with the closing process helped many start to understand transition required in coming years.

Most important to many was a relevant discussion with committed customers using SAP from Kevin Walker at BYU who uses SAP BusinessObjects suite of products to help with financial close process that is dynamically available next day. BYU now supports over 3300 users and has reduced 17 FTE from team through automation of their BI technologies. The second organization was Coca-Cola enterprises who have been a long time customer of SAP who also uses the SAP suite of BI products includ

IFRS and IT Choices: Are You Planning?

10/30/2009 8:42:51 AM

The run-up to the adoption of International Financial Reporting Standards (IFRS) in the United States will give financial executives an opportunity to improve the effectiveness and efficiency of their organization because, as part of the transition, many will need to make some fundamental choices about the IT systems they use to support their operations. These include the ERP/accounting systems and the software they use to perform their statutory consolidations. The question is – will they take advantage of the opportunity? Probably not – if history is any guide.

The introduction of IFRS will not necessarily require companies to buy new software, but some companies will find replacing some software, consolidating their vendor base (larger companies typically have ERP software from multiple vendors) and adding some financial data management capabilities (such as master data management) will be cost effective moves. Since even without the change in accounting standard these might be a good idea within the next 3-4 years, and because the phase-in for US companies will begin within this period I think corporations ought to have a long-term IT capital spending plan that factors in the requirements for IFRS. For most companies, this is likely to be a departure from the year-to-year approach they now use. CFOs and other financial executives are loath to replace their accounting systems because it is akin to having a root canal procedure: potentially painful and always expensive. With the shift to IFRS, companies will benefit from sorting out how changes in their accounting environment can best be handled by their IT systems. The point is – it’s a lot easier to envision a better (if not optimal) finance IT infrastructure for IFRS and then gradually implement it over the next several years than to make a series of ad hoc decisions that may only accidently turn out to be the right choice.

Yet, it’s hard to be optimistic that many (let along most) finance departments will take this path. A majority of companies dragged their heels in confronting the demands of Y2K and the Sarbanes-Oxley Act. Yet despite these still-fresh memories, current polls of US-based corporations indicate only a relative handful have started their migration to IFRS and only a few more plans to start in the near future. For US public companies with 1,000 or more employees, further delay in starting to plan both the accounting and IT ramifications of the shift to IFRS would be an expensive mistake.

Complicating all of the IT decisions is the reality that different companies will have very different needs depending on their existing infrastructure and – crucially – how their accounting processes will change in the switch from US-GAAP.

Finance executives that are looking at the accounting treatment implications of the switch may not be asking the necessary, parallel questions as to how best to support these changes with their IT systems. The shift from a rules-based standard (US-GAAP) will put a premium on having high-level financial controls in order to cut down on the amount of external and internal auditing that will happen when a principles-based system (IFRS) collides with manual processes. For example, only about half of the companies we benchmarked had automated at least some their order-to-cash or requisition-to-pay processes. However, this sort of automation makes it far easier to ensure that accounting treatments consistently follow acceptable principles, especially in the “downstream” accounting processes that take place during the close and the close-to-report phases of the accounting cycle.

Finance executives ought to manage the shift to IFRS as a multi-year project. There are things that need to be done this year, the next, the foll

IBM Mashes Information and Analytics to Support Information Accessibility

10/29/2009 11:01:42 PM

IBM announced at IBM Information on Demand conference a new version of IBM Mashup Center that will simplify the assembly and publishing of information across a workforce and across the Internet for consumers, constituents and customers. This IBM Software wide product that is designed to enable business and IT to work together in the harvesting of information across the enterprise including content, documents, reports and integrate capabilities that can help individuals interact with the information but also information and services across the Internet. The growing volumes of information in organizations is not easily leveraged into business efficiently can be integrated easily for use across applications.

This technology directly aligns into what I call ‘information applications’ and is a new generation of technology (See: “Information Applications: New Generation of Information Technologies”) that unifies accessibility and action to all information including content and data in a range of channels including mobile, voice, web that can be easily accessed by consumers to employees through self-service and simple methods to search, retrieve and act on information. Most importantly this technology is all about the needs of individuals to get access to information (“Information Applications: New Focus on Information Availability“). The IBM Mashup Center helps address these requirements quite readily and also helps harvest the analytics that have been built for strategic and operational purposes.

The IBM Mashup Center uses the IBM iWidget framework that provides a common technology wrapper around sources of information and capabilities that can be easily managed in a library where they can be shared and used for a wide range of needs. These iWidgets can be integrated together into composite widgets and can be easily assembled without programming or traditional application development cycles. The iWidget is a standard framework that is being published by a wide range of IBM specific software that can make it simple to bring together information from a range of products like IBM Cognos products. In fact IBM Mashup Center tightly integrates with IBM Cognos 8 Mashup Service where the range of reports, charts and other analytics can be directly available and published for consumption in IBM Mashup Center. IBM Cognos initially released the interfaces for this at the beginning of 2009 with the release of IBM Cognos 8 version 4 and part of what I wrote about in recent analysis of IBM BI and analytics efforts (See: "IBM Fuses New Generation of Analytics for Deeper Business Optimization").

I spent some time to review IBM Mashup Center and capabilities at the conference to see how it operates and where it can be truly used by business and not just IT. The product definitely is simple to use and can be a much simpler method to get information out than most enterprise portals. IBM WebSphere Portal Server though is a more robust environment with deeper set of capabilities in regards to customization and development capabilities and is a deeper choice for many that are looking for a centralized methods to provide applications and services in an integrated framework compared to just making information available.

IBM still has some work to accomp

Nexidia Launches First Real-time Speech Analytics

10/29/2009 2:47:15 PM

All of a sudden speech analytics has become a very hot topic (See: “Does Your Customer Voice Matter”), and Nexidia has just made the space red-hot with the release of its latest product. This takes the company into the realms of real-time speech capture and analytics, and has enabled it to offer a unique pre-built application.

Nexidia and other companies such as Envision, Nice Systems, Verint and VPI have been in the speech analytic market for awhile now. But my research into customer experience management shows that to-date there has been quite low levels of success with market penetration at very low levels (less than 15%). I think this is attributable to several things, not the least: lack of understanding of what speech analytics can do for a company, a fear it is too complicated to implement, and of course price. A combination of its two latest products Nexidia ESI-Capture and ESI-Monitor go an awful long way to overcome all these issues and go beyond what I have already written about Nexidia (See: “Understand the Actual Voice of Your Customers with Nexidia”)

ESI-Capture acts like a call logger, but in a more sophisticated way. It sits in the network and literally captures speech data in real time. The data is passed to ESI-Monitor which uses the power of the core Nexidia phonetic speech analysis engine to identify what the caller is saying. Companies can configure the product so it recognises words and phrases, or combinations, and can extract these records. For example a company might define a customer at risk category as any calls that contain the phrases “I want to close my account”, or “I am I thinking of going to a competitor”, or “I am unhappy with....”. Any calls contain these phrases (which can also be connected by a time element) can be put into a bucket which is then analysed and reported on. The benefit for companies is that they get to see what customers are saying, and they see this by category. The products run on commonly available platforms, can handle quite high volumes of calls on a single server and from the demonstration I saw, are easy to configure.

But the good news doesn’t stop there. Nexidia have pre-built an application, Agent Assist, that based on the real-time analysis can kick-off an event. For example, using the scenario I used above, the system can be configured to pop a message onto the agents desktop to warn the agent that the caller is a risk and this is the action they should take. This was found to be essential in our benchmark research on Customer Experience Management to ensure that agents are dealing with customer interactions as effectively as possible. This takes Nexidia into another growing application area, the smart desktop. These applications, from vendors such as Cincom, eglue, OpenSpan and Salesforce.com not only help agents navigate through complex call responses and information access but actually pop recommended actions onto the agents desktop. This brings several other benefits to a company, such as reducing average call handling times, increasing first call resolution rates, and driving improved up-sell opportunities.

All this said, I still think many organizations need to advance their process and technology competencies and maturity with speech analytics but these new developments from Nexidia do address many of the issues companies have so I won’t be surprised to see adoption rates climbing quite considerably.

Regards

IBM Fuses New Generation of Analytics for Deeper Business Optimization

10/28/2009 4:38:35 AM

IBM general manager of analytics and performance management Rob Ashe keynoted and provided deeper focus on the advancing set of technology and solutions for business at IBM Information on Demand conference. This builds on a larger agenda of IBM on information led business efforts (See: “IBM Doubles Down Again on Information Agenda at Annual Conference”) and significant news building on the recent dedicated IBM Cognos conference in May (See: “IBM and Cognos Software – Advancement but No News at Forum”). Of course the IBM recent acquisition of predictive analytics provider SPSS (See: “IBM Boldly Elevates Analytics with Acquisition of SPSS”) expands the BI and Performance Management portfolio significantly. Rob spoke to advance the need to predict and act, and need for real time and fact driven efforts for optimizing a range of business and process efforts. Rob is not new to this business and technology discussion as his 25 plus year experience in this specific industry provides him the ability to have a much deeper discussion than most in the industry and IBM who needed depth to provide confidence and trust in their efforts. IBM Cognos has brought IBM into new opportunities in the market with a unified platform, tools and suite of applications that compliments and extends value of their information agenda to a business one where it was not possible before.

The analytics discussion expanded further with the newly assigned leader Deepak Advani as VP Predictive Analytics and has been at IBM since 1992 though new to this software segment. Deepak is leading the SPSS team and their products into the IBM portfolio to ensure they get maximum value. Interesting that current executives from SPSS were not part of IBM’s conference or appear to be part of the new leadership team which might be good considering SPSS 40 years of history that might have been getting in the way of advancing their own business. IBM is clearly serious about this acquisition and is beginning to see the value of their technology that is not just predictive analytics and data mining but also text analytics and technology to support customer experience and related analytics (See: “IBM Will Discover Analytics for Customer Experience Management in SPSS”). SPSS can already deploy analytic models that can operate within IBM DB2 and other technologies that will be critical to embed analytics where they are needed. This clearly has much more potential that IBM retired data mining efforts with Intelligent Minder that were discontinued many years ago and were also ahead of the business demand and intellect of most organizations.

IBM reviewed the generally available Cognos 8 version four that brings new usability and business enablement of products from search, location, mobility, charting and annotations to make it more line of business user friendly and assessed as part of early review. (See: “Summit Reveals New Advancements from Cognos in Performance Management”). They also have rationalized the use of TM1 64 bit multidimensional server and its executive information viewer with limited Cognos 8 version 4 release as part of new IBM Cognos Express mid-market offering (See: “IBM Cognos Express Aims to Simplify Midmarket BI”) that is a major focus for them. A demo of Cognos 8 version 4 software provided focus on the needs of business users and analysts who need better capabilities than just using personal spreadsheets. IB

IBM Executive Steve Mills Outlines Value of Software for Smarter Planet

10/28/2009 4:21:26 AM

The head of IBM Software, Steve Mills the senior vice president and group executive outlined at the annual IBM Information on Demand conference the state of the business environment and citizenship reality that are faced upon everyone from the impact of globalization and sustainability. The IBM focus on the theme of ‘smarter planet’ brings to practical reality the legacy and also stupidity of how our planet has evolved and operates with inefficiency that is now part of our daily lives. This discussion brings to life what now is the responsibility of our business and government leaders to not debate but create concrete solutions for smarter continuity of how we live every day. There is no doubt as Steve outlined the changes in the world that have resulted in becoming more instrumented and interconnected that we definitely need better intelligence for how we operate. The digital revolution has created what I call information anarchy or IBM nicely says the information explosion. In either path this needs to be addressed with information technology that should be a heck of a lot smarter for all of us.

Steve introduced a range of very specific activities that innovative companies have taken to use technology and of course from IBM to build smarter organizations. IBM presented what is possible with ‘Smarter Manufacturing’ and work at AirBus using RFID and SOA to advance the information flow across the manufacturing process. IBM efforts to build ‘Smarter Cities’ where Alameda County, CA helped instrumented a more streamlined effort in human services to administer programs and funding. ‘Smarter Public Safety’ at New York Police Department for crime data systems to understand criminals and action required to respond and act upon it. ‘Smarter Education’ with Hamilton Country using predictive analytics for improving education potential across schools and yes ‘Smarter Energy’ with DONG where remote monitoring and control devices are essential in energy processing in northern Europe. The examples were tirelessly presented across industries and were clearly intended to help energize other companies in the same industry and others to see what is possible if you think outside of the conventional wisdom of what most are doing in business and IT today.

At the press and analyst conference, I got a more personal perspective from the IBM leader of the $24 billion software company who has the natural ease to discuss the widest range of business and technology unlike any other technology executive in the industry. Steve has been working and delivered one of the largest software portfolio expansions and investments in the industry focused on a mission of transforming how organizations operate using information and computing power. I have been to every IBM Information on Demand conference where initially it was mostly IBM DB2 and related tools but now has blossomed into a diverse but interconnected portfolio ranging from information management technologies, content management, business process management, analytics, business intelligence and performance management that now is really about IBM sales and services executing and marketing to simplify how it is communicated.

While many of would like to have seen some rebuttal from Steve or dispute to jabs by Oracle in recent weeks, this is not their style. IBM is focused on their mission, and I would personally say if they are actually not the cheapest and fastest in specific technology segments, they are focused on the customer and their solutions to meet their needs. There is nothing wrong with being maniacally focused on the customer and if IBM is bringing a ‘Smarter Planet’ approach, well it will be up to CEO, CFO, CIO and other technology buyers to determine who and where they make those investments. IBM has clearly been doing quite well in a challenging global environment and inve

IBM Doubles Down Again on Information Agenda at Annual Conference

10/27/2009 5:52:57 AM

At IBM Information on Demand (IOD) in Las Vegas the conference started today to introduce the latest insight to the fastest growing components of their business with analytics they have announced. IBM has invested over $12 billion in expanding their portfolio and organic development of their own technology. IBM General Manager of Analytics and Optimization Ambuj Goyal started the conference keynote discussing the expansion of focus on information management and range of acquisitions that have driven their expansion in the software. Interesting that previous years strategic partners like Cognos, FileNet and recent acquisition of SPSS (See: “IBM Boldly Elevates Analytics with Acquisition of SPSS”) are now part of IBM enterprise software efforts. IBM has made significant advancement from last year where they provided the vision for what they call the information led business (See: “The IBM Frenzy on Information Agenda for IT and Business”).

The keynote was transitioned to Frank Kern the SVP of IBM Global Business Services who leads the consulting services organization and recently announced business analytics and optimization consulting group reporting to him. This new group has been active for seven months with over four thousand consultants driving services engagements with organizations worldwide. IBM has opened new competence centers to energize these business analytics and optimization efforts in: Berlin, Germany; Beijing, China; New York City, NY; Tokyo, Japan; along with new ones to open in Washington, DC; and London, England to help work more closely with organizations. This commitment to consulting services on analytics and range of information management, business intelligence and performance management comes at a market inflection point when many consulting firms have consolidated and down-sized their organizations but IBM is now ready to address needs as the business begins to invest into this segment even further.

Frank provided some research statistics at IBM states that one in three frequently make decisions from information they don’t trust and one in two say they do not have access information they need for their jobs. But this should be no surprise as our benchmark research in data governance and decision making and performance has indicated even worse environment of a situation that trust is not the issue but the level of errors from decisions using inaccurate data. Our research also has founded a vast disconnect between business analysts and management who spend significant time on spreadsheets, presentations and email that operate virally as the tools for analytics and decision making. I did not see a conversation from IBM on how they can help lead this transformation of more accurate and consistent information and onto dedicated systems across business and IT that is simple and easy to accomplish.

A keynote panel discussion across IBM customers Blue Cross Blue Shield, Chevron and Elie Tahari state their further investment into data and analytics for supporting their specific needs. I have a little insight into some of these organizations who have business and IT collaboration challenges on addressing the business needs and have their workforce using personal spreadsheets, presentations and electronic mail along with the most valuable keystrokes in business being CTRL C and CTRL V to get data from reports and dashboards into their personal spreadsheet playground. The challenge of embracing and integrating spreadsheets into an enterprise environment is one of the largest issues

Salesforce.com Brings Social Media to Customer Service

10/23/2009 7:17:10 AM

Anyone in the contact center or customer service space can’t help but notice that the big thing of the moment is what impact will social media have on customer service. This point was very much in evidence at the European launch of salesforce.com Service Cloud 2 that I attended this week. My colleague covered some of the basics of the announcements (See: “Salesforce.com Advances Customer Service in the Clouds”) and my review at the recent Call Center and Customer Management 2009 conference but I want to expand on the social media capabilities of Service Cloud 2.

The proliferation of people using social media sites like Facebook, Twitter, YouTube and more business oriented sites like LinkedIn, both for personal and business reasons, has driven lots of vendors to see how they can integrate these sites into their contact center and customer service solutions. This advancement of social media with business was one of the business technology priorities in 2009 (See: “Business Collaboration and Networking – Priority for 2009”). The theory, and indeed practise, says that when people have a problem, as they become increasing frustrated by poor customer service from their suppliers, instead of calling the contact center or trying to use web-based self-service they go into Google and search for an answer. People more tuned into social media channels take this one step further and ask their friends, or indeed the world, whether anyone else out there has the same problem and whether they have a solution. By polling this wider base of knowledge, many find they indeed get the answer quicker than by contacting their original supplier. This of course changes the whole face of customer service.

With the launch of Service Cloud 2 salesforce.com has gone one step further than my last analysis (See: “salesforce.com brings New Cloud Computing Ecosystem to Europe and Internet”) and now allows companies to integrate social media sources into their end-to-end customer service processes. In simple terms, Service Cloud 2, brings all of a customer’s interactions into a single desktop that service agents can quickly access to help determine a solution to a caller’s query. This can include calls, e-mails, chat sessions, outputs from a customer portal, and text-based messages from social media sites. These and other data sources from systems such as ERP and CRM, are integrated in a knowledge base, and presented back to agents at the click of a mouse.

Service Cloud 2 takes this one step further. Having brought all these sources into a common knowledge base the information can be repurposed to support other channels of customer communication. For example a tweet can easily been turned into a knowledge item used to provide support on a customer portal, a tweet can be responded to by a company initiated tweet, email or outbound call, a tweet can be shared with partners and supplier; the combinations are pretty much endless. All of this is in the cloud so comes with all the normal benefits of cloud-based solutions.

These features set Salesforce apart but they will also need to look where to partner with other vendors that I have assessed such as Attensity, Overtone and Time for Increased Automation of Enterprise Risk Management” and “Manage Risk across Enterprise Effectively”).
The purely mathematical aspects of ERM are straightforward: the basic modeling techniques are well established . The more problematic aspect of managing risk in organizations is the human element – getting people to identify the risks they face, assessing their probability and impact, and determining the scale used in measuring the impact of the risk. To do the last two, you first must have a way to get people to share their assessment of risk in ways that reliably surface the most important risks in a way that encourages participation and does not penalize honesty. Technology and the rising acceptance and use of social media have made this easier.

Today, companies are starting to use new techniques such as prediction markets and crowdsourcing to help address enterprise risk.

Like the Air Force, any midsize or larger company is often at risk because those in charge do not have a way of comprehensively monitoring and managing the risks a company faces. The impact is multiplied because individual managers have no idea which of the risks of others could have a significant impact on their own part of the operation. Even if some of the risks are discussed from time to time in review meetings, it doesn’t mean that the organization has anything more than a vague sense of which are the most important. They don’t have a clear sense of the likelihood of them materializing, or the degree and nature of impact(s) they might have. As a result, executives and managers are unaware of what they should be looking for and cannot set priorities for managing risks. Worse, the consequences of some of the risks might ripple out with unforeseen (but foreseeable) consequences. What might appear to be moderately probable but seemingly low-cost impact (the failure of a low-cost component to pass thermal tests) could result in the delay of a critical subassembly and the need to spend a considerable amount of money dealing with this contingency. Unless the risks are networked, managers will not understand cross functional and interconnected risks.

“Prediction market” is a relatively new word used for a speculative market created for the purpose of making predictions about elections or economic events (company earnings, for instance). Prediction markets were inspired by British bookmakers handicapping election results and their apparent ability to accurately predict results more often than not (and more

Cybertech International Advances Into Contact Center Market

10/22/2009 5:20:13 AM

Cybertech International isn’t a vendor that I was familiar with until I visited their stand at Contact Center Expo in Birmingham UK a few weeks ago where I provided analysis on other announcements (See: Call Centre and Customer Management Expo Highlights Cloud Computing) . Since then I have learned it is a well established brand in the international financial service market with its call recording product. This enables financial services, and other companies to record customer calls to meet regulatory requirements. The product is a fully functional system the supports the secure recording of calls from either traditional telephony or VoIP-based networks, and has the additional advantage that it runs on standard computer hardware and software platforms. This make it highly flexible so that it can be configured to record calls in single or multi-site locations, and users can also configure it to record all calls or only those that they select. The system is scalable and can record from thousands of channels simultaneously.

With this track record, Cybertech has identified the contact center as a primary target market. My benchmark research (See: Agent Performance Management) into shows that even with such a good track record, Cybertech could well struggle in this market as it is already quite over crowded with other vendors such as Envision, Knoahsoft, LiveOps, Nice Systems, Verint and Voice Print International, and penetration rates are also very high. Therefore, very sensibly in my opinion, it has decided to expand its product portfolio into areas closely associated with call recording. It has therefore launched initial versions of an agent quality monitoring system and can also now include the capture of agent screen usage. My research show these are both critical systems needed by contact center managers to monitor and assess the performance of their agents. The current versions are quite basic but upgraded versions are planned for release during early 2010.

The very latest announcement sees it partnering with Callminer in the UK market to add speech analytics to the portfolio. Speech analytics has become one of those hot topics as vendors try and persuade companies this is the very latest way to undercover the “voice of the customer”. I totally support their argument (“Are Your Customer Metrics and Business Intelligence Good Enough”) as companies typically have thousands of recorded calls which they make very little use of, even though embedded in them is a very clear picture of their customers’ issues. Speech analytics allows companies to gain these insights and the smart ones use these insights to address a wide range of both back and front office issues. So again it seems like a smart move by Cybertech and it will be interesting to watch how it develops these additional products and partnerships.

Let me know your thoughts or come and collaborate with me on Facebook, LinkedIn and Twitter.

Reg

How is Your Enterprise Data Warehouse for Finance?

10/21/2009 5:49:06 AM

Attending the Teradata Partners Conference in Washington DC this week I was reminded of one of the more vexing but unseen issues facing finance departments – the difficulty of pulling together data from disparate sources for management analysis and reporting, external reporting and tax. Too many corporations seem to ignore (or under employ) the techniques developed over the past fifteen years to assemble and make accurate, consistent and timely data available without forcing analysts and others to jump through hoops getting the numbers together. One piece of this solution is the enterprise data warehouse for finance (EDWF). There are three main applications for this sort of “EDWF:” management reporting and analytics, external reporting and tax.

One thing our benchmark research consistently finds is that systems complexity is an issue for a majority of larger companies (those with 1,000 or more employees), making it difficult for them to perform a wide range of tasks that require the fusion of multiple data sources for alerting, analysis or performance assessment. A majority of very large corporations (5,000 or more employees) have general ledgers from multiple vendors and even when they use a single vendor’s product, they have multiple disparate instances (different general ledger structures). Some have advocated “best practice” as having a single instance running on a single vendor’s system. For many types of businesses this may be impractical because it’s not cost effective to uproot existing software to implement a single system, or because the company is in businesses that demand fundamentally different account structures. Those structures are meaningful at the business unit level and are appropriate for that portion of the business’s alerting, analysis and reporting. Although some companies have accounting as a centralized shared service across multiple business units, others are decentralized. All of this concerns just the accounting data. Increasingly, management reports (and even some statutory reporting) increasingly require operating data from sales force automation/customer relationship management systems, maintenance repair and overhaul, real estate management, warehouse management, supply chain management systems and so on. (See “Do You Have Integrated Business Reporting Yet?") Data also can reside in multiple repositories such as Hyperion “cubes” that are not readily accessible by a finance department’s other analytical systems creating a financial information management dilemma (See: Information Management for Finance Benchmark).

Rather than having a single source to pull data from so that data and analysis can be assembled quickly and consistently, companies typically lash together management reports from multiple systems and waste considerable time doing so. An EDWF would provide these organizations with a solution that can free up considerable amount of time to do more strategic analyses or free up resources for other purposes.

Ideally, companies would do their management and external reporting as parallel activities rather than trying to get a system to do them in an interlaced fashion. What a company needs to show executives and managers to enable them to run the business effectively is only accidently related to how it reports its results to shareholders. Trying to execute these two different processes in anything other than a parallel process wastes time and needlessly delays getting information to managers. Moreover, in the United States, the requirement to provide information in an interactive form (tagging financial tables and footnotes with XBRL) will place time burdens on them in the close-to-report phase of the accounting cycle. In order to do the tagging and meet deadlines comfortably, company should eliminate the fa

Attensity Listening to Social Media World

10/20/2009 1:38:40 PM

If anyone is in any doubt the way people communicate with each other and with companies has changed dramatically (see “Unlock Customer Voice through Text Analytics”). People used to write letters, and then the phone came along. People used to call each other then the mobile phone came along and everyone started texting each other. People used to use the Internet to search for information and now they use it to chat with friends and companies. And now Twitter, Facebook, LinkedIn and other social media sites are here and people use them to chat with friends and companies. And now with smart mobile devices, people do all of this, all of the time no matter where they are – so we have indeed entered the “social world” where lots of people have transitioned to using text-based communication to stay in touch, find information and what is going on, and complain.

All of this plays to the core strengths of Attensity, with their text analytics technologies designed to help you with understanding the voice of your customers in their main product Voice of the Customer 5. This allows companies to collect all of these text-based communications – of which there are many, many thousands – and finally make sense of their content. In the “good old days” companies could only do this by reading the communications and individuals then analysing the content. The Attensity products allow companies to automate this process, and thus gain the benefit of saving time and effort identifying common issues being raised by customers and prospects. The products can do the simple things like spotting key words and phrases but by using sophisticated analysis techniques, they can put words into context, identify underlying sentiments (“I intend to go to a competitor”), and do trend analysis. This information can be shown in various forms of reports and graphics, enabling companies to identify where they need to take action, and indeed what action to take. This is essential for business today and was found to be a growing demand in my benchmark on Customer Experience Management.

With its latest developments, Attensity has stepped into this social world by enabling companies to capture what customers are saying about them on social media sites through recently announced Attensity Cloud. Powered by a company and product called Radian6 and its social media technology, it enables companies to extract the text-based messages customers are writing about them on designated social media sites. The contextual capabilities mean that companies only see messages that relate to them, and then the full power of the analytics provides the same insights that can be gained from any other text-based interactions.

However knowing what customers are saying is not really enough (See: “Customer Analytics – Use Them or Lose Them (customers)“) . So the product allows companies to integrate the information with information extracted from other systems such as CRM and ERP and then based on rules decide the best way to respond. For example the information, and a suggested action, can be sent to a contact center agent to respond , or the information could be used to create a company initiated tweet, or it could be stored in a knowledge base to support similar requests being entered on a self-help web sites.
In an innovative move, to demonstrate the

Teradata Steps Up Version 13 into Cloud Computing and New Appliance

10/20/2009 7:10:30 AM

Steering committee president of Teradata Partners User Group, James Volmer took stage with a Chevrolet Camaro crashing through the backdrop of the stage to grab everyone’s attention and kick off the annual conference A highlight on his company Enterprise Rental Car where they have streamlined their interactions with insurance and repair providers using a common application called ARM using a data mart solution. But the baton was passed to president and CEO of Teradata, Mike Koehler. He discussed how Teradata was fairing in a challenging economy. Discussing that BI is still a top priority in organizations which we know is an intention and not representative of the top spend or percentage growth on spend (See: BI is Not a CIO Technology Priority Yet!). Mike emphasized the importance of an integrated approach to data warehousing compared to silos and reduction of costs which is pretty obvious to many but not how organizations have been taking on new analytic data mart solutions. While Mike discussed the importance of TCO there was not a definitive formula or reference for customers or comparison to other providers. I have seen how TCO (See: Does TCO Matter Anymore?) is still not well used by CIO and IT, and not sure how IT can do effective budgeting (See: Mastering the Art of IT Budgeting) without it.

Sidestepping the data warehouse ruckus and competitive shots at Oracle OpenWorld last week (See: Larry Ellison Stumps Oracle Exadata and Fusion Applications with California Governor) with their re-energized data warehousing efforts, Mike did briefly discuss Teradata with version 13 now available that provides new series of advancements in performance and scalability along with how it is available in appliances and cloud computing and what it can now do for your organization. The highlight of the event was their discussion of their new appliance they call ‘Teradata Extreme Performance Appliance’ for active data warehousing which uses enterprise solid state drive (SSD) instead of traditional mechanical drives. This appliance model 4555 will be available in early 2010 and is designed to handle up to couple hundred terabytes. Though they did not provide details on computing power to compare against others it is going to bring a new advancement in storage that they announced last year. Teradata has postured that this appliance and approach will even be more effective than using alternative approaches like complex event processing (CEP) which is not clear since that approach provides a more detailed level of granularity in events and ability to dynamically monitor and act on real time processing in organizations. But the benefits of enabling Operational Intelligence was clear in our recent benchmark research where the real time processing of more than a dozen sources and the ability to provide insight and capabilities to take action on risk, fraud, performance, processes are important but also the integration of data warehouses for historical reference and for caching/staging events for further processing.

Most interesting was that Teradata also announced their advancement into cloud computing called Teradata Enterprise Analytics Cloud providing a range of options for organizations to use the database technology in what is called Teradata Express will be availab

Immature Planning Processes on Display at Oracle Open World

10/15/2009 5:07:33 PM

When it comes to planning and budgeting, the gap between what’s possible and what companies actually do is still wide. Spreadsheets, still widely used for budgeting as well as other aspects of corporate planning (sales, operations, HR and so on)   are a major reason for the gap because of their well known (but largely ignored) defects. However, the issue is not just desktop spreadsheets. Even companies that have purchased dedicated applications keep their immature planning processes – they just automate these to make them less painful to execute.

Judging by the company success stories at Oracle Open World, there are a handful of companies that have achieved high levels of maturity in their planning activities, but a persistently large number are still at the first stages of their evolution. Our most recent “Integrated Business Planning” benchmark finds that about two thirds of large and midsize corporations are the bottom half the maturity distribution. While technology can be a constraint, process design, expectations and vision are also at fault. Companies – especially finance departments – continue to confuse budgeting with planning. Hyperion Integrated Operational Planning has been on display at Oracle World. Essentially it’s the old Interlace sales and operations planning (S&OP) product married to Hyperion Planning. Although Oracle/Hyperion is using the term “IBP” for this integration, we do not view the combination of budgeting and S&OP as IBP. This isn’t a knock on the product, which we think is a great first step in helping finance departments make the transition from just budgeting to more accurate and agile planning. Having the integration between S&OP and the financial plan in place is important because finance departments do not have a real, integrated view of the operational plan with the budget. When factor prices or demand drivers change rapidly, it’s impossible for the finance department to understand the real impact on volumes. Similarly, when conditions change significantly (as they have been repeatedly over the past three years) people in operations have only a faint idea of the impact of these changes on profitability since the models they use can only deal with incremental changes.

Having the right technology for planning (not just budgeting) is the first, critical step for most companies. Today, practical, affordable systems that are capable of speeding and streamlining the planning, budgeting, forecasting, reviewing and reporting processes are available for mega corporations all the way to midsize companies (100 employees or more). However, the right software is only the first step. Companies need to change their processes to include driver-based planning, rolling quarters planning (not just a simple, high level forecast) that integrates all facets of the business including finance, operations, sales, marketing and HR.

Let me know your thoughts or come and collaborate with me on Facebook, LinkedIn and IFRS: Assembly Required”).

There are several basic problems companies have faced for years when it comes to the close-to-report cycle. One is data integration. Not all of the data that goes into their filings comes out of their financial consolidation system. Some of it is kept in other enterprise systems or desktop spreadsheets (either on individual computers or a secure server). There also is the need to handle the integration of data from multiple systems in a consistent, automated fashion. (See “CFOs Need Better Financial Information Management”) Then there is the fact that some of the numbers in the tables in an external filing are referenced in the text along with calculations and ratios based on these numbers (such as percentage change or a measure of balance sheet strength). It is critical that these numbers are accurate and tie to the tabular information. Third, assembling and reviewing the text is often not the job of a single person so assembling these bits and pieces pose basic document management issues such as version control and approvals.

Manual systems for handling the close-to-report cycle are far more time consuming in creating and editing the content. And because they are error-prone, they require hours of checking and re-checking by very highly paid individuals. Then there is the mandate just imposed by the SEC (and existing in other countries) to report data in an interactive format; that is, using XBRL to enable investors to be able to work more effectively and easily with the financial data. By the time the third year of the interactive data phase-in kicks in, companies will have a large amount of discrete pieces of data in their financial statements to tag. Add to that the shift to IFRS from US GAAP which is scheduled to take place sometime in the mid-‘teens. Being principals based, IFRS will require greater amounts of commentary on the rationale behind accounting treatments. Creating, updating

Larry Ellison Stumps Oracle Exadata and Fusion Applications with California Governor

10/14/2009 11:33:23 PM

The infamous Larry Ellison did his annual mid-week keynote at Oracle OpenWorld where he delivered his personal passion for new Oracle technology advancements that went beyond his Sunday night appearance with Scott McNealy from Sun Microsystems (See: “Oracle OpenWorld Sunday Night Opener Highlights Technology Game”) and the Monday opening keynote (See:”Oracle Opens OpenWorld with the Charles and Safra Show“). In this year’s keynote he briefly discussed Linux and their efforts to drive neutrality in operating systems though they will potential own Sun Solaris and open source version of Solaris by their acquisition of Sun Microsystems.

Then in a frontal assault on IBM and others with database technology running on hardware other Sun and with appliances, Larry pushed his agenda on Oracle Exadata Version 2 for OLTP and data warehousing which is based on Linux. This is a fine line as we all know since Dell and HP are longstanding partners who also have integrated Oracle into pre-integrated appliances. Interesting was the continuous rhetoric about why Oracle is better than IBM and his claim that they are 16 times faster and configurations are a quarter of IBM’s prices. Larry said that IBM has filed a complaint about these inaccuracies and claims it is only 6 times faster which Larry admitted could be true but is still much cheaper. I am sure we will hear more from IBM about this point. Larry claims the versatility of supporting OLTP and data warehousing along with it being faster, better and greener than IBM and others like Netezza and Teradata respond. He pitched Oracle Exadata has better fault tolerance and capacity with the integration of memory from DRAM and flash cache memory along with hybrid columnar compression. An emphasis on how the compression can handle query processing faster with flash memory supporting a compressed 50 terabyte database in sub-second response time. His position is that Oracle Exadata drastically simplifies deployments as they are pre-configured and is ready on day one and price starts at $110k for basics then to $1m for a full rack. So now you have to talk to your peers who have deployed it to see if it is truly the fastest data warehousing & OLTP performance compared to others including what Larry calls ‘exotic specialists’. Larry put down a $10 million challenge that Sun runs Oracle faster than IBM and any company including IBM is able to enter the contest.

Larry then introduced the California governor and Hollywood veteran Arnold Schwarzenegger onto stage to welcome everyone to the conference and the state of California. Arnold took the opportunity to apply humor to recent media pressure on his wife, Maria Shriver not using hands free phone in her automobile and maybe some technology help for him and his personal issue at home. Arnold applauded the advancement of technology and innovation that has started in California from bio to green technology along with smart grid and work by Tesla Motors to create green and fast cars. He then congratulated Oracle and Sun with the combined 11 thousand patents and continued technology innovation in the industry. Arnold then discussed how he is working to advance technology in the state and to work harder to be smarter. He referenced the use of GIS, though probably not from Oracle, and digital mapping to support fires and many other state efforts in what we call Location Intelligence. Arnold stated that ‘fear not’, technology will help conquer the challenges in the 21st century.

Larry then came back on stage to discuss Oracle unified support system from using Oracle Enterprise Manager to the My Oracl

Cisco: Contact Centers and Cloud Computing with Salesforce.com

10/14/2009 3:02:31 PM

My research into Contact Centers has led me to develop a model for the systems needed to build and operate a strategic framework for contact centers (see “Customer Performance Management”). They broadly fall into 6 categories: core technology to handle the delivery of multi-channel customer interactions, systems to manage the people (agent) side of running a contact center, traditional CRM, systems to proactively manage the customer experience at every touch point, managing customer information from integration to usage and customer and contact center analytics and metrics.

Until very recently I saw Cisco as being very firmly in the first category – the delivery of customer interactions through its range of Unified Contact Center Products. These really came about as Cisco built its reputation as the number one supplier of systems to create IP-based networks that are enabled by Cisco Unified Communications, and were in many ways a natural extension to take these capabilities into the contact center world. The products enabled companies to build an IP-based infrastructure to route calls to the right agent and integrate with the agent’s desktop so that for example caller details can be automatically popped on the agent screen, These could be deployed in an IP-only environment or built alongside, and integrated with existing traditional telephony based infrastructure. Further extensions mean the products now support multi-media interactions and can be deployed across multiple sites to create a distributed contact center, including agent home-offices.

Having established a leading position with these products, it is not surprising that Cisco has now ventured into the Unified Communications (See: “Unified Communications: Simpler and Eventually Cheaper Customer Interactions“) market and the application of it to the contact center, or more correctly the handling of customer interactions. My research shows that companies still have difficulty improving the percentage of interactions they resolve during the first contact; either agents don’t have the information to resolve the customer issue or they simply don’t have the authority to do so. This is where Unified Communications comes into play. By using functionality such as presence, agents are able to identify who is available with the skills/authority to resolve the customer’s issue and so through the use of collaboration tools they can either get immediate expert help to close more interactions or they can pass the interaction off to another party – both of which are more likely to increase first contact resolution rates.

One of the weaknesses of these solutions was the reporting capabilities. Cisco addressed this during 2007 when it purchased a boutique software company called Latigent. They had a much stronger reporting and analytics suite of products that was able to extract data from Cisco infrastructure and produce more usable and business related information. This has now metamorphosed into the Cisco Unified Intelligence Suite; all though it has to be said Cisco keeps this potential winner hidden under a bushel.

In its latest announcement by Cisco, it seems that by announcing a partnership with Salesforce.com, Cisco wants to raise its presence in the contact center space. From a technical point of view the partnership is not much more than a special connector that integrates Cisco Unified Contact Center w

Oracle Complex Event Processing Advances Operational Intelligence

10/13/2009 10:30:09 AM

At Oracle OpenWorld the focus on Oracle Complex Event Processing was quietly demonstrated in educational sessions how this dedicated technology is helping organizations. The insights on this technology were brought forward by Robin Smith, director of product management and strategy for CEP that is part of the Oracle Event-Driven Architecture Suite 11g and is available today. Currently categorized as Related Technologies on the Oracle website is one of the jewels at OpenWorld. The use of events across the network and applications has been advancing for many decades and dates back to original banking and point of sale systems.

Oracle’s efforts in CEP are part of what I call Operational Intelligence (See:”Operational Intelligence Requires Complex Event Processing (CEP)“) which uses CEP. Moving beyond the limitations of business activity monitoring (BAM) only approaches that only monitor activities which is insufficient, Oracle can help drive action and integration across the enterprise. This is not new technology as it has been advancing for many years and is designed to support the high volume event queues and the real time processing of the events that my examined, correlated, analyzed and presented for informative purposes but also for applications. Oracle has spent time to design the event processor to support the need to manage distribute channels of events across the enterprise. This is exactly what our benchmark research found as more than half of organizations require more than dozen distinct event sources (See: “Operational Intelligence and CEP Benchmark”). Oracle is also advancing the use of industry standards with their work with Continuous Query Language (CQL) that extends use of SQL with support for temporal windows and other important aspects of aggregation. They are also using Oracle Coherence technology to cache and process events in a staging area to support range of application needs. The technology also uses well known methods for application developers like JMS and HTTP to help in the integration of the technology.

The challenge is now not the infrastructure and standards but the simplification of the technology for business analysts and the need to assemble applications when needed. The mashup of this technology set and the Oracle WebCenter Suite 11g with Rich Enterprise Applications (See: “Oracle Middleware Provides Rich Enterprise Applications to Advance Information Applications Market“) will help as the publishing of notifications and interactions with events should be part of broader business users need or methods to access from mobile technologies. As well Oracle will have to embrace the need for business users to take action across business processes and management which is not part of the traditional monitoring only approach of BAM.

Let me know your thoughts or come and collaborate with me on Facebook, LinkedIn

Oracle Middleware Provides Rich Enterprise Applications to Advance Information Applications Market

10/13/2009 9:28:24 AM

At Oracle OpenWorld the education on a new generation of capabilities called Rich Enterprise Applications from Oracle that is part of what is called Oracle Fusion Middleware 11g and Oracle WebCenter Suite 11g was brought into heavy promotion and education. This keynote session by Thomas Kurian - head of Oracle Middleware and Ted Farrell, senior vice president focused on this segment provided some valuable technology insights on what is possible for business analysts and application developers today. Many of the expectations of business users is being driven by the rich application experience found on the Internet along with the simplicity of mobile devices and applications on the Apple iPhone (See: “Apple iPhone and New 3Gs is a Healthy Dose of Apple for Business“). Providing the availability of information and the ability to streamline business processes and provide the basic DNA of business should be at the top of business and IT organizations priority.

We at Ventana Research have defined this market category as Information Applications as the technology (See: “Information Applications: New Generation of Information Technologies“) that unifies accessibility and action to all information including content and data in a range of channels including mobile, voice, web that can be simply accessed by consumers to employees through self-service and simple methods to search, retrieve and act information. This new generation and category provides the essentials to business in information availability (See: “Information Applications: New Focus on Information Availability”).

If you are not familiar with Oracle’s middleware is comprised of a large set of technologies and products that work together to enable a broad set of capabilities from business intelligence and collaboration to business process management and many other areas. The focus on Rich Enterprise Applications was part of a transformation from Oracle historical deep application development focus to what is now possible with the assembly of applications without requiring coding. This focus is built on the evolution and advancement or Oracle WebCenter Suite 11g. The applications built from this platform and tools are dynamic and rich in content and provide methods for faster deployment of capabilities to business by providing easier accessibility to information and interactions across the enterprise.

The Oracle WebCenter Suite brings some key components to support information applications for the enterprise. The Oracle technology to support this application focus also utilizes key technology called Oracle WebCenter Services that helps link together rich content and capabilities like blogs, connections, mail, analytics and text among many that can leverage industry standard interfaces. Oracle WebCenter Space helps pre-integrate the community and portal elements of the application but also is the method to use their composer to assemble and change applications. Oracle WebCenter Ensemble then enables the mashup of HTTP based services to further integrate content from the enterprise and Internet. But best part of the keynote was a real world demo in assembling an application that could be improved by business analysts and not just application development. Interesting was that the application can be and was demonstrated how it can be immediately deployed to Apple iPhone, RIM Blackberry and even Microsoft Windows Mobile without having to make modification but dynamically adapted to the human

Oracle Brings Focus to GRC After SOX Cloud

10/13/2009 4:48:57 AM

Sarbanes-Oxley (SOX) section 404 did a great disservice and service to improving financial governance and controls. The disservice was the amount of time and attention sucked up in the 2002-2006 period as companies worked overtime to get compliant and then make the annual SOX project an easily repeatable process. Unfortunately, much of this effort was not really necessary as the initial interpretation of the act by the PCAOB (Public Company Accounting Oversight Board) confused the stated objective of SOX of applying due diligence to ensure there would be no meaningful risk of fraud or misstatement in external financial statements with corporate financial controls generally. What’s the difference? About a gazillion people-hours spent with no meaningful decrease in risk to investors. (Also see “Sarbanes Oxley, Risk Management and Internal Audit”.) For this reason, the PCAOB issued Accounting Statement 5 in 2007, which clarified the objective of SOX 404 and amounted to a big “never mind” to the earlier approach of mapping, monitoring and alerting on every financial process and any related operational process regardless of their relevance. Instead, companies are now supposed to focus only on the proximate risks to financial statements and do so on a tops-down basis. (Incidentally, a lawsuit is under consideration by the Supreme Court on the constitutionality of the PCAOB itself and, perhaps by extension, section 404 the Sarbanes-Oxley Act, will be decided in the current session. If nothing else SOX confirmed the adage “Act in haste, repent at leisure.”)

While SOX compliance investments were a bust, confusing the lack of value in all-encompassing financial controls with those that provide a positive return on investment would also be a mistake. Financial controls go back millennia because they’re good for business. One of the few benefits of Sarbanes-Oxley has been to spur the creation of IT-based monitoring and control systems that replace a hodgepodge of inefficient and ineffective manual systems with sleeker ones that do the job better.

“GRC” has been very much in evidence at Oracle World, in part because having developed (or purchased companies that developed) product for SOX they (and other vendors) need to spur demand. I try to look past the claims for GRC (some of which are useful and clear; most others that are less so) and focus on the business value the vendors are trying to provide. Unfortunately, although people thing they know what GRC is, there’s still an awful lot of confusion. (As my colleague Mark Smith noted in “IT Analyst Firms Continue Confusion on GRC”).

Given Oracle’s focus on the IT department, it’s not surprising that there’s less focus on the business side. On the other hand, there was one session that nicely illustrated the value of taking the work originally done for SOX compliance that was repurposed for more effective – and less expensive – financial controls. Unfortunately, you could count the session’s attendees on the fingers of both hands with a few to spare. I think that’s more of a comment on the demographics of the attendees than on the importance of the use case.

The company, a class one railroad, has assembled its set of financial controls, monitoring and reporting capabilities using the piece parts offered under the “Oracle GRC” nameplate (LogicalApps, Stellent, etc.). More importantly, the company’s CFO and Controller were committed to changing how they managed financial controls to eliminate as many manual ones as they could, to shift the focus from after-the-fact investigation to real-time alerts, to have more effective controls and to automate reports. The payback from these efforts was that their internal audit consultant saved more billable hours in the first year

Oracle Opens OpenWorld with the Charles and Safra Show

10/12/2009 6:56:12 PM

The first day of Oracle OpenWorld was opened by the ‘ying’ and ‘yang’ of Oracle leadership, Charles Phillips and Safra Catz. Coming onto the stage of technology titans conference is no easy gesture for the gentle but ferocious leaders of Oracle and little different than Larry Ellison and Scott McNeally the previous night (See: "Oracle OpenWorld Sunday Night Opener Highlights Technology Game"). Make no doubt about it that these leaders who herald themselves from investment banking industry who have a strategy and plan to maximize the potential of Oracle’s assets. As referenced by them they have made over $40 billion in more than 58 acquisitions that have work to leverage them across existing customers. What was interesting was the selection of priorities that Oracle brought into the keynote discussion into discussion segments.

The first discussion was a focus on project management which Oracle was highlighting their acquisition of Primavera which can provide some valuable capabilities to manage your technology projects for IT and business. This was led by Joel Koppelman who previously led Primavera and did a great job demonstrating enterprise class project portfolio management Oracle Primavera P6. This new release has integration with the Oracle ERP and E-Business Suite along with middleware technology to help address the need to mind your technology projects to ensure they deliver the value needed. Using portfolio management is quite an interesting lead for Oracle who has a lot of customers that have now a lot of technologies from Oracle and their acquisitions. An interesting fact pointed out is that 25% of World GDP on projects but the use of project management in what is typically called project portfolio management (PPM) is not very pervasively used in organizations today.

The second discussion was about the use of budgeting that IT can use to manage their expenditures to the budget and better manage their IT investments. Though demonstrated as part of the Oracle PeopleSoft applications the use of Hyperion Planning is nice designed for IT financial management which is long needed improvement (See: “Is Your CIO Ready for IT Financial Management”). This is a key message and advertisement for a large IT audience who still struggle in managing TCO (See: “Does TCO Matter Anymore?”) and need to get more sophisticated about understanding how to budget and manage costs to benefits more effectively. Personally, now the CIO can also examine how much of their budget goes to Oracle compared to other providers which is probably a good thing to do.

The next two segments went directly into the industries to demonstrate Oracle industry application efforts. The retail industry has needed help though they have not been more progressive in using applications and analytics to be more intelligent in management of their business processes. Oracle made some clear demonstrations on how to drive better efficiency and profitability to retail management and operations. Oracle demonstrated the latest in advancements with Oracle Retek and Oracle ProfitLogic which both being acquisitions in recent years are major plays into the market. Next was Oracle Trade Management applications to help with campaigns and promotion to improve this significant process. Siebel had historically been very dominant in this application area but had also competed against Demantra which Oracle also acquired. Now with integration of these technologies, organizations using Oracle or Siebel CRM can find better support across the trade management lifecycle from creation to management. Oracle competes heavily with JDA and SAP with all of them not using IRI or Nielsen market data effec

Oracle OpenWorld Sunday Night Opener Highlights Technology Game

10/12/2009 11:56:41 AM

Better than the massive defeats by the San Francisco 49ers and Oakland Raider football games in the bay area on Sunday was the opening keynote at Oracle Open World. The Silicon Valley legends Larry Ellison and Scott McNealy opened up the evening to give personal perspective on the pending Oracle and Sun integration of software and hardware together into the new technology titan (See “Oracle to Make Sun Shine on Oracle”) . The keynote was intriguing to see how everything is changing in Silicon Valley.

Scott McNealy took the stage to provide his perspective on the large event of the pending Sun acquisition by Oracle. He reinforced Sun previous commitment to R&D and to the future with Oracle. Scott pointed out that Java operates on 6.5 milliion devices, 2.5 million mobile phones, 1 billion computers and into technology everywhere on the planet. Scott also brought on stage James Gossling who stated Oracle fastest growing products are ‘big bags of Java’ and is excited to be working for a software company. All of this was fanfare for the Oracle crowd who has from a market share perspective adopted the Sun platform significantly over the last couple of decades. But missing was the current CEO Jonathan Schwartz who dates back to the original Java team and worked under the guidance of James Gosling in the 90’s. In recent years his leadership has been under fire (See: Silicon Valley Sun Rising or Setting on Sun Microsystems?” for the lackluster vision and performance and direct competition by Dell, HP and IBM. If Oracle gets approval and take the reins of Sun I believe they will drive stronger business and product leadership which will be good news for companies using Sun and Oracle.

But what would Oracle OpenWorld be without Larry Ellison who brought his traditional dry wit and swagger to the stage. Larry reinforced that they will spend more not less in their merged companies and to advance the Sun technology and business. Larry was his usual self on any of his technology investments and reinforcing the promise to the future of Sun platform with SPARC technology and Solaris operating systems. He states they will make it even better to compete against HP and IBM which is what any Oracle shareholder would expect. Despite a focus in conversation by Larry on competing against IBM, their partner HP should look out as ‘business is business’ and now Oracle has their own server and storage technology to take share points from IBM and HP with CIO budgets.

Larry pushed hard on Oracle Exadata which is now in their second release with now Sun technology with the hardware on stage. Oracle had started with HP but now there is a financial and business advantage with Sun. Larry was pushing on their advantage over Netezza and Teradata as they are not able to OLTP and they do not have scale out architecture like Oracle. This is all good but will require companies to spend more dollars with them compared to others as the market is more fragmented with specialized database and appliances especially to support analytics. Oracle definitely has new and much smaller challengers like Aster Data Systems, Kognitio, ParAccel (See “ParAccel Breaks Significant New Ground in Analytic Database Technology“), Vertica (See: “Verti

Are Contact Centers Maturing or Not?

10/9/2009 2:10:49 PM

Over five years ago I carried out what I can now see was the first benchmark research into the maturity of contact centers that I had seen. The whole idea was to take a look at the people, processes, information, and technology used by companies to operate their contact centers and to then classify the results into four levels of maturity: Tactical, Advanced, Strategic and Innovative.

The research results threw up a number of surprises. First of all they showed there was a higher than expected number of centers at the innovative level – 28% in fact, with 19% at strategic level, 33% at advanced and 21% at tactical. Deeper examination threw up what is the most surprising results which was that by region, centers outside North America and Europe had the highest percentage of innovative centers. Even deeper examination of the results showed this was due to one primary factor -centers outside these regions were much newer so were not hampered by bad practises and they were early adopters of new technology. Indeed what I found was that many of these centers were providing outsourced services so they had to operate on a commercial basis, they had to put in place more business oriented objectives and targets, and they had to monitor their performance much more closely so they could report against commercially enforceable service level agreements.

We also discovered that indeed size matters, especially when it comes to the adoption of new technologies. Large centers handle many thousands of calls so this has driven them to adopt innovative technologies just to make them as efficient as possible. So indeed it was centers run by telecommunication and retail finance companies that led the way in adopting new technologies.

What came across clearly in the results was that efficiency rules the day, with most centers operating under severe cost constraints. One clear example is that the primary performance measure was (and still is) average call handling time and even customer satisfaction scores come some way down the list.

Since this first benchmark I have conducted several more into the use of technology in contact centers, customer experience management, agent performance management and others, and each time I have mapped the findings using maturity models. Maybe it is because I have raised the bar but sadly if anything maturity levels have dropped since that first study. The primary reasons are that companies are not taking advantage of the innovative technologies that have come onto the market. Products such as intelligent call routing, smart agent desktops, speech and text analytics, customer feedback management, and customer analytics have seen some successes but it is still an even smaller percentage of innovative companies that have adopted them.

Another major barrier is that companies still seem to be sticking to the same performance measures they were using 5 years ago. Efficiency still rules the day and again only a small minority of innovative companies have supplemented these with more effective, or outcome measures. For example, managing agent performance has a direct correlation to customer experience (see “Contact Center Agent Performance Key for Customer Experience”).

So I ask myself, and you, along with I have written (see “When will Contact Centers Ger Smarter”) what needs to happen to once more raise maturity levels and begin delivering on some of the promises. The cry today is that the “customer is once more king” and that companies must improve the

Financial Closing Time – Make it Faster

10/9/2009 7:25:10 AM

I’m writing this blog six days after the close of the month and for most companies, the quarter. Our benchmark research on the closing processfinds that only half of midsize- (100-999 employees) and large companies (1,000+ employees) have closed their books at this point, even though best practice is to have completed the accounting cycle by this date. A majority of companies that take longer than six business days to close their books think that they should shorten the process, so why haven’t they? Earlier this year we recommended that shortening the close should be a priority for 2009. (See “Don’t Forget to Close Faster”) With the year coming to a close (so to speak) shortly, better late than never should be your cry.

There are at least two sets of reasons to shorten the close process. Ventana Research stresses (and a large majority of our research panelists agree) that the main reason to shorten the closing cycle is to improve a company’s effectiveness. Having the accounting data available sooner makes this information available for review sooner which means that a company can take corrective action or take advantage of favorable market trends sooner. For public companies, having the final numbers available in a shorter time period means that they can complete their third party filing requirements at an earlier date or have that much more time to review the documents. A second set of reasons relate to efficiencies. If it’s taking longer than it should to close your books it’s an indication that people are wasting time. And companies that take a long time to get their final numbers out tend to rely on “flash” reports, which requires additional IT and finance department cycles to perform. It is also continues to be a top priority for finance organizations as I pointed out earlier this year. (See “Effective Financial Performance Management“).

Using our people-process-information-technology framework we can evaluate the most important factors that affect how long it takes a company to complete its accounting cycle, and that are key to shortening the process. For most companies, focusing on the process design ought to be the starting point. Simply having a periodic review (at least quarterly if not monthly) in place to identify ways to shorten the close is one way companies have successfully shortened their close. The reason is that there is likely no single factor in your company’s process that will make a dramatic difference. (If it were that easy, you probably would have already done it.) A continuous improvement process works best under these circumstances. Simplification, standardization and greater automation in the process hand-offs between people are three areas where companies typically can achieve results.

From a “people” perspective, expectations and training are important. Not surprisingly, our research shows that companies that collectively decide that it’s taking too long to close and that they should do something about it are more likely to succeed in doing so. Usually, this resolve starts at the top so it’s important that the CFO make it clear that reducing the interval is a priority. Training also can be an important factor and for some companies it’s good to ensure that people know what they are doing.

Technology can also be a barrier to closing faster. Companies that use desktop spreadsheets to manage their accounting close take about 25% longer to get it done. Even companies that have dedicated consolidation software are also intensive users of spreadsheets, especially those that use spreadsheets for calculating allocations, performing reconciliations or using them to store ancillary data. Companies that are heav

Mastering the Art of IT Budgeting

10/7/2009 7:34:53 AM

It’s budget season again – a time when companies are (among other things) determining how much money they will be spending on their IT departments. In our experience, there are many things wrong with how companies budget generally (see “Make IT Spending More Transparent”), and certainly in how they manage the finances of their IT budget. Since the end of the Y2K fiasco and the dot-com boom, companies have spent most of their time and attention on the capital spending portion of the IT budget. Most have implemented a strong governance process (or, at least, a stronger process) to ensure IT investment dollars are spent wisely. The problem is that they still have serious issues with the IT operating budget.

From the perspective of many IT departments, far too much of their budget is devoted to “keeping the lights on” (KTLO – it had to have an acronym, right?) and too little for real innovation and interesting stuff. One of the most important reasons why this happens in so many companies is they have no idea of what drives their IT spending so they cannot allocate the department’s costs in ways that managers can make rational, actionable decisions about the IT costs they are driving. Instead, expenses are allocated by some formula that is only indirectly related to IT spending, such as revenues, headcount or space occupied. Lacking that direct connection, the allocated IT spending is nothing more than a corporate tax. Since executives are unlikely to reduce headcount just to cut their IT allocation, they lobby for a lower “tax;” in other words, a smaller IT budget. This, in turn, creates a woefully sub-optimal IT budget. Too much money going to things that they business either doesn’t want or would give up if they had to pay the real cost and not enough going to activities that would improve the efficiency and effectiveness of the company as a whole. (See “IT Spending Effectiveness”).

From the standpoint of this discussion, there are three basic buckets of IT spending. One is the general IT expenses that are the necessary core of running the enterprise. Like the CEO’s salary and bonus, these are allocated without discussion to business units, period. A second are costs incurred by a budgetary unit (division, department or business unit) that can be assigned to it unambiguously (such as software licensed on a named user basis). It’s the third bucket that’s the problem: the costs that are not essential that are allocated by formula to the business units and a large portion of what is called 'Keeping the Lights On' budget. These are difficult to measure because it can be hard to accurately connect the dots between the activities going on in the IT department and the “things” delivered to the business units (reports or demand planning functionality consumed by multiple departments). Depending on the nature of the business, how it structures its business (centralized versus decentralized) and what it considers essential, these third-bucket costs typically account for 20-50 percent of IT operating expense. For many CIOs, being able to free up even 5 percent of their budget to more value-added, forward looking projects would be welcome.

Step one to fixing the problem is having the mechanism in place to determine the IT budget’s true cost drivers. This includes both activity based costing software, which is far easier and practical to use than ever as a means of calculating cost drivers, as well as IT asset/portfolio management software, which helps track the IT department costs. Step two (which should be run in parallel with step one) is determining the process for allocating and adjudicating shared IT costs. Giving managers the ability to exercise a ‘line item veto’ for a piece of their IT allocation will be a powerful incentive

Liaise Cures Business Interaction Chaos with Microsoft Outlook

10/6/2009 4:14:29 PM

It is not often that there are technologies that make you rethink your current methods of how you work and the tasks that you do constantly. You wish that the way you work would be more productive and less laborious in keeping track of the small stuff and not missing the big stuff. Many of us spend exorbitant amounts of time in personal productivity and communications tools like email and instant messaging coordinating calendars, tasks and activities that are essential to our job. Everything from sending requests for meetings, make assignments, set priorities both internally and to others like clients and partners is no easy tasks and many in business just avoid interactions as the more they communicate the more that comes back to them to do.

Today’s resolution to this issue is only your time and the manual copy and paste from your emails in Microsoft Outlook to the calendar, tasks and into other systems. Most workers and management have become desensitized and just keep doing the manual tasks of keeping track of business interactions. And we all end up missing something along the way. And no, waiting for the next version of Microsoft Outlook to address this issue is like wishing for the tooth fairy to give you money under your pillow for every headache you have from the overload of interactions. How do you efficiently interact and try to keep track of communications to these people and what you requested and what you responded. There has to be a better solution to interact across business and simplify your life.

Well at Demo 09 a round of new companies and technologies launched their presence into the market. One such company, Liaise formally launched their product to market that helps individuals and business dramatically increase individual productivity but most importantly get back the time they need to be effective in their role and responsibility. What Liaise does is to capture your regular interactions through email and other forms of communications in the near future and dynamically examine the text for specific guidance on what you need to be done or scheduled. In what Liaise calls KeyPoint Intelligence is to prompt you within the text of the email for what needs to be done. Most interesting is that they then help you manage these tasks, activities, schedules in a central location on your desktop so that you can ensure you do not miss anything and can collaborate further within context to their completion. As you make choices on words and what they mean the technology learns what to do the next time.

It is almost too good to be true. As a set of non-intrusive desktop productivity tools and add-in to Microsoft Outlook there is no need to install on the server or get your IT organization involved to get started. Since it is designed to make an individual productive it does not require anyone else to having it start to provide value to you.

The company has addressed one of the most challenging tasks for organizations which is to find methods to increase productivity without significant disruption to the existing systems and means that business operates today. Liaise is addressing this to start with Microsoft Outlook but will expand into integrating with Instant Messaging and other collaboration systems that dominate business across the world. If you have not seen it in action it is worth seeing how it works on their website with the software demonstration. Of course in a tough competition of dozens of new products for 2009, their CEO mastered a demo in less than 10 minutes and walked away with first place prize at Demo and a half million dollars of free advertising to help their efforts. The product which is in beta now and I am still hoping to test it myself sometime soon will become available by year end. There is a silver lining to all of this painful email after all and if it co

HR Tech Brings New Products but HR Budgets May Limit Potential

10/2/2009 3:41:10 PM

At this year’s HR Tech in Chicago a broad range of new software products for human resources professional to address their people-related processes across a range of activities from recruiting and on-boarding, compensation and incentives, learning and training, performance and succession along with the workforce analytics and planning were available for HR and associated IT professionals. These are still the areas of business technology transformation from ERP and HRMS to Talent Management that HR has been continuing to invest. The pace of change has unfortunately been operating at a slower pace as the economic environment has reduced HR budgets and ability to consolidate their application portfolio to a common Talent Management platform or adopt individual ones as they would like. This does conflict with some industry analysts dedicated to HR that state growth in the market but would not expect less from them since they depend on this for their own business. I spent a very long day at the event to visit with key technology executives and discus the industry and review many products and technologies.

One of the most insightful meetings was with the CEO of Kronos, Aron Ain who provided details on how they are transforming their Workforce Management solution in their next release at the beginning of next year. This advancement is critical for organizations with workforces that primarily operate on time and attendance based hourly employees where Kronos is a market leading provider. Kronos has completely re-examined the paradigm of how managers and employees interact and what channels they use to do their job functions like planning, scheduling, communicating, approving and monitoring employees. By using the latest in web technologies and interfacing mobile notification and approvals along with using mobile technology like Apple iPhone creatively, this next release will change how applications in the workforce management market operate. Kronos has thought through the need to support generational competencies and diversity in hourly labor intensive organizations. Kronos will have the wow factor that propels them further ahead in the market but the software needs to be completed and released.

I also sat down with the CEO of Human Concepts, Martin Sacks who presented what they have done in advancing the use of how organizational charts are expanded to support workforce metrics and information that can be used for succession planning and examine scenarios for organizational change. The product can be easily used for Talent Pooling to identify the individuals that might best fit new initiatives and objectives in the organization. All of this is part of what they call Workforce Decision Support and the capabilities they provide which gets back to the basics of what HR organizations need to do and provide capabilities to those they support. Most importantly the time to setup and deploy these capabilities can be done quickly and has been a strategic advantage to Human Concepts to meet the last minute but demanding needs of HR organizations.

I had a chance to meet with over fifteen providers to further review their announcements and products. The theme of analytics and reporting dominated across many of the Talent Management providers at the conference though the topic is still not well covered in the educational part of the event. The challenge of consistent workforce information is one that I discussed recently as it becomes a significant challenge for HR professionals. In addition new advancements to the usability of applications was also present with vendors adding easier to

Sarbanes Oxley, Risk Management and Internal Audit

10/2/2009 5:24:05 AM

I recently held a workshop at The GRC Summit (produced by the Global Strategic Management Institute an event where executives from across the world gathered to collaborate and get the latest education on governance, risk and compliance (GRC). In the workshop and in a later breakout session I covered the relationship been Sarbanes-Oxley and financial governance generally.

The main objective of the Sarbanes-Oxley act of 2002 was to reduce the risk of financial misstatements in public company’s financial statements. While most of the other sections of the bill were specific (or became so in short order) Section 404, which covers the internal control over financial reporting, was specific at a high level about what public companies had to include in the way of an assessment of their controls but necessarily vague about how to go about doing it. From my perspective, the core problem with the initial application of Section 404 was that many auditors who were interpreting section 404 were confusing general financial governance with the real objective of the Act – substantially reducing the risk of financial fraud in external financial statements. So, although control of travel and entertainment expense and business credit are important financial governance issues, they are rarely material to the controlling financial statement fraud. Unfortunately, many of the external and internal auditors spent a great deal of time obsessing about details on the theory that somewhere down the line there was a remote possibility of fraud. Worse, they often did this rather than finding ways to implement high-level controls or focusing only on aspects that posed a significant level of risk.

Ultimately, in 2007 the Public Company Accounting Oversight Board (PCAOB – “peek-a-boo”) addressed the misalignment of focus, relevance and materiality was addressed (albeit after way too much money had been thrown at compliance efforts) with Accounting Standard (AS) 2 with AS 5 and the SEC offering guidance to management about implementing, monitoring and reporting on controls. Both of these amounted to a big “never mind.”

But hold that thought! Although implementing, testing and reporting on financial controls across the board to reduce external reporting risk doesn’t make sense, there are plenty of ways finance departments can use more formal controls, automated monitoring and reporting to improve their governance function in ways that that will optimize risk and cut costs. “Optimize” means making the appropriate trade-offs between a company’s risk appetite and costs. For external reporting purposes, it doesn’t make sense to automate the oversight of T&E spending or investing in a system to spot payroll fraud but it probably makes a lot of sense to do this to cut costs and reduce the chance of a damaged reputation if a store manager is stiffing employees on overtime to meet their profit objectives.

Meanwhile, Sarbanes-Oxley did increase awareness on the part of some in the finance function of the opportunity to use controls, monitoring, measuring and reporting for productive business purposes. This, in turn, has boosted attention to the topic of governance, risk and compliance in the finance function. Software vendors, too, see an opportunity to help companies do a better job of controlling cost and risk. However, since “governance,” “risk” and “compliance” exist across and enterprise and there are a myriad ways to deal with them, the term “GRC software” can be very misleading. (See “IT Analyst Firms Continue Confusion on GRC” and “Does GRC Software Exist? Should It?”) Many existing categories of software are an integral part of

IT Analyst Firms Continue Confusion on GRC

9/30/2009 11:58:21 PM

I keynoted at The GRC Summit produced by the Global Strategic Management Institute where executives from across the world gathered to collaborate and get the latest education on governance, risk and compliance (GRC). I keynoted on a topic called “Picking the Right Software for GRC” which is timely with the growing confusion in organizations and across attendees. My colleague elaborated on this recently in “Does GRC Software Exist? Should It?”. New releases of analyst reports from Gartner, Forrester and others are advancing the topic that only vendors who label themselves with GRC or have products with that acronym can address this set of requirements. This is unfortunately misleading since many technologies across multiple software categories can address the need of governance, risk and compliance and not just ones with the labeling.

Unfortunately these IT analyst firms who have dedicated analyst practices fail to mention this since they do not have and background or knowledge of these technologies. This is in part a failure of these firms management ability to cross pollinate and put incentives in place that are focused on the right answers for the client and not for the IT analyst practice. The other element is that these analyst firms only focus on IT and do not advice or research into the business who actually understands their needs across governance, risk and compliance making it unfortunate that they do not truly understand the value and benefits of these technologies. It is important to understand the requirements for GRC within finance and operations that vary dramatically from addressing risk compare to specific compliance. Now, the need to have infrastructure and security systems for IT is something that can be addressed more easily and important part of IT systems to support GRC like security, auditing, content/data management and other well defined categories.

Since GRC is a set of processes and activities, your organization should establish some common definitions that help provide the business need across finance and operations. Part of what software that can be used is business process management systems that utilize a process model, workflow, rules and other capabilities to help drive repeatability and efficiency but can be used to establish a wide array of GRC requirements. The next category is actually that of Operational Intelligence and Complex Event Processing (CEP) which can help provide the right level of monitoring and analytics to determine what issues might arise and to be more responsive. After this is the categories of Analytics and Business Intelligence (BI) which can provide robust set of calculations to reporting and dashboards on the information that needs to be provided in a visible manner. Of course this also means that Information Management which helps in the integration and synchronization of information along with the storage of it. Yes, Performance Management can help too since it provides the method to define these initiatives and objectives along with creating the measurements and key indicators to determine overall success. For those organizations that want to ensure the full organization is appropriately planning for GRC along with mitigating the risks of using spreadsheets should examine the use of Call Centre and Customer Management Expo then there would be no doubt that the core technologies that manage the infrastructure to support the handling of customer interactions are still top of the list. I counted at least 28 vendors that I would place in this category ranging from the big well know vendors such as Alcatel-Lucent, Aspect, Cisco, Genesys, Nortel, NTL and Toshiba to some lesser known vendors such as Altitude software, ASC Telecom, CIPTeX, CTalk, Interactive Intelligence, NewVoiceMedia, OPEX Hosting, Syntellect and Sytel. The messaging was fairly similar to previous years, revolving around the key tenant that customer want to communicate through multiple channels and as technology vendors we can support just about any channel you can think of. The main variation from previous years, especially dominate in the lesser known, new entrants, was that we have software solutions that can support all these channels and what is more in many cases these software-based solutions run “in the cloud”, thus reducing capital expense costs, software licence and maintenance fees, and the need for expert technical support staff. All of which adds up to a clear message that “the contact center in the cloud” is now a reality and this opens up the opportunity for more companies, especially at the smaller end of the market, to create and operate quite sophisticated centers without breaking the bank.

The second most popular type of vendors fell into what I call Agent Performance Management – call recording, quality monitoring, workforce management, agent training and coaching, and agent performance reporting and analytics. Earlier this year I carried out benchmark research into the maturity of contact centers and in particularly what are the main drivers behind the actions of contact center managers. The clear winner was optimizing the performance of agents which led to my recent benchmark on Agent Performance Management. So not surprising there were several vendors offering applications to support this objective. Once again these fell into two categories i.e. the big well know vendors such as Aspect, Nice Systems and Verint to some lesser known, more niche vendors such as Business Systems UK, CyberTech International, GMT Europe, InVision, Pipkins, Q-Max, Red Box Recorders, ServiceTick, Teleopti, and XLScheduler. Typically the big vendors were advocating the use of integrated suite solutions so that all the functionality knits well together, whereas the smaller vendors were taking more of an approach that niche is best.

Given all the importance, including by me in my benchmark research on the topic, being placed on customer experience management, it was disappointing to find so few vendors exhibiting solutions in this space. In terms of smart desktop vendors, I only found Altitude Software with their integrated desktop and multi-channel support software and one specialty vendor, SmartPoint. I also put salesforce.com in this category because although service cloud does have at its core CRM and knowledge management, the full support for customer service brings this functionality and other integrated information together on a smart desktop that agents or anyone else for that matter can use to resolve customer interactions. I might also be doing some injustice to Sword Ciboodle that were showing its systems that can either support a smart desktop or web self-service. Given the importance now placed on web-based self-service there were a few vendors showing their products, such as Convergys, Eptica, and Parature. As to customer feed-back management, Nice and Verint had their solutions

SuccessFactors and Business Execution Software: Confusing or Confused?

9/25/2009 8:01:03 PM

Several weeks ago, SuccessFactors (NASD:SFSF) announced their re-positioning of their company into something they call Business Execution Software and declared this a new software category where they are the leader. According to SuccessFactors this is a new software category that provides business alignment and people performance applications that help with strategy and execution. Clearly business and organizations have known for decades the importance of strategy, planning and execution as you do not execute without effective use of your people to perform the tasks assigned to their role and responsibility. The industry has referred to this as Business Performance Management but SuccessFactors calls it Business Execution with some nuances that lean more to the people elements.

HR organizations for decades have been improving their processes from the 90’s and HRMS to now be more effective in helping those that manage employees to perform effective recruiting, hiring, on-boarding, learning, compensating and rewarding those that perform to expected levels of performance. This has not been easy as HR has not always been progressive in the use of applications to support these processes but getting better in the last 3 to 5 years. HR has seen what silos of individual investments have done to their processes and workforce information as I have written about in “HR Faces Talent Management Roadblock: Workforce Information Anarchy” . This has been driven with a new generation of applications called Talent Management that many suppliers including SuccessFactors has helped grow and they should be applauded as they have over 5 million users of these applications that operate in the software as a service (SaaS) rented approach managed by SuccessFactors and operates in what is called Cloud Computing.

What is confusing to me and others in the industry is that until recently SuccessFactors was advancing the Talent Management needs of HR and business. Why the sudden change in nomenclature? This is not clear as the accomplishment by them and others support the necessary steps of Workforce Performance Management which is how you understand, optimize and align your people to the necessary goals and objectives of the organization. With this announcement and their declaration of a new software category they currently operate in it by themselves from an application supplier. Other SuccessFactors partners are just participating for the partnering value and integration to their applications and want to be part of their marketing and sales efforts.

Do companies ask for business execution software today? No, they see that their ERP, CRM, SCM and other transactional applications have been responsible for those needs. While SuccessFactors is taking a completely different approach to marketing, the HR buyers are still the same. They might be really confused as they do not like sudden changes of conversation when they are comfortable with terminology they have heard for year. So will this marketing and sales change help SuccessFactors or hurt them?

The challenge for SuccessFactors is that line of business leaders are looking for something specific for their area of responsibility. HR has been examining what to use in the Talent Management suite of applications for helping administrative and management aspects of their workforce. How do they help as I have written “Assess Your Workforce and Motivate Your Talent”. Sales looks at sales force automation (SFA) and sales performance management to help their organizations execute in sales. Customer management/contact centers look at agent m

IFRS: Assembly Required

9/24/2009 5:06:38 PM

When it comes to the transition to International Financial Reporting Standards (IFRS), too many US-based companies seem intent on repeating the same mistake they made with Sarbanes-Oxley (SOX) compliance: procrastination. When it came to SOX there was a good reason – that law was a classic “we’ll-make-up-the-rules-later” piece of legislation and it took about 6-9 months for most companies to realize just how far out of compliance they were. In the case of IFRS there is still a great deal of work to be done mediating between the United States’ approach and those of the rest of the world, but there is every reason to expect it will happen. The time to start dealing with it right now, especially as it relates to software.

Only a handful of companies have started the transition to IFRS. Even if the effective date of the transition is pushed out to 2015 or 2016 instead of 2014 (as the SEC originally targeted), your company will have to start keeping its books using IFRS in about four years because the transition accounting period will begin two years before the switch. There is a list of long-lead items that your organization will need to consider now so that it will be able to make considered – not rushed – decisions and have plenty of time for their implementation. Since many of the issues with IFRS are people and process heavy, it’s important to start early to ensure that people are properly trained and the processes work well with your company. And it’s important to consider the software implications of the shift to IFRS. It’s possible that your company will not have to buy any new software right now to handle the shift to IFRS (see “Do You Need New Software for IFRS?”). However, most finance departments in larger companies have obsolescent applications and it may be a good idea to use the transition as a reason to create a roadmap to consolidate and simplify your financial IT systems.

One place to start is your ERP systems. Our benchmark research finds that a majority of companies with 1,000 or more employees use accounting systems from multiple vendors and/or have multiple instances or versions of a given vendor’s system. Part of the migration to IFRS should include a rationalization of your company’s general ledgers. In other words, your finance IT systems roadmap should aim to reduce the number of vendors/instances and replace these with software from a single preferred vendor. Although for some (but certainly not all) companies the ideal would be to have a single instance from a single vendor (and with it, a unified, single chart of accounts), it’s not clear that this would be cost effective. Moreover, since larger companies are always acquiring others, it’s not clear that this situation would be sustainable.

Our benchmarks also show that larger companies are likely to have a complex set of custom finance applications and databases that cost more than they realize to maintain and are a big reason why it’s difficult for them to speed up processes, accelerate their close and so forth. Many of the functions that once required custom-built applications are available in most ERP systems, even the one the company is using now. However, it never seems to be the right time. Eliminating these over the next several years to facilitate the transition likely provides the remaining justification for doing what you should already have done.

Another piece of software finance departments should use along the way to IFRS is “master data management” (MDM – see Can Master Data Management Deliver Results or Headaches?). It allows you to define (“map”) the relationship between the data in one system to another. This streamlines the process of transitioning a chart of accounts from one system to the next, enabling you to accelerate the transition. Incidentally there’s no reason why finance departments shouldn’t be usin

Anaplan: A Man and Company With a Plan

9/23/2009 3:57:19 PM

Anaplan presented at DEMO Fall 2009 this morning, unveiling its vision for a planning application that aims to be easier to use than a spreadsheet, delivers integrated business planning far easier than any spreadsheet can. Integrated business planning (IBP) is the process of connecting the planning function across an organization to improve its internal alignment and financial performance. IBP uses a comprehensive model of the organization linking strategic planning, operational planning and financial planning. Linking all plans and forward looking assumptions across an enterprise, executives and other decision makers are able to evaluate plans more realistically, uncover inconsistencies and risks and assess opportunities (see “Integrated Business Planning – More Important Than Ever” and Where’s the “P” in ERP?). Few companies can execute IBP today and our research shows that one of the most intractable barriers to more effective corporate planning is the fact that a majority of companies (and a large majority of small and midsize companies) use spreadsheets to manage the process. (See “Taming the Spreadsheet Mess”).

Anaplan is designed to support integrated business planning by eliminating the problems spreadsheets routinely pose such as the difficulty of rolling up multiple spreadsheets for an integrated view as well as finding and correcting errors. (These two issues caused by spreadsheets’ lack of referential- and data integrity). Anaplan can give organizations the ability to do detailed driver-based modeling of operations and integrate this dynamically with the company’s projected balance sheet and cash flow statements over the same forecast periods. Only 6% of companies we recently benchmarked in IBP use driver-based planning methods, which explains why most companies have had a difficult time over the past two years adjusting their plans to the extremely high level of volatility in commodity prices, exchange rates and business demand.

Because Anaplan is offering a cloud-based set of planning applications it does this without the need for IT resources (people, incremental hardware or software) and it can be up and running rapidly. Better yet, the company’s business model is designed to make all of this available at a price and ease of use factor that will make it accessible for all but the smallest companies. The company will be offering a free test of its beta software shortly. While any such “free” demo will require you (and by extension your company) to invest some time in doing a preliminary evaluation, I recommend that you take a look because for many companies the trial will be well worth the time invested.

Guy Haddleton, a founder of Anaplan, was the presenter and did a short demo of the product showing the audience how the software can build and maintain a sales forecast for a company with 150 sales people, offering 1,200 products to 200 customers on a monthly (or even weekly) basis, as well a generate periodic reports. I first met Guy about 10 years ago when he was running Adaytum, a planning software company that later was acquired by Cognos and is now a core piece of IBM Cognos’ performance management suite. Many of those involved with Anaplan are Adaytum alumni and all have been focused for the past couple of years on how to express their deep understanding of the planning, forecasting and review functions in a way that would substantially cut the cost (and therefore the price) of auto

Call Centre and Customer Management Expo Highlights Cloud Computing

9/22/2009 7:23:24 PM

The Call Center and Customer Management 2009 exhibition got under way today. With over two hundred vendors exhibiting, several parallel presentation and workshop sessions, this is the place to be in Europe for companies looking to find new applications for the contact center. The first thing that struck me as I arrived was the focus on hosted, or cloud-based solutions and the number of countries trying to tempt companies to outsource their center to their country. Both of which seem to be somewhat in contrast to my recent research findings that show that companies by far and away still prefer to source their systems as licences to use on-premise and the reducing trend for companies to outsource their call center.

However not surprisingly salesforce.com are here beating the drum loudest as to the benefits of moving to a cloud-based solution and they certainly have persuasive arguments as I set out in my recent blog – no hardware, no support staff, no annual maintenance fees and my colleague in a recent US launch of their new release that “salesforce.com Advances Customer Service in the Clouds”. All well and good but I regard it much more important as to what the service offers and how this will benefit companies, particularly those that are in the majority and have less than 50 seat centers. In this respect they were showing of another benefit of a cloud-based solution in that having only just launched service cloud back in the early summer, it is demonstrating Service Cloud Version 2. This takes ever more advantage of the Instranet acquisition, which now provides “knowledge in cloud” and increasing support for the integration of customer service and social media. Whether the whole phenomenon of people voicing the opinion and seeking answers to questions they perceive the company’s call center can’t answer becomes an ongoing process, it certainly exists today and being able to integrate these types of interactions into the end-to-end customer service process is something companies certainly should be considering.

However salesforce.com Service Cloud 2 is not the complete answer to anyone trying to create or replace their contact center. The applications certainly will help agents resolve interactions but there is still the question of how to manage what agent gets what interaction. The answer lies in a new partnership with NewVoiceMedia. It has developed a call routing application that sits in the cloud and has recently partnered with saleforce.com to provide a tightly integrated solution. Its application sits within the saleforce.com application and uses data that can be extracted from the main database, or indeed any other databases, to route calls based on just about any data source or combination thereof, adding what is increasingly a key capability for contact center managers. Even small/medium companies can therefore take advantage of what I call “smart routing” and based on input to NewVoiceMedia’s IVR application they can route calls to agent that knows the customer best, or knows most about the product the customer is inquiring about, or is best at closing sales. It application also includes call recoding so that recordings can automatically be attached to the customer record for subsequent retrieval when answer future customer interactions. And it is all cloud based so comes with the same advantages, especially proving smart routing at affordable prices.

These are just two high profile examples of vendors pushing applications and services out to the cloud. Many of the traditional contact center vendors ar

IBM Cognos Express Aims to Simplify Midmarket BI

9/21/2009 5:03:06 PM

The soft underbelly of the business intelligence (BI) software market has traditionally been the midmarket, which Ventana Research defines as organizations with between 100 and 999 employees. These medium sized businesses have been reluctant to devote budget to BI primarily because they typically lack the IT resources and budget along with the patience to develop and configure the moving parts required to deploy BI and its supporting data infrastructure. I have seen how many of these organizations do their planning, forecasting, reporting and data analysis with large and often unwieldy spreadsheets as my colleague calls “Taming the Spreadsheet Chaos” and primitive tools that come bundled with applications.

Midmarket organizations seeking to improve consistency of information and metrics and use it more effectively for finance, strategy and operations should evaluate whether changes in the marketplace could be making BI a more realistic and less disruptive option. The latest development is the release of IBM Cognos Express, which offers a pre-configured BI, planning, forecasting and analysis system designed for easy deployment and management. IBM Cognos created the offering by surrounding its TM1 in-memory multi-dimensional data store with tools from Cognos 8 BI and other parts of its portfolio for reporting, visualization and analysis. IBM Cognos Express will compete with midmarket offerings from SAP Business Objects as well as others who have been successful selling to business like QlikTech.

The fact that this is IBM Cognos, not just the pre-acquisition Cognos alone offering the system, could make a difference. IBM is dedicating a new business unit and applying its ample resources for financing, advertising, marketing and partner channel activities. However, midmarket organizations will only bite if they find credible the “no assembly required” claims promised by the pre-configured system and can clearly see why purchasing it will lead to better business results. All of this is a good step forward as I see that BI should be for any sized business where the complexity and cost is reduced to make it easier for using it more strategically.

Let me know your thoughts or come and collaborate with us on LinkedIn and Facebook .

Regards,

David Stodder - Research Director

Better Customer Management using Information Applications

9/17/2009 6:41:37 PM

Ventana Research defines Information Applications as the technology that unifies accessibility to all information including content and data in a range of channels including mobile, voice, web that can be easily accessed by consumers to employees through self-service and simple methods to search and retrieve information. My colleague recently discussed this need quite elegantly in Information Applications: New Focus on Information Availability. There are a couple of reasons why these are so important when it comes to improving customer management.

First of all in a benchmark research into customer information management I discovered a major disparity between how many systems business users believe contain customer data and the number that IT actually knows contain customer data. Business users largely believe customer data sits on average in 3 systems, which are typically their financial and CRM systems, and a large number of spreadsheets. On the other hand IT on average believe the number is more like 21 systems, which not only includes the ones business expect but systems such as network management, call routing software, knowledge bases, call recordings, survey data, data warehouses, e-mails etc. etc. It is therefore not surprising that business cannot understand why they can’t have a single or 360-degree view of the customer whereas IT knows it to be almost impossible to produce one that would contain all customer data.

In another benchmark research into customer experience management I found that the vast majority – just over 80 percent - of companies have identified that in these trying economic circumstances they need to improve the way they handle customer interactions i.e. phone calls, visits to the web site, IVR self-service, IM sessions, text messages, responses to e-mails and other written documents, and in doing so improve customer satisfaction levels. As well as getting these interactions to the right point to be handled, companies face the challenge that to improve their responses they need to know their customers better – this absolutely requires the 360-degree view so that either the person or technology handling the interaction can make more informed decisions on how to handle the interaction and achieve the best outcome.

The traditional way of overcoming customer data and interaction issues is both time consuming and expensive. In one way or another it typically involves lots of software development that uses published application interfaces – if they exist – to develop extractors that pull the required data from a file, place it in a data mart or warehouse and then build reporting and analytics applications that can extract information from the data. In the contact center space this often manifests itself as a unified agent desktop that replaces multiple application interfaces with a single interface that hides data access behind closed doors. Information applications have the potential to replace both of these traditional techniques. Based around technologies such as search, display, share and collaboration they offer the chance to access all customer data and display it in much more user friendly ways. They can do this with both structured and unstructured data such as call recordings and text-based files. And they can do it with a lot less software development, making them cheaper and faster to deploy.

Information applications are in their infancy, both within the enterprise generally but even more so in the contact center. But I recommend you follow new technology developments, as I expect them to have an increasing impact both in terms of producing the 360-degree customer view and improving the customer experience during the handling of interactions

The Finance Appliance

9/17/2009 3:25:32 AM

IBM Cognos held its annual analyst summit in Ottawa recently, which provided a gauge of the progress the company has made over the past 18 months in extending its product reach into finance and operations. In particular, looking at the string of acquisitions that have produced the current line-up, I think IBM Cognos has achieved critical mass in constructing a “finance appliance,” an integrated set of software that finance departments can acquire in pieces or sets to automate processes and execute related analysis and reporting. The company describes this as a 21st century business intelligence and performance management platform. It’s the result of having acquired and pulled together applications for planning, performance management and statutory financial consolidations on top of an acquired multidimensional server and coupled with Cognos’ analysis and reporting capabilities. I think this is a good trend for finance departments, since it should make it easier to use IT more effectively in their core processes and lower the total cost of buying and owning the software.

The point of any software “appliance” is that it provides a company with (relatively) easy to implement functionality dedicated to a specific functional area. An appliance answers the question “Best-in-class or suite?” with a “Yes.” Recognizing that most larger companies already have some level of functional capability for automating core processes or providing analytical and decision support capabilities and therefore generally are in the market for only a single capability at a given time, an appliance allows a company to buy one and forget it, or buy one part and buy another at some future date. Recognizing that departments can be proprietary with their data, an appliance gives buyers an option to have a data store that requires limited maintenance or other forms of IT department attention. The data store also should be able to pull information from other parts of the business, since finance must incorporate operational data and metrics for managing processes, performing analytics and for decision support. Business people do not buy process management or analytical software simply to collect information – they want to get information >out< and do this easily. Moreover, finance people are used to working and solving problems in spreadsheets, so an appliance needs to be able to look and behave like and like spreadsheet without having their inherent defects.

From my perspective, the Ur-“finance appliance” was Micro Control from IMRS (later known as Hyperion Software). It gave finance a way of performing a statutory consolidation of multiple general ledgers from multiple vendors using a personal computer. The four key aspects of Micro Control that appealed to finance were: because it ran on their PCs, the department controlled it, finance people could operate it (you rarely needed IT), it addressed the problems that spreadsheets created (errors and the hassles of roll-ups) and it was relatively inexpensive to buy. The technological underpinnings of Micro Control and, later, Hyperion were trivial. (A characterization I recall Oracle President Charles Phillips using when he was a Wall Street analyst and covering IMRS’s stock.) Simplification, functionality and accuracy, however, were what buyers wanted to buy, not technology. Not much has changed.

It would be great to report that IBM Cognos has the finance appliance completely nailed. Since the company has ambitious plans for evolving its financial performance management business line over the next several years, that’s certainly not the case. I would characterize the current state of their product line-up as having crossed over the line into “got-it-right-enough” territory as a “finance appliance.” Having TM1 server as part of the line-up certainly has made it possible to have all the piece parts of an appliance available and for many (existing or potential) users it has improve

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