Facebook, et al are Soooo 2007 — Here’s Where the Real Action Is

January 20, 2008 at 6:31 pm · Filed under Business Intelligence, Enterprise 2.0, Enterprise Social Computing, Enterprise Software, Facebook, Information Management, Interview, SAP, Social Networking, Web 2.0, Webinars

Web 2.0 — as glorified by Time Magazine when the publication named “You” as the Person of the Year — has moved from entertainment and social networking medium to strategic corporate weapon.

That’s the view of best-selling author and digital society guru Don Tapscott, who recently declared that Web 2.0 “is no longer about hooking up online or creating a gardening community of putting a video onto YouTube… The new Web, so-called Web 2.0 and service oriented architecture are really becoming a new mode of production, and changing the ways that we innovate, the ways that we make decisions, the ways that we collaborate, and the ways that companies engage with the rest of the world.”

Don is a featured speaker at the upcoming FASTForward ‘08, to be held February 18-20 in Orlando, Florida.

I recently moderated an ebizQ Webinar in which Don discussed how Web 2.0 technologies and approaches are dramatically changing the way businesses manage and analyze information. (Audio replay available here - registration required.)

Don Tapscott broke new ground in 1996 with his book, The Digital Economy: The Promise and Peril of Network Intelligence. His latest book is Wikinomics: How Mass Collaboration Changes Everything, co-authored with Anthony Williams.

In our Webcast, Don described how he sees the Web 2.0 world — with its high degree of collaboration — changing the face of business intelligence to “collaborative intelligence.” Prior to the introduction of Web 2.0 methodologies, he explained, internal data had “been accessible in various limited ways through traditional ERP reporting systems, MIS and business intelligence.”

Now, he continued, “for the first time, this is all being supplemented by massive quantities of additional data that is created through new models of collaboration, as consumers and employees use the new tools of collaboration — wikis, blogs and social networks.”

“The marriage of this new accessible data with the firm’s traditional internal data creates an unprecedented challenge, as well as an opportunity to gain insight into the behavior of the company’s most important stakeholders, and to translate that knowledge into success in the marketplace.”

The speed of Web 2.0 processes is also changing what end-users expect from BI approaches as well. “Think about if you do a Google search, you get the results back instantly. If the results took half a minute, or five minutes, or 10 minutes, you’d probably stop using Google so much. Traditional BI was kind of like that — which is part of why we didn’t use it so much Because you’re calling out to a disk, basically.”

The merging of Web 2.0 and business intelligence has become an enormous opportunity for growth, Don said. “For starters, we’re seeing the integration of business intelligence, which has historically has been about numbers, with content and knowledge management, which has been historically about words.” For example, Don foresees the rise of of 3-D visualization of BI data.

“The mother of all opportunities is people across an organization being able to collaborate more effectively around data.” He calls this collective intelligence the holy grail, in which “minds across an organization can come together around information and data that they believe and is relevant and timely and pertinent to them.”

(An audio replay of our recent Webcast is available here - registration required.)

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Living the Social Media Values at SAP

July 26, 2007 at 10:59 am · Filed under Enterprise 2.0, SAP, Social Media Summit

It’s a cold day in hell pretty rare when a large company invites bloggers to sit in on (and actively participate in) a real working marketing strategy session but SAP, the once reclusive software giant that has embraced social media in a huge way, did just that Tuesday by inviting Jeff Nolan, Jason Wood and myself to join the SAP Social Media Summit in downtown Manhattan.

The meeting was convened by Steve Mann, head of SAP’s Total Customer Experience, Competitive Marketing and Services Marketing functions, who looked amazingly alert for a man who recently became the father of triplets. The goal was to come up with a strategy to build on the success of SAP’s Blogger Relations program, run by Mike Prosceno, which has garnered all kinds of positive support in the enterprise software corners of the blogosphere and for the SAP Developer Network (SDN) and Business Process Expert (BPX) communities, headed by Mark Yolton.

The SDN has doubled in size over the past year to 850,000 members and become a popular community for global geeks who get points (and maybe even a free t-shirt or luggage tag) for participating in forums, answering technical questions, and blogging. The site now has 2,800 active contributors, draws 5,000 forum posts a day, and the average time between post/question to first response is 20 minutes. The BPX community, which had 10,000 early adopters, has now passed 150,000 members.

Although SAP’s social media efforts are among the most advanced I’ve seen among enterprises, they are still young and much of the day-long discussion focused on such basic questions as how far the next phase of social media development within the company should go and how fast, when to look for senior level executive sponsorship, and what existing internal and external initiatives might be best candidates for “socialization.”

I wasn’t able to attend day two but at the end of the first day a consensus seemed to be building toward trying not to make rules that might discourage innovation, accelerating the social media adoption process by trying several test projects to see what works best, and deferring the pursuit of top level “sponsorship” until the program matures a bit more. Having spent a number of years working in big company communications, I found all these ideas to be extremely sensible.

My meager contribution to the proceedings was to suggest that because social media can’t be controlled or directed through traditonal marketing and public relations methods, there will almost certainly come a time when something unexpected happens and the program will need “air cover” from a top executive who has been willing to adopt it as his or her own. Most midlevel large company grassroots initiatives I know about are not there yet, but at the “keep informed, but don’t make responsible for” stage.

I also stressed the importance of living the values that embracing social media implies, which are such rare corporate habits as transparency, honesty, accessibility, and trust. The blogosphere is unforgiving of perceived hypocrascy and reputations can be damaged by social media as quickly as they can be bolstered if there is a gap between what corporations say and what they do.

But, the simple fact that Jeff, Jason and I were in the room (and not asked to sign NDAs) tells me that this is a lesson that SAP’s social media leaders and innovators already understand.

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PR and Social Media: Can’t Anybody Here Play This Game?

July 19, 2007 at 9:58 am · Filed under Enterprise 2.0, SAP, Social Media

Jimmy Breslin’s famous query about the hapless 1962 New York Mets seems apropos of many PR “professionals” these days as they scramble to turn those inviting “Comments” sections of blogs into promotional nuggets for their clients. Many of these nuggets are so blatantly obvious and written in such PR mush that they have the undesired effect of making the companies mentioned (even the innocent bystanders) look silly and manipulative

Here’s an example from Zoli’s Blog yesterday:

Sam writes: Either way you go…without an efficient software infrastructure, we could not have coped with the expansion of the past years. Previously, financial accounting and retail were accommodated by stand-alone applications. A custom interface supported communication between the two applications, which meant that data had to be captured twice or imported a second time.

We realized that at some point in the near future, this type of data handling and storage would no longer support our expanding business and would render the system too inflexible to support the expanding number of product variants. This led to the decision to implement a new solution that could handle everything – now and in the future.

We are in San Diego and were paired up with a company called Tryarc (http://www.tryarc.com/) in Los Angeles. They are a premier SAP business partner. While our first impression was SAP is too much for what we need, Tryarc turned us onto the SAP solution for small and midsize enterprises; it’s called SAP Business One. A subsequent presentation of the product had us convinced. SAP Business One was implemented in just a matter of weeks – in part because the standard functions of SAP Business One matched 95% of our business processes. We implemented an interface to our Web shop using SAP Business One Software Development Kit, enabling incoming Internet orders to flow automatically into the business software.

Now, all enterprise management functions are accommodated in one system. SAP Business One provides entirely new opportunities. The only alternative would have been to invest considerable sums in additional stand-alone solutions. Our infrastructure made this pointless. In addition to being the more economical solution, SAP Business One is more comprehensive. It plays its part in making the processes in the company much more transparent than before. Purchasing and sales processes used to be separate, manual transactions supported by paper forms that were stored in file cabinets and forwarded by hand when required. Today, when an order is created and confirmed, a delivery note and invoice are generated, giving the warehouse the go-ahead for delivery. In parallel, the transaction is shown as an open item in accounting.

If the merchandise is in stock, customers can receive their order immediately.

Finally, each department can access this system and exchange data with the other divisions. The result is a significant improvement in the internal information flow. This is particularly important for an enterprise like ours that covers all of the manufacturing steps – from development and production to sales and technical support. Today, the time between placing an order and delivery averages less than 24 hours. The improvements delivered by SAP Business One lay the groundwork for the continuing growth of our company. For example, we are planning to exchange price and delivery data with its customers via an electronic data interchange interface in the near future.

The enterprise wide system is an investment worth it’s weight in gold. We could not be happier with SAP and the people at Tryarc who helped us get up and running.

The link on Sam’s name goes back to Tryarc so this is likely a clumsy attempt to plant a fake testimonial as a legitimate comment. It’s embarrassing for Tryarc and for SAP, who had nothing to do with it and wouldn’t have because they’re one of the smartest companies out there on the social media front.

Zoli, who has a lot more patience than most, offered some sound advice in response:

Sam, or whoever you are. I will not delete this comment, because you do make a point about the value of integrated systems, which, as a former SAP-er I appreciate. But generally speaking, this would be considered spam since:

- It’s a canned long sales pitch not directly relevant to the subject (OK, a tiny bit relevant, very remotely).

- You misrepresent yourself. Next time, if you pretend to be a customer, you might want to drop some detail of “your” business, that would actually support your long pitch.

Last but not least, I used to run businesses like Tryarc, and I don’t think spam is the best way to market yourselves.

One more example (hat tip to Jeff Nolan). This is how Ben Popken, an editor at The Consumerist reacted to a planted comment yesterday:

Death to Sockpuppets
Stay Out Of Our Comments, PR Douchebags

 

Regarding this morning’s “Bank Of America Wins, Buys Chicago’s LaSalle Bank,” commenter “Stankwell,” whose first and only comment was up today, wrote:

LaSalle customers should be happy. Among other things, they’re gaining access to world-class online banking and a coast-to-coast branch and ATM network.

As to charitable giving: BofA is a monster — the good kind! Evidence shows that local donations go up considerably under the new regime. Ask any informed person in Boston or San Francisco.

Talking points much? Nice try. Seriously. You almost sound like a human. But no. BANNED.

Considerably less charitable than Zoli, for sure, but Popken does offer a piece of advice later that PR people should have stenciled on their wrists: “Slogans and marketing-speak glow like ugly neon because they are phony. This is an anti-phony web site for consumers. It wasn’t so much what was said, but how it was said.”

There is absolutely no reason why PR people can’t be part of the conversation but, they have to to to learn to play by the new rules. Be transparent, lose the jargon, and add something of real value.

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SOA demands a new 80-20 rule for application development

July 8, 2007 at 9:56 am · Filed under Enterprise 2.0, Enterprise Software, IBM, Microsoft, SAP, SOA, SaaS, mashups

Services oriented architectures (SOAs) are not only forcing a new way of looking at how to construct applications and composite services — SOA is now changing the meaning of what custom applications are and how they will be acquired. And this change has significant ramifications for IT developers, architects and operators as they seek a new balance between “packaged” and “custom” applications.

As more applications are broken down into modular component services, and as more services are newly created specifically for use and reuse in composited business services, the old 80-20 rule needs to make way for a new 80-20 rule.

The old 80-20 rule for development (and there are variations) holds that 80 percent of the time and effort of engineering an application goes into the 20 percent requiring the most customization. Perhaps that’s why we have the 90-10 rule, too, which hold that 90 percent of the execution time of a computer program is spent executing 10 percent of the code!

SOA skews the formula by making more elements of an application’s stated requirements readily available as a service. As those services are acquired from many sources, including more specialized ones (from third-party developers or vendors), a funny thing happens.

At first the amount of needed customization is high — maybe 80 percent (a perversion of the old rule) — either because there are not many services available, or because the services are too general and not specific to a specialized vertical industry or niche function.

Then, over time, with investment, the balance shifts toward the 50-50 point, and reuse forms a majority of a composite applications or business process, even for highly specialized applications. These composited functions then become business-focused service frameworks, to then be reused and adjusted. Those architects that gain experience within business niches and verticals to create such frameworks can make significant reuse of the services.

They, and their employers, enjoy tipping points where the majority of their development comes from existing services. The higher they can drive the percentage of reuse, the more scale and productivity they gain. They become the go-to organization for cost-efficient applications in a specific industry, or for specialized business processes.

These organizations benefit from the new 80-20 rule of SOA: The last 20 percent of customization soon takes only 50 percent of the total time to value. The difference from 80 percent is huge in terms of who does SOA best for specialized business processes. And it makes the decision all the more difficult over how to best exploit SOA: internally, or via third parties, integrators, or vendors.

It used to be that the large packaged applications vendors, like SAP, Oracle and Microsoft, used similar logic to make their vast suites of applications must-haves for enterprises. They exploited reusable objects and components to create commodity-level business functional suites that were soon deemed best bought and loaded, and not made, company by company, across the globe.

But with SOA the same efficiencies of scale and reuse can be brought to much more specific and customized applications. And those applications, if implemented as web services, can be ripped up, shifted, mashed adjusted and changed rapidly, if you know enough about them. The flexible orchestration of loosely coupled services means that development teams can better meet business’s changing needs.

A big question for me is which development teams will be benefiting most from the new 80-20 rule SOA activities? After attending the recent IBM Innovate conference in May, it’s clear that specialization in SOA-related business processes via services frameworks will change the nature of custom application development. IBM and its services divisions are banking that the emerging middle ground between packaged applications and good-old customization opens up a new category they and their partners can quickly dominate with such offerings as WebSphere Business Services Fabric.

If IT departments inside of enterprises and their developer corps can not produce such flexible, efficient services-driven business processes, their business executives will evaluate alternatives as they seek agility. Such a market, in essence, forces a race to SOA proficiency and economy. That race is now getting under way, pitting traditional application providers, internal custom developers, vertical application packagers, and systems integrators against one another. Read the rest of this entry »

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Reuse of code is the key to keeping IBM from being a 500,000-employee company

July 5, 2007 at 3:28 pm · Filed under Enterprise 2.0, Enterprise Software, IBM, Microsoft, SAP, SOA, SaaS

Nice piece in the The New York Times today about how IBM is again re-inventing itself as the “blended IT provider.” Those are my words. IBM is seeking the means to blend talents, technologies, locations, approaches, people-process, and — above all — applications and services.

After attending a few IBM conferences over the past two months, I have a pretty good sense of what the new IBM is all about. I think they have a strong and correct vision, that success nonetheless depends on extremely good global execution across many disciplines, that time is short, and that it will be quite hard for nearly any other IT provider to emulate IBM if it succeeds and develops a sizable lead in crucial markets like health care.

What The Times story did not address is the essential role that SOA and code reuse will play in this vision and its execution. IBM and most large IT providers (and users!) recognize: They can not just throw more people at the problem (even if they could get them). Enterprises need to rush to find the right blend of wetware and flexible software services, and then aggressively reuse the software.

As IT solutions become highly customized and depend increasingly on deep knowledge of industry verticals and individual companies — “people as solution” just won’t scale. Any and all technology options should be on the table. Costs should be managed for long term ROI. Locations of the assorted workers and the IT itself should be as flexible as possible, but not remote nor onsite as default.

Once these productivity adjustments are in full swing, the deciding factors for success will be about how smartly software components and networked application and data services are defined, exploited, leveraged and extended. The 80-20 rule will have great bearing on the efficiencies. In my interpretation for this blog, the 80-20 rule holds that 80 percent of the cost and labor comes from the 20 percent of the applications requiring the most customization. And that’s true even if 80 percent of the applications are crafted from past services, shrink-wrapped precedents and stock components.

In highly customized development, however, reuse percentages start out low — due to the high degree of specific requirements and unique characteristics of the tasks at hand. For vertical industry custom development, it may be the 50-50 rule (half reuse and half fully custom) at best for some time. Costs will be high. But those IT providers and outsourcers willing to get in first and learn, that share the knowledge acquisitions risk with the clients will gain significant long-term advantage.

I can see why IBM is buying back so much of its stock.

That’s because those IT providers that can boost the percentage of reuse closer to 80 percent — even on highly vertical and specific custom projects — to be blunt, win. As IBM, SAP, Oracle, Microsoft and HP roll up their sleeves and get their people deeply into these business-specific accounts, they will come away from each encounter richer. They will be richer in understanding the business, the industry, the problems and discrete solutions — but they will also be richer by walking away with components and services germane to that business problem/solution set, ones that will be easily reused in the next accounts (anywhere on Earth).

The providers can also apply these components to creating on-demand applications and SaaS services for the potentially larger SMB markets that they may wish to serve, in highly virtualized and account-specific fashion. That recurring revenue may make up for the investment period in sharing risk inside those larger vertical industries. Lessons learned on-demand can be applied back to the larger enterprises. And so on.

The growing library of code and services assets that blossoms for these early-in blended IT providers will assuage the need to scale the people over time. Expertise and experience on a granular, “long tail” basis coupled with highly efficient general computing fabric will be the next differentiating advantage in IT and outsourcing. Reuse will solve both the people problem and the business model problem. This, incidentally, has SOA written all over it. Grid and utility computing with myriad hosting options also supports this vision quite well. Get it?

Lastly, who controls and owns the libraries of business execution knowledge is a huge issue. Individual companies should and will want to own their business logic, even patent or protect it legally. They may want their blended IT provider to help them develop and create this intellectual property, and remain assured that the client always owns it. None of this “my IP” popping up in China somewhere business, either.

There will be tension between what the blended IT provider owns and what they client business owns. Knowing where the demarcation point is that separates the provider’s intellectual property from the client’s will be an area for especially careful consideration — as early in the project as possible. IT providers and clients will need to partner more than tussle. IBM gets this and is already doing “play nice” vendor dance. There are still some steps to learn here for Oracle, Microsoft and SAP.

These boundary and ownership issues will be worked out such that the businesses can keep the business logic and innovation jewels (and compete well by them for a long time), while also allowing the IT provider to take away enough knowledge and code assets to make its initially costly, people-laden work worth the slog. An amenable bridging of these concerns will ultimately lower costs and speed of execution for all.

In those areas — large and varied they will be — where ownership and control are hard to agree upon … open source licenses on the services and applications within the boundary zone of ownership makes great sense. It will be hard to draw a fine line between client assets and provider assets, so install a mutually beneficial grey area of open source “ownership” between them. That’s why developments like GPL v3 are so important. Open source will apply to applications, components, and services far more importantly than platforms and runtimes in the future.

In this “blended IT provider” environment, the providers that can be trusted to leave the jewels alone may end up getting the better spoils of general reuse efficiency. And therefore become the low-cost, high-productivity provider in myriad specialized field (what makes you special?), and energize their own global partner ecologies, to boot.

Yes, there is indeed a new brass ring in the global IT business, and IBM has its eye on it.

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SAP to Enterprise 2.0 Community: We Get It

April 26, 2007 at 11:02 pm · Filed under Enterprise 2.0, Enterprise Software, SAP

A hot topic among social media bloggers these days is exactly which big companies “get” the value of connectedness, community and emergent technologies and which don’t.  A subsidiary discussion to that is around which traditionally managed corporations are jumping on the bandwagon for PR reasons because they want to be seen as one of the cool kids and which ones are actually making fundamental changes to way they interact with their customers, partners and employees.  

Having spent a lot of time talking with a number of SAP executives at SAPPHIRE in Atlanta earlier this week, I’m delighted to report that SAP is one of those forward-looking giants that get it.  Big time.   I’m not talking just about the fact that the company invited more than 20 of us lowly bloggers to sit in the big room with the regular press and analyst corps or that Mike Procenco and Stacy Fish put together a dynamite program of sessions with executives on topics that were of particular interest to us. 

Or even that they provided access to any executives or customers we wanted to talk to and let us talk to them without hovering protectively in the background.  All of those things were welcome and displayed a level of transparency and candor that just didn’t exist in any big corporation I know of five years ago.  

The new SAP attitude is clearly rooted in the company’s discovery that communities and co-innovation are a superior approach to the ”assign an army of software developers to a task and see what they come up with” style of development.  Opening up the process to partners and customers (and, indeed, anyone who wants to participate) provides the kind of give-and-take that leads to better products, satisfied buyers, reduced costs and happier employees.  

The granddaddy of these communities–the SAP Developer Network (SDN)–has grown from 340,000 members in 2005 to more than 750,000 today. (SDN has its own “evangelist,” Craig Cmehil.  The Business Process community (BPX) was launched in the third quarter of 2006 and already has more than 100,000 members.  Both have proven to be invaluble resources and converted even the most skeptical oldtimers to the belief that there may be something to this Enterprise 2.0 business afterall. 

Another hub of 2.0 activity at SAP is the Emerging Solutions unit, led by general manager Dennis Moore, which is working on things like creating widgets that make it much easier for authorized users to get to the data they need inside SAP systems and a joint project called Duet with Microsoft that will allow SAP users to seamlessly use Office tools to work with processes and data.  The unit even has its own vp of “imagineering,” a bright young man named Denis Browne.

Emerging Solutions was also involved in building a kind of internal MySpace/LinkedIn social directory called Harmony where employees with similar interests and skills can find each other.  I was sittin way down at the end of the table when Dennis Moore was explaining Harmony but I somehow got the impression that Harmony is, at least in part, an attempt to provide SAP’s best employees with an alternative to posting their resumes on LinkedIn or MySpace where they can easily be poached by other firms.

What most convinced me that SAP gets it, though, is the enthusiasm of the people I spoke to.  You couldn’t help getting the feeling that SAP has become a fun place to work.  Not the kind of thing you would expect from a aging–how should I put this…German…engineering-oriented–software company with a reputation, not entirely undeserved, for making complex and costly products mainly for big companies.  The new SAP is rapidly becoming a classic case study in how Enterprise 2.0 technologies, combined with a collaborative, social mindset, can give a giant corporation a second wind.

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