ERP – ITSinsider

Business Process 21C: The Jackhammer Tales

Over the past few months I’ve begun to reflect upon how I arrived here at the intersection of process and innovation in the Enterprise. It occurred to me that everything I learned as a researcher, a writer, and an industry observer in the services provider space (my pre-Internet career) now had great bearing on what I was seeing in the Enterprise as a result of the pace of disruptive technologies impacting the market. The question that kept re-emerging for me was: how are rigidly defined business processes that were hammered out in the 90s reconfiguring to adapt to better, faster, more efficient ways of meeting customer needs? Even more puzzling is, if my friend Josh’s old joke is correct, “SAP is like pouring concrete into a company,” how are large enterprises dismantling foundational ERP systems to include disruptive technologies? After all, no 21st Century business can stand to stay frozen in the past. Even SAP itself is retooling to provide greater flexibility and real-time actions and insights with its HANA in-memory database and its JAM social platform.

This big question has been vexing me for a while, so I asked my friend and fellow Enterprise Irregular, Phil Fersht at HfS Research, if he’d be interested in an exploratory study to see how BPO providers and consultants are responding to new advances in mobile, social, the Internet of things– all new capabilities that were not present when the majority of institutional business processes were “cemented” into the Enterprise. I’ve seen evidence of several companies who’ve been introducing social, in particular, to provide greater value to customers. Of course, some of the best examples are coming from platform vendors themselves such as this post, “Enterprise Social is about Business Process Redesign” by CEO Michael Idinopulos at Socialtext. But, I’ve seen other examples such as Deloitte’s work in this area explained in this post, “Social Reengineering by Design,” and even examples about how large consulting firms are changing their own internal processes as a result of new ways of working, as evidenced by this post, “Spark – taking Collaboration and Corporate Social Networking to a new Level at PwC.” Luckily, Phil agreed this is an area definitely worth pursuing, so we’ve kicked the study off this week. We’re compiling data and hope to publish results in the early May timeframe.

I’m really happy to be working in this area that combines my long history of covering the traditional outsourcing sector with my area of interest for this current iteration of my career in next generation technologies. Phil has done an amazing job with HfS Research, too, so I’m proud to be contributing to their strong brand in the market. HfS was recently named one of the leading analyst firms in a formidable field of competitors. Last week, I paid a visit to my longtime business advisor Mort Meyersen, who is an icon in the outsourcing field having helped build EDS and then Perot Systems. It feels good to be back among old friends, mashing up what I’ve been learning from new friends.

I will be working hard on this study for the next few months, but also working on the startup we announced a few weeks ago, Change Agents Worldwide. So, busy, busy, but really having fun. Hope to see some of you at SXSW, but I will be hunkered down and only getting out to a few of the evening events. Please keep up with me on Foursquare if you’d like to connect while you’re here in Austin.

Pinch me. SAP is Dreaming up Social for the Enterprise.

With Patel’s new position, SAP recently moved “social” into its cloud group where it will support all SAP suites and concentrations (CRM, for example) in a new social platform that will be structured to support the business horizontally and seamlessly across on-premise and cloud offerings. The group is building what they’re calling, “Project Robus.” (Latin for resolve or purpose.)

This was my 5th year attending SAP‘s gala SAPPHIRE event. You can see from my previous blog posts, a recurring theme in all of them is SAP’s cold shoulder toward all things social.

2008: What I-know-I-don’t-know about E2.0 and SAP from Sapphire ’08

“Enterprise 2.0 is just not a burning issue on the minds of top SAP execs… SAP execs mirror the same sentiment as our executive clients: they have serious businesses to run– not a lot of time for the giddy consumery stuff. SAP software fuels the nitty gritty of hard-core business processes for most of the largest enterprises in the world. Where blogging (for example) fits into getting a raw material through the factory floor to a finished product, booked in inventory and ready to move through a supply chain is just not obvious to me right now. So the likelihood of an Enterprise 2.0 bolt-on to SAP is just as slim as it is naive.”

2009: The S in SAP stands for Systems, not Social

“So, once again, SAP invited me to its annual SAPPHIRE and ASUG event. I find myself wondering if SAP will get return on their investment in me once again. The answer is, probably not… The reality is SAP and its global customer base are just not ready for the socialization of the enterprise. It’s just not a topic that commands attention at this massive event (despite my valiant efforts to bring it up in every executive briefing). The majority of conversations at SAPPHIRE revolve around common themes such as decision-making, analysis, data, spreadsheets, databases, reports, statistics, and business processes. In other words, the real work that goes on in real businesses.”

2010: 2.0 Reality Rehab: SAPPHIRE

“For me, SAPPHIRE presents a unique opportunity to re-calibrate and diffuse the hype chamber that self-perpetuates around the 2.0 phenomenon. SAPPHIRE is the 2.0 Rehab that I voluntarily commit myself to every year for one week. Only at SAPPHIRE do I get an opportunity to see the world the way my Council members do– that the 2.0/social business hoopla is enjoyed and shared by a small minority of corporate professionals. Through the eyes of SAP customers and the SAP eco-system, I gain unique insight into the tremendous task ahead which involves a host of issues, not the least of which is tying 2.0 transformation to the enterprise business processes that run the world’s most successful businesses.”

This year, in 2012, it looks like things might be taking a new turn. At least the lip service is on message. Readers of this blog should know SAP recently hired the #e20 community’s good friend Sameer Patel to assume the position of Social Czar at SAP. Patel has his work cut out for him, however. The two social platforms that qualify as social at SAP are StreamWork and SuccessFactor’s Jam (formerly CubeTree). Two platforms that, frankly, don’t see much social traction in large enterprise. Neither one ever comes up in a landscape conversation of social collaboration software, and turning up examples of hard core users has been pretty slim among those of us who keep an eye on this category. CubeTree, in fact, was never a player. With Patel’s new position, SAP recently moved “social” into its cloud group where it will support all SAP suites and concentrations (CRM, for example) in a new social platform that will be structured to support the business horizontally and seamlessly across on-premise and cloud offerings. The group is building what they’re calling, “Project Robus.” (Latin for resolve or purpose.)

What’s probably most significant about Project Robus is that all development is being led by SuccessFactor’s co-founder and technical cloud guru, Aaron Au. Au is the lead architect and will run engineering for the project. The operating vision behind the socialization of SAP’s massive ENSW footprint hinges squarely on integrating social with business process. As Patel describes it, “This is core infrastructure. It’s like application servers and middleware.” The orientation is on business activities first, and social features second. In other words, use cases will drive how and when social interacts with a business process. All social presentations within the SAP product suite will touch the Robus platform. My blogger colleague Alan Lepofsky describes it as “social plumbing.”

The pressure to deliver social is on SuccessFactors CEO Lars Dalgaard who is the Board executive advocate for social. Dalgaard is breathing new life and new ideas into the software behemoth. He appears to have much support from co-CEOs Bill McDermott and Jim Snabe, as most cloud and social questions asked at the scheduled media/analyst interview were turned over to Dalgaard. There is evidence in the market that SAP has finally embraced the principles of a more collaborative, social business world (see Jim Snabe’s opinion piece in the Financial Times, “Social Networking and the Future of Business“).

I want to believe SAP will pull this off, but there is a small part of me that wants to scream, “You’re doing it wrong!” It’s as if SAP is looking for a software solution to a human opportunity. Focusing on the unstructured data and time spent between workflows is anathema to SAP’s heritage and corporate culture. And even if the executive and management ranks see the opportunity, the rank and file are going to be puzzled. We were sitting at dinner with a number of SAP mentors and I asked if any of them were using StreamWork. All heads shook no. One mentor said he wouldn’t even bother logging on. My enterprise blogger friends roll their eyes when I talk about how social is about reinventing the way we work. But they’re not seeing the changes I’m seeing in large organizations that are successful with social reinvention. Luckily, I’m not the only one talking about this. The enterprise is ready for a different way to work.

But, like Kermit, it’s the lovers, the dreamers, and me. Those of us who are under Social Business’ spell are true believers. I hope Lars Dalgaard and the SAP executive team can execute on the human potential of social, but I’m still a bit skeptical.

See Dalgaard’s “dream” app. Here’s to hoping they pull it off.

Mama Weer All Crazee-Social Now!

Indeed, a Quiet Riot is percolating in the heretofore boring ERP sector. I spotted Josh Greenbaum‘s post on “Enterprise Relationship Planning” this afternoon. In the Council, we have dredged up a 90s label– The Extended Enterprise— to categorize discussions about how our members are architecting their socio-collaborative initiatives to span partners in their supplier, distributor, and delivery chains. Included here is the massive momentum around Social CRM that is touching the customer in personal ways as well and reinventing what it means to be proactive and responsive to existing and potential buyers. One of our largest members recently made a platform selection choice based nearly exclusively on the chosen vendor’s ability to bridge to external collaborators while retaining the ability to keep the conversation secure behind the firewall. All of our members are somewhere in the adoption phase of evaluating these options. The confluence of all SaaS and enterprise legacy systems and social is coming… It’s not if, it’s when.

The unique thread that links the revitalization of all these mechanical, cumbersome, process-driven software “systems” is people. People with intelligence, with tacit knowledge, with “exceptions” expertise. We had a fantastic Council guru Q&A last week with Socialtext’s Ross Mayfield. Socialtext cites a whopping statistic that turns traditional ERP on its head, “An estimated 60 to 80% of an organization’s work is ‘exception’ oriented.” Squeezing the life (variability) out of a process is passe and will be replaced or supplementing with social data to improve its effectiveness, not detract from it. This is a revolutionary idea.

This sentiment is expressed by one of our members, Todd Weidman, who was discussing the rigidity of the Six Sigma process:

“In my experience in financial services, it’s used as a framework to eliminate as much process variation as possible. The processes become repeatable, follow a strict pattern, and ideally you reduce the cost of any transaction (and make it predictable, standard, and outsourcable). That’s fine if your building something to spec (manufacturing), but in any service-based industry, client needs demand many different types of solutions – think financial planning – there may be a number of different inputs for a customized solution. That, of course, requires collaboration between participants.”

Indeed, the future is about relationships. And relationships are about people, not stuff.

Where Business Process Meets 2.0

The 2.0 Adoption Council is experimenting with a range of new market ideas that leverage the power of the social web. The 2.0 thinking surrounding network effects, scale, voluntary collaboration, free (as a business model), and social performance/productivity improvements are just a sample of some of the drivers that have made the Council thrive. Much of these attributes are present in a new concept described recently by John Hagel and John Seely Brown as, “The Collaboration Curve.” Specifically the authors point out, “The more participants–and interactions between those participants–you add to a carefully designed and nurtured environment, the more the rate of performance improvement goes up.” Hagel also describes on his Edge Perspectives blog the move away from a transaction-based economy to a trust-based relationship economy. He refers to as this as a “passionate community.” His words:

In sharp contrast, passion holds the key to creating and shaping relationships that will help us thrive in a rapidly changing world. It motivates even the shyest of us to reach out and connect with others in ways that become catalysts for creativity and growth. Passion fosters a uniquely strong and productive bond that provides both the stability and stimulus needed to continue to grow and succeed in a constantly changing world.

What Hagel is describing is present in the Council today. Simply look no further than the comments from the members themselves on my LinkedIn profile and our testimonials. With this passion, comes business opportunity. The combined intelligence of our early adopter 2.0 membership has become a no-brainer target for vendors interested in harvesting the group wisdom of these world class customers. To that end, we are proud to announce today we have entered into an innovative co-creation research relationship with SAP. SAP announced its 12Sprints public beta today. It’s important to note that 12Sprints is not typical social/collaboration software, but rather a a SaaS-based, goal-oriented, collaborative decision-making tool that incorporates social features such as activity streams, presence, and profile data. The objective for 12Sprints is to draw enterprise data into a conversation where it can be discussed, analyzed, and openly decided upon by geographically dispersed team members.

Although I’ve often been critical of SAP in the 2.0 arena, I’ve always marveled at the “engine” that drives global business on the SAP platform. This first step toward bridging that gap between the core business processes that make the trains run on time and a front-end of 2.0 capability (including integration with various popular 2.0 tools) is a welcome advancement in the maturation of the market. Further, it’s particularly encouraging that SAP would choose the Council to partner on the co-development of this strategic new direction for its blue chip customer base. It represents an unmistakable endorsement and recognition for our business model, the power of our membership, and the promise of innovative alliances to reshape how products get to market.

Below is a Skypecast I did informally last week with SAP SVP Marge Breya that discusses trends in 2.0 adoption and the nature of our relationship.

SAP’s Marge Breya discusses e20 with Susan Scrupski (aka ITSinsider) from susan scrupski on Vimeo.

If Social Media will be like Air, Enterprise 2.0 will be like Carbon

The year I transferred from a small, liberal State college to the ginormous State University, I started the fall semester with a bevy of difficult subjects: Chemistry, Calculus, Introduction to Philosophy, and Abnormal Psychology. When I showed up for my first day of Chemistry, little did I know I had entered the wrong classroom. I was seated in an Organic Chemistry class, not beginner Chemistry. Of course, I made a good show of it– nodding with the professor at different intervals, taking notes, looking confident. Meanwhile, I had no idea what he was talking about and wanted to run out of there screaming. However, I now know that 40 minutes was not a waste. I learned something day one at that class I never forgot. That lesson is that all organic compounds (and all lifeforms on the planet) have one thing in carbon: Carbon.

I was thinking of this random fact the last few days when I read somewhere that Social Media goddess @charleneli was recently quoted saying, “Social Media will be like air.” (Love that, actually.) And also because there’s been a bit of to and fro from the business process stalwarts who have once again found the Enterprise 2.0 conversation to occupy their fancy.

Because (admittedly) I have somewhat of an unfair 50-yard line view of the playing field for Enterprise 2.0 adoption in the work I do for The 2.0 Adoption Council, I feel relatively confident in saying, “If Social Media will be like Air, Enterprise 2.0 will be like Carbon.” I commented to this effect on Zoli’s Enterprise Irregulars re-post of David Terrar’s @DT‘s blog post, although I’m not sure the EI blog is drawing traffic these days.

This is a great post. Read it on @DT’s blog. Totally agree that the bridge between traditional enterprise systems/data/process is the “missing link” in the e20 evolutionary branch of life. Where social will be “like air” as @charleneli says, Enterprise 2.0 will be like Carbon (where Carbon compounds form the basis of all known life.)

But looking at the enterprise through the process prism is not the right perspective, imho. The enterprise of the future will be a social web of connected individuals and teams– innovating, experimenting, verifying, discovering, deciding. The correct view is to analyze the social layer and align process to meet the demands of an ever more productive and innovative workforce.

My friend @sameerpatel has just completed a report, “The Real-Time Enterprise.” Although I have not read this report, I’m fairly certain Sameer and I see the world through a similar lens. I highly recommend you check it out. Enterprise 2.0 is coming. It’s analogous to trying to stop the Internet from encroaching on global trade in the late 90s. In the decades to come, it will permeate every business process, every line of communication, every channel to every member of the eco-system of the Enterprise. Count on it.

What I-know-I-don’t-know about E2.0 and SAP from Sapphire ’08

EIs meet with SAP execs My bad. Sapphire ’08 was an enormous field of opportunity to mine SAP intelligence on what the company is doing regarding Enterprise 2.0 initiatives. Somehow, I missed that opportunity and find myself with a lot of follow-up todos. A group of us had back-to-back meetings with SAP execs both Monday and Tuesday. To be perfectly frank, I learned more about what SAP is doing in Enterprise 2.0 from a product manager on the show floor in a half-hour (thank you Peter!) than I did from any of the executives. This was partly my fault and no-one’s fault, as well. My fault because I could have done a better job of trolling the show floor and no-one’s fault because in the meetings we had, we had a limited amount of time to speak to the executives individually. My EI colleagues had pressing issues on understanding why SAP’s mid-market SaaS solution Business-by-Design is going to be delayed, as well as other issues involving Business Objects, NetWeaver, TCO, cloud-computing, etc. To interject questions on blogs, wikis, RSS and mash-ups just seemed silly and inconsequential to me, so I mostly kept quiet.

Enterprise 2.0 is just not a burning issue on the minds of top SAP execs (with the notable exception of the CMO, Marty Homlish). SAP execs mirror the same sentiment as our executive clients: they have serious businesses to run– not a lot of time for the giddy consumery stuff. SAP software fuels the nitty gritty of hard-core business processes for most of the largest enterprises in the world. Where blogging (for example) fits into getting a raw material through the factory floor to a finished product, booked in inventory and ready to move through a supply chain is just not obvious to me right now. So the likelihood of an Enterprise 2.0 bolt-on to SAP is just as slim as it is naive.

I’m trying to choose my words carefully here because I don’t want to “open my mouth and remove all doubt” regarding my ignorance of SAP’s legacy business or its product roadmap. If you want thorough, interesting, and thoughtful commentary on SAP, please consult with my Enterprise Irregular colleagues who shine in this arena.

What I did uncover about SAP & Enterprise 2.0, however, was pretty interesting and demonstrates that 2.0 e2.0 and SAP technology is working its way into mainstream SAP software, as well as delivering benefits for SAP customers. I, unfortunately, missed a terrific presentation by Andrew Cabanski-Dunning, Director of Product Marketing for SAP NetWeaver. In Cabanski-Dunning’s presentation, “Empowering the User: Enterprise 2.0 Solutions from SAP”, he talks about engaging the user, community virtual workspaces for collaboration, networks connecting peers and experts, searching all business objects, integrating 3rd-party tools and data with open APIs, wikis and web content publishing, mash-ups, flex and ajax, mobile interfaces, and user adoption. All the buzzwords and key concepts are there. I’m going to follow up with Cabanski-Dunning and see if I can get a personal briefing of this presentation and publish what I learn.

On the collaboration front, a number of gems surfaced. The community efforts are truly paying off for SAP. Through communities such as its one-million member strong SDN (software developer network) and BPX (business process expert exchange), SAP is reaping the benefits of an active and engaged co-collaborative community where collective intelligence delivers benefits for all parties. Where ten years ago, customers had to accept SAP’s view of the world, today customers, ISVs, solutions integrators, and partners jointly weigh in on enhancements and features. I heard one statistic that claimed over 50% of SAP’s enterprise services are now developed in tandem with the community. Other communities include its Industry Value Network, the Enterprise Services Community, as well as the many Industry Standards communities where SAP participates.

The most interesting discussion on the use of next-gen technology for me was a show-and-tell with CMO Marty Homlish. Homlish experimented with a virtual marketing community meeting that included 1800 people over 3 days spanning 15 time zones. Using Unisfair (which is like a Second Life for business) and a collaborative workspace called Plexus, SAP marketing employees contributed over 3,000 user-generated content items over the 3-day period. At one point during the trial, 75% of SAP’s global marketing operation were participating in the live event. Incidentally, the Plexus collaboration workspace is itself an example of a co-innovation built for the community by the community as one of the projects in SAP’s Co-innovation Lab. It is a co-development project between Jive Software, Intelligroup, Wipro, Enthiosys and Adobe.

Finally, I did get the chance to ask co-CEO Henning Kagermann about SAP’s internal social networking product, Harmony. He indicated it wasn’t clear yet what they were going to do with it. Harmony is in use by about 2,500 SAP employees including the company’s “high potentials” and select members of its U.S. community. He viewed it largely as an HR offering and indicated it was “not built on SAP technology.” He mentioned it could be a side-by-side offering in the future, but did not commit to a date for commercializing the product. He hinted that collaborative supplier management could be part of the suite, but didn’t go further.

It was clear to me that SAP was not going to be launching a killer app in Enterprise 2.0, but would rather incorporate social networking and collaborative features into its product suites where it made sense and delivered value to customers. So where IBM has Lotus Connections, Microsoft has SharePoint, SAP will be content to patch 2.0 functionality into its core business offerings, but may not uniquely focus in the discrete social software arena.

Oracle, on the other hand, is making a noisy “me-too” in this space. In the past two days, I’ve seen a lot of interesting developments highlighting Oracle’s interest in positioning itself as a player in Enterprise 2.0. To Oracle’s credit, they’ve done an excellent job in communicating the benefits and logical integration opportunities for 2.0 technologies in its core business applications. See Dennis Howlett’s interview with Charles Phillips and this post from JavaOne at the CNET blog which includes a video. I’m working on a briefing demo with Oracle and will keep you updated with what we discover.

I was complaining last week on Twitter about SAP being late to the party in Enterprise 2.0. Having been around the technology business for a thousand years, a(nother) little bird reminded me of something similar years ago in the outsourcing market. It was 1994 and IBM was seeking relief from the Justice Department about lifting its 1956 Consent Decree so it could compete more effectively for large IT outsourcing contracts. At the time, giants EDS and CSC were leading the market. My prediction was that IBM would dominate over time and the reason could be summed up in two words: installed base. IBM proceeded to trounce its competitors and is today the largest services player in the world. Over a decade later, the fundamentals still prove true. SAP may surprise us all.