Posts Tagged 'SAP'

Megavendors, Cloud Judo, and The Innovator’s Dilemma

dcunni:

Back in 2007 Ken Rudin, CEO of the early stage SaaS BI start-up called LucidEra (and former Siebel employee) was asked about the cloud announcement from Business Objects (before they were acquired by SAP).  He made a number of observations about the challenges enterprise software companies face when it comes to transitioning to the cloud. Here’s the interview.

Today, Dave Kellogg wrote a great post about Oracle’s series of cloud announcements this week. I’ve re-blogged it here.

Originally posted on Kellblog:

It’s an interesting time in cloud evolution.

  • Oracle missed their fourth quarter targets, for the third time in seven quarters, with many observers worried that cloud missteps were a root cause.  Buying Sun when the world was going cloud was a rare Oracle zig when the market zagged. To take Wall Street’s eyes off the 4Q miss, Ellison promised some startling announcements in the coming week, a great diversion if there ever was one.
  • Oracle then announced a nine-year strategic partnership whereby Salesforce will continue to run its technical operations on Oracle’s database, purchase Financial/ERP and HCM software from Oracle (presumably dropping its existing Workday implementation), and the two companies…

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SAP’s Cash Cloud – Can The Mega-Vendors Become What @Benioff Calls Cloud People?

Image representing SAP as depicted in CrunchBase

Image via CrunchBase

Congratulations to my friends (and family) at Ariba…and welcome to SAP! While some are suggesting that the $4.3 billion buyout is really all about the transaction network, clearly Ariba’s strategic direction to transform into a cloud company is what drove the acquisition. As SAP (and others) continue their cloud spending spree, I wanted to highlight a few points made recently by Informatica’s Juan Carlos Soto, General Manager of Informatica Cloud, in an SIIA interview about the new era of Hybrid IT.

When asked about the mega-vendors buying pure-play SaaS companies and whether or not these acquisitions will succeed in helping them become what Marc Benioff calls Cloud People, he had this to say:

The past few months have seen at least four major acquisitions in the SaaS space by mega-vendors. For several of these mega-vendors, these moves represent a major course reversal as they are dragged into the Cloud. Despite the positive claims in the news, these acquisitions will pose major challenges to integrate and for the foreseeable future will likely remain as separate stand-alone businesses. The acquiring companies will also face difficulty to rationalize their product portfolio and explain to their customers when to buy which solutions.

A good question to ask is why these acquiring companies, with their seemingly unlimited access to leading technology and large pools of talent, failed to build Cloud versions earlier. From Informatica’s vantage, many successful companies are saddled with what Clayton Christensen famously calls “The Innovator’s Dilemma” – their focus on near-term license revenue targets and fear of cannibalizing their highly profitable product lines ties their hands from being able to make the necessary investments on disruptive, but necessary innovation.

Moreover, it takes more than just technology to become a successful Cloud vendor. Cloud requires different sales, marketing, financial and accounting, and support models than the mega-vendors’ existing competencies. In addition, while these mega-vendors generally have large services arms and deep experience hosting applications for their customers, this does not necessarily qualify them to operate multi-tenant cloud services.

The irony is that it is often easier to make an acquisition, at least from a finance perspective, than it is to fund the incremental hiring and upfront investment ahead of revenues needed to become a Cloud vendor. A key advantage from these SaaS acquisitions is that they come with Cloud sales, marketing, support and operations experience, along with established routes to market, to help the mega-vendors start to catch up and if properly integrated, to inject the Cloud mindset into their DNA.

Solid points indeed! It’s going to be interesting to see if SAP (and the other mega-vendors) can Escape Velocity. Either way, I’d strongly recommend that the executives at these companies take the time to read Geoffrey Moore’s latest book.

The interview with Informatica’s Juan Carlos Soto goes on to discuss the factors that are driving the mega-vendors to buy pure-play SaaS/Cloud vendors. You can read it here.

A Not So Anti-Social Enterprise IT Message

I attended Cloudforce San Francisco last week and was quite impressed with how the Social Enterprise message has been refined and strengthened since Dreamforce. As always at a Salesforce event, top customers were in the spotlight, telling their stories about the business impact of CRM applications and the Force.com cloud platform. What was different at this Cloudforce was the representation from senior levels of IT on the main stage and the focus on the importance of cloud integration to Social Enterprise success.

Check a couple of these headlines and quotes:

Salesforce.com Makes Friends With CIOs

“Benioff is sounding uncharacteristically cautious as he lays out his expansion plans because the enterprise door, formerly shut, is opening to Salesforce’s SaaS approach. And instead of the sales staff, now it’s the IT leaders often who are the ones opening it.”

A Barb-less Benioff? Salesforce.com Grows Up

“Rather than blasting Oracle (ORCL) as a ‘false cloud’ provider or taking swipes at SAP as a dinosaur, CEO Marc Benioff extended olive branches to those rivals. In his keynote, he talked about ‘coexisting’ with those companies, stressing the need for ‘deep integration’ between salesforce.com’s products and the widely deployed software.” 

Here’s the @benioff’s Cloudforce keynote:

 

Video: Unlock your SAP Back Office with Force.com

This Salesforce.com demonstration  is a great example of the power of cloud integration.

 

Salesforce Integration @Dreamforce #DF11 Webinar

The Informatica Cloud team hosted a webinar after Dreamforce 2011 to review the topic of cloud integration and share some of the insights from event. We also jumped into a comprehensive demonstration of Salesforce data integration in action. Here’s the recording:

SAP, meet Force.com #socialenterprise

Image representing Force.com as depicted in Cr...

Image via CrunchBase

Last week salesforce.com launched a new campaign targeted at SAP customers: “Unlock your back office and become a social enterprise.” The message is clear – build a layer of agility around your legacy ERP system and immediately increase the business value of your existing investment.

SAP, meet Force.com…

How is this possible, you ask?

“By unlocking and extending the data trapped in your SAP ERP deployment with mobile and social apps built on Force.com.”

The campaign clearly highlights the benefits of establishing the right cloud integration strategy early. It also highlights specific cloud application integration and data management partners, which is nice to see.

Here’s a presentation outlining some of the considerations, best practices as well as an Informatica Cloud demonstration of SAP and Salesforce integration. I’ll also be hosting a webinar this week that will focus on Oracle EBS integration with salesforce.com. Clearly cloud integration is in the spotlight.

Integrating Salesforce CRM and SAP

SAP AG

Image via Wikipedia

Here’s a video of Informatica Cloud integrating Salesforce.com data and SAP.


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