Kaytek - Mahesh Khatri's ERP Weblog

SAP Software On Demand (Software As A Service)

2007-06-08T20:10:00.000-07:00

Some thoughts by SAP on SAAS (Software As A Service) or Software On Demand (SAP Terminology) as pointed out at their Indian Sub-Continent Summit in Mumbai today are expressed here.

ERP at the Edge of The Enterprise

2007-04-08T21:02:00.000-07:00

ERP is rapidly moving from the core to the edge of an enterprise. More at this link.

Advertising as a Revenue Stream for Software Companies ?

2006-10-11T10:40:00.000-07:00

Advertising could be a possible incremental additional source of revenue for ERP companies besides the traditional ones. There would be multiple revenue streams.

The B2B Advertising Market place in the US itself is in Billions of Dollars. Maybe Google (or any other company) would become the medium for advertising in any software (including ERP).

Online advertising as a variable incremental cost can be measured (perhaps much more accurately than the traditional media) against incremental Sales Revenues, making it more attractive for the advertisers.

The incremental cost of delivering software via the Net is close to zero. There is also a 'long tail' in software revenues that can be utilised more effectively by ERP vendors. Hybrid (Mix of Advertising and other Revenue Streams) Models could be perhaps an interim solution.

One of the advantages of online media over traditional ones is the availability of contextual advertising. Also, it can have multiple forms - ugly, distracting pop-ups that force user response are only one of the possible options.

Also, organizations may have to redefine their definition of users and customers to arrive at more balanced and even more hybrid revenue models.

The 4th Wave as per Forrester - Death of ERP as we know it ?

2006-10-04T12:05:00.000-07:00

George Colony, Chairman of Forrester Research believes that in the next 5 years, large enterprise software (in competition to SAP and others) would become free for corporates largely supported by advertising. This is an extremely outrageous prediction to make.

He also mentioned that Google would be the company driving the same.

He said this in Mumbai today at an event sponsored by NASSCOM.

In Forrester's viewpoint, it is the Executable Internet - the 4th Wave - A Technology Thunderstorm that will cause the same, the earlier three ones being Mainframes, Personal Computers and the Current Web. These waves repeat at intervals of approximately 16 - 20 year gaps.

His presentation had a graph displaying Moore's law growth projections vis-a-vis other curves depicting increase in the technology adoption factors - training, management readiness, education.

Obviously, the graph did support his viewpoints as regards the Wave occurences at timelines with the minimum gap and intersections between the Technology adoption factors and the Moore's law growth line.

Unfortunately, I did not get time to question the source or authenticity of the data in the presentation graphs.

In response to my question, he also replied that it also means as a logical extension that enterprise software ERP companies would become media companies.

Is that not what Google is already today ?

So, should ERP companies brace for innovative business models and tough organizational transformations ahead ?

What about the reluctance of corporate customers to use advertising supported software ?

George's specific reply on the same was that this is the standard reaction of all CIO's and a typical employee already sees hundreds or even thousands of advertisement messages every day during work related PC activities.

SAAS ( Software as a Service) for one third of all of us ?

2006-09-16T23:26:00.000-07:00

At a Salesforce launch in Mumbai last week, a Gartner forecast was quoted that one third of all software budgets in the Asia Pacific region by 2010 would be spent on SAAS applications rather than traditional packaged or bespoke custom software applications.

This trend if true, is a huge inflection point (to quote Intel founder - Andrew Grove) for the software industry globally.

More so for India which has been at the receiving end of IT and software jobs offshored from Western nations (the latest Businessweek article talks of 1.1 Million US IT Jobs being lost during the last 5 years).

Also, we in India have had the advantage (or mis-fortune ? ) of side-stepping entire technology cycles due to late adoption. (.e.g unlike the US, we really do not have a legacy base of mainframe systems as we moved straight into the client-server and PC platforms and are moving also into the mobile computing platforms at a faster pace.)

What would SAAS do to the Indian software, ERP industry and it's huge developer and consumer base ?

Expect many interesting and useful SAAS Indian applications over the next few years (including the ERP area) depoyable over both PC and Mobile Device platforms.

Also, I suspect the above one-third figure quoted by Gartner does not include monetizing of the huge volume of SAAS applications that are used free by you and me as consumers (Google, Yahoo, Hotmail, Blogger and so on).

Is ERP dead ?

2006-08-11T18:00:00.000-07:00

Is ERP dead ?

Perhaps, this link seems to suggest so.

Confirming the ERP Consolidation Trend that we have been writing about on our website since the past two years.

Maybe, it is time for ERP to move out and IERP (Inter-Enterprise and Intra-Enterprise Resource Planning) to take shape, as we have suggested earlier.

Business needs 'Resultants', not 'Consultants'.

2006-06-26T20:29:00.000-07:00

In the original RTE - Real Time Enterprise Paper written by Vinod Khosla, (the eminent Venture Capitalist); he makes a point that what business organizations need from IT are not 'Consultants' but 'Resultants'.

People who can deliver results.

Not just consult.

Also, he has re-affirmed my earlier independent viewpoint of calling ERP by a new name.

Does your organization need a Root Canal Surgery Today ?

2006-06-23T19:19:00.000-07:00

Last Saturday 17th June 2005, at SAP's Business One (B1) Partner Meet in Mumbai, Richard Duffy, Head of SAP B1 in Asia Pacific compared an ERP implementation to a painful root canal surgery.

Earlier, the head of SSA (earlier Baan) (now under Infor) had spoken of an ERP implmentation as a Brain Surgery.

Make your choice.

Does your organization need a Root Canal Surgery ?

Or would it prefer a Brain Surgery ?

Why do ERP implementations need to be so painful ?

ERP's 3 Simple Business Objectives

2006-06-08T10:50:00.000-07:00

General Electric's (GE) CEO - Mr. Jeffrey R. Immelt in his visit to India last week said that his goal for GE in India was to make more money.

Taking a cue from his statement, how does an organization make more money ?

Simple.

By doing one of these 3 things :

First, By Raising Revenues.

Second, By Cutting Costs.

Third, By Satisfying Stakeholders (Owners, Customers, Employees, Suppliers, Regulators and the rest of the communities.)

These 3 simple tasks are really also the business objectives that an ERP system should seek to achieve.

Some more thoughts for C-Level Executives on using ERP systems for achieving the above business objectives.

Beyond ERP ... The EAI Market

2006-03-12T11:54:00.000-08:00

The Enterprise Application Integration (EAI) market follows a logical forward usage trend after ERP implementation in an organization.

Vendors like IBM, BEA, Seebeyond, SAP, Siebel and even Microsoft are playing in this EAI Middleware space.

However, just like the ERP market, the EAI Business will consolidate rapidly as most enterprise customers want inter-operable solutions from their multiple vendors.

Web services, Open Source and Offshore Outsourcing Development will further accelerate this consolidation.

Can your ERP Career be made shock-proof ?

2006-03-08T20:54:00.000-08:00

In a free market which is boundaryless (as on the Net), globalization will always seek to find the best available talent at the lowest cost possible.

For ERP Professionals, there is really no other alternative but to constantly keep shock-proofing one's career from overseas global competitors.

Whether you are in Boston, Beijing or Bangalore, Offshore Outsourcing will make your job vulnerable at some point in time in your career, unless you are globally competitive.

Some Career Resources for Individuals could be of some help.

SAP finally plunges into the ASP space

2006-02-14T18:40:00.000-08:00

As mentioned on this page a year ago, SAP has finally taken the plunge in the ASP (Application Service Provider) space with the launch of it's hosted CRM (Customer Relationship Management) software solution a few days ago.

With it's move, SAP has clearly recognized the impact of Salesforce's business model on the ERP market.

Like the unravelling of the Rubik's cube, the SAP-ASP Jigsaw Puzzle is finally falling in place.

Not too long, before SAP follows the ASP route for the rest of it's application modules other than CRM.

Maybe, today's Valentine Day could be the beginning of SAP's love affair with the ASP market.

Also, makes it particularly easy that the 3 characters S-A-P are just A-S-P re-arranged !!

Switching to SAP ?

2006-01-24T21:10:00.000-08:00

In case you are planning to switch to SAP, these factors may help.

ERP's Eternally Elusive Returns ?

2006-01-23T20:28:00.000-08:00

Organizations do get ROI (Return on Investments) from their ERP Investments.

There are four Broad Types of Incremental Returns
for Organizations from their ERP Investments :

1.0 - Money Returns
2.0 - Time Returns
3.0 - Knowledge Returns
4.0 - Brand Returns

You may get some more brief information on the above
and a 3 step ROI Estimation Process by following this
link.

ERP Returns need not be elusive !!

ERP Software Project Manager's Sandwitch !

2005-12-29T16:33:00.000-08:00

At times, ERP Project Managers find themselves in what I call a Software Project Sandwitch.

They are sandwitched on one hand between their end user customers who are perhaps ignorant of the technical aspects of software and on the other hand by their technical people who are quick to point out problems in the requirements given by the business users.

To avoid the project from turning into a disaster, these Pervasive Percentages might just be the answer !

You have to climb up the Systems Staircase.

2005-12-09T16:55:00.000-08:00

I get many queries from both fresh and experienced software engineers & other graduates who immediately want to jump into the ERP area. Just like
many graduates who want to join MBA B-schools straight from their
graduate college without having atleast a few years of real world
experience.

My advice to them is to have a look at the Systems Staircase.

ERP Systems are at much higher levels as compared to the other
systems at the lower levels in terms of business scope and technical complexity.

You cannot jump intermediate steps.

You have to climb the Systems Staircase, step by step; slowly but surely.

At every level.

Learning the lessons assimilated at lower levels and then only move upwards.

There are no shortcuts.

Also, many young engineers express dismay at having to work with
manual non-automated systems.

Remember, this is WALMART's secret.

Making all their software engineers work on existing WALMART systems
(automated or manual) as end-users before getting them to start
designing new systems.

To get a valuable end-user perspective of the operations.

Are ERP Consultants Delivering Enough Value To Organizations ?

2005-12-07T17:13:00.000-08:00

Most organizations who are implementing ERP find it quite difficult to understand the true ROI (Return On Investment) figures.

For the people who are working on the ERP implementation, their knowledge returns are guaranteed.

But what about the organization ?

Does it get enough value for the high salary ERP consultants ?

As an ERP Consultant, are you delivering enough value to your organization on a daily basis ?

Do you know your Cost To Company (CTC) on an Hourly Basis ?

To find out, click here.

The 3 ERP Career Paths...Updated !

2005-11-24T18:35:00.000-08:00

The 3 ERP Career Paths (Technical, Functional and Industry/Business Specific) Updated on our website !

Microsoft's 3-4-5 Strategy to ride the waves of the rough changing 'Technology Seas' ?

2005-11-17T13:35:00.000-08:00

Bill Gates has mentioned about a 'Sea Change', a massive coming disruption in the global Technology Landscape.

I had earlier written about Microsoft's 3-4-5 Strategy to integrate their ERP and other Office Productivity applications.

It envisages 3 elements of Microsoft's customer Model, 4 Customer wants and 5 horizontal attribute requirements.

Can some other competitor beat them in their 3-4-5 Strategy and ride the rough waves of the Technology Sea Change ?

When will Indian sweepers use ERP powered, Mobile Delivered solutions ?

2005-11-01T13:50:00.000-08:00

When will Indian sweepers use ERP powered, Mobile Delivered solutions effectively ?

Last week at NASSCOM's Mobile Application Seminar in Mumbai, Mr. Pradip Baijal Chairman of TRAI (Telecom Regulatory Authority of India) mentioned about how in South Korea he had seen a sweeper in a five star hotel use her mobile phone to check stock market prices.

Today on my way to office, I saw an autorickshaw driver recharge his mobile
phone by paying Rs 200 (Approximate 4.45 USD) for an effective talk time of
Rs 50 (Approximate USD 1.11). His only query was to how long he could keep receiving free incoming calls.

India's mobile revolution is truly sweeping India's ABCD population.

ABCD is an acronym used by one of the speakers at the above seminar. It stands for Aaya, Bai, Chowkidar / Carpenter , Driver.

(Aaya, Bai, Chowkidar mean Maid, Servant, Security Guard respectively in Hindi).

Truly, dropping mobile rates have made accessibility for Indians more and more affordable and creeping in as a lifestyle even at lower economic levels.

The time is for high-end ERP powered solutions to be made mobile aware so that even in India, the road side municipal sweepers and rag-pickers can perhaps check stock prices from their mobile phones. As in South Korea.

Imagine the huge impact it would have on India's service sector productivity.

ERP solutions have to be scaled up to deliver extremely high volume mobile
device interface driven queries and transactions from Millions of India's
mobile users.

That is the next Big challenge for ERP Vendors and ERP Implementation
Consultants.

The Twin IA/AI Mindsets hampering ERP implementations.

2005-10-17T13:05:00.000-07:00

Can the Attitudinal Behaviours of End Users and Technical People cause ERP Implementations to fail ?

A twin set of attitudinal behaviours in people (both End-User Customer
and Technical-ERP Persons), at times causes problems in ERP projects.

I call these as the IA/AI attitude problem sets.

Broadly these are characterised as :

- Amongst the Technical People, 'Intellectual Arrogance' - the 'IA' mindset.

An attitude amongst many technically-proficient people of assuming that contributions from non-technical people need to be ignored only because of their lack of technical knowledge and/or academic qualifications.

Key Issue to tackle the 'IA' mindset - How to ensure that ERP technical people exhibit more humility and are open to suggestions from non-technical end-users ?

- Amongst the Non-Technical People, 'Abstract Ignorance' - the 'AI' mindset.

An attitude of reluctance of changing mindsets or perspectives towards their own work behaviour or job learning skills. Also reflected in deep distrust of ideas, inputs from technical people.

Key Issue to tackle the 'AI' mindset - How to address fears of non-technical people in a better fashion ?

These twin attitudinal behaviours have contributed to a large extent in non-implementation or delays in ERP projects.

Only crisis-situations seem to cause changing of the above mindsets, which are hugely negative factors which cause ERP (and also other IT) project delays and distress in the workplace.

Any inputs on how to tackle the above (especially the first one) would be most welcome.

PS : Incidentally, IA and AI are also acronyms for the earlier long troubled (atleast from passenger perspectives) Indian aircraft companies - Indian Airlines and Air India respectively.

5 Golden Steps for Evaluating ERP Solutions

2005-10-12T12:15:00.000-07:00

One of the speakers (sorry, did not write down his name) at a SAP seminar, listed the below 5 golden steps for evaluating ERP solutions :

Step 1 - Do Homework Right. Evaluate Needs, Requirements. Compare the Different solutions available. More the Gaps between your needs and available solutions, more costly would be the customization.

Step 2 - Contract Negotiation. Fixed Costs Versus Time and Materials and Flexibility. Check References.

Step 3 - Limit Customizations since these are directly proportional to costs.

Step 4 - Address Key Functional Issues.

Step 5 - Address Key Technical Issues.

Is Microsoft relevant in High-End Enterprise ERP Installations ?

2005-09-26T16:15:00.000-07:00

I had earlier written on the joint project of Microsoft and SAP.

Someone queried about Microsoft's importance on the enterprise ERP scene.

>If the MS Databases are so important, how come most SAP & Oracle
>Financials instances are running Oracle Database Engines rather than MS
>SQL Server ?

SAP ERP perhaps due to legacy.

SAP was founded in 1972. Oracle in 1977. MS Sequel Server was released in 1988.
(a clear decade behind in terms of calendar period).

Oracle Financials run Oracle Database Engines as part of an upward Software Stack Integration Strategy in the Software Layers Framework.

>If the MS Operating Systems are so important, how come most SAP & Oracle
>Financials instances are running Oracle on a flavour of Unix rather than
>Windows ?

Perhaps, the same legacy reason.

To the best of my knowledge, UNIX also had atleast had a couple of decades lead in operating systems compared to Windows.

>Show me a High End ERP (High End = SAP & Oracle) site and I'll show you
>a Unix/Oracle Configuration.

I am not too sure.

As per this link,

...."Microsoft Windows retained 51.3%, and UNIX settled at 41% of the
cumulative global market share for operating systems of SAP customer
production system database servers at the end of 2004. These two OSs
dominate the worldwide SAP customer base, and remain their low-risk
preference. .....

Also, as per today's prediction by a Gartner Vice-President in the local newspapers here, only Microsoft and LINUX will remain dominant operating systems after 5 years.

Is Oracle turning Software Acronyms into Disappearing Dinosaurs ?

2005-09-16T08:20:00.000-07:00

What would he future Oracle (after digesting Siebel + iFlex + Peoplesoft and some more....) be possibly known as ?

An ERP + CRM + DB (Database) Company ?

Or just a (Plain Old) Software Company ?

Like our Plain Old Telephone Service (POTS) Utility Company !

The Commoditization of the Enterprise Software Space continues !

Causing Software Technology Acronyms to disappear like dinosaurs !!

Welcome to IT as a Utility.

Is Industry-Specific Knowledge a Must for ERP Solutions ?

2005-08-16T18:37:00.000-07:00

Most customers implementing ERP solutions prefer to work with ERP Implementers who have specific experience of their industry vertical.

This approach may also has it's disadvantages.

Many times industry-specific knowledge consultants may perhaps miss the 'Big Picture'in considering generic business processes across industries.

In my humble opinion, out-of-the-Box innovative thinking specially for 'Strategic Solutions' sometimes comes from People outside one's own industry who are not perhaps constrained by the narrow confines of their specialized 'industry knowledge'.

At a time, when all industries are undergoing radical transformational shifts, too much industry specialization could perhaps be a bottle-neck, rather than a boon.