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Quark Summary: Does SAP HANA Change Your Database Strategy for SAP Apps?

Published on April 18, 2012 by R "Ray" Wang

Forward And Commentary

SAP’s made big claims about HANA and its capabilities today and into the future.  This Quark goes into the details and Constellation’s point of view.

A. Executive Summary

Both HANA as an architecture and database alternative indicate SAP’s future direction and next-generation approach. Consequently, numerous clients and SAP customers have inquired on whether or not they can replace their underlying Relational Database Management Systems (RDBMS) in their SAP Business Suite with HANA. Constellation believes SAP HANA is a critical technology that SAP customers should evaluate and understand as the roadmap reveals itself. This report primarily describes the role HANA will play for use with SAP Business Suite and in future SAP applications.

B. Research Findings

Since 2008, SAP has hinted at a real-time data platform approach to its middleware and application infrastructure based on the power of in-memory database (IMDB) technologies. IMDBs are a database management system that stores data directly onto the main memory of a computer. In an IMDB, the memory resident data has one minimum backup copy on disk, but the primary copy lives permanently in memory. Traditional on-disk databases cache data into main memory for access but the primary copy permanently lives in storage.

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News Analysis: The Implications Of Oracle’s Acquisition Of Taleo

Published on February 9, 2012 by R "Ray" Wang

Catch my colleague Yvette Cameron’s point of view here. She covers Future of Work for Constellation Research, Inc.

Oracle Plays Catch Up With Public Cloud Ambitions

On February 9th, Oracle announced its intention to acquire Dublin, CA based Taleo for $1.9B.  Taleo is a cloud based talent management software provider with 5000 customers and 1400 employees.   Key take aways to consider:

  • Moves by SAP and Oracle intend to compete with next generation cloud HCM companies. Taleo provides recruiting and on boarding, performance management and goal setting, compensation, succession, and learning and development.  This complete suite tied to reporting and analytics is designed to streamline human resource operations and employee career management across retail and hospitality, travel, healthcare, media and entertainment, financial services, technology, and energy and mining.  Marquee customers include Starbucks, Starwood, Hyatt, JP Morgan Chase, HP, Dell, Conde’Nast, United, American Airlines, Tesora, Blue Cross blue Shield, and Sutter Health.to customers.

    Point of View (POV):     Oracle sees advantages in acquiring a leading player in the talent management space .  For years, both Taleo and SuccessFactors ate into Oracle’s existing customer base for talent management.  Consequently, other cloud based HCM and HR Tech vendors such as Ceridian, CornerStone OnDemand, FairSail, Kinexa, UltimateSoftware, and Workday continue to attract line of business customers looking for innovations not being delivered by their core HCM providers (i.e. Oracle, PeopleSoft, SAP).  More importantly, cloud computing if properly designed can improve the pace of innovation delivered to customers.
  • Oracle continues to buy its way into a public cloud. Oracle continues to react to buyer sentiment and preference for cloud based solutions with this second major acquisition in what they term the “public cloud” space.  Oracle purchased RightNow for $1.43B on October 24th to address its gaps in customer service solutions.  The Taleo purchase addresses a gap in Talent Management solutions that rival SAP plugged with its recent acquisition of Success Factors for $3.4B .

    Point of View (POV):     These defensive plays indicate a realization that Cloud delivery emerges as the predominant option for applications. Based on Oracle’s current road map, one can expects Oracle to acquire its way into many other edge applications not listed on its Public Cloud road map (see Figure 1).  Some other applications could include social business solutions, expense management, learning solutions, pricing management, identity management, and mobile device management.   However,  Oracle’s public cloud acquisition strategy so far lacks a key requirement – a choice for multi-tenant architected solutions.  While both RightNow and Taleo have some modules that are multi-tenant, in most instances, these applications have been delivered in single tenancy or in multi-instance. Multi-tenant solutions will provide clients with the most efficient upgrade path and lowest long-term cost structure.  The lack of a public strategy to address this issue remains a significant concern for customers and industry observers.

Figure 1. Oracle’s Vision For A Public Cloud

Source: Oracle Corporation

 

  • Seats matter most in a world of CoIT. Oracle hopes to gain massive cloud scale through Taleo’s 74 million transactions per day and 240 million candidates on Taleo Talent Exchange.  The sheer number of users is massive.

    POV:     Unlike CRM or ERP, the play for HR is all about acquiring the biggest base of users – employees.  With consumerization of IT (CoIT) in full swing, the goal is to grab as many users upfront and then over time cross-sell them into other edge applications which converge between enterprise and consumer.  Why?  The new strategy among the enterprise apps vendors is land and expand. The largest active user bases will win the war of attrition.

The Bottom Line for Customers: Goodbye On-Premises, Hello Cloud World!

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Vendor Event: Workday Predict And Prepare 2011

Published on December 3, 2011 by R "Ray" Wang

Title: Workday Predict And Prepare 2011
Start Date: 2011-12-07  11:00 am PST
End Date: 2011-12-07   12:00 pm PST
Location: Webinar Link

For the fourth year in a row, join the country’s top IT, HR and Talent Management analysts and consultants for their predictions of next year’s critical trends, plus their advice on how you should prepare for them.
Their predictions include

  • SaaS becomes mainstream, and IT’s job becomes integrations
  • Companies will “rip and replace” legacy systems even faster than before
  • Self-service will become social, mobile and more gamified
  • Talent Management as a separate software category will disappear
  • Mobile will soon become employees’ first contact with enterprise software
  • Companies will do Master Data clean up in order to do Analytics

    • Sponsored by Workday, Predict and Prepare features Knowledge Infusion CEO Jason Averbook, HR technology guru Naomi Lee Bloom, and R “Ray” Wang, Principal Analyst and CEO of Constellation Research.

    Their roundtable is moderated by Bill Kutik, host of The Bill Kutik Radio Show® and Firing Line with Bill Kutik, technology columnist for Human Resource Executive® and co-chair of the magazine’s 15th Annual HR Technology® Conference & Exposition.

    Your questions will be addressed throughout the discussion.

    Register here!

    Disclosure

    Although we work closely with many mega software vendors, we want you to trust us. For the full disclosure policy, stay tuned for the full client list on the Constellation Research website.

    Copyright © 2011 R Wang and Insider Associates, LLC All rights reserved.

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    News Analysis: Infor Launches New Era With Infor 10

    Published on September 26, 2011 by R "Ray" Wang

    After 11 months of behind the scenes work, CEO Charles Phillips and the Infor management team unveiled the launch of Infor 10 in New York City on September 13, 2011, to customers, industry analysts, media, and investment analysts.  The new Infor has kept busy with key management team hires, the $1.84 B acquisition of Lawson, the launch of Infor10 CloudSuite, and partnerships in CRM with Salesforce.com via Inforce.

    Infor currently serves more than 75,000 customers in 164 countries. With combined revenues greater han $2.5B, Infor/Lawson is the third largest enterprise apps company. The Infor and Lawson combination brings deep industry presence in key industries such as aerospace, automotive, chemical, distribution, equipment service maintenance repair (ESMR), fashion, food and beverage, general manufacturing, healthcare, high-tech, hospitality, high tech, industrial equipment and machinery, industrial manufacturing, and public sector.

    Key announcements from the September 13th launch event include:

    • Reintroducing ION as the ‘the heart of Infor10. Infor’s lightweight middleware solution provides an integration tool for Infor and non-Infor applications. The intent is to provide devices such as desktops, tablets, and other mobile devices to gain access to information in existing applications. Key components behind the technology infrastructure include a common user interface, workspace, reporting and analytics, workflow, event management, master data management, localizations, mobility enablement, and packaged integration.

      Point of View (POV):       Unlike Oracle and SAP who have spent billions addressing the integration problem through a comprehensive and heavy middleware strategy, ION take a more pragmatic approach. Through loose coupling, Ion gives the Infor family of products increased agility that matches use cases for a mobile, social, and analytical world. While ION aims to provide better integration, streamlined workflows and end to end business process integration, Constellation believes it will take at least 6 to 9 months before the first set of end to end processes span across the major product lines (e.g. Infor10 ERP Enterprise (LN) and Infor 10 Lawson M3).  The good news – Integration between Infor10 Lawson S3 and Infor EAM is planned for November, just 100 days after acquisition.
       

      On the management team side, customers and prospects will be reassured that both Infor’s second employee, Soma Somasundaram, senior vice president of Global Product Development and Dean Hager (i.e. originally from Lawson) remain key driving forces for carrying out this completed vision.

    Figure 1. ION Plays A Key Role In Infor’s Long Term Strategy


    Source: Infor

    • Delivering a consumer grade experience. Duncan Algove, President of Products and Support introduced Infor10 Workspace. With an intention of bringing consumer world experiences to the enterprise, Infor10 WorkSpace provides a fresh start to helping users “work the way they live”. Key elements of the ION experience include role-based screens, role-based workflows, in-context business intelligence, event management, activity streams, tasks and alerts, and consumer-like search capabilities).

      POV:       Existing customers and new prospects expect next generation applications to meet the Six S’s of Enterprise Class Consumerization of IT. Infor’s key design principles of flipping the structure of work to be data and event driven, contextual data at the point of decision, social computing metaphors, and design for mobile play a key role in making this a reality for Infor customers. This provides a compelling reason for customers to put their maintenance fees to use in an upgrade or purchase of Infor10 components.

    Figure 2. Scenes From The New Infor User Experience

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    Event Report: SAUG Summit 2011 Attendees Show A Shift From SAP Centricity To Purpose Built

    Published on August 3, 2011 by R "Ray" Wang

    Summit Brings A Cadre Of Thought Leaders To User Group Attendees


    The SAP Australian User’s Group held their annual summit once again at the Sydney Convention Centre in Darling Harbour from August 2nd to August 4th.  With around 600 attendees, the keynotes covered many of the hot topics about SAP ownership, road maps, and best practices. Some highlights include:

    • Christian Thompson, Director of Information Services at CITIC Pacific Mining discussed their experiences with growth and to go cloud or not.
    • Jeff Word, Vice President of Product Strategy at SAP shared the latest SAP Technology strategy in his keynote and delivered a standing room only, four hour deep dive, on HANA that was a must attend event.
    • John Kelvie, IS Director at Fonterra outlined how their company replaced legacy systems with SAP for a future SAP road map. John provided detailed examples of what worked and what didn’t.
    • Bridgette Chambers, CEO of the America’s SAP User Group (ASUG) introduced the concept of Infinite ROI. She expressed how to take advantage of timeless software.
    • Malcolm Humphries, BI Solutions Architect at Fonterra; and Keith Murray, Global Product Manager for SAP In-memory computing at IBM shared real-world experiences of how BWA can be deployed and the realities of the SAP’s new HANA in-memory product. This session blew away most marketing fluff presentations at Sapphire 2011 this year.

    In addition, breakout sessions focused on industries, solutions, business/analytics, and IT organization/Technology, and BOBJ.  Of particular interest was the excellent session put on by Peter Dee, Head of Upgrade Centre, SAP Asia Pacific Japan. He provided some pragmatic approaches to managing cost effective upgrades.

    Meanwhile, the mobile sessions, BI sessions, and solution manager sessions received a lot of attention.  Of note, Australian SAP Mentors Matt Harding, Paul Hawking, Ingo Hilgefort, Nigel James, John Moy, Graham Robinson, and Tony de Thomasi were in attendance providing their wisdom and insights throughout the event.

    Australian SAP Users Upgrading But Moving Away From SAP Centric Strategy

    Traditionally an SAP only and SAP centric market, conversations with attendees confirmed a significant shift in approach.  Cloud computing, mobile enablement, business pressures, and the need to align with business strategy have driven many Australian SAP customers to stray away from a single vendor approach.  For instance, on the mobile side, SkyTech’s offerings show good penetration.  For collaboration solutions SharePoint and Yammer appear to have gained mind share.  CRM remains dominated by Salesforce.com and Microsoft CRM.  Analytics discussions include Business Objects but IBM Cognos, Oracle Hyperion, QlikTech, and other cloud based solutions show significant presence in conversations.

    During the Future of Enterprise Software and SAP keynote, an informal poll of the 650+ attendees revealed the following SAP strategies (see Figure 1):

    • Stay with status quo: 15%
    • Move to shiny new SAP: 20%
    • Stabilize SAP and augment: 25%
    • Modernize SAP and surround with best of breed: 40%

    Figure 1. Four Paths To SAP Optimization

    With 65% of the respondents considering solutions outside the SAP sphere, SAP HQ should take note that the Fortress SAP approach no longer holds true in ANZ.  The good news – 60% of respondents have made the decision to upgrade to the latest SAP products and remain interested in having SAP as part of their long term strategy. SAP remains in good relationships with its key customers. While customers do see SAP as a core part of their strategy, it is not the only strategy.

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    Quick Take: Infor and Golden Gate Gain Definitive Agreement To Acquire Lawson For $2B

    Published on April 26, 2011 by R "Ray" Wang

    New Firm To Focus On Verticals And Growth Markets

    Golden Gate Capital and Infor entered an agreement to acquire Lawson at $11.25 per share.  The transaction is valued at $2B. Following the 7am ET press release,  a conversation with Charles Phillips and Duncan Angove highlighted key elements of the deal:

    • Focus on growth. Infor sees an opportunity to cross-sell products from both companies into the existing 75,000 customer install base.  Lawson’s HCM product line and Infor’s new release of Sun Systems Financials will provide the back office engine that was missing as independent companies.  The firm expects two-tier financials to be a growth opportunity.
    • Commitment to vertical differentiation. Infor’s trengths in distribution, manufacturing, and hospitality will complement Lawson’s core in healthcare, financials, equipment service rental, and public sector. Charles and Duncan both provided compelling examples of how products from both companies could be used to solve industry problems such as nursing shortage and asset management in healthcare. Time and attendance, planning, scheduling, and analytics would come together to solve a difficult customer problem.
    • Investment in integration.  The combined firm intends to focus on bringing applications together through integration.  Initial thoughts are to achive a common customer experience.  The engineering teams will begin with aligning ION to Lawson Process Platform. The goals – ensure that the common user experience layers are delivered adn bringing together common integration points.

    More to come later in the day.

    Your POV.

    Does this announcement surprise you?  Are you a Lawson customer?  What do you think of an Infor takeover?  What do you hope Lawson will do? Add your comments to the blog or reach me via email: R (at) ConstellationRG (dot) com or R (at) SoftwareInsider (dot) com.

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    Event Report: The Sentiment At Microsoft Convergence 2011

    Published on April 10, 2011 by R "Ray" Wang

    Refresh Cycle Reflects Bullish Outlook By Partners and Customers

    Microsoft Convergence kicked off over the weekend in Atlanta, GA at the Georgia World Congress Center.  With an anticipated increase in attendance, many new product announcements, and a technology refresh cycle in play, attendees seemed upbeat.  The event kicked off in true tradition including the must attend Randy and Andy (IBIS, Inc) welcome party.  Anticipated cloud announcements, new features, and industry extensions dominate discussions among partners.  Through a survey of over 60 customers, we found the following observations:

    • Customers expect to upgrade ERP and CRM in 12 to 18 months. Good news for Microsoft partners.  Most ERP and CRM customers plan to upgrade within the next 12 to 18 months (see Figure 2).  Many plan to upgrade ERP (18.0%) and CRM (13.1%) in the next 6 to 12 months.
    • Cloud adoption remains partly cloudy. While there are numerous benefits to cloud adoption for clients,  34.4% of ERP customers showed no interest.  Most CRM customers expected to make the shift to the cloud (see Figure 3).  As for the shift to office in the cloud, 18.0% planned to make the shift 24 months from now.
    • Attendees seek to leverage Microsoft investment. Informal conversations highlighted interest in mobile development, greater sharepoint adoption, and interest in Power Pivot.  Most customers felt Microsoft had turned the corner and began to innovate as of the Windows 7 launch.
    • Large customer prospects explore Two Tier ERP. In speaking with 13 divisions of large enterprises at the event, most attended to explore the option of adding Microsoft Dynamics ERP into their subsidiaries.  Eight of the ten companies ran SAP while three ran Oracle, and another two ran custom legacy systems.  Surveyed prospects believe that Two-tier ERP strategies will dominate future apps strategy.

    Figure 1.  Flickr Feeds From Microsoft Dynamics Convergence 2011

    (Tag your images with #softwareinsider or #rwang0 to include into the feed)

    Figure 2. Most Microsoft Dynamics Customers Plan To Upgrade ERP & CRM In 12 to 18 Months

    (Right click image to expand)

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