August 14th, 2008 · Posted by Mark Palony · No Comments
If we are to believe the daily media reports, the economy is either in a recession or perilously close to slipping into one. If this is the case, one has to wonder why ERP spending continues to rise. SearchSAP.com gives us part of the answer in this post.
Quoting Jim Shepherd, a vice president at of AMR Research, SearchSAP.com points to two primary drivers of growing EPR spending: SMB’s survival instincts and more companies becoming global.
I entered the ERP space on January 17, 2000. At the time ERP publishers were coming off the high of the Y2K scare and the economy was moving into a recession. As I recall, IT spending was predicted to stay constant if not be slightly reduced. Contrast that with what AMR is saying now and I’m left wondering why spending expectations are different today under what appear to be similar economical circumstances.
Shepherd mentioned two, I’ve offered four additional possibilities below:
1. Economic growth has slowed, but we have not entered a recession - regardless of how it “feels” - so companies are moving forward with their IT plans.
2. We have entered a recession, but companies are more sophisticated today and see IT as a strategic investment that offers a quantifiable return by streamlining processes and increasing efficiencies.
3. Many of the SMB’s who bought new systems during the gloom and doom talk preceeding January 1, 2000 have, eight years later, outgrown those systems and the hardware has become obsolete.
4. The links in the supply chain are becoming increasingly connected. A SME supplier to a larger enterprise is no longer electronically autonomous. EDI, RFID, etc. have dramatically changed the way companies up and down the chain communicate and if you don’t keep up, you don’t stay in business.
So many factors can impact the economy - the November election, Russia and Georgia appear to be heading toward a fullscale war, terror attacks on US soil are always a possibility - that what was is called a study can more accurately be called a poll. A snapshot in time, based on current circumstances, that could turn 180 degrees in the next 24 hours.
It’ll be interesting to look back a year from now and see how accurate AMR’s proved to be.
August 6th, 2008 · Posted by Mark Palony · No Comments
I saw this post at the insights Four51 blog the other day. Like SoftBrands, Four51 has a software solution that integrates to SAP Business One. But where SoftBrands focuses on manufacturing, Four51’s solution is specifically for the printing industry. I won’t speak to how good the product is, but if SAP has signed Four51 as a Software Solution Partner it meets some pretty high standards.
This post isn’t an endorsement of Four51’s solution for SAP Business One. I am, however intrigued by the circumstances they find themselves in. I’m intrigued because we (SoftBrands) were in the same situation just a few years ago.
We launched our FourthShift Edition product in April of 2005 as a manufacturing extension for SAP Business One. We’ve been in the manufacturing ERP business since 1984, but that didn’t matter much to the early prospects. In fact, most early prospects focused on one of two things. The first group couldn’t get past the fact that they were looking at a new, unproven manufacturing software. The other look beyond the the product. They focused on the fact that SAP had selected FourthShift Edition as a manufacturing extension and decided the upside of partnering with SAP was worth the risk.
Today, just a few years after the launch of that product, SoftBrands is one of the highest revenue producing Software Solution Partners in the SAP ecosystems, we have a seat on the SAP Business One product development committee, we were recently announced as a partner in SAP’s new MegaChannel initiative, and we are implementing FourthShift Edition for SAP Business One in companies across the globe. From stand-alone enterprises to subdisiaries of Fortune 500s SAP Business One and FourthShift Edtion are helping companies improve their operations.
My bottom line is this: Sometimes a partnership is worth it, even if it comes with a little more risk than the alternatives.
There are hundreds of Microsoft Millionaire who’ll back me up on that.
July 25th, 2008 · Posted by Mark Palony · No Comments
It’s been too long since I’ve posted and have nothing to blame it on other than time, or lack thereof.
This item from the IT Failures Blog at ZDNet came to me via Twitter. Michael Krigsman, the IT Failures blog blogger, picked up the story from ZDNet’s Larry Dignan. Larry is Editor in Chief of ZDNet and Editorial Director of ZDNet sister site TechRepublic and wrote a Wednesday post about the B&L shake up on his Between The Lines blog.
If one can re-tweet, I assume re-blogging is also acceptable so here goes.
The bottom line of the story is that B&L has decided to roll customer service under one person. Writes Larry Dignan: [Bausch & Lomb] named Alan Farnsworth, senior vice president of customer service and information technology and chief information officer.
Michael Krigsman looks at the positive side of such a move:
[B]y bringing together IT and customer service under one roof, Bausch & Lomb creates stronger connections between two critical information-related functions. Eliminating the boundaries creates tremendous opportunity for the company to bring strategic IT to bear on customer service. That’s got to be good for customers and therefore great for Bausch & Lomb.
Considering there are two sides to every coin, I’d like to turn this one over and look potential pitfalls.
I have no doubt that Customer Service gathers and stores more information than any single B&L department, if not all others combined. Also, if SoftBrands is any gage, I’m convinced their CSRs spend more time in the CRM system than accounting in theirs, sales in theirs, etc. None of this convinces me, however, that putting the Customer Service department under the direction of the CIO is a good idea…for any company.
Customer Service is just one of several functional areas requiring support from IT, its people and systems, but making it part of IT sends a message that the other departments do not rise to the same level of importance. The truth is, there are competing interests and priorities that need to be managed and they are best managed by a neutral third party, not by someone who represents one of the competiting parties.
Imagine sitting in a budget meeting with the CIO, discussing wish list of software and hardware you would like your team to have in the next fiscal year. Then imagine having the Customer Service manage sitting next to you with her wish list. How confident are you that your priorities would get a fair hearing.
I’m not suggesting intentional maliciousness or a conspiracy to keep you from getting what your team needs. But, let’s face it, we are all human and we come with biases. Ask yourself this: Two people ask you to loan them $5 each. Both have legitimate reasons for needing the money. One is a good friend, the other an acquaintance, but you have enough for just one.
Which way do you lean? Who gets the money?
The move by Bausch & Lomb to put Customer Service under the watch of the CIO is an interesting one and I hope it succeeds. Not because I have a vested interest, but because I think it’s risky and I admire risk takers.
For consumers it can mean illness and, in some cases, death from ingesting tainted products. For producers a recall, however modest, can mean lost business and, often, bankruptcy.
The bottom line: Recalls are not good for anyone.
For food and beverage producers surviving a recall hinges on several factors, not the least of which is the ability to trace up and down their supply chain from supplier to retailer. There are many ways to implement lot trace in an enterprise, some good and some not so good.
Today’s podcast explores the importance of lot trace to a food and beverage enterprise, the differences between single and multi-level lot trace, and what to look for when evaluating an ERP system to automate your manufacturing processes.
Ok, I’ll concede that achieving yield perfection is pretty difficult, but that doesn’t me you don’t do your best to get as close as possible. After all, any variance on yield - high or low - costs the company cash. If you find yourself on the low end - getting out less than planned - you can add customer satisfaction to the debit column, also.
Today’s podcast is a discussion of the importance of yield managment, how variances - positive and negative - impact the enterprise, and what you can do to improve your results.
May 13th, 2008 · Posted by Mark Palony · No Comments
(Readers of the Enterprise Technology Blog know we’ve spent a fair amount of time on the subjects of SAP Business ByDesign and SaaS. Use the category list to access previous posts and podcasts.)
Since it announced a delay in the general release of SAP Business ByDesign, the software leader has been bombarded by questions about its ability to succeed in the world of SaaS and to penetrate the SME market space. I’ve read several blogs that have used the occasion of SAP’s announcement to declare its initiative null and void and that any further efforts to expand into the SME space will be met with a similar fate. What many don’t understand, and what SAP has had difficulty communicating, is that the majority of their customers are SME customers.
To understand SAP’s SME strategy you need to understand the role played by each of its three midmarket - SAP Business One, SAP Business All-in-One and SAP Business ByDesign.
I’ve seen a few summaries, but none as good as this by Simon Jacobson of AMR Research. In it, Simon explores SAP’s three product approach to the SME space and places each of the three into their proper perspective. Simon salutes the “partner ecosystem” SAP has developed (an area we explored in earlier podcasts) as a means of bringing its products to market and rightly states that it needs to continue to play an important role if SAP is to continue its midmarket expansion.
In the end, Simon came to two clear conclusions:
Business One and Business All-in-One continue to perform well, and we [AMR] expect them to continue to gain market share.
Business ByDesign will eventually sort its kinks out and will gain volume.
Creating an enterprise-wide on-demand software suite is a daunting and gutsy project. One in which successes and set-backs will be many. Few software publishers have the resources to succeed, but SAP must be placed among the few.
Controlling costs through controlling inventory is Manufacturing 101. But for small batch manufacturers of food and beverage products, indeed any perishable goods, the simple becomes complex.
Unlike big batch enterprises, where one line will produce the same product day after day, week after week, small batchers may run several products on one line, making tear down and set up a frequent occurrence.
Today’s podcast is for you, the small batch manufacturer. In it we discuss what you want to look for in an ERP system when considering inventory.
WARNING: I’m departing from the normal tone of this blog by inviting you to watch a video case study. Fischer & Wieser is a small batch manufacturer that produces more than 70 products on one production line. Inventory variance was a major pain in their operation. The video illustrates how the right ERP system can make a major difference.
April 24th, 2008 · Posted by Mark Palony · No Comments
If you’re going to ASUG and/or SAPPHIRE in Orlando in May, you’ll want to check out the presentation by SoftBrands own Diane Palmquist, VP of SAP Products:
Subject: 3 Reasons You Can’t Afford to Ignore Software-as-a-Service.
When: May 5, 2008 at 2:15 - 3:15
Where: Content Area: Small & Medium Enterprise. Orange County Convention Center.
If you want to familiarize yourself with Diane and her take on the move toward SaaS, give a listen to the series of podcasts published previously.
Diane talks about SAP Business ByDesign, the SaaS product introduced in October 2007, and how SaaS is causing a fundamental change in the way software is delivered, how publishers are mesured and how partners are impacted.
It’s a hot topic, but it’s not the “topic-of-the-day”. Software-as-a-Service is one issue, concept, subject that will only continue to grow in importance and reach.
Chuck Sacco concludes the BPM equation by adding the final variables for success: skills & tools.
You may have a great implementation plan, but without the right skills in place and tools at hand your chances of are limited.
Listen to the final episode and you’ll find out what tools are available, what skill sets to look for, and where to look if you don’t have them internally.
Business Process Management isn’t brain surgery, but, as with most things, if you fail to execute you lose. You lose time and money that can never be recovered. Failure also mean you stand a good chance of losing ground against the competition.
Simply put: Execution is everything, and that is what Business Process Management part II is about. Continuing the discussion with Chuck Sacco, we talk about best practices when executing a BPM initiative in your enterprise.
It begins with rethinking the structure of your company, understanding how functional areas are interrelated, and the impact of horizontal processes. It concludes with streamlined processes that align your people, processes and systems with your strategic goals.
