Why am I pushing a quick marriage on NetSuite and Adaptive Planning? There is no need for a long engagement for these two SaaS vendors.<< MORE >>

This is a question that many clients ask. "Should SaaS be part of my BI (and PM) strategy?" When I answer yes, the obvious next question is "how?" << MORE >>

The Deal
IBM has announced their intent to acquire SPSS for about $1.2B or $50 a share.  Seems like a nice premium for SPSS stockholder's at around a 42% over the previous close.  But I will leave the financial analysis of the deal to the investment community.

The Impact
I like the deal for the overall business intelligence and performance management market.  Predictive analytics has been talked about by analysts of the BI and PM market for years without much traction outside of the statistical analysis vendors (SPSS and SAS).  IBM is the first vendor to really put some significant skin in the game by making a major ...<< MORE >>

Rather than develop a full blown internal ROI analysis, many companies would prefer to point to the return a similar company, in a similar industry, with similar challenges, achieved as a proof point of the value BI and PM can bring.<< MORE >>

Last week IBM announced their 2nd Quarter earnings. The numbers were almost universally regarded as positive even though their revenue declined 13% and did not meet analyst expectations. Why was this perceived so positively? Because earnings were up 12% and they beat EPS estimates despite declining revenue. << MORE >>

Back on June 19th LucidEra closed its doors and went belly up. Is this the beginning of the end for SaaS BI? Not in my opinion.<< MORE >>

In a perfect world all of our activities would be linked directly to corporate goals and we would be constantly monitoring our impact on performance.  If that is the environment in your company, congratulations you are one of the few.  In the real-world many of us don't know how we impact performance and what we can do to improve performance.  So, what should you do?  Just keep doing what your boss tells you and hope that what you are doing is important?

No.  I suggest taking a minute to listen to your company's quarterly earnings call.  But don't hang up after your management speaks.  Stick around for the Q&A.  What questions did the analysts ask?  How did your management respond?  Could they confidently back up their answers?  What was your perception of the analysts reaction to the answer?

This can help you understand what are the most pressing and highest profile performance management areas.  Do you do anything to impact these areas?  Can you influence improvement in those areas?  Are there current or potential performance management initiatives that would be better regarded if they could be repositioned as improving performance in these areas?

You may not come away with an epiphany but the earnings call will surface areas of priority, performance weakness, and lack of insight .  At the very least you will have a better understanding of the challenges your management is facing.  In my opinion it is an hour well spent.

    

I religiously read former colleague Bruce Richardson's First Thing Monday and his blog.  A recent entry about software innovation generated a lot of comments from both the vendor and user communities.  It reminds me of a commentary I wrote last June about the survival of the independent vendors after the mass consolidation in the BI and PM markets.  I wrote that one of the main reasons I believe independent vendors will continue to survive is their ability to innovate faster than the mega-vendors.  I continue to believe that is true, most innovation comes from smaller more nimble vendors who can provide deeper, targeted solutions while mega-vendors focus on the needs of the masses.

Many of the acquisitions by the big gorillas in this market were done because of the innovation of the companies they acquired.  The key to continued innovation is to let that small company innovative culture thrive in the larger environment.  Becoming part of "the machine" can suck the creative juices from the acquired company and soon the best resources move on in search of an innovative culture. 

Can the Big Gorillas Innovate?...I believe they can.



The acquiring company should nurture the creative environment they acquired rather than push to assimilate.  Yes, the back office and other areas need to be assimilated to take advantage of cost savings.  Yes, marketing strategies need to be redesigned to take advantage of the combined entity .  Yes, R&D leadership needs to ensure that there is symmetry across the entire development team and integration across products.  However, individual contributors and teams should be shielded from this as much as possible and left to continue to innovate.  A  mega-vendor with vast resources and a huge client base provides advantages that can not be found in smaller companies, if the culture is retained the company gets the best of both worlds (my 6 year old daughter would appreciate the Hannah Montana reference).

An Example
Bruce Richardson blogged about Oracle's 100 Days of Innovation campaign as an example of a mega-vendor focusing on innovation not just integration.  Another example comes from SAP BusinessObjects.  Prior to their acquisition by SAP, BusinesObjects had released a BI search product called Polestar.  Since the acquisition they have continued to innovate this product and as part of SAP have combined that innovation with technology from SAP's BW Accelerator to create SAP Business Objects Explorer for fast, self-service investigation against very large BW data stores.  In my opinion SAP would not have been able to provide this solution to their BW customers without continued innovation from the BusinessObjects team.

So yes, the gorillas can innovate but they need to work hard to keep from suffocating innovation with their bulk, bureaucracy, and politicking.  They must nurture the creative culture and resources of acquired companies and let the mothership focus on integration, efficiencies and leveraging their vast resources to support and fund innovation.

What do you think?  Can the gorilla's innovate?  Are they innovating?  Can they innovate as quickly as smaller vendors?  Is your acquired vendor innovating as effectively as they did when they were independent?

    

One of the biggest challenges I hear these days when it comes to BI and PM initiatives is finding a sponsor.  It's not just that funding is limited, it's also that sponsors are reluctant to step up and put their neck on the line in this economy.  Sponsoring a failed initiative right now can be career threatening.

The analogy that comes to mind is The Apprentice:


Each week Donald Trump fires someone and almost invariably it is the losing project leader.  So why would anyone volunteer to be project leader and risk putting themselves squarely in The Donald's cross hairs?  In my opinion there are two answers:

1. Differentiation.  They want to differentiate themselves from their peers in the eyes of the decision-maker.  (The Donald is going to fire someone, I better give him a reason that it shouldn't be me).
2. Confidence.  They believe in their team's ability to excute on the project which mitigates the risk of being fired.

The same psychology can be applied to potential sponsors of BI and PM initiatives.  Many potential sponsors are stuck in a risk averse mode and are content to keep a low profile right now.  They'd rather sit back and let someone else step up and take the risk.  They need to be convinced of why they should even consider taking on the risk of becoming the sponsor.  They need to be pursuaded:

1. How it will positively differentiate them in the eyes of key executives
2. Why they should take on this initiative rather than other potential initiatives
3. Why now is the right time to take it on
4. That the scope is realistic and measurable
5. That the right resources are in place to execute succesfully
6. That the potential risks have been considered and mitigation plans are in place

In the past a strong business case was necessary to get funding approved but today a business case is necessary just to gain sponsorship.

    

I will start with a caveat.  I am on Facebook and have over 100 friends.  That is not many by most accounts, I know, although I don't think I have a 100 people I can call friends in the real world.  To date I have only updated my status once or twice as opposed many times in one day as many of my "friends" do.  Although I don't really care if my "friends" changed their cat's kitty litter, there are others out there who find that fact worthy of reading, and even more curiously, worthy of a return comment.

However strange and interesting I find the narcasistic and voyeristic aspects of Facebook, that is not my topic for today.  No, today is for ranting about the impact of Facebook on business productivity.  I know there is significant potential business value from social networking (just ask any software vendor or analyst if you want to hear the value proposition) specifically around brand identity, awareness and sentiment.  I have no doubt that Facebook's impact on branding and marketing will continue to grow (probably exponentially) for years to come.

But what about its impact on our productivity?  What I see is another distraction for millions of workers in a world where they are already overstimulated and overworked.  There is research that says Electronic Breaks actually contribute to higher productivity (in small doses) but do we really need another way to spend our "down-time" at work?  Eventually won't more options for spending down-time motivate us to create more down-time in order to use them?
 
If you look at the usage of Facebook by a typical business person, it seems to me that in most cases Facebook is being used as procrastination tool when we don't feel like doing real work or as a vehicle for daydreaming during meetings and conference calls.  Where is the productivity in that usage model?  I don't see it.

Maybe I'm just having an Andy Rooney moment, maybe Facebook is having a positive impact on business worker productivity and I'm just missing it.  If you think I'm off base let me know, this is one of the few times when I actually want to be wrong.