Appirio is a new kind of integrator. In the four years since the company was founded, the company has completed over hundreds of engagements. Much of their work is focused on connecting cloud solutions like Google Apps, Workday ERP and Salesforce.com CRM to each other and work on hand-held devices.
Salesforce.com is having its annual conference (Dreamforce) in San Francisco in a couple of weeks. It's an event that should draw a record crowd (I'd expect 18,000+ this year). Appirio, I'm fairly sure, will be there. So, to get a jump on Dreamforce, I recently posed a few questions to Narinder Singh, the head of Products, for Appirio. Here is our exchange:
Brian: Appirio is a different kind of integrator. It's not implementing older on-premise solutions. It is connecting different cloud solutions to each other and to mobile devices. Is there really that much work out there? What's the prognosis for the future? How big is the market for cloud-to-cloud service integration going to be?
Narinder: When we started the company, we had a visceral belief that on-demand (there was no cloud then) was going to change the industry forever. We believed it was not a question of “if”, but “when” and “how long?” Four years later, it’s not faith but concrete evidence that makes us feel that way. Our point proof includes hundreds of customers who we've helped move to the cloud and a recent industry survey of cloud adopters. The market has shown there is no going back.
Brian: Right now, Appirio seems to be focused on three main cloud solutions: Google, Salesforce and Workday. Any thoughts on who should be next? Taleo? NetSuite?
Narinder: We traditionally looked for partners with three main criteria:
Critical mass to support an ecosystem of innovation
Relevant because of the Public Cloud
Part of this criteria was religion, part of that was our own size and capability in the market. In the future we will continue with the same criteria but, now with Appirio CloudWorks and maturing standards, we have an ability to bring more innovation from more providers to enterprises—without creating friction and SaaS silos. So expect to see more rapid expansion with CloudWorks—we are already doing that with partners like Marketo, Dun & Bradstreet and Xactly.
At the same time, we will expand our most strategic relationships slowly. We now have a fourth criteria that involves learning from our customer base and seeing what will be most important to them. The names we hear most in that segment are companies like Cisco (Webex and Quad for Collaboration), Amazon, VMware (public cloud not their simply their core business), Taleo, SuccessFactors, Concur, ServiceNow along with many others, and that list is constantly evolving.
The other dimension we are very committed to is mobile. We actively working with iPhone OS and Android from a technology perspective and those are very attractive partners.
Brian: Appirio is now in the software business. Sadly, the track record for integrators getting into the software space has been mixed. How is the Appirio software business going to succeed when so many service firms have failed doing this before?
Narinder: Here’s the short answer. We have pursued this model by design from the onset, it’s part of our DNA and culture as a company, and the public cloud makes it possible.
The historical pattern has been services businesses grow tired of low-margin people businesses and have envy over product margins and "get into software". Our model by design from the onset has been product and services—the next generation IBM without the baggage of hardware. We want to have a trusted advisor relationship with enterprises as they go down a decade long journey to the cloud. We also want to bring them the people, the process and the technology to make that shift. From the product perspective, we look at our services business as being product management for the entire move to the cloud. We have a much more nuanced view of real customer needs than anyone because of the 800 cloud projects we have done for enterprise customers.
From the onset we combined this view with a dedicated and experienced R&D function that was focused on increasing the value/reducing the cost of what we were doing for customers. That balance overcomes some of the historical model conflicts between services and products and focuses on the overall customer solution—people, process and technology.
However, this would not be sufficient in a historical context; the cloud is what makes our entire business model possible. The name SaaS itself directly connects software and service. And for today's solution providers the public cloud even takes hardware and data center management out of the equation.
In the past, the pattern that did often occur was that companies would transform from services to being a "product". They had to make a leap and hope it worked, the cloud makes that jump unnecessary. Still it’s created a difficult—but very possible—business model that aligns better with what customers need to succeed in the future.
Brian: The proliferation of mobile technologies in business is moving well beyond the simple cell phone. Tablets (e.g., iPad) and smart phones are more commonplace that ever. Users that had traditionally lacked desktop computers or worked in jobs without access to the Internet are now packing connected handheld devices. How much of Appirio's growth is aimed at this interconnected workforce of today? What other capabilities is Appirio hoping to bring to the market?
Narinder: We believe mobile is at the center of the movement to make users the center of our systems. The ability to have the information come to you, without searching, wherever you are working, is the game changer. Think of it as augmented reality for your business. Looking at an email, it should tell you anything you need to know about the people you are communicating with—how many orders, payment status, support history, etc. In that example, context is the email you are looking at. Mobile has entirely new elements of context—of course what are your doing on the device (apps), where are you (location), what/who are you looking at with your camera, what other devices/people are near you and much more.
We have customers like RehabCare that have deployed over 10,000 mobile devices. Each customer will have their own path, but we view mobile and these kinds of capabilities as core to our customer's competitive differentiator and thus our focus and strategy.
Brian: In just four years, Appirio has racked up an impressive number of clients and completed projects. What's your projection for the next four years?
Narinder: Appirio has racked up 180 enterprise clients, 800 cloud projects and about 5,000 companies that have used our products and services. Our projection for the next four years is more, a lot more. In all seriousness our business will continue to mature. We will be strategic cloud partners with hundreds of the world’s most significant companies, help even more medium enterprises go all the way with the cloud, and potentially impact tens of thousands with our cloud solutions.
Brian: Not every company is going to adopt cloud applications for every one of its application needs. How will Appirio serve clients with a mix of on-premise, cloud, hybrid, private cloud, etc. solutions?
Narinder: We are provocative in the market because we believe in the public cloud so vehemently, yet we are incredibly pragmatic with our customers and their individual situations. We have (on occasion) even endorsed an on-premise product—and it’s painful every time. Yet, in those cases we have not taken on the work directly, we helped them find additional partners. This is because we are so focused on what we believe offers the most differentiation for our customers—which is the public cloud. We often deal with on-premise applications with custom app development replacements and integrations, but do not work on initiatives that do not rely on the public cloud as a part of the work. This focus lets us see the forest for the trees from the customer's business perspective versus just their IT perspective.
Brian: Cloud solution adoption by large and small enterprises seems to be increasing but it also appears to be most welcomed on the two U.S. coasts. However, Europe seems to be lagging. Is Appirio seeing this same take-up, too?
Narinder: Yes, but this pattern has held true for technology adoption in the past as well. We do see some breaks from past paradigms in markets. Like in Japan—where historically app adoption has been low but custom app development has been important. It’s a huge adopter of the cloud because it gives them flexibility and scale in creating apps that are very focused on their market and needs.
Brian: I've researched and reported on the economic savings of cloud solutions. How are cloud solutions affecting businesses beyond an economic level?
Narinder: Our cloud adopter survey from earlier this Fall indicated what we always believed - that the cost savings are inevitable but a very, very small part of the equation. They make it easy to adopt, but the real advantage is a business that has the flexibility of the internet vs. a mainframe green screen. When lined up with a specific initiative this impact can be very clearly identified, but there is a world of benefits beyond the individual ROI that is just even more powerful (it’s just not as clear). It’s the network impact for business flexibility (much like what email did for communication). As companies adopt more of the cloud it will be most effective when paired with a transformation that creates a more agile enterprise.
Brian: What should the world really know about Appirio?
Narinder: We are passionate and committed to changing an industry with the cloud. We hope that journey allows us to build a successful business ourselves.
We believe in something and then look for business around it, not the other way around. Our first step to every significant partnership is to evaluate and use the technology ourselves. This is a pattern with almost every consumer product company, but is actually incredibly unusual in the technology industry. Customers deserve vendors who believe to their core in what they are doing, and that’s what bands the people of Appirio with our partners and customers.