The world of IT failure is bizarre. Despite outrageous statistics that affect virtually every major enterprise software vendor and customer, from ERP to CRM and beyond, mere mention of the topic terrifies many in the industry. As a result, IT failures have become an accepted, almost expected, part of enterprise life.The time for this unfortunate situation to change is long overdue.
IT failures arise from a confluence of factors such as misunderstanding technology, poor judgment, lousy project management, politics, conflicts of interest among the Devil's Triangle, to name just a few. Enterprise projects are hard precisely because they extend across organizational and functional boundaries; solving the problem requires a holistic view that encompasses multiple stakeholders and project participants, inside and outside the company.
As we enter 2012, three trends will drive renewed interest in improving IT success rates:
A difficult economic climate that is less forgiving of financial waste and lost productivity
Software as a service (SaaS), which holds the potential to simplify implementations and reduce risk, cost, and time
Consumerization of IT, including rise of the CFO (and lines of business) as a powerful force in IT investment
These trends have placed pressure on enterprise software vendors, system integrators, and customers to improve implementations and reduce the waste associated with enterprise projects.
As we enter 2012, there is evidence of enterprise software vendors taking steps to help customers run more successful projects. This post takes a look at the rapid implementation work of three vendors: Syspro USA, SAP, and Oracle.
During a recent meeting with the CEO of Syspro USA, Brian Stein, rapid implementation was a primary topic of discussion. Syspro, an ERP provider serving the mid-market, designed its product strategy around a unified implementation approach intended to address communication and other issues that interfere with successful projects.
Syspro calls its suite of implementation tools the Quantum Architecture. The suite consists of a repository for business process documentation, a collaboration methodology for working with stakeholders, and system pre-configurations. These components are illustrated in the following slide:
The so-called process repository (a term that that makes me wonder why enterprise software companies can't speak in plain English), contains key data and documentation for the implementation. Despite the techno-geek name, the repository provides a "single version of truth" for all participants in the implementation. Perhaps this is too much detail, but here's a picture:
Although Syspro is not the first to develop this kind of approach, the company is unusual in focusing so intently on implementation as an integral part of the product experience. By elevating the role of implementation and customer process change to a strategic level, Syspro has created a point of differentiation in the crowded ERP market.
I asked Syspro USA's PR manager, Stanley Goodrich, why the company decided to emphasize implementation to this extent:
SYSPRO invested heavily in implementation methodology because market studies revealed that this is where the competition falls down. The news is replete with lawsuits against SYSPRO competitors for failing to implement their software offerings in an economical timely manner.
Syspro relies on a well-developed ecosystem of 1500 channel partners that handle sales and implementation. While experienced partners are clearly beneficial, like all vendors Syspro cannot fully control the channel since it consists of independent companies. As a result, Syspro cannot guarantee that its partners will use the prescribed methodology, which is a potential source of implementation risk for Syspro customers. This issue is common among enterprise vendors and I discuss it later in relation to Oracle.
Advice to CIOs: When selecting a Syspro partner, ask about their experience with Syspro implementation tools and methods. For most customers, adhering to the standard approach is best; don't let the integrator stray without strong reasons for doing so.
SAP (disclosure: SAP is a current client) is actively developing a broad set of offerings, called Rapid Deployment solutions (RDS), intended to make implementations faster and easier. The company's focus on these solutions reflects growing recognition -- among customers, partners, the media, and analysts -- that smaller, highly focused implementations reduce risk and increase customer satisfaction. Negative press about failed implementations has tarnished the SAP brand, making this a critical issue for the company.
SAP is driving the message of implementation improvement through its own organization, especially to Sales and Professional Services groups. I recently spoke with co-CEO, Jim Snabe, who strongly stated his support for Rapid Deployment solutions; during a separate conversation with Sanjay Poonen, SAP's President of Global Solutions Go-To-Market, he stated a similar message. In this video, Poonen discusses the Rapid Deployment solutions.
Rapid Deployment solutions consist of a series of modules, or packages, based around various functional parts of the SAP software. For example, there are RDS modules for CRM, ERP, HANA, and many other parts of the SAP software.
As the following diagram shows, each RDS package contain:
Content such as training materials, documentation, and templates
Implementation services based on a fixed-price and fixed-scope of work
Pre-configuration based on best practices
Fixed-price, packaged services are an important component of the RDS package. Fixed-price projects can help decrease risk and increase transparency for customers, even though they are not perfect for all situations, especially when requirements unclear or the project has unusual complications. Nonetheless, standardized implementations, based on fixed price and scope of work, are definitely a basic tool in the fight against IT failures.
In some respects, the RDS offerings disrupt traditional professional services much as software as a service disrupts the on-premise business model. In both cases, well-defined outcomes and predictable costs replace a model that involves open-ended expenditures and high risk; that's a good combination for enterprise buyers.
Despite the growing importance of Rapid Deployment solutions, a few caveats are in order. These solutions are still relatively new and do not yet cover the full range of SAP software. In addition, they are currently most suitable for smaller projects or pieces of a larger implementation.
Advice for CIOs: Any organization contemplating an SAP implementation should evaluate whether RDS is a suitable possibility. While not a fit in every case, Rapid Deployment solutions offer a compelling means to save time and money without paying consultants to reinvent the wheel. Customers considering an RDS project should examine how it fits into their overall implementation plan and be sure to understand any external components or dependencies that will be required.
Oracle's sheer size means that any attention to reducing implementation cost and time is important to the enterprise software industry as a whole. Like SAP, this company's customers have suffered from failed IT projects, making implementation an important topic.
Oracle recently announced that several system integrators have developed "rapid implementation offerings" for the company's Fusion Human Capital Management (HCM) product. Although there is obvious value in Oracle's recognition that customers want rapid, more efficient implementations, the press release is short on details. Also, it does not indicate whether Oracle has developed its own Fusion HCM rapid implementation tools or is leaving that job entirely to partners.
A decentralized approach to implementation methodology (if that is in fact Oracle's plan) encourages buy-in from the system integrators developing such tools, which is an important benefit we should not underestimate. However, when each integrator develops its own tools without centralized planning from the vendor, substantial duplication of effort is likely, potentially leading to inefficiency and confusion in the market.
Although vendor-imposed implementation standards give customers confidence and make it easier for them to buy professional services, convincing external partners to standardize on the vendor's methodology is difficult. Because each partner serves a unique market segment with particular needs, integrators complain that a "one size fits all" approach to implementation is not in the customer's interest. On the other hand, some (including me) believe that integrators benefit at the customer's expense when enterprise vendors do not specify implementation standards and tools. Regardless of one's view, it is difficult for a software vendor to force tools and process on third party partners. This is the same basic challenge I described earlier in relation to Syspro. SAP also faced this problem when it first standardized on its AcceleratedSAP methodology, almost 15 years ago.
Oracle does have a separate rapid implementation approach called Oracle Accelerate. Earlier this year, I spoke with Mark Johnson, VP of Oracle Accelerate Applications, who explained that Accelerate includes a web-based tool designed to facilitate collaboration between Oracle partners and customers during the implementation planning and configuration phases. Veteran analyst, Michael Fauscette, who is Group Vice President at IDC, described it this way: "Oracle Accelerate provides a process based software configuration tool that configures the software based on customer requirements."
In contrast to the new Fusion HCM rapid implementation offerings (at least those described in the press release), Accelerate does involve centrally administrated intellectual property developed by Oracle. As Fusion HCM matures in the market, perhaps Oracle will release centralized implementation tools for partners.
Advice to CIOs. Reading Oracle's press release, it seems each system integrator is responsible for developing its own Fusion HCM rapid implementation offering. Therefore, be sure to investigate carefully each integrator's unique toolkit and conduct due diligence into the implementation process used by every Oracle partner you consider. That's good advice in general, but give it special attention here.
As an industry, we have allowed IT failures to become an accepted part of life; it is time for customers to stand up and register displeasure with vendors that do not invest in solving this problem. Although none of the approaches described in this post is perfect, collectively they point to an industry that is starting to accept broader responsibility for creating positive outcomes for customers.
We have a long way to go, but 2012 will bring heightened attention and scrutiny to this issue -- and it's about time.