Big data opportunities and challenges are getting a bit clearer


From time to time, I take a few days off work to reflect on things I don’t get to think about in “regulation time” . Its a bit of spring cleaning of my mind.

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I am in the middle of one such break today. Other than sleeping a lot, and recovering from India’s loss to Australia last week in cricket world cup – I have been busy reading, listening to Ilayaraja songs non-stop, installing a new patio door, following the progress of my dog who is on a dogshow circuit in midwest with his handler (probably the closest to a good training for me and my wife for when our kiddo leaves for college) , catching up with my friends/mentors/old customers/school mates etc.

Yesterday night, I finally put an end to my month long misery of not being able to crack the 2048 game ( it is a super addictive game – my advice is to not start on it unless you don’t mind spending every spare minute on your phone playing it, and it is a big culprit on the battery drain front). The first thing I did after getting the 2048 tile was to take a screenshot to show my daughter who challenged me to do it, and the next thing I did was to delete the game on my phone. All of today, I have been fighting the withdrawal . As of 5 PM PST, I can report that I could resist the temptation of not downloading the game again and playing it all over again :)

Spending the time talking shop with all the peeps I managed to get a hold of these last few days – one thing hit me immediately. Customers and vendors who have started on their big data journey in the last year or two have a new appreciation for the opportunities and challenges in front of them. The opportunity part is pretty straightforward – customers are recognizing that some of the hype around big data is justified, and that real verifiable customer stories are now available. Of course they also know the koolaid firehose is still running full :)

Here are some recurring themes on the challenges.

1. Talent shortage

Vendors need technical pre-sales people and developers the most. Customers need developers and ops people either in house or from consulting companies. And such people are apparently in unicorn category. And when these people are available – the employers just don’t know how to evaluate their skills.

Another issue that customers seem to be running into is breadth vs depth. They can usually find an expert in one technology for the right money. But a project typically needs more than one new technology – like maybe hive, mongodb and say elastic search. People who can integrate all of them in real life are rarer than unicorns in rainbow color.

2. How exactly does open source work ?

The people who understand the nuances of open source are overwhelmingly on the vendor side of the house. This includes legal experts. Some customers are also finding their trusted buyer’s agents are not yet smart on open source models. There is some silver lining though – Subscription models are better understood compared to a year or two ago.

3. Procurement cannot figure out what motivates sales people any more.

This one made me smile quite a bit. A good part of my grey hair can be attributed directly to wrestling with procurement folks over the years. Here is how one guy explained it to me ” It was pretty simple in the past – the larger the check I could write, the more benefits I could extract from the salesman. It no longer seems to be the case across the board. Sales reps selling BI and big data things to me all seem to have incentives that are rather unique. Some don’t even want big checks anymore. Some like cloud and some others talk me out of it . I feel like I need to take classes on dealing with them”.

And an IT director buddy – someone who has planned and executed 100s of millions of dollars worth of projects in his career told me “I have a hard time with financial models for projects now given the mix of perpetual and subscription models for all the different software I need. I can barely understand all the pricing and terms nuances , let alone explain the full picture to the controllers and other stakeholders”.  The impact is a weird situation – he takes more time planning a project than actual execution, and he hates it.

4. Development is not the big worry anymore – maintenance is 

They all unanimously agree that these new technologies all reduce development time significantly and give great flexibility to make changes relatively quickly. However, they all have the same worry on maintenance – especially my friends who work in consulting/outsourcing companies. These new technologies all have different security models, different ways to backup and restore and different ways to provision new instances. Each one is built individually to be maintainable and scalable – their worry is how to do all of them together with tight SLAs.

5. Minimal vertical messaging 

I never thought I would hear customers ask for more marketing – but that did happen!  What is the world coming to ? :)

These folks have all heard it loud and clear that data is big and bad these days and these new technologies can all help them to tame the bad ass big data beast. But they are looking for specific examples of how it helps customers in their industry. On the bright side most of them are not hesitant to try proof of concepts for new use cases.

I did not offer any solutions to these challenges – my intention was just to listen and get a feel for where we are headed at a big picture level. But now that I have thought about it a little bit, I have some rough initial thoughts on things that can help make life easier on this front. When these thoughts are a little better formed, I will make an attempt to scribble them and share.

I am very curious to hear from all of you on whether these themes are showing up in your big data journey. Let me know !

Wishing Godspeed To Marilyn and Mark, The Godmother And Godfather of SAP Community


I have had a writing block for a couple of months now. Then I saw the news of Marilyn and Mark moving on from SAP and that reminded me of the two year hesitation I over came in 2008 to write my very first blog.

That blog was written almost exactly 7 years ago on SDN http://scn.sap.com/people/vijay.vijayasankar/blog/2008/03/10/bi-and-esa-driven-approach-to-sap-project-implementations–part-1 . The first time I felt like I should blog was probably two years prior to that – but I was scared, and rather clueless on how it is done. Finally I mustered the courage (mostly with endless encouragement from friends at IBM and SAP who said something like “its going to be great – but you go first” :) ) and wrote it – and it got read by a couple of thousand people or so. Some kind folks even took time to post some encouraging comments. I liked that first experience enough to write two more to finish my thought process on that topic . Next thing I know, it got featured on SDN home page and I was moved to “expert blogger” status – which meant my content needed no further reviews before publishing. That was not really me being a great blogger right off the block – it was all Marilyn working her magic behind the scenes to encourage a newbie :)

While blogging was new to me – SAP community itself was not. I had been in the field since the mid 90s and was commenting on forums and blogs for a while. I was also a regular at Techeds, mostly as a participant but also occasionally as a presenter. And that is how I first ran into Marilyn Pratt. Looking back, it was a turning point in my life and career. Marilyn, as she had done for several others, took me under her wings and nurtured my interest in blogging. She has the most facilitative style of anyone I know – never once did she tell me that there was a better way of doing things (I was pretty bad – I know it, but she never made me worry about it), but would just keep encouraging me to blog more, talk more at events, develop my network within the community and so on. My confidence grew sufficiently to be a regular blogger on SCN and then a couple of years later – I started this blog to rant about non-SAP stuff.

What I learned the most – and continue to learn – from Marilyn is the concept of paying it forward. There is a second lesson too – she is a wizard when it comes to connecting people with common interests. There was not a lot that I could do for her for everything she has done for me. She in fact constantly tells me she did not do much for me ( that is dead wrong – but she is way too modest). I learned from her , and later from others too, that all I should make sure is that I pay it forward by helping the people who come after me. It is not just about blogging – I have certainly helped others get started on blogging , but it is just as important in every aspect of life. I can’t say I have mastered it at all – but I have indeed been trying. It has made a big impact on how I look at life and I mostly have Marilyn to thank for that. I am sure I am not the only one who thinks that way.

Soon after I started blogging and presenting at SAP events, I started meeting some interesting people across the world . No two were alike – what exactly is common between Thorsten Franz, Dennis Howlett, Jon Reed, Sue Koehan, Tammy Powlas, John Appleby and Vitaliy Rudnitsky ? And I met more than a 100 such unique souls and many became close personal friends. That is the beauty of community – random individuals come together due to some common interest, and they stick together for a long time and develop new set of interests together. Its very rare that I talk about SAP topics with any of these folks I met through SCN – but each have enriched my life in meaningful ways. And that would not have happened without Marilyn.

I had already seen Mark Finnern from a distance at that time. And a little while after I became a regular blogger on SCN, I got a phone call from him to say I have been selected as an SAP mentor. I literally got a feeling similar to winning the Nobel prize or something of that magnitude. He would not tell me who nominated me. I tried asking Mark Yolton and Chip Rodgers – and they would not tell me either. It was only after I joined SAP that I figured it was Marilyn Pratt who nominated and nudged Finnern into taking me into the mentor wolf pack . For a second time, my life (and career) took a meaningful turn. I now had access to some of the most interesting leaders like Vishal Sikka, Jim Snabe, Bjoern Goerke, Sanjay Poonen et al at SAP and knew a lot more about how decisions were made on many products and programs. I knew many of these SAP execs from my time at IBM – but being in the mentor program made it a much stronger relationship and many of them became friends and mentors for me.

Mark and I became good friends and I was very active in mentor program. I always knew that he was working hard to make it easy for mentors to add value to SAP. But I did not realize the extent of his challenges till I actually joined SAP myself couple of years ago. It is a large and complex organization – and at any point there would be someone in the executive team who thought mentors added a lot of value. Unfortunately, many of those executives moved on from SAP too from time to time. So Mark had to rebuild his relationships constantly to make sure the program continued to have sponsorship at the highest level all the time . Mentor program is under SAP marketing from an HR reporting line – although its intent is not to be a classic marketing initiative.  I have always admired how Mark managed to keep the program thriving because a good part of the ROI of mentor program is intangible , or at a minimum cannot be measured in classic marketing KPIs. A lesser man or woman would have thrown in the towel and walked away from leading this program. But then Mark is not ordinary – he is as extraordinary as someone can get and he made it work. And a lot of us who are mentors (or are alums like me) are grateful to him and SAP for the opportunities it gave us.

I have no doubts in my mind that Mentor program has served SAP really well over the years – more than anything else, it is a much needed and invaluable reality check on how the ecosystem perceives SAP.  Each and every mentor does something unique that adds value to the SAP community and to SAP the company. Mark’s shoes are really big to fill – but SAP is not short on talent . Whoever has taken over Mentor initiative – I wish you well and I hope you will keep the flag flying high and take it to its next level. The brand of mentors is intertwined with the brand of Mark – and rightfully so for everything he has done. But as he leaves for his next adventure, I am excited to see how the program evolves.

Marilyn and Mark – I wish you the very best in the next phase of your personal and professional lives. You have made a dent in the universe and I will be cheering for you all the way. Godspeed my friends ! I look forward to grabbing a drink with you real soon.

Crash Course – How to build a career at a consulting company


I left the world of system integrators and consultants a few years ago – but even today, the question I get asked the most is “how do I grow my career in consulting at my big name employer?”.  I thought I will post some of my thoughts – from my own experience in big consulting houses, as well as watching several others go through their careers from close quarters.

There are many ways to do this – so don’t think of it as “check these boxes and you are done” :)

1. Be the go-to guy in the company for something

This is the starting point – you need to be much better than everyone else, and willing to help everyone, for some unique topic that is in demand. This is how bosses know that you even exist in the company. The topic can be some technology, power point skills, knowing the best restaurants for boss to take customers – it just needs to be something that you are WAY better than anyone else. For me – that was Netweaver technologies and SAP CRM. I also know a guy who fast tracked because he was exceptional at making PPTs. You cannot stop learning – if you do, someone will over take you and it will be hard to win your turf back. Many a promising career has been lost this way.

Don’t get too narrow in what you are good at. Technology changes way too fast . You don’t want to be labelled as the expert on an obsolete technology or management technique. Move with the times and keep your eyes and ears open. Also – don’t be afraid to take a stance on topics where you have an expertise. Just be humble enough to concede a point when someone makes a logical argument.

2. Be known to the world

You might be awesome in your company and everyone adores you – but if google does not know you, it does not count anymore. Please don’t say “I don’t have time for it”. You always have time to do what you likeand prioritize. Lack of time is a poor excuse.

You need to express yourself in public – blogs, presentations etc outside your company firewalls. This is how customers and analysts and other employers know about you. And they will be willing to pay a premium for your services. Employers love employees that customers and analysts love. Simple as that. And if your career stagnates at one company, this gives you options to try your luck elsewhere.

3. Choose your career path consciously, and OWN it

Every consulting company promises at least three of four career paths – sales, management, delivery, technology. In theory, they are all equal. In practice they are not. Sales and Management typically will have more leadership openings compared to delivery and technology.

Technology is the most difficult one to go all the way up in a consulting company. You can be great at sales and management and make managing partner in IBM – but you have to be a real Einstein to be an IBM fellow. So choose wisely . The safe choice is always sales and management.

You own your career – not your boss, not HR, not any one else. If you wait for others to do right by you – you will wait for a very long time. Actively change courses till you get to cruising speed and altitude.

4. Start selling early in life

I hated sales as a young consultant and my mentor took me kicking and screaming into a quota carrying role. Turned out I was quite good at selling to customers. Even if you are not the actual seller, you can still learn a lot by being part of the proposal team . People who can convince customers typically fast track their consulting careers. And sales teaches you a hard lesson – even the coolest technology is not going to be bought unless you can explain it in simple language to customers.

When I was made an associate partner in IBM, the only thing my boss told me was “treat me as a customer and we will get along fine”. It was excellent advice. You need to sell your ideas effectively inside your company just as much as you need to do it outside.

5. Learn sales execution 

Being able to get a customer to understand your value proposition is not the same as making her buy on your terms and time line. That is a whole different ball game – and you need to learn how to do that and what levers you can and cannot/should not pull.

If you are not good at that – get someone on your side who can do it for you and learn. When your boss thinks of making you a leader – often sales execution is the deal breaker. This is also how you develop a thick skin which you need as your career progresses :)

6. Learn Operations

Consulting is about four things – bookings, revenue, gross profit and utilization. Every quarter, your boss will be held to a different pressure . Some times it is more bookings that you need, sometimes you need more utilization. Knowing what your boss is held accountable for is key to how you win approvals for deals internally. The larger your company – the more important this becomes. Without learning how to balance these four things, you cannot own a P&L and succeed. Become friends with your ops team and watch them work. You will learn a lot.

7. Verticals win more than horizontals

The power base in most consulting companies sit with their verticals, and not technology horizontals . Align yourself to a vertical as soon as you can . Learn everything you can about that vertical – read , attend seminars, do whatever it takes. Then try to relate your knowledge at customer projects and offer value addition. A couple of wins is all you need to be noticed at your employer. And then go do it for another customer in same vertical. Technology is great in itself – but it is outrageously good when put in context for very specific industries. As time progresses – expand your knowledge to micro verticals.

For example, I started with semiconductors – and eventually learned enough to have good conversations around consumer electronics, equipment manufacturers, etc and graduated to “electronics” expert as opposed to “semiconductors” expert.

8. Build relationships at all levels

Everyone likes to be friends with CIOs. That is a good idea in general – but you need to be friends with the DBAs, the IT directors, and so on too in IT. And then you need a few friends on business side. If you were to ever talk about transformation meaningfully at a client, you need to be able to convince IT and business. More over – the other people you make friends outside the C Suite – they will go into C suite later in your career, or might move to another company and give you new business .

Nothing is more important than building relationships in having a consulting career. You can even compensate for a lack of sales execution skills if you have exceptional relationships.

9. Make your boss and your team a hero

There are many times you can close a deal yourself. There are also many times when you need your boss to bail you out. Make your boss a hero whenever you can . This is not for sucking up as you might think. Your boss has goals which are an aggregation of goals that you and your peers have. So your boss has no reason to not help you. And by keeping her in the loop on good and bad things – you will gain her trust. You will also learn a lot watching her work. There is some nuance here – you will not do yourself any favors if you bring in your manager only for good deals and only for bad deals. If you can’t do both in moderation – don’t go down this path. Also – please don’t over do this. If they feel you need constant supervision, then you are not going up the chain any time soon.

Same goes for your team. Share credit abundantly and fairly. A key to getting ahead in your career is to find and groom someone to take your current job. And when you take bigger jobs, you need to build a layer under you that you can fully trust. You can’t do it overnight – so start early. Also – be mature enough to know that someone in your team might become your boss in future. Help her career along . If you feel terrible about it , it usually means you have some improvement to do on some dimension. The solution is to find ways to make yourself better and not to torpedo your junior’s career.

10. Make friends and mentors up and down the chain in your own company

Even if you make it to the top rungs of the ladder, to stay there is pretty difficult unless you have a support system. You will need friends above, below and on same level as you. And this means you typically have to pay it forward. Don’t help people with the idea of reciprocity. Those are transactional things that won’t take you far. Help as many people as you can – and encourage them to do the same with your example. It ALWAYS pays off.  And it is never too late to start.

Don’t just follow your boss or your mentors blindly. The thing you need the most to progress in your career is independent judgement. Learn to collect feedback from multiple sources, weigh the pros and cons but make and own your decision. I can’t emphasize it enough – It is your life and career .

11.  Stay humble

Please don’t get success get into your head too much. It is really hard to keep your mouth shut and stay humble when you are successful. But you have to learn to do it. I have seen way too many people gloat about success and then lose support inside the organization and with clients and fail. No one succeeds alone in this business. You need to thank the people who helped you succeed. And, send down the elevator if you went up first !

12. Develop a hobby and spend time with family

This is perhaps the most important part of being successful in consulting. This life needs a lot of travel and time away from families. You need to set boundaries or your work will set boundaries that you won’t like. You need to find time for family. It is all for nought if you make money and fame, but become a stranger to your family and friends. And I cannot tell you enough how much of a stress relief it is for me to play with my daughter and three dogs after a grueling week at work.

 

Rest In Peace, John Leffler !


My wife and I got engaged this day 13 years ago . She had to leave early for work and I called her as soon as I woke up to wish her happy anniversary. As soon as I hung up, my phone rang again. It was my friend and ex-colleague Jen from IBM. She was in tears and she gave me the shock of my life – that John Leffler is no more !

A huge flood of memories have been going through my mind since that call. And the sense of disbelief has not fully left me yet. I had spoken and exchanged texts with John late last week. Dhanya and I had saved the bottle of champagne John had sent us for Christmas for a special occasion. We had met in Phoenix a few months ago for a nice dinner (that is where this photo was taken – sadly, the last time I met John in person) and he told me that he had started using twitter after I started pestering him about it a few years ago.

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We were planning to meet for dinner again in New York in a couple of weeks. We even had some plans to collaborate on the work front after John’s retirement from IBM.

As much as we will all mourn his untimely demise, I think it is more important to celebrate his life. He was a one of a kind guy – as a human being, as a family man, as a top consulting executive, as an SAP industry veteran, as a mentor and friend to many of us , and as a leader. Here is a blog I wrote about him few years ago http://andvijaysays.com/2012/06/08/sapphirenow-2012-interview-with-john-j-leffler-of-ibm/

I had known John for close to ten years now I think – but it is for the last five or so years that we got to know each other closely. Before that, I had the opportunity to present some of the cool innovations my team was working on from time to time and he was always supportive. But I did not know him very well then other than as the top leader of IBM’s SAP business – and he certainly did not know anything much about me either.

Our friendship really started with a call I got on a late afternoon in December of 2010. I was home after a long week at a project – and John had just finished an exec meeting in east coast with SAP CEO and IBM CEO. My name had come up in that discussion briefly – and that was the reason he called me. John asked me to fly to SFO the next day to meet him for breakfast.

I will never forget that breakfast. John showed up on time – but with his phone pressed to his ear, and talking animatedly to someone. He motioned to me that he needs 10 minutes more. When he finished his call – he spent about the next 20 minutes apologizing to me for not starting the meeting on time ! For context – at that time John ran a multibillion dollar global SAP business at IBM, and I was just a newly minted Associate Partner. It was a big deal for a junior dude like me to even get a few minutes with John – many senior partners in the firm would never get that opportunity with John’s busy schedule.

Our meeting was supposed to be for an hour – but Joanne, John’s most trusted EA, had extended it to 90 minutes. John asked me about my background – not just my career, but my school and college life, my hobbies, how I met my wife and many other things. That took all of the scheduled 90 minutes. John had not looked at his phone or watch this entire time, and had given me his full attention and I was worried that I lost a golden opportunity by just doing small talk with the big boss.

So I politely asked him for a follow up meeting – only to be told that the 10 minutes he was on phone when he came into the executive lounge, he was just asking Joanne to cancel every other meeting he had for the day to spend time with me. So we spoke for another 5 hours or so till we had to leave for SFO for our flights home. We ate lunch together at SFO terminal and he gave me his trademark big hug as he boarded his flight, and said “You are not someone who works for me now, you are my friend”.

And he truly became my friend – and an excellent mentor and coach. He was my sponsor for my partnership appointment process, and he was the executive sponsor for the largest deal I ever closed at IBM. Any time I would need help with a customer or someone at SAP, John would gladly jump into a plane and come help all he can. He did not teach me how to sell or how to be an executive (though I did pick up plenty of tips and tricks by watching him at work) – instead, he taught me – by his own example –  on how to deal with everyone as a good human being, and I will be grateful to him for ever for that.

He was the ultimate people person. Every time I have eaten at a restaurant with John, be it an airport eatery or a fancy steakhouse – he would ask the waiters for their names and will introduce them to everyone at the table. Every time he met a customer – he would convince them that their friendship and long term success was more important to him personally than the short term business opportunity at hand (I remember Tom Rosinski telling me over beers that getting John to the customer meeting was pretty much the one sureshot way of winning any deal.). To the best of my knowledge – the man never did anything with a short term gain in mind. Treating people as people – not as vendors, customers or employees – that is what set him apart in my mind.

When I decided to leave IBM – there were two guys that I absolutely hated calling with the news because I truly felt that I was letting them down after they supported me all the way. One was Ken Englund, who I regard in the same high esteem as John. And the other was of course John. If I remember right, I caught John when he was coming out of a Church on a Sunday. I told him the news, mostly with profuse apologies. He took a minute to digest it . I totally expected him to yell and scream . Instead, he told me that he thought I made an excellent choice and that he is happy to be my reference if Bill McDermott or Vishal Sikka wanted to give him a call. For the record, Ken did exactly the same when he heard the news from me too. And about 2 weeks after I joined SAP, John flew to Palo Alto to take me out for a nice dinner to celebrate.

When I decided to leave SAP, John was one of the few people I called on for advice. He offered me a job in IBM in 10 seconds – but once he understood that MongoDB is where I am headed, he took the next two hours understanding what the company did and what my role will be. For a second time, he offered to be my reference. And yet again – he took me to a nice dinner in NY city to celebrate my new adventure.

He would pick my brains every couple of months on industry trends and SAP market. Some times he would call to just chat about random things . Irrespective of whether I agreed with him or not ( we disagreed often – and he would then tell me that I and Matteo were usually the ones he thought will give him contrarian views the most) , he always made it clear that he genuinely valued my input. He would always ask about my family as well in every single call – even though he had never met them in person. I have met John’s wife a few times at IBM and SAP events – an amazing , very pleasant and friendly lady, who clearly supported John fully during his demanding career. I have not met his children yet (he would talk about them a lot and tease me about what is in store for me and Dhanya as our daughter grows up) – and I hope to meet them very soon. I can’t begin to imagine what they are going through. I know they are incredibly proud of John – and they should absolutely be proud – he was already a legend when he lived. You will be in our prayers .

Talking about family – several colleagues at IBM and SAP, across the ranks, were family to John. This is true in reverse too.  I spoke with , emailed and texted many of them today after I heard the news. We are all devastated . John had touched so many of us in his own special way. While we all grieve – we are all honored and blessed to have known John. And he will continue to live through all of us .

Rest in peace, John ! And thank you for everything you did !

Six tips for clients when buying consulting services


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A good part of the grey hair on my head today can be attributed to negotiating consulting related topics with my clients :)

Clients and customers can often behave as if they are from two different planets and nobody wins in those cases. They can also work together extremely well and amazing things happen as a result. Despite the grey hair part – I have been fortunate in having way more positive experiences with my consulting clients than negative experiences. Let me offer a half dozen suggestions from my experience to clients on how to engage with consulting companies . There are of course a lot more things involved and lots of nuances, but this should be a decent start for the conversation.

1. Buy on net-value, not on net-cost 

If you are buying gas , you can buy on net cost. The reason you can do it is because the variance between gas across gas stations is perceived to be low. That is not the case for consulting . Even if you think you have nailed down your requirements well – you won’t get a good deal if you only care for cost, and not of value. While there are a few customers and buyers agents who take the time to do a quantitative business case and then make determinations of vendor selection based on value, many just try to be a hard negotiator for cost alone.

Let me give you an example where I lost a deal a few years ago on price.

The customer wanted a specific project done for reporting on CRM service management. We bid for it along with a couple of competitors. We lost the deal on price. Why was our price higher? I knew from my long experience at the client that they had a complex system and relatively new staff taking care of service management. So I made the proposal with an extra onsite consultant with expertise in service management whereas the competitor made it mostly remote work with generic business objects skills. A year later, I ran into the client at a social event and asked about the project. Apparently my competitor had delivered on time and on budget and on spec – except the business owners rejected the final solution saying it is not what they wanted. And many change orders later – and a 3X budget over run – they scrapped the project.

2. Decide upfront – Do you want someone to milk the cow for you, or someone who can explain on phone how to milk the cow ?

A lot of outsourcing is done by customers who don’t appreciate the stress of going through change. If you are used to shouting out loud to the help desk guy to come fix your problem and tomorrow you have to spend 15 mins filling up a form for 10 minutes and then wait for half a day for someone to call back, you will hate it. Sounds simple – but I have sat across customers many a time who don’t understand this impact on their employees.  What is worse – they will even skimp on the cost of change management . The result is a large number of employees who never got clarity on what changed and why it changed. And more than the people who signed the agreement on both sides, the poor consultants delivering the unrealistic contract gets yelled and screamed at, and people who can’t get their job done get all frustrated (rightfully).

Some customers do reference checks – but at the wrong levels. If you are a CIO wanting to do a reference call on an outsourcing arrangement – don’t call just the CIO on the other side. Go visit the people who are living in the outsourced world and visit the outsourcing staff and learn how a “day in the life” plays out. Ask how the transition was managed and learn from it.

A related aspect is clients who buy consulting as an insurance, and then feel happy when they don’t have to use it (same as with a car insurance where you are happy to spend money on insurance, but never want an accident even though you are covered) . When you need insurance for your software – your best bet in most cases is to buy support from the software vendor. Buy consulting to add value above and beyond what comes with software out of the box. This applies as much or even more to sellers. Do not sell consulting as insurance – it undermines the value of the offering over time, since most customers will buy but not use it.

3. Make a planned transition from contracting to delivery

In most cases, the consultants delivering the project don’t know much about what got signed. And in almost as many cases – the customer staff working with these customers also do not have the full context of what transpired during the contracting process. Having led many a project rescue mission – how I wish the people who signed the contract on both sides would hold a workshop for the delivery teams to get the context and ask questions and clarify things upfront in every project. My best estimate is about 20% of all projects do this . In many cases – both the customer procurement and consulting sellers know there are unrealistic assumptions , but they don’t give the context to delivery teams, resulting in nasty surprises and flamed tempers down the road. It is eminently avoidable .

Also – remember that requirements and people both change with time. So I would highly encourage a “big picture” meeting periodically to make sure that everyone is aligned .

If I am a client with a major project at hand, I would also ask if my sellers are compensated on successful project delivery. If not – I will need a lot of convincing before I sign a big contract.

4. Choose wisely between Agile and Waterfall

Agile is cool – and it is useful in many cases, especially in product companies. Waterfall gets ridiculed for both good and bad reasons. If you want the flexibility of Agile, you should be able to compromise on the fixed deliverables on fixed dates that you do in traditional contracts. Most agile projects typically are done on time and materials basis. Or they are done on fixed price basis for a certain time. If I am the client with long term projects – I would rather leave the methodology to my consulting partner, and demand a schedule of deliverables. And if I have short projects where agile is the better fit – I will either do it inhouse with own staff, or do a staff augmentation for few skills.  Bottom line – you can’t mix and match in every combination and expect this to work equally well.

 5. Trust and verify

The best professional (and personal) relationships are based on trust. When either side needs to go back to the written contract, it usually shows a lack of trust. The written contract should be the last line of defense, not the regular play. This only happens if you are both in it for the long term. Far too many customers shy away from long term relationships – I think it is mostly because they forget (or are not aware of the fact) that trust also comes with verification. Verification is not a negative exercise – the idea is to see if both sides held up their commitments, and when that is not the case a decision needs to be made on what fixes, change requests or compromises are needed.

Change orders have a bad rap – many CIOs have told me that they are scared of change orders, and in many cases they have been burned before. Change orders serve a genuine purpose – they exist because not all requirements can be judged upfront, and no one does perfect estimations. SI market is uber competitive – companies routinely undercut each other to win projects. Customers try to make use of this by negotiating on net cost as opposed to net value . The combination of these two behaviors is the genesis of change orders being used/seen as a way to nickel and dime. Essentially this plays out in a low trust environment. Don’t fall for it – be reasonable in contract negotiations, and play fairly in delivery. Get into a mode where change orders become a good thing.

6. Long term relationships between people, not just companies

Long term relations have many advantages on both sides – consolidated demand usually gets better pricing and delivery schedule. It also is a great risk mitigation exercise as communication will improve. No doubt, it is a lot of work – with different groups, different budgets, different goals etc.

Always remember – contracts are done between companies, but actual business of the project is done between real people.

By all means, negotiate hard on the net-value aspect and get as reasonable a deal as you can. But once the deal is inked – and it is time to deliver, replace “you and us” with “we” in your thinking. Many customers interview a slate of candidates for the lead roles in their projects. But very few consulting companies will ask the customer if they can meet and talk to the customer staff before the project. Not every consultant lead person will work well with every customer lead. A match of personalities is needed on both sides. If I am a client – I will encourage my consulting partner to interview my staff and then offer me lead candidates from their side who are good matches, along with suggestions for training etc. When people are comfortable working with each other with trust, magic happens in projects.

 

 

IT Services Industry in 2015


After a couple of years away from services business, I am back in it – albeit with a different flavor . My current services responsibility is to run consulting for a software company, as opposed to doing so in a pure services company. Nevertheless, with the new role, I have been thinking (and talking to old friends and customers) quite a bit over the last couple of months on what is changing in the IT services world. I am ignoring BPO services for now. Also, I am just jotting down six top of the mind items – there are a hundred other things which need attention too.

1. Increased demand for shorter time to value

In the 90s, I could easily convince a customer that the business requirement will take 6 months to implement. It is really difficult – but not impossible – to do so today. Customers do not have that kind of patience these days. We have both the hardware and software industry innovations to thank for that.

This is one area where smaller companies have a definite edge over larger companies in adapting to the change.

2. Business model changes

At a high level – most big services companies will continue to make a lot of money from large outsourcing deals given inertia of customers to let go of legacy, and fragmented SaaS solutions. This happens laregely in fixed scope/price as well as Time&Materials basis contracts today. But the model is changing for sure trending towards outcome based models. Customers expect vendors to provide more flexible capacity with less and less predictability. Some customers expect vendors to provide predictable TCO savings year over year via portfolio optimization. Not all vendors are equipped to deal with these though unfortunately. An increasing trend – but not mainstream quite yet, is the idea of managed application services tied to factors other than TCO.

3. Estimation needs to grow up real soon

If you look at estimation techniques – it is stuck in the 90s. Even in packaged software world, where it should take progressively less time to build something over time – estimates still show very little improvements from the mid 90s. A complex interface from ERP should take less time today compared to 1995 – but it ain’t so.

4. Talent Management needs a complete reboot

Talent management – or lack thereof – is the bane of services industry. Accelerated career progression (maybe more so in offshore centers) is one area that concerns me a lot in particular. Many midlevel managers have not had enough experience as individual contributors before they earned their promotions. This was the price to pay for the aggressive growth in last 10 years. But it also has resulted in a loss of senior level technical competency. Every company in services claim to have a technical career path – but very few actually do anything to make it work. For the most part, a rewarding career in services still exists only for sales and management jobs. Delivery skills are not rewarded anywhere close to sales and management. It is high time this changed.

5. Leadership Attrition

This is what is going to hurt established services companies the most in my opinion. The “rainmakers” in the established companies are a largely disillusioned bunch today from what I can see. Many of them will recognize that their impact is a lot higher if they join smaller companies , or even start a company on their own. This is a double whammy – this level of talent is extremely difficult to backfill, and usually they take their customer relationships with them. Coupled with the attrition at lower levels due to career and pay stagnation – this is a big area of concern. I am not convinced from examples I know personally that services companies are spending enough attention on this brewing problem.

6. Blurring of lines across software, consulting and support.

Most companies – pure services or software companies who do services too – keep software, consulting and support separately. There are good reasons for doing this from vendor point of view. From a customer point of view, this is mostly artificial. I expect 2015 is when many customers will demand more offerings from their vendors that blur the lines between software, services and support. This is a really hard problem for vendors in many ways – compensation, hiring, accounting, marketing, selling etc will all get disrupted when these two groups come together after being separated.

Happy new year, every one !

 

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Book Review – Winners Dream: A Journey from Corner Store to Corner Office, by Bill McDermott


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Today is the 5th anniversary of this blog – just got that notification from WordPress, as I was finishing this book by Bill McDermott http://www.amazon.com/Winners-Dream-Journey-Corner-Office/dp/1476761086 . It is a great read and there were plenty of little nuggets of wisdom in this book that I found very useful.

It is fascinating to read that Bill knew very early in his career that he wanted to be the CEO of a large company. Not many people I know – including many who are big company CEOs today – have had that realization of their destiny till much later in their career. Even before I read the chapter on how he met his wife and how great she has been as the CEO of his family, I knew he had a fantastic support system. For someone to have a career like him, that is a basic necessity . My own limited accomplishments in my career would not happened without the sacrifices and support of my wife. And consequently I could relate to his pain of dealing with his wife’s fight against cancer, and his elation when she successfully defeated the disease. I have never met Bill’s wife – but I look forward to meeting her one day, hopefully with my wife.

Bill is a sales machine and he is a master of corporate theatre – that is a good combination for a CEO. He is impeccably groomed at all times and the book clearly tells me that is his DNA. He feels comfortable in formal attire – and there are some former bosses at IBM I know who are like that. It clearly works for him – it is part of how he earns and shows respect. I can clearly see how this has influenced the people around him – for the most part, they are all impeccably groomed too.

His penchant for pageantry is something he is unapologetic about throughout the book. This is one area where I am not convinced that it is a sure shot strategy for success, especially at SAP where a lot of staff is of the non-sales type. SAP has an annual field kick off meeting and an annual developer kick off meeting. The former is all about luxury, the latter is all about frugality. To the best of my knowledge there is no equivalent of winners circle for the good people who build all the cool things SAP salesforce sells to get to winners circle. I would seriously urge Bill to look at that side of the house too. The solution might not be a winners circle for developers – but it is something for the CEO of a tech company to spend some attention on.

I absolutely love the emphasis he puts on developing people around him. He is all about team and helping remove roadblocks in their path . That is not some hollow talk – I know this to be true first hand. Towards the end of my tenure at SAP – I emailed Bill about something I needed to discuss with him. In the weird matrix that SAP is organized, I did not report into him. I was part of the engineering side of the house. In less than two minutes – I had a call back from Bill to get into a plane and go talk to him the next Monday. That meeting was amazing – I had his undivided attention and he offered two solutions and a follow up meeting to discuss how things were progressing. Couple of months later, I ran into him at Palo Alto – and he came and asked me for an update.

When I left SAP – he said two things. First he asked me if there is anything he can do to make me stay ( there was not , and I had already given my word to my new boss). Second he asked me to get settled at MongoDB and ping him back on how SAP can work with my new company. And when I pinged him back in a couple of months – he (and my great friend Steve Lucas) made the collaboration work, resulting in Lumira and Data Services now having interoperability with MongoDB.

Bill says in the book that when he took on as President of North America, he had a condition that Germany did not micromanage him from across the pond. I am glad that they did not. But this is an area where I think SAP is not letting Bill perform to his full potential. SAP organization is all about extreme checks and balances. There are three boards – managing board, executive board and supervisory board. Bill is part of the executive board, as are the heads of sales, products, support etc. I think Bill will be way more impactful in his job if he were a CEO in a more traditional capacity, like how IBM, GE etc operate. At this point – the one person who can decide across the board is Hasso as the chairman of supervisory board. And of course there is only one Hasso – there is not another person like him on the planet. But when he retires – I hope they give Bill a traditional CEO role.

Also – prior to Bill taking over SAP Americas, he says they went through 5 leaders in quick succession. It looks like that history kind of repeated after Bill moved to bigger roles at SAP too. Just shows what a hard job that is.

I enjoyed reading about the acquisitions of Sybase, Ariba, Hybris and SuccessFactors. While I think SAP significantly over paid for most companies it bought, and the integration with the mother ship was not smooth – I absolutely think they were strategic to SAP.

Sybase was acquired as a mobility company – but mobile business never really flourished at SAP ( I think SAP should have acquired a few more companies to have a meaningful shot at mobile business, and maybe they should have tried harder to keep Sanjay Poonen to run it ). But in the bargain – they got some very talented database people which helped the cause for Hana.

Similarly I do not think that SuccessFactors changed SAP DNA all that much – but SAP never would have become a known name in cloud without buying them. Ariba is an all around fantastic buy – and probably the most strategic amongst the four. Hybris, similarly is a pretty good addition to SAP’s portfolio. In all four cases- I appreciate how Bill trusted their CEOs upfront during the M&A process, even while knowing none of them will stick around.  It is a good reminder that business is always done between two people and not two companies.

Now a few things I wish the book spent some coverage on. May be there is a second biography later that will cover all of these.

1. I did expect some light to be shed on the influence of Vishal Sikka on SAP – but there were just some passing references.

2. Since Bill is all about developing a generation of leaders, I wish he spent some time talking about succession planning. There are amazing leaders under him like Rob Enslin, Steve Lucas , Bernd Leukert etc who all have what it takes to be CEO – if not at SAP, then elsewhere.

3. One issue – perhaps controversial and hence why it is not covered – is diversity in senior executive leadership levels. I would love to hear Bill’s views on diversity and what he is doing at SAP to encourage diversity, especially at senior levels.

4. SAP has an unusually large portfolio – and honestly I don’t think there is anyone in the company who knows all the products that can be sold. I would have loved to hear his thoughts on portfolio optimization, especially since he has stated that inorganic growth is a must have. With twenty thousand plus developers – it is very easy to waste precious engineering fire power by spreading everyone thin across a wide portfolio.

5. Finally, what is it that Bill himself wants to do next ? I am sure he has a long innings left at SAP. But what after that?

All said, it was a thoroughly enjoyable read and the next time I get an opportunity to meet Bill, I am getting my copy autographed.