Is collapsing layers a good thing? Help me understand please


Vishal Sikka explained in his SAPPHIRE and TECHED keynotes that the general direction for SAP is to collapse the multiple layers that exist today, and move more and more of them natively into HANA. It sounded like a pretty neat idea to me when I heard it, and I did not think more about it for some time. Timo Elliot then mentioned the example of digital photography getting rid of obsolete layers and revolutionizing the industry. In his opinion, HANA will do the same.

Vishal and Timo are two of the most brilliant minds that I admire in the SAP world. But for some reason, a part of me started thinking – is collapsing layers a good idea generally? My education is in mechanical engineering, and not in computer science. So I started thinking along the lines of machine design to see if I can rationalize this somehow. And I failed.
I started an attempt to discuss with Timo about this on twitter, but it is hard to do it 140 characters at a time. And then my flight to PDX started boarding and I had to abruptly end the twitter session and run to the gate. Since I have some time now in the flight to reflect (and type), here goes.

Layers exist for good design reasons. Layers traditionally have been built for some specific purpose, and over time they get very optimized for that one purpose. As technology improves, and smart people get bright ideas – they can replace a given physical layer with something else that is better. But the layer in design time should still remain in most cases. Why? mostly because there are smarter people in every generation who will improve upon this, and Mr Murphy might show up unannounced.

Taking Timo’s example of digital cameras – the physical storage in films got replaced by memory cards. But there is still some storage layer that did not get replaced. Tomorrow something else will come up that is better than these cards, and this layer will further improve. Now – nothing stops a designer from combining thr storage with the body of the camera or the lens or something else. This might be pretty revolutionary – and might outperform other cameras too, and users might love it in short term. But the question is – with this design, can the next generation of designers add on benefits of advancements in each layer that collapsed? To net it out – does performance outweigh the need to maintain and enhance?

Another example is our family car. I love that car – but have had multiple accidents with it in the past. If the manufacturer of the car had decided to collapse layers – my insurance company would have probably paid off the car after the second time it had an accident, and I would have had to cough up more money to buy another car. It just would not have been easy or cost effective to repair it. I would have been pretty mad at this scenario since all but one accident was the other party’s fault. Fellow Indians who moved to the USA might resonate with this – when I grew up in India, we could get everything on my dad’s Ambassador repaired somehow. When the newer cars came up – the concept of repair was mostly rip and replace. It was not affodable for many of us to do this.

In a stable system, it is comprehensible that some layers could be collapsed. Example : BW has aggregates. With HANA, you can aggregate on the fly. So it makes sense to get rid of this layer once BW gets HANA as the DB. But here is the question in my mind – If and when HANA truly becomes big data friendly (petabytes instead of TB), will it help to have a logical definition of an aggregate that will tune the SQL to get a specific aggregation done more efficiently?

We can argue that most of the data in BW is in TB range, and hence this is not needed at this time. But that brings up another question on innovation – is it innovative if you have to constantly tinker with the design? or should innovation stand the test of time? Timo made an excellent point on twitter – innovation does not come in neat buckets. It is hard to argue with that, and I readily agree. But for innovation to be useful – I believe it needs to be moulded into a form that can work for an extended period of time. At a minimum, this should apply to anything that costs customers in the millions.

Even if I somehow convince myself that collapsing layers make sense in a stable system, since we have a good idea of what each layer does and what will happen in foreseable future – can I extend this and believe that this is applicable to newer systems? I am having a hard time convincing myself of this.

HANA is just about a year old or so. Revisions are coming fast and furious to the HANA software. And HANA has an aggressive roadmap to make it work for BW, ECC and so on in a short period of time. It means work needs to be done on many different things that make up HANA (stabiling the core, enhancing the SQL, scaling out and son on). In this scenario – will it be easier for SAP to develop and enhance HANA if more and more layers are brought natively into HANA ? May be it is – I don’t know. I have not worked in software product development. Hopefully some one from that background can explain to me why this is a better idea.

The closest I can relate to is a custom build engagement that I manage, which uses MSFT technologies. The architects followed a multi layered paradigm to build this. It handles mission critical information, and there is very little tolerance for error. We debated many times internally if it was possible to decrease the number of layers to improve coding speed, and performance. My chief architect held firm that each layer has a job to do and it will serve us well if we stuck to it. We agreed on it – and he was right. As soon as first release was done, we had to start on the next one, and there is just no way we would have kept up with enhancements and performance tuning aspects etc if we did not stick to the multi layered architecture.

Sure we could have gained some performance – but in the overall scheme of things, the solution seemed pretty good. But then – this is a project, and not a product. What works in projects might not be the right approach for product development. So I can’t make any firm conclusions based on this experience.

If I knew in my younger days that my career and interests will go this way, I might have skipped my MBA and done a masters in computer science or gone to a design school. Since I did not do that – I guess I have to learn this the hard way by debating this in public, and probably get electronically beaten up 🙂

Gamification Of The Enterprise – post SAP Teched 2011 thoughts and actions


I am a big fan of innojam – despite the pain of sitting through hours of mandatory speeches (after all the sponsors need air time in return for their money and time).  Once we got through the speeches, I had an idea for an enterprise game which I jotted down , and deposited in my pocket. And since I was pretty bored and hungry (ok..and thirsty)  by that time – I looked around, and readily found a bunch of mentors who were ready to go get some dinner. It was the best dinner I ever had at a Teched – and when dinner was over, we were all pretty much psyched enough to go make gamification work.

Actual software part took very little time – between the group we knew HANA, BI 4.0, ECC and so on. And we had some very creative minds who mocked up data, created facebook pages and so on. And then we went around the room,  giving a hard time to other teams. Despite my thick Indian accent, my team “gamely” put me up to go present in front of the judges. We did ok but did not win. I don’t think any one felt bad – we just had more beer, cheered for the winners and went on to the next fun Teched activity.

Once Teched was offer, I started thinking about the possibility of making gamification work in a real business scenario. Since we had more than 10 applications to choose from the innojam – and since we had it on video, and since the memory is still fresh in my mind – I thought why not use these as examples. So I actively checked with people who had an hour to talk to me. I let them watch the video,  explained in more detail – and asked them if this was in real life, will they do it.  Out of 6 people – 1 consultant, 2 power users, 1 IT manager, 1 Solution Architect  and 1 VP level executive –  I got 4 NO and 2 MAYBE as answer.  I tried to give them all the talking points that the gamification keynote speaker used – but still could not convince them that this is useful.  I will try to do this exercise for another week, and see if I can get 4 or 5 more people to sit down and talk to me .

In short – here are the general themes that came out. I am sure I missed a few since this was not a structured survey or anything.

1. I have real games that I like. Why won’t I just play those like I do today?

2.  I don’t want my employer using this to game me. Is this another way to exploit me?

3. Will this lead my team to have unhealthy competition? or will they get carried away and use it to skew real business results ?

4. What happens when they get bored with this game? will productivity drop? What will it cost to keep building new games etc? Can I measure ROI? Even if it works – is there a big upfront change management investment?

5. How can I define a game? I have colleagues in 4 continents and what appears like a game to me might end up as an insult to one of them. Is it worth the trouble to deal with it?

6. With economy not doing well, aren’t people motivated enough to do a good job now? Why bother tinkering with regular business models now and take a chance? Contrary to what consultants tell me – my business has not actually changed fundamentally. is this a way for you guys to skim more money off my company?

 

There are three possibilities I can think of here

1. I did a poor job explaining gamification to these people – since I only know what was conveyed to me a week ago at Teched.

2. The examples at innojam were not enough to resonate with these people

3. Gamification is just another buzzword, and even if I explained better with nicer examples, people will not buy in.

Till I talk to a few more people, I am not going to make any final judgment for my own case. But the questions that came up are all good ones in my opinion.  As always – I am all ears to hear what you folks think.

What does it take for execution success at SAP?


There is a prevailing thought in the ecosystem that SAP scores high on the strategy and vision, and where they need to focus is on execution. This came up in numerous conversations I had with Teched attendees this week. What is not clear is how exactly SAP is going to enhance execution capabilities. About 50% of all conversations I had in Las Vegas was on this topic.

For what it is worth, here are three thoughts on potential solutions, that were formed as a result of my conversations.

1. Cross-pollinate and learn from people who are good at it.

SAP has customers who make mission critical systems and on a deadline.  Why not request their help? Send developers and managers to watch how they work in their environment, and learn. SAP also has a bunch of SI partners, ISV partners etc who also have a lot of experience in delivery excellence.  Of course there are spectacular failures too from customers and partners – but it is a small percentage. It looks bad because headlines do not look as attractive for good news.  This is an easy route for SAP to enhance their execution capabilities.

Also, nothing stops SAP from hiring people from outside to inject new blood into the execution arm. Conversely I think others will benefit a great deal by getting some experts from SAP  into their teams.  The risk is that if not done properly – this could end up as unhealthy talent poaching which won’t help any one.

2. Include ecosystem in development and testing


Some variation of the APPLE model might work for SAP. SAP technologies have a big fan base. Current licensing models do not allow this really large pool of smart people to contribute to getting more and better SAP applications.  Sure there are legal and financial and infrastructure issues to be dealt with – but those can be dealt with if the leadership at SAP has the conviction and will to get it done.

SAP is quite good at working with customers on getting ideas for what products/features/functions etc are needed next. And they have a ramp up process which is quite good too.  However, there is a missed opportunity in using a vast ecosystem in testing.  And SDN is a great platform to get access to a large number of people who might be able to help with this, probably for free.  Why not allow software to be freely downloaded as trial versions? and if Cloud is the way SAP is going – why not host these and let SCN members play with it?

3. Industrialize innovation

Innovation should matter to the company in some measurable way.  Sure it is fun to do gamification innojams, and a couple of  apps in HANA a year. That will not add $$ to topline or bottom line. For that – innovation needs to be focused, and the process should be industrialized.

A good example is LOB on demand products.  Sales on demand, Career on demand etc are all very good – and have some of the best people at SAP doing their best to make it succeed. But they are too few to make it count. My gut feeling is that each takes couple of years to get to market, and then in another two years or so – they might make $100M or so. I could be wrong – and am glad to stand corrected. But at this scale – how much (and when) will it affect a $15 Billion company’s financials ?

Can SAP take the learning from first 2 or 3 OD apps, and get into  tens of applications being developed in parallel ? Can those be applied to HANA and Mobility applications too in some convergent fashion? I know SAP is big on agile and design thinking and other fancy ideas. Question is – do they scale to an extent that it moves the needle significantly for SAP?

As we recently joked towards the end of the HANA skills podcast with Jon Reed and Harald Reiter, we need some “action leaders”  to balance all the “gurus”, “thought leaders” and “visionaries”.

Some difficulties of making inclusion work


Yesterday, there was a terrific event at SAP Teched on inclusion, and design thinking. I was invited to be on the panel, but unfortunately could not make it in the last minute. This is just a short post to share my thoughts on that, since I could not discuss it live and learn from the panel and the audience.

 

When I started in SAP in the 90’s , Indians were a minority in this space.  I also remember the joy when I was included in teams where I felt excluded from. I have several accomplished women in my family (including my mother)  who did well in life, despite all the challenges life threw their way. As a result, inclusion naturally is very close to my heart. Even though I do believe inclusion is the right thing to do for many reasons, I see a few challenges to make it work effectively in an organization.

 

1. It is all about priorities

 

There is usually something else that is more important than inclusion for a given team. An example is the inclusion event yesterday – it could only be done with a small percentage of Teched attendees, due to budget, timelines etc.  Oranizations, teams and projects all have such constraints, and they might trump inclusion. This may be somewhat countered by mandatory inclusion by policy or law.  But laws might apply only to macro scenarios – a company might want something like number of women to increase by two times in next year. But does that mean HR, Finance and IT will all have twice as many women as they have today? Usually not. If not, then does it really help the whole organization despite championing inclusion?

 

2. Can you have ground rules? and who sets them?

 

Rules are the opposite of inclusion. Rules by definition, exist to exclude something or someone. But without rules – there will be chaos. So who decides which rules are inclusion friendly and which do not? Just by choosing someone to decide this – you are excluding some one else.

 

3. Inclusion for who?

 

Proponents of inclusion can have a bias depending on their own background. Women might think they are the ones that need to be included, racial or social or economic minorities might decide it is them that needs to be included and so on. It does not always end in a win-win situation for all parties.  And obviously, it is pretty darn hard to have every combination of inclusion work in a situation. So someone loses out and will feel they are not included.

 

4. What about the majority?

 

I have only seen opinion articles on inclusion – and not real conclusive research. I will continue to look for it. But there seems to be a thought out there that just by doing inclusion – will you decrease the effectiveness of a team?  Hypothetically – a team of people from one country that have worked together for a while, might not necessarily like a person from another country to be suddenly put in the team , even if he/she can do the job just as well. Over the long term, this will probably be ok – but there is a big risk that short time productivity will get a downward trend. How many managers and teams with short term deadlines will take this chance of decrease in productivity?

 

5. What is the link to design thinking?

 

Will inclusion help design thinking? I have some reservations. In general – if you have more ideas to choose from, you might get a better solution. But then again – what kind of inclusion will work?  Say you want a product that is designed primarily for men. Will a team of women be able to design it well? may be they could use a few men in the design process? That is inclusion – I agree. But inclusion can also be adding more Chinese and Japanese team members to the team. Would that inclusion make the design any better? I doubt it.  So it can be argued that inclusion as a general principle has limitations, and you need more filters. And once you filter like this – can it be called inclusion at all?

 

I am sure there are solutions to all of these – and I am speaking to a few people today to find out their perspective on this topic, and solutions they have seen to these problems.  It is way too important an issue to leave open for long.

SAP Teched 2011 – Monday and Tuesday. Hana, Hana and MORE HANA


Sunday was all about innojam. Theme : gamification (is that a word???) of the enterprise. And No – it was not based on “The games people play”. There were 13 teams…well, 12 serious teams and then us – the #PUKR team. PUKR stands for Puppies, Kittens, Unicorns and Rainbows.  To follow us https://www.facebook.com/pages/PuppiesUnicornsKittensandRainbows/123156007786007 . Our idea was to gamify the framework – so that you can gamify any business process. What can we say – we were ahead of our times, and the world did not see our vision. Especially the judges .

 

Jokes apart – it was a blast. 10 SAP mentors came together to put a solution together that had everything from a spec ( 1 page of backlog, half page datamodel), facebook page, twitter comments..and other assorted things like ECC, Webservices, HANA and BI 4.0.

 

The team that won did an awesome app on gamifying the expense reporting process.  And it had HANA and 2 IBMers and an SAP guy in the team. How much more do you need for sheer awesomeness? These guys went up to compete in demojam, but lost to an even more awesome team.

 

Monday night – we had the SAP Mentor reception. Which was the first time I got to eat something in 24 hours or so.  Aslann and Mark Finnern put up a great event for Mentors as always. And we had a surprise visitor – Vishal Sikka. He gave us some thoughts on the keynote that he was planning to deliver the next day. He also acknowledged that I had given him some grief on twitter for not responding to blog comments 🙂

 

I do think that it is a wasted opportunity for Vishal in particular and for SAP in general. SCN is the place where there is an even bigger brain trust than within the SAP labs.  Blog posts are just the start of a conversation. If you do not respond to the questions and observations made there – the blog just becomes something like a press release, but with a dab of lipstick. Of course Vishal is a busy guy – so maybe some one in his team can collect these questions, and Vishal can post a blog with replies.  Or find some other solution – but leaving these comments open does not seem like a good idea to me.  Knowing the guy – I will not be surprised to see him start responding to those questions.

 

Onwards to Monday – starting with the big keynote from Vishal Sikka. I was happy with the keynote.SAP did well.

 

1. SAP did the right thing by showcasing the two Asian customers who went live on HANA.  BRILLIANT !

2. Vishal reconfirmed the 9/16/11 date for GA for BI 4.0 .  Not sure why it could not have been 9/13 right at the Keynote, but I assume there is a good reason

3. HANA goes under BW as DB 53 days from now. This is probably the most exciting news for me personally.

4. Vishal clearly articulated his vision for ongoing intellectual renewal, and I got a feeling it resonated well with the crowd.

 

There were a few things about HANA that need attention too.

 

1.  It is all about HANA for sure. Mobility and cloud got some minor mentions, but guess what – customers have real budgets for those things. Mobility today is not a hard sell – I think SAP needs to focus messaging more on these two.

 

2. During the innojam – there were 4 tables created in HANA I think. Two were from my team and one from the team that won the innojam. Someone else must have created one more. We had Vitaliy, Harald and me in the room, and 3 SAP HANA experts. There was no visible traction for HANA there. People crowded around River and Gateway, but did not seem to want to deal with HANA.  When asked in keynote to raise hands for those planning to use HANA – a very small number of people obliged. I urge the HANA team at SAP to start actively engaging on SDN and other channels to get this fixed.

 

3. HANA needs serious datamodelling. Hand written DDL has limitations to scale. SAP needs to actively enhance the Sybase power designer (which I think is the name) and teach the ecosystem how to use it.

 

4.  Not sure if I heard this correctly, but the Asian customer who implemented HANA seemed to have done it all inhouse. If this is true, it is mighty impressive. But having worked with HANA myself, I cannot visualize how they managed to do this without active participation of SAP (maybe an SI too). I need to find out more.

 

5. How far does HANA scale ?  So far I have seen the several TB of data examples. But that is not big data in 2011. Can it work with Petabytes?

 

Just as I mentioned in my SAPPHIRE blog, I fail to understand why SAP is not promoting Gateway actively. I walked around asking people on their opinion on gateway. Very very few know what it is. It is a shame – and SAP should fix it.

 

I had an opportunity to catch up more with Vishal Sikka over lunch.  Many thanks to Mike Prosceno and Stacy Fish for making that happen.  That conversation was off the record, but I can say one thing for sure. SAP will make HANA work – and SAP could not have got a more passionate guy than Vishal to lead the charge. He knows the problems along the way – and he is fixing them as efficiently as he can.

 

After lunch meeting with Vishal, we had a blogger meeting with Nicholas Brown – from the mobility side of the house. He is a terrific guy – and an absolute straight shooter. It is a high potential area for SAP and I heard they have been doing well. Nic does not think HTML 5 is the magic bullet every one thinks it will be. He articulated well that there is a class of apps that will do well – like leave requests and time sheets, that BYOD folks will use en-masse. But there will always be a set of users who need native functionality of devices to do more complex things. Plus – the key question is “what is in it for the device makers?”.

 

There are 50 plus apps in various phases of development – so I believe SAP field sales now have enough ammunition to sell mobility well. They will not have to do a multitude of POCs to get customers to buy the SUP platform probably. But here is the deal – what is the model for the sale? Will you sell the 50K or 100K deals for one app development? or will you sell a whole mobility strategy and make a few millions of sale? I guess they will do both. But each requires a different partnership with ecosystem to make it work. For the large SIs – the strategy route might be more palatable, and for smaller boutiques – the one or two apps might be the better business. But in general – I think mobility has a bright future. I just hope SAP gives it sufficient attention, given the major focus on HANA.

 

One last point – to make mobility and HANA and cloud a success – SAP cannot do it alone. SAP probably cannot do it with existing partners alone either.  For the type of scale that will move SAP from a 15B company to something bigger and more profitable, and less reliant on maintenance $$ – they need some variation of the AAPL model to get a large pool of developers into the ecosystem.  This does not go well with current way of functioning SAP is used to. But all the leaders know it, and I hope they will figure out a solution. But a problem SAP can solve in near future is to make sure existing partners and customers have access to latest greatest documentation and training on all the new stuff they are coming up with. They cannot have education lag behind innovation by a big margin.

 

Demojam was the last event of the night.  I am quite amazed by the quality of the demos – very very cool. You should watch them all, and if possible talk to the finalists.  The winning demo was the best I have seen in a few years. Watch the videos and you will like it too.

 

On that note, I am off to the Wednesday sessions. See you tomorrow.

 

 

 

 

 

 

 

Sunday at SAPTeched 2011 – It is all about Innojam


On the 10th anniversary of 9/11, I took the first flight out of PHX to LAS to join fellow mentors and other SAP enthusiasts at SAPTeched.  I was happy to see people choosing to fly on this day – it sends a strong message to the world that Terrorism will NEVER win.

 

The day was all about Innojam , and Innojam is all about gamification this year. Mario started us with a good overview of what the concept is, and Sethu M did a good overview of SAP strategy.

 

I was part of last year’s innojam too, and its previous incarnation called process slam. SAP has listened to feedback, and there was marked improvement from previous years.  I would really like less PPT and lectures and more action in innojams, since the rest of the week is anyway PPT packed. We spent quite a bit of time this year too – although it was less than prior years. Next year, SAP should consider timing out people who make pitches that take more than 2 minutes or so. There were times when 50% of the room was just posting on twitter – including me – and not paying attention to what was going on in the room. Food looked better than last year, but some of us still ate from outside.

 

If there is one thing SAP should be shouting from rooftops – that is their Gateway offering. It is the most awesome innovation I have seen from SAP in a while, and more customers can use it than almost any other technology I can think of. I hope to see Vishal doing this in keynote, and not just talking about HANA.

 

We have more than 10 teams competing in innojam, and after the best dinner I had at Vegas – I got to be part of an innojam idea too. We are using HANA, BI 4.0, ABAP and Mobility to pull off gamification. And it has been nothing short of fun to say the least. The dinner conversation have to be left private for now – but I will definitely go out any  time with this gang. I don’t think I ever had a better night in Vegas ever. Please follow #sapteched for some fun twitter streams yestreday, and more for rest of the week.

 

There are 2 major activities for me  for Monday .

 

1. Attending Mobility deepdive

 

2. Finishing up innojam idea and presenting it at the final – thanks to a team of rockstars, this is a piece of cake.  If this team actually works on a real project together, Mike Krigsman will probably start blogging more on IT Success stories instead of failures 🙂

 

And finally – many thanks for SAP for inviting me to this event, and paying for registration and hotel.

Innovation and the Time dimension


On labor day, I was vacationing in CO, and picked up this blog post by Vinnie Mirchandani ( @dealarchitect on twitter) to read while my family was getting ready for the day’s activities. http://dealarchitect.typepad.com/deal_architect/2011/09/ibm-we-need-more-innovators-less-integrators.html . Vinnie had earlier penned http://www.enterpriseirregulars.com/40863/we-need-more-applegoogleamazon-moments-less-ibm-moments/. I picked up a lively and healthy debate with Vinnie on twitter, and then Martijn Linssen joined in.  He is @martinlinssen on twitter, and I am @vijayasankarv.

 

Vinnie is a well respected analyst in the industry, as is totally entitled to his opinion. However, I do think the thought process in this case has some flaws.  I have an equal amount of respect for Martijn, and respect his opinions as well. We had to stop the twitter debate abruptly since I had promised to take my daughter to the zoo.

 

So here is me picking up that thread. I do work for IBM since 2006, and am very proud to be an IBMer. However, these are just my opinions, and not that of IBM’s .

 

How does one define innovation? Vinnie gives his metric to define innovation here.

How much of IBM’s revenues comes from new products innovated in the last 5 years? Because that is the benchmark that Apple and Google and Amazon blow IBM away on as what I consider a legitimate claim to innovation

 

I think it is a really bad metric to judge innovation of an enterprise company.  Here are a few reasons why.

 

First off – I truly admire Apple, Google and Amazon for what they have done and what they are doing. They truly deserve the accolades Vinnie and others bestow.  I use them all as a consumer, and am happy with all of them.

 

However, Apple comes up with a new product version say every year or less – like the iPad. Since it is a brilliant product, a lot of consumers pay about $1000 give or take each year to buy the next version . That is pretty much a 100% recurring annual cost. Enterprise customers cannot even tolerate 22% maintenance fees. How many vendors can manage to get a savvy enterprise customer to fork 100% every year for the next big thing?  And unlike the consumer world, the enterprise world generally needs backward compatibility.

 

Martijn made a point that IBM thrives because of great sales skills. I questioned that asking him how many customers will stick with a vendor for long term just because the sales people were rockstars. Martijn came back with some good points – mentioning shelfware and government contracts. Even if both are true, what percentage of the $100B revenue will come from shelfware and government? I think the reason IBM survived a 100 years – most of them as a leader – is that great sales was paired with greater delivery.

 

IBM developed Sabre for American airlines many decades ago – before I was born. And it is still being used widely – and not just for airline reservations. That is innovation that has withstood the test of time. It did not need annual revisions that cost 100% more money from customer every year.  If I am an enterprise customer – which one would I like? something that changes every year, and costs me practically 100% of my initial investment every year? or something that I buy once and pay a much smaller maintenance fee annually to keep up to date for decades?

 

Apple revolutionized how we consume music with iPods. iPhone and iPad were phenomenal successes as well. And they came out in a span of few years or less of each other. Very impressive. But guess who started an entire industry around personal computers? IBM did.  And how many years did it take for the next big thing to come up? a few decades.  An investment in a PC is not something people did in a recurring fashion every year. And even with mobile devices catching up – PC is not exactly dying.  Doesn’t that count as innovative? Or is it not innovative because it was not done in last 5 years?

 

By the same token, IBM sold off its PC division to Lenovo in 2005 when they figured that the margins of that business were not going to help take IBM to the next level. Wasn’t that brilliant for the shareholders that IBM invested in high margin services and software instead of low margin PC business? And Lenovo is a very successful company too and shows good numbers to its investors.  Why is that not innovative?

 

Vinnie goes on to say

IBM prides itself as supporting and leveraging Open source but cordons it off from its own proprietary and profitable products.

 

So is it Apple that is the shining example of all things open? Apple decides what works and does not work with their products. It is not open, and it can get away with it in consumer space. IBM is way more open in its products – and supports multiple systems to integrate with its products. Sure it can be argued that it could integrate more – but the point is, it is fairly open, and has been an active proponent of open standards.

 

Vinnie makes a point of IBM as more of an integrator than an innovator.  He says

If IBM was truly innovative it would be automating and commoditizing much of that labor – its own and that of the rest of the market.

 

Here – there are 2 issues. Is it bad to be an integrator? I would categorically say NO, especially if you are the best (or one of the best) in your business. Second – IBM has very innovative service solutions. IBM does not solve services problems by just throwing warm bodies at it. They are one of the few companies that bring high-end consulting, software, assets, hardware  and research capabilities all together to solve the complex problems of its customers.  It is a large company, and hence many people have different perspectives on IBM. Some exceptional, some good and some bad and some really really bad. Bad press gets more publicity – but that does not take away anything from a company that has been an icon for a 100 years.

 

Vinnie’s blog closes of with this

What I find disconcerting is that even at the top IBM confuses its nice margins from milking old software and old data centers and old partners like SAP as “innovation”. This WSJ article I should  have written about a while ago summarizes that state of delusion.

 

Sure SAP is  a few decades old. Sure it could also be more innovative like everyone else. But one should also not forget that a good portion of Global business runs on SAP. And IBM is one of the biggest partners of SAP globally. ERP projects get a lot of bad rap for being costly to implement and maintain. But the number of successful projects definitely outnumber the unsuccessful ones, although it hardly ever gets reported on.  And OLD does not mean BAD if it still works effectively. Sockets API for Unix was unchanged for a long time since it was written. Was it BAD? Full disclosure : For most of my life, I did SAP consulting. So I probably am biased on this topic 🙂

 

If Lotus is 20 years old, what about Microsoft office?  Why do customers use something that originated more than a decade ago? Shouldn’t that be anti-innovation too?

 

Martijn said HP invests more in R&D than IBM, and so does many other companies. Not sure if that is a fact – but I do know that IBM invests quite a bit on R&D, and in terms of number of patents and number of PhDs employed, I wonder how many other companies will come close. And how many other companies have 5 Nobel prize winners?  Does that sound like sustained investing in innovation?

 

Of course IBM has had its fair share of challenges. When I did my MBA, we used to discuss endlessly how IBM nearly died, and how it strongly came back. So I am not saying it doesn’t have its problems. But irrespective of all that – I firmly believe that IBM is one of the most innovative companies in the world. In fact, it is one of the core values of IBMers

Innovation that matters- for our company and for the world.