Shelf life of innovaton


To begin with – I wonder if someone will argue with me if I just say “there are only so many original ideas in this world”.  I am sure someone would – I can think of a few people I know on social media who hold a different view. In any case – I firmly believe original ideas are limited.

But is innovation a term to define an original idea? I am not sure – partly because I am not a scholar in English language.  I cannot draw a firm difference between invention and innovation when it comes to an original idea. The idea of invention and innovation is to improve something in general.

If someone comes up with a cure for cancer – we will probably call it an invention. And when the next person comes up with an even better way to cure cancer – it gets called an innovation, or less charitably – an improvement. And the judgement passed on this is not done by the cancer patient who got cured or the doctor who treated the patient. It will be done by authors, analysts, scientific community etc – all of whom are a degree or two or more separated from what actually happened. Whether we call it invention, miracle, innovation, minor improvement or a waste of time and money all depends on the eye/tongue/keyboard of the beholder.

What is innovation then?  It is a comparison to status-quo, isn’t it? If I do something better today than yesterday, I have done some innovation. But will anyone other than me agree that it is innovation? Should I wait to call it innovation till I find a few more people to agree with me? If making money is key – then yeah, I suppose a few people should agree with me. These should be buyers, people who influence buyers etc.  This also explains why vendors shout out about innovation before any customers benefit from their wares. Good for them.

What is forgotten in this dialogue (err..monologue since I am the only one “talking” here now) is the time dimension of innovation – or more accurately, the shelf life of innovation.  So I and a few others get to agree that what I just produced can be called innovation.  And someone is willing to pay money to get it. As time progresses, I keep tweaking my product (to keep getting some money to earn a profit, to fund new projects, to go to Australia to watch a boxing day test match and so on) . Will each tweak be called innovative? Or because I did innovation once, will I continue to be known as an innovator?

From the money point – there are two ways I can make money. I can charge money for tweaks by charging a maintenance fee (the type SW companies do) or I can bring a new version every now and then and convince customers to (optionally) pass down old ones and buy new ones (like car companies, Apple etc do).  As a customer, I prefer the former model where I get everything I need for a smaller price tag every year, as opposed to spending money (equal to or more than original investment)  again to buy the next version.  Companies who charge a maintenance revenue are tagged with “improvements” and companies that make you buy the new version all over again are tagged “innovators” or even “inventors”.  Am I the only one who thinks this is strange?

For me as a vendor – if making money is my prime objective, the latter model is probably better.  Of course I cannot do this one product – I will need a portfolio of products so that no one product can sink the ship if it fails to sell. I also need a brand that holds significant value and loyalty. Car companies and Apple have proven that this is a workable model. I have several friends who have bought iPads every time Apple had a new model. I also know many friends who for generations have bought Chevy, Ford or BMW.   I don’t have any friend who buys cars from Chevy, Ford or BMW every time there is a new model though 🙂

This model is rarely seen in software side. The successful companies like IBM, SAP, MS all have made excellent software – used by millions of users for their daily jobs. Their solutions have long shelf life. And they charge a maintenance fee to provide improvements and support over time.  They also come up with new solutions that fetch more upfront money than the annual maintenance.  But since they don’t make people buy new models every few months – they almost never get any credit for innovation like Apple from the analyst/blogger community.

The criticism on”incremental-ism” is not without merit – customers are not always given sufficient “big enough” changes all the time. Vendors need to address that. However – it is not as if customers use what is available already all the time either. If I take SAP as an example – very few customers take time to find out what is available to them in Enhancement packages that they can use to improve their business process.  And only a few go on all the way to implement it unless forced by laws and regulations etc.  Vendors know this – so they strike a balance on how much they will improve existing products vs invest in new ones. Of course when they come up with new ones – there are people (like me) who will question its maturity.  There is no easy answer here.

One last thing – adding “disruptive” to innovation. I believe this idea of “disruptive innovation” came from Clay Christensen.  I do agree it is a neat idea. Where I differ from some other people is the frequency at which disruption can be done without losing efficiency of doing business.  I cannot get my head around the notion of a business surviving technology disruptions every year in the name of innovation. But listening to some experts on the topic – and resisting the temptation to name names – I constantly get this feeling that they expect customers to be friendly to this idea of constant change.  I know a CIO who had to fight more than a year to convince his company to let go of on-premises MS office and go to a cloud based office 360 solution. I doubt he can fight 5 such battles a year.

Just when I was all tired about the innovation – I spoke to an ex-colleague on phone. He says that the need to be innovative is so yesterday. His company is now moving on to be inventive.  That is the new cool kid now it seems. At least can we go back and talk about “Synergy” or something again , or is retro not cool anymore either?

 

 

Happy First Birthday SAP HANA !


So on Monday, Hana celebrates first birthday ! I will be in Palo Alto to be part of the celebration.  It is amazing that one year has passed since the GA announcement came for HANA. Looking back over the last year, SAP can definitely be proud. They put their heart and soul into it – from Hasso, Jim, BIll and Vishal to all the way down the labs and sales organization hierarchies.

I have had many discussions with Hasso and Vishal on Hana in the past couple of years. Their passion is infectious – and they have an excellent vision on where Hana will take SAP to.  Vishal has a rockstar team – and I know most of them, and that talent runs deep many layers down the hierarchy. Engineering for Hana is definitely in good hands – and as time progresses, it will only get better.

Hype or not – last year showed  the power of good PR and marketing. Jonathan Becher deserves major kudos for this. Same goes for the global communications people under Hubertus Kuelps and Mike Prosceno. Without their extreme effort, Hana probably would not have had the coverage it got amongst analysts, bloggers etc. The power of social media was fully utilized for HANA – probably more than any other product before it.  It is now in a state where if someone has a question about HANA on twitter, some one from the ecosystem can clarify most of the times without needing an SAP person to jump in.

On the sales front – they got the best GM for the job in Steve Lucas. He is a solid leader and an excellent communicator, and is supported by an amazing team. They are going all out to sell Hana to customers. And from what I have seen – they have all the support from Enslin, Poonen and other big executives.

SAP also got around to enabling HANA developers on the cloud. That is a great step in the right direction. Another thing that excites me a lot is the set of Hana start up companies that SAP is supporting. Again – a great step.

The one area I am not equally happy about is SAP education for HANA. I saw somewhere that 2000 people are certified. I seriously doubt even if half those people can hold their own in a HANA project. Education needs to keep pace with product, not lag it . Parts of SAP like the CSA team have done a fair bit to help partners keep pace, but that is not sufficient. If education does not contribute in a significant way – several of those projects that start now will end in disasters next year, and none of us want that. I was extremely happy to talk to Marcus Schwarz few days ago. He is the SVP leading SAP education. He understands this better than me, and he is doing all he can to turn this around.

Last I heard , they have about 350 Hana customers and about 140+ live installations.  That is not bad for a product that is only a year old by any stretch. The question is how much of acceleration will Hana see in 2012 and beyond? Will it be what moves the needle for SAP in a big way in terms of  revenue and profit?  I am cautiously optimistic.

Hana works now as one of the possible databases for BW.  There are apparently something like 17000 BW installations around the world.  If half of these customers will switch their databases to hana – that itself will make the investment SAP made in HANA worthwhile.  But that is not easy to pull off for many reasons

1.  Other DB vendors will do all they can to prevent erosion of their instal base. And they are all bigger companies than SAP with more money to throw at communications and product development. Interestingly, they are all good partners of SAP too. So it will be a fun dance to watch from the cheap stands.

2. Not all BW installations have the prospect for a big sale due to size of DB. So SAP will need short sales cycles to get them to act. This is not easy in several cases since SAP has not actively sold BW in the past. I haven’t seen a lot of SAP sales people articulate value of BW on HANA in a convincing manner.

3. Kind of related to above, and it is about SI partners. Despite the top leaders trying their best – partners have not really had a significant role in HANA yet. Unlike SAP themselves, SIs have articulated BW before and this is their game. By not removing the hurdles for SIs, SAP will slow down the uptake of HANA as a BW database. This is changing, but not at a pace I would like to see.

4. Although I have no real idea why – it was clear this past week on twitter that several people, including some SAP Mentors and big customers of SAP, still think HANA replaces BW.  Steve Lucas posted an excellent blog, and I wrote parts of it. https://www.experiencesaphana.com/community/blogs/blog/2012/06/13/does-sap-hana-replace-bw-hint-no but that did not seem to help since questions keep coming on twitter. I also did a podcast with my DSL buddies on this topic – http://dslayer.net/dslayer/view/130-big-data-hana-vs-iq and guess that did not help either . I guess this will not get solved easily when SAP influencers themselves are not clear on the details.

5. Some of the HA questions did get answered after Hasso’s keynote showed a live demo. But there are plenty of people who need more convincing on data center sturdiness of Hana. SAP needs to step up its efforts big time on this front – and fast.

6. SAP also needs to articulate the IQ vs HANA some more. Generic statements doesn’t help. Listen to the podcast link above and listen to Clint and the DSL guys.

By end of this year, SAP will announce ECC running on HANA in some form.  On the sales and communication side – SAP will hopefully manage to fine tune its act with BW so that they can go all out for ECC. In my view, ECC on HANA is not a big deal really for customers. Not everything in ECC will benefit from having HANA as the DB. Some long running batch jobs etc might improve – but I cannot imagine the majority of ECC functionality benefiting from HANA. However, for HANA to gain credibility as a pure database compared to Oracle, DB2, MS etc – it needs to work on ECC. And for that reason – I think it is necessary for SAP to get HANA on ECC right.

Finally the quest for the killer apps continue. BPC on HANA so far is the best application I have seen, and that will evolve more with time. But given the developer and start up enablement – I hope this is just a temporary issue.

So – Happy First Birthday SAP HANA ! I am looking forward to celebrating with everyone at Palo Alto and Monday, and many happy returns of the day.

 

SAPPHIRENOW 2012 – View from the top, with Joseph A Bellissimo of IBM


In my last post, I had included 2 videos I did with John Leffler of IBM. This time, I am including a short video with Joseph (Jay) A Bellissimo .

Jay Bellissimo is the Managing Partner of the Global SAP practice at IBM Global Business Services.  He grew his career up the ranks via the technical path. He started in COBOL programming etc back in the day, and was a strong expert in SAP Basis from early 90s. He ran the COE for SAP when it was first founded. As he progressed in his career and became a Partner, he started taking up several business leadership roles including Geographic, Sector and Service Area ones. Jay has a truly international career – and has spent many years living in different countries and working with our global customers in various industries.

A lot of SAP technical consultants , including me at some point too, have wondered if there is a future for them in this field. People like Jay and Chuck Kichler (our CTO – and with whom I am planning to shoot a video soon) are prime examples of folks who had successful careers by taking the technical route.

I caught up with Jay right after the keynotes, and my friend Kris Ferrari shot this with her flipcam inside a conference room in the show floor. Huge thanks to my buddy Dennis Howlett for his editing expertise. I enjoyed the conversation a lot, and I hope you will find his perspective valuable too.