Just one month after Hurricane Sandy roared through New York City, SAP’s NYC office hosted SAP’s first-ever small and medium sized enterprise (SME) summit yesterday. To kick off the summit, a lively “Power of Small” panel discussion, which included SAP Co-CEO Bill McDermott and the Regional Administrator of the US Small Business Administration, focused on SME recovery after the hurricane and other strategies to help SMEs remain competitive._AWC1483.jpg

 

The one-and-a-half hour discussion took place in front of media, analysts, small business owners and other influencers, and was streamed to the Web.  Hubertus Kuelps of SAP moderated.

 

Kathryn Wylde of The Partnership for New York City answered audience concerns about small businesses hurt by Hurricane Sandy.  Wylde provided encouraging information and recommended small business owners communicate with the NYC Economic Development Corporation and their respective borough’s Chamber of Commerce.  Jorge Silva-Puras of the Small Business Administration also articulated an optimistic standing on the health of SMEs in the US.  Silva-Puras said the small business community has not only grown and recovered over the last several years but also added two thirds of the United States’ recent job growth.

 

 

A former small business owner himself, SAP Co-CEO Bill McDermott highlighted the role technology plays for SMEs.  From cash registers to cloud software, McDermott made it clear that technology is central to SMEs everywhere.  SAP solutions-which were exhibited in the latter half of the SME Summit-allow small businesses to grow into larger, more profitable businesses.  Panelist John Evarts of Mediafly agreed that technology like SAP’s in-memory solutions greatly help small startups transform into “scale-ups” like his own.

 

Speaking of startups, McDermott announced that SAP has powered over 150 startups in Silicon Valley with SAP HANA, which enables entrepreneurs and SME owners to make fast and informed business decisions.  Cloud and mobile applications powered by SAP were demonstrated throughout the Summit. 

 

SAP’s “Power of Small” panelists also illuminated public policy and human capital as factors that make or break small businesses.  Sunil Hirani of trueEX expressed concern over immigration policies and the effect they often have on entrepreneurship and SME success in the US. With nearly one third of New York’s SMEs owned by immigrants and millions of immigrant entrepreneurs, most panelists agreed this policy should be reexamined to ensure SMEs thrive.

 

Linda Rottenberg of Endeavor highlighted the importance of people and human capital for SME survival.  Rottenberg believes encouraging mentors or “mentor capital” is a crucial factor for the livelihood of businesses and embodies that belief in her global nonprofit.  Bill McDermott announced that SAP has committed to Endeavor and its mission to catalyze long-term economic growth by selecting, mentoring, and accelerating the best high-impact entrepreneurs around the world. McDermott said SAP’s ecosystem thrives on the “power of small” because small businesses, which have intellectual capacities far beyond their larger counterparts, compromise 88% of SAP’s new business portfolio.

 

The “Power of Small” Roundtable made it clear that policy, people, capital and technology drive small business growth.  What is often overlooked, McDermott pointed out, is the spirit of a leader with a big idea.

 

Watch the re-play of the roundtable here.

 

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With more than 20 million people, Mumbai is one of the most populated urban regions in the world. To provide safety and services to its citizens, the megacity relies on one of the largest SAP installations in a municipal operation worldwide. In the following video, learn how The Municipal Corporation of Greater Mumbai runs better with a state-of-the-art disaster management unit.

 

Steveson.pngEric Lai’s recent post entitled “Your CMO May Be Your New CIO (And What That Means For Enterprise Mobility)” was a great read. During the same week it was published, I had the pleasure of attending a presentation by Kimberly Stevenson, CIO of Intel, and I was tempted to consider the inverse: Is Your CIO the Next CMO?

 

Techie-meets-marketer

 

One of the first things Stevenson said was that she believes her most important role is to be the voice of the customer. She spoke compellingly of major trends impacting all of us (cloud, consumerization of IT, big data, social computing, the need for / expectation of velocity, user experience). With bold examples and articulate arguments, she explained that “transforming the world” has become the new normal. “Disrupt, or become disrupted” was the choice she offered to the audience. She was a vivid story-teller.

 

 

She went on to say that transforming the world is the role, and in fact the mission, of IT professionals. “Organizations expect IT not only to keep pace with these expectations, but to be the enabler.”This all sounds quite “marketing-esque”.

 

C-suite musical chairs

 

Technology is a disrupter that is re-shaping virtually every industry.  If Gartner’s prediction is true, and the CMO is poised to spend more on technology than the CIO, perhaps a customer-centric, technology savvy CIO is well positioned to trade places with his or her Marketing counterpart. 

 

I was not the only one who was impressed with Stevenson’s presentation:

 

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Stevenson, of course, IS a marketer for her company, which is as it should be. In a world where technology-enabled innovation creates competitive advantage, I think a strong CIO / CMO partnership and collaboration is actually the best way to get to the magic.

273950_l_srgb_s_gl-1.jpgTechnological innovation and digitization have given companies the opportunity to develop new extremely profitable services. Business leaders who want to transform their business models to new hyper-connected services can be precise and eloquent on their need to escape the commoditization trap, but rare are those who 12 or 18 months later have successfully made decisive progress, built platforms, and launched their offerings. Some have succeeded by getting new targeted services to market quickly, ensuring that these services are right for their customers and their third party partners while managing uncertainty with the flexibility to adapt and customize.

 

 

What should companies be focusing on when considering these radical business model transformations?


A leading global provider of printing solutions and services was suffering loss of market share due to new market entrants that were offering much lower cost bases. Simultaneously, they recognized that enterprise customers were under pressure to comply with environmental regulations by reducing their paper and electricity usage. The printing solutions provider honed in on these needs and launched attractive Managed Print Services that supported thousands of networked printers per customer via a new outsourced business model. With this new connected service, customers no longer had to buy machines, but paid for the actual value delivered based on multiple attributes that determined the price per page. Leveraging the rise of ubiquitous secure connectivity allowed them to continue innovating through the launch of advanced mobile and cloud-based services such as Print to Remote offerings. Being able to dynamically and flexibly monetize new services helped them grow their business to a multi-billion dollar operation in just a few years.

 

 

 

How to get started in launching a “market testable” prototype within 12 to 24 months

 

In my experience, companies succeed in transforming their business models when they overcome some key challenges: first, they identify a well-defined and narrow market that does not expose the entire company; then they recognize their existing value drivers and establish how much of the newly created value will be shared with the customers; next, they quickly allocate resources despite the uncertainty of the profitability outcomes of these new services.

 

Indeed, it is essential to set up a cross-company business unit that pulls talent from all departments - Sales, Marketing, Research, Finance, IT, HR - and gather strong executive support to protect these financial and human resources from the drain of more mature units. Analysts refer to this Culture Shock as one of the main hurdles to getting services launched. Accenture talks about this in their report on transforming business models.

 

 

The value and success of these hyper-connected transformative models are extremely interlinked with the technology platform that monetizes and enables them. When selling new innovative services, tweaking and optimizing pricing and creating tailored packages from various options are vital processes for ensuring the profitability of new business models. This can be a sustainable method for targeting, attracting and retaining customers and can keep enterprises ahead of the competition as long as the technology can support the model. 

 

By choosing the right technology, we have seen customers reduce the time it takes to react to competitive offers and launch new services from many months to a couple of weeks! The Accenture report suggests a cohesive digital platform that offers the flexibility, ease of use and speed for maximizing this profitability equation. Indeed, in the launch of connected services that transform business models, the underlying technology platform is more than ever a competitive weapon. 

 

As our printing solution provider and other successful transformers in the services industries have shown, getting this formula of speed, well-defined value propositions and service monetizing technology into place for a targeted part of the business is key to launching a company-wide transformation.

 

Expanding these models profitably is achievable; the crucial part is getting started!

 

 

So, when will you get started?

africastartupsmall.pngGetting traction for exciting new ideas can be a challenge for even the most brilliant and tenacious technology developers. But as I’ve written before, small and mid-size businesses are the lifeblood of the economy in many ways. This is why SAP Africa is inviting start-up companies interested in developing solutions on top of SAP HANA to participate in its first-ever African Startup Forum. Slated for launch on January 30, 2013, the forum is part of SAP’s global strategy to empower start-ups and entrepreneurs in growing their businesses. Closing date for registrations is December 12 and participants can enter here. Here are the details:

 

The SAP HANA Platform: SAP HANA is SAP’s high-performance in-memory database and computing platform, a completely re-imagined platform for real-time business. It has already begun transforming business by streamlining transactions, analytics, planning, predictive, sentiment data processing on a single in-memory database so business can operate in real-time.

 

Who is Eligible to Participate: Small companies with at least one paying customer and/or existing product on the market. The focus needs to be on a product that solves one of the biggest problems companies have today: quickly assembling massive amounts of all kinds of data—structured and unstructured—into real-time insights that support informed decisions across the organization. Better information means companies can get closer to customers with the right products and services faster, and beat the competition.

 

What Participants Get: HANA test and development licenses, a development toolkit, and ongoing technical support from SAP worth over 550,000 RAND at no charge until the business runs live on SAP HANA, up to one year.

 

How Selection Works: SAP selects and invites start-ups to join a development accelerator (DA) where they build a Proof of Concept and ultimately, a solution with business value.

 

Once Development is Underway: Participants will receive ongoing architecture reviews, technical support, and consulting.

 

When Solutions are Complete: SAP will help get the word out about the best solutions through promotional materials.

 

The Fine Print – More Support: Participants in the program will also have access to SAP’s considerable market reach and other funding sources. For example, they’ll be able to meet with the folks at SAP Ventures to talk about funding opportunities out of the US $155 million start-up SAP Ventures Fund. They’ll also have the chance to attend and present at major SAP international events.

 

There’s a lot written about SAP HANA and this is one more reason for the developer community to get involved at the ground floor. Bring your best ideas for a better future for all.

 

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272408_l_srgb_s_gl-300x225.jpgA few months back I had coffee with an individual who I informally met at a leadership event. This individual was interested in joining my organization and had invited me for a meeting to learn more and share her experience. During our conversation she did not appear to be at all prepared.

 

Not only did she have a difficult time articulating her experience, passions and interests concisely, she spent more time discussing her weekend and recent break up. While it may seem obvious that this is not the way to present yourself in a networking situation you might be surprised to learn how often I have interactions where the individual seems very unprepared for a conversation and/or does not appear to be considering the impression they want to leave behind.

 

It has taken me a number of years to realize that every conversation we have is an opportunity – an opportunity to make a great first impression, an opportunity to learn something new, an opportunity to find that next manager, mentor, sponsor or friend.

 

Over the past 9 months I have had the chance to research and speak on the importance of having a strong personal brand – one that you’re conscious about developing as a means to support your professional and personal success. Through this work it has become evident to me how many other people are not thinking about the impressions they are leaving, nor utilizing the opportunities they have to connect with others to their full advantage. As a result of this I started to think about how your brand is enhanced or diluted in every interaction.  Because your network is based on the impression you make with others, using every opportunity to build your desired impression and expand your network is critical.

 

Here are 5 key tips to making the most of every interaction:

  1. Be genuine – no one wants to interact with someone pretending they are someone they are not and most people can smell a fake a mile away.
  2. Know who you are and what you stand for – in every conversation there is a chance to make an impression. Be clear who you are, what you value and be able to articulate what impact you can make and what you aspire to. This will differentiate you from others.
  3. Be intentional – what is the impression you want to make? As mentioned more times then I wish I walk away from conversations wondering if the other individual has any idea as to the impression they have just left with me. Think about how you want to show up to the other individual and plan for this in advance.
  4. Be considerate – considerate of the other person’s time, show up on time and conclude on time, be open to their ideas and their opinions.
  5. Be curious – treat every conversation as an opportunity to learn something new from someone else. By being interested and asking good questions you form a good impression with the other person and you will likely learn something new that will benefit you in the future.

 

Had the individual in my story above followed these tips I believe our conversation and the events following that conversation could have turned out quite differently.

 

So remember to use every conversation to enhance your brand and expand your network. Whether the conversation is just saying hello to someone you don’t know in the hallway or whether it is with your CEO, make that interaction count.  Networks are built on brands and reputation and if you have a strong brand and use the many opportunities that present themselves to you each day you will quickly see the opportunities that are out there waiting for you.

 

 

Follow Tracey on Twitter: @Tracey_Arnish

Cory Coley-Christakos

Innovation Rx

Posted by Cory Coley-Christakos Nov 28, 2012

rx-logo-500.jpgContemplate mortality … the mortality of your company that is.

 

Harvard’s Cynthia Montgomery challenged business leaders in Toronto last week to imagine that their organization was no longer in business. She dared the audience to reflect on who would miss it, and exactly what would be missed. According to Montgomery, that’s the real essence of the business and the focal point for strategy and innovation. This is a cool idea – what a great way to eliminate the noise.

 

 

Is your business headed for the sick bay?

 

Surely many corporations are sick or mortally wounded, whether they know it or not, in part due to the disruptive forces we're all familiar with:

 

  • Massive global demographic shifts - changing age dynamics, the rise of the middle class, and other demographic factors are reshaping the consumer profile while the “net” generation is impacting society in a multitude of ways (consider Tapscott’s “Grown Up Digital”)

 

  • Radical technological transformation - including these examples:
    • "Things” are de-materializing into software, including keys, passports, movies, books, currency (as are services such as education and health care)
    • Big data is becoming a factor in many industries, as technologies strive to conquer the sheer magnitude and also deliver value from the data
    • Processing power and speed makes formerly unsolvable problems seem trivial
    • Many billions of devices are connecting to the Internet (“the Internet of everything”)
    • Technology is enabling new business models and therefore new competitors

 

  • The blurring of industry lines - e.g. grocery stores are also banks.

 

I’m sure you could add another 20, if not 50, bullets to this list. These dynamics are changing the competitive landscape in every industry. According to research, even businesses operating at the top of their market are subject to a stall point

 

 

What’s the Rx?

 

So what’s to be done? A recent HBR article tells us “Management knows it and so does Wall Street: The year-to-year viability of a company depends on its ability to innovate.”  The article offers a handy “innovation ambition matrix” to help companies structure their initiatives more strategically.

 

In our client base, we see a lot of innovation around the customer experience, followed closely by employee engagement and radical improvements in speed.

 

As we evolve to the Experience Economy, people have come to expect more than just a product and are willing pay for an experience. This applies in a B2B as well as a B2C context.  We are using design thinking principles to co-innovate with our customers and marry technology with creativity to generate competitive advantage. 

 

Similarly, attracting the best talent is crucial for an organization, and keeping talented employees fully engaged and inspired is foundational.  Tools that enable mobility, personalized work experiences and collaboration across work groups are top priorities.

 

As for speed, immediacy has become the norm.  Businesses need to get new products and services to market much faster than ever before.  As the saying goes, managing a department using spreadsheets is like trying to cross the highway with information from 5 minutes ago.  We need both real-time AND predictive information to manage the inherent complexity of business today.

 

 

Don’t smother the innovation

 

New ventures are often stifled through well-intentioned efforts to prove ROI.  In a recent post, I summarized Roger Martin’s talk at the WCIT 2012 conference.  His opinion is that decision-makers have become too scientific, and he suggested that the key to success in the "century of innovation" is to combine the best of analytical thinking with the best of intuitive thinking.

 

 

An apple a day

 

If we view innovation as a journey, not an event, we realize it’s something that has to be practiced every day through large and small initiatives.  It takes a daily injection to keep a business healthy and vibrant.

businessgrowth.jpgPut yourself in control during these times of uncertainty. If you do, you’ll grow your business and begin to see more clarity than ever. But how?  Here are a few tips to consider:

 

Your customers should be the heart of everything 

Face it- they have more choices today than ever.  Make sure that they know you value them so they keep coming back to you.  You want them to know implicitly that you are willing to move mountains to make them happy.  Suggest to them how they can excel in ways they might never have considered and become a partner in success together.  If you do this, they will help you grow through their loyalty.  If you don’t, a new vendor/company is just a click away.  Don’t give them reason to shop somewhere else.

Modest Growth is respectable growth

If you stick by this mantra, it will help you deal with unexpected change.  Hiring now might mean paying a relative to help out short term; that’s growth too.  Given the economy is still in recovery mode, this is not the time to expand rapidly.  Rather, it is likely the time to recoup and regroup. This means building sales first, acquiring new customers in innovative ways and accumulating enough cash flow to weather possible tough future times.

Accept that you need to put in the time up front to see efforts pay off down the road 

A friend of mine who is a small business owner has spent countless hours making new forms, as well as entering customer and pertinent tax data in the past months.  Why? Not because he enjoys giving up weekends and evenings.  The reasoning is simple: long-term it will help save him time on a regular basis- like when tax time rolls around. It’s a painful process today, but the benefits will pay off handsomely down the road.

Know when to let go 

There are regulations everywhere and it’s not getting any easier to navigate them all, or the many new ones coming.   Small businesses are feeling the pressure more acutely as each one has a direct impact on their business model.  According to the NFIB Research Foundation Study, regulations force project cancellations, abandonment and significant adjustment to project plans.  How does a small business owner tackle them to stay compliant while still focusing on their company?  The best option might be to outsource this task, or bring in someone on a short term basis to tackle if for you.  After all, this is a moving target and maybe getting an expert in short term will give you one less thing to worry about.

Maneuver with skill

The steps being taken to spur growth of small businesses can most appropriately summed up in one word: confused.  On one hand, they may appear beneficial. However, when looking closer, are they?  The corporate tax rate is slated to drop to 28% from 35% to spur growth.  On the flip side, any small business over 50 employees is going to need to provide health insurance.  Will what’s saved in taxes go to health insurance costs?  Some companies might choose to stay at 49 employees just to save costs.  However, that’s not a good long term strategy.  A better one might be to hire your relative, bring on short term contractors or even move out of state.  Managing your business will require looking at it holistically – with the adeptness to change fast and be able to have the right buttons to turn on/off easily.  These buttons could be ones like hiring that 50th employee, outsourcing production, or even forgoing investment in new equipment.

Become a balancing expert

As a small business owner, you need to not only continue to run your business effectively, but also continue to master new things coming.   Many of the answers you find on your quest for certainly and clarity may be found in unlikely places- from peers who’ve made mistakes you can learn from, your own mishaps, or even from that part time expert you had to hire to help you navigate the new health care laws or business regulations. Whatever you do, don’t sit back and hope for clarity or an easy break. It’s not likely to come soon in this dynamic business climate. Put yourself in control instead.

 

About the author:  Jennifer Schulze is a small business owner in San Francisco, California.  She also helps companies manage their small business challenges at SAP, where she markets software that aids small and midsize companies in running better.

Capital markets firms are falling behind in Big Data as industries from utilities to manufacturing successfully employ enterprise-class solutions to improve operations. But capital markets firms aren’t keeping up either because they’re too new on the block or because compliance drains their coffers, according to TABB Group’s Paul Rowady.

 

Big Data Strategy 11-28-2012“Investing in new technologies and solutions is counter-intuitive during a downturn (and capital investment statistics of late support this claim),” Rowady said Monday. “Capital markets firms need to selectively strive against this urge.”

 

Getting High on ROI

 

But strategizing must precede striving, according to John Weathington of San Francisco-based consultancy Excellent Management Systems. Each firm’s top decision makers should spend the time and money to evaluate the return of a Big Data solution.

 

“Some organizations are obsessed with spending money on Big Data without any concern for the value it represents,” Weathington said in TechRepublic’s Big Data Analytics blog. “Return on investment lies at the intersection of Big Data’s rational contribution to strategic purpose (return) and capability (investment).”

 

ROI for capital markets firms include new trading strategies and transformed risk management. Pete Harris recently completed a survey about this, polling major financial markets firms in the U.S. for Andover, U.K.-based financial IT researcher A-Team Group.

 

Harris, A-Team Group’s president of Americas, will present his latest Big Data research at The Yale Club of New York City on Thursday. Click here to register for “Big Data in Trading and Risk Management” if you’ll be in midtown Manhattan tomorrow. Harris and SAP will discuss the benefits of:

 

  • Faster, in-memory analytics of large, complex portfolios
  • High volume, highly diverse Big Data sets for trade analytics
  • Aggregated analytics of exposures and positions

 

The good old days of analytics models that are as simple as a six-sided cube have melted away. Firms could end up trying to model something with an unwieldy 571 sides, according to SAP’s Keith Wood.

 

“So forget your Exadata, your Teradata, and all the materialized views out there -- they are only ever going to be good for the Donald Rumsfeld-style ‘known:known’ problems,” Wood told me after his “Real-Time Risk Aggregation Supported by a Panopticon-Powered SAP HANA/IQ/ESP Platform” webinar on Tuesday. “The only solution if you wanted to do this in real time is to have an engine that can do the simple correlation on any dimension (and only that dimension) on the fly.”

 

Show Me the Money

 

How organizations bankroll these changes vary between firms, according to an informal poll taken during an SAP webcast on Wednesday. About 40 percent of respondents attending “Infrastructure Management” indicated that FSI infrastructure spending is enterprise driven, while the usual suspect -- line of business -- only received 20 percent of the vote.

 

Respondents may have been talking about the regular IT budget. Regardless, the groups that Rowady and Weathington worry about will have to act fast -- and wisely.

 

Once both groups rise to their respective Big Data challenges -- springing from their duffs or focusing thier exuberance, as appropriate -- capital markets firms can start running as efficiently as other industries.

 

Related Articles:

 

Journey to Hypergraphica: Redesigning Capital Markets Solutions” by Paul Rowady

 

Getting the right ROI on Big Data” by John Weathington

 

Freedom in a Digital World” by Seth Godin

smalljb.pngiPhone App Makes Unique, Affordable Gift-giving Easy

 

Shoppers already dispirited by the crowds and commodities at the mall this holiday season can take heart—there’s a better way. JustBecause is a new Facebook iPhone app that turns gift-giving on its head, focusing on the product not the recipient or the occasion. With a slogan that says “Send friends gifts that cost $1 but are worth way more,” JustBecause cherry picks an array of small gifts from not your average companies that offer unique products and services.

 

This is how JustBecause founder Matthew Hartman recently described the purpose of the app in Mashable Business:

 

“I think the key difference here is that we start with the gift, not with the friend. Instead of saying ‘It’s so-and-so’s birthday, you should send them a gift,’ we flip it around and say ‘Here’s an awesome new product or service, who do you think would really like it?’ ”

 

JustBecause gifts range from $10 to $100 in worth but only cost the gift-giver $1. Users are limited to giving five gifts per month in part, because there’s a finite number of each one. Choices encompass gift certificates, subscriptions, memberships, and actual products. Here are five examples of the treasures to be had:

 

  • Inveterate party-goers who need the latest look from celebrity designers might like a $50 gift certificate towards a dress rental from Rent the Runway
  • High and low steppers would be delighted with a $15 credit for a pair of super original yet extremely comfortable shoes designed by hand-picked artists from BucketFeet.
  • Gym rats in need of a nudge would surely dig into the Casual Gym-Goers/Meathead gift basket, chock-full of goodies like Ammo Energy shots and Monster Pump formula.
  • Chicagoan women on the town, (JustBecause is based in Chicago), will appreciate a one-month membership to Cheeky Chicago, giving them exclusive offers, city-wide perks and VIP status to all manner of exciting Windy City events.
  • Clothes horses will be thrilled with the choices at Betabrand, an online-only clothing company based in San Francisco that designs, manufactures, and releases new “inventions” every week. Bestsellers include the disco hoodie and Sons of Britches casual slacks line. Your choice: a Betabrand Rocket T-Shirt or $20 credit.

 

Since its launch in September, JustBecause has focused solely on creating a great user experience and they’re succeeding. Giving couldn’t be easier. If something catches your fancy, just tap the screen and your Facebook friends are automatically listed. All you need to do is tap the name of the lucky recipient. The app sends a notice to them and your friend makes arrangements to receive the goods. Happy holidays!

Glue.jpgIt has been two weeks now since we heard the latest on SAP technology and current trends in IT at SAPPHIRE NOW from Madrid. While there is always a vast amount of great information to digest, there is typically also a key message that stays in your head after these events. So what was your major takeaway from Madrid?

 

For me, it was all about the opportunity that comes with change and how it can be managed through innovation. In their opening keynote, SAP Co-CEOs Bill McDermott and Jim Hagemann Snabe stressed the fact that the power is shifting from enterprises to consumers. And they gave a number of examples on how technology can help companies react to that change. For instance by creating a totally new customer experience.

 

Hearing about the opportunities of innovation is one thing though. I think the best indicator for the actual impact that technology is having on an industry are the stories that we hear from companies that have embarked on their journey with SAP. I therefore really enjoyed listening to the many customer examples that Bill shared in Madrid, as they clearly underlined the overall message (check out this blog post from Timo Elliott to learn more about those customers).

 

AsTim Clark rightfully said in an earlier blog post about the The Evolution Of SAP Business Trends, the glue that is holding it all together are the potential business benefits of SAP’s products, strategies and solutions. So I thought I would start contributing some "glue" to this community by sharing a number of stories that also resonate well with Bill´s and Jim´s message from Madrid.

 

Looking at the the names below - what do a US university, a US food company, a Bank in South Africa, a Retailer in Russia and a Biscuit producer in Sri Lanka have in common? They all made bold decisions to stay ahead of change. By transforming their business they have achieved quantifiable benefits that will enable future growth and ultimately help them create a new experience for their customers:

 

University of Kentucky: Continuing a Tradition of Success with a Real-time Data Platform 

From championship basketball to nationally ranked programs in public affairs and healthcare, the University of Kentucky has a strong winning tradition. Faculty and staff work together to ensure a successful experience for every student. Today, the university uses advanced analytics based on the SAP HANA platform to help it retain and graduate a student body of 28,000. “A query that once took 20 minutes now executes in only seconds with SAP HANA". Read the full story

 

Listen to Vincent Kellen, CIO at University of Kentucky, discussing their project at SAPPHIRE NOW.

 

ConAgra Foods enters the world of in-memory computing and accelerates transfer of material ledger data by 92.9 %

ConAgra Foods, maker of leading brands such as Hunt’s tomatoes, Healthy Choice meals, and Orville Redenbacher’s popcorn, puts heavy demands on its finance team. In order to streamline processes involving vast amounts of data, it entered the world of in-memory computing, opting to start small using rapid-deployment solutions from SAP with the SAP HANA® platform. Read the full story

 

2012 SAP EMEA Quality Award Winner Standard Bank Opens 7,000 New Accounts per day by using Mobile Technology

How can a responsible financial institution help combat poverty in South Africa, while improving its bottom line? Standard Bank Group Ltd. built innovative mobile apps to bring financial management technologies to potentially 10 million new people. With that, the bank dramatically expanded its customer base and reduced origination costs. Read the full story

 

Watch their video on YouTube:

 

MEVI-RUS: Building Transparency and Flexibility to Support Business Growth

A growing business requires a flexible solution to meet the challenge of expanding business operations. The SAP ERP application satisfies this requirement for MEVI-RUS CJSC, helping this producer of leather goods to make purchasing and sales processes more transparent, significantly reduce nonproductive losses, decrease service time, and increase its number of customers.  Read the full story

 

Ceylon Biscuits Limited: Expanding to Make the World a Sweeter Place

What started as a humanitarian program to make high-protein biscuits for Sri Lanka´s school children has become one of the country´s fastest growing producers of tasty treats. But Ceylon Biscuits Limited needed a unified IT system that could keep up with growth. With the SAP ERP application, the company can now boost a 100% order fulfillment rate, which means more biscuits for everyone!  Read the full story

In the history of iconic office buildings, New York City’s Empire State Building stands tall. Constructed in 1930, the 1,454-foot behemoth continues to defy gravity and tourist expectations – thanks in part to ongoing preservation and restoration investments to keep it running like never before. The latest facelift (unveiled last night with help from Grammy-award winning singer Alicia Keys) comes in the form of a cutting-edge LED lighting system, provided by Philips Color Kinetics (PCK).

 

Here’s more from the press announcement:

 

The state-of-the-art dynamic lighting system from PCK is unique to Empire State Building and allows customized light capabilities from a palette of over 16 million colors in limitless combinations along with effects previously not possible such as ripples, cross-fades, sparkles, chasers, sweeps, strobes and bursts. In addition to greater control and management of the lighting, the new computerized system will deliver superior light and vibrancy levels in real-time, unlike the previous floodlights.

 

And here’s what Anthony E. Malkin, whose company supervises the Empire State Building had to say:

 

The Empire State Building’s lights are the international icon of the New York City skyline. We use our tower lights to partner with select charities, organizations, and events around the world. Philips Color Kinetics’ new LED lights were installed over the summer and have been set at the color and intensity of the incandescent lights they replaced. As of tonight, our lights’ full range and intensity will be brought to life, forever changing the New York skyline.

 

Change isn’t the only familiar face in the “city that never sleeps” and the “concrete jungle where dreams are made of.” It’s also a regular occurrence at Philips as they must continuously innovate and bring new products to market faster and more efficiently than competitors. Learn how Philips uses SAP’s Product Lifecycle Management to run better in this video interview with Michael Stevens, a business process manager for innovation at Philips Lighting Electronics.

 


 

CEO1.pngCanadian businesses are very busy with innovation. There’s no doubt about it. SAP Canada’s Managing Director, Mark Aboud has been a champion of the innovation story in Canada for two-plus years. Through his talks and customer meetings, SAP Canada has initiated impressive innovation projects – many of which will transform traditional industry paradigms.

 

It make me proud (and reassured) to see that, in many of these innovation initiatives, marketing executives are standing shoulder-to-shoulder with the C-suite, owning a significant role in redefining how organizations approach innovation. This is happening for a very good reason – today’s innovation agenda is tightly intertwined with the notion of improving the customer experience and providing new levels of value to today’s significantly more empowered consumers.

 

I recently had the unique opportunity to speak at a Canadian marketing conference called ‘Digital Day’ and I used this platform to discuss the tremendous opportunity that exists (for marketing execs) today. Are you ready?,” I asked. “Are you ready to embrace the elephant?”

 

I centred my talk around two ‘Wordles’ (I’ve pasted them in this blog). One summarizes the many business factors creating ‘Chaos’ that a CEO faces today and the other represents the ‘Chaos’ that the CMO is managing. While some of the terms are uniquely Canadian (like ‘Productivity Crisis’, for example) I think this should resonate with anyone reading this post.

 

My message in creating these Wordles is quite simple: the words may be different, but the challenges are the same. In fact, the commonality crystallizes the reasoning as to why the CMO and CEO are working so closely together today – there’s no greater ally for a CEO than a CMO that can drive strategies to tackle the data explosion, social media, channel proliferation and tectonic shifts in consumer demographics.

 

CMO2.pngSharing this conclusion was my ‘moment of truth’ with the ‘Digital Day’ audience. On the one hand, these challenges amount to a beautiful recipe for SAP’s Big Data story. On the other, using  the terms ‘data explosion, social media, channel proliferation and tectonic shifts in consumer demographics’ in one sentence will make even the most seasoned executive’s head spin!

 

So, it was gut check time, time to see where Canada’s marketing community is at with this issue. Are they ready to embrace the elephant?

 

The answer was/is clearly yes.

 

In fact, most people don’t know that Canada leads the North American market in areas like Customer loyalty.

 

SAP Canada’s recent innovation work with Société de transport de Montréal (STM) summarizes just how focused Canadian organizations are on innovation – and just how involved Canadian CMOs are in driving the customer experience agenda.

 

Want to know more about the STM story? Read this article in Canada’s Marketing Magazine http://www.marketingmag.ca/microsite/making-sense-of-big-data/.

 

What's more, you can watch STM's Chairman of the Transit Users Representative tell the world about STM’s innovation initiative with SAP.

 

 

There is so much happening in Canada’s marketing LOB regarding customer experience. STM is the tip of the iceberg. To better understand this movement in Canada, we are just concluding a research study focused on Canadian marketing leaders and their plans for innovation in 2013 and beyond – so expect to see another post from me on this topic once it’s complete (not sure if that’s a promise or a threat…!).

 

In the meantime, it’s clear that the flame of innovation is burning bright in Canada. So next time you fly up to the truth north strong and free, don’t be surprised if the executive you're scheduled to meet with is happily hugging the elephant!

Recife1.jpgWhat do the city of Hamburg in the north of Germany and the city of Recife, on the northeast coast  of Brazil have in common?

 

They’re both big logistical hubs shipping millions of tons of cargo every year with thousands of trucks picking up and delivering goods every day. A logistical nightmare? Far from it. These are smart cities that are pioneering state of the art technology to manage current challenges and more importantly, to plan and build better cities for the future. These cities are thriving examples of the machine-to-machine (M2M) communication that’s at the core of the Internet of Things (IOT).

 

Recently SAP helped sponsor the Smart City Business Event in Recife.  Top governmental officials, entrepreneurs, urban planners, architects, investors and influencers got together to plan how to meet the future needs of the population including basics like food, water, energy and education. While various stakeholders may have different visions and priorities, they all agree that technology will be their greatest ally when it comes to improvements in security, mobility, energy consumption, construction, consumer demand, sustainable use of resources, healthcare and education. Only the best technology will help cities manage the millions of devices, the billions of applications and documents, and the trillions of things that together make up the Internet of Things.

 

Managing smart cities, smart logistics, and smart supply chains all require three things: mobility, cloud and big data.  By implementing SAP solutions and the SAP Mobile platform, another big Brazilian city is gearing up to host the next Olympic Games and World Soccer Championship the smart way. People in Rio de Janeiro can already access a Citizen Connect portal where they can upload alerts about traffic or road damage, provide feedback or access information about the weather, traffic or other topics of daily interest.  “A true revolution in urban management is underway, driven by advancing technology. It’s citizenship at your fingertips,” says Heloisa Tricate, Manager of Public Affairs at SAP, who presented SAP’s innovative solutions for smart city management at the Recife event.

 

On the other side of the globe, another city is also dealing with urban growth the smart way. Traffic in and around the port of Hamburg has been growing at an alarming rate, but road capacity is restricted and the options for modifying the roads are limited. Europe’s second-largest container port urgently required an efficient traffic management system to continue growing.

 

The Hamburg Port Authority (HPA), Deutsche Telekom and SAP jointly created a logistics IT solution designed to connect port-based companies, partners and customers more closely. The “Smart Port Logistics” pilot project has resulted in a comprehensive IT platform that incorporates mobile apps and makes it possible for traffic information and port-related services to be accessed from mobile devices such as tablets and smartphones. Using state-of-the-art IT processes at the port of Hamburg at a very early stage will help the city and port authorities manage logistics efficiently saving time and money for everyone.

 

So the IOT is everywhere where people are using mobile and cloud technology to manage their data volumes and connect the different devices, machines, and appliances needed to run their business better than ever!

 

To learn more about the IOT, read Sanjay’s blogs or view the video:


Jonathan Becher

To Sleep or To Rest?

Posted by Jonathan Becher Nov 22, 2012

As a frequent traveler, I sometimes find myself so time-shifted that I can’t sleep even though it’s late at night. During a recent episode, I wondered whether lying in bed with my eyes closed has the same benefits as actual sleep. Doesn’t my brain and body still get some rest?

 

Not surprisingly, the answer isn’t clear cut.

 

Brian Fung (@B_Fung), an associate editor at The Atlantic, asks exactly this question in “When you can’t sleep, how good is lying in bed with your eyes closed?”  He concludes that actual sleep is significantly superior to simply resting. According to Dr. Chiara Cirelli, a neuroscientist at the University of Wisconsin, there’s a unique benefit to sleep you don’t get with “quiet wakefulness, microsleep, or unihemispheric sleep.” Lying down might help the body relax but it doesn’t support the cognitive recovery needed by the brain.

 

A Daily Mail article titled “Why a rest is as good for you as a sleep” seemingly takes the opposite point of view. According to sleep specialist Dr. Matthew Edlund, rest is as important as sleep to our long-term health. Dr. Edlund feels rest is usually neglected and prescribes four kinds of rest: social, mental, physical and spiritual.

“Many of us are so busy we see rest as a weakness – a waste of precious time, but rest is, in fact, a biological need. All the science shows we need rest to live, just like we need food.”

 

I interpret this to mean that we need both sleep and rest.

 

So what can you do to get to sleep? The research is fairly consistent on this one. Take your mind off of the fact that you can’t sleep – worrying about it will only make it worse. Don’t watch TV – blue-colored lights trick your brain into thinking it’s daytime so that it doesn’t release melatonin. Instead, get out of bed and do an activity which uses low light and doesn’t require a lot of activity – reading is a good choice.

 

I recommend reading this blog. If it doesn’t put you to sleep, nothing will.

 

Follow me on twitter @jbecher.

 

This blog was originally posted on Manage By Walking Around.

butter.pngButterball sells nearly a billion pounds of turkey each year and is a bestselling turkey brand during the Thanksgiving holiday. Why? Is it because of the decadent Butterball name that conjures images of plump, juicy turkeys? Is it because the company understands its customers? Or is it because the company simply runs better than its competitors?

 

Like an overstuffed Thanksgiving plate that includes all of the trimmings, turns out it’s a little bit of everything.

 

First, there is no secret behind the company name. It means what it says. From the Butterball web site:

 

The Butterball turkey was introduced in 1954, the product named for its broad breast and plump, round shape.

 

Butterball understands its customers too, steadily building brand loyalty over the years during the holidays with its “Butterball Talkline.” According to CBS News, 50 trained experts have helped one million customers over the past few weeks on e-mail, Facebook, Twitter, and over the phone. They get about 12,000 phone calls on Thanksgiving Day alone from customers in a jam that need quick advice and emergency cooking tips.

 

And from a business and IT perspective, Butterball knows how to reduce operational costs, enable rapid acquisitions and create products (they sell much more than turkey) that delight consumers. SAP software plays a juicy role.

 

“We have definitely realized benefits and better visibility to our data,” said Ron Wells, CIO, Butterball LLC regarding his company’s use of SAP. “We feel like we have that good, strong foundation.”

 

To those observing, Happy Thanksgiving!

Shadow-Banking-and-Dark-Pools-11-21-2012.jpgShadow banking may sound like the demon brainchild of Dr. Evil and Gordon Gekko, but about half of the banking system’s assets are in this mostly unregulated realm of finance. And global regulators at the Financial Stability Board recently looked at taming that realm.

 

Liquidity buffers, leverage limits and standards on how to make calculations were among the FSB’s suggestions, AFP reported Sunday. The largest shadow banking sectors are in the U.S. and the Eurozone, but systems in other geographies are about five times the size of GDP, as with Hong Kong and the Netherlands.

 

Policymakers around the world are trying to shine lights on shadier parts of the financial services industry. But authorities are finding transparency in surprising places -- and hope in some unlikely places.

 

On The Dark Side

 

The almost-as-nefariously-named dark pools are also on international regulators’ hit list, according to The Financial Times on Monday. These off-exchange venues keep prices hidden until after the trade -- and keep identities a secret.

 

Stock trading via dark pools in the U.S. is up almost 50 percent since 2009. Asset managers like them because they reduce risk and prevent electronic traders from carving up orders, but U.S., European and Australian officials worry that dark pools will undermine public markets.

 

“If the majority of order flow is filled away from pre-trade transparent markets, investors could withdraw quotes because of the reduced likelihood of those orders being filled,” Rhodri Preece, director of capital markets policy at London-based investment association CFA Institute, told FT. “It would be prudent for authorities to monitor these developments closely.”

 

Regulators seem to agree, but they have their work cut out for them, as transparent markets still aren’t completely sorted either. The U.S. Securities and Exchange Commission is looking into allegations that American stock exchanges offer unfair advantages to their more sophisticated traders, The Wall Street Journal reported Monday.

 

Trading Darkness for Daylight

 

On the other hand, diminished risk got foreign exchange swaps and forwards off the hook for tighter regulation last week. The contracts, which guard against fluctuating currency, are transparent and liquid enough not to need regulation under the Dodd-Frank Wall Street Reform and Consumer Protection Act, the U.S. Treasury Department said Friday.

 

Market participants, such as the big banks that lobbied for this decision, are understandably elated because they will dodge some of the most expensive Dodd-Frank rules -- but not all of them. They will still have to abide by conduct and reporting.

 

Oh yeah, and no more betting with taxpayer money.

 

Different Strokes for Different Volcks

 

One of the more notable components of Dodd-Frank is the Volcker Rule, which prohibits proprietary trading by banks with branches in the U.S. The rule would hold regardless of whether the banks are based there.

 

That would mean foreign banks with a U.S. footprint would suffer the same Volcker-induced headache that American banks have. Costs and other issues associated with Volcker Rule compliance could prompt foreign banks to flee the U.S., according to some American attorneys.

 

“I doubt that Volcker alone will lead to a mass exodus,” Alan Avery, a partner at Los Angeles-based law firm Latham & Watkins, told the International Financial Law Review. “But banks are beginning to conduct cost/benefit analyses to determine whether it’s worth maintaining a presence in the U.S.”

 

And the U.S. doesn’t need a mass exodus of banks as its budget is careening toward the fiscal cliff.

 

Beacon on a Cliff

 

Looking over the edge of that cliff may not get most people thinking optimistically. The fragile U.S. economy could crumble back into a recession if politicians do not reach accord on the federal budget, Ben Bernanke told the Economic Club of New York on Tuesday.

 

But détente could presage a prosperous 2013, the chairman of the Board of Governors of the Federal Reserve System also said.

 

“There’s important potential for the economy to strengthen significantly if there’s a greater level of security and confidence about where we’re going,” Bernanke said. “A plan for resolving the nation’s longer-term budgetary issues without harming the recovery could help make the New Year a very good one for the American economy.”

 

That might not solve the European debt crisis, rejuvenate the Chinese economy or even light up every dark pool, but it could be a beacon to the rest of the world.

 

Related Articles:

 

US ‘dark pool’ trades up 50%” by Philip Stafford

 

U.S. Treasury Exempts Foreign Exchange Swaps From Dodd-Frank” by Silla Brush

 

Bernanke: Fiscal Cliff Fix May Bring ‘Very Good’ Year” by Joshua Zumbrun

The big news for developers at SAP TechEd Las Vegas was the announcement of SAP HANA One. SCN moderator Juergen Schmerder explains the program: “You can now create your own HANA One developer environment on Amazon Web Services (AWS).”

 

At Amazon, AWS evangelist Jeff Barr describes the advantages of this SAP HANA deployment option, “You don't have to spend a lot of money. You don't need to buy and install high-end hardware in your data center and you don't need to license HANA. Instead, you can launch HANA from the AWS Marketplace and pay for the hardware and the software on an hourly, pay-as-you-go basis ... Because you can now launch HANA in the cloud, you don't need to spend time negotiating an enterprise agreement, and you don't have to buy a big server"

 

Of course, there are other ways to deploy SAP HANA including options to deploy on-premise or in a private cloud. Michael Bechauf explains flexibility of different SAP HANA deployment models. “The times of big monolithic pieces of software are definitely over at SAP,” he remarks.

 

While SAP Mentors work on ways to optimize the ABAP stack for HANA, the SAP HANA One Headquarters offers a $25 Amazon AWS credit to community members. “There is indeed a huge Absence of Nifty ABAPers around,” laments DJ Adams, “they're all in-memory now :-)”

 

Find out more. A recent book on SAP HANA is getting five-star reviews and is currently the #1 seller at SAP Press. Learn “what SAP HANA is, whether its the right fit for your business, and how to plan an installation." Analytics blogger Mico Yuk, enthuses,"HANA is about to change the world" and calls this book "A must read."

sapphire.pngBack in the office after a three-day stint at SapphireNow in Madrid last week, the SAP BRIM team was full of reports of another well-run SAP event that featured open and friendly contact with customers and partners.

 

The big news was the launch of SAP 360 Customer running on SAP HANA. This powerful solution will shape the future for all SAP business applications as they take advantage of SAP HANA for real-time business. As the event coupled TechEd and SapphireNow, this news resonated with both the techies and the business types from all industries. Participants recognized that the business challenges of customer centricity, changing business models and succeeding in a real-time world were not specific only to their own industry. As participants saw customer presentations and discussed with their counter-parts from other industries they were able to take in the full measure of the SAP range of business solutions and their ability to help companies meet these challenges across all industries.

 

One such presentation was the Alex Rootham’s discussion on how the SAP Convergent Charging solution helped Canadian telecommunications giant, Telus quickly provide data services that customers could trust and use immediately. Telus (12.7M subscribers) has had a recent internal drive to put their customers first. The business cases discussed directly relate customer satisfaction to increased revenues. This has led to lots of improvements in customer service but also internally at Telus: employee satisfaction went up 10%, the “biggest jump that our analysis firm has ever measured," reports Rootham. You can watch his presentation here.

 

The SAP BRIM demos and stands were the perfect place for exchanging ideas and proved to be a great place for customer-to-customer interaction as well. The SAP BRIM banking round table provided an industry specific forum where SBERBANK spoke about its particular interest for the social network part of the process upstream of CRM and billing.

 

Want to know more about what went on at SAPPHIRENOW and TechEd in Madrid? Go to the SAP BRIM LinkedIn group page to join in the discussion.

 

 

273966_l_srgb_s_gl.jpgOne of the more popular features in the Washington Post is its “5 Myths” opinions column, where commonly held misapprehensions about politics, society, and even science are weighed against evidence. Often, the evidence is obtained from top-tier academic journals, large-scale government studies, or national databases, and addresses topics characterized by vigorous, though misinformed debate.

 

HR is one of those fields where numerous myths endure. Part of the reason is HR tends to be more professional practice than rigorous academic discipline, so there is no foundation of basic science that informs both practitioners and researchers. Indeed many have lamented about the chasm between the two, and have called for a closer partnership. Nevertheless, several myths pervade human capital management (HCM). We’ll explore five of them.

 

  1. All training is beneficial

 

A multibillion dollar business in its own right, training is universally recognized as a necessary component for remaining competitive. Ample, high quality training is no longer considered a perk, but rather a fundamental component of high performance work systems, and a key differentiator in developing an employer brand. It is so highly regarded by employees that it can be seen as a substitute for wage increases, particularly in the public sector.

 

But sometimes you can have too much of a good thing. Research has demonstrated there are optimal levels of spend and hours beyond which there is a decreasing rate of return on investment[i]. Furthermore, not all types of training content yields a positive return. For example, hours of sales training are just as likely to be associated with decreased sales revenue in the following year as increased sales revenue, or not associated at all.

 

Nor do all employees benefit equally. Effective onboarding training may help early career stage employees achieve quicker time to proficiency, thereby increasing business performance. But it may be of little effect to a mid-career manager, who would more likely achieve business benefits with executive development or interpersonal skills, and only after a few years of tenure.

 

For analytics, training represents a huge opportunity to increase both its effectiveness and efficiency. Return on training investment can be maximized by gaining precise understanding of which employees (or groups of employees) should be offered training, along with how much, when, what content, and at what stage of their tenure.

 

  1. GPA is a good predictor of high performance

 

If HR leaders in a lot of knowledge industry companies were to be frank, they would admit they have no idea if candidates for hire have the potential to become high performers. This is no big surprise, particularly since little of what would indicate superior talent is observable either during interviews or in most job situations. So we assume that past success predicts future success, and one of the most ready metrics is GPA.

 

And why not? Many of the skills needed to achieve a high GPA are also those needed to succeed at work: diligence, intellectual insight, ability to learn abstract concepts and apply them to real situations, and the discipline to complete tasks.

 

The fact is GPA may occasionally predict short-term performance for some roles requiring little or no prior experience. What little validity GPA might have applies to persons straight out of school, in roles requiring mastery of classroom training content before becoming fully proficient. In other words, success in school situations predicts success in future school situations, not on the job.

 

Analytics can help us discover invalid predictors so that we can eliminate them from employee selection procedures. Conversely, analytics can help us locate accurate predictors of workforce performance from across larger data sets, and develop competency models and job descriptions that better capture true requirements. Better information leads to better matches, in contrast to the fishing expeditions that characterize most companies’ employee selection.

 

  1. Financial incentives are the best way to drive performance

 

One of the worst ideas to come out of academia in the last 50 years is the so-called principal-agent problem. It states that executives cannot be trusted to act in anyone’s interest but their own, and need to be threatened or bribed by shareholders in order to behave. Over the past few decades, this cynical notion has infected the entire job hierarchy. As a result, managers and HR professionals often believe the most effective way to get employees and reports to perform is to offer fast money. This is at best a half-truth.

 

Money does indeed motivate, but not always in the way we want. Because most organizations have only a partial understanding of what behaviors drive performance, they cannot always be sure what they are paying for. Dysfunctional incentive systems will get dysfunctional and sometimes prosecutable results, whether by employees gaming the system or by perverse controls that unwittingly incentivize the wrong behaviors.

 

In most cases, financial incentives intended to drive performance are effective only in roles where the performance criteria are completely unambiguous and easily measurable, individual performance does not depend on the contributions of coworkers, and necessary job tasks have a clear beginning and end. Those ever popular short-term performance incentives such as spot bonuses tend to be just that, short-term, and do little to increase engagement or long-term performance.

 

Compensation and performance management represent major opportunities for analytics, by crafting highly specific programs that provide just the right kind and amount of incentives, monetary and non-monetary, short-term and long term, private and public. Analytics can also provide guidelines for developing control systems that reward legal, ethical, and prudent risk taking among managers.

 

  1. Consulting experience predicts manager talent

 

Few myths are dearer to “War for Talent” combatants than the idea that experience as a strategy consultant, particularly at a Big Three firm, is a signal of exceptional senior management talent. Even Google, whose founders used to proclaim sophomorically on their job board that, “We are not a conventional company. Nor do we intend to become one.”, demands significant consulting or investment banking experience in most roles involving strategy. Like a lot of organizations, Google thinks it can differentiate itself by hiring people from the same talent pool who have been trained and reinforced by practice to think alike.

 

So why do we see a lot of successful managers who are former management consultants? The answer is selection bias. It is the same reason a lot of successful naval officers are Naval Academy graduates. It also distorts the view of what experiences actually predict success in senior management.

 

The fact is there is very little scientific evidence to support consulting experience as being a sure bet for adding to senior management bench strength. Consulting talent may in fact be the opposite of what is needed to be a senior manager, as consultants tend to be more entrepreneurial and autonomous workers, less inclined to socialize into the organization. Frequently, they have little patience in dealing with numerous administrative tasks, particularly those detailed and recurrent ones necessary for successful implementation of would-be brilliant consulting advice. Former consultants often falter in people management skills, and accepting constructive feedback.

 

Analytics can help organizations determine precisely what work experiences, prior knowledge, and activities truly indicate superior management talent, instead of relying on a process whose only justification is that companies with a reputation for being smart are also doing it.

 

  1. HCM is the same thing as HRM

 

HCM and human resource management (HRM) concern two different parts of the business: the former, processes and communication; the latter, assets and investments.

 

HRM oversees a critical administrative function that has evolved from a time when the personnel department was the steward of the labor/management relationship. Its duties are centered on extensive recordkeeping, compliance verification, and payroll management.

 

HRM involves significant hands-on care of a delicate balance of power, keeping channels of communication working between the layers of the organization. HRM’s development from the 1940’s to the present has been driven almost entirely by changes in government regulations and policies, and therefore tends to react to changes rather than being a change agent. HRM is highly labor intensive, and automation can drive HRM effectiveness only partially.

 

Human capital is an economic force that drives the accumulation of national wealth. Human capital can appreciate and depreciate, and is both a private and public good. Yet human capital does not have property rights, and therefore remains absent from most financial statements unless a transaction takes place under narrowly defined conditions.

 

How human capital becomes transformed into business value is still a black box, as human capital asset dynamics are only partially understood. HCM analytics seeks to turn the black box of human capital investment into a glass box, using both deep subject matter expertise, and skillful manipulation of data. Yet learning one thing often requires unlearning another. Extinguishing other HR myths may be a necessary first step in bringing transparency to the black box.

 



[i]See for example, Sugrue, B., & Rivera, R. J. (2005). State of the industry: ASTD’s annual review of trends in workplace learning and performance. Alexandria, VA: American Society for Training & Development.

photo_4.jpgAs we approach the US Thanksgiving Day and the winter holiday season, it is a natural time to reflect. This has been intensified this year by my recent experience in Spain. Having spent the better part of last week in Madrid for our customer conference, I was surrounded by the warmth and hospitality of my European colleagues, partners and customers, and the Spanish people. This was set against the harsh backdrop of protests - some of them violent - and the rash of suicides caused by Spain's rigid foreclosure policies.

 

Double digit unemployment is becoming more the norm across Europe and we are experiencing a mounting debt crisis here in the US. The world needs to create over 500 million new jobs by 2020 to manage the growing unemployed, under-employed, and the new workforce of young people entering the market.  The tension caused by an inability of this half billion who cannot find work to support themselves and their families is spilling over into violence and has an indelible impact on the "conscience of the world."

 

I think we would all agree that unemployment is just one part of the miasma of high-impact global issues - ranging from epidemics, clean water, food shortages, global warming, over population, human slavery and *** trafficking, and any number of other attention worthy issues.

It is, then, a fantastic time to consider what corporations are doing to solve these issues and take a leadership role in their resolution. Corporate Social Responsibility (CSR) has now moved into the forefront of many significant global organizations as a way for the collective force and resources of a large scale company to make significant inroads to tackle these problems.  What used to be a "public relations whitewash" for many companies is now a strategic initiative.  What used to be a scatter shot approach across a multitude of worthwhile charities and causes is now a laser focused program to create considerable value.

 

Brittany Lothe, Global Head of CSR for SAP thinks of it this way: "We started seeing a trend over the past 4-5 years that companies were become more strategic with their direction.  It was less about "doing well by doing good' and more on focusing on where the business is strong and helping to create real value for society."  This becomes the practice of "shared value."  Instead of practicing corporate giving in isolation, organizations focus on where they can naturally make an impact.  GE was a notable first organization to think of shared value.  They rebranded with "Ecomagination" and showed that they could not only push for environmental change, but they can drive society and - through that innovation - they can drive profits.

 

SAP's Emerging Entrepreneurs Initiative

 

SAP has realized that it needs to work collaboratively to find solutions to help the underserved youth and unemployed to compete in this new global economy. Focusing on education ensures that youth have the skills required to succeed in today’s knowledge-based economy while working with emerging entrepreneurs helps to drive new ideas and business opportunities.

 

Lothe continues, "For our signature global initiative - the Emerging Entrepreneurs Initiative - SAP will provide support to entrepreneurs and will work to strengthen entrepreneurial infrastructure in key emerging markets through access to our technology, talent and targeted grants. These future leaders are driving businesses that have proven proof of concepts, they have the ability to scale and utilize technology to grow, and their purpose is both responsible and sustainable. We see enormous opportunity to utilize our technology, our employees’ skills and our other core competencies to create business impact, leverage core expertise and ultimately generate lasting impact on society to improve people’s lives throughout the world.”

 

We face a litany of serious issues around the globe. No longer can well-resourced organizations turn a blind eye to their role in addressing these issues.

 

##

 

Have a similar story to tell for your organization?  Connect with me on Twitter @toddmwilms or LinkedIn at any time. I will be covering this topic in 2013 and would love to hear and possibly tell your story.

investing-definition.jpgValue is a much misused term which is easy to define (one definition would be benefits in comparison to costs) but difficult to measure and quantify. Value investing, as a concept, has been around for a long time in the investment management profession with its most famous proponents being Benjamin Graham and Warren Buffet. The principles and techniques used by value investors are equally applicable in most business decisions where investments in capital and other resources are involved.
Investopedia defines Value Investing as follows:
“The strategy of selecting stocks that trade for less than their intrinsic values. Value investors actively seek stocks of companies that they believe the market has undervalued. They believe the market overreacts … resulting in stock price movements that do not correspond with the company's long-term fundamentals..”
According to Professor Greenwald of Columbia University**, value investing is three things – a good search strategy, a good valuation strategy and discipline and patience. This fits in well with what a good business decision should be based on – a good planning, solid evaluation criteria and discipline to carry it through. Hence, any business planning exercise should diligently apply the concepts and techniques of value investing to derive the best possible value.
The following are some key learning from concepts and techniques used in value investing which can immediately applied to your business:

1: Invest based on Best Return on Investment (ROI)

Intrinsic Value concept in value investing undertakes a fundamental analysis of the company – a similar approach has to be the basis of your key investment decisions. It is extremely important to have a good methodology or strategy for how the investment returns are calculated or as Professor Greenwald calls it “a valuation strategy.' A solid Business case should be driven by conservative and realistic estimation of benefits and the management team should be very clear on the benefits, their basis and the timelines.
Caveat – Be sure to check the basis of the benefits projected in the business case and how achievable they are.

2: Make a Fact & Analysis Based Decisions

Benjamin Graham said “the stock investor is neither right nor wrong because others agreed or disagreed with him; he is right because his facts and analysis are right.” Make facts and analysis the central tenet of your business decisions and you can drive out uncertainties surrounding your choices. It is important to note that within the investment professional, any decisions which do not have a basis of fact based thorough analysis is considered a speculation rather than an investment
Caveat: Do be careful of Analysis Paralysis - spending too much time on analysis to make a perfect decision and losing the chance to capitalize on an opportunity.

3: Monitor and Update Business Case Regularly

One of the cardinal sins of value investing is not to be on top of your investments and the changes in the market conditions or internal company activities impacting its value. In the case of business decisions made, it is imperative to re-evaluate the investment on a regular basis by updating the progress made and results achieved. A change of course may be necessary if the business case doesn’t add or the ground realities and assumptions used have changed.
Caveat – The frequency of the updates/review should not to be far too many as to prevent actual progress being made on the business decision.

4: Plan an Exit Strategy

Closely related to previous point and one of the key tenets of Value Investing is not to be too attached to your investment selections and knowing when to exit. This approach is equally relevant to any business decisions as well – it is important to regularly re-evaluate the business case and the benefits and know when to exit. While formulating a business case, considerable thought needs to be given to what are the possible triggers to exiting an investment decision – this can include ROI not being relevant because of cost or time overruns or a change in company strategy.
Caveat: Be careful about when just a course correction is needed as opposed to exiting from the choice made

5: Take a Long Term View of All Investments

Value Investment is not about benefiting from short term market fluctuations but about gaining from the inherent value in a business and thereby the underlying stocks. In a similar sense, where possible, business decisions should be driven by the long-term business vision and strategy. Alignment with the overall goals of the company should be the bedrock of any investment decision made.
Caveat: The definition of long term changes based on business lifecycle and the industry

Using IT To Deliver A Value Culture

Although business systems doesn’t explicitly figure in value investing, most fundamental analysis in the investment community give a lot of importance to the management team and stability of the company being analysed. Fact based analysis needed can be best achieved by a flexible analytical tools delivered by a Business intelligence platform enabling users to analyse and understand the information available. The full benefits are achievable if this is built on top of stable ERP and related business systems driving the operations. Also, any business decision which has implications of both capital and people investments should ensure the programme/project has the right team of people in place to ensure success. The key factors to look for in people for your key business plans is experience and the attitude to persist with the plan and see it through.

The concepts and techniques used by the practitioners of Value Investing can be effectively used to make better business decisions. Although value investing cannot be the silver bullet to the tough decisions an organization has to make, it does add an element of scientific methodology and common sense approach to decision making. Further, the techniques can help organizations be a better judge of the business value of internal and externally driven organizational initiatives.

Trading stood still on more than 200 companies Monday, as a server kept the New York Stock Exchange from publishing quotes for most of the day. Taken alone, this seems like a technical glitch.

 

Regulatory Reorm 11-16-12But combined with earlier problems, such as Knight Capital in August, Facebook in May, BATS in March and other issues this year, the glitch begins to look like a SNAFU. And U.S. regulators taking note.

 

Second Winded

 

The reelection of U.S. President Barack Obama and his enthusiastic crop of second-term appointees certainly injects new blood into the stream of veteran officials who are battered from four years of partisan roadblocks, not to mention disheartened by having to fix messes from 2008 and before. And rule making moves slowly, as mentioned Monday.

 

Though the pace of regulation writing for the Dodd-Frank Wall Street Reform and Consumer Protection Act will likely pick up in the post-election season, political and organizational flaws at the heart of the financial system will make true reform difficult, if not impossible, according to ProPublica’s Jesse Eisinger. Problems include:

 

  • The Security and Exchange Commission’s inability to fix a loophole that allows money market funds to disguise risk
  • The U.S. Senate’s failure to consolidate enforcement oversight
  • Meager resources allocated to certain agencies.

 

“These agencies are still run by commissions, not single heads, and they rely on Congress for their financing,” Eisinger wrote in The New York Times Dealbook on Wednesday. “It’s little surprise that such a structure creates plodding impotence.”

 

Better Off Fed

 

Yet these regulatory institutions and Congress are crucial to a smoothly running economy. Everything about the financial crisis tells us that exchanges and financial firms cannot regulate themselves.

 

And central banks cannot fix the economy on their own, as Mohamed El-Erian pointed out in The Financial Times on Thursday. Aside from setting interest rates, quantitative easing, meddling in U.S. Treasuries and more, the Board of Governors of the Federal Reserve System has had to pick up the slack for the previously mentioned ineffectual politicians and authorities.

 

“The Fed feel that they have no choice but to do more using imperfect, untested, partial and, potentially, risky tools,” El-Erian said. “At best, Fed officials have provided more time for the system to heal, but at the risk of growing collateral damage and unintended adverse consequences.”

 

Watch Your Head, Chicken Little

 

For perspective, NYSE was able to explain its Monday trading halt: It was the byproduct of consolidating its U.S. and European markets onto a universal platform. It wasn’t the end of the world because other exchanges were available for trading during the downtime.

 

So the electronic trading sky isn’t falling. Many of these incidents are likely the symptomatic of an industry in flux -- thanks in no small part to a huge data influx.

 

But there are cracks in the sky elsewhere. Policymakers’ absence may dictate that the Fed continue employing its experimental strategies as early as the New Year, El-Erian noted.

 

“Expect the Fed to move to quantitative thresholds, announce additional outright purchases of securities, and reintroduce Treasuries to their list of targeted instruments,” El-Erian said. “But unless (and until) politicians and other policy making entities step up to their responsibilities, this unusual policy activism will fail to deliver the economic outcomes that the country needs and deserves.”

 

Related Articles:

 

New NYSE glitch puts pressure on SEC to act” by Bruce Love

 

For Obama, No Easy Fix for Convoluted Regulatory System” by Jesse Eisinger

 

Expect more from the Fed -- and soon” by Mohamed El-Erian

smallPowerofSmallphoto.jpgAmong this week’s most significant news at SAPPHIRE NOW + SAP TechEd  Madrid, was the announcement of the winners of “The Power of Small: Entrepreneurs Strengthening Local Economies” global competition. Jointly sponsored by SAP and NGO, Ashoka, the competition attracted 370 entries from 69 countries. Here’s my take on lessons learned from these incredibly creative, committed people:

 

  • Small business needs IT just as much as big business. For the price of a meal at McDonald’s, micro entrepreneurs in Brazil, (think street market salesmen, curtain fitters, car washers, confectioners, and day laborers) can subscribe to MySoft, and get apps to run their business better. In just three years, this development collaborative has trained approximately 10,000 youths to create cloud-based smartphone and laptop apps. There’s market potential to reach 27 million small service providers.
  • Giving back makes economic sense. Adel is the brainchild of youth from Brazilian rural communities who received a university education. They launched Adel to help communities from Brazilian semiarid, the poorest region of Northeast Brazil, develop sustainable business models. Eighty-eight young entrepreneurs have launched 35 small rural businesses with Adel’s support.  Over 200 youths have been trained to develop and manage businesses. There hasn’t been a single default on the $52,000 USD invested in loans to these young innovators. Fully 100% of participants have remained in their rural communities and plan to stay.
  • Collaboration can help break the poverty cycle. Wennovation Hub in Lagos, West Africa can get entrepreneurs from ideas to funding in just six months. In Nigeria alone, between 35% to 50% of youths are unemployed.  To help break the cycle of unemployment, poverty, and crime, Wennovation trains youths to become innovators. In exchange for a flat 10% equity fee, they form teams that quickly identify, prototype and launch solutions. Partnerships with universities such as the Massachusetts Institute of Technology (MIT), Google Africa, and the Tony Elumelu Foundation have helped Wennovation incubate half a dozen tech start-ups, and raise over half-a-million dollars for them from local and international investors.
  • Access to technology makes a big difference to the smallest businesses. In South Africa self-employed, low-income individuals struggle to earn a living minus education, skills, and access to technology. The Microfranchise Accelerator (MFA) connects screened franchisors with potential franchisees to help these “necessity entrepreneurs” build commercially viable micro franchise business solutions. MFA’s two-year training and mentoring program aims to support 600 franchisees over the next few years.

 

There’s a lot of talk about small and mid-size businesses as the growth engine of world economies—I’ve written about this before. But the actions of these organizations prove that just about anything is possible.

globe.pngHow global do you want your small business empire to be? Unless your product is insanely complex or its name is an unmentionable slur in the local language, the limits are pretty much all in your head.

 

This is not your father’s—or even your older brother’s—globalization. Logistical networks have improved in lockstep with the penetration of the internet and mobile phones throughout the world.

 

However, while the processes for managing the supply chain have improved dramatically, the most important factors in global expansion—local experience and knowledge—remain frustratingly analog. Management teams must not only know the markets they wish to enter, they also need to understand the specific strengths and weaknesses they bring to each of those markets.

 

“You need to look at what you bring to the table, what key capabilities you have—such as customer relationships or specific technical or industry expertise—and how you leverage that into a much bigger part of the world,” says Karl Stark, managing director of Avondale Strategic Partners, a firm that advises high-growth business clients.

 

And despite all the improvements, logistics processes have never been easy to manage. That old bromide, out of sight out of mind, applies. “As you start adding other locations, it gets increasingly difficult. Suddenly you can't see it in front of you anymore,” says Mark Lehew, SAP's national VP of strategic growth enterprises. “So it's harder to keep control over everything. It becomes a real challenge to rapidly sense and respond to changes across the various remote locations. The challenge grows with each different time zone or language you need to support.”

 

Here are four ways that small and medium businesses can manage globalization without losing their minds:

 

  • Build a process for airlifting in best practices.Drive Medical Design and Manufacturing has grown overseas both organically and through acquisition. The acquisitions forced it to come up with a way to harmonize its supply chain processes as much as possible across the globe. “The goal is to bring our systems over there and just hand them a book so they can implement quickly,” said William Cerniglia, Drive’s chief information officer. “There will be some changes in terms of local pricing or freight requirements, but we want to keep the heart and soul of distribution and warehousing as vanilla as possible.”

 

  • Plan for disruptions—don’t wait for them. Bad stuff happens in the world. Corruption, weather, uprisings—especially in developing countries. “We’re looking at more agile supply chains so we can handle unexpected events like an interruption in China,” Cerniglia says. “We want to create a lean distribution method, like Amazon, to get products to our customers faster.”

 

  • Make up for a small workforce through knowledge sharing. An increase in specialized knowledge capital that is easily sharable across borders will drive more “micro-verticalization” across industries, predicts Steve Niesman, CEO of itelligence North America, which provides technology consulting and support services. By sharing best practices and real-time market knowledge, “you can be a 10-person engineering design firm in Kankakee, Ill., and you can reach people in Taiwan because you have a specific skill set,” Niesman says.

 

  • Seed market demand before going in.Orabrush, maker of a tongue-cleaning product, has grown rapidly through an aggressive and innovative social media strategy featuring YouTube videos about bad breath. “Even though we never localized that content, it quickly went global,” said CEO Jeff Davis. “We were getting calls from countries wanting to distribute our product or put it in their retail stores.” With this “reverse-marketing” model, Orabrush focused first on creating high levels of awareness online, and then secured the distribution channels as demand grew. Orabrush now has a retail presence in 13 countries.

 

What do you think? What would you add to this list?

360.pngThis week’s SAPPHIRE NOW in Madrid has given us an opportunity to showcase customers of SAP who have  (according to industry thought leader Esteban Kolsky, ThinkJar) begun to – “deliver on the promise of CRM” with the new SAP 360 Customer.

 

So what constitutes SAP 360 Customer?

 

SAP 360 Customer is a solution that encompasses all of SAP’s technology around the customer: be it sales applications, marketing applications, service applications, and also includes the social and collaboration capabilities enabled by our latest offerings. 

 

SAP CRM powered by SAP HANA is a product introduced at SAPPHIRE NOW and is available as either:

  • An on-premise customer relationship management  (CRM) application with full integration on SAP HANA - providing better performance and faster analytics
  • Or, as part of the SAP 360 Customer solution

 

How is the SAP 360 Customer Solution Different from an SAP Product?

The SAP 360 Customer Solution includes SAP products of which you are already familiar, such as SAP Sales OnDemand, plus others that we’ve just announced: such as SAP Jam, SAP Audience Discovery and Targeting, SAP Social OnDemand SAP CRM powered by SAP HANA, and more. 

 

So - more simply put:

  • SAP 360 Customer = SAP CRM Powered by SAP HANA + SAP Sales OnDemand + SAP Social OnDemand + SAP Jam, and more…
  • SAP CRM Powered by SAP HANA = One product  that can be used stand alone , or, as part of the  SAP 360 Customer solution

 

As you check out our SAPPHIRE NOW show floor to catch our demos, or as you peruse SAPPHIRE NOW on Facebook or our virtual console, you’ll hear more and learn how customers across many different industries are providing better service, gaining better customer insights, and leveraging mobile and other channels to engage consumers with SAP 360 Customer.

rethink.jpgMost people feel like they know SAP.  We are, after all, a 40 year old company and a top-25 brand. We are in over 128 countries and have well over 100,000 existing customer relationships. But in the last few years, the company has gone through a monumental renaissance. And while this exists in our core business solutions, the passion and enthusiasm of our global employees spills over into some areas you probably aren’t aware of, but are "way cool" nonetheless. Investments into our business soltuions, global entrepreneurs, our communities, and in our partnerships with sports, arts and entertainment helps SAP become one of the most trusted brands on the planet.

 

Business Solutions

If you were listening to co-CEO Bill McDermott’s keynote today, you heard about the exiting launch of SAP 360 Customer and our solution SAP CRM powered by SAP HANA.  While this may seem only relevant to your marketing, services, and sales organizations, the bigger message is just as important for almost all businesses. “It now moves the conversation from ‘system of record’ to ‘system of engagement.’ How do you engage with your customers? What meaningful relationships are you creating with them? You can now take the traditional structured data and analyze that against new unstructured data,” intones Steve Lucas, EVP of SAP. What they say and do online can be effectively analyzed to help you make very smart decisions.

 

Acquisitions

The acquisitions of SuccessFactors and Ariba have helped enhance the SAP strategy. Global energy company Gasunie’s Category Materials Manager Richard Schriek describes it like this. SAP is the IT backbone of our administrative organization while Ariba extends our internal systems to connect with our supply chain. With both in place and integrated, we are better able to collaborate, both internally and externally, and tie the resulting benefits back to our organisation.”

 

Corporate Social Responsibility

The world needs to create more than 500 million new jobs by 2020 to provide career opportunities for the currently unemployed as well as young people who will be joining the workforce. The bulk of this challenge falls on countries in the developing world, including Brazil and India A key component to help solve this dilemma is the SAP Emerging Entre[erneurs Initiative. Around the globe, these entrepreneurs are creating businesses that have a proven proof of concept, the ability to scale, and the utilization of technology to help run their businesses in a responsible and sustainable way. These businesses also strive to address societal needs in their country or region, and help create sustainable jobs in underserved markets.

 

Brittany Lothe, Head of SAP’S CSR explains “At SAP, we view our efforts to create social impact as more than the just the “right thing to do,” but strategic to our success. We are investing our capital, talent, and technology to enhance education for underserved youth and propel emerging entrepreneurs to foster economic growth and create a sustainable future for society and our company. Our focusing on education ensures that youth have the skills required to succeed in today’s knowledge based economy while entrepreneurship helps to drive new ideas and business opportunities. At the same time, we see enormous opportunity to utilize our technology, our employees’ skills and our other core competencies to help improve people’s lives throughout the world.”

 

Communities

If you have become a customer of SAP within the last 10 years, odds are you have been a part of our “Community.” The SAP Community Network (SCN) is a collection of almost 3 million members who engage with each other through a variety of online and live activities. SAP SVP Mark Yolton describes it this way, “Customers who are active members  tell us that they gain greater speed, higher impact, improved efficiency, and extraordinary insight from connecting and collaborating with peers there.  In other words: they can solve business problems and technology challenges faster, reduce the churn and frustration spent on rookie mistakes, get higher quality outcomes by re-using the best practices of others, and benefit from the collective wisdom of SAP's entire ecosystem to give them a glimpse into the future.  At the individual level, they value the personal connections, build professional reputations, and advance their expertise and their careers by participating actively.

 

Sports, Arts, and Entertainment

If you have been listening, you may have seen some exciting news about SAP’s partnership with major brands in sports.  Our engagements with the San Francisco 49ers, the New York Yankees, or McLaren Group F1 Racing might be theee of the dozens of major announcements in recent months. Group VP of Global Sponsorships, Chris Burton, is fond to articulate it this way. “The primary driver behind the new strategy is the growing trend of "consumerization", around which new information technology is first adopted by consumers before spreading to business . Our business is changing. You’ve heard about the consumerization of information technology. That’s something that is really upon us. SAP recognized years ago that the power of the mobile device can fundamentally change the way we work.  As a result, we realized we had to tell our story in a different way and introduce new people to the SAP brand. We identified sports, arts and entertainment as platforms for the strategy. We kicked off the initiative with sports. Part of our strategy is to work with teams, leagues, arenas and stadiums to figure out how we can help them re-imagine their fan experience, or, to take a phrase from our marketing platform, ‘To run like never before.’ We’re a B2B brand, but we’re acting like a B2C brand.”

 

There is more here than meets the eye. Think you know SAP?  Think again!

 

##

 

Interested in learning more?  I will be covering SAP's SAPPHIRE and SAP's TechEd conferences here in Madrid this week.  Follow me on Twitter @toddmwilms or connect on LinkedIn at any time. I would love to collaborate with you on these ideas.

Remember Malcolm Gladwell’s book called Blink?

 

Gladwell argued that we should trust our snap judgments, using examples from science, advertising, medicine and music.  These examples showed that spontaneous decisions were as good as, and usually better than, carefully considered ones.

 

In Wait: The Art and Science of Delay, Frank Partnoy takes the exact opposite point of view.  After interviewing more than 100 experts from different fields and examining several hundred studies, Partnoy claims that most people don’t take enough time to make decisions.  Using a Gladwell-esque style, Partnoy argues that the best decision makers – premier athletes, expert investors, and even popular comedians – hone the ability to wait as long as possible before deciding or acting.

 

I’m writing this blog  while watching a professional baseball game and the game itself reinforces Partnoy’s claim.  The best hitters are the ones who wait the longest time to make a decision about whether to swing at a pitch.  The swing has been practiced so often it’s mechanical and not the important differentiator. The key to being a good hitter is to gather information about the ball as quickly as possible, so as to leave time to process this information and make a decision on how to swing.  “Ball identification” is analogous to sizing up a situation in business.

 

In a recent Financial Times article, Partnoy uses a nearly identical example from Wimbledon to explain a parallel situation in the business world.  As he writes:

One of the most surprising aspects of Lehman’s collapse was that the firm’s leaders had tried so hard to understand the problems associated with their own decision-making. In autumn 2005, Lehman’s senior managers hired a group of experts to teach four dozen top executives how to make better decisions. Malcolm Gladwell, who had just published Blink, gave the capstone lecture.

These managers sat for a cutting-edge course on the timing of decisions. Then, they rushed back to their offices and made some of the worst decisions in the history of financial markets. Three years later, their firm was gone.

If Lehman had lived until today, its decision-making course would look radically different. The core message of recent research is the opposite of the one Lehman’s executives learnt in 2005: the longer we can wait, the better. And once we have a sense of how long a decision should take, we generally should delay the moment of decision until the last possible instant. If we have an hour, we should wait 59 minutes before responding. If we have a year, we should wait 364 days. Even if we have just half a second, we should wait as long as we possibly can. As the matches at Wimbledon will illustrate, even milliseconds matter.

 

Scientific research supports both Gladwell’s claim we should trust our gut assessments and also Partnoy’s claim we should wait until the last possible moment to make a decision. So which one should you do?  The answer, of course, depends on the situation you are in — this is the art of decision making.

 

But, if you can’t make up your own mind on how quickly to make decisions, my advice can be captured in one word: Wait.

 

Follow me on twitter @jbecher.

 

This blog was originally posted on Manage By Walking Around.

Social-Media-Collage.jpgAfter Facebook released its earnings for the second time since going public, the ubiquitous issue of monetization reared its head. There are over 200 major Social Networking communities and sites with a substantial number of users, in fact there are over two dozen with 100 million plus users. No matter how attractive the user numbers are, at the end of the day, it is money and revenue generated that’s of interest to the shareholders. And monetization is the challenge social web sites generally face.

 

The most obvious and arguably crudest monetization practice by most of these online communities, is to sell advertising. Other examples include selling email and username, and other social data to various marketing firms.  Although more creative approaches have been  sought to deliver more relevant and meaningful ads in context of the user preferences - for example, utilizing various data mining and other such tools -  it hasn’t borne overwhelming results and consumers are actually turned off by the ads (or are at most - indifferent to them). Very rarely if ever does a consumer actually click on the advertising no matter how relevant or in-your-face the content and presentation may be.

 

 

The goal of any “social” site is to create a virtual community and environment conducive to developing relationships - either personal or professional - with likeminded individuals or organizations, and to make this relationship a constant and integral dimension of “online life”. The challenge Social networks face is driving this engagement, to be a perpetual extension of one's social sphere of interaction - not just occasionally - but constantly. The majority of users regularly check their social networks for updates or other occasional interactions but these brief and focused activities often times do not drive community, these activities are about as engaging as checking your email once in a while. This brief interaction – more often via mobile – does not benefit the social networks - in generating valuable data to be sold to advertisers and marketers - nor does it facilitate ad revenue either.  Occasional or brief users will rarely bother visiting or clicking on the ads. The only way to increase engagement is to entice individuals to change their behavior through the use of a reward system such as loyalty programs within social networks.

 

How does this loyalty program work? By rewarding  activity on the social site such as  status updates, check-ins, photo uploads, profile updates, or any other social data – generating online behavior; points, ratings, rankings, badges, are awarded and visibly tracked. These points can be used to download apps or even purchase online gifts, messages, e-cards, etc. or these can then be redeemed at various Social Networks’ advertisers and partners.

 

Although similar kinds of programs have been initiated in the past by some dotcom legends, social networks have rarely seen this in the form of loyalty programs. The goal of such a program is not to develop an e-currency but to encourage sharing, engagement,  and to facilitate the collection of more detailed user information (more so than what is currently available) which can then be shared with marketers and advertisers. Providing incentives to users will drive engagement as well as create additional revenue streams and increase the partner possibilities. Think: a loyalty program run by an airline – and you’ll get the idea.

 

Its application in the real world would be through partnering with local businesses who will pay to leverage the network for the marketing information while passing on discounts (not providing “freebies”  so that there is no cost being passed back to the network) for their products and services. The social site’s user is getting “deals” as well as monetary incentives - to browse and share more information - and the marketers are able to target users more expeditiously and effectively based on that additional information they gather.

The future of these loyalty programs for social networks could be location and event based marketing, and potentially the move by the social site itself into the retail business, where points will actually buy merchandise at their own e-store or retail outlet.

 

Loyalty for Social networking sites may sound good conceptually but without the technology to support this, it would just be a pipe dream. Social networking sites have millions of users (each of these will generate hundreds of millions of transactions per minute). SAP CRM on HANA provides the processing power to actually calculate the accruals and redemptions that the hundreds of millions of transactions will generate.  SAP HANA with its powerful processing capabilities will facilitate the complex calculations needed as well as providing customer insight based on enterprise-wide data in real-time, paired with powerful predictive analytics, making this insight available at all customer touch points, and support all customer-critical business processes across and beyond the front office with the highest accuracy and speed.

 

A loyalty program incentivizes customers to stay connected to the social network and provide information which can be marketed for revenue. At the same time, loyalty programs provide an all-encompassing customer experience and create a mechanism where consumers are rewarded for their online activities, making a win-win situation for the community overall.

Author’s Note: Happy Veterans Day!

 

“The impact of Dodd-Frank for foreign banks is going to be widespread and long-lasting,” according to a recent report by Boston-based research and consulting firm Celent. “The new rules would alter the trading strategies and operations of most of the large swap trading firms globally.”

 

Dodd-Frank Global Culture Change 11-12-2012U.S. firms would see less international business if those foreign banks dodge new compliance costs by curtailing their American trading activities. Celent released its report last week, as foreign regulators warned the U.S. Commodity Futures Trading Commission (CFTC) that its proposed new derivatives rules could brutalize global markets.

 

The Dodd-Frank Wall Street Reform and Consumer Protection Act is a complex beast, and its potential impact on international transactions made it the hottest topic at last week’s Sibos Osaka 2012, according to Ruth Wandhöfer of Citi’s Global Transaction Services. Yet much of Dodd-Frank is behind schedule, with the bulk of it still unwritten.

 

The ever-nebulous implications of such a far-reaching regulatory scheme is a source of concern for many financial institutions in the U.S. and abroad.

 

Beyond the Sea

 

Regulation in Europe is running late too, as many of the 28 too-big-to-fail Global Systemically Important Financial Institutions (GSIFIs) will not finish their living wills -- instructions for avoiding systemic calamity if the bank fails -- by the year’s end, according to The Financial Times. Meanwhile, only about one-third of Basel Committee on Banking Supervision member nations are likely to enact Basel III reforms by the intended deadline in January.

 

“There is more to be done,” said Wayne Byres, general secretary of the Basel committee. “We have not yet completed the full set of policy reforms.”

 

Reforms include more than tripling capital surcharges -- cash that banks keep on hand to help weather another financial crisis. Chinese banks may go even farther than Basel III rule changes, though the China Banking Regulatory Commission offers a longer transition period -- up to 10 years.

 

Risky Business

 

But Dodd-Frank’s Volcker rule will likely have the greatest impact on trading systems, reining in banks’ risky behavior via special rules for large traders and market access.

 

“These rules require that trade transactions be monitored, certain calculations be moved closer into the trade order generation process, and more transaction level details be retained for audit reasons,” SAP’s Sinan Baskan told Markets Media. “New applications that consume detailed data will be developed and executed at trading time, and the data retention needs will add to the data warehousing capacity requirements.”

 

Culture Shock

 

Complying with those requirements will be expensive for many firms, making the Volcker rule a thorn in the industry’s side. But Dodd-Frank is even more popular in the U.S. than President Barack Obama’s healthcare overhaul, according to a Gallup poll, diminishing the likelihood that lobbyists can seriously limit -- let alone scuttle -- financial reform.

 

“With the advancing regulatory legislation, financial institutions are beginning to recognize the weight near-real time and accurate risk infrastructure holds within the front office,” SAP’s Stuart Grant told Markets Media. “Allowing the trading desk to employ risk controls that are industry and regulatory compliant will require investments in technology, risk strategy, innovation and culture change.”

 

Indeed, there should be a culture change that embraces simpler financial instruments and tighter compliance. Responsible regulation would make the industry safer for everyone in the 21st Century.

 

Related Articles:

 

For global investors, Fed relief trumps fiscal angst after US poll” by Mike Dolan

 

Dodd-Frank extraterritorial concerns remain” by Bruce Love

 

Biggest banks given extra time on reform” by Brooke Masters

On weekends I enjoy long hikes in the hills around my house. It relaxes me after the work week and my mind wanders to new ideas. Of course, it’s also good for my health. Mostly.

 

Lately I’ve noticed a disturbing trend. I often go to lunch with my hiking companions after a few hours on the trail and even my healthiest acquaintances make calorie-laden dining choices. It feels like a reward after the strenuous exercise.

 

After a little online research, I discovered this phenomenon is called the health halo effect. When we do something healthy, we are more likely to follow it with something indulgent. In fact, we believe the indulgence is literally negated by the healthy acts.

 

Researchers have found that people who order a healthy main dish are more likely to order higher calorie side dishes and desserts. Research also shows, if you pair a cheeseburger with a green salad, diners estimate the meal has fewer calories than the same cheeseburger served by itself.  As the researchers report, it’s as if the diners believe that “putting lettuce on a plate can magically make calories disappear.”

 

Of course, there’s no magic trick.  The healthy main dish and the green salad are examples of the halo effect.  They cloud the diners’ judgment, making them feel like they are eating a healthy meal.  The effect is even more pronounced with dieters, who presumably should know better as they are used to counting calories.

The healthy halo effect is not limited to poor choices on side dishes. Studies show that shoppers who purchase chocolate for a charity will reward their own good deed by eating more chocolate.  People who purchase a gift for others feel so generous that they decide they should treat themselves to a gift.  And shoppers who purchase a bargain feel so good about the deal that they buy more than they originally planned.

 

The next time you reach for a candy bar to go with your diet soda, remember the health halo effect. You’re only fooling yourself.

 

Follow me on twitter @jbecher.

 

This blog was originally posted on Manage By Walking Around.

Mobile BusinessOne of the benefits of being a part of a truly global company is the ability to talk to world-class organizations around the globe. Not just “big business” or the “enterprise,” but amazing companies of all sizes, across multiple types of industries. One key thought-leader and SAP executive at the center of many of these conversations is Steve Lucas. Steve helped synthesize these problems during a sit down last week.

 

Their biggest dilemma is one which everyone is talking about: Big Data.  What do companies do with the monstrous amount of data available to them across a variety sources? Just about every movement a person makes online can be tracked – but what is valuable and what is just noise? How do we make that data actionable with our people in our organization – from those high atop our corporate headquarters down to our service and support people in the field, those in the center of the action?

 

When you listen to those disparate voices, you start to see patterns: patterns of need, patterns of business problems.  One of those patterns rises to the top.

It is the “design pattern of the decade.”  Every decade has one.

 

30 years ago it was all about this new thing called a database. We were amazed you could collect and then search on stuff.

 

20 years ago it was all about this new thing called analytics. We were amazed you could not only collect and search on stuff, but you could start making smart choices about what people did.

 

10 years ago it was all about this new thing called predictive analytics. We were amazed you could not only collect, search and analyze past behavior, but you could now have some insight into what people would do next.

 

Now it is all about this new thing called sentiment analysis. We are amazed you can collect, search, analyze and predict, but now you can tell how people feel about their decisions – to connect with your customers in ways never before dreamed.  You can achieve a level of engagement never before experienced with the market and your customers.

 

The design pattern that allows this to happen has 5 components.

  1. Database – where you store all this great data.
  2. Application Platform – what allows you to access this data by vast infrastructure.
  3. Business Applicationswhat gives you your lens into this great data.
  4. Analyticswhat helps you understand your customers.
  5. Mobility – what allows your organization to make this insight actionable where and when it matters most.

 

80% of business problems are solved with this design pattern. Think of it like this: Big Data, analyzed in real time, through the cloud, and sent immediately to a mobile device (to your folks with the smartphones and tablets.)

 

Does this solve every issue in the marketplace for every business?  No. Alas few things are 100% of everything.  However, 4 out of 5 of your business problems can be solved by knowing how to collect and analyze all of this data, and get it to your people to allow them to make smart decisions which will impact your customer relationships.

 

Does this sound familiar to you and your business?  Steve has this conversation over and over again.  His advice is simple:  Ask yourself who is innovating in these areas?  Who is making strategic investments to create, align, and integrate these 5 layers?  Who sees it all, from the big picture all the way to the tactics right alongside with your people in the field?

 

Your problems are tough, but your answer shouldn't be.

 

##

 

Interested in learning more?  I will be covering SAP's SAPPHIRE and SAP's TechEd conferences here in Madrid this week.  Follow me on Twitter @toddmwilms or connect on LinkedIn at any time. I would love to collaborate with you on these ideas.

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A gap has always existed between companies and customers. Top management formulates a brand promise, and through messaging, packaging, sales, product/service delivery and other means, it works to fulfill that promise.


But as author Michael Hinshaw points out in his book Smart Customers, Stupid Companies and in a recent blog post, that gap is no longer tenable. In fact, leaving it open can lead to a weakened and even failed competitive position.  In other words, with apologies to our London tube-riding friends, it’s time to go beyond “minding” the gap and start closing it.


Consider that in today’s world, social media, mobile devices and the always-on Web have filled the company-customer gap with so much noise, opinion and distraction that most brand promises never make the full journey from corporate boardroom to customer ear. Messaging meant to shape customer opinion never makes it past the customer reviews, recommendations, blog posts, price comparisons, mobile apps, etc., that are swirling around the Web.


Because of this and other shifts (empowered buyers, the knowledge economy), Hinshaw and others suggest we are long overdue for a change in management practices that effectively close the company-customer gap.


It all hinges, the new thinking goes, on the employee. As Gary Hamel argues in his book, The Future of Management, the vast majority of enterprises still operate via management models designed for an unskilled labor force manufacturing widgets. Those models are not effective for knowledge workers in a knowledge economy, especially with today’s mandate for innovation, agility and customer centricity. This is particularly true for the workers with direct access to customers, such as sales professionals.


Rather than micro-managing sales professionals and other workers, businesses need to empower them to execute their jobs effectively, and management needs to support the decisions and efforts that they make – at the point of interaction -- in order to deliver a great experience to customers. It is front-line employees such as salespeople, after all, who most directly represent the company and its brand to customers. As Hinshaw argues, your employees are your company.


Another proponent of the employee-first management model is Vineet Nayar, CEO of HCL, whose book Employees First, Customers Second calls for a radical shift in top management and employee roles. Rather than putting the CEO at the top of the pyramid, Nayar suggests elevating employees to that top spot. “Value gets created between the employee and the customer,” Nayar says, “and management’s job is to enable innovation at that interface.”  


To me, it’s really all about promise management, a concept that is fully described by thought leader Reg Price in  a book he co-wrote,  Reliability Rules. Businesses are a web of promises, and at a basic level, their success turns not just on the promises they make to customers but also to their employees. How can we hope to make customers feel happy and valued if our employees – and, importantly, sales professionals -- don’t feel that way first? And to make that happen, businesses must shift their attention toward delivering on the promises they make when employees are recruited – you know, all those nice words about the importance of individual contribution and “our employees are our biggest asset.”


Simply put, the promises that companies make to customers are only as good as the ones they make to their employees, because it’s employees who deliver on brand promises to the customers. It is only through employees that companies can hope to speak directly into the customer’s ear when so many other voices are trying to do the same thing. It is only employees who can close the company-customer gap.


As Hinshaw warns, an employee-first management model requires changes in corporate culture, working conditions and compensation. I also believe it requires an investment in systems infrastructure and tools that deliver customer information and insights to all employees throughout the organization.


When I look around, I wonder if the C-suite realizes how outdated their management practices are in light of the clear changes that are right before their eyes. The ability to disrupt exists for those leaders willing to move their enterprises into uncharted territory by embracing and championing change by putting their employees first.


What do you see in your business interactions today – do your employees seem empowered and ready to deliver on brand promises? Please share your insights, opinions and tips with us.

CFO's typically don't care much about technology.

And especially when it comes to newer, emerging, and therefore potentially risky technologies! Figuring out technology is a job for the CTO or CIO, right? After all, Chief Financial Officers have their hands full with reducing cost and risk, driving process and organizational optimization, increasing governance and transparency and providing business information to the decision makers.
Pundits agree, however, that the role of the CFO is changing. That CFO's are being challenged to be a partner to the CEO, drive mergers and acquisitions and other strategic projects and generally step up to the role of "CEO in Waiting". CFO's must evolve the spectrum of their teams from accounting &  controlling to optimizing business fundamentals. Routine tasks such as maintenance of the books are still essential. CFO's, however, need find ways to establish more bandwidth for corporate and strategic tasks, and to add more dimensions to decision-making and strategy. They have to move embrace the needs of both internal and external stakeholders, and they need to move beyond a pure cost and profit perspective into a value creation perspective: providing insight 24/7 in a dynamic economy that has evolved beyond traditional limits of location, distance and time.
Well then! Isn’t this even more reason for the CFO to turn a blind eye to technology and focus on business transformation topics?
Recent studies, however, like IBM's CFO Study done in 2006, 2007 and 2012 show that CFO's and their teams are not making enough progress towards becoming a more strategic partner to the business and are still "stuck in transaction processing", focusing on reporting and consolidation, process optimization and other back office tasks, only rarely stepping into the lime light when it's time to report results. Not much has changed in the last 5 years.
What's missing?
One of the key problems, among many others, that is keeping accounting departments "stuck in transaction and consolidation" is that decision makers are never happy with the timing and depth of their reports. Installed financials systems are often based on proprietary applications with independent data stores for preparing the balance sheet, income statement, profitability reports, liquidity forecasts, or KPIs for project leads and line managers. Data retrieved from these different applications often does not match up without additional explanation and reconciliation. Users are therefore often justifiably skeptical about whether they can trust the data. Furthermore, the reconciliation process can be extremely time-consuming and ties up valuable resources. A customer recently told us: ”We have an entire department just for reconciliation.“ Next generation financial systems need to deploy a single real-time data store for all reporting requirements – turning reconciliation into a “non-event”. The business architecture of the financials solution is therefore of decisive importance not only regarding the compliance-relevant topic of reconciliation but also, for example, regarding the scope and quality of the business content delivered by the solution.
So what's the answer?
Maybe it’s time to challenge some of the assumptions and established processes. Maybe CFO's should look towards new technology and new software to accelerate progress and transform their business even faster? After all, in the areas of Customer Relationship Management and Human Resource Management, cloud-based software solutions have been making rapid inroads into large enterprises:
  • Delivering faster time to value,
  • Eliminating up-front capital cost for systems,
  • Providing a predictable service subscription model,
  • Reducing or even eliminating in-house infrastructure and IT cost and staff requirements, and
  • Generally providing a more agile, business-user centric interface that requires a minimum of learning.
"Ok, OK", you might be thinking, "CRM and HR are one thing, but core financials are another ball park altogether!"
Understood. This is a new and evolving area and deserves a closer look. Here are some of the benefits of a cloud-based financials solution when it comes to empowering the CFO for business transformation. The benefits of such solutions come in three main flavors.
  1. Transformation
  2. Agility
  3. Collaboration
Let's drill down into these areas into a bit more detail.
Transformation
Cloud-based financial solutions can more easily tap into and deliver the latest technology innovations since the customer does not have to set up the technological infrastructure or manage the systems by themselves any longer. This enables CFO to unlock more business value faster for all employees without having to go through cumbersome technology upgrade cycles. These systems, of course, cannot just rest on the laurels of new technology. They still need to provide the best practices, scalability, deep process controls, automated workflows, strictest governance, security, compliance and globalization-readiness CFO's have come to expect from their existing enterprise financials solutions. A sound balance between the technical wizardry of cloud, in-memory, mobile and collaboration tools and sound financial expertise, as well as availability of a strong ecosystem of partners and system experts should become a key selection criterion for picking the right cloud financials package. Another key benefit of cloud financials is that these new solutions can be designed from the ground up with the business user - not just financials experts - in mind.
  • Supporting the mobile workforce.
  • Delivering real-time insights, fine-tuned to personal KPI's.
  • Eliminating the need for periodic data consolidation from multiple specialized ledgers.
  • Removing the need for pre-defined data aggregations.
  • Allowing the business an up-to-date view of their financial state, any time, without having to wait for batch runs.
With the right solution, this ability to deliver relevant, personalized business information in real real-time, founded on a single-source of truth for financial analytics can become the key driver for faster business transformation for the CFO.
Agility
Cloud-based financial solutions carry the cloud "genome" by design. They are built for faster adoption, are easier to learn, and are much easier to adapt to specific business requirements than previous systems. The configuration of financial process controls, employee access permissions and prepackaged financial reports should be doable with a few clicks. The software can be quickly personalized, by the end users themselves. And the software is kept up to date automatically, allowing customers to consume new capabilities much more rapidly.  This is a key benefit for any CFO looking to minimize their exposure to aging or obsolescent technology in their IT infrastructure. There simply won't be any technology to go obsolete, since the data centers is run by the cloud provider leveraging experience, economy of scale and innovation speed for agility. 
Agility, however, is not just a technical aspect. It also relates to the agility of the whole organization to sense and respond to changes in the business. And it relates to the agility of the CFO to set up and roll out organization wide information packages or new rules and processes. Since the software is running in a secure cloud data center, access to the corporate financial processes can be more easily achieved from any location, and from a wide variety of devices. The utilization of modern in-memory data base technology largely removes the need to establish separate data warehouses for reporting. And information consumers do no longer have to wait for end of period consolidation and reporting runs to have an accurate view of their business. As these systems mature, the agility also relates to the ability to go beyond real-time insight into forward looking financials, thereby improving forecasting and risk management capabilities.
Collaboration
The third aspect of cloud-based financial solutions is anchored around the topic of collaboration: Collaboration between people, between departments, between businesses, industries or market communities. Cloud-based systems are born and live on the internet, inheriting the open standards, global distribution and rapid innovation cycles driven by millions of people using internet systems and infrastructure online. To achieve business transformation for the 21st century “glocal hyper-speed” age, businesses need to learn to operate with internet speed, flexibility and openness. This is why cloud-based financial systems can form a new “backbone”, a new financials engine for the financial information supply chain. Engines that can connect information, people, processes and rules into transaction teams and open collaboration groups. Specifically, these new financial systems need to allow business users not just to consume real time information from any device, but also take instant action on the information. Action in the form of tagging the information and sending it on to the right expert. Action in the form of instantly forming collaboration teams of experts to enrich the information. Or action in the form of affecting and adjusting the core processes that generate the information.
Poetically speaking, it was once said by John Donne:

"No man is an Island, entire of itself; every man is a piece of the Continent, a part of the main".
The same can be said of every employee, every department, business unit, corporation or industry. Collaboration is "baked into" the new cloud-based financials, and can therefore help CFO's in their quest for business transformation.

Some of you might say at this point:
"Chris, this is all fine and dandy, and it sounds all very technical, but where is the real relevance to the job of the CFO, or the financial department in general?"

Let me try to give you some food for thought on where this fits in.
If you simply type "CFO of the Future" or "Role of CFO" into a Google search, and just read a few of the dozens of documents that popup, you will quickly see a number of key trends emerging:

The CFO of the future will be asked to:
  • Optimize the business, but become a strategic advisor at the same time
  • Continue to be the steward of all corporate assets but act as "CEO in Waiting"
  • Deliver value-add to the business in a proactive fashion
  • Drive business transformation by supporting the new dynamics of the economy
  • Drive organizational change and leadership by supporting the new agile style of work
  • Deliver real-time, or even forward looking financials, not just reporting and consolidation
I hope you agree that - if the above predictions are true -  the financial departments and CFO's of most companies need a new approach to achieve the above objectives. An approach that delivers the business architecture for this business transformation. An approach that brings together technology and financial expertise into a single solution. Once this approach is deployed, I believe any enterprise can lay the foundation for this transformation. A transformation driven by the potential of instant availability of relevant information to every business user in the company. Information based on real-time, reliable data and analytics that reflect the nature and state of the business. A transformation driven by the ability of the users to instantly act upon such information. And driven by the ability to establish and drive collaboration between people and systems with unprecedented ease.
Sounds too good to be true? Heard it all before, but did not happen?
I fully understand such skepticism. After all, we are talking about transforming core financial systems here! But I am not talking about a rip-and-replace approach. I am talking about a gradual, managed transition that deploys these new technologies in areas where they make most sense. Fast moving business units. Mergers. Acquisitions. Joint-Ventures. Subsidiaries. Consolidations of fragmented ledger landscapes. Global Rollouts. Or, for medium sized businesses, the full replacement of an aging system after a proper due-diligence procedure.

There are endless possibilities, and they should be explored to take advantage of the rapid development of cloud technology for the area of financial management.

I'd like to close here. I hope I have given you a bit of a perspective why the CFO should give the CIO/CTO a call, sit down for a cup of tea or coffee and talk about modern cloud-based financials solutions. What is available now is just a glimpse of things to come and I look forward to the journey ahead.
Maybe we meet on the road.
CHHO, Vierkirchen, November 10, 2013

Earlier this year SAP Partner Service Delivery (PSD) launched a new services portfolio comprising two levels of support for members of the PartnerEdge program who want to expand their business in alignment with SAP. The first level of support is through contact with a dedicated partner service advisor (PSA), who works with the partner to identify SAP resources, programs, and experts that can help  the partner to grow its SAP business.

 

Interested in learning more about how PSAs assist SAP partners? Then read my latest article in SAP.info: Reaching New Markets for Mobile Apps. If you want an even more detailed look into how PSAs provide direct and personal service to SAP partners, check out The One Thing Millions of Followers Really Want – or, via Twitter, follow PSAs Hy Pailakian (@SAPPSA_Hy) and Francois Lapalme (@SAPPSA_Francois).

 

Beyond the valuable work that PSAs do, SAP Partner Service Delivery also has specialized resources to deliver this knowledge transfer on a technical level, making sure that partners have the tangible means to execute confidently on their SAP-aligned business strategy. This support, provided by specialists in the PSD Service Portfolio team, is delivered through targeted partner enablement initiatives that can include 1:1 focus sessions, workshops, webinars, and additional materials to enable partners to gain solution and implementation expertise in new SAP-related technologies that complement their own business strategies, such as Mobile or SAP HANA.

 

In my article for SAP.info, I also go into detail about one of these programs – Mobile Applications Partner Program (MAPP) – that supports partners in creating apps using the SAP Mobile Platform, getting those apps certified, and then placing them in the SAP  Store. The article examines how Smartsoft, an SAP partner based in Atlanta, found out about the program through its dedicated PSA, Ryan Casey, and is now using it to raise visibility for its offering in the mobile apps market.

 

Through researching the article, I spoke with SAP experts who provide partner enablement support for each of SAP’s market categories. In addition to MAPP, there is also a PSD Reseller Readiness Initiative for the mobile market that educates partners about SAP mobile solutions, specifically Sybase Unwired Platform and Afaria. Partners can get familiar with these products, the path for reselling them, and how to get product authorized. 

 

In the category of analytics, PSD offers the Demo Readiness Initiative, meant to help partners install and configure an on-premise Business Intelligence 4.0 demo environment – a real asset for customer presentations. This program is especially useful for SAP All-in-One partners who have recently become BusinessObjects partners. Delivered as a remote or on-site workshop, SAP experts walk partners through the installation and configuration of their in-house BI 4.0 demo environment. The workshop spans two days, for 4 hours each day. On-site workshops have also been held in Korea, China, and India this year with highly positive participant feedback. Ana Ebeling, the global lead for analytics within the PSD Services Portfolio team, reports that the workshops have been a success and that nearly all partners leave with their demo system set up. She says, “This highlights the value of having the demo on your notebook, which you can take with you to visit customers.” To find out more or sign up for the next workshop in your region, contact your PSA. 

 

In the category of database & technology, PSD drives the global SAP HANA Adoption Initiative, which has already involved over 350 partners since it was launched in middle of this year. It creates awareness and transparency in 1:1 sessions about the SAP HANA portfolio, the accompanying enablement resources, and the next steps to qualifying SAP HANA rapid-deployment solutions. “This PSD initiative has already led to over 90 partners participating by having their SAP HANA rapid-deployment solutions qualified for placement and go-to-market in the SAP EcoHub, which we think will demonstrate a significant contribution to revenue in Q4,” says Frank Bunte, Global Head of PSD Service Portfolio, owner of the initiative. Another initiative in the PSD service portfolio is the Sybase Database & Technology Portfolio Enablement program, which helps existing SAP partners to better understand the Sybase product portfolio and gain more expertise to sell Sybase products.

 

If you are an SAP PartnerEdge member interested in finding out more about any of these programs, contact your PSA, who will gladly get you on your way to expanding your SAP business.

Dogs in Swaziland.pngDon’t miss Saswato Das’s account of his SAP Social Sabbatical in Pretoria, South Africa, where a team of 11 SAP colleagues are bringing their expertise to Non-Governmental Organizations (NGOs). “We will learn from them and, hopefully, contribute something in return,” writes Saswato.

 

Saswato is working with the NGO Solutions for People with Disabilities. You can read about the challenges of being disabled in South Africa, as well as the dignity of labor that comes with having a meaningful job that such an organization can provide.

 

“We want to achieve, we want to help ourselves and survive. We want to get more skills.”

 

Read how SAP volunteers traveled to the village of Ndlangeni to visit children who have been orphaned by AIDS. “Even though it was not far, it took us a good while to get to the village that was our destination ... For those of us who went to Swaziland, it opened a window to the real scourge of AIDS in an oft-forgotten part of the world.”

 

In his Pretoria Diary, Saswato chronicles this social sabbatical. You’ll find insights, photos, and facts that you didn’t know about the stray dogs of Swaziland.

 

Join the SCN sustainability community to learn more about sustainability and SAP's commitment to corporate social responsibility.

 

velvet_underground_a_p.jpgOnly the Velvet Underground could provide such bare contrasts between their world of lacerating noise and squalid cityscapes, and many of their peer musicians’ world of rainbows and escapist indulgences. Yet even as the Velvet Underground’s career as a group was drawing to a close, they coolly concluded that “it was alright”. And that is our conclusion as well regarding the increasingly wearying on-premise/cloud debate, one also marked by conspicuous contrasts between worlds. There is a story to tell about it all, but we are already way ahead of ourselves.

 

Let’s begin with a much more prosaic contrast between business analysis and analytics, a difference made clear by the ongoing debate about whether an organization should transfer computing operations to the cloud or remain on-premise.

 

Business analysis tends to model such choices in terms of value, focusing on concrete, often retrospective measures of cost objects and processes. Business analytics takes a more holistic look, considering organization competencies that would be enhanced, while understanding that both computing options belong to a socio-technical system whose tradeoffs cannot all be reduced to last century’s efficiency metrics.

 

With regard to IT expenditures, the business analysis view is highly market-oriented, giving a lot of attention to product features and functions. Thereby it reflects the confusion in the market quite accurately, as a pair of advertisements in a recent Economist print version (October 13, 2012) illustrates marvelously.

 

In previous months, Oracle regularly advertised on the outside back cover, featuring Exadata, its on-premise solution, and performance comparisons with IBM data warehouse products. Oracle’s advertisements typically contained minimal graphics, text, and color, following a simple tabular layout. In contrast, SAP took out infrequent ads, which were displayed opposite columns, using stylized photographs set in a broad palette, yet not promoting any particular product, but rather its Run Better theme.

 

In the October 13 issue, Oracle kept to the familiar template and graphics, but replaced Exadata headline text with cloud computing descriptions, and added a cloud illustration. In this same issue, SAP pixelated its usual atmospheric photograph into a rough zigzag pattern, describing its on-premise offering, HANA.

 

To an analytics person the pronouncements in these advertisements might seem puzzling. Oracle has been a relative latecomer to the cloud market, led by a CEO who previously dismissed cloud computing outright, then suddenly and headstrongly embraced it later. Equally perplexing is SAP’s unequivocal reinforcement of its investment in on-premise solutions, while neglecting any mention of solutions facilitated by multi-billion dollar acquisitions of best-in-breed cloud providers. Both messages will likely be opaque to readers who might be perusing these pages on a Saturday afternoon, yet have only casual exposure to enterprise computing market stridency.

 

A better way to understand key differences between cloud and on-premise is to step away from myopic business analysis techniques. Applying an analytics approach instead, we seek to understand how each option follows the structure of the organizations that actually use them. Thus, most organizations can be divided into core and periphery, where the core contains the unique knowledge, competencies, processes, and staff, and the periphery the complementary resources which the organization needs to perform, but for whatever reason lacks.

 

Cloud: Throw out the hardware

 

Cloud computing requires a small core but a large periphery. More specifically, cloud computing requires an organization to own minimal IT resources, and provides numerous options for distributing IT operations across vendors and locations. An organization need only have a small core of administrators but can make use of a large periphery of service providers, contractors, vendors, and consultants.

 

A cloud arrangement can be thought of similarly to the jazz-rock group, Steely Dan. Known for very high production values, precise sound, and elaborate, urbane, and sometimes impenetrable lyrics, the group has consisted for nearly three decades of only two core members, with dozens of session’s players at the periphery. Seldom did the core retain the same session’s personnel from one album to the next. Steely Dan remained a durable group that successfully preserved its recognizable sound and refined musical atmosphere, although it did experience a mid-career breakup as the periphery grew excessively large and alienated from the core.

 

A cloud arrangement signals to outsiders that the organization lacks sufficient economy of scale to make on-premise computing worthwhile, and the market can supply needed services more cost-efficiently. Cloud can favor smaller or less mature business functions, such as HR in new media or recently formed tech companies, or business functions in high growth companies or high volatility industries where scale is critical. However, management of several vendors may be necessary, and security costs must be considered along with direct costs.

 

On-premise: Big wheel keep on turning

 

In contrast to the cloud, on premise computing employs a large core and a small periphery, which often reflects the structure of well established, stable organizations. On-premise requires significant investment and maintenance of IT resources, and a staff who collectively oversees a set of unique competencies. On-premise will still require a periphery of consultants, particularly for implementation, customization, and upgrades. Yet the core will likely have developed numerous applications in-house, addressing unique business processes and value drivers.

 

The on-premise solution can be characterized by the folk-rock group Creedence Clearwater Revival. Also famous for high production values and crispness of sound, its songs are earthy and approachable, covering Southern Gothic and working-class themes. The group defined clear roles for its core personnel, which consisted of four musicians (two of whom were brothers). Their tightness of sound came about by playing as a unit uninterruptedly since teenhood, refined by some very lean periods. The group had almost no periphery, seldom working with session’s players or collaborators. Though durable in its early years, Creedence Clearwater Revival’s core produced a taut working arrangement that later became vulnerable to personnel changes in the core. The departure of a guitarist precipitated a quick decline and dissolution of the band, which by then had sealed off its core so tightly that no one from the periphery could replace a core member.

 

On-premise is cost-beneficial in organizations that have sufficient resources to provide scale, yet require more custom solutions. It often favors large, mature business functions in established, hard capital-intensive industries, or firms with significant institutional memory to preserve.

 

Hybrid: Go your own way

 

Hybrid computing accommodates a changing core and periphery, which characterizes business functions in many organizations. Rapid development of new markets, technological changes, global competition, and economic uncertainly, all require organizations to adapt quickly. Computing needs may need to scale in either direction, and competencies must be as readily available as services. Organizations and their computing resources must both be highly agile.

 

Most popular music groups could been seen as similar to hybrid computing. With ever-changing personnel, rapid career evolution, and reversals of fortune, the core and periphery frequently shift. Some groups, such as Fleetwood Mac go through several reinventions during their careers before achieving great success. Others follow a life cycle of first playing in clubs and ballrooms, later in sports arenas, and finally at fairs and casinos. A flexible core and periphery permits durability, even if a group ceases to perform or record for several years. Peripheral studio musicians may join the core, or core members may depart and their roles become absorbed by the periphery. As with Steely Dan and Creedence Clearwater Revival, where disproportions between core and periphery occurred, a flexible core and periphery also carries risks. There is never a guarantee that any rearrangement of core and periphery will align resources optimally for success, adapt an organization to market changes, or not cause unintended disruptions.

 

Hybrid can favor business functions that are likely to expand, reorganize, or be affected by a change management initiative. Organizations that lack a cloud strategy may find hybrid a feasible alternative. While cloud and on-premise decisions might occur in concert with business cycles or as part of major planned capital investment initiatives, hybrid decisions can occur off-phase.

 

You set the scene

 

No arrangement of core and periphery need determine the destiny of an organization. Nor does the IT arrangement that works in parallel restrict the range of what on organization can perform. Each of the groups discussed earlier, though having clear organizational structures, contained rather remarkable contrasts.

 

Most of Steely Dan’s work contains bitterly cynical and prickly lyrics. Yet they are also capable of extraordinary warmth and devotion, in sitting with a disconsolate friend in “Any Major Dude Will Tell You”. Everyone should be so fortunate to have that kind of friend in time of need.

 

Creedence Clearwater Revival portrayed a world of legend and nostalgia in much of their work. But perhaps better than any clamorous protester, they gave voice to the pressing injustices of society in “Fortunate Son”, and the dread of the times in “Bad Moon Rising”, using the very words of the people who were directly experiencing them.

 

And from a heritage of rather undistinguished experiments, Fleetwood Mac produced Rumors, one of the precious few rock albums that maintains enduring appeal far beyond the genre, appearing universally in music collections regardless of the prevailing taste.

 

Your organization probably contains all kinds of contrasts too. Knowing your core and periphery can help sort out how to deploy the computing solutions you need to perform, however contrasted your performance might be.

 

And it’s alright.

smallHealey_border.jpgI was promised a smorgasbord of intellectual delights at IDEAS Boston 2012, and for the most part, the bill of fare didn’t disappoint. This day-long innovation conference was held at the University of Massachusetts Boston. On the agenda were over a dozen creative people from entirely diverse business sectors united by one goal: to innovate. Here are the top five inspirational stories:

 

  1. “Everything that rises must converge.” Wesley Morris is a Pulitzer Prize-winning film critic for The Boston Globe. In 15 minutes, he managed to link the Fast & Furious movie franchise to Barak Obama, NBA uniforms, and writer Flannery O’Connor. His point was that how we handle race relations in the United Sates is fundamentally changing. Different cultures have melded to yield a new conversation, beyond race-based dialogues. Best line: “Barack Obama has put black American culture on its best behavior.”
  2. “The media gets it wrong.” Journalist Linda Killian wrote a book about the undecided voter and who they really are. She’s found that the largely unaffiliated “Facebook Generation,” meaning people under 35, are more likely to register as independent, with some leaning towards the social libertarianism of Ron Paul. Best line: “Youth aren’t sold on the democrats’ social service approach but they don’t like the Republican’s social messages either.”
  3. “Winners don’t punish.” According to social emotions researcher David DeSteno, science proves we are more compassionate of others when we can see commonalities to ourselves in the victims. Best line: “We can build a sustainable society one act of cascading compassion at a time.”
  4. “Driven to fly.” Never mind that folks have been trying to build a flying car since 1916. Carl Dietrich, pilot, inventor, and entrepreneur, is determined to change all that. His prototype flying car named Terrafugia promises faster, easier travel from highway to airport. Best line: “We haven’t reached the Jetson’s yet, but soon.”
  5. “Supply chains are the biggest social networks on the planet.” Supply chain transparency advocate Leonardo Bonanni thinks everyone has an obligation to know where the products we use come from so we can insist on efficiencies that ultimately increase competitiveness, create jobs and reduce the carbon footprint. Best line: “Your iPhone has had a much more interesting life than you.”

 

Innovation is about looking differently at something, and finding inspiration where it’s least expected. In many ways, there’s nothing rational about it. Failure is pretty much an accepted fact of life for anyone serious about innovation. It takes a lot of faith to go against conventional wisdom, and insist on charging ahead despite a trail of failures. Innovators in technology, science, and culture may be the ultimate gamblers. Unlike Las Vegas, though, when their bets pay off, everybody has a much better chance of winning.

peeps.pngThomas Friedman wrote in his book, ‘The world is Flat’ that the world as we know it is becoming more connected as the barriers of trade and politics are being lowered. Through technology we are able to do business instantaneously with billions of people. In today’s complex global economic environment, enterprises face unique challenges in value creation and increasing productivity. The focus on costs has become an increasingly important aspect of any business. A competitive edge is created by delivering products or services more efficiently. This indispensible edge will enable enterprises to grow and prosper.

 

Technology plays a crucial role to reduce costs, however also comes with serious challenges in realizing anticipated value and benefits. Without a clear focus on value, the technology is likely to produce suboptimal results, while tactical delivery challenges become the priority. This blog post describes how enterprises can uncover value potential by benchmarking their productivity against others.

    

Management by Objectives

So what do leading companies do well to drive optimal value from technology? A recent study by AMR has shown that companies that adopt the discipline of value management, deliver over 1.6x higher business benefits from technology initiatives than companies that don’t. They take conscious effort to define crystal clear goals that drive adoption by the organization. Management guru Peter F. Drucker coined the term ‘management by objectives’ (MBO), which in essence is an approach to enhancing organizational effectiveness that is based on goals. Besides motivating workers, MBO creates an environment in which the performance of all employees can be evaluated on the basis of results rather than on personality or perceived effectiveness.

    

Over and over again enterprises set themselves the ‘wrong’ targets. Some set them self-up for failure by not being ambitious enough. They mobilize their company to finally realize that they didn’t make a difference in the market, which is both a waste of effort and frustrating for all employees involved. Some other companies set them self-up for failure by being too ambitious either in result or time. The price companies pay in this scenario is a lack of motivation at middle management, those who need to execute the change, and frustration at the top. In short, both scenario’s will reap suboptimal results. Benchmarking is the ultimate way to set relevant targets.

 

Target Setting Based On Business Performance Benchmarking

Benchmarking is the process of comparing one's business processes and performance metrics to industry bests or best practices from other industries. The purpose of this exercise is to quickly uncover what things an enterprise needs to do out of many possibilities to improve productivity. And to which level they need to improve. In other words, benchmarking gives executives the answer to the question “What initiatives can I start that will give me the biggest bang for my buck?”. Benchmarking was named by research executed by Bain and Company as one of the most valuable disciplines a company can undertake to improve productivity.

    

These are considered the key success factors in a benchmarking study: 

  1. Link targets to business goals. Targets on productivity improvement initiatives need to be linked to business goals. Therefore they need to go beyond the role of technology alone. It should cover the process and human aspects as well. Only with a well-orchestrated combination of people, process and technology, real innovation can be realized.
  2. Clear operational definition of KPIs. The operational definition of performance indicators and their targets needs to be very clearly spelled out. If not, an enterprise may not drive the desired behavior. It may also negatively impact the adoption rate, as employees question the benchmark results.
  3. Wise choice of peer group. The adoption of revised targets from benchmarking stand or fall by the definition of the peer group and the believe of the organization that they are comparing themselves to a peer group that they want to outperform in the war for customers.
  4. Tie targets to best practices. Targets set based on benchmarking are only one side of the coin. The other side is having the understanding of best practices that can enable the company to achieve the targets. The combination will drive adoption and likeliness to succeed. 
  5. Close collaboration between the assessor and the assessed enterprise. Only then recommendations will hold enough basis to get appropriate follow-up. To drive better results from the study, the benchmarking should be substantiated by interviews with executives and employees to understand the enterprise strategy and future aspirations.
  6. An encompassing report. A best in class benchmark reports cover at least the following topics:
    • Detailed and confidential comparison of a company’s performance to that of its peers
    • Key observations and opportunity areas, based on interviews and best practices
    • Recommendations in the form of a roadmap
    • Benefits analysis and high level ROI

 

Armed with hard evidence from such benchmark studies to support decision making, executives can adopt best practices not only to close performance gaps with competitors, but to beat their own business performance objectives.

 

Benchmark Your Organization Now!

To support your quest to become more competitive, SAP offers complimentary benchmark services. If you decide to participate in the survey you will receive an individual benchmark report in line with the best practice described above and a much better understanding of how well they are performing against peers from the same industry or even across industries. The survey results are kept private and confidential. SAP Benchmarking adheres to the ASUG and SAP Benchmarking Code of Conduct to advance the professionalism and effectiveness of benchmarking.

    

Please follow this link to register with your company email

https://valuemanagement.sap.com/

 

Once registered please contact me at koert.breebaart@sap.com to start your benchmarking survey.

273040_l_srgb_s_gl.jpgWhen a small business gets its first big order it can seem like manna from heaven. But wipe those dollar signs out of your eyes because it’s really more like a shock to the system.

 

That’s not necessarily a bad thing—we’re at our most alert and energized during such moments—but for small businesses, getting a big order from a giant company like Walmart can be a classic be-careful-what-you-wish-for moment.

 

“When you get that big order, it’s often a mandate for change, because even if by nature the management team is conservative and risk adverse, it knows it has to make changes to satisfy that customer,” Mark Lehew, SAP’s national VP of strategic growth enterprises, told me and journalist Rob O’Regan recently.

 

In interviews with companies that have experienced the Walmart Effect, Rob is indeed finding that change—rather than champagne—is the order of the day. Orabrush, maker of an innovative tongue-cleaning device was not prepared when Walmart suddenly called in 2011 with an order for 735,000 of the candy-colored devices to be distributed in 3,500 stores.

 

“That was one of the big wake-up calls for me,” says Jeff Davis, an early Orabrush investor who became CEO in August 2010. “I was worried that we didn’t have sufficient capability.”

 

How do you deal with such a situation? Here are four best practices that have emerged from our research so far for dealing with that first big order:

 

  • Start with on-time delivery and work backwards from there. If that first big customer doesn’t get what it’s looking for, word spreads quickly and the chances of another big order—from them or anyone like them—is unlikely. That means prioritizing the responses necessary to scale up and hit the date, says Lehew.

 

  • Get help from specialists. To supplement its own warehouse capacity, Orabrush entered into an agreement with UPS Global Logistics to supply some of the Walmart stores. “UPS was a critical partner for us because they helped us to ensure that we could deliver to Walmart the way Walmart wanted it,” he says.

 

  • Be open to a change in the business model. “For us, Walmart’s order was a big a-ha moment,” says Marty Metro, founder and CEO of UsedCardboardBoxes.com. In 2009, Metro’s startup was three years into its plan to sell used cardboard boxes to individuals and local businesses. But when Metro got the call from Walmart one afternoon (100,000 boxes by the end of the week, with more needed in the following two weeks), Metro re-jiggered the business model to include building a B2B marketplace that supports delivering tractor trailers full of boxes, not just small lots to individuals and small customers via the company’s existing e-commerce site.

 

  • Don’t be blinded by scale. UsedCardboardBoxes.com’s B2B business has taken off—with orders now averaging $7,000—but Metro learned an important lesson about what can happen when the big boys come knocking: not all of them will be profit centers. “We found out that it’s very difficult to make money selling to Walmart,” he says. “We realized that Walmart is so huge that you have to be careful. If you don’t want to sell at the price they want they can always find someone else who will.”

 

What do you think? How did your company deal with its first big order?

Three in five financial institutions cannot perform real-time reconciliation because they haven’t started working on it for any of their asset classes, according to a recent survey. And they don’t think they’ll be ready to start work on this regulation-essential project before the end of next year, stated the survey by London-based software solutions provider Gresham Computing.

 

Ready for Real-Time 11-05-2012Impending regulatory regimes, such as the Dodd-Frank Act and Basel III, could soon require different systems to adopt new reconciliation requirements, assuring that proper collateral amounts get delivered. But almost half of the survey respondents in New York and London indicated that they expect delays to inter-system reconciliation.

 

The Price of a Watchful Eye

 

Real-time market surveillance may not be moving so slowly. It is increasingly significant to market participants, according to Alexander Tabb of TABB Group, especially if the capital markets adopt solutions from the likes of NICE Systems’ acquisition of Redkite Financial Markets.

 

“Redkite’s nuanced approach has been to focus on the front-office behavior and let the technology follow suit,” Tabb wrote in a blog post. “The challenge, of course, is that front-office behaviors are constantly changing; thus, you need to have some deep pockets to make sure your technology evolves appropriately.”

 

Simultaneously mapping many of the market’s behavior types, as opposed to only a few, is extraordinarily challenging, Tabb noted. It entails teaching machines to think and react like rational traders, which is a costly endeavor.

 

“As with any dynamic system, activities are constantly changing -- methodologies evolve, and what was new yesterday is old today, and nobody knows what new types of activities will be enabled tomorrow,” Tabb said. “NICE ... will need to follow up its investment in the Redkite product with sustained development and backing.”

 

Future Sticker Shock

 

NICE and its customers will need the discipline to keep up with evolving behaviors and technology, which may be trickier than it sounds when future technology needs are on the line. Shortsighted budgeting is one of 10 data center mistakes businesses are making, according to TechRepublic’s Jack Wallen.

 

When you budget, make sure to have an idea of what your needs will be in the next five or 10 years,” Wallen said. “Always assume you will grow, and go with projected numbers, not current numbers.

 

Driving innovation and performance into the future via real-time data platforms will be the subject of a Webcast on Tuesday hosted by SAP’s Neil McGovern and IDC’s Carl Olofson. “Leveraging Integrated Data Platforms in Financial Services” will also discuss how organizations are already making the most of decision cycles and customer insights with real-time business intelligence solutions powered by in-memory technology.

 

The Road to Real-Time

 

Firms can dream up all kinds of reasons not to invest in real-time reconciliation, market surveillance or data platforms. But any excuse pales in comparison to the pain associated with running afoul of the law or falling hopelessly behind the competition.

 

These are necessary costs of the participating in the capital markets. And they are investments in regulatory compliance, as well as gaining a competitive edge against rivals.

 

Catching up -- if you can do it -- will only be more expensive down the road.

 

Related Articles:

 

Dealing firms not ready for real-time reconciliation - survey” by Richard Henderson

 

Real-Time Market Surveillance in Play” by Alexander Tabb

 

10 mistakes you might be making with your data center” by Jack Wallen

The U.S presidential election is imminent and, not surprisingly, politics are dominating everyone’s conversations.  Last week a work colleague and I had an on-going discussion of whether brands have political connotations.

 

We started with an observation about cars in the office parking lot: more Republicans own BMW’s while more Democrats own Jeeps. Cars turned into sports: Democrats prefer football while Republicans prefer baseball. We tried to find a pattern with fast food restaurants but couldn’t.

 

My colleague then speculated that logo color might reveal something about political leanings.  Coca-Cola, Verizon, and Oracle would all be considered Republican while Pepsi, AT&T, and SAP would be Democratic.  Chick-fil-A’s red logo seems to be consistent with their recent political controversy.

 

While it’s an intriguing notion, the theory didn’t stand up to a little on-line sleuthing. The neuro-insight research firm Buyology studied consumers’ non-conscious connections to brands and discovered variations by political affiliation:

 


DemocratsRepublicans
Most Desired CarJeepBMW
Most Desired ElectronicsSonySharp
Most Desired InsuranceProgressiveAllstate
Most Desired RestaurantWendy’sSubway
Most Desired Coffee ShopStarbucksDunkin’ Donuts

 

Allstate’s blue logo disproves our theory but at least we got the cars correct.

 

It turns out trying to associate brands with political preferences is a popular topic. According to consumer research firm YouGov, which ranked 1,100+ brands for quality, value, and willingness to recommend, the top brands for each political party are as follows:

 

DemocratsRepublicans
GoogleFox News Channel
Amazon.comHistory Channel
CheeriosCraftsman
CloroxChick-fil-A
DawnJohnson & Johnson

 

The results seem to imply Republicans watch more TV while Democrats spend more time on-line.

 

Even social media has joined in.  The digital agency Engage cross-referenced polling data with influence and Facebook “likes” to correlate food preference with politics. Their conclusion? “Conservatives like Cracker Barrel, while Red Bull leans left.”

 

Infographic by engage

 

I don’t know if any of this can be used to project the election winner but it’s good fun.

 

So readers, what do you think? Do your politics fit these brand preferences?

 

Follow me on twitter @jbecher.

 

This blog was originally posted on Manage By Walking Around.

On the Business Innovation site, we deliver the top blogs, news  and  featured content on business innovation for professionals looking to  grow and  gain a competitive advantage. We cover hot topics and thought  leadership on mobile applications, cloud computing, big data, real-time analytics and the top challenges facing executives and leaders in sales & marketing, finance, human resources and much, much more.

 

Each week, we curate and publish the top 10 posts of the week on  business  innovation from across our content categories. We hope you find these articles  valuable, informative, and interesting. Enjoy!

 

Top 60 #Sales and #Marketing Twitter Influencers

Sales & Marketing – By Jen Cohen Crompton, @jenz036

We are aimed at becoming an authority on business innovation and want to help you identify the top influencers so you can follow the latest trends, news and opinions of these influencers in the field of Sales and Marketing. Check out these top 60 influencers.

 

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It sounds like an ominous plot by some evil mastermind intent on world domination.  But don’t worry, “dark data is more benign than the name suggests.

 

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The power of mobile is "spooktacular". Hear Carolyn Fitton's suggestions on this years coolest mobile apps that will help your Halloween run smoothly.

 

“Stay Hungry, Stay Humble” Words of Wisdom from SAP Co-CEO Bill McDermott

Human Resources – By Lindsey Nelson, @LindseyNNelson

If you don't know SAP Co-CEO Bill McDermott, or ever had the opportunity to speak, he is one of the most animated story tellers ever, making this article pretty easy to write. Check it out and let me know what you think!

 

Consumers To Brands: Give Us Something And We’ll Like You On Facebook [Infographic]

Sales & Marketing – By Steve Olenski, @steveolenski

Give them what they want, something free, something discounted. Steve reflects on survey results from Lab42 that analyzed sentiments towards Facebook brand pages.

 

Practical Steps To Private Cloud Reality

Cloud – By Lindsey Nelson

If you haven't switched some of your business to the cloud for fear of the challenges, there's good news. This article gives you a few tips on how you can make your journey to the private cloud a successful one.

 

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Mobile – By Eric Lai, @ericylai

Eric Lai highlights the four major steps Apple is taking to accomodate their enterprise partners on their quest for moabile app management.

 

Big Data Job Alert: The Data Scientist

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7 Cloud Capabilities Clouding Executive Views

Cloud – By Daniel Newman, @danielnewmanUV

Today, it is more important than ever that business executives understand the cloud. Here are some quick points on cloud capabilities to lift the fog and bring some light to what the cloud can do for just about any organization.

Benchmark.jpg

 

Benchmarking is one management tool which captures and monitors an organization's performance. It also identifies performance improvement opportunities and pin points gaps in key areas. SAP Value Management Center, the benchmarking on-demand solution, is a FREE offering from SAP for all to measure, monitor and compare their performance with industry leaders.

 

I had a discussion on the capability of this free offering of SAP with Shailendra Sahay, Program Director of Value Engineering (VE) Best Practices Center and Global Benchmarking. His organization runs the SAP Benchmarking Program globally. The organization helps SAP customers assess their business process maturity and gap to industry best practices. He's given a similar interview to Silicon India, now here are a few salient points from our discussion.

 

 

1.) Business Performance Benchmarking is the first step to understand the health of an organization's business processes.


As per Shailendra, "As a trusted vendor to the customer, our objective has always been to solve our customer's real business issues. It is always important for us to first understand the customer's pain points, before offering an IT solution. And our benchmarking program is the perfect tool set to make this happen. Companies can choose to participate in one or more of our 20 plus business process assessments. At the end of the benchmarking exercise, they will get a customized report which will help them understand where they are doing good and the areas they need to improve. This also helps us understand the real pain points in our customer's business, and articulate an IT solution that will help them run better as an organization. "

 

The Benchmarking program has grown exponentially over the years. This has now transformed the way our customer's approach benchmarking. This program is available through the self-service VMC (Value Management Center) platform. The VMC platform has a database of more than 10,000 benchmarking survey submissions from 4,000 plus companies across 24 industries. It provides 20 plus business process assessments and 12 industry-specific business process assessments (e.g. demand planning for retail, asset management for utilities, etc).


Organizations can use the VMC to benchmark against one of the 300 plus available industry/process combinations (e.g. supply chain planning in retail industry). Customers and select prospects can register themselves on this platform, and choose the survey they want to take, and can get to see real time results after successfully completing the survey. This service is available absolutely free of cost and team of Value Engineers can help the customers interpret the results.

 

2.) Evolution of Benchmarking Practice over the years

 

The Benchmarking program was first launched in North America and then slowly expanded it to cover the rest of the world.With experience, the quality of the program improvement which in turn has resulted in robust benchmarking coverage across geographies and industries.  Shailendra sights an example where they realized that many companies in emerging and less mature financial markets were not tracking all the KPI's asked in the benchmarking surveys.

 

As per Shailendra, "It was a learning experience for both the parties, where these companies realized what they were missing by not tracking all KPIs that are critical to a successful business. We also learned on how we could make our surveys easier so as not too appear too overwhelming to companies which are still ramping up on the best practices curve. Often, we learn a lot of new trends from our customers. Lately, our customers have started to track a lot of new and innovative KPIs in order to keep pace with the changing business landscape. We keep updating our surveys to maintain their relevance to the current business reality. "

 

We ended our chat discussing the future roadmap and the vision of the offering. As per Shailendra, the vision would be to "go on and enable value management to be more effective and to reach a stage where it becomes a part of customers' DNA. We want to make it a self sustaining discipline which runs on its own because customers see value in it. "

 

The VMC functionality have been augmented with Business Case creation. More Services are in pipeline. I would strongly recommend that we pass on this good word around our community in our quest to make the world "run better". Please drop in your feedback and comments.


 


 

 


 




 



mcd.jpgI am very lucky to work at a company where I feel inspired every day. I am inspired by my colleagues, who despite the pressures of life, continue to produce incredible results across the board. I am inspired by my manager, and his manager, and my friends managers who are nothing like the terrible bosses I had pictured I would have. And last night, I was once again inspired by the co-CEO of my company Bill McDermott (pictured) as he spoke to a full auditorium of students, SAP colleagues, and adults at the Drexel Bossone Research Center with university president John Fry.

 

The fireside chat, hosted by interim dean of the Drexel LeBow College of Business, Frank Linnehan, kicked off with the SAP “Run Like Never Before” commercial. This, if you’ve never seen it, is an incredible 60 second, visual, that really captures the vision of SAP.

 

After the spot ended, Frank shared with the audience a brief overview of Drexel’s “A View from the Top” series in which great organizational leaders, ones who embody the ambition, vision and other empowering qualities, come to share their insights and experiences.

 

I’ve attended events like this before, and typically I walk away without any “aha” moments; however, after leaving last night I couldn’t help but feel truly moved. The topics of small businesses, globalization, and leadership, all paired with a humorous story from Bill McDermott, each had a key takeaway for not only the students, but also for the SAP and community members alike.

 

Small Business

 

Not everyone coming out of college will go on to work for a 65,000 employee company like SAP. They may enter a startup, or even go out on a limb to open their own business. Small businesses are typically cited as the bulls of the market. These SMB’s (small to mid-size businesses) are often credited with being innovative, agile, and transformative to the traditional ways of doing business.

 

Back in his hay day, Bill had the opportunity to open his own small business, a delicatessen. A banker gave him 5,500 in notes and $7,000 in interest.  To which he said, “that meant, you’re broke, but someone was nice enough to loan you some money.”

 

He correlated his experience to SAP now, and how his deli had the same mantra, “It was all about the customer then, it’s all about the customer today.” He had an understanding of his customer and he was always looking for ideas to make money.

 

One day when he was at the mall he saw tons of kids putting tons of quarters into the video game machines. He knew if he wanted to not only grow his business, but appeal to his teenage customer base, he had to accommodate and give them what they wanted.

 

He called up the video game company, and the sales rep let him know it was $5,000 for a machine. At the time he didn’t have the $5,000, so he cut a deal – “I told him I’ll build a room off the side of the deli, and I’ll split the quarters with you.” In 60 days, the quarters he split paid for the business.

 

The takeaways, “It’s the customer, it’s segmenting your markets, it’s being authentic around who you are and what you can do to win and service your customer better than anyone else, and it’s an idea. Everything happens when you change the status quo. If you look at all the breakthroughs that happen on an idea; it was one idea, accidental, and we acted on it and bam. It’s the same today…I’ll take you forward to SAP we have one idea. To put all the data in corporations in memory…it’s creating an entirely new industry…innovation is everywhere, but you have to constantly be looking for it.”

 

Globalization

 

These small businesses are everywhere, not only in the United States, but especially all over the world. When president Fry asked how Drexel students can prepare themselves for this landscape, Bill touched on the importance of becoming a worldly thinker in this global business structure. Countries like Brazil, where 65% of the businesses run SAP and 90% of those businesses are considered small, SAP is still a startup. There is still so much opportunity for growth, not only in capital, but also for graduates to go and learn and work.

 

“The global economy is there for you, this is an international game and you need to think that way. I think the language aspect is important…if I was doing it all over again I would go for languages, I would definitely spend my time getting a language or two under my belt.”

 

Getting that first killer job is so important, Bill suggested. He advised that students should go with people who are doing things and going places; find the industries that are growing such healthcare and retail. Technology is changing these fields, and according to Bill, “the winners that know how to deal with the consumer and completely digitize the end to end process” will be the most successful. But, students do their research about the topics they’re most interested in and the companies within those spaces. Researching your customer and the industries where you can innovate through your passion, will make you successful.

 

Leadership

 

This was the topic I was most looking forward too. It was incredible to hear from someone whom I consider a real leader, what he thinks comprises a comprehensive leader. Bill shared his experiences with the leaders he’s met; they’ve all got a few things in common:

  • They all have followers. These followers manage up; they’re phonies who manage up, bragging about themselves and what they’re doing. Ensure you are not just managing, but you’re with the people and you’re in the action.
  • “Do what you do well, and do it often”
  • Real leaders create an environment that encourages inspiration. They build talent diverse teams by hiring people who have skill sets that they don’t have.  A common mistake he sees is that leaders focus too much on the weaknesses of their team members and being in charge. As a leader you must find something great about every person, then find the greatness in others and put those people together to build a winning team. “We all have that magic…We tend to fight what we love. You’ve got to go with what you really believe in, what you really love, and it will all turn out okay. Leaders have to be in the zone where they find passion to lead.”

 

He warned, “Watch out for people who tell you can’t do something, or you’re not capable of something. Those are the very people you owe everything too, even your biggest bonus, because they’ve done you a huge favor by increasing the size of the chip on your shoulder.”

 

All in all

 

It was an unbelievable and inspirational night. After the fireside chat, I had the opportunity to network with not only my SAP colleagues, but students from all over the Philadelphia universities who traveled to hear Bill speak. A Drexel teaching assistant shared, “I come to these events all the time, and I am sorry to say I was ready to fall asleep, but I was blown away.  Not only was I not sleeping but I was on the edge of my seat, engaged the whole time!”

 

I myself felt similarly, as well as did Christine Donato, a member of SAP’s Services University for Learning, “It was engaging, motivating, and inspiring—the passion that Bill McDermott has for SAP filled the Drexel auditorium last night. He stressed the importance of young professionals to not only build their brand, but to live and breathe it every day. “What’s your vision?” he asked us, a question that will remain with me throughout my entire career.”

 

Quotable Moments:

  • “Stay hungry, and stay humble”
  • “In the end, it’s the customer and the customer alone that determines if we have a job”
  • “You need to constantly be innovating for the future, while you’re executing for the present…the best leaders understand that”
  • “The true measure of a person is what they gave, not what they took. If you’re really interested in your own soul…you’ve got to be a giver and not a taker”
  • “You need to be at peace with who you are and what you do and how you do it”
  • I’ve always believed the people who were nicest to the people who were least in a position to help them are the kind of people I want to be around, and that’s the kind of person I want to be. It’s always something you’ve got to work at”
  • “You need to be in balance…the thing you really need to do with your life is find that groove where you’re staying healthy mentally and physically…cool out the mind…sometimes you don’t need to look busy, sometimes you need to put your feet on the desk and look out the window and think about new ideas. It’s not about being busy, it’s about what you get done”
  • “Never forget home base…time flies fast, you want to make sure you’re punching the right tickets along the way”
  • “You always need to be looking around the corner for new ideas”
  • “You all can make a difference, the young generation coming out of the universities and coming into the workforce. You see things we don’t see, your ideas are unique, you’re totally digital, you understand where the world is going, you understand social. You get all that, and I think that’s such an unbelievable opportunity to help the economy, create innovation, create jobs, and push things forward”
  • When asked what question he’d ask an interviewee at SAP, “What’s your vision?”

 

This article originally appeared on Business Innovation from SAP.


global2.jpgSAP just spent $4.5 bn to buy Ariba. This seems to be quite a steep price tag just to enter the OnDemand enterprise application space for Procurement. But if you look closer you will realize that what SAP really bought is the world’s largest business network. And yes, I call it business network and not supplier network, anticipating that there is more.

 

The foundation is huge - SAP owns the biggest business network in the world now

 

I’ll start with the facts. So far, Ariba managed to get about 750,000 suppliers to sign up on their network. Why did they sign up? Because their main customers (referred to as “buyers”) are on the network  and these customers want to connect to their suppliers through this network in order to streamline and optimize procurement automation. They are mainly buying indirect materials like office supplies etc.

 

You may ask why is this is even critical? Isn’t it far from a core process? Yes, however we need to put it in perspective as this adds up to currently more
than $350bn in commerce that is transacted over the network. And once a company manages their indirect spend over the network it is not a far stretch to go
after their direct spend as well - and Ariba has taped into this space already. Also, it’s important to note, companies like Walmart spend billions of dollars on indirect materials – this represents massive cost saving potential for those large corporations already.

 

Ariba has started to monetize on the network effect. Signing up as a supplier is free; transacting is free as well, until a certain volume is reached. Above this threshold, Ariba charges a small percentage of the spend volume – far less than the 2-3% that credit companies are commanding.

 

The Network has to deliver mutual benefits for all participants

 

Once a network has reached a critical mass, all types of service can be established and sold at additional cost. For example, Dynamic Invoice Discounting which helps suppliers cash in earlier, Discovery Services that help suppliers find new business that they otherwise wouldn’t know about. The network is creating value for suppliers following the conviction that a network can only be sustainable and grow when it offers mutual benefit for all participants. Ariba enables companies to join the networked economy.

 

Business Networks in almost every Industry

 

So what’s next? I said at the beginning of this blog that we are talking about a business network and not a supplier network. A business network could be defined as an extended, open value chain (across-LoB and across-industries) of interconnected business entities, systems and related people. Starting in the procurement and adjacent finance domains it is not a far stretch to enter the supply chain management domain by managing direct material spend, or the supplier collaboration, inventory visibility and management, transportation management, or collaboration with logistics partners (3PL’s).

More than 60% of the world’s transactions touch an SAP backend system at some point; now we are in a position to extend the business process excellence that SAP stands for beyond the four walls of an enterprise. Throwing in SAP’s deep industry expertise, we can start carving our industry specific use cases such as banking services, trade platforms, compliance engines etc. Finally, by combining this with SAP’s world class business intelligence capabilities, a
myriad of services that could be offered on top of the network are possible by leveraging the data that is flowing there and making sense out of it.

 

The business network market is a “winner-takes-all” market and with the right execution SAP can be the winner leaving the market thinking that those were         $4.5bn well spent after all.

 

What areas would you like to hear about going forward?

 

Please share your opinions on how SAP can establish thought leadership in business networks and take this to the next level.

Last week I had an epiphany while attending the SAP Financial Services Forum in New York City: I no longer hate those 40-year-old mainframe legacy systems that for years I regularly dismissed as old and uncommunicative.

 

I realized it’s not the legacy systems I hate. They are actually marvels of engineering. No, it’s what has built up around them that I hate. Companies and IT departments have spent decades layering complex add-ons around those heroic cores until system architectures started looking like hairballs.

 

Time to Hock up the Complexity

And now the banking industry is collectively starting to do that rhythmic retching that cats do before they hock one up. PayPal is stealing their bread-and-butter transaction business, bank branches get as much traffic as the school vending machines that dispense broccoli, and regulators are getting ready to feast on Dodd-Frank’s 900-page carcass.

 

Banks are going to have to get rid of that complexity. Things have finally gotten to the point where they can’t keep slathering more stuff on. Want to know what removing all that complexity does for you? It lets you release a mobile banking app in two months—at least that’s what Don Good and the rest of the IT team at Canadian bank ATB Financial did, as Don noted in his presentation at the conference.

 

Reward for Removing Complexity

Another idea: Instead of only rewarding IT and business people for adding more processes and functionality, reward them for removing complexity. Better yet, incent them to do both at once.

Banks better start doing it now, because customers are pushing for things—like online and offline channel integration and free mobile banking—that drive up complexity rather than reducing it. Meanwhile, internal management is looking for more and better management tools, including real-time analysis, which will also complicate IT. The systems are going to need to get simpler and more agile to keep from umm, breaking the bank.

Here are some other things I learned last week that seemed wise and/or surprising:

  • To innovate in financial services, where do you begin? Benchmark existing processes. CFOs want a consolidated view across risk, treasury, and finance--that's what gives business insight.
  • Real-time risk updates matter: An insurance company lost $1.6 billion in trading in 12 minutes in 2011.
  • Marketing will soon have a bigger IT budget than IT spends on its own department according to Gartner
  • Spending on risk and regulatory has been a #1 priority for banking IT for some time, according to research Kathy Burger of Bank Systems and Technology, but now analytics, BI, modeling, and information management are at the top.

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