Here are a couple of notes from the Intuit Enterprise Ecosystem Summit where I presented the SAP Ecosystem and the SAP EcoHub.
My comments in 
Companies presenting: Intuit, eBay, Adobe, Autodesk, Rubicon Consulting, and SAP.
Michael Mace Rubicon who worked for Apple and Palm years ago presented platforms that failed and why. Turns out most do. It is painful to read the list: Amiga, Dr Dos, Commodore, NEXT, Be, Taligent, OS/2, Newton, Windows Pocket PC, Java micro division (broken), UIQ on top of Symbian, Palm, Facebook.
It actually depends on what you define as application success. If Facebook’s goal was to get a lot of marketing buzz and get ahead of MySpace, then Facebook platform is a success. The developers are not making money on it, from that perspective it is a failure. [The caravan moved on to the iPhone platform with clear monetization, even though price pressure is enormous. The hope was a price point of $10, the going rate is unfortunately $1]
What is motivating to Developers: Coolness and Money [We as SAP developers are mostly on the money side 😉 Although I think it is a matter of perspective. To have built a poi pond for the iPhone is cool and funny for about 2 minutes. On the other hand it is endlessly rewarding to be part of a team that masters the complexity of business processes that actually run successful companies like eBay, Adobe, Autodesk, just to name a few that run SAP software and presented today.]
How do platforms fail:
- Java for mobile: Inconsistent API, the promise of develop once and run many didn’t materialize, no scaling possible
- Palm and Windows Mobile: Apps really hard to find [We had that problem too, is now solved through our EcoHub]
- Store financials outrageous, some platforms took up to 50% cut. Sensible mark is 20%. Apple is charging 30% on iPhone applications.
- Facebook: Almost impossible to monetize. [Especially now that the ad dollars are shrinking.]
- PC platform in decline: Microsoft preying on successful app vendors and squeezing them out, developers think twice about developing for that platform.
How to platforms win:
- The less friction the more applications get developed. Therefore:
- Powerful API
- Good support
- Uses existing tools
- Easy to sell
- Large user base (Or the belief that it’ll get large.)
- Easy installation
- Make it easy to bill
- Reduce the revenue cut to 20%
- Eliminate prior review process of aplications. Risk of development time spent and rejected once it is finished.
[In an enterprise environment, our customers need the SAP stamp of approval aka: certification. They can’t afford their processes to stand still because of untested software]
- Enable background processing (currently a problem on the iPhone)
- Enable third party platforms
- Java, Flash, etc. [He doesn’t understand why Apple is not enabling Java, they would still get 30% of the apps revenue.]
- Enable Web application
The ultimate ecosystem
- Integrated platform
- Web app development
- Lots of Ajax-style tools, instant deployment, huge user base, write once run anywhere
Ultimate question for developers is:
- Which platform gives me the best long term business proposition
- Strong bias toward Ajax-style development:
- Ability to create mashups
- Very fast
- Turn code every day versus 18 months
[We have some work to do on this one]
Alex Chriss Intuit Partner Platform
The most interesting platform for me was Intuit’s. They call it Platform as a Service (PaaS)
They are hosting the tools for you to build & sell engaging and powerful Rich Internet Applications (RIAs) without the hassle of building your own server, database, and billing infrastructure. Here is the step by step guide to get you started.
They are featuring Dwyer Technologies, that used to do QuickBooks applications, was new to Flex technology and was able to churn out a solution within 6 weeks.
[When I talked to Jan from Intuit voicing my concern about having all this data online, he said that they are surprised about the adoption of their online tools like QuickBooks online. Therefore there is a large and growing market for Intuit’s PaaS solutions. The combination of lowering the barrier of entry by providing a developer platform and the guarantee of a large audience is a very powerful one.]
Bryant Macy first:
- Consumerization of the enterprise is happening: Consumers demanding web like functionality/usability in their enterprise applications
- Flex is a fast start as seen earlier used within the Intuit Partner Platform
80% of all videos currently done via flash
Air for flash applications outside of the browser
Ecosystems [They also have the broader view on the Ecosystem as SAP has]
- Adobe Labs
- Developer Connection
Open Screen Project http://www.openscreenproject.org/
The Open Screen Project is an industry-wide initiative, led by Adobe with the participation of industry leaders, with one clear vision: enable consumers to engage with rich Internet experiences seamlessly across any device, anywhere.
With lots of partners on board: BBC, Cisco, Verizon, Nokia, Comcast, Intel, Sony Ericson, …
GenesysZen (Matthias Zeller)
Community and Ecosystem built into the design of the product from the beginning.
[That is how it should be done. We should use this model within SAP more foten]
Persistent Personal Portal. Target large enterprises.
Goal: How can we make it easier for Business Users to interact with the Enterprise.
Catalog of tools and widgets that can be draged and droped over to the workspace
Amar Hanspal Autodesk
Developer Ecosystem journey
- 3279 Independent Autodesk companies
- 400 are customers too
- Creating 2500 applications
- Employ about 13,000 developers
The most important asset for a developer is providing a market. Having the customers.
[SAP has that covered, although we could be better in enabling our partners and developers to get access to these excellent customer base. This is where the SAP EcoHub comes in. 😉 ]
Everything else is secondary. This is why they get away with Lisp being their programming language. [And we get away with ABAP as a programming language 😉 ]
- Autodesk Revit they opened it up after 6 years of being closed: Because they have a large enough user base now.
- Opportunity for developers is growing
- More developers from emerging markets: India, China, Russia, Brazil, …
- AutoCAD still about 70% of revenues, but doing a good job in diversifying.
- ISVs the Wipros of the world are interested in creating apps for larger companies that they can get service revenue year after year from => Going into the area of SAP from a business model perspective.
Having heard these presentations and having a day to reflect, here are my comments to the current SAP Ecosystem. I posted my slides.
Little side story: How it come to be, that I presented at this event? It is good to have connections, I talked to SAP Mentor Matthias Zeller before Christmas regarding the SAP Camp in Palo Alto this spring. At the end he mentioned, did you hear about the Intuit Ecosystem Summit, looks interesting and Amit Sinha from SAP is presenting. So I asked Amit whether I could come too to observe the event. He said sure, by the way I wanted to present Business Network Transformation (BNT) including the SAP Ecosystem. You are from the Ecosystem, can you present that part? The day before the event his kid got really sick, so he couldn’t even present the BNT part, that is why I took that over too. He send me excellent notes, that I mostly ignored 😉 but share further down.
Our SAP Partner Network is really enormous in comparison. Estimates are that worldwide SAP has over 15.000 partners. These are hardware, implementation, channel, service providers, software solution partners, hosting partners, …
Here are Amit’s notes.
Slide 1: The boundaries of how an organization delivers value to customers and achieves profitable growth are being redefined. As internal opportunities to drive profitable growth are already extracted, line of business who are responsible for P&L are expanding their horizon to business networks to deliver not only cost savings (leveraging business network’s assets thereby reducing capital deployed, managing global demand and supply with efficiency) but also higher revenue (through better customer satisfaction and faster rate of product co-innovation).
Company Centric vs Customer Centric: Customer feedback travels slowly in linear value chains – where each entity optimizes to the adjacent player in the value chain – making it slow to change. On the other hand in business networks – customers are the focal point – feedback travels faster – more often through new technologies and communities – companies hustle to bring higher customer value – anticipating requirements and altering company and industry boundaries to achieve it. As an example – in the automotive industry – cars have become high tech devices – including navigation, in car entertainment, communication and now battery and alternate energy technologies to bring more customer value. Technology companies in the network of the automotive manufacturers have to focus on changing end consumer preferences in addition to the needs of the automotive partners. Its no longer a tiered linear value chain – its more of a network – where business network partners are collaboration to create NEW VALUE. Similarly in healthcare or media, by focusing on end customer, be it patients or content consumers, business network partners can provide better care (e.g. insurance with healthcare) or access (e.g. via telco or online providers) to content.
Command and Control vs. Connect and Collaborate: As relationships become more strategic on a global level, companies have to build new skills and culture to collaborate with their partners. Traditionally companies have operated in a command and control fashion, specially when they have held “concentrator” power in their value chain. Command and Control works when opportunities are mature, in traditional value chains for example, where each participant knows their place in the value chain. However when new opportunities emerge, “Command and Control” style of functioning is very weak as they cannot collaborate to develop new markets – they dictate terms. In fast paced global markets where there are more opportunities for development – business networks require a culture of connecting and collaborating with suppliers, partners, alliances and customers. With technology, advanced communications such as telepresence, collaboration in online communities we have the capabilities to do this more easily. As an example – P&G opened its product innovation to its network and today drives more than 50% revenue from new products developed by its business network partners – accelerating time to market and category leaders (note to speaker – google connect+develop before the meeting)
Ownership vs. Relationship: Companies have traditionally competed by building all the assets needed to deliver customer value – factories, owned logistics, owned design. To enter an industry value chain, you had to invest in owning assets however, as companies become asset heavy – the flexibility to adapt and innovate quickly reduces -making companies less competitive than their peers who specialize on their core strength and leverage “relationships” to complete the customer solutions. Companies in multiple industries – from media, defense, automotive, computer industry started leveraging relationships instead of owning all the assets themselves driving higher return on their investments. Microsoft’s dominance on the operating system layer is largely due to their ability to orchestrate a “lockstep relationship” with chip manufacturers like Intel, computer makers like HP and a number of application providers including SAP for instance.
Self Contained risk vs Shared risk: Tighter access to finance implies companies will focus on their core to drive up margins and leverage external partner capabilities and assets, thereby, further disaggregating the value chain. How do you measure risk and manage performance when so many of business processes are outside your company? Companies must now optimize risk and performance at the business network level for profitable growth.
- Loosely-connected organizations in which each sharpens its defensible differentiator and relies on its partners, suppliers, and customers for the rest.
- Enables organization to deliver faster innovation to customers at lower costs by sharing investments, assets, and ideas.
- New market opportunities are unlocked by combining the products and services of the business network participants in creative ways and leveraging each other’s market access and infrastructure.
- Risk gets shared, with the right KPIs and visibility this higher risk can be better managed for higher performance.
- My comments were around that even the value chain of yesterday was customer centric, but they first had to lay the foundation of integrated business processes within their own companies.
I told the example of Krueger, where the sales and productions managers used to yell at each other every morning because they didn’t have transparencies throughout the company. Once they had implemented SAP, they had coffee every so often together to look over the pipeline and production plan.
Now business networks are strengthened and driven by the new collaboration capabilities some call them Web 2.0. We created the SAP Community Network 5 years ago with the SAP Developer Network and now have over 1.5 million members. We work hard on creating trust and passion within our communities and our Netpromoter score of 72 shows that we are on the right track.
For me an extreme example, that shows where these business network transformations are going is ESME the Enterprise Short Message Experiment. ESMEstarted as an SAP Mentor community project, largely as a result of a conversation in Plurk while Twitter was down.
ESME is more advanced than Twitter since it features user groups and tag clouds, enabling project based contextual messaging as well as events coming from an enterprise system. As is can be deployed behind the firewall, it can access LDAP distribution lists for automatic group forming.
The ESME team only formed because of the strong trust relationships that were built on SCN. Most of the team members were top contributors to the SAP Network or even SAP Mentor Initiative.
I am convinced, that the boundaries between software providers, it’s partners and customers are blurring. The ESME team is from within SAP, but mostly customers and partners from all over the world.
I added the ESME slide to the deck to show 4 team members: Dennis Howlett Spain. Richard Hirsch Austria, … , Darren Hague Great Britain . They met for the first time at TechEd in Berlin.
We are going towards a project model that resembles the Hollywood model of making movies. A team is put together for every movie based on the reputation gathered from the previous job
Slide 3 Amit’s excellent notes:
Key question: what types of networks are evolving and how are they correlated with Business Model Innovation?
Two types of business models correspond to two types of business networks
Complex systems: Innovate quickly (BASF).
Relationship oriented, situational processes.
Focus on insight, collaboration (= connecting people) and sharing information expertise,.
relationship oriented, situational processes.
Building business-user centric collaborative networks with a trusted orchestrator. Sharing information.
Oil & Gas Example of Collaborative Network: An Oil & Gas company needs to partner with other O&G companies, government agencies, oil field service providers, and technology providers to solve the complex problem of finding oil & gas reserves, designing, constructing, and commissioning an oil platform in the deep waters of the Arctic, which requires a collaborative approach to sophisticated engineering, geophysics, and business models. Important since a key strategic imperative for Chevron is to find more oil
Volume operations: scale up quickly
Transaction-oriented, standardized business processes.
Focus on efficiency, automation (= connecting systems) and speed sharing processes, transaction-oriented, standardized business processes.
Building business process-centric coordinated networks with usually a strong guy in the middle (the concentrator).
Oil & Gas Example of Coordinated Network: After the oil & gas has been extracted from the field, the oil & gas companies need to coordinate with their various partners (e.g., transportation providers) to produce, refine, and deliver a high volume of oil & gas to the customers/consumers in the most efficient way. Important since a key strategic imperative is to improve operational efficiency and asset reliance
Slide 9 shows again how big the SAP Ecosystem already is. Not only do we have 1.5 million members in the SAP Community Network, but there are these different communities included in it. For example the Business Process Expert (BPX) community. It is unique in the industry. These are the people in thecompany that are looking at end to end processes and how to improve them. Tools are developed by SAP to make it possible for these BPXers to model their processes and that reflexts what really is going on in the system. Any changes or additions to the model are after test automatically reflected in their underlying production system. In an ideal case without toughing code.
Even without that technology within large corporations, these are the folks that create the specs for the developer to fill, which makes them enormously important.
We have also large User Groups in 31 countries, that just created a world wide organization SUGENthe SAP User Group Executive Network.
Slide 5 takes a look at the SAP Ecosystem from a Chemical Industry perspective. On the right it shows all the communities and activities relevant for that Industry in the different areas.
On the left we have the solution map, that shows typical chemical processes and the relevant solution accordingly. It also points out the many third party solutions that are offered for the different chemical company business processes.
Our customers had a big problem to get a good overview of these solutions until about 3 months ago when we introduced the SAP EcoHub. the trusted online solution marketplace that provides the intelligence for customers to Discover, Evaluate, and Buy industry-relevant partner solutions. These solutions are certified by SAP. This certification is really important for our customers, as a production standstill wants to be avoided.
Through the SAP EcoHub customers or even prospects, no matter where they are can find an SAP or partner solution. Your solution has to be certified and the EcoHub gives you a step by step description on how to get there in the Getting Started section.
I like that you can see on the home page the most viewed solutions as well newly added ones.
As I said we opened our gates about three months ago and now have more than 100 partners offering about 200 solutions with many more in the pipeline.
SCN members can rate and comment on the different solutions. Prospects can request a demo, or to be contacted.
MegaXML an EDI integration solution offered by the Task Performance Group in Des Plains Illinois saw a large increase in inquiries since having their solution on the EcoHub.
Adobe is offering two solutions too: Interactive Forms and Adobe Connect.
I think there are opportunities for the other presenting companies as well:
- Autodesk integration of the CAT drawings into production process.
- Enabling companies to get rid of their overstock inventory by automatically creating eBay listings out of the SAP Inventory management.
- Joe the Plummer that was the example for many of the Intuit presentations. Should get hooked into a marketplace for his pipe needs.
If you can’t do it yourself, because your development pipeline is full, you may want to go down the road and create a challenge on InnoCentiveSAP’s innovation marketplace for someone else to fill the gap.
We have come a long way, but if one looks at the opportunities, we all are just at the beginning of and the possibilities are enormous.