One of my research and publishing goals for the year is to develop a clearer understanding of the skills and opportunities created by Business ByDesign (ByD) and SaaS consulting in general. What makes this area especially potent is that it’s clear that the classic “big ERP” consulting model and skill set is not going to be a fit in the ByD world. Whatever opportunities present themselves will not necessarily be easy to pursue, even for well-established SAP folks.
With that in mind, I was glad to connect at SAPPHIRENOW with someone who I consider to be an emerging voice in the ByD/SaaS skills conversation: Ray Tetlow of Skyytek. Ray spoke as an early ByD partner at SAPPHIRENOW Orlando. At SAPPHIRENOW, I found that Ray’s ideas about the skills requirements for ByD professionals were much better fleshed out than most. Likely this was because of his firm’s experience as a SaaS reseller and implementor with more than 1,000 SaaS installs under their belts. All told this made Ray an ideal guest for this special edition of the ERP Lounge podcast series. With fourth of July behind us, I thought this was an ideal time to share this podcast with SCN and to include some additional notes.
Obviously, there are more questions about ByDesign right now than you could possibly cover in one podcast. But during this forty-seven minute podcast, we did cover a lot of ground, including:
– how Ray intends to train ByD professionals,
– why SaaS consultants are easier to bring up to speed in ByD than “on-premise” SAP consultants
– The appeals and drawbacks of the SaaS consulting model.
As usual with my SCN podcast posts, there are several listening/download options, and you can scroll down to see a time stap summary with some podcast notes to get quickly to the part you want. Comments welcome.
(If for any reason the embedded player doesn’t work, you can download the podcast using the “download media” link on the right hand side).
(Trouble downloading? if for some reason it’s not playing in its entirety for you, check out the version on JonERP.com in the meantime.)
Podcast Timeframe and Highlights
1:03 SAPPHIRENOW Orlando 2010 – Ray’s reactions to his first SAP show. Another Oracle show veteran reports that the SAP food was better!
1:45 What has Ray been up to since the show: talking to SAP about go-to-market for ByDesign and preparing for to resell and implement ByD 3.5 starting in August.
2:24 What are the SaaS consulting opportunities that some on-premise firms can’t make sense of? There are two aspects: licensing and consulting. The consulting economics can be excellent, but it’s a volume environment. Compared to Business One, ByDesign is a faster sales cycle so you have to be prepared for that. The rates can be very good if you are structured to capitalize on these projects.
4:14 What drew Skyytek to ByDesign?
6:22 Why are on-premise ERP consulting firms going to struggle with the SaaS consulting transition? Ray: using the on-premise deployment model is not effective for SaaS. Pre-sales and post-sales efforts on the client site are not affordable. There’s no technical aspects to SaaS deployments, and on the functional side, it’s not a configuration exercise either, so the consultants you need are very different. You don’t have a consultant on site for 3-4 months on a solution – you have 6 or 7 consultants for a much shorter period of time, working on multiple projects – a “many to many” scenario. That structure became economically viable for Skyytek.
8:47 How different are the revenues in the SaaS consulting world?
11:18 How does Skyytek plan to staff their early ByD projects?
12:55 How long will a typical ByD install take and how much will take place remotely versus on-site? Depends on size of the customer, but anywhere from 3 or 4 weeks to 4-5 months. Since the nature of SaaS is web-based applications, Skyytek will do all of their installs remotely as well.
14:30 Why are change management issues a factor in SaaS installs, and can a good SaaS consultant help with that process?
17:36 Ray has said it just takes a few weeks to train a NetSuite consultant in ByD, whereas it will take a few months to train an on-premise ERP consultant in SaaS…what is it about the skills challenge of SaaS projects that requires this longer period of adjustment for functional consultants?
19:48 And when Ray hires new SaaS consultants, he looks for small business process experts who understand lead-to-cash and other scenarios. Narrow GL experts won’t cut it. You have to have experience running a business. “We look for a techno-functional business person with SaaS skills. Skyytek wants a different skills focus – not GL, but an industry-specific focus. But within that industry, we want a broader process view. Deploying a SaaS solution – you can focus all your efforts making that system work for the business. If you have a narrower focus like AR/AP, there is a chance to break into SaaS by expanding the focus: the career opportunity is to get a broader process focus in SaaS. “
22:40 Ray’s advice to on-premise SAP consultants: work on the industry focus, expand your business process view beyond a narrow focus in accounting or supply chain.
24:00 But surely there will be some technical roles in ByDesign? Will the work be more on building out the platform? Ray: for customers, there should be no technical aspects to ByD whatsoever. But for the third party vendors, there will be plenty of development work, whether it’s a third party commission apps or a third party retail app. There will be small customizations needed in many customer accounts, but generally speaking, in a lot of cases, those can be performed by the end user.
26:30 Warning signs of SaaS gone bad?
28:18 SAP has acknowledged that it’s still sorting out how the partner and services side of ByD is going to work, so what are you telling them to ensure the product is going to get traction in the market?
32:00 SAP has faced a number of ByD obstacles – technical UI, pricing, partner rollout, skills trainin g- what do you think jumps out that SAP needs to tackle.
34:18 Putting Ray in fortune teller role: How does Ray see the ByDesign market unfolding?
37:15In the lower end of the mid-space, NetSuite is really going to be the biggest competition – but there really aren’t any other major competitors. But there are more emerging companies on the way that are getting their act together in the midmarket. Within two years in the SaaS ERP midmarket, I expect four major players with ByDesign being one of them.
39:30: Ray mentioned in Orlando that while his company is growing, Skyytek is shutting down physical offices. Why?
42:30 Ray: There’s been a lifestyle shift. There are stay at home mothers, fathers, a fantastic pool of consultants from SAP R/3 and Oracle etc who can’t commute due to circumstance, but we can put them to work if they have the skills.
45:00 So does the location of the consultant matter at all? Ray: it used to come up 5-6 years ago, but it really doesn’t come up now at all. Having geographical proximity can be good, but it’s really more a matter of customer perception than reality.