The Arrogance of the BI Vendors

Is it arrogance, is it lack of interest, or do they not get it? You might think I am referencing Nic's post below with photo that seems to imply that Microsoft is the evil empire and PerformancePoint Server is the Death Star of BI. This, while plausible, was not where I was going.

I managed to carve out some cycles last week to spend time at OMG's Think Tank on standards for business process management - as in BPM. Not performance management. The think tank was by turns thought provoking and painful, often within a matter of minutes. It is always great to get a bunch of vendors and analysts together on a neutral site and watch the games begin under the guise of "helping the industry." If you want the blow by blow on who was thinking what, I recommend you check out Sandy Kemsley's blog. However, one of the things I found of interest was Colin Teubner's lunch keynote that discussed the relationship between BI and process management.

Colin is an analyst at Forrester Research, focused on business process management. He gave a lunch time keynote focused on BPM with two main discussions - the relationship between process and BI, as well as BPM intersecting with collaboration and information. Both are much longer topics for discussion, but Colin presented some more recent thinking from Forrester on the intersection of process and business intelligence. Colin suggested 5 specific use cases on how the two technologies work together.

1. Business intelligence on a process - analysis and reporting on process applications
2. BI triggering or changing a process - BI kicking off a process
3. BI inside a process decision - when executing a process, BI should help
4. BI to help humans work with process -more information is better to make decisions
5. BI to predict the future of process work - think trend analysis and data mining

Look for this to be a topic of further research from Forrester building on work that was started initially by Keith Gile (Now doing strategy for Business Objects) and Connie Moore, a VP and research director at Forrester. Colin is working on this with a number of contributors. Of particular interest were two of Colin's comments.

The first is that from the Forrester point of view, BI converging with BPM is a no-brainer. I tend to agree on this point and you can see this starting to happen with BPM companies introducing BI capability as core to their offering and partnering with BI vendors. MSFT performance point is also heading in this direction. See also the Spotfire acquisition by Tibco that I commented on when it happened. So what is the hold up?

According to Colin, one of the big issues around this discussion is the arrogance of the BI vendors. He noted that BI vendors should get it, but that they don't understand it well enough and they are too caught up with themselves. He was also specific that none of the top players really offered real process functionality today. This is a very interesting observation, especially when you consider how long BI vendors have been trying to explain their relevance and importance, especially relative to the ERP big guys. Guy commented on this here and here. Seems to be going on 20 years now. Nothing worse than a young adult with a sizable IQ and low self esteem.

Is this arrogance, insecurity, too much navel gazing, or not enough interest to motivate action? Maybe this is just as simple as the devil you know - much easier to deal with than the devil you don't and the associated multiples required.

I think this is an open question and something to watch. This post both catches me up on posting and addresses the open questions to me by my performance partners in crime. Now about this Death Star issue...

Here Comes the Mother Ship

Guy is not kidding when he says PerformancePoint is in full swing, two weeks ago was MGX (what Microsoft calls sales kickoff). The 15,000 person event was host to the latest and greatest product demos and feature the plans and strategy for the upcoming year. Included in the mix was a main stage demo of PerformancePoint Server tied together with the Microsoft Unified Communications products. The demo nicely tied together BI capabilities of scorecards, analytics, and planning with communications functionally via live meeting, instant messaging, and VOIP. If you’d like to get a good look at PerformancePoint, there’s a demo recording on YouTube from the recent Microsoft BI conference in Seattle featuring our good friend Bruno Aziza. There will be a continuous string of activities throughout the rest of 2007 and into 2008, so pack your bags and grab your favorite conference outfit, it’s gonna be a performance management boogie fest.

Oracle still on the move...

No, we don't have a juicy rumor to pass along today, but there are always tremors in the greater Bay area, aren't there? And our friends at Oracle seem not to be quite finished with their buying spree in the technology space just yet.

As posted in the very topical ZDNet blog, Oracle may be on the move once again.

We posted about this here and here, evaluating some of the pro's and con's of the remaining performance vendors out there in the marketplace today, but our Spidey Senses tell us that in this case, we need to think beyond the perhaps strict definition of performance management vendors and think about more broad-based technology and applications vendors in this case.

Perhaps something in the business process management space? What say you Performance Guy Pat?

PerformancePoint--Oh it's on...It's ON!!!

Gin up the ole PR machine, get your analyst briefing scorecards out, and start standing in line now for one of 1,000,000,000 field events (90% of them planned by Performance Guy Nic) around the world supporting the PerformancePoint Server launch later this fall. You thought the Paris Hilton coverage was a bit much--trust us, she's got nothing on our friends up in Redmond.

Our good friend Russell Damske from the B EYE (get it) network gives us an early preview, and trust me, this is only the beginning. (OK we've really never met Russell but we're sure he'd be a good friend if we knew him).

We're seriously thinking of live blogging the whole launch event here at Performance Guys, we're that excited. Not like Steve Ballmer excited, but very excited--more like Japanese funny dance excited.

PS--Nic is the one in the middle--

Lucid Era Blog

Here's a link worth checking out, LucidEra blog http://www.lucidera.com/blog/ this blog is put together by our good friend Darren Cunningham. LucidEra is an up and coming "on-demand" BI company and as the world of hosted BI continues to grow I'm sure there will be some interesting commentary, be sure to check it out.

You Just Gotta Read This - Open Source BI On the Move

Either it was a slow news week over the July 4th holiday in the states, a great interview, or both. Matt Asay on his CNET blog The Open Road, did an interview with Pentaho's marketing VP, Lance Walter. You know you are dealing with a pro because Lance took the opening softball question from Matt and gave him both barrels, citing a Crystal Reports replacement, as well as the Pentaho win at Universite de Montreal against the entire BI category. The press release is a complete category smackdown of the usual suspects in BI - Cognos, Business Objects and Oracle. Go big or go home indeed.

Also interesting to see Lance speaking kindly of the Jaspersoft camp while asserting that Open Source is big enough for everyone and undercutting those with proprietary technology. This follows rule #2 of marketing - it is not truly a category if you are the only one in it.

Open source is clearly on the rise, and Pentaho seems to be the leading voice in BI. Not only good technology, but good gear. This is not exactly a rule in marketing, but it sure is nice to have. Disappointing that Pentaho seems to be going more corporate as they no longer offer lingerie as a How?Ho! gear selection.

TIBCO announces a new BPM solution

The worlds of BI, performance management and business process management continue to come closer together. A couple of days ago, software vendor Tibco announced their new iProcess, a management suite of application modules built on open architecture providing and end-to-end development platform for business process modeling. This announcement is just another example of the BI, BPM, and PM worlds coming together and demonstrates the importance of a flexible open architecture.Building on their BI capabilities, Tibco also recently acquired data visualization up-and-comer Spotfire, more commentary on this from Pat here. The momentum in this space will continue later this year as September will showcase even more market changing technology as Microsoft comes to the table with two releases that bring BPM and PM together with the release of PerformancePoint Server and BizTalk Server.

As business climate intensifies the investment in SOA is integral to extract value from BPM initiatives over time. This performance guy smells something else cooking, look for more activity in this area of the market in the near term.

Smart Enough Systems - Read All About It

James Taylor and Neil Raden are out today with their new book, Smart (Enough) Systems, a look at the process of decisioning and a detailed overview of the intersection between business rules, process, business intelligence and measurable business impact. Data and technology you have vs. how you run the business everyday and what people use to make decisions.

I had the chance to preview the book and I think Taylor and Raden do a great job of setting up the arguments and then delivering a lively play by play on how to make technology work in the real world. The book is a great read for anyone struggling with how to make the rubber meet the road and providing information that is relevant about making process an operational discipline. Among the things I like about this book is the passion of the authors (the book starts with a manifesto!), as well as the number use cases and examples they come back to. Many books are great at citing examples from big clients, this book does a great job of painting the use case on an industry level that should make it broadly applicable for near term help and longer term reference. It is kind of nice to read a book with a POV, a how-to, and that also happens to be an interesting read.

Both these guys are well known in the industry and their views can readily be found at conferences and in blogs like James on Decisioning on eBizQ, and Neil on BI in Intelligent Enterprise. I am sure their book will be a success. You can purchase it from Amazon here.

As for the blog, I am back from early month vacation and typical end of quarter excitement and ready to provide some much needed balance to the resident performance Guy. Thanks to Guy for all the heavy lifting over the past several weeks.

Oh, Say Can you See, We Stand on Guard for Thee!

Happy Canadia Day and forthcoming Independence from Kings and Tyranny Day to all our readers this week. As the performance guys are a multi-ethnic melange of Canucks and Yankees, we feel an exceptional amount of pride and gluttony during this week of the summer. May our friendship endure as long as the border is long. Or whatever.

Cognos--Sagging or Just Lagging Support?

OK OK, nice double entendre I know, but since I'm the only Performance Guy posting these days (apparently there's this holiday called "Canada" Day that Nic is celebrating this weekend. Like that's real), and Pat's off somewhere reengineering cocktail processes.

So since the adults are away, let's continue our journey this week and shine the spotlight on another competitor in the peformance management space, our friends in Ottawa (speaking of this "Canada" Day celebration), Cognos.

Cognos announced their earnings this week, which was met with a collective gasp, cheer, or general yawn from the pundits on the market, depending on who you're reading. But the consensus seems to be settling around the main point of the AP article linked here, which points out that profit fell short, big deals fell short, and the go forward outlook was more conservative as well.

Now is this due to Oracle and SAP being more competitive? Not likely yet, as they, plus Business Objects, are still digesting acquisitions, so while there was certainly some short term pricing pressures on the part of the acquired vendors (the old "we don't want to raise prices but you never know what the new guys might do, they're CRAZY!" line of attack). But none more so than in past competitive quarters.

Is it a product portfolio issue? Again, it would not appear so. Cognos, as they are thisquick to point out ALWAYS, has been LIGHTYEARS ahead of everyone in the market on performance management. And in many respects they're right, although not really against Hyperion, and if you count the redundant consolidations and planning tools in house, I'm not sure it's quite as valid an argument, but as Mr. Glass house himself right now, I'll even give them a pass on this one.

Maybe it's market momentum? I have the personal opinion that the brand feels old, they've been hit with a lot of sales and product management departures, maybe it's just an execution issue? Whatever it is, they're not letting on, but the cracks in the armor are starting to show, and for the first time in months, the stock price fell below Business Objects price.
Now don't everyone shoot me on what stock price actually indicates, I'm not an idiot (Pat and Nic don't respond), but if you had $40 extra dollars today, and you could invest in 1 share of both Business Objects and Cognos, you'd have an equal choice--and that's a newer development.

So I believe that all is not right in the Great White North these days, and the unease you feel eminating from the recent earnings call is not imagined. It will be interesting to see how they turn this around given the rapidly changing dynamics of the market.

Applix Standing Out from the Crowd

Although the remaining independent performance management quadrant vendors are fewer in number, there ARE some interesting plays out there for companies, purely from a technology stand point. Applix is one such company. Their TM1 product has made the short list of acquisition targets from Palo Alto to Paris, from Stamford to Sunnyvale. But for some reason companies have never been able to pull the trigger.

We get one clue why some may be reluctant from this article on investing site Motleyfool, which takes a look at the great success Applix is having in the marketplace right now--increased earnings, growing top line and maintenance revenue, and continued customer acquisition.

The down side of all this, purely in terms of acquisitions, is that their value. While rated by the Fools as a 5-star pick, the multiples of the stock when compared to the revenue stream are hard to swallow. That it's trading at its 52 week high is great for stockholders, but not as great for the vultures out there.

Still, if there's one remaining independent performance management pure-play that has a chance, now due in part to their liquidity, it's hardly a "fools" (woo fools get it?) errand to think that Applix may be the one.

It's more of a journey, not a destination...

Still cleaning out the in-box from travel and vacation, but wanted to post this short Q&A with former Hyperion Chief Strategy Office of Hyperion, on his take on business performance management and what it takes to get up and going--quick read, not as much insight as I would have hoped for from the self proclaimed "Father of BI."

Howard is a tremendous asset for Hyperion and Oracle, and it will be interesting to see how his role with the new organization unfolds as the strategy for Hyperion and EPM becomes clearer. You already know there's a big change when the Hyperion results hardly merited a mention in the Oracle earnings call...

http://www.cio-weblog.com/50226711/qa_with_howard_dressner.php

Now playing, the “Less Attractive” Players

So if the previous post contains arguments FOR the last of the independents making their case successfully to customers vs. the SAP’s Oracle’s, and Business Objects of the world (okay, maybe Cognos too, fine, whatever), there’s lots of cases against them—let’s list some here.

Lay-Ups
· Don’t you think someone would have bought them if they had such great technology?
· There’s a reason we bought their competitor
· Performance Management is more than just , it’s really about and you, Mr. customer, need to be thinking here

18 footers just inside the arc
· Will the small vendor survive—can they survive?
· Big vendor customer base vs. small vendor customer base—where does the customer feel safer, with whom do they associate most?
· Technology—is the small vendor on old or outdated/legacy technology (um, yes if you’re Longview—kidding Longview readers!)

Heaves at the buzzer
· Dis their financials (can I still say “dis” as a white man?), growth, profitability
· Point out they are trying to sell themselves 24/7
· Position their technology outside of the mainstream of performance management

So what are some others?

Question for the Class:

Does the recent consolidation of performance management vendors make the remaining independent vendors MORE valuable or LESS attractive to customers?

Let’s take the “MORE” argument first.

Low hanging fruit:
· less competitive clutter and comparison companies to be evaluated against for an acquisition
· easier to play the “we’re the last of the independents” card than before
· take advantage of vendor integration issues and make hay in the market before bigger vendors get their stories straight

Medium hanging fruit:
· Clearer differentiation between their story and the larger faceless nameless conglomerate
· Faceless nameless conglomerate has lots of okay products to sell, they have one really good one
· conglomerates move slower, slower to respond

Not quite ripe fruit:
· “We’re seeing a lot of people trying to join us since the acquisition was announced.”
· Threat of product discontinuance or lack of ongoing support for products makes the independent vendor more reliable and dependable.
· Now the current product line-up of the conglomerate de-emphasizes so this isn’t a core business for them like the independent vendor.

What am I missing here?

The CFO Presentation

So in my last post I talked about the theme of the keynote presentations at the CFO conference--and how mine was different and why I thought it was important that it was.

And it's not a huge long ego trip for me to say that it was great "because" it was different, or great just for the sake of being different. Or that it was even great. Which it was, but that's beside the point.

The point was that CFO's are inundated today with the same information when they're at work--they hear the vendor pitches, the inventive direct marketing campaigns designed to somehow skirt the executive assistant and magically make it onto their desk--they've seen it all.

And if they're going to pay money to leave work for two days and spend time in a darkened conference room, then they're not looking for 2 year old market stats. They're looking to be inspired. They're looking for that spark that starts a process, an idea, heck, that something keeps them awake.

And so talking about the importance of strategy and strategic planning was an interesting approach for me, as we obviously could have trotted out the same old slides about process and closed loop solutions. But when we saw that no one was talking about strategy, a topic that's in the forefront of a CFO's mind, but which they don't get to spend as much time as they'd like, we knew we had a winner. And grabbing almost 40% of the conference into our presentation up against 4 other vendors was great validation.

The CFO Conference a Few Weeks Ago.

Nic and I had the good fortune to land at the same conference in NYC a few weeks earlier for the most recent installment of the CFO Magazine Performance Management donnybrook in beautiful Times Square in Manhattan. In between ducking for cover between rainstorms, we managed to get some great insight from the executives on sight.

To build on Nic’s recap (a bit short and lacking in any meaningful detail if you ask me), I thought the event was, well, fair. Actually I expected a bit higher caliber event than we got, which is due in no part to the hard working staff from CFO.com. Unfortunately the keynote speaker, Craig Schiff, was late to his own presentation, owing to traffic delays, so the day didn’t start off great by going right into the customer presentation. Normally you’d expect to set the tone with the analyst and then dig into details with the customer, but the opposite happened here, so it ended up being somewhat disjointed.

I’m also not sure that we gained any real new insights from the keynote presentations. There was certainly some good, if dated, materials, but it seemed to be a bit of a rehash of things we’ve heard before, and that’s where things fell a bit short for me.

It’s also hard when you have to plan for a common denominator of attendee—a decision between talking about really cool content that appeals to a fraction of the audience, or the safe middle ground that covers the majority of the attendees. So the keynote speakers clearly went for the middle ground.

I took a different tact however, and will leave that for my next post, as I think it really illustrates the issue that both analysts and vendors have in today’s performance management marketplace.

More to come…

Back in Black

My apologies for the lack of posting here in our little space on the Internet. The travel and vacation bug has struck the Performance Guys—or at least 2/3 of us, and Pat will rejoin the fray next week. But I’m back in action now and ready to tell ALL about the CFO conference a few weeks ago.

Budget Mistakes Excel

How much Excel can business users really handle and how much lack of spreadsheet knowledge presents a burden to the finance department? Here is some interesting data put together by the Buttonwood Group and CFO Magazine on the situation. The survey found that front line managers typically rejected planning and budgeting software applications and relying on finance to step in and prepare the budget on their behalf, creating a lot of extra work for finance and results in a lot of budget mistakes. Do line of business managers have the Excel skills to build accurate budget numbers to begin with? This survey would suggest not, and claims to place an onus on vendors to being pushing a simple interface for the budgeting process that is “business user friendly.” One could argue that much of this is not a skills issue but rather a cultural issue and needs to be ingrained into the ways line of business managers think about planning and budgeting, some might say it’s simply job security for finance heads.

CFO's in the House

A couple of the performance guys had a chance to attend CFO magazine conference this week in New York where CPM was the hot topic of debate and finance executives had a chance to mix and mingle with each other to gather insights into how to drive performance management best practices in their business. The intimate event hosted about 175 attendees and offered vendors a chance showcase their position on CPM. The event certainly demonstrates the momentum in the area of performance management and its relationship with BI. Craig Schiff of BPM Partners also provided a keynote, I’ll let the other performance ‘Guy’ chime in on his thoughts on the event.