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March 12, 2006

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Ben Casnocha

I believe in the idea that "sometimes you should change your processes to fit the software."

I think it's compelling to say that a vendor that works with hundreds of other companies in a given segment will accumulate the best practice processes that other companies should adapt. When you can say, "We work with hundreds of governmental organizations and we've found this process to be the most efficient" - that's persuasive. Doesn't mean customization shouldn't be possible, but it does mean that process changes should be considered first.

Andrew

Neil,

Another great article! I concur with the Seibel exec as well. Who is to say SAP or PSFT is the process expert? I have seen many customers in highly specialized industries that find PeopleSoft over-simplistic. Is this good? It may be or it may simplify their business process so much that it limits the service they can provide to their customers. ERP customers must be able to adapt the software.

Couple other points
1. SOA talk often frustrates me. It is talked about as if it were legos, just plug it in and wham-bam it’s done. This couldn’t be further from the truth. I am not sure SOA changes the amount of development work at all. Let’s take the definition of a person or customer. No two SOA-enabled apps will define a person or customer the same way. This means integration will require transformations, tweaks, and consulting dollars. SOA is a door, you still have to walk through it; no one is carrying you over the threshold.

Now, I will say SOA can offer pluggable extensions in the market place and this may offer buy vs. build options. That day is still a theory now, but if it comes, it can offer benefits.

2. I will have to disagree that a company’s Java team can just step in and support or build on Fusion simply because it uses standard technology. It is not the technology as much as the process, as you say. Supporting Fusion is partially about knowing the tools and technology, but it’s more about the process and the understanding of how the process is executed in the vanilla code. These enterprise-wide java developers will not be able to just step right in.

3. Now, my counter to point 2. You are absolutely correct that infrastructural roles like architecture, performance, monitoring, etc can be taken over centrally with existing skill sets. Tuning a Java VM is still tuning a Java VM and organizations will benefit here. There is a dire need as I find most customers struggle with performance.

4. My last point is around the concept that one broad group (by technology) can support all of ITs applications. I have seen the inefficiencies of this model. Although it may be more cost effective, I challenge whether the same value will be present. By this, I compare companies offering Hosting to companies offering OnDemand solutions.

In hosting, a company will house your servers, patch them, provide internet connectivity and so on. The support staff is not trained in PeopleCode or other package specific technologies. Many PeopleSoft customers choose this route and in my experiences many were disappointed. The knowledge level and execution speed was simply not sufficient and ended up costing them competitive advantage. The central nature of the hosting companies made them jacks of all trades, but masters of none. Being the master helps create competitive advantage.

The OnDemand company, like SalesForce is slightly different. They host the applications, but those applications are their applications. They built them; they can call the actual developer to come look at a problem. This is the best of both worlds in that not only do they host your apps, they know those apps like the back of their hands. This allows them to provide exceptional value and speed.

If we equate Hosting vs. OnDemand to generic development teams vs. specialized teams, I think we will find greater customer satisfaction, greater speed and greater agility. The bottom line question is weighing the cost vs. added value. That question will have to be answered by IT departments everywhere.


Niel Robertson

Anil,

Great comments. I agree there are a lot of hidden costs associated with the SOA model. Also - I'm right with you that the management/tools for SOA might be a nightmare. I noted something similar to your thinking on my other blog about this N to the Nth management problem.

https://bigendian.typepad.com/big_endian/2006/03/soa_save_our_ap.html

Ric

While I am a strong advocate for service-based architectures, I am not convinced that I need to go Fusion (even with an E1 implementation in progress) when there are several other SOA/BPM/ESB/[pick-your-favourite-acronym] vendors who can deliver much of this stuff now, without tying me to a single ecosystem. There are a lot of smaller (than Oracle) companies who are more likely to stay with standards because they don't have an existing product base to protect, like Oracle and SAP do.

And much of your support for Fusion must surely be dependent on Oracle being able to deliver in a reasonable timeframe - something I'm not convinced of ...

Anil Passi

SOA will solve some problems, but will introduce complexities in other areas such as reporting.

Now in Oracle Apps, one module code updates the tables of other modules for the purpose of status tracking etc. For example the GL Transfer process may update Payables distribution or receivable distribution table for status progress into GL.
Similarly GL tables have an option to store Payables/Receivables Trx Ids for the purposes of drilldown.

However such methodology will have to change in SOA.

The thinking/mindset of developers building customizations will have to be aligned in accordance with SOA principles. Yet, I bet many developers will do things in old-fashioned way, and hence losing the benefits of SOA.

If an ERP software is run off by independent set of loosely coupled business services, then consolidated reporting can become a big issue in Oracle Fusion ERP.
I will not be surprised if Oracle by default will begin advicing its customers to manage a datawarehouse for reporting purposes. Yes you will save a few quid by hiring a java/c# programmerss, but you will spend more in consolidating your data for reporting. Also, you will spend more money on hardware too. Hence I do not buy into the idea that SOA based ERP's will save you money.

Thanks,
Anil Passi

Niel Robertson

I received this comment from an ex-Siebel executive. I thought it was worth adding to the thread:

I totally don't buy the go-vanilla part of Oracle’s story. I never have, even when I was at Siebel and this was the party line. Yeah, it might be easier to change the process to match the software, but is it smarter? The point is not the software, the point is the process. If you can't easily perform your process in the software, then it's the wrong software not the wrong process. The reality behind Hensarling's point is that software starts influencing process -- usually in a bad way. Though, I will grant you, that occasionally just having the software opens up some process opportunities. But the problem is that technical and business users both start seeing their process as the software. The software limitations are their limitations. Do you really want to bank your business future on what PSFT or SAP can do out of the box? Companies have to define and refine their processes independent of software. And, this is good for software, too. This is where software innovation will occur. When teams start thinking "what if we could do this?" and a company responds to that idea, then new innovations enter the marketplace. But if you're basing your competitive business processes just on what apps can do now, well that's pretty stagnant. Pack apps MUST allow easy configuration/customization as well as easy maintenance of those adaptations--or they should be gone. Yes, I like that term: “adaptation” rather than “customization”. Companies need apps that adapt to their processes AND they need a Chief Process Officer to manage this process to technology cycle!

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