To SaaS or Not, Is That a Question? – SaaSy Discussions

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described the opportunities for software as a service (SaaS) or on-demand applications, especially in the current difficult economic milieu. Part IIa then analyzed the top five SaaS assumptions (misconceptions) recently outlined by Gartner.

Before any vendor can embark onto delivering a SaaS offering, it must thoroughly consider a number of harrowing SaaS technology choices and their implications. Thus, Part IIa also analyzed the decision’s impact on the functional footprint (scope) of the future SaaS product, after which the aspiring SaaS vendor must identify gaps within its in-house skill sets and define how to fill them.

This part continues with the other major remaining technical considerations before any vendor can embark on delivery of a SaaS offering.

The Tenancy Decision

While the true multi-tenant design approach for SaaS is the best in terms of highest scalability and lowest operational overhead (and it allows moderate to extensive software modifications), it also requires the highest initial investment. Thus, in some cases, the traditional single-tenant hosted/application service provider (ASP) model or partial/hybrid (something in between) solution may be appropriate. Namely, the application virtualization approach enables single-tenant solutions via tenant management (virtualization) tools from Wrapped Apps Corporation, Parallels, or Citrix Systems.

The major considerations here for independent software vendors (ISVs) (not necessarily end users per se, although everyone should be informed at least) are the following: whether there is legacy code that could be somehow leveraged (or that would be difficult to rewrite), how many new SaaS implementations per year are forecast, and whether the SaaS model has been proven in the target market. In any case, it is critically important to get the product’s architecture right up front, since making any corrections and rectifications along the way will be complex and expensive.

In addition to the tenancy considerations, one must address the questions of scalability (in terms of load balancing and routing), availability, performance, and configuration-driven customization (both to accommodate personalized look-and-feel and special functionality). Other architectural factors are system integration, information security (including identity management), usability, communications (e.g., via e-mail, short message service [SMS], instant messaging [IM]), global (multinational) capabilities, audit and compliance, and system backup and recovery.

The above overwhelming combination of factors influences not only the SaaS applications architecture but also the underlying infrastructure (platform) architecture. I would also add the cost of full time employees (FTEs) charged with handling all these issues.

While there are costs with multi-tenancy, over time the costs to handle each of these architectures can and probably will exceed multi-tenant design costs. Current macro-economic conditions are making one or the other approach seem cheaper right now, but as the economy rebounds, the question will come up about long-term strategy.

Finally, the costs for compliance are very high (and can be so high that it is out of reach for new entrants) to get enterprise-class services and certifications and audits, such as ISO/IEC 27001, SAS 70 Level II, Systrust, etc. Each part of the system must be audited and these audits can cast to the amount of US$100.000 and higher. Thus, multiple components in any architecture will lead to higher compliance costs, but that’s another blog topic.

Forget Not About the “SaaS Plumbing” Thingies, Either!

But even solving these multiple pieces of the architectural puzzle is only the beginning, since one also must include many SaaS-specific “must have” pieces of functionality, such as a pricing engine, a billing engine and payment processing, tenant and subscription management, service provisioning, system usage and performance (uptime) monitoring, and subscriber management and self-service. Creating all these “SaaS plumbing” components requires significant effort (in addition to the necessary “know-how”), and the company must thoroughly plan for it.

During the Webcast mentioned in Part IIa, Scio Consulting International claimed that this functionality takes from 20 to 50 percent of the research and development (R&D) effort for an entire SaaS application. The conventional wisdom is to leverage commercial SaaS components and services for time-to-market (TTM) reasons.

For example, commercial SaaS billing applications options would be OpSource Billing CLM (Customer Lifecycle Management), Zuora, or Vindicia, whereas SaaS customer management applications would be OpSource Billing CLM and Aria Systems. While PayPal has become the standard for online payment processing, uptime service level agreement (SLA) monitoring can be done via TrustSaaS, Absolute Performance, and the SaaSMonitor.com offering from MVP Systems. Last but not least, SaaS enterprise applications integration (EAI, including links to on-premise applications as well) is offered by Boomi’s AtomSphere suite, and Cast Iron Systems. Sonoa Systems provides analytics, management, and IT governance solutions for cloud services and application programming interfaces (APIs).

PaaS The Hosting, Please!

This brings us to the discussion about choosing the technology stack (with the following technical layers: application, deployment platform, and infrastructure) in a do-it-yourself (DIY) or other fashion. Namely, as ZDNet’s blogger and SaaS connoisseur Phil Wainewright explains well in his recent blog post, there is a plethora of platform choices for vendors, including commercially available platform as a service (PaaS) options.

Some examples of available PaaS offerings would be the following: SaaSGrid from Apprenda, Force.com from Salesforce.com, Google App Engine, Bungee Connect, Facebook’s Platform, Apple’s iPhone Platform, pieces of Microsoft’s still upcoming Azure Cloud Platform, and so on. In the case of Salesforce.com, there are three main ways that ISVs can partner with the vendor as a platform: build, market, or sell.

Force.com is designed for those that want to build applications (without bothering with porting, integration, security, hosting, infrastructure, etc.), while the AppExchange directory is for ISVs that already have an application of their own and are focused on marketing it. The upcoming Checkout service (currently in the pilot phase) will be for those who want to fulfill sales using Salesforce.com’s infrastructure.

Force.com is also flexible, so that developers can use Salesforce.com’s Visualforce presentation-layer development environment or other toolkits such as Eclipse (Salesforce.com has an Eclipse plug-in), or other third party development environments to create custom applications that do not look like the traditional Salesforce.com user interface (UI). In addition, Force.com has its own programming language, Apex, which can be used to create highly customized applications via the Java-like language.

Indeed, selecting the right PaaS may simplify the technical decision process, accelerate time-to-market, and reduce development and operating costs. A PaaS takes care of software components (services) creation (via managing metadata and portals), deployment (i.e., ordering, provisioning, and metering), and execution (via SLA management, billing, and subscription management).

In fact, the abovementioned necessary SaaS add-on plumbing applications (monitoring, billing, provisioning, etc.) also come bundled within a PaaS, and can save time and money while adding value to the vendor’s operations. Finally, a PaaS also provides the necessary components for reporting, alerts, and dashboards.

Two Force.com Endorsements by ERP Veterans

Salesforce.com’s Dreamforce 2008 user conference, which coincided with the historic US Elections, was marked by exuberance, confidence, and an overall upbeat feeling, in sharp contrast to the ongoing market sentiments. Ray Wang and Vinnie Mirchandani have described the event in their respective blog posts.

What really caught my eye there was seeing the two longstanding enterprise resource planning (ERP) players, CODA (now part of Unit 4 Agresso) and Fujitsu Glovia, opting to write brand-new products on Force.com. Salesforce.com’s blustery chief executive officer (CEO) Marc Benioff even (half-jokingly or not) taunted SAP (during his intellectual debate with SAP’s co-founder Hasso Plattner in early 2008) to rewrite the SAP Business ByDesign on-demand product on Force.com, rather than to “further torture and embarrass itself” (and the rest of the traditionally stodgy on-premise vendor community).

Even though this challenge might sound ridiculous for too-proud SAP to acknowledge and succumb to, that suggestion begins to make sense to me, in light of the giant’s initial faltering with SAP Business ByDesign. Well, maybe SAP could acquire Salesforce.com and solve its SaaS conundrum once for all, but that might be a bit difficult to pull off (at least during these days of limited spending)?

I concur with Dennis Howlett, who in his recent blog post on CODA wondered why a company with a 30-year history of writing world-class finance applications and with 2,600 renowned customers would entrust its on-demand future (i.e., the CODA 2go SaaS product) to a new, relatively untested platform. According to Jeremy Roche, CODA’s CEO, the attraction came in the following four distinct forms:

1. Access to a pre-built infrastructure that includes a security model, workflow, reporting, and multi-tenancy.
2. The ability to gain immediate access to Salesforce.com’s customer and partner ecosystem.
3. The ability to have the Coda 2go product run from Salesforce.com’s datacenters, reducing the need for infrastructure and gaining access to massive painless scaling.
4. The inheritance of Salesforce.com’s credibility in maintaining a world-class service since Coda 2go runs on the same servers and infrastructure as Salesforce.com’s.

For its part, Glovia had initially ported a cut-down on-demand version of its established glovia.com ERP product. The vendor named its erstwhile SaaS product GSinnovate, but has apparently not sold a single license since 2006. In our recent discussions, Glovia conceded the need for the SaaS channel (and more), and thus the decision to go for Salesforce.com’s AppExchange and Force.com. Glovia plans to deliver on-demand products that will address one business process at a time, starting with the generally available glovia.com Order Management product.

There Is No Such a Thing as a Free Lunch PaaS

At the end of the day, a PaaS platform is not a charity that is free of charge, but rather a significant cost item that will cut into the SaaS vendor’s bottom line ever after (as well as will all the other necessary individual SaaS plumbing components). Thus, many SaaS aspirants might still opt for the grueling DIY approach by using some free and open source software (FOSS) LAMP (Linux, Apache, MySQL, Perl/PHP) bundle or Ruby on Rails (RoR).

On the commercial software side, there is always Microsoft’s stack, which consists of Windows, Internet Information Services (IIS), ASP.NET, and SQL Server. Progress OpenEgde, Oracle SaaS Platform, various SaaS programs from IBM, and so on are other SaaS platform (but not necessarily all-inclusive PaaS) alternatives.

In any case, the DIY vs. PaaS dilemma should take into the account whether there is a match between the technology requirements with the SaaS vendor’s available in-house expertise. When leaning towards PaaS, the SaaS vendor should ascertain whether its target market is part of a particular PaaS marketplace (ecosystem), as well as the time-to-market and R&D cost savings vs. the costs of using the PaaS. Certainly, there is a trade-off between the abovementioned benefits of a PaaS and the dependence on the PaaS provider (i.e., what happens if the PaaS provider goes out of business?).

An Introduction to E-learning and Learning Management Systems

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Not so long ago (or, back in the early ’90s, when I was a first-year college student) there were two ways to get a post-secondary education: by attending classes at a university or college with hundreds of other coffee-stoked students, or by signing up for what used to be called “distance” learning (or even before that, “by correspondence,” as though courses consisted of a series of letters exchanged between the student and the professor, and delivered by the Pony Express). Distance courses still exist, of course, but increasingly, even these programs are undergoing drastic change because of their use of technology.

Over the past decade or more, a new style of education has been emerging for traditional in-class college and university programs as well, changing the ways instructors and professors teach and students learn. Humanism—the philosophy originally espoused by universities—has always held that technology could and should be used, along with rationality, ethical philosophy, and universal morality, towards improving the human condition. However, it seems that the balance is being tipped increasingly towards a privileging of technology over other means to that end.

Universities are jumping enthusiastically on the technology bandwagon, and it’s no longer uncommon for professors to supplement their lectures with PowerPoint presentations, or for students to take notes on their laptops (Acadia University, in Wolfville, Canada, has been offering “free” laptops to all first-year students for more than ten years). And an ever-growing number of professors set up course web sites that allow students additional opportunities to ask questions, or to access the course syllabus, should they have happened to lose that pesky, fly-away hardcopy version handed out the first day of class.

What does all this extra technology-based stimulation mean in practical terms (besides reducing the number of times the prof has to answer questions about when the term paper is due)? With PowerPoint replacing “old-school” photo slides and clunky overhead projectors, burnt-out bulbs interrupting lectures is no longer a concern. Students can use their laptops not only to take notes more speedily (most people type faster than they can write), but also to access dictionaries and other writing or reference tools in situ.

Course web sites can also offer students supplementary materials without the time-consuming hassle of going to the library (a decided benefit for students with physical disabilities). Graphic elements, such as art, diagrams, or photos, can help students who are visual rather than auditory learners. Chat rooms and other collaborative tools can help to maximize student participation in courses with ever-increasing enrollment caps.

The benefits of e-learning are not just for universities. Many elementary and high schools are also implementing learning management systems (LMS) in their classroom, for attendance tracking, creating and administering tests, e-mail, grade posting, and many other administrative and teaching tasks.

And certainly no less important—probably much more important to readers of this blog—is the fact that businesses of all sizes are changing the way they perform certain operations as a result of implementing e-learning and learning management (LMS) applications. Human resource managers are discovering how to optimize employee performance with e-learning or LMS software.

What Is a Learning Management System?

An LMS is a software technology that allows organizations, including corporations and educational institutions, to manage and schedule all aspects of teaching and training. An LMS can aid in creating course calendars and other material, in easing administration and communication, and improving tracking of student or trainee progress. An LMS can be implemented through the Internet with open source software, it can be licensed from a provider, or it can be purchased by an organization. The term e-learning refers to any training or learning that is done with an LMS application, or that is computer based.

Top Business Benefits of E-learning with an LMS

* Reduced costs associated with training fees, travel and accommodation expenses for workshop or course trainers, and lost employee work time
* Computer-based training can more effectively and actively engage the student and produce better test results and higher rates of retention, thereby improving on-the-job competency and efficiency
* Larger numbers of employees can receive training in shorter periods of time; employees can be exempt from certain courses or modules if they demonstrate competency by passing a pre-test
* Reduced administrative hassle for course registration, and course content, resulting in further reduced costs
* Greater volumes of employees can receive timely training, as a result of by-distance access to online training programs or courses
* Reduced employee turnover, as more efficient training and better test results can boosts employee confidence and performance
* Modules for employee training can assist organizations with compliance issues, partly due to more consistent or “centralized” course content

What Risks Do Business Managers Need to Consider before Implementing a Learning Management Solution?

* Align learning with business goals, as well as employees’ personal goals, to make sure time and resources are maximized.
* Develop a well-planned business case to win senior executives approve a proposed e-learning or LMS project.
* Identify the gap between actual or current training results and desired results, so that you can choose an e-learning or LMS solution that addresses your specific needs.
* Assess your company’s IT infrastructure to decide whether to implement a hosted or a licensed solution.
* Make sure you choose a solution that will integrate with your existing human resources (HR) or enterprise resource planning (ERP) solutions.

Mitigate Risk with Online Software Selection Tools (Or, How an Online Software Selection Process Can Help You)

* Compare vendors offering LMS solutions with those offering content management system (CMS) solutions, to find out which best meets your needs.
* Evaluate vendors that provide modules for competency and performance management.
* Examine functionality that supports course content authoring or publishing tools.
* Determine which solutions satisfy your requirements for classroom or e-learning facilities.

More LMS and E-learning Resources

* Get an overview of content management systems (CMS).
* Read articles by industry experts about learning management systems (LMS).
* Download a sample LMS request for proposal (RFP) template.
* Access white papers about the benefits of LMS and case studies about e-learning best practices and how specific vendors’ LMS solutions helped achieve e-learning goals.

Not all of your students or trainees may be geniuses, but their training results can be markedly improved with LMS-based training.

Think of this simple formula (slightly modified from the original), if you need further incentive to consider LMS:

e-learning = mc²

with “m” representing the mass number of employees you can train more effectively, the management of knowledge, as well as the money you’ll save, and with “c” representing the speed (Latin celeritas) at which you can train them, and get them back on the job and performing better than ever.

Are Spend Management (or SRM) Apps Suited for the Mid-market

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introduced some common supply chain challenges and resulting spend management opportunities for companies of all sizes. The article then went into the philosophical and functional differences (if any) between the “spend management” and “supplier relationship management (SRM)” monikers.

Further discussion was about what exact functional parts of this software category small and medium enterprises (SMEs) might need. To that end, Part 2 focused on typical Sourcing and Procurement capabilities that cover most of the spend control needs for mid-sized enterprises.

The third and final part of this blog series showcases one incumbent (and not so vocal) midmarket product, Epicor SRM.

One Tacit Midmarket SRM Provider

Epicor Software Corporation is a global company dedicated to providing integrated enterprise resource planning (ERP), customer relationship management (CRM), supply chain management (SCM), and professional service automation (PSA) software solutions to midmarket companies and divisions of the Global 1000. Founded in 1984 and headquartered in Irvine, California (US), Epicor serves over 20,000 customers in more than 140 countries, providing solutions in over 30 languages. For more details on the company’s offerings, see my blog series on Epicor in early 2008.

The Epicor SRM suite stems from Epicor’s acquisition of certain assets of formerly Atlanta, Georgia (US)-based Clarus Corporation in October 2002, as part of its strategic initiative to offer a comprehensive and integrated enterprise solution. For more information, see TEC’s 2002 article entitled “Epicor Picks Clarus’ Bargain At The Software Flea Market.”

The acquisition brought an initial set of SRM solutions covering Web-based procurement, sourcing, online invoice presentment and payment (settlement), and the ePortal Supplier Pack for secure supplier access to relevant information. Then there was View BI, a business intelligence (BI) module for spend analysis, and finally eTour, a training and reference application available 24/7 through a Web browser.

eTour has since been retired, since it was underused and too expensive to maintain. For its part, View BI has meanwhile been replaced with Epicor Enterprise DecisionStore for spend analytics. The invoice presentment and payment module was never really completed by Clarus, and Epicor chose not to invest in it because the company felt that procurement, sourcing, and spend analytics were the most important and most value-add midmarket SRM solutions. Indeed, electronic invoice presentment and payment (EIPP) solutions have long been offered by Ariba, Basware, and J.P. Morgan Xign.

Product Development Goes On

Since 2002, Epicor has delivered three major releases and several minor releases, especially of the Procurement module. These enhancements have all required internal development, since there have been no other SRM-related acquisitions. In late 2003, the vendor announced the release of Epicor eProcurement 7.3, a purchasing management solution that provided a connection between buyers and suppliers for the purchase of direct and indirect goods and services within the framework of defined business rules.

New in eProcurement 7.3 was the integration of inventory management and back-office purchasing modules (e.g., with the back-office purchase order approval routing and end-user requisition capabilities). Blanket purchase orders and releases was another major group of capabilities within the 7.3 release.

For example, permissions to create blanket purchase orders are configurable, and blanket orders can be used for either private or public consumption. Blanket orders’ characteristics (or specification of the goods or services that the order covers) can be specific items and quantities, a monetary amount of one or more product categories, or a general monetary amount, regardless of items or categories. Blanket orders also support effective dates and consumption priorities, while order releases can be done individually or on a schedule.

Furthermore, the proxy effective dates and organization requisition proxy group capabilities in Procurement 7.3 are associated with the ability of one user to assign another user as a proxy requisitioner or proxy approver for a specific date range. Other nifty features that were introduced at that time included one-click order copy capability, the ability to link e-mail approvals directly to the purchase order, the ability to approve from an order’s line detail, the ability to create a catalog item from a non-catalog item, and the ability to add attachments to extensible markup language (XML)-based purchase orders.

The most recent release, Epicor Procurement 7.3.6, was delivered in 2007 and featured major purchasing workflow improvements. For example, in the previous 7.3.5 release, any sourcing intent by the buyer would always come before management for approval, and also required a requisition review for non-catalog items.

However, the 7.3.6 release introduced the ability to set the pre-specified level of management approval required before sending a non-catalog order to a buyer for sourcing. Additionally, there is the ability for a buyer to submit a sourced requisition directly to management for approval within the workflow.

Moreover, line-item level approvals and disapprovals permit more granular decision making that keeps the process moving with reduced effort by all participants. Namely, approvers can change orders on the fly, while the workflow routing configuration can be based on what has changed (e.g., accounting methods, items, dates, etc.). Other noted functional enhancements were the following: a replenishment workbench, requisitions for stock transfers, ad hoc notes logs for suppliers and orders, advanced order search (by item level and keywords), and workflow configuration.

The Current State of Affairs

As with all Epicor solutions, the sweet spot for Epicor Procurement and Epicor Sourcing is the midmarket, where efficient management of corporate spend and automation of internal processes are significant competitive advantages. Epicor Procurement has been licensed by over 140 companies (not all of them have implemented it yet, though), while Epicor Sourcing has been licensed by about 20 companies. The number of Procurement users per customer ranges from 20 to 3,000.

Epicor’s SRM solutions are truly horizontal, and applicable across various industries. The majority of Epicor SRM customers are in North America, although each global sales region has Epicor SRM on its price list. Epicor Procurement is currently available in English, French, and Spanish, whereas Epicor Sourcing is available only in English.

Currently, Epicor does not actively market Procurement as a standalone solution, but has gotten a few deals that way anyway. The Epicor SRM sales pattern has shown a steady upward trend from 2003 right through to now. Since most of the low-hanging fruit in Epicor’s customer base have licensed Procurement in the 2003-2007 time frame, one could attribute the continued steady product sales to the vendor’s ongoing education of the midmarket about the importance and opportunity of spend management and related best practices.

Epicor SRM is most often sold as part of the complete Epicor solution. Thus, about 95 percent of customers that purchase Epicor SRM are buying it as part of the overall Epicor ecosystem. The fact that the vendor offers an end-to-end solution is one of the key value messages for its target market.

According to the vendor, in the midmarket the biggest competitor for Epicor Procurement is “doing nothing.” If a current customer is interested in procurement, the company almost never looks beyond Epicor. If Epicor is engaged with a prospect, then procurement is most often part of a bigger deal that includes a full ERP system.

In those cases, Epicor usually competes against Lawson Software, Oracle, SAP, and Microsoft. The Microsoft Dynamics ERP products do not have their own strong procurement capabilities. Thus, they have to bring in a third-party solution, and that plays to Epicor’s benefit. Lawson, Oracle, and SAP do have their own procurement capabilities, but feature-for-feature Epicor Procurement can win.

In general, Epicor plays Procurement as a strong differentiator for a total Epicor ERP decision. When Epicor is competing in standalone SRM/procurement deals it faces off Ariba and some vertical niche players. The company has also occasionally sold Procurement into accounts that are running SAP, Oracle, Microsoft Dynamics GP, and other ERP systems, where Epicor Procurement was evaluated to be a superior solution.

Product’s “Order Winner” Traits

Packaged integration to Epicor Financials and Epicor SCM solutions and to other ERP systems results in the inherent ability to handle internal inventory orders and perform three-way matching in accounts payable (A/P). Other differentiators include configurable, point-and-click purchasing workflow automation (with no programming required), a patently simple user interface (UI), the ability to approve orders from a mobile device, “Tap Outs,” “FreeForms,” and a “360-degree” budget and commitment checking process.

To explain some esoteric terminology, “Tap Out” is Epicor’s term for what Ariba and Oracle call “PunchOut” and SAP calls “Roundtrip.” It is the ability to leverage suppliers’ e-commerce sites during the search, select, and shop experience as an alternative to managing supplier catalogs locally.

The Tap Out feature sends requisitioners’ credentials to the supplier site and allows them to add items to a shopping basket there. But instead of going through the “check out” process on the supplier site, the basket/shopping cart is brought back to the procurement application (via XML) so that it can be submitted through the procurement approval workflow before placing the order with the supplier.

For their part, the “FreeForms” feature provides the ability for Epicor customers to create Hypertext Markup Language (HTML) forms that become part of a requisition. A common example is for ordering business cards. Namely, the catalog online shopping item might be for a box of 1,000 business cards for US$14.95, but additional specific information for printing on the business card is required to go along with the order (name, address, phone, etc.).

To that end, a procurement administrator can create a FreeForm for entering that additional information and require that the form must be completed whenever the business card item is requested. The form then gets transmitted to the supplier with the order.

FreeForms can also be used for internal requests (e.g., vacation requests to the human resource [HR] department) or for very simple requests for quotations (RFQs, e.g., today’s price on a commodity) in which a supplier fills in the required information on a form related to a specific request. A FreeForm can be created in any HTML authoring tool (including Microsoft Word, to make it really easy). When ready, a FreeForm is uploaded to Epicor Procurement and the module automatically creates the database tables necessary to manage the fields that are included on the form.

Thou Shalt Remain Under the Budget

The feature that also gets the attention of prospects and customers is Epicor’s capability around “budgets and commitments.” This feature, which was breifly mentioned in Part 1, captures commitments not only from the Procurement module, but also from other sources of spend, including A/P and general ledger entries.

The Budget and Commitment Checking feature may deserve an article on its own. In a nutshell, the capability continually accumulates commitments from multiple sources that come from (not necessarily Epicor’s) procurement, accounting and supply chain management (SCM) modules. An administrator can configure which sources to include as a commitment (against accounts) according to their business requirements.

The company can create business rules to define what exact transaction states constitute commitments. For some companies, perhaps a purchase order is not a commitment, but goods received but not yet invoiced are commitments. For others, perhaps only invoices are the first establishment of a commitment.

A raft of the budget control settings allow companies to specify what requisitioners are allowed to see in budget numbers. For their part, budget override authorities by title, similar to spending limits, determine “how high” in the hierarchy one has to route a requisition for approval based on how much a budget has been exceeded.

My intention in providing this level of detail is to point out how sophisticated and comprehensive this Epicor SRM capability is. The process is comprehensive, much more than a high-level integration between Procurement and GL/AP, and it is done in a way that allows for budgets or commitments to come from non-Epicor sources too.

To the end of the important premise of spend management (i.e., to stay under budget), the Budget View provides approvers with the opportunity to perform “what if” scenarios with all orders pending their approval to determine the optimal combination of approvals and disapprovals to meet budget control objectives. Last but not least, and also related here, Epicor SRM also features strong spend analytics capabilities.

What Is Not Quite as Impressive…

On the downside, if managed catalog service is a strong requirement, Epicor SRM not likely to win the deal. Epicor has customers who integrate Epicor Procurement to outside catalog services using the abovementioned Tap Out feature, but Epicor does not provide those services.

Epicor offers multiple supplier enablement options (including purchasing cards), but is not involved in creating supplier networks (hubs) like Ariba Supplier Network (ASN), Perfect Commerce’s Open Supplier Network (OSN), or Hubwoo’ Transactional Hub. Suppliers can be connected or “enabled” using a variety of means including Electronic Data Interchange (EDI), XML, Web forms, or other e-commerce tools. Typical benefits of supplier enablement include reduced supply chain costs, improved invoice tracking, reduced procurement costs, reduced or eliminated non-value added (manual) processes, and improved communications.

Furthermore, Epicor SRM includes only some basic contract management capabilities. The vendor has not pursued EIPP or supplier hubs mostly because it did not have full confidence that the investment would achieve a payback from the midmarket. Large corporations are there and ready, while the midmarket is not yet there according to Epicor’s findings. But the vendor claims to have a roadmap that will get it there and will continue to educate its customers toward those best practices after they have mastered the basics of spend management.

The recently unveiled Ariba SIM (Supplier Information Management) platform is a good example of why Epicor will gladly wait and see before joining the supplier hubs fray. Namely, the question is why it’s still only early days for Ariba’s SIM solution, although the vendor has been in the supplier network/directory business for well over a decade.

Epicor’s SRM experts have always contended that the ASN was important to Ariba and suppliers, but very light in content. Namely, it is an uphill battle to get suppliers to pick a single network where they keep information (including item and price catalogs) up to date. That costs a supplier money and time and there are no decent tools available to syndicate their data to multiple hubs.

Even though Ariba is the gorilla here, there are still many other bases a supplier needs to cover to transact with myriad buyers. Think of how many “supplier directory” publishers have come and gone over the years. To be honest, Ariba is doing what I think they should be doing as a leader in the space, and it might ultimately help its tier-one customers. If Ariba can figure out a way to democratize the data and monetize its delivery for the other over 90 percent of companies, Epicor will be listening and reacting.

In its response to Epicor’s assertion, Ariba points out that the reality is these are not early days with the Ariba SIM solution as the vendor has been doing this for years now. The solution is only now packaged differently.

“Ariba has a comprehensive Supplier Management Solution launched seven years back to address Supplier business processes around Transactional enablement and help buyers evaluate Supplier performance using Ariba Supplier Performance Management solution and has hundreds of customers who use this solution successfully. Ariba Supplier Information Management, though recently unveiled joins the Supplier Management family and is intended to unite both the Transactional and performance aspects of Supplier Management.

Companies like Epicor have no choice but wait, since developing comprehensive Supplier Management solutions are not about technology, but about an eco-system which includes a robust Supplier Network, flexible and scalable services to help buyers manage suppliers executed using leading Spend Management technology.”

SaaSy and Cloudy Dilemma?

Moreover, in light of the architectural prowess of some of its Epicor brethren solutions, Epicor SRM is not a technological trailblazer. Currently, the product supports Active Server Pages (ASP) and Dynamic HTML (DHTML) on the Web client-side, Visual Basic (VB) for the Web application server business logic (objects), and runs on Microsoft SQL Server database. There are packaged integrations to Epicor Enterprise and custom integration to the legacy Epicor Avanté product.

Epicor perviously worked with a third party that provided integration to Microsoft Dynamics GP. Now, Epicor Procurement comes with a set of Web services that can be used to integrate to the SAP, Oracle (including PeopleSoft), and GEAC (now Infor) back-office systems.

As for the recently unveiled converged and Web 2.0-enabled Epicor 9 suite (which already includes strong buyer workbench and advanced purchasing capabilities), initially, Epicor will provide SRM integration to the new Epicor 9 Financials and SCM modules. Later, it will migrate it to the latest Epicor TrueSOA™ technology platform. Epicor completed its second-generation service oriented architecture (SOA) platform with the release of the ICE (Internet Component Environment) 2.0 framework alongside Epicor 9. Additional modules are planned for development, including Procurement and Sourcing applications.

Currently, Epicor provides single-tenant on-demand SRM deployment via managed hosting service of Epicor Procurement for some customers. The vendor is exploring the midmarket opportunity for multi-tenant software as a service (SaaS), but it doesn’t have any firm plans there yet. It will likely have subscription-based, multi-tenant SaaS offerings within the next generation SRM product suite, and my guess is that Sourcing might precede Procurement in this regard.

In my mind, Epicor Sourcing is a logical candidate to be offered as a cloud computing-based subscription/pay-per-play application. In order to get traction, Epicor might not even want to call it Epicor Sourcing but rather something like “Epicor Buyer Connect” or so.

There is quite a bit to think about here, including the potential for an Enterprise 2.0 (enterprise social software) aspect to it to monetize via industry templates or even supplier advertising. But this is only me postulating and speculating; time will only tell what Epicor will do for real here.

A separate blog post will analyze the brand new Epicor 9 suite’s functional and technical traits. Until then, what are your views, comments, opinions, etc. about the current economic climate in your region/industry and about your approach to curbing spend?

What are your best sourcing and procurement practices as well as experiences with particular SRM/spend management applications? If you are an Epicor Sourcing and/or Epicor Procurement user, I would appreciate you sharing your experiences with the product and the company.

Epicor 9: Delivering What Oracle and Others Are Yet to Achieve

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Epicor Software’s next-generation converged product suite. A similar feat is yet to be accomplished even by mighty Oracle within Oracle Fusion Applications.

The article also discussed Epicor’s accompanying “protect, extend, and converge” strategy for providing customers with a migration path choice at their own timetable and convenience. The article then went on to dig deeper and explain a number of enabling technologies and concepts within Epicor 9, starting with Epicor BPM (Business Process Management).

Part 2 then analyzed the major enabling concepts and technologies within the product, such as Epicor ICE (Internet Component Environment) 2.0 Business Architecture, which is based on Epicor TrueSOA™ and includes the Epicor Everywhere Framework™. The article also dug deeper into the suite’s built-in business intelligence (BI) and enterprise performance management (EPM) capabilities.

Part 3 of this blog series analyzes further unconventional and nifty tools and technologies within Epicor 9, and concludes the series with some insights into the product’s future enhancements.

But Wait—There’s More…

This group of extra functionality starts with Epicor Enterprise Search, which is a ”Google”-like mechanism for searching for information. This search appliance of a sort delivers secure, role-based results and permits further actions to be taken upon those search results.

As explained in TEC’s previous article “Why Enterprise Application Search Is Crucial to Your ERP System,” since search engines are a de facto means for finding what users need on the Web, why should enterprise resource planning (ERP) systems be any different? Enterprise search should get users quickly to the information they need, in the context of what they are doing, without needing to know how an ERP system works.

Epicor Enterprise Search uses Microsoft’s technology to combine both structured data (i.e., fields from Epicor’s database) and unstructured data (e.g., Microsoft Word documents, Adobe Acrobat PDF documents, Web pages, etc.) in searches. The tool can be invoked from anywhere to find information. Users do not consume a license unless they elect to link to an Epicor application (a particular session).

Related to search is the integral Epicor ECM (enterprise content management) capability that provides the ability to store and manage all Epicor application attachments as documents in Microsoft SharePoint. The module adds a level of document management system capabilities to storing attached data elements, such as version control and check-in/check-out. Epicor ECM is not a mere Microsoft SharePoint repository, since it also ensures effective management of all content and easy access to it using Epicor Enterprise Search.

Additionally, Epicor RSS Support is a nice-to-have feature that allows subscriptions to syndicated information in a Real Simple Syndication (RSS) manner. The tool allows users to subscribe to any data and have the system pro-actively push information to the user about changes. We are all used to this syndication outside ERP systems for getting timely updates, and now Epicor users can use the same easy mechanism within the application suite.

“Cloudy” Future

While the enterprise search capability is already fully available with Epicor 9, the cloud computing-based version is not yet ready, as the Azure Services Platform is not yet officially commercially available from Microsoft. Epicor 9’s business architecture (Epicor ICE, explained in Part 2) was designed to support any deployment scenario, so the product can be installed as on-premises software, hosted in a single-tenant manner, or even delivered on-demand via multi-tenant installs.

As far as cloud computing goes, the entire Epicor 9 footprint is not yet Microsoft Azure-based, but might be over time. Epicor likes Azure as the platform as a service (PaaS) of choice, since it is based on the Microsoft .NET Framework. In other words, it should be reasonably easy to move the current Epicor 9 code to the cloud.

As of today, Epicor feels that more customers will want a hybrid combination (software plus services) approach and look for suitable cloud and software-as-a-service (SaaS) applications to add value to their vast premise-based ERP investments. The applications the vendor is currently enabling for Azure include the aforementioned Epicor Enterprise Search (to make use of the utility capacity of infrastructure as a service [IaaS]) and the Epicor Everywhere Framework that was explained in Part 2 (essentially with system performance benefits from hosting the Web server in the cloud). In my view, other likely candidates for the cloud could include Epicor’s supplier relationship management (SRM) applications as alluded to in my previous blog post on Epicor SRM.

Enabling and Running “Business Without Barriers”

Another major trait that Epicor 9 brings is the product’s global and multinational capabilities, which is in contrast to most of its brethren products’ regional focus. To that end, the Epicor Global Business Management module provides a means for creating a single virtual enterprise, as well as the essential tools needed to create and maintain a “single version of the truth.” Regardless of how the customer’s business is distributed or where the business goes in the world, Epicor 9 was designed to keep it all in synch for seamless operation and total visibility of the enterprise.

Thus, the Multicompany and Global Multisite Management capabilities provide support for centralized and distributed functions and processes across distributed operations, and transactions between them. The modules support intercompany trading, centralized purchasing, global credit checking, company-wide forecasting, local pricing, and more capabilities, all in real time. The idea here is to ensure that all business entities and operations can be handled appropriately and securely, and consolidated with ease, as required.

For its part, the Epicor MDM (Master Data Management) module establishes which data will be passed between the distributed enterprise and to external systems and businesses. The module ensures that master data meets regulatory requirements, and is secure and up-to-date, all of which leads to greater customer satisfaction, operational efficiency, and overall business performance. While the MDM capability is typically found within tier-one offerings at extra cost, Epicor 9 features the stewardship of master data as standard, keeping everything in synch automatically.

Furthermore, Epicor Distributed Deployment provides a complete logical and physical business distribution across hardware and networks. Customers have the choice of deploying either centrally on a single server/single database or on multiple databases/multiple servers around the world. The distributed deployment enables the system management capability of a highly distributed enterprise to act as a single logical entity regardless of its IT deployment choices.

Last but not least, the Epicor Multilingual Data Management feature enables simultaneous support within the application for users speaking different languages. The capability facilitates companies’ growth into new regions by supporting country-specific language needs. Languages are maintained in a separate layer, making them easy to migrate between versions.

It is worth noting that Epicor 9 is already available in 28 countries and in 16 languages, and those figures are expected to increase to 40 countries and 23 languages by end of 2009. That scale of adaptability (i.e., “virtualized, always on, run anywhere” regardless of country, industry, or access device) has reportedly been achieved by Epicor “drinking its own champagne” – i.e., the combination of service oriented architecture (SOA) components, abstraction layers, Web 2.0, and other Epicor ICE 2.0 features.

It is indeed unfortunate that this colossal investment and product delivery have coincided with the current economic downturn. Epicor 9 has thus far likely resulted in somewhat less revenue to Epicor’s top line than the vendor had initially hoped.

On the other hand, Epicor staffers keep telling me that they would much rather be facing this down market with Epicor 9 than without it. The vendor started that investment about five years ago. Although it’s no fun to launch a great product in a recession, it has really helped Epicor differentiate itself compared to other vendors that do not have much new and exciting to offer.

Back to Epicor SRM

In light of my recent blog series on the standalone Epicor SRM product and given Epicor 9’s best-of-everything functional footprint approach, I was a bit surprised that the Epicor Procurement module was not included (rewritten) in Epicor 9. Epicor believes that Epicor 9 has basic requisitioning features that suffice for many of its customers.

Namely, expense and general spend management is as important today as it has ever been and is a real focus area for Epicor customers. To that end, Epicor 9 has comprehensive request for quotation (RFQ), requisitioning, and buyer workbench capabilities built-in as standard. For many of Epicor’s customers, these capabilities help them manage their supply chain operations effectively.

What these features perhaps do not do so well is overtly support customers’ corporate social responsibility (CSR)/governance, risk management, and compliance (GRC) initiatives or advanced strategic sourcing plans. Epicor Advanced Quality Management (AQM), which is an add-on module coming from Epicor Vantage, is effective at supplier conformance/compliance management and is a key element of Epicor’s overall production management and GRC capabilities. Epicor Sourcing is already available as an add-on capability to Epicor 9, which can help buyers with CSR/GRC (i.e. requiring bidding suppliers to meet certain non-price related requirements such as quality certifications, use of recycled materials, efficient transportation routes, etc.)

However, many existing Epicor customers and prospects might still want something more from the add-on Epicor Procurement product. In one of the future planned major releases for Epicor 9, Epicor anticipates it will rewrite Procurement on the ICE 2.x platform. In the meantime, I expect that Epicor’s prospective or existing customers will have to perform a standard Epicor Service Connect integration between Epicor Procurement and Epicor 9. Both the Procurement and Epicor 9 products already use Epicor Service Connect for other integrations.

Epicor Service Connect is an application (part of the Epicor Productivity Pyramid mentioned in Part 1) that orchestrates processes (workflows) at a more macro level, usually between applications (instead of within applications, where Epicor BPM plays a role, as mentioned in Part 1). For example, Service Connect would be used to bring transactions from another system into Epicor 9 (or vice versa).

The integration solution supports input and output channels of extensible markup language (XML) and Web services as well as flat-file databases and e-mail messages. Epicor Service Connect has a comprehensive data transformation capability where users can map the fields in one data entity to another and transform it (i.e., truncate, append, calculate, lookup, etc.) as needed. On the Service Connect design canvas, users can drag and drop elements and tie them together in a workflow, including application parts, decision points, and human intervention, if desired.

Mega-Vendors Warming Up to the Cloud

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depicted the three evolutionary phases (or waves) of software as a service (SaaS) and the adoption of cloud computing. The post ended with some glimpses into the future and likely implications for SaaS users.

Part 2 then explored the apparent opportunities and accompanying challenges (and painstaking soul-searching exercises) that SaaS aspirants face in their endeavors. Some concrete examples of vendors and their new strategies and solutions were presented, most notably SAP Business ByDesign.

Part 3 of this blog series analyzes recent SaaS initiatives by mainstream mega-vendors with some concrete examples.

Mega-vendors’ Hybrid Approach

Indeed, what about the vendors with immensely broad application suites and vast install bases of large on-premise software customers? Delivering applications in a hybrid on-premise/on-demand model (also referred to as software plus services), where SaaS applications are fringe add-ons to the on-premise foundation suite, is the direction many of the mega-vendors seem to be moving in. Technology infrastructure providers like Microsoft or Oracle have been good examples in this regard.

Namely, Oracle has long provided its broad Platform for SaaS and thus let partnering independent software vendors (ISVs) fly the “SaaS trial balloon” on behalf of the giant (before it takes the SaaS plunge in earnest). A panoply of now renowned SaaS vendors (Ariba, Callidus Software, OpSource, Xactly Corporation, Intacct Coporation, etc.) are users of Oracle’s SaaS Platform. (See the full list of Oracle SaaS ISV clients and their testimonies.)

Most recently, on June 30, 2009 Oracle launched its “SaaS for ISVs” monthly licensing model to offer more flexibility for ISVs that are delivering SaaS and Cloud Services on Oracle’s Platform for SaaS. This new commercial licensing model enables ISVs to purchase license and support for the components of the platform on a monthly basis. Instead of making an upfront investment for perpetual licenses, the new monthly licensing model allows SaaS ISVs to scale their investment in Oracle technology with their company growth and end-user demand.

The Oracle Platform for SaaS components are the following: Oracle Database, Oracle Fusion Middleware (OFM), Oracle Enterprise Manager, and Oracle VM (Virtual Machine). The SaaS platform leverages Oracle Grid Computing technologies to enable ISV partners to deliver SaaS and cloud-based services to multiple enterprise customers, while delivering the requirements of scalability, high performance, high availability, integration, security, and customization.

ISVs, hosting service providers, and system integrators also receive business and technology support via a designated Oracle SaaS Program for Partners. For more details on Oracle’s SaaS enabling offering, see the Oracle SaaS for ISVs questions and answers (Q&A) page and the Oracle SaaS Blog. In addition, Kevin O’Brien, Senior Director of ISV and SaaS Strategy for Oracle’s Worldwide Alliances and Channels organization has a blog with regular updates on partner activities.

Mega-vendors’ Own SaaS Applications Strategy

Microsoft’s burgeoning Software + Services and Azure Services Platform offerings are pretty much along similar lines (perhaps a bit later to market than Oracle). But when it comes to offering new SaaS products to existing large on-premise customers, traditional enterprise applications powerhouses have the following options:

* Offer complementary adjunct products to fill certain functional gaps.
* Offer complementary services.
* Expand the opportunity to a wider users audience (e.g., casual users, trading partners, etc.).

Some good examples along these lines would be the Epicor Tax Connect product powered by Avalara that is offered to Epicor’s enteprise resource planning (ERP) customers as a subscription per order/invoice, and Epicor Campaign Connect as a subscription per e-mail/survey. Oracle CRM On Demand and Microsoft Dynamics CRM Online are currently the notable enterprise applications offering by Oracle and Microsoft respectively. In addition to recently announcing Oracle Sourcing On Demand, in May 2009 the Wall Street Journal (WSJ) reported that Oracle was working on several other upcoming on-demand applications that would help businesses run sales campaigns, keep track of employees and job applicants, and manage marketing.

SAP’s On-demand Strategy for Large Enterprises

On a quite separate track from SAP Business ByDesign, an integrated on-demand solution dedicated to the mid-market that was described in Part 2, SAP recently announced the first details of its on-demand strategy for large enterprises. SAP was surprisingly and conspicuously mum about its on-demand offerings and intentions during the recent SAPPHIRE 2009 user conference.

Following suit in being dedicated to its installed on-premise customer base, on-demand software for large enterprises from SAP will consist of function-specific software applications. Available by subscription, these SaaS add-ons will plug directly into a customer’s on-site SAP Business Suite software.

The strategy was unveiled by John Wookey, executive vice president of Large Enterprise On-Demand at SAP, during his keynote presentation entitled “Next Generation OnDemand” at the Software & Information Industry Association (SIIA) On-Demand Europe 2009 conference. As a memory refresher, I should say here that Wookey was employed by SAP in late 2008, after he parted ways with Oracle and the upcoming Oracle Fusion Applications.

The keynote has already been reported on and analyzed by other analysts and reporters ad nauseum and I will try not to repeat the obvious. In a nutshell, all of SAP’s large enterprise on-demand applications will be powered by the Java-based on-demand platform SAP gained through the Frictionless Commerce acquisition in 2006.

For large enterprises, SAP currently offers the SAP Customer Relationship Management (SAP CRM) on-demand solution, the SAP E-sourcing on-demand strategic sourcing solution, and carbon cap and trade software through the recent Clear Standards acquisition. Additionally, on-demand expense management, contract lifecycle management, and human capital management (HCM, in alliance with Northgate Arinso) software is expected to be launched in mid-2010.

The on-demand offering for large enterprises is part of a portfolio of solutions dedicated to different target groups, which also includes the SAP BusinessObjects OnDemand reporting, dashboard, and analytics offerings. These are respectively Crystal Reports software, the SAP BusinessObjects Information OnDemand portal, and the SAP BusinessObjects BI OnDemand solution, which are dedicated to businesses of all sizes.

At this point, SAP is not sharing any specific information on how the recent acquisitions of the platform as a service (PaaS) provider Coghead and mobile systems provider SkyData Systems are related to its future on-demand strategy. SAP will only go as far as to acknowledge that they are a part of it.

As in the case of SAP Business ByDesign described in Part 2, there has been no lack of speculation, misinformation, and sensationalism in the news reporting on the why, what, how, and when of SAP’s on-demand plans. It might be worthwhile to read Bob Evans’ Global CIO blog post as a response to a BusinessWeek’s previous article. Other balanced and informative articles would be ZDnet blog posts by Phil Wainewright, Dennis Howlett, and Brian Sommer, as well as the WSJ blog post by Ben Worthen.

In her recent blog post, Amy Wohl takes a critical view of SAP’s still thin on-demand arsenal by saying that:

… SAP is remarkably late to the SaaS market and has chosen a unique path which I don’t think will work: they want to keep their customers continuing to invest in very expensive SAP ERP applications while buying bits of SaaS applications for small outliers, on SAP’s schedule.

SAP’s defenders (or Salesforce.com’s attackers; there is some overlap), insist that SaaS is not suitable for enterprise users. Apparently they are unaware of the fact that hundreds of enterprises are using SaaS right now and intend to use more of it in the future…

I tend to agree with Amy in part. Namely, in light of offering SAP Business ByDesign as an on-demand suite to prospects and SaaS add-ons only to its current customers, isn’t SAP acting a bit in a bipolar manner and contradicting its own “testimony

A Retail Sourcing Apartment Congenital on Experience

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Eqos's admired engagement-based adventures discussed in the antecedent allotment of this alternation (please see One Vendor's Quest to Garner a All-around Sourcing Ecosystem) were parlayed into the 2006 barrage of Eqos 3.0 and the added contempo barrage of Eqos 4.0 in May 2007. Eqos's Web-based applications advice retailers accumulate and calibration their sourcing operations by acceptance every affiliate in the accumulation chain—whether amid in Boston (US), Pretoria (South Africa), or Beijing (China)—to coact online and admission the a lot of abreast advice on the sourcing action of chump goods.

Based on best practices abstruse through its plan with such retailers as Best Buy and Tesco, the adapted Eqos artefact enables retailers to administer the sourcing action of goods, from antecedent abstraction and architectonics through to artefact specification, bid administration and assessment, landed costs estimation, packaging, sampling, testing, and final adjustment confirmation.

Hosted by Eqos (www.eqos.com), the band-aid includes analytical aisle management, workflow management, advertisement analytics, and an alerts-and-exceptions function. Pertinent information, including artefact images, can be entered into a adept repository, which reduces duplication and errors, and provides a individual appearance of the accumulation pipeline—accessible to accustomed centralized or alien users. The solution, which aswell enables the ecology of suppliers from a superior acquiescence and accident administration perspective, has always bigger its intuitiveness. It now allows all levels of designers, technicians, and buyers, as able-bodied as supplier personnel, to calmly clue the sourcing process.

Another aloft advance for Eqos came mid-2006, if Edgars Consolidated Food Limited (Edcon), the arch retail accumulation in South Africa for clothing, footwear, and textiles, called the vendor's all-around sourcing band-aid to advance supplier collaboration, abutment the amplification of its retail accumulation chain, bear the latest fashions to consumers faster, and accession basal band profitability. The band-aid has back been implemented by a collective Eqos and Accenture aggregation alive carefully with the Edcon merchants.

Operating in Johannesburg as Edgars Administration Abundance back 1929, Edcon today offers ten retail brands: Edgars (offering clothing, footwear, kitchenware, domiciliary textiles, and housewares), Jet (clothing and footwear), C N A (books, stationery, and music), Red Square (cosmetics), Boardmans (housewares, domiciliary textiles, and kitchenware), Legit (young women's fashion), Jet Shoes (footwear), Temptations (intimate wear), Prato (footwear), and JetMart (general commodity such as clothing, kitchenware, music, do-it-yourself (DIY) items, baby electrical appliances, domiciliary textiles, bloom and adorableness products, and stationery). Grouped aural the Edcon administration food and abatement divisions, the aloft brands awning assorted categories throughout the almost 1,000 food amid beyond South Africa, Botswana, Namibia, Swaziland, and Lesotho.

Eqos Today

Consequently, Eqos is currently acknowledging some of the world's arch retailers by hosting their abreast 15,000 users (which cover retailers, agents, suppliers, and added trading partners) in over 55 countries. Eqos is a professionally managed and growing alignment of about 70 employees, and the bell-ringer has been consistently profitable, with division over division growth. It has afresh accomplished concrete expansion, aperture offices in Boston, Massachusetts (US) in aboriginal 2006, and in Hong Kong, China in aboriginal 2007. This latest investment has signaled the company's charge to acknowledging added absolutely customers' sourcing operations in Asia.

Eqos's all-around amplification comes as added retailers authorize sourcing offices and strengthen relationships with agents and cardinal suppliers throughout Asia. The company's Hong Kong appointment provides retailers and their trading ally with Mandarin, Chinese, and English accent abutment beyond abundant time zones and bounded regions. Eqos supports added than 4,000 users in China alone. On a all-around basis, the aggregation manages added than 5,000 affairs a day and 100,000 user logins per month, thereby acknowledging the administration of about 38 billion dollars (USD) account of account annually.

The a lot of contempo US chump win took abode in April 2007; banker H.E. Butt Grocery Aggregation (H-E-B) called Eqos's business solutions to abutment and aggrandize its all-around sourcing and supplier administration operations, as able-bodied as to enhance its clandestine characterization offerings by convalescent accumulation alternation accord and visibility. H-E-B opened its aboriginal abundance in 1905 in Kerrville, Texas (US), and today is one of the nation's bigger apart endemic retailers, confined a ample ambit of customers. With added than 300 food in Texas and Mexico, the bazaar alternation earns revenues in balance of 12 billion dollars (USD). Now based in San Antonio, Texas, H-E-B employs added than 60,000 ally and serves millions of barter in over 150 communities. Known as an IT innovator, the banker claims to accept consistently outpaced its competitors by alms differentiated articles and casework through a array of formats.

Another trend that has played a key role in Eqos's success is that retailers are added implementing clandestine characterization strategies to advice abound their revenues. As appear in The Promise (and Complexities) of Clandestine Labels (and accustomed the alternating clandestine characterization affair appropriately far in this article), there is acutely a growing trend a part of retailers against alms clandestine (or the retailer's own) labels and brands. Consequently, a axiological analysis of the anatomy of all-around sourcing has occurred; companies are now reconsidering whether they charge agents or added middlemen at all, back added and more, companies can now plan anon with manufacturers via Internet trading exchanges. Accustomed some appear success with lower-priced abode brands, retailers in several segments, including fast-moving chump appurtenances (FMCG), chump electronics, and apparel, are accretion their focus on clandestine characterization commodity (which is about imported) to yield advantage of allowance improvements, bigger superior consistency, and cast loyalty.

For instance, banker Best Buy accomplished that it could not attempt with the brand of Sony and Panasonic in high-end, exceptional electronics equipment, appliances, and computers because of these two brands' loyal chump bases. However, Best Buy aswell accomplished that no such chump adherence exists for accent items. Therefore, the banker has appear up with its own band of competitively priced cable products, as able-bodied as added peripherals, such as alien drives, USB ports, keyboards, etc. The banker has aswell begin a alcove bazaar acceptant to clandestine characterization TV sets and chump electronics, at the low and mid-range amount points.

Eqos's Accepted Mission Enabled by a Service-oriented Architectonics Platform

Eqos's accepted mission is to become the arch provider of all-around sourcing and supplier administration solutions for the retail accumulation alternation worldwide, allotment sourcing and accretion admiral and clerks to advance time to market, access chump value, advance margins, abatement operating costs, and calibration clandestine characterization business. In added words, the abstraction is to accredit barter to access their amount of ascendancy over their all-around accumulation bases, thereby active aggressive advantage and announcement collaborative artefact and supplier innovation. This is to be accomplished by simplifying, standardizing, and ascent the processes associated with the sourcing of clandestine characterization commodity beyond the absolute supplier network, by alive collaboratively with suppliers. These processes amount from the antecedent artefact abstraction through to assembly and accumulation to the retailer's administration centers (and in some cases, into the after-sale phases).

In accession to software and support, Eqos offers hosting support, user association management, and applications administration services. These offerings axis from Eqos's accepting that over time, companies accept invested in technology to abutment their business and accumulation alternation processes. The admiration of companies to assure their investments accept to be counterbalanced with the activity and acceleration that the bazaar is demanding. This agency that anew acquired capabilities accept to accompaniment absolute IT environments in a way that seamlessly integrates advice and processes beyond both old and new systems. The abstraction (if not an imperative) is to advantage retailers' bequest action adeptness planning (ERP) and accumulation alternation administration (SCM) applications to body forward-thinking cross-enterprise processes that advance accord amid retailers and their suppliers, affairs offices, and added trading partners.

Logically, all-around sourcing and supplier accord administration (SRM) appeal ascendancy of action processes and abutting accord with suppliers (all of which may accept actual altered systems or levels of IT expertise). Thus, managing the all-encompassing and assorted retail accumulation alternation requires a simple access to workflow and activity administration that is accurate by network-wide collaboration.

The Eqos Accord Belvedere is congenital on service-oriented architectonics (SOA) accustomed the accurateness of the peer-to-peer (P2P) and SOA concepts, and underpins the absolute Eqos band-aid apartment with a adjustable architectonics that can acclimate to rapidly alteration business needs and IT landscapes. The appliance addresses all-around sourcing, artefact lifecycle management, and supplier administration business flows. It not alone streamlines affiliation with trading partners, but aswell handles centralized affiliation appliance adjustable adaptable markup accent (XML)-based servers.

Early in 2006, Eqos appear the barrage of its new belvedere release, Eqos Belvedere 7, which was primarily an "architectural" absolution with the afterward three arch areas of avant-garde development:

1. A technology move to Microsoft.NET technologies and Microsoft SQL Server 2005 database to accommodate bigger performance. Band-aid developers can use these acclaimed and boundless technologies to extend the amount capabilities of the Eqos solution.

2. Added achievement enhancements through a added adjustable abstracts schema. This new access has addressed the needs of barter that are embedding collaborative solutions added acutely into their business and accretion the cartage through them, by accouterment easier aeronautics and customization of abstracts and reports. To that end, the platform's latest absolution has decidedly bigger the scalability and has bargain demands on acknowledging accouterments by two-thirds, acceptance added abstracts and circumstantial users to be managed than anytime before.

3. Enhancements that added abridge the collaborative appliance developer's experience, authoritative these applications even added productive. Such enhancements cover a richer web user interface (UI), bigger countersign management, and quicker abstracts entry. At a abstruse level, barter accept back been able to define, customize, and administer their web pages and web UI configuration, thereby simplifying the configuration, maintenance, and amplification of appliance web sites. Further, improved, added adjustable accession and agreement options acquiesce barter to acclimate the appliance to accommodated their alteration requirements.

The appliance is attainable to added programs by appliance the adeptness and adaptability of affiliation via Web casework (see Understanding SOA, Web Services, BPM, BPEL, and More). XML is acclimated for abstracts mapping and action definitions to Web services, bequest systems, and databases, or to any added third affair system. Again, this brings us to the important adeptness of leveraging absolute applications (that is, a appearance and the abstraction of the abstracts from several disparate antecedent systems), such as adjustment administration systems, barn administration systems (WMSs), account masters, bell-ringer masters, etc., and accumulation them on a individual screen, appropriately aspersing acceptable “hard-coded” affiliation costs.

SAP's Pragmatic On-demand Approach

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Until actual afresh SAP's SAP Hosting analysis was not aggressive anon in this area, back it did not accommodate a subscription-type service. Instead, it adopted to accord banknote beggared barter a lower admission cost, giving them the adventitious to advance out the software amount over a few years through SAP Financing programs. Moreover, SAP Hosting was positioned to accommodate added complete SAP-centric solutions including operation, application, and basement management.

However, in aboriginal February, afterwards about a year of flirting with the idea, and in band with its charge to accommodate action barter with solutions that accommodated both accepted and approaching business needs, SAP appear it was accretion its on-premise mySAP Chump Accord Administering (mySAP CRM) band-aid to cover an on-demand option. The SAP CRM on-demand band-aid is advised to acquiesce ample and midsize organizations to administer sales, service, and business with an easy-to-use band-aid that is delivered anon via the Internet and is offered through a subscription-based licensing model.

In authoritative the announcement, SAP apparent its aboriginal on-demand product, the SAP Sales on-demand solution, which is advised to advice organizations administer their customers, contacts, and sales pipelines with affordable, simple-to-use, and easy-to-configure tools. Accessible immediately, the on-demand sales band-aid will be followed by added on-demand chump accord administering (CRM) offerings, including business and annual products, advised for absolution in 2006 in annual waves. The SAP Sales on-demand band-aid is offered to barter on a $75 (USD) per user, per ages appraisement affairs based on pre-defined scope. The band-aid is accessible globally, with antecedent accent options in English and German. Added language-specific versions, including French, Japanese, Portuguese, Spanish, and Chinese versions, will be formed out over the next three months or so.

The SAP Sales on-demand band-aid enables barter to rapidly accommodated acceptable sales force automation (SFA) business needs, such as annual and acquaintance management, action management, befalling and activity management, agenda and assignment management, and sales analytics, to advice companies bigger administer new and absolute business opportunities, advance generation, sales execution, and applicant engagement. As expected, these amount CRM appearance are served through a new user interface (UI) custom-built for sales and business users, alms a array of shortcuts and aeronautics aids and affiliation with desktop abundance applications for sales collaboration.

While somewhat backward to the SaaS party, and alone with basal SFA functionality for the time being, SAP claims to accept at atomic created the aboriginal amalgam CRM band-aid that transcends the on-demand (i.e., actual deployment, actual business impact, and fast user adoption) against on-premise (i.e., acerb customized solutions for differentiation, cross-functional data, analytics, and business processes, with a 360 amount appearance of the customer) debate, while amalgam with amount action solutions in both deployment models.

To facilitate this amalgam approach, SAP has alien the abandoned control model, which by accepting an added database architectural layer, combines the top availability and low accident of a single-tenancy admission with the efficiencies and deployment acceleration of multi-tenancy architecture. SAP claims to accept appropriately bridged the gap amid individual control and multi-tenancy environments, bringing calm the best of both worlds to accommodated the absolute requirements of action barter today. The bell-ringer acknowledges that barter acknowledge the efficiencies of a SaaS archetypal as begin in today's niche, pure-play offerings, including acceleration of deployment, automated software updates, and axial administering to advice accumulate costs low. At the aforementioned time, barter are gluttonous the top availability, security, and low accident that appear from the abandoned and committed assets begin in acceptable hosting or single-tenancy environments. For action customers, the ability that their systems' achievement and connected operations do not depend on the all-embracing acceptance by added barter at any level, including the database level, is decidedly important. With its new abandoned control approach, SAP hopes to accord barter the allowances of centrally-served software, while carrying a akin of independence, forth with committed technology and assets that assure a safe environment.

Thus, admitting abounding assemblage accept noticed a abridgement of functionality even if it comes to SFA (e.g., sales forecasting, advance routing, citation management, workflow management, amount calculation, added formulaic fields, etc.), SAP touts itself as the alone provider whose on-premise and on-demand solutions are based on a accepted architecture, abstracts model, and accepted UI. This should accommodate for a alteration that is simple to manage, ensure alternation of abstracts and processes, and abbreviate change administering costs.

Another affection that ability differentiate SAP is its flexibility, in that, clashing added vendors, SAP will not lock barter into abiding affairs for its on-demand offering. Furthermore, as one would apprehend (given SAP's beyond on-premise install base), the band-aid was advised from the arena up to accommodate (albeit with some tweaking) with action systems, such as action ability planning (ERP) and accumulation alternation administering (SCM) solutions, in adjustment to bear added business action beheading and advance the accuracy of chump interaction. The abstraction abaft this is to accredit a seamless alteration to on-premise deployment if the business is accessible for added able-bodied and cardinal CRM capabilities. This alternation in chump relationships and acceptance should be accessible attributable to the aforementioned abstracts model, constant user and administering data, constant customizing and configuration, constant functionality, and the actuality that the UI and database anatomy are the aforementioned amid SAP's on-demand and on-premise solutions, which is something that not abounding competitors can blow about. For instance, the brand of Salesforce.com do accept appliance programming interfaces (API) that abutment Web casework and are simple article admission agreement (SOAP) and adaptable markup accent (XML) compliant, but, accustomed the abridgement of, for example, an account adept in these applications, there are abounding decisions to be fabricated afore absolutely amalgam an adjustment administering action into these on-demand CRM applications.

SAP aswell appear that it has continued its continued and accurate cardinal accord with IBM in adjustment to accommodate on-demand appliance hosting casework for the SAP CRM on-demand solution. IBM will accumulation ability in allowance barter innovate, for example, in how they acquire the allowances of their CRM deployments. IBM will aswell accommodate safe, secure, reliable, and highly-available hosting services—based on accurate IBM eServers and DB2 database technology. The SAP band-aid will be powered by IBM's Applications On Demand Platform, which automates appliance hosting and administering to accommodate a scalable and able belvedere for active business applications.

The Impact of Web Casework on SaaS

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Nonetheless, at the accomplished level, SaaS accept to be delivered as a account aggressive architectonics (SOA) admission and accept to actualize Web services. The key account of Web casework is that it decouples the use of functionality from the supply of functionality, whereby the multi-tenant architectonics allows users to adapt their Web pages after architecture their own code. New appearance and functionality can be fabricated accessible continuously, on the fly, as best convenance appearance are articular and again fabricated available. For added information, see Understanding SOA, Web Services, BPM, BPEL, and More.

Integration via custom coding and development eventually will be accidental already Web casework become the adopted adjustment of affiliation with a back-end arrangement or an alien service, and already all functionality can be exposed. For example, retailers and manufacturers ability allegation to betrayal account or amount information, or accessible a Web account to abduction orders. There are already some bartering applications that can alarm a different, third affair appliance while attention the ambience of the aboriginal basal application. With the newer technologies available, companies can in fact address several curve of cipher to accept one appliance allocution to another.

The development of technologies, such as Web casework and adaptable markup accent (XML) affairs standards, is authoritative multi-vendor appliance interfacing added feasible. Thus, hosting companies will apparently be able to advance accepted appliance interfaces for appliance integration. However, at this stage, Web services' allotment of the affiliation pie charcoal a tiny sliver, which agency that acknowledged vendors and ASPs accept to still be able to accommodate a complete area of interfaces that abutment not alone Web services, but aswell bequest messaging protocols. To accredit multi-tenant or one-to-many service, SaaS providers can accomplice with added aeon to bear a accepted alms that is customized via activating affiliation and defended admission to assorted appliance modules, with basal customization of the application's amount logic. For the time being, the hosted software account business archetypal still applies best to applications that can be run in abreast or with limited, beneath complex interfaces to third affair applications.

This may accomplish SaaS compelling, because it has lower access costs, and if the aggregation does not apprehend amount from the software, it can consistently stop appliance it (and stop paying for it). Like on-premise licensing, this archetypal provides a abiding beck of acquirement for the bell-ringer in the anatomy of alternating account payments, but, clashing on-premise licensing, this archetypal requires the bell-ringer to accept the amount of hosting the application. In accession to getting added calmly accessed via the Web, thereby eliminating abundant of the committed arrangement costs that accomplished hosting arrange entailed, the new bearing of SaaS solutions surpasses the hosted applications of the accomplished by getting easier to access and arrange incrementally, as required, or on-demand.

Potential SaaS Benefits

The SaaS business archetypal offers several advantages to both the chump and the bell-ringer that account the eventual, connected run, college costs of this model. By purchasing a software account (as against to purchasing a software license), the chump has little or no up-front accretion costs, no accouterments or software to buy, and no abundant abutment advice technology (IT) agents to appoint and train. The amount of accretion is basically bargain to the amount of training advisers on the application, the antecedent agreement of the application, and converting or brief absolute data.

Hosted SaaS is aswell easier to get running, partially because customization is limited, but aswell because there is no accouterments to buy and no software to install. Moreover, there is no software to manage, fix, or upgrade, as this becomes the vendor's responsibility. Users get a semi-custom appliance after accepting to appoint a phalanx of IT staffers to accumulate it running. Because the bell-ringer or ASP is hosting the application, barter see alone one instance of the software. On the added hand, with the on-premise model, the software is broadcast to the chump and is installed on the customer's computers in a array of environments, out of the ascendancy of the software provider. Again, SaaS reduces the affliction of upgrades, as barter automatically abide accepted on releases, admitting spending basal accomplishment on upgrades. Thus, acceptable anchored costs about-face into capricious counterparts, back a chump alone pays for software it in fact "consumes". This may crave some new approaches to IT budgeting, but it should abate accidental software spending. Moreover, barter may alpha preferring to be able to pay-by-use, provided it is controllable. The added they can accomplish their costs vary, and hotlink to the aggregate of business, the bigger they should be able to administer their accumulation and accident (P&L) statements.

Further, these amount reductions may acquiesce the bell-ringer to allegation added for a software account than a user-based on-premise license. Additionally, the SaaS archetypal acutely lowers switching costs, and should bulldoze software providers to advocate college levels of chump achievement and bear bigger artefact functionality to ensure broader user adoption. Owing to the actuality of alone one instance of the software application, generally the bell-ringer alone has to abutment one accouterments and software platform, which abundantly reduces development costs. Vendors can action added targeted chump abutment while absorption on a individual version. A individual instance aswell agency that the bell-ringer can acquaint software enhancements one at a time, breaking the alarming above advancement aeon and eliminating the amount that aeon generates. SaaS supply gives vendors absolute time chump feedback, and adroit vendors can always adviser acceptance of their appliance and administer this acumen against connected artefact enhancements. On the client side, the lower accretion amount of software casework aswell makes these affordable for a broader ambit of -to-be customers. In particular, this affordability gives abate companies the befalling to use around the aforementioned solutions as their bigger brethren, and appropriately expands vendors' befalling to advertise their account to a greater amount of customers.

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