Tag Archives: software

A Quest for Vendor-Agnostic ERP Implementation Partner Selection and Value Realization

Ralph Billington Blog

Ralph Billington, Managing Director –  

Enterprises expend significant resources to evaluate ERP packages and select the one best suited to the specific needs of their organizational structure and business requirements. Ironically, however, they don’t take an equally analytical approach when defining their implementation strategy, selecting their provider or determining and defining the value contributors the program has to deliver against to be a resounding high five.

That’s a problem. First off, implementation comprises the lion’s share of an initiative and determines the ultimate success or failure of an ERP initiative. Mistakes made during implementation account for most of the value leakage that takes place over the long term. In this context, to prioritize package selection over implementation is a bit like agonizing over what kind of hammer to buy when you actually need and should select a carpenter.

More importantly, the approach that most enterprises take to selecting a provider to manage the implementation is inherently flawed, and contributes significantly to the consistent underperformance we see with ERP programs. The problem is that client organizations rely on providers and integrators that have a vested interest in recommending a specific solution that, while it appears focused on increasing the value of the outcome, is in fact driven in part by maximizing the integrator’s involvement and fees. This dynamic leads to over-selling of package capabilities, overselling the business impact the program will deliver (specifically with regard to pre-configured solutions) and a glossing over of business and process challenges that need to be addressed. (“That can always be done on a change order, right?”)  The result is often unanticipated customization, significant cost overruns, scheduling delays and lack of ROI.

The alternative is to engage an independent third party that doesn’t have a stake in the outcome and has no incentive to sugarcoat or downplay the potential obstacles and challenges that may occur during implementation. An honest assessment upfront can prevent many unpleasant surprises down the road.

Good Microsoft Customers Beware

Louis Pellegrino Blog

Louis Pellegrino, Director – 

If you’re a loyal Microsoft Enterprise customer, you’ve likely exercised your option to leverage volume licensing agreements. You’ve diligently taken advantage of new offerings, and your environment is a poster child of Microsoft products.

Be careful.

The trouble is, Microsoft account teams are assigned aggressively high bars to grow revenue. In Microsoft’s view, there’s no such thing as a saturated customer. More specifically, there’s no such thing as a customer who shouldn’t produce more revenue this year than the year before.

If you already have a significant installed base of products, your Microsoft account team will likely focus on selling you myriad high-edition value-added products, or they will pressure you to convert your on-premises workloads to their Cloud Services.  If you dutifully sign on and acquire these upgrades, or if you move hastily to online, there’s a good chance you won’t use many of the features, which means you’ll be buying capability you don’t need.

If, on the other hand, you push back and say your existing product suite is adequate for your needs, you will very likely become targeted for a software audit aimed at identifying unauthorized use of licenses and assets and extracting significant fines and penalties.

While audits of enterprise software customers were traditionally an exception, that has changed, and today all software publishers increasingly rely on audits to fill revenue pipelines depleted by declining sales of new products.  For large and established Microsoft customers, the risk is especially high because, by virtue of their size and scope, they are by definition targeted to produce significant revenue growth.

Customers can regain control of their relationship with Microsoft and other software providers by demonstrating compliance and complete and detailed oversight of their software assets.  Equipped with a detailed inventory of volume licensing agreements, deployment landscape and purchase history, you can respond to an audit with confidence, strengthen your negotiation position and improve your relationship.

Check out a recording of a recent Alsbridge webinar that discussed how customers can respond to Microsoft licensing strategies.

WTF(S)?

Questions, questions, questions... the Concept photo

Jeff Seabloom, Managing Director – 

I’ve recently been involved in a number of Unlimited License Agreement (ULA) negotiations where the contracts were full of arcane, intricate and complex terms and conditions – nothing new there, that’s the nature of the beast. However, I was struck by the fact that on three occasions, my team and I – all industry veterans – encountered no less than 20 items that we had never seen in an agreement. What was more surprising was that in two instances we discovered specific terms that directly negated or contradicted other specific terms – within the same agreement.

This led to several hours of consideration and head scratching, after which we deemed the items in question as falling into the category of “Why the Final Signature?” (WTFS). In other words, why bother? Why spend days and weeks pouring over the minutiae of a complex agreement in the belief that this attention to detail is necessary to build a partnership that benefits both parties – only to learn that the agreement is so one sided to the provider that very little “partnering” is considered.

Existential musings aside, the answer is that the Ts & Cs in today’s contracts have to be painstakingly analyzed, parsed and understood in all their complex glory.  Otherwise, clients are likely to have those minutiae used against them later in the contract term.  As hardware and software agreements – particularly ULAs – become increasingly impenetrable, clients need access to narrow, deep and specific expertise around individual vendor licensing strategies and sales techniques.

Lacking that expertise, clients are at risk of signing bad deals. One trap is that the myriad intricacies and multiple price points in the contract come back to haunt you. Customers will sign on to a ULA only to learn after the fact that the additional licenses they expected to acquire may be excluded from the umbrella agreement. Or they’ll realize that vague language on assignment and usage – such as, for example, how “North America” is defined – doesn’t mean what they initially thought.

This “fine print” strategy of the ULA works hand in hand with the “you’re getting a special deal” approach. Vendor account teams plead year-end management pressure to make their numbers, and convince clients they have “leverage” to drive a favorable agreement. The ULA   that is offered upfront as a prized concession loses its luster downstream when specific language and clauses turn out be not an advantage or premium after all.

Bottom line: Negotiating a software contract is a challenging proposition under the best of circumstances. Proceeding without technical and contractual expertise and specialized knowledge of vendor strategies makes it downright scary.

Oracle’s New Sales Strategy: Battleship in a Bathtub?

Battleship in a Bathtub

Jeff Seabloom, Managing Director –

Is Oracle serious about changing its sales culture to a more customer-focused approach? One that helps customers leverage the full suite of Oracle solutions? More specifically, will the software giant abandon what one customer recently described as a strategy of “constant attack” from multiple sales people pitching multiple products?

It’s a tall order. Commission-based revenue chasing is a longstanding problem for Oracle, one that has only gotten worse as the product portfolio has expanded. By its own admission, Oracle has on a regular basis shifted, changed, reorganized and retooled its sales strategy, teams and methods – to the point that the process has become something of an annual rite of spring.

Will things be different this time? Incentives based on a regional and vertical focus can go a long way toward improving the reward structure and reversing the practice of throwing lots of stuff against the wall and seeing what sticks. The Key Accounts Program can also help, but should become a catalyst for the norm, rather than special treatment proffered on a handful of strategic accounts.

On the other hand, the current executive structure and supporting organizations are non-traditional Oracle, and many top sales executives have a background in hardware and, arguably, commodity sales. In the scramble for revenue during the past few years, Oracle has lost many talented professionals who were experts at complex solution-oriented sales and who were true advocates for the company and its vision. The gap left by their departure remains difficult to fill, especially when a culture of commission chasing continues to prevail in many quarters.

Ultimately, while Oracle’s leadership may be well intentioned and committed to driving a more customer-oriented sales strategy, the reality is that this is a very large company with a deeply entrenched culture. Think battleship in a bathtub.

Alsbridge Reveals New “Game Changing” Tools for More Effective VMOs

There is an emerging set of tools poised to save the day by improving the overall effectiveness of Vendor Management Offices (VMOs) for enterprise clients everywhere, says Alsbridge, Inc., a benchmarking, sourcing and transformation advisory firm. The firm will share insights on the latest software tools to improve VMO efficiency through its eSeminar, Software Superheroes: New Tools Saving VMOs, on September 05, 2013, 12-1 p.m. ET.

Alsbridge research indicates, anywhere from 40-70 percent of the original cost savings identified in the business case of outsourcing can be lost if an effective vendor management office (VMO) is not established. The eSeminar will discuss how enterprises can become ‘Software Superheroes’ by making their VMOs more effective through game changing software tools.

Craig Nelson, managing director at Alsbridge will co-present the eSeminar with president of SirionLabs, Claude Marais, discussing the following topics:

  • The latest and greatest tools available to increase the effectiveness of VMOs
  • What can be expected from the tools
  • Where the value in the tools exists and how to achieve software superhero status

There is an emerging set of tools poised to save the day by improving the overall effectiveness of Vendor Management Offices (VMOs) for enterprise clients everywhere, says Craig Nelson. “However, these tools can only be proven effective if clients play the part of the trusty side-kick by providing the appropriate management support and process changes needed to succeed,” added Nelson.

To register for the eSeminar, go to Software Superheroes: New Tools Saving VMO registration page. Space is limited and early registration is recommended.

About Alsbridge Inc.

Alsbridge is a global consulting firm that provides data-driven sourcing advisory and benchmarking services for IT, Finance and Sourcing executives.  We’ve helped hundreds of companies reduce costs and get more value from their vendors.  Our experienced consultants leverage proprietary tools and information databases to identify and engage the optimal vendors for your situation, negotiate best practice terms at fair market prices, and improve the way you work with your vendors.  Alsbridge clients utilize the most cost effective and value added sources globally for IT infrastructure services, hardware and maintenance, network services, software and maintenance, application support and development, business processes and cloud services. Alsbridge was ranked the #1 outsourcing advisor in the world by the International Association of Outsourcing Professionals (IAOP) based on the value delivered to clients.  This commitment to delivering value to our clients has made Alsbridge a distinguished member of the 2010 Inc. 500 fastest growing privately held companies in America.

About SirionLabs

SirionLabs creates the next generation of supplier management technology – an emerging enterprise application category focused on realizing value from the procurement of complex services and capital projects. Their technology is designed to manage such global sourcing through its entire lifecycle and to generate insights into performance data across industries, services, clients and suppliers. Their patent-pending data algorithms allow suppliers and their clients to compare and view performance data spanning various services, geographies, and entities on a single dashboard.

EDITORS/WRITERS: Journalists are welcome to register for and participate in Alsbridge eSeminars.