Packaged Software Business A System Integrator Point of View
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1 d Software Business A System Integrator Point of View T Tomas Nyström Accenture Company Background Business Consulting Systems Integration Applications Outsourcing IT Infrastructure Outsourcing Business Process Outsourcing Global Over people Turnover US$13,67 billion In Finland we are 700+ Accenture Traditional consulting Accenture Services Outsourcing / Application Management Accenture Technology Solutions Hard core technology knowledge Mobile lab During the last five years Accenture has delivered almost projects to over 4000 clients. Every fourth hour (on average) an Accenture implemented IT system is taken into productive use.
2 Tomas Nyström Started studies in HUT in 1991 Worked part time during studies with programming Major in computer-systems, minor in industrial economy Master s Thesis for Nokia about Software Methodology Graduated in 1997 and joined Accenture, now with a 7½ year work history consisting of: Custom & package delivery experience Consulting & outsourcing delivery experience Offshore & onshore delivery experience Pre-sales & sales & delivery & maintenance experience Developer, Team Lead, Architect, Project Manager, Program Manager experience Currently Senior Manager in the Global Architecture and Core Technologies group (GACT) leading a Product Development Offshore engagement. Definitions Ready-to-run Configurable? Custom Coding?
3 Degrees of and Custom MS Word MS Project BasWare eflow SAP ERP Cognos BI BEA WLI JBoss Server Oracle DB Struts Log4J Semi-s Building Blocks Custom J2SE C Assembler Custom Typical Solution Areas ERP Enterprise Resource Planning Financials HR SCM Supply Chain Management Logistics Production Planning Optimization CRM Customer Relationship Management Sales Pricing Customer information Call centers BI Business Intelligence EI Enterprise Integration But But it it is is not not always this this clear.... especially if if you you look look under the the hood..
4 Typical Scenario: What is Sold vs What is there Offering A CRM CRM Offering B SCM SCM Offering C ERP ERP Application A Application B Application C Application D Technology A Tech Tech B Technology C Business Case for Solutions Standardized functionality that fits the need Proven track-record equals less risk. Core processes are standardized across industries (e.g. Finance). Industry processes are same across geographies (e.g. Retail). Legislative impact on some processes force local focus (e.g. HR). Time-to-implement As the project only needs to focus on integration the effort required is less than for a custom projects. Cost of implementation Licence cost is less than cost of work to achieve equivalent functionality as custom solution due to economies of scale. Upgrades Maintenance and support available (for a fee). No need for big internal development organization. Skills For larger packages experience is available on the market. Custom
5 Typical Functional Expectations for a Provides best-practice functionality Allows for configurability through built-in tools Organization hierarchies Chart of accounts Workflows and a lot more Is user-friendly to use and has a consistent look and feel Has a proper functional reference explaining the functionality and more detailed logic of the application. Typical Technical Expectations for a Provides reporting customization. Provides API:s and SDK:s for integration and add-on development. Provides built in hooks for custom extensions. Has built in user management and security (authorization and authentication). Some packages provide source code for core modifications while others prefer the black box approach. Data storage is usually abstracted and direct DB access is not allowed. Performance benchmarking is available to do HW sizing. Operational best-practices exist. Upgradeability is guaranteed. Has support for archiving or data retiring. Application architecture supports high-availability.
6 Typical Issues with s Does it really meet the requirements? Special purpose needs exist in all organizations. A package project is very much an exercise in self-discipline. Temptation to do unsupported changed and thus end-up with potential issues with upgrades. Most projects run with a zero change policy. Resistance of change A custom application could be tailored to fit the current situation to a very exact degree. However in most cases the application of best practice processes makes sense and is a benefit resulting in e.g. Process changes New reporting structures formats New metrics IT department resistance Especially if current application set is created in-house Typical Implementation Scenarios Rationalization Process Harmonization AA DD BB EE CC F F AA EE
7 Support from Vendors Support sites with FAQs, knowledge bases, news groups, documentation, Support function to solve problem issues Go-live checks Project audits Training classes Certification service.sap.com
8 Market Opportunity $1 trillion IT spend in 2005 HW 38 % Software 21 % License Fees $5 billion new license a year + maintenance fees Services 41 % Integration Integration is a larger cost than licenses (on average ~10 times) Accenture Organization Market segmentation Skill Skill segmentation E.g. SAP and Oracle skills E.g. CRM and BI skills
9 Alliances Almost all package vendors have Alliances with systems integrators. The purpose of the alliance is to create additional sales opportunities on one side and additional integration opportunities on the other side. A typical alliance considers the following: Sales alliance Exclusivity in a geography and market segment Training benefits Sales kick-back Access to free software Access to early-access information The Future? Both custom and package vendors are now turning the attention to processes. This is very much driven by the emergence of service oriented architectures The end state will be that package projects will be less package and custom projects less custom.
10 Thank You for Your Attention! Any questions?
Customer Centric Software Project Management Tomas Nyström 21.4.2005
Customer Centric Software Project Management Tomas Nyström 21.4.2005 Accenture Company Background Global Over 100 000 people In Finland we are 650+ Accenture Traditional consulting Accenture Services Outsourcing
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