This week has seen diginomica team members in Orlando for SAPPHIRE Now and San Jose for NetSuite SuiteWorld. I was in San Jose at the SuiteWorld event but had contact with colleagues over in Orlando. Which was better? That depends on your point of view. Holger Mueller, VP Products at NorthgateArinso provides his candid assessment of the keynotes delivered on day one and day two. He scores day one to NetSuite and day two as honors even. I agree based upon what I saw and heard from both locations. However, it is the nuance from people on site that matters more.
The video above was recorded at the end of day one at SAPPHIRE Now. It provides an assessment of co-CEO Bill McDermott’s opening keynote. It’s interesting because the cultural differences between a US and non-US audience are immediately apparent. US types loved the sporting references, while non-US types felt they had missed out. John Appleby‘s comment is acerbic, if accurate: “There was a lot of male testosterone on the stage.” The underlying message though was that while glitzy and designed to give customers the ‘we care’ message, it failed to talk to the kind of meaty content that people expect at these events.
In contrast, I was far more satisfied with what I saw at SuiteWorld where customers were brought on stage in largely unscripted mode while product direction was clearly laid out.
You can argue that NetSuite has a lot more to prove to its customers than SAP because it is far less mature as a business. That would be a misreading of events. Advances in technology allow vendors to bring product to market much more quickly than they could in the past. Even so, NetSuite revealed that it has taken two years to get to the point where it can release a modestly complete manufacturing solution. In short – there are no short cuts if you want to be talken seriously.
More telling to me was the jibe that Zach Nelson got in early: ‘We’re here talking about applications, they are talking about a database.’ It clearly riled SAP. Time and again I saw Tweets quoting various SAP executives disavowing that epithet. What does that tell you? I am surprised that SAP rose to the bait. Rather than simply explain SAP HANA’s capabilities AND provide solid examples in applications, it fell into the same trap it always fall into: act defensively.
My sense is that SAP is concerned about NetSuite. That is a new dimension to the market and one that will encourage customers to think beyond short listing SAP as a given. As one analyst told me: ‘Other than ByDesign, my interest in SAP is diminishing.’ When pressed for a reason, he said that customers are no longer asking for on premises solutions but those built upon cloud technologies.
Equally telling was the fact that key influencers like Vinnie Mirchandani, Brian Sommer, Paul Greenberg, Estaban Kolsky and Ray Wang chose to attend NetSuite for day one rather than SAPPHIRE Now.
Hearing that, Zach Nelson must be jumping up and down. But before cracking the champagne I believe the company needs to accelerate the user experience refresh that is clearly underway. This is important because by everyone’s reckoning, the UI is looking decidedly stale. I’d also argue that NetSuite should be far more aggressive in its messaging about the extent to which it protects its customers against the ever present security threats. Nelson told me that it is always a balancing act and I got the impression that the company would rather not draw attention to this topic. That’s a mistake.
Without going into the details (Nelson asked me to be vague), NetSuite’s security armor is impressive and should easily stand the probing of the most intrusive (sic) negotiation lawyer.
All in, SAP should be concerned about the new boys (and girls) on the block. Older vendors often struggle to reinvent and SAP is no exception. Trying to look hip and cool is great for the one day of the year when a company gets to strut its stuff. The reality is when we see those same cool use cases repeated over and over again. For its part, Netsuite should not be too smug. It might have won the battle of the conferences but it is still a small vendor in comparison to others. It still has much to prove.
Dennis Howlett has been taking the buyer's perspective in analysing application vendor offerings for more than 22 years following a 20 year successful career in IT and finance related roles. 'Never knowingly under opinionated,' Howlett takes strong positions in the interests of getting to the truth of what drives customer value.
6. Lastly , competition is good for whole ecosystem . I wish nothing but the best to net suite . I firmly believe all competitors should be respected by the leader ,but not feared . Maybe some day in future - net suite might do something as fantastic as sap did with Hana . But given they even didn't have multiple books till now - I am not holding my breath for such an event to happen in near future
For the comparable functionality and volume of data in R/3 , SAP had real time reporting too ! SAP allowed way more customization than most vendors - for good or bad . But that should not hide the fact that there were several standard reports too in each module of SAP for decades .
@Vijayasankarv We can go around and around this forever but times have changed and we now see far more $N in deals - and especially those that are 2-tier (hate that term) in nature. We pressed on the extent to which they are making more replacements. It seems divisions are starting to move and using those oppties to get out of customizations. Will be a slow burn.
4. While there is a definite shift to cloud , there is no real shortage of on prem ERP projects . It is rather misguided to think on prem ERP is in heavy decline.
5. About influencers - you stayed at net suite event, and your partner Reed covered sapphire . Vinnie does not cover sap as he publicly stated . Ray and Brian spent a day at net suite and then flew to sapphire . So why is this "telling"? Analysts dividing time across two conferences are not that dramatic
@Vijayasankarv Au contraire....so the fact SAP core apps declined 9.2% last qtr is not a 'heavy decline?' Let's see what happens next qtr.
Depends on your perspective. In past years, companies like $N would struggle to get the time of day so to see folk mentioned turning up on day 1 was a surprise. To me. I guess they felt those peeps would have more to say.
1. I don't think Appleby meant "testosterone" as an acerbic comment - he used the same words when we spoke and I got the impression it was just a light hearted comment on the number of sports people on stage
2. Not sure what you were expecting as meaty content that customers like . The guys on stage were happy customers explaining very powerful use cases . We're you expecting some business suite type of conversation ?
3. Nothing amused me more than Nelson making that remark . He is talking about applications decades after SAP solved that problem. I am surprised they didn't even have the ability to run parallel ledgers till now . That is tablestakes in SAP .
@Vijayasankarv You'd have to be a Brit to 'get' Appleby's tone. I guess it's a matter of taste and I have to say that co-founder doing a quasi Batman impression was a tad cheesy but I am not convinced that attendees go to these things to be entertained from the get go. Or maybe I'm just old fashioned.
You seem to have made the point for me but heh...
BTW - thx for sticking with trying to make comments using an iPhone.