Wednesday, February 28, 2018

Nobody Does Vanilla

I have a granddaughter who loves ice cream.  Breakfast, lunch, dinner, whatever...whenever she sits down at the dining table, she asks for ice cream.  Chocolate, Raspberry, Cookies and Creme, Fudge, Neapolitan, Rocky Road...all flavors are good.  Except vanilla.  Put vanilla ice cream in front of the kid and she would refuse to eat it.  Even to the point of shedding tears over the thought of eating vanilla ice cream.  Because nobody does vanilla.

Ditto for enterprise software.  Nobody does vanilla.  Oh, you'll constantly hear the declarations at the beginning of an implementation project: "no customizations".  I hear that and I consider it to be an edict similar to zero-based budgeting.  It's really a statement that customizations will require justification.  And that justification usually involves preserving an existing business process.  Because nobody wants to change their business processes.  So they tweak the software to fit.  And, because we don't all do business in exactly the same way, that means nobody does vanilla.

All that being said, there is an easy path to minimizing customizations when implementing enterprise software.  Why do you want to minimize customizations?  Because maintaining customizations costs money.  In fact, it's one of the most expensive things you can do when using enterprise software.

So let's talk about that easy path.  Most implementation project plans include two or three Conference Room Pilots ("CRPs").  So stick with vanilla for the first CRP.  No customizations, no extensions, no personalizations.  Just configure the software and run the "baked in" business processes.  Then take a careful look at the results, considering where it makes sense to change your business process to fit the software as well as where to customize in order to fit your business process.  You'll be surprised at how well the vanilla business processes will fit, and how little you'll actually need to customize.

The granddaughter finally got over her dislike for vanilla.  I slipped a spoonful in her mouth while she was protesting.  And she learned that vanilla tastes better than she thought.  The same thing applies to enterprise software - once you get a taste of vanilla, you'll find it's better than you thought.

Tuesday, January 23, 2018

Testing Latency On The Oracle Cloud

One of the best things about working on the HCM Cloud Center of Excellence team at Oracle is that you learn something new every day.

I recently worked on an inquiry from a customer asking about latency testing: has anyone ever done it and, if so, how did they go about it?  In all honesty, it was a stumper for me.  I had no idea how to respond.  Fortunately, one of the folks on the team put the question out to a wider audience.  The answer that came back was pretty spiffy.

Oracle offers latency testing as a service (LTaaS?).  You can get the basic explanation on how it works here.  But a short explanation follows:

Step 1:  Log into Oracle MyServices.

Note that you'll be asked details here about the Cloud Account you'd like to test.  If you're like me, you don't exactly have those details memorized or close at hand.  No worries; See the Orange zone to the right?  Click on the "Account Details" button - you'll have the opportunity to get information on all the Oracle Cloud accounts and services tied to a specific email address.  I actually tested this; received my results via email in about five minutes.

Step 2:  Select the domain you'd like to test.  Click on your username drop-down and select "Diagnostics.

Step 3:  Click on "Test" (I've put a red box around the Test button in the image below)

Step 4:  Once the test completes, you'll see something like the following result:

Step 5:  See the "Details" selection above?  Click it to get details similar to those below:

These details show the five tests run, the file sizes for each test, and the related network latency and throughput.

Like I said, pretty spiffy.  I did this myself for my Oracle HCM Cloud environments.  Took about 10 minutes total, including getting the info on my various accounts.  So, for those of you wanting to perform latency testing on your Oracle Cloud environments, the service is the way to go.

Now, because it's important to give credit where credit is due, the gentleman who educated me on this  is Oracle's Pierre-Luc Pelletier.  Because most of us in the States will butcher the French pronunciation of his name, we refer to him as "PL".  One of my incredibly smart teammates and the source of a wealth of information.  We're fortunate to have him on the team.

So, now that the word is out, y'all can go forth and test your own network throughput.  I look forward to hearing about it.  Comment welcome.

Tuesday, January 02, 2018

Picking Your Partner

I'm not much for New Year's resolutions.  History shows I just don't keep them.  Take my first New Year's celebration, for example.  My Dad told me I could stay up to ring in the new year if I could put meaning into it by making a resolution.  My resolution was to swear off chocolate cake.  So I rang in the new year with my folks; afterwards, they asked me what I thought of it.  I responded that it would have been better with chocolate cake.  It's been all downhill with resolutions ever since.

So this year, rather than making resolutions, I decided to count my blessings.  I made a list of the things that make my life great:  personal and professional.  No question I'm a lucky guy; I came up with a long list.  Lots of things about my health, my family, my friends, my job, and so on.  And I'd like to share one of the really cool parts about my job here, because I think it has relevance for many of the folks who read my ramblings on this blog.

One of the really cool things about my job is that I get a bird's eye view of quite a few Oracle HCM Cloud implementation projects.  It's an opportunity to learn a ton from the experiences of others in terms of what works and what doesn't.  And I see what customers go through in picking Oracle implementation partners.   It can get to be quite the beauty contest with various partners promising different approaches and prices in attempting to win the business.  Evaluating partner offerings can get pretty complicated; hardly a week goes by that I don't get someone asking for guidance in evaluating partners and their proposals for implementation projects.

One indicator customers should consider in evaluating implementation partner offerings:  does the partner have consistent communication with Oracle's HCM Cloud Development team?  The Oracle HCM Center of Excellence team (I'm a member of that team) holds regular "cadence calls" with a number of Oracle implementation partners: strategic partners, emerging partners and industry specialist (i.e. Public Sector, Higher Education, Healthcare, etc.).  In those cadence calls, we talk with partners about their current projects:  the approach, the current status, issues they're working through...whatever is relevant to the success of their projects.  I'm fortunate to engage in some of these calls:  I learn a ton and get to provide some help as well.

So thinking about all this, the thought struck me:  if I were a customer picking from several partner proposals for an HCM Cloud implementation, I think one of my selection criteria might be whether or not a partner is communicating with the HCM Cloud Center of Excellence team on a regular basis.  Because there is nothing quite like getting pointers from the folks that built the software.

Happy New Year!

Tuesday, December 12, 2017

Getting Ready

I don't think it's any big secret that we're getting close to R13 of Oracle Cloud Applications.  We've been talking about it publicly since Oracle OpenWorld 2017.  Having seen R13 up close, I'm very excited to see it come to market.

But, my excitement notwithstanding, I also know that existing customers get a bit antsy in the face of an impending upgrade.  Because preparation for an upgrade is important, and that preparation requires information.  What new features come with the upgrade?  What is the impact to the way my enterprise does business?  What should I be doing to help get my enterprise ready?

Having been part of the Oracle ecosystem for more years than I care to count as a consultant, a customer, and now a member of the Oracle team, I can recall the days when it was very difficult to learn about new features and perform impact assessments.  The information was tough to come by.  And, by the time we got the information, the timeline to upgrade was too tight to perform an in-depth impact assessment.  Which lead to encountering some fairly significant surprises during the actual upgrade.

Fortunately, those days have over and done with.  Because now we have Cloud Readiness sharing the information customer and partners need to prepare for an upgrade.  You'll find that Cloud Readiness offers quite a bit of information:

  • Spotlights: videos that highlight top level messages and product themes
  • New Feature Summary:  summary description of each new feature
  • What's New:  Learn what's new in this release and how to plan your upgrade by reviewing expanded discussions of new features, including capability overviews, business benefits, setup considerations and usage tips
  • Release Training:  online sessions providing an in-depth view of the release enhancements.
  • Product Documentation:  Provides detailed product guides and training tutorials to ensure successful implementation and use of Oracle Cloud Applications.

All the information you need.  Even better, it's all in one place.  You can check it out for yourself here.  And once you've looked over our Cloud Readiness information, please let me know what you think by leaving a comment.

Monday, October 23, 2017

Let's Build Some Chatbots!

We're hearing quite a bit of buzz about baking Artificial Intelligence ("AI") into enterprise applications.  AI represents a ton of potential for this space, not the least of which is the net evolution in user interface in the form of chatbots.  As I've shared previously in this space, I have a developing infatuation with chatbots.

Chatbots are pretty cool, especially when we're talking about voice-based chatbots.  The idea of getting things done by holding a dialogue with a virtual assistant has been a very appealing design pattern almost since the inception of computers themselves.  Captain Kirk talking to the ship's computer in Star Trek, Dr. David Bowman chatting it up with HAL 9000 in 2001: A Space Odyssey, ... you get the idea, voice-based exchange has captured the public imagination for some time.

I'm having fun experimenting with chatbots and learning how they work. In fact, I wrote this entire blog post via voice-based user interfaces.  I used Siri on my MacBook Air to compose this post, then used a custom skill built for Amazon Echo to publish the post on this blog.  Yeah, I'm basking in the flow right now.

Think about interacting with a chatbot to add a new dependent to your health insurance.  Or making changes to your employer benefit package through a conversation with a virtual assistant.  Or kicking off an employee performance evaluation through a text-based conversation.

In my experimentation, I'm starting to collect HR and HCM-based use cases.  If you have an idea...some business process you'd like to execute or kick-off using a chatbot, I'd love to hear about it.  Share via the comments.  Maybe I can try building out your idea.

Sunday, October 01, 2017

Imagine If You Will - The Oracle HCM Cloud Solution Library

Foreword:  When I was young, I tried like heck to develop a Rod Serling imitation.  I was a big fan of The Twilight Zone series, including the various revivals.  Alas, I was unable to get anywhere close and eventually gave it up.  But I admittedly still love the phrase "Imagine if you will".  So it's cool that I get to use it here.  See?  Work can be fun.

Imagine if you will the opportunity to ease the implementation and use of Oracle HCM Cloud Applications through learning by example.  Wouldn't it be helpful to have examples of known good solutions to look over?   Configurations, approaches to common challenges, best the ability to upload those solutions to a non-production instance to see how they work?

Enter the new and improved HCM Cloud Solution Library – a collection of known good solutions provided in the form of Solution Packages.  User can review the contents online, download and review specific solutions, and upload those solutions to a non-production instance for evaluation.

Just in time for Oracle OpenWorld 2017, I'm please to share with you the new and improved HCM Cloud Solution Library, available right now on Oracle Cloud Customer Connect*.  Just click here and choose "HCM Cloud Solution Library" from the list under "Global Human Resources".

We've admittedly started small:  some solution packages for Talent Management and one for U.S. Payroll Elements.   But we'll soon be growing with Solution Packages for Payroll in the U.K., Canada, Latin American, and Asia Pacific.  New on the road map comes Absence Management, Benefits and Compensation.  What comes after will be determined by what we hear from Oracle partners and customers.

So what's in a Solution Package?  First, an annotation providing a technical description of the business objects and data provided in the solution package. Second, the actual data itself, in a file format that supports the relevant upload tool.  For example, the Talent Management solution packages are in a file format that's ready for the upload feature in Functional Setup Manager.  The U.S. Payroll Elements solution package is in a format ready for the Payroll Batch Loader.

You'll also note in the user interface that we've included a "Solution Library Overview" link.  That document provides deeper detail about what the Solution Library is and how to use it.  We've also include the HCM Cloud Application release number for each solution package.  And, yes, we'll be updating those solution packages as new releases become available.

Our hope is that, by providing examples based on known good solutions, we'll help increase the realization of the SaaS promise for "better, faster and cheaper" experiences in implementing and using Oracle HCM Cloud Applications.

So check it out.  And feel free to click the "Share Your Feedback With Us" link to let us know what you think.  Or you could just hug the comments here.

*If you're not already a member of Oracle Cloud Customer Connect, may I suggest that you get it done now?  Signup is quick and free.  There's a wealth of information, tips and tricks from Oracle people, partners and customers.

Tuesday, September 19, 2017

Some Numbers on SaaS

It's money that matters
You know that it's true
It's money that matters
Whatever you do
               --From "It's Money That Matters" by Randy Newman

So we've just gotten through earnings announcements for several SaaS companies, including my own employer (Oracle).  And as the numbers come out, I see lots of different voices interpreting those numbers inaccurately.  Because SaaS has an entirely different business model from that of the legacy enterprise applications market.  So let me throw out some numbers on SaaS for your consideration.  

Before I jump into numbers, I should note that all of the numbers provided here come from one of my favorite industry reports:  the annual Pacific Crest Securities Private SaaS Company Survey Results.  I'm using the most recent issue, which came out in October 2016.  So I won't be disclosing any special Oracle margin numbers...only industry averages.

Now about those numbers:

  • New Customer Acquisition Cost:  The average industry cost of acquiring a new SaaS customer is around $1.12 for every dollar of revenue from the initial subscription.  So wait a second.  We're losing 12 cents for every revenue dollar received from a new customer over the life of their subscription?  Why would anyone in their right mind want to do that?  Read on and you'll see...
  • Upsell Customer Acquisition Cost:  The industry average for acquiring a customer through upselling (roughly defined here as selling SaaS products from a different application suite or pillar) is about 22 cents for every revenue dollar realized.  Now we're talking!  That leaves me a margin after CAC ("Customer Acquisition Cost") of 78 cents on the revenue dollar.  But it gets better...
  • Expansion CAC:  The average CAC for expansion selling (expanding the customer footprint through selling additional products and services within the same application suite or pillar) is 20 cents on the revenue dollar.  Wow, a margin of 80 cents on the revenue dollar after CAC...let's book that trip to Vegas!  But now let's look at the real winner...
  • Renewal CAC:  The CAC for an existing customer who simply renews their subscription is roughly 12 cents.  That's right, an 88 cent margin on the revenue dollar after CAC!
Before we get too giddy with our visions of wealth beyond our wildest dreams, keep in mind that we still need to cover operating costs, R&D, and other traditional P&L costs from those margins.  But I'm disregarding those costs for the purposes of this discussion.  Head to your local junior college for an introductory course in Accounting if you want a feel for this stuff.

So when you hear about or read over financial results from SaaS vendors or SaaS product lines, keep in mind the following concepts:

  • Grow in new customers (usually expressed as new customer or new account revenue, both in dollars and percentages) is a great leading indicator of potential future profitability, but it's more than likely a drag on margins in the present.  As we see above, acquiring new customers is expensive.
  • The key to determining how well a company will generate profits or earnings in the short term is to look at the trend for upsells, expansion sales, and customer renewals...especially the latter. Renewals are often expressed through a rather negative metric...Account Churn.  The lower the Account Churn, the higher the renewal rate.
  • Working through the logic here, you may come to the conclusion that a SaaS company or product line could become extremely profitable with minimal growth in new customers.  And you would be correct.  So long as the growth in new accounts roughly replaces the accounts lost in churn, one can still do quite well by simply tending to your current stable of SaaS customers.  Because the money is in the renewals, the upsells, and the expansion sales.

The next time you read an annual or quarterly report, or when you see a press release touting growth through acquiring new customers, your immediate thought should be something along the lines of "That's a nice indicator of future earnings potential.  But before I take that too seriously, tell me about your customer retention.  How is your renewal rate?  How much revenue growth are you realizing from your existing customers?"  '

This is why having a Center of Excellence focused on customer success is so very important in the SaaS world.  Because successful customers are happy customers.  And happy customers renew their subscriptions.  And folks, that's where the profits are found.  That's where the money is.  And it's money that matters.