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Monday, December 18, 2006

Project management: the missing discipline

Tom Mochal, writing for Tech Republic, has a good piece on why organizations fail at project management. His top reason? Organization don't know how to implement culture change. He writes:
Most organizations don't know how to manage culture change in general and project management in particular. You can't just train people and turn them loose. You can't just buy MS Project and turn people loose. You have to have a long-term, multi-faceted approach to managing culture change. It takes hard work and resources. Most organizations aren't committed to focus on the culture change long-term, and they don't want to spend any resources to do it. Is it any wonder then, that six months later, project management deployment ends up in the trash pile of culture change initiatives that have all failed in the past?
I would state Tom's reason more generally: project management and change management are not well-developed disciplines in many organizations. Through many years of experience, most managers are good at managing day-to-day operations. The most successful are good at budgeting, hiring, motivating subordinates, maintaining relationships, organizing the work, and managing performance--in other words, all the things it takes to keep a functional group operating effectively.

But what happens when an organization is undergoing change? The skills that are needed to manage ongoing operations are not the same as those needed to change those operations. For example, managers who only work with day-to-day operations probably do not have basic project management skills such as defining objectives, breaking down the project into discrete tasks and activities, planning and estimating costs and schedules, identifying the critical path, analyzing risks, and developing contingency plans.

Why ERP initiatives fail
This explains why many enterprise system projects such as ERP fail. Although selecting the wrong system is a sure fire path to disaster, ERP projects generally do not fail because of software problems. ERP initiatives fail because organizations think that ERP is a computer project. But ERP's use of computers does not make ERP a computer project. It is an organizational change initiative. If successful, it will change how many groups and individuals do their jobs.

After hearing war stories from other companies with ERP, executives may understand that ERP projects are difficult to manage. But many do not understand that project management, as Mochal points out, is more than just a set of tools such as MS Project. It is about dealing with the human and cultural issues surrounding change and getting people to accept and implement change. It also takes special skills in change management such as recognizing cultural and political impediments to change, identifying organizational incentives that encourage wrong behavior, team building, negotiating, and resolving conflicts--skills that many otherwise good managers do not have, because they do not have to lead the effort for change very often.

How can an organization be successful in project management? First, by recognizing that project management is not a core skill of most managers and appreciating the change management aspects of project management, as I've pointed out. Second, by treating project management as a formal discipline within the organization.

The project management office
Many companies elevate project management as a discipline by establishing a project management office (PMO). The PMO can function as a center-of-excellence: training, advising, and coaching line-of-business managers in project management. Or, it can function as a home for the project managers themselves, assigning project managers to projects in the business units as needed. Or, it can be a combination of the two.

Regardless of how the PMO is organized, the main point is that project management, including the cultural elements of change management, must be recognized and developed as a key discipline in the organization.

Related posts
Computer Economics: Staffing for Project Management and the PMO

by Frank Scavo, 12/18/2006 09:54:00 AM | permalink | e-mail this!

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Thursday, December 14, 2006

Has spam volume doubled, or does it just seem so?

A quick check of my spam folder over the past two or three months reveals a whole lot more spam than I was getting earlier this year. Promotion of penny stocks seems to be a recurring them, sometimes with ten or more spam messages promoting the same pump-and-dump scheme.

We've known that botnets (highjacking of thousands of individual PCs into a network of drones) has been growing as a channel for spam distribution. Now, it appears that a new trojan, dubbed "SpamThru," has commandeered over 70,000 PCs into another botnet, under direction of Russian hackers.

But whether the volume of spam has increased, or merely the percentage that evade spam filters, is an open question. Ferris Research, quoted in a Datamation article, believes that spam volume only increased 20% in the fourth quarter of 2006 to date, while the percentage reaching the inbox doubled. Techniques being used by the more sophisticated botnets include use of images instead of text and more compliant response to recipient mail server requests for greylisting.

Unfortunately, spam volume is unlikely to decrease as long as the economic incentives are there. Spam costs very little to send, and even if only a tiny percentage of recipients respond, a penny stock scam can still pay off to the spammer.

The soon-to-be-results of a Computer Economics survey on IT security threats shows that of all categories of threats, IT security personnel consider spam as one of the most serious.

Like the war on terror, it may never be possible to declare total victory in the war on spam. But it is possible to minimize its impact. A recent Computer Economics study surveys the relative effectiveness of four types of spam-blocking solutions.

by Frank Scavo, 12/14/2006 11:20:00 AM | permalink | e-mail this!

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Monday, December 11, 2006

Rumor mill: Oracle looking at JDA/Manugistics?

Take this one with a grain of salt. A Spectator reader tells me that he has heard from two unrelated sources that Oracle may be looking to acquire retail industry software vendor JDA.

If you've been following M&A market you know that about eight months ago JDA acquired Manugistics, one of the leaders in the supply chain management space. My source also tells says that he has first-hand knowledge of dissatisfaction among ex-Manugistics sales reps.

Would such a deal make sense? In its battle agains SAP, yes. A JDA deal would give Oracle one of the leaders in the retail industry, complementing its Retek acquisition and countering SAP's nascent development in this industry. It would also give Oracle one of the strongest players in the supply chain management space, countering SAP's gains with its APO system.

If you've got any confirmation of this rumor, or a contrary thought, leave a comment or drop me an email.

Related posts
Manugistics to be acquired by JDA
SAP walks away from Retek deal
Oracle beefs up retail offerings with ProfitLogic bid
Brawl continues between Oracle and SAP

by Frank Scavo, 12/11/2006 03:36:00 PM | permalink | e-mail this!

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Wednesday, December 06, 2006

Comparing Oracle's on-demand business with Salesforce.com's

Salesforce.com is the vendor most often identified with the trend toward software-as-a-service (SaaS), otherwise known as software on-demand. But in terms of size, it would appear that Oracle has surpassed Salesforce.com in the on-demand segment. This is a recent development that has only come about through Oracle's acquisition of Siebel, and its on-demand offerings, which complement Oracle's own work in the on-demand segment and its offering of its other products through the on-demand deployment offering.

Let's look at the numbers. Earlier this month, Oracle claimed over 2,200 customers with 1.7 million users of its various on-demand offerings. In the most recent quarter, this segment of Oracle's business generated $125 million, nearly 50% higher than the same quarter last year.

Last month, at Oracle's OpenWorld conference, CEO Larry Ellison claimed that Oracle's on-demand business is the same size as that of Salesforce.com. Actually, Larry was being conservative. If Oracle's quarterly revenue from its on-demand business was $125 last quarter, that would put it ahead of Salesforce.com, which has trailing 12 month revenues of $444 million, or $111 million per quarter. Furthermore, Oracle does not count license fees in its on-demand revenue numbers, whereas Salesforce.com's revenues are "all-in" numbers.

Part of the reason that Oracle is not recognized as much as an on-demand leader is that it gets there through a number of on-demand offerings, whereas Salesforce.com basically does it with a single offering. Oracle's offerings include:
  • Oracle's traditional E-Business Suite, which it offers as a single-tenant hosted offering in its own data center in Austin, TX

  • Oracle On Demand for Siebel CRM, which is a hosted deployment of Siebel's traditional CRM system

  • Siebel CRM On Demand, which is its multi-tenant offering, similar to Salesforce.com's

  • PeopleSoft Enterprise On Demand, a hosted version of PeopleSoft's Enterprise system

  • A set of retail on-demand offerings, including hosted versions of Retek, ProfitLogic, and G-Log logistics
Computerworld has an edited transcript of an interview with Juergen Rottler, head of Oracle's on-demand operations that gives more insight into what Oracle is doing with software-as-a-service.

An interesting point from the Rottler interview: Oracle claims that large Fortune 100 companies showing more of an interest recently in Oracle's on-demand offerings, which are often thought of as having greatest appeal for small companies. If large companies are increasing their adoption rate, it shows that large firms must feel there is a strong business case for SaaS.

Related posts
The Business Case for Software as a Service
Major ERP vendors battle Salesforce.com for SaaS mindshare

by Frank Scavo, 12/06/2006 08:58:00 AM | permalink | e-mail this!

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Tuesday, December 05, 2006

Payback begins from SAP's Netweaver strategy

SAP is beginning to reap the benefits of its service-oriented architecture (SOA), dubbed Netweaver. This week, SAP released the first group of enhancements to its mySAP 2005 system. The enhancements include new upgrades to SAP's human capital management (HCM) and financial modules, along with new functionality for the retail and manufacturing industries. The benefit to customers? The new enhancements can be applied piecemeal.

Previously, SAP rolled out major new functionality only once every 12-18 months as part of an across-the-board version upgrade. The problem with this approach, which is fairly standard among ERP vendors, is that it requires a major implementation effort on the customer's side. If the customer is only interested in a single enhancement--too bad. The new version must be implemented in its entirety, "all or nothing."

The new approach, which lets customers pick and choose which enhancements to apply, is made possible by SAP's Netweaver platform. A service-oriented architecture reorganizes system functionality into "services" which interact with one another by means of messages built on open industry standards.

SAP isn't the first to market with this approach. IFS has been building its IFS Applications products on a service-oriented architecture since the late 1990s, although it referred to it as a component-based architecture until recently. Nevertheless, SAPs market share is many times larger than SAP's and its practical application of SOA raises the bar for other major vendors. Oracle is also rearchitecting its applications for SOA, using its Fusion middleware, but I don't believe it is yet able to release new versions incrementally as SAP has done this week.

Computerworld has more on SAP's enhancements released this week.

Related posts
Computer Economics: A Phased Approach to SOA

by Frank Scavo, 12/05/2006 11:46:00 AM | permalink | e-mail this!

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Friday, December 01, 2006

New federal rules for discovery of electronically stored information (ESI)

Amendments to the Federal Rules for Civil Procedure (FRCP) take effect today that include major changes regarding how companies must produce electronic information during discovery proceedings of civil litigation.

The new rules now explicitly identify "electronically stored information" (ESI) as a distinct category of discoverable information, separate from "documents." The rules dictate what the parties do during discovery to identify and produce ESI.

Nossaman Litigation has an excellent bulletin summarizing the changes from a legal perspective. I would also recommend this summary from Morgan Lewis Resources, on the impact of the changes. Morgan Lewis's document categorizes the new rules as follows:
    The eDiscovery amendments cover five areas:
    1. Parties [to the litigation] must meet and confer early to address issues relating to eDiscovery, including the form and preservation of electronically stored information, the problems of reviewing the electronically stored information, and assertion of privilege.

    2. Electronically stored information that is not "reasonably accessible" does not have to be produced, unless the requesting party can show good cause.

    3. In limited circumstances, a claim of privilege may be asserted if a party inadvertently produces electronically stored information that is potentially privileged. The producing party may require the return, sequestration, or destruction of the information pending resolution of the privilege claim.

    4. Any review of business records conducted in response to interrogatories must now include searches of electronically stored information. "Electronically stored information" is specifically distinguished from "documents" or "things."

    5. A safe harbor from sanctions is available when "despite reasonable steps to preserve discoverable information" electronically stored information is lost as a result of routine computer operations.
    I see very little in the technology press about these amendments. John Soat at Information Week has been following the issue, but most others have not.

    I believe that the new rules will have a major impact on IT organizations. Many CIOs are not yet aware of these new regulations. The definition of ESI includes all kinds of information--unstructured data such as voicemail messages, email, and images, as well as structured information such as database records. There are major implications for how companies manage backup media and disaster recovery storage. The rules do seem to cut some slack in cases where electronic information is too difficult to product--but I don't see anything in the rules that lets small companies off the hook.

    And all this is taking place at a time when storage management disciplines in companies are actually declining.

    One thing is for certain: this spells big business for storage vendors and vendors of information management solutions. And lawyers.

    by Frank Scavo, 12/01/2006 07:09:00 AM | permalink | e-mail this!

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    Independent analysis of issues and trends in enterprise applications software and the strengths, weaknesses, advantages, and disadvantages of the vendors that provide them.

    About the Enterprise System Spectator.

    Frank Scavo Send tips, rumors, gossip, and feedback to Frank Scavo at .

    I'm interested in hearing about best practices, lessons learned, horror stories, and case studies of success or failure.

    Selecting a new enterprise system can be a difficult decision. My consulting firm, Strativa, offers assistance that is independent and unbiased. For information on how we can help your organization make and carry out these decisions, write to me.

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