Wednesday, August 30, 2006

RFID adoption stalling?

Radio frequency identification (RFID) systems have been touted as a breakthrough enabling technology for supply chain management, asset management, IT security, patient tracking, and a host of other applications.

However, some preliminary analysis of statistics from our work at Computer Economics, coupled with some reports I'm hearing from clients, indicates that rollout of RFID in several different industry applications may be hitting a flat spot. Although companies have launched RFID pilot projects, or have implemented RFID in a limited way, it seems many of them are not extending their use of RFID, at least for now.

It's hard to say whether the problem is with RFID technology itself, or the perceived cost/benefits, but I'd like to understand more in order to write an analysis of this issue.

If you've got insights into the current state of adoption of RFID, please drop me an email, or leave a comment directly on this post.

Sunday, August 27, 2006's AppExchange proving its viability for developers

Bruce Richardson at AMR Research notes the rapid growth and adoption of new applications available on's AppExchange platform.

By way of review, AppExchange is the software-as-a-service (SaaS) infrastructure and application development platform on which runs. has also made this platform available for software developers to write, market, and sell new applications that can be integrated by means of SOA with itself, with other apps on AppExchange, or even with external applications that comply with SOA standards.

Richardson writes,
When [AppExchange] went live [in January 2006], there were more than 150 applications available. More than 1,500 applications were installed in the first week, and customers took more than 75,000 test drives to try them all out.

By April 20th, AppExchange had grown to 188 applications, with 7,100 installations and more than 100,000 test drives. The current numbers are 317 applications, nearly 14,000 installations, and more than 143,000 test drives. One executive said that the Kieden deal has focused a lot of eyes on AppExchange, providing a sharp boost to downloads and test drives.

The AppExchange site maintains a list of the five most popular applications. Maybe it's the free price, but four of the most popular are provided gratis by These include dashboards to track user adoption, project and issue management, sales quote support, and advanced call scripting.
Are all these new products built on AppExchange just toys? It doesn't appear so. According to another AMR research note, by Robert Bois, a start-up called Kieden launched a search marketing application earlier this year on AppExchange, which "allows users to buy Google ad words directly from within the CRM application and then track the closed-loop process for identifying productivity of leads from the campaign, all the way down to account level."

Kieden started in development in January, funded entirely by the founders own cash. This month the firm was acquired by none other than Whatever the price, which was not disclosed, going nine months from start up to acquisition sounds like a pretty good deal and it would seem to be a proof case for SaaS as a new route to value for enterprise software developers.

Related posts
Computer Economics: The Business Case for Software as a Service
SAP and opposing application platforms offers development sandbox set to strike out with AppExchange?

Friday, August 18, 2006

Oracle's Fusion strategy: clear as mud

Earlier this month, I wrote a post regarding Oracle's intention to build its next-generation Fusion applications on the Oracle E-Business Suite data model and business processes. My conclusion: for JDE and PeopleSoft customers, Fusion will not be like an upgrade to a new version but a migration to a whole new product.

Since then, Josh Greenbaum had the opportunity to sit down with Oracle's John Wookey to understand "the details of where Fusion 1.0 planning is today." Josh writes for Datamation, "I will say that Oracle’s strategy is now starting to make some sense."


Josh sums up Oracle's new Fusion story as this:
Fusion 1.0, instead of being a superset of the functionality available from the different stand-alone products that Oracle now owns, will be a subset culled from Oracle’s many product lines. That subset will appeal mostly to companies that think technology innovation along the lines of web services and business modeling is more important than functional innovation along vertical industry lines.

This means that Fusion 1.0 is not E-Business Suite 13, though many of the EBS data models will be part of Fusion 1.0. Nor is this a "SAP-killer" by any stretch of the imagination. The reality is that Fusion 1.0 is an alternative path toward web services, modeling, and other next generation functionality.
Well that certainly clears things up now, doesn't it?

Josh indicates that Oracle is about to launch "a road show designed in part to clear the air about what Fusion Applications are all about."

If Oracle's interview with Josh is any indication of what they will be presenting to customers, they might want to practice in front of the mirror a bit more before hitting the road.

Related posts
Fusion to build on Oracle's E-Business Suite

Tuesday, August 08, 2006

Privacy threat: another PC missing with VA data

Apparently, the Veterans Administration doesn't get it. In May, the VA reported that a laptop, containing personal information on 26.5 million individuals was stolen from a VA employee's home. That laptop has since been recovered and the thieves arrested.

But now desktop computer, containing personal information on an estimated 36,000 individuals, is missing from a VA subcontractor, Unisys. Unisys notified VA last week.

According to Computerworld, "the desktop computer may have contained patients' names, addresses, Social Security numbers, dates of birth, insurance carriers and billing information, dates of military service, as well as claims data that may include some medical information."

After the May incident involving the stolen laptop, VA officials testified before Congress several times concerning plans to revamp security as part of an agency-wide reorganization of its distributed IT environment. But apparently, VA is not moving fast enough.

I'm not privvy to what work Unisys was doing with the personal data, but it is hard to believe there was no way that some of that data couldn't have been de-personalized. For example, did Unisys really need to have the actual social security numbers of those individuals?

One solution: the VA needs a sensible data classification policy, or if it does have one, it needs to be enforced.

Related posts
Wal-Mart launches RFID pilot, but will privacy concerns stall adoption?
IT decisions that are too important to leave to the IT department

Sunday, August 06, 2006

IBM compromising its partner strategy with bid for MRO Software

IBM has reached agreement with MRO Software to acquire this vendor of enterprise asset management systems. The deal is for $740 million. IBM plans to incorporate MRO's products into its Tivoli systems management software.

While IBM's Tivoli products current provide asset management functionality for IT assets, MRO's functionality embraces all assets of the enterprise, including IT. In fact, MRO could be considered one of the leaders in EAM systems, if not the leader.
Its Maximo product line targets manufacturers, utilities, government, universities, and hospitality industries, among others. It is strong in advanced planning and scheduling for maintenance activities, and it accommodates complex condition-based preventative maintenance planning. It even has its own e-procurement solution and plays well with various online marketplaces for maintenance, repair, and operating supplies.

MRO's strategy in the past has been to partner with major ERP vendors to provide integration with financials and other back-office systems. This works well with IBM's strategy of providing consulting and implementation services across a wide range of technology providers.

Still, one must ask, does the acquisition of MRO Software represent a shift in IBM's strategy of not competing with its independent software vendor (ISV) partners? Yes, software sales are the most profitable segment of IBM's business these days. But, over the past decade, IBM's strategy has been to provide infrastructure software, such as databases and development tools to its ISV partners and also to provide implementation and integration services to customers of those ISVs. It avoided competing head-to-head with those ISVs for their core business. IBM has is doing a lot of acquisitions these days, but to my knowledge, this is its first major bid for a true business application vendor.

By own suspicion is that this is not a change of direction for IBM, but an exception. MRO was available, the technology match was good. Unfortunately, however, MRO comes with a lot more than is needed to fill out Tivoli's product lines. I'm guessing that IBM just compromised a bit with its partner strategy.

The test will come when IBM starts going up against SAP or Oracle for major EAM sales.

Related posts
IBM and Oracle: strange bedfellows
IBM: friend or foe to SAP?
IBM is a loser in Oracle/PeopleSoft deal

Thursday, August 03, 2006

Fusion to build on Oracle's E-Business Suite

It's now clear that Oracle's next generation application suite, dubbed Fusion, will be built on Oracle's flagship E-Business Suite (EBS) data model and business rules. Where Oracle does not have functionality that exists in JDE or PeopleSoft, Oracle will treat these as new requirements for Fusion. But in satisfying those requirements, there is no guarantee that the business process flow of Fusion will match that of today's JDE or PeopleSoft.

Oracle is not saying any of this publicly, not wanting to commit to this direction, but in response to questions along this line it is pointing to a Gartner report that says basically what I've stated in the first paragraph.

The implications for J.D. Edwards and PeopleSoft users are important. While Oracle has promised "lifetime support" for JDE and PeopleSoft products, it is not promising to continue to enhance these products as the rate it is doing so today. Essentially, this means that if JDE or PeopleSoft customers want to upgrade, at some point, they will be looking at a migration to Fusion. The fact that there will not be a merging of code from JDE and PeopleSoft into Fusion means that customers will need to evaluate Fusion just as they would a completely new ERP system.

In other words, for Oracle users, a move to Fusion will be like a major upgrade. For JDE and PeopleSoft users, it will be a completely new package.

The implications for prospects considering a new ERP system are also clear. In my opinion, there are very few, if any, cases where a company should consider JDE or PeopleSoft, knowing that these products are slated for retirement. Lifetime support is a good insurance policy for existing JDE and PeopleSoft customers--those that have already made their investment in these systems. But why would a company, not yet committed, make an investment in products that are not the basis for Fusion? As one CIO told me recently, it would be like making a strategic decision today to buy IBM's Informix database. Sure, IBM still supports Informix, but that's not where it's making its major investments.

The JDE resellers may argue. But the fact is that many of them are already selling EBS along with JDE or are planning to do so. There will be a lot of work going forward to support JDE customers--even more work, perhaps, to support those that want to migrate to Fusion. But I expect that new sales for JDE are already tapering off and the resellers know this.

Do you have a different opinion? Leave a comment on this post or email me.

Related posts
Oracle's new reseller strategy and speculation on the future of JDE