Friday, December 01, 2006

Consulting and SI 2.0: Mining the Sea Change in Software

Consulting and SI 2.0: Mining the Sea Change in Software
Posted by Susan Scrupski @ 4:47 pm
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Fellow blogger Phil Wainewright attended the SIIA (Software Industry Information Assocation) conference this month. Phil writes:

Speaking on a panel at today's SIIA OnDemand Summit in San Jose, Abhijit Dubey of McKinsey revealed that a new survey by his organization has found that the proportion of CIOs considering adopting SaaS applications in the coming year has gone from 38% a year ago to 61% now. "That's a huge jump," he said, and he's not kidding. It's an indication of a sea-change in acceptance of SaaS over the past year.

The sea-change Phil is chronicling is spilling over to the consulting and systems integration markets. All IT services providers need to prepare for the oncoming sea change in how enterprise software is bought, delivered, and supported. The days of integrators and consultants as implementors of large enterprise apps are numbered. Sure SAP, Oracle, and even MicroSoft aren't dying off any time soon, but IT services firms who jump on the next net bandwagon early are going to see some attractive high margin opportunities.

For starters, there is the issue of business case. Consultants who can dig deep within the business processes of an enterprise are going to be invaluable in helping large and small enterprises take advantage of new SaaS and Enterprise 2.0 applications. Further, integration opportunities abound. Phil mentions Bluewolf Consulting, a systems integrator/consultant in NYC. Bluewolf has made a nice business out of integration opportunities that surround Salesforce.com. I had a long chat with Eric Berridge of Bluewolf Consulting recently. He spelled out a couple key differences between consulting 1.0 and consulting 2.0– namely.

* Consulting 2.0 is Business Process-based not technology-centric
* Making clients successful with a SaaS application is just plain easier and less expensive for the client

Bluewolf is involved in projects integrating Salesforce.com with large enterprise apps such as SAP and Oracle at large installations such as DuPont, The Hartford, Fox Networks, The New York Times, and British Petroleum. Berridge says when Bluewolf consultants sit down to talk to a client, they're talking about what the client wants to achieve vs. what technology they're going to employ to do it. Many times results can be achieved in a fiscal quarter or less, and will cost a tenth of what it would normally cost with a traditional enterprise implementation.

Integration opportunities around SOA also present a ripe opportunity for integrators. EDS announced a deal yesterday with Lufthansa to develop and implement a middleware, messaging and security platform that will enable the airline to interface, interoperate and integrate with their business partners and other airline systems through open standards.

At the Accenture analyst briefing this month, I had some time to talk to Bob Suh, Accenture's Chief Technology guru. Suh was telling me how Accenture has a dedicated team assigned to next-gen enterprise app Workday and has been working with them over a year. This pales in comparison to the 50,000 or so consultants they have dedicated to SAP and Oracle, but it's a start. At least Accenture has the foresight to realize the models are changing, and they need to be ready when the next wave of software hits the enterprise.

The smart Enterprise 2.0 firms are targeting Systems Integrators too. Today I spoke to Mike Wagner and Bob Bianchi at Ajax solutions developer, JackBe, who are hosting an invitation-only open house for Systems Integrators in December to preview the company's next generation of Ajax and REA technologies. They see systems integrators as an excellent partner to deliver their newest platform of products which will be generally available 2Q 2007. Because JackBe is targeting the "power user" within departments who can effectively build mashups and create applications on their own, SIs will benefit from the exposure to a whole new class of customer.

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