Digital Transformation Digest: Arizona Accepts Crypto For Tax, Google Rumored With iMessage Competitor, HomePods Sound Good

Principal Analyst and Founder
Constellation Research

R “Ray” Wang is the CEO of Silicon Valley-based Constellation Research Inc. He co-hosts DisrupTV, a weekly enterprise tech and leadership webcast that averages 50,000 views per episode and blogs at www.raywang.org. His ground-breaking best-selling book on digital transformation, Disrupting Digital Business, was published by Harvard Business Review Press in 2015. Ray's new book about Digital Giants and the future of business, titled, Everybody Wants to Rule The World was released in July 2021. Wang is well-quoted and frequently interviewed by media outlets such as the Wall Street Journal, Fox Business, CNBC, Yahoo Finance, Cheddar, and Bloomberg. Short Bio R “Ray” Wang (pronounced WAHNG) is the Founder, Chairman, and Principal Analyst of Silicon Valley-based Constellation Research Inc. He…...

State of Arizona Senate Passes Bill To Accept Tax Payments With Blockchain Technologies

On February 8th, 2018, the Arizona Senate passed a bill allowing payment of taxes by cryptocurrencies. With a Senate Finance Committee vote of 4-3 on January 24th, and a 16-13 vote in favor by the senate on February 8th, Arizona Senate Bill 1091 now heads to Arizona’s House of Representatives for approval. Switzerland, through the munincipalities of Zug and Chiasso, have led the way for payments by cryptocurrencies such as Bitcoin

Should the bill be adopted, Arizona would be the first US State to accept tax payments through a payment gateway for cryptocurrency in the year 2020. Based on language in the bill, payments must be converted to US dollars within 24 hours.

Constellation’s Point of View (POV): As the value exchange mechanisms for blockchain grow in user adoption, acceptance of cryptocurrencies by a growing number of entities will eventually result in fiat currency status. Organizations seeking to accept new payments should consider implications on volatility of conversion and the adoption rate of the cryptocurrency before making any considerations on acceptance. Recent announcements by Singapore Airlines that their loyalty program, KrisFlyer, would use blockchain technology and a digital wallet, show how the value exchange mechanism is being expanded through digital wallets. Singapore Airlines worked with KPMG Digital Village and Microsoft to complete their Proof of Concept to create digital KrisFlyer miles. They expect the offering to be rolled out in the summer of 2018

Will Google Android Finally Have It’s Apple iMessage Competitor with Project Ditto?

Recent rumors in Silicon Valley have Google working on a project to compete directly with Apple’s iMessage. The built-in message app’s ability to go from machine to mobile and back remains a significant feature advantage for most Apple users. While there are many third party Android apps, the rumors if true, show Google’s desire to consolidate its messaging services with a desktop version with a browser extension. While Google has not made any official comments, rumored features from inside sources include Wifi network texts and a leap ahead feature with payments without the use of google wallet.

Constellation’s POV: The open ecosystem has given Google an advantage in adoption as well as a disadvantage with centralizing core functions and upgrades. Constellation’s Future of Work Vice President and Principal Analyst, Alan Lepofsky, noted “Google needs to dramatically simplify their messaging portfolio. There is Google Allo, Duo, Hangouts Chat, etc. In order to drive adoption they’re (Google) going to have to reduce the barriers to entry. To win, Google must show they can work on both Android and iOS devices, whereas Apple is IOS only. However, the challenge for Google is to get any iOS user to break free from iMessage.”

Constellation believes that even with a new offering, they face health competition as there are already cross platform options such as WhatsApp or Facebook Messenger. Organizations should prepare for messaging platforms to serve as payment gateways and also a key pillar in delivering on immersive experiences for the customer.

Can It Be True? Apple’s HomePod Sounds Better Than The KEF X300A

In a review of the Apple Homepod by WinterCharm for Reddit Audiophile review, the reviewer pitted the AppleHomePod against the $999 KEF X300A, a reference audiophile grade speaker. As quoted by WinterCharm:

I am speechless. The HomePod actually sounds better than the KEF X300A. If you’re new to the Audiophile world, KEF is a very well respected and much loved speaker company. I actually deleted my very first measurements and re-checked everything because they were so good, I thought I’d made an error. Apple has managed to extract peak performance from a pint sized speaker, a feat that deserves a standing ovation. The HomePod is 100% an Audiophile grade Speaker.

The tests used a MiniDSP UMIK-1 USB Calibrated Microphone with Room EQ Wizard (Version 5.18 on macOS 10.13.3) on a 2011 MacBook Pro.

Constellation’s POV: The proliferation of listening devices and speakers from Alexa to Google Home have shown how large consumer tech companies have managed to infiltrate the home and office environments with conversations as a service. However, Apple’s entry into the market shows their intention to start with high quality audio that happens to have a conversational UX instead of having vast mass market adoption. From an adoption and training of AI, Amazon’s Alexa has taken a different strategy by improving mass adoption and accelerated training of Alexa in order to catch up with Google Home’s product offering lead. With AI emerging as the new UX, Constellation believes that the offering with the greatest adoption and usage will emerge as the key player in the Conversational UX wars. Consequently, enterprises seeking conversational interfaces should keep Google Home and Amazon’s Alexa in their short lists.

New C-Suite Tech Optimization Innovation & Product-led Growth Data to Decisions Future of Work Next-Generation Customer Experience Digital Safety, Privacy & Cybersecurity AI Blockchain ML Machine Learning LLMs Agentic AI Generative AI Analytics Automation business Marketing SaaS PaaS IaaS Digital Transformation Disruptive Technology Enterprise IT Enterprise Acceleration Enterprise Software Next Gen Apps IoT CRM ERP finance Healthcare Customer Service Content Management Collaboration B2B B2C CX EX Employee Experience HR HCM Supply Chain Growth Cloud eCommerce Leadership M&A Enterprise Service Chief Customer Officer Chief Executive Officer Chief Information Officer Chief Digital Officer Chief Technology Officer Chief AI Officer Chief Data Officer Chief Analytics Officer Chief Information Security Officer Chief Product Officer Chief Operating Officer Chief Experience Officer

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Event Report - ADP ReThink - Great event and a lot in the making

Holger Mueller

Vice President and Principal Analyst
Constellation Research

Holger Mueller is VP and Principal Analyst for Constellation Research for the fundamental enablers of the cloud, IaaS, PaaS and next generation Applications, with forays up the tech stack into BigData and Analytics, HR Tech, and sometimes SaaS. Holger provides strategy and counsel to key clients, including Chief Information Officers, Chief Technology Officers, Chief Product Officers, Chief HR Officers, investment analysts, venture capitalists, sell-side firms, and technology buyers.  Coverage Areas: Future of Work Tech Optimization & Innovation  Background: Before joining Constellation Research, Mueller was VP of Products for NorthgateArinso, a KKR company. There, he led the transformation of products to the cloud and laid the foundation for new Business Process as a…...

We had the opportunity to attend ADP's ReThink 2018 conference in Monaco from January 29th till February 1st, 2018. The conference targets ADP customers who use its Global View product, most of them large international enterprises. The enterprises who made it to Monaco represented 6T US$ in global revenue…

Prefer watching over reading - here is the event video (if it doesn't show up, click here):

Here is the 1 slide condensation (if the slide doesn't show up, check here):

Event Report - ADP ReThink - The right mix of vision and progress from Holger Mueller

Want to read on? Here you go:

An event that stands out - There is pretty much no event that can compete with ADP ReThink from a quality of speaker and location perspective. Last year in Barcelona the headline speaker was Amal Clooney, this year there was former UK Prime Minister Right Honorable David Cameron and the youngest Nobel prize winner Malala Yousafazi, interviewed by magazine editor legend Tina Brown… who also shared her life story and view on women topics. It’s great to see ADP going for speakers that can tackle common, but also controversial topics (e.g. Brexit) and let speakers share their views freely. Customers certainly appreciated the caliber of speakers… and few events happen in a hotel, where you sleep over a Formula 1 GP track, exiting to the most famous hairpin curve in the world… very well done.

Malala Yousafzai Tina Brown ADP rethink Holger Mueller Constellation Research

Malala Yousafzai in a conversation with Tina Brown

Global Cloud Connect makes progress - ADP’s key new product for global customers, Global Cloud Connect (GCC) is making satisfactory progress. For the first time with GCC, ADP had one of their client design partner’s join them on stage. The global nuclear energy company shared their experience mapping and transforming data with GCC, which the client’s payroll expert even referred to as ‘fun’. An emotional status seldom associated with global payroll setup… the customer shared that they had moved from 80 to 3 relevant interfaces. That is a substantial reduction in complexity for a global company, in any automation area, particularly payroll. ADP is currently working to begin GCC pilot clients, beginning the first wave of pilot implementations in February with an expected GA in June 2018. The scope of GCC is massive, but the prize is well worth it. ADP progresses with usual ADP caution, but that is probably warranted given the scope and importance of the task. Getting payroll 99.9% right is not good enough…

Jimenez Holger Mueller ADP Rethink Constellation research

Jimenez and what ADP does with GCC

ADP gears up for Gig Economy - ADP acquired WorkMarket a few weeks ago, becoming the first large HCM vendor to get into automating the Gig Economy (see my Market Move blog post here). If only half of the optimistic forecasts on the gig economy come true, all HCM vendors need to provide the relevant capabilities for the new best practices a contingent workforce requires. WorkMarket was present in Monaco, showing their product to great interest of attendees. With WorkMarket ADP has acquired one of the leading vendors powering the Gig Economy, now the new area on how to keep operating and integrating a Gig Economy platform with a traditional HCM platform looms. Few weeks in and certainly too early to ask and address, but something ADP will have to tackle in the coming quarters.

Weinstein Holger Mueller ADP Rethink Constellation research

Weinstein on how is doing the work

Strategy and Technology on appealing track – Both Don Weinstein for overall ADP strategy and Roberto Masiero for the technology vision presented in Monaco, and both are on track in regards of direction. Weinstein described the Future of Work (always like when keynotes are named identically to the research area at Constellation Research….) and how ADP plays a role in this. Masiero always has some interesting nuggets out of the innovation labs to share. If ADP delivers on half on the strategy shared by Weinstein and half of Masiero’s technology plans soon, ADP will be sitting well in regards of the demands and hopes of people leaders making system decisions in the next year.

Masiero Holger Mueller ADP Rethink Constellation research

Masiero with the "1st Spreadsheet"

MyPOV

ADP is quickly moving on expanding its core competence of (global) payroll to overall HCM vendor for global enterprises. Mentioned only on passing, but asking attendees to take a look, ADP mentioned its new HCM system, Lifion. Good to see that ADP wants its international customers to take a look at the product. ADP did not mention its new payroll – PI – understandable as most customers are GlobalView customers at the conference, but it will have to get less shy about talking more software going forward. The event had close to a dozen customer testimonials, which are always interesting for attendees, as all grapple with the challenges of global HCM systems, learning about the challenges, opportunities and best practices is always a great topic for any conference. The key product for the audience is GCC, that appears to be on track and customers took note.

On the concern side, ADP will have to switch the format of the event from vision heavy to more product centric. It would almost be a crime in the positioning category not showing and sharing with its global customers what is happening with Lifion and Pi. That changes the character of the conference a bit, but in my view for the better… at the end enterprises send their representatives to a great conference like ADP ReThink to get their arms around products, understand their ability, maturity and roadmap ahead. On the flip side ADP has its hands full with Lifion, Pi and GCC, so the traditional steady pace of rolling out innovation is a good, quality minded approach. But ADP needs to get all of its innovations in front of its global customers. An ‘always on’ payroll matters for international companies, too.

But for now, congrats to ADP to one of the top events in the industry. Hard to top in 2019, but that’s a good problem to have. And the need to morph the event to more hands-on product mix is a good opportunity to open new categories of automation for customers.

Future of Work Matrix Commerce Innovation & Product-led Growth New C-Suite Next-Generation Customer Experience Revenue & Growth Effectiveness Digital Safety, Privacy & Cybersecurity Data to Decisions Tech Optimization ADP AI Analytics Automation CX EX Employee Experience HCM Machine Learning ML SaaS PaaS Cloud Digital Transformation Enterprise Software Enterprise IT Leadership HR Chief Customer Officer Chief People Officer Chief Human Resources Officer

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If a Picture Is Worth a Thousand Words

Alan Lepofsky

Vice President & Principal Analyst
Constellation Research

Alan Lepofsky - VP and Principal Analyst, Constellation Research. With almost two decades of experience in the collaboration software industry, Lepofsky helps organizations improve the way their employees work together to get their jobs done. Lepofsky’s primary research area The Future of Work, focuses on: integrating collaboration and business processes (Purposeful Collaboration), structuring work via Social Task Management, leveraging analytics and digital assistants to work more productively, the strategic impact of mobile computing on business transformation, and measuring workforce culture based on Digital Proficiency instead of age. Twitter: @alanlepoLinkedIn: https://ca.linkedin.com/in/alanlepo     , Title: Big IdeasIntelligent Collaboration: The Intersection of…...

A quick tour of my home office and some of the devices I use to create videos.

Product links:

Blue Snowflake microphone

DJI Osmo steadycam

Insta360 camera

Logitech Brio webcam

Microsoft Surface Book laptop

Microsoft Windows 10 Mixed Reality

Future of Work

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Market Move - Red Hat snaps up CoreOS - The Kubernetes ecosystem heats up

Holger Mueller

Vice President and Principal Analyst
Constellation Research

Few open source standard have won faster than Kubernetes, and that also means the ecosystem consolidation is moving faster than almost any market in enterprise software. So it came as no surprise that Red Hat announced it acquired CoreOS.

So let's dissect the press release in our customary style – it can be found here:

Red Hat, Inc. (NYSE: RHT), the world's leading provider of open source solutions, today announced that it has signed a definitive agreement to acquire CoreOS, Inc., an innovator and leader in Kubernetes and container-native solutions, for a purchase price of $250 million, subject to certain adjustments at closing that are not expected to be material. Red Hat's acquisition of CoreOS will further its vision of enabling customers to build any application and deploy them in any environment with the flexibility afforded by open source. By combining CoreOS's complementary capabilities with Red Hat's already broad Kubernetes and container-based portfolio, including Red Hat OpenShift, Red Hat aims to further accelerate adoption and development of the industry's leading hybrid cloud platform for modern application workloads.

MyPOV – Good intro, shares the motivation (applications / containers everywhere), the prices (250 M) and where the new home is (Red Hat OpenShift) and the prize (hybrid cloud deployment). Kudos to the press release authors.

We believe this acquisition cements Red Hat as a cornerstone of hybrid cloud and modern app deployments.
PAUL CORMIER PRESIDENT, PRODUCTS AND TECHNOLOGIES, RED HAT

MyPOV – Ok good to have a quote, with the usual optimistic to grandiose outlook today woth Paul Cormier.

As applications move to hybrid and multicloud environments, a growing number of organizations are using containers to more easily build, deploy and move applications to, from, and across clouds. […]

MyPOV – No question containers are popular for load portability. Nice would have been a statement e.g. how many containers are run by Red Hat / CoreOS.

Founded in 2013, CoreOS was created with a goal of building and delivering infrastructure for organizations of all sizes that mirrored that of large-scale software companies, automatically updating and patching servers and helping to solve pain points like downtime, security and resilience. Since its early work to popularize lightweight Linux operating systems optimized for containers, CoreOS has become well-regarded as a leader behind award-winning technologies that are enabling the broad adoption of scalable and resilient containerized applications.

MyPOV – Fair history of CoreOS… but not sharing the Google investment, and plan to make Kubernetes more popular for on premises.. that master plan has pretty much paid off by now… and the market leader for Linux (Red Hat) gives CoreOS the biggest reach for on premises deployments.

CoreOS is the creator of CoreOS Tectonic, an enterprise-ready Kubernetes platform that provides automated operations, enables portability across private and public cloud providers, and is based on open source software. It also offers CoreOS Quay, an enterprise-ready container registry. CoreOS is also well-known for helping to drive many of the open source innovations that are at the heart of containerized applications, including Kubernetes, where it is a leading contributor; Container Linux, a lightweight Linux distribution created and maintained by CoreOS that automates software updates and is streamlined for running containers; etcd, the distributed data store for Kubernetes; and rkt, an application container engine, donated to the Cloud Native Computing Foundation (CNCF), that helped drive the current Open Container Initiative (OCI) standard.

MyPOV – Good summary of what CoreOS does and has achieved in remarkably short time. Red Hat now needs to explain and share what it plans to do with the products in the next months.

Red Hat was early to embrace containers and container orchestration and has contributed deeply to related open source communities, including Kubernetes, where it is the second-leading contributor behind only Google. Red Hat is also a leader in enabling organizations around the world to embrace container-based applications, including its work on Red Hat OpenShift, the industry's most comprehensive enterprise Kubernetes platform. Now with the combination of Red Hat and CoreOS, Red Hat amplifies its leadership in both upstream community and enterprise container-based solutions.

MyPOV – Everybody likes to claim to be an early adopter of a winning standard, but in this case RedHat has the chops to prove it, based on the Kubernetes distribution it has delivered… of course partnering with Google since a year on many levels never hurt that effort.

The transaction is expected to have no material impact to Red Hat's guidance for its fourth fiscal quarter or fiscal year ending Feb. 28, 2018.
The transaction is expected to close in January 2018, subject to customary closing conditions.

MyPOV – Things move fast in the open source and container world.

Paul Cormier, president, Products and Technologies, Red Hat
"The next era of technology is being driven by container-based applications that span multi- and hybrid cloud environments, including physical, virtual, private cloud and public cloud platforms. Kubernetes, containers and Linux are at the heart of this transformation, and, like Red Hat, CoreOS has been a leader in both the upstream open source communities that are fueling these innovations and its work to bring enterprise-grade Kubernetes to customers. We believe this acquisition cements Red Hat as a cornerstone of hybrid cloud and modern app deployments."

MyPOV – Good quote from Cormier on why Red Hat acquired CoreOS.

Alex Polvi, CEO, CoreOS
"Red Hat and CoreOS's relationship began many years ago as open source collaborators developing some of the key innovations in containers and distributed systems, helping to make automated operations a reality. This announcement marks a new stage in our shared aim to make these important technologies ubiquitous in business and the world. Thank you to the CoreOS family, our customers, partners, and most of all, the free software community for supporting us in our mission to make the internet more secure through automated operations."

MyPOV – Ok quote from Polvi, indeed a new phase for CoreOS. Good to thank all that got the vendor to this point.

Overall MyPOV

Containers have quickly become the deployment form of choice for enterprises, mainly because of their portability. And Kubernetes has practically won that game, being supported on all major clouds. But enterprises for a variety of reasons (security, performance, data residency being the most prominent ones) still deploy on premises. There the OS of choice is Linux, and Red Hat is the market leader. So adding more support for Kubernetes makes sense for Red Hat. It also has the upside to convert some CoreOS customers to on premises with Red Hat.

On the concern side, this acquisition removes one of the key promoters of Kubernetes, funded by Google with the intention to help its propagation… but Kubernetes growth and foot print are likely robust enough to not be damaged from the market move.

But for now, congrats to Red Hat on a key acquisition and good luck to the CoreOS team and customers being part of the Red Hat ecosystem, likely going to be all good news.

Tech Optimization Data to Decisions Digital Safety, Privacy & Cybersecurity Innovation & Product-led Growth Future of Work SaaS PaaS IaaS Cloud Digital Transformation Disruptive Technology Enterprise IT Enterprise Acceleration Enterprise Software Next Gen Apps IoT Blockchain CRM ERP CCaaS UCaaS Collaboration Enterprise Service Chief Information Officer Chief Technology Officer Chief Information Security Officer Chief Data Officer Chief Executive Officer

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Microsoft Updates Teams with New Integration Features

Alan Lepofsky

Vice President & Principal Analyst
Constellation Research

Today Microsoft released an update to Microsoft Teams that enhances the "seamless hub for personal productivity and team collaboration" experience.

Here is my review:

Future of Work

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Market Move - SAP acquires Callidus - More Sales Effectiveness in the Back Office of the Front Office

Holger Mueller

Vice President and Principal Analyst
Constellation Research

SAP hasn't been on the 1B+ acquisition path since 2014, and at the same time is building out its next generation ERP offering with S/4HANA. SAP seemed to be on an organic build out path of capabilities, so the more (or less) was the surprise that SAP stepped back into acquisition mode, acquiring Dublin, CA based CallidusCloud (Callidus going forward here) for 2.4B US$.

So let's dissect the press release in our customary style, it can be found here:

DUBLIN, Calif. and WALLDORF, Germany — SAP SE (NYSE: SAP) and Callidus Software Inc. (doing business as CallidusCloud®) (Nasdaq: CALD) today announced that SAP America, Inc. has entered into an agreement to acquire CallidusCloud, the leader in cloud-based Lead to Money (Quote-to-Cash) solutions.

MyPOV - Good summary. Interesting that the acquisition is done by SAP America, not SAP SE… but we have seen that before and I am sure the colleagues with a tie (aka the financial analysts) have a good answer for this.

SAP will assemble the most complete and differentiated portfolio to manage today's customer experience
CallidusCloud's Lead to Money suite for sales combined with SAP's Customer Engagement suite creates leading CRM solution portfolio

MyPOV – The usual bold statements made around an acquisition. SAP is never shy here, but to be fair Callidus gives SAP some options of differentiation around Sales Effectiveness (this is guiding sales people to do the 'right' thing in selecting leads to develop, opportunities to pursue, products to select – all with influencing them via variable compensation – while having some training / gamification assets to educate them on what is 'right'). Not so clear how SAP's Customer Engagement suite (is that SAP Hybris?) combines to that. Callidus has been great to steer sales people to do the 'right' thing, not end users / consumers.

The CallidusCloud board of directors has unanimously approved the transaction. The per share purchase price of $36.00 represents a 21% premium over the 30-day volume weighted average price per share and a 28% premium over CallidusCloud's 90-day volume weighted average price per share. The per share price represents an enterprise value of approximately $2.4 billion. SAP has elected to fund the transaction with existing cash balances and an acquisition term loan. The transaction is expected to close in the second quarter of 2018, subject to approval from CallidusCloud stockholders, clearances by the relevant regulatory authorities, and other customary closing conditions. The transaction is expected to be essentially neutral to SAP's non-IFRS earnings per share for fiscal 2018 and accretive to SAP's non-IFRS earnings per share for fiscal 2019.

MyPOV – Good to see the transparency on the financing… looks like SAP wants to keep some powder dry for more (?) and take advantage of still low interest rates. Interesting in the cloud era that SAP sees now accretive effects in earning starting only in 2019. Maybe the acquisition and onboarding costs are eating those. Again a tidbit to check with the financial analysts.

Reinventing the Front Office
The acquisition gives SAP immediate leadership in the Lead to Money space that includes sales performance management (SPM) and configure-price-quote (CPQ). CallidusCloud offers a full suite of SPM and CPQ solutions, including sales enablement, sales analytics and customer engagement. The combination of SAP's assets with CallidusCloud's will deliver the most complete, end-to-end, fully cloud-based 'Lead-to-Cash' offering. CallidusCloud has been a partner of SAP for several years, based on a joint selling agreement.

MyPOV – Another gutsy statement in regards of reinventing the front office. Interesting SAP does not use the more common CRM, this maybe the start of SAP pushing more again into CRM. Front Office is a good term, but most ERP vendors shied away from it as Back Office isn't terribly appealing. The irony is that Callidus is the Back Office of the Front Office – doing the choreography of sales people. Callidus has an immediate effect on SAP's traditional CRM offering (Is it still Cloud 4 customer?). That's where Callidus comes from and does the bulk of its revenue. Good to notice that both vendors have been partners since a long time. That should accelerate product based integration offerings.

Two Growth Companies, Stronger Together
CallidusCloud is a synergistic addition to SAP's portfolio and significantly strengthens SAP's position in the customer relationship management (CRM) space. CallidusCloud's solutions are tailored to the specific needs of sales people on the ground and link sales-related information, such as pricing, incentives, and commissions, to enterprise resource planning (ERP) systems. CallidusCloud as part of SAP will seamlessly link front and back offices, align sales, compensation and corporate goals, and ensure real-time data flow between the field and finance department.

MyPOV – This is the most realistic and real paragraph of the press release. Yes, its about CRM and Sales Effectiveness – with a heavy slant in regards of variable compensation of sales people (or Incentive Compensation). And variable pay has a wider organizational impact, with a large part of the processing happening in the CFO organization, sometimes even the CHROs (close to payroll).

Statements by the Chief Executive Officers
"SAP is connecting the back office to the front office in this consumer-driven growth revolution," said Bill McDermott, CEO of SAP. "Our customers are focused on reinventing sales, service, marketing, and commerce. The addition of CallidusCloud aligns perfectly to SAP's innovation strategy to transform the front office. SAP gives CallidusCloud the global scale to accelerate its already impressive growth. These two strong companies will be better together, help the world run better and improve people's lives."
MyPOV – Good quote of McDermott. Obviously "Back Office" does not have a bad reputation these days in the eyes of SAP. Stressing the need of reinvention… which SAP badly needs on the CRM front.

"We are super excited to join forces with SAP," said CallidusCloud's CEO Leslie Stretch. "This move gives customers precisely what they want, the market leading Sales Performance (SPM), Sales Execution (CPQ) and Sales Enablement clouds combined with SAP Hybris and S/4HANA. This is true Lead to Money, beyond CRM and beyond Quote-to-Cash. It's the joined-up Front Office and Back Office Cloud everyone needs for 21st Century Business. In addition, the purchase price provides substantial value to our stockholders."

MyPOV – Good quote by Stretch. Might be the last time we hear of "Lead to Money", the Callidus marketing moniker. As with all acquisitions – it will be interesting how the Callidus business will be organized. Past multiple billion acquisitions saw SAP preserve the organization initially (SuccessFactors, Business Objects, Ariba …) – no mention here.

Additional Business Synergies
SAP's S/4HANA business suite in the cloud, SAP Hybris, and Gigya solutions already help businesses deliver new customer experiences, connecting the demand chain to the supply chain. SAP Hybris solutions help companies serve consumers in any channel, on any device. In addition, SAP Hybris's revenue and billing solutions enable companies to monetize new business models. Gigya helps companies secure, protect, and service the consumer's digital identity in the age of data protection and regulation.

MyPOV – Good attempt to paint the big picture and synergies… but as usual these days with SAP – the demarcation lines between S/4HANA and new assets – here SAP Hybris aren't fully clear. Good to see the mention of Gigya, but also not clear how it plays here (customer first party data for Sales Effectiveness – huh? Callidus is about to align employees – not customers / consumers directly).

CallidusCloud, combined with SAP's solution portfolio, also will offer companies powerful tools to enhance sales execution and transform customer engagement. CallidusCloud's portfolio will strengthen existing SAP sales solutions. The portfolio will be enriched with sales planning and forecasting, territory management, and pipeline management. SAP's sales content management will benefit from easy access to contracts, collateral, and learning.
MyPOV – A much fairer paragraph on what Callidus brings to SAP and what the synergies are – mostly on the back office side of the front office.

Additionally, with the Lead to Money suite, CallidusCloud is a leader for cloud-based Quote-to-Cash solutions. This area includes solutions for sales performance management (SPM), sales execution including configure-price-quote (CPQ) applications, sales enablement including learning applications, customer engagement and analytics. CallidusCloud SPM solutions give salespeople instantaneous knowledge of their compensation associated with particular product and pricing configurations and reduce errors in calculating sales commissions and compensation arrangements. CallidusCloud CPQ solutions enable salespeople to identify and configure product packages that have built-in rules for discounts and that can generate proposals for the customers on the spot and during the conversation with the customer. CallidusCloud CPQ solutions also can automatically generate contracts in real time while the salesperson is with the customer. Part of CallidusCloud's offering is a sales-focused and mobile-native learning platform called "Litmos," which shows solid growth.

MyPOV – Good summary of what Callidus can do. Glad there was no link to SuccessFactors (yet) or SAP HCM – as learning platform was mentioned- that could / would create more confusions – though I expect SAP to leverage synergies between the across the Bay neighbours… Learning is crucial to aid enterprises with acceleration.

SAP will follow a strategy of openness that will continue to support integration of CallidusCloud solutions with third-party installations.

MyPOV – Very important statement here – as from my estimate more than 70% of Callidus customers don't use … SAP. But most prominently Callidus partners Oracle and Salesforce. Keeping these customers will be key from a financial ROI for SAP of this acquisition. The next months will be key to keep the confidence of these customers up.

Upon completion of the transaction, SAP expects to consolidate all CallidusCloud product assets within SAP Hybris solutions as part of SAP's Cloud Business Group. The existing management team will continue to lead CallidusCloud. The SAP Cloud Platform is to be used for the technical integration of CallidusCloud solutions.

MyPOV – So the home for Callidus is clear. Part of SAP Hybris, under Atzberger, rolling up to Enslin. Glad to see the SAP Cloud Platform mentioned here – though Callidus has some interesting technology and architecture for SAP overall and SAP CP (e.g. OrientDB, a multi model database, with a graph database origin).

Implications, implications...

SAP Customer Implications

This is likely going to be good news for SAP customers, who get market leading Sales Effectiveness capabilities. Joint customers are the lucky group, but will have to look at what happens to integration, and should seek re-assurance in regards of old (likely pre SAP Cloud Platform) built integrations. License considerations will also have to be considered. A joint roadmap should be asked for, as well as re-assurance of in flight promised capabilities to be delivered.

Callidus Customer Implications

See above for joint SAP customers. Customers with other ERP back ends will not have to panic, as SAP's record for diverse backends has improved, nonetheless re-assurances in regards of continued operation are key (beyond this press release). Contact your Callidus account manager asap and be visible. Special attention needs to be given to non SAP integration / functionality commitments that they are delivered, and will have the usual support and maintenance timelines. Non SAP customer also need to seek re-assurance on longer term roadmap commitments that are crucial to them.

Partner Implications

Joint partners will be the lucky ones, but may have to do some practice consolidations. Their clients need to make sure they keep the professionals they like to work with. Callidus only partners have to make a call if they want to become SAP partners – or focus on the other partners. Callidus and other ERP / Salesforce partners may look for alternatives, depending on how large their business and trust with SAP is.

Competitor Implications

Overall CRM / ERP integration will become more important, which is great news for customers, as they operate both CRM and ERP and have often left at integration odds (even with the same vendor for both automation areas). When enterprise vendors have to focus more on Sales Effectiveness, good things happen for enterprises. Likely Oracle will have to ramp up investments, and Salesforce will have to ease integration work needed to integrate with ERP backends. This acquisition will also put pressure on Salesforce to move the best of breed yard stick out further – to justify integration costs any non ERP based offering in CRM has to justify.

Overall MyPOV

A good move by SAP, that had to do something to get its CRM business invigorated. Looking at the back office of the front office – which Callidus largely does – is a good move as it allows differentiation towards key competitors Salesforce and Oracle. Moreover, Callidus capabilities align well with synergies next to ERP, of course SAP Hybris, SAP SuccessFactors and even SAP Ariba (Contract creation, next best action etc.). Most importantly for enterprises, it means ERP players (SAP, Oracle) are paying more attention to CRM again, which in recent years has been left largely to Salesforce. More competition and functional differentiation is good for enterprises.

On the concern side, SAP is late to re-invigorate its CRM plans. Salesforce has done a lot of business in the SAP install base in the last years, so likely that needed a reaction. With Atzberger, McDermott has put a talented executive on the job, it will be important to fill out roadmap and more plans through 2018. It's not too late for SAP, but not much time left, going beyond the realization that more than e-Commerce (aka SAP Hybris) are needed to play big in CRM.

Overall good news, customers and prospects now have to await the road maps, which maybe at at Sapphire if all goes well. Stay tuned.

Data to Decisions Future of Work Innovation & Product-led Growth New C-Suite Marketing Transformation Next-Generation Customer Experience Digital Safety, Privacy & Cybersecurity Tech Optimization SaaS PaaS IaaS Cloud Digital Transformation Disruptive Technology Enterprise IT Enterprise Acceleration Enterprise Software Next Gen Apps IoT Blockchain CRM ERP CCaaS UCaaS Collaboration Enterprise Service Chief Information Officer Chief Technology Officer Chief Information Security Officer Chief Data Officer Chief Executive Officer

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Can ALE Rainbow Differentiate Via Verticals

Alan Lepofsky

Vice President & Principal Analyst
Constellation Research

This week I attended Alcatel-Lucent Enterprise's (ALE) partner and analyst conference, Connex18 in Riga, Latvia. ALE is currently known mainly for unified communications, contact centre, PBX and telephony type solutions, but they are evolving to a more cloud based Unified Communications as a Service (UCaaS) and Communications Platform as a Service (CPaaS) provider. For my coverage area, that means they are entering the Enterprise Group Messaging (ex: Microsoft Teams, Slack, Cisco Spark, etc.) market with their product ALE Rainbow. In the video below I provide my thoughts on the event.

Future of Work Marketing Transformation Next-Generation Customer Experience Revenue & Growth Effectiveness Data to Decisions Innovation & Product-led Growth New C-Suite Tech Optimization Chief Marketing Officer Chief People Officer Chief Revenue Officer Chief Experience Officer

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DisrupTV Braves the Storm in Davos #WEF18

Aubrey Coggins

Constellation Research

Aubrey (Levinstone) Coggins manages Constellation's marketing and communications programs and is the producer of DisrupTV, a weekly Web series on innovation and the enterprise.  She previously served as a senior manager of corporate communications at Egnyte and held account roles at Access Communications and The Hoffman Agency. Born and raised in Texas, she received a bachelor's degree in Public Relations from The University of Texas at Austin – Hook ‘em!   ...

DisrupTV was on the road in Davos this week. What’s trending and on the minds of leaders from across the globe, especially the executives in Switerzland braving the freezing snowfall and massive transit congestion?

R “Ray" Wang, founder and principal analyst at Constellation Research, and Vala Afshar, chief digital evangelist at Salesforce, caught up with some inspirational thought leaders at the Wipro Pavilion to share the latest thoughts from Davos and the top ideas for 2018 from experts in tech policy, economic challenges, blockchain, innovation, cultural shifts and entrepreneurship.

Blockchain was all the rage on the technology front with concurrent conferences that brought innovative sessions, drew interested investors, and attracted entrepreneurs to converge unofficially at Davos. The use cases on supply chain, commerce, public sector reform, drug discovery, patient care, and finance rose to the top. The unofficial CryptoHQ conference proved to be a hit, leading the way by bringing non-traditional Davos attendees to participate in the conversations.

On the non-technology side, global business leaders focused on responding to the U.S. tax law changes and addressing inequality in the workplace. Leaders continue talking around the goal of bringing together a shared future in a fractured world through pay equality, job creation, tech for good, and inclusion programs.

Many of these themes can be found in Constellation’s upcoming Futurist Framework for 2018 - 2022. The beta preview of Constellation’s Futurist Framework was also released sharing the first three elements of Economic, Societal and Political trends for 2018 to 2020.

Check out Wednesdays interviews with:

Richie Etwaru, CDO at IQVIA & Author of "Blockchain: Trust Companies"
Jayraj Nair, Global Head of IoT and VP at Wipro
David Chou, VP & CIO/CDO at Children’s Mercy Kansas City
Saul Kaplan, Founder and Chief Catalyst at Business Innovation Factory.

Check out Tuesday’s interviews with:

Bernt Wahl, Executive Director of Brain Machine Consortium
Nigel Cameron, Tech/Futures Editor of UnHerd and President Emeritus
Joanne Moretti, SVP & Chief Marketing Officer at Jabil and General Manager at Radius Innovation and Development
Steven Waterhouse, Co-Founder of Orchid Labs

Here's Monday’s interviews with:

Naveen Rajdev, CMO at Wipro
Annalie Killian, Catalyst and Amplifier & Engagement Director at sparks & honey
Nagesh Rao, Eisenhower Fellow & AAAS-Lemelson Invention Ambassador Advisor

New C-Suite Innovation & Product-led Growth Davos DisrupTV Executive Events Leadership Chief Customer Officer Chief Digital Officer Chief Executive Officer Chief Financial Officer Chief Information Officer Chief Marketing Officer Chief People Officer Chief Procurement Officer Chief Revenue Officer Chief Supply Chain Officer Chief Experience Officer

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MicroStrategy Makes Case for Agile Analytics on its Enterprise Platform

Doug Henschen

Former Vice President and Principal Analyst
Constellation Research

Doug Henschen is former Vice President and Principal Analyst where he focused on data-driven decision making. Henschen’s Data-to-Decisions research examines how organizations employ data analysis to reimagine their business models and gain a deeper understanding of their customers. Henschen's research acknowledges the fact that innovative applications of data analysis requires a multi-disciplinary approach starting with information and orchestration technologies, continuing through business intelligence, data-visualization, and analytics, and moving into NoSQL and big-data analysis, third-party data enrichment, and decision-management technologies. Insight-driven business models are of interest to the entire C-suite, but most particularly chief executive officers, chief digital officers,…...

MicroStrategy promises quick-to-deploy data-discovery and departmental capabilities that sync with its venerable, enterprise-scale platform.

MicroStrategy is back. After a few years in which the business intelligence and analytics company made little noise, it’s back with new energy, new capabilities for ad hoc and departmental users and a new educational push around what it calls its “Map of the Intelligent Enterprise.”

MicroStrategy has flourished at the top of the BI market for more than two decades, specializing in enterprise-wide deployments at truly high scale – supporting thousands and, in some cases, tens of thousands or even hundreds of thousands of users. As smartphones and tablets emerged in the 2008-2011 timeframe, MicroStrategy was the first mover. To this day MicroStrategy remains at the forefront of delivering mobile BI capabilities with fluid, device-native interactivity.

The shift that MicroStrategy largely missed (along with many other established BI vendors), was the rise of agile, self-service capabilities aimed at mainstream, departmental and line-of-business users. That’s the void that Tableau, Qlik and, more recently, Microsoft PowerBI, have happily filled. Like other established vendors, MicroStrategy responded with ad hoc data discovery and data visualization capabilities of its own. Yet many MicroStrategy customers bowed to grassroots demand and embraced third-party self-service options for their ease of use.

What the self-service crowd learned, as use of their tools spread, is that high-scale deployments and establishing a single source of truth are not so simple. These vendors have been adding data-governance features, administrative controls and management capabilities to turn tools into what they now describe as platforms.

MicroStrategy’s strength, meanwhile, was long been its platform. At last week’s MicroStrategy World event in Las Vegas, company Founder, Chairman and CEO, Michael Saylor, vowed that the company is now ready to deliver “massive departmental productivity [that] syncs with the enterprise.”

Part of delivering on that promise rests on the product. MicroStrategy Dossier, introduced last fall, goes beyond dashboards to deliver collaborative analytical applications and workbooks. A revamped MicroStrategy Desktop interface introduced at the World event better supports data discovery. And a new Workstation interface was added to help power users quickly build and scale up enterprise content.

Beyond software, Saylor said that enterprise software companies have to provide “service and technique that ensures customer success.” Technique is about best practices, and that’s where MicroStrategy’s “Map of the Intelligent Enterprise” comes in. A printed, 16-inch by 23-inch fold-out copy of the map was provided to every MicroStrategy World attendee. Saylor referenced a digital version of the map throughout his keynote, making the point that the platform has to be deployed and used in the right way if it is to deliver a single version of the truth that empowers “pervasive analytics.”

Detailing the roles that should be in place, for example, Saylor said organization should have a lead analytics architect – just one person in charge -- to create, publish and optimize the data layer so there aren’t multiple versions and interpretations of the truth. And there should be a lead application architect – again, a single point person – who sets standards for analytical applications so there aren’t overlapping and conflicting approaches that contribute to performance problems.

Large enterprises tend to have most of, if not all, the architectural and administrative roles detailed in MicroStrategy’s Map of the Intelligent Enterprise, Saylor told me. But where deployments have failed, where performance is not as expected and where data inconsistencies have cropped up, Saylor said MicroStrategy tends to discover overlapping responsibilities and inconsistent standards, interpretations and approaches.

To address these breakdowns in best practices, MicroStrategy has stepped up its educational resources, including free options, for both customers and partners who can help customers get the most from their deployments. It’s also eyeing certifications and more community based training opportunities, but the first step is raising awareness of the resources already available.

MyPOV on MicroStrategy World

MicroStrategy World presented what I saw as an honest discussion of what’s required for customers to get to proverbial intelligent enterprise. Instead of pretending that products alone can deliver success, Saylor stressed that MicroStrategy’s improved ad-hoc data-discovery and departmental capabilities will be no better than disconnected Excel spreadsheets or Tableau dashboards if they don’t draw on a single source of truth and are not synchronized back to the enterprise environment as usage scales up.

MicroStrategy's vision for how ad hoc and departmental assets draw from and sync with the
enterprise as the scope of consumption grows.

I got the sense that most of the attendees of MicroStrategy World -- more than 2,000 executives from enterprise customers ranging from AIG, Coca-Cola and Merck to Citi, Optum and UBS – were comfortable with what I would characterize as top-down messaging aimed at executives, analytics leaders, project managers and administrators of high-scale, enterprise-wide deployments.

As for the ease of use and agility of the new ad hoc and departmental capabilities, including Dossier, Desktop and Workstation, these were briefly demonstrated during Chief Technology Officer Tim Lang’s second-day keynote, but it was a fleeting glimpse. Yes, there were detailed track sections and hands-on workshops for those interested, but if MicroStrategy is truly serious about retaining (or regaining) the self-service ad hoc and departmental workloads, it could do a better job of demonstrating and even celebrating its “massive departmental productivity” on the main stage. Show me, don’t tell me. Let the live and video-taped customer testimonials include more front-line analysts, Dossier builders and ad hoc explorers rather than just the top-dog analytics executives.

The passion at MicroStrategy World was most evident around what MicroStrategy has always done best -- providing the platform for powerful analytical applications deployed at high scale. The company’s prowess with a variety of consumption options was also on display, now extending from multi-screen conference room displays at the high end down to smart phones and smart watches.

MicroStrategy is also pushing the envelope of voice interaction, with Saylor describing Amazon Alexa as the third most important platform to emerge after iOS and Android. Here’s where MicroStrategy and others could start to redefine self service. As I note in my recent report, “How Machine Learning and Artificial Intelligence will Change Business Intelligence and Analytics,” line-of-business users don’t necessarily want to have to open up a report or interpret a data visualization. And as the speed of decision making increases, there may be no time for such interaction. In that world, users will want to be able to simply ask questions and get precise answers and recommended actions.

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News Analysis - Informatica Delivers the Industry's Next-generation iPaaS

Holger Mueller

Vice President and Principal Analyst
Constellation Research

More and more software is moving to the cloud and it allows vendors to redefine the value proposition of their software during the process. A good example is Informatica with its integration product capabilities.

So let's dissect the press release in our custom style – it can be found here:

Redwood City, Calif., Dec. 19, 2017 – Informatica, the enterprise cloud data management leader, today announced the general availability of its next-generation integration Platform as a Service (iPaaS) solution, Informatica Intelligent Cloud Services.
MyPOV – Good intro, we know what this is about and General Availability – GA – is always a key milestone for enterprise software. Extra kudos for shipping in time as communicated at Informatica World in Spring of 2017.

Enterprises can leverage the new iPaaS to power their data-driven digital transformation in a multi-cloud environment, and benefit from a flexible, cloud-based integration and data management solution that is built to scale at the speed of business. Informatica Intelligent Cloud Services offers a unified and modern user experience across iPaaS integration patterns and is supported by a modular, microservices architecture that is customizable and easy to navigate. The new iPaaS experience is leveraging the CLAIRE engine to provide AI metadata driven recommendations to automate and accelerate integration and data management work.
MyPOV – A functionality rich paragraph describing what the Informatica iPaaS does: multi-cloud data driven transformation and integration. Good to see the AI angle with the CLAIRE engine.

The IT landscape is evolving to support complex business needs around data management and current solutions are not enough. Enterprises are rethinking iPaaS usage to drive innovation across front end and back end, supporting all levels of users.
MyPOV – Correct, enterprises are realizing, that they have a new kind of integration problem at hand. On the bright side they now have the option to move the integration engine platform from on premises to the public cloud, a key inflection point for the iPaaS industry.

[…] Informatica Intelligent Cloud Services is built on a foundation of trust, with security and privacy as an integral part of the infrastructure successfully audited for compliance with security regulations like HIPAA and certifications like SOC2 type II, SOC3 and more. Additionally, enterprises will be able to use Informatica Intelligent Cloud Services as part of a solution that is compliant with the upcoming General Data Protection Regulation (GDPR), which goes into effect May 2018. For more details check out trust.informatica.com.MyPOV – When enterprises move automation to the cloud, they immediately have questions on security and privacy. Good to see Informatica addressing these proactively in the press release, with extra kudos of mentioning the looming GDPR deadline.

To learn more, participate in the Informatica virtual cloud event, "iPaaS Reimagined: Informatica Intelligent Cloud Services Launch," featuring a keynote, deep-dive demos, live expert chat, and insightful sessions on a range of cloud/hybrid topics.
MyPOV – Always good to see virtual, on demand events, which take out the demand of calendar synchronicity for attendants.

Overall MyPOV

Good to see the progress by Informatica moving the integration portfolio to the cloud, as announced at Informatica World. CxOs are ready to use new platforms to integrate their applications, as the enterprise automation portfolio more and more disintegrates between on premises and multiple clouds. In the past integration tools would stay on premises, as the core of automation resided there, going forward we see more automation happening across several clouds, resulting in multi-cloud landscape. Such a landscape makes on premises based integration tools obsolete and expensive, as e.g. network transfer rates are one of the key costs in a hybrid cloud environment. It's early days for Informatica' s assistant – CLAIRE – so it will be interesting to see first use cases. The technology and demand are both promising, it's up to vendors to make it happen.

On the concern side, this is a new release of software, so the usual cautions apply to adoption. CxOs need to be aware of potential quality risks as early adopters, or work closely with early references of fast followers. Informatica has a good track record from a quality perspective, but integration is a binary animal, either it works – or it doesn't.

But for now, congratulations to Informatica to move its integration portfolio to the cloud. A key new option for CxOs to solve the integration puzzle of their enterprise automation, and an early entry in the cloud based iPaaS market. Stay tuned.

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