Procure-To-Pay Best Practices: Cut The Approval Levels, Improve The Monitoring

Duncan Jones

Earlier this week I was in Milan, speaking at the CPO Forum event about the importance of good procure-to-pay (P2P) systems to deliver sourcing's theoretical savings into real bottom-line improvements.  As England's ex-goalkeeper Robert Green showed us last week, savings opportunities aren't the same as real savings. :( 
http://news.bbc.co.uk/sport1/hi/football/world_cup_2010/matches/match_05

I had some subsequent discussions with attendees about P2P best practices and how you maximize adoption by business users. One tip relates to the optimum number of approval levels — my conclusion is: the fewer the better. As one procurement director put it, "We empower our people, and show that we trust them, but not unconditionally. We monitor individual expenditure closely, so each person knows that we may subsequently ask him to justify anything exceptional that shows up in the report." His firm had actually cut consumption of health & safety equipment by 20% by eliminating pre-approval and replacing it with exception reporting. He'd also streamlined the MRO procurement process. "We approve the maintenance work order, but then we used to have to separately approve the parts used to do the job.  I convinced my colleagues that the second approval was a waste of time."

In contrast, what can happen if you have too many approval levels?

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What SQL Cannot Do

Boris Evelson

I recently asked my Twitter followers if they had good examples of queries, business questions that SQL can't do. It turns out a better question is "what SQL can't do easily", so I thought I'd share with everyone what I heard and found. Seth Grimes was the first one to provide an excellent answer with some informative examples - thank you, Seth! I also found very useful articles on typical SQL challenges such as avoiding multiple duplicate sets in your SQL results, and why NULLs create tons of headaches for SQL coders.

There's also a typical SQL challenge with ragged, sparse, unbalanced hierarchies and dimensions. For example, a retail store, a wholesaler or a distributor with thousands of products, and a manufacturer with thousands of parts often struggle with dissimilar data. A pencil in an office supply store does not have the same descriptive attributes (lead type, for example) as a calculator (scientific, financial, etc.) or an office chair (number of wheels, etc.). Or a tire in a car manufacturing supply chain does not have any common descriptive elements (rubber grade, width-to-height ratio) with gear boxes (automatic vs. manual, 4 or 5 speed, gear-to-gear ratios, etc). When looking for correlation between two entities (for example, what is a potential product quality issue that is making my sales go down?) in cases with disparate, dissimilar products (as in retail products or manufacturing parts), the same SQL query cannot work for all products or parts. One would be forced to write multiple SQL queries for each product or part type to find such a sales/quality relationship.

Risk Professionals' Window Of Opportunity

Chris McClean

In my ongoing work with risk management professionals, I've been encouraged to see how quickly the role is growing in influence and responsibility in today's business environment (even though the drivers for that elevation are often disastrous). Along those lines, I read a great article this morning in StrategicRISK, discussing the window of opportunity for risk experts, aptly entitled Keep Your Eyes on the Prize.

The article quotes the Institute of Risk Management's deputy chairman, Alex Hindson, who says that top executives and boards of directors are looking for risk management guidance, and if risk experts in their organizations can't step up to fill that role in their "window of opportunity," it will be filled instead by auditors, finance professionals, or external consultants.

In my recent engagements with Forrester's clients in risk management, I've certainly seen a lot of interest and participation from other functions in the business - most notably audit and IT. And just last week, my colleague Craig Symons published a report explaining key issues in risk management for the CIO.

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The Biggest Problem With SOA Isn't Really About SOA

Randy Heffner

I'll soon have a client report out with interesting Forrester data about how SOA adoption continued apace during the Great Recession. In the meantime, Forrester partnered with TechTarget on a different SOA survey, primarily to TechTarget's readers, wherein we asked a wider range of SOA questions. The bottom line of all this data is that SOA is alive and well.

SOA's strong health is not a surprise (at least not to Forrester), but something else very interesting came out of the survey. To the question, "What is the most significant challenge you are facing with your SOA project/initiative?" the top response was not really about SOA. Instead, by a 2:1 margin over the next response, the biggest challenge was, "Designing how to do SOA in an integrated way with other initiatives (e.g., BPM, events, BI, rules, etc.)." (I describe this in more detail in a write-up over at SearchSOA.com -- you have to register to read the full article.) 

In other words, people are realizing that, in a multi-technology world, siloed approaches to individual technology areas won't cut it. This is the fundamental insight driving Forrester's development of Digital Business Architecture (see Forrester report) and Business Capability Architecture (go to blog post or to another blog post).

Oh and to see more of the data from the TechTarget/Forrester Research State of SOA Survey for 2010, see this write-up by SearchSOA's Matt DeBarros.

How Mature Is Your Firm's Use Of Social Technologies?

Alex Cullen

Social technology, which includes blogs, microblogging (Twitter), social networking tools, and next-generation collaboration platforms, is a fundamental shift in how businesses use technology. As Forrester describes in Groundswell, your customers are becoming empowered through their use of these technologies, and your business must adapt to this changing relationship. And in our forthcoming book, Empowered, we examine how the people within your business are driving business impact through their use of these same technologies. 

Grass-roots experimentation and use by your business’s staff is good – but real business impact is when your business adopts and uses these technologies. This requires your business execs to put in the frameworks, guidelines, coordination, and governance to maximize benefit while prudently managing risk. 

Forrester is embarking on research to develop a Social Technology Maturity Benchmark that incorporates these steps. Because maturity will be an important issue for you in your role of charting your firm’s business technology strategy, we’d like your input on this. Colleagues in Forrester’s team serving Interactive Marketing professionals are conducting a survey of both business and IT leaders, including CIOs, Infrastructure and Operations professionals, Sourcing & Vendor Management professionals, and Enterprise Architecture professionals. Here is their introduction to this survey:

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Smart Meter In Utilities – The Lighthouse For Smart Computing

Holger Kisker

Some days ago at Forrester’s IT Forum in Lisbon (June 9-11) I gave a presentation together with my colleague Andy Bartels on the IT market recovery (we predict a 9.3% IT market growth in 2010) after two economically challenging years in 2008/9. In fact, we were making the point that the market rebound we currently see is not simply a recovery but the beginning of a new IT hyper growth phase fueled by a new wave of innovation.

A strong driver of this innovation is what we call Smart Computing at Forrester: the integration of physical world information into intelligent IT-supported business processes in 4 steps: Awareness (via new sensor technology), Analysis (with advanced BI solutions), Alternatives (including rules and process engines) and Action (in industry business applications), plus a 5th feedback loop of Auditability for tracking and learning.

A well-known example of smart computing solutions is smart metering in the Utilities industry. In another presentation in Lisbon, a colleague asked the audience, a room full with all the leading IT service companies, who all had an initiative running with smart metering – everyone in the room raised their hands. Then he asked who actually had more than 1-3 (pilot) projects running – and almost no one raised their hand.

Is smart metering just hype that everyone is jumping on or what is the reality of the lighthouse example of smart computing at this point in time?

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Empowered Customers Need Empowered Employees Need Empowered IT

Ted Schadler

Groundswell technology comes to consumers first. At home, we get social, mobile, video, and cloud services pitched to us 24x7. Facebook, Android, iPad, Foursquare, Google, YouTube, Office Web Apps, Twitter. The list is endless and growing every single day. Empowering technologies like these will always come to consumers first. Why? Because it's a wide-open market. A single developer can build an application that changes the world from their broadband-connected bedroom.

All this technology puts tremendous power directly into the hands of your customers. Your customers often have more information than your sales team — or medical staff — does. They can also whack your brand from their smartphone, with video even, while waiting impatiently in line. They can get a recommendation from someone in their business network while listening to your pitch. Customers are empowered by information and connections. You'd better make sure you give customers better information than they can get elsewhere.

The only way to do that is to empower your employees to directly engage the needs and expectations of empowered customers. Only empowered employees can solve the problems of empowered customers.

Fortunately, your employees are not standing still. People are problem solvers. Left alone, your innovative employees (we call them HEROes — highly empowered and resourceful operatives) are building new solutions using these same groundswell technologies — and many others besides — to solve customer problems.

In fact, 37% of US information workers — employees that use computers for work — use do-it-yourself technology to get work done. Personal mobile devices. Unsanctioned Web sites like Skype or Google Docs or LinkedIn or Smartsheet.com. Unsanctioned software downloaded to a work computer.

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Why I'm Worried About Java's Future

John R. Rymer

Java's future is on my mind lately. Oracle's new ownership of Java prompts a series of "what will Larry do" questions. But more to the point, the research Mike Gualtieri and I have been doing on massively scaled systems makes me worry that Java technology has fallen behind the times.

This is not a "Java is dead" commentary but rather a discussion of issues as I see them. Java technology is alive and vitally important; we all must be concerned if its future direction isn't clear.

For me, Java's 2-gigabyte-per-JVM memory limitation symbolizes this gap. Volumes of application data are rising, but standard Java platforms still have a practical limitation of 2 GB of memory. I spoke with one customer that incorporates a search process into its app that alone requires 20 GB of memory. This customer employs servers with 6 GB of memory each but can only use this memory in 2 GB chunks, each chunk managed by a JVM in a scale-out architecture.

We've done pretty well with 2 GB JVMs until now. But as data volumes grow, this company (and others) are no longer well served by scale-out JVM architectures. Java technology should give shops the choice of scaling up the memory within an individual JVM as well. Why?

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New Global SaaS Adoption Data Shows Emerging Geographies Embracing The Deployment Model

Liz Herbert

Forrester recently surveyed nearly 3,000 technology decision-makers worldwide and found that emerging geographies -- Latin America, China, India, Russia -- are heavy adopters of software-as-a-service. [Source: Forrester's Enterprise And SMB Global IT Budgets, Priorities, And Emerging Technology Tracking Survey, Q2 2010.]

Latin America led with the highest rate of SaaS adoption, with 30% of companies reporting SaaS use. Latin America also reported a high percentage of budget going to SaaS at 12.4%. (For comparison, North America, where many SaaS deployment options initially saw traction, showed 25% adoption and represented 7% of overall software budgets.)

Other emerging geographies that reported high adoption included emerging Asian countries (China/Hong Kong/India/Russia). This group reported 21% SaaS usage and 8.9% of software budget going to SaaS. More established Asia Pacific economies (Japan/Australia/New Zealand) reported only 16% SaaS adoption and only 6.5% of software budget going to SaaS.

For more on the data including more details and more insight into additional geographies, look for our upcoming report.

Also check out our recent report, “SaaS Adoption 2010.”

Follow me on Twitter @lizherbert.

And share your thoughts!

Liz Herbert

Ten Tips From The Enterprise 2.0 Conference

Nigel Fenwick

This year’s Boston Enterprise 2.0 Conference highlighted good examples of how companies are tapping into social technologies to empower their employees. For example, Mitre Corporation showed how they have successfully developed a collaboration community using open source technology. The platform they developed enables them to deliver secure access to ideas, discussions and content for employees and guests. Meanwhile, CSC showed how they have driven greater collaboration across 49,000 of their employees in just 18 months, with a strategy focused on connect, communicate and collaborate. (Those of us in the audience even witnessed the in-field promotion of Claire Flanagan, CSC senior manager for knowledge management and enterprise social collaboration, to director – congratulations Claire!)

Among a number of great speakers, JP Rangaswami, CTO & chief scientist at BT Design, opened the conference with a powerful speech that was supported by an innovative approach to real-time animation of content – alas, while the speech was good, the visuals were distracting for many in the room. JP suggested that the age of the locked-down desktop is coming to an end, “enterprises must design for loss of control.” Re-iterating a refrain from George Colony, who suggests “bits want to be free,” JP advised, “if you don’t want it shared, don’t put it on a computer.”

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