Innovation World: The Woz

We had a brief address by Joseph Lagioia, SVP and head of consulting for Satyam (a big partner of Software AG, and winner of this year’s partner innovation award), then he joined a panel discussion along with winners of the Software AG customer innovation awards: Jim Kern of Morgan Stanley, Robert Rennie of Florida Community College, and Bruce Beeco of Cox Communications.

Steve Wozniak at Software AG conferenceThe real draw here at this morning’s keynote, however, is Steve Wozniak, co-founder of Apple. He spoke about how he got started in technology and innovation, from high school days where he designed his first minicomputers on paper but couldn’t afford the parts, to college where he had his first opportunity for some serious computing power.

He described meeting Steve Jobs and how they became best friends with a common love of new technology, and some of the differences between the two: Wozniak was a grounded, practical engineer working at HP, and Jobs was skipping class at college and dreaming new ideas. While Jobs was up in Oregon at college, Wozniak saw a Pong game for the first time, then built his own version using his TV at home; Jobs saw that and took a job at Atari, then pulled Wozniak on a crazy project to build the Breakout game in 4 days with 45 chips.

Wozniak wanted to be an engineer for life and build stuff; his ideas came from exposure to a crazy mix of new technologies, like the Pong game and ARPAnet. Jobs was the corporate builder, recognizing the monetary value and finding market for what Wozniak was building. As Wozniak kept building and eventually created a keyboard-driven microcomputer, he started to see the impact that programmers would have, and the two of them came to the idea of a pre-made home computer that used a keyboard instead of switches, and hooked up to a TV as a monitor, allowing hobby developers to get started: the Apple I. Wozniak designed the Apple II shortly after that, then made the leap and quit his job at HP to create Apple with Jobs. No surprise, Wozniak did the engineering, making the products work well, and Jobs did the design, making the products look good. They went off to their first Computer Electronics Show in Vegas, where they met the connections that led them to Xerox PARC where they saw a graphical user interface for the first time: although a lot of great engineering was already in the Apple products, this was the thing that set them apart in the long run. Now, Apple is known for two things — the beauty of the user interface, and the beauty of the product design — while all the great engineering is the silent partner that drives it all.

We all know a lot of this story, but it’s completely inspiring to hear it from Wozniak directly: the things that he observed around him that sparked ideas, and his drive to make these ideas into reality. Completely inspiring.

Innovation World: ChoicePoint external customers solutions with BPM, BAM and ESB

I took some time out from sessions this afternoon to meet with Software AG’s deputy CTOs, Bjoern Brauel and Miko Matsumura, but I’m back for the last session of the day with Cory Kirspel, VP of identity risk management at ChoicePoint (a LexisNexis company), on how they have created externally-facing solutions using BPM, BAM and ESB. ChoicePoint screens and authenticates people for employment screening, insurance services and other identity-related purposes, plus does court document retrieval. There’s a fine line to walk here: companies need to protect the privacy of individuals while minimizing identify fraud.

Even though they only really do two things — credential and investigate people and businesses — they had 43+ separate applications on 12 platforms with various technologies in order to do this. Not only did that make it hard to do what they needed internally, customers were also wanting to integrate ChoicePoint’s systems directly into their own with an implementation time of only 3-4 months, and provide visibility into the processes.

They were already a Software AG customer with the legacy modernization products, so took a look at their BPM, BAM and ESB. The result is that they had better visibility, and could leverage the tools to build solutions much faster since they weren’t building everything from the ground up. He walked us through some of the application screens that they developed for use in their customers’ call centers: allow a CSR to enter some data about a caller, select a matching identity by address, verify the identity (e.g., does the SSN match the name), authenticate the caller with questions that only they could answer, then provide a pass/fall result. The overall flow and the parameters of every screen can be controlled by the customer organization, and the whole flow is driven by a process model in the BPMS which allows them to assign and track KPIs on each step in the process.

They’re also moving their own executives from the old way of keeping an eye on business — looking at historical reports — to the new way with near real-time dashboards. As well as having visibility into transaction volumes, they are also able to detect unusual situations that might indicate fraud or other situations of increased risk, and alert their customers. They found that BAM and BI were misunderstood, poorly managed and under-leveraged; these technologies could be used on legacy systems to start getting benefits even before BPM was added into the mix.

All of this allowed them to reduce the cost of ownership, which protects them in a business that competes on price, as well as offering a level of innovation and integration with their customers’ systems that their competitors are unable to achieve.

They used Software AG’s professional services, and paired each external person with an internal one in order to achieve knowledge transfer.

Innovation World: Susan Ganeshan on webMethods product roadmap

Susan Ganeshan, Software AG’s SVP of product management/marketing, gave a well-attended breakout session on the webMethods suite roadmap and vision. I had a bit of a preview at a breakfast meeting this morning with Mike Lees, director of BPM product marketing, and hope to get a demo of the new major release before too much longer.

Ganeshan started with a quick review of what they’ve released this year — which likely most of the customers in the audience have not yet implemented — that adds quite a bit of functionality. From her presentation, the major additions/improvements in 7.1 were:

  • BPM Suite
  • Eclipse Tools
  • Human Workflow
  • WYSIWYG App Design
  • Process Analytics
  • SOA Registry
  • Introduction of ESB
  • Standards: WS-I, SOAP, HTTP, JMS, etc
  • Role Based Partner Admin & Monitoring

7.1.2, released in September, fixed a large number of bugs in 7.1, plus added more functionality:

  • Usability
  • Performance
  • Stability
  • Bi-directional
  • XPDL

In spite of the insistence yesterday that they’re a middleware vendor, and their strength in the integration-centric BPM sector, they’re adding more capabilities in the human-centric BPM side. I’m not sure if that will be enough to push them up in the Gartner BPM magic quadrant (which considers integration-centric and human-centric vendors together), or to get them onto move them up in the Forrester human-centric BPM wave, but it’s interesting to note that they’ve come from essentially no human-facing BPM a couple of years ago to at least being a blip on the radar now.

They also have a new offering, webMethods Insight, for discovering and managing services and their availability, plus the CentraSite ActiveSOA release that was discussed yesterday; CentraSite ActiveSOA will able to federate services repositories as well as allowing you to set rules-based policies around service provisioning. She announced another upcoming product, webMethods Mediator, for service mediation functionality without deploying a dedicated server to mediation.

webMethods Designer 7.2 has moved the developer environment into Eclipse (to be released next month), which feeds into the Eclipse-based environment that will be seen in webMethods 8, to be released in 2009. webMethods 8 will provide:

  • Customizable, extensible eclipse-based development environment including a set of tools: unified asset design, visual flow editor, WSD editor, document editor, visual mapping, JMS trigger editor, BPEL editor (through a partnership with another, unnamed company), and built-in debugging inherent to the Eclipse environment. By the way, she said (explicitly for attribution): “BPEL is misnamed. It’s not a business process execution language, it’s a service execution language”.
  • In the ESB layer:
    • ESB and integration server with integrated BPEL engine, XML security services, XML schema enhancements, single sign-on, WmPublic enhancements, Subversion VCS support
    • Broker and JMS enhancements including policy-based broker clustering, security enhancement, and JDNI support.
    • BPEL 1.1/2.0 support, plus a number of other new standards support such as SAML 1.1 and SOAP over JMS.
    • For B2B trading networks, data archival management and visibility, dashboards and reporting via Cognos integration, and managed file transfer via another partnership.
    • EDI enhancements including additional adapters such as the previously discussed adapter
  • In the BPM layer:
    • webMethods Align, a browser-based collaborative modeling tool for process discovery and design: like Lombardi’s Blueprint, but (possibly) inside the firewall. Within Align, you can define the goals of the process, then drag and drop steps directly in a  BPMN-like process map view. More information can be added to each step to, as she says, “allow the business analyst to tell IT what needs to be done here”. She stated that this will have a single shared process model with the executable version, so no round-tripping considerations. You can invite other people to collaborate, which gives you a shared whiteboard sort of capability where you can all work on the process at the same time. Early days for this product; they don’t about pricing, and may consider providing it as a hosted service (although that may cause an issue with a shared model). My advice: give it away for free, since charging for it won’t drive a significant amount of revenue anyway, but a free version will drive adoption across enterprises.
    • Forms-driven processes using MS Infopath or Adobe Forms, which will (IMO) strengthen their human-centric offering
    • Optimization and simulation, including the use of real-time data.
    • User-generated mashups (which she referred to as “user derived applications), allowing a user to create and customize a portal workspace, including interaction between components, then save and share that workspace.
    • Ad hoc process collaboration, allowing a user to step outside the structured process for review or escalation while still working the process in an audited environment.
    • Monitoring, reporting and analytics through Cognos integration.
  • Across the webMethods suite, they’ve improved installation and maintenance.

I’m excited to see the new BPMS release, especially Align, in the coming months.

They have a site for submitting product ideas, Brainstorm, which is community-driven: you can actually vote on the ideas that other people submit. Right now, you need a registered login, but they will soon allow anonymous submissions.

Innovation World: Dan Crowe of

Dan Crowe, chief product officer of, gave the final keynote of the morning on how they’re using Software AG to bring together business and IT.

As an online business, technology is obviously a big part of their business. In case you don’t know who AutoTrader is, they’re an online classified ad site for vehicles, primarily in the US, competing with other auto sites but also with traditional paper media. Not only do individuals offer their cars for sale here, but auto dealers use it as an advertising platform for much higher volumes of used vehicles for sale. Their site has a lot of stickiness: on average, a customer in the key 18-34 demographic will spend 65 minutes on their site, more than any of their competitors, in part due to the variety of tools and information available in addition to the cars for sale.

Their key strategic IT objectives are to innovate faster than their competitors, extend their platform presence in the auto remarketing value chain, leverage data to demonstrate value, workflow-enable their back office systems, and build a scalable multi-business platform for future growth. They’ve implemented BPM in several areas of their business, with the next target being the order-to-cash process, and have implemented SOA and master data management. They’re currently in a transition from very siloed systems to a more mature, fully-integrated value chain in order to improve customer service, streamline their operations, improve collaboration between IT and business, and increasing competitive differentiation in order to keep their business lead.

They’re branching out into new car advertising, allowing customers to compare the deals on equivalent new cars at different dealerships in their area; you still want to go out and test-drive it first, but they want to be the place where the potential buyers come to find where to go in order to kick the best tires.

Innovation World: Day 1 keynote

Karl-Heinz Streibich gave the opening keynote; some of the same messages as his address at the media and analyst forum yesterday, plus some messaging about how SOA is a paradigm shift, and the Net generation entering the workforce is a strong driver for modernization and integration. He made the point that process innovation outranks product innovation, and how BPM is the future: companies who apply process management are more agile (hence more competitive) and have more optimized processes (hence are more efficient).

He finished up by referring to their new process frameworks — vertical templates including process models, user interfaces, business rules and KPI definitions for building solutions quickly — but didn’t elaborate; however, they issued a press release today discussing them in more detail. Software AG is providing the following process frameworks:

  • Order-to-Cash
  • Procure-to-Pay
  • Payments
  • Underwriting
  • Product Recall
  • New Product Introduction
  • Monthly/Quarterly Closing
  • Employee On-boarding

In addition, their partners are providing frameworks for automotive claims management, electronic check processing, claims management, field services jeopardy management, invoice dispute management, and telecommunications service provisioning.

We also heard from Dr. Peter Kürpick, with much the same message as he delivered yesterday at the analyst forum, although I think that the animated graphics in his slides were nicer today, especially the one showing a process orchestrated across several organizations participating in the end-to-end supply chain. He talked about some of their customers and how they’re improving their business processes using SOA and BPM.

I believe that he had an error in one of his slides, however: in showing how Software AG is a leader in several categories of the analyst reports, and their competitors are not, he showed that they’re a leader in Forrester’s human-centric wave but TIBCO is not. I’m looking at the the wave report right now, and TIBCO actually places higher in the leader category than Software AG. I may have mis-read the slide, it went by quickly and I didn’t have a chance to snap a photo.

He finished up highlighting some of the things coming out of their research lab that will be seen at the demo jam competition today, including BAM capabilities that can be viewed on the iPhone.

Innovation World: Analyst/Blogger Technology Roundtable

We left the analysts and press who focus on financial stuff upstairs in the main lecture hall, and a smaller group of us congregated for a roundtable session with Peter Kurpick and a few other high-level technical people from Software AG. These notes are really disjointed since I was just trying to capture ideas as we went along; I have to say that some of these people really like to hear themselves talk, and most them like to wag their finger admonishingly while they do so.

Kurpick started out the session by talking about how Software AG has a product set that has SOA built in from the philosophy up, whereas many other vendors (like SAP) add it on for marketing purposes; I would say that the other vendors are doing it as much for connectivity as for marketing purposes, but it’s true that it’s not baked into the product in most cases. He didn’t use the phrase “lipstick on a pig”, but he sees that the challenge to the application vendors is that by tacking on a services later, it just serves to expose the weaknesses of their internal architecture when the customer wants to change a fundamental business process.

Frank Kenney of Gartner disagreed, saying that adding services to the applications gives those vendors a good way to sell more into their existing customers, and that most organizations don’t change the basic business processes provided by the application vendors anyway. (Of course, maybe they don’t change them because it’s too difficult to do so.) Most customers just want to buy something that’s pretty close to what they want already, not orchestrate their own ERP and CRM processes from scratch, especially for processes that don’t provide competitive differentiation.

Kurpick responded that many organizations no longer own their entire supply chain, and that having an entire canned process isn’t even an option: you have to be able to orchestrate your business process by picking and choosing functional components.

Ian Finley of AMR Research discussed the impact of SaaS applications and services on this equation: if you can get something as a service at a much lower capital cost, even if it’s only a portion of your entire business process, that has value. Other opinions around the table (from people who didn’t bother to set up their name tent and made some rash assumptions about their own fame) agreed that SaaS was an important part as customers modularize their business processes and look for ways to reuse and outsource components. SaaS and open source both provide a way to have lower up-front costs — important to many organizations that are cutting their budgets — while offering a growth path. Someone from Forrester said that they are seeing four disruptive trends: SaaS, offshore, open source, and SOA. All of these mean taking focus away from the monolithic packaged applications and providing alternative ways to compose your business processes from a number of disparate sources.

What does it mean, however, for customers to move to a distributed architecture that is served by a variety of services, both inside and outside the firewall? Some organizations believe that this means giving up some control of destiny, but Kenney feels that control is an illusion anyway. I tend to agree: how much control do you have over a large ERP vendor’s product direction, and what choices do you have (except stopping upgrades or switching platforms, both painful alternatives) if they go somewhere that you don’t want to go? I think that the illusion of control comes from operational control — you own the iron that it runs on — rather than strategic control, but ultimately that’s not really worth much.

Ron from ZapThink and Beth Gold-Bernstein of ebizQ started a discussion on federation of ESBs, repositories and registries, and how that’s critical for bringing all of this together in a governable environment. Susan Ganeshan (Software AG product management) discussed how their new version of CentraSite addresses some of those issues by providing a common governance platform. Distributed systems are inherently complex because they work on different platforms that may not have been intended to be integrated, and may not have any sort of federated policies around SLAs, for example. Large organizations are drowning in complexity, and the vendors need to help them to reduce complexity or at least shield them from the complexity so that they can get on with their business. SOA can serve that need by helping organizations to change the paradigm by thinking about applications in a completely different way, as a composition of services.

We shifted topics slightly to talk about how companies compete on processes: identifying the processes (or parts thereof) that provide a competitive differentiation. Neil Macehiter of MWD pointed out how critical it is for companies to use common commercial alternatives (whether packaged, SaaS or outsourced) for processes that are the same for everyone in order to drive down costs, and spend the money on the processes that make them unique. However, in this era of mergers and acquisitions, none of this is forever: business processes will change radically when two organizations are brought together, and systems will either be made to work together, or abandoned. Kenney told a story that would have you believe that no one gets fired for waiting to buy IBM or SAP or any of the big players; I think that you might not get fired, but your company might get eaten up by the competition while you’re waiting.

There’s a general impression that SOA is failing; not the general architectural principles, but the way that the market is being sold and serviced now. Large, high-profile projects will not attain their promised ROI; the customers will blame the vendors for selling them products that don’t work; the vendors will blame the customers for being dysfunctional and doing the implementation wrong; the SOA market will crash and burn; some new integration/service-oriented phoenix will rise from the ashes.

Innovation World: Media and Analyst Forum

I’m spending the morning at the media and analyst forum at Software AG’s user conference, Innovation World, in Miami. The first half of the morning covered mainframe modernization, plus a presentation by Miko Matsumura (who I met last week at the Business Rules Forum), Deputy CTO, on the state of SOA adoption. He’s just published a book — more of a booklet at 86 pages — on SOA Adoption for Dummies, continuing Software AG’s trend of using the Dummies brand to push out lengthy white papers in a lighthearted format. For example, chapter 10 is SOA Rocket Science, which covers three principles of SOA:

  1. Keep the pointy end up (instrumentation)
  2. Maintain upward momentum (organization)
  3. Don’t stop until you’re in orbit (automation)

He finished up with a discourse on SOA as IT postmodernism, casting postmodernism as an architectural pattern language: given a breakdown in the dominant metanarrative and the push towards deconstructionism, a paradigm of composition emerges…

After the break, we heard from Ian Walsh from webMethods product marketing to give us an overview of the webMethods suite:

  • webMethods BPM, including process management, rules management and simulation
  • CAF (composite application framework), for codeless application design and web-based composite applications
  • BAM, including process monitoring and alerting, and predictive management

He stated that the “pure-play” BPMS vendors (mentioning Lombardi, Savvion and Pega) are having problems because they sold on the ability to allow the  business to create their own processes quickly, but that doesn’t work in reality when you have to integrate complex systems. He also said that the platform vendors (Microsoft, IBM, Oracle) have confusing offerings that are not well integrated, hence take too long to implement. He mentioned TIBCO as a special case, neither pure-play nor platform, but sees their weakness as being very focused on events: good for their CEP strategy, but not good for their broader BPM/SOA strategy.

Walsh sees their strengths in both BPM and SOA as their differentiator: customers are buying both their BPM and SOA products together, not individually.

Bruce Williams was up next speaking on the BPM as the killer application for SOA. He’s a Six Sigma guy, so spent some time talking about BPM in the context of quality management initiatives: if we can manage processes well, we can achieve our business goals; in order to manage processes, we need some systems and infrastructure. He defines the killer app as being flexible and dynamic, not a fixed state or a system with unchangeable functionality. He sees BPM as being the language that can be spoken and understood by both business and IT: not the Tower of Babel created by technology-speak, but how process ties to business strategy.

Logistics are not great: they’ve billeted me in the down-market Marriott Courtyard next door rather than at the Hyatt where the conference is being held (I had to change rooms due to no hot water, can’t run the a/c at night because of the noise, and I have a view — complete with sound effects — of the I95 onramp), and there’s no wifi or power in the lecture hall. There’s supposed to be wifi, but it’s a hidden, protected network that only some people seem to be able to connect to (yes, I added it manually to my wireless network settings). They’ve promised us power at the desks and some assistance with the wifi after lunch.

In case my policy about vendor conferences isn’t crystal clear from previous posts, Software AG is paying my travel expenses to be here, although they are not compensating me for my time nor do they have any editorial control over what I write.

Forgotten posts

I was in Windows Live Writer this morning (the offline tool that I use for writing blog posts) and noticed that I had totally forgotten to post the last two from Integration World last week. I’ve published them on the dates that they were written, and you can find Tata’s short presentation on next-generation SOA here, and Bruce Williams’ presentation on process improvement here.

Sorry about the slip; I’m definitely getting conference fatigue, and am currently at what I hope to be the last one for the year (since I have to skip SOA India).

Integration World Day 2: Continuous Process Improvement, Continuous Business Transformation

Bruce Williams, SVP and GM of BPM Solutions for Software AG/webMethods talked about BPM and how it enables business transformation. Bruce, who I had a chance for an in-depth chat with yesterday, comes from a solid Six Sigma background — including writing books on Six Sigma and Lean — which makes his focus on process improvement a natural. He started with a timeline of quality management from the 1950’s PDCA through TQM, BPR and other trends to the current focus on Lean Six Sigma. There are a lot of tools and techniques that can be used to improve processes, including BPMS’ that can be used to handle the automation, monitoring and governance side of things.

He outlined three steps to process performance happiness:

  1. The “B” in BPM – this is about your business. Considering that I give a course called “Making BPM Mean Business”, I’m totally on board with this. Bruce’s points included knowing where value is created, measuring what’s happening in the business processes throughout all stages of improvement, ensuring that the voice of the customer is heard, and allowing the business to determine the goals and drive the agenda of process improvement.
  2. Build to an architecture. In addition to models, methodologies and leveraging existing systems and assets, this also includes developing expertise in process and integration. I find that the process improvement centre of excellence approach works well in a lot of organizations, which typically includes both architecture and the expertise around it.
  3. Implement incrementally, improve continuously. Incremental implementation is something that I always recommend: not only do you get benefits earlier, but the vision of what needs to be implemented will change as soon as your first project goes into production.

This was a pretty short presentation, and they moved on quickly to the customer innovation awards. The winners were Corporate Express in the productivity category, Motorola in the business agility category, Lenders First Choice in the innovation category, DSM in the ROI category, and Satyam in the partner innovation award.

Karl-Heinz Streibich gave a brief closing address; the remainder of the day is breakout sessions and the conference finishes at the end of today, so this was the last general session.

Integration World Day 2: Next Generation SOA

Santosh Mohanty from Tata gave a presentation on SOA, with a bit about the current generation, and how to move on to the next generation. Tata is a pretty major sponsor of the conference: I think that webMethods created a new “diamond” level of sponsorship just for them, which gives them both the opening night reception plus a keynote this morning.

His lessons for achieving next generation SOA:

  • Define agility controls.
  • Create an agile platform.
  • Articulate enterprise value in terms of efficiency, agility and adaptability.
  • Create a performance framework in order to create a performance-driven organization. This ties in strongly with webMethods message about “measure first” and the focus on BAM and analytics.
  • Create business and IT collaboration. Much easier said than done, and I’m not convinced that business needs to be all that involved in SOA since it’s really not relevant to most business people how the services get delivered, just that they are delivered. Of course, I see BPM and SOA and two distinct technologies; those that see BPM as just an extension of SOA will see business-IT collaboration as a necessity, and I think that Tata may fall into this latter camp.
  • Establish the right governance.

Tata was (I believe) one of the first companies to achieve CMM level 5 certification, and it makes sense that Mohanty’s first point is about control. It won’t do much to foster emergent applications, however. I think that all the large systems integrators are in a similar position: although there’s lots of work for them around legacy modernization and creating services, the current generation of BPM tools has to scare them, since it allows organizations to do a lot more of their own codeless development of business processes.