Business Making Progress

My Live Twitter Q&A with @ProgressSW

Recently, I took part in a live Twitter Q&A with our official Twitter feed, @ProgressSW. For those who missed our online chat, we transcribed the Q&A so you can read what I tweeted about optimization, agility, and industry trends.

 

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Optimizing your organization

PRGS: What are the simplest and best practices we can put into place to improve our organizational agility?

Bates: Base all applications on an explicit model – so they can be understood, analyzed & rapidly changed

PRGS: What can we do to move from a reactive culture to a proactive, anticipatory organization?

Bates: Tap into the events in your business. Look for patterns that indicate impending opportunities and threats

PRGS: How is being able to predict and react quickly to shifts and crises in the biz environment improve org performance?

Bates: Org can reduce risk & continually optimize itself, e.g. deploy “nearest” truck – saving fuel

 

Competitive advantages and agility 

PRGS: What competitive advantages can our organization achieve through improving market intelligence and responsiveness?

Move before your competitors; increase profits 

PRGS: What risks are companies facing if they don’t focus on improving agility?

Bates: Your competitors will launch services first & adapt before you. You’re dead!

PRGS:  Can you give some examples of companies that have successfully translated improved agility into better overall performance?

Bates: Reliance Capital, BT and Dell – all on a panel with me at Revolution

PRGS: In what industries are advanced intelligence, agility and rapid response most critical?

Bates: Capital Markets, Banking, Telco, Supply Chain – to name but a few

PRGS: How can we leverage agility to create a better customer experience?

Bates: Detecting customer problems before they happen – makes 4 delighted customers

PRGS: Can you give some examples of organizations that have successfully turned crises into opportunities?

Bates: Plus markets will be speaking about real-time surveillance – avoiding rogue traders and market abuse

UBS has shown today what happens without proper real-time risk and surveillance. Our customers have responsive systems to protect them

 

Industry trends and pain points 

PRGS: What are the most important trends and shifts in the business environment currently, forecasts for the future? 

Bates: Self-learning systems that can provide intelligent suggestions to business users

PRGS: What do you think are the most pervasive operational pain points in organizations today generally?

Bates: Decisions take SO long. Also companies operating with 20^th Century models

PRGS: It’s hard to argue that improving organizational agility isn’t a good thing, so why isn’t everyone doing it?

Bates: It’s really hard! The data isn’t visible – lots of stuff on mainframes or legacy apps

Only Progress can light up that data and enable you to sense and respond to events & improve your processes

PRGS: What are the most common obstacles to improving operational intelligence, agility and responsiveness?

Bates:  Organizational – people are living in the 20^th Century

Technical – no visibility to the events running thru the org

PRGS: Thank you, @drjohnbates, for participating in our Twitter chat. We will see you next week in Boston for #ProgressRev!

Bates: Thank you @ProgressSW for asking some challenging Qs in the twitter chat. I look forward to #ProgressRev next week!!

"Rip & Replace" isn't pleasant, especially in the supply chain world

  
Picture the following: you are on a long haul flight from Sydney to London, because you have status you were able to get a seat in Business Class. You settle down nicely for your flight, stretch out, maybe have a glass of champagne and some mixed nuts. 3 hours into your flight you see the crew exit the plane, walk on the wing and start unscrewing the engine...how would that make you feel? Maybe that someone slipped something into that champagne. However that is what it is like when companies try to replace software systems in the middle of every day business. This is even more apparent when it comes to the supply chain space. The systems that sustain your supply chain have DIRECT impact on either your suppliers, distributors, customers, partners, just to name a few of the entities impacted. Yet, systems constantly evolve, improve and get more powerful. So what to do when it comes to upgrade or replace systems to get the most out of existing infrastructure and applications?

The first option is that you take out the systems and replace them with new systems. Painful, business does not stop while you take the time to take off line your systems and then subsequently have to implement, train and being utilizing the new systems. Your second option is to stick with your existing systems and constantly add new systems, patchwork style, to address your supply chain needs. This also adds complexity and lag to your ability to address your business needs. A recent article in the Supply Chain Management Review, mentions the importance of being flexible in the volatile world we work in. This remains a challenge when you rely on legacy systems and other applications that are not seemless tied together. Invariably, supply chains and enterprises must evolve and add greater functionality to their systems, otherwise they will be passed by more flexible supply chains.

So what to do? Supply chains and enterprises need to seek solutions that enhance their existing infrastructures. Solutions that can starting tieing together all the applications and technology investments they have made over the past decades. The reality is, businesses must continue to lean on their existing systems to ensure business keeps moving forward. In parallel they need to determine if there are applications and systems that can make what they already own better. Applications in the cloud or those that can layer on top of existing infrastructures are two methods of delivery that can allow these organizations to enhance existing systems without the down time and pain of rip and replace.

Can you afford to take down time for systems overhauls?

Progress Revolution gets an “A”!

The final day of Progress Revolution opened once again with phenomenal keynote luminaries. Captain Chesley “Sully” Sullenberger described his extraordinary landing on the Hudson River after hitting a flock of birds.  Sully attributed his monumental landing with his preparedness for emergencies through extensive flight training.  Also his composed style of leadership allowed him to keep calm and take charge during the emergency.  Sully is truly an inspiration to all of us and reminds us we must all be prepared to respond in critical situations.

 
  
 

Of course, how can we forget about Ben Zander’s incredibly animated keynote?  Zander instilled a positive outlook for life in everyone in the audience—to invent things that make us happy and to shout, “How fascinating!” when we make inevitable human mistakes.  Furthermore, Zander turned the Progress audience into the Progress choir as he conducted us while we sang “Happy Birthday” to Greg and Beethoven’s 9^th Symphony, “Ode to Joy.”

 

Progress Revolution was truly an unforgettable experience.  I truly wish everyone had an awesome last day at Progress Revolution and I hope you gave us an “A”!

Day 3: Onboard the Train to a Revolution

Day 3 opened up with an exciting panel featuring Mike Gualtieri from Forrester and customers from BT, Reliance Capital and Dell, facilitated by CTO, John Bates.  The three Progress customers provided cross-industry views on how changes in the business world have made it mandatory for them to become more responsive.  Dell remarked that the pace of business has quickened dramatically; the company has introduced 72 releases in the first half of this year versus 46 for all of last year.  In addition, Dell must be more prepared than ever to problem solve, as he must solve up to “6 crises per week.”  Sheree Lacey of BT also provided some management tips for adjusting to corporate changes. She recommends inviting everyone who will be using a new software to participate in the choosing process and to empower them to become an advocate of change.

  
 
   

Former Mayor of New York City, Rudy Giuliani, delivered his inspirational keynote about how he used critical leadership skills to reduce crime, to increase employment, to decrease enrollment in welfare and to help New York City recover from the 9/11 tragedy.  Giuliani outlined the key characteristics of an effective leader: a clear goal, optimism and the ability to turn fear into positive energy for working towards your goal.

 
 

And how can we forget the absolutely amazing Train concert at the House of Blues? From their Led Zeppelin cover to “Drops of Jupiter,” Train certainly brought an amazing energy (and some lovely Trainettes on stage) during their performance.

 

I hope everyone had an amazing third day aboard the Revolution Train.  I know I did!

What is RPM?

This week Progress Software end users and partners worldwide gathered in Boston to get some actionable insights that will help them lower costs, raise efficiency, improve customer experiences, and drive revenue. Our attendees have the ability to chose from over 100 sessions designed specifically for business and IT professionals. One of our breakouts is dedicated to Responsive Process Management (RPM) which is a topic we’ve been talking about a lot over the past year. The introduction of RPM has stimulated discussions around our hallways and within the industry on what RPM exactly is…

• Is RPM the Next-generation BPM?
• Is RPM a totally new and different concept?

WHAT DO YOU THINK?

Below are two articles written by Daniel Schlosky. Dan is a technology writer with more than two decades of experience writing for companies like Sun Microsystems, Qualcomm, Broadcom, and Western Digital. He’s also written for publications such as Datamation, Silicon Strategies, and in-house publications for Hewlett-Packard and Texas Instruments.

Take a minute to look at both perspectives and TELL US WHAT YOU THINK!

To share your thoughts, click the Comments link below.

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BPM Is Still Evolving

In the early 1990s, the first Business Process Management (BPM) systems could track processes with only limited scaling and relatively few users. Adequate for tracking accounting or claims processes, they were not yet up to handling an entire company’s purchasing system that services tens of thousands of people. Since then, BPM has evolved into much more powerful and mature systems. They all now include process engines, process modeling, asset repositories, etc. Current large, robust enterprise BPM systems have great complexity and functionality, while web-based departmental BPM systems are usually simpler but still highly proficient.

Today’s BPM systems are extremely powerful and capable. They focus mainly on cutting costs by making companies more efficient through iterative, continuously improving processes. While BPM systems have come quite far, they are still advancing. Several new trends are making them even more powerful and useful.  

One new trend that goes beyond cost cutting is finding new revenue sources. For example, Progress BPM enabled an airline to expand its revenue stream by building an application to connect to alliance partner airlines. The customer, after paying a small insurance fee, is assured that if a flight cancellation occurs, the airline will automatically rebook him/her on the next alliance partner’s flight. It would also automatically change hotel reservations, cancel and rebook rental cars, etc. Happy customers are now saved from the hassle of rescheduling everything themselves – and the airline adds to its bottom line.

A second important trend is including complex event processing in BPM systems. With this capability, managers can monitor streams of activities such as stock market transactions, airline scheduling, and communications ordering systems. One basically searches for patterns and anomalies within those patterns. Although some other BPM systems may also deal with events, Progress BPM, when combined with the company’s Apama business event processing (BEP) platform, sets it apart in both power and performance.

A third new trend is the mobility enablement of BPM systems. These systems can now interconnect with intelligent handheld devices to speed up handling tasks with greater user convenience. For a BPMS process tracking purchase requests and approvals, managers can now actually respond to them on their iPods or blackberries without having to fully log onto financial applications on their laptops. This new mobile capability both simplifies the approval process and saves time.

Yet another significant new trend is enabling greater collaboration, especially in process modeling. Coupled with the new mobility, this is an even stronger improvement. The objective is to have managers in different locations review and provide input for the process model and simulation. Having this collaborative capability in the process planning stages is a major benefit.

These four innovations of the latest BPM systems – finding new revenue sources, events processing, enabling mobility and facilitating collaboration – are the leading new trends in the ongoing evolution of BPM. 

 

The Progress® RPM Suite – Is It Really About BPM?

What exactly is Responsive Process Management (RPM)? Is it a natural extension of BPM, or a totally new and different concept? Analysts and customers generally agree that RPM is an evolution of high-end BPM Gartner talks about Intelligent Business Operations as a development from BPM for responsive operations. Forrester refers to Business Transformation and IDC to Decision Management as expansions of BPM. Others, mainly business rather than technology professionals, see RPM as a completely new domain, one with greater ROI and faster time to value.

A recent Vanson Bourne independent research study found that most businesses are unable to respond to market or customer changes quickly enough to be competitive. RPM triumphs over this challenge with a very high level of operational responsiveness – the ability to sense and respond to changing conditions and customer interactions as they occur. If not totally new, RPM raises its responses to a whole new level of power and possibility. Savvion BPM is an integral part of Progress’ RPM Suite, but so are the company’s Apama business event processing (BEP) platform and Actional business transaction management (BTM) solution. To cap these three systems, the Suite adds its new groundbreaking Progress Control Tower, a first-of-its kind interactive business control panel that ties the three systems together for unprecedented responsiveness capabilities.

The Control Tower is the central RPM control point for

• Modeling and simulating processes
• Automatic documenting of processes
• Drilling down and analyzing information
• Cross-collaborating with team members
• Taking corrective steps as needed
• Continuously improving processes
• Reducing risk

So with all this said, which is it – a natural evolution of BPM or a totally new concept? Convincing arguments can be made for each view. If it’s an extension of BPM, it goes much further by adding real-time, end-to-end visibility into events and applications; enabling immediate response to situations when they arise; allowing users to capitalize on opportunities; and empowering business users with greater control for continuous business improvement.

What do you think? To share your thoughts, click the Comments link below.

 

The Role of Technology in Making Business Decisions

The following is a guest blog by Chris Webber, Senior Editor of the Economist Intelligence Unit.  He conducted a research study on the role of technology in making business decisions and presented his findings during a session at Progress Revolution Boston 2011.

By: Chris Webber, Senior Editor of the Economist Intelligence Unit

History shows that organisations struggle to cope with change. According to Dutch thinker Arie de Geus, that's the main reason why the average life span of a Fortune 500 company is less than 50 years. De Geus's classic study of corporate change is now nearly 15 years old, and it would be startling indeed if corporate life expectancy had increased at all in that time.

 

After all, the pace of change businesses are encountering appears to have picked up significantly in the years since de Geus's research was published. New technologies, more competition, the growth of emerging economies and an explosion in the amount of information being generated are all contributing to an increasingly complex economic system. In a new survey, which has been sponsored by Progress Software, the Economist Intelligence Unit has been analysing the impact of this increase in complexity on corporate decision making.

Unsurprisingly, three quarters of the 490 businesses surveyed think that the pace of change in their operating environment has picked up over the past five years. Added to this, nearly 80% think it's important to respond quickly to the changes that are taking place around them. Again, that's no big surprise given that failure to respond quickly to change implies missing out on growth opportunities or undermining existing sources of competitiveness.

What does seem counter intuitive, however, is that only about a fifth (22%) of those surveyed think their organisation's managed to increase the speed at which it makes decisions over the past five years. In fact, many more say the exact opposite is true, with nearly half (48%) saying the amount of time taken to make key decisions has increased.  

Of course, this raises the intriguing question of why businesses are taking longer to make decisions. Reflecting on that puzzle over the past month, one of the key points I've kept returning to is that more information and analysis doesn't necessarily mean less uncertainty for businesses. On the contrary, increasing complexity and interdependence in our economic system could easily mean that businesses are facing more uncertainty than ever before, and that might well explain why executives are taking longer to make decisions than they would like.

This is an important point. With all the data and analytical tools at our disposal in a modern economy there's a temptation to think that we're capable of fully understanding the complexities of the present and that we have a clearer picture of what the future holds.

To some extent those two points might be true. For instance, there are plenty of examples of administrative functions that have been demystified and systematised over the past couple of decades with impressive results for performance.

Judging by our survey results, however, the majority of executives are still plagued by uncertainty and are struggling to make decisions as quickly as they would like. Technology has clearly come a long way and is improving rapidly, but levels of complexity and uncertainty seem to be increasing even more quickly. Technology providers will need to up their game if they really want to help their customers through this set of challenges

Progress Revolution Day 2: Redcoats and a Revolution

Day 2 of Progress Revolution opened with a bang as Rick Reidy, John Bates and John Goodson took the stage with product announcements and inspiring keynotes on the importance of responsiveness.  The CEO, Rick Reidy, began by announcing the RPM 2.2 release scheduled for later this month, which will feature the Progress Control Tower, an interactive cockpit.   

CTO John Bates, in his memorable red coat (apparently he didn’t get the memo about Lobsterbacks in Boston), emphasized the importance of being responsive in the new world of higher expectations, unforeseen disruptions (earthquakes, rogue traders) and smarter competitors.  He presented the customer success story of Turkcell, a mobile company which used Apama to successfully offer highly targeted, location-based mobile deals for its customers.

For partners building software on top of the Progress platform, Bates showcased Arcade, a platform that can be used to create and manage Cloud-based SaaS solutions. Arcade empowers partners to become more competitive through creating easily consumable, Cloud-based apps faster and cheaper for customers.

In addition, John Goodson, SVP of Product, announced the launch of OpenEdge 11 for the near future, which will be the FIRST process-enabled BPM Cloud development platform with multi-tenancy

 

Finally, Geoffrey Colvin, Senior Editor-at-Large of Fortune Magazine and the author of Talent is Overrated, delivered an enlightening keynote on how high performance is not just for the Einsteins and Jerry Rices of the world.  Ordinary people can achieve high performance and success during times of stress simply with Deliberate Practice.

I look forward to the stimulating customer panel moderated by John Bates, the keynote by former Mayor of New York City, Rudy Giuliani, and of course, the rockin’ Train concert.  Let's continue on with the Revolution, but leave your red coat at home!

Defining Customer Experience Management – A Conversation with Susan McNeice, Yankee Group

Even if you have the latest and greatest communications technology at your disposal, if the user experience is poor, all value is lost. It is the provider’s job to ensure that user expectations are met and that network disturbances don’t negatively affect the end user’s experience, which could result in costly churn and lost revenue. Susan McNeice, Vice President, Yankee Group, will be leading a breakout session at the Progress Revolution 2011 conference (going on now) titled "Emerging Trends and Improving Customer Experience Management in Communications and Media." We asked Susan to expound on customer experience management – what is is, what it entails and how companies can effectively achieve it in a consistent, transparent and dynamic way. Here's what she had to say:
 
PRGS: How do you define customer experience management?
 
SM: Customer Experience Management is a cross-functional discipline that aims to deliver a consistent, transparent and dynamic relationship between CSP and customer.  The goal is to achieve competitive differentiation by viewing the world through the eyes of one¹s customers and modifying interactions of the experience accordingly.
 
PRGS: What does it mean to be 'consistent, transparent and dynamic'?
 
SM : Consistent  - When service providers promise customers certain coverage, quality, pricing or availability, customers expect consistent behavior from the network, customer care, billing, provisioning and all other touch points.
 
Dynamic - Service provider actions that affect the connected experience must be rapid, personalized, immersive and competitive. Connected users of all services look for real-time or at least near-real-time delivery.
 
Transparent - The relationship should be evident and in plain sight at all times, but ³fine print² restrictions and caveats are almost always present in customers¹ experiences with their service providers.  In fact, customers are actually willing to pay 10 percent more per month to avoid billing surprises.

The Revolution Has Begun: Progress Revolution takes Boston!

 What a way to kick off day one of Progress Revolution Boston 2011!  With over 1,000 attendees from all over the world, today was simply the first to an amazing four days of inspirational keynotes, educational sessions, innovative showcase demos and engaging networking opportunities.  Of course, we cannot forget that Grammy-winning Train will be performing on Wednesday!

 

The highlight of today was certainly the Intro to Business Process Management (BPM) workshop by Sandy Kemsley, an analyst with over 15 years of experience with BPM.  Kemsley provided product and brand agnostic coverage on BPM, giving background on its history, explaining BPM Notation, and highlighting the latest trend of integrating BPM with Social Software.  Here are some of the audience’s tweets about Kemsley’s workshop:

  

 

 

Another great success for day one was the evening reception.  Our valuable sponsors, partners, customers and employees gathered for delicious food and drinks, mingled with industry peers and watched product demos from over 30 booths.  Our Social Media Booth, #34, also saw quite some buzz as people came to view and contribute to the live stream of the #ProgressRev hashtag and to earn Twitter stamps for their Revolution Passports.

 
  

Let’s keep up the awesome energy as we continue on with our Revolution, the Progress Revolution!

Introducing SupportLink - Our New Customer Support Portal

Progress Customer Support is now Progress SupportLink!  And it’s not just about a new name – it’s about several new features that make it easier for you to manage support cases and engage resources.  It’s about getting even more responsive award-winning support – from self-service searches to telephone support, giving you the right solutions to your issues quickly and effectively.

From easier management of cases, to stream-lined communications, to faster answers, you are going to like Progress SupportLink!  Check out an overview, complete with informational video and FAQ online!

You may have already pre-registered and received your login credentials – if so, get started here!  Or if you need to create your account, it only takes a couple of minutes to register.

 

SMB Business Outlook: “Cloudy”

Welcome back! Now that summer is over (sigh), it’s time to once again focus on work. I am sure you are busy reviewing your end-of-year strategies and tactics. Some of you might even be peering into 2012 and wondering what you can do to make an impact—maybe grow revenue through new customer acquisitions, make your business more efficient, improve customer relationships, etc. Hopefully, the Cloud is on your short list – and if it’s not, it SHOULD be. And here’s why…

We recently surveyed our Application Partners and ISVs and discovered the following:

• 90% are investigating Cloud computing
• 88% have given “a lot” or “some” thought on hosting in the Cloud
• 60% will begin work on testing the Cloud
• 50% will make some form of Cloud purchase in 2011

If you aren’t among this group, then you are at risk of falling behind and losing business to the competition. The Cloud is everywhere – even non-technical folks will be using the Cloud in some way, shape, or form in the very near future. Not sure about that prediction? Have you seen the recent commercials and ads from Microsoft® and Apple®? They make “going to the Cloud” seem easy and, dare I say, fun? I can imagine you yelling at the screen now, “Sure, storage in the Cloud is easy, but configuring and deploying business applications in the Cloud is HARD!” This is where Progress® Arcade™ comes into play, and you can reference my Welcome to the Cloud blog post for more information on this topic.

For those of you that are still hesitant about the Cloud, let me give you some additional food for thought. I was recently interviewed by InformationWeek for the article, Cloud Contracts: 5 Questions SMBs Should Ask. The article talks about five key topics you should discuss with your potential Cloud vendor(s). While there are obviously more things to consider, this article should help you address many of your greatest concerns prior to “signing on the dotted line.”

Thanks and, as always, please let me know what you think.

PS: I hope to see you at Progress Revolution, September 19-22, 2011 in Boston.

End to end visibility - coming to a supply chain near you

I have been fortunate to particpate in the 2011 Gartner Supply Chain Executive Conference in London, an assembly of leading supply chain practictioners where we spend 3 days listening to latest thinking for Gartner/AMR Research analysts (I will always think of many the AMR analysts in that light!). The underlying theme for supply chains is that we are moving to a new generation of innovation, a manner for enterprises to build the systems and capabilities to elevate their extended supply chains.

What is one of the building blocks at the heart of this transformation? End to end supply chain visbility of course! Gartner highlights a theme which revolves around the VUCA concept -

• Volatility
• Uncertainty
• Complexity
• Ambiguity

Supply chains need to integrate end to end visibility, supply chain sensing and responsiveness to be able to survive in a world where VUCA lurks at every corner. This ability to successfully weave together these abilities through your technology is paramount to your supply chain achieving a high level. One aspect that we must also consider is that no matter how good the visibility and functions technology brings to the extended supply chain, at some point there must be a human intervention when it comes to make decisions. Companies cannot ignore the need to have the appropriate supply chain leadership within their organizations who can leverage these new tools to their full potential.

Which is another element that Gartner hightlighted - supply chain talent management.

Vendors can provide enterprises with some world class capabilities, but enterprises need to put the right level of talent at the controls.

Want to discuss VUCA, visibility, control towers and other supply chain issues of today? Please send me your comments and if you are at the Gartner conference come by the Progress booth! Or please come to Progress Revolution in Boston next week and we can discuss over a bowl of clam chowder.

Is Revolution the Path to Transparency?

Revolutions are proliferating.  When you watch a revolution happening elsewhere, political or otherwise, it’s a good time to contemplate the revolution in your own history, or in your future.  There are few among us that can’t point to one or the other.  One of the common drivers is the fear that something is happening where we can’t see it happen, and we want transparency – of process, of government – of whatever seems to be wrong.

The capital markets globally are experiencing a similar revolution now with regulatory change, and the current climate threatens to create a revolt as well.  Market participants may push back on reforms to the point of creating a new state of stress.  Either way, the future presents very real threats to companies that aren’t prepared.  We’re observing a vast expansion of global rulemaking, and a coming deluge of data - especially in the derivatives markets. It’s very expensive and distracting to fix problems after the fact, so we need to act now.  “Hope is not a strategy” – as is often said to have been uttered by famed (American) football coach Vince Lombardi.

In an open letter to Barack Obama published on January 23, 2009, Benjamin Ola Akande advised, "Yet, the fact remains that hope will not reduce housing foreclosures. Hope does not stop a recession. Hope cannot create jobs. Hope will not prevent catastrophic failures of banks. Hope is not a strategy."

Now we have the Dodd-Frank Act in the U.S., MiFID II and EMIR in Europe, all preceded by the de Larosiere Report (EC, 2009), Turner Report (FSA, 2009), Volcker Report (G30, 2009), G20 – Feb 2009 Declarations, Financial Stability Forum Report (FSF, 2009), INF Report (IMF, 2009), Walker Review (UK, 2009), Basel / IOSCO Reviews… the list goes on.  And the rest of the world is watching, waiting, for another revolution.  The intended scope of the most recent reforms seems to almost be panacea, and transparency is the first step.

The next Revolution is happening in Boston, fittingly.  Progress Revolution 2011, from September 19^ththrough the 22^nd, offers the chance to learn from industry innovators on how they have successfully tackled these challenges within the capital markets.  Customers including PLUS Markets and Morgan Stanley will be there to share success stories.  And Kevin McPartland, Principal at the TABB Group, will be there too.  I’ve included a sneak peek into Kevin’s “Path to Transparency” below.

According to the New York Times, at the Republican Convention in 2008, Rudy Giuliani once said while contemplating Barack Obama’s candidacy, “… ‘change’ is not a destination ... just as ‘hope’ is not a strategy.”  Rudy will be speaking at our Revolution too.  Will you be there?  It will be a lively conference – I hope that you can join us!

-Dan

The Path to Transparency

By Kevin McPartland, Principal, TABB Group

Managing the vast quantities of data born into existence by the Dodd Frank Act and related regulation will present a challenge in the post-DFA environment; but collecting and producing the required data is just the tip of the iceberg. The ability to analyze and act on that data is what will separate the survivors from the winners. This is already true in many other parts of the global financial markets, but the complexities inherent in swaps trading coupled with the speed at which these changes will take place creates unique challenges. Spread this across all five major asset classes and three major geographies, and the complexities become more pronounced.

Margin calculations are proving to be one of the biggest concerns for those revamping their OTC derivatives infrastructure. In a non-cleared world, dealers determine collateral requirements for each client and collect variation margin on a periodic schedule—in some cases once a month, and in other cases once a year. When those swaps are moved to a cleared environment, margin calculations will need to occur at least daily. The result is an upgrade of the current batch process with dozens of inputs to a near-real time process, with hundreds of inputs. Whereas before major dealers could perform margin analysis, client reporting and risk management in a single system, those systems now need to operate independently within an infrastructure that provides the necessary capacity and speed.

The trading desk will require a similar seismic shift, as flow businesses will provide liquidity across multiple trading venues to an expanding client base. Most major dealers are at some stage of developing liquidity aggregation technology intended to provide a single view of liquidity across multiple swap execution venues. Creating this type of virtual order book requires receiving multiple real-time data feeds and aggregating the bids and offers in real time.

Furthermore, rather than comparing model-derived prices to the last trade price to produce quotes, inputs from SEFs, CCPs, SDRs, internal models, third-party models and market data providers will be required inputs to real-time trading algorithms once reserved for exchange-traded derivatives.

Providing clients with execution services presents other challenges. Executing on multiple platforms also means tracking and applying commission rates per client per venue in real time. Trade allocations also complicate the execution process.  In the bilateral world a big asset manager can do a $100 million interest rate swap and spread that exposure across multiple funds as it sees fit. Under the DFA, the executing broker must know which funds are getting how much exposure. Account allocation in and of itself is not new, but cost averaging multiple swap trades and allocating the right exposure at the right price to the proper account presents complex challenges, especially in a near-real time environment.

Risk management, compliance and back-testing data will also require huge increases in processing power, often at lower latencies. Risk models and stress tests, for example, are much more robust than they were before the financial crisis, requiring a considerably higher amount of historical data.

Compliance departments now must store the requisite seven years of data so they can reconstruct any trade at any moment in the past. This is complicated enough in listed markets, when every market data tick must be stored, but for fixed-income securities and other swaps, storing the needed curves means that billions of records must not only be filed away but retrievable on demand. Similar concerns exist for quants back-testing their latest trading strategies: It is not only the new data being generated that must be dealt with. Existing data, too, is about to see a huge uptick in requirements.

In the end these changes should achieve some of the goals set forth by Congress as they enacted Dodd Frank – increased transparency and reduced systemic risk.  The road there will be bumpy and expensive, but the opportunities created by both the journey and the destination will outweigh any short term pain.

This perspective was taken from the recent TABB Group study Technology and Financial Reform: Data, Derivatives and Decision Making.

 

Supply chain disruptions...but not the usual suspect

Earthquakes, hurricanes, power outages, SARS outbreak are all examples of external events that can create disruptions to your extended supply chain. What about other events? How about a sporting event? For those of you that are not fans of the oval ball (the rugby ball that is) the Rugby World Cup has kicked off this past week. So what does this mean, why should your extended supply chain care? Simple - late nights watching the matches, too much lager, extended water cooler chats, missing work due to "illness"...to name a few unintended results of the sporting festivities. Think this is a non factor to the work place? Think again!

For those readers in the United States we are all aware that every March comes the NCAA men's collegiate basketball tournament and with it office pools, seemingly non stop games and suspected drop in productivity. Similar impacts occur when it comes to other large scale global sporting events - such as the Olympics or Football World Cups (soccer for North American readers). And if you are not convinced such sporting events can impact your extended supply chain - how many events can cause warring sides to pause during such an event - click here to read about how the World Cup stopped a civil war? With the Rugby World Cup upon us it is a good time to reflect on how such an event can impact your extended supply chain.

• Supply Chain demand impact - during the 1970 Football World Cup, the games were going to be broadcast in color for the first time, creating a lift in color television sales. Same occured during the 2006 World Cup when the matches were in high-definition for the first time. Sales of HDTVs went up (the same cycle occurs in North America prior to the Super Bowl). How will your supply chain react if demand spikes because fans want more HDTVs or if the number of rugby players looking to purchase your boots triples over night?
• Strain on productivity - when you have a large scale sports event that will go on for a few weeks you need to anticipate potential drops in your work effectiveness. As mentioned above, workers from all aspect of your supply chain are fans, how productive will they be if the nation they support plays deep into the tournament or if they reside in the host nation? I recall a story of a CEO of telecomm company being in Mexico in 1986 being told that if business did not get done before the start of the World Cup that he might as well wait until the tournament's completion. Otherwise the entire nation was going to be distracted by the football. If your extended supply chain relies upon nations that are active participants you need to be aware of the potential impact on your work force during the tournament.
• Host nation pop - the host nation will get an economic pop, from infrastracture improvements to influx of tourists and corporations looking for advertising. If your supply chain offers relevant services then you need to be prepared for unexpected demand for your services, on the flip side your business might be negatively impacted as resources and efforts usually pointed in your direction are realigned to support the event.

Large national sporting events ellicity national pride from fans, but they also have supply chain impact. How will your extended supply chain react? Ignore these disruptions at your own peril, while the impact might not be as clear as when a port falls victim to a strike or volcanic ash shuts down airspace, such sporting events can and will impact your extended supply chain. Without visibility into your extended supply chain, the impacts, good or bad, will be magnified through out your business.

So who will win this version of the Rugby World Cup? While I wish I could say my beloved France will somehow pull it together, I fear their run will end in the 1/4 finals againt nemisis England. Semi-finals will look like the Tri Nations: England v Australia and South Africa v New Zealand. Look for the Kiwis to win the title on their home turf.

Want to talk more about how events, such as the sporting events but also more "traditional" supply chain events can create blind spots in your extended supply chain and how to better deal with them? Join us at Progress Revolution in a week, maybe we can also catch a rugby match as well!

 

Introducing the Progress Revolution Boston 2011 Smart App – Because Real-Time Connection to the Right People and Ideas Delivers Genuine Value

In a couple of weeks we’re hosting Progress Revolution 2011 in Boston. With all of the innovation in the overall business environment as well as important shifts and trends in specific industry sectors, it’s very exciting to bring thought leaders together for a candid exchange of ideas.

While idea exchange in the abstract is inspiring and motivating, what’s most important is interfacing with those individuals with ideas relevant to your business.  This is the value that you bring home to your organization. 

 At Progress, we’re all about real-time connectivity – we know that this translates into measureable success. We encourage our clients to focus on both bottom-line performance and return on investment. We are mindful and appreciative of the time and resources that our attendees are spending to attend 
the conference, and are committed to ensuring that we maximize the return on that investment.

We are pleased to announce the launch of the Progress Revolution Boston 2011 Smart App – this interactive application works with your iPhone, iPad, Blackberry or Android and provides you with up-to-the-minute information on the conference. 

Our attendees will be able to search, connect and communicate with other participants with aligned business interests to schedule meetings, share highly relevant ideas and stay in touch after the  conference. The application will also feature Progress Q&A covering product information, conference questions and other related community topics. 

During the conference the application will provide real-time information on conference news and events and instant access to a video channel featuring interviews and commentary.   Attendees can also connect and collaborate on exploring the restaurants, activities and sites in historic Boston.

We’ve made it simple and easy to access and install.  All you have to do is visit the Apple App Store, Android Market or Blackberry App World – the application works across the spectrum of smart phone platforms.

To register, open the application on your device and type in your email address and the password (provided to all attendees via email) to set up your account. It’s important to use the default password so that the application recognizes you as a conference attendee.  Then, go ahead and search for “Progress Revolution” and install the Progress Revolution 2011 application.

Within the application you will be able to customize your profile and preferences and access a list of other attendees.  The application will point you to the attendees that most closely align with your profile and interests, and you can learn more about their background and contact them directly to connect and communicate.  

We’re really pleased to bring this innovation to the community attending Progress Revolution 2011. It’s our goal to connect the right people, spur the exchange of the best, most relevant ideas and deliver the highest possible value and return on investment to our attendees and their organizations.   We’re looking forward to spending an inspiring, informative and valuable few days with the Progress community.

Download the Progress Revolution Mobile App here:

iPhone

Android

Blackberry

More extended supply chain variables means greater need for visibility

Companies do not compete, supply chains compete…have you heard that one before? If you have, you probably are well aware of all the factors that go into running your business rely upon a host of partners and service providers that do not have your logo on their business cards. Globalization and competiveness has created a business world where no company can truly “own” all that goes into make their business…their business. We can only succeed in our business if our partner, our supply chain, is successful. In the pursuit of efficiencies, economies of scale and maximizing competitive advantages we have also created the unintended consequences of dilution of control. Even when companies controlled their supply chain they did not enjoy the visibility or ability to react to consumer demands to the level they would like. Remember Henry Ford? He was happy to sell you a Model T in any color you wanted, as long as it was black. Already Ford knew that his assembly line, and by extension his supply chain, could not cope well with diversity, choice and any color other than black. 

Fast-forward to today’s globalized economy. Companies whether they are B2B or B2C, must offer choices to their end customer. Whether those choices are in terms of the color, size, taste, speed or texture of the good or whether it relates to the service level a customer can expect after the sale or the rapidity at which the service is delivered. These all factor into the global extended supply chain and all call for a level of orchestration and visibility not easily attained but constantly demanded by customers. The reality is our extended supply chains and businesses need greater visibility and enhanced real time decision-making functions in order to compete and ensure they meet the constantly evolving demands of the consumer.

At Progress Software we are addressing these needs and this next step in the evolution of supply chain solutions. Come to Revolution to learn from our team and clients how we are able to tackle this issue and join us to take the next steps in the next wave of supply chain solution innovation.

Progress-- You Say You Want a Revolution

By: Greg O'Connor

Greg O'Connor is the CEO of AppZero and a guest contributor for the the Business Making Progress blog. Pioneering the Virtual Application Appliance approach to simplifying application-lifecycle management, Greg O'Connor is responsible for translating Appzero's vision into strategic business objectives and financial results.

Here’s a revolution: AppZero protects your software from your customers.

As a proud Progress alumni approaching Revolution, I am struck by the irony of how very much I could have used the technology I now bring to my fellow software executives, who are struggling to balance revolution and cost. 

It all began in a little log cabin … Progress and Sonic 2000

In 2000, I had the opportunity to gather some of the best and brightest people as I co-founded Sonic Software with Bill Cullen, Sonic CTO (and product brain)  At the time, we saw a market-making opportunity to take the AppServer world standards (formal/XML or market driven/Java) and apply them to the EAI market.  

Thanks to the afore-mentioned bright folks, help from Roy Schulte (a Gartner fellow at the time), a bit of luck, and an excellent Messaging product, we created and evangelized the ESB market category.  The first ESB to market -- Sonic XQ (Xml Queue) -- was shipped February 2002.  10 eventful years later, I’m here to share what Bill Cullen, AppZero CTO, and I are up to – and how our Sonic experience shaped it.

If you sell software, you’ll appreciate this observation

Growing Sonic Software, we faced two universal hurdles that significantly impacted our business – and that of pretty much everyone who sells software:

1. Winning or losing – labor-intensive demos, proof of concepts (POC), evaluations, and trials had a huge impact on our growth rate
2. Installs that did not go perfectly, resulted in fire drills, lost business,  and a sharp dip in customer confidence

(These facts of software life are some of the acute pain points we solve here at AppZero.)

At Sonic, we were often faced with a 5 day evaluation for a prospect:  1 day to setup our software on their environment, 3 days to do the work they requested, and 1 day show off the results.  (IBM, Tibco, BEA and Webmethods   had more or less the same timeframe but seemed to send a heck of a lot more people to the evaluation.)

When the 1^st day did not go as planned, we always lost.  Always.  Every single time. No exception.

A cautionary tale:  If you sell software, you are guilty until you prove yourself innocent

Oh, and here’s how I learned that an imperfect install can still bite you long after you have successfully fought to win a customer (in this case a market icon).  A full year after having won the business and implemented our product at the New York Mercantile Exchange, I received a call from the CIO.  He had some new concerns, “Sonic messaging system appears to slow down under load”. 

Arrgggh.  How could this be possible?  Sonic was ahead of its time with elastic scaling, continuous availability, and best in class through put.  This could not be correct.  As it turned out, it wasn’t. 

But determining and fixing the “root cause”  took 6 labor-intensive weeks filled with tons of anxious phone calls, numerous pointing fingers (with chewed fingernails), and a couple of flights to NYC by our top troubleshooter .  Life got very unpleasant before it returned to good.

The culprit? A bug in the Java Virtual Machine (JVM) and Java Runtime Environment  (JRE) that would not do garbage collect (free memory) under load.  Now, long before that fateful phone call, we at Sonic knew all about this issue.  We had documented it, changed our install and packaging to make an easy fix. 

(Cue scary music) But then the customer got involved.  

Someone, somewhere along their line had installed their company’s “certified” version of the JVM/JRE thereby putting our product and reputation at risk.

“It wasn’t my fault” just doesn’t matter.  It took a long time, involving many smart people to find the 2 files that needed to be changed so that all the oil futures in the world could once again flow over the Sonic messaging system.

Morale of the story: Once a customer has your software, things happen.

If I had a time machine, I would bring the AppZero product to my(then)self 

AppZero not only solves the PoC puzzle for software vendors, but protects their Windows and Linux server applications from customers.  We make it possible for applications to be pre-installed, pre-configured and then provisioned onto a physical or virtual OS -- in minutes, perhaps over lunch.  

This capability effectively changes the math around POCs in a big way: we reduce the install, setup and configuration time to zero.  If I had been able to use AppZero at Sonic, I would have freed up a whole day to actually do the customer requests on every single PoC.   What would a 33% increase in productive time have meant?  I’m going to guess a higher win rate against the competition, faster company growth, bigger promotions, and more time spent with the wife and kids.  

And if I had had AppZero at Sonic, our very cool software would have been safely isolated from the customer’s operating environment instead of deeply enmeshed in it.  Innocent from the start.  Hey, how’s this for a new tag line? “AppZero -- protect your software from your customers.”  (www.appzero.com)

For more fun stories and a look at another market-making technology, stop by our booth at Revolution.

Greg O’Connor, AppZero CEO
grego@appzero.com

Experience the User Interface Revolution

 By: Mike Fechner   

Mike Fechner of Consultingwerk, a software architecture and development company, is a guest co nt ributor on the Business Making Progress blog. He started using Progress and OpenEdge in Version 5 almost 20 years ago and ever since has supported Progress Application Partners and end customers in adopting the features of the latest OpenEdge  and Progress releases to enhance the capabilities of existing  applications.

 Consultingwerk is proud sponsor of the Progress Revolution Conference and exhibitor at the solution expo. Visit us at our booth and see how we can support you with your user interface revolution!

The user interface is the most visual point and often the selling point of every application. The user interface needs to convince prospects during the demonstration of the application and needs to support existing and demanding users to get their job done in a productive and pleasing manner. Last but not least the user interface needs to stand the comparison with standard applications such as well-known office suites.

Consultingwerk is specialized in leveraging Microsoft .NET technology to help our customers build modern user interfaces for existing applications as well as new applications and new modules of existing applications. Our products and services are designed around the combination of Progress OpenEdge and Microsoft .NET technology, both based on the OpenEdge GUI for .NET or native .NET development.

Instant migration to the OpenEdge GUI for .NET

The WinKit (Window Integration Toolkit) is Consultingwerk’s proven tool to simplify the adoption of the OpenEdge GUI for .NET in existing OpenEdge GUI applications. The migrated application receives a modernized, state of the art user interface that allows easier sale and increases the end user’s acceptance of existing OpenEdge GUI applications. Think of it as adding modern controls like the Ribbon, Tab Folders, Dockable Panes and Grids into the existing application without requiring any rewrite or architectural change. This results in dramatically reduced costs and almost no risk in the process of modernizing your application.

Rapid application development for the OpenEdge GUI for .NET, OpenEdge Reference Architecture and the Visual Designer

The SmartComponent Library ensures your successful transition towards developing with the new user interface technology and the recommended application architecture principles in the shortest possible time using enhanced development tools and specialized runtime components. Our  tools are designed to get you instantly up to speed with a modern user interface technology and application architecture without taking any compromise in flexibility or capabilities of the new application or application modules.

The WinKit and the SmartComponent Library can be used together or independently from each other. The shared foundation code base ensures the successful combination right from the start or one after the other – depending on our customer’s needs or time scale.

User interfaces for Mobile Devices such as iPhone, iPad and Android

Our new SmartComponent.Mobile framework can be used to build native user interfaces (Apps) for the most popular platforms for mobile devices. It is based on .NET technology to make the best usage of our existing framework components and both our and our customers’ existing experience. The SmartComponent.Mobile framework allows you to access the OpenEdge Database and Application Server and reuse existing business logic that may also be used in the SmartComponent Library on the OpenEdge GUI client. For our customers already using the SmartComponent Library this allows that they only have to develop the new user interface but can keep the existing business logic. For new customers this guarantees that any new effort spend in a new application architecture  can be leveraged from a large number of different user interfaces.

Our tool offerings are completed using top of the edge consulting services. Our expert consultants have experience from a large number of projects supporting OpenEdge partners and end customers during all aspects of the modernization of OpenEdge based applications or the conception of new developments. Do not miss the chance and discuss your application needs with one of our experienced senior architects on our booth.Get a personal demonstration of our outstanding tools and see how we can support your success.

As you can see we will be demonstrating solutions for any user interface your application might need to help you with your personal user interface revolution!

Looking forward to see you in Boston!