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jonerpdemojam.jpg Jon has been tackling key SAP issues (like SAP certification and HANA) since 1995. Get the latest from his blogs, YouTube channel, and iTunes feed.

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SMEs, Clouds, and the Impact of SAP Business ByDesign - an SCN Podcast Print E-mail

podcastlogo_jonerp.gifPodcast: Listen Now!
Vendor Podcast - An Interview with Sina Moatamed, CIO of BendPak, about how SMEs can use the cloud for business enablement, and why BendPak selected ByDesign.
An SAP SCN Community Podcast
Hosted by Jon Reed of JonERP.com
Podcast Interview Date: March 31, 2011

It's hard to assess the actual impact of "the cloud" unless you've been able to see it first hand. To get a better insight into the impact of the cloud on the small and medium enterprise (SME), Jon Reed interviewed Sina Moatamed, CIO of BendPak. An early SAP Business ByDesign customer, BendPak has had a chance to grapple with the role SaaS for SMEs and to evaluate its business benefits. During the 24 minute podcast, SAP's Siva Darivemula joins the discussion and shares the latest news about ByDesign on SCN.

As a guiding force behind the IT transformation at BendPak, Moatamed shares what he learned about the IT gaps within the company and how to address them. Based on his experience as the CIO of a larger enterprise and now at BendPak, Moatamed explains why moving to the cloud has the potential to shift the IT department from infrastructure management to systems enablement. In simple terms: cloud-based solutions can empower the business user to build their own services and initiate truly business-driven IT projects. Moutamed believes that SMEs actually have an edge on larger enterprises in this regard, and he explains why in this podcast. He also talks about why BendPak chose ByDesign, what he's looking forward to in version 4.6, and how ByDesign gives BendPak a new kind of "business agility." 

Editor's note: this podcast references the new Business ByDesign Community at BPX.SAP.com. Also check out the ByDesign and On Demand blog categories on SCN. During the podcast, Moatamed makes several references to SLAs (Service Level Agreements). For those new to the term, here's a definition.

1:!5 How Sina ended up as a CIO of an SME: Sina already had a large enterprise CIO background and had a clear sense of how enterprises could scale. He came to BendPak in 2007 with great interest in building a service-focused IT model, and implementing an infrastructure primarily based on the cloud.

2:30 What Sina learned by "walking around" when he started at BendPak: there were a lot of disjointed systems, a lack of master date BendPak could rely on for comprehensive analytics - they needed a better sense of how to move the company forward strategically, based on really solid information. That gap existed when Sina joined. What began as a look at the infrastructure quickly became a walkabout discovery of how the company is functioning and how the processes are structured. That "walk around" gave Sina a better sense of how medium to large scale enterprise practices could be utilized at BendPak.

4:00 Jon to Sina: so once you assessed those challenges, how did ByDesign enter the picture? Sina: part of the SME challenge is that the infrastructure is managed through external vendor support, but there isn't continuity there either. The SLAs are always around the technologies - that's' similar in large enterprises as well. With SMEs, it was with external VARS, but it wasn't structured around business processes. For the SME, the real challenge is how do you bring in a suite model that will tie those processes together in a financially responsible way for the long run, so IT isn't a roadblock but a place of enablement for the business itself.

5:52 Jon to Sina: How could ByD help address those issues? Sina: what was fascinating about the ByD platform is that yes, it was a suite, and yes, it could be delivered as an on-demand model. in a traditional model, you're focused on the components of a service, but the business experience is around the service itself. Now you're buying the service at the place the business is consuming it. That's the essence of the shift of cloud technology. now you can be less concerned with the anatomy and more on the service itself. Now my engineer isn't an engineer, it's an attorney.

You can also configure your processes without any programming using ByD's business configuration. So that lends itself to business agility. Too often, when you want to structure something in traditional IT, there is a lot of programming, people looking at the processes, and then people who will actually implement that. In the ByD case, you focus on the process via business configuration, test it out and implement it in your production system. What took you months now takes you weeks, and you're functioning with these best practice processes in place.

8:45 Sina: What we're seeing is the evolution of cloud and infrastructure as a service models. Very often, you construct this thing from the business side, there is no engagement on the technical side. Really it's a function of can you get the business needs addressed. In the business unit, they can affect these changes in ERP, and engage the organization that way, it's no longer necessary to go to IT to work that out. This whole idea of self-service is really the innovation of cloud technology is providing. It's a self-service to derive what you need for the business, and that's a big shift, and that's what we accomplished at BendPak.

10:30 Sina on why SMEs have an advantage moving from infrastructure focus on business enablement focus:  the complexities aren't there, but there's also an openness among SMEs because they know what they need, they don't have the in-house people. They are looking at it and saying, "We have a small IT department ,but we can still execute it." Many large enterprises in the recession moved away from internal IT to external outsourcing.

But they would take part of the anatomy of that service and farm it out, and what you're doing is body shopping. The SLAs are pinned against the technology, not against the user experience. For them, the logical leap to go to cloud - it makes a lot of sense of them. SMEs in a lot of respects are paving the way for this new model of IT management, you're moving away from infrastructure management to business consulting and enablement, and that's the role of the new CIO and the IT in general...and that's going to be enabled through cloud technologies. You'll see it in SMEs, and in the next few years you'll see that in larger enterprise.

13:30 ByD 2.0 to ByD 2.6 - what features is Sina looking forward to? I'm not sure what the name is yet, but this idea of an application store and an open architecture for integration is extremely appealing. The SLA structure of web services exposure - to have an integration done in that manner is really an exciting thing. We already have three major points of integration with our ByD solution but there are many more we'd like to take on. This new architecture that's coming is something I'm really looking forward to, primarily greater automation between applications and services.

14:45 Jon to Sina: You've talked about using ByDesign for business agility, but what does it mean? Sina: Here's an example: we had a strategic change and we wanted to create a whole new distribution location for the company internationally. We discussed it in December, and instead of it being a long drawn out process, we went live with it January 2011 and it was done. So that gives you an idea of how quick you can respond, and the effect for us is we had a need for the marketplace to address, and we had to address that literally in a matter of weeks. So we went into business configuration, affected that change, and moved forward - with a tremendous boost to our company and international sales. How do you enable the business to be very nimble and responsive - we now have a set of tools that can do that. That's what it means to be business agile.

17:15 Siva to Sina: Let's say I'm not as knowledgeable as you are, what should I do? Sina: First of all, if you manage an infrastructure and you're really intrigued by cloud, the real trick is that this not a technical choice, but a business decision. Again, you're securing a service that relates to how the business users enable technology to do what they do. It's not about doing a doing a bunch of tech to create a service. So where you need to begin is with your processes, so you could look a lead-to-cash from a continuity perspective. You could ask: do we have the master data, analytics, and structure and controls to get consistent information about business performance? And if there are gaps, you can see which cloud offering can fill the gaps. You really need to start, it's an outside-in exercise, it's not an IT focused perspective.

19:45 Siva to Sina: So what's the path to cloud from there? Sina: There's different cloud offerings and approaches. With any leadership role, the goal is to reduce constraints in your business and get rid of them. So, you review the process, to say, identify your constraints, and it will start to become very evident. It depends on what service you need - in our case it required a complete look at our ERP platform. From there, we can evaluate vendors, and you set those requirements up front with your business groups. Identity the core requirements and see how you're going to execute, and cloud will present itself when you look at solutions.

21:35: Jon to Siva: What's the latest on ByD on SCN? Siva: There will be a lot with ByD on SCN this year. the ByDesign community is now live in the BPX area, and many resources will be added there. There will be plenty of news coming out at Sapphire as well, between now and Sapphire and after Sapphire as well.

 

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