Levers for Growth: Axway Connections ’09 Predictions Panel

Axway CTO Dave Bennett, Taher Elgamal, Bernard Debauche and Joe Fisher discuss levers for growth and make predictions. 

There’s More to Life Than Saving Money

by Antoine Rizk
VP, B2B Program, Product and Solutions Marketing
Axway

New requirements constantly emerge for additional standards that are not yet supported (e.g., new networks, protocols, formats, etc.). Infrastructures that are too rigid simply break like the tall oak in the wind and need to be replaced.

New requirements constantly emerge for additional standards that are not yet supported (e.g., new networks, protocols, formats, etc.). Infrastructures that are too rigid simply break like the tall oak in the wind and need to be replaced.

Back in December 2008, a leading analyst predicted that, due to the then-burgeoning, now-stabilizing financial crisis, the major business case for many application and infrastructure initiatives was going to align with cost reduction.

And they were right. Nearly every customer I’ve spoken to corroborates the analyst’s prediction. But I submit that there’s more to life than saving money, even in lean times like these. So what, you may wonder, are those things, those compelling drivers for B2B/MFT projects besides getting things done on the cheap?

Five stand out to me.

  • Compliance: You must have the right auditing and logging information to comply with industrial, financial or legal obligations. In a way, you might see this as a continuation of the saving-money school of thought. After all, preventing fines and lawsuits is a money-saving activity, right? But there is a vast difference between spending too much on something and any amount on nothing, which is never an easy circumstance to accept.
  • Business Growth: Business growth often drives architecture refreshes, and rightly so: when the existing solution cannot efficiently handle the demands of the business, when the business outgrows its architecture to the point that no amount of ingenuity or reorganization can accommodate it, it can no longer cope with the demands of its trading partner community.
  • Business Risk and Loss of Data: When your current processes lack the control you need for guaranteed, once-only delivery, the result is a story of misfortune: missed SLAs, multiple payments made, orders lost, etc. And all of this directly impacts the bottom line.
  • Personnel Rollover: Developers of legacy, home-grown FTP solutions, like long-gone inhabitants of ancient civilizations, move on to new opportunities, and in their wake they leave behind little or no documentation on the tools and mission-critical data that their successors need in order to keep operations running smoothly.
  • Expanding Requirements: New requirements constantly emerge for additional standards that are not yet supported (e.g., new networks, protocols, formats, etc.). Infrastructures that are too rigid simply break like the tall oak in the wind and need to be replaced.

In my view, none of the above drivers are compelling enough in their own right to bring about a new infrastructure initiative without thorough proof of accompanying TCO reduction and ROI. This truth cannot be stressed enough.

Fortunately, reducing TCO can be done in many different ways. Consolidation, however, is by far the approach that brings the most value. B2B/MFT consolidation can be achieved by replacing multiple legacy and home-grown solutions with a single solution that is solid enough to maintain and even enhance performance, and covers all the required formats and protocols for the exchanges.

Consolidation can cover a variety of business cases:

  • Replacing on-premise FTP/home-grown file transfer infrastructure with a managed file transfer solution
  • Replacing on-premise product with a managed file transfer solution
  • Replacing several on premise multi-enterprise/B2B gateways with a single B2Bi platform
  • Replacing a VAN with an on-premise B2Bi solution
  • Replacing on-premise B2B gateway(s) with a B2Bi on-demand solution

As well as any combination of the above.

Finally, there is the ever-important ROI. Three ways consolidation brings you ROI include:

  • Reducing your IT costs: This includes personnel, planning, organization, acquisition, implementation, delivery and support, as well as monitoring/evaluation costs.
  • Reducing your business costs: This includes costs due to an error or a delay in message/file delivery, downtime hours, fees and penalties per missed SLA, audits, losing customers and data breach penalties.
  • Increasing your business value: This includes incremental revenues due to getting new products to market faster, being easy to do business with, reliable delivery and non-repudiation, increased customer satisfaction and loyalty, and being able to add new partners to your network.

When you increase business value, you increase your revenues and quickly bring better services to market. Your suppliers and customers can deal with you easily, and that brings about customer fidelity, satisfaction, loyalty and a host of other benefits too numerous to explore here. It’s easy and vitally important to take measures to save money, no doubt about it, but it’s the truly savvy business people who remember the essential nature of nourishing and flourishing business value, and it’s those business people who will, years from now, look for new ways to save money while their long-gone competitors fondly remember the business they were once in.

(Photo by zenera: http://www.flickr.com/photos/zenera/ / CC BY-SA 2.0)

Three Reasons Why Supply Chain Transactions Demand Data Integrity Assurance

by Chuck Preiss
Director, Solutions Enablement
Axway

Marco Polo operated a global supply chain in the 13th century, and he did it successfully, centuries before there was any data, period—let alone data whose integrity needed assuring. So why is assuring data integrity so important now?

Marco Polo operated a global supply chain in the 13th century, and he did it successfully, centuries before there was any data, period—let alone data whose integrity needed assuring. So why is assuring data integrity so important now?

The importance of data integrity in the supply chain is a mystery to some folks. After all, Marco Polo operated a global supply chain in the 13th century, and he did it successfully, centuries before there was any data, period—let alone data whose integrity needed assuring.

So why is assuring data integrity so important now?

There are several reasons.

The first one is cost. There are folks out there who waste a lot of time in the supply chain with invoicing and ordering problems due to data issues. For instance, I’m Company A and I send out an invoice to Company B, and I’m missing ship-to or bill-to information or I have wrong pricing. Company B’s system is going to kick the invoice back and I’m not going to get paid. And I’m not going to know that kickback happened until my accounts receivable people come to me and say, “Hey, this invoice is past due. Why didn’t Company B pay it?” Then my people have to perform some serious research to find out what happened—a real cost issue. Cost, of course, runs just about everything in the supply chain, but sometimes, it actually creates panic (i.e., “I need to have this inventory here at a certain date and time. If I don’t, I’m going to have a stock-out situation that could cost me money or customers.”)

The second reason is relationship management. Manufacturers, retailers, transportation, logistics folks—they’re all trying to have a kind of win-win relationship, to have everything run smoothly. The only way they can do that is to hold supply chain folks accountable. If I’m a retailer, I want my manufacturer to send me his shipments on time and I want that to happen to the five nines level; the only way I can measure that is to track all of his shipments and create trending information. That way, I can rest assured that he’s satisfying his service level agreements with me. (Not that I want to necessarily charge him for late shipments, but the point is this: the more we can both become more efficient—the more my manufacturer can meet my demands and I can hold him to it—the better.)

The third reason is visibility. Companies often don’t even know that they’re having these problems. They send out invoices. They’re hoping they’re getting to the other end, hoping they’re right, hoping their customer will pay them. But the only time that they know that something’s amiss is when their accounts receivable department says, “Hey, we’ve got a problem. So-and-so hasn’t sent us payments on the last hundred invoices.” Once again, the company has to figure out what the problem is. However, if you add the visibility piece to it—say, a technology like business activity monitoring—a company can proactively, before the shipment leaves the enterprise, check the invoice file and ensure the information is accurate. If they’ve found a problem previously, they can set up a rule to catch that problem before it happens again.

That’s the true strength of these technologies. It’s not about dashboards. It’s not about “here’s what my business is doing right at this very moment.” It’s about cleaning up information and allowing the whole process to run better. Marco Polo didn’t have it, but if he was doing business today, he almost certainly wouldn’t allow his supply chain to run without it. Why should you?

(Image in the public domain: http://en.wikipedia.org/wiki/File:Marco_Polo_portrait.jpg)

Why Service Level Agreements Fail and What Steps Will Help Yours Succeed

by Daryl Eicher
VP, Industry Solutions
Axway

Is there ever a reason to believe that unmonitored SLAs are worth the paper they’re written on?

Is there ever a reason to believe that unmonitored SLAs are worth the paper they’re written on?

Why do service level agreements (SLAs) fail? There are three big reasons why SLAs don’t work out the way people expect them to. For starters, too often, SLAs just aren’t detailed enough. They don’t focus on specific expectations for the parties involved. There are too many ways around SLAs like that, because too much is open to interpretation.

The second big reason SLAs don’t work out is lack of clarity around incentives. It’s critical to make sure there are consequences. Unless there are financial consequences for non-performance (i.e., you don’t get paid as much, you don’t get paid at all, etc.), it’s unlikely, just based on human nature, that you’re going to get the level of service you’re looking for. There are two camps here: one’s more pejorative and Draconian, the other is a little looser. But you always get what you measure. And an SLA needs to be considered a binding, contractually valid commitment between two parties about a service that’s being delivered and about what the quality of that service needs to be in order to warrant full payment.

Finally, SLAs that are not effectively monitored tend to have more issues with quality of service than those with automated mechanisms for continuous, fact-based evaluation.

While these fundamentals are pretty basic, it’s surprising how difficult it is to actually get business partners, customers, suppliers and agencies aligned on what is most important to their working relationships. What are the rules of engagement? Since that is often vague or unenforceable, there may not be mechanisms to automatically monitor performance against that service level. If you’re missing either one of these keys —if you don’t have enough detail or a mechanism for monitoring it—you’re not going to get full SLA compliance. Period.

That’s why SLAs fail. So what can you do to avoid these common pitfalls?

First, think about what is important to you as the provider or the buyer in terms of quality of service. You have to negotiate and adequately document performance expectations. Next, you have to make sure there is an automated, fact-based way to monitor compliance. Periodic audits and anecdotal problem escalations are often used to give indications of compliance, but they’re expensive, disruptive and sporadic. Make sure that compliance is financially lucrative for the provider. If they perform as expected, then they get an upside from it, or, conversely, a financial penalty for non-performance.

Second, realize that automatic monitoring depends on a level of confidence in the data about the service. Since many services are delivered in the cloud or from a third party, the data about quality of service is often self-reported by the provider. This is another thing you’ve got to be careful about. You’ve got to be very explicit about the quality of that data. Everything—definitions, calculations, how it’s collected, when it’s reported and what to do when there are problems in the data—needs to be in writing. In fact, the quality of data about the service is an important part of the service. So include data quality as a key metric in the SLA and tie it to financial incentives.

Remember, if you can’t trust the numbers, you don’t know what you’re looking at, and you won’t have effective performance monitoring. Without that data, how will you ever know whether you’re truly getting what you pay for?

What do you think? Is there ever a reason to believe that unmonitored SLAs are worth the paper they’re written on?

(Photo by Andyrob: http://www.flickr.com/photos/aroberts/ / CC BY 2.0)
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