April 26, 2004

We asked Jon Reed, editor of our SAPtips publication (www.SAPtips.com) to interview Andy on where JDEtips has been and where we are going.  Jon is the best possible SAPtips editor we could ask for, and his incisive interview shows that he even understands the JDE market.  The alternative – Andy interviewing himself – was simply not an option.  It would have been too difficult to distinguish the interview from his usual flow of mutterings, excited yips, and other noises emanating from the vicinity of his desk!

Legend:
J - Jon Reed, Editor, SAPtips (www.SAPtips.com)   A - Andy Klee

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J What types of articles and white papers do you publish in the JDEtips Journal?

A We tend to publish articles that cover several different purposes—specific advanced tips and overviews of new functionality.  Clients benefit from these articles because either the concepts aren't well documented or in fact are not even known by most clients and consultants.  Overviews of new functionality are appropriate because there might be a relatively new piece of software that JD Edwards has released recently.

J How do you find your writers?

A We started out mostly with consultants we knew that had a lot of experience in the field and these are people that I've met over my 15 yearsof JD Edwards consulting (10 as a JDE employee).  We have broadened our reach to include new people that have found out about JDEtips over the Web or word of mouth.  Some of our writers are consultants and some are clients.  We always encourage clients to write for us:  they are an incredible resource for all of us. 

J Do you feel some kind of void in the JDE publishing world that isn't filled by vendor documentation and user groups? What is the JDEtips "value-add"?

A With any ERP package there are going to be opportunities to document just about anything ranging from creative solutions that people have figured out to advanced undocumented tips and techniques.  And really nobody else seems to be doing it on the JD Edwards side.  We do have the Knowledge Garden, which has some advantages, in that the sheer number of documents is more than what we have but the depth on some of those [kg] articles is a little weak. Basically it is written by response-line people and the consultants don't have time to write and are really not involved in it. A lot of it is good stuff.  The only other potential competition is the User Group that has the magazine, but we focus exclusively on tips and techniques and the other folks might be focused more on selling JDE services and related products than on tips and techniques.

J Is there a central theme that runs through JDEtips?

A Our theme is optimization. How does this article help JD Edwards clients optimize what they're able to do with their current software investment?  So, we are trying to help clients get the most out of what they've already paid for.  Optimization  might mean understanding the software better—it might mean improving performance, doing something  they never thought they could do, perhaps in a more automated fashion. 

J What are the challenges you face in coming up with new content every two months?

A The challenges are that not everybody wants to write something for us every two months, so we're constantly looking for fresh, new writers all the time.  And writing, itself, is not easy for most people.  It takes a special effort to document something thoroughly enough to be published.  And I think most clients know that some consultants like to document and some don't; the same for their own people.  There's always the challenge to try to keep up with the market and figure out what topics are going to be the ones that our clients really need to know about.  We try to identify those new areas and find people to write for us in those areas. 

J How do you acquire new subscribers?

A Mark Downs is our main sales person on the JDEtips side and he does a great job.  He likes to at least get an answer from a prospect.  We get very few no's.  Most people are interested.  Maybe they haven't taken the time to look at it yet.  But most people don't say, "no, we're just not interested".  They might have some budget issues right now or they just need more time to evaluate it.

J Don't you also acquire a fair amount of subscribers through the participation of yourself and other consultants in user forums and conferences and things like that?

A Yes, that's true.  We have a nice arrangement with JDElist where we answer a lot of questions that clients pose or that even other consultants pose and so people know us from those postings. I'd say about 25% of our subscribers found out about us from JDElist.  Another 25% probably found out about us at the annual Quest conferences that are run by the user group, so that's really two of the main areas where new potential subscribers find out about us.

J Here's my favorite question:  Why do you do it?

A Great Question, Jon! A lot of people must think we are nuts to do this – we sure have to work very hard to ensure the accuracy and usefulness of what we publish. But, I've always been the type to want to document solutions and I want to share the knowledge.  When it came time to get off the road and have a family and have a "real life" that I decided to take that trait of mine and try to build a business around it.  So far, it's been successful. 

J What part of your personality do you think makes you successful at this venture?

A  Well, you're assuming that I'm successful at it. Seriously – as far as personality goes, I've always been the type that likes to have the knowledge and be able to share it.  I was also a teacher at one point in my life, so I think that's part of why we are so involved with training, as well. 

J Do you have a recollection of your first issue of JDEtips and what kind of response you thought you'd get from the user community and your first positive feedback and things like that? 

A I remember we had a four-page newsletter.  It had been approved by the JD Edwards legal department and the Senior VP of Consulting first, so we knew that we were on safe ground.  We showed up at the Quest user group without even a booth at the conference and I thought I would get 200 subscriptions out of it.  That was just wildly optimistic.  It took about two more years to get 200 companies subscribing.  But, yeah, I remember the early days.  We got excited when we got a hit on the web site the first time! 

J Talk to us a bit more about your optimization strategy,  Of course that strategy involves more than just your publication – the JDEtips Journal – it involves other services as well.  Tell us a bit about your Mastery Level Training and Consulting services.  What distinguishes JDEtips from so many of the firms that are offering these kinds of services.

A Again, it comes down to documenting and knowing advanced tips and techniques.  Our manuals for these courses are written by very experienced field consultants, myself being one of them.  So, we've got about eight courses where we've written our own material from scratch, heavily populated with screen shots of the software, so we "leave no detail unturned" in our search for how to make things work. 

That's a radical difference between us and anybody else.  First of all, I'm not aware of anyone else really having their own training materials of this caliber.  It's the kind of training that can be given to clients even after they go live because in the mad rush to go live, they just haven't had time to learn everything.  So we come back and besides giving them a really solid overview, which makes the course suitable for people with less experience, we just pack it full of all the advanced tips and techniques that we have. 

That's part of it.  The other part of what distinguishes us, besides the training material, is the quality of the people.  Every one of our consultants is somebody that I, personally, have worked with or screened quite closely and they are top-notch in their field.  So we're talking ten, even fifteen years of consulting experience per person. 

So our consulting services feature many of the same experts who write for us and conduct our Mastery Level training.

Another advantage is that most of our people also know the World product, so if a client is moving from World to EnterpriseOne, it's not like we don't know what World does.

J How do you follow the rapidly changing mergers happening in the ERP market? 

A I do a fair amount of research over the Web, so I try to follow what some of the thought leaders like Gartner and some of the pundits are saying about the market.  We follow what JD Edwards is saying and we have some inside contacts, obviously, at JD Edwards who tell us some stuff, but we try not to publish anything before its already been publicly announced.  We also have interviewed top management, from time to time.  I also have this one guy who writes pretty good stuff, named Jon Reed.  I follow what he writes about the ERP market. 

J You are too kind.  Speaking of market trends, what's your sense about the JD Edwards/JDE merger?

A Overall, it seems like a good deal for the client base.  They are gaining what I think will be a stronger company behind the software.  Everything that JD Edwards has said and done so far indicates that they really do intend to keep running all three lines of software:  Enterprise, EnterpriseOne, and JD Edwards World.  They’ve done more with World in less than a year, than JD Edwards did in the last several years.  So I would say so far, it looks promising for the customers because they are going to gain access to JD Edwards functionality that Edwards doesn't have.  They'll still see continued development on the EnterpriseOne and World products.

J What is your opinion about the future of EnterpriseOne and World under these circumstances?

A Like I said, it seems fairly positive right now.  I think JD Edwards is encouraging selected World clients to move to EnterpriseOne – that would be only normal – but with approximately 50% of the client base on World Software, that's not going to happen overnight.  They would not want to abandon that market.  It's a great revenue stream for them in terms of annual fees, so they've got the money coming in where they can afford to continue to enhance the product. 

Previously, I would have guessed that within a couple of years, JD Edwards would announce a new platform that would replace both JD Edwards Enterprise and what was formerly known as EnterpriseOne with a combined product, but as of right now I haven't seen any indication whatsoever that that's actually going to happen.  So, it's entirely possible that ten years from now, you could still have a very strong EnterpriseOne (EnterpriseOne) product.

Another indication that they may keep both product lines, or even all three, going for the next ten years is the fact that nobody has ever developed one software package that scales up to the biggest customers and down to the smallest ones. SAP is a good example, where they acquired a new product called BusinessOne and they're marketing that to the medium-sized companies.  So even SAP can't scale their product down to small customers.  So JD Edwards's strategy is really no different than anybody else's. 

J What about the still-distant storm cloud of the Oracle hostile acquisition of JD Edwards and what is your take on where that's going to go?

A I'd probably have to do a little research on what the latest legal situation is, but I think they have a shot at taking over JD Edwards because the thing that should drive the decision is shareholder value.  It's nice to try to get your customers to write to their congress people, but I think the reality is that this is not an issue of monopolization, but will boil down to perceived shareholder value on the part of the major investors.  It's hard to say.  I think that if it does go through, it's not a good thing – certainly not for Edwards clients. 

J Well, fortunately, there are still some major, huge stumbling blocks and the European Union is now investigating anti-trust issues as well.  It's going to take a while for that to play out.   What about SAP?  Can JD Edwards/JDE compete with the German "Goliath"? 

A That's a good question.  I don't know enough about JD Edwards to know if they are competing successfully with SAP.  I know JD Edwards isn't; not with the biggest companies.  Maybe that's a question for you, Jon.  Do you know anything about whether JD Edwards can make inroads in SAP's client base?

J I'll tell you how I look at that.  The large companies have pretty much made their ERP decisions.  For the most part, it's pretty difficult to go into an SAP ERP shop and sell them your JD Edwards CRM software.  It is just as hard for SAP to go into a JD Edwards shop and sell them their CRM software.  If you're running the core ERP system, that vendor really has the inside track.  If the company goes with a non-ERP choice on top of it, it's usually from some niche best-of-breed thing that's perfect for their industry.  It's not usually something like SAP or Oracle – it’s a niche product of some kind.  As a result, with these large companies, with the exception of a couple of sectors, most of the ERP decisions have already been made and so the only way you can score a big victory in those markets is by going and getting a competitor to rip out its ERP software and install yours.  That just hasn't happened very much.

Right when the Oracle hostile acquisition of JD Edwards starting getting press, SAP did reach out to JD Edwards customers, and won a handful of accounts.  But even then, they only won a few, so that's why I think that a lot of this revenue is coming from selling add-on services to existing accounts.  The only market that's kind of wide open right now is the small-to-medium size market.  There's a lot of these companies that haven't gone in the ERP direction but of course that's a market where no one has an inherent advantage.  If anyone does, I would say it would be Microsoft – not SAP.

A What about JD Edwards?  They have a pretty good footprint in the small-to-medium size market. 

J Yes, I would think that JDE would have a pretty good advantage over SAP in that market as well.  When you read stats about how much of the market share SAP has versus JD Edwards versus JDE, I don't think proportionately that market share is going to change a whole lot.  I don't see how it can.  I don't think SAP is going to "crush" JD Edwards, but I don't think JD Edwards really is going to take market share either.

A In the life cycle of a typical ERP implementation, wouldn't you say every ten or twelve years even these large companies are at least evaluating other options? 

J I think that's certainly possible, but I don't think we've really seen that yet.  We haven't really seen a company say, well, we've done our ten years on this system, we're going to go in a totally different direction now.  But, certainly what we've seen in IT department spending the last few years, its all about incremental spending; not about these major overhauls; so it's hard to say.  I thinks that's probably still a few years out. 

A On a related topic – ERP, whether it's JD Edwards or SAP, has really become just the backbone, or the back office for these companies.  The front office–the customer and supplier interfacing pieces are what's up for grabs, so we have projects like data warehousing, CRM, and Advanced Planning—where IT dollars and personnel are focused right now.  That's where we, as publications and consulting practices, also need to focus some of our energy: providing services in those areas. 

J That's true because the ERP vendors, JD Edwards, SAP, all of them, have been asked to completely change their value proposition, because companies are no longer interested in spending a ton of money  just to get their financials and their human resources working right. 

They want to spend money on things that pertain to customer acquisitions, customer analytics, supply chain enhancement, internet enablement of that supply chain, and those are all add-on products. ERP vendors have been scrambling to address these issues, and like I said, their competition often comes from sophisticated best-of-breed products that are tailored to certain industries and such.  I think you're smart to look at JDEtips as evolving along with the JDE product line—it sounds to me like that's something you guys take very seriously.

A Definitely.

J That brings us right into the next questions, which is:  Where do you see JDEtips going in the next one to three years?

A I see us evolving in similar directions to wherever JD Edwards goes with JD Edwards. So, when JD Edwards announces that they've got an interface that allows JDE clients to use one of the Enterprise modules, we're going to pursue those modules.

We are going to publish overviews, at least to begin with, on this new functionality, and later we'll come in with more in-depth coverage as appropriate.  So, JDEtips clients can look forward to us keeping up with whatever JD Edwards is doing. 

Another evolution is simply the depth and breadth of our coverage.  We're adding about 100 articles and white papers a year, so three years from now, we will have more than doubled the amount of content we have now. 

That means that we'll just have a lot more answers and a lot more situations covered than we do even now.  We're always going to want to maintain a blend of application and technical content.

J You've expanded your editorial team a little bit. You've brought more people in house to help with the production of content, so that's good for you.

A That's worth mentioning.  Probably three years from now we'll have a full time editor as opposed to a half-time editor, maybe even some consultants will be working for us full time doing nothing but creating and researching articles.  I could see where when we get a big enough client base, we could afford to have somebody who specializes, say, in financials, and another consultant/writer who specializes in writing about distribution/manufacturing–actually working for us full time creating great content for us. 

J And that brings us around to another good question, which is once you develop the amount of sophisticated  content you have, part of your ongoing challenge is making that content accessible to your subscribers so they can find the tips they're looking for.  I remember just recently going through your document library and was really impressed with how you had carefully organized all the content.  You had pretty specific functional/technical categories and I could quickly locate what I was looking for.  I was just interested in how the production of content fits in with your Web site and what you're trying to do online.

A One thing we are going to definitely be doing is bringing in more of a search capability, so if you have a specific key word or phrase that you want to search for, you'll be able to find whatever white papers contain that phrase, and that will make the searching of documents even easier.  Other than that, we'll continue to expand and refine our categories of documents as appropriate, so where you might see one category for HR/Payroll now, there might be half a dozen sub-categories two years from now.

J Any other plans for the Web site you want to mention? 

A We're going to try to automate more of the functionality to make it easier for people to subscribe, pay, and gain instant access – to make that whole process more user-friendly and seamless. 

J One thing we haven't talked about that might be relevant to address is the increased trend in off-shore outsourcing and how you see your service offering fitting into a world where more work seems to be outsourced than has been in the past.

A Outsourcing is here to stay–that's for sure.  I'm a firm believer that if you want to continue to make a living in virtually any field, in this global economy, you have to continue to evolve and learn and be able to offer a service that's better than what people can get from the third world.  The gauntlet has been thrown and it's up to us to pick it up and run with it (how's that for mixed metaphors?).  What I am saying is that these kind of situations just offer us opportunities to continue to grow and try to excel and add value that cannot be "commoditized" into an off-shore service.  That means that if we want to survive and thrive, we have to be the thought leaders in the industry.

J I think that's true – it's about staying one step ahead of those trends.  Also, understanding that regardless of specific projects being outsourced, there's still a need for an educated user base.  There's always going to be a need for that.  Your publications fit in with that objective for your client base. We talk about knowledge transfer all the time, and if you don't have consultants to turn to, these articles can really fill a void.  I don't think outsourcing really changes that. 

A I think I forgot to mention that we get some really wonderful feedback when people take the time to write in to us, we really appreciate it and some of the comments are just incredible.  Somebody will say, "I spent weeks trying to figure that out and here's the answer!"  That's what we love to here.  It makes it all worthwhile. 

The ideal image to have and to project would be – we're not just trying to sell you something – we're trying to help you.  Everybody says that, but it seems like we're getting to a point where people are going to start beating down our door and asking us for help because they know we have it. 

J Another thing we didn't touch on, but that I talk about a lot on  the SAP side, but may not be as much of an issue on the JDE side–SAP is constantly putting a spin on its products and their capabilities, and there's so much relevance for an independent voice of expertise that can help you see what really works and what really doesn't.

A Like that whole SEM thing.  I can see SAP really confusing its client base with whatever they say it does, when the reality might be a little bit different.

J Yes, that's a problem, and I think that for clients to know they can turn to you and they are more likely to get an answer that reflects honest implementation experience—that’s a great thing! 

For example, I was just editing a tip last night, and the author pointed out, "most users do this the wrong way", because that's the standard documentation.  It's something that even the vendor might not be fully aware of because they haven't seen it play out the way the consultants who are writing the articles have.

A In one of the modules I'm familiar with, if you press F1 on a field, you get some online help, and in one field, it says, "rebates do not work in EnterpriseOne".  I'm glad I never read that, because I'd been making it work for the last five years.  I'm glad Edwards left it in there, because it's something I can joke about with clients.

We had somebody a few months ago who wanted to use up some of that famous end-of-year budget, and she bought three of our books, and two of them weren't even published at that time.  She just knows the quality is there.  That's exciting.  Not just because of the money, but because we are capable of providing so much better education than most anybody else can.  What it really takes to provide really good education is finding that one person out of thousand people that really knows the module–finding that one person who's willing to sit down and document it, has ten or fifteen years of experience, and really gets a kick out of documenting it.  I know from experience, that person is one in a thousand.  And that's where we do very well—when we find those people. 

J It makes a lot of sense, because that's never going to be a vendor's primary focus. 

A Right.  Their primary focus is to get out and bill clients for consulting hours, and anybody that's at that level is not going to be writing training material or white papers.  But we have the way to do it.

J If I were a potential new subscriber, what would you tell me to convince me to subscribe?

A  I don't want to have to try to convince anyone.  I want them to convince themselves.  I think the best way for them to do that is just to request a free sample issue, with the understanding that this issue may have fifteen articles in it, and I get only one good idea.  But if you multiply that times six issues, times all of that content, then that would easily more than pay for the cost of the subscription. 

Think of all the saved hours in terms of banging your head against the wall and trying to reinvent the wheel.  Think about trying to reinvent the wheel while banging your head against the wall at the same time.  That's not a pretty picture!

J And not to mention that because of the way your subscription is structured with the unlimited readers, there might be only one article that speaks to my situation in that issue, but I can bet that there are probably three or four that speak to the situation of my colleagues. 

A Yes, and we have a fair number of clients that would benefit from getting the word out internally, that they have permission to add an unlimited number of readers to their JDEtips subscription. In a sense we are change agents for the JDE community.

Much of what we publish is not stuff that costs money – it's just stuff that's already there, been there for years, but clients have not learned how to use it or don't know it's there.

J Any parting words, Andy?

A Hang in there, baby!  We may not have all the answers, but we’re working on it.  In fact, if you need an answer to a specific problem or question, write to me at Andy.Klee@ERPtips.com and I’ll see to it that we find someone who can address your issue.  Like any successful business, we take care of our customers.  Maybe we’ll do some research for you today for free, and maybe you’ll remember us the next time you need consulting or training help.