As Informatica Cloud product managers, we spend a lot of our time thinking about things like relational databases. Recently, we’ve been considering their limitations, and, specifically, how difficult and expensive it is to provision an on-premise data warehouse to handle the petabytes of fluid data generated by cloud applications and social media. As a result, companies have to often make tradeoffs and decide which data is worth putting into their data warehouse.
Certainly, relational databases have enormous value. They’ve been around for several decades and have served as a bulwark for storing and analyzing structured data. Without them, we wouldn’t be able to extract and store data from on-premise CRM, ERP and HR applications and push it downstream for BI applications to consume.
With the advent of cloud applications and social media however, we are now faced with managing a daily barrage of massive amounts of rapidly changing data, as well as the complexities of analyzing it within the same context as data from on-premise applications. Add to that the stream of data coming from Big Data sources such as Hadoop which then needs to be organized into a structured format so that various correlation analyses can be run by BI applications – and you can begin to understand the enormity of the problem.
Up until now, the only solution has been to throw development resources at legacy on-premise databases, and hope for the best. But given the cost and complexity, this is clearly not a sustainable long-term strategy.
As an alternative, Amazon Redshift, a petabyte-scale data warehouse service in the cloud has the right combination of performance and capabilities to handle the demands of social media and cloud app data, without the additional complexity or expense. Its Massively Parallel Processing (MPP) architecture allows for the lightning fast loading and querying of data. It also features a larger block size, which reduces the number of I/O requests needed to load data, and leads to better performance.
By combining Informatica Cloud with Amazon Redshift’s parallel loading architecture, you can make use of push-down optimization algorithms, which process data transformations in the most optimal source or target database engines. Informatica Cloud also offers native connectivity to cloud and social media apps, such as Salesforce, NetSuite, Workday, LinkedIn, and Twitter, to name a few, which makes it easy to funnel data from these apps into your Amazon Redshift cluster at faster speeds.
If you’re at the Amazon Web Services Summit today in New York City, then you heard our announcement that Informatica Cloud is offering a free 60-day trial for Amazon Redshift with no limitations on the number of rows, jobs, application endpoints, or scheduling. If you’d like to learn more, please visit our Redshift Trial page or go directly to the trial.
With practically every on-premise application having a counterpart in the SaaS world, enterprise IT departments have truly made the leap to a new way of computing that is transforming their organizations. The last mile of cloud transformation lies in the field of integration, and it is for this purpose that Informatica had a dedicated Cloud Day this year at Informatica World 2014.
The day kicked off with an introduction by Ronen Schwartz, VP and GM of Informatica Cloud, to the themes of intelligent data integration, comprehensive cloud data management, and cloud process automation. The point was made that with SaaS applications being customized frequently, and the need for more data insights from these apps, it is important to have a single platform that can excel at both batch and real-time integration. A whole series of exciting panel discussions followed, ranging from mission critical Salesforce.com integration, to cloud data warehouses, to hybrid integration use cases involving Informatica PowerCenter and Informatica Cloud.
In the mission critical Salesforce.com integration panel, we had speakers from Intuit, InsideTrack, and Cloud Sherpas. Intuit talked about how they went live with Informatica Cloud in under four weeks, with only two developers on hand. InsideTrack had an interesting use case, wherein, they were using the force.com platform to build a native app that tracked performance of students and the impact of coaching on them. InsideTrack connected to several databases outside the Salesforce platform to perform sophisticated analytics and bring them into their app through the power of Informatica Cloud. Cloud Sherpas, a premier System Integrator, and close partner of both Salesforce.com and Informatica outlined three customer case studies of how they used Informatica Cloud to solve complex integration challenges. The first was a medical devices company that was trying to receive up-to-the-minute price quotes be integrating Salesforce and SAP, the second was a global pharmaceuticals company that was using Salesforce to capture data about their research subjects and needed to synchronize that information with their databases, and the third was Salesforce.com itself.
The die-hard data geeks came out in full force for the cloud data warehousing panel. Accomplished speakers from Microstrategy, Amazon, and The Weather Channel discussed data warehousing using Amazon Web Services. A first-time attendee to this panel would have assumed that cloud data warehousing simply dealt with running relational databases on virtual machines spun up from EC2, but instead participants were in enthralled to learn that Amazon Redshift was a relational database that ran 100% in the cloud. The Weather Channel uses Amazon Redshift to perform analytics on almost 750 million rows of data. Using Informatica Cloud, they can load this data into Redshift in a mere half hour. Microstrategy talked about their cloud analytics initiatives and how they looked at it holistically from a hybrid standpoint.
On that note, it was time for the panel of hybrid integration practitioners to take the stage, with Qualcomm and Conde Nast discussing their use of PowerCenter and Cloud. Qualcomm emphasized that the value of Informatica Cloud was the easy access to a variety of connectors, and that they were using connectors for Salesforce, NetSuite, several relational databases, and web services. Conde Nast mentioned that it was extremely easy to port mappings between PowerCenter and Cloud due to the common code base between the two.
Salesforce.com is one of the most widely used cloud applications across every industry. Initially, Salesforce gained dominance from mid-market customers due to the agility and ease of deployment that the SaaS approach delivered. A cloud-based CRM system enabled SMB companies to easily automate sales processes that recorded customer interactions during the sales cycle and scale without costly infrastructure to maintain. This resulted in faster growth, thereby showing rapid ROI of a Salesforce deployment in most cases.
The Eye of the Enterprise
When larger enterprises saw the rapid growth that mid-market players had achieved, they realized that Salesforce was a unique technology enabler capable of helping their businesses to also speed time to market and scale more effectively. In most enterpises, the Salesforce deployments were driven by line-of-business units such as Sales and Customer Service, with varying degrees of coordination with central IT groups – in fact, most initial deployments of Salesforce orgs were done fairly autonomously from central IT.
With Great Growth Comes Greater Integration Challenges
When these business units needed to engage with each other to run cross functional tasks, the lack of a single customer view across the siloed Salesforce instances became a problem. Each individual Salesforce org had its own version of the truth and it was impossible to locate where in the sales cycle each customer was in respect to each business unit. As a consequence, cross-selling and upselling became very difficult. In short, the very application that was a key technology enabler for growth was now posing challenges to meet business objectives.
Scaling for Growth with Custom Apps
While many companies use the pre-packaged functionality in Salesforce, ISVs have also begun building custom apps using the Force.com platform due to its extensibility and rapid customization features. By using Salesforce to build native applications from the ground up, they could design innovative user interfaces that expose powerful functionality to end users. However, to truly add value, it was not just the user interface that was important, but also the back-end of the technology stack. This was especially evident when it came to aggregating data from several sources, and surfacing them in the custom Force.com apps.
On April 23rd at 10am PDT, you’ll hear how two CIOs from two different companies tackled the above integration challenges with Salesforce: Rising Star finalist of the 2013 Silicon Valley Business Journal CIO Awards, Eric Johnson of Informatica, and Computerworld’s 2014 Premier 100 IT Leaders, Derald Sue of InsideTrack.
SaaS companies are growing rapidly and becoming the top priority for most CIOs. With such high growth expectations, many SaaS vendors are investing in sales and marketing to acquire new customers even if it means having a negative net profit margin as a result. Moreover, with the pressure to grow rapidly, there is an increased urgency to ensure that the Average Sales Price (ASP) of every transaction increases in order to meet revenue targets.
The nature of the cloud allows these SaaS companies to release new features every few months, which sales reps can then promote to new customers. When new functionalities are not used nor understood, customers often feel that they have overpaid for a SaaS product. In such cases, customers usually downgrade to a lower-priced edition or worse, leave the vendor entirely. To make up for this loss, the sales representatives must work harder to acquire new leads, which results in less attention for existing customers. Preventing customer churn is very important. The Cost to Acquire a Customer (CAC) for upsells is 19% of the CAC to acquire new customer dollars. In comparison, the CAC to renew existing customers is only 15% of the CAC to acquire new customer dollars.
Accurate customer usage data helps determine which features customers use and which are under utilized. Gathering this data can help pinpoint high-value features that are not used, especially for customers that have recently upgraded to a higher edition. The process of collecting this data involves several touch points – from recording clicks within the app to analyzing the open rate of entire modules. This is where embedded cloud integration comes into play.
Embedding integration within a SaaS application allows vendors to gain operational insights into each aspect of how their app is being used. With this data, vendors are able to provide feedback to product management in regards to further improvements. Additionally, embedding integration can alert the customer success management team of potential churn, thereby allowing them to implement preventative measures.
To learn more about how a specialized analytics environment can be set up for SaaS apps, join Informatica and Gainsight on April 9th at 10am PDT for an informational webinar Powering Customer Analytics with Embedded Cloud Integration.
Within most organizations today, it is not a question of if SaaS applications should be deployed, but how quickly. The era of having to justify adoption of SaaS applications is long over, and the focus has shifted towards a deciding which SaaS applications to deploy, in which departments, and in what timeframes. With this view in mind, let us explore the typical journey that most companies take when deciding which SaaS applications to implement first.
Related: Learn more about customer facing processes vs. customer fulfillment processes in the March 25th webinar ‘Accelerate Business Velocity with NetSuite and Salesforce Integration’
Customer Facing Processes
The main impetus behind switching to a SaaS application is because of the agility the cloud brings. Customizations that normally take weeks to get implemented take minutes or days, and can be performed by employees that do not possess an in-depth knowledge of the technical infrastructure of the SaaS system. With that being said, it is customer-facing processes that require application customizations almost immediately because optimizing these processes results in bringing in revenue quickly into the company, thereby enabling CIOs to show rapid ROI of a SaaS application.
It is no wonder that front-office applications such as Salesforce have become one of the largest SaaS vendors out there today. The entire process of converting a lead to a closed opportunity has several steps in between, and may require multiple workflows in parallel. But the journey doesn’t stop there. To keep customers satisfied and retain them, their product needs to be fulfilled, and this is where customer fulfillment processes come into play.
Customer Fulfillment Processes
Once an opportunity has been closed, the process of getting the product to the customer begins. Traditionally, this role has been done by large-scale on-premise ERP vendors, but leading cloud ERP companies such as NetSuite are showing how the complex task of fulfilling orders and realizing revenue can be done faster. Processes such as applying category-specific price and quantity discounts, special tax regulations involving several regions and nations, and fulfillment through multiple delivery options all have several moving parts. Moreover, the task of invoicing the customer, collecting payment, and recording numerous financial transactions is an entire sub-process in of itself and the only way it can be streamlined is through cloud ERP applications.
Optimizing the Entire Lead-to-Cash Process with Cloud Integration
When looking at customer-facing and customer-fulfillment processes together, it is very clear that SaaS apps in both categories need to work hand-in-hand to ensure that an organization’s customers are satisfied, and continue to engage in repeat business. This is why organizations that are starting the rollout of front-office SaaS applications also need to be thinking about rolling out back-office ERP SaaS applications along with a cloud integration solution to tie it all together. In the March 25th webinar, ‘Accelerate Business Velocity with NetSuite and Salesforce Integration’, we’ll talk about a blueprint for integrating both these types of apps together and how the Australian Institute of Management deployed these apps as part of a multi-million dollar IT transformation project.
An explosion in mobile devices and social media usage has been the driving force behind large brands using big data solutions for deep, insightful analytics. In fact, a recent mobile consumer survey found that 71% of people used their mobile devices to access social media.
With social media becoming a major avenue for advertising, and mobile devices being the medium of access, there are numerous data points that global brands can cross-reference to get a more complete picture of their consumer, and their buying propensities. Analyzing these multitudes of data points is the reason behind the rise of big data solutions such as Hadoop.
However, Hadoop itself is only one Big Data framework, and consists of several different flavors. Facebook, which called itself the owner of the world’s largest Hadoop cluster, at 100 petabytes, outgrew its capabilities on Hadoop and is looking into a technology which would allow it to abstract its Hadoop workloads across several geographically dispersed datacenters.
When it comes to analytics projects that require intensive data warehousing, there is no one-size fits all answer for Big Data as the use cases can be extremely varied, ranging from short-term to long-term. Deploying Hadoop clusters requires specialized skills and proper capacity planning. In contrast, Big Data solutions in the cloud such as Amazon RedShift allow users to provision database nodes on demand and in a matter of minutes, without the need to take into account large outlays of infrastructure such as servers, and datacenter space. As a result, cloud-based Big Data can be a viable alternative for short-term analytics projects as well as fulfilling sandbox requirements to test out larger Big Data integration projects. Cloud-based Big Data may also make sense in situations where only a subset of the data is required for analysis as opposed to the entire dataset.
With cloud integration, much of the complexity of connecting to data sources and targets is abstracted away. Consequently, when a cloud-based Big Data deployment is combined with a cloud integration solution, it can result in even more time and cost savings and get the projects off the ground much faster.
We’ll be discussing several use cases around cloud-based Big Data in our webinar on August 22nd, Big Data in the Cloud with Informatica Cloud and Amazon Redshift, with special guests from Amazon on the event.
It’s no secret that software as a service (SaaS) applications like Salesforce CRM, Eloqua, Workday, NetSuite and Concur, to name a few, often get their start in the enterprise through individual departments, divisions and subsidiaries. Known for their rapid deployment times, frequent feature releases with API updates and end-user ease of use, SaaS applications are typically much more dynamic than on-premise business applications. New fields and objects can be added with a few clicks by line-of-business administrators, analysts and operational roles. So when it comes to data integration, waiting for IT to redevelop and deploy mappings every time there is a metadata change typically doesn’t meet the expectations of business users and application owners, who are used to greater speed and agility in the cloud.
The Informatica Winter 2013 announcement included the following customer quote:
“The Winter 2013 release will accelerate the time it takes to access, integrate and deliver valuable data in order to meet our business imperatives.”
It was also noted that, “the new Informatica Cloud user interface will make the cloud integration solution even more user friendly.” There are a number of user experience enhancements with this upgrade, so I sat down with Joshua Vaughn, Principal User Experience Designer for Informatica Cloud, to learn more about the impetus behind the new design and features, what’s on the horizon for the future releases, and why user interface (UI) design is so important for cloud applications.
Did you know that Forrester estimates in their 10 Cloud Predictions For 2012 blog post that on average organizations will be running more than 10 different cloud applications and that the public Software-as-a-Service (SaaS) market will hit $33 billion by the end of 2012?
However, in the same post, Forrester also acknowledged that SaaS adoption is led mainly by Customer Relationship Management (CRM), procurement, collaboration, and Human Capital Management (HCM) software and that all other software segments will “still have significantly lower SaaS adoption rates”. It’s not hard to see this in the market today, with cloud juggernaut salesforce.com leading the way in CRM, and Workday and SuccessFactors doing battle in HCM, for example. Forrester claims that amongst the lesser known software segments, Product Lifecycle Management (PLM), Business Intelligence (BI), and Supply Chain Management (SCM) will be the categories to break through as far as SaaS adoption is concerned, with approximately 25% of companies using these solutions by 2012. (more…)