One of the arguments regularly put forward by the Cloud Computing pure-play applications vendors, such as Salesforce.com and NetSuite, is that is incredibly difficult, if not impossible, to move from an on premise business and technology model to an on demand one. Thus, the argument runs, the likes of SAP and Microsoft will struggle because of their legacy base and architectures.
How then to explain FinancialForce.com? For those who missed the memo, FinancialForce is the 2009 manifestation of what had been a two year plus initiative by financial software firm Coda to produce a Software as a Service (SaaS) version of its popular on demand products. But hold on a minute: if it's near impossible for the likes of SAP to make such a move, how does Coda pull it off? The answer to that apparently was to be Coda's use of Salesforce.com's Force.com development platform.
Even so, the project seemed to rumble on for a suspiciously long time without apparent deliverables. That was until earlier this year when out of the blue FinancialForce.com was created. An on demand spin-off from Coda, FinancialForce.com also has Salesforce.com as a minority backer and stakeholder and as a stand alone venture may be able to avoid the bastardisation of revenue streams that blight so many on premise vendors in their move to the Cloud. (Cynics would also suggest that the standalone nature of the beast also allows it to be put to rest quickly and efficiently if the venture were to fail....)
But that sort of cynicism isn't going to wash with CEO Jeremy Roche who reckons that this is exactly the right time for FinancialForce.com to be launching into the market, especially in the US for the immediate future. “The market for Cloud in general is just more advanced in the US. It's also where the market presence of Salesforce.com is greatest, although Europe is catching up,” he notes. “If you look at the likes of the Dreamforce conference, there are still a lot of C-level conversations going on about why a company should be looking at the Cloud rather than about why they are already looking at it.”
What's the pitch?
So given that reality, what's the FinancialForce pitch to these curious C-level execs? “There are two main pitches we make,” explains Roche. “One is that of the creative real time accounting engine on the Salesforce.com platform which is of most appeal if you're a Salesforce.com customer. If that's who you are, this will enable you account for anything 'out of the box'.
“If you're not a Salesforce.com customer and you are looking for Cloud accounting, then the pitch is that we offer a real time accounting engine that is always in balance and always up to date. It's not just a set of ledgers that are now running in the Cloud. It's specifically designed to be online and to provide up to date information thats driven through with real time analytics which you can run in as many different dimensions as you like. It provides you with workflow right across the front and back office.”
Roche is particularly enthusiastic about Salesforce.com's recent introduction of Chatter, the s0-called Collaboration Cloud that the firm hopes will enhance collaboration across enterprises. Chatter will come bundled with existing Salesforce.com offerings as well as as a standalone offering. Roche talks about the prospects of integrating the Chatter functionality into his own offerings as well. “I'm looking at Chatter on the basis of what it does,” he says. “Chatter will be integrated into our releases. We will be referring to it as collaborative accounting.
“We have been talking about creating collaborative accounting packages for over a year,” he says. “You can have people monitoring and running activities. You don't need to have a trigger set up to alert you when your bank account is running low for example. One of the things that seems to be compelling is the interconnection between the front and back office which means that the sales guys are not left to be seen as the odd ones out.
One possible application for Chatter that has been suggested is the relatively untapped market for instant messaging in the financial services market. This has been an area of some difficulty with security concerns being cited as the primary inhibitor to adoption. This is something that Chatter might be able to address. “The Salesforce.com approach is going on within the firewall and that's a major differentiator,” suggests Roche. “There are lots of organisations that block messaging and Twitter and so on. There are firms that are happy to run Microsoft Communicator within the firewall or take the idea of emails flying around and run the communicator alongside.
“But the thing you don't capture there is that when those conversations take place the data is transient or if it's via email then it's locked in people's emails. So what you end up with is a lot of silos of information around the organisation. With collaborative applications you are able to capture the conversation as part of the knowledge base behind the firewall. A classic example would be an accountant who's got a random invoice that's turned up and the PO hasn't been raised or whatever. How much time do people waste on that at the moment, trying to chase down the information needed? What we're doing is enabling people to select the information that is allowed out of the organisation.”
Early adopters
So who's buying into the FinancialForce vision? Well, one of the first up is Telegraph Media Group, which has fast become a poster child for Cloud applications through its use of Salesforce.com, SuccessFactors and Google Apps. Add to that FinancialForce. “They already run all their ads and media sales though Salesforce.com,” notes Roche. “They are a very happy user of Aggresso's ERP. We as FinancialForce sit in the middle. We collect all the transactions that run through both. That's a key element of the market that is evolving. You don't have to throw out what you rely on day to day on day one. We're not proud when it comes to this. You can run our new stuff in parallel. The big opportunity for us the old legacy accounting stuff or converting old versions of Great Plains. There a lot of systems out there that people just haven't touched for years.”
But what about the concept of the Cloud itself. Isn't it a term that puts many people off or which equally many don't understand? “We are selling this as Cloud,” insists Roche. “But we are modifying the terninology for some in the accounting community. The terminology has evolved. It's gone from on demand to SaaS to Cloud. We do have to explain that to accountants because they haven't got to the question of Cloud definitions as yet, although we have reached the stage where CIOs are explaining the terminology and the concepts to other parts of the organisation.”
But isn't it better to turn to a single source vendor rather than mess around with integration. That's the mantra propounded by the likes of NetSuite CEO Zach Nelson. Roche is phlegmatic about this world view. “If that's what you want then you should talk to Zach Nelson,” he says. “But Salesforce.com has 69,000 customers who demonstrate that are buying best of breed applications. They want good, fast, lean applications that are quick to deploy and customise. They are not buying into legacy applications that are delivered by yet another methodology. What that taught me is that we needed to build an application that is fleet of foot. It's a very different way of working from taking a one size fits all approach.”
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