Many in the enterprise software market—users and vendors alike—have been skeptical of Marc Benioff’s “Facebook Imperative.” Salesforce Chatter, the company’s socially-minded enterprise collaboration platform, was introduced at the Dreamforce 2009 conference in November, and went into private beta last month. When the platform went into beta, the Salesforce CEO took to blogs to disseminate the “Facebook Imperative”: the reasons he believes all enterprise software should be like Facebook.

Naturally, most detractors have responded by saying that if enterprise software doesn’t resemble Facebook, there is probably a good reason for it, and one major contention is that social integrations in enterprise productivity suites only create workplace distractions. Salesforce Chatter does admittedly have very Facebook-like features—the profile pages and news feeds look almost identical to the homepage iteration Facebook was running when Chatter was announced—but at the time, Benioff insisted that Chatter was a collaboration tool, and not a social one.

Indeed, the insistence on collaborating above socializing is likely the one to make Chatter and similar platforms enterprise mainstays. Everyone wants real-time functionalities in enterprise, but most are hesitant to think of it in terms of the social for fear of putting these products in the context of leisure. Still, despite condemnations of “Enterprise 2.0,” a plethora of collaboration platforms are jumping on the social bandwagon, and perhaps proving that collaboration suites need to get hip to the Facebook Imperative to survive.

One collaboration platform to make headlines recently was Socialcast’s, as they announced a new activity stream, an Outlook plugin, and an on-premise offering and a private cloud environment. Their name implies a non-enterprise product, and indeed Socialcast was not originally positioned as a workplace application. But this month, Socialcast announced they’re taking their activity-stream collaboration model and bringing it to the office.  With the release of their newest activity stream—dubbed “EASE,” short for “Enterprise Activity Stream Engine”—businesses can utilize Socialcast’s microblogging and social networking services. With their image overhaul, Socialcast is now targeting companies with over 100,000 employees, and is looking to give programs like IBM’s Lotus Software a run for their money.

To sweeten the deal for enterprises with enterprise-sized needs, Socialcast is offering their collaboration platform in the SaaS hybrid model. There are also handy integrations with Outlook, SharePoint, and mobile devices, but offering an on-premise component is being read as Socialcast’s move to make their platform enterprise-acceptable.

Another collaboration company to shift their focus to the enterprise is Socialtext. Socialtext began in 2002 as a microblogging service, but this week they announced the latest iteration of their flagship product, Socialtext 4.0, and to everyone’s surprise, it had suddenly become a collaboration platform. Socialtext users can view activity streams, and join task-related groups for collaboration, and like Socialcast users, can access the client online or on-premise.

As more and more companies endeavor to make microblogging channels the new workspaces, it will be interesting to see which companies take the lead—established productivity suite vendors adding social features to their products, or socially-bent companies looking for a piece of the enterprise market? Of course, we’ve still yet to see if enterprise software pundits are going to do some more serious bucking against the social media-inclined collaboration models that are taking hold. It’s going to be an interesting year, to be sure.

The much-hyped Salesforce Chatter went into private beta earlier this month, and demonstrations given to customers have made a definite effort to highlight the platform’s “fun” qualities—not just its functionalities. On Wednesday, Salesforce CEO Marc Benioff noted in a guest post on TechCrunch that he’s long wondered why enterprise software isn’t more like Facebook, and that the giant social network is the inspiration for the Salesforce Chatter.

Since Chatter was announced last year at the Dreamforce conference, arguments have been made on both sides as to whether or not the enterprise needs this kind of social networking. Now that Chatter has gone into beta, however, people are focusing their attention on whether or not Chatter is a viable threat to Microsoft SharePoint. Yes, SharePoint is widely used, but Salesforce execs note that it is not a “fun” product. It’s functional—and Salesforce Chatter aims to bring both collaborative functionality and, to an extent, entertainment.

Salesforce’s George Hu, the Executive VP of Marketing and Alliances, stated from the first that Salesforce wants to poach from the SharePoint market. Chatter is, of course, very different from SharePoint—SharePoint is a much more traditional collaboration platform, with file sharing over email and through folders, client software, Microsoft Exchange, etc. Chatter’s focus on collaboration mimics the concept of Facebook’s feeds—the necessary information is brought to the user, and they don’t have to mine unsorted data for what they need. In addition, Chatter gives a face and a voice to all employees using it, which can be especially helpful in a large enterprise.

Chatter’s resemblance to Facebook has, in many ways, branded it as a social networking tool, but it boasts some good document sharing and collaboration features, which will likely sway some SharePoint users to the platform. Chatter will be generally released this summer, and users will need to be using the Salesforce CRM platform to access it—this fact could definitely prevent SharePoint users from switching.

It’s tough to say how big a bite Chatter will take out of SharePoint. Chatter has the advantage of social networking, which is becoming a fixture in enterprise despite the fact that many deem it a distraction. It’ll be interesting to hear more about the platform in the coming months, and read more reviews when it’s generally released. We’re also curious to see what kind of competitive improvements Microsoft makes to SharePoint—the platform isn’t static, and surely Microsoft will take some measures to absorb the Chatter-impact.

Microsoft products have found a home in the majority of offices, but mostly in the form of personal productivity suites, like the ever-popular Office. Still, those familiar with, or looking for, CRM and ERP solutions have probably heard of Microsoft’s Dynamics platforms.

There will perhaps always be Microsoft naysayers, but there is little denying that their products must have some merits, given their popularity. Microsoft Dynamics CRM has been extremely popular, and Microsoft released a hosted version of Dynamics CRM 4 in 2008, thereby entering an arena with the likes of Salesforce.com and SugarCRM.

In Microsoft Dynamics CRM 4 Integration Unleased, authors Marc J. Wolenik and Rajya Vardham Bhaiya take a look at best practices, techniques, and sample code for using Dynamics CRM 4 to its greatest extent. Bhaiya and Wolenik recently sat down with InformIT.com, and answered some questions about what exactly, is the appeal of the titular platform.

Wolenik and Bhaiya do justice by the product—they don’t mention any faults, but they do make note of some features companies may be unaware Dynamics CRM 4 has. One thing the two do mention—something anyone discussing the merits of Microsoft productivity software seems to mention—is that it’s built on .NET technology and can be easily extended. Microsoft software is largely supported by existing infrastructure, making it an obvious choice at times.

For those who don’t think the choice is obvious, the authors give some notes to businesses considering Salesforce.com, or another CRM platform. (Unfortunately, the question was posed as “Microsoft vs. established CRM vendors,” so much of the answer aims to prove that Dynamics CRM is established. Wolenik notes that Dynamics CRM goes beyond just “customer” relationship management, and works to consolidate many line-of-business apps onto one platform. Meanwhile, Bhaiya points out that Dynamics CRM allows custom configuration for all of its packages, not just the premium ones (which is the practice Salesforce.com maintains).

The two also argue that Dynamics CRM 4’s integrative capabilities with SharePoint and Outlook cannot be matched, and Microsoft offers a flexible licensing structure for those companies that can, and want to, support an on-premise deployment.
For most companies in search of CRM, though, Microsoft’s big win will perhaps always be the comfort level it offers. Familiar UIs are always nice, and it’s also good to see that Microsoft hasn’t completely turtled in offering other features because of it. We’re curious to see what they come up with in 2010—and if they get even more aggressive with SaaS CRM providers like Salesforce.

This year, cloud computing services and collaboration platforms make for good stories, and this one deals with both. Next week, Big Blue is holding the Lotusphere Conference in Orlando—dedicated to all things dealing with LotusLive, their online collaboration suite—and this week they announced LotusLive’s exciting partnership with Panasonic.

Panasonic has adopted the LotusLive suite for email, calendaring, contact management, web conferencing, instant messaging, file sharing, and project management, and the apps will be available to about 100,000 employees in various departments at Panasonic. LotusLive will eventually be extended to 300,000 Panasonic employees, but the major coup for the suite comes via unseating Microsoft Exchange on Panasonic systems. Panasonic has decided to migrate from Microsoft Exchange, and in turn, IBM’s LotusLive deployment will be the largest cloud computing implementation to date.

The magnitude of the deployment cements the importance of online collaboration and SaaS platforms. We’re bound to see more of each this year, and I’m curious to see how IBM LotusLive competitors will respond. This adoption of LotusLive is also a blow go Google Apps, proving that it isn’t the dominant suite despite adoption by the city of Los Angeles. LotusLive is also cheaper than Google Apps—starting at $3 per user per month, while premiere versions of Google’s suite begin at $50—so we’re likely to see some price warring this year.

As for Microsoft: this is a mighty blow, but they’ll no doubt recover. Windows Azure is going fully live next month, and surely they’ve something up their sleeve. We’re just going to sit back and enjoy the show.

This morning, Microsoft and Hewlett-Packard announced a joint cloud investment: they’ll contribute $250 million for developing and selling private-cloud packages. From the sounds of it, Microsoft’s recently live Windows Azure cloud will be connected to HP hardware.

The new venture is a three-year deal, and will be built on a new “infrastructure-to-application” model, the goal of which is to improve cloud computing by speeding application implementation. Like the many cloud products before it, the new Microsoft/HP venture promises to be cost efficient and simple, as well as to improve interoperability—“as close to plug-and-play as we can [get],” is how HP’s chairman and CEO described the goal of the partnership.

One of Microsoft’s motivations for the collaboration is surely to be able to offer private- and hybrid-cloud products. Windows Azure is a public cloud that went live early in January and is scheduled to be fully deployed and monetized at the beginning of February, and Microsoft had received criticism for Azure being only a public offering.

There are many opportunities private clouds provide enterprises, such private platforms have received a good deal of criticism. On the one hand, private clouds allow businesses to build, manage, and scale applications and services that are hosted by their own data centers. The idea of a “private” cloud also offers some comfort in terms of security issues. On the other hand, private clouds have been derided for locking users into a single vendor or technology. And just this morning, during the “Forecasting Fisticuffs” webinar (in which some esteemed tech pundits discussed their cloud-computing predictions), it was suggested that 2010 would be the year the private cloud would be discredited.

Private clouds’ reputation for such lock-ins has been one of the reasons some are skeptical about this new venture. While many are excited for the full release of Windows Azure, underperforming Microsoft products have left some unconvinced. But we’re interested to see how Microsoft’s new venture plays out, and what kind of news it creates in enterprise.

Yesterday, Salesforce.com announced it would be offering $500 million aggregate principal amount of convertible senior notes due 2015, in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933. In layman’s terms: Salesforce’ll be floating a $500 million convertible bond offering, the bonds are due in 2015, and the cloud-computing evangelists will enter hedge fund transactions to minimize future dilution on shareholders.

Salesforce.com stock has previously fallen 5.5%, to $69.59, but they are still doing extremely well and dominate the cloud-based CRM market—so many people are scratching their heads over why exactly a company with cash is floating debt.

Most likely, Salesforce.com is going to use these funds for acquisitions. Salesforce has long been at the forefront of SaaS CRM, but they still need a strategy to remain at the market’s helm. And as they specified such a large amount of money, it seems less likely that Salesforce is taking advantage of low rates, and more likely that they have a specific use for the money in mind.

Given the completeness of Salesforce’s grasp CRM offering it could be any number of things, but what do you think they have their eye on?

Last week, Dennis Howlett announced some exciting news on both his personal and ZDNet blogs: the ICAEW (Institute of Chartered Accountants in England and Wales) and several UK trade groups will be working together to develop SaaS/cloud standards.

This year, “SaaS” and “cloud computing” business softwares have been discussed nonstop, and those two terms have become largely interchangeable—and at the expense of understanding what each is. As Howlett puts it, “everything getting an _aaS label [is] now conflated into ‘cloud anything’”. The three trade groups are Intellect SaaS Group, the BASDA’s Cloud SIG, and EuroCloud UK, and they will meet with the ICAEW to develop best practices, or some sort of “quality mark” for vendors. The idea is to engage both the buy and sell sides to develop business standards for the erstwhile ambiguous SaaS economy.

In addition to working toward best practices and quality stamps, security (from data to APIs) is another issue to be discussed. But it should be noted that some of the security issues at hand for these groups are EU/UK-specific, and would not necessarily color a similar US debate.  As Howlett sees it, the important objectives are as follows:

1. Clarity for buyers and sellers about issues that are currently causing endless and at times futile debates
2. An opportunity for ICAEW to act as honest broker between buyers and sellers, demonstrating leadership for both members (who may have concerns) and more broadly as a body that has the public interest in mind.
3. A requirement that all trade groups act in concert to help develop business led standards that elevate discussions around technology to a level where business decision makers can readily understand what’s going on and relate it to their business needs and concerns.

He also notes that his extensive experience causes him to be “100%” behind this initiative, but those who don’t share his level of expertise can easily get behind the move as well. The simple fact that this would clarify “SaaS” and “cloud” for buyers and sellers is huge, and seemingly more necessary as the two become muddled. Hopefully we will soon see a similar venture stateside.

Research and Markets announced this week that they added a “PaaS Remains on Edge” report to their offerings, based on studies by Tech Strategy Partners, an analyst firm. A large portion of the report centers on the edge that developers have by developing on Force.com, but there was also a look at how Workday, NetSuite, and Intuit are making space in the enterprise application space.

During Dreamforce 09, Salesforce gave some impressive figures regarding Force.com. They claimed that 135,000 custom applications, and 10,000 sites have been built using the platform, and that 55% of the HTTPS transactions processed come through the API (while only 45% come from Salesforce’s own apps). We did not purchase the report, but it does evidently show how Force.com compares to similar offerings from NetSuite, Intuit, and Workday. Based on the Force-heavy content in the summary, it can be assumed that that PaaS is the favored subject.

Potential Force.com favoritism aside, there are some interesting notes from a study by Tech Strategy Partners. They note that PaaS is beneficial for both corporate and ISV developers, but corporate developers are more likely to leverage a PaaS. The reason being that they are less concerned that ISVs about long-term technology platform lock-in, and have generally different business models. ISVs tend to build applications similar to a PaaS vendor’s SaaS applications, and this adjacency is considered an “edge” (and the apps are “edge applications”).

Another fascinating prediction is that within the next five years or so, there will be less development (among both corporate and ISV programmers) on SaaS-provided PaaS, and that that the favored PaaS deployment will be a hybrid one. We’ve talked about the rise of the SaaS hybrid model before, and it’s interesting to see other services going that way as well. Tech Strategy Partners’ research also points to the fact that the PaaS hybrid model will offer developers the current benefits they reap from the service, as well as greater control over their development processes.

This week, LoopFuse’s VP of Field Operations, Matt Quinlan, sat down with Helpstream’s Bill Odell to discuss utilizing Social CRM to create customer success. Quinlan oversees sales, marketing, and “customer success” at the on-demand marketing automation vendor, and gave some insight into how LoopFuse has been using a Helpstream community to optimize his work. Helpstream is a self-proclaimed provider of Social CRM, and offers integrations for Oracle and Salesforce.com users. Their product is built for web-driven customer service and support, ultimately engaging customers through the creation of a community.

An example of a Helpstream Online Community

One of the interesting points Quinlan made is that Helpstream has been integral to his ensuring customer success as LoopFuse grew. The bigger the company became, the more difficult it was to ensure customers were satisfied throughout the implementation process (in LoopFuse’s fledgling days, assistance was performed on a one-on-one basis). Quinlan states that deploying a Helpstream community allowed LoopFuse to provide better customer service via an interactive, searchable, digital environment.

The suggestion is that having a customer community will soon be as important as having a company website. Now, this isn’t surprising considering the information came from the Helpstream website, but the information’s source doesn’t preclude its validity. Helpstream users are provided with the ability to engage their customers through the community—as opposed to customers passively consuming content—which helps them maintain stronger relationships.

Integrating social media into CRM, creating Social CRM, has been a much-debated topic over the past few years. It’s tough to find a solution that utilizes the technology effectively without creating distractions in office, and perhaps greater adoption and monitoring of the customer community is a step in the right direction. Only time will tell how many other large companies employ similar communities, and with what amount of success, but for now it seems a good way for large companies to reach out to customers with social media—something that’s eluded them for a while now.

SAP is holding their Influencer Summit in Boston this week, and it goes without saying that as a major ERP vendor, attendees are paying very close attention to what they have to say about on-demand solutions. Not surprisingly, SAP has taken to offering non-ERP products this year, in a conscious movement away from their reputation as an on-premise ERP vendor.

This newfound focus on helping companies acquire a network of on-demand tools is a good start at diluting their on-premise standing, and several SAP executives noted in their keynote speeches that their move to the cloud is going to be a structural overhaul. One of SAP’s board members, Jim Hagemann Snabe, spoke of the eventual demise of the three-letter acronym—SAP doesn’t want to deal in ERP, CRM, and the like anymore, and wants to move away from the isolation implied by these divers platforms. This is part of the reason SAP’s latest offering, Business Suite 7, has a non-acronymic name, and the intention is to lower the total cost of ownership and provide enhancements without necessitating a costly upgrade. Snabe also acknowledged that the short-term goal would be a platform through which users can interact with back-end, ERP data, and also be able to work collaboratively via social networking platforms.

Another reason SAP cannot continue as it once did is that large enterprises are finding they can no longer afford the costly upgrades required by on-premise solutions. John Schwarz, another SAP board member, stated that SAP will continue offering on-premise products, but that SAP’s newest enterprise software innovations will be web-based additions to help customers adopt a SaaS-hybrid model. As noted on this site before, the SaaS hybrid model is gaining lots of ground with companies wanting to get more use out of on-premise investments.

Below is a video of ERP pundit Brian Sommer (filmed by Asuret CEO Michael Krigsman), and in it he suggests that on-premise ERP will soon be extinct. The hubbub surrounding the SaaS hybrid model certainly supports this theory, as entirely web-based ERP solutions would be the next logical step. Sommer argues that on-premise ERP systems being slow to change was fine when improvements weren’t occurring at light speed. Now ERP platforms have to keep up with the speed of innovation, and hybrid models support this; yet SaaS hybrid models aren’t for everyone. Sommer predicts that many more large enterprises will move their ERP to the cloud, but entirely cloud-based systems aren’t right for everyone, and the hybrid model provides a nice limbo for companies wanting the security comforts of on-premise solutions. Signs point to on-premise going extinct, but this wipe out may take longer than people expect.