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Sold out. That was the sign on the door of the Microsoft launch of PerformancePoint in London on October 16th 2007. Three hundred customers and partners crammed into Vinopolis to hear about Microsoft’s aspirations for PerformancePoint, along with presentations from Professor Robert Kaplan (co-founder of the Balanced Scorecard concept), and senior executives from Accenture, CapGemini, Tata Consulting and the IMGroup.
This is significant because Microsoft has the big management consultants as a channel to market for PerformancePoint. This has not always been the case in the past. Large management consultants have often preferred to work with the likes of SAP. Clearly the management consultants can sniff big bucks to be gained from knitting all the Microsoft software pieces together and from large scale global deployments (they hope!). Eddie Short, VP at CapGemini, said he would have 3,000 consultants trained in PerformancePoint by the end of 2007.
Microsoft has traditionally sold a whole IT “stack” based on SQL Server to IT Departments. With PerformancePoint, Microsoft is moving towards the more traditional enterprise software sales model associated with the likes of Oracle and SAP. This model is about selling business benefits to CFOs and other senior business managers rather than technology to IT. Microsoft has recruited a 100-strong experienced BI/Performance Management applications-oriented salesforce from the likes of Business Objects, Hyperion, and Cognos to do this. This leaves the management consultants to snaffle up most of the services revenues, for now, anyway.
Microsoft claims that PerformancePoint provides an “end-to-end BI offering”. These are the same words that Business Objects uses when it talks about BusinessObjects XI. However, this is where the similarity ends, according to Microsoft. Business Objects (now part of SAP) has many different acquired technologies to integrate, as does Oracle, whereas PerformancePoint is fundamentally a Microsoft in-house development. There is some truth in this, although over the years Microsoft has acquired the technologies of at least 4 different software vendors to get them there; the most important in the case of PerformancePoint being analytics and visualisation vendor ProClarity.
The tag line around the PerformancePoint is MAP—Monitor, Analyse and Plan. Business Scorecard Manager (BSM) is now integrated into the PerformancePoint suite rather than being a standalone. Excel compatibility and SQL Server as the platform are central to the value proposition i.e. “PerformancePoint enables customers to leverage their existing Microsoft investments”.
More compelling is the cost story. A server licence costs $20,000 and a per client access licence $195. In cost terms this takes the product into the domain of the open source BI vendors such as JasperSoft, and low cost operators such as LogiXML and Sage.
PerformancePoint is not yet the complete finished item. It still lacks some components of the complete end-to-end BI offerings, such as data quality. However, it is a compelling commercial offer. As SAP and Oracle struggle to align their disparate BI/PM offers, an opportunity exists for Microsoft to get into disaffected corporate accounts and to make inroads into the relatively poorly served mid-market.
10,000 companies participated in their Community Technology Programme (CTP) for PerformancePoint, including many large companies planning big roll-outs. In addition, over 1,000 Microsoft business partners have been trained. It’s early days yet, but one could imagine an SQL Server scenario, with slow initial sales accelerating and blossoming by 2010 into a market leading (by units sold anyway) position.