Software and services will live together: Microsoft

BANGALORE, INDIA: IT bellwether Microsoft has come out with Office Business Applications (OBA), which makes 'Office' user's life easy by enabling seamless collaboration of enterprise applications and business applications, as it claims. Javed Sikander, Director Industry Architecture, Microsoft Corporation, speaks about the product, in an interaction with B.V. Shiva Shankar, Associate Editor, CIOL. Excerpts:

CIOL: What is the significance of Office Business Applications, and what is its need in enterprises currently?

Javed Sikander: What we at Microsoft see is that when it comes to personal activities, people are using technology and using it in new ways and seeing great amount of productivity on the personal side. However, when you look at the business productivity, people are still using clunky old interfaces -- backend ERP applications. These are 'one size fit all' applications that were designed for client-server model, and are really not using any of the later technologies and benefits.

There is a divide between personal productivity and business productivity. We call this divide as the 'Results Gap'. Office Business Applications (OBA) is an emerging class of business application that bridges the existing line-of-business systems with the people that use them through the familiar user interface of Microsoft Office. OBA enables businesses to unlock the value of their current set of backend systems by extending the Microsoft Office client and/or Web parts into business processes in line-of-business applications such as ERP, CRM and SCM.

CIOL: What is the roadmap for OBA?

JS: Office business applications allow you to capture unstructured practices that happen on business process and bridge the gap between activities. The first example of OBA is something called "Duet." It is a joint initiative between SAP and Microsoft that we embarked upon few years ago. The idea was for providing Office clients as the interface for SAP users for some of the processes. We are adding new processes, new workflows, within SAP into Office, that's the roadmap. Within Microsoft, we have a division called Microsoft Dynamics, which is essentially an enterprise sort of ERP system for small and medium business companies and other smaller companies. So, Dynamics is also adopting the concept of OBA.

CIOL: What has been the momentum on OBA globally and in India in terms of adoption?

JS: There has been some momentum within India. A lot of services companies based in India are global in nature. The likes of Infosys, Wipro, TCS have spread their wings across the world apart from serving customers within India. By adopting concepts like OBA, they are making a huge impact globally because they have lots of customers in the US, the UK and around the world. We already have three million plus Office installed base here. We have more than 50 SharePoint customers here. We have localized versions of Office 2007, and have some 58+ solutions that are already developed on the Office 2007 and Vista. Recently, McKinsey did a study for us and found that there is some $33 million market opportunity for the ISVs and SIs in India around Office business applications.

CIOL: On which verticals are you concentrating more?

JS: We have these applications covering various sectors like manufacturing, retail, financial services, healthcare, and public sector. But what we have seen is that, in the financial services industries, especially banking, where we have core banking, financial markets, or insurance there is a lot of data analysis. OBA is the way to build the application in this system because those users are already Office client users. So, they are making their lives 10 times easier by allowing them to live in that Office world. In my personal view, I think that financial services sector, including insurance, is the number one beneficiary. The second one I think is healthcare. I would rank in this order -- financial services, healthcare, manufacturing, retail, and public sector.

CIOL: What would be the inhibitors for OBA?

JS: When we talk about legacy, it is not just legacy systems and the way it works. Developers would be writing 14-15 applications simultaneously. They are used to writing everything into the application - they want workforce, workflow system, etc. With OBA, the whole idea of application is different -- app development is all about service composition rather than building a new application. This is a new paradigm shift. Using existing software and extending that rather than building it ground-up requires a shift in thinking, and I think that is an inhibitor. People are not able to think of the benefits.

The issue is of change management. From a development perspective, skills that you need are the same skills sets. A .net platform developer needs same skills sets to develop OBA. We are doing this change by making sure that the existing skills in the IT environment can be utilized. This is a big positive. There is no need to learn a new programming language and programming model.

From a CIO perspective, you are minimizing by positioning -- you are not putting a new interface to the users. If I build a new application with completely new user interface (UI), people do not know the filtering, sorting on the data. There will be training costs. Companies do not have to invest in training the users. Here, users are already trained with Office. So we are minimizing problems at the user's end.

CIOL: Enterprises have already bought enterprise applications and business applications. Now, you are asking them to purchase OBA. Again, there is fresh investment. How can a CIO justify this fresh investment? How can he justify ROI?

JS: Buying the enterprise solution is one stage and implementing that is another stage, keeping it updated with your business activity is one other stage and getting users to do it is yet another stage. So, what happens is that you have made the investment. During implementation, you realize that so many customizations are needed. Then you realize that getting users on it is another thing. And this is where OBA helps. Realize that most of the investment is already in place - the money has already been spent on the ERP application. However, the return on this investment is very low. OBA, by integrating the ERP with the other applications, enables the company to reap higher return on their ERP investment since the users now start adopting and using it.

Furthermore, with OBA, the information on the worker's desktops is unlocked and returned to central IT. Traditionally, this has been a very difficult problem to solve and organizations have had to come up with various ways of extracting intelligence locked in business users' desktops. OBA is built on Office and collaborative, ad-hoc processes, so this elusive intelligence is now within access of central IT. Therefore, the ROI is not just about increasing user adoption of the backend system by changing the interface to Office, the bigger return is on bringing the data on the desktop and ad-hoc collaborative processes within central IT.

CIOL: What would be the future scenario in the business ecosystem, with these concepts creeping in?

JS: We talk about the concept of S+S of Microsoft. We believe that software and desktop will seamlessly work with some services in the cloud. OBA is an example of S+S. The future world is where software and services will live together; where services in the cloud will work seamlessly with the software on the desktop. The users will have a consistent experience, whether they are offline, online, connected or not, whether they are interacting with desktop services et al. That's what we call the S+S world, and that's where I think the world will evolve.

Similarly, the application development will be all about composition rather than building things ground up because composition will allow you to unlock your existing IT assets.