Tag Archives: Outer Ring

Avoiding the Vortex: Successful Postmodern ERP & Information Management Strategies


Or in other words leveraging both:
Digital Innovation and greater Business Insights = i Squared

Blog by Tim Main – IBM Analytics – Information Management and ERP – Technical Director

24th January 2018

Executive Summary – The challenge facing CxO’s, CIO’s, CTO’s and Chief IT Architects

It is clear businesses across multiple industries are having to manage unprecedented rates of technology change, whilst concurrently having to Innovate to both manage and address new “Digital Platform” challengers and/or adjacent industry competitors.

Where prior physical asset centric “Leverage our global scale and reach” business models are being challenged by asset light digital partner eco systems.

Businesses need to effectively balance global scale and reach with local flexibility, agility whilst still being response to Insight driven innovation and adaptability, in the past this was described this as the “GLOCAL challenge”.

As both senior business leaders (CxO’s) and aligned senior IT Executives (CIO’s, CTO’s, CDO’s, Chief Architects, etc) have to both make and balance complex strategic Digital Innovation and IT Investment priorities, choices and trade off decisions.

Within this context it’s relatively easy to be drawn back towards what would have been considered to be prior safe “major ERP platform” eco system aligned solution investments, we are a SAP shop or an Oracle shop etc.

However, in the practical reality a postmodern ERP and Information enabled age, these prior safe choices can rapidly turn into a storm / sink hole “vortex of IT investment/s”.

Where unless carefully managed they then carry a significant risk diverting finite strategic IT investments away from front office Insight driven digital innovation.

Where these are firmly targeted at customer and channel enabled relationship and revenue growth opportunities that typically generate a faster real rates of return / ROI with a significantly lower “start small prove (or fail fast) and scale fast” risk profile.

If we accept the principle that “Factory IT and “Innovation IT” (Some call this Bimodal IT) naturally operate at very different rates of change, often with different, disparate supporting technology stacks  and architectural building blocks (ABB’s).

Then as a direct consequence Enterprise Clients need to develop both strong and viable Enterprise Application Integration (EAI), DevOps and Information Architecture and Information Management architectures (IA & IM) in parallel.

Let’s call this Dev/Ops plus the “other eAI” and IA + IM for a moment, or indeed the eAI and IA + IM “Twins”  plus the AI/ML Ladder as described below.

We then end up with a Business into IT Strategy construct that could be summarized as follows:

Screen Shot 2018-01-25 at 16.04.00
Figure 1 – Essential Capabilities in a Postmodern ERP environment.

Then within this context we have a framework to prioritize both capability development in critical Digital Innovation (or/or disruption) and information driven insight area’s to help respond challenging business into IT Innovation requirements and that operate at viable rates of change.

Some traditional or hybrid postmodern ERP vendors and their implementation partners (CSI’s) will typically strongly recommend that a re-implementation and simplification of typically deeply customized core ERP (transactional) application template and MRPII planning systems is a prerequisite for effective Digital Innovation in the front office, in addition to relatively tight coupling of “Edge ERP” / SaaS portfolios with the prior Core ERP / SAP NetWeaver functional portfolio’s.

Personally I do not subscribe to this point of view for the following reasons:

  • Whilst essential, typical ERP processes are no longer differentiating capabilities vs simply being “must have, must work, table stakes” whilst needing to be cost efficient and optimized where practical relative to the required effort and/or ROI, not re-engineering one set of ledger structures for AN other.

    A number of Clients I talk to are actually deciding to “Digitally Innovate” around the edge of prior Core ERP Investments in a hub and spoke or 2 tier ERP modelIndeed the DSAG Investment Survey from late 2016 into 2017 was a clear pointer in this respect plus the latest DSAG 2018 Survey that can be found here.

  • We have observed the strong emergence (& acquisition and/or integration) of SaaS based “Edge” complementary ERP providers leveraging SaaS / Cloud native delivery models, examples include:
    • Workday, (HR) NetSuite (ERP), Salesforce.com (CRM+), Anaplan all come to mind..
  • Even for the “Mega ERP” vendors like SAP and/or Oracle, have typically acquired “bolt on” complementary SaaS solutions (for example SuccessFactors, Concur, Fieldglass, Ariba) which are built out on disparate information management and platform architectures.Hence these also depend on effective API/Microservices integration and flexible Information Integration, Management and Governance processes and flows back to a given ERP core.
  • Additionally, when we then examine typical new Dev/Ops and/or Open Sourced enabled front office Digital Innovation and Insight driven workloads.These tend towards being clearly back office “ERP System & Ledger Neutral” and open standards enabled as the majority need to seamlessly integrate with extended eco systems of partners, channels, supply chains. In this case a homogenious ERP+ platform strategy actually then becomes a Digital Innovation inhibitor vs enabler.
    Where one thing is clear in ERP platform terms, these will simply not be uniform or indeed dominated by a single ERP provider; examples include IoT, Blockchain, Extended Collaborative Logistical and Manufacturing 4.0 Supply Chains, Big Data, API Enabled Weather Data etc
  • Typically implementing Modern, Consumable User Interfaces (UI’s) like SAP Fiori vs the prior very network efficient SAP GUI are and/or should not be dependent vs independent of application logic or data platform choices (a layered SAP NetWeaver and/or fundamental SOA design & separation of duties principle).

A number of these topics are discussed in a Gartner Paper (G00311163) “Schrodinger’s Cat: How ERP is both Dead and Alive” Published on the 28th of June 2016.

Which I would recommend as further reading material, also there are a number of papers from Forrester, SAP and other providers that describe 2 Tier ERP strategies and solutions that mostly all revolve around a hybrid strategy of complementary SaaS / ERP / Best of Breed capabilities around an existing deployed, customized and working ERP Core.

Now let’s move on to consider what are the essential strategies and capabilities a typical large Enterprise client needs to develop to be successful in a postmodern ERP environment and information age.

A number of these data management capabilities are described in a “Stretch the three C’s” Context – Culture, Competency and Capability” in a recent Forrester Paper by Brian Hopkins, published on January 10th 2018 – “Stretch Your Data Management Capabilities”

Also I’d recommend the following Blog, by the General Manager of IBM’s Analytics Business, Rob Thomas which uses a motor industry analogy to describe the logical steps and prerequisites that are required to successfully navigate the AI (Artificial Intelligence) and Machine Learning (ML) Ladder.

With a guiding principle being to gain increased business insight, value and/or process automation (or RBA) there is simply put no AI or ML without a clear Information Architecture (AI) and Information Management (IM) strategy, plus a step wise logical approach to developing capabilities and maturity working step wise up the AI/ML maturity ladder.

Hence in terms of a Line of Business and/or IT Executive recommended course of action in this context would or could then be an appropriate combination of:

  1. Avoid being drawn down the complex re-implementation of back office ERP function spiral or Vortex..

    Unless it is a natural time for a complete refresh of your ERP platform / application template and aligned back office business processes vs an “optimize of what you already have strategy”.

  2. Find way to increase the efficiency and optimization of your existing ERP, SAP Business Suite / NetWeaver platform investments to free up IT Investments for:
  3. Increased Front Office, System of Engagement, Insight and Digital Innovation investments.
  4. Enabling new value creating Cognitive solutions via IBM Watson API’s services integration.
  5. Build out a clear Information and Data Management Strategy as a foundation for:
    • Artificial Intelligence (AI) and Machine Learning (ML) enabled Business Insight & Value

      ..following a logical step wise AI / ML “Ladder Strategy” and capability development.

    • Also as a sound information foundation for continued Process Automation (and/or RPA)
    • Develop an effective Information Architecture (AI) and Information Management (IM) and Data Governance and Security (DG&S) strategy

      Understanding for example that Data Lakes projects, without a parallel and sound information management and governance strategy typically fail to deliver the expected ROI, unless this aspect is properly addressed upfront (in particular within regulated industries and/or for example where GDPR clearly applies).

    • Look closely at providers within your Information Management “Eco System” do they offer a combination of flexibly choice, scale with platform integration vs point solutions
    • Enable a clear, Open Source enabled and leveraged strategy to effectively combine both “Big and Little Data” sources (Data at Rest + Data in Motion, SQL Schema Before & After)
    • Employ tools and methods (like IBM’s Data First Method) to define existing Information management maturity and required target capabilities aligned to specific Line of Business (LoB) sponsored and value creating use cases.
    • Develop parallel Application API / Microservices and Information Integration and Management Strategies and architectures (the twins represented by the top and bottom half of figure 1)
    • Ensure that ERP vendor driven proposals that re-engineer often working ERP solutions have realistic and accurate ROI vs risk vs cost / investment profiles.Refer Note *

    • Look closely at solutions that balance a standardized Core ERP processes with locally optimized front office process automation as per the following diagram.(apologies for the old style SAP logo, but this is not a new strategy, also as per the prior Veissmann IBM SOA + SAP White Paper I previously referenced)

      Pendulum Screen Shot 2017-06-08 at 00.57.20 copy

      There is a good case study / example of striking this balance at Carlsberg

  6. Enable a clear, flexible Dev/Ops platform management strategy and API/Microservices integration capability (inner / outer ring ESB / API integration hubs)  Refer my prior Blog on this topic

Note * We have observed that significant ERP re-engineering projects can become all engulfing in focus and IT budget terms may take and cost x2-x3 times the initial budget & time estimates.

Sources of information researched for this Blog item include, but are not limited to:

  • The road to AI leads through information architecture – Rob Thomas IBM GM Analytics
  • Gartner Paper (G00311163) “Schrodinger’s Cat: How ERP is both Dead and Alive”Published on the 28th of June 2016.

    Authors: Denise Ganley, Coral Hardcastle plus various related Gartner ERP platform and market related papers.

  • SAP S/4 HANA as the Digital ERP Core for organisations on a Digital Reinvention journeyMark Dudgeon, IBM CTO SAP IBM Global Services – January 5th 2018

    IBM offers a S/4 HANA Impact Assessment Service as follows

  • Forrester – Stretch Your Data Management Capabilities by Brian Hopkins, Jan 10th 2018Continuous Improvement: The Data Management Playbook
  • IBM’s Institute for Business Value – The Software Edge to drive competitive advantage
  • SAP S/4 HANA: From 2 Tier ERP to the N Tier Enterprise – Fall 2016, Joshua Greenbaum
  • Forrester – It’s time to clarify your Global ERP Strategy. Dec 2010, George Lawrie

Also I would refer readers to an excellent IBM Institute of Business Value study that looks at Innovation in an API Economy which can be found here.

Open Source and Standards driven enabled and business process optimization

My prior Blogs, LinkedIn items on:

API / Microservices “Inner / Outer Ring” ESB / Messaging and Application Integration

Via IBM’s API Connect, Node RED, IBM Watson IoT Capabilities

Including the following related Dual Speed IT Summary approach

Dual Speed IT Strategy v1 170717

The opinions within this blog are the authors, they do not represent a formal IBM corporate point of view, copyrights are respected and/or sources acknowledged and referenced as and where applicable.



API / Microservices Business Innovation and Solution Enablement Strategies

Or in other words what does a Post-Modern ERP strategy look like?

The Hunter Becomes the Hunted Image at 180717

Blog by Tim Main – IBM Information Management and ERP – Technical Director

17th July 2017

Executive Summary – The Question?

A number of months ago I was asked by one of my experienced and senior colleagues in the IBM SAP Implementation and solutions technical community the question what might “A Post-Modern ERP Solution Landscape” look like?

This followed a similar prior question from the CIO of a significant European Pharmaceutical  concern and the recent DSAG SAP CIO Investment Study of 269 German speaking CIO’s from November 2016-January 2017.

Where ~ 50-60+ % of these CIO’s essentially identified increased strategic IT investments in Digital Innovation as a key priority, whilst up to 50% did not currently consider SAP S/4 as an alternative to their existing often customized and broadly deployed SAP Business Suite / ERP deployments.

Consequently linking back to my prior blogs in this area, I decided to explore what a “Post -Modern ERP Landscape” may look like leveraging an open API / Microservices architectural integration construct that seeks to “Innovate with new + integrate + leverage existing” ERP Systems of Record applications scenario.

It maybe suggested by some ERP vendors that a migration, upgrade and/or remediation of prior customized, business process aligned SAP Business Suite functionality onto SAP S/4 Enterprise Management is linked as a prerequisite to the ability of an Enterprise to Digitally Innovate.

Recently Philip Howard, Information Management, Research Director at Bloor Research has published a paper looking at the Myths of SAP HANA which can be found here.

From my point of view, and likely more importantly from the view of a number of Enterprise Client Chief Enterprise / IT Strategy Architects I have spoken to, we simply don’t see this firm or direct linkage, in fact the reverse seems to be true in an Open Source / Open Enabled Digital Innovation world.

Where the focus is correctly on enabling the integration of new front office Digital Innovation IT solutions (enhanced Systems of Engagement, Systems of Insight, Systems of Innovation) vs remediation of prior Systems of Record / ERP solution investments.

If we accept this fundamental strategic assumption, we can then go on to consider a number of the “layers of the cake” in terms of Business Innovation into IT technology strategy and prerequisite capabilities.

The Resulting Strategy – High Level Strategy – May look something like?

An Open Business Domain : IT Transformation Viewpoint v2 180717

This also links back to my prior analysis of “Factory IT” and Innovation IT” following a Harvard Business Review (HBR) – Business into IT Strategy Review Paper in 2008/9, where this is now more commonly referred to by IT analysts like Gartner and/or Forrester as “Bi-Modal or Dual Speed IT”.

Further details on “The Layers of the Cake”

Open Business : IT Transformation View - Details v1 140717

From my point of view one of the most important and strategic aspects of an effectively implemented API / Microservices strategy is to enable, deploy and govern a layer that acts as a layer of graphene or graphite, gearing and lubrication between the rapid pace of innovation and change demanded by the business of Innovation IT.

Whilst pragmatically recognizing that Factory IT needs to operate at very different speeds from a change and release perspective whilst still communicating and passing data between these two layers effectively.

A “Back to the Future” IBM SOA Solutions for SAP from 2008

Whilst researching in preparation for this blog I was repeatedly drawn back to a prior IBM SAP SOA Client White paper at Viessmann that describes SOA (Services Orientated Architecture) solution enablement to complement the Clients prior and significant SAP Business Suite / ERP investments.

This paper essentially described the principles of a flexible IBM SOA enabled front office application integration/s strategy for client and channel facing and line of business applications, helping Viessmann to deliver increased business flexibility and enhanced customer service and productivity to support the needs of a growing business.

Being a firm believer in “Back to the Future” Scenario’s within the IT Industry, I was very naturally happy to look back for a proof point to then look forward again.
The summary paper describing this project can be found at

In its simplest terms this case seemed to cover a number of the key aspects for a client to consider in a “Post Modern-ERP Scenario”.

However this said, I’m often then challenged by existing EAI (Enterprise Application Integration) teams on the question “but we already have a deployed and working ESB, why do we need an “Inner Ring / Outer Ring” hybrid API / ESB architecture” which I’ve attempted to explain in the following two diagrams.

The fist diagram comes from an excellent “Integration Throughout and Beyond the Enterprise” IBM Redbook that can be found here.

Figure 1.1 and Figure 1.2 in particular nice summarizes the differences in the prior SOA focus and the SOA + API Economy focus.

Figure 1.2 from API Redbook

Additionally, in the following diagram after reviewing and consuming the API for Dummies Wiley book that can be found here, I’ve attempted to summarize the differences and positioning of this dual ring API / Microservices and ESB / EAI enabled strategy.

High Level Strategy - API Microservices Enablement at 180717

Then I have pulled together a couple of diagrams (on the basis a picture is worth a 1,000 words) that consider the key factors from both a business and technical point of view on the positioning of API enabled Microservices vs ESB enabled Enterprise Application Integration (EAI) as follows, whilst a little busy they are both self-explanatory.

The Wikipedia description of Microservices seems to nicely summarize the combination of loosely coupled, fine grained services to enable agile and flexible development initiatives combined with “re-factoring” and/or re-facing of existing systems into the post-modern ERP world.

“In a Microservices architecture, services should be fine-grained and the protocols should be lightweight. The benefit of decomposing an application into different smaller services is that it improves modularity and makes the application easier to understand, develop and test. It also parallelizes development by enabling small autonomous teams to develop, deploy and scale their respective services independently.[1] It also allows the architecture of an individual service to emerge through continuous refactoring.[2]Microservices-based architectures enable continuous delivery and deployment.”

Recently the University of Manchester has been doing some very innovative work looking at the layered properties of Graphene for water filtration this work as described and summarised in a recent BBC Science & Environment item on the 3rd April 2017.

Graphene Image from the BBC web site - 3rd April 2017

For me this provided a nice analogy of what we are seeking to securely do with an API / Microservices IT architecture where we have “Inner / Outer Ring” layers of the business and application integration cake that enable loosely coupled clusters of fine grained “SOA” like services to work.

Where solutions like IBM’s API Connect provide proven secure  “appliance based” strategies for the outer ring whilst integrating and safely filtering / passing fine grade API’s enabled data to and from with the clients existing inner ring ESB.

This diagram below attempts to summarize the differences in nature between an API  / Microservices appliance and a typical ESB for Enterprise Application Integration (EAI).

Integration Topologies Inner Outer Ring v3 170717

And from a business into technology point of view in terms of grouping, use case alignment.

Example Mapping Functional Capabilities at 180717

Then we simply need to layer in capabilities in the new “Two Triangles” worlds of SQL schema before and SQL schema after “Big and little data” and we have a foundation from which to build.

Supporting Data Management and Information Management Strategies.

In my prior blogs I’ve described the supporting “Two Triangles” (SQL Schema before and SQL Schema after) data worlds that needs to be developed in parallel with a viable API / Microservices strategy, this is very important to avoid the API / Microservices enabled business solutions becoming “islands of information” that are isolated from each other.

Where a critical objective of an API / Microservices economy is to leverage information insights for strategic and competitive advantage including both prescriptive and predictive analytics in addition to the more common descriptive analytics.

At the risk of a slightly longer Blog item, this architectural approach is summarized and described below, where the “Insight into Action” activities maybe both API / Microservices enabled and linked to aligned cognitive / intelligent business process optimization tools and IT capabilities.

The Two Triangles Information Strategy v2 170717

Inhibitors and Enablers

In this diagram, I’ve attempted to summarize the key enablers and inhibitors for a successful API / Microservices deployment strategy:

Key inhibitors and enablers for an API Strategy 170717

Critical Success Factors

Understanding that ultimately a successful API / Microservices strategy starts with the business digital innovation agenda and strategy and then flows down into the enabling IT capabilities, whilst initially bottom up API / Microservices projects are a way to start small and scale fast, ultimately it will require a top level down strategic investment led strategy.

Critical Capabilities - Executive IT Architectural PoV at 180717

Also I would refer readers to an excellent IBM Institute of Business Value study that looks at Innovation in an API Economy which can be found here.

Open Source and Standards driven eneblement and business process optimization

In my view for an API / Microservices strategy and economy to succeed it requires a clear and long term commitment to Open Source Solutions and the definition of Open / Published API / SOA messaging formats and standards.

IBM has a very significant and clear track record in this area, including in recent times the Open Source enablement and contributions made by NODE-Red in the IoT (Internet of Things) area, which was the subject of a prior blog item.

Conversely any ERP vendors who attempt to impose aggressive license terms and conditions that essentially prevent the enablement of a successful API / Microservices economy through the application of “indirect access” license terms and conditions will likely become increasingly isolated islands in time.

Which takes back in a full circle to the beginning of this blog, what does a “Post Modern ERP Application” look like in a world where the ability to Digitally innovate and successfully integrate traditional Systems of Record / ERP systems with innovative Systems of Innovation, Insight and Engagement becomes and critical “business survival and differentiating strategic IT capability”

PS A recent example of front office Business Process Optimization, Automation and Integration at Carlsberg can be found here. and the enclosed youtube video link.

Sources of further information that are referenced or were researched for this blog include:

Understanding there is a very broad and deep pool of information sources in this area, consequently my principle challenge for this Blog was what to leave out vs not what to include.

For example, I left out a pool of material on Client SOA / API maturity capability analysis and step wise development that was very interesting and critical for most clients, in addition to IBM’s Data First Method, whilst understanding Rome was not built in a day.

IBM’s API Connect Overview can be found here:


..and further technical details here:
IBM Redbook – Getting Started with IBM API Connect: Concepts and Architecture Guide


APIs for Dummies – Claus T Jenson


Plus, a recent demonstration of integrating simulated data from a back-office ERP system with Weather data to dynamically re-route deliveries to from ACME Co to Retail pharmacies and distributors leveraging “Strong Loop” capabilities:

The Evolution of the API Economy – IBM Institute of Business Value

IBM Redbook – Integration Throughout and Beyond the Enterprise


The prior Viessmann IBM White Paper re SAP and IBM SOA Solution Enablement


White Paper – IBM SOA Foundation: providing what you need to get started with SOA, 2005.


Wikipedia Entry re Microservices


Finally as an example IBM Watson IoT architectural point of view (pass the curser over the various ABB’s) in the landscape which combines integration and information building blocks.


The opinions within this blog are the authors, they do not represent a formal IBM corporate point of view, copyrights are respected and/or sources referenced.