Earlier in the week, I pointed to some Microsoft material from last year that talked about “the partner opportunity” with SharePoint. The key point from Microsoft, is that for every $1 an organizations pays Microsoft for SharePoint licensing, they pay business partners “$6 to $9 on services.”
I’ve been thinking more about this over the past couple of days, and in particular, what the phrase “platform” actually means to organizations making a decision to invest in SharePoint.
Here’s my current thinking – your feedback welcome.
Look at the slide above. It’s a Microsoft slide, and is aimed at business partners. It includes this line in the middle of the slide: “Out of the box functionality accelerates time to value, time to close.” What does “functionality” actually mean in this context, if firms must then spend $6-$9 on services?
Now add the Microsoft positioning of SharePoint as a “platform,” not a product. Does a person – an administrator or end user – actually use a “platform,” or do they use a “product”?
Think about what comes out-of-the-box in SharePoint, and how usable it is. Roughly speaking:
- Team collaboration functionality … Team sites and the group work site – they are basic, and often require mitigation by third-party add-ons. Eg., CorasWorks for aggregation and summarization, Colligo Contributor for offline (SharePoint Workspace 2010 is a forward step, but Colligo is still better).
- Communities and Social Networking functionality … My Site (newsfeed, content, profile) in SharePoint 2010 is a big improvement over SharePoint 2007, but still has large usability issues. To make it work, firms need to do development, or buy NewsGator Social Sites.
- Content functionality … For Web content management, document management, and records management. Again, it’s better in SharePoint 2010, but lacks some things. Eg., email integration between Outlook and SharePoint for dragging-and-dropping email messages and attachments into a SharePoint document library, and records management that works.
- Workflow functionality … Firms often need to buy Nintex Workflow or K2 to make workflow usable.
- Administration functionality … It’s not my area, but clients tell me they need more to make it usable – via AvePoint or Quest, to name but two.
So … in the SharePoint world, a platform gives functionality that ISVs build products on top of, and those add-on products are required to make SharePoint usable. Thus the SharePoint decision by implication involves a commitment to both buying the platform and a suite of add-on products, in order to make it work.
Here’s my slide, as a way of explaining it:
After making the decision to buy platform+products, the firm has a collection of products from multiple vendors, built on a common platform from a single vendor. This means that a “SharePoint installation” is complex not just because SharePoint as a base platform is complex, but because the raft of add-on products makes upgrade and migration complex, means that look-and-feel and interaction modes between different products is different and thus complex, and there are multiple vendor relationships to maintain over time.
As a result, SharePoint is not about a single thing from a single vendor.
Hence the $1 : $6-$9 figure above.
Does this make sense?
Categories: Microsoft SharePoint, Tools & Technologies
This makes total sense. The other point to make is about the $6 a $9 dollar figure. It is misleading, because most Consulting and Partner firms are left competing at much lower hourly rates for Sharepoint professional services. This makes it hard to justify going after the space because of lower margins and a market perception that Sharepoint is easy to configure and rollout COTS solutions. To make it really work and to solve business integration and provide automation needs you will have to do a lot of customizations. To close a services engagement with the right expectations the Partner has to do a lot of costly presales work to undo this mindset with a customer. This only drives a partners total revenue opportunity lower.
Thanks Shadrach – good to hear your perspective on this, and the difficulties around justifying work.
We use SharePoint as a “platform” here at University of Auckland. Apart from the standard OFB and couple of third party products, we also build custom solutions to meet the user requirements. And (un)fortunatley, because SharePoint is so powerful/flexible – there are a lots of “opportunities” for customisation and extension too.
I believe the cost is going to be exponential – not just an additional levy – we already have started talking about the “cost” of upgrade to SharePoint 201x!
Thanks Ken – good to hear your experiences and current thinking.
Thanks for publishing your ideas… I read many of your articles, as you highlight some of the key aspects of achieving improved business results using SharePoint.
I have been working through some of the SharePoint “platform” questions recently and thought it may be useful to post my observations.
The key point of a platform based approach is that
many different – business applications – each covering specific business needs, can be delivered using
a single, shared platform – that both
is highly scalable
provides a rich set of re-usable, business solution components
The potential business benefits of a platform based approach – for an organization – as opposed to considering a single business application – are
savings in costs and time – for development and support
compared with developing & supporting each business application on a different platform
The SharePoint platform – scalability story (mainly about hardware)…
Adding more users or more business applications
increases the level of demand on the shared platform for its services
Adding more servers
increases the shared platform capacity to supply its services
So “simply” add more servers to the SharePoint farm to ensure supply = demand.
The SharePoint platform – re-usable, business solution components story (mainly about software)…
Note that, for a SharePoint-based business application
each specific business application can “simply” be scaled-up on
each new business application can “simply” be added to and integrated with other business applications on
the same, scalable, shared platform – the SharePoint farm.
This significantly limits the overall complexity of the environments need to run the full set of business applications. This is a key benefit of the SharePoint platform based approach.
Moving on to the software itself…
The SharePoint platform, as supplied by Microsoft, provides
an overall software architecture and
a rich set of re-usable, business solution components
as shown in the diagram in your original note.
What this means is that you and any suppliers of “add-on products”
save time/money – by not having to develop these solution components from scratch
gain some assurance that these solution components should work well together (as integrated components)
So regarding the line in the middle of the Microsoft slide:
“Out of the box functionality accelerates time to value, time to close.”
I think this still applies – even if using “add-on products”.
Imagine if each supplier of an “add-on product” implemented their own equivalent of lists / libraries, permissions and databases used for storage. Given multiple suppliers, that would be an integration nightmare.
So, there is real value – for customers, “add-on” suppliers and of course for Microsoft, arising from the use of the SharePoint platform.
On the platform vs product question – I think that many of the “add-on” suppliers or in-house developers provide both
SharePoint – application software – platform extensions
as more, general purpose capabilities on the platform
used by people who know about SharePoint coding or customization
to build “almost complete” business solutions, for specific types of business application
“almost complete” business solutions
used by business end-users to create the instance of that solution that will be their specific business application
If an out-of-the-box, SharePoint site template provides an “almost complete” business solution then
the SharePoint – application software – platform – is just SharePoint OOTB
So depending on
what the business needs by way of “almost complete” business solutions
the general capabilities required to deliver these “almost complete” business solutions
you have a number of make-buy decisions that determine your SharePoint – application software – platform.
As you have made clear – this does get quite complex. This is mainly because it is inherently complex.
As well as considering functional aspects, there is always a need for somebody to maintain overall shared platform design control covering both
the capacity to supply services – of the infrastructure / hardware in the farm and
the level of demand for services – from the deployed SharePoint – application software – components
I think that the additional costs of making SharePoint OOTB work for a specific organization will add up to a bit more than the $6-$9 figure.
I also think that implementing an equivalent set of business applications, using many different platforms would add up to a $600-$900 figure.
So overall quite a saving – if you understand how to manage your SharePoint platform !
Very good answer James – with compelling arguments. Good work – thanks.