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CODA 2go hosted financials ready for integration with Salesforce.com
CODA has entered the on demand applications market with the release of CODA 2Go, an implementation of its financials system that piggybacks on the success of market-leading software as a service firm Salesforce.com. CODA CEO Jeremy Roche discusses the implications with Stuart Lauchlan, news and analysis editor for MyCustomer.com.The US on demand sales force automation champion came to London last week for the first UK Dreamforce customer and developer conference at the Barbican Centre. The event was attended by 2,200 customers and partners of Salesforce.com and was the first time that the event has been hosted outside of Salesforce.com's home city of San Francisco. The relationship between Salesforce.com and Coda was announced at the last global event Salesforce in 2007, so it was perhaps appropriate that the London event should see the first deliverables.
CODA 2Go offers a full-scale accounting software system available through the Force.com, platform-as-a-service (PaaS) model running on Salesforce.com. Force.com is Salesforce.com's attempt to pitch its business as a platform on which other domain experts can develop their own products, tightly integrated to the main Salesforce.com offering.
The first release will cover opportunity-to-cash processes with general ledger accounting, purchase-to-pay and sales order processing functionality and will be available over the coming months. The software allows users to pay a monthly charge with no contracts; only one month's notice of termination is required. To use the full set of CODA 2go modules will cost between £65 and £75 per user per month.
"We announced this native build in Force.com last October,” CODA CEO Jeremy Roche told AccountingWEB. “We started by looking at alternative routes. I had set my team a challenge to do for accounting what Salesforce.com had done for CRM. The team said that they would need two years to build a multi-tenant engine and that we'd need to go to buy lots of infrastructure on which to develop. Now, we're not an infrastructure company so we had the idea of borrowing some of Salesforce.com's infrastructure.
"This has been a learning exercise for us. At Dreamforce, [Salesforce.com CEO Marc] Benioff asked the audience how many people would ask for on demand accounting and ERP. The show of hands he got was even more than I had expected. It will open up new markets to us, there's a whole untapped market for on demand accounting software. On demand is becoming a much more acceptable and appreciated way to deliver and consume software and the good thing is there is no market leader in the accounting space."
But is there really the demand? After all, every company needs accounting systems and most probably have them in-house already. "Well, let's say that companies replace their accounting systems every 10 years, that's 10% of all companies replacing their systems this year. That's not a market I can necessarily get into with a traditional delivery model," Roche answered.
Roche concedes, however, that there will need to be a leap of faith for users to take up this emerging technology. "Finance directors do tend to be cautious individuals,” he admitted. “But there are a couple of things changing. People who have already used Salesforce.com know how secure it is and how much back-up you get. Also the next breed of financial director will come through who grew up with Facebook, and GoogleApps and so on. Over time, start-up companies in particular will entrust accounting systems to the Cloud. There will still be people who are using Excel, but more and more will look to on demand.”
Not everyone is impressed. NetSuite, a rival to both Salesforce.com and CODA, was particularly scathing. "This sounds like what Salesforce.com announced but never shipped in their Salesforce.com Billing edition - a weakly integrated order management system," said Craig Sullivan, vice president of international products at Netsuite. "There's a reason they didn't even bring it to market - they realised no one has a use for a partial ERP system. Besides being an application of limited utility, the CODA effort also points to an often overlooked problem with Force.com - just because applications are built on the platform doesn't mean they actually work together. In this case you have to buy a third-party integration tool for customer integration. It's as hard to tie together Force.com apps as it is to tie Salesforce.com to SAP."
Roche was having none of this. "Out approach is different,” he insisted. "As an organisation, we have 30 years of history of building accounting systems and I'd challenge NetSuite to be able to say the same thing. We've poured our domain expertise into this. Also, we are not integrated with Salesforce.com, we are part of it. We are hosted in the same place, we use the same database and so on."
Salesforce.com's Benioff is critical of traditional, on premises software firms such as SAP or Microsoft trying to move to the Cloud, arguing that their business models cannot support such a move. Doesn't that also apply to CODA? "There are a couple of things that make it different for us," suggested Roche. "If we had decided to build a SaaS business and build a multi-tenant platform ourselves then it would have been too painful for us to make the change. What changes it for us is the relationship with Salesforce.com. They have made that whole multi-tenant platform available to us. We have access to their 10 years of knowledge. I do have some of the same challenges as other on premises vendors, but I am using Salesforce.com as my model so I don't make the same mistakes as others. The sort of customers that I am talking to I could never have done on my own."
CODA will continue to develop and support its own on premise offerings as well, so did Roche buy into Benioff's rhetoric that software as we know it is dead and everything is now heading to the Cloud? “It will take many years, it may never happen that everyone moves to the Cloud," Roche answered.
"But there is a trend that way. I will normally sign a certain number of new customers each year; looking at the demand for this, I could be looking at many, many more. The Cloud model is all about building compelling applications because the business is all about renewal rates and that makes the customer and customer satisfaction the long-term objective. That's been my ethos for on premises anyway. I have first mover advantage here now. Salesforce.com could sign up other people, but they would have to catch up with me. I fully expect to have competition because if I can see this is a good idea, then others will as well."
Number of comments: 5
AccountingWEB.co.uk 13-May-2008
Categories: IT Features, Software
Times read: 2507
Arguably a better platform - see http://www.devx.com/MicrosoftISV/Article/38171
Quote '.. And now Microsoft Dynamics CRM 4.0 is poised to knock your socks off. Before you decide to let the force guide you, take a few moments to learn about why Microsoft Dynamics CRM 4.0 is ready to turn the world of CRM development upside down ..'
One hopes the right choice of platform has been made!!
Interesting response (or lack of it) concerning the 'fall back' position if the association with Salesforce should break down
Perhaps someone in CODA would care to let us know the strategic recovery scenario with this product if they part company with Salesforce
Or to put it simply - what happens to the customer if CODA & Salesforce fall out?
Frankly if the best the CODA Group Marketing Director can come up with is sarcasm, as in the response below, then your PR has gone a bit wrong.
Nevertheless, however one chooses to dress it up with marketing speak there is no getting away from the facts:
- missed the boat with SaaS & now not wanting to be left behind
- trying to play catch up with quick wins
- recognising the considerable resources & costs required to achieve an internet solution. A ground up redesign and not simply porting an existing app
- accordingly looking for shortcuts on both fronts and reduced costs/lead time is a very appealing driver
It is a pity that as a '.. global software company that's been around for nearly 30 years ..' you have spent the last 10 of them failing to recognise the merits of SaaS
As for '.. mis-reading the market ..', how does this stack up with CODA's performance over SaaS?
The real question is
If CODA falls out with Salesforce do you still have a product or is the platform so proprietry that you need to start again?
This is important issue concerning future customer concern (continuity). Since these matters have already been addressed by CODA perhaps you would care to share your findings with us so that everyone is aware of your 'fall back' position & can gain comfort from your contingency plans
Clearly as a global software company that's been around for nearly 30 years, we never considered any of that, JC. So many thanks for your advice.
It's always nice to see our competitors misunderstanding what we're doing, and mis-reading the market. Makes us feel like we're going in the right direction!
A brave move to take this approach & sacrifice control for delivery speed. Hopefully a very watertight agreement exists and how do they reverse out of the partnership if things go wrong?
- Salesforce have their existing products to support which may take precedence over other peoples. This was originally a spin-off which allowed their own users to customise their applications
- it is a proprietary platform and once on it you are the mercy of Salesforce. If a dispute arises can you just 'up sticks' and go elsewhere - and if different levels of service/support are imposed or prices raised you would be in real trouble with no means of arbitration
- In fairness, Salesforce case against 'lock in' is that their APEX invokes the same code as their SOAP API so you could bypass the language; provided the status quo remains with no takeovers etc
- re-badged from earlier attempts and one has to wonder why this was necessary (apart from the excellent name 'force') if the original concept was such a winner. The comment '...We need to communicate (with customers) at a high level still that we have an applications strategy, Mr Benioff said...' is a fairly damning recognition of their own perception of their position
- charging monthly royalties which by their very nature exclude certain types of application. In any event all the 'benefits' come at a price which may be too high to pay and inevitably the higher costs get passed onto the user
- with this type of platform Salesforce has ability to change the rules very quickly and suddenly you may have no business
The balance of power seems to be very one sided and although Salesforce probably would not do anything to alienate their partners things change in the future
Maybe it's the next great thing or maybe all hype.
Perhaps CODA should regard their apps on this platform as 'throw away' because that may be what it comes to in the longer term
