SaaS – Page 5 – ITSinsider

Sweet Virginia

Thank you for your wine, California
Thank you for your sweet and bitter fruits

Mick and Keith might not be there, but you will be among friends. The kickoff conference for Web 2.0 for Business is definitely Dion Hinchcliffe’s New New Internet conference here on the East Coast in Tyson’s Corner, Virginia. He has assembled an A-list set of speakers in web 2.0 including Michael Arrington (TechCrunch). If you (customer or vendor) are on the East Coast. DO NOT miss this conference. A first-mover event; will make it into the history books.

“Oh! the Humanity!” Office [Space] 2.0

officespace,
originally uploaded by srm_nj.

To some degree, it’s pointless to comb the blogs of everyone who is on the same page and then reference them, but I couldn’t resist this post by JP Rangaswami.

Stalinists: Even though there is some doubt as to whether he actually ever said it, Stalin is often credited with saying that as long as people know there is an election, it’s not the people who vote that count, it’s the people who count the votes. A variation of this tends to operate in enterprises, where “power” is vested in the presentation-makers and minute-takers. What social software does is threaten this power.

Sadists: Learning to do things in an enterprise can be painful. Learning to do hard things can be very painful. I have worked in a company where, in order to save on stationery costs, they instituted a process whereby the “stationery cupboard” was only open on Tuesdays between 2pm and 4pm; if that wasn’t enough, no stationery could be ordered unless a form was filled in; and forms were only made available on Tuesday mornings between 10am and 10.30am. Learning how an organisation works is often like growing ear hair. There are no short cuts, it just takes a long time. And causes much suffering. What social software does is threaten to take away this familiar pain, leaving phantom limb sensations.

Stockholmers: Similar to hostages forming an attachment to their captor (despite the invidiousness of their position) there is an enterprise tendency to form deep-rooted and long-lasting relationships with lock-in vendors. This syndrome comes in two flavours: Temporary and Permanent. The Temporary one is less intense, fading when there is a change of management on the enterprise side. The Permanent version is a real feat of engineering, able to withstand multiple changes of management. Nobody gets fired for buying locks. What social software does is threaten to release the hostages from their secure jails.

Second-guessers: Any swarming or emergence effect needs to have a swarm in the first place. One place. With the plethora of options available in Web Too Many Oh, this creates a paradox of choice. Freedom’s just another word for nothing left to choose. Second-guessers can stultify attempts to derive value from social software, by fragmenting the enterprise base in time and space. Space because they ensure multiple options are taken up simultaneously guaranteeing there is no critical mass, no liquidity. Time because they engineer an enterprise change-of-horse-in-midstream, never actually allowing the liquidity to be acquired. What social software does is threaten to take away the freedom of the second-guessers.

Sewer-dwellers: The ploy here is to define the battleground for social software as infrastructure, as plumbing. Even though it shouldn’t be the case, most enterprise buyers treat infrastructure as overpriced, oversold and over. As soon as the argument shifts to sewerage, the enterprise immune system has no problem repelling all boarders. This is despite the fact that social software has minimal infrastructure costs. Why do sewer-dwellers do this? Because it’s their home. What social software does is threaten to take away where they live.

Silobites: These are people who live in silos. Their jobs are to ensure that as much stuff as possible is stored in the silo, the bigger the silo the better they feel. They are defined by the walls. What social software does is threaten to take down these walls, building small connectors between silos.

Look at the things threatened. Power. Familiarity. Security. Housing. Freedom. Enough said.

I loved this post! Yet interestingly, I see more “trash talk” and antidisestablishmentarianism in the SaaS ranks, where the objective is clearly to go direct to the users… the “Power to the People” crowd.

Office 2.0 in SF: It’s the “IT” (the hip word, not Information Technology) conference for the Fall

Office 2.0 conference,
originally uploaded by srm_nj.

I’m experimenting with flickr. Here is the button for the Office 2.0 conference. What’s neat about this conference is the grassroots effort that is behind its organizing, collaborating, and showcasing.

Let’s see what happens when I hit “post entry…”

Starship Enterprise 2.0: Cleared to Roam the Galaxy

Thank you Jerry Bowles, who thanked Andrew McAfee, and Ross Mayfield for his heroic efforts (adding props from me on behalf of all outsiders looking in)– the confederacy of brainiacs at Wikipedia have deemed Enterprise 2.0 worthy of definition and have not deleted it in its last dash, near-fatal round of scrutiny.

Others who should be commended for taking up the lightsaber* on pursuit of the revolutionary battle include: Vinnie Mirchandani, Ismael Ghalimi, Jeff Nolan, Dion Hinchcliffe, Jason Wood, Rod Boothby, Dave Tebbutt, and anyone else I missed who spent long hours debating what should be in/out of the definition.

*sorry, I know it’s bad form to mix trekkies and star wars fans, but remember, we’re fighting for freedom for all geeks and wannabe geeks. 🙂

The Rebirth of the SI Market: Anyone in the Mood for a Fat Margin?

I had a great briefing this week with IBM’s Dan Gisolfi of its Emerging Technology Group. I was able to clear up a few things. For starters, it’s not THAT easy to create a “long tail” micro situational app. Gisolfi says, “Today, it’s extremely hard unless you’re a programmer… and unless you know Ajax, Java script, and programming languages, you’re not going to create a mash-up.” But that’s where this IBM group is headed. With their web 2.0 class of tools– mash-up makers– ultimately, the high IQ guys and gals in IBM’s key installed base accounts will be able to create their own dashboards ad hoc and provision data across departments and groups without troubling anyone from IT at all.

Gisolfi and I waxed philosophically about the cultural trends that are driving Enterprise 2.0 and we agreed about the socio-cultural underpinnings. Now here is a guy who can fit squarely in both camps– traditional IT, wearing the IBM logo, yet can hold a respectable conversation on the latest in open source, or any web 2.0 technology. We agreed the new Enterprise 2.0 wave is not about technology. The technology is evolutionary and Gisolfi recounted many examples of initiatives IBM has been involved in for years that are now hyped as web 2.0. What’s different now, however, are the attitudes that eclipse the technology. He said, “Web 2.0 is a convergence of enablers… coming together at the right time, at the same time.”

We then talked about a possible rebirth of the systems integration industry– something I found intriguing. Gisolfi said, “For the IT guys, we’re not taking away work, we’re creating a new type of work. Instead of doing integration of monolithic applications, today, you’re going to create granular software components.” He used Sarbanes-Oxley as the perfect example of the need for a customized, daily mashboard. He described using a business analyst or consultant to define the data indicators and then pass it to a software guru to render it and provision it as a mashboard.

It’s at this point, I started thinking about the sweet-margin business of the late 80s: systems integration. I checked in with Graham Kemp, who tracked the SI market in those days. Graham said, “In the late 80s, SI margins were good… in the high teens… and FM (facilities management [outsourcing]) margins were fair (low teens). As the 90s came in, both dropped.”

On EDS’ Next Big Thing blog a few days ago, I read with some interest a post resurrecting the “I” word:

For a long time, the Fellows have been talking about the movement away from the Chief Information Officer to the Chief Integration Officer. The integration of process and information flow between and across the enterprise to enable greater flexibility is where all organizations need to be headed.

And as I just wrote recently to the head of analyst relations at CSC, before all outsourcers were called outsourcers, they were systems integrators. It might be time to ditch the losing battle in the ITO market, and start putting up recruiting booths on MySpace. There may be high margin opportunity introducing the Global 2000 to Enterprise 2.0.

Seismic Shifts in the Software Industry

I listened in today on NetSuite’s hosted Enterprise 2.0 and the Software Industry webinar featuring SandHill.com’s M.R. Rangaswami. I was amazed by some of the statistics in the presentation, but remember, I’m new to some of this stuff by five years. For instance, M.R. said Sandhill had done some research and is reporting that 90% of all software firms are now using offshoring for some element of their development. I also was surprised to hear that 80% of a CIO’s IT budget is already committed to maintenance before the year even begins… the point being a mere 20% is left for innovation. He also said Sandhill had counted over 500 Web 2.0 companies, but was quick to point out that, “None of these companies know how to make money.”

NetSuite, a SaaS app, and whose product looked very impressive, btw, said the webinar would be available on their site.

This issue about the IT budget is one where I’m not sure everyone is on the same Enterprise 2.0 page. A few days ago I was pestering poor, old Gary Fernandes (who is really neither) about this point. Gary used to trot out this slide back in the old days while I was covering EDS. It showed how, on average, the IT budget was a mere 10% of the operating budget of most corporations. As Gary was EDS’ Chairman of A.T. Kearney, and the BPO market was just beginning in those days, he was always interested in how EDS could get its hands on the other 90%. Enterprise 2.0 is Gary’s dream come true. The big opportunity here for tech companies is not with the IT budget gestapo, it’s selling directly to the lines of business that can produce real returns on small investments.

I tried to make this point to Vinnie Mirchandani today, who knows better. I know there will be a lot of push back on this issue. And, I’m a lover, not a fighter, but hey– it is a revolution whether you’re the revolutionary type or not.