September 24th, 2009

Why you should be glad about Gmail failures

Posted by Phil Wainewright @ 10:57 am

Categories: Collaboration, Customer experience, Google, Service level management, Uncategorized

Tags: Google Gmail, Router, E-mail Providers, Cloud Computing, Internet, Phil Wainewright

Gmail is having problems again today and some users are squirming while others aren’t worried.

Of course it’s a hassle when Gmail’s not there any more — I found my work rhythm was interrupted and instead of writing and sending some emails as I’d planned, I had to switch to another task and they’re still sitting on my to-do list now. But the way I look at it, every Gmail outage is a small investment I’m willing to make towards a future when I’ll be able to take its reliability utterly for granted.

With every Gmail fail, Google learns more about operating a cloud-scale, enterprise-class email infrastructure. While it may be true that Hotmail and Yahoo! Mail have more registered users and traffic, neither of them are trying to attract enterprise customers as Google is with its Google Apps suite (of which Gmail is the flagship application). That means no one has ever attempted what Gmail is now doing, and with each slip-up along the way, it learns how to do it better.

Remember the big outage that affected the Gmail web interface on the 1st of this month? Read the rest of this entry »

September 23rd, 2009

SaaS for your business in the cloud

Posted by Phil Wainewright @ 10:43 am

Categories: ERP, NetSuite, Uncategorized

Tags: Software-as-a-service, NetSuite Inc., Zach Nelson, Software As A Service (SaaS), Managed Hosting, Cloud Computing, Emerging Technologies, Phil Wainewright

Not to be smug, but SaaS is a great place to be in the software industry these days. I was talking to salespeople for several SaaS vendors and partners at a customer event a few weeks ago and there was a palpable sense of relief that they’d moved out of on-premise sales — one described to me a recent joiner’s event at his current employer where a dozen or so former Oracle high-fliers were coming on board. “These guys know all about following the money,” he commented.

Today, I’m at a NetSuite customer event in London and CEO Zach Nelson has just displayed a chart quoting IDC and Gartner data that shows on-demand ERP sales are growing at a rate four times faster than on-premise. OK, that’s from a lower base, but remember too that SaaS vendors book far less each year from each individual deal than their on-premise rivals, which makes their faster revenue growth even more impressive.

So I’m wondering, what’s driving this remarkable growth? Conventional wisdom says that it’s just lower upfront cost and faster time-to-live that’s driving businesses to adopt SaaS, especially in these straightened, cost-conscious times. But there’s another factor that I think is underrated and I’m interested to hear Nelson emphasize it in his presentation.

“So you’re going to build your business on software that was designed before the Internet existed?” he relates asking a customer in a recent sales call. Increasingly today, business is done in the cloud — with customers, suppliers, employees — and Nelson’s message is that, to participate fully in that medium, business systems have to be in the cloud, too. “Your company is in the cloud,” his presentation concludes.

The message is reinforced by Peter Bauer, CEO of Mimecast, which adopted NetSuite to manage its growth providing email management services as a multinational business. “You have to increasingly think of customers visiting your organization as an online experience,” he said, speaking on a customer panel at the event.

Perhaps more SaaS vendors should take a leaf out of NetSuite’s book. Instead of going on about the lower cost and faster time-to-live of their solutions compared to conventional software, they should just point out that operating in the cloud is how business is done these days, and anyone whose business systems operate anywhere else is going to get left behind. It’s as simple as that.

September 22nd, 2009

Is keeping big media alive good for the future of journalism?

Posted by Phil Wainewright @ 7:56 am

Categories: Business models, Web 2.0

Tags: Web, Journalism, Media, Advertising & Promotion, Channel Management, Marketing, Phil Wainewright

The spectacle of various media tycoons over the summer proclaiming that paywalls are coming back for news content has felt like watching a car crash in slow motion. I suppose if you’re a news publishing executive you have a vested interest in blaming the Web for killing print media, but frankly I think it’s time to put a stop to the bluster. It’s not the Web that killed their businesses, it was the media owners’ own callous lust for profit during the boom years when making money was easy and good journalism was too hard to cost-justify (especially if you left morals and integrity out of the equation).

So while I applaud the latest initiative by subscription billing start-up Zuora to save journalism, I don’t believe that saving big media is the way to do it — even though Zuora’s platform, in other hands, may play a key role.

Many people are worried that the tradition of fearless, relentless investigative journalism that is one of the guarantors of our democratic freedoms is under threat from the financial bankruptcy of big media and its consequent inability to fund such initiatives. But it was the industry’s moral bankruptcy that killed off investigative journalism and replaced it with mindless reproduction of press releases and spin — all the while diminishing reader loyalty and respect. Good journalism costs money and (like prudent banking) it became a casualty of short-term greed, with the Web coming along just in time to pick up the mantle of convenient scapegoat.

Casting around for solutions, some people feel that investigative journalism in the online era should be Read the rest of this entry »

September 21st, 2009

Computing by the people, for the people

Posted by Phil Wainewright @ 3:08 pm

Categories: CRM, Collaboration, HRM, Platform as a service, Social computing, Web 2.0

Tags: Social Software, Computing, People Management, Phil Wainewright

Sometimes you’re too close to the wood to see the forest. Across several different sectors of computing, participants are talking about a trend to add social, collaborative or self-service features to certain application categories. Perhaps it’s now time to join the dots. As I wrote last week, these are all facets of a broad trend across computing towards the democratization of IT — the people that actually use computing, as opposed to those that make or manage it, are taking control.

For those who haven’t seen it yet, here’s a roll-call of the different categories of business computing where this is in evidence.

Social CRM is the term for a new trend in customer relationship management software that acknowledges (in Paul Greenberg’s words) “the customer’s ownership of the conversation.”

Enterprise 2.0 is (in Andrew McAfee’s words) “the use of emergent social software platforms within companies, or between companies and their partners or customers” to allow user-driven sharing of knowledge and information.

People management is another application category where social computing and user participation is creeping into various aspects of HR and talent management, from social recruiting to performance management.

Ad hoc customization is becoming a staple offering in SaaS applications and is an integral component of platform as a service. Meanwhile, cloud computing is making compute power available on demand to anyone who needs it.

What have I missed out? Add your examples in Talkback below.

September 18th, 2009

The democratization of IT

Posted by Phil Wainewright @ 6:54 am

Categories: Business applications, Social computing, Web 2.0

Tags: Web, Information Technology, Service-now, Web 2.0, Service Level Management, Channel Management, It Services, Strategy, Internet, It Operations

Earlier this week I attended the EMEA user conference of Service-Now.com, probably the leading SaaS pureplay vendor in enterprise IT service management. Co-founded by former Peregrine Systems and Remedy CTO Fred Luddy, Service-now champions a Web 2.0 approach to systems management, an approach that’s often described as the consumerization of IT. But watching Luddy’s opening presentation, it struck me the term is a misnomer.

‘Consumerization’ is the trend of making unwieldy and complex enterprise software as easy to use as the applications and services ordinary people use on the Web. We dress it up in a long word that implies the industry is doing its customers a favor, but what’s so special about making software people can actually use? Isn’t that what the industry should have been doing all along?

Furthermore, I don’t think the word consumerization is an adequate description of what’s really going on here. It’s a mass media term, which makes it sound as though the IT department has bowed to popular demand and started beaming crowd-pleasing, populist software out to users’ desktops in place of the challenging, highbrow applications it used to offer. The unspoken undertone of the analogy is that the users are dumb couch-potatoes that have to be cajoled and tricked into engaging with their work.

But passive consumption is the last thing Web 2.0 is about. If the media barons of Web 1.0 had had their way, users would have sat in their walled gardens and meekly consumed whatever Yahoo, AOL and the rest saw fit to distribute. Instead, users seized control, told each other what they thought of online content and started generating their own blogs, videos and commentary. Web 2.0 was a grassroots revolution, not consumerization but democratization, and that is the trend that is now transforming IT.

In IT service management (ITSM), which is the market Service-now addresses, that process of democratization has meant giving users the tools to find their own answers to problems instead of leaving them dependent on the availability of a limited pool of IT experts. This is a concept that’s Read the rest of this entry »

September 16th, 2009

Adobe ties web design to business results

Posted by Phil Wainewright @ 6:03 am

Categories: Adobe, Content management, Omniture, Web 2.0

Tags: Adobe Systems Inc., Web, Software-as-a-service, Omniture Inc., Web Site, Web Design, Software As A Service (SaaS), Managed Hosting, Cloud Computing, Web Site Development

The more I think about Adobe’s decision to acquire Omniture for a mouthwatering $1.8 billion (Techmeme coverage), the more it feels like a smart move (though I know others are wondering how the deal makes sense). The growth of SaaS and cloud services gives Adobe a looming problem, which depends for its revenues on sales of conventionally licensed software, most of it to the creative people who design corporate websites. Even if those users turn out to be the last people on earth to switch their allegiance to cloud-based applications (as well they might), they’re still going to slow their spending on licensed alternatives in the meantime. Adobe needs a way to tap into the faster growth that’s available from online solutions, and Omniture, which I once named one of The four horsemen of SaaS, will help it jump on the gas.

By the way, some financial analysts are saying Adobe overpaid because competition from the free-of-charge Google Analytics service is already putting Omniture’s revenues under pressure. I don’t think the analysts who are saying that really understand much about business. Omniture’s core customer base are enterprises that spend huge amounts of money on web marketing and their online presence, and who want to measure the effectiveness of and return on that spending. They’re going to rely on a free-of-charge service for such a critical business process? One that’s provided by the same company that accounts for a large proportion of their online ad spend? Puh-leeze!

But back to why Adobe made this move now. Its existing strategy, which I described last year in a post on SAP, Adobe, Microsoft: three monkeys take on SaaS, has been to develop a new line of collaborative applications that compete on Microsoft’s turf rather than cannibalizing its own licensed revenue stream. That strategy continues, but it’s inevitably taking a while to build it out. Hence the decision to open a new front in the company’s transition into online services.

Omniture makes a superb fit for reasons Read the rest of this entry »

September 14th, 2009

Sage dresses SoSaaS in cloud clothing

Posted by Phil Wainewright @ 2:53 pm

Categories: CRM, SFA, Utility computing

Tags: Software, Software-as-a-service, Software As A Service (SaaS), Cloud Computing, Managed Hosting, Virtualization, Emerging Technologies, Hardware, Phil Wainewright

The software industry’s equivalent of ‘mutton dressed as lamb‘ is a phenomenon I tagged in the early days of this blog as SoSaaS: Same old Software, as a Service (SoSaaS). This is when established software vendors “take any old software package, run it up on a server in a data center, do a bit of financial engineering so customers can pay on a monthly plan, and hey presto!” They imagine they’ve introduced a competitive SaaS offering, but all they’ve really done is demonstrate their complete failure to understand what SaaS and cloud computing is all about.

Rather than fading away, this kind of self-delusion has been given a second wind by the advent of cloud computing, and is now more prevalent than ever. People seem to imagine that implementing a conventional software package on Amazon EC2 or some other cloud platform magically transforms it into a state-of-the-art SaaS stack. I’m afraid not.

Unfortunately, some vendors are so backwards in their comprehension of the SaaS model, they actually believe there’s some advantage for customers in perpetuating the long-winded implementations, painful upgrade paths and orphaned customizations of conventionally licensed packaged software. Here’s Sage CRM chief Joe Bergera talking up his company’s announcement today that “it is piloting a cloud computing edition of the Sage SalesLogix CRM suite for commercial availability in early 2010.” He enthuses:

“While first generation Software-as-a-Service generated a lot of interest, people will look back on this era as a period of big-iron, centralized operations that restrict the ability to customize the solutions … The next wave of Cloud Computing will benefit customers by providing a highly distributed and flexible deployment model that shifts control of the service to their favor, rather than SaaS vendors, so they can better tailor their CRM experience in a way that optimally suits their business.”

The press release goes on to reveal that what he is actually describing is nothing more than a “full-featured, single-tenant cloud edition of Sage SalesLogix using Amazon’s EC2.” Yes, this revolutionary new proposition is just a sorry pile of SoSaaS, dumped in the cloud. Go figure.

September 12th, 2009

Finally, technology is about people

Posted by Phil Wainewright @ 2:55 pm

Categories: HRM, Social computing, SuccessFactors, Web 3.0

Tags: SuccessFactors Inc., Performance Management, Tools & Techniques, Business Intelligence, Pricing, Workforce Management, Human Resources, Management, Enterprise Software, Software

Listening to SuccessFactors this week outline its new positioning as a provider of ‘business execution software,’ I couldn’t help being reminded of the early days of what were then called executive information systems. As early as the late 1980s, enterprises started spending large sums of money on complex software whose role was simply to collect information about what was going on in the business and deliver it to top management.

Thirty years later, we’ve finally reached a point where such systems can be democratized, and instead of that information being expensively collated for the benefit of a privileged handful of top executives, SuccessFactors promises to give everyone in the organization the information they need to help them track whether they — and the teams they belong to — are achieving their goals. Perhaps the product should be called a ‘talent information system’.

It’s a characteristically aggressive strategy from SuccessFactors, which aims to thrust it out of the narrower performance management segment and grab leadership of what could be a powerful new category of software. Of course, others may argue that this is just another variety of business intelligence, already a highly competitive field. But the genius of what SuccessFactors has done is to link business metrics to performance goals, putting the business intelligence into the visceral context of, ‘Am I likely to get a raise/make my bonus/keep my job this year?’

What struck me as I thought this through was that here was yet another take on a theme that seems increasingly prevalent in the briefings and stories I’m hearing this year, on the parallel beats of SaaS, cloud and enterprise 2.0. For a long time, technology has been about eliminating the human element — automating processes and systems to avoid human error, and delivering dispassionate analysis of transactions and outcomes so that management can take objective decisions. Now the pendulum is starting to swing back towards acknowledging the qualitative role that human beings play in processes and operations. The technology is no longer trying to keep them out of the equation. Instead, its role is to provide automation that helps them do a better job of collaborating with each other, focusing their motivation and acknowledging the experience, insight and creativity they bring to their roles.

I know that people sometimes feel diffident about embracing the new trends towards social computing, especially in the stuffy old enterprise. The message I want to keep on promoting is that we have now reached a point with Web technologies where we can, finally, use them to put people instead of machines at the center of what we do — and that is the natural order.

September 10th, 2009

Survival of the fit-most

Posted by Phil Wainewright @ 2:18 am

Categories: Ecosystems, On-demand, Platform as a service, Utility computing, Web 3.0

Tags: Web, Survival, Cloud, Cloud Computing, Channel Management, Virtualization, Marketing, Hardware, Phil Wainewright

In the emerging Web era, connectedness reigns supreme. Competitive survival is no longer the preserve solely of the strong, the quick and the nimble — the attributes popularly associated with Darwin’s adopted motto, survival of the fittest. The Web emphasizes connections, sharing and community, enabling a further advance in the evolution of homo sapiens as a social creature.

In this environment, the individuals, tools and organizations best adapted to thrive are those best able to connect. Not the fittest so much as the fit-most.

This change may seem to be the consequence of technology innovation — in this case, the Web — having an impact on society. But perhaps the rise of the Web is itself a reflection of a change that was already taking shape, a reaction against the individualist creed that culminated in the 1980s notion that ‘Greed is good.’ Today we see a generational shift towards shared endeavor and a backlash against excessive intellectual property protection.

A fresh example of this emerging collaborative mindset came last week when online backup vendor Backblaze published the specifications it uses to build low-cost storage devices for its data center. Ten years ago, this would have seemed a crazy revelation of a proprietary secret. Today, it looks like a smart move because we have a better understanding of the notion of crowd-sourcing. We realize that Backblaze aims to tap the collaborative expertise of the Web community to hone and refine the savings it can make on its physical storage costs. It’s a rational decision because the company isn’t giving away the operational details of its core service offering — it may even strengthen its selling power by publicly demonstrating the viability of its prices compared to such low capital spending costs (”three-tenths of one penny per gigabyte per month over the course of three years”).

Yet making the most of the doctrine of the fit-most means overturning long-held instincts to act privately and secretly, and instead making a conscious effort to share and use communal assets, whether as providers or consumers. The pressure to conform to deeply ingrained behaviors and customs is hard to resist (Zoho recently became the latest in a long line of SaaS and cloud providers to cave in to the clamor for a ‘private cloud’ option). We know why we want to keep things private — the arguments are well-rehearsed and almost a universal folk memory — whereas the impulse to share is much less well documented and understood.

Sharing and community are nevertheless at the heart of our success as a species, and ’survival of the fit-most’ is all about replicating that success in the cloud computing environment. Instead of trying to do everything alone as a hermetically sealed entity, the cloud encourages us to reach out and utilize the services of others that do what they do better than we can do it ourselves — which is exactly how human civilization works. We are all individually stronger and more potent when we rely on each other.

In cloud computing, survival of the fit-most emphasizes attributes such as: Read the rest of this entry »