
Is Enterprise Software Failing The Innovation Test? - luccastera
http://future.gigaom.com/2007/09/05/is-enterprise-software-failing-the-innovation-test/
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joshwa
This may just be my recent experience talking, but I think the problem in
corporate IT is an excess of formalism.. or Religion. You have the "Enterprise
Architects" running around thinking that if you abstract everything away, that
someone will be able to grok the whole process and eliminate redundancies and
magically you'll have a better organization. Then you have the Agile people,
and the Six Sigma people, and the RUP people, and the IT Governance Nazis...

Add to that the typical corporate risk aversion, and the "nobody ever got
fired for yet another kick-off for a new initiative with a Three Letter
Acronym," and what you end up with is vast overspending to deliver very little
value.

Naturally, this kind of bullshit is a huge disincentive to innovation. If you
actually had a good idea, there are so many obstacles to trying it and getting
things done that the smart people end up grinded down and flee for greener
more flexible pastures. This not just for the average developer who has an
idea-- it goes all the way up to the C-suite.

For corporate America to fix this, you need CTOs and CEOs who are willing to
be ruthless about paring down ridiculous initiatives and barriers to getting
things done. Radically simplified IT governance, along with a genuine attitude
shift towards accepting non-zero risk, is what will enable corporate IT
innovation.

~~~
bsaunder
"what you end up with is vast overspending to deliver very little value"

I agree completely, fortunately (or maybe unfortunately depending on your
view), this waste employees lots of people who want just a "job and a paycheck
please". I think in the coming year or two, there will be an awakening here.
Agile Web 2.0 stuff will start to show business users the things they can do
when "Enterprise Architects" get out of the way.

"Naturally, this kind of bullshit is a huge disincentive to innovation. If you
actually had a good idea, there are so many obstacles to trying it and getting
things done that the smart people end up grinded down and flee for greener
more flexible pastures. "

No kidding. I learned my lesson on this over the last two years.

I actually think the change will come from the business users. There will be
profoundly cheaper alternatives to traditional Enterprise applications in the
coming years. I don't have faith in CEOs and CTOs to see this coming.

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jdvolz
I liked this part the best:

"Some of my banking customers have infrastructures that are bigger than the
public Internet in terms of the storage they consume, given all the data and
equipment they have to support."

Somehow, I doubt that anyone has a system larger than the public internet
particularly as measured by storage. Can you imagine trying to sell that much
hard drive space to someone? Yeah, you need more space than the Internet! I
bet they aren't even using as much space as YouTube. I tuned out after reading
this comment in the article.

Ever since I read PG's article about PR I've been leery of articles that stink
of PR. This article reeks of it and then he goes and makes an incredible claim
with no backup. There are hundreds of other articles I could be reading, I'm
done with yours.

~~~
bsaunder
Yeah, he hardly seemed like an enlightened CEO... exactly the kind of person I
want running my competition.

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henning
I thought the entire point of "enterprise" was accepting low development
velocity and bad design in exchange for support and scalability (however
akward). So, by definition, yes. By design, yes.

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migpwr
Does it need to? I am going to take the unpopular stance on this and say no...
enterprise software does not need to be innovative, it just needs to work.

redhat, vmware, oracle, microsoft etc... they all deliver what their customers
need, not stuff that impresses magazine editors. The software keeps steadily
getting better and although they don't have every whizbang feature in the
book, they get the job done... that's what matters.

Do you have a better, faster way to do backups? A solution to documentation
everyone hates so much? We'll pay for it if you've got it... after someone
else goes first.

~~~
neilc
There are hard problems in enterprise software that require innovative
solutions. For example, data warehousing is crying out for better technology,
and as a result, there are a multitude of startups building new technology to
compete with the established players. Stream processing is another area with a
ton of innovation, as is business intelligence/analytics, virtualization,
security, etc. There's tons of innovation around financial services: building
systems to facilitate automatic trading systems based on financial models.

One important difference between these markets and the typical consumer
startup is that enterprises are inherently more conservative, and for good
reason. You need to be able to offer an enterprise a lot of value, in exchange
for the inherent risk of going with a startup with unproven technology. That
means your value proposition needs to be compelling: you need to solve a
_real_ problem, and effectively allow the customer to make more money than
they're paying for your software.

Frankly, I think saying "there's not much innovation in enterprise software"
just indicates how much of an echo chamber the online startup community is.
There _is_ plenty of innovation, it is just rarely described by TC, Om, and
the rest.

~~~
mattculbreth
Good post. This forum is slanted heavily towards consumer-based web apps.
Certainly nothing wrong with that, and I'm a big user myself. But I'm not sure
that there's really a lot of experience here working in the enterprise space.
The ages alone (from another recent thread) would seem to back that up.

That said, there's some dreadfully boring, stodgy software out there that
companies spend quite a bit of money buying. My startup is aiming directly at
this space (BI, as you've pointed out).

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nikolaj
I liked his criticism of big archaic architectures built up by armies of
consultants.. until he said this:

"This new predictive system is the service-oriented architecture (SOA) I spoke
of earlier. We call it that because it serves you and your customers better."

~~~
bsaunder
Yeah, "it serves you ... better" ... reminds me of the Mauve DB dilbert (it
has more RAM).

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umjames
It's funny how the person being interviewed is the CEO of a company that makes
products that require the same expensive, over-hyped crap that he says is
keeping "innovation" from happening in enterprise software. Otherwise, it's
just more buzzword-compliant riggamaroll spewed by yet another clueless
"enterprise" corporation.

Enterprise software lacks innovation because it's doing all the things that
startups know don't work. Expensive, closed, proprietary software running on
over-hyped big-iron servers, purchased by idiot execs and managers, maintained
by clock-watching office drones who are working for old-school face-time-
focused companies.

~~~
comatose_kid
Hmm...but amazingly, these companies are profitable. It is easy for
technologists like ourselves to only think about...well...the technology. What
about the psychology behind the decision process?

A little thought experiment - say that you created enterprise software that
worked perfectly, but was inexpensive, easy to use, and ran on a Commodore 64
(okay, or some low end PC). Would Cisco even let you through the door?

Also, no matter how good the system you create might be, it still costs your
customer time and retraining to implement and support your new solution.

One last thing to think about (and to echo my first point) From Cialdini's
'Influence, Science and Practice':

[Chivas Regal Scotch Whiskey] "had been a struggling brand until its managers
decided to raise its price to a level far above its competitors. Sales
skyrocketed, even though nothing was changed in the product itself (Aaker,
1991)"

~~~
umjames
Which companies are profitable, the enterprise software companies or the
corporations that buy their software, or both? I'm not blaming enterprise
software companies for making money selling mediocre technology that doesn't
work as well as advertised. I'm more upset with the companies that continue to
buy such software, even when they know going in that it doesn't work as well
as advertised. It's exactly what PG describes in his "News from the Front"
essay (<http://www.paulgraham.com/colleges.html>). A lot of these enterprise
software companies rely on corporations trying to cover their asses by buying
enterprise software from big companies. It makes everyone feel safer in terms
of perceived job security, but does it actually work well? Most of the time,
the answer is no.

I'm not saying it won't take time to retrain people on better technology. I'm
saying that, in a world where IT departments aren't seen as cost centers,
better technology (meaning that it works well, is easy to setup and maintain,
and is robust enough to work with other technologies not created by the same
company) will yield better results in all aspects.

I realize that IT departments and enterprise software vendors won't do such
things. I guess that's why I come here so often.

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daniel-cussen
CEO's should start firing people who buy IBMs.

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edu
Yes.

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edw519
If idiots implement garbage using a certain technology, is it the fault of the
technology?

Whether it's relational database, client/server, green screen, closed source,
etc., etc., etc..., for every horror story, there are a hundred successes. The
fact that Web 2.0 presents wonderful opportunities doesn't diminish the
capabilities of other technologies just because someone with a hidden agenda
says so.

SAP was a scam shoved down the throats of very large companies by their own
auditors, using Y2K as blackmail, in order to add on their own high margin
services on the back end. Big ERP has desperately tried to "scale down" to
medium and small organizations with limited success, just as new technologies
are "scaling up" to service the demand of the unsatisfied millions. No secret
here who the winners will be.

