Enterprise SW value, complexity, and R&D

Dennis Howlett’s extended response (here) to Vinnie Mirchandani’s post demanding more simplicity — or begging Steve Jobs to find it — in enterprise apps (here).  Dennis effectively boils down Vinnie’s argument to this:

Why is it that despite all the interest in SaaS and Enterprise 2.0 that the industry offers so very little apparent bang per buck for business as a whole?

Way too much to comment on comprehensively, but here are three:

  1. Behind the simplicity of iTunes lies the complexity of SAP ERP.   Every time you hit iTunes, you’re hitting SAP ERP.  Tell me again that the iTunes/iPhone model would work without ERP and that Apple’s not getting value out of its investment. 
  2. Enterprise software is modeling a business in real-time — a non-trivial, complex task that evolves in time.  Per Dennis’s comment about the process approach, once you try to take enterprise SW beyond implementing functions you’ve gotten into the business process management business whether you like it or not.
  3. Brian Sommer‘s comment is spot on: modern portfolio management is just getting introduced to the SW business.  Perhaps it should be a bit more ruthless.  Vampire/zombie projects, rampant cross-subsidization, and derivative products litter the R&D landscape in both commercial and in-house software development. 
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3 Responses

  1. Thanks for mention but I think you are taking the Steve Jobs mention too literally.

    I invoked Steve Jobs because of two reasons – velocity and relative payback

    a) because of what he has delivered in a short while in both iPhone versions, what his apps ecosystem has furiously developed in a few months and his plans to rapidly roll out to 90 countries. In contrast in enterprise software, everything is in multiple years, and the usual belly aching – oh, enterprise software is so complex to justify the snail speed and the huge TCO. And no real breakthrough stuff. SaaS is essentially re-architecting old ERP, CRM functionality not focusing on underserviced business functions (warehouses, plant floors) verticals or geogrpahies. Enterprise 2.0 vendors can barely cover HQ functions yet feel compelled to brag about the new “enterprise”

    b) I see over and over, pay back from what Sun calls the Internet of Things – sensors, mobile devices, appliances, RFID tags – generating for many many companies far better payback than plain old enterprise software

    But for the record I am not a Apple Fan boy. I have been harsh on the iPhone TCO – but that is more to do with AT&T’s economics. Having said that even that pales compares to TCO in enterprise software.

  2. Hi Vinnie,
    Thanks for the comment…I suppose that your mention of Jobs was like a red cape in front of a bull. A couple of notes of my own:

    1.) The SaaS story is as you say, another re-architecting of old functionality (see VisiCalc>Lotus1-2-3>Excel). Useful, but incremental.

    2.) How much of that payback from the internet of things is/will be dependent on having the enterprise SW backbone in place? Like the phone makers + and the phone companies, those “things” need a network to be useful.

    3.) The “stable core” for ERP, especially, must come with this round of upgrades. It is one thing to pay maintenance, it is another to have to take on the risks and expenses of upgrading. What’s the use of a backbone and business process network if you have to rip it out every three years?

    Best,,
    Paul

  3. […] sure have my doubts that on demand/SaaS will “immamentize the eschaton” as well (here, here, […]

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