Ideas that spread – wins!

Although it is an hour long video – but captures well why in today’s world it is vital for everyone to remain connected with their customers and help spread ideas. Also, Seth has great delivery and captures this topic so eloquently. It is fun to hear some of his usual examples around slice bread or purple cow. Anyway – enjoy.

Business of software

While talking to few acquaintances who are in the business of building different kind of software (Attention based; consumer product; SaaS; or others) than on-premise enterprise software products – it is interesting to observe similar discussion. This is probably the core nature of software business. At the end of the day it comes down to 2 set of metrics driving business:

1. Acquiring new customers/members/subscribers/etc. More and more businesses now run calculations to understand the cost to acquire new customer/member. Cost to acquire new customer usually is much higher than many would guess, if they had no clue. It gets costlier in mature industry where traditional market is about replacing someone else’s product. Also, it can be costlier in the web world where there is now actual cost of  goods sold (think of all the IT infrastructure that goes around delivering a service) as opposed to the cost of CD.

Question usually gets asked: Beside product strategy to attract and differentiate offering from competitors – keep cost of customer acquisition in check; what other ways to generate traffic/leads; foster communities; target competition; create winning buzz; adjust pricing or terms; bundle products/services to make it more attractive; etc. Increasingly more web based product focus on marketing presence on the local/industry circuit from the get-go rather broadly within ranks via blog/communities to earn credibility. Increasing emphasis on Marketing too important just to leave it to dedicated few – every one has to play.

2. Retaining a customer. It is about understanding the likelihood of customers staying on the product. Generally a combination of understanding attrition rate (as some folks leaves the fold) and knowing life time value of a customer/member. Although harder to find, however, there are industry best practice metrics for the type of busines one can use as a guideline. These days businesses (particularly on the web) have a greater understanding of trends among its existing customer base. One suggestion: if you don’t already know about your customer trends – invest quickly and gain better understanding. By the nature of it -Web based businesses know well how many of their customers renew membership; what is their average monthly dues; what %age of customers usually don’t renew; on an average how long customers remain a member; what feature gets used most; demographics details; etc. Likewise, enterprise software products – SaaS or otherwise have similar metrics to help project maintenance or recurring revenue.

Question usually gets asked: What needs to be done to keep a customer happy using our product/services? What features to add (particularly that generate stickiness); what pricing lever to play; how to provide value without disrupting the apple cart; what promotion to have; etc. To find the secret formula that can help a customer retained longer paying healthy dues – is what makes a business sticky and profitable in long run.

So to remain growing – it is about adding more new customers than the customers leaving the fold. Visualize a funnel – add more while few trickle away. A math described easy but takes an organization with a winning attitude to achieve…

Serving customer experience

Last few days I went through two separate incidents reminding me of poor business applications resulting into bad customer experience that can easily be avoided – should customer view point is considered while automating any business process. 

1. My elder daughter who is now 17+ was in the process of buying a car. I decided to have her apply for an auto loan where she can be a secondary co-applicant with me – hoping it will start to establish her credit history. We spent multiple hours at one of the major national bank filling out the paper work, etc. only to be reminded after few days that loan can’t be granted with her as a co-applicant given she is a minor. How hard it is to have a simple work flow in the loan application process to error out on the age of a minor while filing the application when certain conditions are not valid? Think about the countless hours wasted of the banker; someone from their lending department and leaving customer with a bad taste who unnecessarily have to go through this long process. 

2. A national university suggests we pay bill on-line to get student registered to their college. We all conduct commerce on-line and now assume certain level of service. However, this university only accepts MasterCard as an acceptable form of payment. It does not accept Visa cards or other popular on-line payment forms. Visa and MasterCard are the big gorilla in the credit industry. In fact, hands down Visa is #1 in the industry with 60% of the market share. MasterCard comes second with close to 30% market share. We happen to be fortunate and had few days left before the deadline for us to apply snail mail way posting cheque in mailbox. Why tout on-line when you can only serve a percent of the customers? 

Anyway, it brings me to the point – automating business processes are to provide improved customer experience. Making business applications usable and customer connected is important.

We experience similar trend in the enterprise software industry – particularly products that have been around for decades and has accumulated lot of features over time. But if those features are hard to use and don’t provide basic reminders or simple error checks – what is the point as they anyway end up in lost productivity and unsatisfied customers. Just ponder – how few features get used when the product is difficult to navigate and hard to use. Feature rich is good – but product build without customer experience in mind is simply not a recipe for success. Applications has to be usable and not just functional to serve desirable customer experience.

Usability matters and it is much more than just cosmetics.

Globalization of R&D

As world continue to flatten and economies become increasingly inter-connected – globalization of R&D remains a successful approach. Booz & Company published its recent study of 1000 public companies sharing the trend; rationale and geographic growth. The study is pretty recent and it was published in Winter of 2008. 

Check out the study here. 

This study emphasize – what I have always believed in – that globalization of R&D is just not about lower cost. Although cost gets more touted than the overall perspective that globalization can bring. It is about Innovation, access to better talent pool and market proximity otherwise not available. 

I also believe that doing it right require time and commitment.  There is no quick fix. In fact, more established an organization – harder it can be. It is like any other execution effort where there are companies that has successfully implemented the model as there are countless others who tried and failed.  

 

 

Snippet of message that sums up the study:

“… companies that invest wisely in a multinational innovation footprint are gaining far better returns on their R&D investment than companies that exclusively keep their laboratories at home — or that fragment them across a wide variety of locations.”

Here is a data point pertaining to the globalization of R&D as it relates to US: 

“At first glance, observers might think that this represents a loss of jobs, intellectual power, and influence for the home countries of these companies. But innovation spending seems to flow in both directions at once. Even as the companies based in the U.S. performed $80.1 billion worth of R&D in other countries, companies headquartered elsewhere poured $42.6 billion into R&D conducted in the U.S.  In fact, 40 percent of the money spent on R&D in the U.S. is spent by companies headquartered elsewhere. The total amount of R&D spending in the U.S. is 2.7 times as great as in Japan, whereas the spending generated by companies headquartered in the U.S. is only two times as great.”

Opening up source code

Some good pointers to consider making a close source effort to open source. Here is an example of Ingres and how it transition from close source to open source.

Key points – and SCO/Unix fight has contributed to this learning.

• Comb every line of the source before opening it up and remove questionable references/code snippets
• Pick the right open source licence
• It takes some promotion and effort to attract open source community
• Security concerns are not any more vulnerable in Open Source than Close Source (Re-engineering usually attributes to similar security vulnerability than what one may find reviewing the source)

I would probably add following to the list:

• Understand business need. Both Closed Source and Open Source (or a combination) has its merit – so understand what problem is being tackled by opening the source
• Consider what open community suits the need and how it helps the community
• Consider business model and structural changes required 
• Consider the stage of product life cycle

Innovation stumbling block

Innovation is hard. It is usually hard in an established organization. Why?

Top 3 reasons, in my mind, that hurt innovation in an established organization:

1. Knowledge – It is a double edge sword. While past experience helps but many smart brains get caught up to the learning or failed experiences of the past talking themselves (and unfortunately others too) out of good ideas prematurely.

2. Being perfect – On the other end, smart people looking for the perfection doesn’t help either.  Smart folks finding themselves rat-holing a conversation on obscure things making an idea too hard to conceive at the onset or too costly to tackle. Some time perfect is the enemy of good enough that stop conceiving a great idea from taking shape. Innovation evolves by shaping the idea one day at a time to its greatness.  

3. Afraid of failing – Smart people trying not to stick the neck out or taking chances that may make a difference because the potential of an effort may fail. It is our desire to act ordinary and remain on the proven path hence avoiding what best could have been achieved. It is amazing how conspiracy theorists (and they exist) attract smart brains keeping them just acting ordinary.

iCloud

Cloud computing is the buzz.

Cloud computing is on the rise.

Cloud infrastructure is becoming cheap and broadly available. Just check out the Amazon EC2 pricing.

Cloud grows (or shrinks) with my need. Infect there is a term for this aka “elastic cloud“. 

Cloud can support my on premise license software copy. 

Cloud computing has lot of cool acronyms – Saas, PaaS, HaaS, S+S, etc.

Moore’s law will continue to drive the cloud cheaper, reliable and readily available.

Some say – Cloud – like other essential services – is recession proof.

Only computer hardware that I need (someday) should be some plug on the wall.

So why buy my own hardware? when I can rely on the professionally managed, well administered, and reliable computing infrastructure for my personal or business use?

I want total control over my little cloud – including pulling it back on premise as and when I deem right.

I want computing infrastructure to be a matter of personal choice – whether I want it on premise or I want it on my cloud.

I want my cloud – mine…and good thing it is getting there.

Convergence

We live in a time of convergence where examples are littered show casing various technologies or products converging to enhance end user experience. One case in point digital media and home entertainment serving to improve everyday experience. Just pick one category of your liking and you will soon find someone is pushing the envelope either bringing adjacency services closer or building one if it doesn’t already exist.

Same is true for the business software community. It remains an emerging trend to converge and deliver enhanced experience for business users.

I usually put the convergence in three categories that overtime gets delivered as one unified solution. These are:

 

 

1. Improve a person’s productivity in the workplace.

2. Improve the ability to make decision easier based on historical or projection based heuristics

3. Improve an individual social standing in the peer community

 

 

 

Alienus Non Diutius

Pixar motto “Alienus Non Diutius” (Latin for ”Alone no longer”) speaks volume. Pixar is probably the only Hollywood production house that emphasizes collaboration where crew remain employed one movie after another. This is considerably different from other production houses where everyone is on a contract for one movie. Once the movie is over folks moves on to their next production forming another crew with other production houses or whatever else they can lay their hand on.  

Is it just a coincidence that Pixar continues to deliver hit after another hit? or is it the team work that make Pixar stand out. Consider Toy Story, Monsters Inc, Bugs life, Incredibles, Finding Nemo, Cars, Wall-E, etc.

“Alienus Non Diutius” hits the nail for software organization. Gone are the days of lone rangers where organization rode on the back of heroes only to find they can’t scale. Heroes are still needed (actually by a lot) – but someone who knows how to be part of a team environment. Such heroes bring sea change in an organization. These gifted individuals groom other strong players bringing high tide in the organization and make it play on a level field otherwise not possible.

Simplicity – an example

NYTimes published this interactive chart showing statewide voting trends of democratic primary.

Just plain simple and easy chart - allowing information to dice and slice; form individual opinion and navigate the trend.

Consider the amount of multi-dimensional data that this chart shows. It consists of 16 dimensions; 50 data points; each data point suggesting additional attribute of %age point gain; etc. times 2 – one for each candidate. This easily require decent amount of data crunching to capture the information.

Also, consider how many ways this information could have been rendered to show various scenarios effectively.

Isn’t this chart easy? Instead of getting drowned in the whole bunch of statistics and data – this chart allows connecting dots and seeing the trend otherwise not visible.

Similar opportunities exist for browser based business applications in improving user experience that enables an individual to be informed; help make decisions; manage individual relationships and network along with the variety of tasks he or she need to get done.

Peachtree 2009

Earlier we released Peachtree 2009. This release has some great features - including improvement in the Payroll, Cash Management and Reporting space.

Also, check out Quantum, which include smart posting effort and others enhancements boosting tremendous performance and scalability gains. This will be a great win in the marketplace for our Peachtree/Quantum customers.

Kudos to the Peachtree organization for delivering yet another great release in the marketplace. Keep up the great effort Dena, Katie, Jason, Mandy, Rachel, Jeff, Doug, Rick, Eric, Natalie, Andrea and everyone in the Peachtree organization.

Incredible footprint of the product portfolio – addressing the need of an entrepreneur to an established enterprise; from Peachtree, Quantum, MAS 90/200 to MAS 500 – all seeing new version out in the market place with tons of customer value enhancements, technology uplift, new modules, improved performance and scalability. Way to go team!!!

 

Kaizen

A key measure of a successful product organization is its ability to deliver on Quality commitments. This usually is the cost of entry in a competitive market landscape. There is no magic formula for an organization to get there. Key remains building a culture of continuous improvement.

In Japanese, there is a term that describes “continuous improvement” mindset well. It is called “Kaizen”. Toyota actually mastered this and it later became part of the DNA of various Japanese companies causing them to win the marketplace primarily on the basis of Quality.  

Kaizen emphasize the culture of continual small improvements that yields large results in a form of compound productivity improvement over a period of time. The “zen” in Kaizen emphasizes the learn-by-doing aspect of improving productivity. Idea remains smaller experiments, which can be rapidly adapted as new improvements are suggested.

In our industry one way to measure Quality is considering how its “Quality curve” looks like during product development. It is plotting number of defects on y-axis during various phases of product development. A traditional organization that deals with quality late in the development cycle may look like the following:-

to another with the emphasis of bringing quality early on during the development cycle:-

So watch out next time as you encounter bumps that can be improved. What you do to get around those bumps and how you address it has an impact towards building winning organization. Every effort counts.

Power of an Agile Mind

Agile processes have come a long way. It is now available in various flavors and different names. All promises an organization’s ability to deliver customer value faster while enabling organization to deal with the change. Several successful stories ranging from start up entrepreneurial companies to established large software organization help Agile Processes continue to gain traction. 

However key to the success comes down to the people. Agile processes like Scrum are great enabler in tearing down the barriers and bringing cross functional organization closer. But at the end of the day it is about how people approach problem and tackle everyday situation. Individuals with Agile mind tend to accomplish things that otherwise remain unaccomplished. Agile is as much a state of mind and how individuals in an organization approach things as it is about process and structure.

So what makes an Agile mind – beyond the classic chicken and pig story? Here are few characterstics -

• Believe in working as a team and recognizing team success
• Embraces change and focus more on providing solutions to the changing need
• Works relentlessly to remove barriers and getting today’s work done today
• Take individual responsibility and pride in an individual work
• Focuses on big picture and understand customer needs
• Deals with conflict in a positive way

Interestingly as I was searching the Internet on Agile mindset – I stumbled on this link around how agile mindset is applied by the US Army in Iraq. Similar principles in a different setting demonstrating the power of good communication flow and empowered individuals.

Facebook

Last month or two, blogsphere is abuzz about Facebook. Particularly, after Mark Zuckerberg, wonderboy CEO of Facebook, announced F8. For those who missed F8 announcement - this is Facebook launching a development platform to building applications leveraging social networks. A very good analysis of Facebook and its new social platform is done by Marc Andreessen at his blog here. I will recommend reading it.

F8 platform provides a good extensibility model around Facebook at interfaces/API, data access and user interface level. I also like the fact how it makes a close system – Facebook site in itself, open to building and extending the system – like building other applications on top of Facebook plus the governance model around it.

This move towards providing a platform for build social applications and access to its social network is fuelling speculation on how Facebook is going to be the next big thing. Pundits are already putting Facebook in a different league than MySpace given its open platform and ability to attract and build healthy and bigger ecosystem.

Personally, I like the move as it continues to influence and challenge traditional development thought processes by opening up the development paradigms necessary to embrace social style of development. An approach that embrace opening up development paradigm to foster healthy eco systems required to serve products and services necessary to deliver unique customer experiences. I have covered this topic in different contexts here, here, here and here.

Peachtree 2008

Earlier this week we announced the availability of Peachtree 2008 release. This is a new addition to my responsibility at Sage Software beside MAS products. Peachtree product development team in Atlanta is amazing and true to the tradition just released another great, simple to use product. You can learn more about the Peachtree product line here. It is an easy to use accounting product that provide deeper functionality and great customer experience to entry level businesses. It comes in four packages - basic, standard, advanced and premium.

Kudos to the team on another timely and quality release out of the door.

Tru.vu

Tom Chikoore sent me a note over the weekend sharing he just co-founded and started Tru.vu. This is still a beta site – but I wish Tom and Tru.vu success. He is very hard working, dedicated and talented developer. I remember his passion helping evolve interoperability infrastructure and defining SOA enabled architecture several years back during JDEdwards days when SOA was in its infancy.

Good luck Tom!

XP is back

Dell today announced it will provide an option to chose XP when ordering computer from them. Here is the annoucnement on MSNBC.

Hopefully, this announcement will serve our customers well and give them the choice to decide what they want based on what serves them well.

Usability 101

John Grant from my team forwarded this. Hilarious clip. Since it is in scandinavian focus on the subtitle in english.

You get what you measure (or lack of)

As the saying goes “What you can’t measure – you can’t improve”. Paul Kedrosky mentioned in his blog various metrics an enterprise software company to use. It lists a score card of a typical good enterprise software company.

Personally, I am a number kind of a guy and also emphasize measuring various aspect of business – be it around what we do (building, selling, supporting, etc.) in a company or how (process, organization structure, etc.) we do it. It makes decision making objective and helps the organization to focus on the right things. Although, people need to keep in mind common sense and an aspect on subjectivity before making decision – as sometimes indicators don’t tell the whole story.

Also before instituing any metrics, an organization management, should carefully consider what it is trying to accomplish. Metrics drives behavior within organization. So good metrics drive good behavior and bad metrics drive bad behavior in the organization.

Paul Kedrosky’s blog suggests few key measurements around various aspect of the business. It also include a typical score card that can be used to benchmark. Check it out.

In product development, few of the metrics that I find helpful are around the following:

1. Utilizing capacity and resources

2. Progress of current work in development

3. Several quality metrics of work in progress during various development phases

4. Quality of releases in the market

5. Customer satisfaction metrics

6. Various organization metrics

First month at Sage Software

One good thing about being terribly busy – time flies. I just finished my first month at Sage Software. Looking back, I find the first month fulfilling. I spent much of the time learning across 3P – People, Product and Process.

I spent good amount of time meeting people within and outside my organization. I tried to cover and meet my development organization at Irvine and Toronto. I met various leaders at Sage. I met a few of our business partners who are extremely dedicated to our products. Although, I continue to learn here, but it has jump started my journey at Sage and provided me various perspectives to have early discussion around organization.

In the coming months, I look for opportunity to meet customers and visit development site that I have not covered to meet with the team members in my organization.

I also spent much time understanding various software development and organizational processes. I have several products in my portfolio (MAS 90, MAS 200, MAS 500, PFW and BW) and an organization that is geographically spread out. Each product team, based on the need, has evolved and morphed the processes over time. This makes it quite a learning curve to understand all the different jargons and acronyms used. I think, I am getting there where I can have meaningful conversation like a native with all the right jargons and acronyms in a sentence.

Also, I got several opportunity to review various product in action. I had few architecture discussion around MAS 90 and MAS 500 products. It is helping me form an early impression to have few discussions around evolving architecture. I also got the chance to review product roadmap and get the glimpse on where we are trying to sail the ship. I reviewed current releases in development. 

All in all – it was a great first month. Although, it kept me away from blogging but I am hoping I made up the time learning various aspect of my new job.

 Bon voyage!

un pour tous, tous pour un

Oh! I just love it…

One for all, and all for one. Teamwork rocks!!

…

3P – People, Product and Process

Last few days, I was busy clearing much of the boxes that I had brought back from my office. It was walking down the memory lane going over various folders, documents and depositing them to recycle.

One thing I noticed was how long 3P – People, Product Process has been part of my work. I found meeting agenda starting in year 2001 that included 3P. Managing around these dimensions became an integral and central part of the work. Although, the concepts got molded over the period of time.

I don’t recollect how I got exposed to 3P initially – but I recall managing to these dimensions got re-enforced after I read “Execution” by Larry Bossidy and Ram Charan sometime in 2002-03.

In “Execution”, these three dimensions were referred to as “Strategy” – focusing on why/what; “Operations” – focusing on how; and “People” – focusing on who.

Coming from the Product Development organization, “Strategy” seemed to me as something that result into a “Product” and “Operations” was all about “Processes” needed to build an efficient organization.

So what surfaced in my staff agenda in 2001 – still remains an integral part of the agenda today.

Also one thing about opening old boxes – sometimes I think, it is better to keep them closed. It helps save time and grief.