Not Exactly Business As UsualNot Exactly Business As Usual

Who was the guy who said, about 100 years ago, that the Patent Office should be closed because everything that could be invented had been invented? I'd like to see if he's still around; it would be fun to hear his take on the enterprise software market. You could hazard a guess that his impression of that market might be that it should be put on ice, because not only has everything that could be invented already been invented, but it's been invented two or three or 10 times already-sometimes even by the same companies.

But just as he was profoundly wrong back then, so, too, would he be woefully off the mark here as we approach the midpoint of the first year of the first decade of the first century of the third millennium. (By the way, is this really the third millennium? If it is, what about the stuff that happened before year 1?)

I shouldn't be too hard on our shortsighted visionary; after all, hindsight grants all of us great genius. Like the several hundred thousand people who after the fact claimed they were in 40,000-seat Wrigley Field in 1932 and saw Babe Ruth point to the center-field bleachers before launching a home run to that precise spot, there sure are a lot of folks out there who knew the market was overvalued, a correction was coming, the Internet was a joke, and that the dot-coms would all die. There's no record anywhere of any of them having said anything on the record to that effect before the fact-but after the fact, they're insisting that they knew it all along.

But back to the enterprise software market, which itself has been battered by some of that revisionist history: "I always said CRM was a bunch of baloney ... when XYZ's stock hit $120, I shorted 3 million shares at $8 per and never blinked ... The Web makes enterprise applications obsolete ... It's all too expensive and nobody will buy it anymore"-that sort of insightful thinking.

The facts, however, point us in a different direction. Like manufacturers of American cars 20 or 25 years ago, enterprise software companies are learning-at a stunningly rapid rate-that the days of force-feeding what they have to a generally unhappy but alternativeless public are over. That out-of-control complexity, X-year implementations, and zero flexibility will no longer be an acceptable exchange of value when millions of dollars are being paid.

We're seeing Oracle change its pricing structure in the face of significant customer dissatisfaction; we're seeing a young but rapidly growing software company called Allegis (in the partner-relationship-management space) establish a policy that customers don't have to pay any money until its software is deployed-that is, up and actually running live. I heard last week of an enterprise application vendor called TenFold, whose main value proposition is guaranteeing installations on an aggressive schedule and with a fixed price. While the overall idea is intriguing, the big question is, what does TenFold's "guarantee" entail? As I heard it, the original plan was that if the installation wasn't completed on time, TenFold would keep members of its team on site until the software was running properly. That approach didn't have enough value for customers, so the vendor switched the policy to offering to give customers their money back if they weren't satisfied.

Then there's Blue Martini, whose definition of "e-CRM" is not "E" meaning electronic but rather external: modeling its software and the performance and intelligence it delivers to customers on the world outside of the customer's walls, rather than as a simple reflection of how it keeps records internally. Microsoft is working to make Office a, uh, window into the information and knowledge gathered and generated by enterprise apps. Many more examples of such fresh and customer-centric thinking are popping up in the enterprise apps market.

To me, this doesn't sound like business as usual. While it might be a tad early to stretch this prediction out to the fourth millennium, I think it's safe to say that we should keep the Patent Office, and our expectations for the enterprise software market, wide open for some time to come.

BOB EVANS
Editor-in-Chief
[email protected]