I am a co-founder at StartupNorth and was previously the Founder of Firestoker.com, to go further back than that you will have to go to my LinkedIn Profile.
A recent study ranked my hometown, Charlottetown, as the 3rd “happiest” place to live in Canada.
This makes a lot of sense to me. Anecdotally, the vast majority of the people I know who live in Charlottetown love it there, and they are truly happy people.
There is one small detail that a lot of us forget when we jump in to a new venture. The one nit-picky thing is that it is usually a good idea to have a maket to sell in to.
Some products find a market. Some will disrupt a market. A few will capture a market, and even fewer will create a market.
Is there such thing as an Enterprise 2.0 market? If so, can you sell in to it? If not: are there startups trying to sell to customers who don’t exist?
To answer the question: There is no Enterprise 2.0 market. Enterprise 2.0 budgets do not exist, except where some early adoptors create them, and there is no Enterprise 2.0 sales cycle. There are very few incentive available to experts right now and the discontinuity that has arisen in the concept is a symptom of that.
From an economic point of view, Enterprise 2.0 does not exist.
This presents a problem for a few people, but most of all it is a barb in the side of the world of Enterprise 2.0 Startups we have seen emerging in the last few years. Most have spent a lot of time, and even more money, trying to sell in to a market that they have no power to either create, define or own.
If you are trying to define an Enterprise 2.0 market, then you will first need to define a problem set that is solveable and that customers in the market will reward you for solving.
Defining the narrower Enterprise 2.0 Software Market means having a problem set that is solveable by software alone. If you are a provider of software only, then this is a big problem right now.
OUCH
Since the genesis of the term Enterprise 2.0, most of us have not had a problem describing the technology that falls under its umbrella. SLATES, which stands for Search, Links, Authoring, Tags, Extensions, and Signals, is a prime example as it defines a set of technical patterns which could theoretically be applied to solve some set of problems, but the catch is that the problem set still remains largely undefined 2 years later.
What markets do exist?
You can approach this problem 2 ways. The first is to offer a solution that solves a basic need across a host of industries. Jeff mentioned Echosign as a great example of this, their digital signature solution is growing steadily across a large customer base and they are potentially becoming a platform for other identity-based solutions. This is dramatically different from selling a suite of tools to a host of industries, it is focused on solving a specific problem using the 2.0 motif.
The second approach is to sell in to existing vertical markets. That means you are building an Enterprise 2.0 specific toolkit for an industry that needs it. In doing this your solution will have not offer just the same Social Bookmarking, Tagging, Blogs, and Wikis that you probably have, but you will need to offer vertical-specific features which string your Enterprise 2.0 tools together. In doing this there is also a potentially lucrative platform play in partnering with other E2.0 companies who want to sell in to your vertical market.
You will die on that cross
Do not go to war for Enterprise 2.0. We are seeing many of the failings of the moniker as its message has become more and more fuzzy, it is time for you to rescue your startup and refocus. The people who are making the most money off this term right now are consultants who are helping their clients navigate some of the fluff from the substance.
An Enterprise 2.0 market can only emerge when there are a significant number of healthy startups who are successful in either their own vertical or niche space. Through the slow rolling up (consolidation) of those smaller markets, a larger market can be created. This has been seen with Content Management and even with Sharepoint (yes, there is a Sharepoint market). It never did happen with Knowledge Management however.
What about me?, I am an Enterprise 2.0 customer
I can only imagine that this post is a little confusing for those of you who are trying to bring Enterprise 2.0 solutions in to your companies. Here is my advice:
Find a real problem and find a real solution for it
If you recognize like I do that throwing grease (I mean – SLATES) on the fire will only make it worse, then try to focus in. What specific problems in your organization could benefit from a blog-based approach, or under what circumstances would a wiki solve a real headache. What I am saying is: Turn off the noise and get down to work
Don’t trumpet Enterprise 2.0, talk about those real problems
When you find or solve a problem then you should talk about it not in terms of Enterprise 2.0, but in terms of an agile, low-cost approach. This makes sense to a lot more people.
I believe that Enterprise 2.0 provides a framework under which early adoptors are able to connect and share their own knowledge, but it is far too loosely defined in order to be able to be applied directly to any set of organizational problems. What makes it worse is that also means there is no market which can sustain Enterprise 2.0 innovation, and I believe that lack of a knowledge market and of a real dollar market is why we have seen so little movement in the concept in the last year.
The Enterprise 2.0 moniker is for those who do not need direct economic reward or incentive.
Hey Seth — within Canada Michael Geist is generally considered to be the one who has spearheaded the opposition against the new Canadian copyright bill. Cory is, obviously, one of the most well read bloggers in the world, but I think Michael deserves a lot of the credit here for bringing the conversation up to a level that politicians and highly influential people understand.
We love Cory, but it is Michael that we all turned to when we needed a leader on this.
Robert Scoble kicked off a huge debate yesterday.
I think there are two views of Enterprise Software which are, at their core, irreconcilable.
Will there be one winner in the end? Will there be separate streams of it development and thinking in the enterprise? I’m not sure about either, but here is how I see the current environment. If you do not draw the distinction, the debate gets very murky very quickly.
The first responder in yesterdays debate was my fellow Enterprise Irregular Michael Krigsman, who writes one of my favorite blogs, IT Project Failures.
Robert Scoble misses this point: unlike consumer software, where sex appeal is critical to attracting a commercially-viable audience, enterprise software has a different set of goals.
Enterprise software is all about helping organizations conduct their basic business in a better, more cost-effective manner. In software jargon, it’s intended to “enable core business processes†with a high degree of reliability, security, scalability, and so on. These aren’t sexy, cool attributes, but are absolutely essential to the smooth running of businesses, organizations, and governments around the world.
Michael pretty much represents the first, and largest, school of thought. Most of the Irregulars also seem to have the same definition of enterprise software,
The Results of this approach to enterprise software is that you are able to maximize efficiency, reduce costs and potentially enable some workflows that were not possible before a large system was in place, but you do it all within the existing structure of the enterprise. This is attractive, for example, to Private Equity investors who see an arbitrage potential in using large scale IT implementations as on tool of many to turnaround a business in a lagging industry.
A few of the conclusions of the enterprise software sexiness debate was that soon enough the presentation layer would be peeled back far enough that proper designers could focus more on the sexiness of the software and that would be the solution. That is a little thin on substance however, users are not actually screaming out for prettier interfaces. They really aren’t.
Stowe chimed in to the sexy-software debate and made a point that I can often be found making over martinis on a Friday: The next leap in software is putting the user first.
This is the second school of thought which is still emerging: it says that future enterprise software implementations will force massive changes in the very organization of the enterprise. The end goals for this school are to see networks surpass hierarchy. Cross functional teams will be the norm, efficiencies will be replicated and iterated with blinding speed and new product/service development will be a constant, not a project. By putting more power in the hands of the user, both functionally and organizationally, software will have this changing effect.
Front line employees, having access to the same knowledge and data (which was previously locked up), will contribute to the high-level decisions of executives through rapid feedback loops and clued-in executives will not react to obvious needs but will co-opt them.
A fork in the road, and it is where I think this Enterprise Hot-or-Not debate got off the rails.
You see, many average joes like Scoble are drawing a long-term assumption, and that is that enterprise software is going to converge with where consumer software is right now and where it is going.
The problem is that if you understand current enterprise systems, you know that can’t really happen. You can only hope that things will get a little prettier and perhaps that there will be updates to the software a little more often. IBM, Oracle SAP and others are already starting to deliver updates and UI enhancements more often than they once did (at least it seems that way).
What Scoble is imagining, and what people like Stowe and I dream about on long walks is fundamentally at odds with a large rule-based enterprise platform.
The middle ground that is emerging, which I am not a believer in, is that existing enterprise platforms will continue to dominate the user experience and that more social applications, like social bookmarking, wikis and perhaps blogs, will live alongside these systems.
There is one problem with that: Users won’t take it sitting down.
Those of us who have done large-scale social software implementations have seen that the results are much more nefarious: Once users begin to use social software in their daily work, it begins to capture massive amounts of their attention, and it also influences their thinking. This isn’t immediate, but it happens eventually and is significant.
All of a sudden users will begin to question arbitrary workflows in the SAP install, and they will be frustrated with how news gets pushed out on Sharepoint. The list goes on. The biggest problem isn’t that they are merely frustrated however, it is that they now have the tools to both express and remedy that frustration.
Once example we have seen is with a franchising client that was drop-shipping items to their franchisees who did not need them (this was to create a more consistent cost base for the franchisor). Previously a complaint to corporate would have resulted in a “we are considering your feedback” type response, but instead, the franchisee is now able to air their discontent with the entire network through an internal group blog, who in this case all had the same issue.
Old school (school #1 if you are keeping count) thinking would probably tell you to shut this conversation down immediately and to simply deny the existence of the problem because the drop shipments provided a significant benefit to the central corporation. Luckily this client sits in School #2 and can see that creating a more resilient network is far more beneficial than creating a single short-term efficiency. You cannot create resilient and self-healing networks with rule-based IT platforms. You need a combination of social software and business strategy to accomplish this.
When it disrupts instead of enforces
When Enterprise software is changing organizations, it will make the news. When corporate hierarchies flatten and individuals contribute to both the work and the art of the organization, then it is something they will tell their friends about over drinks.
A sort of “and then the CEO admitted I was right, and I got 25 comments” moment.
When the user is in control
Configurability, personalization and sharing are not considered technologies by most users, they are a base use case for their personal lives. People understand control in a very serious way, and they know when they have it and when they do not.
When it is surprising
Software can be surprising in the best and the worst ways. It should still be surprising though, in some way.
When it changes
I mentioned earlier that people understand control in a very fundamental way. We all understand wealth in a similar fashion, and we know who is reaping the wealth from our work. When enterprise software generates returns for the user in the same way that it generates returns for the enterprise, then users will feel delighted. Whether it is more personal interaction, a sense of control or more personal time, the changes that will be noticed will not be in interfaces or firewalls, but in the actual everyday life of the user.
I have been using Defensio.com on this blog for a few weeks now, and I am going to say that it is now better than Akismet was. Defensio takes a little bit of time to clue in to all spam, but it is a short process.
For those who don’t know, Defensio.com is a spam filter for blog comment systems. It is currently integrated with WordPress blogs like this one, but there is an API that lets other applications use Defensio as a spam filter as well.
Now, go to any TypePad blog and leave a comment. You will get a nasty human-checker CAPTCHA like the one below. It is archane and acts as a barrier to participation for everyone, let alone anyone with a vision problem.
Now that Six Apart is getting back to things like blogging, as possibly evidenced by the recent selloff of Livejournal, they really should consider buying Defensio outright while the service is still young. If Defensio isn’t up for sale (I mean, everyone has their price), then a partnership would be sensible and smart for both sides. The Defensio product is solid and tested, and transparent spam filtering is a requirement for Six Apart’s products, not a nice to have.
Six Apart is widely considered to be the#2 blogging service behind WordPress.com for serious bloggers. I do not have hard data to back that up, but I can say it is the perception. Very few new bloggers that I see are going to Typepad, but I am not convinced it has to be that way. Great, easy, set-it-and-forget-it spam filtering would be the most productive first step towards turning things around that Six Apart could take.
Here are my Defensio Stats:
