Why Vendors don't get Enterprise 2.0

Enterprise 2.0 is NOT simply Web 2.0 haphazardly packaged up for Enterprises
After spending three days at CMP's Enterprise 2.0 conference in Boston, I'm convinced that most Vendors don't quite get it (yet).

In fact, the Vendor climate was such that a more appropriate classification for most sales pitches is SMB2.0 - Small to Medium Sized Businesses only. Globally distributed institutions need not apply - or rather cannot apply... The Vendors are just not ready. The solutions or products hyping up the E2.0 story are:

1. Redundant - unique positioning and value proposition is at best, in the Ajaxy interface.
2. Unmanageable - little consideration for centralized settings management and lockdown
   
3. Narrow - you have to assume that in most cases Corporate IT gets the value proposition of asynchronous collaboration -- Wikis and Blogs. Stop talking up "Yet another Blog or Wiki", show integration, management, interoperability, extensibility. All purchases go through Corporate IT. Learn to work with them.
   
4. Monolithic - Do not plug into existing infrastructure and platform investments. On some level a Blog is nothing more than a datatype. When pondering synthesis and integration, this is an interesting thought...
   
5. Unproven - I'm not talking about ROI numbers, that's a different point. The vendor has to respect decades-long relationships that most Enterprise-scale companies have developed with the Microsofts, IBMs, SAPs, and Adobes of the world. It is unlikely that the vendor can compete with them head to head on a platform level nor (and more importantly) on a "trust" level. Say whatever you want about the giants, they've earned their stay.
   
6. Non-compliant - The need for archival and retrieval, granular micro-information management, and so on is huge in the world of finance. If you sell in the New York area, these are your biggest (if not only) real Enterprise clients.
7. Can't prove ROI - This is the classical Chicken and the Egg problem but it can be solved!

Yet, instead of figuring out how to work with Corporate IT most vendors and even leading researchers in the E2.0 field marginalize these gaps in favor of stories of egalitarian and productive workforces powered by social networks and asynchronous web-based collaboration tools.

Selling a piece of paper with the word Blog on it
I am convinced that the following can outsell every new Blog, Wiki, Document Management, etc vendor in the space today:

1. Develop components that fall under:
1. Enterprise Security
1. Integrate with existing SSO solutions an Enterprise uses
1. Polls LDAP or some other corporate directory for all user/group information and ACLing
   
2. Enterprise Management
   
1. On the Desktop: exposes every single setting or tweak to GPO management, packages updates as MSTs,
   
3. Service Oriented Architecture for Federation
1. On the Desktop: provides an open API and modular components that can be plugged into, extended or swapped out for other in-house components
1. On the Server: uses scalable, open standards implementations with open API and ability to delegate services (data storage, tagging, feed subscription and what not) to other in-house components
2. On a piece of paper, write the word Blog or Wiki representing the cool Ajax or Flex-driven interface with a promise to finish the actual implementation later...
   

Stop vilifying Corporate IT!
Please stop promoting the "Corporate IT, get out of the way!" mentality. No sane and risk-minded institution will permit discrete sectors of the user-base to just deploy whatever Blog or Wiki or Issue Tracker they want. Spaghetti Infrastructure is extremely hazardous and unacceptable. The complexity of having to clean up the infestation of SMB2.0 products will leave a very bad taste in the mouths of those that make purchasing decisions, period. Furthermore, it will derail Evangelism campaigns that many of us working in Corporate IT are working our Butts2.0 off for.

Although I will cover Adoption in a later post, for the sake of continuity, E2.0 Adoption is both, a Top to Bottom and a Bottom to Top story. Business Units and Corporate IT have to move together and meet in the middle. Vendors must be able to meet the demands of this "middle". Nothing else makes sense.

Inside Corporate IT
Enterprise-class institutions invest millions if not billions of dollars into IT, annually. Agility and competitive advantage in today's market demands the best of what technology sectors have to offer. Corporate IT exists and recruits the Best in strategic fields to follow trends in technology and to leverage the best-of-breed products in-house. In short, don't ever underestimate what Corporate IT understands about collaborative technologies and the E2.0/Web2.0 space.

In some sense, many Corporate IT silos are 1 to 2 years ahead of the vendor with respect to the required sophistication of any consumer product. Most are developed in-house and are guarded as a corporate asset. This is not the Vendor's fault! Maybe Corporate IT doesn't publicize requirements nor participates in Community Incubation as much as it should. This is a separate battle and should be a big part of what defines E2.0.

However, it is also true that the Vendors don't bother to ask and are then very surprised at how forthcoming large institutions are about their needs. It's much easier to repackage a consumer product and find an SMB who will drink the cool-aid, buy the product and in turn, become a statistic to justify First-round funding for a startup. Don't get me wrong, SMBs are a great place to get your feet wet but the vendors aren't marketing to SMBs per se, they are marketing poorly baked consumer products to Enterprise customers.

Something's not right here. To be successful, Enterprise customers and Vendors must learn to communicate needs before the products are fully baked. Otherwise this is all just a waste of time as fledgling companies swimming in the E2.0 pool will simply be drowned out by the few that actually Get It. Wikinomics has to happen at Inception and Development stages of Blogs and Wikis too. Vendors will be surprised at the Top 10 requirements lists for a product to be considered Enterprise2.0-friendly by the actual Enterprise.

Risk Management
Corporate IT is not in the business of Security - this view is extremely narrow. Corporate IT is in the business of Managing Risk. Risk management covers every tier of technology from Infrastructure to the JavaScript that makes the async calls somewhere else. Everything is scrutinized. Everything is consolidated, centralized, made lean and mean if for no other reason than to make the act of scrutinizing a bit more manageable. Yes, even Managing Risk is Managed against Risk. The penalty for goof-ups is extremely costly. Spaghetti Infrastructure and redundant deployments of monolithic apps that cannot be scrutinized in a manageable manner is a time-sucking, money-wasting, Very Bad Thing.

Enterprise technologists think of Technology-based Solutions as portfolio items and have learned (perhaps the hard way) to develop Infrastructure along-side Software, not as an after thought. If you sell to corporate IT, Enterprise2.0-friendliness has to also be shown from the Bottom, Up.

Build vs Buy
Core Competency is loosely "Buy don't Build whatever it is you need but are not selling". Why is it then that many Banks and non-Software/Middle-ware institutions build their own solutions in-house that are years ahead of what vendors are delivering? There is no blame-game being played here, it's just the state of things. Community Incubation parlayed with Wikinomics and Open Source can help address this problem. More posts on this coming soon...

Some Advice to Startups Claiming Eneterprise2.0-friendliness

• If your product is reminiscent of Sharepoint or WebSphere or any other collaboration platform from the Microsofts and IBMs of the world, you will not be able to sell above SMB level. Plug into existing platforms, don't re-invent the wheel, and don't think for a second that one of the behemoths of software will not throw a couple of millions into their own product and not knock you out of the market. Integration through Federation and Synthesis is key.
• At the moment, hosted solutions are a huge turn-off for institutions dealing with SOX compliance - this is pretty much every Bank and Financial Firm.
  
  Banks and Financial Firms will never agree to storing internal anything but throw-away data on the vendor's servers. This is hardly the penetration that the Startup should want. Instead, build an Enterprise Appliance. Sell something that can be brought into the intranet so that data never leaves or enters the firm without absolute and granular control.
  
  Will this story change in the next 3-5 years? Probably. SaaS is just too good to let up. Managed services make financial sense -- they just make the "big boys" very nervous, especially when dealing with unseasoned and unproven vendors.
  
  Appeasement till Transition is key. Changing culture and mindsets around corporate assets is extremely tough. There is a tipping point though. To reach critical mass you have to prove value without being too radical in approach. Solve small problems well, integrate, piggy-back, then make transition appealing.
  
  
• Expose APIs, develop to a Plugin Architecture, expose ALL settings for run-time configuration. If a setting is locked, disable or simply don't show the setting in the Control Panes.
  
  At some point, I will talk about Thin Platforms and how and why these can safely be Open Sourced without disrupting existing revenue streams.
• Stop popping up alerts that notify me when something new happens. If this feature is a must have, please allow me to turn it off or pipe the output to some other service that can control the disruption caused to my very busy work-life.
  
  For example, it doesn't make sense for RSS readers to pop up alerts telling me about the new feeds that were synced to my desktop. The whole value proposition of RSS is that I can check these any time and therefore don't want to nor care to know that I have yet another post to read. I have good old email for that.
  
• Provide Beginner and Advanced modes that toggle the verbosity or amount of detail/options in configuration panes. Exposing as much as possible to runtime tweaking is great but it scares the Average Joes. Most Corporate IT will set the best defaults and lock the risky ones. No need for the end-user to see everything but the most obvious and necessary settings.
• Be aware of how many mouse clicks or actions it takes to get to a feature that makes your product's Top 10 features list. If users can't find it in 0 to 1 clicks, most just won't use it.
• White Labeling. It has to be very easy for institutions to impose their own brand and styling to anything that has a front-end.
• Pictures and Video Tutorials please. Corporate IT has to train it's end-users in large quantities, quickly and cheaply.
  
• Understand Single Sign On, support it. Application based ACLs are more powerful than HTTP level authentication when SSO is in play. Allow LDAP-derived and ad hoc groups/roles when exposing or protecting information owned by your service.
  
• If you expose RSS feeds, expose URL parameters that filter, scope, limit and style your feeds.
• For any concrete web pages that are served up, allow URL parameters that will hide headers, footers, sidebars. The Thin Integration this enables is extremely powerful.

That's all for now. The list can and should grow into a Checklist or a Guide of some sorts. Please feel free to comment, argue, correct, or add to this list.