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Reprinted from Keep the Joint Running.
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ManagementSpeak: Whenever you shift to a more technologically
advanced program, some things inevitably get left behind in the process.
Translation: I ignored the experts' advice and what my customers
thought, and went ahead because I want my name on some hot-looking
technology.
This week's contributor paid attention to political advice and decided to remain anonymous. |
Professor Irwin Corey would understand ...
The "World's Foremost Authority" once explained, "Today we're going
to talk about the universe. Why? Because there isn't anything else!"
I'd hoped that when I deconstructed Nicholas Carr's paean to Cloud computing -- officially titled The Big Switch: Rewiring the World, from Edison to Google but more properly titled The Joys of Griddish - it would put an end to the nonsense (see "Carr-ied away," KJR, 2/4/2008).
Instead, Newsweek has solemnly declared it to be one of the 50 must-read books of 2009 ("What to Read Now. And why," 7/13/2009).
Never a very precise term, "Cloud computing" has entered that phase
of technology hype where, like Corey's universe, there isn't anything
else. Hosting? It's the Cloud. Software as a Service (SaaS)? Likewise.
Outsourced data centers? You bet. Virtualized servers inside the data
center? Of course.
Which means I have to revise my prediction that Cloud computing
won't turn out to be all that important. Here's my new geometric-style
proof:
1. Definition: Cloud computing now means everything.
2. Definition: Something is a subset of everything.
3. Axiom: At any given moment, something is important.
4. Conclusion: At any given moment, something about Cloud computing will be important.
And yet, in spite of the Cloud's new, tautologically inevitable
significance, Gartner was recently surprised ... that's right,
surprised ... to discover that SaaS -- a Cloud centerpiece -- is going
nowhere, due primarily to high cost of service, difficulty with
integration, and technical shortcomings ("Gartner finds lukewarm response to SaaS," ZDNet, 7/8/2009).
Why do these surprises happen so often? Blame propanethial-S-oxide.
It's the chemical in onions that makes you cry (on contact with tears
it forms sulfuric acid) -- the reason so many people fail to peel the
onion very far.
That's the problem. When viewed from 100,000 feet or so, SaaS and
other Cloudy ventures look just like panaceas to all of IT's problems
(or else they look like Snoopy, except when they look like a croissant
... but I digress). Get close to a cloud, though, and it turns out to
be fog.
Back to our nebulous, unpeeled allium. From 100,000 feet, this syllogism looks solid:
Major premise: salesforce.com sells a lot of licenses.
Minor premise: salesforce.com is an example of SaaS.
Conclusion: SaaS will sell a lot of licenses.
Peel the onion a few layers (or, descend from the clouds to ground
level ... we have a lot of metaphors floating around in this column)
and the fog lifts. Salesforce.com sold a lot of licenses because:
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Commercial CRM packages like Siebel cost a lot and were
chronically mis-implemented as sales management solutions instead of
sales effectiveness solutions.
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IT hated Act! because sales professionals insisted on using it
instead of the expensive CRM package, violating IT's desktop lockdown
policies. (The sales professionals had the temerity to want something
that helped them, for example, sell.)
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Salesforce.com had an interesting property: The need to integrate
it into the rest of the applications portfolio was generally quite
limited. It succeeded as a point solution.
Which meant the VP of Sales could authorize the purchase of
salesforce.com licenses and IT need never know it happened. Even
better, by buying the licenses a few at a time the implementation could
be hidden as an operating expense, avoiding the capital approval
process. Anyone who has been through the ordeal knows that, as
practiced in most companies, the capital approval process is or should
be banned by the Geneva Conventions.
That's the trouble with pundits like Carr and some Gartner analysts
who have never had to do the work. They don't know how decisions get
made in real companies, let alone understand the nasty details of
engineering needed to turn their so-called visions into working
technology.
And yet, pressured by the need to have the Next Big Idea, they write
influential articles and books about How Businesses Will Behave,
thereby pumping up entire industry segments to ridiculous levels.
Ridiculous? Here's just how ridiculous. As of this writing,
salesforce.com trades at around 35, which is roughly half of its
52-week high. Even with its price cut in half, its price-to-earnings
ratio is a stratospheric 88.76, far above the clouds. And
salesforce.com is probably the most successful SaaS vendor in the world.
Had Carr, Gartner and all the other Cloud-promoting pundits subscribed to Keep the Joint Running they'd have known better. Maybe if I'd called it a Cloud computing service they would have.
Robert
Lewis is president of IT Catalysts, Inc., a consultancy focused on
improving IT organizational effectiveness and integration with the
enterprise. Contact him at
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Copyright 2009, IS Survivor Publishing, all rights reserved.
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