I've been spending some time noodling on enterprise apps and enterprise app stores. Not the most exciting noodling space on first glance, but that's only on first glance.
There's that William Gibson quote: "The future is already here - it's just unevenly distributed." That's not broadly true but I wonder if Isaac Asimov was right that we can readily predict the probabilistic future on a large scale based on mass psychology. Carlota Perez seems to think so.
Based on Perez's work studying four earlier technological revolutions:
"Each revolution comes in two stages: first there is a period of installation of the new and disruption of the old way of doing things. The fact that a substantial amount of the new infrastructure has to be built out before enough income can be derived from its use leads to over investment, a speculative bubble, and market crashes. Every time."
"During the Installation period,the state is pushed into playing a role that is subservient to dominant finance capital, which drives the spread of the new industries by attracting existing wealth towards the stock market. The new entrepreneurs thrive and compete and new leaders and giant industries emerge. The frenzy ends each time with a bubble and a crash."
"Conditions are set for the second period of the technology, namely its deployment stage, where the state comes back into the picture and finance capital is moved back into its basic supporting role. In deployment the technology spread sits benefits from early adopters to the rest of society and the new wealth rather than being concentrated at the top, is redistributed bringing a golden age of prosperity. This period lasts two or three decades until those technologies become mature."
"[Four years ago] Carlota [found] that we [were] in the eighth year of a transition that in the past has lasted anywhere from two to thirteen years."
That puts us near the end of the transition phase. One of the strongest arguments, in my mind, that we are moving into the "golden age of prosperity" - despite all evidence to the apparent contrary - is the rise of enterprise apps and enterprise app stores. Technology that was once an overhyped disappointment is living up to its promise, moving to late-adopter realms that were historically home to the most conservative of consumers.
And it’s also not just mobile – organizations are looking at taking the Apple App Store model backwards, looking at new ways to deliver self-service enterprise PC software in a consumer app-like experience. This consumerization suggest that that organizations will be looking for new ways of partnering with vendors, licensing their IP, repackaging that software, and delivering it to enterprise customers – even in the non-mobile space.
This new model implies competition among enterprise applications, in a space that has been lucrative for vendors because it is relatively less competed. Historically, for vendors, the enterprise is the “fat plum that’s hard to pick” whereas the consumer market is the “crabapple hanging low on the branch.” As everyone knows, bird in hand, etc etc. This is an oversimplification but intensifying competition in the enterprise space is going to turn whole industries upside down – as well as whole institutionalized IT departments. You only have to look at the difference in mobile apps vs. traditional desktop applications – in mobile, a consumer app goes for 99 cents while an enterprise app might be $9.99. In contrast, an Oracle implementation might be $10 million. Even Salesforce can be $1500 / user.
Enterprise consumers need enterprise apps – or to be more precise, enterprise consumers need enterprise apps in a world where they have competitors with access to productivity-enhancing enterprise apps. It is hard to deny that technology is getting better in ways that push out the performance frontier – and if you’re not on somewhere on that frontier, you’re not competitive. Ergo, the advent of “shadow IT”, off-the-ranch purchases by business units and enterprise consumers which accounts for one out of every four dollars of corporate IT spend.
More broadly, this is being driven by expensive labor becoming more expensive, growing scarcity of time and attention, and increasing criticality of “instant on” as the “killer app” – both in hardware (i.e. the iPad) and software (i.e. the app). Mirko Minnich, CTO and SVP of Elsevier Health Sciences said: “I believe every enterprise will ultimately adopt the App Store as the primary model for delivering information in the future.” If you extrapolate that forward and think about the implications of the “app as search” and basic HTML5 apps becoming easier to build, there may come a day when the average person takes tools in hand, and search, social and app creation collide in extraordinary ways.
So, coming back to today, if you were an organization considering an enterprise app store, how would you go about it?
While there's an obvious decision to make as to whether to use a third-party or start from scratch, the critical piece of it really comes down to the governance model and strategy:
There's that William Gibson quote: "The future is already here - it's just unevenly distributed." That's not broadly true but I wonder if Isaac Asimov was right that we can readily predict the probabilistic future on a large scale based on mass psychology. Carlota Perez seems to think so.
Based on Perez's work studying four earlier technological revolutions:
"Each revolution comes in two stages: first there is a period of installation of the new and disruption of the old way of doing things. The fact that a substantial amount of the new infrastructure has to be built out before enough income can be derived from its use leads to over investment, a speculative bubble, and market crashes. Every time."
"During the Installation period,the state is pushed into playing a role that is subservient to dominant finance capital, which drives the spread of the new industries by attracting existing wealth towards the stock market. The new entrepreneurs thrive and compete and new leaders and giant industries emerge. The frenzy ends each time with a bubble and a crash."
"Conditions are set for the second period of the technology, namely its deployment stage, where the state comes back into the picture and finance capital is moved back into its basic supporting role. In deployment the technology spread sits benefits from early adopters to the rest of society and the new wealth rather than being concentrated at the top, is redistributed bringing a golden age of prosperity. This period lasts two or three decades until those technologies become mature."
"[Four years ago] Carlota [found] that we [were] in the eighth year of a transition that in the past has lasted anywhere from two to thirteen years."
That puts us near the end of the transition phase. One of the strongest arguments, in my mind, that we are moving into the "golden age of prosperity" - despite all evidence to the apparent contrary - is the rise of enterprise apps and enterprise app stores. Technology that was once an overhyped disappointment is living up to its promise, moving to late-adopter realms that were historically home to the most conservative of consumers.
And it’s also not just mobile – organizations are looking at taking the Apple App Store model backwards, looking at new ways to deliver self-service enterprise PC software in a consumer app-like experience. This consumerization suggest that that organizations will be looking for new ways of partnering with vendors, licensing their IP, repackaging that software, and delivering it to enterprise customers – even in the non-mobile space.
This new model implies competition among enterprise applications, in a space that has been lucrative for vendors because it is relatively less competed. Historically, for vendors, the enterprise is the “fat plum that’s hard to pick” whereas the consumer market is the “crabapple hanging low on the branch.” As everyone knows, bird in hand, etc etc. This is an oversimplification but intensifying competition in the enterprise space is going to turn whole industries upside down – as well as whole institutionalized IT departments. You only have to look at the difference in mobile apps vs. traditional desktop applications – in mobile, a consumer app goes for 99 cents while an enterprise app might be $9.99. In contrast, an Oracle implementation might be $10 million. Even Salesforce can be $1500 / user.
Enterprise consumers need enterprise apps – or to be more precise, enterprise consumers need enterprise apps in a world where they have competitors with access to productivity-enhancing enterprise apps. It is hard to deny that technology is getting better in ways that push out the performance frontier – and if you’re not on somewhere on that frontier, you’re not competitive. Ergo, the advent of “shadow IT”, off-the-ranch purchases by business units and enterprise consumers which accounts for one out of every four dollars of corporate IT spend.
More broadly, this is being driven by expensive labor becoming more expensive, growing scarcity of time and attention, and increasing criticality of “instant on” as the “killer app” – both in hardware (i.e. the iPad) and software (i.e. the app). Mirko Minnich, CTO and SVP of Elsevier Health Sciences said: “I believe every enterprise will ultimately adopt the App Store as the primary model for delivering information in the future.” If you extrapolate that forward and think about the implications of the “app as search” and basic HTML5 apps becoming easier to build, there may come a day when the average person takes tools in hand, and search, social and app creation collide in extraordinary ways.
So, coming back to today, if you were an organization considering an enterprise app store, how would you go about it?
While there's an obvious decision to make as to whether to use a third-party or start from scratch, the critical piece of it really comes down to the governance model and strategy:
- Will the store include internally and externally developed apps? Will the apps be internal-facing or external-facing?
- Who approves the app and what the criteria – is the bar low (e.g. stability) or high (e.g. usefulness)?
- Who manages the overall curation, curation of the “front page” and branding – if anyone?
- How do you streamline the controls so as not to inhibit innovation?
- Who pays and how do they pay (e.g. expensing, charge to the firm, redemption codes)? How is licensing / bulk purchases handled?
- What is the right balance of control in a world where most “apps” are less than $10?
- How do you institute a two-way dialogue between enterprise consumers and IT?
- Are apps “rated” or evaluated in some way, either through committee or crowd-sourcing?
- Who owns the app? How is it maintained, if at all?
- How personalized / integrated are the apps?
- How do you control access to different groups (internal / external, levels in the firm) and across borders?
- What level of security is needed, and how do you ensure it?
- Do you treat it like a laptop (something to be “turned in” when employment ends) or a legal pad (something employees keep)?
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