Tag: cloud computing

Going to the cloud is not for the faint hearted

Technology One CEO Adrian Di Marco has strong advice for businesses that are looking at moving onto the cloud

“The cloud is not for the faint hearted,” warns Technology One CEO Adrian Di Marco in describing his company’s evolution into a software as service provider.

“We thought that this was five to ten years away, I’d like to say we got that wrong and this phenomena is happening now.” Di Marco said at the company’s 2014 Evolve conference on the Gold Coast today, “we’ve seen huge uptake in companies going to the cloud.”

A virtuous circle

Responding to that demand meant that Technology One had to redesign their software and update it to the meet the very different requirements of cloud services.

What Di Marco found in moving Technology One’s software onto the cloud was it became easier to identify problems and inefficiencies in his product, creating what he calls a “virtuous circle”.

It’s not just Di Marco’s customers who’ve been through that process, Technology One itself has gone all cloud internally with the company using services like Google Docs and Salesforce.

The aim of moving online is to make organisations more flexible with Di Marco citing the newly reformed Noosa Council in Queensland as being able to get up and running in four months by using cloud services.

Problems with the cloud

Despite being an enthusiast for cloud computing, Di Marco does sees some problems with the cloud, the first being that the term is overused and ill-defined which results in services being mis-sold.

A bigger problem in Di Marco’s view is a ‘gold rush’ has developed around the concept with revenue hungry vendors looking at making money

“IT companies, particularly consultancy firms, have over the last few years seen their revenues decline so to find new sources of growth they are all targeting the cloud.”

“Everybody wants to become a cloud provider, everyone wants to provide strategic services to do with the cloud.”

“There’s a lot of people offering very mediocre ideas, concepts and services.”

The key takeaway for businesses from Di Marco’s presentation was businesses need to be careful about their choices of cloud services providers.

Di Marco’s other point is that cloud services work best when there aren’t intermediaries such as resellers and integrators involved that reduce efficiencies and add costs.

“The cloud is a platform for the future of business,” sums up Di Marco. “Businesses that move to the cloud have an enormous strategic advantage, they can move at a pace that normal business can’t. They can move fast and innovate quickly.”

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Limitations of the cloud

Google Chromebooks illustrate the limitations of cloud computing

Today I wrote a review for Business Spectator on the HP Chromebook 11, describing it as a nice computer that fits the market space left by the demise of the netbook.

For the HP Chromebook 11, its failing lies in the cloud services it relies upon; if you don’t have a reliable internet connection, or you’re on a flight, then you lose access to many of your files.

This isn’t a problem for office use, most workplaces have reliable internet connections and don’t have to worry about interruptions however when you head out on the road, things change.

A particular bugbear is using the device while on a plane, in my case I discovered the files were listed in the offline docs folder but were ‘unavailable’ on trying to open them.

This is irritating early in a three hour flight when you’re trying to get some work done.

At least with flights Google has done a deal with Gogo internet for inflight access which indicates the company has identified this as a problem, although the arrangement does nothing to help air travellers outside the US.

For the moment, cloud based services are great if you have reliable broadband internet access but for travellers things will continue to be problematic.

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Hitting the eighty percent of needs

Cloud computing has changed the way we expect software to work and changed the entire industry’s philosophy.

“I don’t use ninety percent of what’s in Microsoft Word” has been the complaint of computer users for years as they struggled through the myriad features of box software products.

In the days of floppy disks and CDs, software developers tried to deliver as many features as they could; despite the fact that the ordinary user only needed a core set of functions and that most items on the menus went untouched.

The result was bloated, difficult to use software. The cloud computing model changes this, particularly in business fields like accounting software.

Last week saw a blitz of releases from cloud accounting services with Xero, Intuit and MYOB all making big announcements.

MYOB announced a wide ranging product refresh, Intuit their mobile service and Xero its new board directors that point the direction for its US expansion.

A key part of all the announcement was how the services are all boasting of their partner ecosystems developing add ons that improve users’ functionality.

Once consequence of having an army of developers plugging into the product means that companies don’t have to ship bloated packages that have dozens of features that are irrelevant to each users’ needs.

Xero’s Australian CEO,  Chris Ridd, put this well during the week by observing that company aims to “address the basic eighty percent of needs”.

This is the exact opposite of the box software model of the past where vendors would try to pack more features into their products which gave rise to the term bloatware.

Microsoft’s Office package was probably the best example of this massive growth in the product size, with the installation files eventually taking up a full 4.3Gb DVD to deliver something that most people were happy with when WordPerfect 2.0 shipped on three floppy disks.

That change to the software model is a good example of how business practices and methods change as technology evolves; it also illustrates just one of the fundamental changes older software companies are having to deal with as cloud services change their industry.

We can still have all the features we want in a software package, but we’ll just have to connect – and probably pay for the add ons.

Today, we’re more likely to be scrambling to find an add-on rather than complaining about features we don’t need.

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Passion and LinkedIn – how Connect2field went global

Connect2field founder Steve Oronstein tells how a combination of passion, smart investors and LinkedIn helped his business grow.

Passion is the key to building a successful startup business believes Connect2Field‘s Steve Oronstein.

Running an IT support service is a tough game and it was the lessons Steve learned in running a PC service business during his teens gave him the passion to solve some of the industry’s problems and the idea to launch what’s become part of a global business.

“My very first business when I was nineteen was an IT support business,” Steve says. “During that business I saw it was an absolute nightmare being able to manage all those field workers, managing job sheets and invoicing customers.

“I did that for four or five years and then decided I didn’t want to do that all,” remembers Steve. “I started seeing some opportunities to do some work in job management. From the knowledge I had from the problems in the previous business, I could see there was an opportunity for a product.”

Finding international investors

Steve quickly realised there was an international market for that business and Connect To Field quickly caught the attention of global investors, “I would constantly receive emails from VCs about investing the business.”

One day Steve received a LinkedIn connection and the path to being acquired by a larger company started.

“At the time Fleetmatics came along there were two businesses that were looking to acquire the business. That happened through a LinkedIn connection.”

“A request one morning from someone from Fleetmatics wanting to connect with me and wanting to talk about a partnership. That happened very quickly and we were acquired.”

The importance of smart investors

Steve thinks investors have been a critical part of the business’ growth and not just for the capital they bring in, but also for their expertise.

“The key thing in the very beginning was to raise investment from people who could also be mentors,” says Steve.

“I formed a board with five of people with skills in different parts of the business – legal, marketing, sales, technology”

“When we went through the acquisition space it was invaluable having a board we could bounce ideas off and strategise with.”

For Steve, his advice to other entrepreneurs is to be find a problem and be passionate about solving it.

“I was very passionate about being able to provide a solution for my customers and I knew that what we were delivering would add real value to those business.”

“Finding something that you’re passionate is the number one thing and the rest of it will follow,” says Steve.

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Delighting the customer – the new business normal

Peter Coffee, Salesforce Vice President for Strategic Research discusses the new business normal where mobile services, collaboration, community and understanding your data are essential tasks for every manager.

Salesforce’s Executive Vice President of Strategic Reserach, Peter Coffee joined the Decoding The New Economy channel at last week’s Dreamforce conference to discuss the new normal — delighting the customer.

Coffee’s role at Salesforce is to help the company’s potential clients understand the new normals of business life. “It’s a lot of listening,” he says.

In describing the new normal, Coffee is in tune with Salesforce’s CEO Marc Benioff in seeing mobile services as being one of the key parts of how business will look in the near future.

“The fundamental statement is your mobile device is no longer an accessory,” says Coffee. “It’s the first thing you reach for in the morning and it’s the last thing you touch at night.”

“Fundamentally people are mobile centric so we need to rethink our operations.”

Continuing the social journey

It’s not just mobile services that are changing the way we do, social media continues to be companies’ weak points in Coffee’s opinion.

“There’s research that’s come out of places like MIT that shows traditional print and broadcast media are still valuable for creating awareness of your brand but the final step of turning someone from knowing who you are into deciding to do business with you is now made today only when a trusted network confirms it.”

“People don’t make that final step of buying from you until they’ve consulted their trusted advisors.”

“Another fundamental change that’s happened is that the connectivity of the customer is such that if you have a customer that’s unhappy with you for even five or ten minutes there’s a tweet or a Facebook post or a LinkedIn update just begging to leak out and damage your brand,” says Coffee.

“The closer you can get to instantaneous resolution to the issue, the better.”

Internet of machines

With the internet of machines, the ability to resolve customers’ problems instantaneously becomes more more achievable in Coffee’s opinion.

“Connecting devices is an extraordinary thing,” says Coffee. “It takes things that we used to think we understood and turns them inside out.”

“If you are working with connected products you can identify behaviours across the entire population of those productslong before they become gross enough to bother the customer.”

“You can proactively reach out to a customer and say ‘you probably haven’t noticed anything but we’d like to come around and do a little calibration on your device any time in the next three days at your convenience.'”

“Wow! That’s not service, that’s customer care. That’s positive brand equity creation.”

Delighting the customers

All of these mobile, social and internet of things technologies will give businesses the tools to delight their customers and Coffee sees that as the great challenge in the new business normal.

While many businesses will meet the challenges presented by mobile customers and their connected machines Coffee warns those who don’t are in for a painful time.

“If you do not have delighted customers you have no market.” States Coffee, “the way that you delight customers is by making sure every interaction with you leaves them happier than they were before.”

“Traditional silos of sales, service, support and marketing must be dissolved into one new entity which is proactive customer connection.”

“Companies that neglect to adopt it will discover they have customers who are sensitive to nothing but price,” warns Coffee.

Paul travelled to Dreamforce in San Francisco as a guest of Salesforce.

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In business, be careful what you wish for

MYOB and Microsoft wanted the subscription model, but when they got it it turned out not to be what they wished for.

Yesterday’s blog post looked at MYOB’s journey into cloud computing, in some ways this is a good example of being careful what you wish for.

Like all box software suppliers, MYOB and Microsoft desperately wanted to move customers to a subscription model through the 1990s and early 2000s, the theory being a steady cashflow would be better than the ‘lumpy’ sales of box product every time a customer upgraded their system.

Eventually, the box software suppliers got their wish when cloud computing took off after many false starts.

Unfortunately for the box software suppliers,it turned out their products had to be completely redesigned to run as a cloud service.

Worse, the new business model also lowered the barriers for entry into their industries which meant the incumbents had to compete dozens of hungry new competitors who weren’t lumbered with legacy code and customers.

The box software companies got the subscription model they wished for, but turned out not to be the bonanza they hoped.

Wishing well image courtesy of Deboer through SXC.HU

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MYOB’s journey into the cloud

How MYOB is responding to the cloud computing threat by moving their boxed software products onto the cloud

The big winners of the Personal Computer era were the software companies. During that time firms like Microsoft, Oracle and Adobe became some of the most profitable companies on the planet.

With the arrival of cloud computing those profits started to dry up and those software companies that did so well out of the PC era are now scrambling to develop new products to meet a very different market.

Accounting software provider MYOB is a good example of this changing industry – a business that dominated the Australian small business market and supported an army of certified consultants now finds cloud based competitors like Xero nibbling away at their industry position.

MYOB Chief Technology Officer Simon Raik-Allen describes his company’s journey to the cloud in the latest Decoding the New Economy video clip.

“The cloud has amazing benefits for small business,” says Simon. “For twenty-two years we’ve had desktop products and for the last three or four years we’ve had cloud based services.”

“It’s been a really interesting journey, we’ve been on it for three or four years now where we’re converting the company to a cloud company.”

“But it’s also a cultural journey,” Simon observes. “I love seeing how people start to think differently when stuff is in the cloud.”

“Having things in the cloud opens the opportunity for employees to start slicing and dicing data in different ways.”

“It opens up the innovation curve to what’s possible.”

Bringing partners on the journey

Like Microsoft, one of MYOB’s strengths is its partner community – in particularly the company’s twenty thousand strong Certified Consultant program.

Those consultants, like Microsoft’s partners, are seeing their traditional revenue streams challenged as their business models change, a topic discussed with Growthwise’s Steph Hinds in a previous video interview.

“Everybody takes the cloud journey at their own place,” says Simon. “For bookkeepers in particular this is an opportunity to change their business in a positive way.”

“Normally a bookkeeper would drive around and visit two, three or four customers a day and help then with their books. Now they can help twenty customers in a single day.”

Looking beyond the cloud

Simon sees more than cloud computing changing accounting software with connected devices like the Pebble Watch, voice and gesture recognition along with Near Field Communications technology all being built into MYOB and computers in the near future.

“NFC is a very powerful technology,” Simon states. “Imagine in the accounting world where you are doing your books by moving your phone.”

“In retail NFC is going to be big where you can walk up to a product, wave your phone in front of it and it will tell you about the product.”

“We are very much driven by what our clients want,” says Simon. “It comes down to the use case of will it add to our customers’ business.”

An enthusiastic advocate

One of the things that’s impressive about talking with Simon Raik-Allen is his enthusiasm for technology, whether it’s Pebble Watches, NFC enabled robots or gesture controlled accounting software.

MYOB needs that enthusiasm in its move away from the once immensely profitable box software business onto the cloud where margins are thinner, the advantages of incumbency aren’t great and the competition from well funded competitors like Xero is immense.

As with many other ventures, MYOB is dealing with a huge disruption to their core business and the challenges are immense.

Image courtesy of Morrhigan through sxc.hu

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