Saturday, August 15, 2009

Just keeps getting better

Comments by Nicholas Carr (IT skeptic/critic/expert) and Hal Varian (Google's chief economist) got me thinking about enterprise applications, and why there haven't been any real killer apps for the enterprise for quite some time (since ERP?).

Hal Varian is a very impressive guy, with some very impressive thoughts, who appears to be be appropriately credited with perfecting a bunch of Google's algorithms and using them to drive business strategy. In the interview linked above, he commented a bit on data, it's value, and scale. Enterprise apps contain huge amounts of data, and the amount is continually growing. Strangely, much enterprise data is redundant - for example, when a business buys something from another business, both businesses capture the data about the transaction. Unlike in the consumer world, very little of the data is really analyzed in a way designed to increase knowledge, wisdom, drive strategy, or create value in any way. Using the example I just cited of a B2B purchasing transaction, the data is used to ensure the item is created, shipped, billed for, collected for, commissions paid, ledgers recorded, income tax paid, financial statements updated. The process is called "order to cash," and that seems to be the beginning and end of it - when "cash happens," that's pretty much the end.

Nicholas Carr's argument, in the link above, covers a lot of ground, but the really killer comment is:
"Ultimately, on the network, applications win if they get better the more people use them." [His italics]
Wow! That really got me thinking. Can you name an enterprise application that gets better the more people use it? And by better, I mean "better for the user." CRM may get better for the manager, and Purchasing might get better for the CFO, but does your CRM application get better for the sales or service person as more sales or service people use it, or as one sales or service person uses it more? Does your Purchasing application get better the more people request Purchase Requisitions?

I can think of only a very small number of enterprise applications that get better the more people use the application. SAP's Community Network (SCN) gets better the more people use it, because participation captures and propagates issues, solutions, and ideas. I'm sure SAP gets revenue because of SCN, but it is presumably hard to prove that fact. However, SCN is a community with a bunch of software supporting it, not an enterprise application per se.

Lithium is an enterprise application very similar to SCN - it is a SaaS system that creates communities ("Customer Networks," as Lithium calls them) for issues, solutions, and ideas. Lithium's customers can also cross-sell and upsell items to their communities within Lithium. The more users, the better this application gets.

LinkedIn also gets better with additional use, up to a point. However, LinkedIn is perhaps more vitamin than migraine medicine, and people always pay more to solve a real problem than for a "nice to have." SuccessFactors would see to have the potential to get better with use, but capturing job descriptions, relevant objectives, review language, and other related data, although I'm not sure if the system really does this. Probably some enterprise knowledge management tools get better with more use, although many of them seem to get overwhelmed when the use reaches even a modest level - you can't find any item because it is obscured by many near misses.

Think of all the enterprise applications you know - do any of them get better with additional use? Do they mine data to project trends? Do they capture text to predictively enter it for you next time? Do they alert you when data show a pattern from the past (like a customer becoming a bad credit risk, or an employee preparing to resign, or a competitor gaining an advantage)? Do your enterprise applications get better with more use?

Shouldn't they?

If you can think of any enterprise applications that get better with more use, please leave me a comment mentioning the application and how it gets better with use. Thanks!


  1. Dennis - Just discovered your blog through your post on Esteban Kolsky's. From my perspective in enterprise software support and services I believe that the way to make an application better with use is not only a technology challenge, but also a people and process challenge. One of the clearest examples of increased value with increased use is KCS (Knowledge Centric Support) that attempts to mine information recorded during customer support interactions and convert it to explicit organizational knowledge.

    Thanks for an interesting post and the opportunity to respond,


  2. Haim -

    Thanks for the comment. Knowledge management apps in general can get better with use, as long as they are able to provide good filtering. Lithium, btw, is a "KCS."


    - Dennis