Michael Fauscette

Finally got my hands on Google wave...

I was very excited yesterday when I was sent my user name and password for a sandbox Google wave account in prep for a demo / briefing from the Google Wave team (thanks to Sara Jew-lim and fellow IDC'er Caroline Dangson for setting it up). Of course I had seen the announcement and re-watched the video a few times but I still wasn't sure exactly what wave "was" and of course what the experience would be. Face it, I'm a hands on guy when it comes to software, it never really clicks until I can use it to do whatever it's supposed to do. We had a very good discussion with the wave team (Jason Freidenfelds, Jens Rasmussen, and Lars Rasmussen) and had an opportunity to play around with wave among the group (is that called waving?).

So what is it? Well, at its simplest, wave is a designed for the web communication vehicle that spans or combines pieces of all current online communication tools like email, IM, wiki's, blogs, etc. What it's not is a new social network (it is social though, or maybe more precisely collaborative). Wave is more about group and personal productivity than about connecting. They hope, through extensions by in house and 3rd party developers, that wave will become much more though. Think of it as a central gateway to many of your other online tools, so that you would use wave but you could update anything else you choose to integrate to wave (everything from IM or email to Facebook or Twitter). Conceptually the wave team used the idea of conversation as a shared object as the basis for the design. You can, for example, work collaboratively with a colleague on a blog post online in real-time, each typing at the same time and even editing each other as you go (you can see what the other person is typing and each typing stream has the author's name tagged to it)...the end result could then be pushed directly to your blog. The entire session is editable later and saved so that you could replay it and see exactly what was done (not so useful for collaborative blog writing but very useful if you work on a group project and a group member missed the session). It's designed to be synchronous and asynchronous as well so it can be used in an IM-like way and in an email-like way. You can attach files and embedded things like pic's (image drop, which for now requires Google Gears but won't in the future) and maps as well. In a conversation the threads are visible to all the participants and they can reply in the thread. There is also the capability to have a private conversation in the middle of the group conversation. While the interaction is (or can be) real-time there is also a draft a reply feature in case you want to think about what you're saying before sharing to the whole group. The built-in spell checker is contextual (it would know that "Can I have some been soup" should be "bean") and works as you type, giving you a drop down of choices / suggestions when you're wrong.

We did ask about business model and no plans are finalized but they are looking at lots of options. The initial launch will be consumer focused but some of their Google Apps enterprise customers have asked about adding it (so the enterprise model could be an add on to Google Apps which currently costs $50 / user / year). The consumer model could be ad supported or possibly a freemium offering with the option to buy up to a no ad version. There is also the possibility that they may have an "Extensions Store", much like an Apple Apps Store, that would sell in house and 3rd party extensions with Google getting a cut of the revenue. The public beta opens the end of September, you can sign up here.

UPDATE: Feedback from the Google wave team: "we actually already have hundreds of thousands of people on the waitlist, and will be drawing from that existing list for the approximately 100,000 consumers we invite to preview Wave on September 30th. So we welcome new signups, but we won't get to them in that first round. Also, important to note it won't be a "beta" on Sept. 30th -- it'll be just an early preview, with plenty of warts. Not for the pain-intolerant."

Does the emergence of the tech mega-vendor driven economy mean the end of innovation?

I get asked this question a lot, especially since I've started talking more about the emerging mega-vendor economy that is now driving the tech industry. What is the current state of innovation in tech and how is this changing (or is it changing)? The theory goes something like "the big vendors are really just interested in maintaining / growing their maintenance stream of high margin revenue and are not interested in the risk involved in driving innovation in tech."

I was reading Mitch Joel's Six Degrees of Separation blog today on Reinvention, innovation and change and that started me thinking about all the questions on innovation. I think part of the issue is in the definition of innovation. There are two fundamental kinds of innovation that we see in technology, continuous innovation and discontinuous innovation (sometimes called linear and non-linear innovation). Continuous innovation is created in a steady stream over time. Think of it as incremental improvement of a product or service. In software it's tied to the regular release cycle that offers incremental increase of capabilities and features with each subsequent release. Discontinuous innovation is quite different and is represented by disruptive, radical change. It's the new category killer product that leapfrogs the competition and drives significant change and opportunity. Examples of continuous innovation are everywhere in tech but discontinuous innovation is rare. Discontinuous innovation has given us things like the PC, the CD and DVD, MP3 Players, SOA, relational databases, etc. and each of those innovations have themselves been improved on through continuous innovation. The MacBook Pro I'm typing this blog post on today is a product of continuous innovation. You get the idea... So then I'd say that the mega-vendors are in fact drivers of innovation, its continuous innovation for the most part of course, but innovation none the less. Continuous innovation is a part of their business model and an obligation to their customers. You can argue of course that vendor X doesn't spend enough of maintenance on R&D and doesn't release enough new features but not that they are never producing innovation in their product lines.

Discontinuous innovation is a very different thing. I believe that, for the most part, discontinuous innovation has to be driven from the tech start ups. Investing in discontinuous innovation is important but the mega-vendors simply cannot use their resources in the long and painful process of driving this type of innovation. They owe their shareholders higher financial returns and their customers continuous improvement of the products, not disruptive technology. The mega-vendors may be in the position to buy and distribute these disruptive products in the future but rarely will they be the source of the innovation.

Both kinds of innovation are important and necessary for business to advance. The types of innovation work together in most cases to drive business improvement. For example I think that the social web is a disruptive innovation that is now starting to benefit from continuous innovation. The concepts are disruptive but the technologies that are required to make them work are for now, improvements in what we have. Enterprise software that is social enabled will form the foundation of the initial business changes. Don't get me wrong, there are certainly some discontinuous innovations waiting around the corner (or probably sitting in the heads and products of some emerging start ups today) that will accelerate social business changes but I don't believe we can wait for those changes before we start the social business transformation process. There are things that businesses can do today that will provide great return using the tools and concepts we have available. Will the change accelerate and be more impactful with new innovations...I'm sure it will, but can we afford to wait?

Netsuite makes a move to gain additional share in the SRP market by acquiring QuickArrow

Netsuite today announced the agreement to acquire SaaS professional services automation (PSA) vendor QuickArrow for $20M. Todays announcement comes a little over a year after Netsuite acquired SaaS PSA vendor OpenAir. Prior to that acquisition Netsuite had released a vertical solution aimed at the under-served project-based business market. Last Fall Netsuite took that vertical offering deeper with the integration of OpenAir and announced a full SaaS services resource planning (SRP) solution, the first end-to-end SaaS SRP offering on the market. I wrote a post on that announcement here so I won't rehash all of that now. With the acquisition of QuickArrow Netsuite gains additional customers and additional IP that can be leveraged into the main product offering over time. In the more limited PSA market the combined QuickArrow / OpenAir customer share would make them one of the market leaders with over 80K subscribers. The current plan is to leave QuickArrow as a stand-alone product but customers will have the option of migrating to the deeper functionality of the combined Netsuite / OpenAir SRP suite. Netsuite's SRP strategy continues to be:

-move up market with larger enterprise project based businesses

-expand its international SRP footprint

-offer deep vertical functionality with the combined Netsuite / OpenAir suite

The SRP market, even in these tough economic times, has held up as a bright spot in the overall Applications Market.

The Social Solutions Model

I've tried several times to build a model that I can use in presentations to help describe a social business. The graphic above is my latest attempt and I think I may have something to work with this time. A social business can apply the tools and processes to both internal and external activities with significant benefit from both. The tools themselves are not particularly different, at least not at present. I do believe though that this is at best the first generation of the tools and that we will see a significant evolution over the next few years. I think that over time we will see this list of social tools merge into what we currently call enterprise applications, maybe in fact they become socially enabled enterprise applications. We're already seeing this for customer facing tools that are merging into current CRM apps. To get to the scale we will need for enterprise class tools there really isn't an alternative to this progression. Some of the platform offerings already encompass several types of tools in a flexible package, combining blog's, wiki's, community management and microblogs and other collaboration tools. They're basically standalone though and that inhibits realizing all the value out of their use IMHO.

What would embedded social apps (or maybe the term is socially enabled apps) look like? Building from the current apps foundation I think the following is a credible start:

What's the next Twitter of the social web?

  Good question, right? I mean, there's always a "next" big thing in the world of the Internet. It's a little hard to think about it though, seems like Twitter just became "main stream" (well, some might argue, sort of main stream anyway). Its certainly growing like crazy and there are a lot of main stream celebrities so maybe that makes it main stream. I'm also not so sure we've "figured" Twitter out yet. I know how I use it, and I do really like it for all sorts of reasons, but it seems like almost everybody has their own answer for "what is Twitter"? Maybe that's actually part of the point of Twitter, it can be molded to what you want out of it, more so than say Facebook, anyway. One of my favorite things about Twitter is that it is both synchronous and asynchronous, which to me, makes it much more useful than IM or email (partly because of the tacit implications associated with each of them). Think about it, on IM, for example, if you leave your status on "available" then anyone who uses that vehicle feels like they should be able to get an immediate response no matter what you might be doing on the other end. It's really worse than a phone, although many people react to a ringing phone the same way (I don't, I learned a long time ago that a ringing phone may appear urgent but it is not necessarily important, at least not until I know who is calling and about what. I screen and if I don't know the number it's on its way to voice mail). Anyway, you get my point, and that's not really what this post is about anyway (not that I wouldn't enjoy a good rant about how I hate email).

Back on subject, what might the next big thing be? I posted recently on what I think the next gen web looks like, so I guess that's a good place to start looking. I think there are a few factors that could play into it, real time, mobile, location based and video for example. I personally think video is just emerging and will gain in following both in the consumer web and in the enterprise. YouTube of course is the established player but time is ripe for something new here. I've started looking at two newer services that have some potential 12Seconds.TV and Qik. They both support short, mobile (and web / desktop) upload and Qik supports live stream as well. 12Seconds.TV seems, at least now, as more of a consumer play but Qik is clearly looking for enterprise use (they talk about PR, marketing AND customer support). The idea is interesting, I think video will be a significant part of e2.0 / social enterprise as I stated on this blog recently. Video can incorporate some of the other characteristics too, certainly it can be location specific or geo-tagged, it can be streamed so it's real time and mobile as well (the new iPhone 3G S had a big impact on mobile uploads to YouTube, which to me says the audience is ripe to participate).

If it's not video, what else might pop up? Location based social networking is interesting, like Google Latitude for example. Maybe this works better in conjunction with existing networks though, location based Twitter or Facebook, for example. I'm not sure we need a standalone location based networking service, it seems like it would be much more interesting as a feature of an existing network. And speaking about Google, what about Google Wave? There is a lot of buzz still on this one and I personally do like the idea that there is something coming to replace outdated comm / collab tools like IM and email. I think it's still to early to tell though on Wave, but I do believe there is a place for a web native way to communicate and collaborate that is coming soon.

There's also another possibility (OK, there probably are a million others but here's one more), maybe Twitter is the next big thing. I do think we're still "figuring" it out and learning new ways to use it. Certainly businesses are experimenting with Twitter in a bunch of different ways and there's a lot more to learn. Twitter itself is still working on a business model, so who knows where that might lead. Yes, it's possible that Twitter will succeed itself as the next "big" thing...what do you think?

Google Chrome OS, what are they up to now?

I've speculated on the disruptive potential of Google before, and really since then not a lot has changed I guess. Still, as I look at the last few announcements from Google there does seem to be a pattern. I get asked a lot by the financial community about Google and their competitive stance and in general I've said they have potential but they don't seem to be targeting any of the major enterprise players. That's certainly true of Oracle, SAP, HP, IBM, etc. I usually do point out though that it seems like Google has some designs on Microsoft's business and with last weeks announcement of Chrome OS that seems even more likely. Think about it, they have announced, over the last 6 months: 1. A reseller program for Google Apps, clearly a competitor to Microsoft Office, 2. Google Wave, the next gen of web communication and again you could argue positioned against MS Exchange, 3. Google Chrome, its answer to MS Internet Explorer and finally 4. Google Chrome OS... Microsoft's answer, Bing, a shot directly at Google's golden goose. Now let's not be totally off base, Chrome OS, which is targeted at netbooks won't be out till next year and most likely won't do much to disrupt Microsoft's OS business. They did more disruption themselves with the release of Vista, but that seems to be resolving itself with the subsequent Windows 7 release. Some analysts believe that the Chrome OS actually does more damage to Ubuntu, the only desktop Linux that seemed to be gaining traction, by splintering Linux yet again...it's not a bad argument, by the way. Microsoft has also said it was working on a new browser (Gazelle) that would be optimized for running Internet apps, sort of an Internet OS.

Google has a unique position, the ad business on which it lives is fairly stable it would seem and honestly, can another search engine displace them now? Not really likely, just like saying Chrome OS is going to replace Windows 7 on the netbook anytime soon. Just because a technology might be better doesn't often make it the market leader, marketing does...along with inertia. More people are familiar with Windows, there is more device support, etc. All these things make it unlikely that Windows can be displaced...I mean, I'm typing this on a MacBook Pro sitting in a Starbucks in San Francisco (arguably a stronghold of Apple devotees) and as I look around, out of a dozen notebooks/netbooks here we don't represent 20% (1 other MacBook pro, 10 windows, 0 Linux). Not an official poll but a common sight. You have to wonder though, since Google has a stable (and large) cash flow, a bunch of very smart people, an inclination to go head to head with Microsoft and time can they start to damage Microsoft's business? You also have to wonder that if Google became more aggressive in that assault would we be telling a different story, hmmm.

Where do I start my social enterprise project?

  A lot of the discussion, and there is a bunch of discussion going on, around social enterprise is focused on your customers. Makes sense that this would be an area of focus of course, it does provide significant opportunity for your business and seems like the most obvious area to approach first. I'm not sure though, as I look across the opportunities presented by building a social business if I would go for the customer out of the gate. This may be a moot point in many businesses since many e2.0 projects grow out of grass roots efforts that are already happening before the business "officially" embraces the social web and builds a social enterprise strategy. If that's the case with your business then I guess you can skip this post, but if you're thinking about how to approach starting to build a social enterprise read on. If you read this blog you know that I believe a social business has a series of characteristics and that these characteristics come about through significant cultural shift. Many of the social enterprise projects I'm seeing are coming out of marketing, which I suppose accounts for why most of them are customer focused. The other source for many of these initiatives is customer service, again, no surprise these are customer focused as well. But if the real business transformation is about changing corporate culture then I suggest we need to look elsewhere for our first initiatives. In this post I talked about the internal opportunities for building a social enterprise. To bring about culture change you have to approach the change management in a deliberate manner. Taking on established culture while changing the way you deal with your customers may simply be too risky. Changing culture requires demonstrated success through deliberate action. If you can move the corporate culture through a series of internal social projects your overall opportunity for success improves greatly when you do address the customer opportunity. I'm suggesting that you have a much greater chance of success with your customers, while mitigating some of the risk, if you have some internal success first.

How do you go about changing corporate culture? First you need to understand where culture comes from and what your culture is. Corporate culture is the combined attitudes, experiences, traditions, beliefs and values of a business. Culture is developed over time and is a combined consciousness from the individuals in the company. The culture is demonstrated in the way employees interact internally AND with external stakeholders including customers, partners and suppliers. Managerial behavior and the general ethics of the business are manifestations of the company culture. Once the current company culture is defined then the next step in driving change is to define where the company needs to be after the culture change. It's imperative that there be executive buy in for this end state, by the way, which becomes your corporate vision. Once the end state is defined develop specific organizational and behavioral changes that are needed to support the new culture. Tie these changes to the target social enterprise project(s) and reward behavior that aligns with the new culture (and of course conversely call out unacceptable behavior). Publicize success and link incentives to the desired behavior. Change takes time and must be diligently managed.