Sunday, March 31, 2013

Maybe, There Are No Systems of Engagement

A couple of years ago, I took part in an AIIM project that was examining the recent changes impacting enterprise software systems - consumarization and mobile, social, and cloud based software. Spearheaded by none other than Geoffrey Moore (yes, the one of Crossing the Chasm fame), we ended up defining the terms systems of record and systems of engagement. You can find the AIIM paper by Geoffrey Moore here.

Geoffrey Moore
Since then, the terminology of systems of record and systems of engagement entered the mainstream nomenclature and it is used regularly in various discussions. The systems of record are the traditional (yes, old-fashioned and boring) applications that enterprises have been relying on to manage their critical information. The systems of engagement are those hip, new applications (with, ehm, sometimes questionable ROI) that were supposedly the future of enterprise software.

But the more I think about it, the more I’m convinced that we got it wrong back then. When I look at the current landscape, the traditional enterprise applications have all taken on the aspects of systems of engagement. Pretty much every application has a mobile story. There is no mobile enterprise software market. All decent enterprise software has mobile capabilities today. Most enterprise software vendors have added social capabilities to their software. Many of them have launched their cloud initiatives. In fact, I am not sure that there are many viable systems of engagement left out there. Even the vendors who started in the systems of engagement world are rushing to add some of those boring system-of-record features like a repository, security, and governance in an attempt to look more like true enterprise software.

Take the Customer Experience Management market as an example. Those were supposed to be the ultimate systems of engagement - the web based applications engaging with the company’s customers, partners, and employees. But to a Chief Marketing Officer (CMO), these applications are not just about engagement. They are about leads, opportunities, and deals. The Marketing department is being measured by the strength of the pipeline and the opportunity-to-deal conversion ratio. To the CMO, these systems are his systems of record as much as systems of engagement.

In reality, there are no two separate worlds. No systems of record and systems of engagement. What used to be referred to as systems of engagement are a new set of capabilities that have, greatly improved the traditional enterprise applications. When done right, they can significantly augment the usability and adoption rates of enterprise software. But they are not a separate market. They are features.

There is only one type of enterprise software - systems that manage enterprise information.

Monday, March 25, 2013

The Maslow's Hierarchy of a Strategic CIO

Not that long ago, IT departments were responsible mainly for making sure that knowledge workers got access to whatever information was available and for keeping the lights on. That latter responsibility was all consuming. PCs and enterprise systems were still going through their growing pains and varieties of system failures were all too common. The job of the chief information officer (CIO) was more about troubleshooting and firefighting than anything else. Information Technology (IT) was simply a cost center - just like travel or communication.

Well, things have changed. The systems we work with are, for the most part, reasonably reliable. We don't have to reboot our PCs twice a day just to flush out the memory leaks. 99.999% uptime is not that big of a differentiator for servers, routers, and switches anymore. Users don't call the help desk daily and access to information is not the challenge at hand. Today, we have information. We have a lot of information. In fact, we have way more information than we could ever consume.

Herein comes the change in the mission of IT departments. As organizations came to realize that information emerged as a key source of competitive advantage, they were increasingly looking at their IT departments as a key stakeholder in corporate strategy. All of the sudden, the CIOs got what they were always dreaming about. No longer the troubleshooter, no more the firefighter - the CIO is now the strategist.

What organizations need is the ability to make better decisions - using the right information. They need insight. They also need to apply information to create an impact on their business - to grow revenue, attract new customers, enter new markets, and generate innovation. And finally, they also need to drive productivity and continuously optimize their business processes.

Not to forget, enterprise information must also be secured. As it represents significant intellectual property, it has to be protected from intentional or unintentional misappropriation by internal or external actors. And let us not forget the need to address compliance and information governance requirements and to protect the company from legal exposure.

All these requirements reminded me of the Maslow's Hierarchy of Needs and so I have attempted to map the CIO needs into a similar model:

With all of this, the strategic CIOs have their hands full. They still need to keep the lights on but now, they are major stakeholders in defining corporate strategy. Combine that with all the new technology trends such as mobile devices, social software, and cloud computing and you get the picture of the magnitude of their challenge. But I guess that being strategic is way better than fighting fires all day long, right?

Tuesday, March 12, 2013

ECM - Fish or Fowl?

Enterprise software companies usually fall into one of two main categories: application software and infrastructure software. The common wisdom suggests that enterprise software vendors are either building infrastructure that enables multiple applications to operate or they are delivering applications that solve actual business problems.

ERP is a typical application software. The ERP applications solve specific business problems such as how to optimize the use of enterprise resources, how to accelerate HR processes, or how to reduce the amount of materials in stock without slowing down production.

Platforms such as operating systems, databases, and application servers are infrastructure software. Communication software ranging from EDI to messaging, file transfer, and email is infrastructure software. Virtualization software and administration/management software are infrastructure. Infrastructure does not solve any particular business problem - it can be applied to solve any number of them.

That begs the question, what is enterprise content management (ECM). As it turns out, ECM is rather unusual. Unlike almost any other enterprise software category, ECM can be deployed as infrastructure or as applications. Many customers I have seen, have deployed their ECM as a platform with multiple applications built upon it. They clearly consider ECM part of their infrastructure. Many customers have also deployed their ECM at the heart of their information sharing, archiving, or retention infrastructure. Gartner assigned ECM to what they used to call the Knowledge Worker Infrastructure category. There is no doubt about it - ECM is infrastructure software!

Yet, there are many deployments of ECM software devoted to applications - solutions for very specific business problems. Examples include contracts management, early case assessment, invoice processing, customer onboarding, plant asset management, digital marketing, and technical publishing - to name just one example for each of the seven types of content applications that I have introduced in my recent blog post. These deployments are not infrastructure, they are applications. Clearly, ECM is application software!

That makes enterprise content management quite unique - it can be deployed as an infrastructure and it can be used as an application (or multiple applications). There is hardly any other enterprise software category that comes with this level of complexity. The only other category I could think off is business process management (BPM) - a software category that shares a lot of synergies with ECM.

This uniqueness may explain some of the identity challenges that ECM has been having over the last two decades. Who owns ECM? Who’s in charge of the ECM architecture in the enterprise? The answers have never been very clean cut. Depending on the organization, the ‘owner’ may be in IT or in any number of corporate functions.

Most enterprise software vendors fall clearly on one side of the dividing line - they are either application vendors or infrastructure vendors. They may attempt to reach across that line, but their DNA is usually pretty hard-wired. SAP is an application vendor. VMware is an infrastructure vendor. IBM doesn’t do applications. Salesforce may claim to be a platform but it is really an application with the ability to be extended by add-ons - nobody would refer to their SFDC deployment as infrastructure. There are hardly any mixed vendors outside of ECM.

OK, people usually mention Oracle as a company that provides both - database software (infrastructure) and application software (ERP, CRM, etc.). That is true. However, Oracle has gotten to this point via a very aggressive acquisition strategy and its database, middleware, and application businesses are operating independently from each other. They are effectively several enterprise software companies under a single brand.

I believe that we have to accept the fact that ECM may mean a completely different thing to different people. It doesn’t make it any easier to describe (or sell) but it also makes it a much more exciting market. The versatility of ECM is something that both the vendors and customers often appreciate.

Because, ECM is unique!