Gesture Control in the Enterprise and the Consumerization Chasm

When Microsoft first shipped Kinect as an add-on for the XBox 360, I thought: “Wow, there is a new way to interact with information!” Sure, Kinect was designed for ‘full body gaming’ as Microsoft calls it but the ability to use gestures to find, access and view information seemed very promising. Ever since the 2002 hit movie Minority Report, we are yearning to work with information the way the Tom Cruise character did: using gestures.

The original - Steven Spielberg's Minority Report 

The use cases in the consumer space are primarily focused on gaming and the interaction with entertainment media. Using iTunes on AppleTV or Netflix on Xbox is great but, let’s face it, searching for movies using a remote control with no keyboard is a pain. Gestures could help with browsing the content while voice recognition could solve the typing problem.

Microsoft Kinect

The use cases in the enterprise, though, are far more promising. Just think about the surgeon with sterile hands who needs to flip through a series of X-rays, zoom in, start and pause a video recording from a echocardiograph, and quickly query a drug database. Think about the aircraft mechanic with oily hands who needs to access a repair manual for the latest model of a jet engine. How about the teachers explaining the latest material in front of a class of students? Or the speaker on stage using his hands instead of a geeky laser pointer...or instead of a fork lift like Al Gore did in The Inconvenient Truth? There are many possible professional uses for the gesture technology!

Yet, how come I don’t see any of this in the real life? Maybe Kinect isn’t good enough? Maybe it is sold only through the same stores that sell the gaming consoles and ignore the enterprise? Does Microsoft Marketing perhaps need help? There is a Kinect for the Windows web site promoting a software development kit (SDK) but there are no business examples featured on that site.

Google Glass, those hip looking glasses with a built-in computer screen (and a computer) have a similar potential in the enterprise. There are many professions that would greatly benefit from this kind of “always on display”. However, Google’s primary concern right now is making sure that a lot of celebrities get their picture taken with the Glass on their nose. They don’t even talk about business use cases. I worry now that Google will spend all its energy on devising schemes on how to push ads to people while they walk down the mall. Sure, we have seen that too in Minority Report but, honestly, that part of the movie sucked.

Google co-founder Sergey Brin wearing Google Glass

Microsoft Kinect, Google Glass, and other interactive devices such as the MYO wrist device or the Leap Motion Controller, combined with the Siri-like voice recognition are the future of computing. Touchscreen has its limitations. People have only so much tolerance for the small screen size of a smartphone - which is why the so-called phablets have become so popular. The interaction with a computer of the future will likely not involve fingers on glass but rather gestures, voice and perhaps even thoughts.

MYO is a gesture control armband

While using such interactive devices to browse movies is cool, using them in the enterprise can result in some really powerful benefits. Unfortunately, the leading vendors such as Google, Apple, and Microsoft are all chasing the consumers right now. Consumerization is hitting the enterprise but the vendors only think about the consumers and not about the enterprise. The innovation in enterprise computing is stagnating today and there is a chasm. And where there is a chasm, new opportunities open up for new entrants...

2012 Predictions Scorecard

It’s the end of the year, the time when many pundits like to publish their predictions for 2013. I have already started working on mine but since I am not an industry analyst, I like to first revisit how I did with my Content Management Predictions for 2012. So, here is the scorecard for my 2012 predictions:

1. Big Data will be the hype of the year
Boy did I get this one right! There is hardly a day without some article published about the Big Data revolution. Throughout 2012, Big Data was the solution for the problem - any problem. You take 10 experts and you’ll get 10 definitions of Big Data. In reality, most people started saying Big Data when they just meant ‘data’ or when they meant ‘understanding the data’ which really means analytics. Yet, no conversation could go on and no press article could be written without mentioning Big Data. Big Data became the hype of the year.
Verdict: Hit, Score: 1/1

2. “Social” becomes a feature
This prediction has also come true. Salesforce already had released Chatter last year, now SAP has Jam, and Oracle has different social offerings integrated with the respective applications: Oracle Social Relationship Management, Oracle Social Network, Oracle Social Marketing, etc. OpenText (my employer) ships today OpenText Tempo Social as well as capabilities such as Social BPM which is a social-based decision-making step in a business process. The stand-alone social software market is being rapidly consolidated with players such as Yammer acquired by Microsoft and the once red-hot Jive trading below the level from 12 months ago.

My prediction that SharePoint 15 - now called SharePoint 2013 - would be the catalyst for this featurization of social software has also come true. Well, at least that was the message about Yammer that Microsoft offered at the SharePoint Conference 2012.
Verdict: Hit, Score: 2/2

3. SharePoint will solve every problem, again
My prediction was that Microsoft would freeze the market in 2012, with aggressive marketing of the not yet shipping SharePoint 2013. That’s what happened with every previous version of SharePoint and it was not a stretch to expect that it would happen again. Yet, Microsoft has had a different idea. They have bet the farm on Office 365, Windows 8, and Surface. SharePoint didn’t get anywhere near the attention of the years past. In fact, Microsoft recently increased the pricing of SharePoint by 15% which makes me speculate that they have reached the point of market saturation. This move suggests that Microsoft came to the conclusion that new features no longer help to add new customers. I’ve failed on this prediction as SharePoint is obviously no longer a strategic priority for Microsoft (I’m sure the SharePoint product team will disagree with me but well, my blog my opinion...Besides, I’m losing a point here, OK?)
Verdict: Miss, Score: 2/3

4. Rise of the hybrid cloud
Throughout 2012, it became apparent that the cloud is the way to go. Many original concerns related to cloud deployments such as security have been set to rest. That said, customers are in no rush to move their existing applications, and certainly not existing data into the cloud. That leads ultimately to discussions about what information should reside in the cloud and what should remain on premises. A private cloud is a popular alternative when concerns about issues such as legal discovery and data sovereignty arise - as the public cloud services are usually fairly ignorant about such issues. Finally, I also see that some of the mature cloud vendors developed many on-premises add-ons and integrations - just see how Salesforce is being integrated with on-premises ERP and Marketing Automation software. All of that mix of public, private, and on premises deployments is basically the idea behind a hybrid cloud.
Verdict: Hit, Score: 3/4

5. Cloudy outlook for open source
My argument here was that the cloud would obscure the open source argument - if I’m running my software in the cloud, who cares if it is open source or proprietary, right? On one hand, I stand behind my prediction. Customers using cloud services such as Evernote or Dropbox don’t care whether such services are based on open source software or proprietary code. That said, many of the clouds have been heavy adopters of open source technology, primarily motivated by the need to keep the cost as low as possible. That actually promoted open source to some degree in 2012. Also, my point above about integrating cloud applications with on-premises software makes open source cloud applications interesting for developers again. Hence, this one is a tie.
Verdict: Tie, Score: 3.5/5

6. Consumerization is here to stay
Oh yes, consumerization has taken hold in the enterprise. The new term is “bring your own device” or BYOD. If Big Data was the top buzzword on 2012, BYOD was a close second. Consumerization arrived and it is wreaking havoc in the enterprise. The plethora of mobile devices in the enterprise is actually a much lesser problem than the consumer-class services that are being used by employees with no regard to corporate policies, regulations, legal exposure or compliance. I expect that fixing this issue will be a major source of my paycheck over the next ten years.
Verdict: Hit, Score: 4.5/6

7. End of convergence
My argument was all those electronic gadgets will not be replaced by your smartphone. This is  one that many pundits might disagree with. I’ve been reading about how smartphones are replacing cameras and GPS devices. Yes, they do, when you don’t have a camera handy and forget to bring your GPS! Similarly, the iPad didn’t replace my laptop and I have my little Canon camera always with me. While the Swiss Army Knife is very cool and every guy wants to have one, it doesn’t replace your bread knife, butter knife, and carving knife.
Verdict: Hit, Score: 5.5/7

8. HTML5 won’t kill apps
On November 19th, Apple supposedly reached 1 million apps submitted to the App Store. Those are native apps. There is nothing wrong with HTML5 and it will gain a huge popularity but no, it hasn’t replaced the native apps in 2012.
Verdict: Hit, Score: 6.5/8

9. Tipping point for analytics
Analytics have been enjoying a big buzz in 2012. Mostly because of Big Data - analytics seem to be the universal cure for all aches related to Big Data. In fact, when people say Big Data, they usually mean “understanding the data” and that’s where analytics comes in. Analytics are hot and a lot of innovations occurred in 2012. At OpenText, we've released Auto-Classification - a new product based on a powerful content analytics technology. Other vendors are following suit. Yet, analytics have not quite entered the mainstream as I had predicted. It’s happening but it takes longer and I’ll call it a tie.
Verdict: Tie, Score: 7/9

10. ECM, what’s next?
I had predicted that the industry’s quest to find a replacement term for ECM would continue but that we would stick with ECM yet again. We did. The vendors tried various terms. AIIM’s “systems of record” and “systems of engagement” terminology actually stuck, but it didn’t replace ECM. In fact, even the hip new vendors like Box are now talking about Content Management. OpenText introduced its new positioning leading with Enterprise Information Management (EIM), but ECM remains a key EIM category. ECM is still the term that rules.
Verdict: Hit: Score: 8/10

Well, that’s it. The score of 8 out of 10 is not bad, is it? This has been an exciting year. The convergence of many technology trends continued and their impact on the enterprise started to take shape. 2013 will be even more interesting, I’m sure! I plan to publish my 2013 predictions in the first week of the new year. Until then, Merry Christmas and a happy new year!

Darwin Meets the Innovator's Dilemma - in the Cloud

In his book Dealing with Darwin, Geoffrey Moore - the one of the Crossing the Chasm fame - has explained the difference between the complex systems and volume operations. According to this concept, technology vendors fall into one of two categories. The complex systems vendors focus on a relatively small number of high-value, high-touch transactions that are delivered in the form of sophisticated, customized solutions, usually integrated with other systems.

Geoffrey Moore's model for Complex Systems vs Volume Operations

The volume operators are doing exactly the opposite. They deliver relatively simple, inexpensive solutions through low-touch transactions - no direct sales force but resellers, retailers or online sales. These solutions come with no customization, no integration with other systems, and a limited feature set - one size fits all. While there are many scenarios in between (i.e. small business offerings), Geoffrey Moore suggests the the more a vendor is focused on one or the other extreme, the more effective the business model. IBM and Oracle are examples of complex system vendors while Apple and Google are volume operators.

The most important point that Moore makes is that vendor business models become so optimized for one or the other business architecture that crossing from one side to the other is impossible. Having started on one side of the model, the vendor’s business model, business processes, and key performance metrics are completely hard-wired towards the particular model that makes switching practically impossible.

Geoffrey Moore at an AIIM project

Now, let’s mesh the Moore model with another one - the Innovator’s Dilemma by Clayton Christensen. Professor Christensen suggests that disruptive innovations will always be attacking the incumbents from the bottom up - by providing low-end solutions for the less demanding customers and thus flying under the radar of the incumbent market leaders - until they gain the critical mass and sufficient functionality to challenge the incumbents.

Clayton Christensen's Innovator's Dilemma model 

OK, time to put the two models to work - in enterprise software. The established vendors including IBM, Microsoft, and Oracle are supposedly being challenged by the disruptors coming from the lower end of capabilities - just like the Innovator’s Dilemma predicted. Those disruptors are companies such as Salesforce, Google, Dropbox and others. They all have one thing in common - they are cloud based. But how do they do it when we look through the Geoffrey Moore lense?

Salesforce is a cloud based disruptor that has initially targeted the sales force automation (SFA) market and later the customer relationship management (CRM) market with a cloud based solution. Salesforce has clearly started as a complex system from day one and they have continued evolving in that direction. Their initial customer base were mostly smaller companies and departments but they continued focusing on complex systems - evolving towards more valuable and more complex deployments. Salesforce never had to shift from one side to another on the Geoffrey Moore model. Today, a typical Salesforce deployment involves integration to marketing automation and enterprise resource planning systems.

Microsoft started as a complex systems vendor with enterprise on-premise offerings such as Exchange and SharePoint (note: I’m discussing the enterprise software here, not their Xbox business). To take on the cloud challenge seriously, Microsoft created Office 365 - a cloud based offering that is clearly going in the direction of volume operations on the Moore model. That actually explains why Microsoft uses different branding for the cloud based solution and why they are not particularly worried about the integration between Office 365 and the on-premise offerings. While Microsoft shouldn’t be able to switch from the complex systems model to a volume operations model, they are applying their considerable financial resources to power through those challenges, ignoring the business model altogether.

Clayton Christensen during his visit in Waterloo, ON

Google and Dropbox started as cloud-based offerings focused purely on volume operations - on the consumers. The consumer focus and free price helped them to grow their user base quickly, often infiltrating the enterprise. But the offerings have been clearly designed as consumer software aiming to attract as many eyeballs as possible at the least possible cost. That means basic feature set, no customizations, no integrations, no direct sales force - simply one size fits all service.

While vendors such as Google, Dropbox - and also Apple, Amazon, Evernote, etc. - have a good formula to drive user adoption and even penetrate the enterprise, their business model has been designed to cater to the consumer and not to the enterprise. Enterprises need, I repeat “need” customization and integration with other systems. Just think of managing user lists and groups. Sharing content on Dropbox with your friends might be easy, sharing something with all the employees in Sales or Marketing in your company is much less trivial. You can’t manage all the user groups by hand and thus you need to integrate with other existing systems - i.e. directory services and HR Management system. Enterprise software can do that. Consumer software can’t.  

The consumer vendors might be penetrating the enterprise but today, they don’t have any enterprise offerings.

PS: This post has been inspired by a spirited discussion during the last AIIM Board meeting. I love these conversations with my fellow Board members!