I’m stealing the headline from Salesforce.com founder Marc Benioff, who is talking about the future of software in rather radical terms. It does of course apply in the traditional sense with the old software licensing models along with the whole apparatus of distributing software, managing updates etc.
The tag line could have been “What will Microsoft do when their core business model is dead?”.
These things has been on my mind for some time now. Especially when it comes to the myriad of technology and product choices I am faced with as part of job. I try to steer towards the a pink fluffy future with total interoperability, interchangability and systems totally built out of composite services. In doing so I often end up trying to decypher the business drivers and philosophies of the companies behind the products we are choosing from.
I felt the need to write something about this as I read an interesting article by Don Tapscott (author of the excellent book Wikinomics) in Wall Street Journal. He is talking about the lack of business model innovation and gives five examples of where he suggests it is difficult or even impossible for the companies to achieve breakthrough success without changing their entire industry’s modus operandi.
Microsoft is an other example that fits into this in a somewhat different way, but maybe a bit similar to the music industry. They too have invested heavily in an old business model which still represent a very significant part of their revenue flow. The possibility to quickly adopt to new business models are seriously crippled due to this heritage from an outdated era. Not only will new business models cannibalize an important revenue flow, it will also bring major changes to the organization itself and all the partners surrounding the old core business. The complexity increases as you try to look at all different areas that Microsoft have a stake in.
In all of this commotion IT-architects have to decide on choices relating to different software or service suppliers, and when to go for the different choices. Building and maintaining roadmaps of changes and of reference architecture is a constant struggle of choosing not only based on the current frameworks and wisely construed models – but also trying to figure out how the company and business model landscape will change in the next few years.
Not an easy task.