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'Systems of record' give way to productivity apps, says IT guru

Silicon Valley consultant and management guru Geoffrey Moore recently warned delegates at the Sybase TechWave conference that technology was going through another major change. MyCustomer.com's Stuart Lauchlan reports on the emergence of productivity applications.

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He held the IT industry's hand as it was Crossing The Chasm and grounded it as it entered Into The Tornado. So when business thought leader and best-selling management strategy author Geoffrey Moore advises that there's a change in the nature of enterprise IT, it's a good idea to sit up and pay attention.

"Most of our collective history is going to represent a proud past," he declares. "We are moving into a very different future."

It's a future which - if realised - will change the nature of business software applications, including CRM, HR and accounting. "Through the 1970s, 80s and 90s, we have been on a journey of deploying great systems of record," he said at the Sybase Techwave conference in Las Vegas this week.

"It began in the 70s with the mainframe and its bespoke systems. Then we had some of first applications, which were financial and accounting, such as McCormack & Dodge and MSA. In the 80s we saw systems around order processing and then client/server took systems of record down onto the desktop where we saw the first business intelligence (BI). In the 90s, CRM became the systems of record as we were spending like banshees to get new systems in place before the year 2000.

"On 1 January, we woke up and said 'we're full' and we slowed down the spending so that we could absorb it all. When we came out of that downturn around 2004, it became clear that the systems of record were largely done. Will we carry on tweaking them for 30 years? Yes. But in terms of the great driving force, that has receded dramatically. What has become clear is that we are playing in a globalised economy. The great economies will be in Asia. Everyone has had to come to the US to compete until now. The US is not going to get weaker, but a whole lot of the world is going to get stronger. We have to compete in the world. There are people prepared to do what we do for a lot less, so we have to become radically more productive.

"The move is away from systems of record towards productivity applications. Of course this is what we have supposed to have been doing for the past 30 years, but we were lying, it was marketing! We did make the systems of record more productive but they don't make you or your customer more productive. No-one sat down in front of an Oracle or an SAP application and said, 'Wow, I've never been so productive!' You were still a slave to a system of record that puts you through hoop after hoop."

Moore identifies three major changes as the world moves to a new era of productivity and away from transactional applications. "Firstly we move from a compute-centric paradigm to a communication-centric paradigm," he explained.

"Now we start at the moment of user interaction and work back. We start with the moment of truth, when the customer is making a purchase or someone is checking for a lost bag at an airline. You work back from that moment of truth and work out how to inform that moment.

"Secondly we realise that this is not about transactional processing. We're now in a world where the analytical information is more important than the transactional information. We all carry mobile devices that put us in the communications moment of truth. We're not only transacting, we're interacting. It's less about reporting, much more about search. The Google-isation of our personal lives is showing how powerful this is, but the enterprise is the last bastion of not being Google-ised. Thirdly is the move from wired to unwired."

This shift clearly has an impact on the vendor community. "The analytics explosion is tremendous," noted Tom Villani, VP of global alliances and business development at BI vendor MicroStrategy.

"It's not just about having data any more. It's about having the right instance of that data at the right time. We've had to go through a significant architectural investment. Our system of record has gone through a significant shift. Users used to go to IT and say they needed a certain report and it would need this numbers and it would be needed by yesterday. We've tried to create an environment where the system of record is aided by the outside looking in. The user in customer service can take a report, surf up and down and create a report that is applicable and decision-ready information that is available when they want it. It's real-time analytics."

"We see analytics becoming more and more critical to users," agreed Mike de La Cruz, vice president of mobility and industry analytics at SAP Labs. "What they need complements the IT investment, especially analytics in real time. We have Disneyland Paris as a customer. They realised that users needed a way to cut wait times for customers. This makes sense. The less time you wait as a customer, the happier you are. So Disneyland can see how busy the stores are and the restaurants and the shops. Is there higher demand in one or other of them? They can push out the information to staff in the theme parks so that they can act on it. Cashiers can move from low to high demand areas, for example.

"For the past three years, we've worked with 150 of our customers to redesign our CRM. We learned from some very tough conversations. Users have a lot more power today. In lots of these meetings, we see users deciding which applications and which productivity applications they will use. They have to be more analytical, they have to be more communications-centric. It can be frustrating. Users can be fickle. You talk to one group of users who say we don't want that consistent user interface, we want this one. They say 'Why do I have to browse, why not text?' Then you go to another group in the same company and they want to browse!"

In conclusion, Moore declared: "We are taking on a new audience - whether we like it or not. The new audiences are the ones that are the most user-empowered. The enterprise is becoming unwired; our job is to prevent it from becoming unravelled. We can't retreat to the system of record. That won't work anymore."

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