The End Of Software - Anibal's Blog

Yesterday, I was talking with Marta Cruz, from Nextperience. This is the brief review about the chat (to don't forget it ;-) ):

I've been reading The Innovator's Dilemma, by Clayton M. Christensen. According to the author, it's very difficult for a traditional company to innovate its business. Several examples along history support the idea. E.g. Hard Disk Industry, Mechanical Excavator Industry, and Minimill Steel Technology.

In a legacy business, the value network is built for a purpose. It can not be changed to support a disruptive technology.

When a disruptive technology is taking its first step, it's going to be incomplete, not ready for prime time. The legacy customers are not going to see with good eyes the new idea. Management is not going to be supportive for wasted budget in a new field; refurbished ideas are going to win. The scenario is posed to support projects oriented to "update" old technologies.

So, new technologies are developed by new companies. The new company has no other choice to develop its new business (cutting the old ties). Even with imperfections, the company will find a market to survive. In the mean time, it will improve the innovation to better compete and win new market. At the end, it will surpass the old technology.

SaaS is growing based on new companies understanding how to adapt the software to be selling as a service. It's a paradigm shift. It's easier to say it, than to apply it. (Remembering the ASP Bluff from the .com era)

Traditional software companies have no good chances. They are fighting in a new arena with a legacy structure and narrowing revenues; trying to keep their traditional customers happy, reuse the current bolts, and cutting costs.

If we are standing in a new company with brand new ideas, let's cut the old ties. We have to forget the habits, and rethink the business for the new customer (I'd like the idea of a natural-born digital native). Let's deconstruct the products and services and rebuild them around the digital native.

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