Wednesday, January 23, 2008

The Software Mission

Every year as part of our operational planning exercise, we review the rPath mission statement. We want to make certain that the mission statement is still meaningful, and we want to align our annual plans with the broader objective of the company. Ideally, the alignment of the operating plan with the mission statement is good, AND the mission remains relevant in the industry (the alternative is painful). We also try to improve the wording of the mission statement for greater simplicity and clarity without altering the original meaning. It's an exercise that always sparks a lot of debate regarding the “absolute best” way to convey the mission in words.

As part of the exercise, I like to review the mission statements of other successful technology companies. Before I tell you how our exercise ended, let's take a look at a couple of the ones we reviewed:

Google – To organize the world's information and make it universally accessible and useful.

This is a useful mission statement. It is actionable (“organize the world's information”) and it expresses a specific benefit (“make it universally accessible and useful”). Google sets themselves apart by accomplishing their mission.


Microsoft – To enable people and businesses throughout the world to realize their full potential.

This statement is less specific than Google, and the benefit statement is very broad. Given that Microsoft is such a large company with so many product categories, perhaps over reaching is unavoidable. How do you describe the mission of a company that operates at such a large scale? rPath isn't that big yet, so the question goes unanswered . . . .


Salesforce.com – To create an on-demand information management service to replace traditional enterprise software technology [lifted from Benioff's bio as the company does not explicitly call out a mission anywhere on the website].

Like Google, this statement is specific and actionable (create an on-demand management service”). It also assumes that “replacing traditional enterprise software” is a benefit that is self evident. Given the success of the company, this benefit assumption seems correct - an incredible indictment of enterprise software. The summary statement for the mission,“The End of Software,” has been an effective rallying cry against the complexity and waste of the tradition software model. Overall, I like this statement. It provides the context in which salesforce.com created a new category and differentiated themselves from the competition.

Given this review, where did rPath land? Were we able to describe some noble undertaking that sets rPath apart? Is it actionable? Is it beneficial? Does it matter?

rPath - To simplify the delivery and consumption of software innovation

This is a broad mission statement, but it is actionable and the benefit is self evident – less complexity, more innovation, higher value. We considered being more prescriptive like salesforce.com – calling out virtual appliances, hypervisors, and cloud computing as an architecture to deliver software applications on-premise or on-demand without the hassles of traditional software. We decided that new architecture ideas will present themselves in the future, and being overly prescriptive today might discourage us from embracing change when it comes along tomorrow.

Does it matter? We believe there is no end in sight to the opportunity for simplifying software delivery and consumption. Salesforce.com has blazed a trail that demonstrates that customers will abandon the legacy approach when presented with something that delivers more value with less complexity. IDC estimates that in 2006 over $400B was spent on services for integrating and managing software – almost 2 times the value of the combined spending on licenses and maintenance. And this number does not account at all for the spending on internal staff, which probably doubles an already preposterous number.

If we are correct, the traditional software model is on the verge of an enormous transformation. The value of SaaS demands a response from all ISVs, but the multi-tenant, hosted architecture presents enormous technical challenges for the legacy vendors. Hypervisors replace the general purpose operating system, and ISVs abandon their multi-OS strategy in favor of virtual appliances to avoid an incredible escalation in certification costs across myriad OS/hypervisor combinations. Cloud computing offers a variable cost approach to deliver applications on-demand, relieving ISVs of the expensive burden of building out a salesforce.com-like infrastructure (Jeff Bezos calls it “muck”). And virtual appliances are the new application architecture for delivering applications to customers on-premise (via the hypervisor) or on-demand (via cloud computing).

Given the momentum of virtual appliances, SaaS, and cloud computing, I think it is going to be fun delivering on the rPath mission. Simplifying the delivery and consumption of software innovation is the focus of the entire software world these days. It's better to be in the ring when the bell sounds for round 1 of the prize fight than to be hauling water in the warm-up gym across the street. . . .

1 Comments:

At 12:01 AM, Blogger Adam said...

Hi Billy,

I enjoyed the post. Interesting that you note Salesforce.com's lack of focus on its mission statement. The company seems to favor its tag line "No Software" over direct promotion of the mission statement.

I enjoyed your critique and referenced it in a post on my site.
Check it out via the link below.

Salesforce Times

Best,

Adam

 

Post a Comment

<< Home