The world of enterprise software has seen several innovations in computing architectures. It started with the mainframe, which created a way to automatically perform complex calculations. The minicomputer eventually came along to overthrow the massive mainframe. Then the reign of the minicomputer was toppled by PCs and the client/server architecture. Today, the disruptive innovation in enterprise software is cloud computing and the multi-tenant architecture.
At the moment, a lot focus on cloud technologies centers on the ability to access software via the web. While this is an important innovation in enterprise software, it’s not entirely new nor is it the only innovation of cloud computing companies. Web access isn’t the only thing that’s contributing the to rapid growth of cloud companies like NetSuite. After all, many software vendors have web-access to their software.
In my mind, there are three other innovations that I see cloud companies bringing to enterprise software.
1. Cloud Companies Are A Talent Magnet
There’s something irresistible about working at a hot tech company that’s a market underdog. Although cloud technology is garnering a lot of attention, many cloud companies are still in the start-up phase of their business. The status as market underdog, in addition to a culture of innovation, is attracting some great development talent to these companies. Because these companies are young and growing, the talent that’s drawn there has room to grow and make a discernible impact on the company. But cloud companies have one more thing going in their favor that’s attracting great talent – most companies are writing new technologies from scratch. It’s a proposition that many engineers and developers just can’t beat.
2. The SaaS Model Changes Software Consumption
In addition to attracting great talent, cloud companies are also changing the way enterprise software is consumed. One of the most obvious innovations in this arena is the use of the subscription pricing model. Subscription pricing has made enterprise software more affordable to the masses. It’s changed a software purchase from something that needs CIO approval to a simple line item within a department’s budget. Subscription pricing has enabled another innovation – paying for a software license by credit card. A decade ago, it was completely unheard of for a buyer to pay for their license with a credit card. Today, it’s fairly commonplace. All of this adds a level of democratization to the consumption of enterprise software.
3. Employees of the Dotcom Era Are Web Savvy
In addition to producing some fantastic flameouts, the dotcom era also spawned companies that completely changed the web as we know it. Many of the employees at cloud companies today grew up in the time period when Amazon was completely altering commerce and Google was creating a more intuitive way to sort information and surf the Internet. As such, these employees have grown up with an understanding that the web can be used for business. They’re completely comfortable using the web as a sales and marketing tool. Without a legacy marketing branch holding them back, they’re actively pursuing software buyers online where more and more buyers are conducting their research. As this trend continues, cloud companies are waiting in the wings to deliver.
These are three of five ways that I see cloud companies innovating in enterprise software. To see my other ideas, you can view my original article that was post on the Software Advice website. The original article be found at: It’s Not About the Web Browser.
