Wednesday, April 16, 2008

When is open source like Starbucks?

When there is a premium placed on customization. This morning I am getting some work done in a local SBUX waiting for traffic to die down and I see a stream of people willing to come in and pay two to three times the price for a cup of coffee from the competitor across the street. Why is that? Customization.

I watched a special that featured SBUX on television the other night and their VP of Brand stated that there are 80,000 possible combinations of coffee using their standard menu. Starbucks understands that people will pay a premium to get exactly what they want.

This can be applied to open source software where the premium isn't always a financial one. It could be the investment you have to make in your IT force to educate them in other lines of software or understanding that your IT services need to change in order to better server the organization as a whole.

Companies will not only pay more for better service but they will do so gladly. What they resent though are sky-high fees for licenses, maintenance, insurance, proprietary audits, and the like; and then being asked by those same software companies to sign on the the line which is dotted for another three years.

The open source companies are here today and are open for business.

You want extra whip on that?

Thursday, April 3, 2008

The world is flat but business is vertical

When it comes to solving large enterprise IT problems we typically offer solutions for the usual suspects: Healthcare, Financial Services, Oil/Gas, and Telecom. If we offer software, services, and training to fix problems then why do we do this in silos? I am sure that most industries face the same exact issues: speed of transaction, security of transaction, and getting more out of less.

Instead of selling to vertical markets we need to sell general solutions for specific needs. If in fact open source is the preference for innovation then we can use this new arrow in our quiver to REALLY understand our customer's needs and adapt our software to them while at the same time turning them from just a customer to an open source contributor.

Customers want to hire and do business with problem solvers and not transactional order takers.

Tuesday, April 1, 2008

When good Globalization goes bad.

As more and more financial institutions write off losses in the billions I listen for culpability in the marketplace and I am still not sure how we got in the perceived mess we're in. It sounds as if the basic rule of Economics 101 was grossly violated: do not buy more than you can afford. But therein lies the engine of a free market: borrowing and lending.

But it is now much more complicated because the proverbial pebble in the water has now caused ripples to manifest themselves in nasty ways in China, the Euro's, and all other large investors (read owners) of the U.S.A. It now seems that some of our largest corporations can now be bought "on the cheap".

So now what happens on Wall Street not only affects Main Street but now the transatlantic waterway...