Chris Dixon

Chris,

What you mention above is very much correct.

my take is, in enterprise product the entrepreneur can seldom boot-strap. the enterprise sales process is generally much longer (tedious) than selling a consumer product. So, the ratio of effort (investment) is sales is much higher than in the consumer facing products. The above means that much of the effort is directed towards the sales cycle rather than innovation. 

having done entreprise product startup and selling it to some of the biggest fortune 500 companies. we still failed because we did’nt have the sales muscle. 

–
Deboprio

It seems like there’s an assumption here (and in the comments) that bad UI in products is a graver problem than it actually is.

It’s all about helping achieve business goals. Making employees happy is one important goal, but not the only goal.

… with possibly the exception that as as enterprises get bigger (I deal with predominantly public sector), then a third party gets involnved – the ‘procurement pro’, which outflanks both user AND IT.

Your corollary is a valid point however – I come from a sector (ironically, in healthcare) where IT have traditionally been excluded from the process. I know of IT departments being told – we’ve spent 3 million quid on a system – its arriving next month and we need a seperate network for it to run.  The issue there is that the users making that decision have no (ok maybe little) cognizance of the needs of ‘other’ users around the enterprise.  Thats the REAL job of IT in the enterprise.  The result then is small pockets of info-islands with little joined-up thinking.  More than a decade ago I was horrified that I could travel the world, stick a piece of plastic into a hole in the wall and pull cash out, but hospitals were unable to refer to a single patient with a single identifier (it still happens).  The reason is a disconnect between the needs of the individual user and the needs of the enterprise.  The answer, if cloud is going to sideline the IT  department has to be a change at C-level with perhaps the CIO becoming more business-process-oriented rather than leaving that responsibility to individual analysts – who aren’t in the frame anymore. 

But then thats where cloud has an achilles heel when it comes to enterprise – being able to share information across the enterprise. I can’t say for sure but I strongly suspect one of the reasons G! abandoned Google Health was the requirements for importing and exporting information – not on a one-off basis but in real-time.  Thats a challenge that service-oriented platforms can cope with but commodity players can’t.

For companies wanting to try the “end-around” approach to the enterprise buyers I’d offer three pieces of advice.

1 – Make sure your product has awesome UI/UX AND performs at a high level.  There is some stiff competition out there and looks along won’t get it done.  The looks are needed to help the users fall in love but you ultimately need to do something important significantly better, faster, easier for the user than their set of corporately-sponsored alternatives.

2 – Either make it completely self-serve (web-based) to adopt at scale or get some very good salespeople in place that can avoid getting sucked into the trap of perpetually believing they are “almost there”.

3 – If you do “cross the chasm” from early-adopter users to a purchase by the broader organization, your work isn’t done.  You need to work back with your early adopters and find the specific use cases where your product shines for that customer.  Work with the central IT people to ensure a successful deployment based on these use cases and drive rapid adoption.  People have work to do and they’ve been doing it one way for years.  Make it dead simple to adopt your product and actually deliver on all the “soft” (productivity) cost-savings you’ve been promising.  This is the difference between making one sale and cultivating a customer that will buy more in the future and can serve as a valuable reference in the meantime.  Make them look good internally and they’ll actually take your calls when your premium version or portfolio expanding offering is ready.

Chris -

For enterprise business software sales (SAP, Oracle, etc), IT is rarely the buyer, more often they are gatekeeping and limiting what can get in the door.  To the extent that the cloud bypasses them, that is great.

Every business of any size has pretty strict rules about which applications can be used with company data.  And even where that is not true, there are often restrictions on reimbursement, limiting the ability (or willingness) of random sales guys to use SFDC instead of the Oracle/SAP/MS product installed for the entire team.

-XC

Chris: Great topic and of special interest as we’re launching a cloud-based enterprise software startup in NYC next month. Here’s why I think most enterprise technology sucks and why there’s not enough innovation:

- Experience: A lot of entrepreneurs have never worked inside a corporation . Instead, they end up trying to solve B2C problems. That’s why we have a million food and dating apps but so few good payroll apps. My experiences working inside global ad agency WPP for seven years has resulted in two successful startups because of the things I saw and wanted to solve.

- Design: Solving UI problems for B2B software is often more
difficult than for consumer apps because there are so many more steps in
the process and much data to display. It doesn’t mean that it can’t be
solved, but it requires very strong architecture and design talent.

- Capital: A lot of VC’s (but not all) are looking to invest in startups focused on building large networks of connected consumers. They want a sexy, consumer-based “home run” even though B2B software can offer similar, if not more reliable, exits.

- Appeal: Some (but not all) people think that B2B software is boring. Just read the TechCrunch article on SuccessFactors acquisition to see what I mean. Articles like that are an insult to people who working on solving B2B problems with software.

Best,

Matt