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Realizing the True Value of Your Software Applications

By Michael Schrage

April 15, 2006 — CIO — Success can be a trickster; be wary. While I was moderating a customer advisory board workshop for the software division of a giant technology company, a disturbing observation dawned on everyone in our poorly air-conditioned conference room: The software we were all there to improve could do much more than even its most loyal users dreamed of, yet that extra capability was almost never tapped.

The division’s leadership heard story after story of how their software did a terrific job of solving one problem, yet was never considered as a possible solution for any other business problem. Somehow, the software’s early success had branded it a useful "point solution" rather than an innovative platform for an array of apps. For example, while the software was superb for both mass and custom distribution of e-mails and PDFs, it could also handle global distribution of richer media formats—streaming, for instance. But clients were not even aware of the greater capability. In fact, this server software, with minor modifications, was explicitly designed to deal with the bulk of the business and technical issues its users had deemed critical.

Why did early success blunt enhanced adoption? Communication was part of the problem. People just didn’t see the links between digital formats, and the vendor didn’t know enough about its customers’ specific business needs to point out how the software could address them. While it was true the software would have to be tweaked to custom-support specific needs, the vendor actually had tools that made customization cheap and easy. But again, the customers didn’t understand what was available.

Bottom line? The software was a victim of its early success. The customers clearly liked it—why else join the advisory board?—but the package was woefully undervalued and underutilized. The point solution perception actually undermined its potential as an enterprise business process platform. Oh, the irony! The software had been unfairly "niched."

At a major software company’s CIO conference barely a month later, it was d¿ vu all over again. Fortune 1000 IT leaders took turns telling their host’s senior management that the vendor’s enterprise software was underutilized. Business process owners and line executives inside their companies kept looking for alternate software solutions to business needs when the vendor’s existing software could accomplish most everything required—and more.

"You need to make it easier for us to utilize all the software we license from you," one CIO told the vendor hosting the conference. "Otherwise, our people are just going to go out and buy the software they think they need from someone else."

 

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