by Richard Sykes

Leading the leaders

Dec 27, 2010
IT Leadership

In last month’s column, I wrote about my travels to San Francisco with members of the Leading Edge Forum to scope current developments in Silicon Valley. We met with a range of players from the large and established (Google, Amazon, Salesforce, Facebook and PayPal) to the small and new (Jive, Cloudera and Obopay). I promised more on these three young ventures in this month’s column.

The theme of last month’s column was how innovative commercial models spawned in the Valley. Since the visit, I have seen a fresh example of the impact of these commercial models in IBM’s October announcement of its new portfolio of Cloud offerings.

I attended IBM’s recent Analyst’s Briefing in Madrid as their guest wearing my Bloor Research hat. I consider IBM to be about the only one of the older industry majors who really has a coherent business model in place fit for this new decade – as the industry’s ‘heavy lifter’, capable of marshalling the intellectual and experiential resources required to tackle really complex initiatives such as traffic in cities. The sessions in Madrid served to confirm this judgement.

One break-out session I joined was lead by Christian Klezl, an IBM VP and Cloud Leader for IBM in north-east Europe. I was able to debate with him the IBM cloud announcement as it carries, in my view, the competitive clawmarks of Amazon all over it. There is a Dev/Test facility (‘Time to build a Dev/Test environment from one week to one hour’), a Desktop/Workplace Cloud, a Network Storage Cloud and a Production Cloud for Business Apps. A major business initiative but clearly an Amazon Elastic Compute Cloud (AEC2) me-too. The question has to be why IBM, a world leader in computing, let Amazon, an online retailer, take the lead in introducing the new service utility model?

The further focus of my discussion with the IBM team was whether IBM would stay at the utility end of the market, head to head with AEC2, or whether its real intent lay in its articulation of a family of industry-specific computing clouds.

Another long-standing IBM business is the Lotus suite. Intended originally as a knowledge management tool for the enterprise, it has had a chequered history. Visiting Jive on our tour of the Valley we met an experienced Lotus veteran now vigorously at work for Jive in the same enterprise space, but from a new vantage point. The business of Jive is to enable the enterprise to use social networking tools within the enterprise business environment. The founders of Jive have approached this initially in terms of enabling software tools, but have learnt early on that delivery of their business vision requires people – change-enabling people who can help complex work cultures see the potential of the new ways of working and positively adopt the social networking habits that may be new to them. Bringing the benefits of Lotus Notes into ICI in the mid-1990s was much the same game!

And from Jive to Facebook. Facebook was clear – they have the corporate intranet in their sights. And they are introducing facilities (such as Facebook Groups) that will help to that end. The IT departments of many major corporations ensure that access to the dangers of social networks such as Facebook are blocked on the corporate desktops and laptops. So it was interesting that when the 30-strong delegation of senior CIO/CTO-level players I was travelling with were polled in open session by their Facebook hosts, the vast majority expressed an open interest in bringing Facebook on board.

The more sceptical analysis points out that each new generation of recruits into the corporate world are now so familiar with Facebook that the revolution is inevitable, so let’s go with the tide.

Cloudera was a very different discovery on our tour. Cloudera falls into an emerging category of companies who, in essence, enable the work of open source tools and the cloud for the enterprise. Cloudera enables an open source tool called Hadoop that is about massive parallel processing become more enterprise-friendly. It takes data – mountains of the stuff, structured and unstructured – and it works initially with no preconception of what patterns of association may be hidden in the data stack, but by raw processing determination: if patterns of association there be, Cloudera will uncover them. It does so for AOL – processing everything that goes through AOL’s online channels everyday looking for those nuggets of association that will motivate and delight the advertisers. A needle in a haystack? Small beer, I am sure, to Cloudera.

And so to Obopay. A simple idea – that financial transactions can be mediated by SMS. Complex in execution to get it absolutely right, so from the proverbial garage in the Valley Obopay has created a fast growing global business whose natural home initially is in India and Africa – where the mobile phone is the tool of choice for the new worlds of e-banking. One has to be impressed.

About the author

Richard Sykes was vice president of IT at ICI in the 1990s and is now a consultant