Software CEO Double-Speak Says Nothing About the Economy

The terrible economy and recession-that-won’t-go-away has gotten so bad that many people now look for any sign of recovery—in job claims data, in a few retailers’ positive results, and even in a forward-looking report from the Bank of Japan on Japan’s GDP.

The stench of desperation for positive news is everywhere.

In the high-tech arena, media types, industry analysts and inventive bloggers are now pouring over statements made by CEOs of enterprise software and hardware vendors as they report quarterly earnings.

“Oh, please, software CEO…please tell us everything’s getting better?!”

The latest aggregation of “Software CEOs’ Take on the Economy” comes from the WSJ’s Digits blog: a tidy summary of economic recovery comments from the leaders of Salesforce.com, Autodesk and Intuit.

This group of CEOs say that we have not hit the bottom, which, of course, contradicts what some bigger-name tech titans have recently said about the figurative bottom being hit, notes the Digits blog.

Perhaps the best example of the “two-faced” CEO is HP’s Mark Hurd, in a CNBC article on CEO economic prognostications: “HP gave a disappointing full-year revenue outlook this week, and although CEO Mark Hurd said the company had seen pockets of improvement, he told Reuters: ‘We’re expecting roughly more of the same.'”

That clears it up.

For me, using the tech industry as a barometer on the overall economy just doesn’t work, chiefly because tech spending (one way or the other) usually lags the overall global economy—sometimes by very long stretches. Enterprise software purchases don’t resemble going to the mall to buy some new jeans.

And second, tech CEOs aren’t the most objective “economists” in the world—what with the complex amalgamation of shareholders, partners, customers, employees and financial analysts that they have to contend with and satisfy.

As I pointed out last fall, right after SAP told its own employees to “not order any new IT equipment at this time,” it launched a marketing offensive, reminding its current and would-be customers that a recessionary environment is when “great companies invest in SAP software to beat the competition!”—just as I snarkily predicted would happen.

I think I’ll stick to the views of those economists who aren’t running billion-dollar software companies.

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