James McQuarrie is a UK based Product Leader who helps teams discover, design, build and deliver digital products and services that delight their users.
In the World of corporate or enterprise computing there have traditionally been two options for a software company to deliver its wares to its customers; either on a CD (or several) in a box with a load of instructions on how to install and configure it, or on CDs accompanied by an IT consultant who will bring his or her own instructions and run the installation for the customer. Either way as a customer of these companies you needed to have your own infrastructure, back up processes, maintenance processes and enough staff and training to keep the system running once it was up.
In the past few years the options have changed slightly. More and more software companies and their customers are adopting the cloud computing model in which software providers license their applications to customers for use as an on demand service over the Internet. This can either be through a time limited subscription or as a pay-as-you-go model. Either way, the application is made available online, with no need for installation, set up or maintenance on the customer side.
The advantages to the customer are obvious when you understand the significant effort and money required to keep enterprise servers and networks up and running. Customers no longer need to have their own complex hardware, just an Internet connection. They no longer need to worry about back up routines and hard drives; everything is backed up online. They no longer need to deal with complex configurations if their version of the server isn’t the same as the one the software requires. They have no more patches and updates to test or install. They no longer need to worry about scalability if they gain more business or staff. Simply sign up, log on and use the software.
The advantages to the software company are huge too. No more shipping a product in boxes cuts down the cost of production and distribution. No more having to support thousands of different implementations of their products; they control how it’s been installed. No more supporting different versions of their product as they can work purely with the one, live, fully up to date version that is currently being offered to customers. No more years of investing in a new version of the product only to find that no one wants to buy the new version and it’s a flop; add or change a feature and test it live with real customers. No more contacting each and every customer individually when a patch is released and no more finger crossing that they’ve each installed it.
There is, however, a potentially massive disadvantage to the software company too. In the days of old, when your product was supplied on a physical disk for your customers to install and maintain themselves, once you were in a customers set up you were likely to stay there. The effort, pain and money required to remove one product and set up and run another was so huge for most organisations that something drastic would have to happen for them to even consider it. In those days once you’d sold your product it was in, running and would stay there. Even if the user experience was not that great, and lets be honest; how many enterprise applications are there with a great user experience? It didn’t matter too much, organisations would buy the product based on it’s feature list and whether they thought it could be installed and run on their infrastructure. If the people who had to use the product complained that it wasn’t nice to use, it was tough. No IT department was going to rip it out because some users didn’t like it.
Now though by the very nature of your cloud based software, it is relatively painless for a customer to run a trail with a competitor’s product and switch over to it if they deem them to be more suitable than your own. Apart from some possible (and admittedly, often not insignificant) data migration issues that they may have, they no longer need to worry about the whole infrastructure, setup, installation and maintenance costs.
Now, if enough users aren’t too happy with your product the barrier to change it is very low. Now you need to please the end users. Now you do need to offer a great User Experience. If you can offer a product that is a joy to use, that people actually like, then you encourage brand loyalty and discourage shopping around for other options. For software companies that understand this and do something about it, the future is bright. For those that don’t your customers will soon realise that they can achieve the same things they do with your software, but using someone else’s that is easier to use and makes them more productive.
No longer should you be competing on feature lists; “install my software as it does 100 things more than the next competitors”, you are now competing on how easy to use and cost effective your software is; “sign up now in less than a minute to be 5 times more productive”.