Ninety-nine percent of advertising doesn’t sell much of anything.
~ David Ogilvy
Over at ReadWriteWeb Enterprise, there’s a very good article interviewing longtime Silicon Valley investment banker Sanu Desai where he makes a strong case that massive disruption is coming to the enterprise software space.
“…if you add up the market valuation of the old-guard companies selling to the enterprise — Oracle, SAP, Microsoft, Cisco and so on — you’re looking at about $1 trillion in total. And those companies are about to get hit with a tsunami of competition as smaller, more nimble rivals rush into the market offering solutions that outperform the old guys at a fraction of the price…Little by little, those upstarts will tear away market share held by the old guard and rob them of their market value.”
Common sense? Maybe. This is the same disruption that’s been happening in the IT hardware space (the consumerization of IT) for years. People, whether in an SMB or an enterprise setting are going to going to gravitate to using available tools to get their work done in the easiest, most efficient way possible. That’s human nature.
If an enterprise only offers antiquated, un-flexible and inefficient tools, these days motivated individual and department level decision makers can easily circumvent enterprise IT and implement open market SAAS tools that are easier to use and faster at getting the job done. Enterprise software companies need to provide software that gets the job done better than apps and freemium or low cost SAAS.
The article is wrong about one thing…it says that enterprise software is about to be hit with a tsunami of competition. But the reality is that the tsunami has already happened. The water is in the basement and the sand bags that enterprise IT departments have put up can only hold out for so long…
One of the most fun and rewarding things that I was able to do on the Board of the WOU Foundation was putting together ‘Climb for College’. Here I am with fellow board member Erik Stromquist and co-worker Friedrich Gloekler climbing Oregon’s Mt. Hood to raise money for the WOU Foundation.
An economist is an expert who will know tomorrow why the things he predicted yesterday didn’t happen today.
What’s Wilderness Really Worth? Wilderness Economics May Provide The Answer
I came across an excellent article in Outside Magazine written by Bruce Barcott discussing the emergence of ‘Wilderness Economics’, which he says is “a dollars-and-cents way to attach a fair and reliable estimate to the seemingly uncountable value of preserving wild spaces and pristine natural resources”. The article titled ‘As a Matter of Fact, Money Does Grow on Trees’ makes a compelling case for conservationists to re-frame their messaging from ecological science and souls to discussing the actual monetary value of environmental resources. As an illustration of the power of the environmental economics, consider the following excerpt:
“In 1989, for instance, EPA officials ordered the City of New York to build a water-filtration plant that would cost $8 billion to construct and $300 million a year to operate. Instead, the city spent $2 billion to restore and protect its Catskill Mountains watershed, letting a healthy 2,000-square-mile forest do the work of an $8 billion industrial plant. Estimated value of water filtration provided by the watershed: $6 billion and counting.”
But environmental economics is about more than watersheds. My favorite economics professor from college, Ed Whitelaw, is quoted in the article discussing the “lifestyle dividend” that my fellow Oregonians receive from living in places like the Pacific Northwest “Firms that compete nationally for highly skilled, highly educated employees can pay a little bit less than the national rate, because people are willing to trade off a little of their dollar wage for the nature wage.”
Additionally, Barcott drives home the point that Wilderness Economics seeks to quantify the economic impact of recreation. “In 1995, U.S. Forest Service economists took stock of the agency’s land and found that national forests generated $125 billion a year in economic activity. Recreation accounted for 75 percent of that figure. Timber and mining made up 15 percent. ”
New media such as blogs and social networking represents an enormous opportunity for conservationists to educate the public about the value of environmental ecosystems. We all need to keep in mind that this opportunity can be leveraged by framing the conservation message in terms of dollars and cents economics.