Leadership in the software industry is a curse

Leadership in the software business is a funny thing. While some, including popular analyst firms, think leadership is a key factor, there is an inconvenient truth: Leadership in software, especially with today’s pace of change, more likely means you’ve grown successful enough to prevent any real innovation from taking place. Put another way, what you’ve become adept at doing…what you reward your people for executing (thereby reinforcing its continuation) is just as likely the next thing to be disrupted.

Looking back at leaders of the past, it is a trail littered with the corpses of companies that dominated the landscape right up until they collapsed like Rome in the 5th Century. Wang, AOL (not dead, but dying), Silicon Graphics, Magnavox, Palm, Sun (yes, alive but nothing like before), and my childhood favorite, Commodore. They were influential companies that brought amazing innovations to the world, only to lose their way.

Given the history of leadership, and with the notable exception of Apple, leading isn’t the same as cornering the market on pork bellies. Companies that grow rich often outgrow their ability to govern themselves. In response they hire bureaucrats and non-risk takers, only to find themselves bloated and slow.

It is an old pattern, but noticeable in a term of years instead of decades in the fast-changing world of software. As BPMRedux puts it, “We need the medium and smaller vendors to continue to push the envelope of innovation because sometimes they take the risks the bigger guys don’t.”

Having been with big and not-so-big, I can speak from experience that the spirit, flexibility and risk tolerance of smaller companies makes them more fun, interesting and rewarding. Ultimately, it makes them less risky than the giants that will never recognize the end coming.

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Categories: Disruption, Innovation

Author:Chris Taylor

Reimagining the way work is done through big data, analytics, and event processing. There's no end to what we can change and improve. I wear myself out...

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4 Comments on “Leadership in the software industry is a curse”

  1. September 18, 2012 at 10:30 pm #

    Amen…disruption always comes from unexpected places. The software industry, especially the enterprise aspect (think ERP), is sliding down yet they and their customers don’t see it. New solutions, such as those offered by BabbleWare (http://babblewareinc.com), are the next step for business and when they move the bottom will drop out. SAP will become Baan and Oracle will withdraw to their infrastructure elements. Long live disruption!

    • September 18, 2012 at 10:32 pm #

      Thanks for your comment, Steve. I would much rather be not-the-leader. But when I get to the be the leader, I’ll probably think differently. 🙂

      • September 19, 2012 at 7:40 am #

        Chris,

        Agreed. However even leaders can disrupt; i.e. Apple. Not staffing your company with risk averse bureaucrats is the first step. A dynamic leader that continues to pushes the envelope is required. That’s how growth companies make their nut, anyway. It isn’t until they change their attitude that they lose their grip.

  2. September 19, 2012 at 7:12 am #

    For those old enough to have been in technology for 10 or so years will have read Geoffry Moore’s book Crossing the Chasm. BTW It is still completely valid. It describes the different types of technology buyers and the maturity of technology markets. To the left of the Chasm are the early stage disrupter products which are bought by evangelists, with a high cost of sale. To the right of the Chasm are the established vendors – the Gorillas – which are bought by IT, and are very profitable for the vendor.

    So here is the challenge. Vendors want to be to the right of the Chasm as it is wildly profitable (SAP, Oracle, Microsoft, Apple), but you need to be the Gorilla that IT are comfortable buying. See the problem yet?

    The perfect answer is to be to the left of the Chasm with a great product just as the market is about to mature/explode so you expand massively as you ride the wave to the right of the Chasm and appear there as the dominant player. Simple really.

    So if you are to the left of the Chasm you need to operate differently to the big players who are to the right. You are more consultative. You are more customer responsive. You are seen as thought leaders.

    To the right of the chasm you just sell, sell,sell.

    If you want to understand how you should behave as a paradigm-shifting, thought-leading, market-disrupting new-tech company read this blog (it is a book summary so longer than most blogs) http://wp.me/pLuvX-AL

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