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Will the enterprise market spend significant IT budget on Windows Vista in 2007?



Invigorate Your Company in 2005
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Challenges Remain
But CEOs appear to be straddling two worlds: one in which they can watch the success of their own company, and another in which they are constrained by the realities of the overall software industry and today’s economic realities. They are optimistic, but realistic.

Many company leaders report their customers are very satisfied – yet fewer than half actually have a process for formally evaluating customer service. This is astonishing in a maturing industry dominated by a handful of large players.

The customer satisfaction finding is indicative of a larger problem: Lack of performance benchmarks. Software vendors need to operate like other value industries with close management of financial, customer service, product development and marketing metrics. In today’s highly competitive industry, anything less than constant attention to customer care is suicide.

Path to Change
In my experience, it seems every software company leader feels he or she is doing everything possible to engineer transition and to manage for the future. Review this checklist to see how your company stacks up.

1) Business model changes: How has your business model changed in the past year? Two years? If there are no changes going on, your company is not reacting to new market realities.

2) Customer monitoring: How does your company evaluate customer satisfaction? If informally, institute a customer satisfaction monitoring process which will monitor progress over time.

3) New technologies: What plans does your firm have for open source? Web services? Mobile technology? Enterprise customers are rapidly integrating these emerging technologies into their strategies and vendors need to incorporate them too.

4) New processes: What portion of your operations is outsourced? Offshored? How are you dealing with the predicted year of growth ahead? Re-energize your business model with new thinking and strategies by working with outside vendors.

5) Performance benchmarks: How does your company compare itself to the industry or to past performance? Every company must have a set of metrics to manage it which are watched over time and acted upon in case of diversion.

Clearly, the industry is in a period of transition. There will be many more experiments before it settles on a course. And there will certainly be new variables on the horizon which will shake things up yet again. It will take some time to reach the right model – much longer than anticipated. But many longtime software industry followers will applaud today’s CEOs for taking steps in the right direction.

M.R. Rangaswami is co-founder of Sand Hill Group and publisher of SandHill.com. Send your ideas about how the industry is evolving and suggestions for performance benchmarks and change management to editor@sandhill.com and newsletter@sterlinghoffman.net


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