My inspiration for this post was from a comment made by Jeff Bezos, founder and CEO of Amazon.com, Inc., at the recent re:Invent Amazon conference in Las Vegas:
I organized the topics in this post by quotations from Jeff in the video above.
I very frequently get the question, “what’s going to change in the next 10 years?” And, that is an interesting question; it’s a very common one. I almost never get the question, “what’s not going to change in the next 10 years?” And, I submit to you that that second question is actually the more important of the two – because you can build a business strategy around the things that are stable in time (Bezos, 04:31).
This is an interesting concept and a question that developers should be asking their clients (and by “clients” I mean business users) on a daily basis. What’s not going to change in the next 10 years? As developers we spend a majority of our time addressing business “needs” – only, these are not the real business needs. We keep busy responding to support tickets, maintenance requests, and seemingly random feature requests. But who is defining the underlying business goals? These requests might allow a business user to accomplish a single short-term sales goal but how are they benefiting the company long term? Requests such as these add up over time and lend themselves to convoluted development organizations that rarely make forward progress, yield new innovation, or produce any real results or revenue growth.
In truth these are the sort of requests which should be outsourced. They are supplemental expenditures that are unlikely to ever yield a major benefit for the company and thus do not require the same focus and attention to detail of requests which contribute to the real bottom line. How they are completed is not as important as how quickly they are completed in order to fulfill that isolated sales goal.
For the past five years I have worked in the media industry. Here are a few examples of some key principles of my business that will not change in the next 10 years:
- Advertising is a primary revenue stream.
- Email newsletters: are a key source of traffic, act as an additional advertising medium, and keep customers engaged.
- Fresh content attracts new customers and keeps existing customers interested.
As such I can define a specific and narrow focus for our internal development team to contribute to my company’s bottom-line:
- Ad management – tools that we will continue to use across every publication and business vertical and for the eternity of our business.
- Email newsletters – creation, management, and dissemination.
- Content management – automatically promote top-visited and highest-rated content (in a way that facilitates conversions or promotes a call to action), organize, promote, and digest new content often.
By focusing on these consistent and relevant areas of interest, development can concentrate on creating and enhancing tools that my company will continue to rely on and will provide a significant bottom-line benefit. Emphasis on increasing efficiency and decreasing production time through simplification of these systems will result in direct revenue growth:
- Content Management Systems (CMS)
- Digital Asset Management (DAM)
- Videos – DAM integration, tagging and categorization, channel association, trans-coding, streaming, and advertising (pre, post, and mid roll)
- Ad Management – Inventory, Targeting, Delivery, and Reporting
By simplifying the business and understanding the objective we can prioritize development in such a way that it maximizes its potential to positively affect revenue growth. So we know what we need to build but how do we ensure that our development team will create new innovative solutions?
First of all, i think innovation is a point of view. You have to actually select people that are part of the company who want to innovate and explore (Bezos, 07:05).
I have designed and developed more than 20 Content Management Systems for companies of all sizes – mostly media but not all. There are a number of common components but every industry and even every company has unique needs and therefore requires customization (development) if you want to maximize the organization’s potential.
Bottom line, innovation requires innovators and in my line of work that translates to developers, architects, and engineers with an aptitude for creativity, a stated vision, and a clear business direction. I read a few articles recently that discuss facilitating innovation by hiring and encouraging the right people – perhaps not in those same words but the thought is certainly along the same lines. Interestingly enough they were both derived from Apple – arguably the greatest innovator in the tech industry at the present time when it comes to marketing and gadgets. They have literally created the need for products that did not previously exist and they do it repetitively:
- Steve Jobs’s Tips for Hiring Your A-Team
- Apple Blue Sky Program Gives Employees Time to Work on Passion Projects
Most companies undervalue their IT organization because non-technical executives and board members view them only as an “operational expense” rather than as innovators. Invest in your IT organization. Challenge it to generate its own revenue by building tools that you can resell as services. Most importantly, give them the freedom to explore new options, research, create, and stay current. Hire the right talent, buy them a race horse, and allow them to help you succeed.
One of the biggest, still unappreciated benefits of AWS is that application developers get a real sense of which inner loop is driving all the cost (Bezos, 16:06).
I chose to end this post with this quote because I think it offers a perspective which is too often overlooked and should be left for further consideration. While Amazon Web Services (AWS) certainly helps identify costly processes within your IT applications and workflow – developers, systems administrators, and architects observe these inefficiencies in your overall business workflow on a daily basis. Few companies (none that I have worked for) actually ask the IT organization to assist in identifying business inefficiencies. I am not talking about IT inefficiencies; we are always asked, “how can [we] further reduce IT costs?” I’m referring to actual business inefficiencies – poor communication, lack of an organizational hierarchy, lack of integration between essential business tools (CRM, accounting, inventory, traffic analytics, etc.).
The IT organization directly interacts with each and every member of the company daily – service delivery, project management, client management, communication, etc. and they have as a result a unique perspective of the organization as a whole. It is not top-down, bottom-up, or outside-in. It is not biased toward a specific business vertical. It is not limited in scope. It is an inside-out perspective of the whole organization in its entirety – they facilitate publication of any outgoing media and they receive every contact form notification (from website visitors), feature request (from customers and sales representatives), defect and bug report (from internal business users), report request (from executives and managers), even the traffic analytics and conversion statistics.
The company executives however tend to hire third-party consultants, auditors, and outside organizations hoping to gain new perspective (yet always from the same position – outside). It is almost amusing to observe this from within an IT organization because you really do in many ways feel isolated from the rest of the business. But, while the various business verticals within your organization are intrinsically focused only on themselves, the IT organization is generally busy fulfilling the business users’ requests – all the while observing the business from the inside out.
So go into work tomorrow and ask your senior developer or architect, “what are the 3 greatest inefficiencies of our organization?” I am certain you will initially receive a list of names (let’s face it, developers aren’t known for their social or political skills) but if you explain the context of your question I think you will be surprised by the answers you receive – the depth of thought, and the unique perspective perhaps not previously considered.
Developers will spend months working on a project while participating in daily conversations in jest about the lack of traffic to a particular feature, the abandonment of a new “necessary” feature, and cost of the resources wasted on implementation – all the result of a single business user (who undoubtedly views IT as no more than a paid service tasked with executing visions concocted by creative sales representatives) touting “revenue, revenue, revenue”.
Sales representatives are always eager to meet the “immediate need” of an individual customer but rather than burdening development with the task because you’ve “already promised the customer”, try instead to curb their request toward an existing product: “I will submit that request to our customer solutions team and see if we can incorporate it in the next release. Meanwhile, we can offer these similar services … Let’s discuss how we can leverage this product in a way to still meet your primary objective.”
I drafted a post the other day titled “If I were Facebook’s CEO …” which referenced an article, “Turning Data into Dollars” noting a statement by Josh James that there isn’t a single CEO who isn’t thinking about data. Well I would further contend that, if you are a CEO who is not investing in your own IT organization and entrusting them to add value to your bottom line, then you are missing out on significant revenue potential. Amazon Web Services exists today as a side-effect of an innovative company that overcame the challenge of building the world’s largest online retail organization – and they saw the value in that and spawned a new business vertical – one that generated more than $1 billion revenue in 2011. Consider this the next time you’re CIO is presenting his annual executive summary in a board meeting and ask yourself this question:
Is my organization maximizing its IT potential?
If the answer is “no” then ask yourself, “What am I doing to facilitate and encourage it?” Are you attracting quality talent? Are you encouraging innovation? Are you investing in research and training? Are you involving them in the actual business? Have you stated a clear and simple business objective? If you answer “no” to any of these questions then I can tell you, no – indeed you are not maximizing your IT potential and you are missing out on significant revenue as a result.
- Risk Management Can Stimulate, Rather than Deter, Innovation (forbes.com)
- Who Will Be The Next Iron Chef Of Innovation? (forbes.com)
- How to Innovate with an Executive Sponsor (centralisious.com)