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By Date: October 2006

When licensing gets in the way of sales and revenue what will happen?


All public listed companies are infected with a serious virus of the type " You-must-grow-your-revenue-or-die". The stock markets punish "flat earnings" more severely than posting a loss. Well flat earnings could read: we made 10 Billion last year, we make another 10 Billion this year and voila your stock goes south. So every enterprise is looking to grow revenue. While acquisitions are very much in fashion to grow revenue, the core strategy falls into two categories: upsell your existing customer base and acquire new customers. As long as your market is expanding rapidly adding new customers is rather easy. Once markets mature adding new customers means taking them away from your competitors which is costly and tedious (including fending off their retaliation attacks). So "upselling your customer base" is the save bet for most sales organisations.
In software sales revenues are very unpredictable if you just sell licences. So every vendor tries to sell maintenance too. To help customers some offer to spread the up-front payment for licences over the period of a maintenance agreement (typically three years). After that period the licence is paid you only need to continue to pay maintenance and support which would be around half. So once you look at a six year period your cost look like this:

The Revenue GAP

Of course: your cost is the software vendors revenue. Uupps. Didn't we just conclude, that "upselling your customer base" is the easiest way to increase revenue? With that little "spread your payment" option the vendor has build in a gap they need to fill with new products. As long as you create new offerings, that create additional value for the customers, that actually might work. But what do you do if you just want to ship an upgrade to the product the customer has under maintenance? One way is to split your licences into "Standard" and "Enterprise". Then you explain to your customer: "What you have under maintenance is equivalent to the new standard edition, all the new features you cherish are part of the new Enterprise edition". Of course the Enterprise edition requires a new licence -- and hooray your revenue gap is plugged. You even might get away with it. Your customer is used to have paid 100 for the last three years, so they probably have forgotten, that IT cost are supposed to go down and have budgeted 100 for year four to six. With the myopic view on quarterly results and high job rotation that is not difficult to imagine (no Samsung product needed here).
However your customer might start to remember and really starts to run the numbers and ask some questions. My favourite: "Why do I need maintenance on the operating system? We keep desktops for 3 years and don't upgrade them. 100% of our machines use the operating system our hardware vendor had preinstalled."
Then finally your customers might listen to Michael Sampson.

Posted by on 31 October 2006 | Comments (1) | categories: Software

IBM is hiring


Are you interested to work for Lotus in Asia? We have job openings in Singapore, Malaysia, Indonesia, Thailand and the Philippines (there are openings in other parts of the world too, but I don't cover these ). You should have a passion for Notes and Domino and be open for new stuff. We are looking for technical people. Give me a shout!

Posted by on 31 October 2006 | Comments (1) | categories: IBM - Lotus

Looking for an outstanding Intranet?


Since 2001 the Nielsen Norman Group conducts their Intranet Design Annual. They pick the 10 best Intranets of the year and produce a report why they like them and what were the issues in the runner ups. Since I met Jakob Nielsen 2001 in Hong Kong I'm a big fan of his work, so I follow this reports with great interest. Jacob's publications are quite enlightening and sometimes controversial. While I'm a fan that doesn't means that I agree with with all his answers, however I agree with the questions he asks.
If you are in for some amusing reading follow the thread Jakob vs. Web design. (memento: functional doesn't need to be pretty vice versa).
This year's Design Annual found IBM's w3 Intranet among the winners. Nice to know working for a company with an award winning Intranet.... and Jakob and team haven't seen w4 yet. Our Intranet has Websphere, Websphere Portal and Domino all over it, with occasional sprinkles of PHP, CGI and others. RSS, Atom, Webservices, Tags and microformats are the glue keeping it together (SOA anyone <g>:).
The big question now: how long will it take IBM to turn this Intranet into a product?

Posted by on 16 October 2006 | Comments (0) | categories: IBM - Lotus

The last thing you need on a Sunday evening is...


... switching on your Thinkpad, getting a double beep and the message "fan error" and it switches off again. (Which I don't understand, I'm still a fan of Thinkpads, there is no error <g>). No chance to intercept and copy data. Also swapping the harddisk into an external USB case (a standard accessory in the "bastelbox" doesn't help. Our security standards require password protection for the drives, so unless it is another thinkpad and you park it into the Ultrabay (to get the password prompt) there is no way to read that data.
So I will test our repair service 2morrow morning. See how fast the are.

Update: One lesson learned: you hit enter (or F1 or ThinkVantage) on a Fan error: the system shuts down; you hit ESC the system boots without a fan -- substantially slowing down when the heat sensor throttles the CPU. The new fan kit should arrive soon. Until then: slow motion ahead.

Posted by on 14 October 2006 | Comments (3) | categories: IBM - Lotus

What do you think is the most important skill every programmer should posses?


Linus says:
It???s a thing I call ???taste???.
I tend to judge the people I work with not by how proficient they are: some people can churn out a _lot_ of code, but more by how they react to other peoples code, and then obviously by what their own code _looks_ like, and what approaches they chose. That tells me whether they have ???good taste??? or not, and the thing is, a person without ???good taste??? often is not very good at judging other peoples code, but his own code often ends up not being wonderfully good.

There are other great questions and answers from the Olymp of our developers in Stiff's blog

Posted by on 10 October 2006 | Comments (0) | categories: Software

Closing down fromDomino


It has been around for a while but other than the initial stir not much activity happened. Also the team is quite busy with other stuff, so we decided to pull the plug and decommission the Blog fromDomino.com. With my team's permission I will republish the more interesting bits as SnTT articles here on this blog.

Posted by on 01 October 2006 | Comments (0) | categories: IBM Notes Lotus Notes