Andy Hayler, a software entrepreneur and generally thoughtful guy, reminds us of one of life's Ironic truisms, 20% means more than 80%.
Andy points out that Microsoft is methodically making inroad into the business intelligence application category. Andy's core thesis is as follows: Microsoft may never field a product offering that offers the depth of features and functionality as do Cognos and Business Objects, but it really doesn't matter as "most users only take advantage of a fraction of the features of a BI tool anyway."
This is the exact same dynamic that is occurring all over the software sector. Think Salesforce.com vs. Seibel (Oracle), Google spreadsheets vs. Excel, MySQL vs. Oracle, Linux vs. Unix, Writely vs. Word, ... The fact is that 20% of the functionality provides 80% of the value. Put another way, 80% of the market only needs/wants 20% of the functionality. The irony is that software vendors are notorious for adding features over time. As a rule, it's function that most users don't want, need or care about. Further, the additional features are not typically monetizable! If anything, its a strategy to keep pricing from eroding, not pull more $ from the client.
Perhaps all software entrepreneurs, VCs and big company corporate executives should consider their strategy within the 80/20 rule. Is the software industry product/business model all wrong?
Your first step in your automobile purchase should be the price.
Posted by: cash advance | July 15, 2011 at 06:49 AM