What if... we started spending again on IT?

There was a time when users couldn't get enough IT. Selling it was easy. Dale Vile isn't sure the good times will ever roll again. Now meet 'Nick'...

Nick was a really successful software sales person. Between 1995 and 2000 he made a killing on commission and stock options working for trendy leading edge vendors.

Times were great back then. All you had to do was adopt a concerned look when the customer admitted they didn't have an enterprise portal strategy or an e-procurement project and say: "Don't worry, we can help. We'll make sure you don't get left behind and fade away into oblivion because you don't have the latest technology to compete effectively in the marketplace."

"Thank you for saving me," the customers would say. "We were getting really worried as it seemed like we were only ones not doing it. Where do we sign?"

Every now and again, a customer would ask: "But just how much more competitive is this software going to make me?"

Again, the concerned look would appear and Nick would say: "You really have to shake that old economy mindset. All the time you are thinking and analysing your competitors are using superior technology to launch new products in the blink of an eye and steal your customers away from you." Most of the time, this seemed to do the trick.

Then came crash and, suddenly, everything changed. By then, however, Nick had paid off his mortgage and bought a nice holiday home in the sun. So, after comparing notes with a friend on how difficult life had become over a beer one evening, he decided to drop out for a while and take it easy at the beach until the market bounced back. He would then pick up where he left off.

Time flew and it was soon mid-2004. Nick had had a good long rest but the funds were starting to run a little low, so he decided it was time to make a comeback. Luckily, the market had picked up considerably. The terrorist problem was under control, the money markets had recovered and companies were spending again on IT. Just a matter of finding one of those good old-fashioned high-tech start-ups, grabbing the stock options and getting stuck in again.

Nick found a great company which specialised in delivering 3G wireless applications. "Great," he thought, "leading edge technology, sexy devices and lots of acronyms to make it sound really sophisticated."

He got a little suspicious during the interview when his boss to be kept talking about "solution selling" and "business benefit". All the time Nick was thinking: "But this stuff is sex on a stick. Everyone will want technology this cool. These guys are making it all too complicated." Nevertheless, he went through the motions, put up a good show and was duly offered the job.

First sales call. Nick finished his pitch with "...and we can set up a pilot project for you at a cost of less than £20K. Within a month, we can put this stuff in the hands of your key people in the field so they can start kicking the competition where it hurts".

"Thanks for the offer, Nick," said the customer. "It does sound interesting but we need to work through how it will fit in with our web services architecture and integrate with our ERP and CRM systems. Also, of course, we have to work with the business units to put together a business case for the eventual rollout if the pilot is successful. This will take some time."

"Sorry man, the reality is 'you snooze, you lose'," replied Nick. "While you take time out to think, the competition..."

"Please let me stop you there, Nick," interrupted the potential customer. "We have been through this loop before back in the late 90s and early 00s. What we ended up with was a collection of immature technology products that didn't scale and were impossible to integrate and maintain without spending a fortune. When we requested more money to make it all work, the business asked what they would get in return and, quite frankly, we couldn't come up with answers."

"But you told me earlier that you now have lots of money in your IT budget," reasoned Nick, "and this is only £20K after all. Why don't you just fund this one under the radar? Look how sexy this stuff is..."

"You are right when you point out that we now have a substantial IT budget," replied the customer. "But if we spend any of it without having a good business reason or without thinking through how it fits into the bigger picture of the business and IT strategy, we'll just end up back where we were a three years ago. And I'll probably also find myself out of a job".

So Nick left a proposal on the customer's desk and met up with an old mate for a drink.

"It's all changed, Nick," explained his friend after hearing about the frustrating first day back. "While you were away, the rest of us have had to make some adjustments. You see, businesses no longer buy software just because it's the latest technology or the current fashion. IT departments are now answerable to the business.

"They are also wary about buying best of breed products from specialist vendors without a lot of due diligence as this seemed to cause more problems than it solved in the past. That's why so many of the little guys have either been bought up or gone out of business."

"So how do you sell software nowadays?" asked Nick.

"Get to know the customer, their existing investments and their current business issues. Then offer them a 'business solution'," replied the friend.

"Mmm, that sounds like an awful lot of work to sell a piece of software," said Nick thoughtfully. "When do you think it will get back to being like the old days again?"

"Never," said the friend.

Agree? Post a Reader Comment below or email editorial@silicon.com to let us know - or say what you'd like Dale to cover in future 'What if...' columns.

**Dale Vile is service director at analyst house Quocirca. His C.V. boasts years at Nortel Networks, Bloor Research, SAP and Sybase and his job now involves working with vendors and users wanting to tap the business benefits of technology. For more information see: http://www.quocirca.com

Past columns:
What if... companies ditched customer care altogether?
http://www.silicon.com/a54993
What if... we didn't have modern communications and IT?
http://www.silicon.com/a53871
What if... everyone always knew where you are?
http://www.silicon.com/a52368
What if... the sales and marketing director was put in charge of IT?
http://www.silicon.com/a51814
What if... 3G was available right now?
http://www.silicon.com/a51156