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You know, I always used to think that e.g. Amazon talking about “customer obsession” was stupid. Of course a business is focused on its customers? That’s where

You know, I always used to think that e.g. Amazon talking about “customer obsession” was stupid. Of course a business is focused on its customers? That’s where the money comes from? Then I got to see the conversation about subscriptions at VMware. The storyline was always “wouldn’t it be great for us if we switched to subscriptions? Look how good all the math gets!” The customer barely appeared as a background character. Especially entertaining when it came to things like PWS. After the acquisition VMware shut it down — because it didn’t have any real customers — and then in the push to subscriptions the new folks in charge of TAS were like “Great idea everyone! What if we provided Cloud Foundry… as a Service!” The engineers who had been around long enough to see the whole cycle tried to explain but I don’t think it got through.

ljm 3y ago
I read The Messy Middle some time ago, which mostly documents the process of Behance's CEO joining Adobe post-acquisition and then switching their entire suite of products over to their new subscription-based model, Creative Cloud, and sunsetting their perpetual license model. This is described in the book as a fantastic achievement for Adobe but one that was quite difficult to get off the ground. On reflection I do not share that assessment and while it may have been personally successful for the CEO/author of the book, it was done entirely at the expense of the customer and their experience. I would in fact consider renting software that takes up storage on your own hardware to be anti-consumer.
- chii 3y ago
  > it was done entirely at the expense of the customer and their experience. this is what it means to be a monopoly. Adobe may not be one by the legal definition, but it certainly is a monopolistic suit of products, as their "customer" does not have a way to switch, regardless of other competing software. I personally think that the current legal idea of a monopoly is too narrow. I say the definition should be focused on the customer's cost of switching - and if it's higher than some reasonable threshold, the provider of said service/product must be considered a monopoly.
al_borland 3y ago
At most companies it is an uphill battle to advocate on behalf of the customer. It's really important that those values start at the top, and get support at all levels of management. The best story I heard on this was from Zappos and Tony Hsieh. Zappos was famously customer focused (which probably played a big roll in Amazon acquiring them). The story goes that after a night of drinking they had someone call Zappos to find pizza for them, and Zappos customers services helped them out (not knowing the CEO was there listening). https://www.youtube.com/watch?v=jJ5k_Byd9Fs&t=2296 https://www.youtube.com/watch?v=jJ5k_Byd9Fs&t=2296
- avar 3y ago
  If they were customer focused they'd focus on cutting their profits to give lower prices to consumers. Did you hear about the CEO that told institutional investors that the company missed projections, but that they shouldn't worry about it because he'd help them order a pizza? Me neither, but it shows how absurd this sort of story is if the shoe were on the other foot.
  - mynameisvlad 3y ago
    Disagree. Customer support is not free. Good customer support is not cheap. Whether you agree or not, good CS is one of the Zappos differentiators. There are outlets for cheap shoes (in this case) without overhead from support and other sources.
    - blagie 3y ago
      Quite often, higher-profit higher-margin businesses are more robust. If you have a 1% margin, and costs increase by 2%, you're bleeding money. If you have a 50% profit margin, you're not sensitive to small (or even medium) fluctuations. That's not a universal. I can give a half-dozen counterexamples (including Walmart) which, for example, operate with extreme efficiency, or achieve massive scale. But it's a good rule-of-thumb. Running a business, there are sometimes more important things than profit. Robust businesses are more pleasant to run and to work in than ones with razer-thin margins (even if bigger and more profitable). As an entrepreneur, if I were to pick: 1) Guaranteed income of $200k for the rest of my life (inflation-adjusted) with fun work and reasonable work-life balance 2) A $20M payout with 50% odds I think I'd pick #1. Ergo, we see a lot of lifestyle businesses, businesses which don't try to grow, or otherwise. Yes, one can make a lot of arguments about fiduciary duty, shareholders, etc. Some of those are even correct for a large, public corporation. But most don't apply to a founder-owned founder-run business.
ARandomerDude 3y ago
Amazon Prime is a subscription though. It seems Amazon and VMware are in many ways similar in that regard.
- mynameisvlad 3y ago
  Just because the two both use subscriptions doesn’t mean their business models are in any way similar. JetBrains, for instance, also does subscriptions. They are generally lauded as doing them right. I would never compare JB to Amazon or VMWare just because they both do subscriptions.
  - sangnoir 3y ago
    To be fair, JetBrains did attempt to get rid of perpetual licenses too at one point, the plan they backed away from - after massive blowback - was to brick customers' IDEs as soon subscriptions lapsed.
    - chii 3y ago
      And the reason the backlash worked is because there are at least viable alternatives to intellij (at worst you go back to eclipse, or switch to vscode or any number of other lesser known IDEs). Therefore jetbrain cannot afford to alienate their customer base. Unlike vmware or adobe.
jimt1234 3y ago
I used to work at a company that talked a lot about "customer obsession", too. However, in reality, the way the company operated reminded me of that scene from The Wolf Of Wall Street: "Fuck the clients. ... Move the money from the client's pocket into your pocket." And it all started at the top.

ljm 3y ago

I read The Messy Middle some time ago, which mostly documents the process of Behance's CEO joining Adobe post-acquisition and then switching their entire suite of products over to their new subscription-based model, Creative Cloud, and sunsetting their perpetual license model. This is described in the book as a fantastic achievement for Adobe but one that was quite difficult to get off the ground. On reflection I do not share that assessment and while it may have been personally successful for the CEO/author of the book, it was done entirely at the expense of the customer and their experience. I would in fact consider renting software that takes up storage on your own hardware to be anti-consumer.

chii 3y ago
> it was done entirely at the expense of the customer and their experience. this is what it means to be a monopoly. Adobe may not be one by the legal definition, but it certainly is a monopolistic suit of products, as their "customer" does not have a way to switch, regardless of other competing software. I personally think that the current legal idea of a monopoly is too narrow. I say the definition should be focused on the customer's cost of switching - and if it's higher than some reasonable threshold, the provider of said service/product must be considered a monopoly.

al_borland 3y ago

At most companies it is an uphill battle to advocate on behalf of the customer. It's really important that those values start at the top, and get support at all levels of management. The best story I heard on this was from Zappos and Tony Hsieh. Zappos was famously customer focused (which probably played a big roll in Amazon acquiring them). The story goes that after a night of drinking they had someone call Zappos to find pizza for them, and Zappos customers services helped them out (not knowing the CEO was there listening). https://www.youtube.com/watch?v=jJ5k_Byd9Fs&t=2296 https://www.youtube.com/watch?v=jJ5k_Byd9Fs&t=2296

avar 3y ago
If they were customer focused they'd focus on cutting their profits to give lower prices to consumers. Did you hear about the CEO that told institutional investors that the company missed projections, but that they shouldn't worry about it because he'd help them order a pizza? Me neither, but it shows how absurd this sort of story is if the shoe were on the other foot.
- mynameisvlad 3y ago
  Disagree. Customer support is not free. Good customer support is not cheap. Whether you agree or not, good CS is one of the Zappos differentiators. There are outlets for cheap shoes (in this case) without overhead from support and other sources.
  - blagie 3y ago
    Quite often, higher-profit higher-margin businesses are more robust. If you have a 1% margin, and costs increase by 2%, you're bleeding money. If you have a 50% profit margin, you're not sensitive to small (or even medium) fluctuations. That's not a universal. I can give a half-dozen counterexamples (including Walmart) which, for example, operate with extreme efficiency, or achieve massive scale. But it's a good rule-of-thumb. Running a business, there are sometimes more important things than profit. Robust businesses are more pleasant to run and to work in than ones with razer-thin margins (even if bigger and more profitable). As an entrepreneur, if I were to pick: 1) Guaranteed income of $200k for the rest of my life (inflation-adjusted) with fun work and reasonable work-life balance 2) A $20M payout with 50% odds I think I'd pick #1. Ergo, we see a lot of lifestyle businesses, businesses which don't try to grow, or otherwise. Yes, one can make a lot of arguments about fiduciary duty, shareholders, etc. Some of those are even correct for a large, public corporation. But most don't apply to a founder-owned founder-run business.

ARandomerDude 3y ago

Amazon Prime is a subscription though. It seems Amazon and VMware are in many ways similar in that regard.

mynameisvlad 3y ago
Just because the two both use subscriptions doesn’t mean their business models are in any way similar. JetBrains, for instance, also does subscriptions. They are generally lauded as doing them right. I would never compare JB to Amazon or VMWare just because they both do subscriptions.
- sangnoir 3y ago
  To be fair, JetBrains did attempt to get rid of perpetual licenses too at one point, the plan they backed away from - after massive blowback - was to brick customers' IDEs as soon subscriptions lapsed.
  - chii 3y ago
    And the reason the backlash worked is because there are at least viable alternatives to intellij (at worst you go back to eclipse, or switch to vscode or any number of other lesser known IDEs). Therefore jetbrain cannot afford to alienate their customer base. Unlike vmware or adobe.

jimt1234 3y ago

I used to work at a company that talked a lot about "customer obsession", too. However, in reality, the way the company operated reminded me of that scene from The Wolf Of Wall Street: "Fuck the clients. ... Move the money from the client's pocket into your pocket." And it all started at the top.