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Totally agree. If you look at your company, where are your "rockstars"? I don't mean rockstar developers; I mean the most ambitious, most well-connected (and hi

by exelius 12y ago

Totally agree. If you look at your company, where are your "rockstars"? I don't mean rockstar developers; I mean the most ambitious, most well-connected (and highest compensated) people in your company. It's a trick question: they're almost always in sales, marketing or product because these are the parts of the organization that drive profit. This is true of almost every company. It's not a secret why Salesforce was the first real SaaS success story: companies are a lot more inclined to spend money to make money than to spend money to save money. Growth is the name of the game; cost cutting is usually only a focus once growth is no longer an option. That's why I groan whenever I see something like yet another IT operations management platform. Would the company be better off buying a software package to manage their IT, or firing all their IT staff and hiring a managed services provider to fill the gap? Operational cost cutting has a lot of different modalities that are often mutually exclusive, while you can more easily chase down multiple paths for revenue generation.

rubensmead 12y ago
Does ServiceNow count as "yet another IT operations management platform"? Do they make you groan because their IT applications business is doing so well? Or because you think they're overhyped and will crash and sputter?
- exelius 12y ago
  Yes, they do. And I groan because it's an idea I've probably heard a thousand times. Companies will have success, but there will likely be another company in 5 years that overtakes them, and another 5 years after that. It's basically a zero sum market where the entrenched vendor's scale is too big to adapt to the new use cases that pop up every 5 years or so, so a new vendor pops up, becomes the entrenched leader, and the cycle repeats. ServiceNow will likely just get acquired by someone (HP? SAP? Oracle?) and integrated as a module in a massive ERP system. I definitely don't agree with their valuation; they're trading at like a 300 forward PE which is just ridiculous for an enterprise technology vendor in a space as crowded as theirs. They're likely only trading at that level because the analysts are anticipating an acquisition and subsequent bidding war. That doesn't validate the value of their services; just that big enterprise tech vendors are willing to pay a premium to displace their competitors.

by exelius 12y ago

rubensmead 12y ago

Does ServiceNow count as "yet another IT operations management platform"? Do they make you groan because their IT applications business is doing so well? Or because you think they're overhyped and will crash and sputter?

exelius 12y ago
Yes, they do. And I groan because it's an idea I've probably heard a thousand times. Companies will have success, but there will likely be another company in 5 years that overtakes them, and another 5 years after that. It's basically a zero sum market where the entrenched vendor's scale is too big to adapt to the new use cases that pop up every 5 years or so, so a new vendor pops up, becomes the entrenched leader, and the cycle repeats. ServiceNow will likely just get acquired by someone (HP? SAP? Oracle?) and integrated as a module in a massive ERP system. I definitely don't agree with their valuation; they're trading at like a 300 forward PE which is just ridiculous for an enterprise technology vendor in a space as crowded as theirs. They're likely only trading at that level because the analysts are anticipating an acquisition and subsequent bidding war. That doesn't validate the value of their services; just that big enterprise tech vendors are willing to pay a premium to displace their competitors.