Prediction: Enterprise software, as we know it today, will be largely dead in five years.
Specifically doomed is the model at companies like Oracle, where hitting revenue targets has become significantly dependent on the persuasiveness and drive of a sales force that is more than 50% of its total employee count (As of December 2012, Oracle's sales force was around 63,000 strong, compared to a total employee count of ~118,000). More on the larger trend in a later blog post.
Earlier this year, Oracle announced that it had missed Q3 revenue, and blamed that miss on its sales force and a lack of urgency. As a product-focused guy, it feels weird and a little scary to pin my success on my sales force's sense of urgency?
John Burke, Oracle's group vice president for global sales support and new product introductions, attributed this to his observation that "salespeople don't often know the real stories behind why their customers bought and how their customers actually use their products." They are too far removed from the software to actually know its value to users and customers. Their goals have been reduced to hitting a number, rather than delivering value to customers.
This is not a unique perspective. Former employees have echoed the same sentiment on public forums for years. Even the employees that seem to like working at Oracle betray its lack of customer-focus.
The writing is on the wall, and has been for some time. Success in enterprise software will be led by a shift in focus back to the customer and the user. Back to people wanting to use your software, rather than being convinced to. Back to driving value for customers.
If Oracle and other legacy enterprise software companies don't change their focus, there are plenty of customer-centric companies that will happily displace them in enterprise IT stacks.
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