Tuesday, July 21, 2009

Software -- A Product or Enabler?

Good software design and sales begin with a thorough understanding of the underlying business process the software is to enable. Layering software on a misunderstood and broken business process only exasperates operational issues and masks root causes.. Software should GREATLY impact the overall performance of any process, not hinder.

I have spent some time in the software business as a product manager, several years running a tech investment firm and now run a health care services company. My first love has always been solving problems using process engineering, cost accounting and total quality initiatives as they relate to business operations. Most recently, I have jumped into a health care practice with the eye of improving the operations. The first thing I noticed was how broken the process was and how poorly designed and implemented technology (software) simply confused and compounded the issues and almost never met the stated goals and expectations. Some of this failure fell squarely on our shoulders – we simply did not have a good grasp on the process. But, the companies selling into this space NEVER ask any process questions and in fact the notion of “work flow” is completely foreign to them. They did what most software comes do, sell features and functionality and promised new and exciting technologies to come.

The first thing we did was go BACK to paper and document the process. But first, we sat and watched the people work and kept our mouths closed. Spend a week just sitting and watching — hard to do, but you will learn much more. Interestingly enough, if you ask someone how they do something, they will give you a detailed set of steps, but if you sit and watch you will see things they missed or little go-arounds they failed to mention.

So, this brings me to the notion that software is a product, or more accurately, my thought that it is NOT a product, but merely an enabling technological component of the process. What we need is a software sales person that is a process/workflow consultant that can fix our process and then apply their technology; I guarantee that any sales person who uses this skill will KILL their quota. The opposite is usually true — sales guy promises nirvana, operator is desperate and buys the hype, software is installed, process is worse, more complicated and takes a PhD to fix. That sucks, pure and simple.

My advice to early stage software companies is to invest in process (lean) expertise and go WATCH how your customers MAKE MONEY. Then document how your enabling technology will make them MORE MONEY. Stop with quotas, calls, etc. Put the customer’s process first and the rest will follow.