The Powerful Force Shaping the Modern Enterprise
Raygun sponsored this post.
No category in tech is more ferociously competitive than enterprise software. As the race to deliver a steady stream of productivity tools to businesses produces thousands of startups every year, the gap is widening between the darlings of Silicon Valley and the enterprise juggernauts, which go head-to-head on an almost daily basis.
When we started Raygun performance monitoring six years ago, we saw the typical path to hyper-growth was already changing. A few breakout enterprises were carving a new path: one driven by innovation and an end-user first approach. Fast forward just a few years and enterprise doesn’t mean big and slow anymore. Companies such as Slack, Atlassian and PagerDuty are redefining the enterprise to take their share of a market that is set to reach $3.8 trillion in 2019.
These “best-of-breed” software enterprises understand their customers, are fast-moving and leverage the cloud to create a new category of enterprise IT: the modern enterprise.
User Expectations Are Shaping the Definition of the Modern Enterprise
The consumerization of enterprise software has been championed by fast, easy-to-use platforms that deliver exceptional value. And when we look at the everyday functionality of software such as Atlassian, now valued at $25 billion, such software isn’t just valuable to a company, it is indispensable to the people that wield them. These tools become so entrenched in a team’s day-to-day, they must understand the end-user at a level the incumbents cannot. As companies replace processes across teams, departments and businesses, this customer-first approach has led to tremendous opportunity for the startups of tomorrow.
As Aaron Levie, the CEO of Box, points out, everyone thought video conferencing was a tired market, but Zoom proved extreme focus and better user experience could build a company worth $15 billion.
Salesforce replaced antiquated sales processes to revolutionize customer relationship management (CRM) software making data accessible across departments to grow to a net worth of $111 billion.
If you’re thinking that the idea of putting customers first will be laughed out of a boardroom, Microsoft CEO Satya Nadella used a customer-first approach to transform Microsoft’s economics, perception and culture. In doing so, he is leading the company away from producing products that people need, to producing products that consumers want. His goal? To convince customers to love the company.
What’s more, transparent pricing models enable a self-service and a “try before you buy” approach leading to a user-driven, bottom-up approach. By removing the barriers to entry, potential customers have the opportunity first to enjoy simple interfaces and seamless onboarding with free trials, made possible by the inevitable move to the cloud.
Image source: TechCrunch
However, although a user-first company like Slack has the expectation that their software is as good as any consumer software, there is still work to do.
High-velocity, bottom-up distribution models like Intercom’s take time to build. Competition is ferocious and even Silicon Valley darlings like Slack aren’t safe from slow movers like Microsoft, which can still force the hand of companies trapped in the ecosystem of their technology. While Slack is clearly worried as Microsoft Teams tightens its grip, many argue there is room for both and both Microsoft and Slack could learn a thing or two from each other about providing a better user experience.
For example, Slack has recently been under fire for frequent outages and security concerns, while Microsoft Teams users complain of slowness.
As more internal processes are digitalized, the need for user-first software plays out in every category of technology providing a trillion-dollar opportunity. As open, integrated platforms start to win over monolithic technology suites, Enterprises that don’t want to be left behind need to start their long march toward being more focused on their end user’s needs.
Enterprises that become customer-obsessed will thrive in the next digital age. Software performance and quality will continue to play an increasingly important role as software becomes more consumerized.
Enterprises aren’t in charge anymore — their success depends on something much more fickle: the needs of their customers.
Feature image via Pixabay.