Open Source Commentary from Navica's CEO, Bernard Golden

IT Skills for the Post-Proprietary Era

Last month's newsletter discussed the challenge open source presents to mainstream IT organizations: the impedance mismatch of the post-proprietary era. This month's focuses on the challenges IT organizations will face from the transition to the post-proprietary era and offers six crucial skills necessary to succeed in the new world of software.

What is the Post-Proprietary Era?

It's tempting to deny the impact of open source on infrastructure software; one hears reasons for why proprietary software companies will continue to prosper ranging from “software only makes up 6% [or 10% or 20%] of total IT organization spend, so IT organizations won't see cheaper software as important” to “well, yeah, open source software works OK, but only some customers are focused on feature functionality – the rest want a solution.”

The faint sound you hear is an entire industry whistling past a graveyard.

The fact remains that the glory days of enterprise software growth are behind us and the only tactic vendors have to boost profits and support growth stock multiples is cost-cutting. The implication is clear: fewer services will be bundled with a software license. The panoply of services that today accompany a software purchase will be converted to for-fee offerings – so services like pre-sales support, roadmap presentations, informative marketing, and even direct sales efforts will no longer freely run from the vendor tap.

We may term describe this vision of the future of software as the post-proprietary era. In it, infrastructure software will be open source or quasi-open source – in other words, the infrastructure will be a no/low license revenue area. Vendors will abandon the infrastructure in search of higher-margin market segments.

How soon will this happen? The evidence available today is mixed. The enterprise software industry is consolidating – always a sign of a cost-squeezed industry. Enterprise software companies are desperately seeking cheaper ways to market to customers – witness the blizzard of webinars that arrive in your email each day. However, vendors still seem wedded to the direct sales model, despite its high cost and decreasing effectiveness – a tribute to the clout that the sales force has inside vendors.

Within five to 10 years, it will be clear, however, that the world has changed. Infrastructure software will be freely available to everyone from low-cost vendors. It will be delivered, though, bare bones. Think Fry's. That's the future of software.

IT Faces the Post-Proprietary Era

From surface appearances, the post-proprietary era should be an enormous win for IT organizations. Lower costs, less vendor clout, and more control would seem like a sure bet. The capital previously spent on data plumbing can be redirected toward business-oriented technology and IT becomes a hero, finally recognized for its bottom-line delivery and invited to sit at the big boys' table.

It won't be so simple.

Just as vendors are wedded to the enterprise software model and are painfully being forced to adjust their strategy, so too will IT shops confront the post-proprietary era.

IT organizations have symbiotically adapted to the previous, proprietary era, honing their assumptions, processes, and organizations to a high-cost, high-service, vendor-centric set of best practices. They are in thrall to their vendors: anxiously awaiting diktats from their software suppliers instructing them about what functionality will be delivered – and when; peering into the tea leaves of their analyst reports for clues about vendor directions; wondering what will happen to “their” vendor's products when it is swallowed up by an acquirer.

Far from being set free by the breakdown of the proprietary era, these organizations will struggle to adjust to the new, post-proprietary environment. What will they do when their RFPs go unanswered, their quarterly analyst briefings provide no guidance, their vendor-specific processes are no longer workable? In short, how must they change to be successful in the post-proprietary era?

Make no mistake, change they must. Just as it's tempting to believe in the unending future of enterprise software, it's seductive to believe that working practices will survive unchanged into the post-proprietary era. Remember, however, that at Fry's you get low prices, not personal service. You need new skills for a new era.

Preparing for the Post-Proprietary Era

One view of many open source advocates is that, with the free availability of source code, IT organizations will become software foundries. Each will build up the skill base to customize code and create a bespoke infrastructure. Frankly, that is unrealistic and unworkable. Most IT organizations want to manage technology, not create it.

A much more believable scenario is that IT organizations will modify their current working practices to address the realities of the post-proprietary world. Most will continue to be technology managers and will transform their assumptions, processes, and organizations to address the new realities of software. Their future will hold a mix of proprietary and open source software and force them to create a set of working practices appropriate to the melange of products in their infrastructure.

How can IT organizations prepare for this new era? Here are six crucial action items to get ready for the post-proprietary era:

Examine your product portfolio

Perform an inventory of your current infrastructure. Identify products that will need to be replaced or upgraded. Even if they're proprietary products, recognize that the vendor is going to be trimming the services you've always expected as part of your relationship; they've got margin to protect.

Think about whether you should put off your upgrades or consider open source alternatives. After all, if you're going to be doing more work, maybe you should go with an open source alternative that gives you more control and flexibility.

The important thing to understand is what parts of your existing transactional and business processes will be affected by this new way of doing things and to get ready for it.

Review your infrastructure roadmap

What new applications are you scheduled to begin working on? You're probably going to be using open source for a significant percentage of them. You need to learn how to work with open source. Choose a low-risk application and begin experimenting with an open source implementation.

Identify applications that you definitely will purchase from a commercial vendor. Start interacting with the vendor to understand how they will be to work with in the low-margin future.

Make sure that commercial applications you will purchase are core offerings of the vendor. When margins get tight, superfluous offerings will be jettisoned. You don't want a key part of your infrastructure put into “end-of-life.”

Develop a boilerplate transition scenario process. If one of your applications gets “end-of-lifed,” you need to be prepared – ahead of time – with a thorough transition process that addresses data migration, application integration, retraining, and so forth.

Evaluate your decision and implementation processes

Do you use RFPs extensively? Revisit who creates them and how they're created. Expect that you'll have to do more research in the future. In the past, selection was all about choosing the right provider; in the future it will be about choosing the right product and surrounding it with the necessary services and resources.

Find a good selection aid for open source products. Navica's Open Source Maturity Model® is one option; you can learn more about it here.

Make sure your implementation skills are honed. You'll be responsible for more implementation decisions and actions, so get ready now. Review your code management, installation, configuration, and administration capabilities and understand where they'll need to be modified/improved.

Look at your project management processes

Today, most organization's processes focus on vendor management. Expect that in the future you will be creating a coalition of providers to implement your projects, so be sure to have a project management system that can track and enforce multiple vendor arrangements.

Review your standard project management tasks and milestones and incorporate any new/modified deliverables. Examine where your project management process assumes information and action by vendors and ensure you develop alternative methods of addressing these areas.

Assess your skill sets

Just as your selection and project management processes will need to be upgraded to be ready for the new open source world, so too will your staff skill sets. Many organizations recognize that they require new technical skills; for example, Linux system administration.

Less recognized is the requirement for technology research capabilities and broader project management skills. Crucially, the ability to interact with open source communities is vital to get the most from your open source efforts. Get ready by ensuring that your pilot open source projects address community skills along with technical skills.

Review your service providers

Prepare to use more service partners. As software vendors bundle fewer services for free along with the product, IT organizations will be forced to pay for them. The vendors fervently hope that you will spend these dollars with them; it's more likely that you will use independent providers to ensure objective advice.

Many service providers are not ready for open source software, preferring to stick with the proprietary world. Make sure your service partners are enthusiastic about open source. If they're not, they're not the right partners.

Assess whether your service providers are comfortable working in a coalition. Many consulting firms want to be the conductor and the orchestra; make sure your partners are willing to play a single part.

Takeaways for the Post-Proprietary Era

IT organizations have traditionally excelled at managing vendors. They have over twenty years of skills built to enable them to survive in a high-margin world, in which vendors hold the upper hand, but practice a kind of nobelesse oblige via sales attention, bundled services, marketing roadmaps and the like.

Open source will obliterate that world. Low margins and the concomitant low cost structures will sweep through the software industry. In the near future, the software industry will look and behave very differently.

The transition to the post-proprietary era will be painful – and the pain will be spread impartially. Don't imagine that only vendors are threatened by open source software. It will affect all participants in the IT value chain. Everyone will need to adjust to a low-margin world. Developing the skills and processes for the new world is not optional. Get ready.