Erik's last day (not really)

One of my greatest colleagues, our Sales Director Erik, had one of his last working days today. It is in many ways a sad day since Erik is both a huge asset to the company and a great colleague.

But all isn't lost. Erik will still have a major role to play in it's learning in the future too. He is joining our company's board and will still be involved in growing and evolving our company in years to come.

Still, we can't deny the fact that Erik has been responsible for bringing in a majority of our customers and business single handed. Luckily we now have a large enough team of great employees to fill the gap!

The 25$ ERP system

My last post touched briefly on an observation I suddenly realised could be something to write about; some well-known figures in the SaaS industry seems to be in high demand in India and China. This suddenly reminded me of something interesting I've been reading a few articles about lately: the growing car industry in the two largest countries in the world.

For the last couple of decades India and China has been very eager on attracting the biggest car manufacturers in the world. Most of the bigger players in this industry are well established the region and are now competing in what effectively is the worlds second biggest car marked. But the Chinese had a plan; by attracting foreign competence, they have also successfully managed to establish a significant local car industry. There are now for instance hundreds of Chinese car companies, and it is believed that the Chinese car industry is about to surpass the German industry in terms of volume.

This enormous, growing marked has also sparked another race. A race to produce really, really cheap cars in order to open up an enormous market. India's Tata Motors plans to launch a $2,500 car next year, about what a moped costs here in Norway.

So why is this relevant to the computer industry? India and China is attracting an enormous amount of IT companies these days. And just like with the car industry we will soon see that India and China will be some of the biggest players in the global computer industry, just like they will be a massive exporter of cheap cars in a few years.

Another, and in my opinion even more significant, reason takes us back to the start of my article. How do you produce really cheap cars? Or cheap clothes? Or cheap electronics? Or cheap toys? Really low production costs. Labour cost is of course the most common discussed advantage of the East. But if you want to create a really large company that sell really cheap cars in a global market place you also need a lot of computer systems supporting your operations, also known as ERP systems. And just as with labour, you want it to be cheap. Oracle isn't cheap. SAP certainly isn't known to be cheap.

So my prediction: in a few years we will see Indian and Chinese 25$ ERP systems - based on the low cost SaaS delivery model.

Is Microsoft getting it?

In December I published a post that slightly slagged off Microsoft Learning Gateway for being outdated and not getting the message from Ray Ozzie: Software as a Service. And Indeed it seems like Microsoft is pouring resources into their services strategy. Microsoft SaaS Architectural team seems to be receiving a lot of focus. They just released a sample application, Litware, and Gianpaolo and Fred Chong is spending a time in China and India (which I believe is quite significant but I won't go into that here).

Microsoft's latest announcement is SaaS Incubation Center Program, a global initiative to help independent software vendors (ISVs) adopt the Software as a Service (SaaS) delivery model. I've noticed that some ISV's have allready been working with Microsoft on this, for instance at the Danish Microsoft Innovation Centre where CMS vendor Sitecore worked on a SaaS proof of concept a few weeks ago.

But still, it seems that Microsoft's previous technology dominance is forever lost (If you haven't already done so, read "Microsoft is dead"). And even if my employer might be the biggest, Microsoft technology based Software as a Service vendor in Norway, we aren't exactly being run down by Microsoft. The only Microsoft representative that keeps calling me is selling software licenses. There is some cruel irony to that.

What do you think, will Microsoft climb back?