What can we learn from HP

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Our prospects often ask why should they should select Solix when major players like IBM and HP also offer information lifetime management (ILM) products that duplicate many of the basic features of our product. The answer is that we are singularly focused on ILM, both in terms of service and advanced development. IBM and HP are certainly good companies, but for them ILM is a minor part of their overall product set. ILM customers of IBM and HP will never get attention from the company CEO (unless they are also major users of many other products from those companies). And while these companies certainly have vast resources compared to Solix, those are not focused primarily on their ILM products but rather on their larger product sets. As a result small vendors tend to provide more advanced, best-of-breed products, and that certainly is true of Solix.

Unfortunately the normal vendor selection process fails to recognize these advantages. It is generally remains mired in bureaucratic processes. RFPs fail to differentiate among mature products or identify innovators. They usually are based on requirements that buyers can envision now, often missing the vision for the future. Their feature lists look quite similar to capabilities that vendors can deliver in current releases rather than more visionary features that don’t exist in many products today. The result: Newer, innovative products don’t get considered often citing viability and track-record concerns.

Leaving aside the questions of whether HP’s recent reorganization is good or bad for HP, we can derive several specific lessons from HP’s recent announcements that apply to the question of small vendors in the marketplace:

  • Small vendors are often eliminated from consideration as suppliers based on long-term viability concerns. HP’s sudden decision to kill its webOS-based products including both its new tablets and Palm smartphones just weeks after announcing those tablets and making public statements about its commitment to competing in the tablet market, however, show that big vendors can simply shut down whole product sets without warning. How would you feel if your company had made a commitment to those webOS tablets based on HP’s overall relationship with your company, its size and stability, and its assurances from high level executives of its long-term commitment to that technology?
  • Large companies traditionally have problems keeping up with the leading edge in technology innovation in part because their very size creates inertia. Innovation in large companies, as HP has demonstrated, often focuses on major business moves such as HP’s announcement that it will sell its entire PC division and get out of the PC business while moving into software by acquiring Autonomy. Customers of HP desktops and laptops have to wonder who their supplier will be next year.
  • Small companies with a precise focus often are less vulnerable. Japanese car companies were smaller when they started, but they brought in a new design philosophy and better technology at lower cost. Because they never had manufactured big, high-performance but gas-guzzling, overhead-cam engines, they were free to introduce new, more economical, engine technologies. They are forced to differentiate through innovation. Another example, Tesla has created the first really practical electric car in terms of overall performance, forcing the larger companies to embrace electric power. And the customers of those small companies benefit from that innovative spirit, not just today but into the future. A small vendor with one product set is totally committed to that product for its survival and needs to keep innovating on that platform to stay ahead of the competition and maintain its differentiation.

The overall lesson here is that vendor size does not guarantee stability of a specific product. A small vendor that is focused on a vital product will be closer to its customers and understand their needs for that product better. It will put more effort into meeting those needs, including those that the customers themselves may not understand, because its entire organization from top to bottom is focused on that product and on how it best fits into the overall IT ecosystem. It will provide excellent service because every customer is vital to it. And it will not suddenly abandon its core product set for something entirely new.

 

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