Tuesday, February 14, 2006

Reprise: Why does everyone write their own CMS? (and the New ACCU website)

Back in November I agonised about this question. Well, things have moved on and I’ve had the chance to think about the question.

At the time I was grappling with 2 websites - both with proprietary CMS technology. Shortly afterwards, wearing my ACCU hat, we took the decision to dump the sub-contractor and their CMS technology. (A full report is on my website if you are interested.)

We replaced the sub-contractor with Gnomedia who have done an excellent job using the Xaraya CMS system. In just two months Xaraya, Gnomedia plus some ACCU volunteers have built a new website that has gone live this week - see www.accu.org.

While I’m talking about that site I have to thank the team: Tim Pushman at Gnomedia, Tony Barrett-Powell (the ACCU website editor) and Jez Higgins.

Throughout this time I’ve continued to wonder: why with so many commercial and Open Source systems out their do so many people write their own CMS?

Still, I think I’ve started to understand why.

First, it isn’t really clear what a Content Management System is. In fact, talking about Content is itself wrong. When was the last time you bought Content? You don’t go to Blockbuster to rent Content, you don’t visit Borders to buy Content. There is no such thing as Content.

Content is a collective term covering anything but we usually mean text documents. This can be presented as Word or PDF and may be styled as a manual, an FAQ, a How To or many other things. But content also includes sound recordings, video recording and just about anything that can be digitised.

The whole idea CMS is mixed up with Websites, Knowledge Management Systems, Learning Management System and even Learning Content Management Systems. I think many people just want better tools to manage what is on their website.

Then, there is the whole issue of Content management regardless of the web. It is increasingly possible to create text, videos, sounds, whatever, and use that in multiple places.

For example, technical authors working for a software company may write release notes, manuals, internal documentation and training documents. The same topics may be covered in all of these so why duplicate the work?

It turns out there are systems like AuthorIT for just this scenario. So when you talk about CMS are you talking about managing your raw materials or managing what appears on the web.

Bottom line: a CMS does not necessarily manage a website.

Third, a common requirement of a CMS system is to target information at different people. So, on the ACCU website members can log in and access extra documents. On a corporate website different customers may see different information. It turns out that the role of identity is quite important in CMS systems.

And it turns out that identity is itself a hard problem. Sure you can do it small scale on your PC, and even medium scale on the office network, but as you move from tens to hundreds and even millions of users the problem of who should see what gets increasingly difficult.

My friend John Merrells can talk about this for hours. In fact he’s now CTO of a company trying to fix this problem - http://www.sxip.com/.

Finally, as Jonathon Sefton has pointed out to me online and in conversation we just don’t understand the domain of CMS systems. I think this explanation actually covers everything I’ve said so far. The domain is big, the subject mater is unclear and the set of problems is hard.

Yet it appears so easy doesn’t it?

So, everyone’s set of problems is a subset of the whole. It therefore seems easiest to solve your own set of problems. The systems out there all try and solve t0o many for you today so look too complicated.

I think I’ve started to understand why people write their own CMS systems. I have to say, having seen what Xaraya can do, I think anyone writing a CMS is making a big mistake.

Thursday, February 09, 2006

Naked Objects

I first heard about Naked Objects (the Naked Objects website is here) in a presentation at the SPA 2005 conference and have been intrigued since. I finally managed to find time to read the book (Naked Objects by Richard Pawson & Robert Matthews) and I can recommend it. Naked Objects brings a different approach to software architecture.

The book itself is different. Like Tom Peters Re-imagine! it is printed so it looks almost like a children’s book with lots of pictures and glossy pages. In particular I like the use of case studies - I think we in the software professions don’t make enough of case studies.

Both the Naked Objects philosophy and the Naked Objects framework are described. I’ve only skimmed the stuff on the framework, this takes the form of a tutorial section on the Java framework and seems to make extensive use of reflection so it might be difficult to port to some languages.

Still, the Naked Objects philosophy should be applicable in other languages. The approach won’t work for all domains: it won’t work where the application is of a highly scripted nature, where customers must use the software directly (e.g. a ATM/cash machine) or where there is a lot of data entry. Still, that leaves an awful lot of applications where it could work.

Naked Objects makes one very important assumption up front: it assumes the software user is not a dumb automaton but actually an engaged problem solver. This also implies you trust your staff (and if you don’t then why do you employ them?) and that they know the problem domain at least as well as the software - probably better. This allows developers to concentrate on functionality rather than interface or interaction design.

Basically, the idea is to expose objects directly. The objects have user meaningful methods with which the user interacts directly. So, if you want to book a Taxi in New York you put the New York object together with the Taxi object. In some ways it is taking Object Orientation to the extreme.

I’m not sure how this all fits with good software interaction design as described by Alan Cooper (The Inmates Are Running the Asylum) - I think in a domain where interaction design was key you probably won’t use this approach. However, where you can position your users as problem solvers the consistent interface pays off.

Once you start treating your users as problem solvers you assume that: they know best how to solve the problems, rather than try and think of everything that could happen and provide a way of dealing with it you provide the raw objects and let the users work out how to do something. And with that a large part of your work goes away, making you more productive; and because you are treating you users as intelligent beings they get more satisfaction from work and do a better job.

Overall I think the Naked Objects approach is very promising. It seems a particularly productive way of working. Everything I heard at SPA and in the book persuades me that this deserves more attention than it is getting.

Sunday, February 05, 2006

Events dear boy, events

A friend comes to visit me and tells me he is considering doing PhD research on the gap between corporations stated policy on corporate social responsibility and their actions.

Tony Blair looses a vote in the House of Commons by one vote.

And in Northern Ireland the Independent Monitoring Commission suggests that while IRA leadership is committed to peace and politics the members on the ground are still holding weapons and engaged in suspect activities. (Report in the Economists)

(And yes, if you ask I found the same pattern in Russian history.)

What have these things in common?

They show what happens when the top of an organization - the leaders and managers - gets separated from the bottom - the workers.

Such a situation isn’t automatically bad, it can be a good environment for innovation and risk taking. Neither do we want a situation were managers are standing over workers compelling them to do something

But at the same time it does show what happens when strategy and operations become devoiced. Strategy may be the “helicopter view” but often it is the “expected helicopter view” - how do we know what is happening rather than what we want to be happening?

It is very easy for leaders to say “We will do X” but for the workers on the ground to ignore the message. Perhaps they’ve heard X, Y and Z in recent years and have started filtering our management messages.

How can we expect our leaders to lead if they don’t know and understand what the issues people on the ground are up against? Nor do they know the solutions the people on the ground are implementing, or whether they are compatible with the espoused strategy.

Nowhere is this truer than in the realm of knowledge workers - and in the knowledge workers I know best, software developers. It is said that a developer makes a decision every 15 minutes. But is this decision compatible with the strategy? Does it move us towards our goal?

Of course the developer can’t stop and ask the managers view every time, they need to make a decision - they probably don’t realise they are making the decision a lot of time. To ensure the right decisions are made the two need to have a close dialogue.

This dialogue can only happen if both sides make space and time for it. All too often software developers don’t know they need it, or avoid it because they would rather be coding. And managers frequently fail to make the time for it - perhaps because they are busy making strategy. There need to be occasions were both sides can talk and explore these issues.

The need to bridge the gap between the two groups in an organization is never more acute than when change is happening. My examples above discussed companies trying to take their social responsibilities more seriously, politicians trying to change the law and society and a terrorist group changing its mode of operation.

I once worked for a company that decided it should be CMM level 2. They hired some consultants to write the process. They appointed some “change champions” who then rolled out the process, and they audited the whole thing to make sure it was what they wanted.

Trouble was, the processes didn’t fit the work people did. For starters it was a “one process fits all” approach. Someone once likened it to “pouring quick drying cement on the rails of progress.” It wasn’t too long before the company saw software development as a problem, people were to be cut and work offshored. And they quietly dropped CMM along the way.

I think its also fair to ask if this is simply a break down in communication with the top of the company failing to communicate to the bottom, or whether, it is actually possible for those at the top to impose their strategy and vision on others by merely repeating the message. Perhaps, in order to be part of a vision one must play a role in formulating it.

It all reminds me Harold MacMillan, British Prime Minister 1957-1963. Once asked why his Government hadn’t achieved everything he set out to achieve he said
“Events dear boy, events”

Tuesday, January 31, 2006

I read (Russian History and Change)

One of the readers of this Blog told me the other day “You read a lot!” – well I’ve always tried to deny it but I guess he is right.

There was a time when I used to boast about reading a lot, then I discovered that HR departments and the like looked down on this activity. Apparently it’s a sign that your a little anti-social, not a team player, an individualist. And perhaps theoretical rather than practical. So, please don’t mention it in an interview.

Truth is, as Robert Redford said in Three Days of the Condor: “I read.”

Not sure if I read a lot, or if I just squeeze reading into time that would otherwise be lost: on the bus, the tube or when I’m waiting – for anything! I’ve never considered myself a fast reader but maybe I am.

However, I have amazed myself with the speed I’ve read my latest book:
A History of Modern Russia - 500 pages have rushed by in a month, helped by two transatlantic flights and a couple of days off work with a stomach infection.

I usually have two books on the go at any one time, usually a fiction novel for light bedtime reading and something more serious for daytime reading. Usually the second is a business, technology or software book but every so often I like to take a break with something different like history.

However, as I read this book I became convinced of two things. Firstly, Russian’s are their own worst enemy, and second, there is a lot for managers and marketers to learn from twentieth century Russian history.

One of the themes of the communist government was the idea that technology could fix their problems – a new type of week, a new tractor or factory and everything would be OK. Like modern managers they tried to fix a social or economic problem with a technology. Unfortunately this is all to common.

Two stories stuck out for me.

First one, in early years of the Communist Government there was a food shortage. The Government ordered that all food should be handed over to the central distribution system on year. Since there wasn’t enough to go around they wanted to control distribution to all. They repeated this in following year third year there was a disaster.

The peasants who worked the land had been removed from the market and distribution system. The Government knew best. Not only had their incentive to farm been removed but they had been told that “management knew best.” So they simply stopped looking after the land, there was no food from the peasants for the Government collect and distribute.

The second story that stands out is about Gorbachev’s change programme. To start the change he needed to change the story of communist success fed to the people with the story of failure and the need to change. Of course this upset people who felt threatened.

Next he proceeded to change the personnel. But the scope of the problem was so large that simply changing the managers didn’t fix the problem - not all of the managers followed through and introduced change. The real problem was that for years people had been conditioned to keep their heads down and not try anything news.

It is over 20 years since Gorbachev began his reform programme. I don’t think I ever appreciated just how difficult his position was or quite what he was up against. He had allies in the change programme but he also had enemies who wanted him to fail. Nor did all his supporters agree with one another.

So often when we reads about change in companies it sounds straight forward, I think the change in the Soviet Union reminds us just how difficult it is.

Sunday, January 29, 2006

A few of my things I like... and one I don't

I’d hate to think anyone thought I was a pessimist. I don’t want this blog to be a moaning blog so its time for some recommendations. After all, one of my “not a new year’s resolutions” is to give people more positive feedback.

Sorry for those of you outside of London, I live in London so these recommendations may seem a little London centric - at least one isn’t.

Dav Flavin exhibition at the Hayward Gallery . I like Minimalist art and this is the best such exhibition to come to London in recent years. Its already been to Washington, Chicago and Dallas, it goes onto Paris and erh, somewhere else in Europe I can’t remember.

City Car Club - not just in London, and there are other car clubs around. I got rid of my car over 2 years ago now. I travel mostly by public transport but when I need a car I can rent one for an hour or a week from the Car Club. I don’t have to care about insurance, servicing, tax, fuel and so on. Costs me about £1,200 a year in membership, rental costs and for occasions when I hire a regular rental car. Compare this with the AA’s estimate of £5,000 a year to run a small car. Saves me money and time.

There are three cars in my area and I have the choice of two types. I’m hoping they will improve their customer communications this year - in the past they’ve had a tendency to move cars, replace them or even remove them and not tell the members.

(I’ve been meaning to blog about the car club for a while but there is always something more pressing.)

Three restaurant recommendations:

  • The Glasshouse in Kew. Almost a local for me, easy to get to but not that cheap (£110 for 2 people, three courses with wine). Been here a couple of times in the past two years for celebrations.

  • Savoir Fair on New Oxford Street - only discovered this a couple of weeks ago. Its like one of those little unpretentious restaurants that seem to exist all over Paris - although it has a downstairs that makes it a bit bigger. Food is classic French but unlike so many French restaurants in London they are not exclusive, a good selection of New World wines. Relatively cheap for this part of London (under £30 if I recall correctly) but good quality.

  • Brasserie Roux - this has got to be the greatest bargain in London. It’s a Roux franchise inside a hotel so you have to hunt it out inside the Sofitel on Pall Mall. Again, two visits in the last two years have been equally good. The food is great and if like me you go for the pre-theatre menu its is a bargain - £20 for three courses and half a bottle of wine per person. At this price, with this quality it is unbeatable, if it is I’d like to hear where!

The website I’ve just referenced London Eating is pretty good too, only wish they could remove restaurants when they cease to be.

On the subject of websites, I’ll let myself go negative - O I know I said I wouldn’t! But this one is so bad.

Went to the Royal Opera House website to book some tickets before. This site is awful, I’ve used it before and it was awful then. If ever a website was developed to deter people from booking, to give the impression that “we don’t need your sort here” this is it.

As much as I love Opera and Ballet I think the Royal Opera House does its best to deter people and make it an exclusive pastime. The website excels at this. Why o why did successive Governments repeatedly bailed them out?

Thursday, January 26, 2006

Strategy, Architecture - Just Do It! (Or, I am an Army of One)

Do you ever find your living out the examples in the books you read? I think I am...

Arie De Gues says:
“The fact is that the word strategy has tends to be misused. It should not be a noun; you should not ‘have’ a strategy, in the sense of a document which the organization follows. Rather, strategy should be a verb: strategy is something you do, rather than something you have.” The Living Company


(Now there is a lot I could say here about how this discussion of nouns and verb links up with Patterns but I’ll leave that for another day.)

Another strategy thinker, Henry Mintzberg, also rejects the idea that strategy is a plan. In the The Rise and Fall of Strategic Planning he made the case that strategy is not a plan you draw up and execute. He cited the case of the Canadian military, one study showed that they produced plans when they had nothing else to do. When they had something to do, like fight a war, they just got on and did it.

“the organization either planned or it acted; otherwise the two seemed unrelated. When the milirary has nothing to do, it planned, almost as an end in itself. ...
But when the Canadian military did have something to do (such as fight in Korea), it threw its plans aside and acted.” The Rise and Fall of Strategic Planning

To my mind much of software design is like strategy. (And by design I’m talking about the internal architecture stuff). Having an architectural design is a something you might want to do when you have time but your design will always evolve. Who was it that said
“No plan survives contact with the enemy”

(A quick Google search offers von Moltke or Heinz Guderian.)

What is important for both business strategy and software architecture is that the whole team know the direction, the objective and are fully on board. The planning, the designing, only serves as a learning exercise, what is important is what you actually do.

In the “plan as noun” world you can’t really get this. So often a few chosen ones - maybe just one - devises a plan/architecture and presents it to the others and say “Here it is, all we have to do now is make it”.

Everyone can have their own copy, they may even get to “sign off” on it so they can be help accountable for building it but this method has a number of faults
  • Arie De Geus points out: those who aren’t involved in creating the plan will take longer over actioning the plan
  • Mintzberg points out that way doesn’t instil motivation, after all, your building someone else’s grand design not your own
  • Mintzberg also points out there may be errors in the execution of the plan, of course, if your designers are good enough they will have anticipated these and allowed for them, they plan will be fool proof, or at least allow enough time to fix it
  • Most of all the environment and requirements made on the plan change

So for me, I believe strategy and architecture are much more about discussion, I want to hear debate when I am planning. I want to use the whiteboard, I want everyone to join in at the whiteboard. When we produce something I want it to be shared by all. And I want everyone involved, those who will produce the product and those who will authorise it and allocate resources.

Maybe I’m sounding like a broken record, I’ve said much of this before in my essay “An alternative view of planning” but I’m drawn to these ideas again because of where I am right now.

As I said a couple of weeks ago my project is currently “stood down” - I won’t go into detail, enough to say I still have a job and a role but not a lot is happening on the project.

One of the things I’ve been asked to do is to “set a vision” and “create a strategy”. Thing is I’m a team of one, there is nobody to discuss this with, only myself. And instead of white boarding with many I’m going to PowerPoint the whole thing.

This is lonely and depressing. I end up running over the same old ground. In a couple of weeks I’m supposed to present (PowerPoint) something to some folks who’ll decide if we get to move the project forward.

The thing is: I’m like the Canadian army, I have nothing to do so I’m planning.

Sunday, January 22, 2006

Who are you?

Its all too easy for a company to loose track of just what its customers want. Without customers your nothing. As a Product Manager this should be one of my top (if not the top) concerns. It should be the thing I’m thinking of when I go to work each day - what do my customers want?

As if I needed reminding of this there was an interesting interview in last weekends Financial Times with the founder of Boden - a niche mail order clothes retailer that is based a short distance from where I live in London. (Subscription only I’m afraid.)

Boden know who their customers are. They really know them. They know what style they like, why they buy mail order, who buys, their income and much more. There is a lot of competition in clothes retailing so this company would not exist if it didn’t know and understand its customer.

I wish I knew my customer half as well. It is difficult getting to know your customers but maybe I should redouble my efforts.

And that brings me to this blog. Who are my customers here? Who are you the readers?

One the one hand it doesn’t matter. This blog is by me, largely for me. The writing of it is the valuable bit, I’m trying to make sense of the world around me.

But I do wonder about who my readers are. And occasionally you surprise me, a comment on the blog, or an unexpected reader emerges. So, what do I know about you?

Blogger has their stats switched off but I do have three sources of information on my readers:
  • Site meter gives me some basic stats on my readers

  • The picture of me in the top right comes from my website so I can see downloads there, and some of you go to my website after reading the blog

  • Conversations with people who read the blog

So what do I know?

You are mostly British, the second largest group of you comes from the US. Surprisingly Norway takes third place and although Norwegians are far behind American’s they are a long way ahead of everyone else.

Over 50% of you use Firefox. Either, this means that Firefox is taking market share generally from Internet Explorer (40% of you) or my readers are biased towards Open Source - my money is on the latter. (For the recond, I'm a Firefox user too - maybe I'm distorting the figures?)

Although this doesn’t extend to you OS, 92% of you use Microsoft Operating Systems, 4% of you are on Linux and just 2% on Mac OS X.

I know some of you read me via RSS but I don’t have any stats on such readers, it seems weekly visits can be anything from 40 to 360. Just what is a visit? Do search engines robots get countered? How long do you have to stay to count? And what do you do when two different counters give you widely different figures?

So, I have an idea about how many of you there are, and an idea of what technology you use but what do you like to read about?

To date I haven’t worked that out. Once or twice your comments have surprised me, things I thought nobody else would be interested in have had you logging you opinions. Guess that shows I need to work on knowing my readers. A job for a Product Manager!

Tuesday, January 17, 2006

Return to Conway’s Law

Are software architectures copies of the organizations that create them?

Often this is true but is it always true? And more importantly is it a good thing?

In 1968 Melvin Conway wrote a paper that discussed this topic. It has since been passed down as developer folk law that.
“If you have 4 developers writing a compiler you will get a 4 pass compiler”

Or,
“If you have 4 developers writing a GUI based system you will have 3 ways of doing anything (mouse, menu and shortcut key) - only 3 because someone has to manage the others.”

There is even a pattern by Coplien and Harrison (Organizational Patterns of Agile Software Development) of this name that describes the situation in more detail.

Trouble is, things are just more complicated than that.

What if your company is bought? What is the relationship between architecture and organization then? Or, if your development is outsourced? What if you are geographically separate? What if you adopt Extreme Programming?

And, have things changed since 1968?

In an attempt to understand the “law” and answer some of these questions Lise Hvatum and myself facilitated a focus group discussion at EuroPLoP 2005. The resulting write up from both of us is now online at on my website.

So what do I think about Conway’s Law?

Well, I don’t think Conway’s Law is a law, in that much I agree with Kevlin Henney, it really describes a force. And the name of the force is Homomorphism.

I believe Homomorphism is a strong force, I believe it is always present, I believe it was stronger in the 1960’s but it is still strong and most importantly it is self-reinforcing. I also think its the default architecture for most organizations.

I agree with Neil Harrison, in the ABC case study the organization changed from one structure to another and the architecture followed, they stayed within "Conways Law."

The big question for me is:
  • Which comes first: Organizational structure or Architecture?

Conway was right when he said that the design that occurs first is seldom the best. Question is: how do you create a better one when the existing one is self-reinforcing?

More than ever I believe that someone who claims to be an Architect needs both technical and social skills, they need to understand people and work within the social framework. They also need a remit that is broader than pure technology - they need to have a say in organizational structures and personnel issues, i.e. they need to be a manager too.

All too often technology companies respect those with technical skills and ignore the need for management skills, they reward those who are technical more than those with good management ability.

When I think of the really good technical people I know, myself included, sooner or later they all come to the point where they realise that to solve technical problems requires them to work outside of the technical domain.

Sunday, January 15, 2006

I don’t understand Mergers and Acquisitions

As regular readers of this blog known I read the Financial Times daily. Never a day goes buy without some story about company X buying company Y, or merging with Z, or problems with the purchase, or problems with the result. Thing is, given all these problems I don’t understand why companies do it.

There has been plenty of research in the last few years that show is how company mergers and acquisitions destroying shareholder value. Merging company X and Y is expensive, time-consuming and distracts the management from running either business.

It is often said about national political leaders, specially US Presidents in a second term, that when it becomes difficult to achieve anything domestically their attention and efforts are redirected to foreign policy. You can’t focus on too many things, when you focus overseas you miss things at home - this happened to Tony Blair before and during the Iraq war.

I think something similar happened companies. Rather than work creating growth, improving the company or making it more efficient leaders look for an external activity.

(I know a lot of my readers work in the software technology fields so a word of encouragement, this blog entry does come back to software and technology at the end.)

To be sure, it isn't always the companies that come up with the ideas for mergers and acquisitions. Investment banks (who often seem to function more as financial consultancies) make a lot of money mergers and acquisitions, consequently it is often bankers who dream of the idea of company X buying company Y. They then go and persuade the managers at X to do it and a their bank a lot of money for advice.

For example, after months of saying future investment and business growth would come from developing countries and South America the Spanish telecoms operator Telefonica decided to buy O2 recently. O2 is big in the UK, Germany and Ireland, hardly developing countries and defiantly not in South America.

Another current takeover that I believe will end in tears is the proposed purchase of Virgin Mobile by NTL. It seems that NTL have decided on a grand new strategy called a “quadruple play” whereby they will sell their customers cable TV, broadband Internet, telephone services and now mobile telephone services. This is a classic Grand Strategy but I believe is destined to fail simple operational reasons.

This is the NTL that has just emerged from Chapter 11 bankruptcy and the same NTL that is in the middle of merging with Telewest (another former bankrupt). Neither NTL or Telewest have particularly outstanding reputations.

Indeed I once spent three hours trying to get NTL to fit a telephone line to my house only to find out they were not fitting any more telephone lines. And Telewest once advertise their new broadband service close to my house but did not actually provided it in my area.

Indeed NTL and Telewest may be cheaper compared to BT but their customer service is abysmal. I don't know of anybody with a good word about NTL or Telewest customer service. (Not that BT customer service is outstanding either.)

Virgin on the other hand may not have a spotless customer service record (think of Virgin Electric or Virgin Trains) but are pretty good generally (think of Virgin Atlantic). My guess is there is a culture clash on the way.

Regardless of culture clash I would expect NTL to ruin the customer service and operations of Virgin Mobile. Consequently don't expect to see much customer growth.

And talking of their customers, what do the customer bases of the two countries have in common? Virgins phones are predominantly sold to younger customers with few responsibilities i.e. teenagers and students, while NTL's customer base is home owners. I don't see much prospect of cost selling.

Another recent deal that doesn't make any sense to me is Boots merger with Alliance Unichem.

Boots has been in trouble for some time, they used to be the safe brand that all Brits went to for medicines, soaps, shampoos, makeup, etc. Two forces have conspired to undercut Boots's market.

Firstly supermarket retailers such as Tesco and Asda-WalMart started selling the same goods at lower prices. Secondly, Boots value lay in its brand, the rise of more branded goods which could be bought at any outlet meant the Boots brand was less necessary for it purchase, and brands such as Superdrug and Tesco could offer a similar reassurance at sale time.

So at the second or third time of trying to respond Boots has decided to merge with the arrival, namely Alliance. But what will this bring to Boots? Sure they will have more purchasing power to demand lower prices and their suppliers but will they be of to match the purchasing power of Tesco and WalMart? Is the scale the answer?

Neither will the deal do anything to the Boots brand. If anything it will confuse managers who now have two brands to manage and in time it will confuse customers.

Obviously things are more complicated than this and I don't have the information Boots and Alliance managers have, but from where I sit Boots would be better off concentrating on improving its operations and supply chain so it can compete with Tesco and Superdrug.

Of course there are good reasons for mergers that may make the pain worth doing. For example if your company has a surplus of something then maybe buying someone to use that surplus might make sense.

For example, suppose you have an established sales force and customer base. Over time your sales force will sell all of your products to all of your customers so will be nothing new to sell. Buying a company with a good product and a weak sales force may be good for both sides, your sales force get a new product to sell and the bought company gets its product sold.

Another example: suppose your management is particularly good, say they are good branding or supply chain management, then perhaps you can use their surplus skills in another company so you buy it.

Takeovers also make sense in private equity. Private equity and Venture Capital investors buy and sell companies all the time - that is their skill. No company is bought without a plan to sell it and one frequent route of exit (although not the most common by far) is to float the company on the stock exchange - an IPO. Trouble is, to IPO a company it needs to be big enough to float, consequently it is common to see private equity owned companies buying other companies to bulk up in the hope of a flotation.

This might have been happening at QinetQ. (No don't ask me how to pronounce this name, I usually say “Q i net Q” but I think I once heard it pronounced “Kinetic.”)

About 35% of QinetQ was sold by the British government to the Carlyle investment house with the intention of floating the company on the stock market. Since then the company has made several purchases of related companies. Of course this isn't just about bulking the company up for flotation, it can be about creating a more rounded company and one that will survive over the years.

The thing is, many of these mergers are explained under the banner of “getting technology”, “synergies of technologies” or “getting access to knowledge”. In the software world these explanations sound good usually don't hold water.

About 1994 Computer Associates (CA) bought the Ingres database company. They bought the product sure, they bought the team that developed the product but within a few days of purchase the team had walked. In this industry it is more the people than the product that are important, takeovers often scare people away.

Neither is it is simple as buying the technology and using it. Software is complex stuff and marrying a different code base to yours can be a serious undertaking.

Back in 1997 Netscape decided it's application server needed a boost in the market so they bought Kiva. They then forced the two products together, that is they forced to code bases together. I'm told by people familiar with the code that it was something of a disaster.

Of course time went by and eventually Netscape was carved up by Sunand AOL. This time Sun attempted to merge Netscape server code with its own products resulting in another code mess.

Merging code bases doesn't happen overnight, it takes time (say 6 months), time you can spend developing new features anyway. When you merge a second code base you might get a whole bunch of new features but your also get a whole bunch of new bugs, customers see a more complex product, and under the hood a lot of consistency is lost, consequently future developments will be slow down.

Business people are familiar with the concept of culture clash in merged organisations, and they know about the need to consider different corporate cultures but how many of them really understand the difficulties of merging similar but different technologies?

So there you are, some of the reasons why I don't understand mergers and acquisitions.

Wednesday, January 11, 2006

Bringing the last three entries together: Customer philosophy

OK, I’ve blogged a lot in the last few days. Partly that is because my project at work is “stood down” so I have more time on my hands. Secondly, its because as I started to write the entries I realised I was actually explaining my “philosophy of the customer.”

It wasn’t clear to me when I wrote the first entry but somewhere between the second and third I realised I was explaining a belief of mine. A belief that has come about through experience, reflection and study.

At the moment this philosophy has three points, it might expand in time, see what you think.

  1. Tell customers you are there

    It is not enough to exist, people need to know you are there. If they don’t know you are there how can they do business with you?
    (Of course, simply advertising isn’t the answer: you need to know who your customers should be and where they are likely to be looking.)
    See: 2006 Arrives...

  2. Be easy to do business with
    If you put obstacles in the way you will loose customers. Obvious but many companies do it.
    See: Websites are getting worse

  3. Choose your customers
    There are some customers, some work, you don’t want to do. No matter how much money they offer they are bad for your business.
    See: Railtrack

I feel there should be a fourth and fifth point but I’m not sure I understand them well enough yet to include it in a philosophy. At the moment it is something like:


  • You need a stream of new business - repeat business is easier to get than new

    business, don’t rely on repeat business alone; you will end up doing the same work again and again, you customer base will slowly shrink and you won’t be exposed to new product and demands.

  • Known your customer - and don't let others get in the way