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Chasing the Long Tail in IT development

This November we were very fortunate to have the possibility of interviewing Frederic Richer, EMEA Operations Responsible for Serena Software, as he enlightened us on various interesting themes. If your are wondering what has a tail to do with IT, please read the full interview: Richer’s explanation is not only clear on that point but also on other intricate aspects of the current IT market like business users’ empowerment through new technologies.

1. Please introduce yourself to our readers.
I am Frederic Richer responsible for operation across Europe, Middle East and Africa (EMEA), I have been working for Serena for 6 years, the last 5 years as head of European operations, so I got through all the changes that Serena has been through in the last nine months, from the change of business to that of the central administration.

2. In practice, you have been a witness to the various changes Serena has known lately. Could you tell us more about Serena’s mission throughout the years?
Serena has been focusing on software, not for providing the development tools themselves but for providing for example Application Lifecycle Management tools that helps you move through the application lifecycle from the initial requirement over the design phase, construction phase, the verification phase until the implementation phase. It is also helpful for making sure that every single step of that lifecycle is traced so that you can have control over the whole lifecycle. We have run Application Lifecycle Management (ALM) tools over the last 27 years providing IT the support needed to give efficiency, to make sure things are made the right way.

3. Is the last year’s acquisition important for Serena’s strategy?
Yes, on top of the ALM support we added a Project Portfolio Management (PPM) solution one year ago from a company we acquired, which is called PacificEdge. It gave us the ability to balance the resources against the request so that you can make sure the resources meet the needs. For example, if somebody has a great idea for a new application, a project manager has to understand if the resources he/she has match the requirements for building an application. If she/he actually has fewer resources than what is needed, it is necessary either to have a budget increase and hire more people or to talk about the specs and the project more, so that it can be scoped down and fit into the existing resource scheme.
It also helps you say: these are all the projects that we are running, and take a look at the total portfolio. Not as most people do: they approve a project and then they kiss it good bye and wish it well and hopefully it will eventually arrive. The portfolio solution looks at all the projects that are on their way in a constant basis and it measures whether the projects are still inline with the expectation, for example the timing expectation or ROI perspective.
So we added that to our offer, in fact with the PPM solution we help our clients focus on the right projects this means the projects that have the highest return on their expectations.

4. Are the ALM and PPM solutions integrated?
We have an integration between the lifecycle management and PPM. The nice thing if you can combine those two is an increased ability in managing projects. Typically, when people today look at their projects, at the beginning of the project they do an estimate of how many man hours or days/months/years are required to finish that project. Then they compare the hours that are written against the project, so, for example, people fill in time sheets. The problem with that approach is it gives a very limited perspective: you can know that you have burned 90% of the time that you have estimated to fulfil the project but you do not know if 90% of the time actually represents 90% of the tasks. If you combine PPM with ALM you can off course go down and see what tasks have been performed against the expectations and compare it with the time scheduled against the project. Based on this, one can decide if the budget is alright or needs an increase in order to realise all the tasks desired. The integrated solution really helps people manage the whole it environment much better.

5. What is the basis for all this?
In the middle we have something which is called Team Track, a process engine. Initially and for development purposes most people have used it for issue and defect tracking, and these is how we positioned TeamTrack for many years, unfortunately I should say. Because we have learned something more from our customers – for example our customers helped us understand why they need project portfolio management so they kind of forced us to buy a PPM solution.
Now we learn something again from them when we look on how they used TeamTrack in the past. We have customers that used TeamTrack for the documentation of start up and shut down procedures in Power plants, which is very far away from issue and defect tracking. We have customers who use TeamTrack for mobile device configuration: how should the mobile look like. Then again we have customers that use TeamTrack for package-cash reimbursement or for holiday requests. So we learned that people use TeamTrack in many different ways than what we envisioned first.

6. This was a learning point for Serena.
All the things that we represent we learned from our customers. Initially we were very focused on Application Lifecycle, and our customer said it is not good enough: we need to overview all of our projects not just how one project runs but we want to know how all projects run, so we added PPM. Now we learned something else that one can use TeamTrack for something completely different. We learned that from our users and now we have a very different business opportunity than what we envisioned first. We enriched TeamTrack, the new version that comes up will be called Business Mashup, the Mashup Composer is the first thing that you can see from the new suite.

7. TeamTrack was one of the main focus of your Las Vegas Conference in 2006, from what you are saying we understand that Mashup Composer is an evolution of previous and existing technology. In practice can we say that Serena’s evolution is mirrored in the tools evolution?
Yes, that is the perfect description. A couple of years ago we launched an application that can still be downloaded for free from the Internet: the Prototype Composer. Mashup Composer is pretty much making use of the same technology: it has a beautiful UI, very intuitive; it is easy to understand and is easy to work with. We use that front-end for TeamTrack, which is a slight upgrade but it is not a deviation of our strategy. We worked on that and the Mashup Composer is improved by the UI functionality and we also worked on system’s persistence communication. Before when you looked at TeamTrack very often it was a people workflow: somebody has something and needs to pass it to a system, the system then performs the task and then passes it to the next person and so on, but there was no orchestration between two systems, so we worked on things like web services. This is the next wave we are now after.
Are you familiar with the Long Tail concept and Chris Anderson’s book?

8. We are familiar with the main concepts, but it might be better to introduce it to our readers.
The author, Chris Anderson, focused in his research first on the music industry and on the impact the new technology, the Internet and all the related activity, had on the business and what this will mean for future. When you look 20 years ago at how music was sold, and it is still the predominant model today, you only have a limited number of music titles in a music store, simply because it has a limited space. There are many more music titles in the world than any possible space can host. Because it was very expensive to produce music and the space to sell music was very limited most people focused on the hits, the blockbusters. Now you have the following that everybody can produce music or videos, as we can see on YouTube, plus you have nearly unlimited bandwidth and everybody has Internet access at a flat rate that takes away the problems with the production but also with the distribution. When you now look at the curve for those hits there is a very high revenue stream (see diagram above for an example of Long Tail in IT) in which all the hits are on the left hand side, because a few number of hits produce a high volume of sales. For example Rapsody that is an online music store, they have 2 million titles in their DB, that customers can buy and download online, and how many of those titles the customers download? My estimation was 8%, but in reality is: 98%! Pretty much every title is downloaded per month. So there is way more demand than our current system can satisfy.

9. The music market is quite concentrated on the first titles in the tops.
In fact, Chris Anderson looked as an example at the number 100000th title, not the first, not even the second, and saw that it was downloaded several thousand times a month, the same for the 200000th and 400000th title. So there is a market beyond the blockbuster market.
Turning back to IT, the IT with development jobs focus on the big and hairy tasks: the next billing application, the next training application, but there are so many application demands that they will never be able to fulfil! Unless we do the same as in the music and video industry: we give the people the tools to produce their own videos and music, and we make sure that people can deploy it wherever they want. The Mashup Composer has a very simple, intuitive GUI, people can easily play with that, and build their own mashups effortlessly and easily do systems to system communication.
A classical situation is that of SalesForce.com, an on demand CRM application, that does not support credit checks, which is quite an often task to fulfil when you got a new customer. In my organization, if we do not know the customer we do a credit check before we send the proposal out. Before it was always a very cumbersome process because you had to phone call somebody, or just enquire a lot. Now, as Salesforce.com has a web service and Dun and Bradstreet, the company that does credit checks, has a web service as well, all you need to do is go to that web service and combine those two web services and generate. The user will get an automatic action as the new application goes to the D&B website, it checks if they have the credit rating, it brings the information back and confirms it is good and the offer goes out. In a traditional world of web services this was very cumbersome because you had to be a java programmer or a .Net programmer.

10. So now business people can build business workflows themselves?
Yes, the way we do it is by giving them the opportunity in a graphical way to combine two web services, without Java programming. I will be honest with you, it is not simple, it is not for everybody’s use, it is not that a CEO could do it by himself. You need to have more information. But what we think is that a BA, someone that works a lot with excel and writes complex macros and so on, for her/him it will be simple to combine the two services, she/he definitely does not need to have Java or .Net knowledge any more, it is just combining web services via a graphical user interface, no JAVA programming required.

11. Who will be the ones that will benefit the most?
I think the benefit can still be to both: the central IT department / Development department as well as business users. If I look at the scenario, before we had a situation in which the business users went to the IT department/development shop and asked for an application, and the IT development manager came back and said of course, but it takes 3 years and 2 million euros to be implemented. From the IT department side it is different: they do not want the business users to deploy their own applications because they believe that they will ruin the IT infrastructure.
We need to say: shadow applications already exists! I met a client that said he had 6000 applications outside his control. There are a lot o applications, from excel sheets to macros created by the people which are not from IT anymore, it becomes more and more often. The new generations have more IT knowledge. The developer says: unfortunately I can not work on it, and if the business people can do it themselves they won’t wait. What IT can do is provide the tools to the business users and build the process around it.
We said before that people can download Mashup Composer for free as well as Prototype Composer. So they can write their own application, they can test their application, but before they deploy it, they need to pay. The way we do it is bring it up to everybody that wants to use it but in the moment they want to run it we want to have our share of it.

12. How is your offer structured?
There are two models, one is that they buy a license from us, the other model is that if they do not want to run it on their computers we have a SaaS (Software as a Service) offer as well. So they can put it on our computers, while they only send us a monthly fee. They create the application but it will be hosted by us.

13. Could you give us more details about the on demand vs. licence solutions?
One License for Business Mashup costs 950 euros /month/user and it allows hosting on own machines. For small applications it is more convenient to host also because of the costs that is only a fraction of the license. At the moment we do not have a price for the SaaS offer as we are going to run it from next year.

14. For your clients that already have TeamTrack, how does the upgrade to Mashup Composer work?
It is a very straightforward upgrade like every upgrade. The customers that have TeamTrack get a free license and it is very simple. They do not need to work on anything. The graphics look different but they do not loose anything, they do not need to have any manual interaction

15. At the moment, in the market there are various other mashup solutions available, which are the characteristics of Serena Mashup Composer in comparison with the competition?
First of all we have a great graphical user interface, intuitive, extremely easy to use. I am not a programmer but I am able to use it and guide someone through it. It is a totally web based application, so it is on a server and you need a browser, it is extremely fast, high scalability 20 000 users access.
Moreover it is compatible with all the most spread browsers, the major browsers are supported.

16. Serena is now empowering business user, so that they can create their own applications, how does Mashup Composer take care of control and security issues?
The way the currently applications are deployed is a process oriented way. In the past when you built a workflow it was also implemented. There was no staging functionality, so first you had to stage it and then deploy it. Now we can do business test, unit test, integration test, staging before deployment. Moreover, everybody has to approve before it goes into the life system: you can implement everything and test it, but you can have a step before the final deployment happens which means sign off and approval from all parties. We also have a version controlling and version management function for all the processes and all the things you do with the Mashup Composer.
We give the authority to the business users to write their own applications, but the central IT will still control what will be deployed and what not.

17. The IT market is quite challenging at the moment as globalization, off shoring and new technology are impacting it. What would you say about the impact Mashups are going to have?
I think that when it comes to these things, people still try to offshore big, large application. It is still the traditional model of the development department, it is not the tiny little application that someone needs and than forgets about it. I think off shoring will still happen to a degree and that the trend will continue, but it will be for larger applications not for smaller applications. If you offshore smaller application, the communication needs outgrow the advantages that you have from the outsourcing model. So I think people will be helped write smaller application, giving business users that capability will help them because neither outsourcing their development nor the internal IT department will be able to help them.

18. In a world where more and more large applications are outsourced and business users will have the power of creating their own applications, what will be the role of IT department?
Central control, making sure that security mechanisms are implemented, that quality specs are respected, that you have process implemented in such a way that is coordinated and controlled, you know managed.

19. Do you think organizations and people are ready to share knowledge and services in an open way?
I will answer this question by making an example of a company called Facebook. It is not an old company, nevertheless they are experiencing a powerful evolution. They have only 2 databases: one of them keeps photos and the other profile information. They figured out after a while that they did not have the resources or were not able to build applications based on profile data and photo’s. So they opened up the APIs and they gave it to the world and since they did that they have every month 1000 new applications. What software company has 1000 software applications every month?
Moreover, people using Facebook share a lot of their lives online, especially photos but also different other information like who is their best friend, the members of their social network and their hobbies and preferences.
Facebook can be mashedup with google maps, so you can see where your friends are. There are other applications that provide information based on your location and your preferences like information about your favourite’s band concerts, ticket prices and where they can be bought.

20. Nevertheless, there is quite a difference between sharing of personal data and of company or business data.
I think so too, but I think that people will be ready to share more information and more data openly. If I look at Facebook it is incredible because persons share all their life and I think there is going to be a trend in the world in this direction. I do not know what impact will have on business overtime, and if all the integration of these workflows and services will enable this things or not.

21. Getting back to Serena, would you say you have a strategic interest in CRM?
We are not interested in the CRM market, it is not our goal. We just want to help people develop applications. If with Mashup Composer one can construct applications that bring value to SalesForce.com it is ok, but we are not going to go after the CRM field. Our main focus remains: help people develop applications, help people in the central IT department build these hairy applications that need to follow a certain process and help other people with small and tiny application to develop them easily, but we don’t go after the CRM market, we go straight our way.
We hope that our mashups will actually enable CRM vendors to have things that they don’t have, for example SalesForce.com in their own technology does not have a discount approval mechanism. In every sales company, if you go beyond a certain discount you have to get and approval from a manager, you can do that by writing an email, you can do a phone call or contacting him directly. But you can also start a process. Mashups can ease the way.

22. How do mashups fit with change governance, the central point of Serena’s strategy over one year ago?
Change governance is not as market attractive as mashups. We talk about mashups as our primary strategy at the moment, but this does not mean that we will go away from ALM, PPM and Process management, as I said before we help people develop application, we help central IT through the ALM products, project protofolio management products, process management tools, we help them do their work. We help these other people in the business to write their own small applications through mashups. Change governance is something that needs to happen on top, and I think that with mashups you can be sure to follow a process so you know who did what, deployed when, what application to what server and version these things. Change governance is still important, but it is just a part of what we do, it is completely gone into what we drive right now and we don’t do noise about it anymore.

23. Could we say that Serena is the software company that is helping IT towards business?
Where before we helped only the IT department, now we help business users themselves. I think it is a good description to say that we help people develop application efficiently and effectively and it does not matter if it is the central IT department or business users. We continue to help the IT department but the new trend that we have is to enable business users and not let them wait for the IT. The IT is always seen as the bad boys because the business requests certain things but the IT department usually answers “no or maybe in a year”, and than the business says: “they do not know what they are doing”. Also delaying, everybody is now used to delaying IT projects, it is rather a surprise when it finishes on time. So we help IT guys getting the business off their back, for the small things they can say: do it yourself, I do not concentrate on that because I am after the big and hairy project, where you need professionals and you can not do without them.

24. Our last question is about your marketing strategy for next year, what are your objectives?
We will follow the mashup root, we will familiarize everybody with our new concept, with what we have brought to the market place in addition to what we already did before - ALM and PM, but mashup is the next big wave. Having people write their own applications and that some people will want to deploy them on their own premises while other will make use of on demand services. Our strategy is to rollout MC to everybody in the world because is free, make everybody aware of what we are doing here and how we can help them with that and how they can build their own mashups. We will have a mashup exchange so people can buy already build applications and customized as they want. We will continue to invest in this market and on the market strategy as well.