Google’s Planned IPO

The Economist has its say on Google’s plans for an IPO next spring, which could value the company at USD 15 billion or more:

To be worth the rumoured $15 billion for longer than it takes a bubble to burst, it will need to raise its profitability substantially. That means matching such internet stars as eBay (market capitalisation $37 billion), but without the natural-monopoly advantages that have made eBay so dominantthe classic network effect of buyers and sellers knowing they do best by all trading in one place. For Google to stay permanently ahead of other search-engine technologies is almost impossible, since it takes so littleonly a bright idea by another set of geeksto lose the lead. In contrast to a portal such as Yahoo!, which also offers customers free e-mail and other services, a pure search engine is always but a click away from losing users.

Yahoo!, in fact, will probably be the first to attack. It now owns rival search technologies including AltaVista, AlltheWeb and Inktomi. With the contextual-advertising technology of Overture, Yahoo! now has under its own roof all the elements of the business model that made Google such a success. It cannot be long before Yahoo! turns from a lucrative customer of Google’s into a powerful rival.

Even more frightening (especially to those who remember Netscape’s fate in the browser wars), Microsoft smells blood. It is currently working on its own search algorithm, which it hopes to make public early next year, around the probable time of Google’s share listing. Historically, Microsoft has been good at letting others (Apple, Netscape, Real) pioneer a technology before taking over, exploiting its dominance in desktop operating systems.

Google the new-age advertising agency makes money, but it is Google the search engine that builds the consumer brand which makes the ad agency powerful. Whenever users click on advertisements on Google’s own site, Google gets all the revenues. Whenever users stray to other search engines, even ones where Google has placed sponsored links, Google has to share the revenues with the site owner. As the competition between Google, Overture and others heats up, Google’s profit margins will fall.

Booming Data Storage

Business Week writes about the rapid growth in the demand for storage, nearly dobling every year:

Until recently, storage was predominantly a hardware business — boxes big and small (including so-called flash memory cards) still account for about $14 billion in annual revenue. But software that extends the life of such hardware is where the growth is now. Veritas says in each of the past four quarters its revenues have set records — not bad, considering the three-year tech slump. Market researcher IDC forecasts that the $5.7 billion software segment of the storage biz will grow at a 12% compound annual growth rate through 2007, vs. 4% for the more competitive hardware market.

Every supplier should benefit as storage becomes easier to install and use — but chief among the winners will be the sellers of storage software which, more than hardware, can deliver efficiencies in a flash.

By making software development easier, the new standard should also fuel innovation. The greatest potential for that may be in what’s already the hottest corporate segment: Storage resource management (SRM) software, which is used to control an organization’s entire storage operation. When a storage device becomes 80% full, for instance, this software can automatically delete certain files or move them elsewhere. Because of the potential savings in labor costs, “comprehensive storage management is the holy grail,” says Bill North, a research director at IDC.

Microsoft OneNote

WSJ (Walter Mossberg) writes about the a $99 product designed to help people take and organize notes:

OneNote was developed to help people jot down and collect all kinds of ideas and notes too random to fit easily into a traditional word-processor document or spreadsheet. These are the kinds of notes people might scrawl on a napkin, even if they are computer users. In fact, the code-name for OneNote was “Scribbler.”

Unlike a word processor, OneNote arranges pages into tabbed sections, labeled by topic. Each section can have many subsections and note pages. The pages can have blank backgrounds, or look like ruled notepad paper or grid paper. Whole sections can be color-coded.

OneNote is nonlinear, in the sense that each note you jot down can appear anywhere on the page, in its own little “container,” a box that’s normally invisible but can be made to show up in pale gray. Unlike in a Word document, the notes don’t follow each other line by line down the page. You can make one note appear in the upper left-hand corner, and the next one in the lower right-hand corner. And you can rearrange them.

Overall, I like OneNote. It’s a good idea well executed, especially for a first effort at Microsoft. A 60-day trial version is available for download.

Probably worth a try…

Fast Pace of Change

WSJ writes: “In the shrinking world marketplace, innovations that seduce consumers in one region become global trends with ever-growing speed. The process is shaking up the power structure of one industry after another, from computers to consumer electronics to automobiles.”

The cellphone industry highlights it more than any other:

Major new styles or technological advances in cellphones now appear somewhere in the world almost annually. Wired, well-traveled consumers seek out the latest thing, local retailers rush to offer it and service providers order it to boost revenue. The rapid changes in taste and demand have forced producers into a frantic race to keep up. The pressures have forced some makers to simply pull out.

Manufacturers that can jump on an emerging trend early can command higher prices and reap substantial rewards. Mobile-phone sales at Samsung rose 51% last year as color screens spread from Asia to Europe and the U.S. Companies that miss trends can also miss out on sales big-time. Nokia’s mobile-phone sales last year were nearly flat; Motorola’s rose just 4%.

Innovation

eWeek reports on comments made by SAP executive Claus Heinrich, who “stressed the importance of innovation and embracing new technologies”:

“Innovation is one of the key differentiators for the success of companies,” Heinrich said, adding that successful firms differentiate themselves by how well and how fast they can adapt technology to suit their business processes.

But such innovation really isn’t an option, he stressed.

“It’s no longer a question of can I innovate in order to become best in class, now it’s a question of can I innovate in order to survive,” Heinrich said.

The executive spoke of the real-time nature of business today and how business events can be accounted for right away, not having to wait until a nightly batch process is complete.

“You don’t have to model real-world data anymore,” Heinrich said. “The real world and the IT world are increasingly becoming one and the same.”

“The velocity and complexity of information have increased dramatically,” said Heinrich. “It’s not a threat, it’s an opportunity…to better serve customers.”

In the real-time, event-driven world, the RSS ecosystem can play a very important role.

Social Networking Sites

Social Networking is abuzz with excitement. Friendstrer has reportedly raised USD 13 million from Kleiner Perkins and Benchmark. WSJ takes a look at some are calling as a bubble:

Most of the social-networking sites operate on the same basic idea: connecting people to new people. In the case of Friendster, an individual — say person A — creates a personal profile and invites friends B, C and D to join with their friends; B accepts and brings in his buddies, as does C, who brings in her friends, and so on, enabling person A to meet friends of friends of friends. Friendster connects to “four degrees of separation,” Mr. Abrams, who founded Friendster, says.

“They’re obviously growing by leaps and bounds and spending no money on marketing,” says Mr. Doerr. “That they’re using very powerful human relationships to connect is really at the core of what makes this for me quite compelling.”

Ethan Watters, author of “Urban Tribes,” a recent book that examines friendships among young, unmarried urbanites, says Friendster has caught on with this group because the complicated tasks that confront them — finding a job, a friend, an apartment, a date or a used-car deal — are facilitated by connections.

Friendster’s users have eclectic aims, but some networking sites specialize. LinkedIn and Ryze.com, for example, focus on matters of employment. Tribe.net functions like online classifieds. (How better to buy a used car than from someone you know?) Meetup.com helped Democratic presidential hopeful Howard Dean with successful grass-roots fund raising. Emode gained steam as a place where users could take personality tests and then connect with like-minded friends.

Sites like Friendster have to be careful about how they grow, says Charlene Li, an analyst with Forrester Research Inc. in San Francisco. “The social networks are great as long as they are small,” she says. But “in order to have a business model, that requires scale, typically,” she adds. “Those two things are inherently in contradiction. It’s a fundamental challenge.”

TECH TALK: SMEs and Technology: 1:1 Computing

So far, few applications have tended to put the user at the centre. The focus has always been on technology. For example, the knowledge management applications have always focused on top-down approaches. We are saying it should be different put the individual at the centre, and then build things around. When done top-down, there is no incentive for the individual to contribute. In fact, it could even involve a disruption of the persons normal activities. This creates resistance. So, we need to think of it not as a knowledge management problem, but as a user productivity challenge. The question to be answered is: how can we provide the appropriate technology tools for users to do their work better? Along with the tools, the individuals also need training in how to use them a methodology, which may result in change of some habits.

Productivity enhancements works at two basic levels: individual and groups. The enterprise productivity is derived from the other two. The focus needs to be on enabling information flows and capturing the tacit knowledge within. This is what gives the organisation its memory and productivity. Analytics and Business Intelligence software will work at the organisational level.

The focus has to be on (a) ubiquity of technology, and (b) making people more productive via the applications. Small- and medium-sized enterprises (SMEs) have to genuinely believe that their investment in technology will go a long way in boosting their productivity. The progression is: individual productivity, group collaboration and organisational processes.

In this series, we have discussed various reference architectures: clients, servers, systems software, information management and business applications. The one unifying thread that flows across them is what I describe as 1:1 Computing. This needs to be seen at two levels: one business, one server; and one employee, one computer. The server has all the applications necessary for the enterprise, while the presence of a computer on every desktop creates the foundation for digital processes.

The business goal of 1:1 Computing should be to create a modernised business with a connected computer for every employee to improve productivity by 10% and business profits by 10%. It does so with two key sets of components: the Server, which provides the back-end infrastructure, and the client desktops, which provide the front-end interface. The benefits: reliable messaging and secured enterprise, an increase in individual productivity, improved information flow within groups which builds an organizational memory, and efficient business processes across the organisation.

Technology should thus provide the small- and medium-sized enterprises (SMEs) with complete integrated business systems needed to modernise, automate and simplify your business. A 1:1 Enterprise is identified by:

  • A scalable backend infrastructure which provides instant, personalised and cost-effective communications, secures the enterprise, and provides simplified administration of the technology resources.
  • A computer for every employee provides the foundation for personal productivity enhancements and creating the base for electronic capture and flow of information.
  • A suite of applications that powers an information refinery and ensures an intelligent, event-driven, real-time enterprise.

    A 1:1 Enterprise is what SMEs should aspire to be. The power of 1:1 does not stop with just the technology infrastructure. It extends to the way SMEs view their relationships with their customers and vendors. The 1:1 Computing infrastructure provides the foundation for the 1:1 Enterprise.

    Next Week: SMEs and Technology (continued)

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  • Thinking

    Given the nature of our work, we all need to spend time thinking. In fact, we need to think more and do less, not the other way around! I have generally found the following things useful in doing thinking:

    Solitude in Early Mornings: There is something about the morning – the silence, the darkness which slowly gives way to light (very symbolic) – that makes the ideas come.

    Reading a Book: I have found that when there is a problem which I am thinking about, reading a book – any book – helps provide potential ways to look at the problem differently.

    Writing: Many times, I will just sit in front of a computer and start typing. The ideas start flowing. This post is an example. I started with the seed of an idea for the post, and this is evolving as I write.

    Talking to Others: When I have an interesting idea, I will get someone to talk to – more like, listening to myself. As I talk and respond to queries the other person may have, the idea fine-tunes itself.

    Doodling: Sometimes, I will just take a blank sheet of paper, and start drawing a mindmap which outlines that I know about the problem. This helps in laying out the possibilities.

    Longhorn and Office 2003

    Bill Gates writes about Microsoft’s new OS, which will be relased sometime in 2005-06:

    we are moving to this Web services world–a loosely coupled, message-based breakthrough that computer scientists have dreamed of for decades–all of the things that let that be possible need to be in the $50 operating system. And so here we have Indigo, which will be in Windows and let you do transactions and queuing.

    The person getting the benefit of those won’t know that that is going on. But you also get to use the great Avalon graphics and the ability to navigate information with WinFS. Application developers don’t have to duplicate those things, and yet there’s no cost to having those things be in the platform and one way of doing debugging and performance.

    That’s the miracle of software, in terms of how we can get better and better things. So here we have something that was done through middleware coming into the system. We’ve seen that with media playback capabilities, with the browser, and that will continue…There is sort of that crowd that thinks that when the valuations broke that somehow technology advances wouldn’t come. There’s a general attitude now to not see that we will be delivering more software advances and productivity in this decade than we did in the last.

    By knowing what Longhorn will look like, it will influence quite a bit of what people are doing today. For instance, the trend toward XML (Extensible Markup Language) Web services, as people use Indigo, built into the platform. That will reinforce the move toward Web services as people see all of the schematizing, the common information types for contacts, appointments, documents, annotation.

    In another story, Fortune reviews Microsoft Office 2003, and suggests: “Office 2003 is an admirable upgrade to an already successful and popular program. Microsoft is going to spend half a billion dollars in coming months to persuade you to buy it, or upgrade to one of the 2003 versions. For most consumers, itll be a tough sell.” I am looking to buy a copy soon and check it out.

    Identity Management

    [via Sumit Dhar] News.com writes:

    Identity management is the latest security technology to gain popularity in the corporate world–mostly for its efficiencies. The technology allows new employees to be set up with network resources in minutes, rather than days, while requiring them to have only one password for access to servers, printers and other proprietary equipment. Because of significant savings in time and money, manufacturers say, identity management systems can pay for themselves in a year.

    “Identity management has one simple goal: one identity per individual, at least in the corporate setting,” said Chris Christiansen, a security analyst at market researcher IDC.

    In essence, identity management brings together various software packages that were separate systems just a few years ago. Companies no longer need piecemeal identity technologies such as single sign-on applications, directory management software and auditing or accounting packages. Not surprisingly, many manufacturers of these technologies are now rebranding themselves as identity management businesses.

    By connecting human resources systems directly to the servers that control access to corporate network resources, companies can significantly reduce the time it takes to get new employees set up to access all necessary systems.

    What we are now seeing is a focus on creating technology to make individuals and groups more productive.

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    Self-Healing Software

    Technology Review writes:

    A growing number of researchers have been talking about a shift in the core metaphor for computing, from the notion of artificial intelligence to something that might be called artificial biology. Forget about the dream of creating bug-free software. Just as bugs regularly affect any biological systemI have a cold as I write thisthey should also be expected in software. So software needs to be designed to survive the bugs. It should have the biological properties of redundancy and regeneration: parts should be able to die off without affecting the whole.

    The point of autonomic computingand by extension, of self-healing softwareis to give networks and computer systems the ability to regulate and repair things that now require human thought and intervention.

    In the future, the biological metaphor may even affect the way we program to begin with. Software could eventually heal some of its own bugs, supplementing catch-all fixeslike automatic rebootingthat dont get at the core problem. But that will require an entirely new approach to programming.

    We need to move towards a programming philosophy where we look at the global system and understand what properties it needs to have, rather than thinking about programming as a sequence of instructions, says David Evans, who is pursuing biologically inspired programming methods as a computer science professor at the University of Virginia. Its really a different way of approaching problems.

    Evans notes that software today is written linearly, with each step depending on the previous one, more or less guaranteeing that bugs will wreak havoc: in biological terms, organisms with no redundancy dont survive long if one means of accomplishing a task fails. More robust software would include many independent components so that it will continue to work even if several of its components fail.

    Advertising on Search Engines

    Advertising on search engines is becoming more targeted. News.com has more, following the purchase of Sprinks by Google:

    [Google] operates a commercial search service called AdWords, which auctions sponsored link placements on search results pages and competes with Overture Services, a subsidiary of Yahoo. Marketers pay each time Web surfers click on their ads…So-called content targeting, which Sprinks pioneered, expands on search engine advertising by delivering ads to Web pages based on subject matter and other contextual hints.

    “Keyword-based contextual advertising will begin to lose its luster within 12 months, as high-spending advertisers find targeting attractive but creative opportunities limited,” said Gary Stein, a Jupiter analyst. Instead, Stein said, search-oriented companies such as Google and Yahoo must evolve by introducing geotargeting, or location-based advertising, as well as by offering “the ability to buy increasingly rich media ad units and purchase beyond simple relevance.”

    Google and Overture have already started testing systems that let advertisers confine their pitches to people from specific locales. Google introduced its service, called Regional Targeting, to its AdWords advertisers last week.

    Above all, analysts said, Google is looking to improve the relevancy of its advertising results.

    “The greatest challenge that Google faces in the face of growth is customer satisfaction and relevancy,” Jupiter’s Berk said. “The whole economic model is based on relevancy. It’s one thing to build a major distribution network; it’s quite another thing to scale that, having over 100,000 customers. That’s a big risk, and they have to be careful managing it.”

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    TECH TALK: SMEs and Technology: Visual Biz-ic

    Visual Biz-ic (a term I have coined) is at the heart of the business applications architecture. Think of it as doing for business processes what Visual Basic has done for software development. It provides a framework to specify business processes, and interconnect them. It would consist of a forms designer, a workflow manager, a process designer and a library of existing business processes. All of these would be linked via web services, with information exchange taking place through XML. Software developers and process owners in enterprises can use the infrastructure provided by Visual Biz-ic to specify the processes that need to be managed. Visual Biz-ic thus becomes a platform for business process management.

    Why is Visual Biz-ic so important? Because processes are important. This is where the small- and medium-sized enterprises (SMEs) will get their next big increase in productivity. So far, computers have been used for individual task automation email, surfing, documentation, accounting. There is a limit to its impact on productivity. This is because a task is part of a process. Processes need to designed and managed. A process can be thought of as a series of inter-connected and inter-dependent tasks where the output of one is the input of many others. In silo tasks, the output is typically an email, a print-out or a phone call. There is a terminal point. In processes, this does not happen there is a continuum of information flow across people, there is a pipeline that is created. Process management is what are missing in most enterprises today. Only when we shift focus from tasks to processes will organisations reap the true benefits of productivity via technology.

    Wrote the Financial Times recently in an article on IBMs next transition (to incorporate on-demand computing and business process outsourcing): Looking at companies as collections of business processes (order entry, fulfilment or billing) rather than functional departments (marketing, manufacturing or customer care) makes sense. Breaking down boundaries between departments to ensure smooth operations is also a legitimate goal. The objective now is to use industry standard technologies – such as the internet and XML, a kind of lingua franca that enables computers to understand each other regardless of the software they run – to bring more flexibility and transparency to companies’ operations.

    The specialised functionalities embedded in todays ERP, CRM, SCM applications would need to be re-created as process-driven objects as part of Visual Biz-ic. There would be a set of generic software providers who would provide these components across industries. Some of the enterprises could use these as-is, while others would either customise these to suit their business processes or use other industry-specific components from specialty vendors. Either way, the world of business software becomes akin to integrating Lego-like blocks together, with web services acting as the glue.

    In fact, it is possible that SMEs will also need help in the form of consulting to help design their business processes. While the smaller enterprises will chose to go in for the off-the-shelf processes as part of the Visual Biz-ic libraries (sourced from other similar companies), the mid-sized companies may expect to redesign their internal processes and even look at outsourcing non-core processes. Either way, SMEs need the standardisation that Visual Biz-ic brings, very similar to what software developers have been used to with Microsofts Visual Basic.

    Tomorrow: 1:1 Computing

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    Dell’s Management Secrets

    Dell never ceases to amaze. Think of it was the Wal-mart of IT. It is now targeting revenues of USD 60 billion by 2006 (from the current USD 40 billion), maintaining a 15% growth rate. Business Week has more on the Dell Way:

    Michael Dell expects everyone to watch each dime — and turn it into at least a quarter. Unlike most tech bosses, Dell believes every product should be profitable from Day One. To ensure that, he expects his managers to be walking databases, able to cough up information on everything from top-line growth to the average number of times a part has to be replaced in the first 30 days after a computer is sold.

    But there’s one number he cares about most: operating margin. To Dell, it’s not enough to rack up profits or grow fast. Execs must do both to maximize long-term profitability. That means products need to be priced low enough to induce shoppers to buy, but not so low that they cut unnecessarily into profits. When Dell’s top managers in Europe lost out on profits in 1999 because they hadn’t cut costs far enough, they were replaced. “There are some organizations where people think they’re a hero if they invent a new thing,” says Rollins. “Being a hero at Dell means saving money.”

    It’s this combination — reaching for the heights of perfection while burrowing down into every last data point — that no rival has been able to imitate.

    Internet 2, IBM and Microsoft

    NYTimes writes about the differing views and strategies of the computer industry’s two most powerful firms:

    The Internet Act I was mainly about e-mail programs and downloading digital information to look at or listen to – Web pages, animations, video and music. Act II should bring all kinds of automated transactions among businesses and individuals. And those transactions will be able to include a hint of computer-aided intelligence.

    An example could be arranging an appointment with your dentist. Your calendar information, with stated time preferences and availability, exchanges data with your dentist’s calendar to automatically set up an appointment. Similarly, companies should someday be able to conduct computer-automated auctions with suppliers. The next-generation Internet can be thought of as the beginning of what researchers have said might be possible with software agents, or bots, performing as human assistants.

    The Microsoft vision centers on the individual and technology tools, foreseeing a kind of rerun of the personal computer revolution in the Internet era. I.B.M. sees the computing evolution as helping to free companies from the previous constraints of technology, so they can focus more on using technology to streamline business processes and seek new markets than on the hardware and software itself. One implication, I.B.M. says, is that companies need not have so much internal technology. Instead, they can buy computing and technology services from outside suppliers like I.B.M., almost as if a utility, paying only for what they use, on demand.

    In another article, AMR Research looks at the what is sees as a golden future for IT: “Technology users are increasingly business usersWith commoditization and stability in technology markets, a whole new generation of technology users will emerge: business users. For the first time, technology has gotten easy enough to use that it can be deployed widely within organizations and across industries. What has been a long time coming can finally happen because of the convergence of the ease of global communication provided by the Internet, availability of easy-to-use handheld devices, emergence of wireless access, and full deployment of advanced applications that make business data accessible. This is causing a structural change within the user community that will make technology a part of the fabric of every line of business. It will also lead to the widespread use of this technology infrastructure within small to midsize businesses, which in the past could not afford either the technology or the complexity of using it effectively.”

    Rethinking Linux

    My colleague, Prakash Advani, envisions what a re-written Linux could be like: “Our next-generation operating system (NGOS) would be completely modular in design, aimed at 64-bit hardware, and with an interface that would change the way people compute. It would support a large number of applications and hardware devices, accepting device drivers written for other operating system, and run applications written for other operating system under an emulation mode.”

    Search Wars

    WSJ has an article on the various companies angling for a piece of the search pie:

    Already, Google is holding exercises on Amazon’s borders with its Froogle retailing engine. Amazon, too, has made moves beyond its core retailing business: The company increasingly acts as a guide to third-party stores in categories such as sporting goods and toys, and is developing an e-commerce search service. Meanwhile, eBay relies on search to help users find just about anything anyone would like to buy — and its popularity and PayPal payments unit put it in a strong position should it get an expansionist itch. Then there’s InterActiveCorp, which is a top provider of searches for airline tickets, hotel reservations and the like, but may want to establish a stronger position in everyday searches.

    Yahoo, Google, Microsoft, eBay, Amazon, InterActiveCorp: They arrived from different starting points, and have different strengths, but all may be combatants in the new round of search wars.

    Mozilla Branding Ideas

    Steven Garrity has ideas for rebranding Mozilla, which could apply to software products in general: “Any good visual identity builds on what is already established, while improving on the weaknesses of past. So too should the visual identity of the Mozilla project and products. A unified, consistent, but flexible brand and visual identity would be a great complement to the technology developed under the Mozilla project.”

    Where are the Women Bloggers?

    BlogStreet’s list of the top 100 bloggers has come under scrutiny in recent times from the likes of Halley Suitt, Dana Blankenhorn and David Weinberger.

    Dana’s point: why are most of the blogs on politics? Halley’s response: why aren’t there more women bloggers in the list? (Halley counted all of 3 in the top 100. Kevin Marks points out there are a lot more, in his commonet on David Weinberger’s post.) Halley also wants to know more about the algorithm used – “based on who blogrolls whom.”

    Here is more info on how we do the rankings, written by Veer, who managed BlogStreet.

    Computing the Blog Influence Quotient (BIQ) is a two step process. First the BlogRank is calculated, based on the number of blogs blogrolling a blog. More the number of blogs blogrolling a blog, higher will be its BlogRank.

    For BIQ it is not just how many people blogroll you i.e. the quantity, but what matters is *who* blogrolls you i.e. the quality. It takes into account the BlogRank of the bloggers who blogroll you.

    Thus your BIQ increases if a blog with a high BlogRank is blogrolling you. Think of BlogRank as weighted rankings, blogosphere’s equivalent of Google’s PageRank.

    Perhaps this should put the rankings in context.

    TECH TALK: SMEs and Technology: Business Applications Architecture

    The business applications layer consists of various components to describe and manage the processes within the small- and medium-sized enterprises (SMEs). Sandwiched between the Database and the user interface (via the Digital Dashboard or the Microcontent Client) are the Application Server, Visual Biz-ic and the specialised objects that represent the business functions.

    The Application Server has become part of the e-Business infrastructure. In the open-source world, there is JBoss. Among the proprietary solutions, there is IBMs Websphere, BEAs Weblogic, Oracles Application Server and Indian company Pramatis product.

    The database and the application server provide the foundation for business process management (BPM). William Gurley provides the wider perspective:

    BPM is a new programming paradigm for the enterprise that leverages browser-based applications, e-mail, global connectivity and enterprise application integration (EAI) infrastructure to deliver a powerful, business-focused programming solution. A mix between workflow, EAI and application development, BPM makes it easy for companies to codify their current processes, automate their execution, monitor their current performance and make on-the-fly changes to improve the current processes.

    Here is how it works. Business analysts work alongside IT staff and create a graphical flow chart of targeted processes within the organization. These graphical designs are typically done in an integrated design environment (IDE) and represent the different events, decisions and actions that are performed by employees as well as the flows of data that are necessary to perform each task. Once defined, people begin to interact with the new application. New “processes” are started by an individual (for example, entering a new customer issue) or as the result of an event (for example, a customer account goes past due). Actions are then passed from person to person through the concept of a task inbox, and typically the passing of a URL.

    For the first time, a single person can easily “hand off” an application to another person. For instance, during an approval process, one person may initiate a purchase order. If that order is over a predefined limit, the order may then be passed to the task box of the person’s supervisor to await approval. The supervisor will click on a URL in the inbox, immediately see all the relevant data, and then perhaps decide to approve the order. The order may then be passed to the purchasing department and even potentially forwarded out to the supplier.

    The essence of BPM software is that it solves business problems for business users. Whether Web services or Corba or .Net is part of the underlying technology is about as interesting to these decision makers as the brand of disk brake is to most people who purchase automobilesBPM purchasers want applications that are easily understood, quickly deployed and have immediate impact. Simplicity is the key here–technology for technology’s sake just won’t fly.

    Gurley describes six components that a BPM solution would need to provide: IDE (integrated development environment), process engine, user directory, workflow, reporting/process monitoring, and integration. This is what Visual Biz-ic needs to do.

    Tomorrow: Visual Biz-ic

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