Published on the 26/04/2017 | Written by Donovan Jackson
In time, businesses will buy outcomes, not software…
What comes after software as a service? Why, business outcome as a service, of course. That’s the contention of Stephan Sieber, CEO of one of the lesser-known providers of enterprise software, Unit4.
The Dutch vendor, which specialises in providing software for the education, public sector, not-for-profit and professional services industries, has a fair presence in ANZ, with NZ Post a major user of its software in New Zealand and several implementations in Australia. Signifying its confidence in markets down under, Unit4 also has a direct presence in Sydney.
Speaking with iStart, Sieber said the history of enterprise software started with slinging code. “In the old days, we were selling code to customers and then told them there were two adjacent models; the code was not easy to use and it was buggy, so those models were consulting to make the code fit, and upgrades and maintenance.”
These days, with software as a service and the cloud, Sieber said the real benefit for customers is that it is just a better way to deal with technology vendors as there is no longer the need to pay up front for running a solution.
However, this is an interim step. “What are customers really interested in? They don’t want software or a relationship with a vendor, they are interested in the business result. The cloud industry still is not delivering that, they are delivering ‘up and running solutions’, which might impress the IT department, but the business measure of success is not the same.”
Sieber said he is certain that soon, this will change. “I’m convinced that in the next few years, we will see business models which are data and insight driven, and customers will buy and pay for results instead of code.”
Not an ERP vendor
Unit4 is a slightly different vendor from the usual ERP providers in more than one regard (it’s Dutchness, being that one regard). Sieber said business software falls into two broad categories: software that businesses need, and software that businesses want; Unit4 wants to be the latter. “ERP tends to be software that businesses need. It pays the bills, it keeps the lights on, it produces the general ledger. You cannot get rid of it, but it is vanilla, it doesn’t do anything special. It is like an income tax, you pay a lot, but you don’t like it and there is no way to differentiate your business by using this software.”
Software that the business wants, on the other hand, adds a ‘je ne sais quoi’ (that something extra will depend on the specifics of particular organisastions).
And that’s where Unit4 seeks to focus. “This is our raison d’etre. With ‘self-driving’ applications, we want to create ERP that customers hate less. We want to deliver painless ERP to reduce as much as we can the time and energy spent managing non-differentiating processes that every business has to go through, but which do not create a competitive advantage.”
Self-driving applications offer built in assistance and intelligence, so when people need to do the various tasks to which they turn to software for facilitation, the software itself talks them through it (with chatbots, that is increasingly a literal ‘talk through’) or does parts of that task automatically.
“So, we’re automating the repetitive tasks and only requiring human intervention for exceptions, rather than for everything.”
The software that businesses want, continued Sieber, tends to be the front office stuff. “We want people to spend their time here, and it is in this area that self-driving applications are crucial; we have a lot of data in business applications, but we don’t tend to do a lot with it. We feel we can do much more, using algorithms and machine learning to, for example, identify and recognise previous projects which might be similar to current ones and provide insights and guidance on what worked well in the past and where things might have gone wrong.”
In the busy ERP midmarket, said Sieber, Unit4 is seeking to differentiate itself not by telling the world at large that it is an ERP vendor. Instead, it is seeking to become known as the provider of software that businesses want in the specific verticals it targets. “If we manage to deliver the proof points that show, for example, that we are better in helping professional services organisations to manage efficiency, or not-for-profits to raise funds and manage contingent workforces, then we are generating better results and this will get rewarded.”
In other words, Unit4 doesn’t really care a fig whether ‘the industry’ knows about it or not. Instead, it cares about being recognised by customers as providing better ways to manage their business challenges.