P&G CIO: There's A Better Way To Create Software - InformationWeek

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2/13/2013
01:31 PM
Chris Murphy
Chris Murphy
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P&G CIO: There's A Better Way To Create Software

Procter & Gamble CIO Filippo Passerini thinks cooperation among the likes of Disney, FedEx and Goldman Sachs could push software vendors to build more relevant analytics software --and build it faster.

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Procter & Gamble CIO Filippo Passerini is charming, polite, gracious -- and incurably impatient with the status quo. The current target of Passerini's dissatisfaction is the way in which software gets developed to meet the needs of businesses such as P&G.

Passerini describes business software development today as a "hub and spoke." The software vendor pitches what it's selling and what's possible with technology, then a would-be customer tells the vendor what they really need. FedEx, Boeing, BP, Disney, Goldman Sachs, GE -- they all go through the same exercise as P&G, one-on-one with the vendor.

Today, companies such as P&G have a screaming need for better analytics software to help them make sense of their growing mountains of data about sales, supply chains and customers. The conventional hub-and-spoke development model is still driving software innovation, but Passerini isn't confident it will produce the analytical software to meet future needs.

[ Big data has value that's often not reflected in the books. Read What's Your Big Data Worth? ]

"With the inflection point we are at, in a couple of years it will run out of steam," Passerini said at a P&G event at its Cincinnati headquarters that included those other big technology buyers as well as technology vendors. "The opportunity is now to do something dramatically different."

Passerini stopped short of proposing what replaces today's hub and spoke. "We don't have a solution," he said. "We don't have an answer. That's why we're here."

P&G has held a similar meeting each year showcasing the company's own technology, but this is the first year P&G brought in other big technology buyers and centered the meeting, called Goldmine, on one topic: analytics. P&G CEO Bob McDonald addressed attendees and set the need for better analytics: "We have to move business intelligence from the periphery of operations to the center of how business gets done."

Silicon Valley had better listen closely to what the likes of Passerini, FedEx CIO Rob Carter and Boeing CIO Kim Hammonds have to say about whether they need a different model for developing business software. Companies like them spend billions of dollars on IT every year. Venture capitalists and entrepreneurs are trend seekers, and the IPOs of enterprise IT companies such as Workday and Splunk have put more focus on business software.

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So, what might a new approach to software development look like? That's where you come in.

Collaborative Software Innovation?

Passerini, by design, didn't lay out a plan for how software development should change. He's trying to spark a discussion. He met privately with IT leaders at the meeting and said he thinks there's interest in exploring the idea.

So that leaves it up to us to envision a faster and more relevant way to develop software. Please share your ideas in the Comments section below.

Meanwhile, here are some of my thoughts on the challenges of a more collaborative software development process, to get things started:

Openness: A collaborative customer effort to spur new software ideas will still face the same question a company faces on its own: Which vendors should we work with most closely? Would a new model involve, say, six non-competing companies picking one analytics vendor to collaborate with? Or would this group come up with a set of needs and broadly publish them, to let big and small companies go after them?

One option is an open innovation platform -- this small group of CIOs publicly lays out their needs for big vendors and entrepreneurs alike to tackle. InnoCentive offers a marketplace for such ideas, and P&G is among the companies that have used it. But those innovation challenges tend toward R&D efforts.

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ChrisMurphy
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ChrisMurphy,
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2/25/2013 | 4:01:40 PM
re: P&G CIO: There's A Better Way To Create Software
I received this comment via email, posting below with permission:

According to Eric von Hippel's "Democratizing Innovation" (MIT Press, 2006, open source), user-centered innovation provides the most rapid type of innovation: product breakthroughs as opposed to product evolution from the vendor. This argues for a new software product architecture. We (I'm a software designer) typically build closed systems, software with focused feature sets and limited configurability. To foster innovation, we should really build toolkits, not single-purpose end products. Software buyers would then enhance and tune the toolkit for their particular needs.

The IT people who are being consolidated out of a job would have something new to do.

Bayard Kohlhepp
Nexus Technologies Inc.
ChrisMurphy
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ChrisMurphy,
User Rank: Author
2/18/2013 | 7:15:22 PM
re: P&G CIO: There's A Better Way To Create Software
It's definitely a big point of tension. But look at what Lee Patty is saying above -- develop for one market and then pivot. An investor might want to fund for an initial market, but an investor also wants growth, and that quickly turns to the potential in adjacent markets. And if a startup embraces lean startup ideas, maybe it doesn't even need that much funding for the initial vertical market -- they don't even bring in traditional investors until an expansion into adjacent industry markets.
ChrisMurphy
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ChrisMurphy,
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2/18/2013 | 7:10:01 PM
re: P&G CIO: There's A Better Way To Create Software
Lee, very practical insights from someone who's out there innovating on new software for digital business. Lean principles and lean startup tactics need to be part of the answer to move faster, glad you brought that into the discussion.
Laurianne
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Laurianne,
User Rank: Author
2/14/2013 | 6:37:38 PM
re: P&G CIO: There's A Better Way To Create Software
What about the Salesforce.com Force.com model? What lessons can be applied here? That example certainly speaks to the "speed" challenge.

Laurianne McLaughlin
InformationWeek.com
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