I recently attended a conference on cloud computing, held by The Virtual Computing Environment Coalition (VCE), a coalition of three of the leading vendors in the industry: EMC2, Cisco and Vmware. Virtualization and cloud computing are two of the newer technological trends and gaining momentum every day. Gartner EXP Worldwide Survey of Nearly 1,600 CIOs indicates that in 2010 the first technological priority of the CIOs is virtualization and second is cloud computing. This is a major change in the IT industry; in the same survey in Jan 2009 neither of these were in the top ten technologies.
New technologies always represent a challenge to the Product Mangers. Should we invest and adapt the technology or is it only a “buzz” that will disappear? In some cases it introduces a disruptive force to the industry which actually changes the rules of the game, creates an opportunity for new players and might be a threat to the existing players in the market. So, the stakes are high, misjudgment of the affect of the new technology might cause a large impact on our business. We will discuss the importance of and ways to track technological trends in a future post.
In the case of cloud computing the potential affect might be more than only on the product. It might change the way we do business. Should the business be “product centric” or should it change to a xAAS model?
As we discussed in the post “the Craft of PM&M”, one of the main challenges is to make a decision in a world of uncertainty. The impact of Cloud Computing will be different between industries and between domains within a specific industry. There is no one answer that fits all. Each PM in his/her own domain should consider the wide view of the industry and take into account the users and usage habits, the competitors, possible new competition due to the change, the customers (if the users and customers are different), and the maturity of the technology related to the specific industry. Our task is to correctly position the product.
The decision to be made is not between ignoring the change and fully embracing it. There are several alternatives to implement or approach a change. We need to determine the correct product requirements in the light of the possible changes.
We can choose not to do anything and wait. The simplest approach, before making substantial investments, is to change the “marketing language” that is used to describe the offering and start using the newer, trendier, terms when describing the product and the offering. The next step is to create a demo which is more convincing than the marketing pitch. Moving up in the investment and the complexity, we can build a “Proof-of-Concept” which is not only a demo but still not a product that can be delivered to customers. Finally, if there is a decision to adapt the technology, only then we should implement it in the product.
Whether we choose to ignore the change for now, or choose any of the other alternatives we must decide on parameters or events that we should track. These parameters and events should signal us if a decision should be changed. They should indicate changes in the market that point to either the direction of adaptation of the technology by the market or that the market abandon this trend. Any change that indicates a deeper commitment and implementation in the market should cause us to reconsider our strategy and move to the next level of investments in our offering.
Cloud Computing is an interesting topic in its own right and it serves as a good case study for the wider discussion of technological change and product positioning. Constantly, there are technological trends to follow, but not all trends are relevant to all domains and products. However, it is crucial for a Product Manager to keep track and to be informed so that those trends that are relevant will not be overlooked. Missing on a relevant market trend might not have an immediate impact but can prove to be critical in the mid and long terms. It is also important to make the correct call on the required response.
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