The Consumerization of Enterprise Software

Rethinking the Enterprise User Experience

In the 80's and 90's, companies like Oracle, PeopleSoft and SAP pioneered the enterprise software movement as we know it today by building on-premise software suites packed with features that aimed to solve most of the major problems encountered by employees in big and medium sized companies around the world.

IT managers in charge of picking vendors for enterprise companies were primarily interested in raw product functionality and feature composition of enterprise products peddled by vendors and typically gave little thought to the ultimate end user experience of corporate employees. The best products were effectively the products with the most features.

There were no strong requirements around optimizing the user experience for the employees who spent 8 hours everyday buried in these tools. There were no strong requirements around building collaborative environments within enterprise applications. There were no requirements around supporting use on multiple devices, because n-screen consumption via portable smart devices was not a thing at the time. The idea was that enterprise applications would just get the job done. User guides were considered an optimal fix for bad user experience. Employees had not necessarily encountered better software, so in comparison to working purely offline on paper, these clunky software suites were still considered a better alternative.

Fast forward to 2014. Consumer software has worked its way into the lives of billions of people worldwide. The very same employees who use well designed consumer services like Evernote, Dropbox and Twitter at home have to go to their offices everyday to endure hours of torture by software that looks like this:

SAP gui

Employees have realized that software doesn't have to suck. They have realized that software doesn't have to be unnecessarily clunky and slow. They have realized that real-time social components that help streamline P2P communication can be built into any application. They have realized that software doesn't have to be confined to a desktop computer, and that in fact software can move around with them on any device they own. They are aware of all this because the consumer applications that they spend most of their free time on are clean, intuitive, collaborative and portable.

It is really counter-intuitive that the average consumers feels more productive and empowered in personal consumer software like Evernote than they do in the enterprise software suites that they encounter at work. Good enterprise software is meant to enable employees to reach maximum productivity levels.

Within the last decade, we have seen a great number of new age SaaS enterprise vendors like Trello, Box and Slack invest really heavily into building user experiences that are up to par or even better than those of their consumer counterparts. We are seeing many new SaaS vendors focusing on the following key pieces:

1. Mobile UX: The average enterprise employee owns at least one mobile device which they have a stronger attachment to than they do to their PCs. Mobile sales are dwarfing sales of all other devices, and with over 3 billion connected mobile devices today, the declining sales of traditional PCs and current projections estimating 6 billion+ expected connected mobile devices by 2020, modern enterprise software needs to move with employees on the mobile devices that they spend the majority of their time on.
2. Collaboration: For the most part, employees don’t work in silos. Collaboration is at the core of the most important employee workflows, and as such collaboration needs to be at the heart of any modern enterprise software product. The quintessential example is with Microsoft Office vs. Google Docs product lines, where collaboration in Microsoft Word or Excel means emailing files back and forth multiple times, whereas collaboration is built into the core of Google Docs and multiple users can edit the same file in real-time without any email interaction. Collaboration in modern enterprise tools needs to be seamless and as close to real-time as possible.
3. Optimizing User Workflows: New age enterprise companies are dedicating tons of resources to figuring out the most optimal way to reduce the time it takes for employees to execute core tasks using their tools. It is no longer all about the number of tasks a user can perform with a specific tool, there is now a lot of thought being put into how quickly and efficiently an employee can perform tasks using said tool. Quality trumps quantity.

The legacy vendors across all enterprise spaces are also beginning to make huge investments into adapting the user experiences in their product lines to align with the needs of modern enterprise employees, but anyone who has ever worked in a big company knows that disruptive change of this magnitude is usually slow to materialize in any meaningful way in such organizations due to an unfortunate combination of layered bureaucratic decision making processes and legacy systems that need to be supported during such migrations.

As such, most of the innovation we are going to see in the enterprise space over the next decade is probably going to come from young best of breed SaaS vendors that prioritize end user experience above all else right from product inception. We are already seeing and will continue to see a decline of the market share of the core on-premise businesses of legacy vendors across all spaces that they currently control. The legacy vendors are not going to disappear overnight and will definitely not go out without a strong fight, they will continue to make huge strategic purchases of their younger and better designed competitors whenever possible.

It is also important to note that while it is easy for a startup with eight employees to jump from one vendor to another in a matter of days, there are humongous migration costs — time and money — involved for IT departments in big organizations like banks, rental car companies and airlines with thousands of employees and yottabytes of data to migrate, so these shifts in enterprise IT stacks in bigger companies, while inevitable, will be a gradual process.