Daily ‘Fistfights’ Occurring On the Battleground Of Software Marketing
Stopped in thick traffic on Torrey Pines Road, a commuter taps into the Net on his wireless computer-phone and starts a ticklish financial transaction.
The wireless connection fails. Steven A. Mills can only imagine what comes next.
“Well, what happened?” he says, tracing the thoughts of the harried user. “Did it go through? Did it not go through? Can I go back in? Can I figure out where I left off? Or does it appear as if I’m just starting again from scratch?”
“There is nothing more disconcerting than to think you tried to move money around and you lost your connection,” said Mills, who as one of the top brass at IBM Corp. gets paid to think about such things.
The executive from Somers, N.Y., is seated in a sunny hotel dining room, getting ready to speak to several thousand IBM software salespeople assembled for an annual conference, which was held this year at the San Diego Convention Center.
He speaks of a “no rules” environment in software marketing, of an “enormous latitude for mischief” in software sales, even of getting in a daily “fistfight” with a competing CEO.
Like a good salesman, Mills, the senior vice president and group executive for IBM’s software group, raises doubts about the quality of his competitors’ offerings. Software is an easy field to get into and requires little capital investment, he says. And Mills raises doubts about the integrity of his competitors’ sales approaches.
“I think, frankly, many of the software companies have sort of a manipulative view of how they’re going to interact with their customers: ‘These are things you want, or these are things I gave you. You didn’t tell me you wanted them to work this particular way.'”
There is “a little bit of the P.T. Barnum attitude in this industry: ‘A sucker born every minute’ kind of thing,” he says.
Mills estimates the worldwide annual market for software is $200 billion. IBM software products , marketed under the Lotus, Tivoli, WebSphere and other brands , provided $12.7 billion of IBM’s $87.5 billion in revenues during 1999.
IBM goes up against various competitors in the database, Web application server, storage management, security, collaboration and distance learning software markets.
And it does not ignore a key local business: wireless communications.
For wireless Web service providers, Mills says, IBM software engineers design products that respond to scenarios like a dropped call during a financial transaction. Such transactions not only have to be secure and reliable, but recoverable, he says.
If a person wanted to conduct a financial transaction and the software was right, Mills says, he could conceivably start a transaction on a handheld device, transfer the call to an automobile-based computer, then wrap up the transaction on an office desktop computer , all with the server keeping track of what’s going on.
“That kind of capability, you would think, would be a prerequisite to customers believing that the environment was reliable and you could depend upon it,” he says.
Businesses are just testing the waters here.
Banks and brokerage firms may now let certain key customers look up quotes or even trade on handheld devices, Mills says. The activity still needs some refinement, he says.
The wireless marketplace is headed for “a critical turning point” in shifting from simple information and simple, person-to-person communication to more complex scenarios, he says. “And the technology needs to be there to support it.”
Not surprisingly, coming from an executive just about to speak to his North and South American sales force, Mills says IBM has that technology.
Looking ahead, Mills says embedding intelligence in everyday devices , from automobiles to appliances , “represents a huge, huge market.”
For example, a soft drink machine hooked to a phone line can tell the distributor when it’s empty. Other machines can adapt to or communicate customer preferences.
Mills has been with IBM 28 years and took his current job in July. He reports to Chairman and CEO Lou Gerstner.
Just what is that experience like?
“It’s not a guessing game,” Mills says, noting Gerstner lays down the twin reasons why he might “take you out” as a senior executive: not taking action to drive the business, and not serving the shareholders.
“You’re not trying to figure out what’s on his mind, what does he really want you to do,” Mills says. “He’s very direct.
“He makes it easy.”