Large IT company business models and the cloud


I agree with your overall analysis that Cloud is changing business serving up cloud as IaaS is low margin business, but I also agree with @Jeff that selling the best business practice will succeed. To your point, the internal practice of the business only has to be “good enough” to succeed. Great business practices don’t ensure success any more than not so go ones failure. Abysmal business practices will sink even the best business.

I’ll also remind you I heard the same cries with “host to client/server”, “brick & mortar to e-business”, “coding to SOA”, and now “cloud”. I agree it is substantial and opens a world of opportunities. I don’t think wholes RIFs do anything but find the CEO and CFO a quarter worth of cash with longer term implications. What I do believe is change will always happen and businesses have 3 options: 1) Move (get out, sell off, etc.), 2) adapt (use the change to advantage), or 3) Die. Lack of decision and action is electing #3 and will never work in an ever changing environment.

SAP will adapt, it just may not have big salesforce and sell differently, because of the value in the optimized business processes. IBM will adapt, but may not have HW business and will learn to sell value on top of the cloud and not just the base cloud (IaaS) plus move most of its SW business to cloud like bluemix (

BTW, love to see what you think of the increase of the outside in programmer over the inside out programmer (traditional IT).

Vijay's thoughts on all things big and small

Earnings season arrived and I am wondering how long big companies can keep their current structures and business models . Size is not always an advantage – it can actually destroy the value of a company .

Big companies try to attack this problem by firing a lot of people . But I have hardly known a company that has succeeded much that way – only very few pull that off .

The problem with firing enmasse is that you have to use broad policies to determine who needs to go . When you fire 1000s of people – not only do you end up firing people who could have done wonders , you lose other good people who will leave because they feel they can do better elsewhere . Firing people lower down in the hierarchy rarely does any company any good. Those are the peeps who do actual…

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