What's cooking in the vendor's kitchen?
- 01 October, 2001 10:07
The very mention of IT companies using their own products forces a wry smile on even the most sober countenance. Inelegant though it may sound, the process is generally referred to as "eating one's own dog food".
Legend has it that flamboyant Oracle chairman and CEO Larry Ellison's plan to appear in a marketing campaign enthusiastically hoeing into a can of puppy chow was flattened by the company's executive vice president, Safra Catz. Catz may have been concerned about protecting Ellison's dignity, but her boss's idea was in keeping with the approach many vendors take when flirting with the notion of using their own products. If anything, Ellison's message was clear: "We are eating our own dog food, and, damn, it tastes good!"
Despite attempting to shun the rather unfortunate adage, IT vendors find that promoting in-house deployments of their latest technologies is not necessarily an unpleasant experience. Companies like IBM, for example, use their market position and brand recognition to attract the best and brightest young graduates into the fold.
Paul Kenny, director of IBM's Innovation Centre, explains that new graduates are attracted to the company with the promise of the opportunity to work with cutting-edge or emerging technologies.
Nicknamed "lab rats", new IT recruits are willingly locked away with state-of-the-art equipment, deep in the bowels of IBM's technology and operations showcase, the Innovation Centre in Pyrmont, Sydney.
"They don't just want to talk about what the technology is capable of in the abstract, they want to do it," Kenny says. "We are working on the idea that attracting and retaining the best in the marketplace comes down to providing them with the opportunity to do things of value in their career, and our focus is on enabling them to do that with our own technology."
The design and management of the Innovation Centre allow for newly developed technologies to be rolled out into a business environment, and to be tested by clients and employees alike. In order to harness the experiential data, IBM has set up an "Innovation Council" to implement IBM solutions in-house, which seeks and acts upon feedback from employees. Feedback is encouraged and even rewarded with free movie tickets and Palm Pilots.
What is interesting about the Innovation Centres' approach is that it demonstrates the implementation of not only IBM's technologies, but also the business processes that IBM encourages among its corporate clients.
"We are using the Innovation Centre to demonstrate to employees, partners and clients that the technological implementations are justified on a commercial basis," Kenny says. "It is not just lights - people are coming in here and working in real-time."
Alongside IBM technology, the Innovation Centre in Sydney showcases products from IBM technology partners. Avaya provides wireless connectivity throughout the complex, Ericsson is working in conjunction with IBM with the development of 3G wireless solutions, and the so-called "technology sandbox" is being completed with networking infrastructure from companies such as Packeteer, Cisco, Gadzook, Cacheflow and HP.
Despite Kenny's insistence that the Innovation Centre demonstrates the commercial viability of cutting-edge technologies, high-end technology invariably comes with an impressive price tag, even for its manufacturers. At an official cost of $46 million, IBM's showcase is not within the price range of most IT vendors.
Demonstrating IT infrastructure in action is one thing, but betting the company fortunes on an untried product is another entirely, as Cisco discovered when the bottom fell out of the Internet infrastructure market.
While the victims of April 2000's tech wreck were many and varied, there have been suggestions that Cisco may not have been as hard hit if it hadn't relied on its own "virtual close" software. Designed and implemented at a time when the company's meteoric rise outstripped even the over-hyped dot-comets, the software crunched the increasingly saturated market figures and spat out predictions indicating continued growth.
All signs indicated that the gold was beginning to peter out, but Cisco's virtual close software was telling it to continue to pump out picks and shovels at an ever-increasing rate. Six months later, sales had plunged by 30 per cent, 8500 people were looking for alternative employment, and shaken CEO John Chambers was writing off $A4.4 billion worth of stock.
Excessive reliance on auto-pilot has been blamed for many an aviation disaster; however, while switching to manual controls, Cisco CIO Peter Solvik claimed (near)real-time data provided by the virtual close system ultimately assisted in the company's recovery.
Meanwhile, Cisco Asia-Pacific is sticking to hardware and IP phones. Unlike IBM's Paul Kenny, Cisco's IT manager for the region, Darren Scott, has only one of his company's logos on his desk, although he points out that most of the Cisco equipment is at work behind the scene.
Yet, out of sight is not out of mind in Cisco's case. As with IBM, Scott emphasises the techno "pull" that is provided by the opportunity to work on high-end, cutting-edge solutions.
"We have a clear mandate to be Cisco's first and best customer," Scott says. "We beta-test our own products, and implement our own solutions via a phased roll out across different sectors of the company."
According to Scott, this early phase of testing is central to the developmental direction of a product line, with the internal feedback essentially helping to determine a product's future feature set.
"In a company like this one, you always have the chance to try out the latest development, whether it is software or hardware, a Cisco product or a development by one of our partners," Scott says. "There is a high rate of satisfaction when you see a product come onto the market that you trialled while it was still in development."
Apart from the IP telephone handset, you are hard-pressed to find the Cisco brand on Scott's desk. However, dozens of routers and switches hum and flash just metres away. This backbone, Scott believes, drives Cisco's productivity ever closer to the stated goal of one million US dollars per employee.
"One of the major attractions of working for a company like Cisco is that you can see yourself setting the industry standard. Our core technologies are essentially productivity-enabling, and you can see yourself as part of that enablement," Scott says.
Like IBM, Cisco's work practices are as much a part of its operations as the enabling technology. As major IT vendors are forced to show how their products can be implemented in a corporate environment, they are constantly redeveloping work practices to keep up with the new technological base.
But while flexibility and connectivity are the buzzwords of the Internet age, the resulting increase in productivity may not in fact lead to an increase in employee freedom. As Scott points out, increased flexibility and connectivity to the corporate intranet via VPNs and mobile computing can make it impossible to escape from the office.
"The technology is so pervasive you can always connect to the Cisco network," Scott says. "When you factor in US-based conference calls and the like, you end up with an extended work life."
In an attempt to remain a jump ahead of this phenomenon, IBM's director of human resources for Australia and New Zealand, Tony Nelson, places an emphasis on what the company calls "work/life balance".
"We have to make sure the added flexibility provides a benefit to employees; if they are able to work in multiple environments they should have greater control over their work/life balance, rather than being chained to the desk," he says.
Nelson is also focusing on the changing role of management in the wake of new technologies.
"We provide all employees with access to an intranet, which contains information about technology and company practices, and is also important in terms of flow of communications within the company," Nelson says. "We are using the facility to streamline communications to our employees, and give them the opportunity to provide instant feedback on changes to the company's practices."
There can be no doubt that the high turnover of technologies in IT vendors' infrastructure represents operational challenges, as well as an attractive bait to the industry's best and brightest. And the key to keeping them there, it would appear, is using the technology to keep them in the loop.