Friday, June 22, 2007

Second Generations

In my last blog on rogue coalitions I wrote about second generation leadership within companies. I’ve seen this at many of the companies for which I’ve worked and it’s always been sad to witness.

Generally, most successful companies are formed on doing something different and often revolutionary. It’s a very difficult and arduous task to form a new company. It’s even more difficult to found a successful company. The most successful companies out there, especially in the IT industry, were founded on revolutionary thoughts. The leadership within these companies was singular in their purpose of doing something different, something provocative and something revolutionary. These leaders wanted to change the world.

In order to be successful these leaders had to have the passion and drive to convince everyone around them that they were on the right track. They had to fight the status-quo and articulate a vision that others were willing to follow. The successful ones had to fight tooth-and-nail to make sure everything worked appropriately. It was never enough to have a good product, that good product had to be combined with business savvy, insight and fearlessness.

Once successful, the enterprise becomes too large for any one individual to drive and control. The leaders need to bring in others. Here’s where the trouble begins. Does the leadership that has created a successful franchise instill the same sense of purpose and mission in the new employees or do they, instead, bring in functional personnel.

At some point, though, there is a critical mass that is reached where it is no longer possible to instill the same sense of purpose and mission. They no longer have a choice and they can only bring in purely functional personnel.

For the new employee their mission is no longer to change the world with a new software product or model, their mission is to collect license fees. Someone else’s mission is license enforcement and someone else’s is to explain why licenses are important. It is likely that no one remembers the reason the licenses were initially created or the reason the business came into existence or the revolution the original leader was fomenting.

Ultimately, the leader steps aside and the second generation takes over. At this point the enterprise is truly in trouble. There is no institutional passion driving sound business objectives because the business objectives are divorced from the original mission. The business objectives are disembodied activities headed by individuals with ridiculous titles such as Chief of Licensing or Director of Pricing.

These rogue coalitions are doomed to failure. Without the passion, drive and direction the individuals become nameless, faceless drones enforcing licenses for which the individual has no context in which to understand their own, broader purpose.

How can such a company survive? A company that enforces licensing terms because they’ve always enforced such terms, not because they make any sense, is a company doomed.

When the sum of the parts doesn’t equal the original mission the company can either fail or decide to no longer be revolutionary and to just execute the individual missions such as license enforcement. There are companies at this juncture today, the problem is most don’t yet know it.

1 comment:

Anonymous said...

...or they can pre-maturely release a component of their software as quasi-Open Source and then get caught with a price-to-service model that's too low ROI to attract new customers or to keep the existing ones. As if that wasn't enough, they could ignore their revenue-generating, technology-leading software component, perform an Open Source tease to frustrate their current customers and scare potential new ones, and release a "me too" solution that's cobbled together with "name brand" technology and their own, quasi-Open Source component. Ahem...

Open Source is a global commitment in deed, not just in name. Simply removing license fees to use the software doesn't enable a customer. Having a progressive vision, an able engineering staff, and a realistic business perspective on markets does; whether those qualities are tied to a license, subscription, or service model is a decision for the vendor not the customer.