Enterprise reality check, January 22, week 3 - put your VR goggles on, baby....

This is your unfiltered view of enterprise highs and lows. Surprise takes from special guests may be included – scroll on. For a deeper review of my enterprise picks and pans, check my weekly, snark-infested Enterprise Hits and Misses columns on diginomica.

The best thing I read this week: I'm cheating on this, as it's a podcast, but I thought Mitch Joel's Six Pixels of Separation podcast with Martin Ford On The Rule Of The Robots really struck that edgy balance between AI as a force for (positive) change, and the intense problems we must confront. At one point, when Ford talks about how disruptive AI will be on the jobs standpoint (via automation), Joel asks the rarely-posed question:

Why would we build it if it's going to do that?

Ford's answer is well worth a listen.

Selected commentary on the biggest news story: Most stories on Microsoft's acquisition of Activision were a little breathless, waxing poetic on the Metaverse play Microsoft is making here. I thought this Axios piece on Microsoft's Metaverse Manouvering was useful, as it didn't get carried away with promises about enterprise Metaverse revolutions, and focused on the gaming impact. On DisruptTV, I challenged co-host Ray Wang on his views that this impacts Microsoft Office, perhaps as much as Azure. More on this next week, but for now, here's why I'm long-term bullish on the Metaverse, and it's not what you think. I have peered into the future:

We are overweight, pleasure-addicted 5G couch potatoes paying crypto taxes to big tech to interact in virtual worlds that offer a fantastical escape from the mundanity of our real lives...

Okay, a tad dystopian, I'll give you that. But when you don't feel like going outside (climate, disease, social unrest, better ways to experience events in your living room), and broadband keeps getting better, there is an undeniable economic opportunity there. On the positive tip, however, I think we can also claim these virtual tools for creative and interactive purposes. And yes, there are some terrific industrial use cases. The vapid consumer tech press may have moved on, but Google Glass, to name one, never stopped developing for industry.

I doubt the Metaverse will be a force for decentralization, Microsoft's money move proves that in my view, but Wang is right - that's what is at stake. He's also identified more than 30 enterprise use cases. Stay tuned on this one, this debate isn't finished.

Backchannel scuttlebutt: During an epic delivery snafu with Amazon, I had a customer service rep confess to me that Amazon drivers have been marking packages as "delivered" as soon as they pick them up from local warehouses. Bravo for the confessional, but this is the problem CX evangelists must grapple with. How can we deliver on customer experience when digital giants drive their employees into a KPI frenzy, marking packages as delivered to meet quotes before they fall into bed and do it all over again, while peeps like me interact with chatbots to figure out what went wrong?

My diginomica quote of the week: In Martin Bank's diginomica analysis, Microsoft/Activision Take 2 - there's a but...a big but, he called out an anonymous colleague who said:

I know Microsoft can walk and chew gum, but if you're part of their business software competition, don't you take some kind of comfort in a massive/potentially distracting gaming acquisition? They do make money on xBoxes. I just think from an enterprise/business software vantage point, you'd welcome this news if you compete against them.

Yeah, that colleague was me - that's my quote. So are you leaning my side, or are you with Martin's well-considered rebuttal? To me, the most interesting part are the industrial use cases Martin articulated. Getting called out is fine by me - as long as we can advance the conversation and not get caught up in flame wars, or worrying about being right.

Commenter of the week: Paul Greenberg, CRM pace setter, went off in last week's comments section on why digital transformation is falling short:

The reason digital transformations are failing is because they aren't digital transformations. They are marketing messages by companies who are claiming their increased use of digital tools is “digital transformation” and yet their business models haven't changed, their cultures haven't evolved, they are just using virtual communications a lot more.

But wait, Greenberg wasn't done: he nailed down one of my bones of enterprise contention: we should stop patting ourselves on the back for enabling remote workers with "cloud" and calling it a business transformation.

It's almost exhausting to hear the claims that Covid has accelerated the sprint to the finish line for digital transformation. At best it accelerated the sprint to the starting line.

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This edition's guest commentary

Who: Thomas Wieberneit

What's your enterprise story of the week, and why? My story of this week is the Microsoft announcement to acquire Activision Blizzard to bring the joy and community of gaming to everyone, across every device at nearly $70 bn, which sounds like a huge sum, but is actually not really, as the price 2 revenue multiple is below 10 and then Microsoft has the funds. Why is it so interesting? Because these days everyone (and their dog, I am inclined to say) is looking into this obscure thing that “Metaverse” is. Nobody really knows, nobody really knows what the value for the people actually is, yet everyone invests big sums in the hope of bigger returns. It will be interesting to see how the positioning game that is already going on in this next escalation of the platform game will pan out. As a platform game it is all about the number of people on the platform and then, of course, their data. Right now, all bets are open and it will be interesting to observe how the gaming and adjacent markets consolidate (remember that Take Two acquired Zynga for a measly $13 bn just a week ago?).

What's the underrated story too many are overlooking? Well, technically it was last week (January 13) but then this is exactly a week ago now. The news is about SAP announcing preliminary Q4 and Full-Year 2021 results. Why? Easy. Not too long ago Salesforce and Oracle announced their quarterly numbers. Salesforce’s growth was similar to SAP’s growth and Oracle’s Fusion and Netsuite ERP growth figures were well below SAP’s S/$HANA Cloud growth. A little earlier CEO Christian Klein got bashed in German Handelsblatt as in dire need to defend his strategy. Yet, the numbers and outlook given by SAP didn’t really get a reaction. Maybe, this is because they are preliminary …

You aired out some important views during my video show on why digital transformation is falling short. Can you give you short version of that for our readers?

We are confusing digitization, digitalization and digital transformation. Most companies around are still stuck with the first two. Digital transformation, first of all, is a business transformation. Digitization and digitalization are necessary precursors but not the thing. In brief:

• Digitization: Doing things better
• Digitalization: Doing better things
• Digital Transformation: Doing entirely different things

The long version is in my article Digitization, Digitalization, Digital Transformation – A Stake in the Ground.

The enterprise is dire need of: There is ample need for a change in how business success is evaluated. Most companies are looking at success from an inside-out angle: How can I sell more, how can I reduce cost, etc. Success is defined as selling more product. This is a thinking that limits itself. What would be needed is a stronger outside-in view. What do my customers/prospects need and or value? How can I contribute to solving customers’ needs?

This sounds like semantics but actually opens up the eyes and it makes success in terms of profitability, revenue, a consequence of doing the right thing, instead of the objective. Changing one’s thinking into this direction also helps employees see the purpose of their work and opens up a whole new world of opportunities. This is very different of what corporations nowadays tout as their “purpose”.?

What's the most overhyped thing in the enterprise? (Where are projects getting off track?)

The most overhyped thing right now is whatever is around “Metaverse”, “Web3”, “NFT”. I do see many of these topics as solutions in search of a problem. This is especially true for NFTs. I do also think that the acquisition of Activision by Microsoft and the strong moves of other (nearly) trillion dollar companies show that we can say good bye to the idea that “Web3” will be a decentralized new version of the Internet that puts more control into the hands of people as opposed to big corporations.

Thanks Thomas!

Jon’s whiff of the week is: There were enough whiffs this week to keep me busy in hits/misses for weeks to come. But for now, I've got to pick the 5G telecomms-versus-airlines US crisis. A colossal mess, a comedy of errors, a failure of regulators and corporate hubris - something that other countries have easily avoided. The US, however, managed to step in it, and step in it we did.

For my full whiffs collection, check my Enterprise Hits and Misses missives on diginomica. A new edition goes live each Monday morning.

This LinkedIn newsletter is intended as a jugular, no-fancy-formatting, best-of enterprise quick hit - with commentary, overlooked stories, and a few hype balloons punctured along the way. Then we end it - with plenty more to check out on diginomica if you want.