Connecting the Dots

Years ago Apple was successful in corporations.  A lot of the success came from newly graduated college students carrying their Apple computers to work.  Computers were new and anyone with computer knowledge was well respected.  There were at one time lots of enterprise customers using Apple computers for a wide variety of things.

In the mid-nineties for whatever reason, Apple parted company with most enterprise customers.  Windows NT was in a rapid ascendancy and Apple's survival was in question.

Today Apple's products look great but there are some real differences in enterprise computing that might make it much harder than the first time Apple stormed the enterprise.

When computers came into most companies in late eighties there were no networks.  In fact some of the earliest networks were AppleTalk networks which allowed early users to share expensive resources like LaserWriter printers.  Desktop publishing helped make Apple products viable in the enterprise.

Both Apple and enterprise computing have evolved.  Both are more centrally controlled. Today everything is networked.  Very little goes on at Apple that isn't blessed from the top.  Most enterprises let very few if any computers in the door that are not blessed at corporate headquarters, and they let no computers they didn't buy on their networks.   A relatively small number of CIOs control a tremendous amount of computing resources in the US, and they control it very tightly.

Microsoft has done a very good job courting these CIOs and delivering products that meet the needs of their enterprises.  Microsoft products are by no means perfect but they certainly get the job done and Microsoft has provided products such as Active Directory which are designed for enterprise needs.

Apple has always focused on individual users.  Empowering people to do what they might not be able to without an Apple computer has always been at the core of Apple.  Along with empowerment, there has always been more than a hint of a rebel image attached to Apple.  This rebel mantle was even passed to users through the "Think Different" advertising.  Thinking different is the last thing enterprises want and isn't even on the list at most government agencies.

Unfortunately "Think Different" was more than a just an advertising slogan at Apple.  It was a way to do business.  While companies like Dell and MS tried to get close to their customers.  Apple whether consciously or not started distancing themselves from customers in the mid to late nineties and kept thinking of ways to be different.

Secrecy and innovative product designs were often used as excuses to keep not only customers but also field employees from providing input to Apple's direction.  Decision making at Apple became more and more centralized and as many customers and partners who have tried to do business with Apple will tell you, doing business with Apple got harder and harder.

In general, you can sum up Apple's business practices as "Do it Apple's way or hit the highway."  That might work great if you are in a business where there is no competition or where the customer has no other choice, but it doesn't work at all when you have only 2% market share.

None of this mattered to Apple because deep down executives believed the Apple rebel alliance would eventually overthrow those in power and lead Apple back into the enterprise. Perhaps the disconnect with reality had to do with Apple hiring so many executives from software firms to sell hardware.  Effectively selling Apple hardware is not something you pick up overnight or even through canned training in spite of what some in Apple might think. Selling Apple hardware means figuring out how to connect not only emotionally with the customer but also how to meet their real computing needs in a sophisticated environment.  Even the most skilled Apple sales person will tell you that turning a Windows account into a Mac one is an almost impossible challenge given the technical and software issues.

Unfortunately even with the best technical and sales help you don't get back into the enterprise by being a rebel, by being cute, stylish, or as we found even secure.  You get back into the enterprise by slowly proving that your products can do the job better than the competition and for less money.  Doing this takes time, money, and human technical resources.

Last year it was widely reported that Apple had set up an enterprise sales team.  As many current Apple customers know, Apple has had a continually morphing enterprise sales team for years.  The addition last year was a call center to win over the enterprise.

I really do not know how effective this has been, but having sold Apple products successfully for many years, I have not come across very many Windows users who will throw their currents systems out the door just because they get a phone call or maybe even a seed unit directed from an enthusiastic Apple phone sales person who could provide great phone support.

What I have seen in the limited cases where Apple could muster the resources is tremendous success when Apple field people with exceptional technical knowledge can work over time with customers to prove the capability of Apple products.  This has opened many doors for Apple products. 

Apple the corporation has not taken advantage of many of these doors and in fact is likely still slamming them shut.

To beyond the open door requires skills that are foreign to Apple corporate.  Those skills are listening to the customer, following up with the customer, and ensuring that the customer is successful.  Partnering with customers is how you get your product made part of solutions that you could never dream of by yourself.  Apple really does want to do almost everything on its own terms in spite of even their commitment to Open Source.  Almost all Apple technical resources are focused inwardly.  What Apple really needs is a lot of high level externally focused technical support to win the minds of key customers.

Sadly Apple no longer knows how to meet the customer on their own ground and create a win-win situation for large enterprises.  While they may go in and give away the farm to win some large educational deals, the interest in taking the time to slowly work their way back into the enterprise business and government world just hasn't been there.

The tragic thing is that if Apple had focused on the enterprise a little more they might not have to be so desperate for those big educational deals.  As I watched school boards like Virginia's huge Fairfax County move away from Apple, I could only relate it to my experience with our local school board.

People wanted their children to be schooled on computers that they perceived would be the ones that they would use in their work places.  Apple which lost much of its relationship building skills in the mid-nineties could only rarely overcome this pressure. While IBM and other were experts at utilizing ex-employees to help in the sales process, most ex-Apple employees are so alienated that they certainly are not going to stick their neck out for Apple.

Probably the most ironic part of this is at the time when Apple was doing very well with scientists and researchers in the government and when Apple educational sales people were taking the most heat, the internal communications at Apple were so bad that only a few in education knew of the government successes. Even less were willing to connect the dots.  I can even remember trying to hook an Apple education regional manager up with a key person who could help them win an initiative in the DC area.  The phone calls were never even returned by the Apple person because fundamentally he believed he didn't need anyone's help.  He and his superiors did not understand the connection between the enterprise, higher education, consumer, and K-12 computing so they lost the deal.

In spite of what Apple has believed for so long, it is impossible to isolate a couple of markets from the others.  They are intimately connected just not in the way that Apple perceives.  The idea that consumers are going to change what companies use is out of touch with reality.  However, companies can change what consumers use by making certain that people work more at home.

With Apple all but ignoring the enterprise market, it is hard to relieve the pressure on K-12 school boards without cutting sweet-heart deals which still won't matter when the kids go off to college or get a job.

No matter what Apple believes, there are only a few places where individuals decide what they want to use for computing. Some consumer do make those choices. Scientists and researchers also often chose their computers.  Those markets of choice are great markets where Apple can have more success than in the more controlled markets. They won't really move that 2% market share very much, and winning users in those markets will never open up the enterprise markets because those markets often operate indepently from the enterprise.

None of this will change the fundamental cost and support equations which are driving enterprise computing and to a certain degree consumer computing.

In order for real change to happen,  Apple has to become an active participant in the enterprise world.  That means subjecting Apple products to suggestions and perhaps even some criticisms.  It also means listening to customers and delivering on their requirements.

It means testing and developing products in conjunction with customers not in isolation from customers.  I can tell you that no one except the Mac faithful really cares about the features which are going to be in the next release of OS X.   There might be lots of speculative press, but OS X isn't even a side note in most places in spite of it probably being the best OS on the market.

Do the vast majority of enterprise players really care what is going to be on the next Mac desktops, absolutely not.  They have so few it doesn't matter.  I might care, but I love Macs in spite of Apple which not so surprisingly is a sentiment you often hear from long time Apple users.

However, if Apple worked to ensure that key enterprise customers could buy products easily on their own terms, be assured of a consistent product configurations over a long period of time, and non-disruptive upgrades at jointly planned times, enterprise customers might start taking Apple more seriously.  This would especially be true if Apple started making appearances where enterprise customers get together to talk and learn from each other.

Apple has some very cool technology but much of it is untested in enterprise settings.  Somehow they have to build the relationships to make large scale testing possible.  Telling people that Apple the corporation runs on OS X means almost nothing.

It all comes back to focus, while Apple has always hoped for that easy enterprise win, maybe even one  closed only with a phone call, other companies have been sending out system engineers for years to set up and prove the reliability of their desktops, servers and software.  While Apple products always have a few surprises, tweaks or undocumented features to keep people on their toes, other vendors have been trying to remove the surprise from their enterprise products.  If Apple could focus the energy that it gives to one big education deal on the business and government enterprise world and place the human resources behind it to be really successful first for the customer and then for Apple, then enterprise customers might start taking Apple really seriously.

Of course they still have to forget the last time that Apple abandoned them.  Winning the enterprise for Apple is mostly about changing Apple's corporate culture which as anyone will tell you is going to be really hard to do.

Fundamentally it would mean coming down from Mount Cupertino and mingling with the mere mortals, but it could be the salvation for Apple's computing products.

Taking a significant chunk of Apple's cash horde and working to be successful in the enterprise would help all of Apple's computing markets.  Apple could do even greater computer products if they took the time to understand what customers want in large scale computing instead of just focusing on the individual end user exclusively.  A public road map for OS X would go a long way to opening doors for Apple as would an extensive seeding of Apple's Xserve products along with the system engineers to make them hum and actually be meaningful elements of the enterprise.

The choice is Apple's, invest in the enterprise, build real relationships at high levels or keep hoping that a phone call might turn up a customer that will change the dynamics of the enterprise market.

I have a pretty good idea of what the odds for success are on the phone call.

Comments

[Stephen Bates]

Apple has always been about empowering the individual to individually create great things. This is the core focus of their product set, from the "i" mantra of the power of one, to the privacy mechanisms built into the operating system. As such, it is reflected in their go-to-market strategy of Retail & Consumer at the expense of Enterprise.

Microsoft is always been about empowering the organization to collectively accomplish great things at the expense of the individual, and as such, is reflected in their corporate culture and sales methodology focusing on the Enterprise. While there are some Consumer and Retail offerings, they have not been as successful as their Enterprise efforts.