A few weeks ago, I
wrote about the difficulties many organizations face when they attempt to strike a balance between keeping up to date on Microsoft technologies and optimizing their internal operations. Many businesses and member based organizations are turning to packaged software products rather than taking responsibility for building business applications from the ground up. A similar case can be made for commercial software vendors who believe that their main competitive advantage resides in business application expertise rather than lower level technical innovations.
Domain Expertise as a Competitive Edge
While software companies that focus on building operating systems, programming languages, database software, and application frameworks must have competitive advantages in lower level programming, the same is not necessarily true for firms delivering specialized business application functionality to customers. Well designed business application software, particularly for specialized vertical markets, depends on deep business domain expertise of those who are developing the system.
Domain expertise in a particular industry takes a significant amount of time to acquire and application designers need to have the necessary level of business acumen required to efficiently translate requirements into software. This is a skill set that is often far different from what a lower level programmer would need to build developer tools or application frameworks. Even if a software company focusing on business application functionality has programmers with significant low level programming skills, it may still make sense to use a well designed business application framework for the same reasons that a company might want to avoid building in-house software from the ground up.
Ultimately, commercial software company executives need to ask themselves what motivates their customers to select their software over competing products. If the answer involves providing more efficient business productivity through extensive domain expertise, it may make more sense to invest heavily to improve business functionality rather than focusing on lower level layers of the software stack.
Risks Require Management
The strategy of focusing on business application functionality rather than lower level technology is not without risk. If a commercial software firm focuses only on business functionality while relying on partners or other vendors to supply lower level technologies, there is always a risk of falling behind strategically on big picture issues.
Managers can minimize this risk by associating with partners who have a proven record of innovation and by having enough expertise within the company to question the partner when it comes to technologies and big picture issues. Customers require complete solutions and rely on business application vendors to deliver turnkey systems. While controlling the entire software stack may provide a certain theoretical level of control, a software firm with limited resources will likely find it more effective to focus on business application functionality built on an application framework developed by a trusted and proven partner.
Aptify
Aptify's own case is not different from that which is being described above. It so happens that our company has two distinct lines of business operations: one focused on
Aptify RAD, our core platform technology, and the other is a domain-specific vertical market solution for
Associations, Membership, Events, and similar organizations. Our case is fairly unique since we have two successful and independent lines of business. In fact, other commercial software companies are choosing Aptify RAD as a business applications platform to build commercial software upon. At the same time, we have a large number of resources directly in the business of providing a particular vertical market with leading edge domain-specific functionality. To make this work internally, our development group focused on the AMS (Association/Membership) market, must focus purely on application functionality and business processes in the vertical and not get into the lower level development functions described above.