Running mission-critical applications in the cloud isn’t regarded a mere option for an enterprise anymore—it’s actually, well, mission-critical, according to NetSuite’s Zach Nelson. Nelson, President and CEO at NetSuite—which he has led since 2002 after holding senior positions at Oracle, Sun and McAfee—sat down with us for a chat on the main challenges confronting enterprise business models and the technological remedies for them.
“In 2002, nobody thought you’d be running mission-critical applications in the cloud. Now, people can’t get there fast enough. It’s kind of strange to think that nobody thought that, because if you look at the first generation of super successful web companies—Amazon, eBay—they were all cloud companies,” he states.
What’s happening now, Nelson observes, is that businesses of all shapes and sizes are recognizing the need to become an Amazon or an eBay. “Every industry is being changed by the cloud, and so they have to change their business models to determine their capabilities to use this ubiquitous network. That’s the big thing…it’s no longer a question of ‘Is the cloud the future?’—it is,” he affirms.
Changing business models
Before the cloud came into the picture, business models were fairly straightforward: product companies manufactured and shipped things, and invoiced for them; services companies managed projects and their employees, and invoiced for time. These days, disruptive technologies have played transformative roles across both business models, such that product companies are becoming service companies, and vice versa, or they’re both at the same time.
“The challenge for companies now is that things in the cloud economy just got more complex because people are still going to want to buy products, they’re still going to want services, and they’re going to want both. Now companies have to deal with the complexity of almost managing three business models in one,” says Nelson. He adds that what excites him the most about NetSuite is that, since day one—and “kind of by accident”—they’ve built a system that enables exactly that.
When NetSuite started in 2002, CRM and ERP were incorporated into a single business system. “Our architecture—both from a data model standpoint, with the front and back office in a single tightly-coupled system, and from a delivery standpoint of anytime anywhere access—appealed to two industry groups: distributors who sold things, and services or people who sold time,” remarks Nelson.