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Web Services for SMEs. I had the privilege of spending 45 minutes on the phone today with Julian Bond as part of the research for my book on strategies for web services. Julian brought up a fascinating issue: Few people are yet talking about web services for small and medium enterprises: the restaurants, the doctors and the small manufacturers. Linking to their suppliers and customers is just as valuable for SMEs as it is for the big guys, but SMEs don't have programmers. How are they going to take advantage of web services until long after those with more resources solve all of the problems of incompatibility, reliability and security? SMEs buy off-the-shelf software that works out of the box. They live in a world that is standardized by virtue of being shrink wrapped. In this world, the desktop is more important than the server, and it's a world controlled by Microsoft.
Consider, as Julian suggested, the value of direct ledger-to-ledger transactions. Isn't that the ultimate goal of at least one aspect of web services? Imagine what it will take to build an integrated ledger-to-ledger web service supply chain for a large organization, even with a slew of programmers. How can SMEs even think of achieving such integration without help?
Now ask yourself, why did Microsoft by Great Plains [accounting software]? Was it to be the leader in the SME accounting software market? Maybe. Or maybe there's something bigger going on. Here's a scenario: Microsoft releases the .NET version of Great Plains. It has, built in, ledger-to-ledger communications. It talks to other Great Plains implementations straight out of the box. No code to write. Do these web services need to meet every standard? Must they be able to talk to systems running software from IBM, Sun or BEA? Not at all. Great Plains already has a strong installed base, and once a capability such as this is available, Microsoft can move through the SME universe, industry by industry, taking over complete value chains. (Remember, SMEs don't have as substantial an investment in applications beyond their accounting pacakges.)
And it's not just the software sales. SMEs will need a third party to provide authentication (PKI) and audit services. Who's well equipped to provide those services and to collect the monthly and per-transaction fees? And who's in a position to address the very small business (the SOHOs) by providing compatibility through a browser-based service? Can you say, "bCentral?" All that's missing are full-time broadband Internet connections for SMEs. What's that, two years out? About the same timeframe in which Microsoft could have the other pieces in place.
I haven't heard any of this from Microsoft, and I don't think Julian has either, but it's so incredibly powerful, it's a virtual no-brainer. What do you think?
Posted Sunday, March 17, 2002 3:18:42 PM 
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