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Conway’s law but for software: Salesforce and SAP

Conway’s law aptly states:

Organizations which design systems … are constrained to produce designs which are copies of the communication structures of these organizations.

I’d like to propose a parallel “law,” if you will. I hypothesize that software companies (that’s increasingly all of them) are incented to innovate primarily around the central object, or data structure, in their software — and consequently constrained from innovation outside the central object.

For Salesforce.com (SFDC), its software is centered around people, primarily customers. This has influenced and will continue to influence corporate strategy, product design, and innovation. Witness the recent “customer company” tagline that SFDC is attaching to everything it does and that affects its higher-order thinking.

For SAP, on the other hand, everything is centered around purchases. Think ERP, purchasing, inventory management, and so on. Its central object is in fact the purchase rather than the person, as it is for SFDC.

In each case, innovation will be highly constrained outside of these core objects, particularly when it comes to second-level connections. In other words, for SAP, the purchase connects to the buyer connects to ?? And for SFDC, the converse holds true — it sees what’s directly connected to the customer, but what about the next step? This mindset will influence initial strategy but pervades into hiring, promotion, and performance reviews to continually lock companies further into their central objects.

If you want to understand company mindsets and their future strategies, you could do a lot worse than combining Conway’s law and this idea of central objects.

Disclosure: Salesforce.com and SAP are clients.

by-sa

Categories: corporate-strategy, salesforce, sap.

  • Mike Leach

    I’d take the analogy further to say Salesforce, SAP, and Oracle are all constrained to OLTP data and ACID transactions; whereas the next generation of activity-based streams and Internet of Things are not built upon SQL.

    This is not a particularly bad thing. They need to co-exist. Financial transactions must be 100% durable while the IoT must be ephemeral and fast (non-transactional).

  • http://blog.pokarov.com vlvl

    hmmm… if you look at one of the main drivers to SAP adoption (and ecosystem) its actually around a core object which is “Employee” – HCM, Payroll, Purchaser. At some point, IMO, SAP lost its focus there and hence the SFSF acquisition (its not just the cloud angle). B

    • http://redmonk.com/dberkholz Donnie Berkholz

      You may have nailed something there about losing focus — possibly because it wasn’t the core object?