Back in 2009, my colleague MG Siegler wrote a brilliant piece titled ‘Keep It Simple, Stupid,‘ which delved into how having a simple and easy to use product is a key formula for winning in the consumer tech space. A few days ago, Greylock Partner John Lilly echoed MG’s thoughts, explaining that simplicity is quite simply very hard to beat. While this doctrine has been applied to consumer technology products like Dropbox, Gmail, Twitter and most famously, Apple; reinforcing simplicity in the product thought process is becoming an ever-present part of enterprise technology as well.

Almost every pitch I receive for an enterprise product, whether it be in the business intelligence, big data, storage, or even virtualization space, includes the key phrase, “this product is extremely simple to use.” Part of this is the fact that many of these products are based in the cloud, which adds to the whole consumerization of the enterprise trend that is taking place.

But the enterprise is taking this a step further than just putting applications in the cloud when it comes to actual design and ease of use in the user experience. Take cloud storage giant Box.net, for example. The startup and its CEO Aaron Levie have been preaching simplicity in the enterprise for some time now. As Levie writes, complexity “serves as an easy – but ultimately blameless – scapegoat for failed deployments and lagging user adoption.”

Box’s drag and drop interface, which allows users to simply store and save files, avoids the complexity of many legacy options. The UI is clean, uncluttered and interestingly, Box hasn’t been in any rush to add bells and whistles to the product besides security and collaboration features. In fact much of the complexity exists behind the product, where the user doesn’t even interact.

Another area where simplicity is ruling is business intelligence. Splunk, which just filed its S-1 for an IPO, has been able to make a real business out of simplifying IT logs. Newcomer to the space, Domo, also promises a dead-simple interface for analyzing massive amounts of IT data.

Accel partner Ping Li agrees that the best enterprise applications in today’s world hide the complexity of the business processes running on the backend. He believes that while Apple has influenced  consumer technology in the design and product areas, the iPhone and iPad creator is also having a big impact on the enterprise. “Steve Jobs made phones and computers easy to use, and we’re seeing the Apple-effect bring simplicity into the enterprise,’ he explains. Li points out that the iPhone and iPad are complex products when it comes to the internal hardware components but on the exterior, are incredibly simple to use.

PandoDaily’s Sarah Lacy recently wrote, there’s a new guard of entrepreneurs who are starting enterprise companies. Sarah says the ‘consumer kids’ have started creating enterprise companies, and are part of the consumerization of the enterprise. And these entrepreneurs are approaching the product for a simpler, more user-friendly point of view.

But developing these basic UIs for complex problems in the enterprise is a huge challenge. As Lilly writes, “It’s devilishly tough to build complex systems like software that actually show as simple interactions.” It’s something that Apple has mastered, and a number of enterprise companies are starting to catch on. Startups like WibiData, GoodData, and Code 42 are providing simple ways for enterprises to perform a variety of important and in-depth functions on the back-end, such as analyzing user data for personalization efforts, or developing hybrid storage solutions.

We’re also going to see more and more startups that are tackling even more complex enterprise interactions like virtualization, and creating extremely simple ways to take care of these problems.

Enterprise software is by its nature complex, but the user interface doesn’t need to be. We are all consumers of information, whether at work or at home. Any designing software needs to think about how to make it a joy to use and get people to use it repeatedly. Keep it simple, and we’ll keep coming back.

Photo credit/Flickr/bjornmeansbear

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According to a new report from managed enterprise mobility provider Good Technology, iOS devices (iPhones and iPads) hold the top three spots in the list of the top 10 enterprise activations by device type. The report includes data gathered by Good for Q4 2011 and includes half of the Fortune 100, providing insight into enterprise activation trends among some of the world’s biggest businesses.

The company found that despite Android’s overall market share growth and steady absolute growth among Good’s customers, only 35% of all smartphone activations were on Android, compared with iPhone’s 65%.

The mid-October release of the iPhone 4S helped that particular device quickly earn the number one position on the top 10 enterprise activations list, with the iPhone 4 moving into spot #2. The iPad 2, meanwhile, claimed the third position.

Since there are far more Android devices than iPhone models, it’s not as fair to compare trends on a device-by-device basis. After all, there’s aren’t just a couple models of Android phones out there – there are dozens upon dozens of “top” (popular) devices.

However, even when looked at as a whole, Android activations accounted for just 35% of the smartphone activations and only 6% of tablet activations. The Samsung Galaxy S II was the top Android device at spot #6 and was followed by the Motorola Droid Bionic, the Motorola Droid 3, Sprint EVO 4G (Q3′s most popular Android device) and the Motorola Droid X2. Motorola phones were popular over the course of the past year, too, and were represented in the top 10 each quarter.

Good does note that iPhone activations had slowed in the previous quarter, in anticipation of the new iPhone, then jumped significantly after its launch, with 31% of smartphone activations from that device alone. But collectively, iOS devices accounted for over 70% of all activations in Q4, an indication that enterprise customers’ iOS preference wasn’t just being boosted by the iPhone 4S launch. iOS is the preferred choice in the enterprise, Good says.

On the tablet front, iOS’s domination is even more apparent – the iPad and iPad 2 account for 94% of the total tablet activations in Q4, compared with 6% for Android tablets, where the Galaxy Tab leads the pack. iPads were most popular in three industries: financial services (accounting for 42% for the quarter), business/professional services and life sciences.

Going into Q1 and Q2, Good says that it expects iPad and iPad 2 activations to slow heading into March, as customers prepare for the (rumored) launch of the iPad 3. It also expects Android activations to increase on a relative basis after the immediate impact of the iPhone 4S lessens and as BYOD (bring your own device) programs become more common.

However, says John Herrema, Senior Vice President of Corporate Strategy at Good, the company expects the iOS/Android numbers to be roughly the same during the first half of 2012 as they are now. A change would require a major shift in tablet trends. “I don’t see that happening with the iPad 3 on the horizon,” says Herrema.

“If Android and iOS split smartphone [market share] or even if Android takes the overall smartphone lead, it would still likely be no more than 40% of all Good activations overall, given the dominance of Apple on tablets and the large numbers of tablets we are activating. Meanwhile, I don’t see Android dropping substantially below where it is now because that would require major shift among BYOD smartphone users.”

We should note that this report does not look at RIM devices or Windows Phone, as Good doesn’t have insight into these platforms. This is only a comparison between the iOS/Android adoption rates in the enterprise, which by itself, limits itself to enterprise environments where BlackBerry has already fallen from favor.

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Enterprise software company TIBCO is debuting a new version of its Yammer-clone Tibbr today. The newest version of the company’s social communications app includes geo-location capabilities called Tibbr GEO, which integrates the ‘check-in’ model in the enterprise.

By incorporating location into Tibbr, the service wants to physical places into data hubs that can immediately stream important insights relevant to that specific place. Tibbr GEO gives companies the ability to tag important places, whether in the enterprise or as part of the extended enterprise. As Tibbr users approach these places, they’re automatically presented relevant in-stream information.

For example, Tibbr says the geolocation feature could turn a gate into a contextual relevant data hub to give agents, pilots and flight attendants insights as they approach the gate. Or the section of every retail aisle could include data on individual shelf space, insights about individual products, how they’re selling, how fast they’re moving or how a new location might be affecting sales.

Tibbr Mobile applications now use HTML5 to deliver users a consistent mobile experience across all platforms and has also been updated to support offline access.

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Enterprise-focused cloud performance analytics company Tidemark, formerly known as Proferi, has raised $24 million in new funding led by Redpoint Ventures with existing investors Greylock Partners, Andreessen Horowitz and Dave Duffield, co-founder and co-CEO of Workday participating. This brings the total amount raised to more than $35 million. Redpoint partner Geoff Yang will join Tidemark’s Board of Directors.

Founded by Romanian entrepreneur Christian Gheorghe, the Tidemark Enterprise Performance Management Platform delivers real-time, risk-adjusted metrics management; strategic, financial, operational planning and forecasting; and profitability modeling applications.

Tidemark’s premise is that enterprises are investing billions yearly in traditional business intelligence systems that were not built for today’s data deluge and do not provide the forward-looking analysis that is required of businesses today.

Basically Tidemark monitors and analyzes business data, including key performance indicators, key risk indicators and other data for enterprise business planning functions. The software can produce full profit and loss reports by product, customer, supplier and channel to understand the detailed drivers of cost and improve margins.

The web applications are built with a HTML5 user interface and includes application components such as processes, goals, dimensions, KPIs, calculations, risks and controls. Tidemark also features integrations with a number of cloud and on-premise systems for sourcing structured and unstructured data including PDFs, MS Office documents and blogs.

The new funds will be used for customer acquisition.

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The Linux Foundation is sharing the results of their latest invitation-only survey of enterprise Linux users. Their last such survey, in August 2010, revealed Linux was gaining popularity in enterprise computing. It should come as no real surprise that the latest survey shows more of the same.

A lot has happened since late 2010, and the Linux Foundation survey reflects that. In “Linux Adoption Trends 2012: A Survey of Enterprise End Users” we find that a substantial number of enterprise users “expressed concern with the rapid growth of data, and Linux is clearly the platform of choice to address it.” Less than half of respondents are planning to use Windows to handle their “Big Data” requirements.

While nearly 80% of respondents expect an increase in the number of Linux deployments in their organizations over the next five years, only 21.7% of those surveyed expect an increase in the number of Windows servers during the same time frame.

Perceived technical barriers to enterprise Linux adoption have dropped significantly, too. Only 12.2% of respondents cited technical issues as an impediment to success, down from 20.3% from the last survey. That says a lot about the overall value proposition for Linux installations.

It’s worth remembering, though, that this was an invitation-only survey. I’m sure a similar survey from Microsoft would yield results more pleasing to Redmond. Nonetheless, Linux is clearly at the vanguard of technical innovation, both for the traditional enterprise data center as well as for nascent cloud computing solutions.

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Popular link-shortening service Bit.ly is today announcing the launch of Bitly Enterprise 2.0, a new version of its enterprise-friendly dashboard. The Bitly Enterprise platform, which helps businesses with multiple social media accounts monitor the impacts of their content’s distribution, will now include the first production release of the company’s brand-new search technology, allowing customers to track content around any subject or phrase across the entire social web – not just Twitter and Facebook.

This technology is providing access to a new view of the web. The web is no longer just a list of linked pages, but a web of fresh, social and viral content that’s weighted and ranked in real-time, and, in many cases, before Google applies its own PageRank to it.

Bitly’s social search engine is able to track the entire Bitly universe, explains CEO Peter Stern, which includes billions of pieces of content, with around 15 million unique pieces from over 100 million shares added daily.

When Bitly shortens a URL, it also crawls and classifies the URL. These links form an index of the most viral content on the web, which, through the Enterprise product, allow businesses and brands to see which items (posts, tweets, articles, etc.) are getting attention.

The new search technology was originally launched into beta testing in October, with the first part being a sentiment analysis system with alerts. Today’s dashboard update includes that feature, as well as tools for managing multiple accounts (Bitly Composer) and message optimization. The latter lets customers automatically share content at precisely the right time, based on when it will be most relevant to the audience and most likely to drive traffic. (For more details, see Bitly’s blog post).

One of the key benefits to the service is that Bitly’s technology doesn’t just track social mentions – it predicts the future, too. For any given search query, Bitly predicts which stories will get the most attention over the next 24 hours. And the company uses its own analytics to make these predictions in real-time. That sort of thing is invaluable to businesses and brands who need to be able to see a shift in sentiment (especially a negative one) before it’s too late. It can also help identify good content that a brand could choose to promote as well as provide ways to view content’s popularity by region, domain or social platform.

In truth, Bitly’s social search engine can be understood as being something like a “Google,” but for the social web. Instead of tracking webpages, Bitly tracks topics. And instead of PageRank, it has its own ranking parameters (17 in all), the most critical of which is, of course, clicks. It also tracks where those clicks are from, the platforms being used, the quality of the sources (i.e. organic vs. inorganic sources) and more.

“The larger story here,” explains Stern, “…is that we’re taking a view of the web not from a link-based point of view…it’s above link-level, page-level or even domain-level analytics.” It’s a different view of a different web than the one Google sees.

What’s most interesting this, is how much of a long tail there is to it. Bitly got its start as the preferred link-shortening service for Twitter (before Twitter launched its own), but the company is no longer limited to tracking Twitter. In fact, Twitter is just 8% of the company’s traffic, and Facebook is just 7%. Today, people are clicking and engaging with Bitly-powered links all over the web. There are over 100,000 in-code sources within applications, for example, plus web-based sharing buttons, links shared in virtual worlds, links shared through texting, within chat, even within games like Minecraft.

Says Stern, the company hasn’t yet considered building a consumer-facing service for its social search technology, but it could if there was interest. (YES THERE IS). Given Google’s decision to forgo a realtime search vertical in favor of promotion of in-house content from Google+, it seems that now would be the time for such an offering, if ever.

Below, a majorly cool video of Bitly traffic throughout the world, which shows the geographic location of the click and keywords associated with the content. Whoa.

Bitly: World Vis (2 / 3) from Micha Gorelick on Vimeo.

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NewsGator. Those of us who were using RSS readers in the middle of the past decade most likely think of desktop app FeedDemon for Windows or desktop/mobile app NetNewsWire for Mac when we hear the name.

But the company has spent the last several years turning itself into an enterprise networking company that competes with Jive, Salesforce Chatter, Yammer and the many others out there. And it’s had its biggest year yet in 2011, chief executive JB Holston tells me, by steadily building up its business on top of a place you might not have thought of: Microsoft SharePoint.

It’s riding the popularity of simpler social software for businesses by bringing industry-leading features to Microsoft’s extremely full-featured and extremely arcane collaboration platform, which has 125 million or so seats worldwide. Which is to say, a big pool of clients who don’t naturally gravitate to the freemium model that some competitors have used to get in with small and medium-sized businesses. Instead, all the products cost money. (Also, note that the RSS reader, which are still available for download after all these years on the NewsGator site, are now owned by Nick Bradbury and Black Pixel, respectively.)

The results in 2011? NewsGator added one million new paid seats over the course of the year, on top of its existing two million. Those additions aren’t just from a few clients who went all in, Holston says, but from among the 300 companies using it now. 100 of them were new last year, he adds, including both the “Global 2000″ corporate customers that normally it targets, as well as medium-sized businesses of 5,000 seats or less who decided to buy in.

Having been founded in 2004, and having raised some $39.3 million in venture backing, the company has come a long way to being profitable and growing across its key metrics.

How did the transition happen? Holston says that back in 2006, defense contractor Lockheed Martin had taken its enterprise RSS service, cobbled it together with SharePoint, Google search and some other features to create its own “Facebook for enterprise.” The SharePoint team at Microsoft noticed, and talked to NewsGator about building a fuller-fledged product line.

NewsGator then went on to launch the first versions of its modern software suite at the Enterprise 2.0 conference in 2007, and has been expanding its business since then. Today, the components for its marquee product line, Social Sites for Microsoft SharePoint 2010, include Microblogging, Activity Streams, Communities, Spheres, Social Profiles, Social Insights, as well as desktop and email clients, and integration with Microsofts Lync and Glassboard products.

Beyond these Facebook-style features, the company has taken the typical approach among enterprise vendors, building out additional features for compliance, IT support, local hosting etc. While it provides APIs to import or export data from other products, like Salesforce’s Chatter, SharePoint is where it’s staying focused on, Holston says. ”Our view is that there’s so much that Microsoft is doing to continue to push their enterprise relationships that we can leverage, that we think it’s a rich place to stay.”

When I asked about the long-time plans for the company — say, an acquisition by Microsoft, or an IPO — he said that the plan for now is continuing to grow the company as its core business continues to take advantage of the current market.

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Cloud storage platform Box (which you no longer have to refer to as Box.net as it now owns Box.com!), has seen incredible growth over the past year, both on the consumer and on enterprise side. Much of the growth has been driven by mobile, with the company seeing a 140% increase in mobile customer implementations each month in 2011, leading the total number of new mobile users to jump up by 171% monthly.

By year end 2011, Box’s total mobile user count reached 1.9 million, up 9 times over 2010. But nowhere has mobile’s impact been more felt than in the enterprise, where iOS and Android especially have driven business adoption of not just mobile apps, but the cloud in general.

In terms of mobile platform adoption, there were more than 1.2 million iOS app downloads in 2011, 462,000 on Android, 200,000 webOS downloads and 51,000 on PlayBook. (Yes, PlayBook!) These numbers include both consumer and enterprise growth combined, however.

But when Box tracks its enterprise sales, it tracks the reason for buying, and this past year, the company found there was a 30x increase in the number of enterprise deployments that were mobile-driven. So while mobile user growth may be up 9x, the sheer need for mobile connectivity is what’s driving its business. The mobile needs of the enterprise is affecting the company’s bottom line with Box seeing 3x revenue growth over the past year, as large organizations, like Procter & Gamble, McAfeee and AAA for example, signed up for the service. The enterprise customer base, meanwhile, grew by 2x and now includes 82% of the Fortune 500.

In the enterprise, iOS (iPhone, iPad) saw the most adoption, with 5 times year-over-year growth from 2010. Interestingly, Android is growing at a faster rate: 7 times year-over-year growth, even though it isn’t the largest mobile platform Box supports (iOS is, and more so the iPad).

Specific industry verticals are adopting Box at a faster rate than others, too, with the biggest jump coming from the Food and Beverage industry (up 7x), where Box counts Red Bull, Dole, PBR and others as customers. Because of the workflow-based nature of many of the industry’s tasks – like tracking product from the field to processing – this group was also big on the building custom applications on top of Box’s platform. Box now has over 130 apps integrated with its service and 5,000 developers.

Meanwhile, more traditional use cases involving knowledge worker and document sharing led to greater adoption in Financial Services (up 3.5x) and Health Care (up 3x) in 2011.

What’s interesting about these mobile adoption trends is the impact they’re having on cloud adoption. Says Box’s VP of Mobile, Matthew Self, “one of the big drivers we see for mobile adoption – and one of the big reasons why mobile deployment growth was actually higher than the user growth – has to do with the fact that enterprises are adopting cloud services because of mobile.”

“Mobile adoption is actually driving cloud adoption,” he says, “which isn’t totally obvious. But when you get to mobile, it isn’t about Microsoft anymore. Less than half of the computing endpoints in the world are Microsoft now…They’ve forced CIO’s to defect from Microsoft’s own entrenched postion, which is sort of bizarre. But it’s not like a CIO can say, ‘oh, I’ll just wait a year or two on mobile.’”

Ouch! (But totally right).

This exit from the Microsoft era is all the more evident in smaller to medium-sized businesses, which by their very nature, have had to be scrappy, turning to low-cost, easy-to-manage cloud services as an alternative to a traditional I.T. infrastructure. But the tide is turning. More enterprises are arriving at Box, which often represents their first or second toe dipped into the water of cloud computing. Maybe they use Salesforce, or some small cloud service on the side, but many are still Microsoft-based organizations running Exchange and Office.

Box then slides into place as a supplement to traditional systems like SharePoint then becomes the system of choice, leaving businesses to wonder why they still need the old system at all. In 2012, Box plans to help those folks cut the cord even more by implementing a new feature that will allow mobile users the ability to not only access, but also edit and comment on documents via the Box mobile app without needing another app supporting that file type installed on their mobile device. (For example, edit a spreadsheet on iOS with Apple’s Numbers app).

Self says Box’s move here is reflective of the move to more “cloud-augmented” apps, which he points out is already a big trend in consumer’s mobile computing behavior.

“These are apps where the bulk of the interesting work is happening in the cloud, not the mobile device at all,” he explains. For example, Apple’s Siri, where the voice recognition and processing work is happening in the cloud, and the iPhone is just recording what you say then playing back the results. Or Amazon’s Silk browser, which runs in the cloud, where only the UI (the presentation) is taking place on the mobile device. This too, mirrors Box’s plan for mobile: use HTML5 and web services for the business logic, while the UI/presentation layer renders through native code.

Combined with an increasing acceptance of using secure mobile apps (versus securing the whole mobile platform, e.g. RIM/BlackBerry Server solutions), it’s going to be easier than ever for enterprise customers to cut legacy connections altogether.

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Enterprise cloud file sharing company Accellion has raised $12 million in a new Series 3 round from private equity firm Riverwood Capital. The company will use the additional funding to accelerate growth, invest in enterprise mobile file sharing products, pursue partnerships and international expansion.

Founded in 1999, Accellion’s cloud-based solutions span public, private and hybrid cloud deployment, for secure, any device access to information while providing enterprise security and compliance. The company’s file-sharing solutions are available to users from the Web, iPhone, iPad, Android and BlackBerry devices.

CEO Yorgen Edholm says 2011 was a profitable year with record revenue – something he credits, in part, to the adoption of consumer-grade technologies in the enterprise.

“The adoption of iPads and the resultant use of unmanaged ‘dropbox-type’ applications are creating real security and compliance issues for organizations. Smart companies, proactively meeting the challenge and looking for a solution for secure, mobile access to enterprise content, are fueling our rapid growth.”

Riverwood Capital joins Baring Private Equity Partners Asia as key investors in Accellion.

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Editor’s note: This post was written by guest contributor Aaron Levie, CEO and co-founder of Box.net. You can read his previous posts here.

One of two things is going to happen in 2012: either the world is going to end as the Mayans predicted, or people are finally going to start to see enterprise software as cool (which I have long predicted).  Now, most people will never think enterprise software is as sweet as I do; I can live with that.  Services that help you access the world’s music or connect with your entire network of friends will always win the technology popularity contest.  But we do spend an awful lot of time talking about coupons, randomized video chat (likely NSFW), and virtual bars.  I mean, these are totally cool areas of innovation, but when compared to $3.4B software acquisitions and SaaS stocks up 60%, or over-performing IPOs and more rumored to come, I’m not sure the world of enterprise software is that lacking in spice.

And yet, mentioning that you work for an enterprise software company in causal conversation is an instant buzz kill.  Try picking up a girl with that opening.  Most people would rather talk about Angry Birds or even health care policies.  To be fair, enterprise software’s stigma is not entirely undeserved.  It’s not easy to love an industry where vendors often audit their own customers to claim revenue, product updates surface three times a decade, and solution lock-in is the standard.

But these characteristics are relics of the old guard of enterprise software. Almost everything about this category—from how software is built to who’s buying it—is undergoing massive change, and many longstanding assumptions no longer apply. So I figured I’d take a stab at debunking a few enterprise software myths to help explain why 2012 will usher in a very different era for enterprise solutions, making it the year of the enterprise software startup.

Myth #1: There’s no sizzle in enterprise software

If the consumer internet is technology’s Hollywood, as SnapLogic’s Gaurav Dhillon recently suggested, then enterprise software is its Waterworks.  Or its Yanni – profitable yet dull.  At least that’s how the category is perceived. Either the services are irrelevant to us individuals, or the problems being solved are relatively esoteric, like software that helps you get better performance from your servers (oops, that turned into a $40B business).  But the cloud takes the category mainstream, letting us all participate in this world of enterprise software, and meaningfully changing how we work and communicate.  We’ve seen an explosion of end-user-centric business solutions, finally making enterprise software relevant to all of us.

A film producer, Facebook co-founder, and early employee of Pixar all have started enterprise software companies to make that happen.  Not exactly the Mr. Watson crowd.  Enterprise software today is home to far more interesting rivalries than the battle for check-ins, or ‘likes’ vs. ‘+1s’.  For instance: who’s going to dominate the enterprise email wars as they move to the cloud?  A land grab for most other markets is quickly emerging, with ‘cloud’ spending broadly estimated to become $149 billion dollars by 2015.

Myth #2: There’s no scale in enterprise software companies

Enterprise software is still mistakenly seen as a category defined by niche markets, extremely long paths to reach customers, and wildly expensive sales cycles. Crossing the Chasm outlined the original progression of software adoption: first within smaller markets, followed by expansion to larger audiences.

But the shift to the cloud explodes this model, as software is now available instantly to nearly every business in the world. And getting to them is far easier than ever before.

On day one, cloud solutions are global, horizontal, and can support companies of all sizes.  Without having to aim a direct sales force at a particular segment, you can quickly analyze and optimize for areas where adoption is happening organically, instead of having to laboriously (or blindly) chase down customers.  And with 500 million+ information workers worldwide, the question is not “is there scale?” but rather “how do you get to scale, quickly?”  Freemium, open source, and viral enterprise applications are the new distribution models.  And some companies, like Atlassian and New Relic, are audaciously doing away with the traditional sales model altogether in pursuit of volume.

Myth #3: IT organizations are slow or difficult to work with

And then there’s the process by which new technology gets implemented and “blessed” within organizations.  Steve Jobs notoriously avoided selling to big businesses due to the small number of enterprise gatekeepers, otherwise known as CIOs. Their job is to care for and manage the security, integration, maintenance, deployment, management, and support of a wide range of technology. With careers on the line for every new piece of software introduced, their interest in carefully vetting (user translation: slowly adopting) solutions is more than justified.

But after spending the past few decades dealing with delayed roll-outs, over-budget projects, and unhappy users, IT departments have had enough.  This is why they are radically speeding up the implementation process, and cloud solutions and startups are benefiting disproportionally.  Major corporations like Procter and Gamble have created IT groups charged with piloting emerging technologies to solve problems that didn’t even exist (or simply couldn’t be solved) a few years ago.

Many of the Fortune 500 are embracing a “bring your own device” to work mentality and IT model, allowing individuals to choose their own hardware and software, greatly accelerating the adoption of cutting-edge technologies.  The implications of this change are profound, as it completely rejiggers the existing information technology architecture of most organizations—from security, to apps, to the content on these devices, few existing solutions adequately solve our future problems.  And that spells opportunity.  With IT buyers getting in front of this challenge and trend, the two scarcest resources you need from your customers—budget and motivation—are about to increase dramatically.

Myth #4: It’s impossible to compete with Microsoft and Oracle

The biggest hurdle to starting an enterprise software company, or securing the funding needed to start one, has long been the (once justified) fear that Microsoft, Oracle, or some other giant could easily prevent you from getting to scale.  As these players ‘controlled’ the underlying technology platforms and distribution channels, the expectation was that you’d be bought by them at best, and brutally crushed at worst.  Not the most favorable economic terms under which to launch a new company.

But in the cloud, customers have more choices than ever before.  And these choices aren’t easily influenced by the methods Microsoft and others have mastered.  When competing applications are just a few clicks away, undercutting competitors by delaying customers is no longer a meaningful strategy.  Oft-used marketing jujitsu (FUD) doesn’t work in a world of near-instant adoption and testing of applications.  And even applications with lengthier implementation cycles are finding today’s landscape to be far more favorable to emerging players.  Companies like Workday are increasingly taking share because a premium is being placed on their ability to out-execute traditional vendors.

Increasingly some of the world’s largest enterprises are going out of their way to find solutions not delivered from the big players, instead looking exclusively for solutions from unencumbered, independent startups.  They no longer want to instruct their traditional vendors about market directions, or deal with the conflicting interests of their providers (why doesn’t Microsoft build for Android and vice-versa).  Further, most enterprises are either over-served by existing solutions’ complexity, or underserved in the areas that are most important today: mobility, social, ease of use, speed, etc.  Using focus as a competitive weapon, startups can ensure that large incumbents simply can’t respond adequately to new customer demands and waves of technology.

Myth #5: You can’t innovate in the enterprise

A longstanding fear and reality with enterprise technology has been the undue influence wielded by customers when it comes to product roadmaps, with purchasing decisions made based on a vendor’s ability to win an RFP bakeoff.  But Chris Dixon reminds us that enterprise SaaS gives users greater influence over technology adoption, leading to products that are built to be used, not sold.

This shift has dramatic implications for enterprise innovation: building to drive real user and business value, not to produce a more appealing white paper.  Software like Yammer, Do, Asana, Zendesk, and GoodData are all user-introduced services, which means they’ll only see adoption if they’re solving real problems, consistently.  Unlike traditional enterprise “systems of record,” tools today get tossed out if their utility wanes.  With increased competitiveness, democratic platforms, and lower switching costs, the slope of the product innovation curve necessary to attract and retain customers has increased considerably.

2011 ushered in the early commercialization of social applications and platforms, big data, business intelligence, and new collaborative tools in the enterprise.  Gartner bets that 2012 will be about “the convergence of cloud, social, mobile and information into a unified set of forces shaping almost every IT-related decision.”  Industry jargon aside, these innovations, and their accompanying high-growth markets, will be dominated by enterprise software companies that didn’t exist a decade ago.

So when Robert Scoble says enterprise software isn’t sexy, he’s mostly right.  But this is changing rapidly. The category is shedding its slowness and stuffiness, and the new players that are emerging to define it look nothing like their predecessors.  2012 is going to be a renaissance year for enterprise software, and everything—including, most importantly, the way we work—will be transformed along with it.

Photo credit: h.koppelaney

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