A few days ago I blogged about how the IEEE – the "world’s leading professional advancement of technology" is unable to convert a lowercase string to an uppercase one.

The Institute of Design at Stanford is the latest to shoot itself in the foot with the shotgun of irony. The d.school seems like a really great place. They "believe great innovators and leaders need to be great design thinkers". They "want the d.school to be a place for Stanford students and faculty in engineering, medicine, business, the humanities, and education to learn design thinking and work together to solve big problems in a human centered way." These are all things I believe in too.

So I try to sign up to their newsletter. I enter my e-mail address and I hit ‘join’. And here’s what I get:

Apparently my "data is about to be sent", but I can cancel if I want to. I do, and get this:

Grand visions are great, but easy. It’s the details that count, and they’re hard.

The other night I heard Rick Rashid, head of Microsoft Research worldwide, speak on the future of technology. His talk was so good that I’m going to try to persuade him to speak at Business of Software 2008 (only 24 hours until the early bird discount expires by the way, so book now).

A couple of the highlights of Rick’s talk were:

• His demonstration of Photosynth. This app takes thousands of photos of an object or a scene and then stitches them together to produce a three dimensional view that you can fly around and zoom in to. They can’t do it yet, but one day you’ll be able to upload your own photos and construct your own 3D model. You’ll also be able to take a photo of an object – the Seattle Space Needle, for example – and the software will recognise where you are and tell you more about what you’ve photographed. For now, there are a bunch of 3D scenes you can look at, including St Mark’s square in Venice and the space shuttle Endeavour.
• The World Wide Telescope. Microsoft have constructed a digital map of the sky from terabytes of data from the Hubble Space Telescope, the Sloan Digital Sky Survey and many other sources. You can use this virtual telescope to explore the heavens, panning and zooming thousands of light years away.

The best part, for me, was Rick’s answer to Hermann Hauser’s question about the future of the semantic web. Rick claimed little knowledge on the topic, but still managed to talk eloquently for several minutes. He said (I paraphrase, and any errors are mine) that the semantic web reminded him of research into natural language processing. For several decades, researchers have tried to work out ever-more complex grammars and rules to understand human language, but most researchers – the ones that are making progress anyway – have abandoned this avenue and are focussing on statistical, machine learning. This essentially involves dumping terabytes of data into complex algorithms and then using the results. Nobody understands the detailed internal connections that the models make, but the outputs seem promising.

Similarly, the semantic web relies on humans defining schemas for different objects. For example, Freebase has volunteers trawling Wikipedia’s unstructured data and structuring it, turning the free text of film stars’ biographies into structured tables of names, dates of birth and film titles [UPDATED: Freebase uses statistical methods as well as the community]. The problem with this approach is that the schemas, and the links between them, are man-made. Rick Rashid’s point is that we’ve just ended up with another set of bad data, but in a data structure. We may well find that computational, statistical models cope much better with understanding data than any fixed structure that a human can come up with.

Altogether it was an excellent talk: a strong mix of fantastic content and good presentation. Sign up to my RSS feed and I’ll let you know if I persuade Rick to speak in Boston.

I’ve been invited to speak on a panel of the future of IT this evening. In a moment of ego-driven weakness, and because I’ll get the chance to meet Rick Rashid, Head of Microsoft Research worldwide, I accepted. It’s not a topic I feel qualified to pontificate on, so I’ve spent the past few days booking up. Hopefully I won’t make a total tit of myself.

I feel like the British ambassador in a far-away country. The story goes that a journalist called him up one December and asked him what he’d like for Christmas. A memo had gone round the week before, reminding all staff about the dangers of bribery. The guidelines, it emphasised, were to not accept anything worth more than $50, or that couldn’t be consumed in a single sitting. With the rules in mind, he told the journalist that he wouldn’t mind a small box of Turkish Delight. Not too large, mind.

The next week, he opened the newspaper. It described what the ambassadors of different countries were hoping for at Christmas. The French ambassador hoped for world peace. The US ambassador wanted a cure for cancer. The German ambassador wanted an end to poverty. And the British ambassador wanted a small box of Turkish delight.

Over the past few days I’ve read about printed polymer displays. I’ve looked into the implications of unlimited storage, and cheap, multi-touch screens. I’ve Googled Doug Engelbart and Ted Nelson. I’ve skimmed books by Alvin Toffler and John Naisbitt. I’ve watched a 3-D teleconference that Cisco held last year. Will in-car internet be the next big thing? How will programming languages change to cope with massively distributed systems? Are data-flow languages the way we’re heading? What about quantum cryptography? Are the social trends more important than the technology? Are we just obsessed by techno-fetishism?

And then, this morning, I try to join the IEEE. I enter my chosen user name, and click next. I get the following screen:

Apparently the IEEE – the self-named "world’s leading professional association for the advancement of technology" – cannot figure out how to convert a lowercase string to an uppercase one, and they think that error SBL-EXL-00151 is a sensible way to tell me their problem.

Then I log on to my internet banking system. I want to see the transactions in the last month. Of course, there’s no option to view the last month, so I enter dates from 3/5/08 to 3/6/08 (I’m in the UK). I get the following error:

Error(s) occurred

The ‘from’ date entered is invalid. (B1010-BR)

Not only can HSBC not convert my input of 3/5/08 to their expected input 03/05/2008, but they can’t even figure out that this is one ‘error’ and not multiple ‘errors’. And they insult me by claiming it’s my ‘error’ when it’s clearly their sloppy programming. But, hey, that B1010-BR number is really useful.

There’s an element of grumpiness in my griping, but there is a serious point here too. Innovation isn’t always – or evenly mainly – about the whizz-bang of nanobots and artificial intelligence. To take an idea from the lab and turn it into a usable product that people will buy can take years – if not decades – of hard, sustained effort. The multi-touch displays we’re drooling over now were first demonstrated twenty years ago. The mouse is 40 years old. Electronic paper was demonstrated at Xeroc PARC in the 1970s. The people who grind away at the job of turning ideas into products are not the same people who have the startling insights, or who tell us fantastic stories about the future of machine vision or the semantic web. They’re the journeyman software developers who still cannot figure out how to remove the spaces and dashes in credit card numbers.

So here’s my Turkish delight; what I’d like the future of IT to be. I’d like us to improve the craft of software development. To stop producing unusable, patronizing software, and to start writing well-tested, well-designed software that makes people smile.

But I reckon that’s a lot less likely to come true than machine vision, nanobots and free, wireless Internet access.

I started using my new toy yesterday. The iRex iLiad is an eBook reader. What makes it special is its use of electronic ink. It’s a reflective display: the screen behaves much like a slightly grey printout from a medium quality laser printer. It’s easy on the eye, high resolution, and you can read it outdoors.

Here’s the eBook version of Sebastian Faulk’s Devil May Care with the hardback on one side and my laptop on the other. Click the image to view it full size. Note the glare from the flash on the laptop’s screen, and its absence on the iLiad.

Here it is again, next to the hardback:

The reader is about the same height and width as a hardback book, but shallower and lighter. Turning a page takes a second or two, but not much longer than turning the page of a real book.

Overall, it’s a fantastic bit of technology. From using it for a day, I’ve drawn the following conclusions:

1) Electronic ink is the next big thing. In the next few years everybody’s going to be using a device like the iLiad

2) But they won’t be using the iRex iLiad

It also illustrates an important point:

3) It’s not hard core technology that counts. Technology can be important, even essential, but it’s the other stuff that’s important.

Let me explain.

eBooks are tomorrow’s big thing. And always will be. After a decade of hype that was the conclusion I’d reached, but when Bill Buxton showed me his iLiad a few months ago I knew I was wrong. The technology is not round the corner: it is here right now. You can go to Borders, or log on to Amazon, and buy an electronic book that is smaller, more convenient and with more capacity  than a traditional book. When I travelled to Boston last year I took the following: a bunch of academic papers about branding, a copy of the Harvard Business Review, The Tipping Point, Slaughterhouse Five and the Golden Compass. By weight, it was about half of my luggage. Next year, when I return, I’ll be carrying twice as many books in a device the weight of small paperback. Within the next few months we’ll have flexible displays too. Forget circuit boards: the electronics will be printed onto polymer sheets using ink-jet printers. Plastic Logic’s factory is being built and will be producing displays this year. By April next year, you’ll be able to buy a flexible, wireless display that you can roll up and carry around in your pocket, probably for well under $100.

Technically, electronic ink is awesome. Creating a reflective, electronic, paper-like display was an enormously difficult problem that has taken decades to crack. Printing electronics onto plastics is an equally hard problem.

But so what?

We don’t buy products because of the clever technology in them, or because they’ve taken decades to reach fruition. We buy products to solve our problems. You won’t buy an eBook reader because the display contains millions of tiny two-tone charged nanoparticles. You’ll buy it because it you’re running out of shelf space at home, or because you don’t want to lug hardback books around on holiday, or because you want to be able to read today’s edition of the Guardian from Kinshasha.

The iRex iLiad is 99% of the way there. They (or rather E Ink Corporation, who manufacture the display component) have done all the hard work. But they’ve neglected the 1% that’s important:

1) The software sucks. If it’s going to compete with a physical book, it’s got to be easy to use. As easy as a book, in fact. But there are too many niggles. The interface is full of icons that are non-intuitive and impossible to discover. The iLiad has wireless networking, but you can’t download books from the Internet. You need to download them to your computer and then transfer them across. You can’t search through eBooks. It has a pen so you can write notes on blank sheets, but you can’t annotate books.

2) The device is too expensive. At $900 this simply isn’t mass market enough. Of course, the technology will rapidly come down in price, but iRex could have subsidised the cost of device through book sales, much like the games console manufacturers do.

3) The content is too expensive. A hardback copy of The Devil May Care costs $14, little of which is profit. The electronic copy costs $17.95, all gravy. Somebody is being greedy.

4) There’s not enough content. People want the content, not the medium.

Sure, all of these problems are hard to solve. But they’re not as hard to solve as figuring out how to build a paper-like electronic display. They are design problems (creating a good interface), commercial problems (reducing the cost of the device) and licensing problems (persuading publishers to make their content available digitally).

Nobody has cracked all of those problems yet. But somebody will. Somebody will produce a device that looks so good that it appeals beyond geeks and that’s as easy to use as a physical book. They’ll persuade publishers to make their content digital, and they’ll work out a commercial business model. Who will do it? My money is on Apple or Amazon.

Take a look at other successful products and companies and you find other examples about how it’s not the technology that matters. It’s the other stuff. Google succeeded not because of their search technology but because, with adwords, they figured out how to make money from search. Microsoft succeeded, initially, not because they had a better operating system, but because they cut a licensing deal with IBM. The Nintendo Wii is a success not just because of the clever accelerometers built into every controller, but because they made a conscious, commercial, decision to target consumers who weren’t hardcore gamers. The iPod succeeded not because of its small hard drives, or its thumb wheel, but because of the way it lets consumers download cheap, legal music of their choice to their MP3 players. Digg is successful not because of a technical innovation, but because of an incremental social innovation – letting people choose the stories they like.

After only a day, I’m hooked on my iLiad. It’s 99% fantastic. But I’ll ditch it the minute somebody looks beyond the narrow technical problem and finishes off that extra 1%.

If you’re a geek, you’ve probably got your head buried in technology. Lift it up out of the sand and look around you. If you’re going to succeed – if you’re going to be Apple and not iRex – then you need to spend less time on the technology and focus on the other stuff.

Red Gate is running a competition to find exceptional SQL Server DBAs. Enter and you could win a ticket to SQL Pass in Seattle later on this year, plus accommodation, money towards travel expenses, free software and a lot of kudos.

As Claire says, "… DBAs are unsung heroes within the IT community and their companies. This award will shine a spotlight on the achievements of SQL Server
DBAs."

Find out more at www.exceptionaldba.com

If you want to come to Business of Software 2008 and get the special early bird price of only $1,395 then you need to book before June 7th.

Joel Spolsky, Seth Godin, Jason Fried and Eric Sink are all speaking, plus some other excellent speakers. You can find out more, and book at the conference web site.

Last year, 94% of attendees gave it four or five stars. Joel Spolsky called it "the best conference I went to last year". In fact, he liked it so much he’s put his name on this year’s: Business of Software 2008 is a Joel on Software Conference.

Here are some quotes from last year’s attendees:

Amazing conference. It will be tough to beat. Chris Kemp, I Love Rewards Inc.

Excellent content! Good food for thought! Matt Ruma, President, Creative Logic

Great variety of topics. There were many moments where I felt
validated or was shown our company’s flaws. I’m not a developer but it
was the right level of ‘technical’! Anon

Day one alone was worth the price of admission – great work on getting great speakers. Austin Salonen, Lead Developer, SGS Mid-West Seed Services

Very diverse, great speakers. Great variety, great logistics. Thanks! Felix Trepanier , Technical Lead, OZ Communications

Excellent speakers.  It’s what I came for and it’s what I got. Anon

Excellent overall. Great speakers, great content. Ton of opportunities to network. Scott Lawrence, Software Development Manager, APS Healthcare Inc

The combination of small, intimate size and a diverse
list of speakers made this the most valuable and provoking conference
I’ve been to in a long time. It’s a significant achievement that from
every speaker I’ve come away with either something quite profound to
consider or something concrete to do. Rob Muir, Development Manager,FINCAD

I’m glad this type of conference is finally taking place. Thanks for your efforts. Jennifer Desha, Project Manager, Numira Biosciences

Best conference! Mark Belliveau, VP Marketing, Normsoft Inc

Some really excellent speakers. Liked the mix. Anon

Thanks! Great conference Joe Crevino, Development Supervisor, LAN International

I feel like I’m a lot more prepared to do my job
after being here and will be more successful in the future as well.
Thanks a lot! Anon

Great job on the conference! The site and accommodation were excellent. An amazing experience! Bryan Dykstra, Director of Business Development, Creative Logic

If you’re coming to BoS 2008 in Boston this fall, or are generally interested in the Business of Software, then I’ve set up a Facebook group and a LinkedIn group.

This 15 second clip is from CSI NY. Laila sent me the link from John Papa’s blog:

Lorenzo Bolognini has just released a bug tracker with a twist. You use it to raise and track bugs in your country. For now, you can only track bugs in Italy. Let’s hope he’s load tested the system. According to Lorenzo, here are the top 5 bugs in Italy:

5. Scientific research in Italy – Italian researchers go abroad. In Italy the system of scientific corporations, the difficulties in getting finance, the miserable salaries of researchers, push many people abroad.

4. The rubbish collection in Naples – Naples is covered with garbage. Solutions are dimly perceptible, but late in arriving. The problem began in June 2006, almost 2 years ago.

3. Temporary work contracts – the temporary nature of work, for young people and others, is in front of everybody’s eyes. And, despite the seriousness of the problem, nobody seems to grasp it (at least not in election time).

2. There is no web site dedicates to promoting tourism – Italy, after the closure of the costly Italia.it, doesn’t have a web site to promote tourism at the level of other European countries.

1. We have built Italy, now we must build the Italian people. Everybody knows this phrase by Massimo D’Azeglio at the birth of Italy. The question remains open, but my personal judgement …

Read more at the buggato web site.

What would your country’s top 5 bugs be? Post here …

A couple of weeks ago I kicked off a Seth Godin photo competition. There were a lot of excellent entries. Forced to choose a winner, I’m going with s3a’s entry of I said bring me a Sith, with an I!

Here it is (click on the image to enlarge it):

The other entries were awesome too. Weird, too. If you want see Seth being chased by a tiger (Run, Seth, Run!), dancing with Albert Einstein, posing as Lenin or being beaten up by a teddy bear then go to the original blog post.

I was going to award a single prize, but to say thank you for all the entries I’m going to send everybody who entered a Seth Godin book of their choice. Just e-mail me your postal address and which book you’d like and I’ll send it out to you. I’ll think of a special prize for s3a too.

If you want to come to Business of Software 2008 (and hear Seth Godin, Joel Spolsky, Eric Sink and many others) then you can now pay by American Express as well as Mastercard, Visa, etc.

You can book at the conference web site.

Book before June 7th and get the special price of $1,395 (you save $400).

A few months ago we bit the bullet and decided to re-write ANTS Profiler, Red Gate’s .net code profiling application. ANTS Profiler 3 was good, but AP4 is going to be remarkable. It’s faster (between 5 and 30 times, depending on what you’re doing); easier to use (we interviewed and videoed tens of users, and gathered data from hundreds, if not thousands, while designing AP4); and has a great timeline feature (you can highlight areas of high cpu and just see the code that was executed in those time slots).

We’ve now got a public build available. It’s still a very early version but there’s enough there for it to be useful. We’re going to be releasing weekly builds from now on, so keep an eye out.

If you’re writing .net code and want to find bottlenecks in your application, then either read Bart’s post for some more information, or go straight to the messageboards to download the early build of ANTS Profiler 4.

Last week I kicked off a Seth Godin action figure photo competition. I’ll keep it open for a few more days and announce the winner early next week. It’s not too late to enter.

The entries are so good I think I may well have to hand out several prizes. The weirdest photo category will be particularly hard fought.

So far Jim Kring, Tom Randle, Mr Flibble, embe and s3a have all submitted photos.

If you want to see Seth being attacked by a teddy bear, upside down in a glass of cider, posing as Lenin, reading his little book of marketing secrets or tied up as Darth Vader’s prisoner then check out the photos on the original competion post.

I heard this interview with Michael Moritz, the Sequoia Capital venture capitalist, on Radio 4 the other day. It’s well worth 30 minutes of your time. Moritz talks about his journey from childhood in Wales, history degree at Oxford, journalist for Time magazine and on to Sequoia where he has invested in, among other companies, Google, Apple, Yahoo!, PayPal and Cisco.

Here’s an excerpt (apologies for the ropey and inaccurate transcript):

Peter Day: Many investors throw their money at lots of investment targets, hope that two or three will be survivors and that one will be a superstar success.

Michael Moritz: That isn’t how things are done at Sequoia. It’s not the way you think of it. Every single time you write a cheque you expect, or pray, depending on your inclination, for that investment to succeed.

You can hear the interview as .ram streaming audio, or a downloadable mp3 (note the interview doesn’t start until about a minute in). The Radio 4 web page is here.

I learned some time ago – and this has been reinforced many times since – that my sense of humour is not a good guide to marketing decisions. Luckily, other people at Red Gate quickly overrule me any time I try to get involved in marketing. That’s why, if you visit Red Gate’s stand at Tech Ed this June, you’ll get a funky Red Gate t-shirt rather than a cool pair of Red Gate underpants.

Occasionally, and regrettably, I get my own way though. And that’s almost always a mistake. That’s why I sent out 140 Seth Godin dolls out to last year’s attendees of Business of Software 2007. Seth is speaking at Business of Software 2008, and I thought this would be a really cool way of getting people who came last year to sign up to this year’s conference.

They seem to have sunk without trace.

Or have they? I want to find out. I’m running a photo competition. If you have a Seth Godin doll (from me, or maybe you have one anyway) then e-mail a photo of your Seth doll to me at ne***********@bu****************.org, and I’ll post it up.  The more interesting the better. Assuming that anybody enters (a big assumption), I’ll send out a copy of one of Seth’s books to what I judge to be the best photo.

[Update: you can’t post images in typepad comments so you’ll need to e-mail me the photo and I’ll post it up]

The entries

Jim Kring:

My entries:

Here is Tom Randle’s entry:

You can see another of Tom’s Seth Godin photos, and read the story behind this one, at Tommy Toast’s flickr stream.

Mr Flibble’s entry:

Mr Flibble’s flickr stream is well worth a look too.

These three are from embe:

This one from s3a is called I said bring me a Sith, with an i!

You can find a larger version at s3a’s flickr stream.

Mr Flibble saw s3a’s entry and was inspired to send in two more entries:

Another one from s3a:

Sheri’s entry:

I’ve just learned that Embarcadero are planning on buying CodeGear, the Borland division that’s responsible for their developer tools (but not the more enterprisey application lifecycle management stuff). They’re paying $23m.

Embarcadero currently have revenues of $60m but expect the merged companies to have revenues of $100m. So they’re buying annual revenues of $40 for $23m. That’s an interesting multiple.

Earlier this month, Thoma Cressey Bravo, the private equity firm that owns Embarcadero, agreed to buy InstallShield and FlexNet from Macrovision for $200m and form a new company called Acresso. Given Thoma Cressey Bravo’s stated aim of ‘creating value through the strategic use of acquisitions to accelerate business growth’ I wouldn’t be surprised if Acresso buys Embarcadero, or vice versa, some time soon.

It’s a business model that I find a bit fishy. If I thought that Thoma Cressey Bravo’s plan was to heave CodeGear back to greatness then I’d think differently. But I suspect that they’re more interested in the quick buck. They’re taking slightly shabby, flabby companies that are stumbling into decline and gluing them together, hoping they’ll stick long enough for a 12-month increase in sales followed by a re-float or trade sale and an enormous profit. It’s like taking an apple, an orange and a banana, banging them together and calling it a fruit salad.

What do you think of the acquisition? What does it mean for CodeGear? Post here …

[Disclosure: Embarcadero are theoretically a
competitor of Red Gate, but our paths don’t cross much]

When I was 12 years old, Mr Pretorius, my sadistic, South African high jump teacher, favoured a triangular, metal high jump bar over the usual fibreglass pole or bamboo stick. He would have wrapped it in barbed wire if he could: his theory was that failure should be painful but rare. The more that failure hurt, the less likely it became. My fear of knocking the bar off and landing back-first on its skin-scraping metal corners would spur me on to jump ever-increasing heights. Of course, since it was physical ability rather than mental toughness that held me back, the only thing it spurred me to do was to give up high jump classes as soon as possible.

Although Mr Pretorius was wrong, there is a kernel of an interesting idea here. In many cases it’s not our lack of ability that stops us succeeding. We fail because we don’t bother getting started; or once we start we don’t stick at it; or we don’t really want to succeed; or playing just one more game of Mario Kart is more appealing than knuckling down and solving that knotty problem.

People often say they fear failure, but it’s not failure they fear but failing in public. Failing in private, when nobody finds out, is easy: making a total tit of yourself in front of strangers or – even worse – people you respect is scary. It’s something most of us will do almost anything to avoid.

We can take this fear of failure and flip it round so it becomes a powerful motivator. Here’s my suggestion: to succeed, put yourself in a position where failure is publicly embarrassing.

On the Joel on Software forums, people often post asking if they should start their Micro ISV, or they’re earning some money and should they go full time. I say just go for it. But don’t tip-toe half-heartedly into it, telling nobody and keeping the safety net of the day job. That’s not going to help you succeed. Jump into it head-first, shouting and screaming; tell the world what you’re going to do.If you fail, people will point at you and mock you, snigger at your misguided audacity and say they always knew it was never going to work. You don’t want that, so you’re more likely to succeed.

Here’s an example I’ve used before. At last year’s Business of Software conference there was a point when it wasn’t looking good. I only had 30 attendees signed up. I – and people I trusted – were questioning its viability. The least risky option would have been to quietly back down and cancel. But I decided to go ahead, knowing that there was a reasonable chance that the conference would flop and that I’d embarrass myself. That was the psychological turning point: it was the moment that I made an absolute commitment to running the conference, no matter what the consequences, or how foolish I’d end up looking. It was also the moment that things started to pick up, and I don’t think that was a coincidence.

If you’re feeling really brave you can artificially raise the stakes. Make a stupid, public bet, for example. Want to leave your day job but aren’t sure that you’ll succeed? Tell people that you’re going to run through the streets of New York in a gorilla suit if you haven’t given up work and made your first sale by this time next month. That should be a powerful motivator. Let me know how it goes.

So go on: be bold, and risk making a tit of yourself.

Today’s guest post is from Dan Nunan. Dan is Chief Marketing Officer at Red Gate, an advisor to several UK government bodies on marketing and a visiting lecturer at Cranfield university. He also spoke at Business of Software 2007. This is a re-post: unfortunately I had to pull the original.

Did you hear the one about the French guy who bet $73billion on the stock market and lost? You have? Of course. Financial doom and gloom has, primaries aside, been front page news for weeks. The general consensus is that a recession is inevitable in North America, and very likely in Europe. So let us assume that the economic pundits break a habit of a lifetime, and actually get this one right. What might it mean for folks in the software business? Here are five things to think about.

1. Overall, recessions aren’t good news
Let’s start by being pessimistic, and look at what happened to the software business in previous downturns. In 2000/2001 firms that got into trouble lacked a viable business model, weren’t able to generate cash, and relied on too much external funding. In short, the sort of things that will drive businesses to the wall even in good economic times. So, let’s go back to the last ‘proper’ recession in the early 1990’s. The software business was much smaller then, but in his book ‘The Business of Software’ Michael Cusumano describes at length how in the early 1990’s recession companies reliant on product revenue were harder hit than those who had substantial services revenue, such as renewals on support contracts or consultancy agreements.

The bulk of software spend comes from business rather than consumer markets, and Gartner is already advising CIOs to have a plan ready for making cuts in 2008. But the CTO/CIO can only cut what s/he knows about. So if you sell at the enterprise level, and require senior management sign-off, then expect a harder sell and longer sales cycles over the next year. If your sales are ‘under the radar’, such as on corporate credit cards, then things might not be so bad. However, companies are increasingly aware of their expenses bills. Management consultants will point to personal expenses as an easy target for cuts, as it has the smallest impact on customers or staff.  It’s expenses like 1st class flights, not to mention the all-important team building events in luxury hotels, that the bean counters are after but software purchases will inevitably be caught in the crossfire.

2. Get some perspective
When economic pundits talk about recessions they are talking about a whole economy. Unless you are responsible for a whole economy – and I’m guessing you aren’t – then you should be more interested in your own business. Say the economy shrinks by 3%. This would be bad, although hardly Armageddon. Does that mean that your business will shrink by 3%? No. The macro economic climate is just one of the factors that decide how well your business does, and it’s probably not even the most important factor. If you write software, the provision, or lack of, high quality snacks and caffeinated beverages for developers will probably have more than a 3% impact on the bottom line. Great software, produced for the right market is still going to count for a lot. Looking at the current forecasts from big software firms, a software recession might just mean that things don’t grow as quickly as they have done over the last few years.

3. Don’t panic
Douglas Adams was right. If you walk around the office constantly reminding people of how bad the economy is and how uncertain their jobs are, don’t be surprised if your best people start to have other ideas. The last time a recession loomed in the US applications for business schools went up 70%. Talk about ‘battening down the hatches’ and even the best employees are going to start revisiting those alternative career plans that sit at the back of everyone’s mind. Whether it’s doing an MBA, setting up a Web 2.0 organic chicken farm, or fulfilling that life long dream of starting a brewery, good people always have options. So stay focused on your business.

4. Less is more
Research shows that in smaller companies innovation is more likely to happen in an environment of limited resources. As companies grow, inefficiency creeps in. It becomes about “what’s the easiest way to spend” rather than “how do we get the most out of this money”. As more technical employees become available, miraculously the number of resources required for projects goes up. Marketing starts talking about superbowl ads, and you notice a drastic reduction in the golf handicap of your best salespeople. Having to make do with more limited resources means that your people are more likely to find those innovative solutions to problems that require persuasion rather than just checkbooks.

5. Think ahead
Conventional wisdom says that a recession is a terrible time for business, but economic downturns don’t last forever. But, assuming you are in the right market, a recession is a great time to grow market share. Some of the most successful businesses ignored the news and kept investing through a recession, whilst their competitors were busy scaling back. If you have a strong balance sheet, and your competitors are short of funding, then they are likely to become increasingly short-term in their outlook. It’s also a great time to think about opportunities and attack the new markets that your competitors are scared of.  Build a reputation as a company that’s ambitious and growing and you’ll find also find that recessions are a great time to hire.

Meanwhile, make the most of the $1 coffee at Starbucks whilst it lasts…

Here’s a quick update on Business of Software 2008. In case you weren’t aware, Joel Spolsky and I are running this conference in Boston, September 3rd – 4th. We’ve got some great speakers lined up including Seth Godin, Eric Sink, Jason Fried and Joel himself. You can find out more at www.businessofsoftware.org.

Since I last blogged about the conference, I’ve signed up one more speaker. Tom Jennings is a Managing Director at Summit Partners. It’s odd how we’ve all got a lazy stereotype of the venture capitalist as the sharp-suited, good-haired, smooth-talking, count-your-fingers-after-shaking-hands, wheeler-dealer vulture out to shaft the entrepreneur and make a quick buck, yet I’ve never actually met any who fit that description (although, without fail, they do have great hair). All the venture capitalists I’ve met have been urbane, smart, articulate, thoughtful people doing their best to help entrepreneurs build successful businesses. It’s not a route I agree with, but I understand why people take it. That’s why I’ve asked Tom to speak on "Why everything you’ve ever heard about venture capital is wrong". It’ll be a good talk.

In case you’ve missed it, we’re running a Pecha Kucha competition. If you want the chance to present 20 slides in 6 minutes 40 seconds, a rigorous and hopefully vigorous 20 seconds per slide, or even just find out what Pecha Kucha is then visit www.businessofsoftware.org/pechakucha.asp

Registrations are going well. The early signs are that we’re going to fill the 392 seat auditorium that we’ve got available to us, so if you want to book then don’t hang about. So far, we’ve got people from some 20 US states, from Alaska to Florida, and eight countries (Australia, Poland, Ireland, USA, Canada, Belgium, Sweden and the UK). It’ll be a good, international mix of people with plenty in common but enough to set them apart for things to be interesting. Judging by people’s job titles the attendees include software developers, CTOs, founders, CEOs, consultants, VPs and product managers so that’s good too.

I’ve got a couple more speakers I’d like to invite, so if you want to keep up to date then use the link below to subscribe to the RSS feed.

See you in Boston!

Elmore Leonard once wrote that the key to great writing is to leave out the boring bits that people skip.

Hemingway wrote that "The first draft of anything is shit."

Robert McKee: "No one has to see your failures unless you add vanity to folly and exhibit them."

Hawthorne: "Easy reading is damn hard writing."

I think there are obvious parallels in software development, which I won’t spell out. Leonard also said never to start a book with a description of the weather. If I could shoe-horn that into a software development analogy then I would.