The Write Stuff

Name: Geoffrey Moore

Title: Author, consultant

Web Info: www.chasmgroup.com

Claim to Fame: Author of “Crossing the Chasm”

Geoffrey Moore has a history of employing metaphors from the natural world to describe business challenges. His latest theme targets an elemental issue for many IT services companies: outsourcing.

The author of “Crossing the Chasm,” “Inside the Tornado” and “Living on the Fault Line,” believes corporate America needs to outsource its “context.” Or, off-load those functions that are not central to a companys essential mission and fail to provide any differentiation. In Moores view, a company might, for example, outsource accounting or parts of IT, while maintaining its “core.”

The trick is to determine what is context vs. core. Moore believes services firms could play a role in helping customers tell the difference.

“Whether youre a systems integrator or a service provider, theres a pretty widespread appetite [among CIOs] for thought leadership around what is core and context, and how you can build an infrastructure where you can outsource context and keep the core,” Moore explains.

As a consultant, Moore counts such service providers as Corio among his clients. “Theyre working very hard to help customers understand what is core and what is context,” he notes.

That exercise may prove pivotal for Corio and other emerging service providers whose livelihoods depend on the ability to sell customers on outsourcing or out-tasking. But there are other challenges, as well. Moore says service providers must address such issues as end-user control. “Theres a need for another generation or two of application software … giving the customer the kind of dial they need to control the [service-level agreement] as their requirements change,” Moore says. Another question, Moore contends, is how will companies track customer-complaint trends if they outsource their call centers?

“Until those issues are met at a better level the service-provider market is still going to struggle,” he says.

On the other hand, Moore believes service providers have largely overcome basic concerns regarding qualify, reliability and scalability. Services firms also have a financial impetus on their sides.

“The important thing is that financial markets wont let up the pressure on companies,” Moore says. “All the stuff you do that is the same that other companies do is not going to increase the stock price. There is a huge financial pressure to outsource.”

Infrastructure Opportunity

Moore, meanwhile, sees an opportunity for integrators in helping customers establish a common infrastructure. During the Internet boom, Moore says, Internet integrators such as Scient and Viant excelled at rapidly deploying apps on whatever plumbing happened to be available. The current environment, he says, calls for a more “sober” approach: the deployment of a standard reference architecture on which new applications can be built.

Moore says BEA and IBM have taken the lead in the architecture arena, noting that Hewlett-Packard, Microsoft, Oracle and Sun Microsystems also are contenders. Here, the task for integrators is to take the vendors architectural vision and make it happen for customers, according to Moore.

Overall, Moore remains convinced of information technologys potential, despite the market shakeout. But those pursuing opportunities will have to pick their spots.

“Probably the most fruitful source of competitive-advantage opportunity right now and in the future is in IT,” Moore argues. He adds this caveat: “The percentage of systems that have that capacity are relatively small.”

In Moores philosophy, its a matter of distinguishing core from context.