As you may have heard, last week we were named to the 2014 CNBC Disruptor 50 list. What an honor! To be recognized among such an elite group of companies is an accomplishment on its own. We’re thrilled that the hard work of everyone at Apptio has been recognized, for the impact we’re having on the enterprise. I’m not here to discuss the semantics of the word “disruptor,” but I would like to share what it means to us here at Apptio.
According to CNBC’s methodology, the two most important criteria in determining how disruptive a startup is to established companies or industries are: “Creating a new market or ecosystem” and originality. This cuts at the heart of Apptio’s success. Technology Business Management (TBM) as a software category did not exist before Apptio. There was no common standard operating model to run IT. Every IT leader had to invent their own operating model for IT (including services taxonomy, data models, cost views, KPI’s, Plan/Build/Run, benchmarking etc.). Today, the most innovative CIOs and IT leaders in the word have chosen Apptio because of the value our SaaS cost transparency and analytics applications bring to their organizations.
As I’ve discussed before, Apptio was founded to solve a chronic problem that CIOs were facing on a daily basis. In the beginning, even I had a hard time believing that a business management system for IT did not already exist. This was no different than what happened in the CRM and ERP spaces, these functions ran on spreadsheets which were brittle and hard to manage - IT was no different. Certainly, industry giants were offering a slice of these capabilities but it was clear that no one had created a purpose-built solution for managing business analytics for IT. From that moment on, we’ve worked tirelessly to build world-class applications that make the job of a CIO easier.
This is the key to our success. For Apptio, disruption lies in execution. By listening to our customers and understanding how they manage their IT organizations today, it’s our goal to create next-generation SaaS applications to automate cost transparency. Disruption requires displacing the norm. In IT, this means shifting from the old paradigm (few vendors, CapEx spend, CIO’s speaking the language of tech, and IT owned infrastructure and applications) to the new paradigm (multiple vendors, CapEx and OpEx spend, CIOs speaking in the language of the business and directly sourcing technology services from cloud providers, hybrid infrastructure and applications – on premises, cloud, outsourced).
We’ve had the privilege of working with more than one-third of the Fortune 100 because our applications solve the hard problems IT leaders are facing in an elegant way. Apptio helps CIOs bridge the trust gap between IT, finance, and the business unit so the company can make faster, data-driven decisions about their technology investments. The conversations between CIOs, CFOs, and the business units about technology historically required an interpreter. Providing insights and bridging those conversations about cost, quality and value of technology is how Apptio has innovated and disrupted the market.
Part of Apptio’s success lies in our ability to displace outdated and time-intensive methods for IT cost management. The insights we provide can lead to the elimination of tech debt through shared services and data center consolidation, shifting from a product to services orientation, application rationalization, and so on. Typically, this means dismantling and replacing established methods and technology, but it’s this disruption that leads to innovation for our customers.
To be clear, it’s no easy task. Disruption is hard. To change the way people do their jobs or the way companies operate isn’t an overnight success. Disruption requires a team dedicated to the vision, the tenacity to work through the challenges and the patience and determination to help others through the journey. It often feels like pushing a large, heavy rock up a steep hill – that’s disruption. Yet, despite the internal struggle, it’s worth it because what we are doing matters to businesses and has a significant, transformative impact on our customers. To this day, it’s the customer success stories we hear that keeps us going and gives us the momentum we need to keep pushing that rock.
Lessons from a disruptor
Along the way, we’ve made our fair share of mistakes. We’ve learned, the hard way at times, what it takes to bring a new idea to a new market. As we enjoy our current status as a disruptor, we are happy to share some of the lessons we learned along the way.
- Pick a big problem. Don’t shy away from the tough issues - they will have the biggest impact on business. To tackle a big problem, learn all you can from your prospective customers, build a team of experts in the industry and then get to work on the ideal ways to solve it.
- Never forget your customer. Apptio’s mission is to develop wildly successful customers. We can only do that if we stay focused on innovating in areas that solve real customer issues, not innovation for innovation’s sake. Hold yourself and your team accountable against this.
- Be visionaries. Learn customers pain points and give them what they need, not necessarily what they want. For Apptio, customers expressed frustration around the process and management of IT spend, but we recognized the bigger issue was around how little the business trusts and values IT and CIOs because of IT costs. We started Apptio to solve that problem and it continues to fuel the development of our applications.
- Make friends. Bring on as many allies, advocates and partners as possible. If you are disrupting a market, you will need to do a lot of educating. To drive education broadly and to do so quickly, you can never have too many evangelists. Because we created a new category, TBM, we needed to do a lot of education and worked with the CIO community and partners to make it a reality.
The recognition from CNBC is a positive indication of our impact on businesses and CIOs. However, it doesn’t mean we’ve reached the peak of our journey. The disconnect between IT and the business is a big one that affects thousands of companies, and we’re not done solving it yet. We’re going to continue doing this disruptive work and bring Apptio to more companies around the world.
Is your company a disruptor? What other strategies do you think are critical for success?