By Charles King, Pund-IT, Inc. February 1, 2017
It’s no surprise that vendors are systematically targeting workers who leverage their own personal technologies for company projects and functions. That practice has been commonplace since the 1980s when employees first began sneaking home PCs into their offices to run spreadsheet and word processing programs. On the plus side, those efforts can increase flexibility and efficiency but they also circumvent established IT and, increasingly, traditional IT vendors.
More recently, vendors, like Amazon with its AWS solutions, recognized that proactively engaging individuals and work groups, and thus entering their workplaces through the “side door” constituted a highly effective business model. Many others have followed or tried to follow Amazon’s lead, especially software as a service (SaaS) vendors and others leveraging cloud computing infrastructures.
Those that succeed eventually reach an interesting position where pursuing or achieving upward growth requires them to prove their solutions are worthy of broader adoption within the enterprises they initially entered informally. This can result in a fascinating dance, technologically and rhetorically as proved by this week’s Dropbox announcement of new cloud, workspace and collaboration services and solutions.
The latest from Dropbox
What did the company discuss at its San Francisco launch event? I’ll italicize the high points summarized by Drew Houston, its co-founder and CEO: “We’re redesigning Dropbox to be fundamentally designed for teams. We’re reinventing sync, bringing a modern collaboration experience to all your files, and launching Paper, a new way to work together that goes beyond the document. And we’re building this all on top of a strong business foundation.”
Coming a few months before the company’s ten-year anniversary, these points suggest a fundamental refocusing in a company whose strategy has largely targeted individual customers. The teams and collaboration references underscore a strategic shift toward the communications/workflow needs of larger organizations, as does Paper providing Dropbox customers a new way to work together.
These points, along with the references to files and documents, also signal the company’s competitive intentions. In essence, Dropbox is targeting the complex collaboration and file sharing processes supported by solutions, including Microsoft SharePoint, Citrix GoTo and Google Apps for Work, as well as web-enabled productivity suites, like Microsoft Office 365 and Google Docs. In addition, it will continue to go after web-based communication/collaboration services, such as Slack and Atlassian’s Confluence and HipChat that are popular among younger workers who are often also Dropbox users.
This reveals a remarkable level of ambition in the company’s leadership, but the key to the attractiveness and applicability of Dropbox’s new offerings within enterprises is the last point – the strong business foundation it claims to deliver. This is a critical, practical point. Enterprises are exceedingly picky about the solutions they invest in and employ, requiring solution vendors to have an intimate, demonstrable understanding of the business processes they claim to be able to support.
As many vendors with enterprise aspirations have learned, often painfully, enterprise readiness is not an entirely objective form of measure. It typically requires working for years or decades in the trenches with enterprise IT, learning the requirements of individual organizations and larger industries. Simply boasting about one’s enterprise readiness does not make it so and, in fact, can increase the potential damages inflicted from faltering or failing to back-up your claims.
Dropbox’s decision to pursue enterprise customers is no surprise, and neither is interest among the competition. In fact, the day after the company’s launch event, Slack announced a new Enterprise Grid communications solution for larger customers. But Dropbox appears to be particularly well-positioned to pursue, capture and achieve its lofty enterprise goals.
As noted at the launch event, the company has tens of millions of users in more than 200 countries, including over 200,000 paying teams that are currently using Dropbox solutions inside their companies. Moreover, it is one of only five SaaS companies that have achieved a $1B annual run rate, and hit that milestone faster than any other company.
In other words, Dropbox’s claims that its new solutions and services will transform collaboration and content-based processes to the betterment of enterprise customers should not be considered an idle boast. Instead, the company has proved that it has the skills, vision and talent to establish a strong presence in one of technology’s most competitive and demanding markets. What Dropbox plans and does next should intrigue its existing and potential business customers, and be viewed closely by competitors.
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