Thinking outside the box

Picture this - a man walks into a department store to buy pencils and the guy at the sales counter, seconds after swiping the customer's credit card, says, “Sir, would you want to buy a new t-shirt for your two-year-old daughter? Her birthday is next month and we have a special discount for you.”

If the salesman wants to do this, he should have data on purchases that were made on that particular credit card, analyse it in real time, and then make the offer (it would be silly to process this data and reach the conclusion that the customer may need a t-shirt ten seconds after he has walked out of the store). For this, he would need software that is really advanced.

Mr Vivek Ranadivé, Founder, Chief Executive Officer and Chairman of TIBCO Software Inc, believes that software from his company has what it takes to enable companies to do such things, and he probably knows what he is talking about - his company helps around 4,000 customers manage data in real time. In this interview with Business Line, Mr Ranadivé highlights some of the things that make TIBCO tick. Excerpts:

EW: You started TIBCO because software underperformed, while hardware delivered on time. How come this concept has not caught on with the rest of the tech industry?

VR: This is because the rest of the industry is still thinking inside the box. They are thinking about old technologies and old methods, and they are still thinking about using databases.

EW: Your vision for Enterprise 3.0 talks about using technology to deliver the right information to the right place at the right time with the right context. How do you hope to achieve this?

VR: For this, we need to look at lessons learnt from social networking. Social networking is based on three things, namely ease of use, user generated content and virality.

When we apply this in the enterprise, we get Enterprise 3.0.

EW: In 2010, you acquired four companies, namely Netrics, Proginet, OpenSpirit and Loyalty Lab. Are four acquisitions in one year too much to manage from an integration perspective?

VR: No. We are not making bet-your-company acquisitions but are making only small purchases. We are looking for companies that share an excellence for tech and companies that can thrive in the TIBCO culture.

EW: In your bookThe Two-Second Advantagethat you co-authored with Kevin Maney, you mention that hockey players, musicians and CEOs who can predict what will happen will win. Can this be learnt?

VR: In my book, I have mentioned a person called Mystery, who calls himself the world's greatest pickup artist. He learns how to say exactly the right thing at the right time. This is something that can be learnt. For example, in India, Reliance found out that after six dropped calls, a customer would contemplate switching his cell phone provider, so they decided that after the fifth missed call, they would make a special offer to that customer in order to retain him. To make this really work, you have to practice hard, but yes, it will work, and it can be learnt.

EW: There are fears of a double-dip recession in the air. If this happens, your customers will put discretionary spending on hold and this could adversely impact your revenues. Has this happened already?

VR: Thankfully, no. Our business has never been stronger. Our licence revenues are up 30 per cent and our earnings per share is up 35 per cent. We are currently witnessing accelerated growth.

EW: You have mentioned often that the world doesn't need databases. But many cannot contemplate a world without a database...

VR: This is something that needs a shift in mindset. You will need a database to store transactions, but the business will be run with data in memory using bus architecture. Today, the most successful companies in the world, like Google, Groupon and Amazon, use bus architecture to run their businesses, not databases. Databases can't give you a real-time advantage.

EW: Your book gives an example of how a police officer used the two-second advantage to cut down on crime. If something like this is misused, it could lead to an Orwellian 1984-esqe situation. Have you thought about that?

VR: Anything is possible, but in business, we use an opt-in approach, which means that customers opt in because they find benefits. It is your choice whether you want to opt in or not. Also, this sort of technology can be used to save lives - for example, if this was in use, then the police in London could have anticipated the unrest in the people and taken steps to prevent the recent riots.

EW: If all CEOs adopt the methods that you have highlighted, will it mean that they can anticipate the future and ensure that their companies don't go bust?

VR: Well, companies that can use the methodologies will be successful, but saying that all companies can use it is like saying that anybody with a word processor can become like Shakespeare.

You need leadership and culture to effect changes in organisations, but companies that can embrace the change will thrive.

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