Episode 83: Beware of the Mushroom Cloud Tech Stack

Audio:

Show Notes

Editor's Note: If you haven't already, leave the podcast a review either on Apple Podcasts or Spotify.

Main Topic:

Doug has noticed for quite some time that tech stacks have been exploding. In an analysis of Octa’s 2020 customer database it was revealed that companies employing 2,000 or more individuals maintained an inventory of 175 apps on average. A similar study conducted in 2019 showed firms employing more than 1,288 apps on average whereas smaller companies employed 100 or more apps on average. 

Both Mike and Doug agree that this data underestimates just how many apps people have and are using, especially now that we’re working from home and have applications on our own computers that don’t have anything to do with work.

As a provider, Mike has been seeing two glaring things with this: 

1. Security and privacy is becoming more front and center. Even small to mid-sized organizations are now requiring you to go through a security audit.
2. More organizations are expecting better integration with their primary OS or platform. 

Because companies are experiencing SaaS fatigue, Doug predicts that this will put pressure on providers to bring some rationale. 

We’re no longer just talking about cloud tech stacks anymore, we’re talking about (what Doug has coined) mushroom cloud tech stacks that have been sprawling technology. 

The move and the hesitancy to the move of technology is that it’s a major cost. Most companies that have a home grown system created it to begin with because of the thought that “building is better than buying” due to control. Now there’s a huge shift taking place which Doug believes is being caused by 3 things: 

1. Pandemic - this highlighted that the systems companies have been using are not talking to each other, and people started to get scared. It became clear that what worked in an office setting was not going to work at home.

2. IT departments are under a lot of pressure - most of these teams aren’t given resources or any additional budget, so IT leg go of the realization that moving over to something not home grown would take responsibility off of their plate.

3. The way sales works today and the way buyers buy - companies can’t work the way they have been; you’re losing competitives because of it.

What is happening and why we’re talking about mushroom cloud stacks is because there is a hub and spoke issue. With product led growth and the number of applications that are available, it’s much easier to implement technology especially with the no code environment. Because of this, people can go out and just buy whatever technology they want and there’s no structure, no organization. 

The working silos in the company aren’t the problem, the strategic silos are. The tech people set the tech, the execs set the strategy, and so on and so forth. Doug came to the realization that there needs to be a balance of 5 things: 

1. Expertise of the tech
2. Business model expertise
3. Business process expertise and design
4. Deep understanding of the business
5. Balance of viewpoint (inside vs. outside) 

There is an explosion that is coming and people are just adding quicksand.

Question: The new holding company name for Facebook was released and will now be Meta with plans of building out a "metaverse." What are your thoughts? Will it be successful or will it forever be a meme for years to come?

The metaverse isn’t an event, it’s when the value of our digital life becomes more than our non-digital life. On one hand there is no stopping the metaverse, and on the other hand you have to have a healthy dose of skepticism. We have to separate the noise from the buzz and focus on the trend. 

However, Meta is a stupid name and will be a meme for quite some time. Both Mike and Doug are looking forward to the day when Facebook will be broken up.

Takeaways: 

Mike - Work hard, make bank. Bank can be substituted with anything.

Doug - Focus on the trend, don’t focus on the gadgets.