What does it mean to be one of the world's great software companies?

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At Red Gate it’s our goal – our big, hairy audacious goal - to build one of the world’s great software companies. Tub-thumping words, but it begs the question of what does it mean to be one of the world’s great software companies. How will we know when we’ve succeeded?

Since defining “one of the world’s great software companies” is hard, I thought I’d start with something easier, just to warm up. Something more concrete. This, in fact:

I asked various people at Red Gate how they’d define a horse. I got various answers:

“Four legs”
“Eats grass”
“You can ride it”
“Doesn’t have teeth”

I wasn’t satisfied with these definitions. They could equally apply to zebras, donkeys or even cows. I don’t even understand the last one, but apparently it will distinguish a horse from a chicken. Thanks Laila. For further inspiration, I looked up “horse” in my dictionary:

A large solid-hoofed herbivorous ungulate mammal domesticated since prehistoric times and used as a beast of burden, a draft animal, or for riding

Even that didn’t seem satisfactory, especially its use of the word ‘ungulate’. I then remembered the entry for horse in the first ever Polish dictionary:

What a horse is, is self evident to everybody

I find that much more satisfying. And just as everybody knows what a horse is, I think everybody knows what one of the world’s great software companies is. However, I felt that I needed some more sturdy intellectual backing to my definition. So I turned to this man:

Ludwig Wittgenstein – fellow of Trinity College, Cambridge and world-famous philosopher - was one of the brainiest men of the twentieth century. He said that rather than defining things by the characteristics they have in common, you should define them by a family resemblance. For example, you might look at a family of father, mother, son and daughter and recognise that they are part of the same family. The father resembles – in terms of build, features, eye colour, gait, temperament, and so on - the son; the son resembles his sister; she resembles her mother. However, the father and mother bear no resemblance to each other, even though they clearly belong to the same group.

Similarly, I define “world’s great software company” not by a set of characteristics that every great software company exhibits, but by the loose network of shared relationships that link members of the family “world’s great software companies”.

In other words, you can group all the world’s companies into two, albeit fuzzily bounded sets, of “world’s great software companies” and “not one of the world’s greatest software companies”. Sure, these sets are slightly subjective, but here’s how I might start grouping them:

The ones inside the circle are ones I’d term great. I include Microsoft (it defined the genre), Apple (because of its passion for design and its products), Google (because of what it does and how it does it), Oracle (an enormous success), Adobe (less sure about this one) and the SAS Institute (the world’s largest privately held software company and regularly voted one of the top places to work for in the US). Outside are the ones are companies that I do not consider great. I include Autonomy (local to Cambridge, but not yet great), Yahoo (drifting), Symantec (shoddy products) and Facebook (flash in the pan). Name any software company and you can place it somewhere in this Venn diagram, but note that the companies inside the circle do not share any particular set of characteristics, nor do those outside.

So, in conclusion, I will know when Red Gate is one of the world’s great software companies when:

a)    It is self-evident to everybody
b)    People place it, unprompted, bang in the middle of my venn diagram

This is the first post in a series of 3 about the world's great software companies. Part 2 - a survey asking for your great software companies - is here, then I'll publish the results later on in the week. Make sure you subscribe to the RSS feed and don't miss out.

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Comments

[Brian Yamabe]

"a" and "b" are so fuzzily defined as to be meaningless. Self-evident to everybody? If I ask my mother if she thinks SAS is a great company, she won't have a clue. People place it in the middle of the venn diagam unprompted? What if one person wants to put it in the middle and another wants to throw it way outside. I would say that Adobe is one of the worst companies I have ever worked for.

I don't think it really matters whether you are a "great software company" and I don't think your customers care either. They care about great products.

[Andy Brice]

I am glad to see Symmantec outside the set boundary. They took Peter Norton's products, which were world leaders, and turned them into shoddy bloatware that have to be pre-installed because no-one in their right mind would buy them. Maybe they shouldn't even be in the same diagram?

[Dharmesh Shah]

I'm not sure about the premise of this.

For example, one thing that leaps out at me as a common characteristic across all the companies inside the circle right now is: they are all big (in terms of size). Further, they're all financially successful too (billions of dollars of market cap).

In fact, most people that would put additional software companies inside the circle would likely do so for big and/or financially successful. Not sure this is right, but it's certain a shared characteristic.

Further, I really don't think Apple is a software company. It's a great company, but not a software company.

[Neil Davidson]

Thanks for the comments so far.

Bryan - instead of everybody I should probably have said "people in the software industry".a) and b) might *seem* really fuzzy at first glance, but I was hoping that the blog post argued that that wasn't the case. Not very successfully obviously. Although individuals might have different concepts of "great" vs "not great", I think that there would be a lot of overlap in the companies that people choose, and in which group you'd put them.

Dharmesh - I'm not sure size and financial success are necessary or sufficient to be great. IBM was once 'great' but I'm not sure it still is. You could possibly put MySQL (pre-purchase) in the 'great' category although its revenues are small. I think Web 2.0 is due a shake out, but it's possible to imagine *future* 'great' companies who aren't enormous (digg, or 37signals, in a few years time, say): I don't think *size* is a characteristic of greatness.

[Dan]

Sorry, but Apple is a hardware company not a software one. You might like their software, but that doesn't mean they are a great software company.

[Brian Yamabe]

Okay, I think I see where this was going, Kind of a "wisdom of crowds" where if you let people define "great" the companies that a plurality of people define as great, you'd be able to glean some insight. This might work to get a notion of which companies think are great, but I don't think it would point you or another micro-ISV in the direction of success, because you wouldn't be able to figure out what about those company made people say they were great.

[Steven T Cameron]

A software company can be great even if only a small number of people know about it. Having mass appeal has no bearing on how great a company is.

A software company is great if it produces software that its customers find useful and usable and just simply works.

As far as companies like Apple who are primarily hardware companies, it still produces software so it is also a software company.

[William]

Brand recognition != greatness.

Here are some controversial brands
* Bose - google the controversy.
* McDonalds - a good brand but do you want to eat it?
* Microsoft - mighty, but for what reasons?

[William]

Looking at the list I had to ask:

What is greatness?

Is it a glorious past, regardless of the present?
Is it a company I want to invest in?
Is it software I want to use?
Should I be proud to be associated with them?
Is it that it's "cool" to wear their logo?

[Jack]

Don't say like that, there are millions of people who are working on this industry. I am myself a software Engineer by profession found it very interesting and good profession to be with.

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Jack
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