QlikTech Jumps the Shark
A shocking thing happened last week: a red hot, rapidly growing, recently-public QlikTech decided to strap on the waterskis and do its best imitation of Fonzi jumping the shark in the infamous Happy Days episode. (For those of you too young to remember 70's TV shows or those unfamiliar with "jumping the shark", click here). In Fonzi's case, the writers had run out of ideas and begun looking outside the core formula to try to keep the show interesting. In QlikTech's case, a company who had taken the market by storm by NOT being an enterprise analytics suite provider decided to forsake its core value proposition and challenge the incumbent Enterprise Analytics suite providers head on by becoming one of them.
The surprise here isn't that QlikTech wanted to push into the Enterprise Analytics space - the company IS under pressure to continue its rapid revenue growth after all and enterprise analytics is where the big checks are - it's HOW they decided to do it: by acquiring Expressor Software, an ETL provider. As an industry participant and observer (and fan of QlikView's elegant simplicity), this is clearly a "jump the shark" moment for the firm and I want to talk about why I found that decision so shocking and disappointing.
To put the appropriate context around this moment, however, we need to first discuss the core value of QlikTech's solution to its customers and WHY it was succeeding in the first place: simplicity. Back in the day, QlikTech saw a "small analytics" market need that was being poorly met by the large, multi-product Enterprise Analytics suite vendors with cumbersome and fragmented solutions, like Business Objects, MicroStrategy and Cognos. Only the largest of organizations could afford to deploy and maintain the complex offerings that had been designed to solve the biggest, most complex analytical problems. Small organizations - like mid-market firms or smaller departments in a larger enterprise - were out of luck. QlikTech looked at that "small analytics" need and addressed it by simplifying the problem - they weren't going to provide Enterprise Analytics in a consumable package, they were going to provide a simpler solution that could do most things people would want, quickly and affordably. To do so, they focused on providing the bare minimum required to meet most analytical needs quickly and simply. Specifically, they simplified the process by:
a) providing one UI (dashboards that can support light ad hoc analysis and serve as passable reports instead of three separate tools/servers, one for each use case)
b) removing the reusable logical layer which is required for advanced, scalable analytics but which can be expensive and time-consuming to set up - instead relying on queries run directly on the data.
c) enabling only light scripting and simple joins in the data layer so ENOUGH data transformation and modeling can be performed to enable most common business analyses instead of a fully-capable and, therefore, more complex ETL layer
d) combining all these features in a single, integrated package
This approach wasn't as powerful as the traditional enterprise class solutions but it wasn't meant to be - it was meant to be fast and easy - and the mid-market firms and departments within larger enterprises loved them for it. This approach of "solve lots of smaller, simpler problems for smaller organizations" not only showed in the product, it was evident in their "volume and velocity" sales model in which they would focus on getting ten $30,000 deals rather than on closing one $300,000 deal. The organization and the product were aligned - and aimed at a real "small analytics" market need that the traditional Enterprise Analytics vendors simply couldn't meet. The result was magic - rapid growth, fanatical customers and a successful IPO.
Now, fast forward a few years. QlikTech is public and management is under pressure to grow. The new leadership must decide whether the path to continued growth lies in solving the most COMPLEX analytics problems (where the big boys make their money) or in continuing to solve the MOST analytics problems (where QlikTech has traditionally made its money). The real decision here being whether to keep QlikTech true to the "simplicity" tenet that made it successful in the first place or to move to a "capability" tenet that will enable it to enter the Enterprise space. With last week's announcement, the firm has clearly chosen. That single decision in one stroke destroys the product's elegant simplicity by:
1) adding a metadata layer,
2) introducing full ETL capabilities, and
3) turning QlikTech into a Suite Vendor with two separately architected products.
It is no secret that the company has also changed its sales philosophy by bringing in big company "Suite" sales representatives in an effort to pursue Enterprise Analytics opportunities. With these two developments, QlikTech has definitively turned its back on the "small analytics" problem and is now trying to align its offering and organization around the Enterprise Analytics problem. This is, sadly, the epitome of a "jump the shark" moment as QlikTech forsakes "small analytics" simplicity in an effort to go mainstream. As an admirer of QlikTech's elegantly simple integrated solution, it is an unfortunate turn of events.
The Big Data Gold Rush