Networking

Why business software needs to follow Facebook's lead

Business software needs to be redesigned around the model pioneered by consumer social networks such as Facebook, according to the CEO of online e-invoicing and B2B network Tradeshift.

Tradeshift CEO Christian Lanng: Business is a social process and that is the future for enterprise software. Photo: Tradeshift

Business software is broken - and won't be fixed until it takes a cue from the likes of Facebook and learns how to be social.

That's the view of Christian Lanng, CEO and co-founder of the UK firm Tradeshift, whose e-invoicing platform also serves as a social network for businesses.

Despite major enterprise software vendors adding social features such as collaborative and messaging tools, Lanng believes that their products don't reflect the social nature of business. He argues that enterprise software models business transactions in a way that doesn't acknowledge the chain of customers and suppliers involved.

"Business software today is broken in that it's built as islands. You don't know there's a network," he said.

"Business is a social process and we think this is the future [for enterprise software]. We will see the same evolution in the business market that we have seen in consumer. Rather than me having all my business data at my end, it will be shared between all the participants in the process, just as music is shared through Spotify or pictures shared on Facebook."

Tradeshift allows users to build networks with customers and suppliers. As companies share e-invoices with business partners via the cloud-based Tradeshift platform, those third parties can be added to their Tradeshift network.

"It's an intelligent way of building a network as you do business," said Lanng.

These networks can be used for more than swapping and handling e-invoices. Tradeshift users can update others in their network by posting on their profile page - for example, alerting customers in their network to a product discount.

Tradeshift, which is hosted on Amazon's EC2 and S3 platforms, also supports apps that augment the software's core capabilities. About 50 apps have been built for Tradeshift so far, from one that adds PayPal support to another that handles logistics data. Tradeshift has a community of about 100 developers, and apps can be distributed and sold via a store.

The base Tradeshift platform can be used free of charge, but there are also two subscription offerings, Tradeshift Fast Track and Global, which provide greater control over the supply chain and additional services, such as paper invoice scanning.

Fast Track costs about €1,000 ($1,200) per month, while Global ranges in price from hundreds of thousands to millions of dollars. Customers for Tradeshift Global include the National Health Service in the UK and the French government.

Despite Lanng's contention that the traditional software makers don't get social, in May ERP giant SAP announced its intention to spend $4.3bn acquiring Ariba, a cloud-based business-to-business trading network. However, Lanng sees that acquisition as too little, too late.

"I think SAP buying Ariba is similar to when Fox discovered there was something called social media 10 years ago and in a panic went out and bought MySpace. At that time Facebook was smaller than MySpace but it was already growing at rates many times faster," he said.

Exponential growth

Of course, social networks have a tendency to grow like weeds, exponentially fast and in unexpected places, and Lanng said at times it is difficult to keep track of the rate of growth.

"In the beginning the business never grows as fast as you want. Now it's almost the opposite. We're seeing this explosion and we have all these people who want to do something with the platform, and just getting around to answering them and supporting their ideas is really a challenge," said Lanng.

He added that the global nature of modern supply chains means Tradeshift is growing faster in India than it is in Denmark.

Based on its current trajectory, Tradeshift will have one million users by the end of the year, said Lanng, not bad for a firm that three years ago was being run out of a garage in Denmark.

"It was winter and if we put the heating and laptops on at the same time the power would go and we would lose the internet. Basically, we had to choose between heating and the internet. The internet won," he said.

About

Nick Heath is chief reporter for TechRepublic UK. He writes about the technology that IT-decision makers need to know about, and the latest happenings in the European tech scene.

2 comments
Deadly Ernest
Deadly Ernest

but not all clients want that, so you best make sure there is an easy way for the clients to avoid it. Also, you do NOT want a huge social interaction process going on between the staff beyond what's already there to see the work gets done right. So you need to be very, very careful with what you consider along this line.

dpickles53
dpickles53

Google+ with its relationship circles has some obvious correlation to business process. In one business activity, you interact with one set of people across various departments, but in another process, it's a different set of people. Being able to share what's pertinent to just those involved in the process and being able to handle workflows with {only} the appropriate people could be very powerful and efficient.