Tanning Technology Corporation is a bit different from many of the new entrants in the Internet consulting market. Rather than pursuing a full-service consulting model that offers services from business strategies to branding and marketing, through technical design and implementation, Tanning has remained focused on its core strengths in the technical infrastructure and systems development world.
This focus has worked out well for Chairman and CEO Larry Tanning and his team, as the organization has grown from a one-man firm operating out of Larry Tanning’s basement to a company with over $41 million in revenues.
Forrester Research, in its recent report titled "eCommerce Integrators Exposed," awarded Tanning the top score for the Technology Category, which includes systems architecture and systems development. Tanning’s client list includes Ameritech, Blockbuster, Qwest, E*TRADE, Federal Express, MCI WorldCom, and USWest.
The speed of Internet time
TechRepublic: First, I’d like to congratulate you on your Forrester rating.
Tanning: We were pretty pleased about it, and I think it was pointing in the right direction to hopefully let the industry understand where things are heading and, going forward, where the real differentiations will be.
TechRepublic: You mentioned three elements: speed, change, and collaboration in the press release. Let’s talk about speed and this whole concept of “Internet time.”
Tanning: You can look at [speed] a couple of ways. You can talk about it in terms of a need for time-to-market, but in terms of how Tanning is involved with our clients, it’s about real-time processing. Being able to respond quickly and in a real-time manner, whether it’s collaborating on transactions or customer relationship, it’s an issue of having the right information or content at the right place at the right time. Speed is double-edged and always will be, but we’re entering a new era where a lot of the cookie-cutter ”time-to-market” or ”Internet-time” hype of the last couple of years will drop away, and it will be all about the large infrastructure players, the brick-and-mortar companies, and the traditional companies who are really still running corporate America, stepping up to connect on a speedy basis.
We’ve just scratched the surface in the concept of Internet time. The first generation of this has been first-grade-level stuff that is not going to stand the test of time. When I talk about speed, change, and collaboration in terms of where the world’s going, I’m saying, “Let’s get real, and let’s talk about real businesses that have infrastructure, customers, and value propositions that now need to be turned quickly into businesses that are connected to this new world.” It’s not the dot-com world; it’s a network economy, or a grid economy, as we call it.
TechRepublic: I’m interpreting from your comments that you think there’s been some hype around the migration to the Internet economy, and that you’re expecting some of the more established enterprises to move in now and develop real competitive advantage on the Net.
Tanning: We’re in a nine-inning ball game with this Internet economy, and we’re approaching the fourth inning. The first couple of innings were all about concepts of Internet time—get something out there, try to make a land grab on the Net—more for creating a value proposition in the stock market or the IPO market than for gaining a sustainable business model. We’re now in the B2B exchange inning, which in some ways represents a lot of the same B2C mania that we saw in the last couple of years. But if you think about where we’re heading, there will be a lot of exchanges that will be sustainable and have a place in our economy. But if you listen to a lot of the analysts, a lot of that will drop away as well.
As we head into the network economy, which is all about true collaboration and change, real companies are going to see opportunities to participate in revenue or wealth-creation opportunities. It’s all going to be about their ability to adapt and to change. It’s all about speed in terms of how quickly they can have the right offering or the right content to add value to that economic opportunity, and finally it’s about the collaboration, where sometimes they will be collaborating with other players as part of that value proposition. That’s all about integration, flexibility, and a whole new way of looking at things that is much more challenging and much more complex than a simple concept and a cookie-cutter approach of cobbling some packages together.
The value of e-commerce
TechRepublic: When you talk about collaboration, it brings to mind the Cisco “single enterprise” concept, where they use the Net to reach out to customers, to resellers, to other manufacturers, to other players in their value chain, and it sounds like you believe that type of approach, the virtualization of the enterprise via the Net, is going to be a big part of the Internet economy’s real value.
Tanning: I think Cisco is an early view of where the world’s going, and a lot of companies are going to need to get out of low-value or noncompetitive functions and actually go outside and collaborate with other companies. Companies need to focus on what they do best, not on what they do mediocre. Walls are being torn down in terms of commoditization of services and business functions. That’s what’s really happened to Cisco—they’ve decided to collaborate with the best of the best out there so they can come to market quickly and deliver new generations of services and offerings on a time-to-market basis.
TechRepublic: From my research into the Tanning Technologies business model and philosophy, I understand that you’re not really competing directly with the razorfish or Scient type of full-service agency model, that you’re very focused on the building of enabling technical architectures for Internet businesses.
Tanning: We’ve been very consistent in the marketplace in that we have deep technology roots, and having these deep capabilities, the companies that we work with are sophisticated users of IT. The bulk of the money that these companies spend is in that technology area—they see that as their gating factor to success—and we focus on that and stay pretty true to that. We collaborate with design firms and strategy people, but we also find many companies that do a pretty good job in terms of their own strategy; they just don’t know how to implement it.
TechRepublic: So, in scenarios like we talked about with Cisco, where there are complex requirements to integrate with external suppliers, component manufacturers, and resellers with different systems and networks, is that your sweet spot, the place where Tanning can really add significant value?
Tanning: It’s all about this integration wall, and we feel like we’re well positioned for that. You’ve been in this IT consulting world a long time; you understand that the bulk of the world is running on four generations of old technology. The technology might have been patched up for Y2K, but the world is still running on systems that were never designed for the Web. They weren’t designed for 24/7, or for spike loads like you get with successful Web offerings, yet there’s a tremendous asset and value in that infrastructure, and there’s no reason in the world why it should be replaced. There’s no cost justification.
It’s still processing many of the core transactions and storing much of the data that’s necessary to be effective in this new economy that we’re talking about. That’s the dirty little secret. Many people want to talk about Internet time and Web design. But the reality is that putting out a nice user dialog or pretty graphic is a great thing, but giving timely access to meaningful information, and in a way that meets the service level requirements, is an entirely different challenge. There aren’t a lot of people talking about that, but that’s what Tanning is planning to do; that’s what our core competency is: Dealing with high-volume, mission-critical, disparate systems that you have to attach to in an unobtrusive way, that not only grant access to that asset but also leverage it for the new marketplaces and new offerings that will define success in this fourth, fifth, and sixth inning.
More dialogue between Tanning and Freedman
In the next installment, I’ll talk with Larry Tanning about the project management and consulting methodologies that Tanning Technologies uses to guarantee the quality of their services to clients, and we’ll discuss the importance of values and culture to building a professional services team.
Freedman is the author of The IT Consultant: A Commonsense Framework for Managing the Client Relationship and the upcoming book The Internet Consultant, both by Jossey Bass. He is the founder of Consulting Strategies Inc., a training firm that advises and mentors IT professional services firms in fundamental IT project management and consulting skills.As a supplement to his Consultant Master Class column, Freedman periodically interviews a leading executive, practice manager, or consultant from the top IT professional service firms. According to Freedman, the practicing consultants out there every day, selling, planning, and delivering projects for clients, are the real masters. By giving them a chance to share their concepts, techniques, and lessons learned, he hopes to build consensus among consultants on the industry’s best practices and methodologies. If you have a question for Rick, e-mail us.
Rick Freedman is the author of three books on IT consulting, including "The IT Consultant." Rick is an independent consultant and trainer, working, through his company Consulting Strategies Inc., to help agile teams and organizations understand agile practices and migrate successfully.