1. Future of Application Development Keith Jaeger

2. ©1998 YOUR COMPANY NAME HERE Unprecedented Change Huge amounts will be spent to change applications in the next 5 years Huge amounts will be spent to change applications in the next 5 years The rate of change will increase the risk to development projects - which already “fail” up to 90% of the time (IDC) The rate of change will increase the risk to development projects - which already “fail” up to 90% of the time (IDC) The opportunity to make MIS a competitive advantage consequently grows for those who know how to succeed The opportunity to make MIS a competitive advantage consequently grows for those who know how to succeed

3. ©1998 YOUR COMPANY NAME HERE Driving Forces Behind Change Technology Driven Cost Driven Feature Driven

4. ©1998 YOUR COMPANY NAME HERE Feature Driven Mandated Business Changes Technology Driven Cost Driven Year 2000 European Currency

5. ©1998 YOUR COMPANY NAME HERE Two Strategies Application Rewrite Patch Application

6. ©1998 YOUR COMPANY NAME HERE Budget Impact of Patching Technology Driven Cost Driven Feature Driven Year 2000 European Currency $1.00 a line of code

7. ©1998 YOUR COMPANY NAME HERE Driving Forces Behind Change Technology Driven Cost Driven Feature Driven Distributed Computing Components

8. ©1998 YOUR COMPANY NAME HERE Increased Pace of Technology Change VS

9. ©1998 YOUR COMPANY NAME HERE Glockenspiel Technology Risks NEXT Taligent Token Ring OS/2 Gupta OpenDoc ADcycle MOTIF CGI Bin Smalltalk

10. ©1998 YOUR COMPANY NAME HERE

11. “N-Tier” Client Server NT HP/UX AS/400 Windows client HP/UX AS/400 NT MVS

12. ©1998 YOUR COMPANY NAME HERE Dynamic Partitioning NT HP AS/400 Client AS/400 PgmA PgmB Mobile computing, Failover, Distributed servers

13. ©1998 YOUR COMPANY NAME HERE SMP’s and Clustering Application Task Processor #1 Processor #2 Processor #4 Processor #3

14. ©1998 YOUR COMPANY NAME HERE Cost Pressures Technology Driven Feature Driven Cost Driven New Platforms Labor Shortages Packages

15. ©1998 YOUR COMPANY NAME HERE Labor Challenges Labor Shortage Labor Shortage Skills Mismatch Skills Mismatch Shortening Tenure Shortening Tenure Cost of skilled developers:

16. ©1998 YOUR COMPANY NAME HERE Software Economics Bill Joy’s Law (SUN): Don’t write software for less than 100,000 customers - $10 million = $1000 price Bill Joy’s Law (SUN): Don’t write software for less than 100,000 customers - $10 million = $1000 price Bill Gates Law (Microsoft): Don’t write software for less than 1,000,000 customers - $10 million = $100 Bill Gates Law (Microsoft): Don’t write software for less than 1,000,000 customers - $10 million = $100 Software becomes a commodity Price = Fixed Cost + Marginal Cost Units

17. ©1998 YOUR COMPANY NAME HERE The 90’s - Move to Packages Efficiencies of Multiple Implementations

18. ©1998 YOUR COMPANY NAME HERE Grove’s Law - Horizontal Consolidation Breaks old vertical model Breaks old vertical model Each layer picks best from lower layer Each layer picks best from lower layer A dominant player tends to emerge in each layer A dominant player tends to emerge in each layer Different layers for different price points/hardware Different layers for different price points/hardware

19. ©1998 YOUR COMPANY NAME HERE “Generic” Layer Within Applications Pressure to integrate with “complete solution” Pressure to integrate with “complete solution” New applications move to “generic” list New applications move to “generic” list

20. ©1998 YOUR COMPANY NAME HERE Dominant Players “Stretch” Layers Extend to other platforms Extend to other platforms Redefine layers to leverage dominance Redefine layers to leverage dominance

21. ©1998 YOUR COMPANY NAME HERE Moore’s Law Hardware technology improves 4X every 3 years Hardware technology improves 4X every 3 years While some improvement means more capacity at the same price, there is a downward pressure on prices While some improvement means more capacity at the same price, there is a downward pressure on prices

22. ©1998 YOUR COMPANY NAME HERE Gordon Bell’s Platform Economics Software prices follow hardware prices

23. ©1998 YOUR COMPANY NAME HERE Cost Pressure Software price follows hardware However, costs remain constant

24. ©1998 YOUR COMPANY NAME HERE Application Growth Segments New Hardware Markets New Hardware Markets NT NT Internet Internet Hand held Hand held Home applications Home applications Lower price, little differentiation Lower price, little differentiation New Vertical Niches New Vertical Niches High price, highly customized High price, highly customized

25. ©1998 YOUR COMPANY NAME HERE Customization to Fill Gap Package Price Solution Price Customization

26. ©1998 YOUR COMPANY NAME HERE Reuse Through O-O Procedural Relational Object Oriented

27. ©1998 YOUR COMPANY NAME HERE Failed to Take Hold in Applications Procedural Relational Object Oriented

28. ©1998 YOUR COMPANY NAME HERE New Answer: Components Procedural Relational Object Oriented Components

29. ©1998 YOUR COMPANY NAME HERE Components

30. Component Types VBX controls VBX controls Sliders, graphs, fuel gauges, grids etc. Sliders, graphs, fuel gauges, grids etc. ActiveX controls ActiveX controls similar to VBX similar to VBX 32 bit COM controls 32 bit COM controls Internet enabled Internet enabled Java beans Java beans Internet enabled Internet enabled Downloadable to browser Downloadable to browser

31. ©1998 YOUR COMPANY NAME HERE Benefits AS/400NT Allows you to mix your objects with others on other platforms at any time

32. ©1998 YOUR COMPANY NAME HERE Move to “Business Components” Controls Business Components Packages

33. ©1998 YOUR COMPANY NAME HERE Large Scale Business Components Business Object User Classes

34. ©1998 YOUR COMPANY NAME HERE Jaeger’s Law The more complex a component, the smaller the number of opportunities for its use Corollary: The more business content in a component, the smaller the number of opportunities for its use

35. ©1998 YOUR COMPANY NAME HERE Templates Gartner View of Options Packages Flexibility Cost Custom Components

36. ©1998 YOUR COMPANY NAME HERE Next Major Leap Packages/components that can be customized at a lower cost Packages/components that can be customized at a lower cost More flexibility like templates More flexibility like templates Reuse like business components Reuse like business components Vendors (or in-house development) that achieve these two objectives will establish dominance in the next cycle

37. ©1998 YOUR COMPANY NAME HERE Template “Types”

38. ©1998 YOUR COMPANY NAME HERE Building a Kitchen Plug-ins: add customization into a pre-built kitchen Plug-ins: add customization into a pre-built kitchen Frameworks: customize by following rules to extend a kitchen blueprint Frameworks: customize by following rules to extend a kitchen blueprint Patterns: customization draws a new blueprint Patterns: customization draws a new blueprint

39. ©1998 YOUR COMPANY NAME HERE End User Control of Desktop Fixed Character Windows Desktop Browser Navigation Customized Display

40. ©1998 YOUR COMPANY NAME HERE End User Control of Behavior Fixed Programs “.Ini File” Control Control of Business Rules

41. ©1998 YOUR COMPANY NAME HERE Driving Forces Technology Driven Cost Driven Feature Driven New Platforms Packages Year 2000 European Currency Distributed Computing Components

42. ©1998 YOUR COMPANY NAME HERE Conclusions Massive redevelopment in next 3-5 years due to Y2K, EUC, Web, NT, components Massive redevelopment in next 3-5 years due to Y2K, EUC, Web, NT, components NT and Moore’s law will push package prices lower, but not necessarily solution price NT and Moore’s law will push package prices lower, but not necessarily solution price Vendors who lead the next wave will be easiest to customize Vendors who lead the next wave will be easiest to customize New tools and development technologies will take on increased importance New tools and development technologies will take on increased importance

43. ©1998 YOUR COMPANY NAME HERE