Here’s an update on one of the companies featured in Outside Innovation.
CohesiveFT is a software company. Their products are digital. But I
believe that some of the patterns we’re seeing as customers create
their own digital products hold up well for physical products or for
hybrid physical/service products. 
In
fact, I’m writing this post from St. Louis, the center of the Bio-Belt,
where the products that are sold—seed for growing corn, soybeans,
fruits, and vegetables—are designed and packaged in ways that are
surprisingly similar to today’s hardware and software. As Monsanto's CIO, Mark Showers, explained to me, what’s going on
in bio-agriculture is that there’s an increasing split between the
hardware (the seed or germ plasm) and the software (the traits) of a
plant. Advanced bio-technology has made it possible to optimize the
traits at each layer of the seed stack (below ground/roots;
ground-level/weeds and pests; above ground/leaves, flowers, fruit). In
fact, today’s hybrids come in triple-stacks—soon there will be 4 to 6
stacks—of optimized traits. Farmers select the traits they need in
their seeds based on the soil conditions, pest patterns, weather
patterns, and their expectations of what the growing season will hold.
(Then they hedge their bets through commodities trading where they make
their real money!) While farmers don’t CONFIGURE the optimal seed
traits at each layer today (that’s done in the lab and on the
manufacturing farms), they do SELECT seeds with optimal traits at each
layer for different sections of their farmland. It’s a very
sophisticated and complex set of choices. Much of the value of the seed
resides in the intellectual property involved in optimizing each layer
of the stack for the precise conditions required and in the ability to
mix and match these traits to meet the particular requirements of a
particular strip of farmland in a given micro-climate. Companies
license the intellectual property—the traits—to one another.
This brings me back to CohesiveFT—a company that enables software
architects and developers to optimize the traits of the specific
software they need at each layer of their application infrastructure,
and then to deploy that optimized, mixed-and-matched stack to a
virtualized computing platform. What both industries—software and
seeds—have in common is the need for a high degree of specialization to
meet the needs of very specific applications deployed in very specific
conditions. CohesiveFT’s customers are the developers and architects
who are designing and tuning their company’s most proprietary
applications. 
These aren’t your payroll or ERP systems. They are the
financial derivatives trading systems, or the just-in-time
manufacturing systems, or the real-time supply chain systems, or the
chemical analysis and gene-splicing applications. These are the complex
applications that contain their firms’ true IP—their secret sauce for
making money in complex times. Lead users want to tune the intellectual
property at each layer to have ONLY those characteristics that are
needed for the application at hand, with no extra overhead or
unnecessary traits.
What has happened in both bio-agriculture and in today’s computing
environment is that there’s now a layer of abstraction between hardware
(the physical seed or the physical computer server) and the software
(the layers of specialized intellectual property). In the computing
world, this layer of abstraction has been made possible through
virtualization. You can design a highly specialized virtual computer in
software and run it, along with thousands of other highly specialized
virtual computers, in a virtual data center or in a computing cloud.
I’ve been privileged to be able to watch CohesiveFT closely as it has
evolved its business model and its software model to “run around in
front of the parade” of the lead users/architects that company is
serving. Their software platform has been in beta since July. It has
just now “gone public” with an open community server where you can go
and configure your own customized software infrastructure and
manufacture your own special-purpose virtual computer.
There are a number of learnings to-date from the CohesiveFT
work-in-progress. I’ve culled six principles out of their story. I
think these principles probably work for the design of any
customer-configurable complex product; particularly those in which
customers want to contribute their own intellectual property and to mix
and match components that haven’t been tested in combination before.
The six principles are:
1. Run in front of the customer parade.
2. Add value by tackling the hardest problems.
3. Provide structure and scaffolding to enable creativity.
4. Convert customers’ free prototypes into robust commercial solutions they can use ASAP.
5. Make it easy for lead users to share their creations and learnings with one another.
6. Look for patterns in the way the customers use your tools to build
their tools—that’s your competitive advantage and your future direction!
See my report on this:
CohesiveFT Makes It Easy to “Roll Your Own” Virtual Servers
Customer-Led Innovation in Virtualization, Service-Oriented Infrastructure, and Cloud Computing
March 20, 2008
http://www.psgroup.com/research_874.aspx
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