Digital Matters - Issue 46

Looking back, you can see how software programs have changed business -- and the culture of business -- forever. In the early 1980s, the spreadsheet program Lotus 1-2-3 sparked the onset of all of those hotshot mergers-and-acquisitions shops. Young, ambitious, smart twentysomethings at Morgan Stanley and Drexel Burnham, armed with 1-2-3, became mini masters of the universe, running the numbers on every company in every business category and targeting the underperformers and underleveraged for shark attack. Investment banking would never be the same.

By the end of the 1980s, we all had Lotus 1-2-3 or Microsoft Excel on our desktop or laptop. Excel came bundled in Microsoft Office, which came with every personal computer. Number crunching was no longer the province of accounting, finance, or high-end consulting. It was something that anyone could do.

The next great leap was groupware. Ray Ozzie and his development team at Iris Associates introduced Lotus Notes, and again the world of business turned. Notes rendered layers of middle management obsolete. Who needed all of those paper pushers? Ozzie's software made it possible to work across, up, and down every division of an organization. Teams could work a project, share their lessons, create valuable records of their team-based knowledge -- and then reform on another team, another project. By the end of the 1990s, Notes had sold 60 million units, or "seats." And as a result, corporations were streamlined, reengineered, and remade.

In the latter half of the 1990s, the Netscape browser arrived, changing business and the culture of business yet again. Netscape gave rise to what the Boston Consulting Group's Philip Evans and Thomas Wurster called the "new economics of information." The Internet erased the trade-off between richness and reach, deconstructed the value chain, and turned Internet technology into a strategic weapon.

With each software advance, management theory focused on the opportunity for organizations to embrace empowerment and on the need for them to disperse power to the edge of the enterprise. Give your people the tools and the chance to do the job, theorists said. Push as many decisions as far down into the operation as possible. That's where customers meet the corporation and where operational intelligence rubs shoulders with demand.

Underlying this software was information-technology hardware that was all about client-server. For all of the ingenuity of 1-2-3, Excel, Notes, and Netscape, the iron still answered the dictates of a traditional command structure. The technology of business worked, in fact, much like broadcast television: A central station sent out packets of information to a hundred, a thousand, a million nodes (or "end users," as they came to be called).

Internet software gave end users the opportunity to gather information from the server and to communicate with outsiders and outside sources of information through the server. But the end user was still dependent on the server. The immense computing and networking power of end-user desktops and laptops lay dormant.

Which is why peer-to-peer computing will likely be remembered as the next great turn of the wheel. In 20 or 30 years, people will probably look back at the present moment and say that peer-to-peer computing changed the game. And in a neat bit of symmetry, the man who has written the first great peer-to-peer computing platform for the workplace -- and for the home as well -- is none other than the man behind Lotus Notes: Ray Ozzie.

Ozzie unveiled Groove last October to great excitement -- as much for what Groove implied as for the elegance of its code. Software experts say that it's still a bit quirky, and because it's so new, developers have yet to invent tool sets that anticipate the full menu of user needs. But Groove is a workable -- and working -- peer-to-peer platform. It will get better and better and better. And corporations will run to it because it will save money (server costs) and bandwidth (clogged pipes).

Groove enriches the collaborative wired experience because it directly connects intelligent agents, creates a fully functional work space -- and will eventually provide all of the necessary tools for what management consultants call "optimally productive interaction."

Groove software makes it possible for people to share text, to share files, to communicate by voice, and to work with one another's tool sets in a completely secure environment. If someone departs and others join, everyone is updated at the moment of entry or reentry. Online or offline, you remain in the peer group, and what you do offline instantly becomes part of the updated "shared work space" once you log back on.