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I’m amazed and disappointed that it’s still acceptable for people who run major companies to show wilful ignorance of technology. And I don’t mean what firewalls do or how to get wifi working on your laptop. I mean what it means to the companies they run, how it impacts their people and their customers, and how to make sure it’s an asset rather than a liability. And there was an exemplary demonstration of this on last week’s edition of The Bottom Line on Radio 4.

The programme is a straight discussion of business issues with Evan Davis and a number of business leaders. It’s not dumbed down (any more than it has to be edited down) and is a consistently excellent listen. Last week the guests were Luke Johnson, chairman of Risk Capital Partners, Vincent de Rivaz, chief executive of EDF Energy, and Jacqueline de Rojas, UK and Ireland vice president of McAfee. And they dealt with two major topics: organic growth versus acquisitions, and problems with IT. Luke Johnson in particular seemed to really have problems with technology, and to me there was overwhelming evidence that some of the causes might be rather closer to home than he might like to think.

Coming up is some criticism of what Luke Johnson and (to a much lesser extent) Vincent de Rivaz say, but don’t mistake it for a criticism of them as individuals. The point of what follows is that their attitude is representative of so many board leaders. Even though there are many board leaders who have a very confident grasp of technology issues it’s still remarkable there are so many others who handle technology as if they were wearing boxing gloves.

Problems with technology

As the resident IT expert it was Jacqueline de Rojas who was asked first about her own experience of IT problems, and in particular the bad software update that her company issued in April which disabled many of its customers’ computers. Notably, she responded to a technology-related question with a positive and human answer: “The key in a crisis like that is how you respond; that’s how you’re judged”. Then Vincent de Rivaz was asked if he had ever had any IT disasters, and before he could finish his response (along the lines of “no actual disasters, but we have had problems”) Luke Johnson cut in:

LJ: “Every business I’ve ever come across has always been having problems with [its IT].”

VdR: “We have to invest in our IT and we have to develop our IT systems which we are doing at the moment [with a new online system to help our customers with their bills.]

ED: “What sort of problems have you had with your IT?”

VdR: “The problem is to control the costs. That is the permanent challenge for me, to be sure that we are spending the right amount of money on the IT systems.”

LJ: “All my experience of IT systems is they are always overdue and over budget, and I think it’s a built-in part of the IT industry that they deliberately under-quote and then they may get up on the extras.”

Now there are many problems board leaders could have with IT: We aren’t getting the best out of our technology investments. Our technology portfolio isn’t broad enough to help us in a constantly-shifting market. We don’t have the people who really understand how to manage and change our technology infrastructure.

These are all problems that require board-level investment and oversight. And they are also all questions that, if you substitute “financial” for “technology” all boards do deal with. But sadly it’s okay to ignore those matters if they’re technological, and so the top-of-mind IT issues for our token CEO and chairman are (1) cost control, and (2) IT people are sharks.

Indeed, Luke Johnson seems to have something of a chip on his shoulder about technologists. Jacqueline de Rojas goes on to explain a bit about the difficulty of  turning “woolly and aspirational” IT demands into concrete deliverables, but that doesn’t stop him:

LJ: “I think the IT experts blind clients with science, and I think very often they themselves overestimate the benefits, and overcharge for what they do. And the fact is there isn’t another industry, except perhaps pharmaceuticals, that makes the returns on capital and margins that software does. Huge margins.”

JdR: “The level of investment we have to make to stay ahead technologically is also huge. So where do you think that money goes? It goes right back into making sure we stay one step ahead of — in our case — the hackers and cyberterrorists and the competition”

ED: “Let me challenge you, Luke. Is there something different about IT from other areas of company purchasing? Is IT unique in being difficult and awkward for a company?”

LJ: “No, I don’t think it’s unique, but I think it is mission critical, and unquestionably we are all more dependent on IT than ever. I accept all that, and it can deliver huge values, and the very nature of it is it’s constantly evolving. But the truth of the matter is, what other sort of project or product, rather, do you buy that requires these perpetual upgrades and offers such super returns? I was involved with a retailer once, Whittard of Chelsea. We spent, many years ago, the best part of half a year’s profits on building a fully-integrated website. This was in the early days of the web. Within two years we had to throw it away. Because it just didn’t work. We used the wrong suppliers and we made a lot of mistakes.”

To him IT is a homogenous  blob, and he transfers his anxieties freely between commodity software sales (”returns on capital and margins… perpetual upgrades”) and individual business change projects (”a fully-integrated website”). Maybe he’s just exploiting the opportunity to have a go directly at a software vendor, because when Jacqueline de Rojas highlights how technology change really does improve our lives he’s having none of it:

LJ: “What are the cost of goods in software? What are the cost of goods? How much does each new program cost Microsoft? Zero.”

Which is silly, because he knows perfectly well that software (like pharmaceuticals) costs a lot of money to create, and Jacqueline de Rojas has already explained the cycle of investment, return, and re-investment that her market demands.

Where the problems lie

I’m not for a second denying that Luke Johnson’s frustration is unfounded. It’s clearly borne from many hard experiences: this is a man who’s job is to cast his net widely across many, many companies, to look into them seriously, and having done this he finds that “every business [he's] ever come across has always been having problems with [its IT]” and he’s witnessed one of his companies building one costly system only to have to replace it unexpectedly early.

But from where I sit a lot of his problems are of his own making. If you treat IT primarily as a cost then the best you’ll achieve with it is cost control, whereas the best you should get out of it is business transformation. If you think IT contractors under-quote on the basics and expect to make up for it on the extras, then you probably want to structure the next deal differently and be prepared to make it more of a partnership — if you can be confident of being able to act as a partner. If you think IT experts blind you with science then you’re talking to the wrong people — and if you don’t know who the right people are then you need to start filling that gap in your personal network. If you think IT experts overcharge then you’ve created a relationship with conflict at its core and the best you’ll get out of them is the minimum they’re contractually obliged to deliver, whereas you should be getting them to apply their creativity and rigour to help propel your business forward.

The thing that’s really shocking to me is that there are many company leaders like this, who are unashamed of their blunt handling of technology — which is undeniably mission critical — and yet the same people wouldn’t stay a week in their jobs if they demonstrated the same disregard for, say, legal matters or finance.

Which is rather ironic, because earlier in the programme it was Luke Johnson who was called on to be the resident expert on organic growth versus acquisitions, and one insight he provided was this:

LJ: “Many studies suggest that even perhaps a majority of all acquisitions fail to deliver shareholder value. So it’s important to put it into perspective and say if we can achieve returns through organic growth, but perhaps a little more slowly, then maybe that is the more sensible way to proceed.”

Let’s take a second to understand what we’ve just heard: possibly more than half of acquisitions fail to deliver value to the owners of the business — which sounds very similar to his problems with IT. And acquisitions are a significant part of his company’s business — mission critical, even. Just like IT. But in that conversation he wasn’t remotely upset or bitter about this, he just treated it as something to deal with. He could do that because he was comfortable with working in that sphere and, I suspect, because while he might have had his share of acquisition failures they will have been outweighed by his successes.

It seems to me that if board leaders were obliged to grasp technology to the same degree as they are obliged to deal with financial or legal matters then their companies — and their companies’ technology — would be in a much better place.

Two final things

A couple of parting thoughts.

First, some not-at-all-serious observations about Risk Capital Partners. While confirming that indeed they don’t invest in any IT or software companies, I found they do have an interest  in InterQuest, “a fast growing IT recruitment business”. So if Luke Johnson is concerned about the high cost of IT professionals then he might want to have a word with them. Also, I couldn’t help but think if software really is the fantastic high-margin business he thinks it is then RCP really should start making some investments there. I don’t know if they really will make a lot of money, but I do know they’ll learn a huge amount.

Second, a much more serious note. Earlier I said that if these sorts of leaders had IT problems then some of the causes were close to home. But it’s also true that some of the causes lie with us technology professionals. If technology really is seen above all else as a cost to be controlled, and if we are finding ourselves in unbalanced, conflict-driven relationships, then we really do need to do a much, much better job at explaining what we do. And then we have to carry that through into our actions. Technology in business is about making the business more effective and people’s working lives better. We ought to be able to find routes to even the most sceptical business leaders to explain that, and get a positive reception.

Today I attended the launch of something weird and wonderful: a new musical instrument, the Eigenharp. And although this is a hardware device the event, and the run up to it, brought to mind the launch of our own Open Platform six months ago. By seeing some commonalities between the two it gave me a whole new respect for the people who do marketing and PR, because it reminded me how much stuff needs to be planned. Common phases I saw are: (1) the controlled buzz, (2) openness at launch, and (3) the follow-through. But first a few words about the two products…

The Eigenharp and the Open Platform

The Eigenharp is a new kind of device. It’s a musical instrument with several patents already filed, and incorporates 132 keys with three-colour LEDs and a breath pipe. The keys operate in three dimensions (so you can exploit, say, pressure, pitch bend and filter effects with one finger) and are sensitive to within one micron. So while it’s compatible with MIDI, that’s an incredibly out-of-date protocol compared to what you could do with it.

The Open Platform has been well-documented here and elsewhere: a full content API directly into the Guardian’s content database, plus a store of raw data on which our journalists base some of their stories.

Although they are clearly two different kinds of beasts a remarkable similarity struck me in that they are both not just new products, but really new products. There is no clearly defined place for them in either of their markets, and no predictable success path for either one. The success of each is dependent entirely on other people’s innovation. The Eigenharp’s success is dependent on musicians taking their creativity into new directions — no-one to date has written music for an Eigenharp. The Open Platform’s success is dependent on developers doing innovative things with the new data they have access to.

So how do you launch a product that’s really new? The similar steps I can see are…

1. The controlled buzz

Eigenlabs (the creators of the Eigenharp) and the Guardian (creators of the Open Platform) managed to seed a few select people with their product — musicians and developers respectively — and some small details leaked out. This clearly did a couple of things.

First, it helps you get the product right. I know from my conversations around the Open Platform that what might seem a good idea to one or two people close to the product can provoke strong negative reactions when you float it past an informed outsider. When you’re inside the company you can easily think too much and lose the big picture, so it’s good to get an informed but independent view before you go public.

Second,  creating a buzz protects you from a bit of unforeseen negative reaction — if people are excited about your product and want it to succeed they will forgive some minor mistakes. You can see Eigenlabs achieved this with this low-fi video of two guys playing the James Bond/Moby theme on YouTube. Eigenlabs didn’t create this themselves, but they let “close friends” do it, and you can see the reaction in the comments underneath: “What the hell!! This is awesome”, “where can I buy one of these?”, “dear god this is epic” and so on.

The benefits of this are well explained by Lance Ulanoff at PCMag.com. Here he compares the lacklustre launch of the Motorola Cliq with the hype from the January 2009 announcement (six months before the launch) of the Palm Pre:

Speaking of Palm, it has a good bit in common with Motorola right now. The Pre (and now Pixi) is its hail-Mary pass. If the new phone and WebOS platform fail, Palm will be done. Back in January, however, Palm ran the best product rollout event I have ever attended. It perfectly conveyed the company’s excitement and all that is good about the Pre. I remember tweeting the event with mounting excitement. Today, I tweeted the Motorola event with mounting confusion.

What Palm did in January was give the Pre a good hard shove off the shore. Those waves of excitement produced a good six months of positive press. Eventually, Palm and the Pre hit some rough waters—a shipping delay, the slow delivery of the SDK and tiny list of apps that has yet to grow. Still, that first day set the tone.

Then after the buzz is…

2. Openness at launch

There’s much that doesn’t need to be said about the launch event, but one thing that struck me about both the launch of the Eigenharp and the launch of the Open Platform was a common ethos: the honesty and openness of the presenters, and the openness of the products.

At both events the “real users” (musicians/developers) were on-stage demonstrating their early adoption of the product and open to questions from the audience. These are the kinds of people who most marketing and PR people would lock in cupboards at a press event for fear they arrive without the regulation press-on smile and go off-message. But when a product’s success relies on innovation and creativity from its real users then it’s important that intended audience hears an authentic voice.

Also, there is an openness about both products. Aside from the very concept of opening up content and data, the Open Platform gives a lot of latitude to developers, including (unusually) commercial use. Meanwhile Eigenlabs are open-sourcing their software. Again, because each product’s success relies on people taking it in unexpected directions it’s important for there to be as many opportunities as possible for that to happen. Otherwise its success is stifled.

And then finally there’s…

3. The follow-through

Well, it’s early days for both products. The Open Platform API is still in beta, but you can see some developments now, such as the launch last week of the Applications Gallery. It’s even earlier for the Eigenharp. Company founder John Lambert was asked what well-known musicians he’d like to see using his creation and he said that a number of high profile people do have the instrument but that he cannot name any names yet. Clearly some really interesting things are going to happen some time soon.

If a product really does depend on the creativity of others then you can’t — and mustn’t — be too controlling of what those people do with it. (When I spoke to him John seemed slightly apprehensive about the quality of some of the things people might produce around the Eigenharp; I bet Matt McAlister didn’t anticipate a swearword tracker coming out of the Open Platform.) But if you can’t control what others do, you can at least show some examples of what might be achieved, and that’s what the follow-through is doing with each of these products.

1-2-3, easy as A-B-C

Now if any marketing people have stumbled across this blog post I wouldn’t be surprised if they were horrified by the naivety of these observations — all of this might just be first grade A-B-C of marketing for them. But I find this fascinating. As a tech person it’s very easy for me to focus on my own role and not spend much time wondering what challenges are faced by my colleagues in other departments. Here are two products whose paths to success are unusually dependent on the unknown and whose stories will be well worth watching. By looking at the communication that’s gone on around them the significance of other people’s role becomes much more apparent. Technology success is about much more than successful technology.

A quick thanks to the folks at ProgrammableWeb for making my Guardian Tag Bubbles app their Mashup of the Day. It was terrific to see it up there with the likes of the imaginative The Sheep Market and Again But Slower — to pick just two at random.