It is sometimes quite difficult to understand the core competence of the business that you run. I was musing about this following a conversation with a book publisher who has been looking at our system and likes it. He thinks that it handles his books well, that we appear to be easy to implement, easy to use, little investment is required and we appear to fit in with the strategic direction of the company he is running. He also appreciates that our platform would be customised to match the requirements and style of his company. He went on to say: “But aren’t you really a half-way measure whilst we work up to creating our own in-house content management solutions and creating our own in-house e-commerce system and hosting our own books and customers on our own servers?”

I didn’t have the perfect answer for him there and then (though I think I did refer to computing in the cloud). I am not sure that I have the perfect answer now. But I am absolutely sure that he will not want to build his own proprietary e-commerce and content delivery system. I guess that even the largest publishers Elsevier, Wiley and Pearson etc will be making big mistakes if they reckon on building their own customer and content delivery systems in the days of cloud computing.

But I have been thinking about how we are also looking to outsource as much of our business as we can provided that the outsourced service is reliable and cost-effective and scaleable. After all we don’t want to run our own boxes, or employ more database managers than we absolutely need. The answer for this mid-sized publisher and for us is that you really only want to hang on to the functions that are essential to your business and which you do better than anybody else. Increasingly IT functions will not be the function that anybody wants to retain in-house. We are looking for better ways to outsource important but non-distinctive functions to Rackspace, PayPal, Amazon S3, OpenID etc….

One function that we would still find it quite hard to outsource is customer service (we can do more to automate it, but we have no plans to outsource it to the sub-continent in the manner of Dell). On the other hand we would be very reluctant to hand this crucial function back to the publishers and they are by and large very happy to leave the responsibility with us. I am not sure that customer support is one of our core competences, but it is a reputation-maker and a reputation-breaker. Whatever you do best, you need to make sure that your customers are happy with it.