Firesheep, enterprise software and other broken models →
Astonishing stuff from Kevin Marks on corporations and the firewall
“Ben Horowitz’s article on enterprise sales in TechCrunch today tries to justify corporate practices, even as he recognizes the inversion of the innovation flow.”
“What this misses is the underlying economic justification for the existence of a corporation in the first place - the economic theories that build on Coase’s work saying that firms exist because transaction costs are lower within them than external transactions mediated by the marketplaces. Pettifogging internal purchasing rules should be subject to this test: does the internal transaction cost of approving and purchasing something exceed the value of the thing being purchased?”
“Reading Ben’s explanation of how corporate salespeople help institutions negotiate their own labyrinthine processes, I couldn’t help but be reminded of John Hagel’s Big Shift model, (also discussed on TummelVision), which continues to show a declining return on assets for corporations.”
