Jan 7, 2021
So I noticed Ryan Cunningham, Product Lead for the Power Apps side of the Power Platform for Microsoft, suddenly come available in Teams. So of course, I ambushed him, and we had a great conversation about Power Apps and the whole Microsoft Business Applications group. Enjoy!
Transcript below:
Ryan Cunningham:
Hello. This is Ryan.
Steve Mordue:
Hey, Ryan. Steve Mordue. How's it going?
Ryan Cunningham:
Oh, Steve Mordue. How you doing? Does this mean I'm in trouble?
Steve Mordue:
No, you are not in trouble, but you are about to be a guest on my
Steve has a Chat podcast if you have time and are up for it.
Ryan Cunningham:
You mean like right now?
Steve Mordue:
Like right now. Already recording.
Ryan Cunningham:
Hey, okay. Let me check my calendar. There's nothing I'd rather do
right now than being an impromptu guest on a Steve show.
Steve Mordue:
Well, we'll try and make sure you don't regret that decision.
Ryan Cunningham:
I regret a lot of decisions, Steve. But it wouldn't be the
first.
Steve Mordue:
So let me ask you first, how long have you been with Microsoft?
Ryan Cunningham:
I just crossed five years.
Steve Mordue:
Five years.
Ryan Cunningham:
Just this past fall.
Steve Mordue:
I used to be a Salesforce consultant. We were Salesforce
consultants for about 10 years and we moved over to Microsoft when
they first moved CRM online back in 2011. So about 10 years
ago.
Ryan Cunningham:
Sure, yeah.
Steve Mordue:
And I remember there being a few bumps making that transition going
from on-premise to online, but then it kind of leveled out into
what I kind of called the lazy river ride. It was predictable, it
didn't move very quickly. There was no urgency and then James took
over and he brought in all you young guys. It's been like a rocket
roller coaster ride ever since. You ever got one of those really
big roller coaster rides where you start praying for it to end, but
you know it's not going to. It's just going to keep looping around
and you can't get off. I almost feel like for a lot of us partners
that have been around at least since it was lazy river, man, my
head is rocking from all of the stuff you guys are doing.
Ryan Cunningham:
We don't do lazy rivers very well, Steve.
Steve Mordue:
Not anymore.
Ryan Cunningham:
Not anymore.
Steve Mordue:
Not anymore.
Ryan Cunningham:
At least class three rapids around here.
Steve Mordue:
How is it like on the inside for that kind of pace and ideation and
everything that's going on internally?
Ryan Cunningham:
It's a great question. It certainly has not been constant here
either. And again my experience in this community is not as long as
yours. I joined at about five years ago and specifically joined the
Power Apps team long before Power Apps was really a thing. I joined
the team when Project Siena was for those that are familiar with
that term, the sort of precursor to Power Apps was kind of in an
early beta phase and there were grand ambitions of expanding out
who could build software, but not a lot of... How do we say it
coming out? Not a ton of product truth yet behind that.
Steve Mordue:
So I was in the audience, I think for one of your very first
presentations before a big group of this product. You looked a
little deer in the headlights at the time.
Ryan Cunningham:
I still feel that way sometimes. But if you take that over the
course of the last five years where that idea has solidified, that
product has gotten more mature. Certainly there's still more work
to do, but we've gone from literally zero humans using at least
standalone Power Apps to millions around the world and really also
in the same breath gone from very long tail, very simple use cases
to this grand merger with the Dynamics platform and customers
building and trusting frankly much more sophisticated workloads to
the platform.
Ryan Cunningham:
The world has changed a lot for us internally in how we approach
this problem as you go through that product maturity life cycle. In
the early stage, it's really about can we make anyone successful
here? Now, it is much more about how do we scale and how do we
focus on enterprise trust and developer productivity and really
turn millions into hundreds of millions and that's...
Steve Mordue:
Oh, we got a little stall there.
Ryan Cunningham:
Right. Did I lose you for a second?
Steve Mordue:
Just for a second. I kind of sometimes think of Microsoft kind of
like the Japanese manufacturing economy where they saw ideas that
we would come up with and then they would put all their resources
to make it better, faster, cheaper whereas a lot of the things
we're doing in the power platform are not things that weren't being
done before by others, it's just that someone on the team somewhere
recognize hey, there's this movement going on out here with some of
these smaller players and I think it's got some legs, so let's
let's drop all of the arsenal that we have available as Microsoft
onto this idea because clearly, we weren't the first low code
platform right, but suddenly we're bringing everything Microsoft
has to bear on this idea and to see it blow up like that.
Steve Mordue:
You can say that for almost everything that we've got going on, the
bots, the flow, all of these sorts of things. We weren't the first,
but then we came in and just put all this horsepower into an
idea.
Ryan Cunningham:
Yeah. And it so much is about execution and executing at the right
time and doing it for the right people. I think part of the reason
why we internally work quickly and don't want to be on the lazy
river is also because I think we tried to approach it with this
fundamental... This is going to sound weird, but distrust of our
own instincts to say, "Look, we have a thesis that people are going
to want to build software faster. We have a thesis that they're
going to want to do that beyond just forms over data." That's going
to take many different forms, but in the nitty-gritty details of
who's actually going to find the most value in individual features
and individual assembly of those features, there's a lot of margin
for error.
Ryan Cunningham:
And the sooner you get real software into the hands of real humans
and they can use it and react to it and give you feedback actively
about it, but also just give you feedback through their usage or
non-usage of it, then the sooner you have real data to adjust and
change and do the next thing.
Steve Mordue:
So it's not really like build it and they will come, it's more like
build something and let's see who comes.
Ryan Cunningham:
Exactly.
Steve Mordue:
And then build some more.
Ryan Cunningham:
Exactly. Develop a relationship with those people who have come and
then make sure that you're building it in a way that they're going
to get really excited about it and then extend to others. So we
really prioritize when we have enough of a hypothesis to head in a
direction get there as soon as possible in the world and then work
really closely and quickly once you've landed there to make it
great and learn, and be willing to be wrong and be willing to
change.
Steve Mordue:
Don't worry. I pointed out when you [crosstalk 00:07:43]. It's a
lot of moving parts. I know you came in through the Power Apps door
but have since kind of got your fingers into the whole pieces of
platform it feels like. There's a lot of moving parts going on.
Whenever you have that many moving parts, there's going to be bumps
and issues along the way. So I can imagine that's just a continuous
thing that somebody's building something over here. Somebody over
here. Maybe they didn't coordinate as well as they should have and
it gets discovered later and then I imagine these little fire
drills going on internally [inaudible 00:08:20].
Steve Mordue:
Left hand wasn't talking to the right hand enough. Let's get that
stuff going on. Is that part of your role is to referee those sorts
of things or identify them?
Ryan Cunningham:
I guess you could say that. And that's also part of growing a
product and a team across a really wide surface area. How do we put
in place the right listening mechanisms to customers, to data and
reviews internally so that we can catch those things sooner and
react to them more quickly. Because in many ways the ambition here
is to span a really wide area of software and do it with a platform
that has value and relevance to a number of different people in
that spectrum, which is fundamentally really hard.
Ryan Cunningham:
It's one thing to build a focused experience for one very focused
narrow niche of people, it's another... That alone is hard. It's
another to build a set of tools that a lot of different people can
use. But I think that was actually part of our... If you rewind
several years ago and look at what we did between the Power Apps
software project which started independently and the Dynamics
platform and bringing them together, we really realized at the
limit these things converge. At the limit, making it easier for
non-traditional software people, citizen developers, amateurs,
makers, whatever you want to call them and making it faster for
professionals to build apps, those two ends have to meet each other
at some point for this to really scale. So let's rip that band-aid
off.
Steve Mordue:
How close do you think we are? How close do you think we are to
getting to that ideal point? I mean, I think there's still... Even
when I look at the citizen developer stories, a citizen can go so
far and obviously we'd like them to go as far as they're able to
go, to comfortably go and pro dev takes over. I have to assume
there's a continuous motion inside to keep trying to move that
line. Let's simplify some of these formulas that may be required
that are just whatever those stopping blocks where you see a
citizen is able to get this far, it hits a wall. Can we get them to
the next wall? How much is going on in that process?
Ryan Cunningham:
It's a great question and it is really one of the central things
that keeps driving a lot of what we do. I mean, we also look at a
professional's experience through that journey, right? You look at
not enlightened professionals such as yourselves, but all of the
other software people out in the world who are very skeptical of
platforms and who have an instinct to start from scratch and write
everything themselves and go through some-
Steve Mordue:
Some of that could be financially motivated also.
Ryan Cunningham:
Oh, sure.
Steve Mordue:
Yeah.
Ryan Cunningham:
Right? But I think realizing that two trends are really converging
here. To your point earlier, low code is not new, but we've had low
code in two very different camps. This is the company that shipped
Excel 35 years ago, 36 years ago. We certainly know low code for
true amateurs and there's always been this world of people without
a software development background working around the boundaries of
the software they're given with tools to solve problems and that
goes straight to-
Steve Mordue:
To Access wizards.
Ryan Cunningham:
Absolutely. Excel macros, VBA, Access, InfoPath and a number of
other products outside of Microsoft. That's an enduring tradition.
Then on the other side, what we've been doing is professional
software people for the last 40 years is just adding layers of
abstraction and tooling and not repeating ourselves and borrowing
from other people to more efficiently assemble solutions as well.
You can look at a platform like what XRM was unofficially and
Dataverse and Power Apps on top of it now is just a natural
extension of making professionals more efficient by not doing
everything from scratch.
Ryan Cunningham:
Now, that's where those two trends converge and you're absolutely
right to answer your question. We focus on okay, we made a number
of people successful at that. There's a plenty of existence proof
in our community and in our growth numbers and in our customer
stories of people coming at the product from both of those
directions and getting really successful and having a lot to show
for it. Now of course behind the scenes, we're still, I would say
very hungry. We're still at a couple orders of magnitude less than
the addressable market of software consuming humans of what we
could be serving even for all the astronomical growth we've seen in
the platform over the last couple years.
Ryan Cunningham:
I mean, so it is absolutely about how do we take people coming in
the front door. I'm a Teams user. I have some Excel skills. I
happen to stumble on this Power Apps thing. How far do I get on my
first try? What brings me back? How do I go from a user who
expresses intent to a user who has a moment of success, to a user
who then has an app that's used in production. And even from that
point to somebody who keeps coming back to keep putting apps in
production.
Ryan Cunningham:
Then similarly as a professional, how do I expand my tool set from
Azure and Visual Studio and how do I have good experiences in my
first try with a platform. How do I get to a point where I put
something out there that humans are using in the world and I feel
good about it. We really closely look at retention. We look at
funnels through those early experiences. We look at satisfaction.
All those annoying prompts of how likely are you to recommend Power
Apps to a friend or colleague. Those are really valuable data
points for us in addition to just the general growth rates overall
because of indicators of the likelihood to be successful and grow
in the future.
Steve Mordue:
I know we definitely have had success with enterprise organizations
in particular where IT has embraced this and shepherded the process
and built in their own systems like at the whole chevron way that
they go about making power apps developers out of their employees
and they've got a very specific process. I guess the other side of
the equation is a smaller company that doesn't have those kind of
resources. It's just Bob who's always been handy with spreadsheets.
Suddenly he's trying to figure his way around. It seems like that's
the one where we can't give that guy too much help.
Steve Mordue:
In enterprise they're going to have their system. Maybe have
classes internally. They send their people to and stuff like that.
It's a smaller organizations where he's left to the documents he
can find and what he can understand. I think one of the things that
Microsoft has always been a little bit of a challenge with
Microsoft and documentation in particular is that they assume a
certain level of understanding, in particular Microsoft and there's
lots of folks that are coming to the platform that have zero
understanding of Microsoft or history or know anything. Even
acronyms or none of it.
Ryan Cunningham:
Right.
Steve Mordue:
It's almost like you can't make the documentation too dumbed down
to get to that success. Well, how big is the team up to? Now, the
last number I heard, and this has been a while ago, it was like
7,000. It was a pretty, pretty good sized team for the bag. How big
is it now?
Ryan Cunningham:
That's a good question. I'm not trying to dodge you. I suppose I
could look it up. I don't know for sure what James is... That whole
business applications group org size is, but that's actually
probably a decent estimate now that's not too inaccurate. Now,
that's spread across a really wide surface area. All of the first
party Dynamics apps have dedicated teams working on them. There are
a number of other orgs within that organization focused on things
like advancing AI and whatnot and then there's the core platform
team, the Charles Lamanna team which I'm a part of which we
structure into a core team focused on the backend, on Dataverse. A
core team focused on each of the front-end products, so Power Apps,
that's my team, Power Automate, Power Virtual agents. Then we also
have a dedicated group in the platform org around admin and pro
developers, and those experiences.
Steve Mordue:
I think when he came in, there was closer to a thousand on the
team. So I mean the team has exponentially grown because you can't
keep a lazy river going.
Ryan Cunningham:
Nope.
Steve Mordue:
You got to have speed when you got that many people on the payroll
all working on something. So I also recall a time and I know it's
still there, where there was a maniacal focus by the business
applications group on the competitors particularly Salesforce at
the time. I know that Salesforce is still in the radar. It does
feel like we've kind of moved from really being focused on one
primary competitor as we've launched all of these different
applications into other competitive spaces where now you guys have
hundreds of competitors that are all out there. How much do you
guys focus on what the competition is doing internally and how you
guys gauge what directions to go?
Ryan Cunningham:
It's really important to be aware of what people are doing in the
marketplace. And we do spend a lot of time making sure that we have
an intimate and hands-on not just academic understanding of what a
lot of different software companies are producing out there.
Steve Mordue:
So you guys have licenses for everything.
Ryan Cunningham:
Well, where we can and it gets complicated because Microsoft also
partners with many companies. Some companies we have agreements
with about who will or won't use what software and we've got a lot
of great lawyers to help us navigate that whole [inaudible
00:18:23]. I think the point is look, we're adding software to a
world that already has a lot of software in it. It's important to
look left and right and be aware of what else is out there because
none of this stuff gets consumed in a vacuum by customers. You go
to any moderately large customer organization, there's already a
CRM system or seven in place. There's already an ERP system or
eight in place and there's already a bunch of individual systems
around that for point things and that's just the world we live
in.
Steve Mordue:
And if they're exploring something, they're seldom exploring one
thing.
Ryan Cunningham:
Exactly, right? And often if they're exploring especially a
platform. There's a lot of existing things and a lot of the
conversations become about how does this work in an existing
ecosystem and how does it work? How can it potentially consolidate
some of those things? We had Ecolab at a recent digital event
talking about some of their Power Apps and Dynamics
implementations. The average field employee at Ecolab had something
like 27 different individual tools that they had to use to get
their job done and it was a mix of... I mean, they had dynamics and
they had Salesforce, and they had an ERP system, and they had a
whole bunch of individual custom homegrown things and this
experience was just really terrible for somebody out there on a
tablet or a phone trying to inspect your water filter at your
company.
Ryan Cunningham:
Starting to bring in Power Apps as a front door to some of those
other systems without replacing them and just even making the
wayfinding better is key. So look, it's important for us to be
aware of what the world is doing. I would say it's never as simple
as pure competitor or not in that picture because look, if you're a
company like Microsoft, a lot of the names you rattled off or
alluded to are also Azure customers and they're partners with them
in other places. We're fundamentally a platform company I think is
what it comes down to.
Ryan Cunningham:
The world is better when people can choose what they want to choose
and are able to interoperate with those things at scale. Now
obviously, there's incentive for us to have them using our stuff in
that mix which is why we care a lot about it, but there's really
not... Especially if you look at the body of what we offer even
just in the platform, there isn't a clean head-to-head competitor
right now for all of it. There are certainly competitors for each
piece and I think being aware that those customers have choices and
that we want them to genuinely choose the best and we want to be
the best, that means we have to be aware of what best is and what
customers define as best is just as important as what the guy down
the street is offering. I think that the business applications
group has the advantage of the enormous coattails of Office 365,
now Microsoft 365.
Steve Mordue:
Sure. I don't know how many calls I get from a brand new customer
who the primary reason they're looking at this platform is because
they're already using Microsoft 365. And this idea that we want
everything to work together and talk together. I think those
coattails are an example of coattails that some of the other
companies just don't have. You look at Salesforce for example. They
don't have this productivity suite with millions and millions of
users. So their story is going to be... We can integrate story and
I just see more and more... I think we have to give such a credit
for this because for many years Microsoft had a mixed reputation
with IT.
Steve Mordue:
There are lots of people that hated them and all sorts of different
things and such. It kind of seemed to have changed the attitude of
the company to where IT who used to be like we're using on-premise
exchange that's the only Microsoft thing we're going to touch. Now,
they've brought in Microsoft 365. Now from an IT standpoint, it's
you know what, I don't want to make my life any more difficult than
it needs to be. What's the most logical choice for business
applications when we're already stood up on all of this stuff and
it's an enormous advantage and a huge coattail for the whole
business applications group to ride in on.
Ryan Cunningham:
Yeah. I mean, this is why we focus so much on the platform working
well in Teams for example. We've put a lot of effort into that this
past year. I mean, part of that is the world turned upside down and
changed and everybody started working in Teams. The other part of
that is it's a huge advantage for a customer to be able to program
and customize the collaboration environment whatever that is.
Again, there's a long history of that within Office with SharePoint
and InfoPath and stuff like that, but being able to look at that in
a modern world and say, "I already have every employee working
every day inside the team's environment. If I can start to put line
of business applications in that environment, it's much easier for
those employees to discover and it's much easier for them to then
work around and collaborate around when those experiences require
some form of collaboration."
Ryan Cunningham:
There are major Microsoft customers, Fortune 500 customers with
tens and hundreds of thousands of users in their tenant that have
more than half of those users using a Power App and Teams every
month. You see IT departments using it. Those are not necessarily
bottom-up Citizen Developer apps. You see IT departments really
seeing that as a way to sort of re-imagine maybe what we might have
called an intranet site 10 years ago sort of imagine an
employee-facing app in the place where employees are already
working.
Steve Mordue:
Sometimes, I actually feel a little guilty that one of our biggest
growth years was a result of a virus and certainly the same could
be said of Teams. I mean Teams was doing fine, but a virus really
catapulted Teams to the position that it is. You feel a little
guilty, but then again it is what it is and somebody has to feel
that that need and it does create some massive opportunity.
Ryan Cunningham:
For me, especially rewinding to March and April, and May, I mean
this was really a pressure test of our whole promise. The whole
shtick and spiel of saying you can develop apps faster, you can do
it quickly, you don't have to go through all the time and expense
of software development, you can put it where people want to use
it. Got a lot less nice to have in March of 2020 went from a lot of
people from, "Oh, that sounds cool. I'll check that out
someday."
Steve Mordue:
Someday.
Ryan Cunningham:
This is interesting to this is the only game in town. There were
moments where I don't... I hear what you're saying. It is difficult
to go feel like you're thumping your chest about business success
in a year where a lot of people have had a really hard time and I
really want to be sensitive to that. At the same time, the platform
has really directly and indirectly helped a lot of people with
those struggles. A whole number of both through the healthcare
response to COVID, solutions that were implemented almost literally
overnight in some cases for major state governments around the US
and national governments abroad to first roll out large-scale
testing programs on portals with CDS or Dataverse behind it and
then roll out economic assistance programs on the same
platform.
Ryan Cunningham:
Now rolling out return to work solutions on the same platform.
Those are things where the traditional model of start up a
waterfall development process, go write a giant requirements
document, triple bit it, go through... You don't have the luxury of
the Gantt chart in this world and you have to be able to move fast.
And those are places where that is the platform we've been building
for is that environment where we got to move fast. We have to do it
non-traditionally and we have to do it with a lot less effort.
Ryan Cunningham:
This last year has really forced us to hone in on that value prop
and prove that it's real, and frankly adjust a lot to make it more
real for people who are trying to get that value. So I would say we
have learned a lot in the course of this pandemic. A lot of people
have. But we've also been able to do some good for the world in the
same breath.
Steve Mordue:
It definitely was interesting timing because if you guys probably
had to pick a time for a super crunch test of our platform maybe
you don't like to see it in another year out or something.
Ryan Cunningham:
Yeah, sure.
Steve Mordue:
You can't cage these things, but it kind of hit when you guys still
had some wiring to finish and I would imagine that the pressure on
the team... It's one thing to we got to be out to market quickly
because of competition. It's another thing because something like
this has come. It has to bring a huge amount of pressure the team.
We need to take Teams to the next level. We need to take build your
own apps the next level and suddenly we've got an entire workforce
that is now working from home that never planned to be working from
home that is completely ill-equipped for that entire motion and
these people need this stuff fast.
Ryan Cunningham:
Not to mention an entire generation of students who are now
learning remotely, many of them in every age group from my first
grader up to colleges and in universities. It's affected everybody.
But you're right. I mean, the platform has been stretched at every
level and it's not just the power platform. You're right. It's also
very much Teams. I saw a really interesting internal presentation
from an engineering leader in the Teams org comparing, "Look,
here's what our load and traffic pattern looked like in January of
2021 and then to scale superimposing that on what it looked like in
March." Not to say that, "Hey, look at all this great growth," it
was really to say, "Look at what it took to go scale a planet scale
service that dramatically that quickly." That was not a pleasant
experience for the engineers having to work on that. That was
[crosstalk 00:28:54]-
Steve Mordue:
A lot of late nights.
Ryan Cunningham:
... 24/7 as any other response. No software is perfect. We like to
gripe about everything and I share my set of barbs with stuff, but
man, I have a ton of respect for the Teams engineering group and
how well they have handled that just massive overnight change.
Steve Mordue:
So as we're recording this, vaccines for the virus are rolling out
and I assume at some point in the coming months, it'll be behind
us. In the meantime, it was around long enough to push lots of
people to work from home longer than maybe their company owners
thought would have to happen, but now they've gotten used to that.
They've made accommodation. They've made it work. What do you think
is going to happen when this particular crisis has passed and
there's the ability to go back to normal? What do you think is
going to happen with all these folks? Are we going to see a mass
return to offices? Are we going to see people say, "This is
working"? What are you guys thinking?
Ryan Cunningham:
I mean, it's a good question. I don't know that I can speak for all
of Microsoft on this one, but I think at least in our own team-
Steve Mordue:
What do you think?
Ryan Cunningham:
I mean look, our team is already very globally distributed. We have
the majority of our engineers and core products, PMs working in the
Pacific time zone, but we have a significant group in Paris. We
have a significant group in Bangalore. We have individual pockets.
We have people in Fargo, North Dakota. We have a team in-
Steve Mordue:
Israel?
Ryan Cunningham:
We certainly have team in Israel. We have teams in parts of Europe.
We have a team in Toronto. If nothing else, I think the core of
[inaudible 00:30:49] sound based team has developed a lot more
empathy for the experience of the very significant portion of our
group that works around the world. I'm very experienced joining
Teams. And I really hope that that continues if nothing else even
if we all end up back in offices at a more regular level.
Ryan Cunningham:
We've learned at digital events and conferences and stuff.
Certainly, it is not the same as being in the room with people
catching up and networking, finding those discovery and unplanned
moments with humans. And I do believe that we will go back to
getting in rooms together both as employees, but also as
colleagues. I really hope that we get to do that again soon.
However, some of the digital events that we've pulled off as
unelegant as some of them have come together also very rapidly
having to figure out how to completely reimagine conferences like
Ignite virtually in just a few months, those themselves were
gargantuan tactics. In some cases there were orders of magnitude
more participation in those events than when you had to get on a
plane and fly to Orlando to get the benefit really. So there's-
Steve Mordue:
If I'm Microsoft, I don't know how eager I am to go back to
in-person events given the success of like you say, I mean, so many
more people able to attend. Microsoft's goal in having an event
isn't for us all to hang out and have beers, it's to disseminate
product information to his broader audience as possible and as deep
a format as possible. Sitting in a session room, watching some guy
present a slide deck, maybe it's a little more interactive, but not
enough more interactive to justify the 30 people behind me versus
3,000 people that could be behind me in a video meeting.
Steve Mordue:
So from Microsoft's standpoint, you would think that, "Hey, great
news. We don't have to go back to doing live events," which are, I
think, they got to be a huge expense, a huge logistical challenge,
all that sort of stuff. So the only reason to go back-
Ryan Cunningham:
I mean, I imagine-
Steve Mordue:
... would be camaraderie or something.
Ryan Cunningham:
Like all things moderation. I'm sure we will... I hope we will
reconvene at least some live events and I'm sure we will. I think
we've learned that there's probably a bias before this year, this
past year that the digital portion of a live event would be much
less valuable. I mean, even already, I don't want to overplay that
hand. Even already, we would frequently get more total usage over a
lifespan of content consumed digitally when it was produced at the
live event than at the live event itself.
Ryan Cunningham:
You could take a keynote at Ignite. There's 3,000, 10,000 people in
the room, whatever, but then you go take the three months following
the streaming of that online would accumulate far more visitors and
end users than originally. That was already known. But being able
to extend that from the keynote stage out to every session and
being able to figure out how to produce that type of an event in a
very decentralized way is, I think we've learned a lot through that
process.
Ryan Cunningham:
Back to your question about people going to offices and the team
working in places, I think there's a lot of reasons why a lot of
people really value that type of working whether... There's people
on my team who live alone and are really, really craving social
interaction with other humans that are ready to come back. But
there's also people on my team and self included with young kids in
the house and a lot to manage and really craving return to normalcy
and in that type of life environment.
Ryan Cunningham:
So I think work from home, I think we've all learned that we can do
it and some people have learned that it's even better for them, but
I think there's a lot of people who will still value working in a
physical location and I hope we'll return to a good chunk of that
as well.
Steve Mordue:
Yeah. It does get kind of lonely for a lot of folks especially
those social people that need to be around people, need the water
cooler or need to go to lunch.
Ryan Cunningham:
Yep.
Steve Mordue:
That's the best part of what they're doing.
Ryan Cunningham:
Yeah.
Steve Mordue:
Let me ask you about... Maybe I'll get a little self-serving here
now.
Ryan Cunningham:
Sure.
Steve Mordue:
You're familiar with our RapidStart CRM?
Ryan Cunningham:
Yep.
Steve Mordue:
And I'm just curious about what the team internally thinks about
motions like the one we're doing and others are looking at where
we've... And I know you'll be a little biased because you're more
on the platform side as is Charles. Charles is less concerned about
the first party group. They got their own problems to deal with,
but we're basically making a business out of building simpler
versions of what the first party Teams have built for an audience
that isn't prepared for that level of complexity.
Ryan Cunningham:
Yeah.
Steve Mordue:
And we've built it to run on the $10 pass, and we recently made it
free. I'm just curious what the talk in the halls is about ISVs
like us that are basically building products that are attacking
directly. I mean, I'm attacking directly the sales professional for
sure and even enterprise for a lot of customers because you've
given us enough in the platform that I can build quite a bit for a
lot of customers before I'd have to really go to those first party.
What's the talk in the halls about that kind of motions?
Ryan Cunningham:
Well, luckily we don't have any halls anymore, Steve. We're all
working from home.
Steve Mordue:
That's true.
Ryan Cunningham:
Otherwise we're-
Steve Mordue:
In the video halls.
Ryan Cunningham:
[crosstalk 00:36:36] Steve Mordue in every elevator lobby. Look, I
will say a couple things on that. I don't want to speak for
Charles, but from a platform perspective and certainly from my
perspective too. Yes, our day job is focused on building a
platform. Our biggest customer of the first party apps running on
that platform still by revenue at least. We have a lot of incentive
as a Microsoft shareholder and as a member of the business
applications group and seeing the first party apps be successful.
In fact, a lot of our effort and our engineering effort goes into
helping those first-party apps be successful and stay successful
and get modern and get fast and get mobile in addition to or in
some cases around building the core platform itself.
Steve Mordue:
James has said not that long ago that make no mistake, those are
what pay the rent.
Ryan Cunningham:
Yeah, absolutely. Look, Power Apps is driving an incredible amount
of growth from a both a usage and a revenue perspective. But yeah,
I mean there's an established greater than a decade business in CRM
at scale that customers are driving themselves trusting billions of
dollars of business too and paying Microsoft a lot of money for
that privilege, right? So we take that very seriously and we are
directly incented to protect that business whatever that means.
Ryan Cunningham:
Now, that said to rewind earlier in the conversation, we're a
platform company at heart right and it's not just that Steve Mordue
can go out there and build a CRM system on the Dataverse and Power
Apps platform. I mean, we have multiple Power Apps competitors
building on the Azure platform. They're Azure, and that's great as
a shareholder and as a software person. The best solution should
win and that's never going to be a one-size-fits-all answer for
every customer. To your point, there are some customers that are
going to be best served by a certain piece of software and
Microsoft as a builder of generic things is not going to get into
every niche, it's not going to get into every vertical.
Ryan Cunningham:
We want an ecosystem of people to build on the platform and extend
things and even build fully standalone things for those niches,
because we won't get there ourselves and we know that there are
more of them out there where expertise needs to go. For Microsoft
to really have a Microsoft product offering at scale, it needs to
have a really big business behind. It's a really big business
behind it. There's plenty of opportunity in the market at other
multiples that is very profitable for software vendors and very
advantageous for customers that are businesses that Microsoft will
not directly enter.
Ryan Cunningham:
So I think in those worlds if the platform doesn't work for that,
then what's the point of having a platform. It needs to work for
that and we need to make RapidStart successful just like we need to
make the first party Dynamics app successful. I believe those two
things are not at odds with each other and they should live in a
co-existing world.
Ryan Cunningham:
From a customer perspective even as a platform person, a lot of
people will come in and say, "Should I use this off-the-shelf piece
of software or should I build it myself in Power Apps?" My first
answer to them is always if the off-the-shelf thing does what you
needed to do or even does 80% of what you needed to do, it's
usually worth buying. And even if the price tag feels more
expensive, because what you're buying there is a team of people
behind that app who not only put all the effort into making it, but
are going to keep putting effort into making it better.
Ryan Cunningham:
And whether that's Steve's team or whether that's Muhammad Alam's
team that is almost less relevant. The concept is I'm going to buy
a piece of software that people have already figured out a lot of
the hard parts for this use case and they're going to keep making
it better. Now the ability to extend it is really important in
business applications because selling shoes is very different than
selling wind turbines even if it all involves selling stuff.
[crosstalk 00:40:55]
Steve Mordue:
It's one of the reasons we ended up going free. When I first came
up with that idea for RapidStart, we launched it in 2015 and it sat
on top of CRM online the single SKU at the time to just really make
the whole thing simpler because there was that need for something
to be simpler. I had this dream that I was just going to sell that.
People would buy it, pay me every month and leave me the hell
alone. That was what I had imagined. But everybody, everybody wants
to tweak and fiddle and make it unique. We actually look back last
year at our revenue with 10 times more revenue on the services of
helping customers customize our app that we did on the recurring
revenue.
Steve Mordue:
That's the reason we decided, "Well, let's just make the app free
and lean into the services as much," because I really didn't want
to do that. I didn't want to do that business at all. Now, I'm
being you know pulled in or the godfather won't let me out of the
services business. But you're right, everybody needs something
unique. So we really recast them as accelerators as opposed to
here's something you just buy and use. But it's the same even with
the first party apps. Nobody installs a first party app and just
uses it.
Steve Mordue:
They've all got to be molded to fit the business, and I think that
that's the nice thing about the platform whether it's on first
party or just on Power Apps is you've got all the tools to... And
that's actually one of the challenges we run into, I'm sure you
guys do too where they look at some app and they say, "Oh, that's
not exactly what I need," and then they move on, without realizing
that, you know what, that can be exactly what you need and frankly,
with the tools available that we have today, not that expensive,
not anything like it used to be.
Ryan Cunningham:
Supposed than what I need and I can make it to work.
Steve Mordue:
Yeah, and a fraction of what it used to cost to do those kind of
services.
Ryan Cunningham:
Part of making this stuff easier to adopt is about having apps that
are much... At least much closer to what a customer needs out of
the box. They don't have to do a bunch of customization upfront. I
think something that we have been on the journey from, if you go
rewind 10 years in CRM to now is make it less of a giant monolith
make individual modules much more ready to consume. We've done a
lot of work around that. But even within Power Apps, a lot of
people get started by grabbing a template and implementing it and
starting to use it fairly stock and then realizing, "Hey, I want to
put my logo on it and then I want to change this form and then I
want to change the field. And then I want a thing to kick off."
Ryan Cunningham:
Making the customization incremental as opposed to putting a really
large tax and price tag before it's useful is one of the tactics we
pursue to make it easier to get more people started. But that said,
there will always be the need to tailor and customize software in a
business application space. I think one of the trends we are seeing
is this blurring of lines between... We like to pretend classically
that there are ISVs who produce software and put it in the world
and then never touch it.
Ryan Cunningham:
Then there are system integrators who do the dirty work of services
to make it work. Those lines get really blurry in the modern world
where from a classic services provider standpoint when I'm building
and customizing on a platform, it's actually much easier to then
start to templatize and repeat my solutions so I'm not just doing
labor every single time.
Ryan Cunningham:
And to your point from a software maker perspective for customers
who want to constantly customize it, it gets more viable to go the
other direction depending on what your business model is. We see a
lot of people living in that world. We even see customers
themselves, energy companies, healthcare companies building stuff,
financial services companies building stuff for themselves on the
platform and starting to commercialize it to other people in their
industry because it's on a platform that's transferable and that's
something that classically you didn't see with line of business
software.
Ryan Cunningham:
It was built in a vacuum custom and very tailored for one customer
and then it sort of lived in that silo for a long time. But the
ability to make those assets transferable is a huge advantage in
this world.
Steve Mordue:
Back when they really first started pushing the Citizen Developer
motion, I think I wrote a post about the end of SI business. This
is it. We're all dead now. They won't need us anymore. The sky is
falling, Chicken Little. But now as we've seen this thing roll out,
because it is less expensive to get deployed, there are people
building apps and using apps that would never have considered it
before.
Steve Mordue:
So while I would say it's probably true that our average customer
SI project has lost a zero in value, there's 10 times as many of
them. So it's evened itself out. We've got many more customers
available now than when the only way you could become a customer
was if you had really deep pockets and a lot of patience. So we
just opened up the number of potential customers by 10 times even
though the deployment of each has gone down some. I'm not
disappointed.
Ryan Cunningham:
And I think that trend is holding. I mean, I think you see even
some of the big services companies like the big four and stuff like
that actually seeing some very similar trends where they're
building real practices on power platform whereas a couple years
ago, they didn't see it as something for their business model,
maybe even a threat to their business model. Now, they're
realizing, "Look, I can drive real revenue out of this just the
size and dollar amount and number of projects is a different mix
that it was before."
Ryan Cunningham:
In some cases, those tend towards strategic consulting engagements.
It becomes, let me think about helping a... For a large global
organization to wrap their head around how do I use Citizen
Development in my company? How do I keep it secure? How do I
monitor it? Where do I let a business unit roll their own thing
versus where do I bring in a team of professionals to build and
maintain a solution?
Ryan Cunningham:
Even just that decision-making process and the center of excellence
and governance practices that go around it, that's a major
engagement that a lot of customers need help with right now because
they're not organized for that today or resourced for it today. And
then you look at getting into each of those individual projects.
Certainly today, even in a future where apps are 10 times as easy
to build as they are today, if I'm going to go roll out a mission
mission-critical solution for managing customer data and critical
decisions, I need software-minded people to help me think about how
to keep that compliant, about how to build it in a way that humans
are going to want to use it.
Ryan Cunningham:
Just because we put a tool like Photoshop out there in the world,
does not instantly make everybody a photographer and a digital
artist. There's still that mindset and expertise that's going to be
really necessary. So for a lot of a lot of services organizations
right now, I think they're realizing that there is a lot of value
both in the execution of individual apps and projects, but then
also in helping customers adapt to this new world where a lot of
people can build software and you have to make decisions about who
builds what and how you maintain it. [crosstalk 00:48:15]
Steve Mordue:
I think definitely one of the areas that's been blown up completely
is the old ROI story because you used to be looking at a
significant investment to deploy something of time and money, and
the return on that investment was quite some time. That was what
was going to limit the growth of any business application platform
out there was... And now, that's produced almost nothing.
Steve Mordue:
So literally, Bob can go build something that starts generating
revenue or saving money in an afternoon. The ROI, it's not even a
question anymore about a half a day of Bob's time to go and
streamline this process and save us five hours a day with his
four-hour effort.
Ryan Cunningham:
True.
Steve Mordue:
And that didn't exist before. That just did not exist within the
dynamics application before platform, before Power Apps, before
Canvas apps. It's completely changed the entire game.
Ryan Cunningham:
Yeah.
Steve Mordue:
Before I let you go, what of the things as you look across the
landscape right now and maybe the things that are coming up that
have been discussed that people are aware of, what excites you the
most? What do you think is... Two things. What are you the most
excited about? And the other one is what do you think more
customers would be excited about if they understood it better or
realized that that's the most underutilized high value thing that
people are just missing?
Ryan Cunningham:
Sure. Those are big questions. I think there's a lot that I get
excited about. For people that know me, it's not hard to get
excited.
Steve Mordue:
Yeah. You're excited about that lamp in the background, I know.
Ryan Cunningham:
Exactly. It's a great lamp. It's not. It's a crappy lamp from Ikea.
Look, I think for me certainly there's a ton of work in our feature
backlog that's really cool and really exciting and there's a lot of
work particularly around bringing intelligence to the authoring
experience that I'm pretty excited about. To the earlier
conversation we're having about make it easier for people to be
successful and maybe not have to deal with that formula bar,
there's a lot of cool stuff that we're starting to apply.
Ryan Cunningham:
We've brought AI builder to end user apps, but actually bringing
that to the maker experience of being just... And not in magical
unicorn pixie dust ways, but just in really practical ways
suggesting ways for people to do things, suggesting things to do
next, making it possible to write logic in natural language as
opposed to having to know all the ins and outs of the formula for
example. There's some really cool stuff cooking there that I think
will start to continue to open up orders of magnitude of humans who
can be successful.
Steve Mordue:
Move that bar farther down the path.
Ryan Cunningham:
Absolutely, right? Classically, sometimes we think about those as
tools just for true amateurs. But if you go look at even all the
productivity that a product like visual studio has brought to
professional developers, it's in stuff like Typeahead and linting
and all that. It's really about bringing micro intelligence to
those micro interactions that a person who's living in this tool
for eight hours a day, all day long is going to need to be really
productive.
Ryan Cunningham:
So we're really thinking about that both ways. So those things are
exciting. I think if you zoom out a little bit though beyond the
individual level of feature work, I would say, what's most exciting
to me and what I hope is getting more exciting to more customers is
less about any one individual feature or product and more about
what's possible when you start to combine them at scale.
Ryan Cunningham:
I think that's where, if you look at organizations that have really
gone all in on Citizen Development and low code for professionals
as well and start to work together, you see this new way of working
where you have professionals and amateurs and IT people and
business people knowing each other and working side by side in a
place where they traditionally were opposed to each other. Or at
least just not aware of each other. And that's where you get not
just one cool app with one cool feature, but literally thousands of
applications inside of organizations that are just creating a crazy
amount of value and you start to change you start to change the
lives of people in those organizations.
Ryan Cunningham:
Both the people that are able to implement that stuff, but also you
just make the jobs better for the people who get to use stuff that
was built by their company and was built much faster. That's
ultimately super exciting to me is to start to see this making a
real change in the way that humans are working and doing it through
a mix of apps and bots and automations, and Teams experiences.
Ryan Cunningham:
It's when those things sort of work together in concert that I
think they get most exciting. So I'm thrilled to see that
happening. I'm really excited about this end-to-end stack of what
customers have done with Azure resources through power platform, in
Teams and how that has created a meaningful dent and how a company
works. I'm super excited about all the work we're doing to make
that smoother to actually implement and manage and deploy, but I
really hope customers see beyond the one use case, see beyond the
one app or see beyond the one product and see what's possible when
I start to change the economics of how software is rolled out in my
company. And by economics, I mean not just-
Steve Mordue:
It is a discovery process.
Ryan Cunningham:
... who participates. Right, yeah.
Steve Mordue:
It is a discovery process. They stumble upon something. They start
using something and if they're successful with it, then they start
discovering these other pieces around it that are available around
it to extend on it. I don't think the technology itself right now
that we have is a blocker to growth. I think the biggest challenge
with growth right now probably relies more on the complexity of the
licensing side. I mean, there's a lot of customers-
Ryan Cunningham:
I mean, I think there's good parts of it.
Steve Mordue:
... that can't even get started because they don't understand what
they even need or how to buy especially in the Power Apps store
where they've got some seated Power Apps capabilities, they don't
know what word seated even means or that they have it, and then
they're seeing all these cool Power Apps things and they can't
figure out how do I get from here to there? Why can't I do this and
that? I think that probably is a bigger blocker to potential growth
than the technology itself.
Ryan Cunningham:
Maybe. I would say certainly-
Steve Mordue:
Have you read the licensing guide?
Ryan Cunningham:
It's my favorite James Joyce story.
Steve Mordue:
I'll bet. Well, most customers haven't and wouldn't.
Ryan Cunningham:
Well, I guess what I would maybe zoom out from that, I would say...
You're right. The technology itself can solve a lot of problems for
a lot of different people and we have existence proof of that.
Getting an organization at scale to discover it to see it in that
light and then to have an organizational culture embrace it.
Certainly licensing is a part of that, but it's also about who in
IT is responsible for it? How do we govern it? Where do we roll it
out? Who is footing the bill when I do understand how to pay for
it?
Ryan Cunningham:
At the end of the day, licensing is actually very simple which I
know is a controversial opinion. You get a measure of it in Office.
For extending Office, you pay for Enterprise data sources. There's
two ways to pay. You pay per app or you pay unlimited, full stop.
That's the license. Now, we do not do ourselves many favors when we
have classically rolled that out. And I absolutely take your point
that we have made the communication of that complex.
Ryan Cunningham:
And for a lot of customers, this is not a commodity expectation.
We're at a point right now where everybody needs an email account
and a productivity suite and Word processing and every seller needs
a CRM license and those things are not necessarily controversial,
it just becomes about what's the best price from the best vendor.
Because they're mature products in mature markets.
Ryan Cunningham:
Low code is at a very different state of market maturity. So for a
lot of people it's about not just understanding how our pricing is
structured, but understanding organizationally for them how do they
conceptualize ROI? How does the market offer these products and how
do I evaluate that potential expense against the value I'm going to
get out of it? I think in addition to making things like the
licensing guide easier to read for people who do not have PhDs, I
think it's also really about helping the market get more mature and
seeing... We really genuinely believe this will become an
expectation of organizations.
Ryan Cunningham:
If you go fast forward another couple years, if I can't rapidly
innovate internally and I am dependent on a team of professionals
to start from scratch every single time that I that I need a
problem solved, that's going to be a major competitive disadvantage
for organizations. And on the flip side, being able to have every
information worker be able to do at least basic tasks extending
their software and solving their own problems is increasingly going
to be an expectation.
Ryan Cunningham:
We're not there yet from a market maturity standpoint. Not
everybody sees it that way, but we've certainly seen enough proof
of organizations already evolving to that point that we know that
that's coming. So I think being able to get to that place is a
journey for a lot of companies. It's then really the next phase for
us of bringing the world to where we know it can be.
Steve Mordue:
I mean, you just look at some of the things in the past like the
first Obamacare website debacle with all the millions of dollars
they spent to basically build a website and then look at what it
would have taken for somebody to pop that up on portals today. I
mean, there's no compare. I mean, we've actually lost projects in
the past because the people thought we didn't understand the scope
because we were like 10% of what the other companies... So we
clearly misunderstood the scope and they just misunderstood the
value of a platform and what that does to a development cost and
time cycle and everything.
Ryan Cunningham:
There are government entities that rolled out COVID testing
solutions on Power Platform in literally weeks to tens of millions
of citizens and had that go off without any major hiccup. You're
right. We get back to that pressure test. It's like getting that to
go to scale and to help more people see it that way and be able to
expect that from their software. That's really the next mountain to
climb.
Steve Mordue:
I think the two challenges we've had around licensing are that
Power Apps versus Power Apps. We've got these two products that
really are our different products that share the same name and that
puts some confusion in customers where they think they already have
Power Apps.
Ryan Cunningham:
Have it right.
Steve Mordue:
They don't understand why they have to go buy Power Apps or they
have Power Apps. And the other one is the passes, the per user or
the per app passes. Those are assigned in a different way than all
the other licenses they have been using internally for years. It's
the only thing that's assigned that way. So it's a different
process and they're looking at how do I do this? I've assigned
licenses all the time. I don't understand how to do this.
Steve Mordue:
Those are two spots if you could personally take as a favor to me,
go clean up the pathways [crosstalk 00:59:39] on those to make that
as smooth as possible for people to understand, that would be that
would be awesome.
Ryan Cunningham:
And that feedback is well heard across the market. I mean, we are
at the pace that we were trying to do some work on the first
problem to clarify really Power Apps for Office from our apps for
stand-alone. And then separately the per app concept is a really
powerful concept and actually a lot of organizations have embraced
it. I don't know if I'm allowed to say this. there's more monthly
active usage of apps on a per app license today and this has been
true for many months than there were on either the older two
licensed models, right?
Steve Mordue:
Sure.
Ryan Cunningham:
I mean it hunts for a lot of people when they can realize, "Oh,
hey. This is a way for me to apply the value of the platform to a
use case without having to go have this broader discussion about
committing the entire organization to an unlimited number of
apps."
Steve Mordue:
And just a difference of cost
Ryan Cunningham:
It's a different concept for people.
Steve Mordue:
And just a difference of cost. At $40, I can afford to have 10
people use this.
Ryan Cunningham:
Right.
Steve Mordue:
At $10, well I can afford to have 40 people use this. So suddenly,
strictly related to cost, you're going to see that usage explode on
those lower cost licenses because those are people now using an app
that weren't going to be able to use it before. They weren't going
to justify the expense for that level, that tier if you will. You
start getting into 10 bucks, I mean that's pretty much anybody in
the organization you could justify 10 bucks for. Now suddenly,
everybody has an app.
Ryan Cunningham:
Yup. We've seen a number of customers already even though this has
been in market only about a year. Start there and then very quickly
realize, actually we want unlimited [inaudible 01:01:25] people
through the transition is a phase as well.
Steve Mordue:
This is something that you take in account as a builder of apps
also if you're wanting to try and build for that, you build your
apps understanding the licensing structure and you design for it.
So listen, Ryan, I appreciate you taking this time out of your,
obviously not busy afternoon.
Ryan Cunningham:
[inaudible 01:01:50]
Steve Mordue:
A rare not busy afternoon for you, I'm sure. I'm feeling very lucky
to have caught you when I did.
Ryan Cunningham:
Sure.
Steve Mordue:
Any closing thoughts?
Ryan Cunningham:
Hey, keep doing what you're doing, Steve both being a rock in the
community and also pushing us on the platform to make it better. I
think ultimately we see this as a thing we're doing together and I
mean that really genuinely. We don't sit in an ivory tower.
[inaudible 01:02:18] When we do, we make plenty of blunders, but I
think this thing we are building is bigger than lines of code. It's
a mindset and I think the more that the community embraces it, the
faster we go. So I really appreciate you and everybody that is
hopefully going to listen to this someday and participate.
Steve Mordue:
There'll be thousands listening. There usually are. So don't
worry.
Ryan Cunningham:
Yeah, 100%. Thanks for the call, Steve.
Steve Mordue:
All right. Cool, man. Talk to you later.
Ryan Cunningham:
Be well, peace.