The Low Code Wave: The Time is Now

The Low Code Wave in the context of the history of enterprise software

The low-code market continues to be a hot center in enterprise software. Amazon is the latest of the tech mega-vendors to toss its hat into the ring. Venture funding and startup interest remains high. Increasingly, analysts and thought leaders point out that as companies seek to adapt, the speed and agility that low code provides is a needed part of the solution.

This heady optimism is all the more notable, given the reality that in addition to a pandemic, we are in the early days of a recession, the third of the twenty-first century. As an executive seeking insight on what these uncertain times will bring for the future of our industry, I sought to assess and learn from the past recessions of 2001 and 2008 to see what that might suggest on what the future might hold. Based on reflections on past recessions and their impacts on enterprise software trends, my basic thesis is that the current situation creates a strong mid-term market opportunity around the low code market.

Recessions: a mother of invention

Having lived and worked through both of the prior recessions, it seemed as though there were similar patterns in both. First and foremost, in each IT had an imperative to cut costs and “do more with less.” This imperative compressed IT spending and budgets. But what is interesting to observe is that in each, enterprises had to adapt in interesting ways to achieve this goal. In both past recessions, necessity was the mother of invention.

2001 — Server Consolidation: Increase hardware utilization and reduce costs

In 2001, the Dot-Com crash followed later in the year by September 11, led to the first recession I worked through. From an enterprise IT landscape point of view, we were still pre-cloud — Salesforce was a 2 year old startup and Amazon Web Services was still about 5 years in the future. Client-server was the dominant paradigm, and that meant that enterprise IT had a hardware estate of servers, storage arrays, networking devices and desktop clients to manage.

When the 2001 recession hit, and IT staff scrambled to cut costs, they quickly honed in on a very prevalent and costly IT problem: underutilized server hardware. It was well known that most servers in an enterprise were dramatically underutilized — it was common to hear that CPU utilization was around 10% across the vast bulk of servers in an enterprise’s IT estate. If IT could find a safe and efficient way to raise the utilization of servers to say 40%, this would drastically reduce the server hardware footprint you needed. Thus was born the quest and trend of server consolidation.

To achieve this goal of server consolidation, you needed a technology to safely and efficiently pack more stuff onto a server. You needed something that would let you carve up that unused capacity so that you could safely pack and run different applications and services on one server. This technical something was the Virtual Machine, which VMware was the innovator on, launching its first hypervisor, ESX Server 1.5 in 2002. VMware arrived on the scene at exactly the right time, solving the right problem — help IT cut costs by enabling server consolidation. Fewer physical server boxes, higher utilization of servers, costs cut. VMware was acquired in 2004 by EMC for $635M. (In retrospect, this seems extremely cheap! Particularly now that VMware, post spinoff from Dell-EMC, is trading publicly at a market cap of roughly $60B.)

2008 — Cloud & Mobile offer new cost and innovation models

In the Great Recession of 2008, enterprise software and IT was going through a vastly more dynamic time. SaaS was on the scene, with the growth of Salesforce most notably. Amazon Web Services, while very early given its 2006 launch, was turning heads but still quite early in terms of enterprise adoption. And the Apple iPhone had exploded onto the scene in mid-2007.

As IT staff worked to adapt to the Great Recession, SaaS and Public Cloud both offered powerful ‘do more with less’ value propositions. Specifically, they introduced compelling pay-as-you-go and utilization-based pricing in a manner that was completely antithetical to traditional large enterprise software and system contracts.

Enterprises seeking to save money wondered why, for example, they should spend several million dollars buying a petabytes of storage for their datacenter that would take years to fill up, when Amazon would just rent out storage on their very low cost infrastructure. The cost pressures that the 2008 Recession exerted on IT, accelerated the needed shift from fixed capital expenses to the pay-as-you-use models of SaaS and Cloud, and AWS and Salesforce in particular benefited.

In addition, with the rise of Cloud coupled Mobile, enterprises had to go beyond simply cutting costs — they had to adopt new technical practices and processes — microservices, agile, CI/CD, infrastructure as code, design thinking, etc. all arose out of the move to cloud and mobile. These trends were transformational, and their growth and impact continues to today.

2020 — Low Code: Add digital capacity without adding developers to lower costs and drive operational innovation

This brings us to today. The Covid-19 Pandemic and the recession it catalyzed are interdependent, and they are putting unique demands on business. Yes, there is a pressure to cut costs and save capital, but there are also vital investments needed in how organizations plan to get back to work, serving employees and stakeholders safely. In addition, the imperatives around speed, details and connections are more important now than ever. These various demands — helping organizations quickly and with details track and establish short- and long-term digital workflows to adapt fast — are acute, and there is not substantial new investment available to add developers to adapt. Low code platforms, such as Quick Base, are ideally suited to help organizations adapt, quickly and economically.

Quick Base customers, for example, are reporting to us standing up and rolling out all manner of software applications to address specific needs and requirements that they have in seeking to adapt to getting back to the future of work. Safety and compliance tracking, resource planning, public safety outreach are just a very small sample of what we see customers doing across our base. They are building and deploying these apps in days and weeks, using existing resources.

As we talk to these customers, it is apparent that they see a changed world for their organization — not just now and adapting to the needs of the day. There is a need for operational agility in their organization is an imperative they will pick up and add in the years to come. Based on this pattern we have seen, low-code is primed to be the next technology solution for the recession we may experience post Covid-19, making companies more agile and stronger to move forward.