Core vs. context is a critical concept to think through when figuring out what people will rebuild themselves with AI. Companies bring in “core” functions that differentiate them. This is what their core product or service is, how they sell to customers, things that drive their culture, and so on. Conversely, they outsource the “context” that is table stakes to get right, but only offers downside in getting wrong. An easy rule of thumb to think through is would a customer ever notice if the company did that function directly themselves or not. Enterprise software is almost always “context”. These are areas like their CRM or HR systems, infrastructure, data management, and so on. These are necessary to operate a business at scale, but rarely are you advantaged in trying to roll your own. Only a few exceptions exist, and it’s almost always because you need a solution to serve your “core” that no vendor offers (like if you needed custom software for a vertically integrated supply chain). No matter how a company starts, they eventually almost always separate work and value between core vs. context over time. It’s the only way they can stay competitive and eventually allocate resources to the optimal areas. So even if a company *could* rewrite their enterprise software with AI, they basically just wouldn’t. The version updates, security, regulatory features, bugs, SLAs, the professional services necessary, etc. just all would make it ROI negative. As bucco points out, the real risk is better versions of these tools that are AI-first. That’s what to watch out for from a disruption standpoint.
BuccoCapital Bloke
BuccoCapital Bloke21 tuntia sitten
I think the risk that companies build their own systems of record - ERP, ITSM, CRM etc - is incredibly low Companies are not stupid. They have no competence here, the stakes are massively high, and regardless of how easy it is, they would still have maintain and optimize it, which is, ultimately, a distraction from their actual business. Same reason AWS, Azure and GCP are such incredible businesses I genuinely think the people who believe this have either never worked in a real business or simply live in spreadsheets with no understand of how enterprise software is bought and sold I do, however, think the risk of the legacy SaaS providers being beaten by AI-native competitors from below is much higher Figma ate Adobe’s lunch because collaboration was native to the cloud and Adobe couldn’t adapt. That’s the sort of risk that should be keep these legacy systems of record up at night, not people vibe-coding a replacement.
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