Let’s dig deeper. Let me them what I really think and what they should do to become part of the solution rather than part of the problem. While Oracle, SAP and Microsoft are of course on the list of usual suspects, there are many other enterprise software vendors – like IBM and CA – that also need to pay attention to the trends about to flatten them.

First and foremost, enterprise software vendors, acknowledge that the world has changed and will continue to change regardless of what you think should happen or what you want to happen. You are no longer controlling this playing field. You have two broad choices: dig your heels in and try to squeeze the last pennies out of antiquated software licensing models or embrace the changes so enthusiastically that you begin to lead the software delivery revolution – which you have, incredibly, begun to cede to upstarts like Salesforce.com. I realize that this is tough: enterprise software vendors need to admit change – not failure – but they need to do it proactively, aggressively, cooperatively and, yes, enthusiastically.

We are at the end of the CAPEX technology era. Deep investments in hardware and software are coming to an end. Listen up software vendors: a ton of CIOs and CTOs are past weary about maintenance and upgrade fees. Every year more and more technology buyers would like to expense their technology investments annually rather than spread their cost over many years.

We are at the end of the proprietary software life cycle. CIOs know it; CTOs know and even CFOs know it. It’s a new world in a new era. Pass it on.

You all need to go somewhere to work all this out. Here’s what a summit should yield:

A commitment to rapidly evolve your business model

away from CAPEX-driven enterprise software licensing to

alternative delivery models

Invest in software-as-a-service – not on a token basis but

in a leadership capacity, directly challenging the business

models of the SaaS vendors: why should they own this

delivery model? Have you lost you minds? Why let them

own this space? Are you still not sure the world is

changing? Do you still think off-shore drilling will solve

our energy problems?

Proactively work with your clients to offer them migration

paths to hosted, pay-by-the-drink delivery models. I

realize that this is heresy, but wouldn’t you rather lead

them somewhere than chase them later?

Build templates for migrating from internally hosted

applications to externally hosted ones. These

pre-packaged configuration management tools would go a

ong way toward building your credibility and keeping your

customers happy (and just plain keeping them).

Embrace open source software. Sure, it’s the anti-Christ

but it’s also the future. We all know that there will actually

be proprietary open source flavors but the

interoperability of these hybrids will be vastly superior to

what we have today. You all need to think about becoming

the Red Hats of your industry.

Publish all of the APIs you have – and support them. Make

sure that they’re clean and secure and update them on a

regular basis. Give them away free with a smile – and keep

them coming.

Redefine your relationship with your clients as partners –

not adversaries. If you think you’re welcome in most

enterprises then you probably thought US troops would be

greeted as liberators by the Iraqis. As you know all too

well (perhaps after a few necessary glasses of wine) many

of your clients really hate the vice you keep them in. The

do not see you as a partner or a friend; they see you as

someone trying to squeeze as many dollars as possible

from their shrinking technology budgets. You really need

to turn this around – and fast, lest you lose more and more

of your long-suffering clients to alternative software

delivery models.

The real challenge is the reinvention of your business while you simultaneously cannibalize the business model that made you billions of dollars over the past few decades. I know, I know, it’s hard to do these kinds of things, but, trust me, the clock is ticking. If you fiddle too much longer, you will trip into a free fall that will cost you billions over the next few decades.