Enterprise Archives - Page 4 Of 9

Frenemies IBM and Apple Team Up to Shake Up the Enterprise Mobility Space | Sherpas in Blue Shirts

July 21, 2014

On 15 July, 2014, IBM and Apple announced a sweeping enterprise mobility-focused partnership to create business apps and sell iPhones and iPads to Big Blue’s corporate customers, thereby bringing IBM’s big data and analytics capabilities to the iOS ecosystem. The venture includes more than 100 industry-specific enterprise solutions, including native apps developed for the iPhone and iPad, targeted at the retail, healthcare, banking, travel, telecommunications, and insurance verticals. IBM will leverage its 3,000 mobile experts and industry/domain consultants, to provide cloud services and onsite support for enterprises. The two companies will collaborate on IBM’s MobileFirst for iOS solutions, combining their distinctive strengths – IBM’s big data and analytics capabilities and Apple’s consumer experience and developer platform.

The Rationales Behind the Partnership

The intention of the deal for Apple is to enable its products to become go-to-offers for large enterprises. It also principally underlines the company’s immediate need to expand its presence in the enterprise world, as consumer sales peak and competitive intensity in its core market heightens. Meanwhile, IBM hopes Apple’s mojo can help revitalize its fortunes after nine consecutive quarters of year-on-year revenue decline, as it places its bets on mobility in the workplace. It will also help IBM solve its big data and analytics growth issues (i.e., providing Watson with much needed impetus through enhanced mobile users’ data), forming a pivotal part of a new growth story. (To this point…think back three decades to Apple’s iconic television commercial titled “1984,” when it attacked IBM as an evil Big Brother figure. Talk about a 180-degree turnaround!) iPhones and iPads are already owned by employees in large enterprises but are hard to manage and govern. IBM can leverage its enterprise-wide system management expertise to make a compelling value proposition, complementing its Fiberlink acquisition (a provider of cloud-based enterprise mobile management solutions). Additionally, it will help IBM cement its reputation as a leader in the “mobile first” movement in enterprise solutions.

Implications for Rivals

Microsoft will feel most uneasy about this alliance, as while its products are ubiquitous in corporate PCs, it has been a laggard in serving the mobile workforce. This is a critical whitespace its new chief, Satya Nadella, is determined to fix. Google, Samsung, and the Android bandwagon will also feel threatened, given their recent push in the enterprise market. To allay fears about Android’s security for enterprise use, Samsung has built a system called Knox into its devices. Last month at its developer conference, Google announced that it would embed software elements of Knox in the next version of Android. They will also have to look at alliances with other enterprise-focused vendors to shore up their business case. Also, if IBM becomes the de facto champion for iOS, it will have potential ramifications for other service providers such as Dell, HP, and CompuCom.

Multi-faceted Challenges

Apple has not targeted enterprises with any zeal in the past. Steve Jobs was infamous for his contempt for selling to enterprises, even referring to CIOs as chief information “orifices.” While the Tim Cook era has seen Apple making small but significant progress in courting corporate stakeholders, IBM’s significant experience in the space makes Apple/IBM a very unlikely pairing. Apple and IBM have drastically different people cultures. Any effective partnership will need to account for these differences. They also have very different go-to-market and channel strategies, which will result in friction over the direction the alliance takes. Their sales motions tend to be at odds, with IBM solutioning for a client, while Apple caters to essentially product categories. IBM has defocused severely from the end-user computing space. Does this alliance signal a revival in this regard? The companies’ divergent investment attitudes will make joint investments problematic. To complicate matters further, both have stark but strongly held philosophies about design, customer support, and sales, making collaboration painful.

The Road Ahead

Partnerships and alliances such as this are notoriously difficult to manage. Both organizations will find it challenging to bring two entirely different culture sets to work cohesively as one. The alliance will need sustained resources, time, and senior leadership investments, along with a steadfast commitment to change management. Given the complicated dynamics sweeping the enterprise market, IBM and Apple have certainly stolen a march over rivals. We will need to keep an eye on the investments both are making into the alliance, the steps they are taking to mitigate the challenges, and the success stories that emerge as a result.

One thing is certain. The enterprise IT market is in for some interesting times. For further insight into the enterprise mobility space, check out our recently published viewpoint.

Social Analytics and an iPad to Chop Veggies | Sherpas in Blue Shirts

July 17, 2014

I recently watched a WhatsApp video in which a woman was visibly pleased when her advanced-age father said her gift of an iPad was “great,” then became baffled and shocked when she saw him using it as a vegetable cutting board!

While this is certainly an extreme example of something being used for a different purpose than its intent, we’re seeing the same type of disconnect with social media platforms and the associated analytics. Lots of organizations have deployed social analytics tool to assess the typical engagement metrics (e.g., number of users reached, time spent per user), beauty metrics (e.g., hashtagged or liked), or perspective metrics (e.g., positive or negative sentiments). Much like the iPad veggie chopper man, these enterprises believe the solution is doing its job well. However, like the daughter knew, this is not what social analytics platforms are made for.

Social analytics platforms should be deployed to generate value beyond tracking customer portal trawls. They are meant to listen to, engage, and amaze customers and prospects. However, very few organizations use them for those purposes. Hardly any of them have integrated social data with the main customer data bank. Moreover, there is little collaboration or coordination across social media, analytics, and sales teams, each instead working in its silo. Why is that? Although enterprises may give different excuses, I see four main reasons per my market interactions:

Organizational challenges in terms of structure and complexity that no business manager wants to disrupt
Lack of forceful evangelization
Limited understanding of how to leverage social media and analytics
Deployment of social media and analytics for “buzz purposes,” rather than as something meaningful

In various organizations, the entrenched old school senior management fundamentally does not believe in “new age toys” of social media. Many of them admit that social media is good to impress the CEO and tick mark their key performance indicators, but not good enough to drive meaningful business. This reluctance results in half-hearted strategies with little focus or commitment.

These reluctant organizations, however, have a very potent argument. They believe there are limited, if any, successful adoptions of analytics solutions that have resulted in revenue enhancement. While they think that analytics may help in running operations more efficiently, reducing costs, and enhancing their brand, they consider its direct impact on revenue to be weak.

Responsibility for this misperception falls both on technology providers and the buyers of analytics solutions, more with the providers. They publicize client adoption focusing on cost savings than revenue enablement. This diminishes the real value a business can derive from analytics adoption. And there are indeed organizations actively deploying social analytics to generate insights, serve the customer, and build the next product, many of which now have a Chief Data Officer overseeing the adoption of analytics solution.

How can an enterprise become truly social? Can it align the wide range of business units – including procurement, HR, finance, sales and marketing, product development, customer support, and quality management – to become social? Can it embed the philosophy behind social initiatives into its business processes? While the challenges are significant, this is where the value from social media initiatives lies. Silo-driven deployments will only add to the fragmentation, instead of helping the business.

Is your company using an iPad to chop its vegetables? Our readers would enjoy hearing your social media experiences.

Digital Enterprise Iceberg | Sherpas in Blue Shirts

July 9, 2014

We all understand the power of digital — it enables us to change the way we interact with our customers, employees, vendors and governments. Getting interactions right with those stakeholder groups gives us powerful strategic advantages. However, the digital world is like an iceberg, and we tend to see only the tip. Below the water is a mass of ice that can sink digital outcomes just as it sunk the Titanic.

Companies that can change their stakeholder conversations in a meaningful way can change the game, changing the competitive landscape almost overnight, reaping enormous wealth. Wal-Mart and Interstate Battery achieved this outcome when they changed their supply chains. And Amazon, Google and H&R Block completely changed the game in their markets.

So what’s the problem?

The business stakeholders see the tip of the iceberg. But the CIOs recognize that 90 percent of the expenses are below the surface and initially can’t be seen.

What we’re finding at Everest Group is that when companies switch to the digital world — such as creating a mobile app as a new way of communicating with Millennials about insurance offerings — there are huge pull-through implications on the rest of the organization.

For example, the company’s vendor systems may not be set up to interface to the new mobile app. Sure, the digital product enables the company to be able to spot new customers as they emerge. But the company needs to change its organizational systems to move into this instantaneous world so that the company can react quickly enough to take advantage of these opportunities or operate in a way that is digitally friendly in this new world.

We’ve all been through the experiences of the impact of the portion of iceberg under the water … such as the half promise when we’ve visited a website or used a mobile app to find we can only go part of the way. We get frustrated when the promise isn’t fulfilled.

As the figure above illustrates, many companies find a huge body of work that is not obvious when they start down the digital path. Although it looks like the cost and time required for launching a mobile app is small, the cost of getting to a great customer experience is high because it often requires huge amounts of infrastructure, application changes and organizational change to live in the new world.

In addition to the cost and time, there are other business risks in the iceberg portion below the water. And aligning the organization so it can operate at digital time requires significant effort and change management tactics. We tend to operate from committees. But in the digital world, that takes too long; it must be instantaneous.

Finally, providers need to venture into this new digital world while they still maintain the old world, thus increasing their investments in services capabilities. There are significant costs involved in dealing with the risks in the part of the iceberg hidden under the water.

Snowflakes in the Global Services World | Sherpas in Blue Shirts

June 24, 2014

There is increasing skepticism and cynicism in the customer ranks in the hyper-competitive environment of the services world. As a customer commented to me, “Providers are like snowflakes. They all think they are unique, but they look just like everybody else. And if you put them under pressure, they all become the same thing.”

The customer was referring to being bombarded with providers’ offers in PowerPoint presentations and the fact that many of the presentations are “paper thin and aspirational.”

Providers come in with the latest hot topic (especially digital, cloud or cloud orchestration) or what they’ve heard at a conference, spinning that into a PowerPoint presentation. But, as the customer explained, it very quickly becomes apparent that the provider has no real experience or only limited experience in the service touted in the presentation. At best there are one or two examples of having done something similar. The offer is more PowerPoint than reality.

There is another problem with these thin PowerPoint offers. These presentations are all about the provider — how smart it is, how capable it is and the complications involved in the provider delivering the service. But this information is of limited interest to the customer, who wants to talk about their own business issues.

The offer overload showing thin experience results in customers’ increasing cynicism. And the focus on the provider creates further barriers for good conversations. Adding to the negative impression, providers usually offer these aspirational PowerPoint multiple times; but essentially, this accomplishes only one outcome: it reduces the customer’s willingness to entertain new offers.

Photo credit: Andrew Magill

Accenture Goes for More Analytics | Sherpas in Blue Shirts

June 13, 2014

Earlier this week, Accenture announced that it has acquired PureApps, a UK-based specialist in Oracle-based Enterprise Performance Management (EPM). PureApps enables clients to analyze financial data to gain insights into corporate performance, to measure and improve organizational effectiveness, and alignment to strategy. PureApps enhances Accenture’s capabilities for services to the CFO, and enhances its consultancy services in the UK and Europe and global shared services offering. This is good timing by Accenture when many large organizations are looking to get increased visibility into their financial performance.

PureApps is to be integrated into Accenture’s Finance and Enterprise Performance practice, part of Accenture Strategy. The acquisition fits into Accenture’s focus on increasing its analytics capabilities through acquisitions.

Another recent example of this strategy is the acquisition of i4C, announced on 30 April 2014. Italy-based i4C is a provider of advanced analytics applications (AAAs), turn-key industry- and function-specific solutions. The i4C ACE platform allows analytics to be built and integrated into workflow without the need to do any coding. It uses industry specific logic and maps business processes into the application with configuration tools. Its portfolio includes some applications for energy, finance, retail, manufacturing, and telco sectors and a set of other applications, such as predictive asset maintenance tools.

Everest Group estimates that the market for analytics BPS, alone, is set for 30% CAGR to 2015. Accenture has made steady investment in its analytic capabilities over the years but the most recent acquisitions, those of PureApps and i4C, in quick succession show that the service provider is positioning for the predicted growth in demand for analytics. It is also filling the gaps in its portfolio by adding different flavors of analytics (e.g., EPM and predictive analytics) to its existing capabilities such as customer analytics.

Why Hasn’t Cloud Had a Bigger Disruption on the Services Industry? | Sherpas in Blue Shirts

June 10, 2014

If you read the technology news in the press and social media sites, it’s apparent that we’re in the midst of a big sea of change in which the as-a-Service and public cloud models are transforming the services industry. HP and IBM’s travails and Oracle’s slowdown are laid at the feet of the SaaS providers. But when you pile all the current cloud activity together, it amounts to a hill of beans, not a mountain. Why aren’t we seeing evidence that disruption from these models is happening on a significant scale?

The buzz

In the famous words of an American hamburger TV commercial several years ago: “Where’s the beef?” Everyone is talking about big agendas to rework workload portfolios and making big efforts to to do that. Yes, Accenture has invested well over $1 billion around cloud and several Indian providers have invested $100+ million a year in mobility and cloud work. And the HCL-CSC alliance is predicated on the fact that there will be a huge cloud sandwich for which they want to position themselves.

If you give providers half a moment, they’ll wax with great eloquence and excitement about the prospects for the cloud model as a high-growth area in services. But if cloud disruption is coming to the services industry, it must be walking; it sure isn’t running.

Where are the billion-dollar practices that do cloud? Why don’t we see service providers launching entire new practices or start-ups reworking applications so they work in the cloud? Who is doing all the work?

The reality

The answer to the above questions is that disruption to service providers is happening occasionally but not en mass.

It reminds me of a conversation I overheard around the impending revolution about self-driving cars. Supposedly a Google executive was saying that it’s not likely that new self-driving car will come on the market and people will buy them when they arrive. Instead, he believes the more likely scenario is that we’ll find ourselves using cars that park themselves and then over time become incrementally more capable and eventually driving themselves. But we won’t have gone through that aha moment where we went out to buy a self-driving car.

I think the same thing is happening with cloud disruption. There just doesn’t seem to be a lot of evidence that companies are driving huge transformations to the cloud right now. Maybe it’s a timing issue in which CIOs and large enterprises will become comfortable enough with the technology that they’ll move en mass to rework their ecosystems to embrace this model. But maybe they won’t embrace it like this and, instead, the industry will wake up one day and find that we’ve incrementally adopted SaaS, public cloud and private cloud.

Perhaps the tide bringing cloud disruption is coming in slowly rather than in as a tsunami. What do you think?

HP – In the MooD for F&A Visibility | Sherpas in Blue Shirts

June 5, 2014

I recently had a briefing with HP Enterprise Services about HP BPO Flight Deck, a visual F&A performance monitoring and reporting tool focused on processes such as order to cash, source to pay and record to report. The flight deck is based on MooD software, which produces visual performance reports based on an enterprise business model that is built to reflect the client’s organization. This typically includes interrelationships between components and processes. HP is offering the tool as part of its BPO proposition in every deal, to engage with clients on transforming processes from the earliest stages of a procurement cycle.

The intention is to help clients increase visibility of F&A performance across the organization to manage operations better and to help with achieving business outcomes. Views can include specific initiatives such as electronic invoicing or dynamic settlements. HP also highlights the application in multi-sourced outsourcing deals, with HP BPO Flight Deck used to measure and monitor service provider performance as well as outcomes and issues. Other features include trending information and scenario-based planning capabilities, e.g., what would be the knock-on effect on processes if certain factors were altered.

This tool could potentially addresses the kind of F&A issues that Everest Group’s buy-side clients often highlight to us, including:

The need to get a broader and yet in-depth view of what is going on in the organization, what is broken and what needs changing
To get clarity and identify choices that support the organizational vision, strategy, framework, scope and approach
How plans are progressing and if an implementation or new F&A initiative is meeting its objectives

Getting that end-to-end view of processes is not easy though. One of the biggest challenges that organizations face is getting their data in order. Data challenges typically include:

Data from disparate systems having different definitions and formats making it difficult to compare and contrast information
Poor data quality – data that is simply not maintained, out of date and/or erroneous

HP and MooD have worked together to address some of the typical data integration issues that organization face when seeking this kind of end-to-end view of operations. The offering includes pre-built data dictionaries, templates and ready-built connectors for major enterprise systems and their reports.

Deployment can be done by degrees starting from a consulting engagement to map out the enterprise business model, and data taken for a sub-set of processes. A hosted proof of concept can be built, if required, before the full deployment is taken live in the client’s production environment. The software can also deal with data quality issues as part of its extract, transform and load (ETL) processes which include automated checks and fixes for standard types of issues, such as different date formats or typing errors in standard terms.

With HP BPO Flight Deck, HP aims to address many of the data challenges that organizations face when going for global process views but at the end of the day, organizations still have to get their data practices in order to be able to make the most of such tools. That said, in these days of intense global competition in business, there are strong drivers, such as year-on-year efficiency and profitability improvement targets, for coordinated group-wide action for every organization to improve its data. Many organizations are also proactively looking to gain end-to-end views of their F&A operations.

HP’s product addresses growing demand and adds an edge to its F&A offerings with the flight deck and its price built into every deal. It also supports HP’s strategy to provide a new style of BPO, based on data and performance analytics.

HP’s challenge is to help potential clients build the business case for the technology. As part of this, it highlights the case of an oil company that saved circa $23m in the first six months of deploying a similar MooD-based tool for its IT. HP believes the savings were possible because the client’s management team got visibility of problems and was able to take immediate action to fix them.

HP BPO Flight Deck has been deployed at one major client in the U.S. and is currently being implemented for another client in the UK.

Enterprise Technology Disruption: It’s not the Cloud, Stupid… | Sherpas in Blue Shirts

May 22, 2014

Today’s conversations and research around technology disruption and the causes invariably focus on cloud services, and rightly so. Be it infrastructure, software, or any other facet of technology consumption or development, cloud services have had, and will continue to have, the most disruptive impact. The disruption discussion also includes the impact of mobility, next-generation analytics, and the growing importance of software to control the enterprise.

This is leaving enterprise technology providers in a state of amazement and numbness. They are investing all their energy in responding to these disruptive trends. However, there are equally important dimensions they need to understand. Some of these include:

Where is the talent? How many conventional enterprise technology providers are the first choice of employees these days? They themselves believe, very few. The mindboggling (and questionable) valuation of companies such as Pinterest, Uber, and WhatsApp, and the flood of consumer technology start-ups/niche firms (reminders of 2000?), are pushing the technology talent toward these smaller companies. Job seekers now believe that all the action and fun are in consumer technology. Even within the enterprise technology segment, new candidates and existing talent are focusing on new and innovative firms (e.g., Alteryx, Coupa, Dropbox, Palantir, Tableau, Workday) or their own start-up more than on traditional vendors. Given that technology is as good as the people who innovate it, this is a serious threat for most enterprise technology providers.
Where is the plan? Enterprise technology providers take pride in their exhaustive business case modelling and time to market planning. These cases normally create a multiyear plan and staggered investments across the timeline. However, given that technology disruption is reducing the cycle of innovation and time to market, these time and tested strategies are increasingly becoming irrelevant. Do these technology providers have sufficient internal strength, processes, and willingness to jettison the age-old model of investment planning and be in sync with the shortening technology cycle?
Why so many competitors? The huge entry barriers incumbent technology providers created for newer players are crumbling in the face of technology disruption. Enterprise buyers, driven by internal and external factors, have become more receptive of nimbler and more innovative technology companies than in the past. Moreover, new-age technology providers now better understand the requirements of an “enterprise grade product.” More so, the enterprises’ requirements are themselves undergoing significant changes that suit these new-age technology firms, such as agility over control, and first to market rather than best to the market.
Who is the competition? IBM is fighting retailer Amazon for dominance in cloud services, Oracle is fighting smaller MongoDB and Postgres for the database market, Teradata is fighting Cloudera for next generation analytics, and so on. While the technology world has been replete with similar David versus Goliath stories seemingly since time immemorial, their occurrence and impact have become more severe in the past couple of years.

The enterprise technology providers are responding by leveraging their tried and true methods of acquisition, (e.g., IBM/SoftLayer, VMware/AirWatch, Tibco/Jaspersoft,) and partnering with nimbler firms (e.g., SAP, Microsoft, and IBM partnering with Hortonworks and Cloudera for Hadoop, HP partnering with OpenStack for cloud services, and Oracle partnering with NetSuite for SaaS.)

The big challenge these enterprise technology providers now have is to strategize based on the type of competition. In earlier times, they knew their competitors and how they would react, and they were comfortable in their planning meetings. However, now the environment has changed. No one knows who and where the next competition is coming from (airline industry versus video conferencing, anyone?)

While there are likely numerous other dimensions shaping the technology market today, they are tough to foresee. This makes enterprises’ and technology providers’ task of planning for their technology roadmap almost impossible.

What is the best way to move ahead? Should enterprises and providers stop their technology planning cycles and become real time planners? Should they wait it out for the disruption smoke to clear? Should they continue with their existing strategies?

If you are an enterprise technology provider or a customer trying to make sense of this juggernaut, please do share your perspectives with me at [email protected].

Productivity Improvement or Cost Takeout – Pick Your Battle! | Sherpas in Blue Shirts

May 15, 2014

I wish I had a dollar – or a couple of aspirin – for every time I heard someone claim “20 percent productivity improvement” when all they had really done was move the work to a less expensive location. When they make these claims, they’re confusing cost takeout and productivity.

Cost takeout certainly has its uses, including:

Moving work to a talent model with a flatter pyramid
Getting fewer people to work faster/harder
Offshoring

But cost takeout is not productivity, which is precisely what enterprises need to start thinking about, as most of them have already done all of the above, and then some.

As discussed in our recently released research report, “In Search of ADM Productivity,” productivity can be about (among myriad other things):

Optimizing shared services organizational structures
Standardizing and automating business processes, toolsets, and technologies
Automating infrastructure and application deployment processes

In essence, productivity is an output-input ratio. Productivity improvement has been described as “doing more with less.” I believe a better definition would be “improved output-input ratio, by virtue of being done differently.”

Think about this distinction. Technology and sourcing leaders often talk about “the need to improve productivity.” And they then promptly start flogging the dead cost takeout horse, with roughly the same return as I get (exactly nothing) from listening to the “20 percent productivity gain from outsourcing” line.

The difference between the two is worth bearing in mind because identifying and focusing on the right productivity initiatives can bear startling benefits. Our research suggests as much as 20-50 percent incremental cost savings. More importantly, the emphasis on productivity can lead to increased agility and a focus on greater functionality as opposed to “managing the mess.”

The first step is to pick the right weapon, for the right battle. Or you could always stock up on more aspirin.

Let’s Talk About Me | Sherpas in Blue Shirts

May 14, 2014

American country music artist Toby Keith’s hit song “I Want to talk about me” reminds me of a phenomenon in today’s services world — too many providers’ conversations with customers are unproductive.

Service providers are very eager to grow their revenue in their existing accounts. As the market matures, this is clearly the fastest, less costly way to grow. Customers often ask their providers to demonstrate that they can bring innovation. The problem is the provider comes back with products. That approach doesn’t align with the customer’s expectations. Clients think: “Let’s talk about me and my issues, not you and your products. Help me with my issues.”

As anyone in a marriage knows, you have to listen to the spouse’s whole day to understand what the issues are. Clients typically are not able or willing to succinctly articulate their needs. They will talk to providers about what they’re struggling with and what’s going on in their business. Out of that knowledge come issues they’re working on or potential issues they want to work on.

It’s rare that customers will have thought something through to the extent that they will say: “I want to do this” or “here’s how I want to do that.” A clear articulation of the customer’s needs and issues is particularly rare for the empowered, senior individuals.

Service providers need to engage their customers in broad discussions and at multiple levels (junior, mid-level management and senior management). And out of those discussions comes a picture of the issues and needs that they are working on or need to work on. Then the provider can talk to the client about those issues.

That talk-about-me conversation will be productive and may lead to work. And the client will feel satisfied that the provider did not “sell” something to them but, rather, helped them on their agenda.

Photo credit: Marc Wathieu

Announcing our inaugural conference: Everest Group Engage, The Pragmatic Edge: Designing Your Future. Learn more.

Tag: enterprise