With retail confidence and global cargo volumes at their lowest for 5 years, retailers face increased pressure to identify quick ways to minimize costs, reduce unplanned mark downs and avoid incidence of “out-of-stock”, while trying to stretch margins, improve the merchandizing mix and increase customer satisfaction.
One retail executive told Forrester “I have any number of proposals to engage in multi year, multi million IT projects. But we don’t have the luxury to indulge in those. My boss needs results now. I need to prove that we are making progress against our financial and strategic objectives in the next quarter or two.“
To help our readers, Forrester is currently exploring simple retail IT investments that can yield immediate results. Got ideas or input? Take our confidential survey on Retail IT Investment Priorities to help develop a framework that will help identify quick wins and self funding IT initiatives that are capable of generating returns for shareholders in six month or less.
I am experiencing Cloud fatigue already. If I hear anyone even come close to uttering the word "Cloud 2.0", I might be found hiding in the Forrester fitness room in a fetal position. I am a fan of Cloud computing and my colleague James Staten has a great report on cloud in the enterprise. I think that cloud computing such Amazon EC2, Microsoft Azure, IBM, Google AppEngine, and others are legitimate and have a great future in infrastructure. What I am not a fan of is the buzzword grab going on by many technology companies saying they work in the cloud, have a cloud strategy, or have a new cloud offering à la SOA, Web 2.0, and whatever is next. Vendor X can work in the cloud. Well, no kidding. You just spin up your platform in the cloud and run your app on it.
But there are new options emerging from governance, risk, and compliance (GRC) vendors. For example, Archer Technologies has added a business continuity management module to its GRC SmartSuite Framework. I recently saw a demo of the offering and I found it to be intuitive and comprehensive. It's also closely aligned with the British Standard for Business Continuity Management, BS 25999. I also recently met with MetricStream, they have also added a BCM module to their GRC platform. Provided that you've already purchased the core GRC platform from one of these vendors, buying the BCM module is significantly less expensive that buying or subscribing to a tier 1 stand-alone BCM offering. Tier 1 offerings start at US$100K and average sales prices can be in the hundreds of thousands of dollars. The add-on modules to these GRC platforms will start between $30K-$50K.
Did you know that three vendors with something in common grew rapidly during the last recession? WebEx, Placeware (now Microsoft LiveMeeting cum Office Communications Server), and Salesforce.com all grew during the last recession.
One of the reasons is that they offered valuable services -- Web conferencing and sales force automation – that companies needed help with. But the other thing they had in common is that they packaged their offering as a cloud-based service with a pay-as-you-go pricing model.
This model offered three immediate benefits to cash-strapped companies:
It was cheap and easy to get started with these cloud-based services.
The business could buy the services without IT’s help, at least initially.
It was easy to provision these services for business users.
Sometimes enterprise IT development shops that are doing development in Java, C#, VB.NET forget that it all began with C++. Invented in 1981 by Bjarne Stroustrup, C++ was arguably the first popular object-oriented language even though languages like Smalltalk proceeded it. Java was first released by Sun in 1995, fourteen years after C++ was invented.
According to the 2008 JupiterResearch Executive Survey results, online retailers continue to put search engine marketing spending at the top of their holiday sales driving tactics. Nonetheless, this trend is more subdued when compared to previous years. The JupiterResearch US Paid Search Forecast, 2008 to 2013 notes that paid search will grow 26 percent in 2008 (to $11.4 billion) and continue at a compound annual growth rate of 13 percent, however attention is starting to shift from paid search to more aggressive search engine optimization (SEO) campaigns.
15 percent less online retailers cite increasing their search engine marketing spending for the holiday season among the top three sales-driving tactics. According to the 2008 JupiterResearch Retail Executive Survey, 40 percent of online retailers will increase search marketing spending as a holiday sales-driving tactic this year. Though a high overall total percentage, this is still 15 points less retailers than the previous year. Online retailers already spend 40 percent of their budgets on search, thus the slowing of this spending increase signals a wider focus on other tactics.
Yesterday morning best-of-breed field service optimization vendor, ClickSoftware Technologies, and enterprise applications software giant, SAP, announced a heightened extension to their successful partnering history. Building on an existing record of successful synergy between the two technologies, especially within the utilities industry, SAP will now recognize ClickSoftware as a Solution Extension (SOLEX) Partner.
As an SAP SOLEX partner, ClickSoftware’s Service Optimization Suite will be sold by SAP as the SAP Workforce Scheduling and Optimization application by ClickSoftware.
How is this different from today?
ClickSoftware’s optimization suite of products will now appear on SAP’s official pricelist. As a result, SAP account executives will now be compensated for selling the ClickSoftware product and clients will have access to SAP’s support service infrastructure.
Prospective buyers, especially existing SAP customers, will have the advantage of negotiating through one vendor, one contract, one sales team – well, you get the idea.
SAP will package and resell Click’s solution suite into three bundled offerings. 1) Effectively the entire ClickSoftware suite of products with SAP Workforce Scheduling and Optimization Suite by ClickSoftware; 2) the real-time scheduling optimization and analytics product with SAP Workforce Scheduling and Optimization by ClickSoftware – Field Service and Maintenance Scheduling; and 3) the demand forecasting and resource planning products with SAP Workforce Scheduling and Optimization by ClickSoftware – Forecasting and Rostering.
"I don't want 10 developers. I want 3 great ones", is what a client told me when I asked him how his company was responding to the economic crisis. Of course, I think this is good advice even in good times and I think we have gotten away from this is recent years. Why? I think there are couple of reasons:
Outsourcing changed the focus from finding great developers to hiring large numbers of developers.
Project managers and business analysts worked their darndest to separate developers from the business problems that develoeprs need to solve. Agile has mitigated this a bit, but treating developers like machines on an assembly has been in fashion for years now.
There are fewer great developers because back in the day people passionate about software development gravitated towards a career in application development. Now it is a career choice for many and percentage of great developers has been diluted and thus they are harder to find.
I am asking every application development professional I talk to, including you, the following questions:
I know I am in the right business. Over 25 years ago, when I was a junior programmer on Wall Street, I heard the CEO of Citibank, Walter Wriston, say during one of the company meetings that “information about a transaction was going to become more important than a transaction itself”. I pondered on his prediction of the impending information revolution and decided to get into the business. I have not felt sorry ever since.
That is until now. I saw a good portion of my savings plan evaporate, some friends loosing their jobs on Wall Street in droves, and out of control media predicting, what basically amounts to, the end of the world (well, at least economic and social structures) as we know it.
What went wrong? While I am obviously not qualified to comment on the disastrous chain of events and a failure at every single link of the entire credit value chain (yes, I am not going to mention unreasonable social programs, uneducated consumers, greedy bankers and investors, ineffective risk rating agencies, and government regulation paralysis – did I miss anyone?), I am somewhat qualified to partially blame failed Business Intelligence at some levels of the credit value chain.
Quickly: For tech, this recession will be different than 2001-2003
Content: I'm not an economist. But I've been present for a bunch of recessions and watched how technology markets survived. And I spend a lot of my time talking to management teams at large companies about economic conditions and their businesses. Here's my view of the effects of this recession on technology. If you want Forrester's formal view of the recession, check out Andy Bartels' report, What the Financial Crisis Means to the Tech Market.
Here's my take:
1) Tech will be down, but not out. 2001-2003 was a tech depression. Spending stopped, projects were canceled, excess inventory flooded the market destroying pricing. Cisco lost half a trillion dollars of market cap. Why? Tech had a long way to fall. Tech spending in 2000 in the U.S. was up 12% -- there was fluff and fat everywhere. When the bubble burst, the fall was precipitous. But tech spending was up only 6% from 2006 to 2007. Users of technology are far more disciplined and have cut out the nonsense. So yes, growth will slow, but it won't fall off a cliff.