In our latest US and Global IT market forecast (http://www.forrester.com/go?docid=53305), Forrester stays steady with our June 2009 projections that the US tech market will start to recover from the downturn in Q4 2009, with the global tech market improving in 2010. However, the 2009 growth rate now shows a bigger decline than our earlier forecasts, for two reasons. First, cutbacks in capital investment, which had earlier been confined to computer and communications equipment, spread in the first half of 2009 to licensed software, causing big declines in this category of tech purchases. Second, upward revisions to US IT investment data in 2007 and 2008 by the US Department of Commerce raised the base periods for measuring 2009 growth, making the 2009 declines even greater than before. Thus, we now project a -9.3% decline in US tech purchases in 2009, compared to a 5.1% decline in our June forecast. But those revisions confirmed our position that a tech boom was starting to take shape in 2008, before being rudely interrupted by the September financial. The weak results in early 2009 also mean that the market will hit bottom sooner, setting a low base for year-over-year growth starting in Q4 2009 and into 2010.
The story is the same for the global outlook. 2009 now looks worse than our previous forecasts, but 2010 still looks like a year of solid recovery. One factor that will help reported vendor results (especially for US vendors) is the decline in the value of the US dollar against major currencies since March of 2009. The value of the dollar is now about where it was a year ago, so vendors will be able to report Q4 2009 revenues in US dollars that will be better than their currency-adjusted numbers.
I'm nobody's fan boy. I don't love any particular brand. Never have. Never will. It's not in my DNA. I love my family, I love food and wine and dinner conversation, I love making music with the band, and I love to ride my bike on Metro West roads with a buncha guys. I don't love products.
But I do love great technology that improves lives and businesses. That's my calling card and the reason I work at Forrester Research.
We have lots of data and analysis that illuminates the future. It's our stock in trade. Data like the level of enterprise IT support for BYO phones (46% provide some support). Or the number of working Americans that own a mobile phone (84%) or a smartphone (7.4%). BTW, this data shows where the real growth potential in this market is.
So what matters in the smartphone platform enterprise wars? Great products, stellar service, attractive prices, and memorable marketing matter of course. But in my experience with platforms wars and device wars through the ages, some other things will matter as well:
BYO phones will matter a lot because it allows firms to deliver the amazing benefits of smartphones to more people at lower cost. And that puts the decision into the hands of an individual (though perhaps from an approved list. [Forrester clients should ping me to see this data; it's an important shift in the market.]
After a wave of pretty abysmal attempts in the early part of this decade, virtual chat agents pretty much disappeared from the scene. However, the past couple of years has seen a new wave of implementations of this customer-facing technology with some large-company implementations, including “Frank” on the Verizon website (Ask Verizon); “Louise” at eBay France (Votre conseillère virtuelle); and “Anna” at Ikea (Have a Question?). Virtual chat sits in the interaction spectrum between search and live customer service agents and combines natural language processing, conversational interactions, and an (optional) animated persona.
Over the past few weeks, I’ve spoken to three different vendors in this marketplace — all of whom have seen an uptick in the their business over the past 12 months. The common themes expressed by all three — the ability to engage customers with a more conversational tone where questions are answered, rather than search results based on keywords presented; and common results of better sales and higher service call avoidance, indicate that virtual agents may make a good corporate “hire” in the right circumstances. Rough estimates of costs — about $0.25 per successful resolution of the customer problem.
I talked recently with the SAP CRM management team and partnering with SAP appears to becoming less onerous for vendors of customer-facing complementary software products. Many of these interaction-centric products in areas such as email management, knowledge management, and communication channel management had been forced into a go-it-alone strategy when looking to integrate with SAP CRM and Customer Service installations due to complex partnering rules and high fees. In a recent briefing, SAP appears to have loosened the reins a bit – structuring mutually beneficial agreements with a number of companies (announcements to follow) outside of their traditional partner channels. This bodes well for all three stakeholders in such a relationship: SAP, who broadens the capabilities of its product with well-integrated point solutions; independent software vendors, who can now work with SAP to tighten integrations; and users, who will benefit from co-marketed, tested solutions. As an indication that this is not just trading logos on PowerPoint decks, in at least one case, most of the work to integrate the products is taking place by SAP within the SAP product. Expect more news about the specifics of this new strategy in next few weeks. This is a vast change from prior policies which offered potential “partners” two choices – take it or leave it.
Despite the economic situation, investments in BPM tools remain a key priority in many firms. Attracted by their performance-improvement potential, business stakeholders often adopt such tools from inside their functions and fail to recognize the overall impact at the enterprise level. The consequence? Many tool-based initiatives are counterproductive, making already intricate processes even more complex and difficult to support. As costs swell and projects become unmanageable, the responsibility of BPM falls onto the IT’s lap. As recent Forrester Leadership Board (FLB) research on “Driving Value With Process Improvement” illustrates, CIOs must step up to the mark and proactively embrace the responsibility for BPM-tools early in the life-cycle. To succeed, they must leverage their position in the enterprise as they:
Have a unique cross functional view of business processes. CIOs straddle all business units, developing portfolio of services tailored to each business function, and understanding each business users needs and expectations from technology. They are able to view processes which span all business functions, allowing them to disseminate best practices and knowledge, as well as being able to continuously refine processes. CIOs are business executives ideally placed to support the business in its process improvement initiatives.
Our last post on Gen X using Web 2.0 at work generated a lot of buzz in other blog posts, particularly at ReadWriteWeb.
One of the biggest comments had to do with how generations are defined.
At Forrester, we spent about a month looking at this question back in 2006 when we did our first generational analysis of the use of technology. (We've since updated that work in "The State Of Consumers And Technology: Benchmark 2008" -- available to Forrester clients.)
The more we looked, the more we realized that nobody frickin' knows. So we did what we comes naturally -- we researched it. We canvassed the universe. We read all the books and talked to a bunch of experts, mostly from the Agency world, where they know a thing or two about generations.
Since nobody had a definitive set, we create them based on blended average of the best references out there. Then we added a Forrester twist: What technology era does it correspond to? (Meaning, when they were teenagers, what technology was new to them.)
Gen Y: 1980-1991. This group started spending money in the mobile era -- it's still their defining characteristic. Mobile texting, making party plans on the fly while out, carrying their identity around in their phones, that's Gen Y. They don't think twice, they just do it. This group would love to use social media at work, but mobile's good enough for now thank you very much. They are 50% more likely to text while at work as Gen X (51% versus 36%.) As far as showing the rest of us the path forward, it's probably leading by example at this point in their careers.
So I have now spent a couple of days at TechEd - attending sessions when possible, and meeting with some Microsoft executives to discuss their strategies in more detail, I have also spoken with the "real" attendees at the event when possible (after sessions, in coffee queues, etc) to get their take on the proceedings.
As hypothesized in my first blog post, my first impressions were correct. Microsoft is a much more positive organisation - no longer apologising for its past sins (Vista, Windows Mobile 6 etc) but looking forward to better times where solid and reliable platforms, such as Windows 7 and Windows Mobile 6.5 will help their customers to make better use of the great platofrms that already exist within their customer base (such as Exchange, SQL Server. Windows Server and SharePoint).
A government report published September 3, 2009 (and reviewed in a Washington Post article titled “Federal Government Needs Massive Hiring Binge”) reports on a detailed study of US Government positions that will become open requisitionss as Baby Boomers retire over the next four years. This concern about large numbers of government retirees is not new but this study makes some stark predictions that are eye-catching.
Top 10 Areas of Government Hiring in Next Four Years