I can't believe that I've been with Forrester for three weeks. I am still learning cool new things every day but also feeling more at home as each day passes. I've been very fortunate to have already had many interactions with so many sourcing and vendor management professionals. I've really enjoyed getting to know so many of you and I'm totally psyched about all the questions you are asking and the things you want to talk about. Keep them coming! And speaking about psyched, I'm a huge fan of the TV show "Psych." Shawn and Gus are the best! Thank heavens for the invention of the DVR and the ability to watch the episodes I missed, all at once. But I digress . . .
Despite being so psyched, I also have to deal with a lot of changes in my life: leaving my previous company after nearly 28 years; moving from an office in downtown Minneapolis to a home office out in the suburbs; traveling more than working from home; working with a new team and meeting many new colleagues; switching to an iPhone after using a Blackberry for over 8 years; learning a whole new set of company applications, benefits, policies, procedures, tools and templates; and becoming a writer and a researcher. But I'm still psyched.
Amidst all of this change, some key things in my life remain the same. I’m still focused on offshore outsourcing, global delivery, and vendor management. These key areas of concentration have been my passion for the past 11+ years. The thought of being able to focus on these areas full time is very exciting. I’m so anxious to work with all of our clients. I was in your shoes, I know what you are going through, and I know that I have a lot I can share with you and your company.
With Halloween just around the corner, it’s time to get creative about how you can scare the pants off of the people in your IT organization. I’ve been attending a fair amount of CIO events recently, and in the spirit of Halloween I put together a few costumes that I can guarantee will keep your CIO up at night.
A Storm Cloud. While “The Fog” might have scared your CIO in 1980, thirty years later it's the cloud that is scaring him. Despite all of the hype around "as-a-service technologies" over the past two years, Forrester has found 48% of IT decision makers still say they are “not interested” or “have no plans to adopt” software-as-a-service -- a number that rises for other cloud-based offerings. Why the lack of interest? Security, integration, and lack of customization top the list of key SaaS concerns. Yet, as the cost savings and purchasing flexibility benefits becomes increasingly obvious, IT professionals know they have to get comfortable with their fears to reap the cost-saving and flexibility benefits that cloud-based offerings provide. (Extra costume points: Grab a lunch tray and say you are a cloud-based “server”. A full 59% of IT decision-makers say they are not interested or have no plans to adopt infrastructure-as-a-service.)
I like sourcing and vendor management professionals for all of the reasons they drive others crazy. Business and IT executives like to complain that SVM teams care only about getting the lowest cost (this complaint usually comes after said sourcing team tells the business user his vendor of choice isn’t the best option). Vendor sales people are taught to avoid SVM professionals whenever possible because they keep asking questions like “Why is your product worth this much money?” and “Show me how you bring value to my company.”
The SVM executives I deal with are a tough group (and don’t think I get off easy: Forrester is a vendor to these executives too, so I’m not immune to the same challenges as other vendors). They’re a practical group, and not inclined to be swayed by idealized visions of innovation, for example. They accept nothing at face value, they question everything in painstaking detail, and they resolve conflict instead of working around it.
So why is this pragmatic, sometimes cynical, group talking about emerging technologies, new services models and other innovations? Because in their pragmatism they know that they need to move their organizations forward to take advantage of opportunities presented by new technologies and services. And they know if they don’t, the business will do it without them – opening their firms to increased costs and higher vendor-related risks.
While I’m not claiming SVMs have abandoned their focus on reducing cost, the need to take advantage of new opportunities is critical. As a result, there are three key areas where Forrester sees SVM investing:
Some of you may recognize the guy at the front as Fireman Sam, the eponymous "hero next door" of the BBC children’s program set in the fictional Welsh town of Pontypandy. What does he have to do with software licensing?
Yesterday I spoke about software licensing trends to a group of customers, prospects, and partners of licensing optimization vendor Flexera. One of my key messages was that software asset managers (SAMs) must move on from reactive firefighting via fire prevention (both of which I call "Fireman SAM") to a more proactive management of license needs (which I call "license optimization"). Fireman Sam uses traditional asset inventory and hard disk discovery tools to try to measure software usage, compare it with license entitlement, and rectify any shortfalls. Fireman Sam’s arch enemy is License Audit Bill.
In contrast, a more mature process adds analysis of what licenses you really need to the data on usage and ownership. This information enables software sourcing managers to cut expenditure on excess licenses and over-specified versions. For example, Flexera’s product for SAP enables customers to put users in the right categories, thereby minimizing the purchase of more expensive "full user" licenses.
Best Software License Management Considers Three Questions
Clients frequently tell us how much they value connecting with their peers. A few years ago we created the Forrester Leadership Boards Sourcing & Vendor Management Council to serve that need. But in the age of social technologies and interconnectedness there are valuable conversations you can have with peers who aren’t part of that private community. So this week we launched The Forrester Community For Sourcing & Vendor Management Professionals.
The community is open to all Sourcing & Vendor Management Professionals, whether you’re a Forrester client or not. Check out the community and you’ll see conversations focused on the key business challenges that you face every day. The community is a place for you to exchange ideas, opinions, and real-world solutions with each other. Our Forrester Leadership Board teammate Sara Dupuis is managing the community, helping facilitate the discussions. Forrester analysts will also participate and share their views.
Here’s what you’ll find:
A simple platform on which you can pose your questions and get advice from peers who face the same business challenges.
Insight from our analysts, who weigh in frequently on the issues.
Fresh perspective from peers, who share their real-world success stories and best practices.
Content on the latest sourcing and vendor management issues and trends — from Forrester and other thought leaders.
Analysts suffer get the benefit of dozens of briefings per year from hopeful vendors trying to convince us that they are the next big thing. Here’s a typical example of marketing-speak messaging that is an amalgam of all the mistakes that will ensure a vendor goes on our "not with a barge pole" list.
“Exvezium is a leading provider of Purchasing and Supply Optimization (PSO) solutions, focused on the automotive, retail, financial services, and government sectors. Customers such as Mutt Publishing, Shania Entertainment, and the Steiner Wig Corporation have chosen Exvezium for its very unique requisition automation, online tendering and award optimization capabilities. Leading analyst firm Milometer classed Exvezium as a Strong Challenger in its Sourcery Square 2009 evaluation.
"The four best practices for implementing PSO are getting executive buy-in, choosing a configurable solution, supporting constraint-based awarding, and maximizing event activity," said CEO, President and Founder Mark Ettingbabble. "Exvezium supports these through our combination of cutting-edge technology and best-in-class services."
What’s wrong with this? Here are my dirty dozen analyst pet hates: