Forrester’s recent book, Empowered, describes the type of technology-based innovation by frontline employees that can cause nightmares for enterprise architects. New tools for business innovation are readily available to anyone, ranging from cloud computing and mobile apps to social networks, scripting languages, and mashups. Faced with long IT backlogs and high IT costs, frontline employees are building their own solutions to push business forward.
What worries architects is that (1) solutions built with these new tools — with little or no vetting — are being hooked to enterprise systems and data, opening potentially big risks to reliability and security, and (2) the siloed, quick-hit nature of these solutions will drive up ongoing costs of maintenance and support. Traditionally, architects use enterprise standards as their primary tool to ensure the quality, efficiency, and security of their organization’s technology base. However, when applied in the typical “lockdown” fashion, standards can stifle innovation — often because vetting a new technology takes longer than the perceived window of business opportunity.
To deal with these conflicting pressures, architects must forge a new equation between responsiveness and technology control. The business value of responsiveness, combined with the typically limited size of enterprise architecture teams, means that most organizations cannot wait for architects to vet every possible new technology. Thus, you must find ways to use architecture to navigate the tension between the business value of responsiveness and the business value of a high-quality technology base. The key is to build innovation zones into your architecture; Forrester defines these as:
I’m a sucker for good, biting humor, and in the spirit of Stephen Colbert’s Medals of Fear that he gave to a few distinguished souls (the press, Mark Zuckerberg, Anderson Cooper) at the rally in Washington D.C., I would like to hand a medal to the U.S. State Department for its 1999 publication of a country-by-country set of "Y2K" warnings — “End of Days” scenarios and solutions — for Americans doing business in 194 nations. I would give another medal to IPv6, the most drawn-out killer technology to date — and one that has had the longest run at trying to scare everyone about the end of IPv4. At Forrester, we are starting to see the adoption freighter slowly turning via the number of inquiries rolling in; governments accelerating their adoption with new mandates; vendors including IPv6 in their solutions; and the Number Resource Organization escalating its announcements about the depletion of IPv4 addresses (only 5% left!). To add to the drama, vendors are in the process of creating IPv4 address countdown clocks to generate buzz and differentiation. These scare tactics haven’t worked because technology pundits haven’t spoken about IPv6 in business terms. There is enormous business value in IPv6; those who embrace it will be the new leaders in their space.
In October, with great fanfare, the Open Data Center Alliance unfurled its banners. The ODCA is a consortium of approximately 50 large IT consumers, including large manufacturing, hosting and telecomm providers, with the avowed intent of developing standards for interoperable cloud computing. In addition to the roster of users, the announcement highlighted Intel with an ambiguous role as a technology advisor to the group. The ODCA believes that it will achieve some weight in the industry due to its estimated $50 billion per year of cumulative IT purchasing power, and the trade press was full of praises for influential users driving technology as opposed to allowing rapacious vendors such as HP and IBM to drive users down proprietary paths that lead to vendor lock-in.
Now that we’ve had a month or more to allow the purple prose to settle a bit, let’s look at the underlying claims, potential impact of the ODCA and the shifting roles of vendors and consumers of technology. And let’s not forget about the role of Intel.
First, let me state unambiguously that one of the core intentions of the ODCA, the desire to develop common use case models that will in turn drive vendors to develop products that comply with the models based on the economic clout of the ODCA members (and hopefully there will be a correlation between ODCA member requirements and those of a wider set of consumers), is a good idea. Vendors spend a lot of time talking to users and trying to understand their requirements, and having the ODCA as a proxy for the requirements of a lot of very influential customers will be a benefit to all concerned.
As an immediate reaction to the recent announcement of Attachmate’s intention to acquire Novell, covered in depth by my colleagues and synthesized by Chris Voce in his recent blog post, I have received a string of inquiries about the probable fate of SUSE LINUX. Should we continue to invest? Will Attachmate kill it? Will it be sold?
Reduced to its essentials the answer is that we cannot predict the eventual ownership of SUSE Linux, but it is almost certain to remain a viable and widely available Linux distribution. SUSE is one of the crown jewels of Novell’s portfolio, with steady growth, gaining market share, generating increasing revenues, and from the outside at least, a profitable business.
Attachmate has two choices with SUSE – retain it as a profitable growth engine and attachment point for other Attachmate software and services, or package it up for sale. In either case they have to continue to invest in the product and its marketing. If Attachmate chooses to keep it, SUSE Linux will behave as it did with Novell. If they sell it, its acquirer will be foolish to do anything else. Speculation about potential acquirers has included HP, IBM, Cisco and Oracle, all of whom could make use of a Linux distribution as an internal product component in addition to the software and service revenues it could engender. But aside from an internal platform, for SUSE to have value as an industry alternative to Red Hat, it would have to remain vendor agnostic and widely available.
With the inescapable caveat that this is a developing situation, my current take on SUSE Linux is that there is no reason to back away from it or to fear that it will disappear into the maw of some giant IT company.
Can you feel it? The Twittersphere is spinning faster on its axis, anticipating the next Forrester TweetJam, Wednesday, December 15, 12:00 p.m. to 1:00 p.m. US Eastern Time. Our topic will be “Advance Your Analytic Strategies.” We’ll have a Forrester tweeting squad that includes yours truly plus any or all of the following Forrester colleagues: Rob Karel, Boris Evelson, Clay Richardson, Gene Leganza, Noel Yuhanna, Holger Kisker, Leslie Owens, Suresh Vittal, William Frascarelli, David Frankland, Joe Stanhope, Zach Hofer-Shall, and Henry Peyret.
Clearly, advanced analytics is an important theme and huge space that sprawls across many Forrester analysts’ focus areas. What I’m about to present are the humble opinions of one Forrester analyst — c’est moi — for whom this is the heart and soul of his focus going forward. These thoughts, presented under each of the proposed TweetJam questions, will give you a foretaste of what I’ll tweet on that session in just a few weeks:
Over the past two years, the economy has forced IT departments to downsize, sometimes cutting their budgets to the bone. Priorities and processes had to be reevaluated, and one of the main tenets of ITSM — do more with less — became an imperative with teeth. With the economy motivating this drive to do more with less, it may have come as an unwanted change. But it’s not necessarily a bad thing. In fact, the folks on the “O” side of Forrester’s I&O team have long been focused on how you can reduce your IT costs through automation and industrialization — essentially, how to do more with less.
But now IT budgets are springing back, which may tempt some to stray from the path of IT service management. We urge you to resist this temptation. Our research shows that in 2010, most of the I&O budget is being spent on new infrastructure, not personnel. This means you're still having to do more with less, and to do this you need to focus on process. In fact, we want you to focus on process and industrializing your operations so much, we’ve built our holiday wish list around it.
The Ten Things We Want For The Holidays (and The Ten Things You Need To Improve Your IT Service Management )
True active executive commitment
To achieve real results, you need to have CIO-level support.
Behavior change – discipline of IT service management
To launch a successful program, you need to educate and enforce.
SAP customers shouldn't worry about the financial hit. SAP can pay the damages without having to rein back R&D. The pain may also stimulate it to greater competition with Oracle, both commercially and technologically, which will be beneficial for IT buyers.
Was the award fair? Well, IANAL, so I can't answer that. But my question is, if the basis of the award was "if you take something from someone and you use it, you have to pay", as the juror said, does that mean SAP gets to keep the licenses for which the court is forcing it to pay?
The $1.3 billion verdict in the Oracle v. SAP case is surprising, given that the third-party support subsidiary of SAP, TomorrowNow, was fixing glitches and making compliance updates, not trying to resell the software. The jury felt that the appropriate damage award was based on the fair market value of the software that was illegally downloaded, rather than Oracle’s lost revenues for support.
A news article by Bloomberg provides further insight into the jury’s thinking and the legal process. Quoting juror Joe Bangay, an auto body technician: “If you take something from someone and you use it, you have to pay.” Perhaps SAP should have made its case more in layman’s terms.
SAP is in a very difficult position, in that it faces the same threat of revenue loss from third-party support. It was unable to convincingly defend its entry into the third-party support business for fear of legitimizing a business that poses a similar threat to its lucrative maintenance business as to Oracle’s.
What happens to the third-party support business going forward? The size of the award potentially dampens customer interest in moving to third-party support, particularly with another case pending of Oracle v. Rimini Street. The SAP case, however, does not invalidate third-party support as a business. Third-party support, if carried out properly, offers an important option for enterprise application customers that are looking for relief from costly vendor maintenance contracts.
For SAP, the verdict is not only painful, but it prolongs the agony, because it is compelled to appeal the verdict. SAP certainly has the financial wherewithal to pay the damages but was hoping to put this embarrassing debacle behind them.
As a lifelong Yankees fan (which makes me a pariah with many of my Red Sox Country-based Forrester coworkers in Cambridge, Mass.), I’ve been following with amusement the sports media frenzy around the New York Yankees' "not-so-public yet not-so-private" contract negotiations with their star shortstop, Derek Jeter. While I read these news snippets with the intent of escaping the exciting world of data management for just a brief moment, I couldn’t escape for long because both sides of the table bring up reams of data to defend their positions.
According to the media reports and analysis, the Yankees' ownership is seemingly paying less attention to Jeter’s Hall of Fame-worthy career statistics, including a fantastic 2009 season, and his intrinsic value to the Yankees brand, but instead is focusing on Jeter’s arguably career-low 2010 season on-field performance and advancing age (36 years old is practically Medicare-eligible age in baseball).
Jeter’s side of the negotiations, on the other hand, point out that Jeter’s value to the Yankees is “immeasurable,” and that one off year shouldn’t be used to define his value to the team. They point out that Jeter, as team captain, is a major leader in the clubhouse and excellent role model for younger players. He’s certainly among the most popular players the Yankees employ and influences boatloads of fans to attend games, watch the Yankees cable network, and provide significant licensing revenue. And of course they point out that Jeter is still an excellent player and 2010 should be viewed as an anomaly, not the norm.
I’m not a baseball analyst (lucky for everyone), and I have no intention in joining the debate on whose point of view is correct or how much Jeter should earn, for how many years, etc. (That’s best discussed over a few beers, not on a blog, right?)
Customers already use social technologies to wrest power away from large corporations. Now employees are adapting social technologies in pursuit of innovations to support these empowered customers; Forrester calls these employees HEROes (highly empowered and resourceful operatives). By designing social technologies as part of their Innovation Networks, CIOs and their IT teams help establish new Social Innovation Networks — innovation ecosystems employing social technologies to enhance HEROes' innovations. These Social Innovation Networks help drive faster, more effective innovation across the enterprise. And CIOs must rise to the challenge of nurturing and developing these networks while structuring their IT teams to fully support them.