Yesterday morning (June 28), I , along with a small group of Microsoft customers, partners, and members of the technology and business press, sat in a SoHo, NY, gallery to listen to Microsoft CEO Steve Ballmer announce the release of Office 365, the long-awaited successor to Business Productivity Online Standard Suite (BPOS). In his remarks, Ballmer positioned the product set as a way for businesses of any size to facilitate communication and collaboration. What he and all of the multimedia presentations in the gallery stressed was how Office 365 addressed the productivity and collaboration needs of IT-constrained small and medium-sized businesses. While smart business (it helps Microsoft tell a compelling story against Google, which is doing well in that part of the market), the natural question I heard from people in the room was, "What about the enterprise?"
Today Taleo announced the acquisition of privately-held, Europe-based Jobpartners for $38 million (€25 million) in cash. With this acquisition, Taleo strengthens its European presence in talent management, as Jobpartners has a presence in 50 countries and 28 languages and is also a talent management vendor. The deal is expected to close in early Q3. Jobpartners has only 68 customers, but these customers include Deutsche Post DHL, Nike EMEA, Rabobank, and 16 Global 500 companies. Jobpartners also has a R&D facility in Krakow, Poland and a support center in Scotland that no doubt figured prominently in Taleo’s acquisition decision. In terms of technology, the fit is a good one, because Jobpartners is SaaS-only. Taleo said that it is in the process of evaluating Jobpartners’ technology, but this acquisition is not about acquiring new technology — it’s about doubling Taleo’s customer base in Europe and becoming a known European player in the talent management field. Customer success teams made up of Taleo and Jobpartners staff are in place to meet with Jobparters customers to help them get familiar with Taleo. Taleo will continue to support the existing Jobpartners platform for a while as plans are put in place for the transition.
Forrester has been analyzing the impact of consumerization of IT on business since this seminal 2008 report. And we've collected data to measure the phenomemon since 2009. Did you know that 35% of information workers use personal technology for work? And we published a Harvard Business Review Press book, Empowered, on why companies must empower their employees: it's so they can serve the needs of empowered customers.
And now we can directly link consumerization with business outcomes that IT and every other part of a business cares about: innovation, advocacy, and leadership. We've done this with a Q1 2011 survey of 5,102 information workers in North America and Europe, our Workforce Forrsights data.
The report, "How Consumerization Drives Innovation," is chock full of data available to Forrester customers. This post is an excerpt to introduce the outcomes and impact to everybody. We'll use three charts to make the point.
First is the consumerization data. Just how many information workers in North America and Europe do something with technology outside of IT control -- either bring their own smartphone or tablet for work, use unsanctioned Web sites for work, or download applications to a work computer? It's one in three!
Back during the dot.com boom years, existing telcos and dozens of new network operators, especially in western Europe and North America, laid vast amounts of fiber optic networks in anticipation of rapidly rising Internet usage and traffic. When the expected volumes of Internet usage failed to materialize, they did not turn on or “light up” most (some estimate 80% and even 90% on many routes) of this fiber network capacity. This unused capacity was called “dark fiber,” and it has only been in recent years that this dark fiber has been put to use.
I am seeing early signs of something similar in the build-out of infrastructure-as-a-service (IaaS) cloud offerings. Of course, the data centers of servers, storage devices, and networks that IaaS vendors need can scale up in a more linear fashion (add another rack of blade servers as needed to support an new client) than the all-or-nothing build-out of fiber optic networks, so the magnitude of “dark cloud” will never reach the magnitude of “dark fiber.” Nonetheless, if current trends continue and accelerate, there is a real potential for IaaS wannabes creating a glut of “dark cloud” capacity that exceeds actual demand, with resulting downward pressure on prices and shakeouts of unsuccessful IaaS providers.
The Canadian market for purchases of information and communications technologies (ICT) by businesses and governments is about 10% the size of the US ICT market, and only about 3% of the global ICT market. Still, it is an important market because of the sophisticated level of its tech adoption (i.e., its readiness to adopt advanced technologies) and its proximity to the US market.
Canada's ICT market growth rates of 6.2% in 2011 and 2012 growth of 8.1% in Canadian dollars will be very similar to the US ICT market growth in US dollars in the same periods. With the Canadian dollar having gained strength against the US dollar, that means that US vendors will see even stronger Canadian revenue growth when they convert their Canadian sales back into US dollars.
Communications equipment and software will have the strongest growth in 2011, at 10.5% and 8.4%, respectively. Computer equipment growth of 4.4% and telecommunications services growth of 2.2% will be the weakest product categories.
Government investment in ICT is growing. At Forrester we expect the overall government ICT budget to reach $346 billion in 2011, growing to $382 billion in 2012 or by about 10%. That makes government one of the largest vertical industries – almost double the size of the retail industry, well above the telecom industry and actually behind only professional services and financial services. As government soul searching intensifies in the wake of the financial crisis, and in light of global competition and economic recovery, we expect the dawn of a new government – not “big government” but a government that operates more effectively and certainly more efficiently. What does that look like, and what does that entail? We see three primary trends:
A move to greater performance management processes with an emphasis on KPIs for specific programs rather than just budget targets.
An increased dependence on technology but with an eye to rationalization and consolidation, and an increased role of a centralized CIO to coordinate technology adoption;
And, a growing adoption of enterprise management tools with visibility not only into department level programs but including executive dashboards to enable a holistic view of the government.
As a geographic unit, the market for business and government purchases of information and communications technologies (ICT) in Western and Central Europe will grow by 3.8% in 2011 (measured in euros), compared with 6.4% growth in the US (measured in US dollars). Excluding slow-growing telecommunications services, the information technology (IT) market in Western and Central Europe will grow by 4.5% in euros vs. the 7.4% growth in US dollars in the US (see June 7, “European Information And Communications Technology Market 2011 To 2012 -- The North-South Divide Persists, With Wide Variations In Country Information And Communications Technology Growth”).
Giving workers flexibility in when, where, and how they work is a hot topic right now. The US federal government has passed legislation to make telecommuting easier and multinational firms, like State Street, are instituting programs to let employees choose when and where they work. Why are organizations emphasizing this so much? Mobile and remote employees have more control over their work/life balance and won't have to stop working if circumstance prevents them from coming to the office. Furthermore, they can easily be collocated with clients and allow the company to reduce its real estate and carbon footprint. However, as this chart from my new report, Demystifying The Mobile Workforce, shows, information workers may be moving more quickly to this flexible way of working than their companies currently acknowledge: 66% of the North American and European workforce work outside the office at some point during a month.
If business leaders and their counterparts in IT are to get in front of this trend, they have to understand their mobile and remote workforce. For example, who is shifting work between the office and home? What technology are they using to do so? Do they believe that the company is doing a good job of providing them the policies and technology to work in this way? If business and IT leaders can't answer these questions, they will be hard pressed to accurately:
The personal computing experience has become a major pain in the neck, as people add smartphones and tablets to the growing number of PCs they use at work and at home – more than half the US online population, about 135 million people, have the challenge of managing their content across multiple PCs and smartphones.
Forrester believes that a new computing experience is emerging, based on the personal cloud concept, that will redefine the computing experience around a user’s personal and work information, so that it’s seamlessly accessible across all of an individual’s devices. The growing personal cloud ecosystem is characterized by:
A $12 billion market value by 2016, with $6 billion of it from direct subscription revenue.
At today’s Worldwide Developer Conference, Apple unveiled iCloud, the company’s long-expected solution for the multi-device, multi-connection world. With iCloud, Apple has liberated its customers’ iPhones, iPads, and [more recent] iPod touches from their tether to a Mac or PC, recognizing that these products play an increasingly primary role in their owners’ lives. For product strategists (vendor strategists can read my colleague Frank Gillett's take here), the most important attributes of iCloud are:
Its pricing. How much does iCloud cost Apple’s customers? Zero. Zip. Zilch. Well, at least in the basic form that Apple contends will suffice for a vast majority of its customers, iCloud is free for anyone who owns an iOS or MacOS device provided she doesn’t require more than 5 GB of storage for all the stuff Apple will hold on her behalf. Apple’s message to its customers is: you’ve always got your stuff, on whichever device you prefer at this moment. This stands in stark contrast to other cloud-based services like Dropbox and Sugarsync that force consumers to think carefully about butting up against their storage limits, just as the soon-to-be-the-default capped data plans force them to think about how many bits are traveling up and down which network.