Earlier this morning, the consulting firm launched “Deloitte Digital.” Part offering and part organizational change, the initiative brings together a mix of business, technology, and creative expertise to address a perfect storm of technology change. The firm will bring together five key capabilities — strategy, mobile, social, web content, and digital ERP. Deloitte Digital will focus on mobile and social, while the traditional technology services and consulting groups will handle the strategy, web content, and digital ERP elements. The tag line for Deloitte Digital is “business led, tech enabled and creative infused.” From an organizational view point, the firm has taken a page from its 2011 acquisition of Übermind and created 11 digital studios around the globe. Approximately 50% of the staff in the studios will come from a creative, graphic design, or user experience background. The rest will be a mix of engineers focused on emerging technologies and resources coming from the traditional consulting or technology services side of Deloitte. To showcase their newfound creative chops, the Deloitte Digital Team presented the pre-announcement to the analysts using paper “pitch books” straight out of the new reality advertising TV show “The Pitch.”
Forrester believes that the Deloitte announcement highlights the hybrid skill model that the new mobile apps and systems of engagement will require. Deloitte Digital is an innovative approach for multidisciplinary new skills required for success. However, it is still not apparent how the firm would tackle the other key side of the mobile equation, building the broad ecosystem of software and as-a-service partners in order to quickly roll out solutions for clients.
Innovation is again the hot topic for clients, as it was before the economic downturn. Clients have a renewed interest in innovation and business growth, and they seek services partners who can help. But what is innovation in this context?
In this context, clients seek business innovation. They want a provider who delivers new ideas and insights that will change business processes to drive revenue or improve business processes (for example, through product innovation, customer process innovation, supply chain innovation). They do not mean delivery innovation or continuous improvement, where the provider improves service delivery efficiency to drive lower IT cost and/or higher quality of IT service to clients (for example, through improved delivery processes, shared services, reusable assets). (Of course, they usually do want this as well — but this will not necessarily drive business innovation such as new products and processes.)
What do leading firms do to drive ongoing business innovation from services providers?
1) Put process around innovation. Organizations who successfully get innovation from their services providers put processes in place, from idea discovery to incubation to implementation to measurement. They also select services providers who have codified the innovation process. Ongoing innovation cannot happen by accident.
2) Use social media to collaborate at fast paces with customers, partners, and employees. Tools such as social networking sites, microblogs, and collaboration sites let firms gather ideas, evolve ideas, and rank ideas with a wide audience.
In customer service organizations, collaboration should take place around cases and content, and should involve not only collaboration between customers and customer service agents, but internal collaboration within the enterprise. Internal collaboration has quantifiable benefits as measured by increased organizational productivity and efficiency. For cases, collaboration helps increase first contact resolution, decrease handle times and increase customer satisfaction. For content, collaboration helps evolve content to be more relevant, accurate, complete, and in line with customer demand. Some of the technologies that help foster collaboration around cases and content include:
Presence indicators, instant messaging, and video chat. These allow customer service agents to connect in real time with subject-matter experts, supervisors, managers, or other agents having the necessary skills to help resolve a question.
Collaborative workspaces. These allow agents and subject-matter experts to share documents and logs about the customer issue, the troubleshooting process, and the results in real time.
Activity streams. These allow agents and subject-matter experts to subscribe to a case and receive notifications of all changes and additions to a case.
Remote support. This allows customer service agents to invite subject-matter experts and specialty agents to troubleshoot software or hardware with a customer.
Huawei hosted about 160 industry and financial analysts at its ninth annual analyst summit in Shenzhen, China in April 2012. The main takeaway for its consumer devices business was that consumer devices complete the end-to-end pitch for Huawei. Huawei showcased its growing capabilities across the wireless industry value chain. Most notably, Huawei made a foray into the smart devices domain with its own brand of smartphones and tablets. In 2011, Huawei shipped 20 million smartphones and 60 million mobile broadband devices like dongles. The smartphone market is already overcrowded with heavyweights such as Apple, Samsung, Nokia, and Motorola; thus, it might seem that Huawei may not be able to make a very profitable business from selling these devices. However, we believe that this move will bring indirect benefits to Huawei’s core Carrier Network division in the following two ways:
It spurs the uptake of smart mobile devices. Among all companies, Huawei is best suited to leverage manufacturing capabilities in its homeland, China, to mass-produce smart devices. Moreover, as it can manufacture processors in-house through its HiSilicon subsidiary, it can control and reduce the overall price of these devices. As price is a major buying criterion for consumers in regions like China, India, and the Southeast Asian countries, Huawei will be able to expedite the uptake of devices in these countries. Subsequently, the demand for data will increase and telecom operators in these countries will need to upgrade or roll out new technologies and networks (HSPA+, TD-LTE, FDD-LTE, dual-mode networks, etc.). This is where Huawei will benefit, as it will be able to position itself as an end-to-end supplier for telecom operators including hardware, professional and managed services, security solutions, servers, and storage.
Huawei hosted about 160 industry and financial analysts at its ninth annual analyst summit in Shenzhen, China in April 2012. The event showed us that Huawei’s carrier network activities are becoming increasingly software-focused. Huawei is building up its network software and professional services capabilities. This drive is reflected in its SoftCom solution, driven by the cloud computing delivery model in the network space. Huawei is well aware of the role software will play for future distributed and virtualized network infrastructure and network-centric solutions, where the data center is effectively becoming the phone switch for ICT solutions. In fact, Huawei goes as far as to say that hardware will be fairly commoditized and that differentiation will be based on software. Huawei is a member of more than 130 industry standard-defining bodies; as such, it influences the development of industry standards. Huawei maintains its own silicon chip fabrication capabilities (HiSilicon), which help deliver opex reductions and greater energy efficiency as part of its networking solutions for wired and wireless (WiFi, WiMAX, and LTE) environments. Huawei has been designing and assembling servers for a decade and offers blade and rack configurations designed to support cloud and virtualization environments. Huawei’s security solutions, greatly enhanced by Huawei buying the remaining 49% stake in its Huawei Symantec joint venture recently, include firewall, VPNs, intrusion detection, application gateways, and unified threat management. Huawei also works with other leading ICT vendors to deliver solutions according to customer requirements. Huawei’s GalaX Cloud operating system delivers large scale virtualization capability for compute and storage resources in a cloud deployment. Huawei assists carriers and enterprise customers with design implementation and operation of deployments through its SmartCare Services solution, which monitors and ensures the
SaaS vendors must collect customer insights for innovation and compliance.
As of the end of last year, about 30% of companies from our Forrsights Software Survey, Q4 2011, were using some software-as-a-service (SaaS) solution; that number will grow to 45% by the end of 2012 and 60% by the end of 2013. The public cloud market for SaaS is the biggest and fastest-growing of all of the cloud markets ($33 billion in 2012, growing to $78 billion by the end of 2015).
However, most of this growth is based on the cannibalization of the on-premises software market; software companies need to build their cloud strategy or risk getting stuck in the much slower-growing traditional application market and falling behind the competition. This is no easy task, however. Implementing a cloud strategy involves a lot of changes for a software company in terms of products, processes, and people.
A successful SaaS strategy requires an open architecture (note: multitenancy is not a prerequisite for a SaaS solution from a definition point of view but is highly recommended for vendors for better scale) and a flexible business model that includes the appropriate sales incentive structure that will bring the momentum to the street. For the purposes of this post, I’d like to highlight the challenge that software vendors need to solve for sustainable growth in the SaaS market: maintaining and increasing customer insights.
DAM has long been stuck in the shadow of its more mature enterprise content management (ECM) and web content management (WCM) counterparts. But if our inquiry numbers are anything to go by, it’s slowly and steadily emerging from the shadows. This renewed interested in the DAM space led us to conduct our first-ever Wave evaluation of the DAM market. In this Wave report, we evaluated twelve vendors: ADAM Software, Adobe, Autonomy, Canto, celum EMC, Extensis, MediaBeacon, North Plains, OpenText, Widen Enterprises, and Xinet. Since we completed the evaluations, North Plains acquired Xinet (see my take on that deal here). This report revealed some interesting takeaways:
Henry Dewing with Dan Bieler, Katyayan Gupta, Tirthankar Sen, and Bryan Wang
Buldings on Huawei's Headquarters Campus in Shenzen, China
Huawei continues its drive for more financial openness and transparency. In an effort to shed the image of a secretive non-listed company, Huawei provided detailed information about its financial and operational performance. In 2011 Huawei grew revenues by 12% to reach US$32.4bn and EBIT by 9% to US$3bn. The main regional growth was registered in Latin America, while a 9% cash margin was the result of their investment levels – particularly in the enterprise space. These financial figures paint the picture of a company that is still enjoying strong growth and sufficient free cash-flow to fund its expansion and innovation.
The other day I visited Colt’s London HQ and saw how the telco is revamping its approach to developing more customer-centric and Agile solutions (Colt consciously avoids the “cloud” terminology). By now, most telcos managed to jump onto the cloud bandwagon by launching cloud-based services. The challenge, from an end user perspective, is that these solutions all seem very similar. Customers can get storage, server capacity, unified communications, etc., from most telcos. All telcos underline the value-added nature of end-to-end network QoS and security that they can ensure (check out our report, "Telcos As Cloud Rainmakers"). Indeed, telcos have some right to feel that they have achieved some progress regarding their cloud offerings — although it took Amazon to show them the opportunity.
But most telco cloud offerings suffer from the fact that telcos develop cloud solutions in the traditional sense through their traditional product factories. This approach tends to follow rather than slow product innovation cycles. Moreover, it produces products that, once developed, are pushed to the customer as a standard offering. All customisation costs extra.
The reality of cloud demand is that each customer is different. Most customers want some form of customisation. Most customers want some form of hybrid cloud, a private part for core apps, as well as access to the open Internet to, for instance, exchange views and information with end customers via Twitter or for crowd sourcing with suppliers. Similarly, most customers want a mix of fixed and virtual assets and a blend of self-service and managed service solutions as the chart indicates.
Our next installment of "Hackers vs. Executives" is just weeks away. Join us at the Forrester Security Forum and sit in on one of the most popular sessions of the event each year. We have a great panel lined up for you. In the Hackers corner, we have Chase Cunningham of Neustar and Brian Gorenc of HP Tippingpoint DVLabs. In his hacking demo, Chase will use social engineering, packaged exploit delivery, and credential harvesting to show you how open source data can create avenues for hackers to attack users and ultimately compromise your network. In his hacking demo, Brian will provide an in-depth look at what it takes to analyze a vulnerability and the steps required to weaponize it. Centering on a vulnerability in a Microsoft application, the demo will show you how an attacker can quickly move from proof-of-concept to remote code execution.
In the Executive corner, we have Richard Bejtlich of Mandiant and Steve Martino of Cisco Systems. Richard and Steve will discuss what these types of attacks mean to Security & Risk professionals, including how your organization can prepare and respond to them. John Kindervag and I will moderate the panel. There will be great discussion and you will have the opportunity to ask questions of all of our panelists. It will be a fantastic session; one you won't want to miss. Please join us in Las Vegas on May 25th from 11:05 to 12:40. Take a look at the Security Forum website for more details. John and I hope to see you there.