Upcoming Workshop: Applying Agile And Lean Strategies To BPM Initiatives

Join Forrester Senior Analyst Clay Richardson in Washington D.C. on October 20, 2009 for the interactive one-day workshop Applying Agile And Lean Strategies To BPM Initiatives. In this workshop, you will learn best practices for integrating Agile and Lean methodologies into all facets of your BPM initiative. Through exercises and case studies you will build an action plan for incorporating Agile and Lean best practices into your organization’s BPM initiative.

To learn more about this workshop or to register, please click here.

Podcast: How To Select Your First BPM Project

Our latest featured podcast is Connie Moore's "How To Select Your First BPM Project"

In this podcast, BP&A Research Director and Vice President Connie Moore discusses how you should employ your first BPM project. She begins by suggesting that business process professionals think big and target major organizational pain points with their first endeavor. She goes on to suggest best practices for moving on from this first process implementation and ends with a discussion of how long these projects generally take.

We look forward to your questions and comments.

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IBM Goes Deeply Predictive, Announces Acquisition of SPSS

By James Kobielus

IBM dropped a big bombshell at the start of any already action-packed day for the analyst community. At this moment, I’m sitting, along with several dozen of my peers from Forrester and other firms, at the IBM Smart Analytics System launch event in Hawthorne NY. I’ll blog on IBM’s other announcements in a separate items.

The bombshell was IBM’s announcement that it’s acquiring SPSS, a long-established, leading provider of predictive analytics (PA), data mining (DM), statistical analysis, and text mining tools. The acquisition, subject to the usual shareholder approvals and regulatory reviews, is expected to close later this year. But, even in advance of that near-certain consummation, IBM’s bold move has already sent shockwaves throughout the analytics market.

Most important, IBM has acquired the second largest vendor of PA/DM solutions, dwarfed only by privately held SAS Institute. In this segment, IBM’s proposed acquisition is having the same impact that its Cognos buy had on the business intelligence (BI) market two years ago. In many discussions with Forrester customers, SPSS is often mentioned as a key solution provider for predictive modeling and statistical analysis against structured, semi-structured, and unstructured content.

For IBM’s competitive standing in the data management market, this acquisition represents one of the last missing pieces of its Information On Demand (IOD) portfolio. By acquiring SPSS, IBM has acquired a substantial PA/DM brand with a very loyal set of longtime customers who have build their customer churn, supply chain optimization, and other predictive models on its best-of-breed platform. SPSS recently underlined its feature-comprehensive value proposition through re-branding around the “Predictive Analytics Software” (PASW) family name. But longtime customers didn’t need to be reminded, of course, that what used to be known as “Clementine” defines a functional high-bar in this solution segment.

IBM would probably be the first to admit that it took its focus off the PA/DM market over the past several years as it build out the BI, data warehousing (DW), and other pieces of its IOD portfolio. IBM had never really exited the PA/DM market, but casual observers might have thought otherwise. However, the vendor three years ago chose to de-emphasize its Intelligent Miner tools--which support mining of structured data--as stand-alone offerings. It essentially buried these solutions, moving them into its InfoSphere Balanced Warehouse family, where they are now offered as features of its Enterprise Edition DW software, rather than as stand-alone tools that would be enhanced and evolved independently.

IBM and SPSS’s respective customer bases should rest assured that overlaps among their respective product portfolios are not extensive. Once the acquisition closes, IBM is almost certain to build out its SPSS brand and, over the coming 1-2 years, phase out the Intelligent Miner technology within its InfoSphere portfolio. One tricky issue is which text analytics solution family--SPSS’ or IBM’s OmniFind solutions--will prevail as the parent converges these offerings in its IOD portfolio. Another issue is how IBM will integrate the SPSS offerings into its still-evolving in-database analytics roadmap for InfoSphere Balanced Warehouse. Hopefully, IBM will maintain and extend SPSS’ already extensive in-database analytics integration with a broad range of vendor DWs, including such Big Blue rivals as Oracle, Microsoft, Sybase, and Teradata.

Who loses from IBM’s acquisition of SPSS? Fundamentally, one can’t help think that SAP missed the boat by not seizing the opportunity to acquire partner SPSS, whose Clementine technology it OEMs, has integrated with its BI technology, and sells as SAP BusinessObjects Predictive Workbench. PA/DM is an increasingly key component of a full-fledged BI solution stack. However, the remaining field of vendors with stand-alone, horizontally applicable PA/DM vendors consists primarily of vendors who are large but proudly and stubbornly independent (especially, SAS Institute); high-quality but much less widely adopted (e.g., KXEN, ThinkAnalytics); or specialized on customer, financial, scientific, or other specialized analytics (e.g., Unica, Fair Isaac, Accelrys).

Some IBM rivals in the BI space already have strong PA/DM tools, most notably Oracle (Oracle Data Miner) and TIBCO/Spotfire (the Insightful tools). Among BI vendors, Microsoft, MicroStrategy, and Information Builders have PA/DM capabilities, but they are not to a SAS or SPSS level of sophistication. These and other BI vendors should also be scouting for strategic acquisitions.

What do you think? Will IBM’s acquisition of SPSS lead to further merger and acquisition activity in this space as other leading BI players strengthen their PA/DM solutions?

The next wave of BI acquisitions?

By Boris Evelson

Whoever says that Business Intelligence (BI) market is commoditizing is smoking something funny. From where we sit, it remains active, vibrant and full of opportunities both on the buyer and the seller side. On the buyer side the market is far from mature with multiple architecture, implementation, governance and organizational challenges. On the seller side we track over 20 “next generation” BI features that vendors are just beginning to address.

With today’s IBM announced acquisition of SPSS, BI world moved a step closer to addressing one of the gaps in traditional BI product lines – integrated advanced analytics. Traditional business intelligence applications (reporting, ad-hoc querying, OLAP) are great at answering questions like “what happened”, “why it happened”, etc, but they do not help you with answers to questions like “what may happen”. This is the realm of advanced analytics, predictive data modeling, statistical analysis, etc – provided by vendors like SAS, SPSS and some other, including a popular open source package “R”.

Here’s where the world of traditional BI and advanced analytics stood until this morning:

• SAS was a clear leader in the space having provided integrated solutions for the past 10 years
• MicroStrategy also built in their own advanced analytics into its BI package
• Microsoft delivered a few basic data mining routines available in SQLServer DBMS engine via Excel
• TIBCO Spotfire acquired Insightful
• IBM Cognos and SAP Business Objects partnered with SPSS
• Information Builders integrated open source “R” package

The combination of traditional BI and advanced analytics was a real differentiator for vendors in this category. While most other traditional BI vendors partnered with advanced analytics vendors, a simple partnership carries certain implications:

• There’s no common metadata – so all definitions of metrics, measures, indicators, etc need to be build and replicated in two places



• Advanced analytics typically require their own DBMS (typically proprietary) to churn large data sets through multiple complex calculation iterations. Moving these huge data sets and results from one DBMS to another is always a throughput challenge

So what are the implications of IBM SPSS acquisition? Plenty!

• IBM can compete more effectively with SAS, TIBCO Spotfire, MicroStrategy, Microsoft and Information Builders in deals that require both traditional and advanced analytics



• IBM has to reconcile some overlap of its DB2 Intelligent Miner and SPSS for data mining and IBM OmniFind and SPSS for text mining. Since it’s still business as usual at Cognos and IBM (most products are being developed separately) I do not expect that this will be a priority in the next 12 months.



• SAP Business Objects may need to rethink their advanced analytics strategy. They may need to go the open source route or acquire another advanced analytics vendor. Plenty of choices out there, here’s one sample short list: Accelrys, Angoss, Applied Predictive Technologies, DataInfoCom, Genalytics, KXEN, Megaputer, Partek, Psydex, ThinkAnalytics, Xeligence.



• A big unknown is what Oracle may do to address this opportunity. Just like IBM Oracle also has Oracle Data Mining (ODM) product built into its 11g DBMS. It also has a Real Time Decisions (RTD) engine that it acquired from Sigma Dynamics a few years ago – although this product is somewhat geared towards marketing analytics, specifically real time offer optimization. Will Oracle combine these two products and integrate them with their traditional BI suite (Enterprise Edition – OBIEE), or will they acquire a 3rd advanced analytics product? With Oracle, we never know.

What’s next? After we go through what is sure to be a wave of advanced analytics acquisitions, we are on to the next stages. Plenty of opportunities left for all large BI vendors to round out their offerings with in memory analytics, text analytics, process analytics, information post-discovery, and many many more. Have fun, everyone!

UPDATED: Does Putting Customers "First" Pay? Amazon.com Buys Zappos.com for $928M

By Dr. Natalie Petouhoff

UPDATE: I just got a email from Tony- he asked if I could add to the post the letter he sent to his employees about the aquisition- the link to the letter is at end...

While at the Forrester IT Forum this past spring, I was invited by Tony and Alfred to visit Zappos.com. I was intrigued about what I had heard about this company. Could it be actually true that even the receptionist understood what customer lifetime value (CLTV) meant?

Zappos.com was known for their extreme customer service... but was the whole culture really like that? And if so, how did that work? I had enjoyed the tweets I'd seen of the nearly 400 Zappos.com employees on twitter- they seemed authentic, genuine... Zappos had built its business through developing relationships, creating personal, emotional connections and delivering high touch (WOW) customer service.

I reached out to Tony via Twitter and let him know I would be in Las Vegas. He immediately tweeted back, "Please come visit!"

I had met Alfred (the COO/CFO) and Tony (CEO) back in February of 2009 on Twitter. That's when I had started my research on the ROI of social media for customer service.

Curious if what I heard in that February interview would be embodied in the actual corporate culture, I ventured from the Palazzo.I had imagined waiting in long taxi lines typical of Las Vegas... They would have none of that! I was greeted by a wonderful young women in a truck with a large Zappos.com logo. "Wow, I thought... They offered to come pick me up! That's some kinda service!"

The gal that picked me up- she was one of the many receptionists-- talked about what a wonderful place Zappos was to work; how important the culture was to her and that she couldn't imagine working anywhere else. Oh, and that how they treated customers-- how everyone at the company treated customers, not just the customer service reps, but everyone.... was their "secret sauce." She said --like real customer experience trouper--" It helps us increase our customer lifetime value." And that was my first experience of the embodiment of Zappos.com's CLTV.

We arrived at the building and as I entered the lobby, I was WOWOW'd by the decor. It was fun, hip- and there were bookshelves full of THE top business books- not just one or two of one's fav books, but just about everything you'd want to read... and not just one copy like a library, but 10-20 copies like a well stocked bookstore.... "The Tipping Point, Blink, How to Win Friends and Influence People, Co-opetition, Freakonomics, Chief Customer Officer, Tribal Leadership, The Ultimate Question, Flow, The Wisdom of the Crowds..." You get the picture... I asked -- being a book addict -- what they were for.

The receptionist said, "Those are for our employees to read. We can take them, read them, give them to our friends. Go ahead, browse the shelf. Take whatever you want."

I asked, "So any employee, at any time, can just take a book. You don't have to buy it or check it out? She said, "No that's part of our culture. To continuously learn and be customer-focused."

I was greeted by a handsome young man, Donvaon Roberson, who took me on the tour of the call center as well as the rest of the operation. It was clear that each group had played a large part in decorating their area to reflect their values, their dreams and their passions. It was not your typical company cubicles. It was colorful and vibrant. It rang of "play." But not "play" in the "not so serious play"-- but more of the type of "play" where enthusiasm was followed by passion which was fueled by truly delighting customers.

As the tour ended, I "got" that they "got it." Customers were their business. Not shoes. Not orders. Not paperwork. Not spreadsheets. Not warehouses. They were in the business of serving customers- EVERYONE -- marketing, sales, customer service, accounting, shipping... everyone truly got that the recipient of whatever a particular person's "job" was--- was a real, live human being. And it mattered how they did that "job" because ---what they did somehow, some way affected another human being. And that level of consciousness and caring was astounding.

So on this day of July 23, 2009, the day that Amazon bought Zappos for $928M, I had to pose the question, "Does putting customers "first" pay?"

There's long been two camps. Those that drive the bottom-line so hard that anything that can't be seen as revenue on a P&L must be a waste. Their mantra? "Cut the fat! Cut the fun! A serious employee's work is never done!"

And then there are those who believe that the customer and their experience fuels the bottom-line. I appreciate what my colleague Bruce Temkin has done to prove the business value of the customer experience. And I appreciate what Tony and Alfred did by building a company that is a true example of the value of putting customers first.

Perhaps now that we have the "proof" that putting customers "first" does ---and will always pay- may the mantra of all companies become, "Love your customers, love them all. When you do, you never know what riches -- of the soul, of the heart or of the bank, you will be fall."

What's your take on the importance of putting customer's first?

Learn. Grow. Share.    @drnatalie or npetouhoff@forrester.com

Letter to Zappos.com employees from Tony: http://blogs.zappos.com/ceoletter .

Oracle Targets Real-Time Data Integration With GoldenGate Acquisition

By Rob Karel

Today, Oracle announced plans to acquire GoldenGate Software, a private company specializing in data replication and real-time data integration solutions. 

This acquisition will focus on two specific areas: (1) high availability to support data replication and migration efforts and (2) non-invasive real-time data integration capabilities. 

From a data replication standpoint, GoldenGate will improve Oracle’s support for heterogeneous replication beyond Oracle sources and targets. In addition, GoldenGate supports a zero downtime, active-active configuration by bi-directionally synchronizing data between the old and new versions of apps and database platforms — an important capability for Oracle customers either migrating to or upgrading from Oracle apps.  Of course this replication capability also supports other use cases in high availability such as backup strategies, among others.

In addition, Oracle will be looking for GoldenGate to increase its Fusion Middleware strategy’s capabilities to support real-time data integration.  Its Oracle Data Integrator (ODI) product (formerly Sunopsis, acquired in late 2006) was a more traditional batch ETL-oriented technology (although Oracle refers to it as E-LT since it specializes in pushdown optimization architectures).  GoldenGate adds to Oracle’s data integration portfolio advanced change data capture (CDC) capabilities that allow ongoing real-time pulls from the database log files of production environments — meaning that the performance of these production environments won't be impacted from the ongoing queries into their database.  This is a critical requirement to enable high volume data extraction to support real-time data warehousing and BI, as well as master data management and other operational use cases.

Oracle’s challenge now, of course, is reconciling yet another data integration solution — albeit a value-added one — into its already crowded portfolio.  It seems apparent (to me at least) that Oracle Warehouse Builder (OWB) will be delegated as simply a useful Oracle database utility to support batch ETL processes into Oracle databases and data warehouses. ODI, on the other hand, has become the data integration platform of choice for Oracle to support its major apps, BI, MDM, and SOA product strategies. 

So Oracle is acquiring GoldenGate and IBM previously acquired DataMirror in 2007 (see my blog post about that acquisition). An interesting question I have is if and when SAP will have a response to these CDC/realtime data integration acquisitions?   I receive a large number of inquiries from SAP clients looking for advice on tools and best practices to manage their SAP migrations, because they feel the SAP NetWeaver PI (Process Integration) toolset does not effectively support their migration needs.   SAP BusinessObjects offers a more robust and heterogeneous ETL platform in Data Integrator, but it still does not support the more advanced real-time CDC requirements that GoldenGate and DataMirror now provide for Oracle and IBM, respectively.   Anyone think SAP should be making a move here?  How about Attunity as a potential target?

Podcast: Revisiting Product Information Management

Our latest featured podcast is Rob Karel's "Revisiting Product Information Management"

In this podcast, principal analyst Rob Karel outlines the key themes from his recent product information management (PIM) research. He starts by talking about the buy- and sell- side procuct data environments, and outlines a value proposition for managing this product data. He ends by reviewing the capabilities that clients should look for in a PIM application.

We look forward to your questions and comments.

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Which Customer Managment Technologies Deliver The Most Value?

By William Band

To make the savvy investment decisions, BP&A professionals need to know which CRM applications have the strongest track record for delivering results. I just surveyed 286 companies to understand their opinion of 19 categories solutions that comprise the Extended CRM Application Ecosystem.

Here’s a sneak peek of my findings:

• Sales, order management, and service are the keys to your revenue engine. The business and IT executives that we surveyed feel that “core” business processes like selling, order taking, and customer service are the most critical to their success. For, example over half report that order management, customer service & support, and contract center infrastructure applications are critical solutions. Forty-eight percent say that salesforce automation is a critical app, and 42% say this is the case for eCommerce solutions.



• Customer data management and intelligence are keystones for success. The Holy Grail for CRM professionals has long been to achieve a “360-degree” view of customers. Consequently, 44% of the companies I surveyed report that customer business intelligence and customer data management are critical solutions for their businesses.



• Marketing solutions are viewed as moderately important. Despite the importance placed on growing sales and orders for the companies we survey, only about one-third felt that enterprise marketing management solutions were critical for success. This was true for both B2C and B2C companies.



• Social computing solutions are not yet viewed as critical. The rapid adoption by consumers of social and Web 2.0 technologies has upended traditional thinking about how to define and to “manage” relationships with customers. However a present, the solutions associated with Social Computing are not yet viewed as critical to success compared to other “core” solutions. A low percentage of respondents evaluate market feedback management, customer forums, and customer communities as critical for success (18%, 10%, and 6%, respectively). Interest in social computing solutions is strong, however. For example, 16% are piloting customer communities, and 26% have interest in learning more and trying out these types of solutions. Mainstream companies are watching early-adopters for evidence of success.

This is not the full story, of course. We also asked the respondents about their opinion of the market reputation of each solution category, and how difficult they are to implement. Taking into account all three factors: criticality, and reputation, implementation risk -- you can pick the winning technologies and avoid chancy bets.

To find out more about the findings from the research, check out my teleconference this week. And, read my TechRadar report about the Extended CRM Ecosystem for a detailed rundown on all 19 technologies that we have evaluated.

Who Should Lead the Customer Social Media Interaction?

By Dr. Natalie Petouhoff

I've had a number of interesting debates on who should lead the customer social media interaction in the last few weeks. In part, this question comes up because a great deal of social media was initiated in the Marketing department via listening or brand sentiment programs. What we do know is that all departments benefit- marketing, sales, service, product dev, engineering from the voice of the customer information that results from deploying social media.

And while I know that not everyone will agree, after studying all the various departments that could lead social media, I'm still convinced customer service should lead the customer social media interaction. The reason is that while a sales social media strategy might help sell more products or services or a listening platform might help branding and marketing create more convertible leads, those departments are only interested in their objectives - i.e., more sales or more leads... And that is as it should be.

The issue is that someone needs to be the social media customer interaction brand ambassador. Customer service is really the only customer interaction department... the others don't really have a two-way relationship with customers. They push materials out... they do need the voice of the customer to do that better, but they (and the technology that supports their function) doesn't support a two-way interaction. (You could argue that social media now enables a two-way relationship, but as a technologist, I'm looking at the enterprise software - MRM or SFA types of applications - that sales and marketing use to do their jobs.) Customer service technology's only purpose is to interact with the customer. (It doesn't always create a great experience, but it is built to create that interaction.)

You might think that I feel that way because I cover customer service and the customer experience. I hope that I have a balanced approach and I'm able to assess things as they are and be objective. I do hear the arguments and reasons for other departments leading the initiative or for owning the customer relationship. Mary Beth Kemp, VP and Principal Analyst and I had a wonderful brainstorm about this topic. Laura Ramos, VP and Principal Analyst and I have engaged in this same discussion. Here's my thoughts:

Imagine if marketing professionals had to sit in the contact center and answer customer complaints about why their bill is so high or that their cell phone doesn't get service or that their kid just drank some cleaner and needs helps.... Or if sales people had to figure out why a customer's router isn't connecting their new lap top to their new DSL service or that a customer hit "send" on a website and it didn't seem like anything was happening so they hit it six more times and was charged for six airline tickets instead of one... Neither department's strong suit is those types of customer interactions -- nor do I think they would thrive if they spent their days and nites doing this types of activities.

The best strategy for a company is always to have everyone do what they do best. That's why the various functions departments got created. Customer service is best suited to be the leader of social media customer interactions because that's what they do, day in and day out. And with the business transformations that occur because of what social media reveals about a company, the things that don't make sense about how a company interacts with a customer change. Those changes are empowering customer service to finally have the budget, resources and positional power to do right by customers; to create WOW customer experiences and to engage and enroll customers through genuine, authentic and honest communications.

I just had a great inquiry with a VP Of Marketing, who is leading the social media customer initiative at his company. He saw my ROI of Social Media Customer Service research and was interested in it because he felt that the largest ROI for his company will be when customer service deploys it. As a company considers social media, who owns the social media intiative is one of many questions that must be answered.

So in honor of my fav news broadcaster, Walter Cronkite, "That's the way it is..." 

or it is at least my 2 cents for this saturday morning...

Love to hear your thoughts!

@drnatalie or npetouhoff@forrester.com

And thanks to @txglennross for his suggestion on changing the languaging from "own" to "lead" - I love that suggestion and changed my post because of his feedback.

One Large Step for Customer Experience: Lithium Announces A Social CRM /Customer Service Solution

By Dr. Natalie Petouhoff

If you follow me on Twitter (@drnatalie) you have seen the on going conversation around whether Social CRM and Customer Service actually exists or if it is a fantasy.

Paul Greenberg has put his final stake in the ground on defining what Social CRM means- You can read more on the post that drove a huge discussion.The debate centers around alot of things - whether CRM is a strategy, a process, a technology. At the end of the day, most agree that its an all inclusive way of building relationships with your customers. Bill Band, Vice President and Principle Analyst at Forrester, has written about Social CRM in his ever popular doc CRM 2.0: Fantasy or Reality? How Trail-Brazing Organizations Are Implementing Social Customer Strategies.

What This Means To You:

As social media has emerged on the scene, its made possible via Web 2.0 technology, to create deeper, more meaningful relationships with customers. Part of the chasm for customer service professionals has been that there are a lot of CRM/Customer Service vendors/applications and many Web 2.0 vendors/applications. There's now an intersection of these two sweet spots, via announcements by companies like RightNow Technologies, to provide contact centers with more ease and efficiency around social media by being able to monitor and interact with customers in the "cloud" --and thus the gap is lessening.

When I do inquiries with clients, I find that they are grasping to understand what social media means to their business, how will they apply it to customer service, the contact center, to self-service and what's the ROI. That's in part why I calculated the ROI of customer service social media in this doc: The ROI Of Online Customer Service Communities.What's interesting about the Lithium announcement is that they are a Web 2.0-type application that has figured out how to bridge some of the gap between traditional CRM/Customer Service vendors and Web 2.0.

What customer service professionals don't need is another customer interaction channel. What they do need is a way to create WOW interactions with customers; to reach out to customers that are dissing them, to resolve issues and to re-establish bonds. Lithium's strategy is to allows businesses to proactively build stronger, deeper customer relationships by integrating social customer conversations into existing CRM and customer service business processes and systems. Lithium provides a pre-integrated social media platform that works in conjunction with RightNow Technologies's contact center/customer service platforms.

As the number of vendors in the CRM/Customer Service space continues to grow and shape shift, driven in part by the explosion of social media, I'll try to keep you informed of the developments that affect you. Look for the Customer Service Best Practices doc coming out soon-- that has a section on the range of social media technologies that can be applied to Customer Service-- as well as other topics. For social media- technology is only one part of the success criteria.

How Can I Serve You Best-- in The Wild, Wild West --of Customer Service Social Media?

What I don't want is for you to "fall into the gap" and that's easy to do. With 29 vendors just in the Customer Service Wave... there's a lot to consider. Now add social media... the Thanksgiving plate feels overload and you could feel bloated. There are no stupid questions. Remember that. I just taught one of my clients how to use Twitter- how to set-up an account and begin using it for customer service. Its ok to ask me anything. If I don't know, I'll ping the other 17 analysts at Forrester who cover social media. We have your back covered.

Let me know what questions you have about customer service social media. What would you like to see in my research on this topic? What questions do you have that are keeping you late at nite? I'm writing as fast as I can. Your help in prioritizing the topics is much appreciated!

Thank you, @drnatalie

(To follow the discussions on Twitter.com you can use an application like tweetdeck.com- download it and do a search on the hash tags #scrm or #socialmedia or #customerservice or #cctr or #drnatalie)

(Link to Lithium announcement)