Cloud, technology populism, video, and integrated solutions were in evidence throughout the show. Here is what I learned or conformed at Enterprise Connect 2012:
Cloud is happening. Buyer interest is and has been up, service providers are investing, and OEMs are enabling. At the show, SPs from 8x8 and M5 (now part of ShoreTel) to AT&T and Verizon were demoing capabilities. SIs, including well-known names from BlacBox to Presidio to HP, were talking about cloud too. Many OEM vendors did not discuss the channel implications made obvious by SI and SP discussion of cloud services — although NEC made ease of doing business for the channel one of the tenets of its cloud discussion. If I were a solution vendor, I would spend more time discussing where my solutions could be purchased and the role for my sales force, since buyers who attend Enterprise Connect in droves want to know where and how they can buy cloud solutions.
The real story here is consumerization or technology populism. Personal cloud services have enabled information workers to be a decision AND buying center for all types of communications and collaboration. Although we talk about smartphones and tablets in discussing technology populism, unified communications and fixed mobile convergence were the examples on display at this show. Buyers (including information workers and traditional technology managers) today need to know how to integrate Box, Google Docs, SalesForce, and other services into their business processes that depend on communications.
Speed and agility are at the heart of business today — and, unfortunately, those are two areas in which IT is falling short. Two trends — neither of which is going away anytime soon — are impacting this increased need. Consumerization is rapidly changing the expectations of today’s information workers. In too many instances that we care to acknowledge, your employees are using faster, more agile solutions at home than they are at the office. On top of that, businesses are under an increased demand to change.
Enterprise architects are in a unique position to be change agents for their businesses — if they aggressively change the way they work with the business. Join us at our Enterprise Architecture forums — May 3 to 4 in Las Vegas and June 19 to 20 in Paris — for practical guidance on how to connect EA with your business’ bottom line.
We have just published Forrester's current forecast for the global market for information technology goods and services purchased by businesses and governments (see January 6, 2011, "Global Tech Market Outlook For 2012 And 2013"), and it shows growth of 5.4% in 2012 in US dollars and 5.3% in local currency terms. Those growth rates are a bit lower than our prior forecast in September 2011 (see September 16, 2011, “Global Tech Market Outlook For 2011 And 2012 — Economic And Financial Turmoil Dims 2012 Prospects"), where we projected 2012 growth of 5.5% in US dollars and 6.5% in local currency terms. I would note that these numbers include business and government purchases of computer and communications equipment, software, and IT consulting and outsourcing services equal to $2.1 trillion in 2012, but do not include telecommunications services.
Step into my office, fellow I&O professional, and join me on a brief but rich journey of imagination. Imagine you're a business jet sales sales rep. Now imagine that this morning you went to the garage where you keep your company car and for the second time in a month, the key fob won't open the doors and you have no other way in. You have a big airplane deal on the table with the head of an investment bank in the city in 1 hour, and it's a 50 minute drive. Just then…as if to mock your dilemma…a voice from the car says "I'm sorry Dave, you do not have access to this car. Would you like to request access from the car's owner?" "IT'S MY CAR", you shout! You think of your boss and what she's going to say: "You should have allowed more time, Dave. Remember, YOU are responsible for your quota. Everyone has the same challenges. It's up to YOU to think ahead."
After an hour, the door unlocks and the car's voice apologizes. "I'm very sorry for the inconvenience, Dave. The motor pool coordinator forgot to add your name to the list of sales reps with company cars after the sales re-org last week. It has been fixed now." $%&#! you yell. You missed the client meeting and the deal, and you will also now miss your quota. To make sure it NEVER happens again, you start making other transportation arrangements. In fact, you think the new Land Rover Evoque fits your style and perhaps you don't need the company car after all. You're being paid on results, and excuses -- no matter how legitimate -- don't count.
7:30 AM, on Monday, December 5th, 2011, flight 1052. As I took my seat in Southwest Airlines' "Business Class," otherwise known as the exit row, I gave a nod to my new seat mate and noticed his MacBook on the tray table. He was reading something on his iPad and set it down for a second to send a text message from his iPhone. Now there's a Kool-Aid connoisseur, I thought. "Going to Salt Lake or beyond?" I asked. "Salt Lake. Gotta visit some customers, and after that I have to go to Boise to train our western region sales team."
And so the conversation began. I learned that his name is Jamie, he is in sales, travels every week, loves his job and his company, and is the top sales performer. $3M in quota last year and his secret sauce is knowing his customers' businesses better than they do, and delivering value with every interaction. He said, "Last week I had a meeting with a new prospect for the first time, and they couldn't believe I showed up without slides, and we spent the meeting talking about their situation instead of throwing up all over them about what we do." Jamie is a HERO. His world revolves around delivering customer value, and he has neither the time nor the patience for anything that gets in the way.
Naturally, I asked him some questions about his MacBook Air and the applications he uses. His answers, while fascinating, echo what I hear from many others like him:
Q: How do you like your MacBook Air? A: I love it.
Q: Does your company issue those or is that one yours? A: Hell no! It's mine! They gave me a huge Dell.
Q: Where is it? A: It's in the closet at home, still in the bag.
Q: Does your company support the Mac?
HP made the right decision today to keep the Personal Systems Group. Beyond the reasons cited, supply chain and sales synergy and expense of spinning out, it's also crucial for HP to remain in the market for personal devices, which is entering a period of radical transformation and opportunity. The innovations spawned first by RIM with the BlackBerry, followed by the transformative effects of Apple's iPhone and iPad are beginning to ripple into the PC market. Apple's MacBook Air and Lion operating system, combined with Microsoft's Metro interface for Windows 8 herald the beginning of a transformation of personal computing devices. By keeping PSG, HP has the opportunity to innovate and differentiate in the PC market that will move away from commodity patterns.
For vendor strategists at vendors of all sizes, one of the lessons of HP's decision is that consumer businesses are becoming more relevant to succeeding in commercial products for end users. During the announcement call today, CEO Meg Whitman talked about the importance of "consumerization" in winning business from enterprises. I heartily endorse that view and look forward to sharing a report soon on how consumerization is changing commercial product development.
Do you think consumerization was a part of why HP kept PCs?
What effect do you think consumerization will have in IT markets?
Picture the scene in the HP boardroom when the board members decide the company needs (another) new CEO. They had trouble just last fall finding outside candidates and don’t seem satisfied with internal candidates. I can imagine a New Yorker cartoon–like scene, where they all agree to draw straws, and the board member drawing the short straw gets the CEO job!
But it was not like that. The board realized something that Forrester felt for some time — that HP needs better communications to customers, markets, and employees. Meg Whitman, former eBay CEO, is a not an obvious choice, especially given her primarily consumer and web business experience. But she brings strong Silicon Valley roots, something lacking in HP’s recent CEOs, which should help a lot with injecting new energy into HP. And she starts with a strong business reputation for growing eBay, being a good leader, and communicating well. Plus she’s got a nine-month head start as board member on understanding HP over any outside candidate.
As the new HP CEO, Whitman faces a difficult situation. HP has a strong set of products and customer brand that are being damaged by the uncertain directions of the board and the repeated CEO turmoil. Meanwhile, the Wall Street traders and technology press are overreacting, as they often do — HP has solid product and service offerings that are just as good as they were last week, before the latest leadership turmoil. So what should she do?
We at Forrester have written a lot about the “empowered era” in the past year. We’re talking about the empowerment of customers and employees, the consumerization of technology, and grass-roots-based, tech-enabled innovation. There are lots of great case studies around illustrating these forces and how they can benefit the enterprise, but those success stories are only part of the picture. Behind the scenes, there is disruption and confusion about who’s planning the road ahead regarding the technology in our organizations’ future. It used to be that the CIO made sure that happened by making it the exclusive domain of strategic planners and enterprise architects. But isn’t centralized — and IT-based — tech planning the opposite of empowerment? Wouldn’t sticking with the old approach result in missing out on all this employee innovation that’s supposed to be so powerful? Should the CIO no longer establish the technology the enterprise will use? Does the empowerment era mean the end of tech planning as we know it?
Today, 22% of employees say that they have used a non-IT-provisioned service over the Web to perform their job function —not to update their Facebook accounts, but to do real work.[i] Many employees are no longer relying on IT to provision, manage, and run their technology because they feel IT is too slow and puts unnecessary restrictions on their use of technology. Many customers expect on-demand information, customized user experiences, and mobile apps that IT is expected to deliver quickly, cheaply, and reliably. Some CIOs have reacted to this shift by vigorously defending their turf from these encroachments. Others have ceded control to third-party service providers and business managers who now make their own technology decisions.
I'm not going to comment on the $8.5B purchase price, though I'm sure Marc Andreesen's investment company is happy with their return. And I'm not going to comment on the impact on Xbox, Hotmail, and Live.com. And I don't think this has anything to do with Windows Mobile.
But I am going to comment on the impact of the deal on the enterprise, and specifically on content and collaboration professionals responsible for workforce productivity and collaboration. When you strip it down to its essence -- Skype operating as a separate business unit reporting to Steve Ballmer -- here's what you need to know about the Skype deal:
First, Microsoft gets an important consumerization brand. Skype is a powerful consumer brand with a reported 600+ million subscribers. But it's also a "consumerization brand," meaning that it's a valuable brand for people who use Skype to get their jobs done. Consumerization of IT is just people using familiar consumer tools to get work done. It's a force of technology-based innovation as we wrote about in our book, Empowered: Unleash Your Employees, Energize Your Customers, Transform Your Business. Google and Apple and Skype have dominant consumerization brands. Microsoft does not. Until now. And as a bonus, Google doesn't get to buy Skype. And more importantly, neither does Cisco.