I’m in Las Vegas attending Infosys’s Connect 2011 client event, and one of the recurring themes in sessions and side conversations has been the nature of Strategic Partnership. The phrase risks becoming a meaningless cliché, so I was interested to research what it actually means to Infosys execs and clients. I got some interesting, varied perspectives.
A large CPG company’s central IT group described its interpretation in a couple of sessions. It demands, among other things, a strong cultural fit, a commitment to win:win solutions to problems, and regular meetings with partners’ CEOs. This group has 12 “strategic partners” who get a lead role in a specific area, but may not even be considered in other areas, even though they have good solutions in their portfolio. I might argue the semantic point about whether this means they are merely ‘important, at the moment’ rather than ‘strategic’. However, the key point is that the two parties’ commitment to making the partnership work creates a better, stronger commercial framework than any legal agreement could deliver.
Raj Joshi, MD of Infosys Consulting, described his group’s Value Realization Method (VRM) that formally tracks each project’s expected business benefits from the initial project business case through design and implementation and onto ongoing value delivery. Joshi stressed the importance of shared incentives, such as risk/ reward sharing commercial models, in ensuring projects’ success.
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.
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”).
The lines are blurring between software and services — with the rise of cloud computing, that trend has accelerated faster than ever. But customers aren’t just looking at cloud business models, such as software-as-a-service (SaaS), when they want more flexibility in the way they license and use software. While in 2008 upfront perpetual software licenses (capex) made up more than 80% of a company’s software license spending, this percentage will drop to about 70% in 2011. The other 30% will consist of different, more flexible licensing models, including financing, subscription services, dynamic pricing, risk sharing, or used license models.
Forrester is currently digging deeper into the different software licensing models, their current status in the market, as well as their benefits and challenges. We kindly ask companies that are selling software and/or software related services to participate in our ~20-minute Online Forrester Research Software Licensing Survey, letting us know about current and future licensing strategies. Of course, all answers are optional and will be kept strictly confidential. We will only use anonymous, aggregated data in our upcoming research report, and interested participants can get a consolidated upfront summary of the survey results if they chose to enter an optional email address in the survey.
Forrester just published our latest forecast for the US market for business and government purchases of information technology (IT) goods and services (April 1, 2011, "US Tech Market Outlook, Q1 2011 -- Building a Springboard For Even Stronger Growth in 2012"), and we have raised our 2011 and 2012 outlooks: we now forecast 8% growth in the US in 2011 (up from our 7.4% forecast in January) and 10.3% in 2012 (compared with a 9.3% forecast earlier). For the broader ICT market (information and communications technology, adding in telecommunications services), 2011 growth will be 6.8% compared to a 5.1% rise in 2012.
Like many connected with IBM as an employee, a customer, or an analyst, I watched IBM's Watson beat two smart humans in three games of Jeopardy. However, I was able to do so under more privileged conditions than sitting on my couch. Along with my colleague John Rymer, I attended an IBM event in San Francisco, in which two of the IBM scientists who had developed Watson provided background on Watson prior to, during commercial breaks in, and after the broadcast of the third and final Jeopardy game. We learned a lot about the time, effort, and approaches that went into making Watson competitive in Jeopardy (including, in answer to John's question, that its code base was a combination of Java and C++). This background information made clear how impressive Watson is as a milestone in the development of artificial intelligence. But it also made clear how much work still needs to be done to take the Watson technology and deploy it against the IBM-identified business problems in healthcare, customer service and call centers, or security.
The IBM scientists showed a scattergram of the percentage of Jeopardy questions that winning human contestants got right vs. the percentage of questions that they answered, which showed that these winners generally got 80% or more of the answers right for 60% to 70% of the questions. They then showed line charts of how Watson did against the same variables over time, with Watson well below this zone at the beginning, but then month by month moving higher and higher, until by the time of the contest it was winning over two-thirds of the test contests against past Jeopardy winners. But what I noted was how long the training process took before Watson became competitive -- not to mention the amount of computing and human resources IBM put behind the project.
Cosmopolitan magazine certainly doesn't publish articles such as "Seven Hairstyles That Will Make Your Man Yawn." Wildly desirable is more like it. And so too, is it with great software. If you want your applications to be successful, you better make them wildly desirable.
My latest published research has identified seven key qualities that all applications must exhibit to be wildly desirable, with our choices based on research and inquiries on software design and architecture; assessment advisories with clients; and interviews with leading experts, including both practitioners and academics.
Forrester defines the seven qualities of software as:
The common requirements that all software applications must satisfy to be successful: user experience, availability, performance, scalability, adaptability, security, and economy.
All seven qualities are important, but if you get the user experience (UX) wrong, nothing else matters.
The UX is the part of your application that your employees and/or customers see and use daily. You can do an exceptional job on project management, requirements gathering, data management, testing, and coding, but if the user experience is poor, your results still be mediocre — or even a complete failure.
SAP Has Managed A Turnaround After Léo Apotheker’s Departure
In February 2010, after Léo Apotheker resigned as CEO of SAP, I wrote a blog post with 10 predictions for the company for the remaining year. Although the new leadership mentioned again and again that this step would not have any influence on the company’s strategy, it was clear that further changes would follow, as it doesn’t make any sense to simply replace the CEO and leave everything else as is when problems were obviously growing bigger for the company.
I predicted that the SAP leadership change was just the starting point, the visible tip of an iceberg, with further changes to come. Today, one year later, I want to review these predictions and shed some light on 2010, which has become the “Turnaround Year For SAP.”
The 10 SAP Predictions For 2010 And Their Results (7 proved true / 3 proved wrong)
For eBusiness leaders, software app stores represent a new and disruptive distribution channel for PC and Mac software.
Three weeks ago, Apple launched its App Store for Macs, following in the footsteps of the hugely successful app store for the iPhone, iPad and iPod touch. With the new Mac app store, Apple is hoping to change the way Mac users discover, download and purchase software. At launch the store contained more than 1,000 apps, and Apple was keen to report an impressive 1 million downloads on the first day. For Mac users it’s a compelling story:
A convenient one-stop shop. Users can launch the app store right from the Mac dock, revealing a powerful set of discovery tools to browse and search the library of apps on offer. eCommerce best practices are employed throughout including search, faceted navigation, what’s hot, top sellers, favorites and customer reviews to create an intuitive discovery experience.
Frictionless purchase and install experience. Downloading and buying in the app store is a simple one-click process. By linking the checkout and payment process to users' iTunes accounts, Apple is able to streamline the buying process significantly versus a typical multipage checkout process common on software publishers' eCommerce sites. The apps in the Mac store have been packaged to comply with the Mac app install process, making the installation quick and seamless compared to the multistep install process common with most software.