I hosted a dinner last night at Forrester's Business and Technology Leadership Forum here in Orlando. Great discussion with 12 CIOs, several CMOs, and a vendor CEO. When we weren't passionately debating politics, we spent time compiling recession strategies -- the best ways of riding out a potential economic slowdown.
Quickly: Forrester predicts a technology slowdown lasting three to four quarters, driven by an expected mild recession.
Forrester uses its extensive primary research with consumers, large companies, and vendors to continually forecast tech spending and the health of the overall economy. Here's what we're seeing.
The financial services sector (investment banks, regional banks, local banks, mutual fund companies, hedge funds, securities firms, credit card issuers, etc.) represents about 18% of the US IT market. The Wall Street portion (Citibank, JP Morgan Chase, Bank of America,Lehman Brothers, Goldman Sachs, et al.) is approximately a third of that, or about 6% of total U.S. IT spending. The troubled firms (Lehman, Merrill, Bear Stearns, AIG, Fannie, Freddie) represent only 2% of IT spending -- this is the portion most in danger of being cut.
Since I was very young, I have loved cars. I drive a Porsche in the summer and a four wheel drive Audi in the slick New England winters. I love these two cars -- they make my commuting hours bearable and sometimes fun. I often ponder the question -- If you ripped the Porsche shield off my 911 or the four Audi rings off my A8 and replaced them with a Ford oval, would I still drive the cars? You bet I would. The quality, design, history, feel, and experience would keep me happily in those cars, even if you put a Nash Rambler logo on their front hoods. Which roughly proves a point -- it's not the branding that's the problem with American cars, its the cars. Consumer Reports' research verifies this -- in the organization's five categories of 2008 cars and SUVs, none of the top five vehicles come from a domestic producer.
Why can't American companies build a great car? They are designing and manufacturing day in and day out, so what is preventing them from making something great?
On Thursday, Forrester announced that it bought JupiterResearch for $23 million in cash. Bringing the two companies together has been a dream of mine since the 1990s -- Jupiter always had incisive analysts, influential clients, and always seemed to be ahead of the next trend -- and it always seemed like a cultural match for Forrester (OK, I'll admit it -- they were probably much cooler than us...)
It's pretty simple why we bought Jupiter. Marketing and strategy executives are probably the most challenged by technology changes. I was with the head of marketing for a major national newspaper recently who said to me: "...given Facebook, blogs, YouTube, Craig's List, we don't know what will be in the future -- we have no idea." Forrester serves these executives -- and adding JupiterResearch's analysts, salespeople, and service people to this effort will help us help our clients even more -- and it will mean that we can grow that business faster.
Quickly: Cisco's high-definition video conferencing TelePresence system will change how large companies communicate.
Last week I avoided a trip to California by having my one-day meeting with Cisco leadership via TelePresence. This is the company's next generation video conferencing. It features high-definition video, exceptional sound, and specialized rooms with the conferenced individuals "sitting" around a table with the live participants -- the pic shows my team in Boxborough MA conversing with John Chamber's team in San Jose CA. Everyone is life-sized, and the experience is a close emulation of an in-person meeting. Cisco has deployed 240 systems worldwide and has staged 120,000 meetings -- for a claimed cost savings and productivity gain of $150 million. The company calculates that it eliminated 24 million cubic feet of carbon emissions as a result.
When a new technology was introduced in the 1980's, my then Yankee Group boss Dale Kutnick would cryptically remark, "It's happening." But most of the "happening" was incremental, without much impact on society or culture.
25 years after "The computer moved in" (fascinating retrospective reading) all of that incremental digital change has accumulated. And the many water drops of progress have created a tidal force that, in its essence, is making things go away...
Quickly: Gates's monopolistic business practices created a significant benefit for technology users -- a set of standards that greatly streamlined communications and work.
I've grown up with and lived with Bill Gates as the most influential technology leader of the era. Even though he has been slowly backing out of Microsoft for the last five years, his actual July 1, 2008 departure from the company is a milestone worth reflecting on.
What is his single most important legacy? The ability, through monopolistic business practices, to make Microsoft's products global, de facto standards for business and consumers. This created a standard ecosystem of documents, spreadsheets, printer drivers, programs, browsers, and operating systems which enabled people to communicate in a single "language" -- greatly easing the inherent limitations of computer systems.
Quickly: IT/BT executives should ensure that their goals align with the CEO's.
Forrester's IT Forum was in Las Vegas last week. Great time, with over 1,500 clients and sponsors on-site. Highlights for me were John Chambers of Cisco jumping off the stage into the audience to sell his vision and an amazingly elegant dinner for over 1,000 at the very cool Tao Club in the Venetian.
I kicked off the proceedings with a ten minute talk entitled "CEO Success Imperatives." Whenever I meet with a CEO I ask a simple question: "What do you, as the CEO, have to do to be successful?" Here are the seven themes that emerged from my CEO research:
1) Getting, keeping, building the best people. "I hire 15 people every hour. I want the best." 2) Engendering collaboration. "If HP could only harness the knowledge of HP." 3) Reaching global markets 4) Increasing profit. "HP makes $12 million per hour but spends $11 million per hour. I want to change that proportion." 5) Building a positive culture. "I want a company culture that is viewed positively from the inside and from the outside." 6) Customers, customers, customers 7) Driving innovation. "I want to figure out how to break linearity."
Quickly: The Internet will squeeze broadcasters into a slim niche.
I've often wondered whatever happened to two parts of public discourse: 1) eloquent speeches, and 2) truth-telling. I have been helping my son study American history and the other night we read two famous statements from the debates surrounding the 1850 Compromise: John C. Calhoun's defense of the South and Daniel Webster's response. Both men spoke in passionate but reasoned phrases -- one threatening secession, the other advocating union. Marvelous reading.