The Forrester Tech Tide Methodology

The Forrester Tech Tide™ is a report that examines the maturity of an ecosystem of technologies and helps clients make decisions on which technologies to invest in and when. Specifically, the Tech Tide: 1) defines the technology categories necessary to perform an overarching business function; 2) characterizes the business value and maturity of each category; and 3) offers guidance on how clients should approach the technologies in each category: Experiment, Invest, Maintain, or Divest. This document is your guide to understanding Forrester Tech Tide research. It outlines the methodology that our teams use to produce this research.

Technology management professionals must make the best technology adoption, maintenance, and retirement decisions for their firms. But they struggle with this because: 1) many stakeholders and teams are involved; 2) adoption decisions depend on a firm’s appetite for risk; and 3) analytical tools for tech adoption are either nonstandard or nonexistent.

The Forrester Tech Tide simplifies these tasks by providing a framework to assess the value and maturity of these technologies. Forrester Tech Tide reports are the foundation for our research about software and hardware products. The Tech Tide is the first in a sequence of this research. Using the Tech Tide as a foundation, you can then drill into specific categories in more depth through our New Tech and Now Tech reports and Forrester Wave™ and Forrester New Wave™ reports.

Forrester believes that the health of the ecosystem is far more important than the quality or maturity of a standalone technology. Why? Because the technology industry is littered with examples of great technologies that failed because the vendors didn’t build enough momentum in terms of value-added service providers, happy customers, developers, evangelists, financial backers, or certified experts. We conclude that the primary elements of a healthy technology ecosystem consist of:

• Customers who buy the technology. A healthy ecosystem has a diverse group of customers in different countries and industries — and has either high annual customer growth rates or a large installed customer base.
• End users with high levels of satisfaction. For a healthy ecosystem to develop, end users need to adopt and embrace the technology and become proponents for its growth. For example, though technology managers started out suspicious of bring-your-own-device technologies, execs and sales reps loved them.
• Multiple vendors with strong financials. The survival of a technology in the marketplace depends on the collective resources, investment, cash flow, balance sheets, market reputation, and IP of the main vendors of the technology. Neither a few small vendors nor a single large vendor can sustain a technology’s future.
• Complementary organizations that profit from the technology’s growth. To survive, ecosystems need to build momentum through symbiotic relationships with supporting services and products. For example, mobile app development platforms and partners have thrived by supporting the massive growth in smart mobile devices.
• An absence of strong competitors. New technologies and mature technologies both face competition from other solutions to the business problems that they address. We factor the entrenchment level of older technologies into our assessment of potential replacements using proxies such as vendor concentration, intellectual property rights, installed customer bases, and brand loyalty.
• A vibrant community of experts and evangelists. A healthy ecosystem includes hundreds of evangelists, developers, industry analysts, and certified experts. Without a readily available group of people from product vendors, services firms, and developer forums who are capable of implementing, integrating, debugging, and improving the technology, it will not achieve sufficient momentum to continue.

A Forrester Tech Tide classifies software or hardware, based on maturity and business value, into one of the following categories:

• Experiment. Technologies in this category are characterized by low maturity and low business value. Most enterprises should limit their exposure to these technologies to bounded experiments, waiting for the expected business value of these newer categories to improve before investing.
• Invest. Technologies in this category are characterized by low maturity and high business value. These new technologies have ripened to the point where enterprises can confidently invest.
• Maintain. Technologies in this category are characterized by high maturity and high business value. These are the bread-and-butter technologies that most enterprises rely on to run their business. They’re generally stable, well-understood technologies that continue to have high returns to the business. Most enterprises should maintain their installations and usage of these technologies.
• Divest. Technologies in this category are characterized by high maturity and low business value. These older technology categories have reached a point where their business value has dropped. Most enterprises should be looking for newer, higher-value replacements and should divest from these categories.

The Forrester Tech Tide process includes:

1. Pre-research planning. Prior to writing a Tech Tide, the analyst identifies a relevant domain — an overarching business function or initiative that connects a group of interrelated, adjacent technology categories about which execs at end user companies must make strategic decisions to support growth. The analyst must understand where the Tech Tide on this category fits within our overall portfolio of technology research, including prior art. This includes previous Tech Tides in the same or adjacent domains and New Tech/Now Tech reports that address one or more of the tech categories that will be included in the Tech Tide.

2. Category selection. The analyst selects the most important tech categories — between eight and 20 — to include in the domain. He or she develops inclusion criteria that describe which categories are included and why.

3. Definition of business value and maturity. The analyst sets the guiding metrics for how Forrester will assess the relative business value and maturity of all categories in an “apples to apples” manner.

4. Survey. Via a survey, the analyst gathers data about the categories identified. The Tech Tide applies two evaluation dimensions as part of its methodology: business value and maturity. To accurately assess these, the analyst uses careful definitions in a survey of relevant stakeholders and asks them to rate each tech category by the definitions.

5. Graphic. The analyst uses the survey data, and his or her own judgement, to plot the categories on the Tech Tide graphic. Survey results give us the starting points for placing the categories in the appropriate action box of the Tech Tide graphic, but we modify those results as our experience and judgement dictate.

6. Technology tables. Each tech category is further described in a table graphic. It includes: 1) definition of the category; 2) business value characterization and reasoning; 3) maturity characterization and reasoning; 4) estimated cost to implement; and 5) sample vendors in the category.