Deloitte To Acquire Workday Implementation Specialist Aggressor

Liz Herbert

Deloitte continues to ramp up its software-as-a-service (SaaS) consulting practice, both through organic growth as well as acquisition. Today, Deloitte announced plans to acquire Workday implementation specialist Aggressor. Aggressor has been one of a very small set of Workday integrators (along with Deloitte), which means Deloitte now further boosts its already-impressive Workday practice.

This move furthers Deloitte’s Workday practice, as well as Deloitte’s overall practice in SaaS implementation and integration work. Deloitte also has strategic partnerships with other leading SaaS vendors, most notably salesforce.com.

For buyers, this means a stronger and deeper bench of consultants at Deloitte. But, on the downside, it removes a boutique/specialist option from the market, which appealed to some because of its laser focus, smaller size, and (perceived or real) ability to be more nimble, flexible, and price competitive.

Are you an Aggressor or Deloitte client or prospect? We would love to hear your thoughts!

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Clients Say Big Data Is Now An Imperative (Not Just An Initiative) At IBM's Smarter Analytics Event

Liz Herbert

At IBM's Smarter Analytics event this week, clients and partners presented success stories about how organizations are driving business value out of big data, analytics, and IBM Watson technology.

Examples included:

- City of Dublin, Ireland using thousands of data points from local transportation and traffic signals to optimize public transit and deliver information to riders.

- Seton Healthcare mining through vast amounts of unstructured data captured in notes and dictation to get a more complete view of patients. Seton currently uses this information to construct programs that target treatments to the right patients with a goal of minimizing hospitalizations in the way that most efficiently optimizes costs with benefits. The ability to mine unstructured data gives a much more complete view of patients, including factors such as their support system, their ability to have transportation to and from appointments, and whether or not they have a primary care physician.

- WellPoint using Watson technology to improve real-time decision-making by mining through millions of pages of medical information while doctors and nurses are face-to-face with patients.

But, clients warned that as much as the technology is advancing, the biggest hurdles remained the internal ones. Clients stressed that they face a critical challenge in introducing, driving, and changing the organizational mindset to work in a new way that can take advantage of these great advances in technology. What did they suggest?

1) Executive sponsorship from the top (C-level)

2) Hiring or retraining for new roles like data scientists (schools like Syracuse are introducing and promoting new programs out of their iSchool, which can help with reskilling experienced talent from other areas)

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Oracle Had A Strong Third Quarter, But Well-Informed Buyers Can Still Get Great Deals In Its Q4

Duncan Jones

Oracle reported its results for the three months to February 29th yesterday, and it beat analysts’ expectations. Software license sales were up 15% from last quarter, and up 7% on last year’s Q3. The blogosphere’s “Oraclefreude” delight at its disappointing Q2 appears to have been premature. Enterprises’ insatiable demand for processing power and Oracle’s excellent products ensure a continuing demand for more "per core" license capacity of its flagship database products.

“Oracle is on track to deliver the highest operating margins in our history this year,” said Oracle President and CFO, Safra Catz, in the company’s press release. “Oracle can achieve these record margins as an integrated hardware and software company because we are focusing on high margin systems where hardware and software are engineered to work together.”

What does this mean for sourcing professionals considering Oracle deals in its important fourth quarter to May 31st?

Despite Oracle’s financial rebound, I’m still confident that sourcing professionals with leverage will be able to get better prices in the next three months than they’ve gotten before, provided they use that leverage wisely. Here are three reasons why:

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Why The Recent Infosys/Airtel Deal Is A Glimpse Into The Future Of IT Services

Fred Giron

Infosys announced last week that Bharti Airtel, India’s leading mobile service provider, has selected its WalletEdge platform to operate Airtel Money, the first mobile wallet service in India. This announcement is interesting from a few different perspectives. First, it will provide a new source of revenues for the Indian telecom industry, which has been struggling with low ARPUs for several years. Second, it’s a boon for the banking industry, which will find a way to accelerate financial inclusion initiatives in line with the recommendations from the Reserve Bank of India. Obviously, the urban Indian consumer will also benefit from the “pay anytime, anywhere” convenience of such a service.

I also look at this deal from an IT services industry perspective, and I believe that it embeds a set of very interesting attributes that will become increasingly prevalent in the way IT services vendors engage with their clients moving forward:

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Microsoft Aligns Its UK & Swiss Pricing With The Rest Of Europe, But Not, Alas, With US

Duncan Jones

Microsoft recently announced that it will change to its European currency pricing policy from July 2012, and the effect could be a 20% price increase for UK customers. It didn’t publicize the change, preferring to let its resellers tell their customers as and when the change affects them, so I thought I’d tell my readers what you need to know. Firstly, here is some background. Most global software companies have one master price list in their home currency and reset price lists in other currencies every year or even every quarter using then-current exchange rates. Microsoft has always taken a different approach, having set €, £, and other prices in 2001 and continuing to use the same exchange rate ever since. There are pros and cons to this approach:

·         Pro: local prices are stable and predictable. In contrast, € and £ prices from other US-based vendors may rise or fall by 20% from one year to the next as the currencies fluctuate. (This is one reason why SAP’s revenue rises and Oracle’s falls when the € weakens against the $, as these price changes affect demand.)

·         Con: European companies pay more than their US-based peers. This doesn’t matter so much if you’re only competing with domestic rivals, but global companies see and resent the discrepancies.

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Is This The End Of India's IT Services Success Story?

Fred Giron

I’m currently working on a report entitled “IP-Based Solutions Will Transform The Global IT Services Industry.” In a nutshell, I believe that the business model of IT services firms (consulting firms, systems integrators, and outsourcing firms) will transform from a traditional human capital-intensive model to a software capital-intensive model over the next five years. As I will detail in my report, I believe this transformation will have far-reaching implications on the IT services firms’ organizations, including their sales, marketing, portfolio management, and delivery capabilities.

As I’m based in India, I also see this change as a major disruption for India’s export-oriented IT services industry (AKA “offshore services”). I believe that the growth model for India’s IT/ITeS industry’s in the next 20 years will be much different than it has been for the past 20 years. Software assets — what I also call IP-based solutions — will become critical to the competitiveness of the Indian IT services industry. The recent investments of companies like Infosys, HCL, and NIIT Technologies in such IP-based offerings are strong proof points.

This means a couple of things for the Indian industry:

  • The Indian IT/ITeS industry will create far fewer jobs than in the past. This is what some Indian firms refer to as “non-linear” business models.
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新年快樂. Ancient Chinese Negotiation Tactics, In Honour Of The Chinese New Year

Duncan Jones

I’m always searching for new negotiation best practices and tips when I’m speaking with Forrester clients, but it's not often I find one when I’m relaxing in bed with an old favourite, recently rediscovered book. But here’s one that I hope you’ll find amusing, and educational, from a book written over 80 years ago.

The current Mrs. Jones did some “tidying up” over Christmas — her euphemism for moving my stuff from its organized filing places in her office and dumping it as a jumbled pile on the floor of my office. In amongst a number of unwanted books and DVDs, now available at very reasonable prices on Amazon, I found my ancient copy of Kai Lung Unrolls His Mat by Ernest Bramah. It’s a wonderful book — set in China at some unspecified date in history — and written, so the preface claims, in that country’s classical convoluted style replete with analogies, adjectives, and apophthegms[i]. Read this passage about the ivory carver, Chan Chun, and his lowly assistant, Kin Weng, buying some new tusks from the merchant Pun Kwan — I hope you’ll love it as much as I do.

Pun Kwan and Chan Chun began slowly to approach, the former person endeavouring to create the illusion that he was hastening away, without in reality increasing his distance from the other, while the latter one was concerned in an attempt to present an attitude of unbending no-concern while actuated by a fixed determination not to allow Pun Kwan to pass beyond recall. Thus they reached Kin’s presence, where they paused, the sight of the outer door filling them both with apprehension.

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Software Audits: A Story Of Home Truths, Horror Stories, And Money

Mark Bartrick

Software audits are a bit like public transport; you can wait for ages for a bus and nothing turns up and then all of a sudden five come along at the same time. It shouldn’t surprise anyone that software vendors are running more licensing audits today than ever before. The challenging economic climate has driven down the volume of new license sales for many vendors, so they are looking to backfill that revenue gap by auditing their clients and by finding which ones are using more licenses than they actually purchased.

Looking at Forrester’s inquiries over the last few years, we can see a steady increase in calls asking for help with a Software Audit. The main vendors we see active in the software auditing space at the moment are IBM, Microsoft, Oracle, and SAP. That’s not surprising, as they’re the major software vendors overall. More clients means more audits. And audits certainly aren’t limited to these players; vendors of all sizes are auditing.

But software audits don’t need to be a horror show. If you are well prepared for an audit and have good Software Asset Management procedures in place then you should have nothing to fear. If you aren’t prepared, perhaps in blissful denial that such an event would happen to you, then let this be a warning; in the software audit space, no one can hear you scream.

Un-licensed software usage is easy to miss. There are many potential causes but the outcome is usually the same; you owe more money to the software vendor!

So be prepared. And preparation starts with this: once the audit request arrives make sure you:

  • Understand the vendor’s Audit process
  • Establish a single point of contact within your organization
  • Establish your audit team
  • Get ahead of the audit by thoroughly reviewing your license entitlements and your actual usage before the Vendor’s audit team arrives
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Is Dell Finally Ready To Strengthen Its IT Services Activities?

Fred Giron

In an interview with the Economic Times in India, Dell announced yesterday that it was readying a war chest of about US$1 billion for IT services related acquisitions in India. Here is why I think this announcement is important for Dell:

First, Dell needs to continue strengthen its global delivery network and industrialization capabilities. Dell bolstered its IT services market position with the Perot Systems acquisition in 2009. Since then, the company has made clear its development ambitions in India from an offshore perspective — including during the first analyst event they hosted in India in September 2011. The company lags far behind the services behemoths, including IBM, which has more than 100,000 staff in India working for international clients.

The India domestic market is also becoming a top priority for all major tech vendors. Forrester expects this market to grow by 20% in 2012 in local currency (see my recent report on the future of IT services in India). Japanese companies like NTT Data have launched aggressive inorganic growth strategies to tap this booming market (Dimension Data in 2010 — which was at the time part of the top 10 IT services firms in India via its Datacraft subsidiary — and more recently Netmagic Solutions). And Forrester expects more Japanese investments in the coming few months.

While IBM, HP, and Wipro Infotech are leading the IT services market in India, Dell is still marginal in terms of system integration and managed services activities. So it’s high time that Dell strengthens its presence in India.

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Is Software Pricing A Science Or An Art?

Mark Bartrick

I’ve been with Forrester for just over a month now. It’s great to be involved with our clients and communities and to be helping businesses across the world evaluate the quality of software suppliers' proposals from a commercial perspective (e.g., is this a great deal or can the supplier do better?). One of the best parts of being at Forrester now is seeing the continuation of the work I did prior to joining Forrester — advising businesses on software contract and pricing negotiations. One thing I noticed then, and continue to hear about now, is the reluctance of software suppliers like IBM, BMC, CA, and Compuware to publish meaningful list prices or to explain how their price book worked or how discounts had been determined. Time and again I had to ask suppliers to un-bundle prices and confirm the basis for the net prices they were proposing. Does anyone else agree with me that pricing should be clear and transparent and not a black art?  

Here’s an example of an “art” that should be science: list pricing. While it’s logical to think list pricing is the same foundation upon which all bids are built, that’s actually not the case. Often, I found that my clients were being quoted “list pricing” that was different. Isn’t list pricing supposed to be the same by definition? Which is why you may with good reason doubt the validity of a list price or the competitiveness of a discount that you’re being offered by a software supplier. It’s why I love my work, and why you should make sure you get third-party validation of your deals.

How you do validate your software vendors’ list pricing and proposed discounts?