Huawei’s New Switch Looks Promising, and its Storyline Needs Reinforcing

Clement Teo

by Clement Teo, Bryan Wang, Katyayan Gupta

We recently met with Huawei executives during the launch of its latest product in China, the S12700 switch.  The product, which ships in limited quantity in Q1 2014 is designed for managing campus networks, and acts as a core and aggregation switch in the heart of campus networks. While wired/wireless convergence, policy control and management come as standard features, the draw is the Ethernet Network Processor (ENP). The ENP competes against merchant silicon in competitive switch products, and Huawei claims to be able to deliver new programmable services in six months, compared to one to three years for competitive application-specific integrated circuit (ASIC) chips. This helps IT managers respond quicker to the needs of campus network users, especially in the age of BYOD, Big Data, and cloud computing.

While it is a commendable product in its own right, Huawei will need to position its value more strategically against IT managers that have technology inertia, especially in ‘Cisco-heavy’ networks:

  • Tying the value of the switch to existing and future enterprise campus needs. In the age of cloud computing, big data, mobility, and social networking, IT managers need to solve network challenges like insufficient service processing capability and slow service responses. Huawei says the new switch is able to provide agile services and respond flexibly to changes in service requirements, on demand. For example, the switch has access control built in for wired/wireless access management. This is a good start. Enterprises will need to understand how the switch plays a central role in a campus network, and Huawei should continue to reinforce its agile network architecture’s storyline.
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Non-Tech Companies Emerge As A Critical New Market For Software Product Development Services

Charles Green

Historically, one of the main segments of the product development services (PDS) market has been software product development for independent software vendors (ISVs). My colleague John McCarthy and I have just published a report that outlines how this market is undergoing a significant shift as it splits between serving the traditional ISVs and serving what Forrester refers to as “software-is-the-brand” companies.

Software-is-the-brand companies are those firms in industry sectors like financial services, retail, information services, and media and entertainment that are seeing more and more of their business value coming from their software-based products and services. This new segment will comprise the majority of growth in the software PDS market over the next four to five years.
 
This growth will occur as these companies increasingly require high-end product development capabilities for what, in many cases, were seen as traditional IT projects. My colleague Christine Ferrusi Ross recently wrote how technology has become the supply chain for these software-is-the-brand companies because it is the “raw material” that allows today’s products to be built. Frequently, however, these companies need help from service providers to acquire the appropriate skills and expertise to handle the current complexity and speed of technological change.
 
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Strengthening The Link Between Software Sourcing And Supplier Management

Duncan Jones

I’m part of a team called “sourcing and vendor management” (SVM). Forrester organizes its research teams by individual client roles, so my teammates and I all focus on helping clients who are sourcing and vendor management professionals. Wait a moment. Should that read “helping clients who are sourcing or vendor management professionals”? Aren’t they separate functions within a client’s organization? This is a frequent question from our clients, and one that causes a lot of internal debate within our team.

My view, formed from witnessing the experience of hundreds of enterprises, is that, at least in the software category, sourcing and supplier management should be very closely linked, but not via org structure and reporting lines. This is because:

·         It is impossible to manage software suppliers effectively unless you can influence sourcing. The major players are so big and powerful that they usually have the upper hand in discussions about maintenance renewals and service levels. Even small software providers can build immovable, entrenched positions in their chosen niches. To have sufficient negotiation leverage to do a good job, the supplier manager must be able to credibly threaten to negatively impact the supplier’s ability to win future business.

·         Sourcing is infrequent but intensive, whereas supplier management is continual. The former consumes huge amounts of time and effort for a relatively small period, which risks dropping the ball on monitoring while you’re immersed in a big negotiation, or missing opportunities on the sourcing side due to distractions from the ‘day job’. You therefore need different people handling each side, but collaborating closely with each other.

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Tata Communications Lays A Foundation For Targeting Enterprise Accounts

Clement Teo

Tata Communications has emerged from its role as an incumbent Indian service provider to become a globally recognized provider of network connectivity services such as MPLS, Ethernet and IP transit as well as managed hosting in data centers, voice, data, and video.

It was also rated as a strong performer in the Forrester Wave on Managed Global MPLS Q1 2013- a rather impressive showing for a service provider that only just joined this year’s edition of the MPLS Wave report.

More importantly, it has started to become relevant to enterprise network connectivity buyers across Asia Pacific, which is detailed in my report, “Tata Communications Emerges As A Leading Connectivity Provider In Asia Pacific”.

What It Means

  • Tata Communications is starting to measure up to global carriers. I’ve received a number of inquiries on Tata Communications’ regional and global carrier wholesale strategy, as well as its market focus. This increased interest among Forrester clients is a sign that Tata Communications is getting some things right in its carrier business, as the aforementioned global MPLS report makes clear. Its continual network and cable investments are paying off for the service provider.
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THE PRIVATIZATION OF CHINESE IT SERVICE PROVIDERS – SHOULD YOU BE CONCERNED OR EXCITED?

Gene Cao

With Frederic Giron

On June 6, iSoftStone announced plans to make the company a wholly owned subsidiary of China Asset Management Co., Ltdand delist from the U.S. stock market. This is the fifth IT services (ITS) provider headquartered in China to announce plans to go private in the past 9 months. The others were Yucheng Technology, AsiaInfo-Linkage, Camelot and Pactera.

Why are these firms going private? Despite ambitious global growth plans, Chinese ITS providers have largely failed to articulate a compelling value proposition to U.S. and European clients. By focusing mainly on low-end application development services they have instead primarily competed with much bigger and much more experienced Indian providers – but without the ability to offer lower costs. In fact, the average profitability of Chinese ITS providerswent down from 10-15% to less than 5% over the past 2 years, when most large Indian firms are in the 15-25% range. Going private will give these5companies a chance to transform their current model relieved from the quarterly pressure to meet Wall Street analyst expectations.

Existing and potential customers of these ITS providers may have concerns seeing these providers going private, particularly regarding overall company transparency, including financial strength and corporate governance. I believe clients will have to balance their concerns against the potential benefits that going private may deliver, which include:

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ORANGE BUSINESS SERVICES ANALYST EVENT 2013: THE COBBLER STICKS TO HIS LAST

Clement Teo

Brownlee Thomas, Ph.D., Dan Bieler, Henning Dransfeld, Ph.D., Bryan Wang, Clement Teo, Fred Giron, Michele Pelino, Ed Ferrara, Chris Sherman, Jennifer Belissent, Ph.D.

Orange Business Services (Orange) hosted its annual analyst event in Paris July 9th & 10th. Our main observations are:

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ORANGE BUSINESS SERVICES ANALYST EVENT 2013: THE COBBLER STICKS TO HIS LAST

Fred Giron

Brownlee Thomas, Ph.D., Dan Bieler, Henning Dransfeld, Ph.D., Bryan Wang, Clement Teo, Fred Giron, Michele Pelino, Ed Ferrara, Chris Sherman, Jennifer Belissent, Ph.D.

Orange Business Services (Orange) hosted its annual analyst event in Paris July 9th & 10th. Our main observations are:

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Google Enterprise Services – Worth A Second Look

Clement Teo

Google is officially serious about the enterprise space. I met with Google Enterprise execs hosting their very first analyst day in Singapore recently, and was introduced to their enterprise suite of services, which was, unsurprisingly, similar to their consumer suite of services.

However, while they took their starting point from the consumer end, providing enterprise-ready solutions requires a different level of product calibration. To that end, Google cites spending of approximately US$3 billion annually on building/improving its data center infrastructure, investing in undersea cable systems, and laying fiber networks in the US specifically. In Asia Pacific (AP) last year, they spent approximately US$700 million building three data centers in Singapore, Hong Kong, and Taiwan.

In addition to infrastructure investments, Google has also acquired companies like Quickoffice to enhance their appeal to enterprises weaned on Microsoft Office, while also expanding existing offerings in areas like communications and collaboration (Gmail, Google Plus), contextualized services (Maps, Compute Engine, Big Query), access devices (Nexus range, Chromebook), application development (App Engine) and discovery and archiving (Search, Vault).

What It Means

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Deciphering The Maze Of Business Intelligence Analytics Technologies

Charles Green
Image from http://loobenji.deviantart.com/art/Maze-130232999Since 2010, when Forrester asks about organizations’ top software priorities, the number one ranked priority has been business intelligence (BI). Continued economic uncertainty and major industry-changing dynamics like mobility and the shift to digital business put a premium on data and information. The ability to effectively extract, analyze, and interpret vast quantities of data has simply become critical to business strategy decisions. Investments in BI analytics reflect the importance being placed on these technologies.
 
However, the large number of analytics technologies at differing levels of maturity and adoption has, in many cases, left planners of BI confused as to which technology should be adopted and for which scenario.
 
As a result, my colleague, Holger Kisker, and I used Forrester’s TechRadar methodology to examine 15 key analytics technologies to identify their usage scenario, current maturity within the enterprise, future trajectory, key vendors, as well as estimated costs for implementation. The technologies analyzed included the following: reporting, dashboards, performance analytics, embedded analytics, web analytics, process analytics, predictive analytics, OLAP, advanced visualization, metadata-generated analytics, location analytics, search/discovery, streaming analytics, nonmodeled data exploration and discovery, and finally text analytics. Forrester clients can read the full report here.
 
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HCL Injects Innovation Into The Next Generation Of Product Development Services

Charles Green
In 2011, Forrester first reported on a new breed of mature and collaborative product development services (PDS) offerings coming to market, which we called “product development services 2.0.” These services are a stark contrast to traditional staff augmentation engagements. How are they different? Providers take greater responsibility for the end-to-end life cycle of the product, promise a higher level of industry and domain expertise, and offer a value-add service addressing key client business concerns. The transition has been gradual up to now, but there are finally signs of a more rapid shift.
 
One of the key announcements made in recent months was HCL’s launch of its “Service Line Unit” (SLU) initiative. Here are the key elements of this initiative:
 
SLUs are a packaged set of PDS offerings, bringing together relevant HCL tools, partnerships, processes, and delivery competencies to address specific pain points.
In developing these offerings, HCL systematically investigated the white space and the key business challenges in its chosen target markets. In turn, it invested in building out its own IP and domain knowledge to address these challenges.
Ultimately, these investments and the targeting of specific business concerns will help HCL frame its service offerings in the context of key business outcomes, such as time-to-market.
 
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