Introducing the blog challenge on innovation trends

Dear readers and friends of our blog,

Recent conversations with CEOs and managing partners of innovation consulting specialist firms inspired me to write a piece on trends in the innovation consulting services market. This report is nearly done and will be published in a couple of weeks.

You have the chance to receive a free copy of this 10-pager before its official publication. What do you have to do? Simply share your view on trends in innovation with us. My colleague Chris Andrews and I will then select the best three responses from all your comments. The timeline? This challenge will end on Monday 21 September, 2009 at noon EST.

As a starter, let me give you a sneak preview on two of the key trends that I am outlining in my report:

• Most innovation programs focus idea generation, not development. The recession has revealed that at many companies there is not really a dedicated innovation process and framework in place. Many new innovation programs are primarily focused only around the generation of new ideas and on how to constantly grow the pool of ideas. The causal link between large numbers of ideas and greater innovativeness is still the most common form of thinking -- but it is frequently misguided. Companies frequently lack an end-to-end approach to innovation, which is a clear requirement for innovation program success.

• Innovation management solutions do not help if the underlying process is broken. Over the past few years software vendors have emerged which offer dedicated tools for managing and facilitating innovation efforts at companies. However, these solutions primarily focus on the idea and knowledge generation around innovation rather than the management of innovation processes. While only 13% of strategy professionals stated in a recent Forrester survey that they are using a dedicated innovation management tool, such technology tools in themselves are not a solution. Organizations must first establish their own innovation “infrastructure” -- including a business purpose, clearly established innovation leaders, and support from stakeholders. Once companies have institutionalized innovation, executives should select the appropriate technologies that help to govern and support its innovation program.

With this, the blog challenge is now open.

Leave an insightful comment and get the chance to win!

Regards,
Daniel

Dear readers and friends of our blog,

Recent conversations with CEOs and managing partners of innovation consulting specialist firms inspired me to write a piece on trends in the innovation consulting services market. This report is nearly done and will be published in a couple of weeks.

You have the chance to receive a free copy of this 10-pager before its official publication. What do you have to do? Simply share your view on trends in innovation with us. My colleague Chris Andrews and I will then select the best three responses from all your comments. The timeline? This challenge will end on Monday 21 September, 2009 at noon EST.

As a starter, let me give you a sneak preview on two of the key trends that I am outlining in my report:

• Most innovation programs focus idea generation, not development. The recession has revealed that at many companies there is not really a dedicated innovation process and framework in place. Many new innovation programs are primarily focused only around the generation of new ideas and on how to constantly grow the pool of ideas. The causal link between large numbers of ideas and greater innovativeness is still the most common form of thinking -- but it is frequently misguided. Companies frequently lack an end-to-end approach to innovation, which is a clear requirement for innovation program success.

• Innovation management solutions do not help if the underlying process is broken. Over the past few years software vendors have emerged which offer dedicated tools for managing and facilitating innovation efforts at companies. However, these solutions primarily focus on the idea and knowledge generation around innovation rather than the management of innovation processes. While only 13% of strategy professionals stated in a recent Forrester survey that they are using a dedicated innovation management tool, such technology tools in themselves are not a solution. Organizations must first establish their own innovation “infrastructure” -- including a business purpose, clearly established innovation leaders, and support from stakeholders. Once companies have institutionalized innovation, executives should select the appropriate technologies that help to govern and support its innovation program.

With this, the blog challenge is now open.

Leave an insightful comment and get the chance to win!

Regards,
Daniel

Nortel’s Fate Is Still in the Wind – but not for long

I have just returned from the Annual International Nortel Networks Users Association (INNUA) Meeting in Pittsburgh, PA.  At the event, I was again struck by the loyalty of the Nortel customer base.  There were 1,500 some in attendance.  I saw Nortel customers and partners who hailed from Boston to San Francisco and  as far away as Denmark, India, and Brazil.  Nortel had a group of nearly 250 partners from the Carribean and Latin America in town for training as well.  Attendance was down considerably (nearly cut in half) compared to last year, but those who were in attendance were serious – considering their options and Nortel’s future.  While Nortel compared their history to Pittsburgh’s – a gritty town with staying power that has reinvented itself for the new economy – customers really wanted to know about the future. Nortel preferred to focus on comparisons to the six  time World Champion Pittsburgh Steelers – customers wanted to compare then to the Pittsburgh Penguins wondering whether they could pull off one more win to take the Cup. 

Through the time I spent at the event Nortel executives hammered on their message of continuing transformation for the company.  CEO Mike Zafirovski focused on the commitment his executive team was making to Nortel employees, customers, products and technologies.  His ultimate aim was to find a way for all of them where they could prosper – while Enterprise General Manger Joel Hackney focused on the continuing success of Enterprise initiatives and future plans for new products and services.  Customers and partners were buying the vision, and wanted to know how it would be implemented.  Mike and Joel announced that they expect answers would begin to be delivered within about  month, and quickly departed for an unscheduled trip –presumably to pursue negotiations related to answering that question.

At this point, I believe that Nortel is committed to putting their products and employees into the market as part of a larger organization, capable of generating the scale of operations to succeed in a consolidating global market.  That means a business combination with another entity with complimentary capabilities – and Nortel is not in a position to buy.  So the question is “Who might buy Nortel assets and business operations?”  Likely not a single entity, as few organizations other than Alcatel-Lucent, or perhaps Huawei, have the breadth of voice and data communications businesses across Enterprise and Service Provider to provide a home for Nortel’s varied product lines.  Siemens and Avaya are the options Nortel enterprise customers ask about most frequently.  European and Latin America customers seem to like the Siemens option as it provides them the potential for smother interactions and greater attention.  A couple customers were curious if an Avaya acquisition would enable them to streamline their heterogeneous infrastructures, but partners worried about what the combined Avaya-Nortel channel model would look like.  Delivery of services related to Unified Communications in particular has become an uneasy market with channel partners worried about Nortel’s ability to deliver services without competing directly – and no one at the INNUA conference was confident that they could count on Avaya’s new focus on indirect sales and delivery for the longer term.

In short, Nortel’s customers demonstrated loyalty and commitment to Nortel – and Nortel returned the commitment at this user group meeting, but the details of how these intentions and commitments will be fulfilled are still in the wind. 

 

Henry Dewing

The end of the highly diversifed organization...

...represents a real opportunity for M&A services providers. While conducting my research into the M&A and broader corporate strategy services space, I observed that business intelligence and performance management (BI&PM) programs are still very high on the executive agenda. Increased investment in analytic capabilities, as well as moves to becoming more sophisticated and transparent, will lead to the end of the highly diversified organization. Why? With these new capabilities companies will have a better picture of their portfolio and will be able to more wisely invest/divest into core/non-core-related assets. In the next 4-5 years we will see -- induced/accelerated by the recession -- that companies will move closer again to their core business, and not only for cost reasons. Hence BI&PM will fuel M&A activity and also lead to better M&As. I am postulating that there is a positive correlation between "analytic maturity " and " M&A maturity". I already had great conversations with some of you around these assumptions, but would like to broaden the discussion. Two questions for you:

1. Do you agree?

2. How are/would you measure "analytic maturity" and "M&A maturity" of a company?

Curious to hear your thoughts.

Best,
Daniel

Do You Like To Be Benchmarked?

By Peter O'Neill

I have just completed a benchmarking excercise where we invited various IT vendors to tell us about their Channel Incentive Operations as a basis for a research report we will publish in the summer.
Many of the vendors we contacted were suprised that we do this type of research at all, but Forrester clients are getting used to this as we expand our library of reports for vendor strategists. 
Those vendors who did talk to us get, in return for their providing us highly-sensitive operating cost and headcount data, illuminating benchmark feedback so that they have an idea of how they operate compared to their peers. The feedback phase starts next week and we have 10 vendors in the benchmark so a good comparison can be made. The funniest interview was with a very high ranking executive of one vendor (so clearly, they thought it was important to talk to Forrester) who then had to tell me
every five minutes, "I am sorry, we cannot give you that information" -- a total waste of his and my time. 

In our prospecting for interviews, several vendors told us that they did not wish to participate in this excercise, which is reasonable, but nobody told us never to come back with another idea.  

We would like to more benchmarking and write it up in reports. We see the opportunity for Forrester to acquire the role as mediator within the industry for comparing notes between peers without revealing secrets to competitors. That is our idea but we’d also like your feedback. Do you agree with us? Please leave a comment for us below on this. Thanks.
 
Always keeping you informed!
Peter

IBM Tivoli's SMB Strategy

This week, IBM introduced its first two IT management appliances targeted at small and medium businesses. These first two solutions are part of a family that will eventually cover all the IT management needs of an enterprise, and cover availability and performance (IBM Tivoli Foundations Application Manager) and service desk IT services (IBM Tivoli Foundations Service Manager). The benefits expected are a rapid deployment at a lower cost due to the inclusion of automated configuration and deployment solutions. by itself, this is not really new and neither is it a complete revolution. Years ago, Oculan (now part of Raritan) and off shout of the Open NMS effort, presented a network management appliance for SMBs, with a similar strategy: sell exclusively through partners who can add their own flavor of services to the solution.

Beyond the technology, I find that this announcement is another signal of things to come in IT. IBM, years ago (in 1975 if I remember correctly) started the software revolution by unbundling software from hardware on its mainframes. This was a signal that the process of building hardware was now entering a phase of reduced costs and increased competition leading to thinner margins, which could no longer sustain the cost of software. We then entered a spiral which saw the emergence of Moore's law, by which the density of transistors on a chip doubled every 18 months. This continuous process improvement lead to an exponential decline of hardware prices starting in the late 80s. Of course, because hardware resources became abundant and cheap, software started to follow the same route: the number and size of applications followed their own version of Moore's law.

We are now facing another issue: as the hardware development process continues to improve, and the software development process follows suit, the ancillary processes of deploying, operating and maintaining all these technologies are becoming a burden on IT budgets, and are in fact slowing down the whole technology adoption process. The next issue we are facing is one of human resources in IT operations, and it will only be solved by a continuous improvement of the global IT process, first by rationalization (ITIL, ISO, etc.), then by automation of the rationalized processes.

Technology has of course a role to play in this overall march to process improvement. Virtualization, automation, integration of disciplines into cloud computing, all will participate in the operational cost reduction.

I see IBM Tivoli's announcement as an important signal towards this transformation of IT towards the manufacturing equivalent of mass production: delivering a ready to consume technology rather than parts that the user has to assemble. I see this as the future of IT. It will take years until this is fully adopted and IT operation transforms from a cottage industry into a rational factory, but eventually this is where we are going. The fact that IBM, with all its might, brand and reputation goes in this direction is a validation of the IT factory future.

Regards,

JP Garbani