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CEN Member Chat: Industry Sector Transformation is Smart Business

CEN Member Chat: Industry Sector Transformation is Smart Business

Andy Mulholland, Constellation VP & Principal Analyst, shares lesson learned and tips for success in tackling industry sector transformation. He covers John Deere, Honeywell, Uber, and GM. Our Constellation Insights editor also shares what's hot. 

If you are not a Constellation Executive Network member yet, join our analysts in this private community to talk shop and solve business problems in real time. 

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Constellation ShortList for B2B and B2C Marketing Automation Published

Constellation ShortList for B2B and B2C Marketing Automation Published

Last week marked the launch of The Constellation ShortList™, an open research initiative by our team of analysts to help guide organizations on their technology stack selections.  My first ShortList on Configure Price Quote (CPQ) technologies was released last week, and today marks the launch of my Business to Business (B2B) and Business to Consumer (B2C) Marketing Automation ShortLists.
 
Today’s customer is facing more noise in this digital age than ever before and marketers have the tough job of competing for their time and attention.  Buzzwords like “One-to-One Marketing”, “Account Based Marketing”, “Personalize the Journey” are created every day as potential initiatives for the Marketing team to consider.  At the same time, there’s never been more science required by the CMO to justify campaign spend, prove ROI, measure the conversion-to-close from lead-to-customer. More CMOs are held to revenue targets and data analytics skills are a key criteria for today’s marketing hires. Marketing Automation facilitates the process required to effectively engage, track, and measure each step along the customer life cycle beginning from campaign execution to post-sale reporting. 
 
One distinction I wanted to make was to separate my B2B, B2C Marketing and upcoming Sales Force Automation (SFA) ShortList, by solutions suitable for Enterprises and Small/Medium Businesses.  Not every organization has the marketing and sales administrative staff or budget to afford some of the more well-known solutions in the market, so I have made the distinction to help organizations with more limited resources find a solution that works for them.
 
You can read both ShortLists by accessing the links below:
Read the Configure Price Quote (CPQ) ShortList released last week, here
 
For more information on The Constellation ShortList™, visit https://www.constellationr.com/shortlist
 
Note: The goal of the ShortList is to provide busy executives a quick run-through of the top solutions by category.  The companies and solutions included were determined through the following criteria:
  • Client inquiries
  • Customer references
  • Vendor selection projects
  • Technology evaluation
  • Market share 
  • Internal research
Marketing Transformation Chief Marketing Officer

Constellation ShortList™ for Customer Experience (CX) Services: Global

Constellation ShortList™ for Customer Experience (CX) Services: Global

The Customer Experience (CX) Services Global List acknowledges leaders in driving customer experience excellence in organizations. The Constellation ShortList presents vendors in different categories of the market relevant to early adopters. In addition, products included in this document meet the threshold criteria for this category as determined by Constellation Research. This Constellation ShortList of vendors for a market category is compiled through conversations with early adopter clients, independent analysis, and briefings with vendors and partners.

A systems integrator (SI) or customer experience (CX) service provider brings together solutions into an overall customer experience hub. They work with all functional departments, such as marketing, sales, customer service, supply chain, ecommerce, IT, digital performance management (DPM) and back-office systems. With SaaS solutions, the SI’s role is changing to focus on strategy, tactics and choosing technology. Customer experience SIs guide brands’ CX journeys on all channels (e.g., email, chat, text, websites, phone, social networks) and devices (e.g., phones, tablets, desktops), and optimize each to make the experience flawless.

With options to order on a website and pick up in a store or ship to an address, front-end experiences need to be great, along with top-notch supply chain/ERP so inventory is current. In addition to customer journey mapping and choosing omnichannel technology, they focus on DPM to ensure websites load quickly and shopping carts don’t get hung up or abandoned, while mitigating lost revenue. 

CX SIs have a set of best practices, strategy design, optimal delivery, and testing methodology to guide clients to obtain an optimal CX from a customer’s point-of-view. These firms often perform a gap analysis (comparing the current and future state of the customer experience to find gaps). SIs use gaps to create a long- and short-term road map, emphasizing low-hanging fruit and large ROI. SIs often incorporate organizational change management.

Constellation considers the following criteria for these solutions: 

Best practices methodology 

An assessment tool  

Create strategy and technology roadmap  

Customer references  

Differentiated IP 

Customer success management  

Operating in three continents

Constellation evaluates over 100 solutions categorized in this market. This Constellation ShortList is determined by client inquiries, partner conversations, customer references, vendor selection projects, market share, and internal research.

 
Enterprise Service Providers / System Integrators / Management Consultants:  

  • Accenture
  • Bain
  • Boston Consulting Group 
  • Capgemini 
  • Deloitte  
  • Ernst & Young  
  • IBM Global Business Services 
  • Infosys  
  • McKinsey 
  • SapientNitro  
  • Wipro

For more information about this short list, please see the Constellation Research website.

@DrNatalie Petouhoff, VP and Principal Analyst, Covering Customer-facing Applications

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Constellation ShortList™ for Digital Performance Management

Constellation ShortList™ for Digital Performance Management

Digital Performance Management provides companies with the analytics to determine if their customer experience is optimized. The Constellation ShortList™? presents vendors in different categories of the market relevant to early adopters. In addition, products included in this document meet the threshold criteria for this category as determined by Constellation Research. This Constellation ShortList of vendors for a market category is compiled through conversations with early adopter clients, independent analysis, and briefings with vendors and partners.

Mastering digital performance management (DPM) is one of the leading challenges of the digital economy. Often referred to as application performance management (APM), it requires a joint effort between many functional departments, such as marketing, sales, customer service, ecommerce and IT. It is no longer just about IT looking at the performance of the technology stack or the management of the infrastructure or cloud that delivers customer experience. 

Today, it’s about the collaboration between the lines of business and IT to measure and manage the end-to-end transaction delivery and translate it into actionable information that a brand can use to optimize customer experience, as well as the performance of the technologies used to deliver it. When DPM is optimized, companies can deliver an engaging digital experience, maximize revenue and improve brand loyalty. DPM vendors help both the business and engineering teams to not only define conversion and revenue goals but also make sure they are reached.

They make sure the application’s performance doesn’t become a roadblock to optimal customer experiences and reaching business metrics, including conversion rates, high availability and high user experience indexes. The goal is to monitor and measure to eliminate all revenue barriers with a strong focus on digital performance to ensure that the road to conversion is quick and easy; the customer experience is smooth; and customers remain loyal as a result.

Constellation considers the following criteria for these solutions: 
  • Monitoring of each customer’s journey and business transactions, using intelligent analytics
  • Proactive application monitoring for quick problem resolution and maximum availability 
  • Full insights into each customer’s journey to make better business decisions
  • Connect the dots between customer experience, application performance and business outcomes 
  • Full technology stack monitoring with deep operational insights into the user’s application environment 
  • Big data monitoring and data visualization 
  • Mobile application monitoring  
  • Cloud, server and mainframe monitoring 
  • Load testing, virtualization and network monitoring 
  • Customer behavior analytics.

Constellation evaluates over 25 solutions categorized in this market. This Constellation ShortList is determined by client inquiries, partner conversations, customer references, vendor selection projects, market share and internal research. 
These are the best-of-breed vendors that provide applications and services without bundling into another platform: 

  • APM+  
  • AppDynamics  
  • Dynatrace  
  • NeoSense 
  • Oracle  
  • SAP  
  • SOASTA.

For more information, please see the Constellation Research website.

@drNatalie Petouhoff, VP and Principal Analyst, Covering Customer Facing Applications

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B2B Marketing Automation Makes Its Debut in the Constellation ShortList Program

B2B Marketing Automation Makes Its Debut in the Constellation ShortList Program

In the digital era, companies are competing for buyer time and attention. The multitude of campaign channels - ranging from social media, Web programs, content marketing, advertising and events - requires companies to consider systems that can orchestrate across channels to ensure quality buyer engagement. Marketing automation provides B2B companies with an efficient way to attract, capture, engage and nurture customers, enabling marketers to deliver qualified, sales-ready leads and provide post-sale nurture for upsell and cross-sell opportunities.

Today, Constellation published a Constellation ShortList™ for B2B Marketing Automation. This Constellation ShortList helps companies choose the B2B Marketing Automation tools that will help them achieve their digital transformation goals. Here are the companies that made the Constellation ShortList:

Enterprise Solutions

  • Adobe Campaign
  • Oracle Marketing Cloud
  • Marketo
  • Salesforce Pardot

SMB Solutions

  • Act-On
  • eTrigue
  • Hubspot
  • Salesforce Pardot

Constellation advises early adopters using disruptive technologies on how to achieve business model transformation. Products and services named to this Constellation ShortList meet the threshold criteria for each category as determined by Constellation Research through client inquiries, partner conversations, customer references, vendor selection projects, market share and internal research.

Additional lists released today include:

This is the second set of lists we’ve released for this program. If you missed last week’s update, check it out here. We will be rolling out nearly 40 Constellation ShortLists authored by our analysts across a range of technologies over the next few weeks.

For more information, visit https://www.constellationr.com/shortlist, or inquire directly by contacting [email protected].

New Research: How Blockchain Security is Evolving

New Research: How Blockchain Security is Evolving

Security for blockchains and more advanced Distributed Ledger Technologies (DLTs) is evolving rapidly.  As soon as interest in the original blockchain grew past crypto-currency into mainstream business applications, it became apparent that the core ledger would need to augmented in several ways.  

The naked blockchain by nature has to be open to all participants, to achieve the scale needed to keep out corruption of Bitcoin, but in real world business, account holders need to be subject to entry rules, and the "miners" that support the network need a governance, system.  These considerations lead to with permissioned blockchains with access controls.  Another enterprise requirement is confidentiality; most businesses need their records generally kept out of the public domain, and that means encryption or blockchain entries before they are lodged.

Access controls and encryption might be regarded as conventional security layers, but what few people appreciate is that these measures conflict with the rationale of the original blockchain algorithm, which was expressly meant to dispel administration.  

My new Constellation Research paper looks at these tensions, what they mean for public and private blockchain systems, and provides some detailed guidance for blockchain technology security: 

  • Permissioned blockchains and private DLTs must implement access controls to determine who has the appropriate privileges to write to the ledger.
  • Remember that any administrative agencts operating off-chain dilute the benefits of Proof of Work algorithms.
  • If confidentiality is required for sensitive data written to a public blockchain, then additional key distribution and management is needed, but these can create single points of failure needing mitigation.
  • Private DLTs become much more concentrated compared with pure blockchains, and need administration to protect against insider threats and to prevent fraud.  
  • The quality of cryptography in all customised DLTs is critical. Algorithms must be correctly programmed and must execute without interference.
  • Hardware Security Modules (HSMs) are increasingly practical, thanks to dedicated cloud HSM options emerging at cloud providers and should be considered. HSMs should be certified to Common Criteria EAL4+, or FIPS 140 level 3+.
  • Software quality in general must not be overlooked. Bugs in “smart contracts” and novel blockchain cases like the “Distributed Autonomous Organization” (The DAO) have made the headlines. DLT projects must take care of the software development lifecycles. 

 A snapshot of "How to Secure Blockchain Technologies" can be downloaded here

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New Research: Guidance on Blockchain Technology R&D

New Research: Guidance on Blockchain Technology R&D

Over September 26-27 I was a guest speaker at the US Department of Health & Human Services blockchain for healthcare workshop.  It was a fascinating and worthwhile exercise, as I reported in more detail here.  However, I have to say most of the presentations confirmed my view that blockchain application development leaves a lot to be desired.

Too often, blockchain-based solutions fall short of good design practice.  They typically fail to set out the problem they're really trying to solve, and instead start with the working assumption that blockchain is an inherently valuable part of the end solution.  In the current craze, people tend to treat blockchain is the end and not the means. 

There were three noticable problems with the blockchain for healthcare proposals, taken as a whole: 

  1. They tended to misunderstand what blockchain does.  As I've canvassed elsewhere, the original Bitcoin blockchain only does one thing: it reaches consensus on the order of entries in a ledger.  It does not and cannot decide anything else about the entries.  And so it does not have a lot to contribute to the health IT problem of interoperability. 
  2. They tended to overestimate blockchain as a database.  Several papers submitted to the workshop claimed blockchain could help federate the many disparate and siloed health information repositories, improving on the probematic Health Information Exchange (HIE) model.  However, as the workshop progressed, all parties agreed that the blockchain should not be used to hold significant health data, because it's public by nature, and limited in capacity. So if blockchain isnt going to store health data, it cannot help shift health data from its current silos. 
  3. And none of the blockchain papers tackled the challenge of key management. When permissions and confidentiality need to be layered on top of the core blockchain, and the necessary key management arrangements are inplace, the distributed ledger technology actuallt becomes inconsequential.  

If distributed ledgers hold some promise in e-health, there needs to be a clear problem statement and a stronger R&D pathway, to take us from the first generation prototype blockchain, to second and third generation DLTs and beyond. 

I have published a new research report seeking to improve how blockchain-related R&D is conducted

The ad hoc way in which permissions and encryption is added to blockchain is just one example of overly hasty "innovation". In the rush to apply blockchain to mainstream applications, few entrepreneurs have been clear about the problems they think they’re solving.  If DLT R&D is not properly grounded, then the resulting solutions will be weak and will ultimately fail in the market.  The original blockchain was truly only a prototype; greater care is needed to reliably adapt the first generation algorithms to enterprise requirements. 

The report examines four strong research organisations in this space: the Hyperledger Foundation, Microsoft's Azure Blockchain as a Service, the banking industry joint vernture R3, and Ping Identity with its investment in the startup Swirlds. 

If your organisation needs to conduct its own R&D then the following checklist can help you stay on track: 

  • Do you have the equivalent of a Double Spend problem? If the order of transactions is not critical or if it’s not really possible for assets such as physical objects to be exercised twice, then the original blockchain is probably not a natural for your use case.
  • Are your assets purely digital or do you have physical assets that need mapping onto the ledger? Any mapping or translation of physical assets onto ledger entries logically needs to be done off-ledgewith authority structures that erode the pure blockchain architecture.  
  • Do you need immutability? The degree of permanence provided by the public blockchains is rarely needed in conventional business, and may not be worth the cost. 
  • Does your environment have administrators? Blockchain was expressly designed for a special case where central admin is banished.  Conventional business lines of command and authority structures can be at odds with the blockchain consensus algorithm. 

For more information, a snapshot of the report is available here.  

 

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Introducing Constellation's Latest Product

Introducing Constellation's Latest Product

One of the things I love about Constellation Research is how the firm practices what it preaches.  Everything we talk about of course relates to innovation, but we are ourselves innovating all the time. For example, internally, our production process is constantly trying new ways to streamline how research gets converted into high grade publications.  

Externally in the past twelve months we opened up the Constellation Executive Network which provides new ways to access or research and analysts.  And last week we launched the latest Constellation Research product: the Constellation ShortList™

The Constellation ShortList program provides technology buyers a curated list of solution providers to consider in their pursuit of digital transformation in a wide range of categories.  Products and services named in each Constellation ShortList meet particular threshold criteria in each category, as determined by Constellation Research through ongoing client and partner conversations, customer references, market share, mind share, publications, and our continuous internal research.  Each list is updated by its responsible analyst on a short cycle -- typically every three months -- so our clients always have an up-to-date guide to help them save time in competitive technology evaluation.  

My first Constellation ShortLists were published last week. 

Cloud Identity Management (CIM)  

CIM is a natural evolution of hosted identity management services, and has boomed over the past three years.  At this stage I have short-listed (in alphabetical order) CA Technologies, ForgeRock, IBM,   Microsoft, Okta, OneLogin, Ping Identity, Salesforce, and VMware.  This is a particularly dynamic category, so watch this space for new entries and exits! 

Distributed Ledger Labs (DLTs) 

DLTs are the natural progression of blockchain, expanding the vision of this decentralised secure data structure from cryptcurrency to mainstream applications.  They are highly complex, and until commoditised, buyers should stick to the large research consortia or laboratories. For now I have short-listed (in alphabetical order): R3, Hyperledger Foundation, Microsoft Azure Blockchain as a Service, and Ping Identity / Swirlds. 

 

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Constellation ShortList™ for Customer Experience (CX): IOT Platforms

Constellation ShortList™ for Customer Experience (CX): IOT Platforms

Customer Experience (CX): IOT Platforms are the platforms that make IoT come to life. The Constellation ShortList presents vendors in different categories of the market relevant to early adopters. In addition, products included in this document meet the threshold criteria for this category as determined by Constellation Research. This Constellation ShortList of vendors for a market category is compiled through conversations with early adopter clients, independent analysis, and briefings with vendors and partners.

Developing products for the Internet of Things (IoT) is a complex endeavor. Because most organizations lack the resources and skills for custom app development, successful projects require development on an IoT platform or solution. IoT data solutions offer a place to start by combining many of the tools needed to manage a deployment from device management to data prediction and insights, all into one offering. For customer experience offerings, Constellation has identified a range of platform providers, including pure-play third-party platforms, hardware vendors, connectivity providers and system integrators. Having an end-to-end ecosystem strategy means a company doesn’t have to develop their own modules, network stack or cloud onboarding.

Constellation considers the following criteria to be considered an IoT Platform for CX. One of the key characteristics is to be able to connect data from every device, sensor, website, etc. and is built on a scalable event processing engine designed to ingest and analyze billions of connected events: 

  • End-to-end ecosystem strategy 
  • Reliably scale to billions of devices and trillions of messages  
  • Manages up to 500,000 assets and 100,000 device messages per second 
  • Cloud infrastructure as a white-label subscription service  
  • Web-scale processing, analytics and machine intelligence  
  • Ultra-low latency  
  • Augmented reality integration  
  • Messaging broker supports connections using native MQTT and WebSockets MQTT.

Constellation evaluates over 25 solutions categorized in this market. This Constellation ShortList is determined by client inquiries, partner conversations, customer references, vendor selection projects, market share and internal research. 
The list includes:  

  • AWS IoT  
  • GE Predix  
  • Google Cloud Platform IoT  
  • Microsoft Azure IoT Suite  
  • ThingWorx  
  • Salesforce IoT Cloud  
  • Lively.

For more information, please see the Constellation Research website.
@DrNatalie Petouhoff, VP and Principal Analyst, Constellation Research, Covering Customer-facing Applications

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Blockchain, Healthcare and Bleeding Edge R&D

Blockchain, Healthcare and Bleeding Edge R&D

Last month, over September 26-27, I attended a US government workshop on The Use of Blockchain in Healthcare and Research, organised by the Department of Health & Human Services Office of the National Coordinator (ONC) and hosted at NIST headquarters at Gaithersburg, Maryland. The workshop showcased a number of winning entries from ONC's Blockchain Challenge, and brought together a number of experts and practitioners from NIST and the Department of Homeland Security.

I presented an invited paper "Blockchain's Challenges in Real Life" (PDF) alongside other new research by Mance Harmon from Ping Identity, and Drummond Reed from Respect Network. All the workshop presentations, the Blockchain Challenge winners' papers and a number of the unsuccessful submissions are available on the ONC website. You will find contributions from major computer companies and consultancies, leading medical schools and universities, and a number of unaffiliated researchers.

I also sat on a panel session about identity innovation, joining entrepreneurs from Digital Bazaar, Factom, Respect Network, and XCELERATE, all of which are conducting R&D projects funded by the DHS Science and Technology division.

Around the same time as the workshop, I happened to finalise two new Constellation Research papers, on security and R&D practices for blockchain technologies. And that was timely, because I am afraid that once again, I have immersed myself in some of the most current blockchain thinking, only to find that key pieces of the puzzle are still missing.

Disclosure: I traveled to the Blockchain in Healthcare workshop as a guest of ONC, which paid for my transport and accommodation.

Three observations from the Workshop

There were two things I just did not get as I read the winning Blockchain Challenge papers and listened to the presentations. And I observe that there is one crucial element that most of the proposals are missing. 

Limits to what Blockchain actually does

Firstly, one of the most common themes across all of the papers was interoperability. A great challenge in e-health is indeed interoperability. Disparate health systems speak different languages, using different codes for the same medical procedures. Adoption of new standard terminologies and messaging standards, like HL-7 and ICD, is infamously slow, often taking a decade or longer. Large clinical systems are notoriously complex to implement, so along the way they invariably undergo major customisation, which makes each installation peculiar to its setting, and resistant to interfacing with other systems.

In the USA, Health Information Exchanges (HIEs) have been a common response to these problems, the idea being that an intermediary switching system can broker understanding between local e-health programs. But as anyone in the industry knows, HIEs have been easier said than done, to say the least.

According to many of the ONC challenge papers, blockchain is supposed to bring a breakthrough, yet no one has explained how a ledger will make the semantics of all these e-health silos suddenly compatible. Blockchain is a very specific protocol that addresses the order of entries in a distributed ledger, to prevent Double Spend without an administrator. Nothing about blockchain's fundamentals relates to the contents of messages, healthcare semantics, medical codes and so on. It just doesn't "do" interoperability! The complexity in healthcare is intrinsic to the subject matter; it cannot be willed away with any new storage technology.

Blockchain won't fundamentally change Personal Data practices

The second thing I just didn't get about the workshop was the idea that blockchain will fix healthcare information silos. Several speakers stressed the problem that data is fragmented, concentrated in local repositories, and hard to find when needed. All true, but I don't see what blockchain can do about this. A consensus was reached at the workshop that personal information and Protected Health Information (PHI) should not be stored on the blockchainin any significant amounts (not just because of its sensitivity but also the sheer volume of electronic health records and images in particular). So if we're agreed that the blockchain could only hold pointers to health data, what difference can it make to the current complex of record systems?

Accenture Blockchain for Healthcare CURRENT STATE  Accenture Blockchain for Healthcare TARGET STATE

Blockchain's missing link: Key management

And my third problem at the workshop was the stark omission of key management. This is the central administrative challenge in any security system, of getting the right cryptographic keys and credentials into the right hands, so all parties can be sure who they are dealing with. The thing about blockchain is that it did away with key management. The genius of the original Bitcoin blockchain is it allows people to exchange guaranteed value without needing to know anything about each other. Blockchain actually dispenses with key management and it may be unique in the history of security for doing so (see also Blockchain has no meaning). But when we do need to know who's who in a health system – to be certain when various users really are authorised medicos, researchers, insurers or patients – then key management must return to the mix. And then things get complicated, much more complicated than the utopian setting of Bitcoin.

Moreover, healthcare is hierarchical. Inherent to the system are management structures, authorizations, credentialing bodies, quality assurance and audits – all the things that blockchain's creator Satoshi Nakamoto expressly tried to get rid of. As I explained in my workshop speech, if a blockchain deployment still has to involve third parties, then the benefits of the algorithm are lost. So said Nakamoto him/herself!

Steve Wilson Blockchain and Healthcare NIST ONC 26Sep16 (0 6)  THird Party

In my view, most blockchain for healthcare projects will discover, sooner or later, that once the necessary key management arrangements are taken care of, their choice of distributed ledger technology is inconsequential.

New Constellation Research on Blockchain Technologies

How to Secure Blockchain Technologies

Security for blockchains and Distributed Ledger Technologies (DLTs) have evolved quickly. As soon as interest in blockchain grew past crypto-currency into mainstream business applications, it became apparent that the core ledger would need to augmented with permissions for access control, and encryption for confidentiality. But what few people appreciate is that these measures conflict with the rationale of the original blockchain algorithm, which was expressly meant to dispel administration layers. The first of my new papers looks at these tensions, what they mean for public and private blockchain systems, paints a picture for third generation DLTs.

How to Conduct Effective Blockchain R&D

The uncomfortable marriage of ad hoc security and the early blockchain is indicative of a broader problem I've written about many times: too much blockchain "innovation" is proceeding with insufficient rigor. Which brings us to the second of my new papers. In the rush to apply blockchain to broader payments and real world assets, few entrepreneurs have been clear and precise about the problems they think they’re solving. If the R&D is not properly grounded, then the resulting solutions will be weak and will ultimately fail in the market. It must be appreciated that the original blockchain was only a prototype. Great care needs to be taken to learn from it and more rigorously adapt fast-evolving DLTs to enterprise needs.

New Constellation ShortListTM for Distributed Ledger Technologies Labs

Finally, Constellation Research has launched a new product, the Constellation ShortListTM. These are punchy lists by our analysts of leading technologies in dozens of different categories, which will each be refreshed on a short cycle. The objective is to help buyers of technology when choosing offerings in new areas.

My Constellation ShortListTM for blockchain-related solution providers is now available here.

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