Personal Log: Have most analysts completely given up doing research?

R "Ray" Wang

Principal Analyst and Founder
Constellation Research

R “Ray” Wang is the CEO of Silicon Valley-based Constellation Research Inc. He co-hosts DisrupTV, a weekly enterprise tech and leadership webcast that averages 50,000 views per episode and blogs at www.raywang.org. His ground-breaking best-selling book on digital transformation, Disrupting Digital Business, was published by Harvard Business Review Press in 2015. Ray's new book about Digital Giants and the future of business, titled, Everybody Wants to Rule The World was released in July 2021. Wang is well-quoted and frequently interviewed by media outlets such as the Wall Street Journal, Fox Business, CNBC, Yahoo Finance, Cheddar, and Bloomberg. Short Bio R “Ray” Wang (pronounced WAHNG) is the Founder, Chairman, and Principal Analyst of Silicon Valley-based Constellation…...

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Authors: Phil Fersht and R “Ray” Wang, Industry Analysts who still give a sh!t

(This is a collaboration and represents our individual points of view and not necessarily our employers. Oh wait, that’s us…. moving on…)

The State Of The Industry Research Industry Remains Fragile

We called it three years’ ago and we can now officially proclaim that the industry, once known as research, is close to meeting its maker.

Okay, the reality is it’s rare these days for analysts to comb for obscure facts, ask the hard questions, reach out to customers, dig deep with the system integrators, and circumvent corporate communication teams by going direct to employees for the inside scoop.

In fact, the alarming observation of analysts, especially in the large firms, is that most of them are spending all their time on evaluation matrices (e.g. MQs, Waves, Marketscapes, etc.).  There seems to be precious little (or any) research coming out of these places anymore.  Where are the big ideas? Where’s the insight? Where’s the thought leadership? What do these people stand for anymore?

When we sat down to talk to our client base, our analysts, and our clients, we determined that there were eight common reasons, namely:

1. Legacy business models are built on scare to play.  The only way the legacy firms are making money is through selling reprints of vendor positionings. Sales folks tell vendors that if they don’t pay for briefing hours and advisory time, analysts will ignore them.
2. Tele-analyst approach reinforces an ivory tower image.  Today’s legacy analysts have no other means of getting data.  Sadly, most rarely ever talk to buyers of services  or users of technology.  The situation is so bad, that many vendors are forced to provide 15 to 50 customer references because the analyst has no means to reach out to real customers.
3. Stone soup research model reflects the laziness of analyst firm methodologies.  They are essentially having the vendors do their “research” for them.  Another way to look at this, legacy analyst firms are strong-arming vendors into providing references as their primary method of reaching out to customers.  Some analysts today are demanding three hour briefings with vendors to educate them – they are essentially making vendors pay to give them the knowledge they need to appear smart.
4. Egotistical narcissism drives power trips in evalutions.  Legacy analysts love the attention of vendors pandering to their demands.  In one case, a legacy analyst asked for 35 client references for a scatterplot chart.  Vendors humored him just to play along.
5. Information often confused as insight.  Many legacy analysts have precious little fresh insight of their own.  Often legacy analysts operate on limited data and base “facts” from old surveys run at the corporate level.  The result – dated insight not grounded with the reality of the buyer’s point of view. In fact, many have become so  enslaved to the vendor evaluation model and have forgotten that they really are an analyst who’s supposed to provide insight to the world – not simply regurgitate vendor-fed marketing hype.
6. Limited practical experience hampered by siloed’ coverage areas.  The legacy analysts firms create specialists blinded by the big picture and intensely focused on the hyper specific. Clients often express frustration in having to schedule conversations with multiple analysts who often can not match experience with context.
7. Lowered expectations reinforce lowered standards.  Let’s face it, the legacy analyst firms have lost touch with their clients when it comes to research. Clients aren’t expecting insight anymore, and most the analysts just aren’t producing it.
8. Failure of research firms to bring in visionary leaders.  Most of the traditional analyst firms prefer to have 20 year veterans as their lead visionaries to the market, many of whom have never worked in the real world and refrain from hiring dynamic analysts who can outshine them.  Many refrain from talking to clients, speaking at conferences as they have lost touch with their customers – and are not incentivized to inspire – simply keep their machine cranking along. They have become slaves to their internal politics and P&Ls, as opposed to shaping new ideas and insights to delight their markets.

The Digital Chasm Among Analyst Firms Is Growing

Buyers must seriously ask if legacy analyst firms are still analyst firms or are they merely advertising agencies for vendors smart enough to play their game?  With the dearth of enterprise journalists and media, has the analyst become the new media for the enterprise market?

Gartner’s model is smart. It continues to create more categories to include more vendors with the goal of monopolizing a vendor’s resources and time.  Many vendors now have multiple FTE’s dedicated to just Gartner’s evaluations.  This model crowds out other independent voices and puts pressure on the other legacy analyst firms.  Those dedicated to the analyst relations function have little time to see a different point of view.

We believe that should this continue, there may not be a research industry left in 2 years’ time.  We believe that this model of racking and stacking vendors will no longer be sustainable.

The Bottom line: The only way to resurrect research is to bring back talent – and motivate it

We can talk about new business models for hours, but the one missing ingredient in today’s fading research business is the lack of passionate people who want to know everything about their area, who are talking to the people who buy and sell technology and services… who care about what they represent and articulating what they think and do.

Where are those people?  Are they hiding, did they retire, or did they just give up?  Or did they just figure out how to check the boxes as analysts and give up caring about their careers?

Without passionate talent, we’re doomed and research can – and will soon – be put to bed as a distant memory that once was.  Maybe a couple of smart individuals will save this industry, but it needs some serious saving…

Your POV.

Tired of the white paper for hire analysts?  Not getting value from your legacy analyst firm?  Come join Constellation Research for a different experience.  Thanks in advance for your feedback. Add your comments to the blog or reach me via email: R (at) ConstellationR (dot) com or R (at) SoftwareInsider (dot) org.

The post Personal Log: Have most analysts completely given up doing research? appeared first on A Software Insider's Point of View.

Sales Navigator – LinkedIn’s New Way to Operationalize Social Selling

Vice President and Principal Analyst, Constellation Research
Constellation Research

Role: Vice President and Principal Analyst focusing on the IOT of Customer Experience and how the cloud is driving more flexible, agile, and robust customer service and customer experiences. In-app or in device customer service is the future. Coverage Areas: Next Generation Customer, Digital Marketing Transformation Bio: As a Vice President and Principal Analyst at Constellation Research, Inc, Petouhoff works with Fortune 100 and 500’s Senior Leadership teams to create strategic customer experience (marketing, sales and service) solutions which engage customers, build brands and grow businesses. Combining her experience as a former Forrester software analyst, PWC systems integrator and change management consultant, Petouhoff leads executive workshops to discuss to not only…...

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I was just at Sales Connect Conference, LinkedIn’s Social Selling Conference. I was there to meet and great many of the top minds in social selling and to do research for an upcoming report. What I found was that one of the best things about being at the conference (besides the technology) was to be in a room full of people who are all thinking the same thing. It’s time to change how company’s operate. It’s time to change how people get treated at work. It’s time to change how sales people are perceived. It’s just plain time to change.

I liked the idea of a Social Selling Index (SSI) and that through that one could tell where they stand with respect to using new tools like Sales Navigator and to know what we need to change. The biggest take-a-way I got from the conference was that sales is less about the product or service you are offering, and more about the relationship you are building with the customer or person you are selling to. That seems so simple that it is feels kinda silly writing it. But having been in sales positions before and knowing that the sales was more about getting the quota for that quarter than it was about how I was going to build a relationship with someone over the long haul and be able to look them in the eye 20 years from now. After thinking about it like that it doesn’t seem silly writing it.

Sales and the profession of sales has changed. It is about the relationship. And this is not new. It used to be that way when we were oriented toward mom and pop shops, where everyone in the village knew each other and did have to look each other in the eye over 20 or 30 years. With industrialization and expansion, we lost that sense of personal responsibility to those we sell to and now it’s back. And I’m glad because I feel better about the way the world is starting to go. I feel better about the level of integrity that digital / social and SaaS is bringing to sales. I’m glad that people are accountable and that we now can see a future where we are honest with ourselves and our customers.

How are you feeling about sale these days? Do you think social / digital / SaaS has changed anything?

If you missed the conference, here’s my storify report… that has all the tweets from the hashtag #SalesConnect https://storify.com/drnatalie/how-linkedin-is-changing-sales

@drnatalie

VP and Principle Analyst covering Marketing, Sales, Customer Service to bring about Amazing Customer Experiences and Long Lasting Relationships in Business

Who Should Be the Digital Disruptors? Marketing, Sales, Customer Service or CEOs?

Vice President and Principal Analyst, Constellation Research
Constellation Research

Role: Vice President and Principal Analyst focusing on the IOT of Customer Experience and how the cloud is driving more flexible, agile, and robust customer service and customer experiences. In-app or in device customer service is the future. Coverage Areas: Next Generation Customer, Digital Marketing Transformation Bio: As a Vice President and Principal Analyst at Constellation Research, Inc, Petouhoff works with Fortune 100 and 500’s Senior Leadership teams to create strategic customer experience (marketing, sales and service) solutions which engage customers, build brands and grow businesses. Combining her experience as a former Forrester software analyst, PWC systems integrator and change management consultant, Petouhoff leads executive workshops to discuss to not only…...

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In thinking about the value of the information companies can obtain about their customers, their products and services, etc… from structured and unstructured data, who do you think should lead this effort in an organization? Each department – Marketing, Sales, Customer Service / Contact Center professionals can all do their part, but often are not high enough in the organization to drive widespread change that is required to get the results from digital disruption. I had a really great conversation with some of the best thinkers in the world at IBM who are working on Watson and it got me to thinking more about the issue of getting companies started down this path and who really should lead it. I’d love to hear your thoughts.

Do you think CEO’s or CFO’s or COO’s really understand the value that can be obtained by this data? Do they see the opportunity to use it to become a company that lives in an ecosystem where their are no other competitors, i.e., the competition is irrelevant?

Some of the best ways to take advantage of the digital disruption is to:

1. Change your business model to include using the structured and unstructured data to make better products and services and deliver better customer experiences and make a better workplace

2. Change how your functional departments work together using the structured and unstructured data so that the customer experience is not disconnected and actually becomes enjoyable and drives advocacy, loyalty and referrals — and long-term customer lifetime value

3. And in the end the data will change your business model and how your functional departments collaborate and your products and services will be get better from all this structured and unstructured data if it is turned into actionable insights so that you can create a blue ocean strategy where your company is in an uncontested marketplace where the competition is irrelevant.

But for that to happen, it has to be driven by folks who are not too low in the totem pole, but rather by those who have the positional power to really drive this digital disruption change.  And I believe, unless and until the CEO, CFO and COO change the metrics the functional departments get measured on, people will keep doing what they are doing.

Yes, there are some companies where marketing, sales and service work together; but those are the innovators and early adopters. The majority of the marketplace is the early majority and they are thinking about things the way they have always been thinking about things…

Who is going to be the instigators in this new digital disruption? Come join us at our Connected Enterprise Conference to hear how other leaders are dealing with the questions.

@drnatalie
VP and Principle Analyst, Covering Marketing, Sales and Customer Service to Drive Brilliant and Lastly Customer Experiences.

Case Study: Ringling College Embraces Lifecycle Marketing

Partner, Sensei Marketing
Partner, Sensei Marketing

Sales & marketing veteran with almost 30 years’ experience and now 1800 digital projects to his credit for clients including Morgan Stanley, AOL, Hyatt Gaming Management, Snyder's of Hanover, Hitachi, the Home Depot, Kraft Foods, Drees Homes, American Idol, and hundreds more, including leading agencies around the North America.     ...

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Ringling College of Art and Design, the premier art college located in Sarasota Florida, had the same goal that every higher education institution has: to increase admissions. However, while every college may have the same admissions goal, each faces a unique set of challenges in trying to achieve that goal.

Ringling College is a private, not-for-profit, fully accredited college offering Bachelor’s degree programs in 11 majors, including Illustration, Computer Animation, Game Art, Motion Design, Fine Arts, Digital Filmmaking, Graphic Design, and Advertising Design. The college has received numerous distinctions, including being named among the top 25 U.S. film schools by The Hollywood Reporter, which has elevated its position among art colleges globally. Alumni have also been awarded many honors including Emmy® and Academy Award® wins.

The Challenge: Corporate Distrust, Peer-to-Peer Influence

However, as with other private art colleges, the admissions department is faced with studies and reports that suggest an art degree is less likely to pay career dividends, despite the proven success of Ringling College’s alumni. Further, as a private college, the average tuition is higher than that of many community colleges,  which is  serious obstacle to the admission team’s efforts coming out of a period of economic depression.

Rich Kaplan, Ringling College’s VP of Marketing and Innovative Partnerships, understood these challenges and realized that a different strategy than that embraced by most colleges was required. He tasked Sensei Marketing to design and develop an innovative solution that would increase brand awareness as well as show measurable improvements in new student acquisition.

Sensei analyzed the realities faced by post-secondary institutions: Intense competition; limited marketing budgets; and a highly-connected social audience that put more faith in peer commentary (even if anecdotal) than in facts and proof points advertised by colleges. Further, due to limited resources, most colleges take a very myopic approach to lead generation. Admissions often focus on high school students who are within 12 months of choosing a college; alumni are most often targeted for financial support, and rarely are those efforts connected or consistent from end to end.

The Solution: Life Cycle Marketing

A long-term engagement strategy was developed for Ringling College that would guide the institution toward fostering a continuing relationship with artists from the age of 14 to 100.  Specifically, the strategy would see the college facilitate relationship building among peers, mentors, and influencers, which will continue from the first year of high school to their adult lives.

Sensei mapped the “customer journey” that a typical art student would pass through during their teen and adult lives, and cross-referenced that with life events, situational factors, and relationships that might affect students’ decisions to attend art colleges.

The first phase of the strategy was launched last week, which included a new website targeting students in the college decision-making stage. The website, www.whyringling.com, and the associated social media campaigns utilizing the #WhyRingling hashtag, provide the peer-to-peer social proof that high school students have indicated they turn to when making college choices. The site was built using Responsive Web Design (RWD) because research indicated that the mobile devices were the primary tool used by the target audience for researching and discussing college-related information.

Further, the website’s content, which is managed by a content management solution so that content may be refreshed many times per week, is driven by the student and alumni’s voices, not the typical “corporate speak” created by higher education institutions.  The site features profiles of current students and alumni sharing their views about why they chose Ringling and what it has meant to their careers. In addition, the site highlights the benefits of living in Sarasota, the on-campus culture and support system, the art work developed by students and alumni, and the many awards the college’s students are winning.  The interactive,  Tumblr-style home page was designed in direct response to the research results that indicated the audience’s preference for a more visual graphical user interface than traditional website structures.

In addition, a dedicated online art community, powered by social media platform TicTalking, was also launched to facilitate peer-to-peer conversations focused around art, design, advertising, and creative culture. The community, which is open to anyone interested in these subjects, will be focused on fostering peer-to-peer relationships and not direct promotion of the college.

The primary goals of the initial social outreach program include fostering an interest in art and design, nurturing relationships, educating the community on the benefits of an art degree, and promoting profitable and fulfilling art-related careers.  Stay tuned to this blog in the future for details on the release of future phases and results from this first phase.

Demand For 3D Printing Skills Is Accelerating Globally

35% of all ads posted for engineering jobs in the last 30 days prioritize 3D printing and additive manufacturing as the most sought-after skill.

Wanted Analytics’ latest analysis of the 3D printing and additive manufacturing job market found that IT and management expertise were the second most common skill sets mentioned in ads seeking to recruit engineers.  Key take-aways from their study and the growing market for engineers with 3D printing skills are provided below:

Key Take-Aways

• The number of job ads requiring workers with 3D printing skills increased 1,834% in 4 years and 103% when comparing August 2014 to August 2013.  The following graphic illustrates the accelerating growth of 3D printing and additive manufacturing expertise needs of employers over the last four years.

• Wanted Analytics found that the most in-demand jobs requiring 3D printing and additive manufacturing expertise include the following:
  • Industrial Engineers
  • Mechanical Engineers
  • Software Developers, Applications
  • Commercial and Industrial Designers
  • Marketing Managers – High demand for marketing and selling expertise as manufacturers, software and service providers look to launch new business models that capitalize on 3D printing’s many business advantages.

• Manufacturing has the highest number of positions for 3D printing and additive manufacturing skills, with the following industries generating the majority of the jobs in this field today:
  • Other Computer Peripheral Equipment Manufacturing
  • Colleges, Universities, and Professional Schools
  • Tire and Tube Merchant Wholesalers
  • Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
  • Aluminum Sheet, Plate, and Foil Manufacturing

• Demand for freelance 3D printing and additive manufacturing expertise is flourishing globally.  Elance has an impressive 76,979 portfolio samples used by freelancers to promote their 3D printing, 3D modeling and additive manufacturing expertise.  There are 2,444 freelancers actively looking for 3D printing, 3D modeling and additive manufacturing projects, and 88 projects currently open.
• Freelance exchange ODesk currently has 2,395 freelancers listed as 3D printing specialists and designers and 78 projects currently open.
• Guru.com lists 367 freelancers with 3D printing expertise available and 180 open projects.
• CAD Crowd has 3,760 3D printing freelance experts and provides a global map of their locations, which is shown below.

• Job boards entirely dedicated to 3D printing are being launched this year and growing fast.  One of the fastest growing is 3D-Printing-Jobs.com, which just launched last May and already has dozens of open positions listed.  Another is 3DPrintingIndustry.com’s job portal which can be found here at the 3D Printing Industry Jobs Page. The 3D Printing Job Board includes open positions worldwide and has many located in the United Kingdom, India, Canada and the United States. MediaBistro has 89 positions listed on their job board as of today for engineering, marketing, customer service and technical professionals with 3D printing expertise. The MediaBistro 3D Printing job board can be found here.  

• Indeed.com has 474 job positions open today that require 3D printing, nine of which pay over $130,000 per year.  You can find the listings of open positioning on Indeed.com requiring 3D printing expertise here.

Must-See Sessions at Social Media Week, Sydney

Gavin Heaton

Founder
Disruptors Co

Gavin is the Founder of Disruptors Co, one of Australia’s leading independent strategy and innovation companies. Gavin advises firms on strategy, marketing, product development and innovation. He is also a member of the Orbits program, the influencer network of  award winning analyst and advisory firm, Constellation Research. Gavin advises boards and leadership on innovation strategy, marketing, data-driven product development and corporate venturing. Gavin is on the board of Vibewire, a youth-led social enterprise based in Sydney, Australia and on the Technology Advisory Group for Good2Give – the workplace giving platform. ...

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Social Media Week, Sydney is just around the corner. It is the first time that the event has been run in Australia but the organising team, Simon Micarone, David Wesson and Will Ockenden have high hopes for it becoming a regular feature on the Australian conference landscape.

Running all week, from 22 September through to 26 September, there are a great range of sessions, keynotes and master classes to participate in. But if you are like me, you may need to ration yourself in an effort to learn but also continue delivering for clients. With this in mind, I have selected some of the must-see sessions and master classes that will impact not just the way that you think, but the way you carry on the business of social media.

Monday, 22 September:

• Opening keynote (Gavin Heaton). Yes, it’s me, kickstarting the week’s activities and reminding us all just how far we’ve come and how much further there is to go.
• The Australian Landscape (AIMIA). Get the lay of the land with a fab panel that outlines opportunities for growth and innovation.
• Online Community Management (Alison Michalk). Get serious about community management with one of the best in the country.

Tuesday, 23 September:

• Keynote – Earned Traffic and Authority (Jeff Bullas). No doubt you’ve read his blog, now here’s the chance to see him in the flesh. Sit up the front with me and be inspired.
• Social ROI (Joanne Jacobs). Always a hot topic, there’ll be plenty to take back to the office straight from the brain of Joanne Jacobs.
• Keynote – the Connected Brand (Trevor Young). The charming and ultra-smart PR Warrior will cut through the noise.
• Social data = Big Data + Profits + Purpose (Panel). I’m hosting this panel that discusses the power of social, data and profits are unleashed when you add a sense of purpose. Not to be missed
• Influencers and Online Advocacy (Panel). I’m really looking forward to this. Influence is a hot topic and these folks know what they are on about.

Wednesday, 24 September:

• Keynote – What Do Aussies Care About (Simon Crerar). Buzzfeed are so hot right now. Hear from Simon on just what tickles our fancy and why.
• Creating a Movement for Social Good (Panel). What a rockstar line up. This is not just about social good – it’s about moving people to act. And that’s what we all need help with.
• Future of Publishing (panel). Another awesome panel bringing together some of the movers and shakers in the social publishing space. Monolithic media is dead baby.

Thursday, 25 September:

• The Power of Twitter for Small Business (Suzy Nicoletti). Get the lowdown from the folks who should know. Great master class from Twitter’s head of mid-market sales.
• Has Social Changed TV Forever (Panel). One of my personal favourite topics. How do we reimagine engagement when there’s way more than one screen on at a time?
• Consumer Wearables, Where to Next? (Panel). This is the next contestable ground for consumer engagement. We’re only just scratching the surface at the moment.

Friday, 26 September:

• Keynote – Under the Digital Bridge (Venessa Paech). This will be awesome – especially for those of us who deal with trolls, ranters, ravers and other monsters in our audiences.
• Living in the Culture of Participation (Panel). Want to know what it takes to make effective change? This panel will blow your mind. You have been warned.
• Stay for the day. Ok – you may as well block out the whole day. There are some awesome sessions that you’ll want to immerse yourself in. And anyway, it’s Friday.

10 Things We Want to Know About IoT - webinar recording

Today Constellation hosted the webinar, 10 Things We Want to Know About IoT. Please find the webinar recording and additional digital IoT resources below. 

Despite the overabundance of 'experts' in IoT, many questions about IoT remain unanswered. R “Ray” Wang and Richie Etwaru address the critical questions that should be asked about IoT.

1. How mature does IoT technology need to be before it begins to significantly impact consumers and business models?
2. What impact will IoT have on consumers and business models?
3. What types of connections between 'things' will be meaningful?
4. What should we/will we do with all the data collected by these 'things'?
5. How should businesses prepare?
6. At what level of maturity is IoT technology?

and many more!

Resources:

A Framework to Humanize the Internet of Things Through Verbs by Richie Etwaru

Unanswered Questions About the Internet of Things by Richie Etwaru

Weekly Recap - September 19th 2014

Holger Mueller

Vice President and Principal Analyst
Constellation Research

Holger Mueller is VP and Principal Analyst for Constellation Research for the fundamental enablers of the cloud, IaaS, PaaS and next generation Applications, with forays up the tech stack into BigData and Analytics, HR Tech, and sometimes SaaS. Holger provides strategy and counsel to key clients, including Chief Information Officers, Chief Technology Officers, Chief Product Officers, Chief HR Officers, investment analysts, venture capitalists, sell-side firms, and technology buyers.  Coverage Areas: Future of Work Tech Optimization & Innovation  Background: Before joining Constellation Research, Mueller was VP of Products for NorthgateArinso, a KKR company. There, he led the transformation of products to the cloud and laid the foundation for new Business Process as a…...

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Time to try something new - tackling the highlights of the week in video - as they flew by me...

Here are the events captured in the video:

• SAP Cloud Deep Dive - my takeaways
• Infor Inforum 14 - Day 1 Top 3 Keynote Takeaways ... read here
• HANA Cloud Platform Revisited ... read here
• Market Move - Cisco buys Metascale ... read here
• Event Report - Infor Inforum 14 - Top 3 Takeaways
• HP Helion Press Call with Saar Gillai and Marten Mickos
• Progress Report - ADP shows great vision ... read here
• Market Report - SAP acquires Concur... read here
• Larry Ellison steps down as Oracle CEO - my takeaways
• Friday Briefings with X-IO (Storage), Informatica DreamForce announcements preview, HyTrust (Security), CloudFactory (BPO) and Realm.io (Mobile DB)
• Preview on next week - Workday Tech Summit and Wipro Analyst Day

Progress Report - ADP shows great vision, delivers product innovation, now it needs to deliver adoption

Holger Mueller

Vice President and Principal Analyst
Constellation Research

Holger Mueller is VP and Principal Analyst for Constellation Research for the fundamental enablers of the cloud, IaaS, PaaS and next generation Applications, with forays up the tech stack into BigData and Analytics, HR Tech, and sometimes SaaS. Holger provides strategy and counsel to key clients, including Chief Information Officers, Chief Technology Officers, Chief Product Officers, Chief HR Officers, investment analysts, venture capitalists, sell-side firms, and technology buyers.  Coverage Areas: Future of Work Tech Optimization & Innovation  Background: Before joining Constellation Research, Mueller was VP of Products for NorthgateArinso, a KKR company. There, he led the transformation of products to the cloud and laid the foundation for new Business Process as a…...

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We were invited to ADP’s yearly analyst summit in their brand new Innovation Lab in the Chelsea neighborhood of New York. What was an empty floor plan back during my first visit in April this year – with only the blueprints giving an impression of what it would be, the space has turned into an impressive working facility with a mix of open space floor plan, huddle spaces and of course cafeteria and snack area. Unfortunately ADP sent the developers home for the day – would have been great to see the center in action, maybe something to consider for next year.

Over 20 analysts received a comprehensive briefing starting with CEO Carlos Rordriquez all the way to an update on ADP’s Research activity. ADP was smart to have a customer speak to us, too – giving a welcome change to vendor speakers but also a great validation point. 

Tough to pick the Top 3 takeaways – but here we go:

• ADP has delivered – When I first saw the demos and mockups of ADP’s new interface and product architecture at the Meeting of the Minds (MOTM) conference this spring in Orlando, my (conservative) bet was 50 / 50 that ADP would deliver in September as promised. It’s simply too easy to show nice demos and mockups and then often too hard to build them in real software. I raised my confidence a few weeks later when visiting the Innovation Lab and talking more in detail with Roberto Masiero and Keith Fulton and their teams. Talking to some of the new hires and seeing talent and background my odds went up to maybe 80%. Often even very talented people don’t make dates. But after today’s briefings it’s clear that ADP has delivered to the vision and ideas of MOTM (what I called a front end renovation strategy back then) and delivered its new user interface, delivering new user experience with the interactive paycheck, and Benefits Enrollment this September. Both are only a start – but have good seasonal arguments for them – HR Tech is coming and Enrollment is starting for most enterprises. And naturally paycheck related innovation reaches most eyeballs in the ADP user community.
  
  What I missed back then – or wasn’t briefed on – I tend to belief the latter of course – is that the team took a platform approach to deliver the new applications. And already in April ADP published the platform to the community at developers.adp.com. This gave ADP more eyeballs and more validation, something always helpful for new platforms. On top of that platform ADP created a declarative Visual Design Language (VDL) to build systems – a good move to ensure consistency across products and developers. If all works ADP should pick up significant speed in the next quarters and deliver a very large number of new UIs for many / most of their products in 2015.  

CEO Rodriguez opens the analyst meeting

• ADP doesn’t stop here – Beyond the new user interface, ADP plans to deliver innovations in Social HCM (mostly around Performance Management), very interesting Benchmarking capabilities (both in pilot today and coming 2015, my guess it at MOTM), Data Mashups of HCM and non HCM data for true performance insights (summer 2015) and predictive analytics capabilities (later in 2015).
  
  But even before all of the above, ADP will make available its Marketplace (again my guess is for HR Tech) – that will open up for partners and customers. We have seen a number of marketplaces being more quietly (SuccessFactors) or loudly (Cornerstone) launched – so this seems to become a trend. And it makes sense to lower integration and purchasing costs for customers, but at the same time increases the stakes of the game not only from a platform perspective, but also a commercial perspective (invoicing, payment are just a few examples). 

 

The ADP Lab is in good company as Masiero shows

• New Innovation keeps coming – As if the above wasn’t enough, ADP is also actively working on their next generation architecture. It has many very compelling and modern design characteristics like a global object model that will be kept in memory, using columnar database technology, fully declarative execution and forming a backend to the existing VDL UI. We need to learn more on that asap, but definitively one of the more innovative HCM architectures out there. And the ADP team seems to be already on the way – sharing size of the object model graph and access times (no surprise, superfast) with the analyst community. And with an open source first approach the ADP team has been able to build the next generation platform at impressive speeds. It was too early – or ADP didn’t want to share yet – what the first use cases will be, but definitively an area on which we will keep a key eye on. 

 

Deliverables and design principles of the new ADP UI

Tidbits

• DaaS Opportunity ahead – It was good to catch up with Ahu Yildirmaz, the Head of the ADP Research Institute that prepares the monthly ADP National Employment Report, which turns out to be remarkably accurate. ADB is building on this capability with the launch of a new workfroce index next month, designed to provide a clearrer picure of the vitality of the U.S. workfroce and emerging trends. nd with ADP paying 1 out of 6 paychecks in the USA there is enough data to be more than ready for some benchmarking and further data related activities and services. Good to see some of those on the roadmap for 2015.
   
• Global View makes progress – It was good to catch up on GlobalView with Stuart Sackman and David McIninch. The product makes progress and has interest of prospects, but is challenged with the innovation happening both in house and at long term partner SAP. Innovation is great but you need terra firma for global rollouts. And ADP partners with SuccessFactors and Workday, with the sound directive that the customer should always win. Certainly a good bearing but it will be good to see more of an ADP product / IP strategy for GlobalView, too, creating more differentiators over pure services competition in BPO.
   
• Focus on global compliance - ADP is building on their global footpring and deep knowledge to position themselves as the leader in Global HCM compliance. For examle ADP supports the statutory rules and policies for Social Benefit managament in China, where work rules vary by city.
   
• Analytics – but really dashboards – ADP is creating a promising dashboard product, that makes suggestions to guide the path of analysis, as demoed by Richard Wilson and Vikas Saini, it is tackling key performance questions and includes non HCM data – what most users want to see. It would be good to have the product making recommendations in even stronger voice, but a good start (see my take on ‘true’ analytics here).
   
• Recruiting – shows the need for a new UI – Next we looked at Talent Management, and as briefed together with Bill Kutik and Steve Boese, not surprisingly a lot of Recruiting. The functionality is solid and good – but the user experience is a few years old. So it’s timely the new VDL powered UI is around the corner. I’d expect ADP to show mockups shortly. And then there is the alternative view, making the recruiter obsolete (read here) which isn’t reflected. I also think ADP needs ‘guerilla’ / viral ways to get Talent Management functionality into its customer base, as perception, access to decision makers and sales skills take a long time to develop.
   
• A blossoming Innovation Lab – Next we met with Roberto Masiero and Keith Fulton, the two drivers behind the Innovation Lab. If ADP customer like the new products, these are the gentlemen to send the fruit baskets to (they will share them with their teams). I was impressed that they found time and energy – despite the remarkable 9 month only ingestion time for the Innovation Lab and new user interface – to come up with the next generation architecture. Being able to disrupt yourself while disrupting ADP is remarkable.
   

• Compelling UIs are coming – Last but not least a sneak previews on the Talent Management UIs with Anna Carsen. They all look clean, easy to use and well thought through. And it should not be a surprise, as the team does robust usability and focus group testing. Good to see the progress. 

MyPOV

At Constellation we always have the customer in mind, and it looks like ADP is coming around and offering its customers (and prospects) a really compelling product vision and roadmap with early proof points coming this year. It makes sense for SAP to start with Paycheck and Enrollment related products, and most of the innovations will hit the masse of products in 2015 – which is going to be soon. Coupled with innovations around social, BigData and Analytics the future for ADP customers looks bright from a product direction.

But getting there is hard and while ADP is migrating a lot of customers, adoption of new products being the area of attention. And it’s one thing to build a great (the current approach) product or a solid product (Vantage) and then get it adopted. The slow adoption of the ADP Talent Management products may serve a warning. So ADP needs to get adoption of these new products right in its huge install base.

Last but not least we heard before the event that ADP veteran Michael Capone is leaving the company, to pursue a long term calling in the healthcare (software) industry. The team under Capone is very strong and this analyst day certainly showed that – but there is realistically a (small) cloud on the ADP horizon. It’s now to Rodriguez to find the right leader of the product organization that is currently in flight – not a walk in the park, but with a strong team certainly doable. We will be watching closely.

More on ADP

 

• Site Visit - ADP's new innovation lab in Chelsea - read here
• News Analysis - ADP announces Spin-Off plans for Dealer Services, sharpens ADP's focus on HCM - read here.
• Event Report - ADP's Meeting of the Minds - ADP has made up its mind (almost) - customers not yet - read here.
• First take - 3 Key Takeaways from ADP's Meeting of the Minds Conference Day 1 Keynote - read here.
• ADP innovates with with verve and good timing – read here.

 

And  more on the importance of the paycheck for HCM:

 

• Could the paycheck re-invent HCM – yes it can – read here.
• And suddenly, payroll matters again! Read here.