Vendor Event: Why Does Everyone Need Analytics?

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 Research Inc. He…...

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Wednesday, April 25, 2012
10:00 am Pacific
1:00 pm Eastern

Presenters
Ray Wang
Principal Analyst and Chief Executive Officer
Constellation Research, Inc.

Patrick Morrissey
Vice President
Tidemark

Jennifer Maddox
Director of Product Marketing
Tidemark

Why the Move from Transaction to Experience Requires Better Analytics

Business leaders seek better insights for smarter decision-making. Unfortunately, today’s traditional intelligence tools were designed for two-dimensional transactional systems. As data from consumer trends such as mobile, social, cloud, big data, and video make their way into the enterprise, organizations seek new tools to discern insight from these new engagement and experiential systems.

In fact, leaders seek more than just reporting and dashboards, they expect to make real decisions. A recent Constellation Research survey identified key expectations from business analytics to include: supporting business strategy and planning; optimizing costs across the value chain; identifying hidden patterns and relationships in big data; providing context for relevant engagement; and predicting demand in networks.

The shift from transaction to engagement to experience depends on better business analytics.  Success requires that new business analytical tools support the information supply chain as data moves from a cacophony of upstream data sources to new and innovative downstream modes of consumption.

Why Does Everyone Need Analytics?  Because work—as we know it—soon won’t be as we know it.

Think real time. Connect finance and operations together with plans, forecasts, budgets, and a global view of the business so that everyone can see what they need, the way they need it.

Think mobile. Manage your business anywhere with a swipe of your finger from an iPad or mobile device by updating plans, doing real-time analysis, and collaboration.

Excel who? Think analytics for all.

Come join us for an interactive discussion and webinar! Register today!

Constellation Research Kicks Off 2012 SuperNova Awards for Innovators in Technology

Event Report: Clarabridge Customer Connections 2012 #cbc312

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 Research Inc. He…...

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Clarabridge “Turns Up The Heat” On Delivering Context For Customer Experience

CEO, Sid Banderjee, opened up Clarabridge‘s 4th annual user conference to 350 customers at the Doral Golf & Spa in Miami, FL on March 5th, 2012.  Clarabridge, a sentiment and text analytics software provider helps companies discern insight from their text based customer feedback and the growing plethora of social and mobile data points.  The goal – aggregation of insights from qualitative analytics that transform key organizational processes in customer experience, new product development, and employee satisfaction.

Clarabridge has shown success with a Global 1000 customer list that spans key verticals in technology/telco, retail/CPG, manufacturing, travel/hospitality, financial services/insurance.  Major clients include Bank of America, Best Buy, Cisco, Dell, Disney, Fidelity, General Mills, Hilton, IHG Hotels, Kaiser Permanente, Marriott, Siemens Sony, T-Mobile, United Airlines, Verizon, Visa, Walgreen’s, Walmart, and Zynga.

Some highlights from the event include:

• Keynote from customer experience transformist Bruce Temkin. Bruce’s keynote discussed how organizations apply Voice of the Customer (VoC) programs to augment customer experience.  Temkin highlighted his VoC Maturity assessment methodology that drills in on six key areas – detection, dissemination, diagnosis, discussion, designing, and deploying.  The key quote from Bruce was “Customer feedback is cheap, actionable insight may be valuable, but taking action on insight is precious. VoC programs are useless unless you act on what you find”
• Best practices discussions from Global 1000 companies.Leading brands such as Acer, Best Buy, B/E Aerospace, Charming Shoppes, Choice Hotels International, Inc., Dell Inc, Expedia, Estée Lauder, Fidelity Investments, GE Appliances, United Airlines, Sage, Verizon, Vodaphone, Wendy’s, Walmart, and Zynga shared best practices.   Experiences from Wynn Parrish, VP Product Support of B/E Aerospace showd how customer management and warranty liability could be minimized.  Michael Silverman at Silverman research highlighted how Unilver uses VOC for internal employee programs.  One of the highlights was Jared Anderson (Best Buy) and Jonathan Sunberg’s (Confirmit) panel on voice of the customer at the leading edge/
• Official details on the Clarabridge 5.0 launch. The launch of Clarabridge 5.0 provides the foundation for a customer insight data analytics hub (See Figure 1).  As part of the launch, Clarabridge Collaborate adds integrated notifications and alerts.  A new satisfaction scoring and sentiment transparency capability brings customer satisfaction scores into the equation to determine customer loyalty and retention programs.  Many attendees expressed interest in the new theme and event detection capabilities which provide custom categorization models to quickly surface new trends.  Last but not least, the natural language processing engine now supports Italian, Dutch, and Japanese.

Figure 1. Transforming Feedback Into Insight

Figure 2. Scenes From Clarabridge C3

Source: R Wang and Insider Associates, LLC. All rights reserved.
The Bottom Line: Voice of Customer Programs Key to Improving Customer Engagement

VOC’s provide a time honored tradition in capturing a customer’s expectations, preferences and aversions.  As the first step to any social business program, listening is critical to success.  Without understanding the customer or competitive landscape, organizations lack the insight required to address the root causes behind customer satisfaction and experience.  Customer service professionals can expect these techniques to extend beyond text based systems.  Early adopters to social business know they must build competencies in social media monitoring, text analytics, and social analytics.  In fact, organizations will see a digital divide grow in customer experience between those who use VOC techniques beyond social and those who fail to fast follow early adopters.  Why? Because customer experience is the only defensible position in today’s market.

Your POV

What strategies and tactics are you using to drive engagement?  How do you measure success.  Add your comments to the blog or send us a comment at R (at) SoftwareInsider (dot) org or R (at) ConstellationRG (dot) com

Please let us know if you need help with your Social CRM/ Social Business efforts.  Here’s how we can assist:

• Assessing social business/social CRM readiness
• Developing your social business/ social CRM  strategy
• Vendor selection
• Implementation partner selection
• Connecting with other pioneers
• Sharing best practices
• Designing a next gen apps strategy
• Providing contract negotiations and software licensing support
• Demystifying software licensing

Related Research:

• Best Practices: From First To Worst – Continental In A Post United World, Lessons In Next Gen Customer Experience
• Monday’s Musings: Seven Basic Privacy Rights Users Should Demand For Social Business
• Monday’s Musings: Balancing The Six S’s In Consumerization Of IT
• Monday’s Musings: A Working Vendor Landscape For Social Business
• Product Review: Google+, Consumerization of IT, and Crossing The Chasm For Enterprise Social Business
• Monday’s Musings: Using MDM To Build A Complete Customer View In A Social Era
• Monday’s Musings: Mastering When and How High End Brands Should Use Daily Deal Sites Such As Groupon
• Best Practices: Applying Social Business Challenges To Social Business Maturity Models
• Research Summary: Software Insider’s Top 25 Posts For 2010
• Best Practices: Five Simple Rules For Social Business
• Research Report: How The Five Pillars Of Consumer Tech Influence Enterprise Innovation
• Research Report: Next Gen B2B and B2C E-Commerce Priorities Reflect Macro Level Trends
• Tuesday’s Tip: Applying The Five Stages Of Adoption Towards SCRM Projects
• Monday’s Musings: Avoiding Failure In Social CRM Projects Requires Ecosystem Coordination
• Research Report: The 18 Use Cases of Social CRM – The New Rules of Relationship Management
• Monday’s Musings: Why Every Social CRM Initiative Needs An MDM Backbone
• Monday’s Musings: 10 Essential Elements For Social Enterprise Apps

Reprints

Reprints can be purchased through Constellation Research, Inc. To request official reprints in PDF format, please contact Sales .

Disclosure

Although we work closely with many mega software vendors, we want you to trust us. For the full disclosure policy, stay tuned for the full client list on the Constellation Research website.

* Not responsible for any factual errors or omissions.  However, happy to correct any errors upon email receipt.

Copyright © 2001 – 2012 R Wang and Insider Associates, LLC All rights reserved.
Contact the Sales team to purchase this report on a a la carte basis or join the Constellation Customer Experience!

Dolby Audio Conferencing Revisited

Alumni: Constellation Research
Constellation Research

Dr. Brent Kelly is a Vice President and Principal Analyst at Constellation Research and President of KelCor, Inc. He focuses on the unique intersection of unified communications, social business, cloud services, video and mobility.  Dr. Kelly provides strategy and counsel to key clients including Chief Information Officers, Chief Technology Officers, investment analysts, venture capitalists, technology policy executives, sell-side firms and technology buyers. Prior to joining Constellation, Dr. Kelly served for 10 years as a partner at Wainhouse Research where he was the primary author of most of the firm’s unified communications reports and forecasts. Dr. Kelly is a regular presenter at Enterprise Connect (formerly VoiceCon), the communications industry trade show where his well…...

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1. A wideband audio conference anchored in the Asterisk PBX. All participants used a Cisco phone along with a mono headset.
2. A narrow-band audio conference anchored in the Asterisk PBX. All participants used a Grandstream phone with a mono headset.
3. A wideband audio conference anchored in Dolby’s media server. All participants used Mac personal computers with USB-based stereo headphones and spatial speaker orientation was enabled.

• Dolby is on to something with its media server and client audio technology. The audio experience is clearly superior.
• When multiple people speak, Dolby’s audio is second to none. This is important because in an audio-only conference, there are no visual cues that enable people to avoid speaking over one another. This happens rather frequently, and the ability to distinguish these words and phrases is very helpful. Usually once people realize that someone else is speaking, one person stops, but this ability to distinguish words in these situations may relieve some of the cueing issues found in regular audio conferences.
• The Dolby solution does require stereo speakers or a stereo headset. This is an issue because most Bluetooth headsets and many high-end call center and executive Bluetooth, DECT, and wired headsets have only one ear bud or speaker. Dolby indicated that it is speaking with Bluetooth chipset manufacturers, encouraging them to develop stereo capabilities. (Plantronics was, interestingly enough, just across the hall from Dolby at this event, so the stereo headset message clearly got to that manufacturer.) At issue here is whether people will change their behavior and broadly adopt stereo headsets. From a vanity perspective, stereo headsets with a wire or a band connecting the ear buds or speakers will mess up a coiffed hairdo. Worrying about someone’s hair is possibly trivial, but probably not, particularly in an office setting or where people regularly switch between audio-only and video conferences.
• Dolby needs to address how the solution will work in a conference room. People will not come into a conference room and put on a headset.  

The Problem with Presence

Alumni: Constellation Research
Constellation Research

Dr. Brent Kelly is a Vice President and Principal Analyst at Constellation Research and President of KelCor, Inc. He focuses on the unique intersection of unified communications, social business, cloud services, video and mobility.  Dr. Kelly provides strategy and counsel to key clients including Chief Information Officers, Chief Technology Officers, investment analysts, venture capitalists, technology policy executives, sell-side firms and technology buyers. Prior to joining Constellation, Dr. Kelly served for 10 years as a partner at Wainhouse Research where he was the primary author of most of the firm’s unified communications reports and forecasts. Dr. Kelly is a regular presenter at Enterprise Connect (formerly VoiceCon), the communications industry trade show where his well…...

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1. Computer presence (logged in, tapped on keyboard lately),
2. Telephone presence (in a call, not in a call)
3. Calendar presence (in a meeting, not in a meeting)
4. Mobile phone presence (not all IM/presence engines can do this, but some can)
5. Location (some try to determine location automatically; for others, you must set it)
6. “What’s Happening” status (a simple message one can type into the buddy list indicating what one is presently involved with)

1. Update your presence status (or better yet, get a system that does most of the updating automatically). If the presence status is wrong, people won’t trust it and will use other methods to contact one another.
2. Don’t sleuth. It is annoying when someone sits on the network watching the presence status of others while not revealing their own. If you don’t want people to bother you, simply log off, and they will know to send you an email – or better yet, change your status to DND (do not disturb), and the person will send you an email.
3. Ask before you call. It is a courtesy that is both respectful and time saving. Most often, the person you are trying to contact will respond that they can take the call or tell you when they can take it. It just saves leaving a voice message or completely interrupting someone.
4. Keep IM to short transactions. If a conversation goes beyond just a few back and forth text exchanges, it is often faster and more productive to escalate the conversation to a phone call.

Microsoft Dynamics ERP on Azure: What Are the Benefits?

President, Computer Economics and Strativa, Inc.
Computer Economics and Strativa, Inc.

Frank Scavo is skilled at formulating and communicating IT strategy, developing the business case for new systems, and facilitating the selection of enterprise systems, such as ERP, CRM, and supply chain management. He is also an expert in benchmarking IT spending and staffing levels for end-user IT organizations. Frank was one of the first tech bloggers, beginning in 2002 with his launch of the Enterprise System Spectator providing independent analysis of issues and trends in enterprise applications software and the strengths, weaknesses, advantages, and disadvantages of the vendors that provide them. Frank has been quoted as an IT expert in numerous business and industry publications such as the New York Times, Wall Street Journal, Computerworld, CIO Magazine, ZDnet, eWeek, Datamation,…...

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Last week I attended Microsoft’s annual Convergence conference, for users and partners of its Dynamics line of enterprise applications. The back-to-back briefings were a great opportunity to get an update on where Microsoft is going with enterprise applications.

But the big news from my perspective is that by the end of 2012, two of Microsoft's ERP products, GP and NAV, will be available on Microsoft's Azure cloud.

Click on the video interview at the right for my initial thoughts, which I am expanding upon in this post.

Azure Complements Existing Hosted Offerings

Microsoft customers have always been able to deploy NAV (formerly, Navision) and GP (formerly, Great Plains) on-premises. In addition, some customers have chosen in the past to have Microsoft partners host their systems in partner data centers. MyGPCloud is one of the largest such partners, hosting GP for thousands of small business customers. Likewise, Tribridge offers similar hosting services for all Dynamics ERP products.

Now, Microsoft is offering customers the option to deploy their GP or NAV systems on Microsoft's Azure cloud, which runs in Microsoft data centers. This offering will not replace partner hosting but simply will be another deployment option for customers.

Through back channels, I've heard some partners express uncertainty about this new development. Is Microsoft attempting to go direct with customers? How will the partners make money? During the session, Microsoft executives made clear that, under Azure deployment, partners will still maintain the customer relationship and deliver the services for implementation and ongoing support. The only difference is that with the Azure deployment option partners will be relieved from the need to maintain data center infrastructure.

What Are the Benefits?

Over the past two years, I've been one of those encouraging the Dynamics team to go faster in moving to Azure, as cloud ERP is already available from competitors. But now that Microsoft is on the verge of actually doing it, I wanted to know, what are the benefits? Specifically, if customers can already have these systems hosted by a Microsoft partner--and if Microsoft will still work through partners in selling and supporting systems deployed on Azure--what are the added benefits of Azure?

I asked this question a year ago at Convergence and, frankly, the answers were not that clear. After asking this same question in several briefings this year, and adding my own analysis, I think the benefits picture is now emerging.

• Azure deployment is cheaper than hosting. Azure is a true elastic cloud platform, with data center economies of scale that traditional hosting cannot come close to matching. This should allow Microsoft to price these services at a lower cost than what partners can offer.
• Azure deployment scales beyond partner hosting. As a true cloud platform, Azure deployments can scale instantly beyond what partner hosting can offer. Hosted ERP relies upon dedicated resources, which must be planned and expanded manually to meet changing customer requirements. With Azure, customers will never exhaust the resources available.
• Azure supports worldwide deployments better than partner hosting does. Microsoft runs Azure data centers worldwide and can move customer systems and data between them as needed. Hosting partners do not have this capability, unless they are utilizing a true cloud IaaS, such as Amazon's EC2. The move to Azure is therefore a better choice for organizations that are running separate instances in different parts of the world.
• Azure deployment provides easier version upgrades. With partner hosting, upgrades and maintenance are handled more or less as they are with on-premises software: each customer is treated separately (though I suspect some partners are more organized about this than others). With Azure deployment, Microsoft will have a more disciplined approach to application management: rolling out new versions, upgrades, and patches to its customers, similar to what it does today with Microsoft CRM (even though, as I point out in the interview, CRM is not yet an Azure service).
• Azure deployment is provided directly by Microsoft. Most new prospects will have a higher level of comfort with cloud services provided directly by Microsoft and backed by the Microsoft brand and service level guarantees. Hosting is often delivered by service providers who are relatively unknown. The direct Microsoft relationship is also simpler and easier to explain. The software comes from Microsoft and the cloud services are delivered directly by Microsoft.

It is also important to point out at least one advantage of Azure deployment over partner hosting that Microsoft is not claiming--that is, that Azure deployment provides the ability to inter-operate with other Azure services, such as Office 365 or other future Azure data services (some of which I was briefed on). Microsoft has made a big deal about its vision of the so-called "hybrid cloud," meaning that customers will be able to move selected "workloads" to Azure while keeping other workloads on-premises or in partner-hosted data centers. Therefore, if I want to inter-operate Microsoft's Office 365 with my NAV system, it should not make any difference if my NAV instance is on-premises, in a partner data center, or on the Azure cloud.

Optimizing Azure as a Cloud Platform

I am struck by the fact that I've had to piece together this value proposition for Azure ERP myself, lobbing softball questions to Microsoft executives, parsing their answers, and adding my own analysis. If Microsoft itself is not prepared to articulate the value proposition of Azure ERP, how can it expect that its customers or its partners will perceive it?

Therefore, I do not envision customers and prospects staging a mad rush to Azure. As I said in the interview linked above, what if Dynamics throws an party and no one shows up?

Nevertheless, from a strategic perspective, I do believe that moving to Azure is the right thing for Dynamics. Mike Ehrenberg, one of only a handful of Microsoft Technical Fellows, told us an interesting story. He said that when they first spoke with CEO Steve Ballmer about moving Dynamics ERP to the cloud they told him that they could do it in one of two ways:

1. The quick way: hosting it in Microsoft data centers in a highly virtualized environment, as they had done with Microsoft CRM, or
2. The strategic way: working with the Azure team to optimize the Azure capabilities needed to support true scalable enterprise business applications, such as SQL Azure, until it could support Dynamics ERP.

Mike reported that Ballmer thought for about two seconds before choosing the second option. He likened it to Microsoft Windows and Microsoft Office, years ago. It took the requirements of Office as a set of user applications to make Windows "become better" as a PC platform. Likewise, it would take Dynamics as a set of enterprise applications to make Azure become better as a cloud platform.
The problem, of course, is that it's taking much longer to develop Azure as a enterprise-class platform. In the meantime, competitors such as NetSuite, Workday, SAP, Plex, and others have already become established as cloud ERP providers and have gained market share in this emerging market. Nevertheless, Microsoft entering this market later this year is a welcome development that will mean an increasing number of choices for buyers.
Postscript: watch for Part 1 of my market overview of cloud ERP over the next few weeks.

ALU Opentouch Conversation Raises the Bar for UC Tablets

Constellation Orbits
Constellation Research, Inc.

Elizabeth is a well-recognized industry-leading analyst. She was previously Vice President and Principal Analyst at Constellation Research.  Prior to Constellation, Elizabeth spent eleven years at Forrester Research as vice president and principal analyst.  She has managed large consulting projects for business and government organizations and provides technical insight and guidance to business and government organizations on their communication issues. Prior to her role as an industry analyst with Communication Initiatives and Forrester Research, Elizabeth held senior management positions with IBM, ROLM and Siemens ICN where she was a senior manager for strategic planning and alliances. Expertise Elizabeth’s expertise includes in-depth knowledge of unified communications,…...

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Alcatel-Lucent (ALU) unveiled its new Opentouch Conversation Tablet at Enterprise Connect and delivers a truly unified solution.  Unlike many business tablets that provide unified communications (UC) features, the ALU Opentouch software provides a highly sophisticated single architecture that supports multi-party, multi-devices and multi-modal conversations running its UC software on the iPad.  What could have been complex and cumbersome is actually a sleek solution on a single application to deliver this robust functionality.

The ALU Opentouch Conversation has several advantages that provide competitive differentiation.  It supports multiple devices –the desktop phone, smart phone, tablet, video and PC/MAC- all from a single interface and requires only one user license for all devices. One server can support up to 1,500 end-users greatly reducing the hardware footprint required by other vendors’ offerings.  The user can continue a conversation without interruption when going from one device to the other.  It also offers presence capabilities so a user can view the availability of another prior to contact.

Its initial release initially supports the iPad, which is currently the favorite tablet among business professionals.  Future release will also support other tablet devices.   The ALU solution stands out because it truly offers a unified experience for the user, which has been a promise of UC that in reality required the integration of many components.   As the tablet is becoming the device of choice for many business professionals, ALU engineered a solution that I believe is worth serious consideration.

Constellation Research Releases Details of New Research Theme – Technology Optimization

Event Report: IIAR UK Forum & The Future Of The Industry Analyst, Legacy Vs Disruptive

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 Research Inc. He…...

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Legacy Analyst Firms Vs Disruptive Influencer Firms

On March 14th, 2012 Constellation had the privilege and pleasure of presenting at the IIAR UK Chapter’s monthly meeting moderated by Simon Levin (see Figure 1).  For those who don’t know, the IIAR is a “not-for-profit organisation established to raise awareness of analyst relations and the value of industry analysts, promote best practice amongst analyst relations professionals, enhance communication between analyst firms and vendors, and offer opportunities for AR practitioners to network with their industry peers.”  IIAR has been responsible for raising both the visibility and standards of analyst relations and influence relations professionals.

Figure 1. IIAR UK Forum – March Meeting

(Source: R Wang)

The topic of the March monthly meeting – the changing nature of analyst firms. Constellation’s EMEA team of Alea Fairchild – Brussels (@afairch), Charles Brett – Madrid and Tel Aviv (@charlesbrett) and Paul Papadimitriou – London (@papadimitriou) presented their points of view as IIAR members asked tough and insightful questions about the new model and provided candid feedback.  During the discussion, we also had the opportunity to describe the new analyst firm model and how we have designed our offerings for both the existing and new research firm service buyers.  After the meeting, we put together some notes and came up with a summary between the legacy analyst firms and new and emerging disruptive firms (see Figure 2).  Here’s a quick summary of five major areas:

1. Client types. Legacy analyst firms support the established buyers – IT.  By nature, a disruptive firm thrive on innovation and attracts innovators in an organization from both IT and business.
2. Design point. Legacy analyst firms bind analysts with non-competes and treat employees as cogs in the wheel.  Disruptive firms build the firm around the sum of personal brands and embrace principles that support the future of work.
3. Analyst access. Legacy analyst firms block analyst access through expensive pay walls and contracts.  Disruptive firms break down barriers to access and provide research as a service models of access.
4. Research approach. Legacy analyst firms work in ivory towers and take a conservative outlook.  Disruptive firms embrace the community for input, feedback, and co-creation to deliver pragmatic innovation.
5. Sales.  Legacy analyst firms apply a transactional model to sales.  Disruptive firms build relationships with stakeholders and sales professionals serve as advisors into the research firm’s capabilities.

Figure 2. Comparing the Legacy Analyst Firm With Today’s Disruptive Firms

The Bottom Line – Technology Buyers Have Shifted To The Business Side And Market Disruption Is Imminent

With IT spending down 5% year over year and tech spending up 18 to 20%, disruptive firms emerge to support a growing and influential buyer type – the business.  As business examines new approaches, they seek a second opinion to the traditional IT point of view from legacy analyst firms.  The market exists for new firms to support the new buyers and guide them through the growing and dizzying array of disruptive technologies not just for technologies sake.  The goal – apply emerging technologies to create differentiated and disruptive business models.  That’s the objective for Constellation and a number of new disruptive firms.  That being said, we encourage the legacy analyst firms to stay the course and play their key role in supporting IT.  There’s room for both!

Your POV.

We’d love to hear your point of view on how analyst firms can do a better job, including ours!  We’re hoping to incorporate your feedback into our 2H 2012 planning meeting July 2012.  Let us know your experiences.  Add your comments to the blog or reach me via email: R (at) ConstellationRG (dot) com or R (at) SoftwareInsider (dot) com.

Related Resources And Links

20120315 IIAR – Duncan Chapple “More stars move into the Constellation”

20110202 R Wang “Trends: Influencers Aspire For Market Maker Status”

20111109 Technobabble 2.0 – Jonny Bentwood “Introducing Constellation Research”

20100724 R Wang “Personal Log: The 7 Tenets Of Building A “Star Analyst” Firm”

Reprints

Reprints can be purchased through Constellation Research, Inc. To request official reprints in PDF format, please contact sales (at) ConstellationRG (dot) com.

Disclosure

Although we work closely with many mega software vendors, we want you to trust us. For the full disclosure policy, stay tuned for the full client list on the Constellation Research website.

Copyright © 2001 – 2012 R Wang and Insider Associates, LLC All rights reserved.

News Analysis: Spinnaker Expands JD Edwards Support With Versytec Acquisition

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 Research Inc. He…...

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Versytec Acquisition Addresses Growing Demand For JD Edwards Support

Denver, Colorado based Spinnaker Management announced on March 6th, 2012 its acquisition of competitor Versytec.  For those who remember their third party maintenance (3PM) history, Versytec was among the first firms to announce third-party maintenance services within a year after PeopleSoft acquired JD Edwards in July 18, 2003.  Constellation estimates that Nashua, New Hampshire based Versytec had between 35 to 40 active 3PM customers.

Third-party maintenance describes support and maintenance offerings delivered by non-OEM providers. These vendors can provide a range of options from basic break/fix to bug fixes, performance optimization, tax and regulatory updates, and customization support. Keep in mind, 3PM does not provide access to upgrades and future versions of the OEM’s product. One big driver is the lower cost of delivery, as much as half the cost of the original vendor’s pricing.  Today most customers pay in maintenance and support the equivalent of a new license every 5 years without achieving the value.  For an average JD Edwards customer that upgrades every 15 years, that’s three times the cost of the original license cost.  In the latest Constellation research report, third party maintenance is one of many strategies to free up millions for customers to fund innovation.

The Spinnaker-Versytec deal is important for a few reasons:

• Many JD Edwards customers seek alternatives to Oracle’s pricey maintenance fees. Software ownership costs continue to escalate as vendors accelerate their efforts to capture support and maintenance revenues.  From inquiries, surveys, and conversations on the ground, many Oracle JD Edwards World and EnterpriseOne ERP customers seek options to buy-time as they consider whether they upgrade or migrate from their current version.  Why?  Most JD Edwards customers run stable environments and do not gain any value from the Oracle one-size fits all 22% support policy.  Most customers seek phone support and tax and regulatory updates.
• The market needs more options and choices in the third party maintenance market. Many OEM vendors have gone to the extreme to eliminate third-party options for their customers.  This anti-competitive behavior takes away choice for the customer. A bulked up Spinnaker creates a viable organization that has the critical mass to compete with Oracle.   The combined entity provides third party support services to an estimated 100 160 JD Edwards customers across the globe.
• Spinnaker Support offers a different approach to third party maintenance. Spinnaker couples its third party maintenance options with consulting services providing a one-stop shop for JD Edwards customers.  Spinnaker also differentiates in its download methodology of customer entitled IP from Oracle.  Spinnaker provides customers with a checklist of what to download prior to migration off Oracle support.

The Bottom Line: Users Must Advocate for Third-Party Maintenance Rights Across the Technology Stack

Vendors continue to conspire to remove third-party maintenance as an option for their customers. What’s extremely disturbing is how vendors are working hard to prevent customers from having third-party maintenance options. The notion of perpetual software license rights should include the right to self-support software or engage in a third party to provide tax, regulatory, and additional updates. As many vendors try to close up these loopholes, customers are left in a no-man’s land position of being forced into de-facto maintenance contracts with only the vendor.

End users need to band together and collectively demand clear rights to third-party support options. Based on survey data, most already believe or feel that 3PM should be a right.  Otherwise, users will face a situation similar to automakers forcing drivers to only go to them for maintenance. If some of the industry’s largest systems integrators actively entered the third-party support market, it would effectively disrupt the balance of power and put more money into the hands of the end-users and the system integrators.

Figure 1. Visualizing the High Costs of Support And Maintenance

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Your POV.

Need help with your software contract or working out the rationale for third party maintenance?  Contact us throughout the vendor selection or negotiation process.  We can help with a quick contract review or even the complete vendor selection.  We provide fix-fee and gain sharing arrangements.

Let us know your experiences.  Add your comments to the blog or reach me via email: R (at) ConstellationRG (dot) com or R (at) SoftwareInsider (dot) com.

How can we assist?

Buyers, do you need help with your apps strategy and vendor management strategy?  Trying to figure out how to infuse innovation into your tech strategy? Ready to put the expertise of over 1500 software contract negotiations to work?  Give us a call!

Please let us know if you need help with your next gen apps strategy efforts. Here’s how we can help:

• Providing contract negotiations and software licensing support
• Evaluating SaaS/Cloud options
• Assessing apps strategies (e.g. single instance, two-tier ERP, upgrade, custom dev, packaged deployments”
• Designing innovation into end to end processes and systems
• Comparing SaaS/Cloud integration strategies
• Assisting with legacy ERP migration
• Engaging in an SCRM strategy
• Planning upgrades and migration
• Performing vendor selection

Related Constellation Research

Scavo, Frank & Wang, R. “Big Idea: Constellation’s Business Value Framework.” Constellation Research, Inc.  January 31, 2012.

Wang, R. “Best Practices – Three Simple Software Maintenance Strategies That Can Save You Millions” Constellation Research, Inc. March 7, 2012

Wang, R. “Best Practices: Why Every CIO Should Consider Third-Party Maintenance.” Constellation Research, Inc. August 7, 2012.

Wang, R. “Market Overview: The Market For SAP Optimization Options.” Constellation Research, Inc. May 11, 2011.

Wang, R. “Best Practices: The Case for Two-Tier ERP Deployments.” Constellation Research, Inc. February 28, 2011.

Related Resources And Links

20120318 Research Summary: Best Practices – Three Simple Software Maintenance Strategies That Can Save You Millions

20100419 Tuesday’s Tip: Dealing With Pesky Software Licensing Audits

20090714 Research Summary: An Enterprise Software Licensee’s Bill of Rights, V2

20101214 Tuesday’s Tip: Dealing With Vendor Offers To Cancel Shelfware And Replace With New Licenses

20100308 Monday’s Musings: Decoupling Support From Maintenance – What Apps Vendors Can Learn From Microsoft Dynamics

20100222 Monday’s Musings: Why Users Should Preserve Their Third Party Maintenance Rights

20100104 News Analysis: SAP Revives Two-Tier Maintenance Options

20090210 Tuesday’s Tip: Software Licensing and Pricing – Do Not Give Away Your Third Party Maintenance And Access Rights

20090709 Tuesday’s Tip: Do Not Bundle Your Support and Maintenance Contracts!

20091222 Tuesday’s Tip: 10 Cloud And SaaS Apps Strategies For 2010

20091208 Tuesday’s Tip: 2010 Apps Strategies Should Start With Business Value

20091102 Best Practices: Lessons Learned In What SMB’s Want From Their ERP Provider

20091006 Tuesday’s Tip: Why Free Software Ain’t Really Free

20090504 News Analysis: Oracle Waives Fees On Extended Support Offerings

20080909 Trends: What Customers Want From Maintenance And Support

20080215 Software Licensing and Pricing: Stop the Anti-Competitive Maintenance Fee Madness

20090405 Monday’s Musings: Total Account Value, True Cost of Ownership, And Software Vendor Business Models

20090324 Tuesday’s Tips: Five Simple Steps To Reduce Your Software Maintenance Costs

20090223 Monday’s Musings: Five Programs Some Vendors Have Implemented To Help Clients In An Economic Recession

20091012 Research Report: Customer Bill of Rights – Software-as-a Service

20090910 Tuesday’s Tip: Note To Self – Start Renegotiating Your Q4 Software Maintenance Contracts Now!

20090721 Tuesday’s Tip: 3 Approaches To Return Shelfware

20090127 Tuesday’s Tip: Software Licensing and Pricing – Now’s The Time To Remove “Gag Rule” Clauses In Your Software Contracts

Reprints

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Disclosure

Although we work closely with many mega software vendors, we want you to trust us. For the full disclosure policy, stay tuned for the full client list on the Constellation Research website.

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