You are currently browsing the monthly archive for February 2012.

Now finishing our first decade of providing research and education for business and IT professionals, we at Ventana Research have learned what it takes to improve the value of processes and performance in many industries. This is no easy task; it requires thorough and wide-ranging research on the best (and worst) practices that organizations need to understand as they try to increase their competency and effectiveness – and our firm is committed to that work. For 2012 we are moving forward from the business technology revolution agenda we outlined at this time last year, including business analytics, business collaboration, cloud computing, mobile technology and social media. We have added a focus on big data, a trend that has reinvigorated the dialog about managing large volumes of data and how to use it effectively. Our research framework spans a diverse set of research agendas and practices from the viewpoints of the lines of business, IT and specific industries and knits together the necessary strategies and best practices across the four critical aspects of people, processes, information and technology.

Our research agendas for 2012 again will help your organization balancing its investments in enterprise software to ensure that they deliver business value. Our expertise is built from delivering hundreds of benchmarks and harvesting insights from the more than 240,000 members of our community. The facts we’ve discovered from research and experience contribute to building relevant best practices that can save you time and reduce the risk of not achieving your full potential. More than ever it’s a challenge to find the time to understand how to get the largest return on your technology investment in the shortest period of time. I am obviously a big believer in the kind of research that as I wrote last year is diminishing rapidly in analyst firms that tout themselves to be experts without putting in the thought and effort necessary to become them.

In this context I am proud to offer the following well-defined and methodical research agendas and insights for 2012. Thanks to all of you for rating me as the number-one industry analyst in enterprise software for 2011 as determined by the Institute of Industry Analyst Relations. That sort of recognition is most meaningful because it comes from the community that utilizes our research to help improve their competencies and extract full value from technology.

Here are the six areas of business technology innovation that can help your efforts in 2012 whether you are in business or IT but have a significant responsibility for your line of business’s efficiency and industry competitiveness.

Big Data

The variety, volumes and velocity of data being generated by businesses and received from consumers or customers on the Internet are huge and increasing, and managing it all poses a major challenge for organizations. What is colloquially called Big Data has become a point for serious discussion between business and IT as they try to figure out how not only to derive value from data-related investments but also the benefits that can come from understanding and acting on the data. Our firm conducted benchmark research on Big Data to determine how organizations are adapting to this information management challenge and working it into their business technology strategy. Managing and utilizing big data requires a framework of technologies that starts with efficient storage and integration with other data, moves to whatever processing is needed, including analytics, and extends to providing access so users can apply the analysis to their operational or decision support needs. As organizations realize they must diversify their data strategies beyond a single database and the RDBMS approach to serve the entire business, the range of technologies available to assist this change includes data appliances, in-memory computing and Hadoop. As our research shows Hadoop is fast becoming a critical component of many information and analytic strategies. Organizations that do not have solid information management practices and people who understand the information life cycle will struggle in dealing with big data in the short term.

Business Analytics

Competitive pressures force businesses to operate smarter and move faster. To do this requires having the numbers that can help business understand the past and present and anticipate the future. These numbers, often called metrics, can be used to create a range of relevant business indicators about people, performance, processes, risk and factors to guide actions and decisions across business. This is the realm of business analytics, and our benchmark research involving thousands of organizations found large gaps among organizations of all sizes and industries in terms of the business and IT skills, processes, data and technology they use to help obtain the most timely and useful information. To acquire superior business analytics organizations must invest resources and time to find the right technology to help them not just address obvious problems but discover new opportunity. We assert that they need dedicated tools that go beyond personal productivity tools like spreadsheets in order to design analytics appropriate for the roles and competency levels of their users and able to deliver insights and actions.

Business Collaboration

It is clear that organizations need to harness the potential of their people to work together more regularly to boost performance and productivity. Despite the widespread adoption of electronic communications, however, the state of collaboration within most organizations has not matured much beyond sending files by email and using web conferencing. A new generation of business collaboration utilizes the lessons learned and user experiences from social media led by Facebook, LinkedIn and Twitter and now new digital magazines. Users of social media are both consumers and employees, and they think that in the enterprise it should be as simple to connect to people and interact for working purposes as for interacting with friends. Smart executives sense that effective collaboration can advance the mission of the workforce while also providing high levels of employee satisfaction and thus talent retention. Our forthcoming research into next-generation workforce management and business intelligence will uncover exciting new trends and best practices in business collaboration in the context of specific organizational needs. Our latest benchmark research into managing sales performance identified new demands for using wall posting, broadcasting or Twitter-like capabilities in sales. These are among the new methods to utilize collaboration technologies to serve the needs of the overall business or the nuances of roles within a line of business.

Cloud Computing

The cloud computing phenomenon has changed the basis of providing enterprise software with software as a service (SaaS). Obsolescence of enterprise software, the arrival of appliances that combine hardware and software, the challenges of fewer resources and capacity of in-house IT have driven organization to embrace cloud computing for a range of needs beyond standard business applications. Businesses that have come to accept cloud computing have found that they can establish and make available a range of capabilities in days rather than months. Cloud computing also is an avenue to acquire new capabilities such as those I’ve just discussed here (big data, business analytics and business collaboration) as well as making software readily available to mobile technologies including smartphones and tablets. But we recognize that, whether it is a public cloud used as a service or a private cloud just for one business, users need to integrate at the data and application levels with their on-premises enterprise systems; our research on Business Data in the Cloud explores this side of cloud computing. In any case, organizations that do not evaluate the use of cloud computing are needlessly closing off a path to business effectiveness.

Mobile Technology

Smartphones and tablets  are bringing consumers and business professionals into a single global environment. The instant availability of computing activated by the stroke of a finger has radically changed the expectations of workers who think that business-focused enterprise software should be much simpler and intuitive to interact with and use to complete tasks. In 2011, the shape of a new generation of applications and tools on mobile technology began to impact the user experience of enterprise software. Our benchmark into business analytics and sales found that fast access is of growing importance to business while IT struggles to move beyond its protective BI supplier mode and access control. Our forthcoming research into next-generation workforce management and business intelligence will uncover exciting new trends and best practices in mobile technology in the context of specific organizational needs. The battles of Apple vs. Android for dominating the smartphone and tablet markets are of serious interest to businesses. The other vendors of mobile products – Hewlett-Packard, Microsoft, Nokia and RIM – have fallen from prominence and are becoming irrelevant to the technology’s intersection with enterprise software. The rationalization of technology suppliers allows software vendors to provide their applications in the native capabilities for fuller functioning. We will be eagerly tracking a new wave of mobile business computing that will help willing organizations innovate as workers play an unprecedented role in determining their future working environment.

Social Media

The viral nature of social media has made large corporations and even nations feel the impact of people who harness their voices in a directed manner. Using Facebook and Twitter, LinkedIn, FourSquare and Yelp, consumers and business professionals confront each other in an immediate manner has forced lines of business, from marketing, sales and service to manufacturing and supply chains, to change the way they operate. Social media is a new wave of influence that can reach the CEO of a company as well as its customer service agents as the opinion of one consumer, broadcast to millions of others, echoes in every level of an organization. Social media makes it easier and faster for businesses to determine customer satisfaction and the usefulness of interactions, though they may not like what people say about their customer experience and our new research into customer feedback will assess if organizations are taking it seriously. Our benchmark research on customer relationship maturity finds that businesses are not yet taking steps to use social media to stay ahead of their competition. New research that we will conduct on next-generation marketing processes will look at social media as a method to develop intelligence about customers and how to engage and deliver relevant interactions that are profitable while delivering superior customer experiences. And social media has other business uses, such as helping find and recruit talent in larger pools of people from Facebook or LinkedIn. Our benchmark Social Media in Recruiting found those who value finding the best talent embracing the social channel as critical to reducing cost and time to hire. These examples provide evidence that the impact of social media goes well beyond the “what are they saying about me?” aspect and that it should be part of every organization’s strategy.

Regards,

Mark Smith – Chief Research Officer

Even in this recessionary economy Informatica has been defying spending constraints. At its annual analyst summit (Twitter #INFAAnalyst) the company unveiled its growth strategies. Informatica has more than 4,500 customers for data integration and information management and now is turning its attention to the data in social media networks. Our firm has already identified social media as a key technology that businesses must embrace over the next decade to improve competitiveness or just keep up. Informatica already helps IT departments become better data stewards through a variety of methods and supports the executive mission of the CIO. My colleague David Menninger will comment on its vision and direction for its data integration portfolio; I will focus on its decision to use its technology for social media, which is part of a forthcoming product roadmap. Regarding the importance of embracing social media in this area, see David’s research and educational agenda in information management for 2011.

Informatica is trying to help organizations improve marketing, sales and customer service not only by integrating social media information into its data repositories but also within social media applications themselves. Having 850 million active people in Facebook and 100 million in LinkedIn creates mass channels to connect both business people and consumers and creates data sources rich in behavioral and demographic information that business are beginning to covet. (By the way, whenever a vendor starts marketing its ability to provide technology for social media, I do a quick analysis of its spokespeople’s use of social media; at Informatica, many of its technology leaders are on LinkedIn and Facebook, but many are not very active on Twitter. I think they should cover all the bases and engage its own social media promotion of its technology.)

At the analyst summit Informatica demonstrated how its data integration technology can tap into social media data repositories and more importantly link them to corporate data repositories and applications for use in new business initiatives. To make it clear, Informatica is providing the data integration technology to automate and streamline these efforts but not the actual applications that a business would use to deploy into social media channels. I see two key areas in which Informatica’s products can add significant value in utilizing social media data.

Informatica has been advancing its master data management (MDM) product to ensure easier governance and linking of internal data for business needs. Now it is addressing the challenge of linking the data that comprises an organization’s corporate identity with its social media identity. This is no easy task since there is no obvious connection between these business and personal worlds until the customer acknowledges it by linking an account number to a social media channel like Facebook or LinkedIn. To advance MDM and the potential of what Informatica calls Social MDM, it has hired industry veteran Dennis Moore (Twitter @dbmoore) to lead its efforts. Having worked at enterprise software heavyweights Oracle and SAP, he knows the challenges of not just creating data but housing and preparing it for further use. Informatica’s technology helps ensure a consistent identification of the individual across various social medi channels. 

Executives Ivan Chong (Twitter @ichong) and Girish Pancha (Twitter @GirishPancha) outlined how Informatica applies its data quality technology to social media. If an organization makes a link between an individual identification (technically called a party) and a social media ID, the Informatica tool can enrich and augment the data with more information found on social media channels. This enriched data could include the individual’s location, industry, favorites, birthday or other information the person has authorized to be shared. Having a complete record is critical to effectively engaging customers in marketing, selling and service. 

Applying information management to social media can serve the needs of business and the CIO. Initiatives to link social media are being driven by marketing and business executives who seek to bring their corporate presence and accessibility to products and services to social media. Following an onslaught of new social media applications that also operate on mobile devices, the amount of information available in social media channels is huge. Informatica’s challenge here is to bring its technology for new social media initiatives in business to the attention of these leaders, who likely are not familiar with this provider of data integration technology. Informatica demonstrated how its technology would work with a Facebook application and a company example called Hot, which was interesting but somewhat confusing in its approach. I tried to access the example on Facebook but could not find it; apparently anyone in marketing who wants to access and try it will have to talk to Informatica. I recommend that Informatica apply the technology to its own customers and developer network to demonstrate how it works for their businesses and then look at how it can advance its marketing efforts as good steps to validate the new capabilities.

One of Informatica’s key technology partners is MicroStrategy, which has launched new products for social media intelligence that I recently assessed (See: “MicroStrategy Infuses Social Media Intelligence into Marketing”) and develops social media applications on its mobile application platform. It is interesting that neither of them is promoting the other in the social media realm. There is a natural bond between the two companies and they have found success together in the business intelligence and data integration markets, so I wonder why they are not more connected in their social media initiatives. MicroStrategy is investing in its Gateway products, which already link to Facebook and is expanding to other social media channels; why not leave the data-related side of social media to Informatica? The two are partnering on MicroStrategy’s cloud computing services. MicroStrategy could build the social media business applications and Informatica could provide the data integration to bring the data together in a consistent form. Together the two companies could become a social media business software heavyweight.

Informatica has taken the most progressive position of any vendor in data integration and information management toward social media. Now it will have to educate marketing and social media executives to perceive what it offers as part of the technology requirements for their initiatives or hope that IT gets involved to recommend Informatica as the key provider of data integration technology. As part of this effort, Informatica should build an ecosystem of partners like MicroStrategy and others that are closer to the applications and systems used by marketing and will name it as the trusted data integration provider for social media. Another example for Informatica would be to work with recruiting application software companies who are beginning to link social media sources as a channel to find pools of new talent that our benchmark in social recruiting found to be a top priority. In addition Informatica should link this to its cloud computing efforts, through which social media operates and which will require integration from on-premises and other cloud-based systems. 

Informatica has taken the lead on the integration of data from social media into business. I applaud this move, which should help it grow from 2011 revenue of $784 million to be more than a three billion-dollar software company over the next decade. Informatica’s success in helping customers process large volumes of data is evident, and our firm recognized Informatica and its customer in our 2011 Ventana Research Leadership Award for Big Data. In addition Informatica has deepened its value for the lines of business, which I advocated in my analysis and recommendations last year. The largest challenge for Informatica is to make all of this simpler to do  using its Informatica PowerExchange for Social Media and further outlined in this product brochure I found by searching on the Informatica website. It provided some great examples at the analyst summit and now needs to communicate a product roadmap and release schedule for its new social media endeavors beyond the PowerExchange connectors. Consider a dialog with Informatica  to determine how it can help you integrate and use of data from inside your business with social media data. 

Regards,

Mark Smith – CEO & Chief Research Officer

Mark Smith – Twitter

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