Susanne Hupfer, Consultant, IBM Center for Applied Insights
Our director, Steve Rogers, recently interviewed Paul Brunet, IBM Vice President of ISVs, Start-ups, and Academic Programs, about his perspective on the 2012 Tech Trends study. Whether you're an IT or business decision-maker, an academic, or an IT practitioner, you may discover valuable insights and recommendations in their broad-ranging conversation.
IT and business leaders:
Why are CEOs regarding technology and skills as top concerns -- now outranking even market and economic forces? Why is it crucial to leverage emerging technologies for competitive advantage?
Paul discusses four technology areas -- mobile, cloud, social business, and business analytics -- and contrasts adoption and skill levels in mature and growth markets. He covers challenges to adoption -- such as security, skill gaps, and integration -- and explains why security is a business imperative. IT and business decision-makers may also be eager to learn more about the elite "pacesetter" group identified by the study, who are unlocking competitive advantage by being more market-driven, experimental, and analytical.
How can academia better monitor the needs of the enterprise and teach relevant skills their students will need upon graduation?
Paul also examines how using sandboxes and collaborative spaces can encourage experimentation, skills development, and collaboration across universities and practitioner areas.
Where should you be expanding your skills? What traits are IT leaders looking for today?
Paul and Steve talk about the importance of integrating business along with IT skills.
You can check out the full podcast here.
(24:16, 22.2 MB)
Client Insights, Senior Consultant
Center for Applied Insights
In 2012 we saw significant data breaches across multiple industries and governments impacting millions of users. Will 2013 bring more of the same? Is this an uncertain future we will have to live with? Can we accept degraded privacy and security and billions of dollars in lost revenue, damage, reduction in brand value and remediation costs?
Last year, a number of major security themes were part of this uncertainty – cloud, mobile, social media, big data, compliance, advanced persistent threats, physical infrastructure security, and the changing nature of information security leadership. None of these issues are going anywhere. In fact, into 2013 and beyond these issues are only going to become more important and will become the concern of more and more enterprise leaders.
All of these disparate issues come together in a new infographic from IBM. It knits together the pressures CEOs are feeling to deliver transformation with limited resources, the changing role of information security leaders, the threat landscape and the best practices to address that landscape. It connects enterprise priorities with information security practices, achieving innovation while dealing with risk.
In 2012, the IBM Center for Applied Insights released a series of security-related pieces that focused on a number of these important issues. We looked at the changing role of the CISO and other security leaders in our 2012 CISO Assessment. We also published a series of best practices for security leaders through our eight article Security Essentials series. In 2013 we will continue to provide insights on information security.
What does IBM think the future of security will look like? IBM security experts and leaders have developed lists of ideas for 2013 and beyond. Highlights include:
- Enterprise security organizations will become more independent and work with the audit committee and risk officers more.
- Data scientists will increasingly analyze and correlate security data as well as unstructured business data to reduce the risk of breaches.
- Threat data will be shared more readily between the government and private sector, and amongst private sector companies.
- Organizations will begin monitoring the information shared on social media back channels to detect threats earlier.
- Compliance will remain a strong security driver and will be weighed against the rise of a risk-based approach to security.
- Because of data, identity and monitoring technologies, cloud security will go from "mystery and hype" to "secure and move-on".
- Mobile devices (the device, network and applications) will be significantly more secure – more than laptops are today.
- The type of data collected and inspected to detect advanced threats will increase in variety and volume.
Keeping these ideas, trends and emerging issues in mind, information security leaders must rise to the challenge of creating a future that isn’t like today. By using their best practices to connect with and support enterprise-level goals they can create a better, more secure, future.
To download a copy of the infographic below, click HERE.
Consultant, IBM Center for Applied Insights
IBM just released the results of its 2012 Tech Trends study, revealing a number of interesting insights.
The study explores how enterprises are responding to the opportunities and risks introduced by new technologies. This year, we surveyed over 1,200 IT and business decision makers to determine why, when, and how their organizations adopt four pivotal emerging technologies – mobile, analytics, cloud and social business technologies – that are rapidly reshaping how enterprises operate.
Are you in the lead, or is your organization falling behind? You can use the adoption and investment statistics we discovered to help you assess where your organization stands:
Business Analytics and Mobile Computing are already quite mainstream, with over 50% of respondents deploying. Cloud Computing and Social Business represent a coming wave, with 40% either already piloting the technologies, or planning to adopt them within two years. Moreover, planned investment levels in the four technologies over the next two years indicate that all are moving full steam ahead: 55% or more of respondents plan to increase investment in Mobile, Cloud, and Business Analytics, and 43% plan to increase their investment in Social Business. You can click on the following infographic to take a deeper dive:
Despite the foothold of these technologies and the enthusiastic investment landscape, the report cites critical IT skill gaps that threaten to slam on the brakes just as organizations are hoping to leverage these technologies for their strategic advantage:
- Across all four technology areas, only roughly 1 in 10 companies report having all the skills they need to be successful, and one-quarter of respondents report major skill gaps.
We also surveyed about 700 educators and students about these technology areas, and according to their responses, the skill gap is poised to get even worse:
- About one-half of academic respondents report major gaps in their institution’s ability to meet the needs of the IT workforce.
Security also continues to be a major concern. In fact, Security is rated as the #1 barrier to adoption for mobile, cloud and social business, and the #2 barrier to adoption for business analytics.
What can you learn from those making the most progress applying these technologies for strategic advantage?
We asked respondents to rate the four emerging technologies’ importance to their businesses and also to rate their enterprises’ pace of adoption relative to competitors. We identified an elite group of Pacesetters who are forging ahead faster than others – despite the adoption hurdles – and who are using emerging technologies in more strategic ways.
If you want to get your organization onto the technology fast track (or keep it there), there are a number of interesting lessons you can take from the Pacesetters. We found that Pacesetters are more likely to exhibit three distinguishing traits that help them capitalize on the potential of mobile, analytics, cloud and social technologies. They are:
- More market-driven
- More analytical
- More experimental
So, how are Pacesetters managing to stay ahead of the competition? As it turns out, they’re very experimental in their approach to developing IT skills. Rather than wait until there’s clear business demand for new skills, Pacesetters start building skills ahead of time: they are nine times more likely to experiment with technologies that don’t yet have a clear business application, and twice as likely to proactively develop skills to meet anticipated needs.
To learn more about the study results and how you can follow the pacesetters’ lead in technology adoption, you can check out the complete IBM 2012 Tech Trends report
and a variety of other resources.
Don't miss the paper's list of concrete recommendations for becoming Pacesetters. We invite you to join in the discussion and let us know what you think about the study and its recommendations!
Client Insights, Consultant
IBM Center for Applied Insights
Not many people empathize with financial markets firms these days. Yet, they are facing a one-two punch of increasingly onerous regulation combined with increased competition (a result of more demanding customers, technological change, globalization and the downturn in the global economy).
Industry experts estimate that 15-20% of the market share for wholesale and investment banking will be reshuffled in the next few years. To survive let alone thrive, financial markets firms must adapt – by changing the way that they operate.
Working with Broadridge Financial Solutions we looked into how financial markets firms are responding to this demanding environment – and specifically the changes they are making to their operating models – that is how they organize their resources, business processes, systems, information assets, etc.
The research highlighted a leading group – who excelled at both compliance and innovation. This group had five key things they were thinking and doing differently than the rest:
- Thinking marketplace first, “factory” efficiencies second
- Designing operations around client interactions, not vice versa
- Cultivating agility – and an ability to see what others don’t
- Building and use scale, but not always in expected ways
- Partnering to extend their capabilities – and their thinking
These firms have a different perspective on operations and how it contributes to the business. The distinctions between front, middle and back office are becoming less distinct. As a UK-based Chief Operations Officer at a Universal Bank observed: “We must make sure changes enhance the whole process - It’s no good having a Rolls-Royce in the front and a Mini in the back.”
The leaders are looking at how operations can positively contribute to the business – through consolidation and greater efficiency of course, but also through creating the flexibility to scale resources and adapt to market conditions, facilitating faster product development and enabling innovation.
The leaders are also more open to working with external partners – and see the positive value to be gained through collaboration, for example accessing the technology and resources of an external partner. Leaders outsource more of their business processes, in particular, traditional areas like back-office accounting, settlement and clearance and reporting systems.
Success in these areas will likely encourage leaders to forge ahead into sourcing more complex functions such as reconciliations, data management, tax reporting and corporate actions. But what they outsource is perhaps of less interest than how they outsource. The leaders outsource with a business objective in mind, seeking to get the best from their partner, whereas those lagging tend to see the potential benefits in a more limited way – focusing on cutting costs of the back office.
And importantly, the study points to these differences in attitude feeding into improved results. Those who recognize how operations can contribute to the business and see collaboration as a way of improving business outcomes are rewarded with improved customer satisfaction, faster product introduction, improved regulatory compliance and improved access to information.
So what are the implications, for firms operating in financial markets as well as those in other industries who are trying to optimize the contribution of their back offices? For financial markets firms - focus on achieving agility, scalability and customer centricity, with the potential help of external partners. Many of those currently lagging are planning to evolve their operating model over the next three years. However, there is no time to delay, as the leading firms are forging ahead, and gaining market share as a result.
For those in other industries seeking to optimize their back office operations, this study also provides valuable insights. The financial markets industry is an extreme case where technological change, globalization, market turmoil, low switching costs and significant regulatory change have come together accelerating required operating model change. But the drivers are similar in many other industries – and we are observing a transformation in approaches to outsourcing – focusing more on sharing expertise and delivering business value rather than simply efficiency savings. Increasingly, the winners, across all industries, will be those who exploit these new capabilities to the full.
Consultant, IBM Center for Applied Insights
In my previous blog post on How Leading Marketers Outperform, I discussed how Leading Marketers develop a system of engagement
that drives customer value at every touch.
Today, I’m going to focus on the other side of that equation and dig a
bit deeper into what prevents many marketing organizations from becoming Leading
The first question you might ask is “why doesn’t everybody
just establish a system of engagement?”
The short answer is because it’s not easy. A look at the barriers both Leading Marketers
and others face in implementing marketing technology is very telling.
To begin with there are a set of barriers we found that are
common to virtually any technology decision: cost, ROI, and organizational structure.
If we continue looking, the additional barriers for leading marketers are ease of
use and lack of appropriate user skills.
Alternatively, we found that some others are more concerned with
alignment/collaboration within the organization – particularly with IT. In many cases, marketers may not even have
ownership of marketing technology decisions.
In short leading marketers are collaborating with IT to implement the technology framework that supports a system of engagement and are focused on issues that enable them to improve
the effectiveness and scale of their activities. The others are
struggling to coordinate effectively with IT and other functional areas within
the enterprise. They aren't at a point yet where ease of use or a lack of user skills could be a barrier.
This leads to the second question, “okay, how do
you collaborate more effectively with other functional areas (especially IT)?” This is complicated, but our data
suggests that Leading Marketers are able to collaborate effectively at least in
part because they’ve established credibility within the organization.
There are lots of ways to establish credibility, but a part
of it is being able to demonstrate the value that you bring to the table. To that end, our study found that 88% of
leading marketers attribute business results to marketing activities. They use a variety of different systems,
ranging from spreadsheets to complex software suites, but the common thread is
that they attribute results regardless of methodology.
And of that 88%, 93% of those leading marketers have a set
process in place for determining which marketing activity receives credit for
the business results. Again, the
specific methodology varies – first touch, last touch, results distributed
across multiple touches – but they have a set process in place.
This measurement allows leading marketers to invest resources intelligently.
They know what works and what doesn’t, and this allows them to maximize
the impact they have on the business and focus only on the most effective
activities. This in turn builds credibility with the rest of the enterprise. Marketers can finally speak in the same financial language as the rest of the business.
So in summary, it’s very difficult
to become a leading marketer without measuring the results of marketing
activities. Measurement not only informs
operational spending decisions, but also impacts the role of marketing within
the organization. Leading marketers’ ability to attribute results helps them
not only invest intelligently but also build credibility and the financial justification needed to construct an
enterprise-wide system of engagement.
I'll be back next time with a discussion of the overall characteristics of leading marketers and how they illustrate a road-map forward for marketing organizations. In the meantime, if you have any questions, please feel free to leave a comment!
IBM Center for Applied Insights
What is driving these shifts? In a January 28, 2012 New York Times Op-Ed piece Made
in the World
, Thomas Friedman argues, “Many CEOs, …increasingly see the world as a place where their products can be made anywhere through global supply chains (often assembled with nonunion-protected labor) and sold everywhere.” Globally integrated supply chains are transforming traditional business models and shifting yesterday’s outsourcing choices and trade-offs.
Mr. Friedman provides a provocative perspective. But, is this really happening?
The transfer of control of a process, product, or service to an external provider can take a variety of forms. The value in strategic outsourcing can include an organization’s ability to:
- Reduce costs
- Improve services delivery
- Engage in strategic partnerships that enable innovation, growth, and desired business outcomes
Traditional strategic outsourcing has often centered on transferring services to an external services provider with a focus on cost reduction. Outsourcing models are changing in new ways - why? What is driving these shifts and what can an organization do to capitalize on these changes?
Our team at the IBM Center for Applied Insights set out earlier this year to investigate market changes, identify emerging trends, and develop evidence-based research that explores how forward-thinking companies are responding to these trends.
Our premise is that the changing global dynamic, combined with technology-driven market shifts, is creating an opportunity for organizations to move beyond sourcing primarily for cost advantage to partnering for competitive advantage and desired business outcomes. Some of the technology-fueled market shifts reshaping the outsourcing landscape include:
- New and disruptive business models are changing how business is done
- Empowered consumers are driving companies to deliver customized client experiences to build enduring loyalty
- Big data generated from multiple sources is changing how organizations make decisions and leverage predictive insights for competitive advantage
Recently, IBM conducted a survey of 97 C-Suite Sourcing executives and found that seven out of ten plan to outsource for strategic reasons like driving growth and innovation. Based on their chief motivation, we categorized these organizations as:
- Cost-cutters–27 percent outsource their IT infrastructure to reduce operations costs
- Growth-seekers–37 percent outsource IT infrastructure, application management or business processes to achieve operational efficiencies and revenue growth
- Innovators–36 percent outsource multiple parts of the business to enable transformation and innovation
What we found most interesting was the progression of objectives across these three groups. Cost-cutters indicate they want one primary outcome from their sourcing relationships: cost savings. The majority of growth-seekers want to reduce costs, but also faster time to market for new products and services, and increased efficiency and effectiveness across the entire value chain. Innovators expect all of the above–and more. In addition to cost reduction, speed-to-market, and value chain efficiency, the majority of innovators want providers to help them:
- Drive front-office effectiveness (not just back-office)
- Better anticipate and respond to disruptive technological changes or market forces
- Proactively manage risk, compliance and security via technologies like predictive analytics
- Share risks and rewards based on business outcomes
I look forward to your comments and feedback!
Client Insights, Senior Consultant
Center for Applied Insights
Platform as a service (PaaS) is at a critical stage in its life cycle – with promising business benefits offset by lingering reservations. PaaS promises increased flexibility, lower costs and higher quality IT services, while maintaining control over data and applications. It sits squarely between infrastructure as a service and software as a service, and could prove to be the most transformational of the three main types of cloud computing.
The IBM Center for Applied Insights wanted to explore attitudes around PaaS in order to identify leading practices in PaaS adoption and provide recommendations on how to exploit its potential. We interviewed over 1,500 IT decision makers in 18 countries and a wide range of industries so we could better understand their motivations, experiences and concerns relating to PaaS. This week, we released the results of our exploration in our latest paper “Exploring the frontiers of cloud computing – Insights from platform as a service pioneers”.
The report goes into more detail on the benefits and challenges surrounding PaaS, how to overcome the challenges and what an enterprise can do to start, or continue, their PaaS journey. For a view from cloud pioneers CLD Partners, check out their post on IBM’s Thoughts on Cloud
blog. For more information about IBM’s SmartCloud Application Services launch and the study check out a recent article by ZDNet.
Consultant, IBM Center for Applied Insights
A couple of weeks ago I wrote a blog post discussing our
recent paper that links Leading Marketers with financial outperformance. In our study, these Leading Marketers had 40%
higher revenue growth and twice the
gross profit growth. Naturally, the next
question you’d ask is “how do I become a leading marketer?” And that’s exactly what I’m going to talk
about over my next few posts.
To kick things off, we found that Leading Marketers engage
with their customers across a variety of channels. These leading marketers are more likely to
have integrated inbound, outbound and offline marketing programs in some or all
channels. They are more likely to use
interaction optimization technology in all of their channels. And they are also more likely to adjust
offers in real-time across all channels.
In short, they create a “System of Engagement” that allows them to
engage each customer as an individual, across multiple channels.
So if leading marketers are creating a system of engagement
to deliver targeted messaging across channels, what specific tactics are they
using? To answer that, we looked closer
at mobile and social channels.
Essentially, a number of tactics within these channels can
be considered “table stakes.” Everybody
has a mobile version of their website and delivers mobile e-mails. Everybody has a social networking page on a
site like Facebook and most engage in micro-blogging (Twitter). But there are some specific, innovative
tactics where we saw differences between leading marketers and others.
When it comes to mobile, we found that leading marketers
were more likely to use mobile messaging campaigns, location based targeting,
and mobile-specific ads. For social,
leading marketers were more likely to develop apps for 3rd party
networking sites (Facebook), leverage social/local group buying (Groupon), and
participate in location-based games (Foursquare). All of this means that leading marketers are
faster to begin leveraging emerging/trending technologies to see if they can
enhance the system of engagement. Some
of these tactics may or may not prove to be effective in the long run, but the
leading marketers get there first… not unlike the adage “fail fast, fail
often”. By being at the forefront with
these tactics, they stand to benefit when they come across something that’s
It’s also interesting to note that location-based tactics
saw greater use by leading marketers in both mobile and social. When you think about a system of engagement
that strives to deliver targeted, personalized, relevant offers in real-time,
it makes perfect sense that location-data is a key component to enhancing that
There are a number of ideas you can take away from our data,
but there’s one over-riding principle that I think is worth taking to
heart: Innovation. Leading marketers aren’t afraid of trying out
new channel engagement technologies or tactics.
They get there first and they find out what works. They don’t worry about whether a channel is completely
mature… they jump in and get their hands dirty.
This enables them to be proactive with their customers, rather than
I’ll be back next time to talk about the barriers that
prevent many organizations from becoming Leading Marketers. As always, please feel free to reach out to
me with any questions. And, if you haven’t read it yet, take a look at our
executive report, How Leading Marketers Outperform: Effective Engagement and Intelligent Investment.
Client Insights, Senior Consultant
Center for Applied Insights
There has been a great deal of recent press stating that Platform-as-a-Service (PaaS) is “the future” of cloud. With a PaaS model, the user retains control of the application data, capabilities and updates, while the provider manages the software and infrastructure beneath that application. A lot has been made of the potential value of the technology – making the entire application lifecycle more efficient and less risky, while opening the doors for new organizational constructs and increased innovation and differentiation.
In its latest cloud hype cycle, Gartner placed PaaS at the summit, stating that it will be a transformational technology in the next two to five years. However, Gartner also said that PaaS is one of the most misunderstood aspects of cloud platforms. Adam Wiggins, one of the founders of cloud application platform provider Heroku, thinks that the PaaS market is just getting started. Finally Frost & Sullivan recently reported that “the platform-as-a-service market will be the next area of keen competition for cloud innovators, as the infrastructure- and software-as-a-service spaces have been commoditized.”
All of this may be true. A lot of enterprises are just getting started experimenting with and testing PaaS implementations, and it may take a number of years for widespread adoption. Technology adoption rates are always difficult to predict, but I think we can say with certainty that PaaS is a hot topic, with great potential, and much more will be written about it.
Consultant, IBM Center for Applied Insights
As a former marketer myself, I know that marketing is often marginalized within enterprises, particularly those with strong scientific or development organizations. Marketing is often viewed as being responsible for the “soft stuff” that looks pretty but doesn’t have any real impact on the business. I’m here to tell you that this view is wrong, and if you don’t realize it quickly, your competitors will.
We recently surveyed 362 marketers from around the world, across more than 15 industries, and found that Leading Marketers’ enterprises had 40% greater Revenue growth and twice the Gross Profit growth over the past 3 years when compared to the rest.
What exactly is a Leading Marketer? I’m glad you asked. We identified 2 essential traits of effective marketers: “Effective Engagement” and “Intelligent Investment”. Essentially we defined Leading Marketers as those who had a high level of responsibility for engaging with customers across channels as well as a sophisticated approach to investing marketing resources.
We then looked at publicly available financial data and found that when we correlated that to our segmentation of leading marketers, a clear trend emerged: Leading Marketers’ enterprises performed better financially.
So how, exactly, do you develop a Leading Marketing organization within your enterprise? Like most things in today’s world the answer is complex but grounded in the principles of Marketing 101. It can be as simple as the 4P’s or as complicated as developing a collaborative relationship with other functional areas within the enterprise. I’ll be blogging more about this topic and other insights from our study over the coming weeks, but get a sneak preview by reading our executive report, How Leading Marketers Outperform: Effective Engagement and Intelligent Investment.
If there is a particular topic you’d like me to talk about, please login and leave me a comment, below.