Over the last few years, buyers have found that IT vendors are aggressive, arrogant, ignorant and over-promising. That was the clear picture presented by a large survey of IT buyers and CIOs I worked on. The research surveyed over 250 UK executives with IT responsibility in £50m+ businesses (half were at least ten times that size). Only 27% found IT vendors’ sales and marketing efforts to be innovative and professional. That’s a major lost opportunity for the industry, since 38% of firms reported increasing technology budgets. Only 16% expected less. It’s fair to say that IT has lost trust in vendors to quite some degree, and that in term is making many IT departments more cautious and less able to drive innovation.
The major disconnection between customers and suppliers discovered by the CIO and IT buyer survey is that while IT vendors tend to define themselves by their technology, those ‘better mousetraps’ don’t speak directly to their clients’ needs and business demands.
Many vendors seem to have a non-specific understanding that senior executives outside IT have a growing impact on sales. However, that realisation doesn’t mean they know who those influencers are, beyond a vague idea that it’s the C-suite.
Roger Alderson, formerly a global marketing leader at EDS, HP and Logica, has spoken to me five hurdles for vendors: understanding their market; identifying the co-decision-makers; discovering their criteria for buying; selling the value of the solution; and delivering in a way that builds up on-going customer engagement.
PAC’s UK managing director, Jean-Christophe Bodhuin, relates this to how major ICT vendors go to market. IT firms are challenged to develop business concepts that related more to client needs than to technology trends, like Cloud.
While vendors are looking ahead, often discussing sales enablement, the issue of selling through the channel, or the role of master managed service providers, IT departments are lagging behind. What the chart above shows is how deeply IT is already sharing the IT budget. Very soon, I think we’ll see the situation where an even larger slice of the IT budget is being spent outside IT, without IT even knowing about it.
Far from being the ally of IT in its struggle to control the IT budget, many analyst firms are helping marginalise IT by focussing on information that meets the needs of business managers. Forrester Research stands out as a firm which, through a role-based approach, is reducing the information asymmetry which means IT was holding all the cards. Indeed, the way in which both business leaders and, through BYOD, other professionals are using cloud and personal technologies is probably driving more business innovation than IT departments in many firms.
To turn the situation around, and allow businesses to really tap into the improved decision-making that comes from involving IT, vendors and IT need to align their discussions to how IT users can drive more value to their organisations’ customers. Analysts’ research and other services could be a major part of that. The analyst firms that learn how to deliver the most value cannot only secure their own future: they can also secure their clients’ futures too. A big part of that is explained by our Analyst Value Survey. But the biggest step is admitting that this problem exists, and that analysts are one of the few forces that can help solve it.