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| Cambashi press release |
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SNAKE OIL, MOUSETRAPS & HOMING PIGEONS CBS.017
Mike Evans gave a highly entertaining summary of the day, and an astute vision of the current situation in the market for IT in industry. "Industrial computer technology hits the market in waves," he said. "From computing based on data centres in the 1960s, we have seen departmental computing give way to desktop technology." Mr Evans believes that the market is currently in a transitional period between desktop and network-centred computing. This coincides with a period where users are becoming far more sophisticated - often their knowledge in many areas is as great as or greater than that of vendors' sales staff. Snakeoil - smooth talk that assumes that the sales rep has the superior knowledge - simply will not do any more. There is also an increasing demand for best-of-breed applications in preference for seamless integration, which can compromise functionality. Year 2000 issues and the introduction of the Euro present a double whammy. They are currently taking up about 10% of companies' IT budgets. But what will happen to this money in future? ERP is the acronym on everyone's lips, but new applications are likely to become equally critical. In future, departmental managers will have to justify all capital investments. Competition will not just be from alternative IT products, but from elsewhere - buildings, new company cars, plant and machinery will all vie for a share of the corporate cake. He warned that too much sales literature is entirely product oriented, claiming that the products were "better" than other similar products. The real issues are implementation and the sustainability of the solution. Vendors must be prepared with the right marketing message to confront this new challenge: "laser" or "paintball" marketing must be confined to the past. The successful vendor will in future be the "homing pigeon", identifying customers' unique requirements and creating a specific marketing message in response to these. "It may be best in future to emphasise changes in business practices and the role of the supplier as a facilitator, working in partnership with the customer to create and maintain an overall IT environment that improves the performance of the business," he said. "Users," he continued, "have three main options for IT implementation: change management through consultants and systems integrators; productivity improvements through VARS; or personal productivity through cheap, over-the-counter purchases." He likened systems integrators to cruise ships: sedate and expensive (and they have good lunches). There are not many good systems integrators, but their great strength is in their ability to supply services beyond the products, and at ensuring the longevity of systems. On the other hand, there are something like 3000 VARs in Europe - but many of these are little more than product shippers. Although they are supposed to add value to the products they sell, many of them simply sell at discounted prices, and add no value whatsoever. The best VARS supply training and service at minimum. Anyone who buys cheap does not have a leg to stand on if product performance does not meet expectations. Mr Evans suggested that OEMs should protect themselves by establishing brand values for new and emerging applications. The North American market is already changing fast, and Europe will soon follow. Vendors need to be prepared with new marketing messages. They need to be aware of issues such as who has the right sales and marketing skills, whether it is possible to retrain, what the metrics are for the new business model, and what will drive users' buying decisions. And where is technology taking us? ERP and PDM are converging fast - informed opinion has it that SAP will buy a CAD company before long. Gartner Group talks about the emergence of "PDMII", but Cambashi believes that this view is a compromise resulting from an internal power struggle. Mr Evans maintains that users want vendors to provide products that improve business models and processes. Cambashi's money is on ORP, and Mike Evans' advice to vendors is "look at how the market is changing, who the future decision makers will be and how to reach them. Then plan for an innovative sales pigeon." |
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