We lead this month with Fujitsu's push toward global leadership in IT services, an ambitious effort that could herald a formidable new competitor across many services markets. We've also got some good news on the market forecasting front, a new report on IBM's strategic planning process, fresh data on marketing metrics, and lots of upcoming events in the U.S. and Europe. And get ready for the 2002 Services Marketing Excellence Awards; the race for recognition can now begin!

—Rob Leavitt, editor and ITSMA's director of member advocacy

What's Hot:Fujitsu Puts Global Services Front and Center

Technology giant Fujitsu has taken several decisive steps in recent months to build its global services business, including a revised corporate strategy, reorganization of subsidiary services units, and an ambitious global branding campaign. The moves represent a powerful effort to challenge IT services leaders on a worldwide basis. Fujitsu is already the world's third largest provider of IT services, but the vast majority of its services business is in Japan. Outside Japan, the company has relied on a number of separate services organizations, many of which (until this month) have not even operated under the Fujitsu brand.

The new corporate strategy puts a much stronger emphasis on services and solutions. Fujitsu has recently closed and consolidated a number of product facilities and businesses and placed a much stronger priority on wrapping value-added services around its products. An expanded range of services offerings for systems development and operational services, along with a major new alliance with Accenture in Japan, should enable a richer mix of solutions for the largest corporate clients. A corporate shift to a handful of large business groups is designed to increase links across the company. Fujitsu also slashed the size of its corporate board of directors and assigned wider authority to a new, small group of executives to help speed decision making.

To further strengthen its global push into services, on April 1, 2002, Fujitsu launched Fujitsu Consulting and Fujitsu Services, two new international services units based on the former DMR Consulting, ICL, and several other Fujitsu organizations. (See "EuroNotes" below for more on Fujitsu Services and ICL.) The new units will operate much more closely with each other and with the new software and services business group in Japan to attract the largest global accounts. This work will include much more aggressive and more collaborative marketing and sales efforts in the United States and in large markets in Europe and Asia/Pacific. One especially intriguing opportunity for the new units is tapping Fujitsu connections in Japan to solicit global services business from Japanese multinationals.

With the formal establishment of Fujitsu Consulting and Fujitsu Services earlier this month, the company kicked off a new phase in advertising and brand awareness activities focused especially on services. Fujitsu had already launched a major global brand campaign in 2000, committing to spend as much as $500 million over the next three years building a single image and message for all Fujitsu units. The new phase highlights print and online promotion of the new services units, redesigned Web sites highlighting services and solutions, and extensive outreach to clients, prospects, and market influencers. Cross-promotion of broader services capabilities to existing DMR Consulting, ICL, and "old" Fujitsu clients is a particularly important focus.

The logic behind Fujitsu's efforts is certainly compelling:

• Build a more integrated company to enable comprehensive, global solutions for the largest clients.
• Strengthen the brand to build awareness and get on more short lists.
• Mine existing clients for new opportunities.
• Dig deeper into corporate resources to compete more strenuously with the biggest IT services players.

Notwithstanding the current economy and its own recent struggles with profitability, Fujitsu services leaders are right to see enormous opportunities in the currently fragmented global market. Making all the new pieces fit together will surely take time. But the strategy makes sense, and recent moves could well become important steps toward building a new global services powerhouse.

E-mail us your thoughts on Fujitsu's global services push. Do you think the firm pull it off? What are Fujitsu's biggest challenges?

—Rob Leavitt

Research Desk

IBM's Continuous Strategic Evolution: Constant Planning for Rapid Innovation (New ITSMA Case Study)

In 1996, Louis Gerstner, then president and CEO of IBM, set his sights on radically revamping the company's existing strategic planning activities to support a more nimble approach to new challenges and opportunities. At that time, IBM's strategy program resembled those of most corporations: an unwieldy annual cycle that mostly pulled together wish lists from different internal organizations.

In overhauling the program over the next several years, IBM's executives and marketing leaders concentrated on five critical objectives:

• Design a strategic issues review process that focuses outwardly on economic and technology issues rather than on internal organizational concerns.
• Ensure that strategic planners focus directly on the critical implications, risks, and tradeoffs inherent in strategic alternatives.
• Structure an ongoing process to keep top executives focused regularly on fundamental strategic challenges and opportunities and not just on operational issues.
• Connect strategic planning directly to resource allocation decisions, thereby keeping implementation at the center of the planning process.
• Promote widespread support and involvement in the entire process.

Today, strategic planning at IBM looks quite different than it did in the late 1990s. A continuous strategic planning process involves ongoing review of major issues from all major divisions (including Global Services) and executive decision making on a twice-monthly basis. "Deep-dive" research initiatives enable the firm to fully explore a new challenge or opportunity, develop a strategy, and allocate resources within 30-90 days. With economic (and political) upheaval, technical innovation, and competitive initiatives happening rather more frequently than annual strategic reviews, IBM's continuous strategy evolution enables the firm to act and react more quickly than most to critical market challenges and opportunities.

Read the complete text: IBM's Continuous Strategic Evolution is a membership deliverable. It is available free to all ITSMA members and for sale to nonmembers via the ITSMA Web site. For more information or to download or purchase this report, visit http://www.itsma.com/research/abstracts/cs0002.htm.

TechPoll: CIO Spending Expectations Hit 12 Month High

ITSMA has arranged with CIO Magazine to include highlights of the CIO Magazine TechPoll in the ITSMA E-ZINE. This monthly survey provides an assessment of technology growth trends from a broad cross-section of CIOs, mostly from North America. The latest survey, conducted from March 14-21, 2002, suggests that chief information officers have recently become much more optimistic about the projected growth of IT spending over the next year.

• During March 2002, the CIO Magazine TechPoll projected that IT budgets will grow 7.7% over the next 12 months, up substantially from February's projection of 3.2%—and its highest level since March 2001.

• More than 90% of panelists reported having an application backlog, up from 87% in December 2001; 57% said the backlog was significant (up from 52% in December). Of those reporting a significant backlog, however, the majority noted that budget constraints remained more important.

• Security software continued to be the strongest sector, with nearly 55% of panelists expecting to increase spending and only 4% planning to decrease spending.

• Panelists said that they expect to spend 16% of their IT budgets on developing business over the Internet during the next 12 months, with more than a third of panelists planning to increase spending on e-business software versus only 15% planning to cut back.

For more information, visit: http://www.cio.com/online/040102_techpoll.html.

DataFile: Measuring the Value of Marketing (Member Survey Results)

Last month, ITSMA surveyed member companies to assess the state of the art in measuring the value of marketing. We were most interested in learning what is being measured, how marketers are communicating results—and to whom—and what marketers see as their critical measurement challenges. Key findings include the following:

• More than one-third of respondents reported a new emphasis from senior executives on holding marketing accountable for return on marketing investment.
• Financial metrics are still king. Almost two-thirds of the survey participants believed that financial performance is the most important category for evaluating services marketing, compared with 13% who cited business development metrics, and less than 10% who cited other metrics such as internal processes, brand and image, or customer satisfaction.
• At least three-quarters of respondents said that they are systematically tracking such financial metrics as services revenue, services gross margins, revenue growth rates by services offering or product line, and overall services operating margins. But only about half said that they are systematically tracking the cost of services sales, and less than half are tracking return on marketing investment.
• Only 28% of respondents said that they are using a balanced-scorecard methodology to measure marketing performance, although 30% are planning to implement such an approach.
• Overall, a strong majority of respondents (60%) said that they believe they are not doing a good job of measuring marketing return on investment (ROI), with only 14% stating that they are doing well or extremely well.

Communicating marketing's results to corporate executives also remains rather undeveloped, with only about half of respondents having regular meetings and fewer than half providing either a dashboard tool or formal reports, as shown in the following.

A presentation of the complete findings is available to all ITSMA members who participate in the survey. Members interested in participating and receiving the full data set should contact Adnelly Reyes at +1-781-862-8500, ext. 14, or areyes@itsma.com.

On March 19, 2002, Steve Hurley, ITSMA, presented a best practice strategy for designing and packaging marketing metrics. Steve's briefing slides are now available to ITSMA members with online access passwords or for purchase. For more information visit http://www.itsma.com/research/abstracts/olb031902.htm.

Infosys Partners with Wharton for Global Awards Program

Top consulting firms have long partnered with elite universities and think tanks to build intellectual capital and gain visibility and credibility by association, but technology firms have only recently begun to adopt the same strategy. A new initiative from Infosys Technologies highlights the potential payoff.

Next month, the William and Phyllis Mack Center for Technological Innovation at the Wharton School of the University of Pennsylvania and Infosys Technologies will jointly present the first Wharton Infosys Business Transformation Award. The program, a well-designed effort to help connect Infosys to the concept of business transformation, complements earlier Infosys initiatives to link up with other thought leadership organizations such as The Economist. The Wharton School is, of course, a highly respected institution, and the two partners have assembled an impressive global jury for the award, including leaders from industry, finance, and other sectors.

As a marketing initiative, the program should yield substantial benefits for Infosys: a high-profile partnership with a leading business school, new contacts with industry leaders (among both award participants and jurors), thought leadership material for Web and other promotion, media coverage, and so on.

But the value goes beyond marketing, according to Infosys brand manager Jessie Paul: "The advantage of associating with leaders in their respective fields is that the result of the combination is always greater than the sum of the individual elements. So we are able to learn a great deal from this process while also sharing ideas with the community at large."

Investing in thought leadership and academic partnerships might seem an unaffordable luxury while marketers are still struggling to fund basic sales support activities. But when clients and prospects put industry expertise and knowledge sharing at the top of their lists when evaluating services firms, as ITSMA research demonstrates again and again, such investments can be viewed as rather more essential.

—Rob Leavitt

Applications for the Wharton Infosys Business Transformation Award will be accepted through April 15, 2002. For more information, visit http://www.infy.com/wibta.

2002 Brand Awareness and Market Positioning Studies: CRM, Network/Telecom, Storage, and Security—Sign Up Now!

Four new ITSMA multiclient studies are now open for sponsorship participation. Study sponsors are able to influence the research design as well as obtain customized reports and briefings. For more information or to sign up as a sponsor, view the detailed study prospectuses on the ITSMA Web site:

• Customer Relationship Management (CRM) Solutions:
  http://www.itsma.com/research/prospectus/mk0281_crm02.htm
• Network and Telecom Services—Service Provider Market:
  http://www.itsma.com/research/prospectus/mk0276_nwt02.htm
• Storage Solutions:
  http://www.itsma.com/research/prospectus/mk0282_strg02.htm
• Security Solutions:
  http://www.itsma.com/research/prospectus/mk0286_sec02.htm

2002 Services Marketing Excellence Awards

Show us your best! Standout performance deserves recognition, and ITSMA's Services Marketing Excellence Awards have recognized special achievement in marketing since 1998. So sharpen your pencils, dig out the data on your star programs, and apply now!

Categories for the 2002 awards include:

• New Services Development
• Brand and Reputation Management
• Customer Loyalty and Retention
• Solutions Marketing Programs
• Increasing Sales Effectiveness

Awards will be given to the programs in each category that best represent innovation and measurable results.

Applications are due June 30, 2002. ITSMA will notify winners in September 2002 and present the awards during our annual MarketingServices/2002 Conference on October 14-16 in Atlanta.

For more information, participation guidelines, and application forms, visit http://www.itsma.com/press/sme.htm.

EuroNotes: Fujitsu Services Pushes for European Leadership

The launch of Fujitsu Services in Europe on 1 April 2002 means the end of the well-known IT services brand ICL—and perhaps the end of an era, given that ICL's origins as the United Kingdom's national IT leader go back to the emergence of the computing industry in the late 1940s. But it may also mark the beginning of something potentially much bigger.

On the surface, Fujitsu Services simply represents a renamed ICL. The "new" firm is still based in London, still focused on IT management and integration for large enterprises, and still much stronger in the United Kingdom than in the rest of Europe. Dig a little deeper, however, and the story becomes more interesting.

Publicly, the launch includes many of the typical elements of a major branding or re-branding campaign. In the longer run, though, several behind-the-scenes initiatives that have paralleled the branding campaign could provide the firm with a more significant boost.

Read the full story

Note: ITSMA will publish an in-depth case study on the creation, strategy, and branding of Fujitsu Services later this spring.

Upcoming Events: North America

May 9 Online Briefing—From Infoglut to Intelligence: Structuring Research for Business Results (free to members)—11:00-12:00 EDT
With endless possibilities but limited budgets, getting the right information at the right time to support business-critical decisions is a daunting task. But there are practical steps that marketers can take to ensure that research initiatives at almost any level contribute more effectively to business results. Join Rob Leavitt, ITSMA's director of member advocacy, and Mary Redford, partner at Business Visions, Inc., for a discussion of current challenges, best-practice examples, and practical recommendations to increase the effectiveness of your research activities.

For more information or to register online, visit http://www.itsma.com/Events/event_desc/E05090200.htm or contact Lore Griffith at +1-781-862-8500, ext. 19, or lgriffith@itsma.com.

June 11-14 Client-Centric Marketing Course—Accelerating Services Growth (San Francisco)
The next edition of ITSMA's signature services marketing course provides an intensive, hands-on learning experience based on the four key phases of the ITSMA Marketing Framework: strategy and planning, solutions management, communication, and relationship management. The course is led by Steve Hurley, ITSMA's vice president of learning and performance excellence, and Philip Dover, faculty director for Babson College's School of Executive Education.

For more information or to register online, visit http://www.itsma.com/Events/event_desc/E06110200.htm or contact Lore Griffith at +1-781-862-8500, ext. 19, or lgriffith@itsma.com.

Upcoming Events: Europe

April 22-23 Workshop—Managing Brands and Building Reputations (Beaconsfield, U.K.)
Strong brands have never been more important or more vulnerable than in today's era of transparency and hypercompetition. Managing Brands and Building Reputations highlights practical knowledge and techniques to launch and relaunch services brands, embed the brand in company values and actions, and evaluate brand strengths and weaknesses.

For more information or to register online, visit http://www.itsma.com/Events/event_desc/E04220200.htm or contact ITSMA Europe at +44 (0) 1494 616027 or info@itsma.com.

May 28 Online Briefing—Reputation Management: Walking the Talk (free to European members)—15:00-16:00 GMT
For a services marketing organisation, creating a consistent brand identity is only Step One in ensuring the firm's reputations. The more difficult challenge is ensuring that the brand concept is reinforced at each customer touch point. Join ITSMA Europe's Beverley Burgess, professional services director, and Terry Hannington, managing director, for a discussion of how services marketers can ensure that the entire organisation is truly "walking the talk."

For more information or to register online, visit http://www.itsma.com/Events/event_desc/E05280200.htm or contact ITSMA Europe at +44 (0) 1494 616027 or info@itsma.com.

June 24-25 Annual Forum and Workshop—From the Eye of the Storm: Marketing's Role in Accelerating the Turnaround (London)
With the European technology sector about to go through a period of realignment and consolidation, business and marketing leaders are focussed on driving enhanced results with fewer resources. Amid continued economic uncertainty, ITSMA's 2002 European Forum will bring together business and marketing executives from leading technology, telecom, and IT consulting firms to explore such critical issues as managing reorganization, assessing and increasing brand value, strengthening response-generation programs, and measuring the value of marketing activities.

For more information or to register online, visit http://www.itsma.com/Events/event_desc/e06240200.htm or contact ITSMA Europe at +44 (0) 1494 616027 or info@itsma.com.

Complete 2002 Events Calendar: http://www.itsma.com/aspfiles/Events/calendar.asp

Business and Community: CitySkills Connects Business with Inner-City Talent

For the last several years, ITSMA has supported CitySkills, Inc., a Boston-based nonprofit that helps inner-city job IT training programs create more effective curricula to meet industry needs. The idea is to create a social and economic win-win situation by connecting businesses that need skilled IT personnel with urban job-training programs trying to help inner-city adults gain access to well-paying, upwardly mobile jobs.

To help bridge the gap between employers and urban talent, CitySkills' Pipeline Project is creating a network of companies, trainers, and support organizations (e.g., child care and transportation) to strengthen the pipeline that recruits, trains, and places urban adults into entry-level IT jobs such as database administration, network management, and Web design.

Too often, notes CitySkills executive director Farron Levy, "There is a disconnect between job-training programs and the employers. The trainers focus on skills that just don't match what businesses really need." But when appropriately focused, says Levy, these training programs can deliver significant value to industry. "In addition to providing cost-effective, custom-trained labor, these programs can help companies promote diversity and engage the community in meaningful ways."

CitySkills is now recruiting Boston-area firms and offices for a needs assessment project to help determine the specific skills that IT training centers should emphasize. If you are interested in participating in the project, which is led by a pro bono team from Accenture and MIT's Sloan School of Business, or can suggest other contacts, please let me know. We'd love to get more ITSMA members involved.

—Rob Leavitt

For more information, visit: http://www.cityskills.org

Do you have a services marketing question?
Visit Ask ITSMA to access our experience, insight, and research results.

(c) Copyright 2002, ITSMA

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About ITSMA
ITSMA specializes in helping companies market and sell services and solutions more effectively. As a membership organization, we provide research, consulting, and training to the world's leading technology, communications, and professional services providers to generate increased demand, strengthen customer relationships, and improve brand differentiation. ITSMA is based near Boston, and has offices in London and Tokyo. Learn more at www.itsma.com.