Happy 2003, everyone. I'll skip the typical prognostications for the year ahead; you've no doubt had your fill already and the uncertainties are way too numerous to even count. But we're certainly looking forward to working with all of you over the coming months and helping you make this a great year (hope springs eternal!). This E-ZINE highlights a few of the major issues we'll be addressing all year: solutions marketing and marketing with partners. We've also got a batch of upcoming events on these and other topics, so please read on and let us know what you think. As always, get back to me with any questions or suggestions about how we can make the E-ZINE a more valuable resource.

-Rob Leavitt, editor

What's Hot: Exploring the Requirements of Solutions Transformation: ITSMA's Solutions Roadmap

The transition from offering technology-based products and services to more business-oriented solutions involves overcoming an almost endless array of organizational obstacles, as so many IT firms are now discovering. Understanding the key aspects of the change, however, can help determine the most appropriate steps to take at any given stage.

ITSMA's Solutions Roadmap, a new tool based on extensive, industrywide research, outlines the major phases of the transformation and provides guidance on how to progress from one phase to the next.

The Roadmap includes four discrete phases (Figure 1):

• Starting point: The Push and Pull—in which companies are driven both internally and externally to adopt a solutions orientation.
• Skunkworks—in which companies experiment with special projects to prove solution viability.
• Building the foundation—in which companies undergo major structural changes to optimize and scale the solutions business.
• Solutions mastery—in which companies routinely go to market with integrated solutions that afford higher revenue and profit potential.

Figure 1: The Four Phases of Solutions Transformation

For each phase, the Roadmap reviews six critical elements of change:

• Organization
• Role of marketing
• Marketing activities (including strategy and market planning, solutions management, communications, and sales enablement)
• Offering development
• Sales
• Culture and behavior

For example, the overall role of marketing typically changes substantially as firms move toward solutions. In the "pre" phase, when companies are just beginning to consider the importance of solutions, marketing often focuses on discrete campaigns promoting different products and services. In the "skunkworks" phase, marketing begins to initiate or support pilot projects in solutions while largely continuing with more traditional product and/or services promotion. Moving further along, marketing takes on a more strategic role, with greater emphasis on opportunity analysis and segmentation, bringing together different business units, highlighting the business value the firm can bring to customers, and integrating with strategic partners.

The Roadmap is of course a relatively simple model. In the real world, companies proceed toward solutions in a rather less linear fashion and with a great deal more complexity. Given the importance of the topic to so many of our members, however, we're hopeful that the Roadmap can provide useful guidance in evaluating current challenges and exploring alternatives for the best way forward. In that context, we're anxious to hear your thoughts on the Roadmap. Please take a look and let me know what you think.

Is your team trying to master solutions marketing? What are the biggest challenges? Where does your organization land on the Roadmap?

—Julie Schwartz, jschwartz@itsma.com

Download the Roadmap: Planning Your Route to Solutions Mastery: ITSMA’s Solutions Roadmap, is available free to members with online access and for sale to nonmembers. For more information, visit http://www.itsma.com/research/abstracts/u0041.htm.

Research Desk

Making the Investment Case for Marketing with Partners

If strategic partners are so important, why aren't IT services organizations investing more marketing dollars to help them succeed? ITSMA members attribute an average of 17% of services revenue to partner relationships, according to a recent survey, and almost all expect that figure to grow in the next two years. A whopping 84% of survey respondents stated that partnerships and alliances have become more important in the past year, with most of those saying "significantly more important." Yet only a handful dedicate even 10% of their services marketing budgets to marketing with partners. A majority dedicate less than 5%.

The growing emphasis on partners and alliances is easy to understand: Services organizations are trying to deliver more complete solutions to their clients, and they need partners to round out capabilities and offers. Expanding sales coverage across new regions and new industries is similarly critical these days.

Bringing such partner-enabled solutions to market, however, is proving quite difficult. Collaborative activities are plentiful. Most firms are engaged in joint sales calls with partners, joint collateral, and shared events. Many have developed collaborative Websites. Joint advertising is common. But the programs are not all coming together. On average, survey respondents reported that less than half of their existing alliances were successful. Common problems include lack of alignment on goals and responsibilities, lack of executive commitment, competition over owning the customer, and difficulties in communicating joint value propositions.

One hesitates to say that simply throwing more money at partnerships is the key to success. Sending good money after bad is not something any of us can afford. But successful alliances do cost money. Consider just a few of the best practices in collaborative marketing, as noted by ITSMA members:

• Dedicate alliance marketing managers to each strategic relationship with specified budgets, resources, and measurable objectives.
• Build alignment and trust with partners through active field-level programs.
• Develop systems and tools for cross-partner knowledge sharing and retention.
• Regularly evaluate alliance performance across a range of financial, satisfaction, and program development metrics.
• Maintain incentive schemes with desirable rewards for alliance success.

Increased marketing investment will not guarantee success with strategic partners and alliances. But it's awfully hard to imagine succeeding without sufficient funds to build the systems and tools required to at least create the proper foundation.

Are you investing enough in marketing with partners? What's working best for your organization in collaborative marketing?

—Rob Leavitt

ITSMA's new briefing presentation, Making Collaboration Work: Best Practices in Marketing with Partners, provides more detail on ITSMA's member survey findings and on recommended best practices in collaborative marketing. The presentation is available free to ITSMA members and for sale to nonmembers. For more information, visit http://www.itsma.com/research/abstracts/OLB121702.htm.

Telecom Service Providers Rate Lucent, Nortel, and Cisco Highest in Network Services

The leading equipment manufacturers for the telecom service provider market—Lucent, Nortel, and Cisco—hold a substantial lead in brand awareness and preference for delivering networking services, according to a forthcoming ITSMA report, but the numbers are low enough to suggest that the market remains wide open. Interviews with 300 decision makers from large telecom carriers, voice and data network providers, and wireless and broadband companies suggest that none of the major networking services organizations holds a dominant position and few buyers have a strong preference for any of the large players.

The ITSMA study addressed two categories of services: networking rollout and support services, and network professional services. In both categories, survey respondents named Lucent, Nortel, and Cisco most often when asked if they could list any companies providing such services. Many prominent networking companies were cited by only a few respondents. More than one-quarter of all respondents could not think of a single firm that provides networking rollout and support services, and more than 40% could not name any firms providing network professional services.

ITSMA also asked respondents to name the one firm they would most likely call if they needed network services in either of the two categories. Again, Lucent, Nortel, and Cisco were the most frequent answers, but none of them received even 5% of the responses. Most respondents cited "don't know," demonstrating that no company owns a significant chunk of customer mindshare.

As important, overall impressions of most of the firms' services capabilities were not great. ITSMA asked survey respondents for their impressions of 15 network services organizations. The highest rated were Cisco and Juniper, while most firms were clustered around a score of 3 on a 1-5 favorability scale. Similarly, respondents suggested significant performance gaps in the areas they considered most important, such as providing good value for the price and guaranteeing service levels.

Not surprisingly, given how hard their industry has been hit by the economic downturn, telecom service providers are in an extremely cautious mood when it comes to purchasing additional services from outside firms. Their top business priorities, according to the ITSMA survey, are basic growth and profitability. They are not looking to implement the latest technologies or even speed time to market with new offers unless those can be tied directly to revenue, profit, and customer loyalty.

The market remains quite large, however, which explains why so many IT services firms continue to contend for market share. In trying to improve their position, networking services marketers would do well to focus both on building brand awareness and shaping their messages around the basic growth and value issues that buyers emphasize most.

—Adnelly Reyes, areyes@itsma.com

ITSMA's forthcoming report, Network Services Competitive Positioning and Brand Awareness Study: Service Provider Market, 2002, includes detailed data and analysis on buyer perceptions of leading network services providers based on a survey of 300 decision makers from the service provider and telecom carrier market. The report covers unaided and aided awareness, familiarity and favorability, relative market positioning, preferred company attributes, and network service buyers' goals and priorities. The report will be available for sale at member and nonmember prices on February 1, 2003. For more information, visit http://www.itsma.com/Research/abstracts/bnw002.htm.

Tech Poll: CIOs Looking to New Initiatives in 2003

The CIO Magazine Tech Poll provides a monthly assessment of technology buying trends from a broad cross-section of chief information officers (CIOs), mostly from North America. The latest survey, conducted December 5-12, 2002, shows continued hopes for modest increases in IT spending for 2003. The December survey's key findings include:

• CIOs plan to increase overall IT spending 4.6% over the next 12 months, down slightly compared with a 5.1% projection in November but still significantly improved over a slight decline in 2002.
• When asked about their key 2003 spending initiative, about 70% of the panelists cited new hardware and/or software initiatives, compared with only about 26% citing maintenance of existing hardware and/or software.
• The outlook for computer hardware spending improved over November projections, with 45.6% of the panelists planning to spend more on hardware versus 39.3% in November. Those planning to reduce hardware spending fell to 18.1% in December from 21.6% in November.
• About one-third of panelists (33.5%) plan to increase spending on outsourced IT services, the highest number since March 2002. More than one-quarter of panelists (27%) plan to decrease such spending, however, while 37.3% have no plans to change their spending levels.

December Tech Poll figures were based on 335 survey responses, with 94.3% from North America. CIOs made up 89% of the total respondents. The respondents represent a wide range of industries, including technology services, manufacturing, finance, state and local government, healthcare, and wholesale and retail distribution.

For complete survey results, visit http://www.cio.com/info/releases/12techpoll_results.html.

Call for Sponsors: Outsourcing and Managed Services Competitive Positioning Study

Mega-marketing initiatives to promote e-business on demand and utility computing represent the latest wave in IT outsourcing, but the prospects for the leading providers of outsourcing and managed services remain unclear. Certainly the providers offer clients many compelling promises: reduced and more controllable costs, improved performance, increased flexibility, and greater access to expert skills and new technology. But how do prospective buyers view these offers? Which firms do they perceive as credible? By what criteria are they evaluating potential partners? Which firms hold the strongest competitive positions in different managed services categories?

ITSMA's upcoming Outsourcing and Managed Services Competitive Positioning Study will answer these questions by going to the source: decision makers at Fortune 1000 companies. The study will provide study sponsors with a map of the competitive landscape and a report on the impact of their marketing and sales positioning—all from the customer's point of view. As with all ITSMA multiclient studies, sponsors will have the ability to help shape the research guide, add private questions to the customer interviews, and obtain customized briefings of the results.

For more information, visit http://www.itsma.com/research/prospectus/mk0317_ms02.htm.

EuroNotes: ITSMA Europe Outlines Events Calendar for 2003

ITSMA Europe kicks off its 2003 events programme on February 6 with an online briefing exploring European services marketing priorities for the coming year. Last year saw relationship marketing programmes come to the fore as companies attempted to increase the loyalty of existing clients and expand their share of those clients' IT services spending. This trend should continue in 2003, and the February briefing will discuss the extent to which marketers will redirect resources toward these client-centric programmes.

Another clear priority for marketers this year is using business issues to raise demand for services and solutions. ITSMA Europe's second online briefing, on April 29, highlights the importance of thought leadership marketing initiatives, particularly to reach board-level decision makers and influencers.

Other online briefings on the schedule for 2003 will explore buying priorities for IT services and solutions in Europe (September 4) and marketing’s role in business development (December 2).

ITSMA Europe's Annual Forum and Workshop, to be held on June 16-17 in Paris, will focus on adapting to the world of solutions. The programme will include discussions of a roadmap for making the transition from discrete products and services to integrated solutions, as well as best-practice examples from a number of leading European and global companies.

On the training side, ITSMA will offer its successful workshop "Managing Brands and Reputations" on April 7-8 in Dublin and the industry-leading Client-Centric Marketing Course on November 17-19 in the United Kingdom. Both events provide hands-on learning oriented to the most urgent business and market challenges facing services marketers today.

Finally, ITSMA Europe will continue its series of "Inner Circle" dinners for members in London with dinners scheduled in March and September. These intimate gatherings for marketing executives from member companies provide rare opportunities for focused but informal peer discussion on key marketing topics of the day.

All in all, the 2003 events programme should have something for everyone in services marketing! Take a look at the whole calendar and don't hesitate to let me know if you have any questions. I'm looking forward to seeing you soon.

—Bev Burgess, info@itsma.com

Download the complete ITSMA Europe 2003 Calendar

More EuroNotes

Upcoming Events

February 4 Online Briefing: Marketing's New Fundamentals: 2003 Annual State of the Profession Address (free to members)

After two years on the hot seat, marketers are defining a new set of fundamentals for success in a slow-growth economy. Join ITSMA's Dave Munn, president and CEO, and Julie Schwartz, vice president of research, for their annual review of the most important trends in services marketing, the latest data on marketing budgets and programs, and the top priorities for success.

For more information or to register online, visit http://www.itsma.com/Events/event_desc/03OB01N01.htm or contact Carolyn Jefferson at +1-781-862-8500, ext. 21, or cjefferson@itsma.com.

February 6 Online Briefing: Marketing Priorities in Europe: 2003 Annual European Update (free to ITSMA Europe members)

After a year of difficult adjustments in response to increasingly skeptical buyers, marketers of technology services in Europe are looking to improve performance in 2003. Join Bev Burgess, ITSMA Europe’s director of professional services, for this annual review of the key challenges European marketers are facing in 2003.

For more information or to register online, visit http://www.itsma.com/events/event_desc/03OB02E01.htm or contact ITSMA Europe at +44 (0) 1892 523060 or info@itsma.com.

February 25 Breakfast Briefing: Solutions Marketing in a Slow-Growth Economy (free to members; Newton, MA)

Organizing marketing around solutions can require substantial changes in strategies, tactics, roles, and responsibilities. Join ITSMA President and CEO Dave Munn and Vice President Steve Hurley for a presentation on ITSMA's Solutions Roadmap, a detailed model of the four phases that IT firms pass through to achieve solutions mastery.

For more information or to register online, visit http://www.itsma.com/Events/event_desc/03BB02N02.htm or contact Carolyn Jefferson at +1-781-862-8500, ext. 21, or cjefferson@itsma.com.

March 12-13 Workshop: Creating Market-Focused Growth, with Dr. Lynn Phillips (San Francisco)

Generating profitable growth in today's brutally competitive markets requires crafting value propositions that speak directly to client challenges and needs—and doing that better than your competitors. ITSMA's workshop provides marketers with a powerful, hands-on immersion in the practicalities of developing superior value propositions and communicating them more effectively internally and externally.

For more information or to register online, visit http://www.itsma.com/events/event_desc/03WS03N03.htm or contact Lore Griffith at +1-781-862-8500, ext. 19, or lgriffith@itsma.com.

March 19 Online Briefing: Developing and Marketing New Solutions: Organizing Marketing Around Value-Driven Solutions (free to members)

The push to emphasize integrated solutions over point products and services raises numerous questions for marketers. Join Steve Hurley, ITSMA's vice president of learning and performance excellence, for a review of ITSMA's latest research on how companies are responding to the solutions marketing challenge.

For more information or to register online, visit http://www.itsma.com/Events/event_desc/03OB03N04.htm or contact Carolyn Jefferson at +1-781-862-8500, ext. 21, or cjefferson@itsma.com.

Check out other upcoming ITSMA events: Download the ITSMA 2003 events calendar.
http://www.itsma.com/aspfiles/Events/calendar.asp

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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.