Will Boomi’s strategy succeed with new management?

It is always hit or miss whether a blog post will solicit dialogue from readers. TBR’s recent blog post Who is going to want Boomi? certainly struck a chord. The blog focused on the actions of the private equity firms intending to acquire Boomi, which ultimately led Boomi to provide TBR with deeper insight into its most recent achievements, activities and aspirations as the company moves to new corporate ownership. Boomi has a sound growth strategy with a high chance of success, assuming the company and its new owners are in strategic alignment.

Evaluating the business using an inside-out/outside-in construct provides a reasonable framework for the market implications Boomi ― and really any integration PaaS (iPaaS) vendor ― will face in the years ahead. The situation starts with a universal fact: Digital businesses gain a competitive advantage against peers if they automate the flow of data across their organization. Any step where a business has to add labor when a peer does not is a cost disadvantage. In this respect, Boomi’s value is twofold: 1) automations can be built into the process and tightly integrated so that they don’t break as applications evolve, and 2) organizations can create even greater advantage when they are discovering data from all of their sources and understand the data and applications involved in the automation process.

Figure 1

Outside in: The rise of data management and asymmetric competition

Our initial blog on the sale of Boomi referenced UiPath and startups Kong and Entefy as potential asymmetric challengers to Boomi’s core value proposition. Additionally, you have the basic PaaS offerings from the exascale cloud platforms providing prebuilt connectors and myriad additional services for security, data protection and data management. SaaS players, as mentioned in our prior blog, offer prebuilt integrations to popular, adjacent applications. Numerous vendors vie for what they generally call single-pane-of-glass management in multiple forms, with all vendors stressing analytics and automation in some manner.

Just as paramount is the economywide war for talent. Qualified talent versed in new technologies and tools are sought virtually everywhere, making it an employee’s market. As is the case with any acquisition, talent retention and recruitment will be key to the innovations Boomi has charted out in its development road map. In acquisition parlance, it is called putting “the golden handcuffs” on essential personnel to ensure they do not jump to a competing firm. Locking down key engineering talent will be critical.

Situationally, iPaaS tool sets can be acquired either in best-of-breed fashion or by standardization on one platform that is expansive enough to solve an immediate need and evolve with the organization. In large enterprises, there could be a mix of tools based on those brought into the organization via acquisition. In this way, iPaaS brands can be pigeonholed for what they have been offering and not necessarily given consideration for their go-forward innovations. In turn, tool purchases are often a derived decision as part of a broader initiative. The cost is justified in terms of the time savings for the business initiative rather than how the purchase will make the life of the IT department easier.

It is for this reason Figure 1 references “Strategic Alliances; ‘White Label.’” Externally, many global systems integrators (GSIs) are pivoting to managed services offerings, especially the advisory firms with deep tax and audit credentials, whose distinction comes from the tax and audit knowledge base they can automate to address data management, governance and compliance rules.

By underpinning GSI software development with its own tools, Boomi can gain a distinct selling advantage into large enterprises as it will have these influencers and quasi sellers  at its disposal. Tighter relationships will also help Boomi keep an ear to the ground on the emerging technology vendors that GSIs and early adopter enterprises are considering and those that pose an asymmetric threat to the Boomi core.

Furthermore, Boomi made clear it does not aspire to substantially grow its consulting and services operations. GSIs will find this clear swim lane delineation refreshing considering the ways in which traditional services and software firms are beginning to encroach on one another’s core offerings.

Inside out: Transforming direct selling and creating new demand through ‘add to cart’

As a technology firm selling technology to IT departments, Boomi has sound, traditional selling motions. Increasingly, however, we hear the clarion call of selling business outcomes, and that move to consultative selling to lines of business will be necessary, given technology matters less and less while people and process matter more. In turn, studies show buyers want to self-research products and then self-provision those products from online portals.

Boomi has made steps in that regard with the availability of its AtomSphere Go edition, which aims to give customers a frictionless buying experience, at an early entry price point of $50 per month. AtomSphere Go also gives Boomi a way to disaggregate the various services in the existing offer to allow Boomi to move down market to reach late-majority enterprises. Additionally, Boomi recently announced AtomSphere Go is available on Amazon Marketplace, the mecca for seamless, add-to-cart ordering.

That type of selling, often called “land and expand,” has a very different set of operating best practices than traditional direct, or blue suit, selling. The aspiration of this kind of selling is lifetime customer value (LCV). It requires a different type of telephone support that is part technical advisory and part consultative selling for cross- and up-sell opportunities with smaller enterprises.

It is also a business model where revenue and expense do not align to the 90-day quarterly reporting cycle. This requires a leap of trust to embark on such selling approaches, as costs will far outweigh revenue until scale is achieved and the “flywheel effect” kicks in. For startup operations it is a very prominent challenge, and for Boomi the challenge will come more from setting up the operations with different motions and finding a way to balance investing in selling motions with awaiting payoff of the new add-to-cart operations.

Situation analysis: Never confuse a clear view for a short distance

TBR has laid out Boomi’s situation analysis levers as 1) talent retention and ongoing innovation to continue evolving a traditional space (iPaaS) that is being encroached upon by startups and established vendors on all sides, 2) heightened partner selling, and 3) a challenging shift to the add-to-cart selling model primarily to move down market, which requires fiscal patience. Provided there’s a vision match with the new owners, Boomi has solid platform depth and breadth with a reasonable innovation road map to survive and thrive in this ever-accelerating business pivot where automating data management, seamlessly moving data and empowering the right users to engage with data are paramount to maintain a persistent competitive advantage no matter the standard industrial classification (SIC) code.

So, what do you think? Will Boomi’s strategy succeed with new management?

In TBR’s newest blog series, What Do You Think?, we’re sharing questions our subject-matter experts have been asking each other lately, as well as posing the question to our readers. If you’d like to discuss this edition’s topic further, contact Geoff Woollacott at [email protected].

At its customer conference, Informatica unifies cloud-agnostic data management

TBR perspective

According to TBR’s December 2020 Digital Transformation: Voice of the Customer Research, 61% of respondents indicate cloud computing is the leading technology they purchase as part of their central digital transformation (DT) initiatives. Over the course of the next five years, enterprises will continue to lead with cloud-first strategies — a trend that will be accelerated due to lessons learned from the COVID-19 pandemic. As customers move outside the data center, control over IT assets rapidly changes, as by no longer owning their hardware, customers can focus on data to drive innovation. Since cloud migration is the first step in unlocking data insights, Informatica is positioning its new solutions, most notably Intelligent Data Management Cloud (IDMC), as the foundation for true digital transformation. While maintaining strong ties to technical specialists, such as data scientists and engineers, Informatica’s ability to enable DT with a cloud-first approach positions the company to expand its applicability to nontechnical influencers and evolve its portfolio for a data-driven economy, which will be underpinned by cloud infrastructure.

By unifying data management with the cloud, IDMC will serve as the connection point for Informatica’s entire portfolio

Historically, Informatica’s Intelligent Data Platform (IDP) has underpinned much of the company’s core portfolio and provided customers a landing spot for their data management, integration, quality and security services. However, as cloud continues to dominate the technology landscape, Informatica’s strategy and market messaging are evolving to address customers’ challenges around storing data in the cloud. While leveraging the same underlying technology as IDP, IDMC takes data integration and management to the next level, offering customers over 260 services natively built into the platform, which can be deployed in the public or private cloud and consumed in a pay-as-you-go manner. Meanwhile, at the core of the platform remains Informatica’s embedded AI engine, CLAIRE, which acts as a system of record for metadata and helps customers derive insights across assets and product modules. The launch of IDMC reaffirms Informatica’s commitment to the cloud and modern applications, as IDMC serves as a complete replacement of IDP, which largely supported traditional software. Nonetheless, with a more scalable delivery model, the release mirrors the modular approach Informatica has always applied to data, offering customers choice and flexibility when it comes to the services that can be deployed on top of the platform, and their underlying data sources. For example, during the event’s opening remarks, Informatica Chief Product Officer Jitesh Ghai discussed how the company’s services are agnostic across infrastructures and data processing methods. An example of this impartiality is highlighted in services like Database Ingestion, which allows customers to take data residing in an Oracle database and move it into storage with an Azure data lake, for example. Informatica’s Data Integration service on IDMC is another example of how customers can leverage Informatica to integrate data across leading public clouds as an alternative to using three competing services from each cloud provider.

Supported by the cloud, Informatica’s platform services and capabilities meet customers’ specific business needs

Customer experience (CX) also remains the cornerstone of digital transformation efforts, and customers are adopting CX frameworks backed by emerging technologies, including AI and machine learning (ML) to complement their back-office operations. CX remains integral to Informatica’s strategy, evidenced by the January 2021 launch of Informatica Customer 360 as a SaaS solution. Customer & Business 360 is one of the core capabilities supported by IDMC in providing customers with a single-pane view of data across key business functions. Other capabilities of the platform that are in line with the main benefits of cloud computing include data discovery, ingestion, preparation, cleansing, records, delivery and governance. Throughout the event, one of the customer highlights was from Peloton (Nasdaq: PTON), a born-in-the-cloud company that has adopted IDMC to support its daily volume of roughly 10 million to 15 million records. Further, the New York State Department of Health adopted Informatica’s platform and leveraged the benefits of cloud-native analytics to support decisions and drive efficiencies during the height of the COVID-19 pandemic. Emphasizing data-driven business initiatives is a key gap IDMC aims to fill, as the platform not only supports customers’ IT initiatives, such as data engineering and warehousing, but also targets core business functions, such as e-commerce and finance. TBR suspects these core capabilities delivered through IDMC will provide Informatica with a strong competitive position, as the company unifies IT teams and line-of-business leaders through a cohesive data platform. 

What would have been a large gathering in the heart of Las Vegas became Informatica’s biggest virtual event, which hosted over 10,000 registrants and featured talks from customers, partners and industry experts on their experiences with data and the critical role it is playing in the digital economy. Informatica World 2021’s theme of going from “Binary to Extraordinary” speaks to Informatica’s main announcement — the launch of its Intelligent Data Management Cloud — as the company looks to support a variety of data-centric use cases, which are positioned for success when built in the cloud. While Informatica’s neutral standing — as the “the Switzerland of data,” as CEO Amit Walia puts it — remains unchanged, a cloud-first approach positions the company to meet a unique set of challenges enterprises face in the cloud, regardless of underlying infrastructure or deployment method.

Is the term data protection anachronistic?

The only real constant in the technology industry is change, and that change has been accelerating rapidly and is now poised to explode. During the many transformations that have occurred in the industry, legacy terms well known for one thing lose favor or actually wind up adding confusion rather than clarity to the discussions.

Business intelligence, for example, was a well-known term that seemingly addresses what analytics, cognitive computing and machine learning deliver better today than when the term gained broad adoption 20 years ago.

Distributed computing crystallized the value of minicomputers as a way to move computing out beyond glass walled mainframe estates. Engineering wise, it is what we do at the so-called “edge” today as well as on chipsets deployed in endpoint devices.

And data protection is the new term to wind up sounding anachronistic in our current conversations. Data protection historically meant protection from loss or theft. Today’s data protection has to include exposure of that data in the normal course of business that does not violate privacy as well.

Historically, data protection was generally left to IT administrators to determine. However, data privacy and the attendant impact on brand image have changed that dynamic, leading TBR to say that data protection has changed from a boiler room to a board room decision. This implication was on full display during a PwC Risk Assurance event attended by TBR in April 2018 where the conversation in the buffet lines at lunch centered on Facebook CEO Mark Zuckerberg’s congressional testimony taking place at the same time. No corporate executive wants to have to testify before Congress about topics violating their customer trust.

Furthermore, virtualization makes the concept of a security perimeter for protecting data seem archaic given data sits literally everywhere. Defending the data center has given way to securing the persona, with individuals having multiple personas across multiple work and personal access points.

What, then, should be the all-encompassing term to address the broader context of what it means to protect data?

In custom projects around this topic, TBR spends a great deal of time and attention to parse out definitions at the onset of the research. In TBR’s point of view, historical data protection remains a vital pillar within the overall context of data stewardship. If data is the new oil, then managing, protecting and leveraging that data drive the business.

  • Managing data implies to TBR the establishment of the global business rules and company governance models. Governance extends beyond the traditional requirements of regulatory compliance to incorporate the corporate risk appetite for exposing data for different use cases. Integral to this is the permissioned access to data users and the permissioned exposure of the different data suppliers, most notably customers.
  • Protecting data addresses all the traditional elements associated with the legacy term data protection.
  • Leveraging data is the delicate balance of the business management team. On the one hand is the revenue lift that can come from infusing a business action with data mapped back against the risk to the business of exposing that data in that particular use case. Here is where the board room leadership makes the business judgment calls in the data economy, and hence why TBR states that data protection as we knew it has shifted from a boiler room to a board room decision.

Informatica adds intelligence to data management but faces unusual competition as traditional roles blur

The Customer Data Management landscape

Informatica continues to thrive in its position as an agnostic third-party data management vendor that supports enterprises’ applications and data initiative. This approach has served Informatica well, as tailored solutions such as Customer 360 have complemented and supported leading front-office applications like Salesforce with customer data management. As front-office application vendors innovate to challenge Salesforce for market share, many are building customer data platforms that enhance the information feeding these applications and build a case for full-suite sales across front-office touch points. Among this competition, there is also a driving need to build greater insight and intelligence into customer data. Informatica’s acquisition of AllSight greatly strengthens the intelligence it can deliver around its clients’ customer data, but applications-led vendors will increasingly challenge Informatica in the customer data management space as they look to build out their value propositions.

Unifying and adding intelligence around customer data is a ubiquitous priority

Vendors across the cloud-based and traditional software landscapes want to elevate the value they provide customers and increase their addressable market by prioritizing unified and intelligent data to power enterprises. Data efforts are following the same workloads trends as cloud applications, focusing on CRM first before HCM and ERP to build traction in the market.

Applications-led vendors such as Salesforce, Oracle, SAP and Adobe are leveraging the data their individual sales, marketing, customer support and commerce applications generate and consume. This allows vendors to craft partnerships, new solutions and data model transformations to unify and enrich the data across all discrete application areas. The message shapes up to enable an enterprise to equip all front-office functions with a single and complete depiction of each customer or prospect that tracks and contextualizes actions at every point of the customer life cycle. In the last nine months we’ve seen numerous developments along these lines, including:

  • SAP announced the unification of its customer experience applications into a single suite, C/4HANA, with plans for deep integrations and layers of intelligence.
  • Adobe, Microsoft and SAP announced their alliance under the Open Data Initiative to give joint clients a more comprehensive view of their customers by enriching data across each vendor’s front-office applications.
  • Salesforce announced Customer 360 to update records across its systems with new information via a unique customer identifier.
  • Oracle announced CX Unity as a data platform that unifies data across Oracle and partner front-office applications to provide a comprehensive view of engagement points and additional data intelligence.
  • Salesforce announced intentions to offer a customer data platform to store a unified profile of customers.
  • Adobe announced a customer data platform.
  • Adobe and Microsoft expanded their relationship, launching new tools and leveraging data from LinkedIn to provide purchasing insights for B2B sales and marketing.
Customer 360 solutions graphic by Informatica

Consultancies and IT services vendors face uncertainty in a shift to data and automation for 2019

As we start the final three months of 2018, TBR’s Professional Services Practice (PSP) has begun wrapping up analysis on the year as a whole and thinking more about what 2019 will bring, specifically in the areas of healthcare IT services, data management and consulting. Top-of-mind issues for TBR’s clients and the PSP analysts reflect today’s driving trends and set the stage for the next few years.

Now: Cloud, competition and emerging tech uncertainty unsettle HITS vendors

TBR’s healthcare IT services (HITS) practice has noted rising interest in electronic health record (EHR) systems and other health IT solutions, for example, patient data storage and application hosting in the cloud, tempered only by ingrained concerns about data privacy and security. EHR-centric companies aggressively cross-selling emerging solutions to their existing installed base of EHR clients have simultaneously captured new EHR work in the vast white space of latent demand for EHR systems outside the U.S. Complementing those efforts, increased cloud adoption generates opportunities for systems integrators to digitally transform payer, provider and life sciences organizations alike. For example, community hospitals eager to digitize and better connect with other providers in the healthcare ecosystem have become a growth engine for many HITS vendors, a trend that favors small-scale EHR providers, especially those that have pivoted to cloud, compelling leading vendors to scale down flagship EHR platforms and adopt small- to mid-market deployment models.

TBR closely monitors and analyzes the impacts to the business models for key HITS vendors as new pressures compel a shift toward different clients and markets, including the following development:

  • Will cloud-based EHRs, infused with automation analytics for care and administrative processes, artificial intelligence (AI) for genomics-informed medicine, machine learning and telemedicine become more commonplace?
  • How will executives at HITS vendors approach retrofitting existing EHR systems with these emerging solutions, in addition to integrating human-centered design into new EHR platforms?

Digital transformation advances analytics and insights

Realizing the dream of AI-embedded business processes must start with people and data management

Realizing the dream of AI-embedded business processes must start with people and data management

Every enterprise looks to use emerging technologies to cut costs, grow revenue or create new business models. The combination of changes in how people work and what new technologies can best be applied creates massive opportunities for services vendors. This new market — broadly defined as “digital transformation” (DT) — will evolve through the current hype peak into a long, steady stream of fundamentally traditional services engagements involving a mixture of process knowledge and technical expertise. Though no longer “emerging” technologies, data management and analytics software remain at the core of DT initiatives and adoption of truly emerging technologies such as artificial intelligence (AI). As the analytics and insights (A&I) professional services market matures, competencies around AI, human-centric user experience design and DT-related change management will be key to vendors’ future growth.

To sustain A&I professional services opportunities over the long term, vendors must stay on top of AI technology developments while maintaining a broader perspective on the impact of AI on clients’ business processes and human resource (HR) strategies. As AI adoption grows, so does the technology’s complexity, particularly at the intersection points between humans and machines and between regulatory policy and technological innovation. We expect rising concerns around security and governance, regulatory compliance, and HR implications of AI systems will continue to drive consulting and solution design engagements tied to broader DT initiatives. To capture these expected opportunities, A&I services vendors invest in service and technology offerings to assist clients with AI adoption — from upfront advisory to data integration, application development and managed services. However, despite vendors’ massive investments in AI capabilities and a growing number of high-profile use cases for the technology, TBR’s research around enterprise DT initiatives indicates clients have not fully bought into the value services vendors can provide in creating AI solutions, suggesting vendors have a marketing challenge to overcome.

The model for a successful vendor is indeed a tall order. Our research indicates enterprises undergoing DT want vendors to understand their business problems in both industry and functional contexts, create solutions that mesh with their existing IT environments and maintain security, and cultivate robust ecosystems of best-of-breed technology partners. While building out strategies around each of these pillars, vendors should message how they can address technical challenges such as data preparation and training to help clients start and continue experimenting with AI, as well as provide process transformation and change management advice to enable clients to bring those experiments to scale. Vendors must walk a fine line between establishing a long-term vision for the future of business and directing clients where to take the first step toward achieving their goals. Framing AI adoption in the context of methodical modernization of individual business functions, rather than as an excuse to play with cool new technology, will keep vendors on the right side of that line.

TBR will continue to monitor the impact of AI on vendors’ go-to-market strategies and enterprise customers’ IT and professional services buying behavior through its Analytics & Insights Professional Services Vendor Benchmark, Digital Transformation Services Market Landscape and Digital Transformation Customer Research. For deeper insight on this topic, see our event perspective on the 2018 O’Reilly Artificial Intelligence Conference, held this past April in NYC.

For more information, contact Senior Analyst Jennifer Hamel ([email protected]).