I haven't been to Forrester's Cambridge offices before, but it's quite the location, at least that's what the maps show me. It's smack in the middle of MIT and just a mile from Harvard. So far Orientation's been a blast. Virginia Crossa is quite the instructor and has a great way with motivating and challenging the class.
There's a few of us from the Santa Clara office as well, Jasmin Dave who's an ADM in sales, and Frank Chiang who totally missed the flight and is on Video Conference. In addition, there are 4 new analysts in the program, some have started already. We've got a government expert, Alan Webber coming in as a Consulting Analyst. He's got quite the background with many federal agencies. There's also a telecom analyst, Ellen Daley, who's has a ton of telecom experience with a great presence. On my team, I've got a colleague, Bill Band who's the neighbor of Chris Mines, the head of research. He's a former Accenture Partner and Coopers guy covering CRM. With such company, this should be quite the class.
So much is spinning in my head right now. You've got phone calls to take, docs to write, and consulting to worry about. I have no idea how I'm going to hit these goals at the moment, but it's well worth the try. This job looks like it'll have a steep ramp up!
(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2005 by R Wang. All rights reserved
Wednesday, January 26, 2005
Monday, January 24, 2005
Analyst 101: From Vendor Side to the Dark Side?
My First Morning as a Forrester Analyst
So, I'm really excited here. It's my first day as a Forrester analyst and it's quite amazing. I'm up early since orientation is in a few hours. They've got me at this funky hotel called the Hotel Marlowe. It's next door to the Monitor offices and across from that god awful hotel the Royal Sonesta. The Kimpton Group always has some cutting edge designs including the leopard prints everywhere. The good news is I made it in just before the snow storm, but on the down side, it looks like a great New England winter storm is going to be with us for the week.
Well, after being on the other side for most of my career, now I'm going to be working with some of the best minds in enterprise apps. It's quite an honor to be at the same firm as John Ragsdale, Paul Hamerman, Erin Kinkin, Keith Giles, Andy Bartels, Elana Anderson, Merv Adrian, Navi Radjou, Laurie Orlov, Mike Gilpin, John Rymer, Randy Heffner, and Eric Schmitt. These analysts have always been the most genuine. My coverage area is Order Management, ERP, and I think a few other areas as we figure out the holes. Stay tuned as I make sense of what the job really entails!
At this point, I'm not sure what to say to these legends, now that I'm in the same firm, but I've got a lot to do and a lot to prove. There's quite a tradition to live up to here as industry analysts are the technology industry's equivalent to superstars in the entertainment industry.
Wish me luck and send me pointers!
(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2005 by R Wang. All rights reserved
So, I'm really excited here. It's my first day as a Forrester analyst and it's quite amazing. I'm up early since orientation is in a few hours. They've got me at this funky hotel called the Hotel Marlowe. It's next door to the Monitor offices and across from that god awful hotel the Royal Sonesta. The Kimpton Group always has some cutting edge designs including the leopard prints everywhere. The good news is I made it in just before the snow storm, but on the down side, it looks like a great New England winter storm is going to be with us for the week.
Well, after being on the other side for most of my career, now I'm going to be working with some of the best minds in enterprise apps. It's quite an honor to be at the same firm as John Ragsdale, Paul Hamerman, Erin Kinkin, Keith Giles, Andy Bartels, Elana Anderson, Merv Adrian, Navi Radjou, Laurie Orlov, Mike Gilpin, John Rymer, Randy Heffner, and Eric Schmitt. These analysts have always been the most genuine. My coverage area is Order Management, ERP, and I think a few other areas as we figure out the holes. Stay tuned as I make sense of what the job really entails!
At this point, I'm not sure what to say to these legends, now that I'm in the same firm, but I've got a lot to do and a lot to prove. There's quite a tradition to live up to here as industry analysts are the technology industry's equivalent to superstars in the entertainment industry.
Wish me luck and send me pointers!
(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2005 by R Wang. All rights reserved
Friday, January 21, 2005
Software Licensing and Pricing: Focus Efforts on Maintenance First
Maintenance costs are the most expensive over the long term
Focus negotiations on total cost not just license costs. Many enterprises enter into software contracts focused on license cost. However, the key driver of costs is really maintenance. At 17 to 25% of the license cost, enterprises end up buying up to 2x the original cost of software in a 10 year period. Let's take a look at what this means:
Number of licenses: 1000
Average cost: $2000/named user
Maintenance %: 20%
10 year license cost: $2M (assuming upgrades are free)
10 year maintenance: $4M (assuming no maintenance fee increases in between)
As you can see, the focus on negotiations should be on the maintenance fee increases as well as the maintenance fee percentage.
Quick advice:
1. Focus on negotiating a lower maintenance percentage
2. Use net price not list price as the starting point
3. Cap maintenance fee increases for the life of the relationship to x% or CPI whichever is lower
4. Agree upfront on how upgrades and additional modules will be priced into maintenance contracts
(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2005 by R Wang. All rights reserved
Focus negotiations on total cost not just license costs. Many enterprises enter into software contracts focused on license cost. However, the key driver of costs is really maintenance. At 17 to 25% of the license cost, enterprises end up buying up to 2x the original cost of software in a 10 year period. Let's take a look at what this means:
Number of licenses: 1000
Average cost: $2000/named user
Maintenance %: 20%
10 year license cost: $2M (assuming upgrades are free)
10 year maintenance: $4M (assuming no maintenance fee increases in between)
As you can see, the focus on negotiations should be on the maintenance fee increases as well as the maintenance fee percentage.
Quick advice:
1. Focus on negotiating a lower maintenance percentage
2. Use net price not list price as the starting point
3. Cap maintenance fee increases for the life of the relationship to x% or CPI whichever is lower
4. Agree upfront on how upgrades and additional modules will be priced into maintenance contracts
(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2005 by R Wang. All rights reserved
Subscribe to:
Posts (Atom)
