The 2017 State of the Services Economy Report

I’m happy to announce the release of the 2017 State of the Services Economy Report that I worked on for the past six months with Mavenlink, one of the best reports I worked on in the past several years. Visit this page to download the full report.

I co-authored the report with Ray Grainger, the CEO of Mavenlink. We were supported by a great team, and supported by ResearchNow. We also had great contributions from my research panel: David Coleman, Steven Fisher, Martin Gaedke, Maddie Grant, Jean Russell, Brian Solis, and Joachim Stroh.

We started with some core premises for the research. We believed that the rate of change in the service economy was very steep, and that turned out to be the case: Over three quarters (78.3%) of our survey’s respondents state business conditions are changing quickly, and 20% say it’s faster than ever before.

This sets the deep background for everything else discussed in the report: an unrelenting pressure to adapt to a rapidly changing business context, one that — at least for some — is changing as quickly as it ever has.

A major trend in services companies is the rapid transition to project-based work, away from retainer-based models, and the bigger the company, the quicker the transition. This transition seems tightly linked to the need for greater agility and flexibility by services companies’ clients.

We expected that the best defense against the onslaught of technology-induced change would be… more technology. 70% of those surveyed say they are adopting new technologies, and only a small group are holding out against new technologies.

The third big bang from the research has to do with competition. Times of great change can lead to increases in the level of competition, and our survey confirmed that.

We asked if companies are seeing increased competition:

  • 62% said they are.
  • Of those that are seeing more competition, 26.8% says it’s coming from existing competitors,
  • 36.6% indicate it’s coming from new entrants, and
  • 36.6% say it’s a combination of the two.

That means the greatest competitive threat is coming from new entrants, in general.

So, the hard bottom line: accelerating change, transition to project-based economics, more defensive and offensive technology, and more competition.

Welcome to the accelerating services economy.


This research was sponsored by Mavenlink, but the opinions stated are my own. Originally published at www.stoweboyd.com.

The State of Salesforce Community Cloud

It’s the eve of Salesforce.com’s annual Dreamforce event, and I have the company and its customers on my mind. I’ll be attending Dreamforce again (Disclaimer: Salesforce is covering my registration, travel and hotel expenses). As always, I’ll be taking in all the announcements at Dreamforce, but paying the most attention to the Community Cloud, individual applications and platform components that make up the Salesforce collaboration and content management ecosystem.
Before Dreamforce begins, it’s useful to think about the actual state of collaboration amongst Salesforce’s customer base. There will be marquee customers on stage this week talking enthusiastically about their cutting-edge use of Salesforce’s latest offering versions, including those that are not yet generally available. But what about the mainstream Salesforce customer and how they’re using the company’s products to collaborate?
To get a sense of that, I digested The State of Salesforce survey report that was recently published by Bluewolf, a global consultancy that designs customer-facing, digital experiences using third-party, cloud-based software. This year’s report is the 4th annual edition published by Bluewolf, who surveyed more that 1,500 Salesforce customer organizations, of varied organizational size and located around the world.
Bluewolf’s report does not investigate every bit of Salesforce’s collaboration and content management functionality in detail. Instead, it focuses on the assembled collection of those that is the Community Cloud. In two pages of The State of Salesforce, Bluewolf reports on Salesforce customers’ adoption of Community Cloud, its most common use cases and the high-level business benefits that customers attribute to its use.

Community Cloud Adoption

Of the Salesforce customer companies that have purchased Service Cloud, Sales Cloud, and Marketing Cloud, 36% have also purchased Community Cloud. That represents decent adoption by Salesforce’s best customers, especially for an offering that has only been in-market for a year. Even better, 21% of respondents that already license those other Salesforce clouds said that they plan on purchasing Community Cloud in the coming year. If that pans out, then over half of Salesforce’s most dedicated customers will be on Community Cloud within two years of its launch.
What the report doesn’t illuminate, and I’ll try to investigate at Dreamforce this week, is Community Cloud adoption by the rest of the existing Salesforce customer base. It’s likely that the bar is set much lower there and that Salesforce will need to refocus its marketing and sales of Community Cloud for the next wave of potential adopters. Selling Community Cloud as an enhancement of the other Salesforce clouds is very different than convincing organizations of its utility as an independent collaboration and content management solution.

Community Cloud Use Cases

As for Community Cloud use cases, Bluewolf’s survey found that the top three were Customer Service (25% of respondents), Partner Enablement (21%) and Internal Collaboration (17%). Given Salesforce’s current positioning as “The Customer Success Platform”, and the amount of resources it has spent to launch and grow the Service Cloud, it isn’t entirely surprising to see that so many customers are focusing their use of the Community Cloud on post-sales customer service.
What I did not expect is that a larger number of Community Cloud customers are using it for partner enablement than they are for internal collaboration. Given Chatter’s roots as an internal-only communication tool, I would have expected to see more internally-focused usage of Community Cloud than what was reported. Of course, Chatter isn’t the only component of Community Cloud, but it is the oldest and most established among Salesforce customers. It will be interesting to learn more this week about why external community support is out in front of internal use of Community Cloud.

Community Cloud Business Benefits

The final area of interest here that The State of Salesforce report provides data on is business benefits associated with Community Cloud. Bluewolf compares productivity gains and cost reductions reported by two Salesforce customer segments, those who are using Community Cloud versus those who aren’t.
Community Cloud Biz Benefits
Clearly, Salesforce customers who are using Community Cloud in tandem with one or more of the company’s other offerings are realizing higher productivity and lower operating costs than customers who have not adopted Community Cloud. No surprises here. As noted above, Community Cloud is an enhancement and enabler to the other Salesforce clouds. This data is proof of that notion’s validity.

The State of Salesforce Community Cloud

Bluewolf’s The State of Salesforce report raises as many, if not more, questions than it answers about collaboration and content management among Salesforce.com’s customers. As a result, it’s hard to derive much insight from the survey data reported other than that Community Cloud is enjoying respectable adoption among Salesforce’s best customers, and they are seeing greater benefits by using it with the other Salesforce clouds, especially for external-facing use cases. While I can gather some anecdotal stories and learn more at Dreamforce this week, another survey would be needed to get the data necessary to understand how successful Salesforce’s collaboration and content management offerings have been with, and for, the rest of its customers.

Report: Google preparing iOS app for Android Wear smartwatches

Right now, you need an Android phone to use an Android Wear smartwatch. But according to a report from French technology website 01net, Android Wear might be going cross-platform with an iOS app, possibly launching at Google’s annual developer conference in May.

When Apple Watch launches in the next month, it will require an iPhone to work. Android compatibility is extremely unlikely. If Google were to allow Android Wear smartwatches to work with iOS devices, that would be a significant difference between the platforms, and some users would see it as a reason to pick an Android Wear device over an Apple Watch. At the very least, it would expand the market of possible Android Wear users.

Last year, Android Wear senior product manager Jeff Chang hinted that Google was contemplating cross-platform compatibility for Android Wear but had run into technical obstacles. “It’s not always completely up to us right? There are technical constraints, API constraints so we are trying really hard, ” Chang told the Huffington Post.

Currently, we have to treat this report as a rumor. Although 01net is a reputable website, it doesn’t cite a source — only “according to our information” (selon nos informations) — and warns that it hasn’t been confirmed.

Still, it’s fun to imagine a time in the near future when your Moto 360 could talk to your iPhone 6. Recently, a developer who goes by MohammadAG hacked his Android Wear smartwatch to talk directly to an iPhone using Apple’s notification services. Although it was more of a concept than a working Android Wear solution for iOS, it showed that it’s possible. Given that Google has native iOS support for many of its products, it wouldn’t surprise me if Google is working to bring Android Wear beyond Android. Let’s see it happen, Google.

Report: The refurbished smartphone market is booming

One major factor that’s driven the explosive growth of the global smartphone market is its short, roughly two-year upgrade cycle. But now that that even three and four-year old smartphones are powerful enough for most people’s daily use, there’s about to be an big jump in sales of secondhand and refurbished smartphones, according to a new report from Gartner.

Gartner expects the worldwide market for refurbished smartphones to hit 120 million units by 2017, for a projected $14 billion in wholesale revenue. That will be up from 56 million refurbished phones shipped in 2014. Often, refurbished devices are “good as new” for the consumer. Although they might not come in original packaging, they usually have been tested for defects and arrive scratch- and dent-free, sometimes with a new battery.

Obviously, anyone who purchases a secondhand smartphone is significantly less likely to purchase a new smartphone, which could affect the revenue not only of smartphone makers like [company]Apple[/company] and Samsung, but also the demand for parts in the supply chain. It could also affect companies that focus on mid-range devices, like Xiaomi. Instead of purchasing a phone that’s a “good value,” an older premium device for the same price could be very attractive.

Gartner points out there’s an opportunity for United States companies to send old devices overseas — or, into the “worldwide market.” The iPhone 4S might be seen as an older, unattractive device in rich markets, but given Apple’s premium brand recognition, refurbished units could be more desirable than a similarly priced new phone in developing markets.

Manufacturers also use refurbished units as warranty trade-ins. When you get a new iPhone from an Apple Store because your old one wasn’t working, it’s probably a refurb unit.

Where are these secondhand devices coming from? Gartner surveyed consumers in the United States and Germany — two mature and rich smartphone markets — and found that nearly 64 percent of devices found a second life, usually through private sales and trade-in programs, like the ones your carrier offers when you upgrade your device. Twenty-three percent of devices were handed down to a friend or family member. According to the survey, only 15 percent of devices languished unused, and only seven percent were officially recycled.

Of all the American carriers, Sprint might be in the best position to take advantage of the global market for refurbished smartphones. Its CEO, Marcelo Claure, cut his teeth at Brightstar, which does a lot of smartphone refurbishing business. Plus, its new leasing programs mean that in about two years, the company is going to have a lot of used iPads, iPhones, and other high-end devices on hand. Many of those devices could stay in the United States, because Sprint’s roster of smaller prepaid operators need phones that work on Sprint’s CDMA network.

 

Mozilla Says Firefox Still Has 30% Market Share

In its first-ever State of the Internet report, the Mozilla Foundation says that the Firefox browser has close to a 30 percent share of the browser market around the world, with usage growing most strongly in Russia. Firefox has been under increasing pressure from Google’s Chrome.

iPhone Dominating Worldwide Smartphone Usage: Report

The iPhone is still doing tremendously well, in case all this buzz around Google’s (s goog) new Nexus One had you thinking otherwise. A new report by Google’s own recent acquisition AdMob says as much. The report details smartphone usage globally over the last quarter of 2009, as determined by requests made by devices for ads on AdMob’s extensive mobile advertising network.

Worldwide, the iPhone accounts for more than half of the total overall smartphone usage. It’s worth noting that doesn’t necessarily mean that the iPhone’s actual market share is double that of all other companies combined, only that iPhone owners use their devices much more than the owners of any of its competitors do. Read More about iPhone Dominating Worldwide Smartphone Usage: Report