April 8, 2011
Both are prominently featuring "energy" in their messaging in keeping with the current customer focus on that side of the consumption/emissions coupling. And both are emphasizing a combination of software products and consulting services, the two segments of the market that we at Forrester have been tracking for some time now, as regular readers of this blog know by now.
But under the surface there are more differences than similarities in the approach that these two suppliers are taking to ITfS; differences that illuminate divergent strategies, philosophies, and experiences between them. Let's take a closer look.
HP is going broad; IBM is narrowing its focus. With its initial "Energy and Sustainability Management Services" entry, HP is leveraging its data center design and implementation expertise into buildings and other assets across the enterprise. It is stressing a holistic, top-down approach, starting with assessment workshops and other methods to help customers get their arms around the size and shape of the energy/carbon/resource issues.
It's reminiscent of IBM's "House of Carbon" approach out of its UK-based sustainability consulting organization, circa 2008. Meanwhile, IBM has considerably narrowed its focus since that time. We don't hear much from IBM about the corporate-wide carbon challenge any more; the acquisition of Tririga last month reinforces that IBM's focus is squarely on the corporate real estate and facilities market, a.k.a. in IBM-speak, "smarter buildings."
HP is partnering; IBM is acquiring. HP is going to bring enterprise carbon & energy management (ECEM) software to its customer engagements via partnerships with Hara and C3.
Both companies' products will fit well with the top-down, corporate-wide approach that HP is adopting; they are designed for C-level aggregation, analysis, and reporting of corporate resource consumption and resulting emissions. And they are the most prominent of the clean-sheet-of-paper startups in the ECEM market; Hara with a good customer list and C3 with an enviable set of backers (although still in quasi-stealth mode).
Meanwhile, IBM is adding Tririga to its Tivoli-anchored set of software acquisitions aimed at corporate asset and resource management, which most prominently includes Maximo (bought in 2006). It promises to integrate Maximo's enterprise asset management with Tririga's workplace management systems over the next couple of years. IBM is still missing a true ECEM software system, but we would bet not for much longer.
HP has one customer door; IBM has several. Reflecting its relative-newcomer status in the ITfS market, HP will for the moment have a single path to its target customer in the corporate C-suite: through IT.
The early adopters of HP's solutions will come to it from its data center design practice (the EYP consulting practice it acquired in 2007). HP's path to the executive suite will be, for the moment, through the CIO; we expect further partnerships on the consulting services side to prospectively open up channels to other customer execs especially the CFO. IBM is a little further down the track, with a green data center business and other hooks into IT, Maximo customers who come principally from the operations and COO organization, and now Tririga with hooks into facilities and real estate (which lead to both the COO and CFO).
What's next? The Tririga acquisition, coupled with Oracle's recent buy of Ndver, may well be the catalyst for an overdue consolidation in the broad ECEM market, which grew from roughly 30 suppliers when we first analyzed it in late 2009, to more than 70 suppliers at the end of 2010. That's too many, even for a market growing quickly towards the $1 billion mark.
And the backing and continuing investment of credible, bottom-line oriented companies like HP and IBM bode well for ITfS becoming part of mainstream corporate strategy. As our friends at SAP say, we are on the cusp of companies no longer having sustainability strategies, but rather having sustainable corporate strategies.
As always we welcome your reflections in the comments section below.