September 12, 2013
HP recently hosted its Asia Pacific (AP) and Japan analyst event in Singapore. The company presented its “New Style of IT” value proposition and how it intends to position a combined HP hardware, software and IT services stack to deliver client value. After the Boston event back in February, I was particularly interested to see how HP Enterprise Services (ES) is positioning itself as the tip of the spear of the “one HP” messaging and offering in Asia.
When assessing service providers’ relevance to customer needs, I focus on two major areas:
- Red ocean offerings – where service providers need to help their clients build scalable, flexible, secure and cost efficient technology foundations around cloud, mobility and analytics.
- Blue ocean offerings – where service providers need to help the CIO engage business stakeholders to drive better business outcomes in areas like customer experience, for instance.
I believe HP has excellent capabilities to help AP-based CIOs overhaul and manage their technology foundations. Case in point: a complete outsourcing contract they recently signed with a service provider focusing on visa and administrative services for governments in more than 77 countries. The client's Global CIO highlighted the key reasons why the company selected HP as its main IT partner: global scale and flexibility to align service levels with business objectives. Generally speaking, I’m convinced HP ES is working hard to deliver more value to its AP-based clients. In fact, HP reports that client satisfaction increased by more than 10% in recent months. The recent SAP Hana as a service offering also shows that HP can innovate in Asia Pacific specifically for AP organizations.
But the pendulum of tech spending is rapidly shifting towards the business. As a result, it is critical for tech vendors like HP to help CIOs engage business stakeholders to foster business innovation. Now that HP ES has made good progress in the red ocean area, it must clearly articulate an official “blue ocean” strategy and messaging that covers the following:
- New skills that help bridge the gap between business requirements and HP offerings. The client principal role is not new at HP, but the company has decided to refresh its content and make sure this sales position leverages real vertical industry expertise.HP must accelerate the recruitment of new client principals in 2013-2014 across the region and ensure they work hand in hand with internal CTOs to architect new tech-enabled business capabilities for its clients.
- New engagement and delivery models that align to business metrics. The deal highlighted above provides a good example of a business-outcome-based engagement. There is also a co-innovation angle to this relationship where HP and the client will co-develop and co-market solutions for governments globally. It is an interesting example of how HP should structure its engagement model when engaging business stakeholders in Asia.
- New IP based solutions that are relevant to the business. HP has a number of IP industry solutions in the travel, transportation and healthcare sectors among others. While there are nuggets of goodness in parts of the ES organization across Asia Pacific a clear IP-led strategy is currently missing. Addressing this gap is critical for HP to deliver value to AP business decision makers.
Overall, HP has re-established itself as a “safe pair of hands” for IT environments in Asia Pacific. However, business technology is still not the company’s forte. If HP does not clearly outline its blue ocean strategy soon in AP, I believe its “New Style of IT” offering will remain stuck in the red ocean. If that happens, HP will not only miss out on significant growth opportunities, but will also face an increasing risk of becoming irrelevant to business-led projects, which are the true drivers of competitive advantage for AP-based organizations.