Crisis Management Is Changing
Boeing’s having a tough run. The company is under intense scrutiny after two crashes involving its 737 MAX jets, with governments grounding planes globally. This isn’t the first time Boeing planes have crashed — but PR-wise, it’s the worst. What’s different serves as caution for all leaders, regardless of industry. The zeitgeist has changed: No one is immune to the demands of empowered customers, not even B2B companies like Boeing. In Boeing’s case, the empowered customers are not just airlines but also the flying public. Historically, airline manufacturers didn’t interact with passengers post-crash but worked with regulators. A presidential tweet hurled the issue into the public realm, a virtual court whose norms disregard protocol. When Boeing tried to react with its typical PR playbook, its response was deemed slow and light on empathy, facets Boeing never had to worry about before. With Boeing as the new bad guy, airlines can raise summer prices, blaming the manufacturer, further angering a jittery public who are tweeting concerns. This downward spiral of brand crisis opened the door for a “Game of Thrones”-ish shareholders’ power play and a suit by Ralph Nader. Our research shows that crises such as Boeing’s are becoming inevitable and can only be managed with a modern approach that addresses all customers in the value chain — even ones you never needed to care about before.
Goodbye Martech, Hello Tech
On April 4, IBM announced plans to sell its marketing technology (martech) assets to investment management firm Centerbridge Partners. This agreement follows IBM’s announcement in late 2018 to sell several on-premises and single-tenant hosted technologies, including Unica, to IT services firm HCL Technologies in a separate deal. Together, these divestitures take IBM fully out of the martech landscape. Here is one reason why IBM may have sold out: Martech is a huge commitment. IBM’s decision provides further evidence of the substantial investments required to deliver martech innovation. It’s difficult — and expensive — to acquire martech components, assemble a viable enterprise marketing software suite (EMSS) portfolio, continuously develop best-in-class capabilities, and commercialize offerings in a crowded and competitive marketplace. To get the full take on the current state of the martech space, see Joe Stanhope and Rusty Warner’s blog post, IBM Sells Out — Another Marketing Cloud Bites The Dust. Another reason why IBM sold out? Well, IBM has been signaling different priorities for the past year. These moves have IBM focused on higher-growth areas in key technology areas, as evidenced by its blockbuster $34 billion acquisition of Red Hat in October 2018 and big moves in artificial intelligence, blockchain, cloud infrastructure, and its Global Services consulting capabilities. Look for Forrester’s upcoming research on tech-driven innovation to learn more about how companies will use technology to differentiate, and you will see how IBM wants to be a key partner helping them.
Moonshots, Literal And Figurative
After China’s successful moon landing earlier this year, the first-ever private company to build a spacecraft has it successfully orbiting the moon. While the Beresheet spacecraft, from SpaceIL, a startup out of Israel, didn’t successfully land on the moon, it marks a significant moment for space travel. The spacecraft was built by a team of less than 50 engineers and has made Israel the fourth country to touch the moon’s surface. In response to China, NASA has been partnering with SpaceX, Rocket Lab, and Fleet Space Technologies (the last two are from New Zealand) to engineer its return to the moon. All these moonshot efforts hold the potential to dramatically disrupt numerous industries and deliver new innovations across business and society. For more on the value of moonshots, join James Staten next week for his Forrester webinar on this topic.
Publicis Groupe Acquires Epsilon For $4.4 Billion
Last week, Publicis announced that it is acquiring marketing technology and services firm Epsilon for $4.4 billion. Publicis lacked data chops akin to other agency holding companies, such as IPG (via its Acxiom acquisition) or Dentsu Aegis Network (via its Merkle acquisition), so this deal fits well with the broader agency landscape. Publicis plans to put Epsilon at the core of its offerings; Epsilon’s proprietary first-party data assets will help Publicis scale its vision of people-based, data-driven marketing. In addition to Epsilon’s data capabilities, Publicis also acquired email, loyalty, and advertising technologies — what it does with these tools remains to be seen, and Wall Street is notably cautious about the deal. For more on this acquisition, read Fatemeh Khatibloo and Jay Pattisall’s blog post, Let’s Unpack The Latest Agency Acquisition — Epsilon + Publicis = ?
One of the most common failures we see in the digital era is a bad or incomplete implementation by a service provider without the experience or capacity to fulfill the mission. There’s something missing from your sourcing strategy: a deep understanding of how software vendors and service providers work and a collaborative process to choose them as a matched set of suppliers, rather than as separate decisions. The challenge is compounded by the lack of certification standards and the still-misaligned incentives of the parties. Get out ahead of this by asking the right questions to reveal the alignment or lack thereof.