Wild Turkey update

Campari seems thrilled — if a bit startled — by the attention Mr. McConaughey has been lavishing on Wild Turkey, which the company bought for $575 million in 2009 and where it has since poured $100 million into operations upgrades.

Also, growth:

For the fiscal first quarter, which ended in March, domestic sales of Wild Turkey increased 7.6 percent from the same period a year earlier.

Source: McConaughey doing ads for Wild Turkey.

How Asset Managers Can Succeed with Advanced Analytics

A nice overview of what you’d use analytics fit in investing:

Armed with these advanced techniques, digitally forward asset managers can gain a significant information advantage over peers who rely mainly on traditional data sources and analytical practices. They can crunch through vast quantities of data; scour video and satellite imagery to gauge a retailer’s Black Friday prospects; extract insights from social media, texts, and e-mail to divine market sentiment; and parse a CEO’s comments during an earnings call to estimate the potential impact on the next quarter’s results. They can discern how unexpected weather disruptions might affect their portfolio, and even disprove long-held beliefs about how markets work. Smart, dynamic investment technology also helps managers assess their own performance to see whether they may be making the right decisions at the wrong times, buying too late, or listening to “influencers” who push them in the wrong direction.

There’s also a good overview of how to introduce new approaches like the above into the organization without it be Big Bang projects, likely to fail:

In experimenting with new technologies, firms should prioritize a small number of targeted initiatives that can deliver immediate tangible benefits in a focused, resource-­constrained way. In doing so, they should resist two temptations: the “esoteric science experiment,” whose focus is so narrow that the initiative can’t yield scalable results; and the “big bang rollout,” whose scope is so ambitious that it has a daunting price tag and takes too long to demonstrate value.

Source: How Asset Managers Can Succeed with Advanced Analytics

Working with legacy applications, systems, and portfolios

Elisabeth Greenbaum Kasson asked me recently for advice on working with legacy applications. Check out her piece on it. Here’s the full reply I sent to her in email:


Her topics:
– The steps someone could take to get themselves up to speed on their employer’s legacy software.
– How this knowledge can make them indispensable (I know that term is relative)
– Why this type of expertise is so necessary, especially when it comes to integrating said software with new and/or evolving products.

When it comes to “dealing with legacy,” there aren’t that many good options. We often think of “legacy” as software that must be changed but that we’re afraid to change. If you’re not afraid to change it, you often just think of it as “our software.” Legacy has this connotation of it being risky, scary, or maybe just boring.

If someone wants to go down into the mines of legacy management, the first thing I’d recommend is doing some history work to find out why the legacy system in question was created, what it’s currently used for, and, hopefully, who the current stake-holders/owners are. You’d be surprised – or maybe not! – how often some or all three of those are totally unknown: with unknown stake-holders, I sometimes hear tale stories of IT departments just shutting down systems and waiting to see who calls them.

Understanding the why, what, and who of a legacy system will tell you most of what you need to know when it comes to managing it. Further up the management chain, having a good grasp of and on portfolio management is valuable. Given the why, what, and who, you should be able to prioritize any given “legacy application” relative to another with respect to funding and attention. Is fixing the application that’s used to schedule office party birthday cake orders more important than the application used to re-order plungers for the warehouse bathrooms? You won’t know between cakes or plungers if you don’t do portfolio management.

The other aspect is simply learning the technologies you need – operationally, programming, and sometimes physical management – to keep the thing up and running and to modify it. This might mean learning, for example, about operating systems for mainframes, AS/400, UNIX, older versions of Windows, and sometimes even exotic things like OS/2. There’s dozens of programming languages out there, and you’ll need to learn not only the appropriate “old” language, but how the build, version control, and project management tools around those old stacks function.

For more, I wrote about dealing with legacy in my cloud native journey booklet last year.

To be effective, strategy needs living context

[T]he art of strategy based upon situational awareness remains one of those topics which are barely covered in business literature. The overwhelming majority depends upon alchemist tools such a story telling, meme copying and magic frameworks like SWOTs. It is slowly changing though and every day I come across encouraging signs.

Other than the “why don’t you tell me how you really think” tone there at the end (hey, I clearly have nothing wrong with that kind of dismissive style), that fits my experience working on strategy.

Your strategy team is forced to freeze time at the launch of the process, looking at their industry as an unchanging process (value chain diagrams, anyone?). As most strategy work takes 3-6 months at best (if not a year to year and half to fit into the corporate budget cycle and then get through The New Years hang over: no one really starts working again until February, then the business units have to plan, allocate budget, and execute), you’re behind: you’re looking at an understanding of the world that’s around a year out of date.

Worse than this, strategy teams are rarely given the tools (time, money, authority, and staff) to actually test out any theories, let alone learn from adapt the results of those tests. There’s no room for OODA/PDCA/lean startup, small batch thinking20.

Centralized strategy in a large company is weird in how unhelpful it can be for industries that are constantly changing or threatened by competitors. Like so many other corporate functions, the fix looks to be shortening the cycle time and getting as close to the actual work and customers as possible.

That’s a long way from the drab cubes of strategy drones and the luxurious double cubes with round tables of their bosses.

Source: What makes a map?

From toasters to clouds: ARM chips

Today, ARM Holdings is a $1.5 billion company with +15% year-to-year growth, nice financials (such as 96.7% gross margin), and a 46.7% operating margin….

15 billion ARM-based chips for $1.5 billion revenue means that, on average, ARM gets a licensing revenue of 10 cents per chip, and spends a little less than of half of that, 4.7 cents, to generate such revenue. It sure beats today’s Windows PC business and its measly 5% to 7% operating margins in the best of cases.

Source: A company that doesn’t really make chips dethroned Intel with super savvy business moves

Idera remains a stable of individual products

While large monitoring vendors like New Relic and AppDynamics are taking a platform approach, where they continue to add capabilities to a unified product, Idera’s strategy is to offer separate product lines.

If they look to expand beyond one or two products, most systems management companies end up being a collection of un-integrated products. It often makes more sense to do so as the products are used by different staff for different things. Also, most systems management companies are done through acquisitions, not organic development. Lacing in a framework of tools across Windows, Java, Linux, SaaS, and whatever else is tough.

It’d be cool if all that weren’t case for sure.

Nancy Gohring’s recent report on Idera also has a business update:

Idera has 20,000 paying customers and draws from a pool of over 60,000 users of its free offerings. Average selling price varies by product, ranging from $500,000 to $1m for Precise products, and about $10,000 for Idera SQL and Uptime Infrastructure Monitor. It expects revenue of roughly $100m this year.

Last chance to get $300 off SpringOne Platform

Next week is my company’s big conference, August 1st to 4th in Las Vegas. The agenda looks amazing, and it’s packed with good speakers. My primary interest, as always, is learning how orginizations are moving from older ways of doing software to newer, better ways. There’s a great line up of “manager types” talking about exactly that. There’s also endless coding talk, don’t worry.

Check out our recommendations for the conference in a recent Pivotal Conversations episode:

I’m going to try to interview people for the Lords of Computing podcast here and there as I find them. My lack of any real planning might ensnarl that, of course. On the other hand, locking people’s schedule down for a speaking at conference is next to impossible. That’s my excuse at least.

If you’re interested and haven’t registered yet, you can still (I assume!) use the code pivotal-cote-300 to get $300 off registration.

Hopefully I’ll see you there!

Talend IPO’s

The open source based data integration (basically, evolved ETL) company Talend IPO’ed this week. It’s a ten year old company, based on open source, with a huge French tie-in. Interesting all around. Here’s some details on them:

  • “1,300 customers include Air France, Citi, and General Electric.” That’s way up from 400 back in 2009, seven years ago.
  • In 2015 “Talend generated a total revenue of $76 million. Its subscription revenue grew 39% year over year, representing $62.7 million of the total. The company isn’t profitable: it reported a net loss of $22 million for 2015.”
  • “…much of that [loss] thanks to the $49 million it spent on sales and marketing,” according yo Julie Bort.
  • “Subscription revenue rose 27% to $63m while service fees stayed flat at $13m,” according to Matt Aslett.
  • It looks like the IPO performed well, up ~50% from the opening price.

TAM Time

By this point, I’m sure Talend messes around in other TAMs, but way back when I used to follow the business intelligence and big data market more closely, I recall that much of the growth – though small in TAM – was in ETL. People always like the gussy it up as “data integration”: sure thing, hoss.

That seems still be the case as spelled out a recent magic quadrant of the space (courtesy of the big dog in the space, Informatica):

Gartner estimates that the data integration tool market was worth approximately $2.4 billion in constant currency at the end of 2014, an increase of 6.9% from 2013. The growth rate is above the average for the enterprise software market as a whole, as data integration capability continues to be considered of critical importance for addressing the diversity of problems and emerging requirements. A projected five-year compound annual growth rate of approximately 7.7% will bring the total to more than $3.4 billion by 2019

In comparison, here’s the same from the 2011 MQ:

Gartner estimates that the data integration tools market amounted to $1.63 billion at the end of 2010, an increase of 20.5% from 2009. The market continues to demonstrate healthy growth, and we expect a year-on-year increase of approximately 15% in 2011. A projected five-year compound annual growth rate of approximately 11.4% will bring the total to $2.79 billion by 2015.

Meanwhile check out Carl Lehmann’s recent overview of Informatica and the general data integration market and Matt Aslett’s coverage of IPO plans back in June for a good overview of Talend.

ServiceNow getting momentum in new markets

We’re replacing people staring at spreadsheets all day long.

For a long time ServiceNow has been angling to move beyond it’s initial IT service desk market into new markets that use workflow management at their core. By “workflow management” I mean business processes that have a multistep, often multi-person process of solving some “problem.” Solving IT problems like password resets and on-boarding new employees fits here, but you can also imagine how HR departments would use it on-board new employees for their needs (adding benefits, pay, etc. all with approvals from various staff through-out).

At the last ServiceNow conference, they used drivers license renewal as a good example: there’s a request (I want a new drivers license or to renew one) and a workflow associated with it (verify the requester’s identity, check that they have car insurance, sundry other additional updates and integrations to the government systems, finally, submit some request to another workflow to print and mail a new drivers license).

You get the idea: at the core, there’s pretty much the same software to enable workflows. To grow the TAM they operating in and also their revenue by selling into these new use cases, ServiceNow has aspired to move into these markets for many years (maybe since around 2011 or 2012?).

Momentum expanding out of IT Service Desk

Here’s some recent momentum numbers on that front collected by Stuart Lauchlan and from the earnings transcript:

  • “Emerging products defined as, everything except ITSM, represented 40% of our net new ACV, up from 24% in Q2 2015.”
  • Customer service management: 40 customers, 31% G2,000.
  • Security operations: 32 customers. They recently acquired BrightPoint here.
  • HR: no numbers, but they signed a “$1.4 million HR-led deal for a new public sector customer in Australia.” This was through a Capgemini partnership.

In the most recent quarter, the company reported $341m in revenue, predicting it’d reach “$4 billion in revenue by 2020, a big leap from its $1 billion in 2015 sales.”