CA Technologies outlines new strategy for growth

Roy Illsley, Principal Analyst, Ovum Software

CA Technologies held a global analyst symposium in January 2014 where it discussed its strategic intent for its full portfolio of capabilities and solutions. Ovum has selected what it believes to be the key messages from the symposium in two related markets where we believe CA Technologies has significant new business opportunities: project and portfolio management (PPM), and infrastructure management.

The market for infrastructure and enterprise management software is a competitive space dominated in the large global customer space (the global 2000) by a relatively small number of large vendors that supply comprehensive solutions. However, while these global customers have been a focus for the leading vendors, the solutions demanded have become more specific to customers’ needs, and the cost has increased accordingly. By contrast, the market for companies with annual revenues of $300m and above is served by a wide range of different vendors, and the model used is to offer standard, simplified solutions that can be delivered in many ways: SaaS, hosted, or on-premise. Ovum believes this sector of the market will be a sector of significant growth over the next few years.

CA Technologies must develop new skills if it is to win new business in what is currently a “white space” for its solutions

Traditionally, CA Technologies has served its global 2000 customers in a way that matches their specific needs. Its customer loyalty and renewal rates on enterprise license agreements (ELAs) are testament to this is. While this segment of the business is important, it represents a lower growth opportunity for CA Technologies because by definition the global 2000 provides a finite number of accounts. However, with the acquisition of Nimsoft, CA Technologies acquired a mid-market-focused company with a radically different approach to both marketing and cost to serve.

Michael Gregoire, the new CEO of CA Technologies, made a significant announcement at the analyst event. Effectively, CA Technologies has recognized that it must separate its sales organizations and compensate them differently if it wants to be successful in markets that represent new business. Gregoire was clear that serving the global 2000 customers remains an important part of the business, but also acknowledged that to grow the business further, it must win new customers in areas it has not traditionally served.

Ovum believes CA Technologies holds a pivotal position in the management market and agrees that better product classification and integration is needed, but also feels that the sales model employed must be separated between full-service customers and those requiring more standard off-the-shelf solutions.

CA Nimsoft Monitor Snap represents an example of exactly the new type of marketing and product development needed to win this new business. It is a freemium product that has all the key functionality of the CA Nimsoft Monitor product, and the same code base, but has a device limit of 30 before a customer must either upgrade or continue to use it for free on those 30 devices. CA Nimsoft Monitor Snap differs from existing CA Technologies products in a number of other ways. First, it has a brand image, a robot, and it makes extensive use of this in the marketing and messaging. Second, CA Nimsoft Monitor Snap product development has defined a set of criteria that must be met before any changes are made to the product. This is designed to stop product bloat and to ensure that it remains relevant to its target audience.

CA Clarity Playbook enhances decision support by linking strategic plans to investments and spend

At CA World 2013, CA Technologies announced its new CA Clarity Playbook solution designed for executives to enhance their strategic planning capabilities and drive better collaboration across key stakeholder teams.It allows executives to develop, refine, and allocate investments in the context of strategic plans and initiatives, while tracking execution across various projects against these plans directly from an iPad.Ovum believes this solution represents exactly the type of innovation needed if CA Technologies is to expand beyond the datacenter and increase its value proposition directly to executive decision-makers.

At the analyst symposium, a clear roadmap for CA Clarity Playbook was outlined, including building on the initial release and delivering enhancements in areas such as spend management (the latest release), with future efforts focused on capturing benefits realization including sourcing and connecting information from various systems of record.The vision is to connect strategic initiatives and investments directly to business outcomes.

The IT value movement is gaining momentum, and Ovum is keen to see CA Technologies take a leadership position in empowering the technology executives to become trusted partners to the business.CA Clarity Playbook has the potential to be a key enabler in this regard.

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