Unlocking Value From Gartner’s Critical Capabilities Report for SAM Managed Services

Kris Johnson:

Hello and welcome to another episode of the ITAM Executive podcast. I’m Kris Johnson, chief product officer at Anglepoint. With me here today is Scott Hair.

Scott is our lead solution architect who works a lot behind the scenes and with clients to put together the right mix of services that are going to drive the greatest value. And we thought we’d talk today about the Gartner Critical Capabilities Report that just dropped recently, which you can now find on Anglepoint’s website.

We’ll put a link for you so you can find that easily.

And we thought we’d talk a little bit about what the Critical Capabilities Report is, how it differs from the Magic Quadrant, what things to look for there, and have some context around it so it can be as useful a tool to you as possible.

Scott Hair:

So Kris, to get started today, I think it’s worthwhile to spend a few minutes to talk about, you know, what is this Critical Capabilities report?

Kris Johnson:

Yeah. A lot of people, I think, don’t realize how it differs from the Magic Quadrant.

The Magic Quadrant, of course, its hallmark is that two-by-two matrix of you know, vision versus capability. And, you know, plotting, Leaders and the other quadrants within that the Critical Capabilities is an input to that analysis, but is treated specifically along three specific use cases for the Critical Capabilities report.

Those three use cases are as Gartner defines them for complete software and cloud SAM services, hybrid software and cloud SAM services, and then finally scheduled software and cloud SAM services. And they have definitions for those, basically the first one being continuous, you know, sort of holistic outsourcing.

The second one being a hybrid. So, a mix of you know, an organization retaining some resources and doing some of the activities of a sustainable SAM program alongside a managed services provider and then finally, scheduled resources are not ongoing it’s more point-in-time projects. And so, that’s how they differentiate those three.

And there’s nine or ten actual critical capabilities. I believe there’s nine this year. And those range from like Process and Transformation Services, Managed Trustworthy Data Services, Managed Entitlement, FinOps and Cloud License Management, Governance and Optimization Actions, Integrated Lifecycle Management, Continuous Delivery Platform, which was new this year, Value Realization, and Environmental Sustainability Services, which was also new this year.

The third one that was new this year was Value Realization. So different from years past, those 3 were included and specifically focused on this year. Coming back to, you know, the differences and why somebody would want to read the Critical Capabilities report, as you can see for each of those use cases along those nine critical capabilities, how different managed services providers rank and score along those areas.

Scott Hair:

So, what I’m hearing is that the pretty two-by-two matrix, right? Of the Magic Quadrant that it’s probably the most visible aspect. This is how Gartner gets to those conclusions.

Kris Johnson:

Part of it. Those decisions. Yeah. There are other things about vision and ability to execute specific to the magic quadrant.

But the critical capabilities gets really into the nitty gritty of, you know, examples of actual deliverables. You know, not just methodology, which would be more on the vision side or ability to execute, you know, how we’re structured as a managed service provider you know, where we’re offering services from a geographic standpoint, you know, so ability to execute services.

This is the actual services themselves and the quality. delivery of those services if you will.

Scott Hair:

So not going too deep into that, one other major element that I have found was surprising to some of the organizations that I work with is there’s also weighting based on customer feedback experience that organizations have had working with Anglepoint and the other service providers, and that weighs heavily into rankings as well. So it’s not just the numbers of it or the ratings, but it’s real life.

Kris Johnson:

Yeah, so it’s a combination of the materials that you know, the subject of the research submits, you know, the deliverable examples and so forth, but it’s also, you know, Gartner hearing sort of the voice of the client through the Gartner Peer Insights platform where our clients and others go and, you know, do ratings and write ups.

How many stars out of five, right? So, yeah, the critical capabilities, you know, if I were to put a finer point on it, think of the magic quadrant as, you know, it’s, it’s vision and ability to execute.

So, you may have great vision that aligns with Gartner. You may have a good ability to execute as an organization, but what are you executing and how good is what you’re executing? Right? That’s where the critical capabilities come in. The quality of what is being delivered as a managed service, not just your ability to deliver it or your vision, but the quality,

Scott Hair:

This is interesting. So, one of the things that I spent a lot of my time with is working with organizations that are that have issued a request for proposal or an RFP. They’re trying to evaluate and bring in a service provider that can really help them mature their program. In some cases, they’re starting from scratch.

In other cases, right? They’re looking to supplement key areas or critical areas of their internal capabilities, right? And with that perspective, I would think this would help an organization to make better decisions with regards to who to work with or who has strengths and in key areas for sure. What other areas or how else would you see organizations leveraging this report like in everyday kind of usage?

Kris Johnson:

Yeah. I mean, as you mentioned, it’s a great starting point for who to evaluate as a potential bidder or somebody who would like to an RFP. I love the detail that it gets into.

And so, you know, every managed service provider is going to have strengths and weaknesses. And when, you know, if somebody is looking to you select a managed services provider, they get into an RFP scenario, maybe they’ve down selected and it comes to that orals presentation and question and answer and really trying to understand that provider you know, I would want to, if I was selecting a managed services provider, I would want to read this and find out kind of where Gartner assesses some strengths and weaknesses.

And just like in an interview with if you’re hiring for a position, I would want to probe in those areas. Like, tell me about this area that maybe Gartner assessed you as weaker on, or tell me about this area where Gartner may have assessed you as stronger on vis a vis the other bidders, right?

So, I think it helps to get to better questions, to get better differentiation in that orals process, once they’ve down selected.

Scott Hair:

You know, the other thing that’s interesting again, part of my role seeing a lot of different RFPs from different organizations, you can imagine there’s a broad range of questions and scope and in areas.

I would also think that this starts to in some ways educate organizations right on what is possible because in some cases they may view a service provider coming in to plug a very specific hole or, you know, to address a gap in capabilities, but this I think also can help organizations kind of elevate their understanding of what a service provider perhaps could bring to the table. I don’t know how you feel about this, but sometimes I think when we get into organizations, there’s a lot more that we could do.

Our perspective is unique in that we see so many different organizations on where they struggle whether it be gaps of skill sets or tools or, you know, experience. But when we get in there, sometimes we see a bigger picture of where we really could drive meaningful change and value.

But I think sometimes organizations don’t understand the possible.

Kris Johnson:

Yeah, it’s a fair point. Just as when an organization is selecting a technology, a SAM platform, or it could be any tool within IT for that matter. It’s always good to have a very solid, robust grasp and documentation of your requirements.

And then you look at tools that are going to best meet those requirements. As opposed to okay, find the prettiest, shiniest tool out there and then try and map that back to what you think your requirements may have been, right? Same with a services provider. You want to know what your requirements are as best as you can identify them and then try and match that to the capabilities including through the Critical Capabilities report those managed services providers that are going to best meet those requirements.

But to your point, it’s also good to keep an open mind that you’re trying to hire the best experts in this field that do this every day, they may have some input into where your focus might be better attuned to drive greater value, drive greater results, help define what success looks like within your organization so that you can make sure that you mutually achieve that success together.

Because sometimes there can be a little bit of somewhat tunnel vision on the part of that organization because they only know their organization. They only know their problems versus the broader perspective that a managed services provider should be bringing to the table.

Scott Hair:

So, one other thought on this.

So, you and I have been in this ITAM and SAM space for a lot of years and you and I go back, I think, 20 plus years now. Yeah. We’ve seen a lot of evolution and change, obviously from there’s a lot more grey up here. That’s right. It’s earned. But uh, there has been a lot of, I would say evolution of the discipline for software asset management over the years.

How do you see this Critical Capabilities? Obviously, this is now what, four years in the making. How do you see this evolving and changing? And was there anything that jumped out at you with this particular year that you felt was noteworthy with regards to kind of that evolution?

Kris Johnson:

Well, the addition of the 3 new critical capabilities. So, the continuous delivery platform, Gartner’s recognize that there is a need for a managed services provider to bring a delivery platform of some sort to supplement, augment, commercial tool functionality this is the Elevate platform in our case that isn’t trying to compete with those commercial tools, but it’s the hub.

It’s the delivery hub for the managed service, you know, in terms of project management, communication, distribution of procedures, collection of some information that tools don’t get and processing of that, et cetera.

Scott Hair:

So, a lot of times when we’re talking with organizations about using Elevate, they’ll say we have tool X, right? Or we’ve already invested in that.

So maybe to clarify a little bit more is Elevate repetitive or duplicative to other tools? You kind of talked about how it’d be more of a centralized hub. Maybe give a good example of how it’s different and how it’s not either or, but it’s really both.

Kris Johnson:

So, a good SAM platform Is going to help bring in inventory data, right?

Be an entitlement repository, automate some of the reconciliation to a compliance position or an effective license position, depending on the product mix, right? They’re not 100 percent solutions for all publishers, as you very well know. But those tools don’t tell you what you need to do when you need to do it to manage that tool or manage your program.

Or manage your stakeholders, right? So, Elevate fills that gap, right? It’s not even something that commercial tools are trying to fulfill. So, it’s, the who does what by when within the program, some of those tasks are going to use the tool to do X, Y, Z on this basis, right? So, it’s sort of a wrapper around the tool, but the managed service in general and it also gets into some of the areas where.

You know, just as we mentioned, there’s some products of some publishers that those tools by the nature of the products themselves are not very discoverable, for example. And so, there’s supplemental procedures that a good managed services provider is going to come with to be able to get at consumption level data necessary to identify license consumption for particular products that fall outside of kind of what the mainstream tools are able to do.

Scott Hair:

In my opinion, this sort of engagement management layer, right? Is the coordination, the planning, the supplemental activities, the communication. I know we use this for everything from being able to present data to securely transfer data to provide status reports and everything else in a secure manner.

Kris Johnson:

As you alluded to, sometimes we hear from clients that oh, they have a SAM tool, they don’t want to use Elevate, but you know, this is really for their benefit, right? This is to cut down on a lot of unnecessary email and meetings and strain on the organization.

And so Gartner recognizes that a managed services provider, if they’re going to be market leading, has to come with this capability. So, it’s very disheartening when some organizations don’t want to hear about it.

Because it saves them time, saves us time.

Scott Hair:

So, we were talking about some of the new capabilities here. So, the first one is you talked about is that delivery platform. What’s the next?

Kris Johnson:

Yeah. Value realization was another critical capability that the Gartner added this year. And this is really Gartner helping focus on outcomes. You know, reports and data are all fine and good, but what did the service ultimately achieve from a value realization standpoint, which can be mitigated risk, but also, you know, costs taken out of contracts efficiency gained from transformation of a process those sorts of things.

So, it’s a good addition to make sure that we’re focusing on the impact of the services.

Scott Hair:

So, you use the term I want to touch on the term outcomes. So, I think Anglepoint internally, we’ve had to go through kind of a culture change, right? A lot of times we would talk about with a service, we would talk about what are the deliverables that we’re providing to a customer.

And I know over the last couple of years, we’ve worked hard to make sure that, top to bottom within the organization, left to right, everyone is speaking. outcomes. Can you clarify a little bit what that means to a customer?

Kris Johnson:

A lot of deliverables take the form of a document of some sort a report, a PowerPoint, right? An Excel spreadsheet, even but those documents, those deliverables are usually means to an end. Well, what is the end goal, right?

We’re trying to achieve an outcome, whether that’s efficiency within a process, or we actually want to reduce compliance risk, or we actually want to reduce waste money that’s being spent on software that’s not needed and the tricky part comes when a managed services provider standpoint is what we don’t always have control over the end to end part of achieving that outcome, right? We’re not negotiating on their behalf but what we found is that it’s not enough for us to, you know, just provide documents, we’re getting a lot more hands-on and insisting that we get more hands-on.

Even when our clients are saying, no, no, no, we’ve got the deliverables. We’ve got the license position now we’ll go and do, or we’ve got the governance structure from you and you know, how a steering committee should operate, we will now go and, you know, implement that steering committee in those processes.

What we find is that the implementation is hard. It’s hard for organizations to do internally. And we’re taking on a more proactive role to manage remediation. For example, no, we’re not hands on the keyboard to move those server operating system instances to different clusters to reduce the license consumption and therefore, you know, reduce what you would need to renew.

We’re not hands on the keyboard, but we are providing what we call remediation management services to do that follow up to drive a system of accountability to those application owners that have a responsibility to make those changes and put it within a governance structure where there’s an escalation protocol.

There’s a policy in place that if they don’t take action by a certain date. There’s certain consequences and escalations and so forth, creating that system of accountability so that the outcomes actually get achieved. And same thing with governance administration. So, this is where we get hands-on as the administrator or like the secretary, if you will, of the steering committee.

To prepare the agendas, prepare the pre read materials, train steering committee members on the roles and responsibilities, take the votes, communicate out the votes a steering committee should be voting on policy and budget and things like this but we find that unless we take that hands-on approach best practice doesn’t just happen magically, even though they know what best practice is, you know, we’re providing that to them when rubber hits the road.

Oftentimes they’re very uncomfortable doing that themselves, or there’s just other hotter fires. And so, this is where we’re providing that sort of end-to-end, you know, governance, administration, the license management services, but also remediation management as an escalation path back to the steering committee so yeah, that’s a recent change. I’m glad you mentioned that we’ve put in place in the last couple of years. To really drive the realization of value through those outcomes,

Scott Hair:

You know, years ago, I can remember I’m going to use the industry term ELP and effective license position and, you know, going back a number of years, you know, we used to be so proud of those ELP reports, right?

Those workbooks, you know, our heart and soul and sweat and blood went into making that fantastic.

Kris Johnson:

Clearly, it’s valuable to anyone. Right?

Scott Hair:

It’s obvious, right? Yeah. So, I can remember, though, and one of the, I would say, most frustrating things as a service provider is when you genuinely do good work, your analysis is spot on, you’ve done the due diligence, you know, you’ve done it right.

And you provide these analytics, the report, the data, and then it kind of nothing ever happens, and that was always so frustrating. And so I’m glad to see that Gartner is now, I would say, emphasizing this because this has been a big emphasis for Anglepoint for years is the so what? What does this data mean?

And what do you do with it?

Kris Johnson:

Yeah, and now in the critical capabilities report, you can see differentiation between managed services providers on that exact point.

Yeah, the last one that was added. The third one is environmental sustainability services this gets into green ops or green IT so looking at the impact to carbon consumption that the IT environment has, and you know some people might say, well, what does that have to do with software asset management?

The truth is, is that the software asset manager or IT asset management function is probably best poised within the organization to provide that level of reporting And so it’s good to see that emphasis it’s still a bit early days from an industry standpoint. You know, there’s not a lot of clients or organizations out there that have kind of clued into the value of it, although it is very much picking up certainly in Europe with recent legislation pending changes to SEC reporting requirements here in the United States.

And so, Gartner’s very well knowing that this is quickly gaining traction with a lot of organizations. But we’re still in sort of the early phase of that.

Scott Hair:

So, talking to our ITAM executives, right, to be able to report and provide visibility, what’s a good example of how they might be supporting some of the reporting requirements?

Kris Johnson:

Well, IT, amongst other business functions, has one of the largest footprints, if you will, for consuming carbon and having greenhouse gas emissions. So, for the IT manager, that’s already getting good data around what the IT infrastructure looks like from a hardware asset management standpoint, especially looking at the make and model numbers and types of processes that are in use.

Monitoring, you know, process utilization to be able to approximate what the electricity usage is and calculating that into greenhouse gas emissions based on where they’re sourcing their electricity from their cooling, et cetera. There’s also elements of recommendations that the ITAM function or SAM function should hopefully be getting from a managed services provider, if not themselves is what is, you know, when we talk about license optimization and some of that might be from a bring your own license standpoint for workloads that are in the cloud, some of the transformation or the lift and shift operations moving on premises workloads to the cloud.

That’s one of the most green actions that a CIO could make because of the inherent efficiency gain that you get from moving workloads to the cloud.

So, you got a lot of electricity that you’re paying to run servers that you’re not getting productive use out of versus in the cloud those processes are fully utilized for the most part. And so, the electricity consumption, you know it’s much better in the cloud.

Scott Hair:

So, Kris, we’ve had a lot of good discussion here. There’s a lot of great material.

If you haven’t read this, you know, for those listening, I encourage you to take a few minutes and go through the content. It’s worth blocking an hour and really thinking about how this applies to your organization. But Kris. last thoughts on this?

Kris Johnson:

Yeah, you know, to your point earlier how an organization should look at the critical capabilities report, you can also look at it from a best practices standpoint, look at these critical capabilities, even if you don’t use a managed services provider, ask yourself, does your program deliver these critical capabilities?

And if not, you’re probably missing something on the horizon that you should like environmental sustainability reporting. And you can kind of evaluate yourself, maybe like rank yourself. There’s some pretty granular criteria in there that you can read. How would you rank your internal program vis a vis these providers?

And if you find that there’s a lot of holes, maybe you should be thinking about a hybrid service to round out the capabilities of your own internal team. We’ve talked quite a bit about how the Critical Capabilities report compares to the Magic Quadrant report.

If you haven’t had a chance to listen to the podcast episode on the Magic Quadrant you know, what that process looks like we’ll provide a link to that as well as a link to a more focused conversation on the green IT and Green Ops where we dive into further details there.

But. Yeah. Thanks, Scott. It was great to get together and always a pleasure to come together and talk about these things and hopefully it’s been useful for our audience as well.