The third quarter of 2017 was unlike any in the recent years. The previous quarter looked pale in comparison to the earlier few, where numerous high dollar value (and unexpected) acquisitions grabbed headlines alongside protectionism measures that evoked mixed feelings. Nonetheless, there were key events unfolding in the background which have likely implications for IT category managers.
Lenovo revamped its data center strategy by launching a bevy of products covering the entire portfolio of storage, servers and networking devices, and signaled its ambition of becoming the top ranked supercomputing organization. The ThinkSystems product blitz is clearly targeted at displacing data center rivals and existing market leaders such as Dell EMC, Hewlett Packard Enterprises (HPE) and Cisco. With little doubt, Lenovo is likely to come up with aggressive pricing propositions in data center deals which will likely lead to further price cuts from the competition. Sourcing managers can use this opportunity to rake in savings through contract renegotiations.
Another big announcement in the third quarter came from Oracle which signaled an intent of expanding its footprint in cloud by refreshing and further bolstering its SaaS offerings. Oracle has already begun pushing its cloud offerings to its existing on-premises customers, alongside prospecting for fresh clients wooing them with exciting discounts and extreme flexibility. However, most software category leaders lack prior experience in sourcing Oracle’s cloud portfolio which brings its own set of unique challenges. Sourcing managers must equip themselves with the necessary negotiation strategies before initiating a sourcing exercise for Oracle SaaS offerings.
While decibel levels surrounding the events and trends wouldn’t match-up to the ones that unfolded in the last few quarters, these nonetheless have massive implications.
We have analyzed current trends in the IT and Automation category in our quarterly category bulletins, which can be yours for free for a limited time. Please reach out to Anup.Shetty@gep.com to grab your copy.