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Feb 2017 - Market Note - Doc # AP42234817

Leading with Digital Transformation: Views from the BMC 2016 APJ Analyst Forum

Authors: Anastasia Antonova, Sabharinath Balasubramanian, Chris Zhang, Glen Duncan, Linus Lai, Lydie Virollet

BMC announced its "fastest quarterly product revenue growth in over 18 quarters." Its global footprint now boasts of a partner ecosystem of over 300 companies, with Telstra, Fujitsu, and Accenture being key partners within APJ. Its list of logos worldwide includes over 10,000 organisations — 82% of the Fortune 500 companies highlight BMC's heritage in this space. Product innovation remains fundamental to BMC with R&D investment currently at US$8 billion and patents (granted or pending) numbering more than 470.

BMC, which has traditionally assisted its customers to manage and operate their ICT infrastructure, is now vying to be the end-to-end management platform of choice extending to mobile and IoT applications. As such, this year, the BMC Engage Asia Pacific event showed a different profile of BMC, one of a company focusing on providing industry and business-based solutions from the platform to application development with the aim to assist its clients in their journey to become digital enterprises. To do so, the company is undertaking seven customer initiatives: agile applications delivery, big data, multisource cloud, digital workplace, IT optimisation, service management excellence, and security operations (SecOps).

The Asia Pacific business unit has undergone its own specific transformation journey. The initial phase of this journey — now complete — has involved five activities designed to accelerate geographic expansion and strengthen the overall business: 1) Communicating strategic priorities, 2) AP quarterly cadence rollout, 3) Increased focus on sales execution and methodology, 4) Sales management training, and 5) Country engagement. The business unit has now commenced phase 2 to drive customer success through accelerating "in geo" leadership expansion and ecosystem leadership and collaboration.

This transformation involved cultural, behavioral, and organisational design changes. The company acknowledged that its old culture was that of an engineering company that produced great products with great demonstrations. Employee attrition had been significantly above the industry average but is now reported as being below. BMC announced that it is now "on Forbes' best employers list." The strongest evidence for BMC's overall internal change was its messaging around customer engagement transformation, where it claimed to have had a paradigm shift on sales and pre-sales. This involved a three-pronged approach of segmentation alignment, customer engagement, and ecosystem support. BMC's sales processes are evolving from product-based selling to solution selling to a values-based approach.

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