Acadia’s ‘service’ model is presently Build-Operate-Transfer.  My question is, can (or will) the organization work to address the growing requirement for a Build-Operate-Manage model where the user is more reliant on partners to manage the growing complexity of their solutions?  The JV wasn’t formed with any intent towards becoming an outsourcer, but bringing a JV to market based on deep expertise and an ability to ensure architectural predominance for Acadia’s investors must make some form of ongoing ‘managed services‘ fairly appealing.  I look forward to what Acadia will bring to the market.

The challenge to creating MQ criteria is to make the field of vendors relevant to the greatest part of the market.  Generally we work to focus on providers that will openly bid, and service, mid size as well as large Enterprises.  Revenue is usually the most imposing impediment to entry for most providers.  I’d like to also apply a few filters to assure that we represent mid-market requirements and providers as well.

I’m offering the following criteria for your review.  One set is for the NA MQ and one set is for the WW MQ.  I’d love to hear your feedback and/or respond to requests for the rationale for the chosen (draft) criteria:

COPS MQ – North America

• In 2008, service providers recognized at least $200 million dollars in revenue in communications IT services. 
• Service provider competes for, and deliver, standalone COPS opportunities to address a growing need for communications selective sourcing.
• Service providers may not recognize more than 70 percent of COPS revenue from a single vertical market.
• Service providers must be able to demonstrate the ability to provides communications outsourcing services as a sole-source, direct provider (communications outsourcing delivered entirely by partners or subcontractors are excluded).
• Service providers must operate in at least 80 percent of the lower 48 states of the United States; and/or,
• Service providers must operate in 8 of the 10 provinces in Canada.
• Service providers must not recognize 80 percent, or more, of their revenue in a single business process or IT service category as the MQ seeks to exhibit broad value.

COPS MQ – Worldwide

• In 2008, service providers recognized at least $300 million dollars in revenue in communications IT services. 
• Service provider competes for, and deliver, standalone COPS opportunities to address a growing need for communications selective sourcing.
• Service providers may not recognize more than 70 percent of COPS revenue from a single vertical market.
• Service providers must be able to demonstrate the ability to provide communications outsourcing services as a sole-source, direct provider (communications outsourcing delivered entirely by partners or subcontractors are excluded).
• Service providers must operate in at least (4) of the (7) geographies tracked by Gartner.  The geographies are: Asia Pacific, Eastern Europe, Japan, Latin America, Middle East/Africa, North America and Western Europe.
• Service providers must not recognize 70 percent, or more, of their COPS revenue in a single geography as the MQ seeks to exhibit broad value.

A popular line of conventional wisdom emerging on the blogs and in the press is the possibility that Nortel be reinvented as an IT Services-led company.  Few companies have successfully managed that kind of transition.  There are a few network- and voice-OEMs currently working towards the same goal.  One example of success, particularly in the Americas, is NEC.  They’ve taken their lumps as a product company and really done a nice job creating a trusted, go-to organization to provide direct, or private-labeled, multi-vendor IT services to the market. 

The belief that Nortel can similarly reinvent the Company as an IT Services Provider is unrealistic. 

Nortel doesn’t have the bench strength to create, market, sell and deliver services for complex, multi-vendor environments.  The Services organization hasn’t been allowed to thrive and mature appropriately.  Nortel’s decades long recursive history of divestiture and re-investment in the Enterprise and Carrier services organizations is a case study for finger-in-the-wind management.  Of course, these mistakes are common in product-centric companies when they struggle to determine the strategic nature of Services. 

Compounding the problem, the Nortel’s services marketing organization only develops solutions appropriate for immediate plotting on the ‘Plateau of Productivity’ in Gartner’s Hype Cycles. Nortel services have consistently been devoid of innovation.  Most service products are released after Cisco and Avaya have brought them to market years earlier.  Subsequently, new service products are released into highly commoditized environments where no marketable differentiation is possible.  Additionally, the services marketing organization never appeared to actually market Nortel services. 

Gartner’s published Magic Quadrants and Vendor Rating documents have chronicled Nortel’s inconsistencies.  The Services organizations do not provide any foundational strength upon which ‘Nortel 2.0′ can be built.  The irony of course is that the IT services for Enterprise Communications will show good growth, relative to other industry segments, in a recessive economy.  Gartner’s inquiry requests from mid size and large companies looking at single-tower managed service/outsourcing projects are increasing.  Post-recessionary outlook for the market is even better as investments in Unified Communications are expected to show very strong growth.  IT Services is an important catalyst to facilitate market adoption and successful migration to Unified Communications.

If Nortel is going to survive as a Services-led company, then they will require a massive re-evaluation of executive and marketing talent charged to lead those services organizations.