Strategic CIO // Executive Insights & Innovation
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3/18/2010
12:20 PM
Rob Preston
Rob Preston
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Down To Business: The Most Strategic Vendors, 11-20

One reader said my 1-10 list favored sales machines over true innovators. Point taken. This focuses less on size and more in impact.

In my recent column on the 10 most strategic IT vendors, I promised to follow with an 11-to-20 list. I'll get to that extended list shortly. Most readers had only quibbles with 1 through 10. IBM, most agreed, is the clear No. 1, based on the breadth and depth of its product portfolio and expertise. One longtime reader thinks SAP should be knocked down a few pegs from No. 2, based on its floundering under CEO Leo Apotheker, who recently stepped down.

Another thoughtful reader, from an IT consultancy that does work with CIOs, argued that some of the vendors I picked are more "embedded" than truly "strategic," as they're "sophisticated selling machines," not true innovators, spending two to three times as much on sales as on R&D. "The large IT suppliers are winning because they have placed the right bets on strategic selling, massive market consolidation, and the establishment of solution standards inside their customers' environment," the consultant argued. "This allows them to eliminate competition for spending and maximize revenue and profit from every deal." Although he mentioned only Oracle (No. 4) by name, Cisco (No. 5) and EMC (No. 9) also come to mind here. No doubt some strategic relationships are flawed and pricey.

Taking into account some of the reader feedback, what follows is the not-so-definitive list of the 11 through 20 most strategic IT vendors. Weigh in with your own thoughts.

11. Salesforce.com. Now a $1.3 billion company, Salesforce is more strategic as the leader of a movement, software as a service, than it is for its core business, SaaS-based CRM tools. Meantime, it has diversified into collaboration applications with its Chatter service, and its Force.com has become the leading development platform for a range of services-based business apps.

12. Dell. Barely missing the 1 through 10 cut was Dell, a company whose size alone ($60 billion in annual revenue) puts it into "strategic" consideration. As noted in my prior column, with big acquisitions in storage (EqualLogic) and services (Perot Systems), Dell is moving fast beyond its commodity PC and server businesses.

13. SAS Institute. SAS products are considered state of the art in one of the most strategic IT areas: business analytics. With customers in 119 countries, including 92 of the world's 100 largest companies, SAS helps banks, manufacturers, government agencies, healthcare providers, retailers, schools, and many others make more informed decisions. And as the only privately held company in our top 20, SAS also has the luxury of investing for the long term rather than the next quarter, spending 23% of its $2.3 billion in revenue on R&D.

14. Symantec and McAfee. One reader found it "somewhat surprising" that no security vendors made my top 10. "An indictment for being too often tool vendors and not solution providers?" he asked. Precisely. In security, there's no clear alpha vendor, and an assemblage of point products doesn't always make for a coherent suite. Nonetheless, most companies rely on Symantec or McAfee for at least some of their security, from basic antivirus to enterprise security information management.

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