User groups are not just a way to influence suppliers, they can be a valuable source of information and support. Danny Bradbury reports.
An effective user group can work wonders in helping firms form better relationships with their IT suppliers, especially for a small and medium-sized enterprises. But to get the most out of membership requires effort by both users and suppliers.
According to Gartner analyst Betsy Bartson, user groups break down into three main categories. The first type of group is completely autonomous from the supplier, keeping interaction to a minimum. The second type retains its independence, but will invite the supplier company to get involved, presenting at events for example.
The final type of group is wholly supplier sponsored, reflecting the supplier's own agenda and sometimes limiting involvement to larger users. Each have their own strengths and weaknesses, Bartson says.
The first, completely autonomous type of group, often emerges from a grass roots movement, commonly at a regional level, says Bartson. It might be hosted by a consultancy or reseller without any direct sponsorship from the supplier.
"It is typically a way for users to get together and learn best practices from other users, so it tends to be a more tactical, granular and technical group that gets together to work on a common issue," she says. Open source enthusiasts generally fall into this area. "It is the only group that we still use the term 'community' for," says Bartson.
At the other end of the spectrum, the supplier-sponsored groups are sometimes not called user groups at all. Dave Chalmers, business development director at business software supplier Macro 4, prefers the term "customer advisory group". About 25 middle or senior managers from 15 organisations will be invited by the supplier to attend meetings and provide product feedback.
Chalmers prefers this model because of the lower cost and more intimate involvement. "Traditional user group meetings were expensive and when marketing money dried up, no one could justify the value.
"In our more controlled environment, the trust level is higher and that is the big difference. The attendees trust that they are being given valuable and relevant information, and the supplier is more open and trusts them enough to share more detailed plans."
However, Bartson warns users to tread carefully with such initiatives. "These can be influential groups, but the messages are driven, defined and controlled by the supplier. So it is harder for you to have a high level of influence," she says.
Some of the organisations attending Macro 4's sessions are not even users - they are sales prospects - which clearly helps the supplier with targeting product development, but may add little in the way of experience that could be useful to existing users.
Responding to this point, Chalmers points out that user group companies can use their own web logs to voice their concerns, and the supplier uses the web to contact the broader user base regularly.
User groups occupying the middle ground, setting their own agenda but maintaining links with the supplier are often the most powerful, says Bartson. The DB2 User Group and the Oracle Application User Group are good examples of this, she says.
"These are very powerful because the group gets together independently and tries to influence the supplier, so the whole goal is to share best practices and help drive supplier direction." By maintaining links with the supplier but setting their own agenda, they can hold the company to account.
Users who are members of such groups will find safety in numbers. The larger the user group, the more the supplier will have to listen to it. It can also enable smaller companies to be heard along with the blue chip users, says Bartson.
Such autonomy is all very well but these groups are not directly funded by the supplier, and smaller user groups trying to establish a foothold can find it difficult to do so without the supplier's help.
Phil Palmer, who works at construction firm HBG, is helping to form a user group for Autodesk's Revit structural design tool. After a slow start due to a small user base in the UK, things are moving along, he says, but he relies heavily on Autodesk's help.
The supplier donated £1,000 towards the creation of the user group's website and provided meeting facilities. Now Palmer is courting the company for a list of UK Revit users.
"One of the issues is that the supplier is not particularly keen on handing out the list of UK licensees. We are trying to get a list that we can then e-mail out to the UK users," he says. Autodesk was also initially against the user group bringing in its resellers, says Palmer, in case a competition issue should emerge between channel partners. However, Palmer says the company has become a lot more positive.
One of the biggest challenges for individuals organising a user group is finding the time to make it happen, says Palmer. Organising venues and event schedules is a particularly time consuming task, he says, adding that Autodesk also helps with this.
So why do it? And why attend these user groups at all? The bottom line is that as a product or supplier becomes strategically important to your company, you cannot afford not to monitor what it is doing.
"Frankly, if a chief executive does a keynote speech and they do not talk about a product that is critical to my business, that is an issue," says Bartson.
This is the reason Sharon Reason, commercial manager for HBOS Procurement, attends user group meetings for datawarehouse supplier Kalido. However, managers increasingly have to justify days spent out of the office. "It is more key nowadays to be seen not to be going out of the office on some sort of jolly," she says.
User group members need to bring back something tangible. In Reason's case, it was reams of notes, gathered over a couple of days of serious networking.
"We were looking at where we were going to go with the product," says Reason, explaining that ongoing internal developments in HBOS Procurement call for a close examination of its software strategy. "I needed to come back with a clear idea in my mind of where the company was going from first-hand experience."
For Rodney Jones, IT manager at Heygates flour millers, the Developer's Group has been similarly useful, but at a more practical level. The group, which was originally an autonomous developer's group for Borland's Delphi software development tool, became the Developer Group when it began expanding its meetings to include Microsoft developers.
Because there are so few flour millers in the UK, off-the-shelf applications for that market are rare, so Jones used Delphi to write his applications.
"The Developers Group gave me an advantage. I could listen and talk, and get that feeling of comfort. I have a few people's phone numbers. I could call people if I got stuck," he says.
However, Jones says he finds the Developers Group less useful these days because he can get all the information that he needs from the subscription-based Microsoft Developer Network. Consequently, he attends fewer meetings.
With Borland being increasingly challenged by Microsoft's developer tools. The user group provides a good way for the company to keep users loyal to its own products. Jason Vokes, European product line manager for Delphi, says he regularly speaks at the Developers Group and occasionally brings over a US representative.
However, the Developer Group's increasing emphasis on Microsoft and the lack of a dedicated Delphi user group illustrates the danger for the supplier of an autonomous user organisation: the lack of control.
Just as customer participation in a user group makes for smarter supplier management, so supplier management of its user group is crucial if it wants to maintain loyalty and build mindshare among its customers.
Without such a meeting of minds, users can lose track of supplier strategy and suppliers risk hemorrhaging users. It is best for everyone to keep themselves in the loop, even if it does mean a day or two out of the office every now and then.
Case study: Coda user gets involved
Tony Murphy, head of financial accounting at government-funded UK tourism promoter Visit Britain, has been a user of Coda accounting software since 1989. It was probably inevitable that the user group committee would ask him to be a member.
Murphy joined the user group committee two years ago and since then he has been involved in everything from negotiating with the supplier and organising social events to updating the group's website.
Before Murphy joined the committee, there was a separate user group for each platform that Coda's software covered. They have now amalgamated into a single Coda User Group, which he says improves communication between Coda and the members of the user base.
The user group is funded by member fees, paid in to an account administered by Coda. However, the group still controls its own funds, maintaining a treasurer who is a co-signatory of the account. A Coda employee acts as secretary and user group liaison.
The Coda User Group has a significant influence on product direction, says Murphy. It votes on suggested enhancements, which are then fed back to Coda. The supplier allocates a set number of developer days per year to the user group, which are used to help build what users identify as the most important enhancements into the product.
Murphy's advice to anyone wanting to become active in a user group is to examine and iron out time management issues at the outset.
The Coda User Group committee meets four or five times each year, and Murphy's other duties involve dealing with e-mails and talking to companies about how they can best use the product.
Murphy informally folds his user group duties in with his job. "It is time consuming, but I tend to say that my contract at work is for a number of hours, and I always do 10% to 20% more than those hours, so if I spent two or three hours a week doing this it is not a problem."