Business Service Management Hub

The Hub Commentary_

I find this piece interesting for a couple of reasons.  The first being the application of technology to drive business and change the business, the second for the use of technology internally for productivity and the final interesting component are the comments that follow the article.

Most of the comments were not very positive, but they illustrated their point and opinion and created a conversation in a social media channel with the comment.  How we interact inside and outside our organizations is changing and will continue to change as new technologies arrive and they are applied in new and different ways.

I’ve noticed a change in many businesses I interact with in my personal life.  Many are becoming reachable, personable and are fostering the customer relationship more than ever before.  Some better than others and represent both small and very large organizations.    I’ve been surprised by those that are in touch with their customers and those that are not so in touch.

We all use the internet to read reviews, find product comparisons, provide feedback, ask questions, etc.  Why wouldn’t we expect the growth of social media channels and tools to grow exponentially in the coming years?  The companies that embrace, manage and exploit it will be the ones with the most loyal customers.

So what does this have to do with IT and BSM?  Our technology organizations must be leading the charge in applying new technology in our organizations both for productivity, but most importantly to drive competitive advantage and growth  Technology organizations as we know them today are transforming as business takes on the function of applying technology and driving innovation.  I suspect in the not so distant future we will have centers of innovation rather than IT organizations.

How are you applying social media channels and tools to drive your business?

Michele

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When Red Robin Gourmet Burgers introduced its new Tavern Double burger line last month, the company had to get everything right. So it turned to social media.  The 460-restaurant chain used an internal social network that resembles Facebook to teach its managers everything from the recipes to the best, fastest way to make them. Instead of mailing out spiral-bound books, getting feedback during executives’ sporadic store visits and taking six months to act on advice from the trenches, the network’s freewheeling discussion and video produced results in days.  (Read Full Article…)

The Hub Commentary_

I cannot pass on this article today.  Last Friday I closed the week with a bit of humor on Qmunity entitled, “Eat or be Eaten – IT Transformation Underway”.  As a long time application developer and once with EDS and IBM have often known the revenue is driven by the services and software side versus the hardware.  In fact, I once had the opportunity to work for an insurance company who received their first life insurance programs (ALIS – Advanced Life Insurance System) which was free when this company purchased it’s first mainframe hardware.  

As is called out in the article, the world is upside down these days and the device, HW just facilitates the real value add of the service.  As soon as the Kindle came out, I suspected the price would drop as it is more about the subscription than the device.  Much like Cloud services, provide an easy mechanism to purchase and hope no one monitors the consumption.  High transaction volume, low price point model.

Michele

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Lately I’ve been seeing a quote by Marc Andreessen everywhere. It states that “Software is eating the world” which he declared in an article for The Wall Street Journal last summer. His argument was that “more and more major businesses and industries are being run on software and delivered as online services.” Which I completely agree with. At the time he pointed to Hewlett-Packard as an example: It had announcemed that it was exploring jettisoning its struggling PC business in favor of investing more heavily in software, where it sees better potential for growth as a prime example of this trend.  (Read Full Article…)

The Hub Commentary_

Here is another industry under great change and a state with the foresight to attract and keep technology talent.  Again, I applaud the efforts of this woman, Vice President and CIO Mamatha Chamarthi, for having understanding and putting in place a strategy to right source the commodity and the high value stays in-house.

She is absolutely spot on with her strategy, it’s not that all of the technology function are going to the outsourcers and the cloud, it’s the commodity.  The internal roles are changing to apply technology for innovation in to grow the business.  This requires business knowledge and how to apply technology for innovation.  These roles and duties are unique to each organization and their strategies for growth.  These functions have never been a good target for an outsourcer unless the skill set does not exist in the organization to drive business innovation.

How are the roles in your organization adjusting to this great transformation of IT?

Michele

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Consumers Energy, a large utility in Michigan, has hired an offshore outsourcing firm to take over some of its IT operations. But instead of cutting its internal IT employees, it is retraining them for new types of work.  (Read Full Article…)

The Hub Commentary_

As a native Virginian, this is very positive news for the area in general from housing, jobs and quality of life.  The extension of incentives aligns with the growth of cloud providers and Amazon already has a stake in the Ashburn data center craze already.

I arrived back in this area during the dot.com bust and it was disheartening to see the number of empty buildings along the Dulles tech corridor.  Good to see the expansion and growth and the foresight to take advantage of this period of high tech growth in this region.

Michele

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Is it news to say that the data center business is booming in Ashburn, Virginia? Not exactly, as the town in Loudoun County has been a key connectivity hub since the early days of the Internet. But recent groundbreakings, facility openings and leases make it clear that Ashburn’s prominent place in the geography of the data center industry continues undiminished.  (Read Full Article…)

The Hub Commentary_

Outsourcing has never been for a cost saving measure.  You must manage the vendor and once in a service agreement, anything requested beyond the originally contracted service comes with a fee.  Let’s face it, additional services and service requirements begin to change as soon as the ink is dry and where the providers starts making their profit.

Cloud computing provides platforms, infrastructure and commons services, but affords flexibility to they buyer in the management of the services without owning the infrastructure or technology in place with the cloud provider.  This does put the ownership of service management on the contracting organization.

Cloud computing is disrupting the traditional outsourcing model as well as in-house IT organizations which drives innovation into organizations.  When properly instrumented and managed, organizations have much to gain in re-thinking their sourcing and IT infrastructure strategies.

Where are you with your sourcing and infrastructure strategy?

Michele

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For CIOs, the halcyon days of IT systems and architecture that were built and managed entirely in-house, or partly outsourced to a few mammoth vendors, are gone. In its place a hybrid model rises — one that maintains elements of the traditional IT foundation, but also takes advantage of new technology and platforms as they emerge.  (Read Full Article…)

The Hub Commentary_

As I began reading this article I thought there is a CIO in tune with her business.  R&D is the heart and soul of pharmaceutical companies and IT needs to work to drive business growth and cost saving in these days of transformation.  AstraZeneca is on the outside of the recent Fortune 500 list, but if innovation continues with this strategy in mind, I would expect to see growth out of them in the coming years.

I found the commentary interesting that follows the article.  Sales organizations have one and only one metric, are they selling and did they hit the number.  Sales professionals know this and while AZ may have lost members of the sales organization for a variety of reasons, I suspect, I applaude the Angela’s strategic thinking and confidence not to take a back seat in driving innovation into the organization with technology.

I ask, how are you driving innovation into your organization with technology?

Michele

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The strategic review undertaken each summer by pharmaceutical giant AstraZeneca acquired additional significance this year in the wake of a first quarter in which sales fell by 11%, to $7.3 billion, and earnings plummeted by 44%. Resultant investor criticism cost chief executive David Brennan and chairman Louis Schweitzer their jobs in recent weeks.  (Read Full Article…)

The Hub Commentary_

I’ve often written that you do not outsource for cost savings.  Cost savings can be achieved when right sourcing and giving up control, taking advantage of the economies of scale offered by a provider and allowing standard services (the commodity services of your organization) rather than custom services.

I find the commentary that follows the article interesting.  While I might agree that it may be an article for soft selling Google Cloud Services, you would be foolish to think any vendor doesn’t write to their strengths, but also wonder if some of the commentary comes from those IT organizations reluctant to change?

You don’t go the cloud just because you can, you right source it and must manage it accordingly and then you can spend your budget with the greatest gain.   In a CIO article today citing an MIS Quarterly study, for every dollar/employee invested in technology, twelve dollars/employee can be realized in sales gain.  The time for management and innovation investment is upon us and outsourcing the commodity.

How are you investing in the cloud?

Michele

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The economics of cloud computing are driving down the cost structure of business so far and so fast that it’s scary, Google CIO Ben Fried says.

“It deeply disturbed me … in 2006, 2007 consumer companies were forcing efficiencies on a scale never seen before,” Fried said Thursday during remarks at the Bloomberg Link Enterprise Technology Summit in New York.  (Read Full Article…)

I ended last week with a little tongue in cheek humor. I had started the week on a conference call on Monday and as I was looking out the window, a large bird came swooping past my window to land in a tree overlooking my patio.Curiosity of a Scorpion was getting the best of me to figure out what kind of big bird just landed so close. With a handy pair of binoculars I see it is a fairly large owl, that’s kinda cool, but what is it doing. It took a minute or two to discern what exactly it was doing, oh no it’s eating a mouse or rat. This provided my quote of the week, “Eat or be Eaten”.

I posted twice this week, IT and the CIO Fast Forward 5 Years – How Will You Get There? and IT Departments Need to Run Like IT Vendors and it seemed I couldn’t stop finding articles regarding the IT transformation:  (Read Full Article…)

The Hub Commentary_

Good Monday Morning!  Scanning the early news and came across this list of metrics from Forrester that they are building out for their next conference.  In the comments to the article, there is a link to the KPI Library.  

These IT metrics have been around for decades and are good for evaluating and implementing process improvements.  In this day of the Cloud and competition for IT business, I might suggest that these need to be in context of the service and could even go one step further and categorized for 4 high level services:  Growth, Quality, Productivity and Cost.

All services are not created equal and thus the metrics for each will vary based upon the priority of the service to the business.  I’ve posted here on this chart of services last week and in a previous post.  These metrics are suited for IT Operators, while the rest of IT is slowly being outsourced or moved to the business focusing on the services offered by the business and the services that will drive the business.

How do you measure your technology for the transformation that is underway?

Michele

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Help us build out a list of metrics that organizations are using to measure their infrastructure and operations departments. We will use this data to create a list of consensus metrics and benchmark their values.  (Read Full Article…)

The Hub Commentary_

Nice article regarding the transformation of IT.  I would disagree with the transformation being fueled by the consumerization of IT, but rather the competition that has come into play with the consumerization of IT.  This is the New IT as I call it in many of my posts.

Transformation is already happening and IT is already in the business and it is this competition from the outside presenting the business with options to get things done in a manner that IT has not been able to present services.  It is this competition and requirement to speak in terms of cost, value, right sourced deployment options, driving business growth, etc. that is the catalyst for change in IT.

Why does anyone do anything?  Because someone else is out there working to do it better and faster than the current supplier – competition for change.

The role of IT is no doubt changing and will be a manager of service and integrator of how those services are delivered to be effective in the future.

How is your IT Transforming?

Michele

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As technology becomes easier to use, it becomes more complex internally. That means IT is less necessary in some ways and more essential in others.

There is a paradox in the technology that IT employs and deploys. As it becomes easier to use and simpler to manage, it is actually increasing in complexity. And there is a paradox within this paradox concerning how IT relates to the business. More on that in a bit.  (Read Full Article…)

The Hub Commentary_

IT at the speed of Formula One.  I’ve been writing about transformation for quite a while now and having spent 15 years in Indianapolis, I developed an affection for racing.  It’s hard to develop that affection from TV, you have to see it live, walk through the pits and garages, smell the fuel and rubber, hear the sounds which vary by type of car, etc. to appreciate what goes into racing today.

As an old application developer, I have to say how cool a job it would be to be working with racing teams, on the other hand the pressure for IT and the systems to perform might be too much stress.  To the risk taker go the spoils!

Here is the best quote that concludes the article,  “If [IT changes] reduce the amount of manual work engineers have to do, they can focus on the car and driver,” he says. The team, meanwhile, prepares for the next two races in Spain and Monaco this month.  Maybe Lotus F1 will find that three seconds.

This is IT in tune with the customer and what tuning means to the business, the business happens to be very cool racing with very large payouts for the successful.  This is true in commercial business as well.  Business requires technology and technology is the life blood of competitiveness, growth and profitability.

How competitive is your IT?  Where does your Drive come from?

Michele

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Lotus F1’s IT team made a technology pit stop and changed from a traditional application development strategy to an agile approach. Why shift gears? The pit crew and car designer wanted better data faster — and IT wasn’t about to pass on the opportunity.   (Read Full Article…)

IT is in the midst of a great transformation and wrote about this in a previous blog as referenced by a CIO article and a Forrester blog.  For those of us who have been in and around IT for the past 20 years, we’ve seen this ebb and flow of change.  New technology, growth of service providers, decentralization and then back to centralization and cost containment.  It was desktop computing and LANs, web services and eCommerce and now it is the cloud.  This time is different though, the business is driving and creating the new IT.  There is competition and easier buying models that didn’t exist previously.  I will also state that outsourcing is not cheaper, it is creating the change that cannot be created from within – the new IT requirement.

In the previous post and CIO article, I mentioned IT needing to run more like the vendors they purchase technology from and marketing would become a key component.  Many think of IT marketing as marketing great technology services and uptime within the organization.  It is just this wrong kind of marketing that is driving the transformation for change.  Your business does not care about technology uptime, the business cares about driving out cost for profitability and driving up revenue for growth and profitability.  Marketing of IT has 3 facets:

• Know your services, their cost and value
• Know your competition and their capabilities
• Know the market requirements of your customers

This is a transformation where internal IT is already late for the dance and few possess the capability to enter the dance floor with a perfect tango balancing technical capability and innovative intrigue.  The competition knows this weaknesses and is capitalizing on it.  Technology vendors are also making the shift as to who the new buyers of technology and services are – the business and the service providers.  The difference between the technology vendors and IT is that the vendors are used to identifying markets, trends, shifts and making the adjustments required to capitalize on a market based upon the buyers and their requirements.

Know Your Services

Assess your current landscape of services and future services and where they fall into this simple grid.  This will help you to understand business drivers.  For example:  services for competitive advantage have little care for cost or quality, it is about speed to market.  In order to accomplish this, IT will require the flexibility to deploy with speed and mitigate cost and negative customer impact with controlled risk.  This is service enabling the infrastructure leveraging management technology to perform the monitoring and controlled risk, while the technologists apply the internal IP to the services with the right technology and right deployment options.

This will transform IT into the service managers that are developing in the business today with the underground New IT movement.  I would suggest that the model adopted by IT in their strategy to transform would be applying focus of time and resources as accordingly:

• 50% on services driving competitive advantage
• 30% on services for service quality and service efficiency
• 20% on services driving out operating cost

The competition is focused on addressing the requirement of competitive advantage in your business, this is ITs greatest weakness and the service provider / vendors greatest ability to drive value.  ITs marketing efforts must begin here in developing the holistic strategy of technology, deployment options, cost and value to the business.

Know the Competition

Developing a holistic strategy will include a multi-vendor and service provider approach.  Understand internal strengths, weaknesses and the outside capabilities to drive the highest value, lowest cost solution and deployment.  This would break the traditional cycle of change driven out of frustration to outsource, not value or cost.  Outsourcing is not the lowest cost option, but right sourcing to meet the right objectives to deploy the right solution is IT transforming into strategic.

The competition also has weaknesses in high growth times like these.  The strength of IT is operational focus, while both the providers and IT could benefit from a bit of operational maturity, now is the time to illustrate operational maturity with good management practices, processes and ability to communicate business value.  The service providers are investing in the communication, while taking a risk (controlled risk in some cases) on management in meeting a time to market requirement.  To meet the same time to market requirement within your organization, evaluating how you leverage management technology to automate your processes and provide the communication required for your business, would provide both competitive advantage and allow you to focus your IP on driving new services.

Know your Customers

Typically when you ask IT about their customers, they respond with their users and internal employees.  Here I am speaking about knowing the customers of your business.  Why do they select your company for your services?  What do you do better than your competition?  Who is the competition of your business?

Instead of working to control the environment so tightly and throw up obstacles and barriers to change and adoption of new technology and interactions with both the employees (Service Efficiency) and customers (Competitive Advantage), embrace them.  Understand how and why they seek to use specific devices, technology, methods of interaction, etc. and how to best deploy the right option.  This is understanding the requirement, not necessarily mimicking each and every device and method.  Provide the flexibility, while balancing control and risk.  This is most important when evaluating customer requirements and creating loyalty.

Think about who you prefer to do business with and why in your personal life and bring this into your IT organization to start the transformation revolution.  While I agree that marketing within your organization is relevant, marketing the right services and message will drive the greatest value in your organization.  This is dependent upon knowing your customers, requirements, competition and a focus shift from technology operators to communicating and driving revenue as service managers.

Do you know your services, customers and competition?

Michele

This past week Kim S. Nash, Senior Editor for CIO, publshed an insightful article, “Top CIOs Predict the Five-Year Future of the CIO”.  I’ll paraphrase a few of the key points that I jotted down and stuck out when I read through the article:

• CIO of the future will be an Entrepreneur, Futurist, Global Talent Scout, Connector, Master of Business Metrics
• CIO / CTO Split?  No support for this prediction and fractures the ability to manage / deploy technology and be a strategist
• Big Technology Trends – Cloud, Mobile, Social Media, Consumerization, Big Data, etc. will not change the role
• Manage change, Not Technology
• Set strategy, Not server thresholds
• Technology will change the way a company interacts with it’s customers
• CIO Effectiveness – He/She handles and sparks major business shifts
• Entrepreneur
  • In-house futurist, will be measured by financial measure, will run a business and market like the vendors they purchase from
  • Set aside technology and focus on business outcomes
• Connector and Futurist
  • Will foster partnership with the providers to his company to deliver joint solutions
  • How workers, consumers and suppliers will create competitive advantage
• Global Talent Scout
  • Roles will change from operators to managers
  • Location won’t matter
• Master of Business 
  • Responsible to create new products and attract new customers, new revenue and thus new accountability
  • Innovate

There has been a long standing initiative and talk in the press and analyst papers regarding IT being part of the business and not separate from the business.  However, according to the analysts, more than 90% of IT organizations remain reactive and disconnected from the business.  I would concur with this.  We all attend industry conferences and think about how you answer this question, “What do you do?”.  Most of the time when I ask it, the response is something like I manage servers, I manage UNIX servers, I administer databases, I manage the networks, etc.  Then I look at their badge, see who they work for and respond with, “Oh you sell insurance or investment banking or ……”.

Before I visit a customer, I do a quick read of their annual report, the letter from the CEO and peruse their website so that when I shake the first hand, I have a fair idea what powers their business.  I continue to be surprise by the number of IT technologists that do not know the business their own organization is in or what powers the business, thus setting the easiest to identify priority.  Technology without imagination is a commodity, Technology with imagination has endless possibilities, however, most of us act as mere commodity operators keeping the lights on.  Keeping the lights on carries an annual cost of 1-2% of revenue, the time has come to power the business and drive with technology.

According to a Gartner and Forbes survey of Board of Directors (BoD), 65% of BoD count on technology to drive competitive advantage for the business and according to IDC >50% of IT will be outsourced by 2013.  The role of IT must evolve and it has become an imperative with the advent of competition and new buying models.  Competition with the MSPs/ASPs/ISPs, Cloud, SaaS, etc. has arrived and why the business has the buying decisions and is choosing to outsource IT.  The time has come to transform and the catalyst is the competition.  Kim does a great job describing the role of the CIO and the new face of IT in 5 years.

As a previous analyst in the outsourcing market, I will tell you as I have told many customers, no one outsources for cost.  It is a perceived cost reduction.  What isn’t factored into the equation is 3-7% of the cost of the contract to manage the relationship and the service and keeping overspending in check.  Outsourcing occurs to create change in the environment that is near impossible to do from within.  I wait each day for the new Fortune 500 list to arrive and I will hold it to compare with next year’s list.  Those that make the transformation to power their business with technology will take leadership spots in their industry’s.

Now let’s talk about what it will take to make this transformation.  To achieve the things Kim speaks of, IT must first know what the business is; then how best to use technology to operate it, create competitive advantage, communicate and market results, proactively make real-time changes, and why customers engage to drive future strategy.

What is the Business

In most businesses to drive revenue, you evaluate why customers engage with your organization.  In this case, IT in most cases, doesn’t know the business or the services of the business.  Step 1 must be to understand the business and current services.  I’ve written a previous post on The BSM Hub describing how to categorize and know your services based upon their value to the organization.  This will define how you manage these services and the supporting technology.  All services are not created equal and thus knowing the services and their relevance to the business is the first step to transforming to Service Managers versus Service Operators.

Here is a true story.  I once spoke at a medium sized regional event on the topic of Service Value and managing services in the winter of 2009.  After I finished speaking a man approached me and indicated while the discussion was interesting, IT is not strategic to his organization.  I looked at his badge and noticed he worked for a candy manufacturer.  So my first question was to go after the life blood of the business, the manufacturing line of the candy.  “Does IT have anything to do with the manufacturing line?”, the response was “no”.  Second question, “I know you must have an ERP system, correct”, “why yes we do…….”.  “I venture to guess that sales and distribution to your customers is important business, right?”, “Why yes it is”.  Now he is standing taller.  I mention how in September 1999 Hershey made the front page of the Wallstreet Journal for the poor deployment of an ERP and CRM system costing them Halloween, Thanksgiving, Christmas, Valentines and most of Easter.  The lesson was that the public wasn’t as loyal to chocolate as they are to toothpaste and will buy what is on the shelves at the time.  “So managing and providing high availability of your sales, distribution and customer relationship management is critical to your business, wouldn’t you say?”.  He left with a different perspective than he came to the conversation with.

Companies are in the headlines everyday due to technology failures pointing out that if you do not know your business and what it costs you to be a mere operator, reacting to incidents, the press and the outsourcers will put  value on the situation.  The time has come to know the business, the services and their value and the supporting technology in order to manage it accordingly.

How Technology Supports the Business

Now that we know what the business is, let’s take a look at how the technology supports the business.  It is no longer sufficient to keep the lights on and manage all equipment the same.  Understanding the underlying infrastructure that supports the services defined above will change the way you manage the infrastructure.  Priority must be applied, not just severity of an event, business impact will be factored into the management of the technology.  Service enabled management in real-time must be applied, it is not a nice to have, but a must have.  Given the organization is wasting 1-2% of revenue annually, a service enabling management infrastructure is cheap and paid for before the first year is over.

Many management vendors speak of speed to root cause and speed to restoration.  This is still reactionary IT.   What is required is real-time, actionable intelligence to do something before a business impacting event occurs and avoid that business impacting event.  This now brings me to what many of the financial institutions already know, management is a mission critical service and requires high availability redundancy (as described in a post by my friend Tobin).  Don’t believe me?  So then I ask this question, “When flying on an airplane, do you want the pilot flying without instrumentation?, Then why would you run your business without instrumentation?”.

Now that you know the business and how your current technology maps to those services, it’s time to evaluate the best technologies and deployment options for the services and service enable them with management upfront, not as an afterthought.  Again, go back to the quadrant of services I described earlier.  Just because you have capability in-house to deliver commodity services, that isn’t generally the best choice.  Outsource the commodity.  Keep the competitive expertise in-house and evolve to manage services and put the proper instrumentation in place to service enable the infrastructure to mitigate risk, provided controlled risk for speed to market and provide the real-time actionable intelligence to make shifts on the fly to keep business running and creating quality customer experiences.

Why Customers Engage

Now that you have a grasp on today, let’s now use this new service enabled infrastructure to start creating the strategy to provide  stickiness with your customers, improve the customer experience with technology, creates competitive advantage and driving revenue.  This evaluation is 2 fold:  keeping current customers and gaining new customers.  Look at how customers want to do business with you, what devices they use, where and when they conduct business, etc. and often times creating a higher quality of service to maintain current customers will drive gaining new customers.

True innovation changes how an industry does business, think of eBay in the early days.  These sorts of transformations are rare, however, we are in the throws already of just this sort of transformation with how IT must revolutionize itself into the new IT.  Business is creating the new IT on it’s own by taking business folks with consumer technology knowledge and making the technology purchases in a decentralized manner.  Some call this “shadow IT”, I call it the “New IT”.  They are doing this because the current IT thinks more about managing and not enough about how to use the technology they are so good at running.

Running technology is the commodity, leveraging the IP in house to use technology to drive both revenue and competitive advantage is the new reality.  Now we’re back to where I started with my opening question, “What do you do for a living?”  Know your business, customers and how best to engage with them to drive your business.  Shift the focus of IT because the change is already happening all around us.

As I conclude on how to approach this transformation,  an interesting quote from Kim’s article by Nasir Khan, Executive Director of Infornetics at Blue Cross and Blue Shield Association, the administrator of 38 Blue Cross and Blue Shield health care providers covering 99M people, “Tactical reactionaries will be obsolete”.  This is why I look forward to comparing this years Fortune 500 list to next year’s as I fully expect that there will be a shake up at the top of many industries.  The shake up will occur because some make the transformation and do it rapidly and others remain as operators and commodity IT.

I do not want to leave you with the impression that the first two steps leave the business out.  Starting with Step 1, knowing the services and business, IT must engage with the business, start managing priorities and services as they power the business.  This cannot be an IT project.  The second step of mapping technology and deployment options to the services cannot become an inward IT CMDB project.  Yes, a CMDB does support this initiative, but it is about the services, not the project of creating IT documentation fondly called a CMDB.  Another ascertion I would make is that a CMDB project is of no value, but I’ll save the discussion as  to why for another post.  This transformation cannot be another IT project, it is a business transformation and those that succeed, will lead their industries in next year’s Fortune 500 list.

Investment must be made as a business investment that gives IT the management capability to manage services, manage providers, communicate real-time in business terms and use that management intelligence to drive competitive advantage both with new services and quality services that keep customers loyal.  Drive the cost out of the commodity and drive value  into the revenue.

How are you preparing for your transformation and service enabled infrastructure?

Michele

The Hub Commentary_

I enjoyed this read as an old mainframe programmer and operator.  I believe we’ve been talking about death to the mainframe for many years now and as my father used to tell people, “my daughter is working the midnight shift in one of those lights out datacenters”.

As the Cloud providers are growing exponentially and >50% of IT will be outsourced by 2013 according to IDC and business is making up to 50% of technology buying decisions the mainframe enters the conversation again.  Each time I see one of these statistics I say the same thing that Bill speaks of in his post, just because there is sexier technology doesn’t always mean it is fit for purpose or cheaper.

No one outsources for cost, outsourcing occurs to create change.  Business is frustrated at the obstacle IT has become when technology should be driving the business.  Technology is the core of the business, however, has drifted into the commodity zone like electricity.  Technology must power the business and make competitive advantage in the market place or these organizations will be left behind and fully outsourced.

With that said, now isn’t the time to change for the sake of change, but rather evaluate and make the right technology deployment choices  based upon the service and the business outcomes expected.  In my previous post regarding knowing your services, I provide a simple 2×2 grid in identifying the value of your services and then the evaluation of cost and deployment options.

I once had a manager tell me sometimes it isn’t always easier to re-write an application that works.  Of course I later discovered he had written the application I had targeted for a re-write as it was a bear to support as it was assembler and not only had “go to’s”, but branching on instruction lengths and register addresses.    We re-wrote it in COBOL without go to’s and it became easier to manage moving forward, however, there were a few sleepless nights wondering if we could prove out the re-write.  We dodged a bullet that time.

Know your services, their value and costs and then determine the best deployment option.

Who makes the technology decisions in your organization?  How is your mainframe these days?

Michele

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Let me be perfectly vague by intentionally withholding the names of two companies I want to tell you about.

Many years ago, I was approached by a large technology vendor that wanted to lure customers away from the mainframe. For several years, this vendor had successfully sold its proprietary midrange computer, so they decided to test the waters in the high-end market.   (Read Full Article…)

The Hub Commentary_

Cloud for the sake of cloud and a technology will leave organizations following their competition.  I could not agree more and have many times commented here on The Hub regarding the use of the right technology deployment for the service, cost and value as described in the post on defining your services.

Now more than ever if IT is to achieve getting to service orchestrator ,they must start managing technology as a service over silo’d technologies.  This is going to requiring baking management into the services such that they are service enabled and provide proactive visibility as to their performance in real-time to mitigate risk and deliver the highest quality of services.

Management always lags new technology, but in this case to achieve the imperative of becoming a service orchestrator / broker / manager, IT has to evaluate a new way of managing the services they are responsible.  Yes, IT is responsible for the service regardless of how it delivered.

With buying decisions moving to the business, the job of managing services will get harder before it gets easier.  The business is taking over out of frustration to drive change, however, ownership of managing the service is being overlooked and putting IT back into the reactionary seat.  Now is the time to move from reactionary to proactive service broker.

Are you driving or riding as your business takes competitive advantage or loss?

Michele

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If the innovative ways that businesses are using cloud computing haven’t set off alarms within your organization, it’s time that they did. Enterprises that look at the cloud solely through the lens of technology will be left behind by more agile competitors that use the cloud to develop innovative new business models based on faster time to market, new modes of customer interaction and more efficient operating models. Likewise, ITservice providers that market their cloud offerings simply as technology solutions will be outmaneuvered by competitors that position their offerings based on the business value they deliver.  (Read Full Article…)

The Hub Commentary_

BYOD makes the headlines, it takes just one to spoil the party.  Mobility whether internally issued or personal devices all carry management and security management concerns and challenges.

After 20+ years from the days of mainframe, to distributed networks, now to highly mobile device du jour IT organizations must break the cycle of new technology first, management later.  Headlines are always an eyeopener for a wake up call.

IT is being outsourced rapidly and must develop the discipline to manage new technology and manage it accordance to business priorities.  For instance, many engineering firms are arming their field engineers with mobile devices.  Managing that mobile infrastructure is driving the business and must be managed as such as all services are not created equal.

This is a light offense and an article worth a grin, but should be an eyeopener too.  The worst is yet to come in the headlines.

Are you managing or hoping no one spoils the technology party?

Michele

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Mimecast CEO Peter Bauer recently found himself at the intersection of consumerization and IT management, falling victim to personal data loss as the result of the internal management policy he himself helped establish.  (Read Full Article…)

The Hub Commentary_

Technology spending is up from last year, but not across the board.  Interesting observation where investments are being made in software and subscriptions as I would have expected.

The competition of the service providers is heating up pushing IT organizations to think about where they invest to improve their business.  The environment is getting more complex with the introduction of multiple deployment platforms and managing the infrastructure in lock step with the business and evaluating outside options for commodity services will continue to grow.

Outsourcing options aid in driving change within the organization and the evaluation of which services are best suited inside and outside the organization.

Michele

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While I am still relatively bullish on the 2012 tech market outlook for the US (see April 2, 2012, “US Tech Market Outlook For 2012 To 2013“), I have to say that the data we got on the US economy and on the US tech market was a bit softer than I expected.  US real GDP growth came in at 2.2%, a bit lower than my expectation of 2.5%.  On the positive side, consumer spending rose by 2,9% in real terms, and residential construction continued to improve.  (Read Full Article…)

IT Management - High Availability

We on The Hub do not usually post tool specific posts, but today I’m going to point you to a great, best practices post by Tobin.  Yes, he does mention a product, but the post is more about setting up High Availability systems and what that means.

Often times when we speak with customers about Service Enabling their infrastructure and end-to-end visibility of services, we enter into a discussion of “nice to have” versus “must have”.  So why is management “must have” today and high availability relevant with management tools.  I always answer, “Do you want the pilot flying the plane blind without instruments?  Why would you run your business blind?”

IDC forecasts by 2013 >50% of IT budgets will be dedicated to Outsourced IT.  While most IT organizations are providing high availability of services, it’s not based upon priority.  90% of IT organizations are still a level 2 of maturity, reacting to events versus managing proactively.  Thus this tells us all technology is being managed equally when the business is shouting for management by priorities to the business and thus becoming more involved in buying decisions and deployment options.

Long story short, management and visibility is a must have to getting to proactive and removing the obstacles of embracing new technologies and services that drive the business.  This requires service enabling your infrastructure for visibility and then it must be treated as mission critical and requires high availability infrastructure to continue to deliver high quality services.

Do you treat your management systems as high availability systems?  Why not?

Michele 

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Configuring Operations Center (and other products) within a High Availability (HA) configuration tends to confuse people. I guess it starts with the basic requirement of needing an application/service configured in a manner that it has some level of Fault Tolerance (FT) and/or HA which in turn reduces the possibility of outages (system not being available for the end users). FT helps with HA, but FT is not HA. (more on that later)

Fault Tolerance (FT) is more about configuring the hardware of a system in a manner that in the event of a failure (IE: hard drive), without intervention, the system automatically recovers and continues to operate. The most common is around hard drives and leveraging “RAID” (Redudant Array of Independent Disks). Other solutions provide dual power supplies, NIC’s, etc.  Read More …

The Hub Commentary_

This is a fun article.  Reminds me of “The Mainframe is Dying” and yet it is still here.  I tend to agree with Arthur on this one, the data center will live on, but is under great change and the speed of change is coming fast.

This is nothing new to outsource, we’ve been through this before.  The difference this time is that the business is calling the shots.  According to a Gartner and Forbes survey of Board of Directors, 65% of BoD count on technology to drive competitive advantage for the business. The role of IT is evolving and it is an imperative that IT move from reactive and managing technology to proactively managing services and a manager/broker of services and be able to answer 3 simple questions in real time, 24x7x365:

• Are we open for business?
• How are we performing?
• What is our current risk?

Answering these questions requires turning a sea of technical data into actionable, intelligent information in real time. The time has come to make a difference in the business with technology.

The reason for the dramatic claims that the data center is dying, much like the mainframe, is the level of business frustration to drive change in behavior within IT organizations.

How is your IT organization evolving?

Michele

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At the turn of the 20th Century, city planners in New York and other great metropolitan areas were in a state of panic. If population growth continued unabated, their cities would be rendered uninhabitable due to the enormous amounts of manure left behind by all the horses needed to cart food in for the starving masses.  (Read Full Article…)

The Hub Commentary_

Nice article summing up considerations that must be evaluated when assessing a cloud deployment option.  IDC predicts that by 2013, 52% of IT budgets will be dedicated to “OUTSOURCED IT” – ASP, Public Cloud, and Enterprise/Hosted Private Cloud.  There is also a shift in where the budget and where spending decisions are being made – in the business.

As a former analyst in the sourcing space going back to the first ASP/ISP/MSP, du jour of the late 90’s / early 2000, the speed of this shift and the shift in decision making serves as an indicator in businesses to create change to drive the business.  The requirement to move from technology operator to service manager or broker has been there for almost 20 years.  Now there is competition to force the change.

Rarely is outsourcing cheaper, but it does create change that cannot be achieved easily from within.  Cloud deployment for the sake of it still isn’t the right blanket direction.  Looking at deployment options, commodity services, speed to market to drive competitive advantage whether inside or out are all factors to evaluate and consider.

If one lesson can be learned from these historical ebbs and flows between insourced and outsourced services, it should be that of service enablement in order to make the transition to service manager/broker at the time of deployment rather than an afterthought.  An effective service manager/broker will rely heavily on the federation or integration of data in order to manage the services delivered as mentioned by Gartner in the slides attached to the article.

How will you service enable  your infrastructure to deliver service value that powers your business, regardless of technology platform?

Michele

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It’s human nature to want the newest and best of everything, even if the ramifications are still unknown. Enterprises fall into this trap as well, considering they are built and run by humans. It’s kind of the digital version of shoot first and ask questions later.  (Read Full Article…)