Business Service Management Hub

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_

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…)

Mobility and wireless network infrastructures are the big takers when it comes to IT budget planning for 2012, our latest study reveals. Even so, organizations are moving to the next stage of the IT infrastructure build-out across multiple budget areas, and our 2012 IT Investment Patterns Study shows how the strategy trends of innovation, integration and reversion are having a significant impact on 2012 spending patterns.  Read More Here . . .

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In this survey results for spending in IT Operations/Management/Governance are the only area with an increase is Data Center Management. Those that are following the lead of the service providers will see this as the management of the technology to deliver that consistent and stable IT performance for business value from my previous post. Mobile delivery options prevail as a leading technology as the consumerization / BYOD (bring your own device) of IT continues. However, these solutions must perform and be available to drive your organizations competitive advantage in the market.  This is the link to business for 2012 investments requiring the stitching together of data from the many systems and applications that are in place today and turning it into real-time actionable information.

Does your IT just run the business or does it drive the business?

Michele

Is the enterprise ready for the cloud? Companies like Google, Salesforce, IBM and others think so and they’re creating solutions give enterprise customers what they want. Cloud-computing solutions are gaining traction across the market. As a CIO, the value of cloud computing is clear. And chances are, if your company hasn’t already deployed cloud solutions, you’re making plans to do so. However, with budget limitations, unless your CEO finds value in cloud computing, it may be challenging to get the solution you want. How can you educate your CEO and convince him or her that cloud computing will be a boon to your business?  Read More Here . . .

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I am still a little lost on the press convince your CEO of a new technology. Shouldn’t we be driving solutions leveraging the right deployment technology to drive competitive edge into the organization. Technology for the sake of a technology has no real value. While I agree with many of the points in this particular article on 10 Ways to Sell your CEO on Cloud Computing, it is still selling technology versus a business driving solution. We as IT have to change our thinking to that of the service providers that are popping up daily in selling our CEOs solutions leveraging technologies that drive agility and quality performance into the business, just so happens they use things like virtualization and cloud computing.

I’ve been working with many service providers as of late and it is reminiscent of the dot com era. Those that will survive and thrive are not just chasing the latest technology trend for the short term, but are baking in the practice that will sustain them for the long term and what business is asking of its own IT organizations, the ability to answer 3 questions:

(1)    “Am I open for business?”

(2)    ”How are we performing?” ”What is the customer experience?”

(3)    ”What is the risk of an outage?”

all in real time so as to take action, rather than reporting on it after the game is over.  The reason most organizations outsource services is not for cost, but for change that they cannot create from within the organization.  The time for IT to change and become the service provider of choice driving value and competitive advantage into their organizations has come.  Time to manage the business rather than convince someone of an IT technology or process.

What do you think?

Michele

Like many CIOs, you may find yourself struggling to innovate in advance of an anticipated economic recovery, while still striving to keep costs down in a decidedly uncertain business climate. And, even though you’re striving to be seen as a valued, senior member of your management teams, the enterprise perception of how much IT contributes to a competitive edge is decidedly mixed.  Read More Here . . .

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As part of its look to the future CIOInsight highlights the Top 3 initiatives keeping CIOs up at night: cutting costs, operational efficiencies and deliver consistent and stable IT performance to the business. These initiatives are neck and neck with the number of organizations that see IT as their competitive edge in the market. Most IT organizations still spend ~85% of their IT budget “just keeping the lights on”, with minimal focus on supporting and delivering upon stable and consistently performing innovative services aligned with business objectives. This percentage of spend is generally ~ 1 – 2 % of revenue spent annually operating rather than driving.

The cost of not evolving is far greater for IT organizations than the cost of transforming and adding value to their business.  Buying decisions are also migrating to the business because they have more options and they are creating change.  Outsourcing is never done for cost savings, it is to create change in the environment that the organization is unable to create on it’s own.

Time for change may have arrived in 2012.  Good set of insights.

Michele

It’s that time of year when the press is filled with the latest IT predictions for the coming year. A couple of articles and surveys caught my attention as they relate to the unspoken imperative of connecting to the business to drive the business for competitive advantage versus just operate the business. This practice, while not called out, is Business Service Management and is the heart and soul of success for many of these initiatives.

In the Gartner Forbes 2011 Survey of Board of Directors, “65% hold ‘high to very high’ expectations for IT strategic contribution to the business in 2012” and “52% rate ‘maintaining competitive advantage’ of ‘extremely high importance’…”.  It is no longer IT and the business, IT enables and drives the business.  The key question is, “does your IT operate or power your organization?”

As part of its look to the future CIOInsight highlights the Top 3 initiatives keeping CIOs up at night: cutting costs, operational efficiencies and deliver consistent and stable IT performance to the business. These initiatives are neck and neck with the number of organizations that see IT as their competitive edge in the market. Most IT organizations still spend ~85% of their IT budget “just keeping the lights on”, with minimal focus on supporting and delivering upon stable and consistently performing innovative services aligned with business objectives. This percentage of spend is generally ~ 1 – 2 % of revenue spent annually operating rather than driving.

There is also an equal amount of press on new technologies and how to convince your CEO of a new technology. Shouldn’t we be driving solutions leveraging the right deployment technology to drive competitive edge into the organization. Technology for the sake of a technology has no real value. While I agree with many of the points in this particular article on 10 Ways to Sell your CEO on Cloud Computing, it is still selling technology versus a business driving solution. We as IT have to change our thinking to that of the service providers that are popping up daily in selling our CEOs solutions leveraging technologies that drive agility and quality performance into the business, just so happens they use things like virtualization and cloud computing.

I’ve been working with many service providers as of late and it is reminiscent of the dot com era. Those that will survive and thrive are not just chasing the latest technology trend for the short term, but are baking in the practice that will sustain them for the long term and what business is asking of its own IT organizations, the ability to answer 3 questions:

(1)    “Am I open for business?”

(2)    ”How are we performing?” ”What is the customer experience?”

(3)    ”What is the risk of an outage?”

all in real time so as to take action, rather than reporting on it after the game is over.  The reason most organizations outsource services is not for cost, but for change that they cannot create from within the organization.  The time for IT to change and become the service provider of choice driving value and competitive advantage into their organizations has come.

In a recent CIOInsight survey results for spending in IT Operations/Management/Governance, I see the only area with an increase is Data Center Management. Those that are following the lead of the service providers will see this as the management of the technology to deliver that consistent and stable IT performance for business value. Mobile delivery options prevail as a leading technology as the consumerization / BYOD (bring your own device) of IT continues. However, these solutions must perform and be available to drive your organizations competitive advantage in the market.  This is the link to business for 2012 investments requiring the stitching together of data from the many systems and applications that are in place today and turning it into real-time actionable information.  Another Survey illustrating many of these and further results is the BSMReview.com 2011 BSM Maturity Benchmark Study.

In 2003 Nicholas Carr wrote a 28 page article for the Harvard Business Review, “IT Doesn’t Matter”.  In the article he discussed the outsourcing of IT and the changing roles within IT.  Now fast forward 9 years and the advent of the cloud, the explosion of service providers and new buying options.  The business is purchasing on its own and creating “The New IT” for those that are not evolving fast enough.  Leading analyst firms predict that by 2015 50% of all IT buying decisions will be made by the business, not IT.

I have had many conversations with organizations that are replacing their commodity monitoring tools from the Big 4 Vendors with lower cost options and turning that savings back into the investment of turning their IT organization into service providers of choice creating business value.  The investment is in the real time Business Service Views that transform the IT organization into proactive Service Delivery Managers versus reactionary red light / green light monitors turning the sea of data into actionable, intelligent information.  The service providers arealso making the very same investments to illustrate operational capability and market differentiation to capture market share fast during this great period of change.

I’ll quote from a long time customer who has leveraged the Operations Center solution for many years now. Their implementation, while it started technically as a single-pane-of-glass, has evolved into the trusted Business Service view and situational awareness of the environment running the business. Because this customer made the transition to trusted adviser and communicator as to the health of the business, he is trusted with purchasing decisions because as he states, “I provide value”. This is the secret sauce – providing business value and relevance for IT.

2012 will be an interesting year without a doubt with new technologies like mobile and cloud computing entering into leading IT organizations, the risk takers seizing the opportunities to drive their organizations.  The leaders will emerge as those risk takers who also bake in their operational management and efficiencies with controlled risk to deliver consistent, stable performance and value to the business.

Michele

Organizations practicing Business Service Management (BSM) have reaped benefits by aligning their IT with their business processes, improving end-to-end management and standardizing and automating routine tasks. Latest market trend shows CIO’s are slowly adopting cloud computing to reduce costs, increase storage, use the flexibility of automation and ultimately freeing up IT resources to stop worrying about server updates and shift focus on innovation.

Companies offering BSM are now faced with a new set of challenges that makes me question is BSM ready for the cloud? Service Level Agreement, which is absolutely vital and important for engagement of service or product, should now monitor, measure and report end user’s experience or end user’s ability to consume resources rather than customer based agreement. Performance challenge would be to provide end-to-end view in a hybrid cloud computing that spans a combination of on-premise, off-premise, physical and virtual environments by testing for bandwidth, connectivity, scalability, and the end user experience. Ultimately BSM should address security concerns that prevent companies to save their important data outside the firewall.

Given the challenges and also the benefits of cloud computing its wait and watch to see if CIO’s invest and adopt BSM for cloud computing.

Manju

A friend of mine, Richard Whitehead, recently posted two blogs (Two Lawyers and Shakin Up) on the topic of service level agreements, contracts and lawyers for cloud based services.  My favorite quote in these posts, “Send lawyers, guns and money”.   All I can say is, if it comes to lawyers, guns and money, it just ain’t worth it.  Far too much time is spent on the negotiation and perceived service missteps than is put into the quality of service and driving revenue.

This is a topic near to my heart as I embark this week to draft my own presentation on the topic, Cloud Service Contract Get Stormy, for the upcoming Data Center World Conference in Orlando later this year.  As an analyst, I would review many outsourced service level agreements against industry best practices, reasonableness and guidance regarding how to manage services.  There are a few common pieces of advice I suggest:

• Service Accountability – you as the IT organization maintain ultimate accountability for the service to the business and your customers.
• Operational Processes – you as IT no longer own “how” the service is delivered only that it is delivered in a manner that is acceptable.
• Operational Tools – you as IT no longer own the management tools and technology that monitors the delivery of service.
• Service Levels – accept the standard service levels, drive toward economies of scale and standardization.
• Penalties – protect for gross negligence and harm to the business, not perfection for the sake of perfection.
• End of Contract – data, who owns it, how is it transitioned – be sure the transition is covered to avoid hidden costs.

The first thing I suggest that organizations review are their services – not all services are created equal.  Some drive revenue, others drive out costs from the organization.  I’ve covered this categorization in another post Finding Your Services.  Classify your services and source the commodity services that are not unique to your organization.  The more unique, the more mission critical, the less appropriate it is to outsource unless you are early to market and do not have the talent in-house and need to buy it.  There is risk and reward to buying talent to deliver a market changing service and there is some forgiveness in the market for hiccups in this scenario.   Source with clear objectives and manage as such.

The second thing I usually end up discussing is “how” the service is delivered and “managed”.  Do you tell your electricity provider how to deliver electricity to you home or business?  Do you tell them the proper management practices and tools to use to deliver electricity?  And yet having adequate power is a piece of delivering IT services.  I believe what makes the sourcing of IT services different is that we as IT organizations have some expertise in delivering the commodity services and while we want to insure quality service, we need to step back and define the service and performance objectives and manage to those shifting our role from service deliverer to service manager.  It is up to the service provider to deliver the service and meet the agreed upon objectives.  The role of IT is shifting in these mixed environments to a service manager and communicator of service to the business as it drives revenue.  This is illustrated as the hottest growing job in IT is a Business Architect according to a recent article in InfoWorld translating technology as service performance to the business.

The next thing that comes up is the viability of the service provider.  This takes us slightly back to the previous paragraph to insure the provider has processes, practices and tools in place to reasonable manage the service without mandating how the service is delivered.  There are other points of reference here as well regarding their financial viability, duration in business, other customers, references not just for the good service, but references when service failed and how the provider responded.

Service levels and penalties is another topic of discussion and where visions of guns and lawyers dance around.  Go back to step 1 and remind yourself of the value of the service, don’t demand unreasonable service levels as they will come at a premium price and thus don’t impose high penalties also raising the risk of the service to the provider and thus cost to you.  Understand reasonable levels of performance, availability, responsiveness and security.  The more custom and imposing your SLAs and penalties, the higher the cost of the service and thus the higher the cost to manage the service.

Finally, do not overlook the end of contract transition.  Insure there are no surprises or hidden costs in transitioning systems, data, etc.

The final, final discussion is monitoring the performance of the service.  Budget 7% of the contract value to manage the vendor and service.  This includes the monitoring of the service to avoid those perception versus reality discussion of the health of the service.  It is still ITs responsibility to manage the service and know how it is performing to take appropriate proactive action in the event there is a hiccup whether that be to deploy additional resources, re-direct resources, etc. for services delivered in-house, by providers or in the growing mixed environment.

In the end, the choice comes down to “pay now or pay later”.  I find it money better spent to monitor, manage and nurture the service provider relationship in the delivery of quality service over paying a lot more to bring out the guns and lawyers at the end.  The first drives revenue growth, the second illustrates failure and lost revenue to lynch a scapegoat.

I too listened to the customer speak that Richard references in his second blog post that does business with a handshake and works toward driving revenue.  Lawyers and Government are not the answer to regulating cloud service providers – drive your own destiny and revenue.  Ok….back to my presentation, come to Data Center World and hear more!

Michele

The Hub Commentary_

I tend to agree with James and have written often on the same subject.  Those leading their industry this year, likely won’t be the ones leading next year.  The question is are you trying to merely drive down costs or fuel growth?  Even with the Amazon blip of a week or so ago, those fueling growth are unwaivered in their approach.

Define and leverage the cloud as a deployment option with the right objective and measure it accordingly.  There will be blips in service from service providers, have an alternative plan for those occurrences based upon the requirements of the service.  Having the proper monitoring and management in place to monitor and measure services will be key.

Just because you push services to external providers does not mean you have alleviated the accountability for the service.  Management of the providers has to be factored into the cost of the service.

I look forward to comparing this years Fortune 500 list to next years and find the movers and shakers of their industry.

Do you run for cost or fuel for growth?

Michele

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Is your cloud strategy centered on saving money or fueling revenue growth? Where you land on this question could determine a lot about your experience level with cloud services and what guidance you should be giving to your application developers and infrastructure & operations teams. According to our research the majority of CIOs would vote for the savings, seeing cloud computing as an evolution of outsourcing and hosting that can drive down capital and operations expenses. In some cases this is correct but in many the opposite will result.  (Read Full Article…)

The Hub Commentary_

I agree that costs need to be managed, however, there comes a point of no return.  Justifying the business value and return on investment is the shift IT organizations need to make in order to be competitive with the cloud and SaaS providers.

There needs to be focus on cost cutting where possible, however, there needs to be more focus on the delivery of value and growing the business with technology.  It is great to spend on technology when you can illustrate gains in revenue through the use of technology whether it be customer retention and quality of service or a differentiating service in the market.

Are you merely counting pennies or spending to gain?

Michele

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Companies overspent by more than $207 billion on technology and telecom purchases last year, according to NPI, a consulting firm specializing in the management of IT spending. Many enterprises were dealing with budgets that had been slashed during the Great Recession, even as new projects were expected to drive the innovation necessary for growth.  (Read Full Article…)

So many statistics out there about when we’ll adopt the cloud. Some may suggest that it’s years away, that by 2013 only small bits will be there. Others say, that many organizations are there today. What are you to believe?

For the sake of argument, lets separate public cloud services like Google Docs and Salesforce.com and stick to the idea of private cloud — that is, the idea of building a set of services not unlike the public cloud, inside the firewall. Think of a portal of services you’ve built out on virtual machines providing you and your users with fixed costs and resource flexibility.

It sounds wonderful and there is a lot of upside to building a private cloud, but like anything else, there is expense involved. There is at least a couple of layers of technology you need to lay on top of these services offering (not the least of which should be business service management, ahem).

That’s why I was surprised to read a list of IDC predictions for 2011 — we are talking this year, not some nebulous point way off in the future — that the private cloud would mature in 2011. To be precise, IDC predicted that “Private Cloud Plans Will Mature, Dominate the Enterprise Infrastructure Software Agenda in 2011.”

That’s a pretty bold statement when you consider that a lot of companies still don’t understand the difference between the public and private cloud yet. Many remain wary of it for a number of reasons and it would require a significant change in direction for many IT departments.

Do I think companies are discussing it? I definitely think many CIOs are having conversations with their staffs about building private clouds, but change happens slowly in most IT departments.

In spite of the rapid pace of technological change going on all around us, I think it’s a bit unrealistic to think that what is basically a new technology will mature and dominate. Perhaps discussion will begin and maybe even some sand boxing. Perhaps companies will put forth a plan of attack, but to expect it to mature and dominate as IDC predicted is highly unrealistic to me and is counter to the way I’ve learned IT departments move, operate and absorb change.

Photo by gareth1953 on Flickr. Used under Creative Commons License.

VMware announced that it is launching Cloud Foundry, a move that will put the company smack dab in the center of the Platform as a Service (PaaS) market. The project is in Beta for now.

As I wrote in Understanding the Different Levels of Cloud Computing, PaaS “…provides a platform on which you can build applications usually linked to a particular vendor.” VMware is traditionally known as a company that provides the software to build out virtual machines, a key component in building and deploying private clouds, so this takes them in a new direction.

Geva Perry, writing on his Thinking Out Cloud blog, says what’s interesting about this offering is that it offers a series of VMware branded services such as data and messaging services, but also uses an open architecture that enables enterprises to link other non-VMware services. This is in contrast to Salesforce.com, whose PaaS offering is really designed to lock you into the Salesforce platform (which is fine if that’s where you’re working, not everyone is about customer relationship management).

This is an intriguing offering for any IT pro because it provides a central place where you can build your cloud infrastructure with a mix of public and private services. Now what’s really interesting here is the open nature of this platform. If it’s truly open, and depending on how flexible the API is, perhaps you could also connect the whole kit and kaboodle to your monitoring tool. Imagine how that would be?

I’m not certain this is possible having just seen the picture of the architecture in the blog post, but if it were, it opens up some interesting possibilities as it would allow you to have the means to monitor your entire system from a single view, a pretty attractive idea.

If it’s not that easy to connect to an external monitoring system, it should be because this type of connectivity has to become a priority. IT pros need to have the tools to monitor the whole system wherever it resides and a tool like this that mixes services should provide that.

Photo by jenny-bee on Flickr. Used under Creative Commons License.

The Hub Commentary_

The news continued through the weekend on the Amazon outage this past week.  While many who are commenting are using it as an opportunity to point the finger that the cloud has failed.  I do not.  The cloud is here to stay.

The role of the IT organization is changing to that of the service provider managing the services delivered to the business.  Just because a public cloud becomes the deployment option of choice does not let IT off the hook for responsibility of the service.  Think about it as your car and taking it in for service.  Just because Ford, GM, etc. didn’t ship a part doesn’t make you any less happy when the dealer says, “I didn’t get the part from the manufacturer”.  Did you take your car to the dealer or the manufacturer?

Agile and dynamic infrastructures are here to stay.  Those that embrace them and take advantage of them early, will lead their industries.  As one article stated that one of those affected said, “we wouldn’t be as far along without Amazon”.  What this boils down to is what often lags with new technology – management.

I wrote a previous article on defining service value and then define deployment options, service levels, back-up and recovery.  The natural market reaction will be to impose stringent service level requirements on the service providers, I’m here to tell you that you will pay for doing that.  Define the appropriate service level for the criticality of the service.  Then I suggest planning for the contingency of a major outage, don’t pay for the risk of the catastrophic every day for something that may happen once, never, etc.   Have a back-up plan.

What is your back-up plan?

Michele

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Despite restoring service for many customers, Amazon’s troubles with its Elastic Compute Cloud (EC2) and Relational Database Service continue this morning, meaning that debate over the wisdom of relying on such cloud services is certain to grow louder.  (Read Full Article…)

The Hub Commentary_

I’ve commented in this similar vein on many posts this year and the cost calculation and business value is covered in my post and recorded presentation here on The Hub.  My friend Michael sums up this topic well with citations from InformationWeek and Forrester. It is not about the technology, it is about the service value the technology brings to the business, something those in the business service management practice have known for many years.

So what makes it different now and why is it so prevalent in the news?  That’s an easy answer, Competition ala service providers.  Today in fact I discussed just this topic with a global audience and why competition will be the catalyst for change or outsourcing this time.  Service providers are going direct to the business to sell their services.  They speak exactly the language the business wants to hear, make it simple to buy and this will push IT organizations to adopt a business service management practice or get outsourced.

I like the notion of a Chief Acceleration Officer.  I enjoy times and situations like this where there is a challenge to solve for and the requirement for change where I know most IT organizations are change averse.  IT has been in this cycle of 80% + spent on just keeping the lights on for more than 20 years.  This equates to 1-2% of revenue annually just running the operations and thus very little is expended to grow the top line.  This is crazy when technology should be driving business innovation and growth.

I challenge you to pick up this years Fortune 500 magazine and then pick up next years and see who takes over leading their industry and that will tell you who embraced technology to drive growth and create efficiencies within IT to shift that 80/20 pie to something more like 60/40.  I wholeheartedly agree with my friend Michael, it’s about the agility and business value that a technology brings an organization.  Efficiencies are good, but should not be the only focus.

How are you driving service value and agility to be the change in your organization?

Michele

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With the promise of cloud computing splashed across every headline today, it’s easy to lose track of where its greatest opportunities lie. Yes, saving money is important. It can help nudge the dreaded 80/20 maintenance-to-innovation ratio in the right direction. But when you’re thinking about the cloud, don’t stop there. It’s agility that can drive business growth and innovation, turning IT leaders into heroes.  (Read Full Article…)

The Hub Commentary_

I would agree network performance is an aspect to consider when setting up and considering deployment options for mass storage.  Another aspect to consider is something I covered in another post on Categorizing your Serivces and which services, inclusive of data, should be put out in the cloud.

In all sourcing situations you need to consider:  security, performance, responsiveness to recovery, and management of the vendor.  A good rule of thumb estimate in managing the provider is 3-7% of the value of the contract.  This is an often overlooked cost in these short sided decisions to reduce costs short term by removing hardware, management and staff potentially.

Storage is well suited for cloud services, however, the service it supports and the criticality to the business is a high consideration.  Commodity data and services are easily the first to be considered for external service providers.  However the more mission critical and data sensitive it becomes to the organization, the more cost prohibitive it becomes to source the service.

Yes, performance is a key to consider, however, I still surmise that the service criticality to the business must also be in the decision process.

How do you decide how to right source your IT services?

Michele

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We all know that the cloud can provide cheaper storage than in-house infrastructure, but is it better?

Of course, there are numerous ways to quantify “better,” but from an operations standpoint, it wouldn’t hurt to know exactly what you’re getting and what you’re giving up when you sign on the dotted line. (Read Full Article…)

The Hub Commentary_

I came across this piece by my friend Dennis this week and thought how appropriate in reflection of the many articles I read, post and blog about regarding the tremendous change under foot for IT organizations this coming year.  IT is facing competition from the multitude of cloud based service providers who are selling services directly to the businesses because they can communicate a service, cost and value and they make it extremely easy and attractive to purchase.  IT must make this change in communicating their services if they plan to remain strategic within their organization.

The other facet to this article that pops out to me as I recently experienced this in my own daily working is that of the software or technology being the problem.  In my case it was software being blamed for not working and being told this is how the software works.  I am the customer wanting information out of a system to measure the effectiveness of a marketing campaign.  I don’t care how the software work even though I work for a software company, I could care less if the system runs on a mainframe and is written in FORTRAN.  I want visibility of the data passing through the system without getting caught up in how the software works.  I also stated it isn’t that the software doesn’t work, it’s the implementation – garbage in, garbage out.  In this case, it is an incinerator and nothing comes out.

The business doesn’t care how many monitoring tools, networks, boxes, applications it takes to process transactions.  They want to visibility to the performance of their services requiring IT to implement end-to-end management views or business service management views.  This requires a top down approach in looking at your infrastructure and what makes up the service, requiring integration of data, transforming it into meaningful information by which to run the business.

All of this will require change for a change averse culture.  This will be a tough year for many IT professionals as Dennis points out.  They will need to:

• Learn to communicate
• Communicate in terms of service versus technology
• Embrace new technology deployment options
• Be catalyst for flexibility and agility
• Can do change agents
• Seek tools that enable, automate and help them

How ready is your IT to be the agent of change?

Michele

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EMA consulting once did an analysis of why strategic service management initiatives fail.  These ranged from cross-domain performance management initiatives, to configuration management initiatives with CMDB/CMS enabling foundations,  to company-wide asset management initiatives to name a few.    Of the top ten reasons for failure, only the bottom two (Integration and Discovery) were technology-related.  (Read Full Article…)

The Hub Commentary_

Nice article and similar to a previous post of mine on Finding your Services. In that post I described mapping your services based upon cost and value to the organization.  Keeping those differentiating services in house and evaluating other deployment options, like Cloud, for those that do not differentiate your organization.

A component called out in this article is usually the obstacle that keeps these projects from being right sourced, fear of losing jobs.  It’s a job evolution as the author describes to a service provider, business analyst, value add analytics driving growth into the business.

The model is much like that of the manager of managers.  IT becomes the manager of managers and analyst of services and will require the tools to aid in turning data into information.  There becomes the requirement for the integration platform that pulls data from the various monitors and service providers, as well as the value/volume of transactions being processed driving growth.

IT becomes “glue and the view” into the services they provide and their performance to the organization.

How are you preparing to evolve your data center staff and services?

Michele

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When CIOs take calculated risks, choosing emerging technologies from less established companies, the payoff can be enticing. We take you inside the journey of two established organizations for a deeper look at this success.   (Read Full Article…)

The Hub Commentary_

Cloud ROI of 80%, I must agree – NOT.  This is exactly what creates hype and those short term cost savings in hardware and software manifest in long term management and monitoring.  Measuring business services and growth to the bottom line of your organization is a better measure.

As the author describes, cloud based computing brings agility to the organization to be flexible and respond in market time to changing conditions and leverage economies of scale in a shared infrastructure.  The second savings is not managing systems that are common to all organizations and provide no market differentiation for your organization.

However, in the rush to the cloud many are leaping, falling off, the cliff by not planning the management, monitoring and measurement in during development.  Agility is a great thing, but adds complexity and requires a strategy in measuring business services and monitoring the performance of your service providers.

No doubt there are cost savings and when deployed strategically, cloud computing will be the innovation that could drive growth into an organization.  Deployed tactically under the hype umbrella of short term hardware savings will only push some organizations off the cliff of doom.

What is your realistic expectation of ROI for your cloud deployments?

Michele

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A recent Microsoft “study” claims an 80 percent savings by using the cloud. This news hit the blogosphere with a big splash — it’s another positive outlook for cloud computing, and it provides some pretty compelling reasons to move to the cloud.  Not.  (Read Full Article…)

The Hub Commentary_

This is a nice synopsis of the challenges of moving to the cloud and virtualization into production.  I enjoy the start of the article regarding when we lost our switchboard operators and the shift we’ve made with the telephone.  Just a year ago, the east coast was hammered with 3 – 3 foot snow storms leaving me to telecommute from my home, built 30 years prior.  I learned far more about the telephone than I wanted and my favorite acronym was POTS (plain old telephone system).  Yes, it is true. Long story short, I went through a full upgrade to fiber, digital phone service and a full duplex digital phone to better enable my communication capabilities from the home office.  There were multiple components to consider and upgrade to gain the full performance I was expecting.

What this article subtly uncovers is the usual cycle of management following new technology adoption.  The short term bang for the buck with new technology is generally the removal of short term hardware and software costs with physical components and licenses.  This time the challenge is further aggravated within the organization through competition with the service providers that are going directly to the business and bypassing IT knowing they can make IT as the bad guy and obstacle.

The article uncovers the flexibility cloud and virtualization bring to an environment, but also the requirement for an integration platform to make sense of the configurations and the monitoring alerts at the component level into business services as they are consumed.  This is the driving force behind the business service management imperative this year that the author also notes.

Operations is holding the business back from the promise of cloud computing because operations is struggling to manage the infrastructure and have no visibility across the infrastructure to insure availability and use the cloud for the agility of improved availability.  Business is demanding the intelligence and communication of service performance, not components, and are seeking to leverage the cloud strategically in their organization as a growth enabler and it is imperative that IT seek to support and make the initiative successful.

If IT continues as the obstacle, the competition is knocking on the business door to take that business.  It is not a single management technology that will solve this challenge, it is the integration platform that provides the end-to-end view and enables building in intelligence to set thresholds to monitor service performance aligned to objectives.  I like to call  it, “the glue and a view” that will make sense of the environment that is the imperative to successful IT operations management in this coming year.

What’s your strategy for Glue and a View?

Michele

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It’s been nearly 50 years since the telephone switchboard, staffed by an “operator,” was phased out as automated phone-switching technologies were introduced. In automating the process of making a call, phone companies removed a burdensome manual hindrance from what was soon to become a much more convenient and ubiquitous part of modern life.  (Read Full Article…)