By: Rob Bamforth, Principal Analyst, Quocirca Posted: 4th April 2013 Copyright Quocirca © 2013

The impact of new mobile devices such as tablets and smartphones might not altogether remove the need for desktop computers, but it does open up the potential for a really radical shift in how workplaces of the future might look.

For a start, the subtle way that even simple mobile phones increase flexibility in the working environment, even inside its boundary—no one needs to return to their personal desk to make or receive a call. With smart phones and tablets, all forms of communication can be achieved on the move—voice, text or video—and can be ‘unified’ around a corporate platform or ‘social’ around a consumer (or perhaps enterprise) platform.

The concept of ‘in’ and ‘out’ trays therefore seems a little dated, although most would admit the paperless office is still a distant dream So, does everyone need their own personal desk while in the building?

Since many now have working practices (and technology) that allows them to be productive outside the office environment—at home or out and about mobile—is there a case for revisiting the concept of shared desks to cover for the odd time when someone is in?

This idea of flexible working, hot-desking, or ‘hoteling’ is not new, but advances in mobile technologies, the ubiquity of wireless networks and the personal appetite for working on the move and seeing the office as a place for occasional use all gives it an extra boost.

So too does the potential for cost saving.

The cost of providing a typical desk in a city like London can easily run to over £10,000 per year, and the average across the UK is almost £6,000. Providing one for every employee, whether they are going to use it all the time or not, starts to look like an unnecessary extravagance, especially if all it is doing for many working hours is acting as a support for a few personal photos, memorabilia from past training courses and a never-inspected pile of (often unnecessary) paperwork.

Despite this, many companies as well as individuals, find it difficult to kick the mahogany (or aluminium and chipboard) habit. According to recent research conducted for Vodafone, just over a third of companies had not even considered flexible working to reduce costs, thought reducing desks was ‘inappropriate’ for their business or thought it would have a negative impact on teamwork.

A lot of the people-related preparatory work for switching to a flexible office can be a bit daunting and de-humanising. Terms such as ‘stacking density’ do little to boost morale and while most organisations and individuals would like to think they measure success by results rather than time in the office, presentee-ism still prevails and being seen in the office is perceived to have promotional value.

Technology can help with this, especially as so many consumers have been ‘converted’ to mobile, but it still needs careful management.

First the devices. Now that so many expect to BYOD (Bring Your Own Device) to use at work, there are more types of devices to deal with, all with different and personal applications. User expectations are high, but still the organisation needs to secure its assets, especially data. Controls, policies and procedures need to be applied and, although user education has to be at the heart of it, automated management controls are vital to avoid costs spiralling, otherwise everyone might as well be given a desk.

Next come the networks. Most organisations have an infrastructure designed around people sat in fixed and known locations, and even desk swapping raises issues—“that’s my PC!” or “why can’t this phone ring with my incoming calls?”. Wireless networks, where they are present, are often oriented around laptops. So connectivity may be available in the places where people can sit and ‘de-camp’, but there may be insufficient coverage and capacity to deal with lower powered radios in devices such as most smartphones AND tablets.

The network capacity will also need to be increased, but also in a flexible, dynamic and automated way. Increased use of video and ‘chatty’, more social collaboration—good for bringing diverse and dispersed teams closer together—impacts on the network, especially if users are mobile and video usage is ad hoc and unpredictable.

In a flexible office, even the traditional desktop (yes, they’re unlikely to disappear completely just yet) is affected. The network needs to be able to cope with delivering services to different users in different places at different times. User authentication and delivery of their services to the spot they’re currently occupying requires sophisticated and predictable management.

The working world may be coming much more mobile, but in the flexible office one thing is still fixed—the need to manage everything as simply, seamlessly and automatically as possible.

This article first appeared on http://www.computerweekly.com and is based on a webinar conducted with Kaseya UK

By: Rob Bamforth, Principal Analyst, Quocirca Posted: 27th March 2013 Copyright Quocirca © 2013

The recent announcement at Yahoo! about cutting down working from home and getting employees to come into the office seems to have put a virtual cat among several distributed pigeons. It might be that there are a number of remote, disgruntled and disaffected employees who are simmering remotely out there in distant cyber space who are not getting the message about how the business needs to be changed, but this appears to be a very public way to conduct change management.

One thing is sure, it has brought many opinions, fears and prejudices about work out into the open.

First there is the feeling among many who do not or cannot work from home, that all those who do must be ‘tele-shirking’, i.e. not really working but being subject to a thousand and one distractions—was that the doorbell? I’ll just vacuum the hall and make another cup of coffee. 

This feeling also pervades many managers; after all, if you can’t see each and every one of the workers, how do you know if they’re really working or not? This may sound a bit old-fashioned shop floor or weaving mill with an overseer or foreman at one end of a line of workers, literally keeping an eye on them as they work. But, a quick glance around most modern offices and business park facilities will show glass-fronted offices for managers and open plan seating areas for ‘the workers’. Plus ca change?

On the flip side there is the understandable fear of remote workers that those in the office get more ‘real’ time and therefore influence with the boss. This might translate into better opportunities for pay rises and promotions for those able to maximise their visibility and more frequently get the ear of their manager.

Surely technology fixed this? After all, those working from home will be connected via the internet right into the heart of the corporate enterprise IT systems, they will most likely have mobile phones and may even have video conferencing, desktop sharing tools and unified communications. They can phone, email, chat, text, video call, collaborate with a whole variety of tools—in or out of the office—as much as they like and, with open IP networks, pretty cheaply. So much so that one company banned the use of email for internal communications as it seemed like employees were doing it too much.

So why should it really matter where people are?

Past Quocirca research once indicated a fear of loss of organisational culture if people were working too much while mobile or at home, and some commentators think this might be what Yahoo! is trying to address. However, simply bringing a number of individuals who were simmering at home back together is unlikely to stimulate upbeat and innovative water cooler conversations, but more likely a seething cauldron of gripes.

The underlying problem is unlikely to be either one of technology or location, but management. That’s not just the day-to-day operational stuff of goal-setting, nurturing, mentoring, delegating, support, feedback, correction and reward, but also the higher level direction of who we are, why we’re here and what we do.

This does not mean a meaningless buzzword-laden mission statement that people smirk at, but a credible corporate culture that employees can relate to, sign up to or decide is not for them and move out. It can be as simple as “don’t be evil” or as prescriptive as a training program, but either way it has to be consistent, applied from the top of the organisation to the bottom and understood by everyone.

That underpins the relationship with customers, suppliers, partners, peers, subordinates and managers, which then has to be supported by the right operational management tools. This is the crucial bit that makes it all work, or not, and this is one area where the development of management skills has been lacking in recent years—especially people, time and process management. Technology can then play a part in supporting that, but only if people are taught how to use it—not the functional aspects they pick up or eventually read from manuals, but how to get the best out of it to perform a specific task.

At one time companies put their staff on courses to develop soft skills, with many of them geared towards some particular technology or communications medium. Time management for using their new Filofaxes; responsive communications e.g. how to answer the phone politely and in under three rings; take ownership of any issues; how to conduct effective meetings (hint: search online for “John Cleese meetings”).

Some may laugh and say this sort of training is no longer relevant to today’s busy workforce, but the inability to control communications overload, collaborate effectively with colleagues, manage remote or distributed workforces seems a little too widespread. Simply throwing more communications tools at employees, or even allowing them to bring their own, is not the answer on its own, but taking them away is not a step in the right direction.

By: Bob Tarzey, Service Director, Quocirca Posted: 12th March 2013 Copyright Quocirca © 2013

Resellers that can help their customers manage their IT infrastructure more efficiently should find that opportunity abounds if they get their service offerings and messaging right; they increasingly need to be seen as IT service providers. This is one of the conclusions that can be drawn from a recent research report by Quocirca “The wastage of human capital in IT operations”.

The report clearly shows that IT departments need to be savvier about how they use the skills of the staff in their organisations. Around 30% of the respondents to the survey, who were senior IT managers from UK enterprise across a range of industries, admit that as much as 30% of their IT team’s time is spent on low level tasks, which are often mundane and repetitive (Figure 1). They go on to admit that their team members spend as little as 40% of their time using the qualifications they have to do their job.

Many such tasks could be farmed out to specialists that have the tools and skills to automate them. A lack of such tools is one of the top frustrations listed by IT managers (Figure 2). It is not just about making the management of IT infrastructure more efficient and keeping costs under control by not wasting the time of highly skilled and highly paid staff. It is also to do with what the overall focus of IT teams should be in the first place.

IT managers say they would really like to get focussed on the modernisation of IT infrastructure and the delivery of new applications (Figure 3). Quocirca would argue that the second of these is the most important. It is not that the modernisation of IT infrastructure is unimportant, but that state-of-the-art IT platforms can be bought as a service through any on-demand provider. As the providers that manage such platforms carry out the mundane tasks such as maintenance, patching and upgrades as part of the service, the wastage outlined above simply disappears.

This leaves IT departments freer than ever to focus on the delivery of new applications. Surely, that should be the Holy Grail for any right minded Chief Information Office (CIO); delivering high quality application services to the businesses. In fact, the process of re-focussing on this would change the profile of the staff needed anyway; more business process analysts and fewer IT technicians.

Resellers that want to be seen as service providers and further embed their status as trusted advisors to their customers should focus on two things. 

1. They should be in a position to recommend and deliver on-demand services, be this infrastructure-as-a-service, platform-as-a-service or full software-as-a-service. This does not necessarily mean owning the infrastructure, but creating the network of relationships to supply such services through cloud brokerage and/or aggregation.
2. They should have the tools, skills and automated processes in place to manage integrated platforms for their customers that span existing legacy equipment and state-of-the-art on-demand services, with an aim to migrating applications over time where possible and/or appropriate.

Over time, more technically-focussed staff will drift away from end user organisations anyway, to find more fulfilling jobs with specialists, be they providers of on-demand platforms or those very resellers that aspire to be seen as service providers. Their new employers will make better use of their skills, as with IT delivery as their core business they will be less likely to waste skills in the way end user organisations manage to do. Those that remain with end user organisations will be able to focus on delivering true business value, which for many will have been a long-frustrated ambition.

Quocirca’s report includes a number of recommendations for how the management of IT infrastructure can be automated and the certain IT management processes industrialised. These are as relevant, if not more relevant for service providers as they are for end user organisations. Never before has the time been better for resellers to step up to mark and add the value they have always aspired to and become true IT service providers.

Quocirca’s report “The wastage of human capital in IT operations” can be freely viewed and download here: http://www.quocirca.com/reports/779/the-wastage-of-human-capital-in-it-operations

This article first appeared in CRN UK and on: http://www.channelweb.co.uk

By: Bob Tarzey, Service Director, Quocirca Posted: 12th February 2013 Copyright Quocirca © 2013

More and more of the IT infrastructure that businesses rely on is being managed by third parties, and there are two reasons for this.

First, many IT departments are taking formal decisions to make more use of on-demand services. This ranges from the use of co-location data centres that house private infrastructure through to full blown software-as-a-service where the end users provide nothing but the access devices (and even these may be maintained by a specialist managed service provider).

Second, there is plenty of informal use of cloud-based services, being subscribed to directly from lines of business, often with little reference to the IT department.

In a research report published by Symantec, titled “Avoiding the hidden costs of the cloud” this is termed ‘rogue IT’.

According to the survey, conducted among over 3,000 organisations in almost 30 countries, three quarters of organisations accept this is going on. The examples given include the sales manager who signs up for Salesforce without consulting IT, or marketing sharing launch materials with outsiders via a Dropbox account.

But this so-called ‘rogue IT’ is not a new phenomenon; a similar thing happened back in the 1980s with the rise of the mini-computer, which lines of business could buy direct, install under the desk and avoid the complex process of getting applications installed on the company mainframe.

The use of the term rogue IT suggests this is a bad thing and it may indeed lead to a loss of control of data if it is not policed. However, it also reflects the exasperation on the part of business that IT departments are failing to react fast enough to their needs.

There needs to be a meeting in the middle. The fact that decisions about making use of IT applications are moving away from IT departments and back towards business users is surely a good thing.

Over time that is going to involve a wholesale change in the way IT departments utilise the skills of their staff. The balance needs to change, moving away from technical specialists to more business-savvy individuals, tasked with making sure that applications, however they are sourced, support the business processes of the organisations they work for and the management of data is secure and compliant and procurement is cost effective.

Those that doubt that this should be an imperative should look at the wastage of IT skills in end-user organisations that was exposed in a free report recently published by Quocirca, The wastage of human capital in IT operations. On average, businesses estimate they are using well under half of the skills that their IT staff have on a day-to-day basis and, in most cases, this wastage is just accepted. This leads to de-motivated staff who will be looking for more fulfilling jobs, especially if the economy starts to pick up. And they will find them by turning to service providers.

The irony of this research is that IT managers admit that, if they were able to free up more of their staff’s time, they would focus on two things; modernising their IT infrastructure and providing better applications to the business.

Both of these could more rapidly be achieved by turning to service providers anyway, further driving that need for less technical and more business focussed in-house skills.

To be clear, this does not mean that technically skilled IT engineers are going to find themselves out of work; it is just that the best jobs for them will be with service providers rather than end-user organisations.

Here, they will find their jobs more motivating as service providers have to achieve the goal of delivering better quality, more efficient IT services than end user organisations can achieve in-house, because their whole business model relies on this.

They will be more likely to use advanced automated management processes, freeing engineers from mundane tasks to focus on more stimulating work.

Just as with the outsourcing of other business requirements, the service-provider-driven sourcing of IT needs access to reliable, high performance networks. However, it is not as if there is any other choice; as workers become more and more mobile and all organisations participate in network integrated business processes this is bound to be the case.

IT departments that continue to rely on fossilised applications running on creaking infrastructure that they are ill-equipped to manage will find themselves lagging further and further behind competitors that make more agile use of third party IT services.

For those seeking a career in IT, they will increasingly have two choices. Either a more technical role with service providers, helping to manage enterprise quality, massively scalable infrastructure that will underpin the majority of business IT needs in the long term; or a business focussed role in an end user organisation sourcing and integrating those services to best serve a given business.

Either way, IT will continue to offer a great career path for many aspiring young people for years to come.

This article first appeared on http://www.techrepublic.com

By: Bob Tarzey, Service Director, Quocirca Posted: 1st February 2013 Copyright Quocirca © 2013

The managers of any successful business must keep a constant focus on productivity. Well implemented IT helps to achieve this, for example through automating manufacturing processes, improving supply chain efficiency or enabling flexible working. The same managers may assume that the IT departments that help deliver these innovations are themselves productive. In many cases they will be wrong.

A recent Quocirca research report - The wastage of human capital in IT operations - shows that many IT teams could improve their productivity dramatically. As much as 40% of a team's time can be spent on routine low level tasks, for example patching software, dealing with end user device problems or error checking.

IT managers themselves are well aware of the issues and those in mid-market organisations, in particular, list such wastage of their team's time as a top frustration. They have a clear understanding of their staff's skills, but are not able to use them as effectively as they would like. For the individuals involved, work becomes boring and there is general demotivation.

Whilst the wastage should in itself be major concern, an even bigger concern is that this very issue is holding IT departments back from their raison d'être – helping businesses overall increase their productivity and competitiveness. IT managers admit that if they had 50% more man hours available to them, they would use these to modernise IT infrastructure and deliver new applications.

So what can be done? The truth is that the mundane tasks are not going to go away. IT managers have three options; stick with the status quo and accept the wastage; introduce cheaper, low skilled labour, probably through outsourcing areas of IT operations management; or introduce more automation.

It is estimated that 80% of IT infrastructure is common to most businesses IT operations. So, mundane tasks are being repeated by skilled operators on a huge scale. Outsourcing just displaces the problem when, in reality, automating these tasks and repeating them across multiple businesses should be straight forward.

The vendors of automation tools are themselves experts at building the procedures that enable repetitive tasks to be carried out time and time again across different organisations IT infrastructure. Such tools can recognise exceptions and make an intelligent hand over to human operators, be they an internal staff member or an expert from a third party specialist.

Once the investment in the tools has been made, the incremental charge for repeating is negligible compared to outsourcing. Such tools enable the industrialisation of IT – the efficient repetition of certain tasks hundreds or thousands of times over without consuming valuable IT staff time.

There are three options for achieving this: 

• Capital investment in new tools installed on-premise from the 'big' systems management vendors, namely BMC, HP, CA and IBM (some would add Microsoft's Systems Centre to this list)
• Freeing budget from operational spending to subscribe to on-demand system management services that support high levels of automation such as IP Soft and ServiceNow
• A hybrid approach with the flexibility to deliver both of the above, which is possible with the IP Soft tools and a few other vendors such as Kaseya

The ineffectiveness of many IT operations will spiral out of control if action is not taken to improve the way they are managed. Putting in place the necessary IT management tools, services and procedures to maximise automation and to industrialise processes will address this and reduce skills wastage. The ultimate value will be the ability to efficiently manage the increasing complexity of IT infrastructure, whilst delivering new applications that will ensure a business remains competitive.

By: Rob Bamforth, Principal Analyst, Quocirca Posted: 7th November 2012 Copyright Quocirca © 2012

Smart, small and well connected mobile devices have been around for some time, but the way they have spread into everyday life and across all levels of employees in the working environment is changing working practices.

At one time only a handful of early adopters and hardened road-warriors would want to work remotely. Now, according to recent Quocirca research, around a third of UK companies have more than 50% of their staff working remotely at some point during the working week. This is no longer an easy to identify select few, but a broad cross section of the work force, each with different aspirations, motivations and support needs.

The shift in the tools they are using is equally significant. Most are well aware of the consumer technology options available, and have their preferred devices, which they would like to bring and use at work—not only for working, but also for keeping in touch with their personal lives. Already over three quarters of UK companies allow personal devices to be used at work for certain employees, with a third of this number pretty much permitting it across the organisation.

This growing BYOD (bring your own device) trend, coupled with the different user interaction experience made possible by the latest generation of tablets and touch screens means that many are willing (sometimes delighted) to ditch the keyboard and the implied need to sit down to access their IT. ‘Work’ is not only no longer the macro environment that must be commuted to in order to conduct business, it is also no longer the micro environment oriented around a fixed desk and chair. Initially the laptop and now the mobile phone and tablet have removed the shackles of the desktop computer, fixed phone and stack of in/out trays.

The most visible challenges this brings to the organisation are often discussed and primarily revolve around security, management and support within the corporate culture and of course, the cost. But there are hidden issues with the network infrastructure, which will surface under this increasing pressure from employee expectations.

While no longer quite so dependent on office and desks, employees do have an increasing reliance on the network. It has to deliver service, wherever the employee happens to be; corridors, coffee shops or home. According to the latest mobile workforce survey by iPass, almost three quarters of employees will feel annoyed, frustrated or angry if they cannot connect to the network.

Even when they can make a connection to their employer’s private network, expectations of the user experience have been inflated by services received on the consumer side. At one time connectivity itself might have been sufficient, but now it is only the foundation at the base of a Maslow-like hierarchy of network needs that the network needs to deliver from the core data centre right to the edge. These are the demands of network dependent applications for throughput, capacity, assurance of delivery with a seamless, simple and effective user experience.

The decline of the desk and growth in mobile working exert even further pressure on the network. Remote and virtual teams of employees need to digitally communicate more than ever and share even richer content. Unified communications, which make it easier to involve more participants, switch media and threads of interaction and incorporate visual elements—application sharing and video—increases the impact on the capability of the network.

Not all network traffic is equal, at least from a business perspective, and organisations will increasingly find themselves having to dynamically tune and adjust to meet the ebb and flow of demands of users, their diverse devices and applications. It is no longer sufficient to think of the network as low value plumbing, but as a smart conduit that inspires employees and invigorates the business.

The network is not the computer (as Sun once stated) or the business (as Cisco declared), but is just as strategic an investment as other elements of IT.

By: Rob Bamforth, Principal Analyst, Quocirca Posted: 27th July 2012 Copyright Quocirca © 2012

IT is now rarely business driven but, increasingly, consumer led as most individuals have access to faster, smarter and smaller technology at home than that provided by their employers. New generations of ‘digital natives’, moving from pocket money-funded to independently-earning buyers of devices, have further fuelled the growth of consumer-friendly information and communications technology.

There are also increasing numbers of older ‘silver surfers’ getting to grips with technology, especially now that many products are becoming easier to use, more accessible and sold with less jargon (well, a little less…). Arguably they can afford to spend a little more on technology and with improvements meaning it has more appeal now, they probably will.

But there is another group of technology buyers who have sophisticated technology needs and, crucially, money to spend. We might, at one time, have called some of them ‘pro-sumers’, but these are business users of the distributed, connected and outsourced age. With the consumerisation of IT and a shift to part-time, virtual company and portfolio working patterns appealing to middle-aged workers, these could be termed ‘Internet connected Professionals Actively Down Shifting’ or IPADS.

How many are they? Precise current numbers are difficult to pin down, but research conducted by insurance company Prudential in 2003 indicated over 1.4 million downshifters in the UK, and anecdotal evidence suggests this number is growing. There are also increasing numbers of self-employed, mobile and flexible working practices.

So what about their needs? 

Do they have a geeky interest in the technology? Unlikely. Do they have IT support? Rarely. Do they have mega-budgets to invest in expensive solutions? No. Do they need effective and reliable communications and information support tools? Yes.

Technology vendors have been pushing many ’-bilities’ in recent years, with scalability and flexibility often at the top. Scalability to grow incrementally as needs change is a fine thing for a soaring start-up or large enterprise, but it means little to IPADS.

Flexibility on the other hand is fine, but for most IPADS it is table stakes. They have thrown off the corporate shackles in order to give themselves ultimate flexibility (and responsibility) and expect their IT to be just as flexible. This does not mean just the technical flexibility of open or standards based technology, but also the location flexibility of being mobile and working from anywhere. A varied and portfolio style business model means most will also need complete commercial flexibility – embodied by the emergence of user purchasable cloud-based services – XaaS – anything as a service.

So the other important ‘-bilities’ are two thirds of what used to be called RAS – reliability, availability and serviceability. IPADS, like many technology users, are no longer really interested in serviceability (replacement being more often prevalent in a throw away society), but they do want everything to work, constantly and consistently, reliable and available when required.

With flexibility and XaaS as the norm, number one on the IPAD agenda for reliability is network connectivity; fixed, probably, but mobile most definitely. As they are individuals there are limits to the amount of capacity they need, but reliability of connection is vital. Even low cost consumer broadband service providers can manage to deliver pretty high up time, but mobile networks are a different matter – especially as coverage has to include home office and expected places of mobile working.

If their down shifting has included relocation, it’s likely that somewhere picturesque, but remote will have been chosen, so connectivity may be patchy.

Which begs the question. If decades ago the TV industry managed to work out a way of broadcasting rich media over old fashioned analogue to an entire nation, why does the communications industry still struggle to get its digital bits – fixed over fibre or high speed wireless - into the far corners?

Reliable coverage still matters (just ask O2 customers) and there are more and more people who will pay if it supports their lifestyle.

This article first appeared on http://www.computing.co.uk

By: Dana Gardner, Principal Analyst, Interarbor Solutions Posted: 17th May 2012 Copyright Interarbor Solutions © 2012

It’s no secret that rocket .. err … data scientists are in short supply. The explosion of data and the corresponding explosion of tools, and the knock-on impacts of Moore’s and Metcalfe’s laws, is that there is more data, more connections, and more technology to process it than ever. At last year’s Hadoop World, there was a feeding frenzy for data scientists, which only barely dwarfed demand for the more technically oriented data architects. In English, that means:

1. Potential MacArthur Grant recipients who have a passion and insight for data, the mathematical and statistical prowess for ginning up the algorithms, and the artistry for painting the picture that all that data leads to. That’s what we mean by data scientists.
2. People who understand the platform side of Big Data, a.k.a., data architect or data engineer.

The data architect side will be the more straightforward nut to crack. Understanding big data platforms (Hadoop, MongoDB, Riak) and emerging Advanced SQL offerings (Exadata, Netezza, Greenplum, Vertica, and a bunch of recent upstarts like Calpont) is a technical skill that can be taught with well-defined courses. The laws of supply and demand will solve this one – just as they did when the dot com bubble created demand for Java programmers back in 1999.

Behind all the noise for Hadoop programmers, there’s a similar, but quieter desperate rush to recruit data scientists. While some data scientists call data scientist a buzzword, the need is real.

However, data science will be a tougher number to crack. It’s all about connecting the dots, not as easy as it sounds. The V’s of big data – volume, variety, velocity, and value — require someone who discovers insights from data; traditionally, that role was performed by the data miner. But data miners dealt with better-bounded problems and well-bounded (and known) data sets that made the problem more 2-dimensional.

The variety of Big Data – in form and in sources – introduces an element of the unknown. Deciphering Big Data requires a mix of investigative savvy, communications skills, creativity/artistry, and the ability to think counter-intuitively. And don’t forget it all comes atop a foundation of a solid statistical and machine learning background plus technical knowledge of the tools and programming languages of the trade.

Sometimes it seems like we’re looking for Albert Einstein or somebody smarter.

Nature abhors a vacuum
As nature abhors a vacuum, there’s also a rush to not only define what a data scientist is, but develop programs that could somehow teach it, software packages that to some extent package it, and otherwise throw them into a meat … err, the free market. EMC and other vendors are stepping up to the plate to offer training, not just on platforms, but for data science. Kaggle offers an innovative cloud-based, crowdsourced approach to data science, making available a predictive modeling platform and then staging sponsored 24-hour competitions for moonlighting data scientists to devise the best solutions to particular problems (redolent of the Netflix $1 million prize to devise a smarter algorithm for predicting viewer preferences).

With data science talent scarce, we’d expect that consulting firms would buy up talent that could then be “rented’ to multiple clients. Excluding a few offshore firms, few systems integrators (SIs) have yet stepped up to the plate to roll out formal big data practices (the logical place where data scientists would reside), but we expect that to change soon.

Opera Solutions, which has been in the game of predictive analytics consulting since 2004, is taking the next step down the packaging route. having raised $84 million in Series A funding last year, the company has staffed up to nearly 200 data scientists, making it one of the largest assemblages of genius this side of Google. Opera’s predictive analytics solutions are designed for a variety of platforms, SQL and Hadoop, and today they join the SAP Sapphire announcement stream with a release of their offering on the HANA in-memory database. Andrew Brust provides a good drilldown on the details on this announcement.

From SAP’s standpoint, Opera’s predictive analytics solutions are a logical fit for HANA as they involve the kinds of complex problems (e.g., a computation triggers other computations) that their new in-memory database platform was designed for.

There’s too much value at stake to expect that Opera will remain the only large aggregation of data scientists for hire. But ironically, the barriers to entry will keep the competition narrow and highly concentrated. Of course, with market demand, there will inevitably be a watering down of the definition of data scientists so that more companies can claim they’ve got one… or many.

The laws of supply and demand will kick in for data scientists, but the ramp up of supply won’t be as quick as that for the more platform-oriented data architect or engineer. Of necessity, that supply of data scientists will have to be augmented by software that automates the interpretation of machine learning, but there’s only so far that you can program creativity and counter-intuitive insight into a machine.

This guest post comes courtesy of Tony Baer's OnStrategies blog. Tony is senior analyst at Ovum.

By: Rob Bamforth, Principal Analyst, Quocirca Posted: 10th May 2012 Copyright Quocirca © 2012

As predicted and wished for by many, work is becoming something done, rather than a place to go. The once solid delineation of the workplace is breaking down and the impermeable barriers are becoming porous. A number of technologies are driving this – mobile, cloud, social – and ultimately the pervasive nature of lower cost, high speed and open networks are behind it.

This brings predictable challenges around security, management and control, which have been exacerbated by the increasing desire for consumer technologies to be used for work activities. At one time the tools of ICT – fixed or mobile phone, desktop or laptop – were corporate standard issue, now many employees want choice, personal preference and BYOD – bring your own device.

Beyond the clear technical issues that many are already attempting to address, organisations need to deal with the changes required in their cultural and management style, and this is somewhat harder and often overlooked. While the dreams of future work embodied in terms such as mobile, remote home and flexible working have been in common use for a couple of decades, the reality is being slowed by certain aspects of human nature.

These can be found in any workplace. Employees will refer to an absent colleague as ‘working from home’ (often drawing the inverted commas in the air), they will say how hard it is to get hold of so-and-so while they’re on the road, or they might wander round cubicles looking to see who’s in to deal with an emerging crisis. Tele-working for some has the air of ‘tele-shirking’ for others.

Managers and management culture generally doesn’t help. Many organisations claim flexible and mobile working strategies, but in reality they have desks allocated to individual employees (who fight over location during office desk reorgs and mark their territory with personal objects) that are overseen by a glass-walled manager’s office at the far end. This is not a new way of working, but the old with better décor.

The problems are visibility and responsibility. Some employees, especially when times are threatening, feel they need to be seen – hence the ‘presentee-ism’ prevalent in many work places; others just want to know they can get hold of a colleague when they need to – for help, support or simply to offload – or to know they are pulling their weight. Managers like to know where their direct reports are and what they’re up to.

Fortunately technology provides a number of ways to restore visibility (and some cultural cohesion) to remote, flexible and mobile or distributed teams of co-workers. These have been available for some time, but Quocirca research often shows that adoption has thus far been slow. While mobile working was for the relatively few independent ‘road warriors’ this was acceptable, but distributed teams need communications and collaborative support at several levels to visibly demonstrate they are involved and committed.

Companies could go the whole hog and implement unified communications, social business tools and video conferencing or some blend of them, but there’s a simple first step – get the mobile phones onto the same footing as desktop phones. This means that the mobile phones of remote workers are seen just like their deskbound colleagues as extensions of the PBX; calls can be simply transferred and everyone can pick up their responsibility on a hunt group. Rather than lone wolves and road warriors everyone can be seen to be on the same team.

It doesn’t matter whether this is delivered by on-premise equipment or a hosted service, although for many smaller organisations or those for whom a PBX upgrade is not on the short terms plans, a cloud based service might make most sense. As for players in this space, there are plenty to chose from, including mobile operators (Vodafone’s One Net, AT&T’s Office@Hand), telecoms and PBX hardware vendors (Avaya, Aastra, Alcatel-Lucent) and specialist communications providers (Gradwell, Calyx, Sangoma, Gintel).

The key questions to ask service providers are similar to those for other cloud applications around service assurance, reliability, scalability and security, but for mobile integration there are other issues to consider too. It is important to understand costs, especially when calls are being re-routed, and if there are any limitations or additional costs when roaming.

This may only be a first step on a much more sophisticated and involved route towards unified communications, a collaborative workplace and desktop video conferencing, but these require an even greater evolution in working practices and the business culture, which will rarely happen overnight.

The functions of the switchboard – from simple call divert, waiting, transfer and pickup to more sophisticated features – are well used and understood and therefore easily adopted. It is a far simpler task to extend this to mobile phones – whether employer provider or employee owned – to provide more cultural structure and team cohesion to distributed individuals.

By all means unify your communications, but unify your people first.

By: Rob Bamforth, Principal Analyst, Quocirca Posted: 13th April 2012 Copyright Quocirca © 2012

Anyone who has had reason to contact a large organisation – bank, telecoms company, utility, government department – will have noticed some changes in the last decade or so in how these organisations communicate. There has been a shift from having a physical presence to communicating via telephone and/or online; visiting a branch office has been replaced by interactive voice response (IVR) phone systems and ‘check on our website’; letters of complaint by emails and webchats.

The reasons are simple – cost and scale.

The demands of customers have grown beyond the ability of points of contact to adequately respond; insufficient branches, too short opening hours, insufficient contact centre staff. Customers expect to be able tocommunicate at any time with people who know who they are, the history of the relationship and direct them to experts who can solve the problem instantly. It should be no surprise that organisations find it a challenge to meet this level of customer expectation – especially as they try to maintain or boost margins, shareholder returns, and ultimately perhaps executive bonuses?

Hence the move to get people to phone or look it up online. Use automated systems where possible, and even when real people are required, lump them together into call centres and consider outsourcing them to countries where the rates of pay are lower. In the meantime, the call centre has changed to embrace new technologies and more flexible ways of working, evolving into the contact centre. No longer necessarily a physical place, but a virtual web of people and locations using diverse modes of communication to deal with customer requests. 

All well and good, but frequently all the customer hears or sees is the equivalent of ‘computer says no’ and the website or IVR does not have the option they are really trying to find. All too often they might feel the message “your call is important to us…” tells them just how important they really are (Not very, otherwise there would be more staff to answer the call)

The problem is not necessarily in the technologies used, but the way they have been adopted. Automated systems have allowed companies to become lazy with their processes. They create streamlined processes that fit the perceived needs of the majority of customers but rely on automation and associated tools like a crutch. This then allows the business to have lowest cost staffing and to try and forget about exceptions.

Processes streamlined, costs cut, large volumes of customers handled – job done? Well not really as most of these same organisations notice their customer loyalty falling and churn rising, especially when regulators get involved to make the process of switching easier as they have in many industry sectors.

The problem is that while these processes address issues that impact the organisation, they do not always tackle those issues that have greatest effect on customers. This is especially the case with so called ‘exceptions’ i.e. the things that companies have not included in their processes, but tend to happen to their customers with more regularity than admitted. The problem is further exacerbated by reliance on the process as the final arbiter, and not the discretion of well-motivated and well-trained customer service employees who have been granted authority to act on their own initiative.

However there are examples of solutions to this problem through the use of social media for customer support. Here, connection is simple, contact is rapid and the ramifications can ‘go viral’. Perhaps for these reasons it becomes important to select good and well-motivated staff, give them responsibility for their actions and reward them appropriately.

Consumers will often hit their social web for unresolved issues and complaints, news of which breeds in the oxygen of widely shared experiences – “yes, something similar happened to me with…” and spreads rapidly through the Twitterverse, blogosphere and Facebook pages. Customer service teams that interact with customers through social media need tact and diplomacy couple with the ability to deliver empathy in simple text, sometimes fewer than 140 characters. They also need the same direct access to customer records and powerful support tools for data mining and root cause analysis as all other customer care channels.

Companies in the telecoms industry appear to have recognized this, and there are highly visible and responsive teams operating on behalf of BT, VirginMedia and Vodafone, among others. Anecdotal evidence suggests these people are already delivering excellent service and this seems to come from them being small, highly focused teams, close to the core of the organisation, able to call on resources as they need them and make decisions on their own initiative.

This model changes customer service in a far more positive way that the over-simplistic and ill thought out deployments of automated telephony and web technology. By taking the best of IT and communications tools, but putting people at the core of processes, organisations can improve their customer service and more importantly perhaps from their perspective, retain customers. 

Organisations would do well to step up their investments in their social media customer support teams. The computer may say no, but the people say yes.

By: Rob Bamforth, Principal Analyst, Quocirca Posted: 3rd April 2012 Copyright Quocirca © 2012

There can be no doubt that use of social media for external enterprise communications is on the rise, as noted in Quocirca’s recent report “Community, connection, conversation or channel”, however its role in internal communications could be more significant. The questions raised are, why, how and what will it replace?

There are rumblings from some analysts about the demise of email. As a universal external medium, this is most unlikely in the short term, but there are already companies contemplating and even moving in this direction internally. The most visible recent pronouncement has been from the IT services firm Atos, where, after a realization that around 85% of emails were a waste of time, its internal use has been banned.

This could be seen as only addressing a symptom rather than root cause of the messaging overload problem. After all why are employees sending each other so many worthless messages? And as employees will still need to communicate with each other, what will they use instead of email and how will that be different or more efficient or will they simply replicate old bad habits in a new medium?

The thought is generally that other forms of more instant communication will ‘pick up’, in particular those oriented around real time interaction, such as instant messaging and social media. However, while these have the right viral qualities for user adoption, the boundaries between social and work are not as clear as they should be for achieving the end goals – more efficient communication and more productive staff.

Implementing enterprise social media tools might be a good approach for reducing communications stress and improving efficiency, but exactly how to go about it is not always clear – should it be a grass roots initiative or something mandated from the top?

The path taken by insurance technology and software provider, Agencyport, with regard to enterprise social media, is very interesting and demonstrates some surprising and unexpected value from the process, in addition to the hoped for benefit of using new communications tools.

Agencyport is by its own admission not in the most ‘glamorous’ industry sector, but recognizes it has to be very customer centric and understands the value of being highly responsive to its customers’ needs and the changes and challenges that are affecting them. It had an internal appreciation of the challenging impact of change too, through a recent acquisition which led it to become a global company with a distributed presence and therefore a mixture of corporate as well as regional cultures to deal with.

Within the organisation, there was a realisation that it needed to sort out its internal and external communications confusion and thought enterprise social media would help. Not knowing the market, some research was undertaken and a tool was chosen that had not been well known internally, Yammer, and they just dug in.

Although there was an ‘official’ launch, it was first tested with a select group of employees. The relatively young workforce – the majority being aged under 40 – took to it rapidly and within a week it had gone viral well beyond the initial trial group, even prior to the official launch. Within a matter of months adoption was over 95% of the workforce, and two thirds are now active members posting and using daily.

The use of other social media tools within the workplace is not uniform, and although some offices are allowed to use public sites such as Facebook, others are not permitted because of their need to hold and securely manage customer data. Employee usage of Yammer has become ‘Facebook at work’, where employees realise they have to behave differently.

There were early problems with informality when some employees forgot where they were, but Agencyport did the right thing and set out a few simple rules for acceptable use, rapped knuckles where they were transgressed, and now everyone behaves responsibly and professionally. There is no need for a long dusty company policy handbook sitting on a shelf if a few common sense rules are uniformly applied.

So has Yammer replaced email for Agencyport? Yes and no.

Massive emails and long trails that are forwarded and replied to all as a self preservation mechanism have all but dried up, but the sort of chat or email exchanges between two or three people have not. The social media direction of Yammer has lead to a change towards increasing openness and dialogue, instead of edicts and management controls.

Rather than the formal hierarchical chains of command and artificial silos of departmental secrecy that often pervade organisations as they grow, Agencyport found that small ad hoc working groups formed to fix issues and work through problems. Conversations now happen spontaneously and their use of Yammer is peppered with a large number of specialist groups, which form the online conference rooms and water coolers for the company, irrespective of physical location.

This is a major unexpected side benefit as the company, emerging from an acquisition, with new international locations and employees uncertain how to integrate in a new organisation.  It now has a common culture and a medium of efficient information exchange that span the entire organisation. Structure has emerged out of the chaos rather than being imposed; employees are happy and the business is thriving. Enterprise social media has given the organisation more than just a way to communicate better, but a way to think and feel better.

By: Bob Tarzey, Service Director, Quocirca Posted: 1st November 2011 Copyright Quocirca © 2011

People of a certain age often enjoy recalling for younger folk the size of the early mobile phones that were lugged around in the mid-1980s, whilst marvelling at the latest smartphones. These brick-sized devices could not even send text (SMS) messages (the first of which was sent in 1992); they were good for voice only. But, what would it have taken almost three decades ago to have had all the capabilities of a 2011 smartphone based on the available technology of the day?

This was one of the subjects covered in a recent New Scientist article titled “They said it couldn't be done: 7 impossible inventions”. To quote the article:

“The components for the iPhone à la 1985 we've listed so far would fill a large wheelbarrow. But we have left out something important.”

“The processor at the heart of the iPhone 4 can perform up to a billion operations per second (the new iPhone 4S is even zippier). You might have matched that in the mid-80s if you had bought the Cray X-MP, then the world's most powerful supercomputer. But the Cray would have filled an office cubicle and also required an industrial-strength refrigerator to remove the waste heat. So cancel the wheelbarrow. To haul the 1985 iPhone around, we're going to need a truck.”

Interesting stuff, which underlines why the consumerisation of IT has become such a big issue. When I left the academic world for the commercial one in 1986, for the first time in my life, on my desk at work I had dedicated access to a computer (albeit a text-only dumb terminal) which was linked to a network providing me with any information my employer had stored that it felt would be useful to do my job. I also now had a telephone with its own number; my friends and family could now contact me when I was at work (before that hand written letters had been the main method).

The new entrant to the work place now has all this and much, much more in their pocket. This is the issue driving IT consumerisation. Employers can no longer impress new recruits with technology and connectivity, they are more likely to disappoint. Competitive employers today are those that allow their employees to use the advanced technology they have become used to at home in the workplace.

Consumerisation does of course throw up many challenges, not least how data security, contracts and billing are handled. These issues were discussed in a recent free Quocirca report “Carrying the can” sponsored by ttMobiles and the subject of a recent conference organised by the Wireless Improvement Group (WIG). Quocirca’s presentation given at the conference can be downloaded here.

By: Julian Holmes, Co-founder, UPMentors Posted: 18th March 2011 Copyright UPMentors © 2011

A change is taking place in the IT Industry that has a major impact on the way organisations should now look to recruit software development people. The so-called ‘hard skills’—such as an applicant’s technology skills, qualifications, and certifications—should simply be an entry requirement and a greater focus should be placed on the ‘softer skills’.

The core competencies that a recruiter should now be looking for are the behavioural skills. Whilst these are sometimes difficult to extract, a skilled recruiter with a competency-based recruitment method should be able to identify applicants who will not only suit new ways of working but also enhance the team. 

What are the competencies organisations should now be looking for?
Competencies such as a team-player, excellent communication and collaboration skills, results orientated, the ability to pick up new skills quickly, to see the ‘big picture', flexibility, someone who embraces change and a ‘can do’ attitude, to name just a few. Some organisations may already feature these as part of their profiles for candidates, however these should now be a prominent part of the recruitment process, with new employees required to perform each to a high level on a daily basis. 

What is driving the change in focus?
The growing adoption of agile software development practices has significantly changed the way project teams work. No longer are they required to work as technical specialists in silos but are now expected to work in cross-functional teams, often with direct customer contact, to understand the business challenges and to enable them to deliver the right solution.

The success of these agile teams is directly related to the ability of the team to ‘gel’ together to deliver high quality software. This way of working is a significant departure from the traditional approaches to software development. The challenge for HR departments is to strategically align their recruitment policy and practices to support software teams and deliver candidates who will not only fit with the new ways of working, but enhance and develop it further to the benefit of the team, organisation and the customer.

About UPMentors
UPMentors helps organisations to successfully deliver and cope with complex software projects by transforming people’s capabilities. Using a combination of consultancy and specific practices such as knowledge transfer, leading by example, mentoring on-the-ground and various training techniques, UPMentors gives software professionals the capability to work more effectively as part of a team and prevent project failure.

As a trusted external resource, UPMentors challenges the mindset of how training is delivered across the business; it removes unnecessary overheads, company politics and bureaucracy while streamlining the entire software development process. The company specialises in several software development processes, including Agile and Unified Process variations.

Founded in 2007, UPMentors works with large enterprises across a wide range of industry sectors; clients include Capgemini, ING Direct and HM Revenue & Customs.  For further information, please visit www.upmentors.com

By: Rob Bamforth, Principal Analyst, Quocirca Posted: 19th November 2010 Copyright Quocirca © 2010

Despite the claims of many marketing brochures filled with words ending in ‘-ability’, there are only three real tangible benefits to consider when evaluating a product or service; value, cost and risk. When it comes to turning the bottom line from red to black – as is often the case during recession and government cuts – companies generally look to just one of these – cost cutting.  Its counterpart – value growth – whilst popular during boom years is far harder to find in a downturn. It requires companies, and more often individuals, to go out on a limb; something they are much more wary of as they look to protect their own position.

This leaves the third benefit – risk mitigation. On the face of it this seems a negative subject only to be addressed when something goes horribly wrong.  A catastrophic disk crash introduces many to the concept of regular backups. A security breach highlights the vulnerability of data assets. A volcanic eruption highlights the value of alternatives to air travel and buying comprehensive travel insurance.  Adaptability and flexibility help reduce risk; these ‘-abilities’ in particular can deliver real benefits, allowing agile organisations to pounce on unexpected opportunities as well as stave off unforeseen problems.

Hence, when problems create opportunities, a lack of flexibility can often get in the way of capitalising on them.  An example of this was apparent during the travel crisis as a result of the ash from the Icelandic volcano eruption.  It was thought that some travel operators were profiteering by ramping up the cost of one-way ‘cheap’ tickets by hundreds of pounds.  However, those travelling would have been surprised to see quite a few empty seats on the plane.  Presumably, those with tickets booked as returns but unable to travel on the outward leg didn’t show up, leaving a raft of available seats only identified at the departure gate.  Many companies with tight booking processes appear to have no way of reselling those seats as ‘standby’ on a first come, first served basis at the airport – or over the web.  Filling even 5 extra seats on a plane would have been massively profitable for the airline concerned.  It might be tricky to introduce with current systems, but a more adaptable model of reselling empty seats might have done wonders not only for the bottom line but perhaps also avoiding the negative media perception of air travel that was created by the crisis.

When problems occur, it also leads to a positive view of those who can cope in these sorts of crises – for example, when large numbers of workers were disrupted by apparently unexpected heavy snowfalls in the UK in early 2010 (well, it was in winter).  Mobile phones, laptops and remote access to enterprise systems are all now in widespread use.  Those organisations that had implemented more flexible solutions or worked with more flexible suppliers, were able to manage the sudden increase in user load as everyone equipped to occasionally work remotely did so all at once.

It is not only limitations or constraints in the technology that amplify problems when a glitch occurs, but also lack of flexibility in service offerings, levels and tariffs.  Businesses should no longer simply look for the cheapest options, even during a recession, but those that deliver the best overall value.  This means putting a value on flexibility.

Flexibility can be supported by appropriate use of suitable technology, but it really comes into its own when there is the right commercial framework backing it. No wonder then that ‘as a service’ models are springing up to offer a pay as you go model, where incremental changes in either direction are simpler to make.  Whether we call this cloud, hosted, managed or on demand doesn’t really matter, the value is about pushing the complexity and upfront costs onto someone outside who’s a specialist, and then renting the service back from them.

Need more software licenses to cope with a sudden surge or more bandwidth at the end of the month, or perhaps fewer desks and phones as you’ve moved office workers to a ‘hot-desking’ model? No problem – the service provider will “flex”

This flexibility goes further, as the rented service can be delivered ‘anywhere’, no longer tying its use to specific locations or office premises. Mobile working, not as in working on the move, but moving the place of work, becomes a doddle right?

To a point, but with all of the benefits of flexibility, there has to be some consideration and evaluation of what has been given up to get it.  The main challenge is dealing with a loss of top down control. When something critical is outsourced, hosted on an external server, or available anytime from a cloud at the end of a network cable, can you really trust that the network or service provider can deliver the quality of service you need, or that your data is really secure? These are assurances that must be sought, rather than seeing such services as a money saving exercise, and there are now many companies able to deliver safe, secure and reliable services.

More mobile and flexible working looks on the face of it to benefit both employer and employee, but there are caveats, and again it boils down to quality of service and assurance. Management tools and processes need to evolve to convince some managers that employees are not simply engaging in social network conversations, playing games or surfing the web while ‘working from home’. Similarly employees need to be assured that “off” means “off” and expectations of 24/7 availability, simply because the network is there, are not fair.

Applying suitable metrics for measurement and controls to ensure goals are met will become an increasing challenge in dealing with both employee and service provider flexibility.  The old metrics of hours in the office and narrow objectives will no longer work for many individuals, just as network outages will no longer be sufficient for measuring service provision. Part of the problem in working out new business goal oriented metrics is that companies have been based and built up on a rigid top down hierarchical command and control system.

This is where flexibility still needs to be applied by many organisations. When it is perhaps some of the apparently chaotic concepts that have emerged in IT and communications – the internet, open source, ad hoc collaboration, social networking – will ultimately lead to a new flexibility in management systems.

By: Dana Gardner, Principal Analyst, Interarbor Solutions Posted: 17th November 2010 Copyright Interarbor Solutions © 2010

The rapidly changing and fast-growing opportunity for more businesses to reach their customers and deliver their services via mobile applications is at a crossroads.

Over just the past two years, the demand for mobile applications on more capable classes of devices, such as smartphones and tablets, has skyrocketed. Now businesses need to figure out how they can get into the action.

Small and medium-size businesses (SMBs) especially need to reevaluate their application development and end-user access strategies to be able to deliver low-cost yet impactful applications to these newer devices. This goes for reaching employees, as well as partners, users, and customers.

Hopefully, there's a shift in the skills required to put these applications on these devices and distribute them. The emphasis on capabilities is moving from hardcore coders -- with mastery of embedded platforms and tools -- to more mainstream graphical and scripting-skilled workers, more power-users than developers.

This sponsored podcast explores how mobile application development and the market opportunity are shifting, and how more businesses can quickly get into the mobile applications game and build out new revenue, share more data, and provide better direct customer access in the process.

Our panel consists of Roger Entner, Senior Vice President and Head of Research and Insights in the Telecom Practice at the Nielsen Co., and Wayne Parrott, Vice President for Product Development at Genuitec. The discussion is moderated by BriefingsDirect's Dana Gardner, Principal Analyst at Interarbor Solutions.

Here are some excerpts:

Entner: About 50 percent of all devices being sold in the US right now are smartphones. We expect smartphone penetration to be at about 50 percent by the end of next year. Almost 60 percent of smartphone owners are actually using applications. That’s a huge percentage.

We're now at that sweet spot where it makes a lot of sense for businesses to have applications both for their consumers and their employees alike, because there is enough of an addressable base there.

We just launched our second edition of our Mobile Apps Playbook. But to quote numbers from there, year-over-year second quarter '09 to second quarter '10, smartphone penetration in the US went from 16 percent to 25 percent.

Now, we have 3- and 4-inch screens that are actually readable. We're not just merely replicating a desktop experience, but actually tailoring it to the device and working with the strengths of the device rather than with the weaknesses.

The devices that we call now smartphones are little computers that today are as powerful as laptops a few years ago. I always say that this little thing you have in your hands, a smartphone, has far more computing power than was used by NASA to put men safely on the moon and bring them back alive.

Applications becoming easier

And now Apple, Google, Microsoft, and the others, have software development kits (SDKs) out there that make app development a lot easier than it has ever been.

If you have a talented developer or a talented person in your department, he might be able to build that internally. Or, there are now myriad development shops out there that have the capabilities to build applications and charge only a few thousand dollars -- and that's single digit thousand dollars -- to have a capable, usable application.

There are a lot more people who know how to program these things, and have good ideas of applications. There is a really good market out there to put the two together.

Parrott: We’re seeing a big move toward interest in mobile at the development side. What are the factors that’s really led to the explosion of mobile apps? It's not only the smartphones and their capabilities, but we also look at the social changes in terms of behavior.

People more and more have a higher reliance on their smartphone and how they run their lives, whether they are at work or on the move. The idea is that they are always connected. They can always get to the data that they need.

Basically, we're taking their lifestyle away from their desktop and putting it in their pocket as they move around. More and more, we see companies wanting to reach out and provide a mobile presence for their own workforce and for their customers.

The question they ask is, "How do we do that? We already have a web presence. People have learned about our brand, but they can't access this through their smartphones, or the experience is inferior to what they’ve come to expect on the smartphone."

We're seeing a big growth of interest in terms of just getting on to the mobile -- having a mobile presence for the SMBs.

Still a great deal of complexity

If you take a look at the current state of native mobile app development, it's really not much better than it was five years ago. You still see a strong fragmented programming model base, different operating systems, and different hardware capability. It's still a mess. You pretty much have to pick a subset of devices that you want to focus on.

Entner: If we take one little step back, one of the genius things that Apple has done is turn the bookmarks into an application. About 60-70 percent of all applications on the iPhone or an Android are actually glorified HTML ports. So, it's not that difficult or that demanding on the application side.

One new trend is HTML5, which is slowly but surely approaching. There has been no finalized HTML5 standard [from the W3C], but a lot of web browsers, and even mobile web browsers, have now some HTML5 capabilities. And, it will really help in the development cycle for basic applications.

Where HTML5 will not to be able to help us, at least right now, is when we try to take advantage of location-based services because there is no standard yet. They're still arguing about this one, and especially high performance graphics. But, on the standard application, HTML5 will take us miles forward and diminish the difference between the desktop and the mobile environment.

... At the same time, all of the SDKs are getting more powerful and more user-friendly. So, it's moving toward a more harmonized and more rapid development environment.

Parrott: Prior to HTML5 talking about mobile web was pretty much a joke. Mobile web was an afterthought in the phone market. You had these small, dinky displays. Most of them couldn't even render most standard HTML. What's new?

You still see a strong fragmented programming model base, different operating systems, and different hardware capability. It's still a mess. With the advent of the smartphone what you really saw was pretty much the Internet, as you experience it on your desktop, now on to your smartphone, but with even more capability.

Part of it is because HTML5 has stepped back and looked at what the future needed to be for a web programming model. To become more of a common run-time, they had to address some of the key gaps between native hardware, APIs, and web. Much of those have really centered on one of the biggest digs that mobile web had in the old days, when you were doing something, were connected, and then you lost your connectivity.

Out of the box

HTML5, right out of the box, has a specification for how to operate in an online, offline, or disconnected type mode. Another thing was a rendering model, beyond just what you see on your desktop, that actually provides a high-end graphics type capability -- 2D, 3D types of programming. These are things that more advanced programs can take advantage of, but you can build very rich desktop type of experiences on the laptop.

Then, they went beyond what you're used to seeing on your desktop and took advantage of some of the sensors that these phones have now -- accelerometers, location capability, or geolocation. APIs are now emerging as a companion to HTML5, which is a spec that will span across your desktop to the mobile phone. It's a very capable specification.

In addition, there is the movement in terms of the standards body, especially the W3C, to address mobile device API. You will eventually program in a standard way and talk to your contacts list, your cameras, video, recording devices, and things like that. That will soon be available to us in a web programming model.

What used to be exclusively the demand of the hardware API guys to do really low level, high performance bit twiddling is now going to be available to the general web programming masses. That opens up the future for a lot more innovation than what we’ve seen in past.

There is enough HTML5 core already emerging that we could start to program to a subset of that spec and treat it as kind of a common run-time that you would program across pretty much all of the new emerging smartphones as we look forward.

Entner: It's only a matter of when ... HTML5 will come. Apple and Google are at the forefront and are already launching websites and services in it. You can get HTML5 YouTube, HTML5 Google, and even Yahoo mail access. You can have the Apple website in HTML5. It just depends on what is fully supported right now.

Some browsers support it, and some don't yet. On the mobile side, it also fully depends on what is supported. If you have the WebKit engine at the core of the browser that your device is using, HTML5 is pretty widely supported.

Parrott: As we've talked to more-and-more of our SMBs, one thing that stands out is that they don't have a lot of resources. They don't have a huge web department. Their personnel wear a number of hats. Web development is just one of n things that one of the individuals may do in one of these organizations.

At Genuitec, we developed a product called MobiOne Studio. The target user is anyone who has an idea or an vision for a mobile web application or website. MobiOne is geared to provide a whole new intuitive type of experience, in which you just draw what you want. If you can develop PowerPoint presentations, you can create a mobile web application using MobiOne.

You lay out your screens, you pane them all up, and then you wire them together with different types of transitions. From there, you can then immediately generate mobile web code and begin to test it either in the MobiOne test environment, that's an emulated type of HTML5 environment, or you can immediately deploy it through MobiOne to your phone and test it directly on a real device.

If you can develop PowerPoint presentations, you can create a mobile web application using MobiOne.

With MobiOne Studio we recognized that the first thing that most companies want to do is just mobilize, just get a mobile presence, mobilize their websites, and have that capability. As Roger said a while ago, a lot of the apps you see out there are really glorified mobile websites and are packaged up in a binary format.

Second Studio phase

In MobiOne Studio's second phase, once you design and you like what you have, you have a progressive step that you can go from a very portable form to compile it down -- or cross-compile -- from HTML5 to whatever the native requirements are of that particular target app store. So, Google will have their app store, and Apple and RIM each has their own model. They are all fairly different models.

But with HTML5, you can go directly to your customers now. You can market to them directly. It depends on your way of interacting with your customers, but we have seen a number of novel approaches already from some of our customers. When any customer is in your store, you make it very easy for them to access your site, to make them aware of your mobile capabilities, lure them in, and get them connected that way.

Listen to the podcast. Find it on iTunes/iPod and Podcast.com. Read a full transcript or download a copy. Sponsor: Genuitec. Learn more.

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By: Gerry Brown, Analyst - Digital Marketing & CRM, Bloor Research (Moved) Posted: 25th October 2010 Copyright Bloor Research © 2010

Last week I looked at the effect of open source and new agile vendors such as Qliktech on the BI market in the article ‘Is the Traditional BI in decline?’. Is the CRM market similar or different?

As with the BI industry, the heavy boot prints of the large enterprise applications vendors, SAP, Oracle, and Microsoft are all over the CRM industry. Also similar to the BI market, most of the CRM old stagers are still hanging in there, many albeit under new ownership e.g. CDC (Pivotal) Sage (Saleslogix), Pegasystems (Chordiant), Consona (Onyx). The CRM market during the last decade has been a roller-coaster with many vendor casualties, whereas the BI market has grown in a more linear fashion.

The most successful CRM vendor in recent times has been salesforce.com which now has $1.3Bn in revenue, 4,500 employees, and has grown its revenues in the $250–$300m range for each of the last 3 years. Salesforce loves to spend money (c. 50% of its revenues) on sales and marketing, especially for its mega Cloudforce conferences that provide the speaking platform for its charismatic and outspoken CEO, Marc Benioff.

Salesforce is great for the CRM SaaS market and its cousin the open source CRM market in ‘taking on’ the rhetoric of the enterprise vendors. One vendor described Benioff as a ‘lightening rod’ for attracting media attention: “we just enjoy being in the salesforce.com slipstream”.

Unlike BI, where there are relatively few open source vendors, in CRM applications there are at least 60 open source CRM packages regularly downloaded from Sourceforge. The crown prince of the market is SugarCRM.

SugarCRM, like Qliktech in the BI market, is growing revenues at over 50% per annum. It claims 7 million downloads and serves 600,000 end users. 6,000 customers have the ‘paid for’ SugarCRM Professional or Enterprise editions. The Professional edition starts at only $30 per user per month on an annual subscription contract. The new version SugarCRM 6 incorporates an intuitive interface, social CRM and search functions that keep it pretty much in touch with the product developments of the mega vendors.

SugarCRM is a low cost alternative to salesforce.com, Microsoft and Sage for Sales Force Automation (SFA). In addition SugarCRM offers some basic call centre support features and marketing functions such as campaign management. A key strategic question for CRM suppliers is whether to stay focused on the triumvirate of Sales / Marketing / and Customer Support applications? Few, if any, vendors do all 3 of these applications brilliantly today.

The alternative is to branch out wider into integrated Accounting and eCommerce as a SaaS-based small business suite, as Netsuite or up-and-coming UK vendor Brightpearl do. The latter offers the Brightpearl CRM / Accounting / Time Management suite all for just £20 per user per month.

In summary, the CRM market is still growing nicely and is now well out of its early adolescent growing pains. Some segments of the market, such as SFA and marketing campaign management, are starting to look increasingly commodity in nature, as tumbling prices and the many SaaS and open source alternatives are testament. Customers should choose vendors with strong strategies, and who are willing to continuously innovate in products and their own business models in order to remain competitive. Salesforce.com has shown remarkable agility and foresight in this regard to date.

Always a good sign is when the venture capital (VC) community is prepared to sign the cheques. To date, SugarCRM has raised $46 million in VC funding and an IPO in the future seems likely. So maybe the CRM market looks like a pretty good place to be after all.

By: Rob Bamforth, Principal Analyst, Quocirca Posted: 15th October 2010 Copyright Quocirca © 2010

The term ‘unified communications’ conjures up many meanings, but is most often used by those with software or network assets to sell. Whether it is routers, switches, hubs, directories, phones or high definition video conferencing equipment, the thrust is often the same—we have the hardware to remove complexity from your network and software to unify those different modes of communication that your users ‘enjoy’. Basically it’s the IP dividend of voice over IP (VoIP) mixed with video over IP plus anything else over IP with a bit of contextual status thrown in via ‘presence’.

Sounds good to those managing a complex mix of networks, or those paying for separate forms of connection when they can see what looks like a great big free (or perceived to be free) fat internet pipe that will take all IP traffic. Unify the packets over IP and you’ve unified communications, right?

The problems come when trying to see how users fit into the deal and it does not always end in a fully cross functional, matrix managed, dispersed workforce collaborating all the way across the extended enterprise. The technology is fine, the commercial aspect works, but the social side just does not deliver, because it depends on acceptance, initiative and commitment from the workforce, and generating that takes more work than installing a CD or network appliance.

So how about taking a different approach?

There is much talk about the influx of consumer technology into the workplace, and an interesting area to look at here is social networking. However this time it is not about the use of social networking tools to connect with customers, reinvigorate marketing budgets or make the business look cool. Nor is it about the fears of employees spending so much of their time glued to their social networks that they forget to work, or how to interact with real people; although these issues do merit some attention from organisations.

An aspect of social networking that might catalyse and support the broader adoption of unified communications is the current trend towards ‘social dashboards’. These are coming about partly in recognition that most people like and use a multiplicity of social communications tools—YouTube, Facebook, Twitter, LinkedIn, instant messaging, email etc—to hook up with their friends and contacts, yet would like to avoid the complexity of using these as separate applications. A single live ‘portal’ embracing the other tools would be ideal, but who would be the master site/supplier?

It may be too early to narrow down as there have been false dawns and social networking failures, but current players are positioning themselves as ‘accommodating’ as the market evolves. Recent innovations and updates from Microsoft around Live Essentials and the new look Twitter are examples of the trend towards this.

So what is a ‘social dashboard’ and what are the characteristics that have merit for consumers, which might turn out to be a valuable in a business context? There are several recurring themes:

• Feeds – these are live updates, tickers, messages, blogged and tweeted lifestreams or even streaming audio and videos. Ever present, constantly updated without the need for the recipient to make requests.
• Finds – uploaded responses or comment using scraps of information, interesting webpages, uploaded photos and videos can be simply and easily fed in and propagated to all contacts, ‘inline’ and without the need to open new windows or be diverted by separate applications.
• Feedback – instant opinion and comment on feeds and finds from all those in the network, a loose collaboration, trending and sometimes herd-like behaviour in the crowd. Voting and recommendation engines might seem too democratic for business decisions that need top down command and control, but with suitable moderation there may be wisdom in the crowd.
• Filters – the key to making sense of a cacophony of information. Filtering by areas of interest, favouritism dependant on the contact type (e.g. messages from the boss, or the activities of a key customer), current activities or status (do not disturb, busy working, on holiday so friends only etc). Organisations may also be able to push down centralised policies to provide automated filtering and implement security measures to block malware, filter inappropriate content and mitigate risky behaviour or data leakage, as well as permit more personal policies to improve productivity by adapting to ensure information is relevant to the context of the place, time and person.

Finally there is also the underlying ability to grow the network by finding contacts, or suggesting potential friends. When applied with business intelligence, this mechanism of seeking out the right person to contact would be extremely useful in many organisations where the traditional ‘org charts’ are always out of date or the sheer volume of external relationships make the divisions of ‘employee’ and ‘contractor’ meaningless.

Buddy lists and presence directories are already part of many unified communications solutions, but they could go a lot further to envelop the groups, commonalities and relationships that people really build their personal communications networks on. Simply having a directory with phone number, contact details and current status or presence is not enough, and the social network element provides some provenance, knowledge of, or social value of the contact. Social networks have meaning attached to the link as well as the point of the connection.

Many unified communications vendors have overly focused on the networking technology and forgotten the key part of communications; it is about people. Perhaps they could learn something relevant for businesses from social and consumer oriented tools?

By: Simon Holloway, Practice Leader - Process Management & RFID, Bloor Research Posted: 1st October 2010 Copyright Bloor Research © 2010

We all know that Manufacturing is all about products and that you have to keep reinventing your product portfolio to keep ahead in today’s market. Perhaps what it is not so well known is that the majority of R&D products don’t even make the market and of those that do only 1 or 2 really make a worthwhile profit. Therefore product development is a risky business, but one we can’t avoid. So how can we limit the risks and get better control of the process of controlling the life of our products?

Andy Michuda, Chief Executive Officer of Sopheon told me, “Product life cycle management (PLM) is the most vital business process in manufacturing today. A right decision on which product ideas to develop and produce can transform a company’s future. A wrong decision can bring a company to its knees. In the race for growth and profitability, the capacity to understand and act on PLM’s power will separate the winners from the losers”. But what exactly is PLM? There seem to be no standard definitions of PLM—everyone has something slightly different to say. Even the site http://www.product-lifecycle-management.info has a number of different definitions!

Let me give you my condensed definition of PLM. “It is the business process of managing the entire lifecycle of a product from its conception, through design and manufacture, to service and disposal. It integrates people, data, processes and business systems and provides a product information backbone for companies as well as their partners, suppliers and customers.” PLM is first and foremost a business discipline, whose goal is to eliminate waste and improve efficiency, and is considered to be an integral part of the lean production model. However, because of the business complexity and rate of change that requires organizations execute as rapidly as possible, application software is becoming more and more crucial to the success of PLM. It is one of the four cornerstones of a corporation's information technology structure. Shoenhair of Ping, a PTC Customer, supports this view: “PLM can be difficult to measure, but it is absolutely critical to leaning out processes, and critical to improving information flow and control.”

Where do ERP and PLM fit? Most manufacturing companies distinguish two main process chains: the operational process chain and the technical process chain. ERP systems largely address the operational process chain, whereas PLM systems automate and enable predominantly the technical process chain.

Figure 1: ERP and PLM (Source: PLM Technology Guide)

Johan Malmström, PLM Business Development Manager, SAP, emphasised the collaborative nature of PLM, “PLM makes sure that everyone works towards one version of the truth, with clearly defined tasks and responsibilities. It manages the product structure and related information, the usage of this data across the product lifecycle as well as the process of creating this data. Process support includes workflow capabilities, program and project management, resource management etc. to make sure that the correct resources are working on the correct tasks in order to deliver the right products to the market in the right time.”

Michuda explained that PLM is implemented in practice on three different levels, each of which is supported by a different tool set.

• Transactional Processes: Enterprise resource planning (ERP) applications manage transactional processes. They are designed to unify materials planning, purchasing, financial transactions, accounting and reporting into streamlined transactional processes. Supply chain management (SCM) and customer relationship management (CRM) applications also address process needs at this level.
• Technical Data: Computer-aided design (CAD) applications, as well as those related to formula, recipe, or product data management (PDM), are primarily focused on managing the masterfile of descriptive data within the product lifecycle. These PLM systems streamline and continuously improve the processes of defining, designing and producing products, while potentially also supporting aspects of product innovation. They offer collaboration capabilities that enable enterprise-wide sharing of product designs, reducing the chance of design and manufacturing errors.
• Business Information: The business level of PLM deals with business issues around critical business-related decisions within the product lifecycle. At the business level of PLM, the emphasis is on solutions that handle innovation governance issues such as process management, decision support, idea management, product portfolio management, expertise management, and intelligence around markets, competitors and technologies. Regulatory compliance and sustainability that important not only during product innovation but also to effective management of the supply chain are also included within the business level.

So what tools are used in a PLM solution? The PLM Technology Guide shows the core technology of a PLM system and some of the many solutions that can rest on the basic technology. The orange line outlines Product Data Management (PDM), which is typically used for basic CAD file and Data Management.

Figure 2 PLM Functionality Source:  PLM Technology Guide

Who are the main players? The major players in PLM space can be grouped under 3 broad categories:

• PLM product vendors such as Dassault Systemes , PTC ,Siemens, Sopheon, Aras
• The ERP vendors such as Oracle Agile, SAP PLM, Infor PLM, Epicor, IFS
• Consulting & implementation companies such as Accenture, Atos Origin, Capgemini, ITC Infotech, IBM, Infosys, KSA, Wipro and HCL Technologies.

What is coming? Dassault Systemes, on their web site, describe PLM v2 – “PLM 2.0 is a major redefinition of the PLM markets targeting all users creating, consuming and remixing IP. PLM 2.0 is to PLM what Web 2.0 is to the Web, harnessing collective intelligence from online communities. Any user can imagine, share and experience products in the universal language of 3D. PLM 2.0 brings knowledge, from idea to product experience (IP), to life. It merges the real and virtual in an immersive lifelike experience.” SAP’s Malmström sees the following three trends:

• Consumer-Driven Sustainable Innovation: with a focus on developing the right products at the right time in fast innovation cycles.
•  Global Price and Time Pressure: requires development efficiency, sharing of information in dynamic development networks.
• Increasing Product Compliance and Regulations: manage compliance, controls, documentation and visibility.

Mike Spragg, Infor's UK director for the process industries, sees the increase in environmental awareness and the incorporation of the ‘green’ agenda as an area of PLM expansion, “PLM has much to offer manufacturers.  PLM begins at the earliest possible stages of design, meaning these new green considerations are factored in long before products are manufactured and then enter the supply chain. This can save costs that would have to be borne were the products reworked at a later date.”

Deepankar Ghosh, Head – Manufacturing Practice, ITC Infotech, provided a clear idea of the importance of PLM, “PLM industry is comparatively a niche industry which is gaining more currency and acceptance as organizations are realizing the value that the PLM process brings to the table. With an ever increasing pressure on bottom line it is imperative that companies make IT investments where the ROI is not only high but faster. A more informed and demanding customer is seeking not only cheaper but innovative and trendy products more than ever before. For an organization to be ahead of its competition, collaboration across key roles and functions within the company and with its supply chain has become critical. The environment for the PLM practice to grow is just right and we will soon be witnessing an unprecedented interest in this area.”

So, if ERP manages your operations, PLM manages your product portfolio from creation to end of life. My experience of PLM solutions is that they really do provide value—you just need to find the one that best suits your pocket and needs. If that is the case then come along to PLM Connect and find the answer.

By: Rob Bamforth, Principal Analyst, Quocirca Posted: 28th September 2010 Copyright Quocirca © 2010

When you’re been brought up with some IT industry certainties, such as Moore’s Law of transistor doubling or Metcalfe’s Law of network value, it can be daunting to realise that these laws can have other unintended, but significant, consequences.

Metcalfe’s Law says that the value of a telecoms network increases with the square of the number of connections. Whether that rule is precise or not has been subject of some debate, with various proponents of different formulae, but that is not the point.

It has always been pretty clear from the days of the telegraph to phone, fax, web connection or mobile phone that each of these networks pass some sort of tipping point as the number of users soars when the network becomes mainstream.

However, while the total value of each network grows—and that’s great for all those providing products or services in the supply chain—how does it affect individual users? There is, for each individual, the increasing value in being able to reach more and more contacts within the one medium.

After all, being the only person on the planet with a fax machine is pretty useless, but when there’s a few others it becomes marginally interesting, and when all business associates have one it becomes a powerful tool.

But is there a downside to network connection ubiquity?

Clearly some networks become stretched to breaking point as available resources struggle to cope with the demands of increasing numbers of users.

Some mobile networks in particular have been hard hit, dealing with surges in new users or new mobile application usage, with the iPhone and Android platforms being cases in point.

The problem is, once people have a new, highly flexible tool, it is difficult to predict the variety of innovative uses to which it will be put. 

This issue is especially true of communications devices where it is even harder to predict the speed at which innovation will propagate.

But something other than stretched resources is starting to affect the value of networks: a corollary of Metcalfe’s Law is that the larger the physical network of connection points, the larger the social network of people.

This relationship can prove really useful, as it increases the likelihood for example of someone having an answer to that tricky question, or someone being interested in a particular quirky subject, but it also increases the volume of the banal, irksome, trivial and stupid—in short, the more chaff there is to disguise the wheat.

There are further problems in that some of the rubbish clogging the system can be automatically generated, such as spam or email updates that have been signed up for but later regretted—sometimes referred to as bacon. This rubbish propagates rapidly and it is not at all easy to distinguish from valuable communication.

Whether it is search engine results, friend requests, emails or interstitial web pages, there will be some that are too important to miss hidden amid the noise.

Thus as the physical network continues to grow in size its social value growth is affected by increasing viscosity. If there is wisdom in the crowd, the sheer numbers makes progress towards it feel like running through treacle.

At a personal level the effects are pretty clear: constant interruptions, alerts and messages which we deal with by calling it multi-tasking, endless trawling through search engine hits to try to find the thing we were really looking for and so many emails that we fear going on holiday or mitigate the fear by taking a BlackBerry and not really having a proper break.

In many respects this is analogous to the real-world inefficiencies of meetings having too many attendees or the old adage about a camel being a horse designed by committee. However, in both those instances we have built strategies and tools to cope with their worst effects. 

At least in theory, although many fail to put them into practice, which is why the Video Arts short training film from the 1990s “Meetings bloody meetings” still resonates today.

Now remember that the goal of deploying technology was to be MORE productive, not just to have more prods, dead ducks and activities.

This goal means that some artificial constraints may have to be placed on all of this networking, so that personal as well as corporate productivity does not unduly suffer.

It is unlikely that a binary switch—banning social networking during office hours, switching off corporate mobile email during holidays—will work or even be desirable, but, just like the filters that have been put in place for the unwelcome deluge of spam, something automatic will be required.

There are already some social media and content filtering tools and services available, although mostly emerging from the need to curtail access or protect data. These are generally deployed by IT, network and security specialists and justified on the grounds of reducing risks and vulnerability.

However given the increasing risk to productivity at both a personal and organisational level, a new set of tools—or interfaces to existing filters—needs to emerge to be marketed and sold to the line of business management, human resources and individual employees.

It is no longer a technical sell, but if presented and positioned correctly could be knocking on an open door. A flexible and easy-to-use time management solution for the digital age—perhaps Filofax 2.0?—would be most welcome.

By: Rob Bamforth, Principal Analyst, Quocirca Posted: 27th September 2010 Copyright Quocirca © 2010

Technology innovation is often hard to demonstrate to those in senior decision-making roles in most organisations, and generally for very straightforward reasons. Many vendors pitch their products or services as being full of benefits, but often these are simply features dressed up with a few marketing buzzwords ending in ‘ability’. The answer to the question ‘what will it do?’ is generally ‘anything’ as those flogging the idea, either from outside or with the help of internal IT champions typically ignore the unspoken part of the question ‘...for me, our company, against the competition, etc’.

It is an issue of putting the innovation into specific context.

In October 1993 the then Anderson Consulting created a dramatic way of doing this for their retail prospects in Europe, through a ‘blue sky thinking’ experience called ‘Smart Store’, built at its office in Windsor, which aimed to transport senior retail executives into the distant future of 2010. The multi-room showcased the impact of technology in a context that would grab and sometimes shock retail executives into action. Many of the concepts, such as self scanning, logistics tagging and tracking, are now pretty much the norm, so it must have been a successful, if rather expensive investment.

While Smart Store showcased other company’s technology innovation to help Anderson Consulting sell services, other centres of innovation and executive briefing centres have been built by technology companies keen to show off their thought leadership. Both IBM and Sun Microsystems developed these sorts of facilities and have tried as hard as possible to justify the generally hidden back end ‘big tin’ with applications and services set in the context of real business.

Although the theatrics rarely meet the impressive standards of Anderson Consulting, some effort still goes into filling the demonstrations with props. It might seem trivial, but there is merit in demonstrating real world examples and doing some sort of scene setting. After all, how many business leaders or managers seeking solutions to specific business problems want to be faced simply by banks of (expensive) IBM and Sun servers?

From a recent visit to Motorola’s innovation centre in Basingstoke it is clear that money had not been frittered away on superfluous theatrics. The markets being targeted and applications shown address down-to-earth everyday business needs, not blue sky concepts. The main room is filled with many diverse communications devices from simple two way radios to smart consoles for forklift trucks; all great examples of Motorola’s innovation and technical prowess, but how do they connect to business?

Rather than looking for props or theatrics, the clues come from Motorola’s recent changes in corporate structure, in particular the decision to spin off the phones division earlier in 2010 and the acquisition of Symbol in 2006.

As the spinoff of the consumer oriented mobile phone part of the company concludes in 2011, what remains is business and public sector organisation focused, covering wireless LAN, drop in cellular networks and mobile devices. Rather than having the generic devices that might be picked up as consumer friendly phones by the average office worker, the new Motorola has large ranges of more specialised devices, some offering voice communications, some mobile data, others converging both. Why? It allows Motorola to provide different devices to target the specific working needs of different groups of workers, with tools that are sometimes rugged, often just robust, but always designed and dedicated to do a particular job—hence the reason there are so many in the innovation centre.

That is all well and good and, to be honest, what you might expect from a large technically driven company with over seventy years of innovation, but while the hiving off is bringing much needed focus, it is the acquisition and subsequent slow absorption of Symbol that turns that focus into revenue. Symbol not only brought smart small IT devices to the radio company, it also introduced an ecosystem of applications, application developers and channel partners.

This has become the driver for much activity and is where the business innovation is happening; developing a mobile application to meet the business process need of an individual worker, blending small robust hardware with the right interface options to fit their role and adding the spice of well engineered radio technology.

If Motorola can stay partner friendly and avoid the arrogance that so often surrounds long term industry players who think they can do it all themselves, this sounds like a recipe for success for all parties involved.

Mobile applications that address business needs rather than massage egos or satisfy gadget lovers will appeal to the business decision makers. That should put Motorola’s mobile innovation into context, and while its innovation centre is not overly theatrical in its presentation, this is not an issue for the practical business needs being addressed.

By: Julian Stuhler, Director, Triton Consulting Ltd Posted: 22nd September 2010 Copyright Triton Consulting Ltd © 2010

In recent years the move to outsource IT or business processes has really taken hold. There are definite benefits to outsourcing all or part of an organisation's database management systems. Access to specialised resources, which may not be available or are in short supply internally, is a major factor.

Rather than outsourcing their IT systems lock stock and barrel, organisations can look to supplement their internal resources with niche technical skills for interim staffing, ad-hoc consultancy or even just as an "insurance policy" back-up. Specialist service providers bring insight into how other companies are solving their business problems. These "war stories" from previous engagements can really help build a customer's knowledge of best practice. Rather than outsourcing to a good "all-rounder", organisations should look to specialist providers for the in-depth technical knowledge required to support mission critical systems.

Lack of skills
An actual lack of skills may well not be the issue. Unless they are moving to a new technology of which the organisation has little experience most organisations will have a good level of skills internally. However, availability of those skills can be an issue. Increasing workloads can often mean that individuals are tasked with ever growing and diverse responsibilities. If this sounds like a familiar scenario in your organisation then you're not alone. In a survey of DBAs by IDUG & CA the most significant database activity undertaken in 07–08 was upgrading the current database — at 67%. Daily maintenance was 56%. Particularly in smaller organisations (1–1000 employees); just 31 % said they were primarily involved in database administration. This means that DBAs are being pulled away from day-to-day maintenance into different projects.

Something has to give. Farming out all or part of the day to day tasks can be a useful way to free up time for a highly skilled team to be more usefully deployed and is almost certainly more cost effective than bringing in an extra team member to take on those tasks.

If the team is lacking skills then most outsourcing service providers can also offer mentoring, knowledge transfer and training solutions as well.

Cover
This one really depends on the size of the existing DBA team. Organisations with really large teams are unlikely to experience real issues with having the right amount of cover out of hours or during peak holiday seasons.

However, for those running smaller teams this can be a real problem. Some organisations are simply coping with what they have and are lucky enough not to have experienced any major issues — yet. It is a fact of life that people take holiday, get sick and have time off to look after children. For smaller teams, managing this can be a minefield. If there is a break in cover IT bosses have to be prepared for the consequences of a major database failure during that time — it could happen and the buck has to stop somewhere.

It is possible for organisations to enhance their existing teams with an out-of-hours only service that kicks in when the team clock off or an ad-hoc service which can be called upon when the team is stretched.

Service providers have SLAs to meet and they don't take annual leave or get sick!

What to look for in a provider

• Cost: Make sure that the service is cost effective for the business needs. How much does the service cost vs the cost of internal DBAs? It is impossible to predict how many hours or calls will be needed so check whether there is a limit to the number of service calls/number of hours available on the contract. What seemed like a good deal initially can end up being more costly than first thought; extra calls or time have to be purchased.
• Skills: This has to be a major consideration. Many companies offer a managed service solution for IT systems. The key, though, is finding the organisation with the specialist knowledge of the particular database software in use to be sure that any issues can be quickly and professionally dealt with.
• Cover: Be sure to find a provider with flexible packages which give the support and cover required. Perhaps cover is only needed out of hours because the in-house DBA team can cope with the day to day management. Or perhaps the system needs the assurance of 24/7 support.
• Proactive vs Reactive: Not all service providers can give proactive support. Looking for a supplier who can provide proactive monitoring means that there is no need to worry about users experiencing issues before it has been flagged to the team.

Specialist service providers bring a new dimension to outsourcing, one that gives organisations the peace of mind that they are working with a provider who really understands and has the skills necessary for the job. Rather than outsourcing to a good "all-rounder", organisations should look to specialist providers for the in-depth technical knowledge required to support mission critical systems.

About Triton
Triton Consulting are Data Management specialists and IBM Premier Business Partners. Specialising in DB2 for both the mainframe and distributed systems, Triton provide a full range of services from consultancy through to education and remote support.

The Remote DBA service allows organisations to benefit from remote DB2 support to suit them - from out of hours only to 24/7 cover. With Consultancy on Demand, organisations can purchase 20, 50 or 100 hours of support which can be used for training, consultancy or to cover absences within the existing DBA team. For more information on Triton visit http://www.triton.co.uk/ManagedServices.php

By: Simon Holloway, Practice Leader - Process Management & RFID, Bloor Research Posted: 21st July 2010 Copyright Bloor Research © 2010

When looking for the right ERP solution, there are numerous candidate solutions to choose from. So how do you differentiate between them to select the right one for you? Well the starting point is to understand your business in terms of its business processes and rules that you use to operate. This might seem a strange statement, but in all my years of consultancy, it has always surprised me how little many organisations really have a good grasp of what makes them tick. In particular, you must understand which processes are key to differentiating yourself from your competition. Now before looking at the market, you need to allocate budget. ERP software is not cheap but, there again, the ROI can be enormous. Now you can look at the market.

Bloor Research has just finished a Market Review of the ERP market, where we looked at some 34 products. What stood out was that all the packages supported the main functionality of running a manufacturing business. So how did differentiation occur? Well the answer was it was down to verticalisation, i.e. support for fabrication, automotive, pharmaceutical, CPG, etc, and to that wonderful term “ease of use”. Phil Nicholls, Managing Director, eMerge Information Technology Ltd told me, “In the cut-throat, competitive and acquisition-laden world of Enterprise Resource Planning (ERP), there is one attribute that all system suppliers claim. A claim, which is in danger of being so misused that it becomes meaningless. That is User-Friendly”. One solution aimed at the SME market that stood out for me was Priority, which is marketed in the UK by eMerge-IT.

Who produces Priority? Priority is developed by Eshbel, an Israeli software company. The company was founded in 1986 and Priority was first released in 1988. The product is now in its 13th version and there are over 3000 installations around the world. The largest customer has some 1000 seats. It is built on a Microsoft .NET platform and uses Microsoft SQL Server as it DBMS engine (although Oracle is also available). Eshbel has some 80 employees. The product is marketed by a number of distributors across the world, the largest of whom is another Israeli company, Medatech Information Technology Ltd. Medatech have some 170 employees and 15 years experience. In 2001, Medatech set up a UK subsidiary, eMerge-IT, to provide marketing and support for Priority. Emerge-IT is based at Chandlers Ford in Hampshire and has some 20 employees.

In my view an ERP has to provide the following basic modules for a manufacturer:

• Financial management, which should cover not only the basic sales, purchasing and general ledgers but also provide support for Asset Accounting, Financial Consolidation and Financial Control. These need to be associated with financial warehouse capability.

• Customer management, which should cover the ability to set up sales accounts and territories supported by contact management associated with the ability to manage leads and opportunities as well as handle mail shots. There needs to be support for customers to be able to place orders through a web front-end without the involvement of any of the manufacturer’s personnel. In today’s flexible market, price management, with rules for discounting, is a very important piece of functionality. For certain industries rental and promotions management is also important.

• Sales management, which not only has to cover the process of handling all your sales order types, but should also cover estimates and quotes in a similar vein. With main company's sales forces being remote from their base for the majority of the time, there is a need to provide sales force automation capabilities. It is also key to have support for sales literature as well as marketing campaign support. From an analysis viewpoint, for many organisations, analysis by sales channel is important as is pricing analysis and optimization and of course profitability analysis.

• Supplier management, as for customer management, support here is crucial. If you are using 3rd parties to provide logistical support in terms of warehouses and transport then there is a need to be able to incorporate their data into your ERP to be able to get a complete picture. There is a need to support foreign trade as well, of course, for billing and invoicing.

• Production Planning is, of course, what MRP and ERP were designed for. So you should be looking for capacity requirements, materials requirements, sales and operational, shop floor as well as support for ADO. Even for SMEs, there is a need for support for multi-sites and often this is now involved across international borders. The two other services required are support for engineering change management and lean manufacturing. There needs to be a good BI capability to divvy up these plans and simulate changes. The package also needs to be able to handle your type of operations (discrete, process, service, MRO).

• Materials management, which covers all the processing associated with your bill of materials, as well as the movement of goods in to and out of the factory as well as its movement inside the factory complex.

• Operations management; for me this covers all the tasks that are under the control of the Operations Director. This will include quality management with support for customer feedback capture as well as incident reporting and escalation management. For workforce management there needs to be support for task allocation, resource scheduling as well as an interface to HR to obtain absence details.

• Human resource management has four basic strands to support. Firstly there is the support for bringing people into the company, what is often referred to as Onboarding. This becomes associated with the ability to not only create but also maintain employees’ records. The second strand is around career and succession planning including training. The third strand is about payroll expenses and includes attendance recording. The final strand is that there is a portal capability that allows employees to look at and manage certain details themselves; this is often referred to as employee's self service.

• Plant maintenance has often been considered a subsidiary business function in ERP, but in my mind, for a manufacturer, this is a crucial part of managing your assets on the shop floor. For those organisations that manufacture plant and service it, then this component needs to cover spare part inventory control and external location management along with job order control. Plant maintenance helps with lean implementations by allowing you to carry out preventative maintenance.

• Services (after-market) management is a set of business functionality that is becoming more and more important as manufacturers look to adding additional revenue sources to their portfolios. This has been important for certain manufacturing sectors for some time, such as white goods, automotive and aerospace. Sub functions required to be supported are warranty management as well as call management.

• Product lifecycle management is another module that has been seen in the past as a subsidiary one. However, in my view manufacturers only keep going if they are innovative and this means they keep refreshing their product portfolio. PLM is aimed at providing the user with software necessary to control the research and development process of product development.

• Laboratory information systems have become more and more important as manufacturing takes the quality message inherent in lean manufacturing to heart. The module provides support for managing the taking of samples and the testing of those samples.

• Business intelligence is about being in control. All ERP solutions provide a set of data warehouses that are associated with modules in their ERP solutions. However, in addition, manufacturers need to be relating data across these Chinese walls in the package as well take in external data. In today’s world we also have the need to do this in near real-time!

So what makes Priority an interesting ERP for SME manufacturers? Firstly, this is due to breadth of coverage that the package delivers. As can be seen from Figure 1, Priority covers all of the above mentioned functionality and except for PLM does this fully.

Figure 1: Assessment of Business Functionality support of Priority (Source: Bloor Research)

From a finance point of view, Priority provides support for all manufacturing operations with a financial impact to be automatically modelled with cost of goods sold transactions and journal entries. There is full compliance with UK and European tax rules and multi-company environments can be consolidated in a single set of head office company accounts.

Priority provides full support for all production planning, materials management and operations management activities in an agile, fast moving market place. This support works whether a company makes to stock, makes to order, makes to forecast or any other variation of manufacturing regime.

CRM support provides the ability in full from both within conventional sites but also remotely from any location that has access to a telephone line. The web-browser interface brings sales force information on all customer data and contact details. In addition the Marketgate interface provides a web site to allow customers and prospects to place orders and monitor their order progress.

From an HR viewpoint, Priority stores all personnel records and provides record keeping and HR development, career management and candidate selection capabilities. At present there is no support for Payroll although this is being released this year in version 14.

The second reason that SME’s should look at Priority is the ability to add vertical as well as horizontal special modules to the base. Emerge-IT provides, amongst others:

• The Textiles module is an industry-specific module to assist clothing manufacturers to manage their production, sales and inventory according to style, size and colour.
• The Hire module provides specific functionality for the equipment hire industry.
• The Instant Addressing Module makes use of Experian’s QAS system, an address management and identity verification solution. This module is aimed at those organisations who want to be able to generate customer details accurately every time by inputting only the post-code and building name/number. This results in highly accurate address information being automatically generated with the minimum of user input.

Finally you get all this capability at a very good price with localized support from a company that understands not only the technology involved but also the business of manufacturing.

By: Rob Bamforth, Principal Analyst, Quocirca Posted: 7th July 2010 Copyright Quocirca © 2010

The acceleration of smartphone adoption, increasing use of low cost laptop dongles and the appearance of Wi-Fi in all sorts of devices from smart badges and trackers to tablets and phones, means one thing for networks—lots more data to carry in the air. 

This is a significant issue because despite the advances in wireless network technology—there is no dark fibre in the sky—capacity is limited. With wireline, it is always possible to light existing or dig more fibre or cables into the ground (at a price), but wireless networks are ultimately constrained, and apparently demand, thus far, is not.

It may be that might change. Perhaps users will get bored or their appetite for buying new data-intensive mobile products will diminish? The evidence from recent launches of devices such as Apple’s iPad indicates this is unlikely to be the case.

Or perhaps over time, with increases in mobile network tariffs, demand will be controlled by price—no wireless net neutrality then—but this will still be like trying to keep a pressure cooker lid on with an elastic band. Network operators need to stretch their tariffs and rules from time to time to win over and accommodate new users, devices and applications, in spite of how much network resource they will subsequently consume.

This means there will continue to be pressure on precious spectrum and the rest of the network. Squeezing more data into a finite pipe means compromises, constrictions or caps. Users, however, will not put up with any degradation in the quality of the experience—especially if their work or business depends on it.

The challenges facing mobile cellular networks are complex. Not only with more devices and data consumption, but the usage patterns are becoming harder to predict. When there was only a single application—voice telephony—it was easier to predict how it would be used and the impact this would have on the network. Now a plethora of applications pass data with and without the knowledge of the user, as roaming ‘bill shock’ often demonstrates.

Even with voice, the reasons and opportunities to make calls has accelerated. Despite texting, email and messaging people make mobile phone calls for even the slightest of reasons (“Hello, I’m on the train”) and this is especially noticed when there are many subscribers close together, sharing a common experience—at transport hubs, events or sports venues. This has tested voice networks on many occasions, but subscribers are at least clear that a call is made or not, or has been dropped. With data and applications, the effect of such problems can become even more frustrating.

For business use this is a real issue; if workers or business processes are coming to depend on mobile data access, can organisations truly rely on networks to deliver the right quality of experience? Operators can no longer assume that coverage is enough. They have to measure and test network performance based on the experience of the user, and this means end-to-end response time, total application, to client (and back). On the basis of this they are then in a position to provide service assurance commitments and guarantees to their business customers.

Cellular network providers have the advantage (some say otherwise) of being regulated as they are licensed users of spectrum, but unlicensed spectrum is also becoming essential to the business with greater use of Wi-FI for in-building, cross-campus data networks, wireless homes and even public hotspots. Wi-Fi is also providing alternatives for phone calls though fixed/mobile convergence when combined with cellular or alone in a voice over wireless LAN form of telephony.

Whereas once Wi-Fi could have been considered a ‘best efforts’ form of connectivity, it is now becoming an assumed and critical element of LANs. No longer simply connecting an office worker’s laptop for synchronisation, but now also providing a platform for voice calls, asset tracking and essential front line connectivity for a whole variety of needs.

This too needs to be taken seriously, and that means that when deployed, Wi-Fi availability must be properly measured and assured to a sufficiently high level to meet the needs of the business. This is a step up for many IT departments and, combined with the need to gather assurances about mobile cellular data providers, means that those responsible for managing their organisation's mobile IT networks have to switch their thinking from meeting technical service levels to meeting user experience criteria.

These requirements may at times seem subjective, and some users are prone to complain even when it is not justified, so if there are problems with current suppliers, talking to vendors who are providing more tangible mobile network assurance solutions would seem to be a good idea.

By: Dana Gardner, Principal Analyst, Interarbor Solutions Posted: 30th June 2010 Copyright Interarbor Solutions © 2010

The moderator of our podcast this time is Tim Minahan, Chief Marketing Officer at Ariba.

Minahan: When discussing heady topics like the cloud, procurement, and finance, and looking at the future of business-to-business (B2B) commerce, we thought it important for you to hear from the experts. So we have assembled a panel of the leading analysts—the folks that you turn to to benchmark your performance, uncover best practices, and make IT buying decisions.

I'd like to welcome our panelists: Mickey North Rizza from AMR Research (a Gartner company), Chris Sawchuk from The Hackett Group, Robert Mahowald from IDC, and Bruce Guptill from Saugatuck Technology.

Here are some excerpts from the discussion:

Guptill: The first thing is to figure out how to handle this cloud thing. It's the single most disruptive influence that we've seen in not just IT, but in how IT is bought, used, paid for, and how that affects how everybody does business. So how is it accounted for? Who has responsibility for managing what aspects?

If you have some of it on-premise and some of it out in the cloud, who is responsible? How is it managed? How is that budgeted for? It changes the way we operate as a business, because it changes the way we spend, the way we buy, and the way we manage. It's very, very disruptive, and policies and practices really haven’t caught up yet to the reality, and we're not getting a breather. The change is accelerating.

Sawchuk: When we ask procurement executives what are they focused on going into 2010 from a technology standpoint, the number one area is just utilizing better the technology investments that they have made—digesting them. So, it's a lot of the basics—cleaning up our master data and just getting more utilization on our eProcurement, eSourcing types of tools in the organization.

But there are a couple of emerging trends that are occurring in the most progressive procurement organizations, in three areas. One is around collaborative technologies. Why is it so difficult to do this in business, when it's so easy with Facebook and all that type of stuff in the non-business type of world? It's not just externally that this applies, but internally as well.

The cloud offers a way to do that a lot more quickly, for less cost, in a way that is still as secure and authenticated as it would be in my IT shop.

Number two, around better management of the knowledge and intelligence across the organization, structured, unstructured, internal, and external types of information.

And lastly, driving more agility into the procurement service delivery model, which includes the technology tools.

Mahowald: For the last 10 years or so, we have seen lines of business start to get more acclimated using software-as-a-service (SaaS) services. Some of those lessons are how those services are delivered and filtered back to IT.

Virtualization, automation, and standardization are finding their ways into our IT departments and they're finding ways to do things like reduce the number of physical assets they spend their time counting, and keep them up and running, and rely more and more on external services that can safely provide the functionality that their users require.

And the typical scenario is that, if I am in the line of business and I want to build an application, or I need to have access to an IT service, I've got to go to my IT team. It can often be long and time-consuming to get that thing spun up and tested, kick all the tires, and get it up and running in the environment that is being used.

The cloud offers a way to do that a lot more quickly, for less cost, in a way that is still as secure and authenticated as it would be in my IT shop, and probably done in a way that is much, much more service enabled, for the ultimate constituency I want to serve, my user, the internal user. So, it's a big opportunity.

North Rizza: Basically, what we're seeing is that companies have a lot of pent up demand over the last couple of years. They haven't been able to change some of their business processes and automate them the way they would like to. What they've been doing is standing back, trying to get more out of their ERP systems or basic business processes. They've had to make a lot of cuts and they're not getting everything they need. What we're finding now is that spending is starting to pick up.

We're also finding that companies are looking for alternative deployment models. They're starting to say, "What can I do above and beyond just the technology application? Where else can I look for services and other opportunities that are, one, going to quickly drive value to my line of business buyer, because those are the folks that do the business day in and day out? They're the ones that need to make a difference. And finally, how do I do it quickly, without a lot of disruption, very flexible, and a great investment, but a really quick return on that investment?"

Sawchuk: When we asked CFOs in the broader enterprise, coming into 2010, what was the number one area of focus for them, it was cash. When we asked the same question to the procurement executives and community, it was cost. Cash was number 10. So the question is, are we misaligned or do we feel that we have done everything we can over the last 18–24 months and there’s nothing more to do?

When you look at this, procurement and the data as just being cost focused are fading. We've got to get much more balanced in the way we actually deliver our value, not just cost, but also working capital and other areas as well.

You wanted some examples of what these world-class organizations do around working capital and how they do it well. Number one, they measure it. They bring visibility to it. They put it on their scorecards. They have cash conversions, cycle time matrix, DPO, DIO, etc.

Number two, they manage it and the source-to-settle, purchase-to-pay process.

Number three, they create collaborative communities with procurement, with the business, finance, and treasury, around working capital strategies and objectives.

And, fourth, they actually compensate. We see organizations out there where some of the procurement folks and these folks on these collaborative communities are compensating. Up to one-third of their compensation is based on their achievement of working capital objectives.

Mahowald: In many IT organizations, as much as 55 percent of the budget is spent on keeping systems running, and that involves paying for the ongoing license and maintenance and support of software and hardware and all the power pipe cost that it takes to run an IT center.

The ability to reduce some of those costs by outsourcing them in lower-cost subscription models that are operating costs is an enormously helpful transition for many customers. CIOs that we talk to are excited about introducing cloud services and also what we call naked compute services or offsite storage to improve the efficiency of certain applications that are widely used in the organization or offsite development platforms, where they can actually build applications.

It’s a major activity for many IT organizations to build new applications, objects, and customizations on-site. If they can offshore that and not have to pay application licenses or infrastructure cost, that’s a big help to them in lowering their fixed-cost structure. Ultimately, it's a big help to make IT organizations much more lean and responsive to their needs.

Guptill: If you can take the software and put it in the cloud, and if you can take the hardware and the infrastructure service, the IT, and put it in the cloud and take advantage of that, we have all these vendors—let's take Ariba for an example—that have these terrific technologies, applications, and the expertise to use them. Why can’t that be delivered and used as a service, as a utility, cloud-based or otherwise?

Then, we have the business logic, we have the software, the applications, the functionality, and the technology, to make it happen. We can do that as an as-needed, on-demand, or subscription basis. It removes a lot of the fixed cost that we've been talking about. It reduces our reliance on fixed assets or fixed cost for what could be cyclical or temporary needs in terms of functionality. It's basically outsourcing business tasks, business functions, or business processes to the cloud. It's "cloud temping" basically.

Over time, these things start from very simple, straightforward, and standardized capabilities, similar to what SaaS, or infrastructure as a service (IaaS) started as, but we are seeing them start to evolve into more configurable or more customizable capabilities.

So that we can now—it's just starting now, but will be much more over the course of the next four or five years—take advantage of a large pool of business functionality that we don’t want to buy. It's not just a technology. It's not just a software. But it's the business tasks that we don’t want to buy, we don’t want to train, and we don’t want on our books. We can rent those as we need them, and when the work is done, they retire back to the cloud.

North Rizza: We found that 96 percent of those in our studies are using cloud-based solutions, but out of that 96 percent, 46 percent are geared into a hybrid cloud solution. And by hybrid we mean that they're actually using cloud technology applications. They're optimizing those against their IT on-premise investments, and further, they're extending the capabilities into cloud services technology. So they're looking at the whole gamut.

When it's executed well and done well, it allows you to execute on your working capital and supplier payment types of strategies.

The second part of that is the next leading area, and that’s 41 percent around a private cloud. The difference there is that they're looking at technology capabilities from the cloud and they're putting that with their ERP or on-premise IT investments, but they're not necessarily extending those capabilities.

... We found that those that actually deployed cloud solutions, technologies, and services and put them out there, found anywhere from 5–7 percent difference in greater value, just by deploying, versus those that are thinking about it or trying to get into the mode of, "We want to go down that path and we are thinking about that investment process."

What were the benefits? It's really interesting. The first is that they were able to drive more revenue. Understandably, if we get those cloud-based solutions, we're going to drive more revenue. If you think about that gap from 5–9 percent, that’s huge, on a revenue standpoint.

Two other points: the cost-to-serve model. They're able to look at what their costs are, what are costing to serve from the enterprise, all the way through their trading partners, all the way back out into where the demand cycle begins, from a supply chain perspective. They get more savings, and those two go hand in hand. Then lastly, it's around that business cycle time improvement aspect.

... So, while we see this as a big area, and companies keep going down this path, one of the things we also find is that it really means a sharper focus on master data management (MDM), your business processes, how that’s orchestrated, both inside the enterprise and externally into your trading partners, and understanding your governance structure. We'll see more and more of that come out, as time goes on here.

Sawchuk: We've been talking about the cloud. How does it help? First of all, and you've heard a lot about this, cloud gives you much faster, easier, and more economical access to technology solutions. Now that you're connected, you can speed the transactions across your supply base, etc.

More importantly, it gives you much more predictability in your ability to execute. For example, a lot of us say we moved our terms. We moved our terms from 45 to 60 days. When we do that, the suppliers say, "When we were on 45, you couldn't pay me on time. You moved it to 60. Can you pay me now on time?" It gives you some predictability in the execution. That's important to them.

Number two is, if you negotiate early pay discounts, you have the ability to execute and take advantage of those kinds of things that you have in your commercial agreement.

The cloud also does a couple of things. It certainly brings much more visibility to the overall activities that are occurring across the entire source-to-settle process. But also, once you are connected in this whole cloud environment, it certainly gives you access to intelligent services that exist out there. I'm talking about working capital, things like information about the financial health of your suppliers, their historical performance, the cost of capital, etc.

That kind of collision between outside the cloud and inside the organization is going to change and it could change business pretty dramatically.

Mahowald: We talked about lower cost, leaner IT organizations, because they are able to source outside of the organization, and get lower cost services. We think that kind of collision between outside the cloud and inside the organization is going to change and it could change business pretty dramatically.

Another thing is that, when you've got solutions that are brought in by business users -- maybe it's a salesforce.com or some other SaaS application -- it's important to them, and it's important for them, to get agility and speed to that functionality, but there are going to be many places where you are going to be brought outside of your organization, because that's where business happens.

Whether it's in a commerce cloud or another forum or marketplace for the exchange of products, you will be forced there essentially to do business, to maintain your presence in the game, see that transparency, and have it help your business. We think that's probably the most likely place for that collision to occur.

Guptill: We've researched, interviewed, and surveyed a little over 7,000 executives worldwide -- finance, procurement, HR, IT, line of business -- over the last six or seven years about what it is that they want to do with cloud IT, whether it's SaaS or IaaS, platform as a service (PaaS) or whatever. In every single case so far, they're using it to add to what they have. It's filling in the gaps. It's enabling better efficiencies, better cost. It's delivering benefits that they could not get earlier cost effectively.

When you think about it, that’s the pattern of IT investment over the last 50- 60 years. It's very, very rare that we replace what we have with whatever new is coming in. There's all this hype about new stuff is coming and it's going to change everything. It's going to get rid of this. We are going to dump that.

Within four to five years, by year end 2015, more than 50 percent of new IT spending will be in the cloud for the first time.

Our latest survey research, which we are just in the process of publishing right now, very strongly indicates that within four to five years, by year end 2015, more than 50 percent of new IT spending will be in the cloud for the first time. That’s within four or five years. But, that means that about 50 percent, or a little less than half, is still going to be on-premise, so that stuff is not going away.

So, over time, what's going to happen is that we have a series of decisions to make. What costs are we trying to control? How are we going to change our purchasing, procurement, management, payment, relationship management, and so on?

Then, as our traditional on-premise systems, not all of them, but as each one comes up, as they reach the end of their useful life, what do we do? Because traditionally, we would add to them, we would just build out around them, until they take over the entire data center, or we would outsource. Now, we have a combination. We can put some in the cloud and some on-premise.

Those are the decisions that we're going to have to face, as we go ahead. What goes out there? What stays in here? What goes in between? The stuff has to be made to work together. Who has that responsibility? What's it going to cost? How is that going to be budgeted? And how are we going to manage all this?

Listen to the podcast. Find it on iTunes/iPod. Read a full transcript or download a copy.

By: Dana Gardner, Principal Analyst, Interarbor Solutions Posted: 21st June 2010 Copyright Interarbor Solutions © 2010

We present a customer case study focussing on Motorola in the area of productivity, cost optimization, and their IT efficiency efforts—a winner of HP's Excellence Award this year.

We're going to hear more about that from Judy Murrah, Senior Director of IT, at Motorola. The discussion is moderated by Dana Gardner, Principal Analyst at Interarbor Solutions.

Here are some excerpts:

Murrah: We sat down with our business partners, top leadership on both sides—our CIO and the business presidents and executive teams—and talked through every business function. That’s the place where we started and where we saw the magic unfold.

We looked at it on a scale of business competitiveness and how important that particular business function is to the business. Then, on the other axis, if you picture the famous 2×2 matrix, we looked at the complexity and cost of that business function.

We did that for every business function we have. We laid it out and then talked through where we would like those functions to move in the future. By mapping it out visually, it helped us to know that some areas were just costing more money than the value they brought to the business. When you see that, you put data on a piece of paper, and you have a visual, it is a very good way to align business and IT around a common goal.

... You don’t really think too much about change and cost optimization being related, but we have had, over time, a very complex IT environment grow. We have thousands of systems in a company that has grown organically and through mergers, acquisitions, and divestitures.

Just to give you an example, if we talk about engineering as a business function; to Motorola, which is a technology company, that’s a critical competitive differentiator, very important, high on the scale of competitiveness. If we look at the complexity and cost of running that today, in Motorola, we have a lot of systems and it’s a high-cost area.

We have somewhere in the neighborhood of 1,800 systems in the company. We manage about 1,000 projects per year that flow out of these decisions. We have about 1,500 employees in the IT organization and are very heavily outsourced in some of the functions. So, we have another few thousand folks who we consider a part of the team, and that’s who have all made this happen.

In order to really be part of the business imperatives to move forward in next-generation business processes, it was too complex to make changes. So, we focused on reducing those systems and doing it in a way that was directly aligned to business change and the directions they would like to go into.

My role at Motorola IT is in what we call CIO Operations. I'm responsible for our project management office (PMO) portfolio, quality, communications, and other activities that support our IT operations. Cost optimization is on everybody’s mind these days, especially with the economy the way it is, and with many business initiatives out there.

The only way we could have managed this is our implementation of one tool and one process, that’s used across the whole Motorola IT environment—HP’s Project and Portfolio Management Center (PPM). It gives us one place where we contain our "source of truth" for our investment dollars, for the priorities of the business request coming through, and for the things that we've decided to work on.

In that tool, we have every one of our people resources named, as well as what they're working on, and we look at their utilization and movement to the most critical areas. We also manage our project execution to the timelines, schedules, and budgets that we commit to our business partners.

What’s very important then is that all of this underlying data and management process that we use can be presented back to the business in very good dashboards and reporting, so that we all stay on top of where we are and can be proactive on change, if it’s needed.

About a year ago we moved from a hosted environment, internal to Motorola, to the HP software-as-a-service (SaaS) environment. It works like a charm. No issues with performance. We have had great responsiveness from HP. It does help reduce our support cost, somewhere around 40 to 50 percent.

Moving from hosted to SaaS didn’t affect usability, adoption, or anything. That really was almost seamless. We were using the same application before and after.

I always talk about how IT is sometimes like the cobbler’s children, as the old saying goes. It’s very difficult to justify the investment in IT tools at some points in time, unless you have ones like this, that are showing payback to the business and you use them in a way that everyone is now depending on it. It does become the enterprise resource planning (ERP) system of the IT organization.

In the last two years we have reduced our cost structure by about 40 percent. That is a big number to do while the business is operating. We have also, on our large projects that we run through the system, shown about a 150 percent payback or return on investment (ROI) for those. That means that the value of the investment for us was placed in the right places.

We've been able to reduce IT support costs by about 25 percent. Previous to this more consolidated system, we were operating in such silos that there were many people doing the same things. So by consolidating, we eliminated about 25 percent of the wasted work.

I think a couple of areas that we need to work at going forward are more on our application support area. That's bringing the tool to manage resources and activities and support operations, tying it a little more tightly into our financial management, and getting a little more granular on the skills and our ability to move our resources around from place to place.

Listen to the podcast. Find it on iTunes/iPod. Read a full transcript or download a copy.

By: Dana Gardner, Principal Analyst, Interarbor Solutions Posted: 17th June 2010 Copyright Interarbor Solutions © 2010

If cloud, in its many forms, gains traction—like any other big change affecting business and IT—adopters require a lot of rationales, incentives, and measurable returns to keep progressing successfully. But, just as the definition of cloud computing itself can elicit myriad responses, the same is true for why an organization should encourage cloud computing.

The major paybacks are not clearly agreed upon, for sure. Are the paybacks purely in economic terms? Is cloud a route to IT efficiency primarily? Are the business agility benefits paramount? Or, does cloud transform business and markets in ways not yet fully understood?

We seek a list of the top reasons why exploiting cloud computing models make sense, and why at least experimenting with cloud should be done sooner rather than later. We have assembled a panel of cloud experts to put some serious wood behind the arrow leading to the cloud.

Please join me now in welcoming Archie Reed, HP's Chief Technologist for Cloud Security and the author of several publications including The Definitive Guide to Identity Management and a new book, The Concise Guide to Cloud Computing; Jim Reavis, executive director of the Cloud Security Alliance (CSA) and president of Reavis Consulting Group, and Dave Linthicum, Chief Technology Officer of Bick Group and also a prolific cloud blogger and author. The discussion is moderated by Dana Gardner, principal analyst at Interarbor Solutions.

Here are some excerpts:

Reed: When we go into all of this discussion around what is the benefit [to cloud], we need to do our standard risk analysis. There’s nothing too much that's new here, but what we do see is that when you get to the cloud and you're doing that assessment, the [payoffs] come down to agility.

Agility, in this sense, has the dimensions of speed and scale. For businesses, that can be quite compelling in terms of economic return and business agility, which is another variation on the theme. But we gain this through the attributes we ascribe to cloud—things like instant on/off, huge scale, per-use billing, all the things we tried to achieve previously but finally seem to be able to get with a cloud-computing architectural model.

If we're going to do the cost-benefit analysis, it does come down to the fact that, through that per-use billing, we're able to do this in a much more fine-grain manner and then compare to the risks that we are going to encounter as a result of using this type of environment. Again, that's regardless of whether it’s public or private. The risks may go down, if it’s a private environment.

Factoring all those things in together, there's not too much of a new model in how we try to achieve this justification and gain those benefits.

Linthicum: This notion of business agility is really where the money is. It's the ability to scale up and scale down, the ability to allocate compute resources around business opportunities, and the ability to align the business to new markets quickly and efficiently, without doing waves and waves of software acquisitions, setups, installs, and all the risks around doing that. That's really where the core benefit is.

If you look at that and you look at the strategic value of agility within your enterprise, it’s always different. In other words, your value of agility is going to vary greatly between a high tech company, a finance company, and a manufacturing company. You can come up with the business benefit and the reason for moving into cloud computing, and people have a tendency not to think that way.

But you have to weigh that benefit in line with the innate risks in moving to these platforms. Whether or not you are moving from on-premises to off-premises, on-premies to cloud, or traditional on-premises to private cloud computing, there’s always risk involved in terms of how you do security, governance, latency, and those things.

Once you factor those things in and you understand what the value drivers are in both OPEX and CAPEX cost and the trade-offs there, as well as business agility, and weigh in the risk, then you have your cost-benefit analysis equation, and it comes down to a business decision. Nine times out of ten, the cloud computing provider is going to provide a more strategic IT value than traditional computing platforms.

Reavis: When you think about the economics, what’s the core of economics? It's supply and demand. Cloud gives you that ability to more efficiently serve your customers. It becomes a customer-service issue, where you can provide a supply of whatever your service is that really fits with their demand.

Ten years ago I started a little minor success in the Internet dot-com days. It was called Securityportal.com. You all remember something called the "Slashdot effect," where a story would get posted on Slashdot and it would basically take your business out. You would have an outage, because so much traffic would go your way.

We would, on the one hand, love those sorts of things, and we would live in fear of when that would happen, when we would get recognition, because we didn’t have cloud-based models for servicing our customers. So, when good things would happen, it would sometimes be a bad thing for us.

I had a chance to spend a lot of time with an online gaming company, and the way they've been able to scale up would only be possible in the cloud. Their business would not have been able to exist in the earlier era of the Internet. It’s just not possible.

So, yeah, it provides us this whole new platform. I've maintained all along that we're not just going to migrate IT into the cloud, but we're going to reinvent new businesses, new business processes, and new ways of having an intermediary relationship with other suppliers and our customers as well. So it’s going to be very, very transformational.

Reed: At HP, when we talk to customers and even try to evaluate internally, we talk about this thing called business outcomes being core to how IT and business align. Whether they're small companies or large companies, it's providing services that support the business outcomes and understanding that ultimately you want to deliver.

In business terms, it's more processing of loan requests and financial transactions. Then, if that’s the measure that people are looking at what the business outcomes need to be, then IT can align with that and they become the service provider for that capability.

We've talked to a lot of customers, particularly in the financial industry, for example, where IT wasn’t measured in how they cut costs or how much staff they had. They were measured in incremental improvements on how many advances could be made in delivering more business capability.

In that example, one particular business metric was, "We can process more loans in a day, when necessary." The way they achieved that was by re-architecting things in a more cloud or service-centric way, wherein they could essentially ramp up, on what they called a private cloud, the ability to process things much more quickly.

Now, many in IT realize—perhaps not enough, but we're seeing the change—that they need to make this toward the service oriented architecture (SOA) approach and delivery, such that they are becoming experts in brokering the right solution to deliver the most significant business outcomes.

That becomes the latency that drives the lateness of the business process changes that need to occur within the enterprise.

The source of those services is less about how much hardware and software you need to buy and integrate and all that sort of thing, and more about the most economical and secure way that they can deliver the majority of desired outcomes. You don’t just want to build one service to provide a capability. You want to build an environment and an architecture that achieves the bulk of the desired outcomes.

Linthicum: Cloud computing will provide us with some additional capabilities. It's not necessarily nirvana, but you can get at compute and you can get at even some of these pretty big services. For example, the Predictive API that Google just announced at Google I/O recently is an amazing piece of data-mining stuff that you can get for free, for now.

The ability to tie that into your existing processes and perhaps make some predictions in terms of inventory control things, means you could save potentially a million dollars a month, supporting just-in-time inventory processes within your enterprise. Those sorts of things really need to come into the mix in order to provide the additional value.

Sometimes we can drive processes out of the cloud, but I think processes are really going to be driven on-premises and they are going to include cloud resources. The ability to on-board those cloud resources is needed to support the changes in the processes and is really going to be the value of cloud computing.

That the area that’s probably the most exciting thing. I just came back from Gluecon in Denver. That is, in a sense, a cloud developers’ conference, and they're all talking about application programming interfaces (APIs) and building the next infrastructure.

When those things come online, become available, and we don’t have to build those things in-house, we can actually leverage them into a "pay per drink" basis through some kind of provider, buying those into our processes. We'll perhaps have thousands of APIs that exist all over the place, and perhaps even not even local data within these APIs.

That’s where the value of cloud computing is going to appear, and we haven’t seen anything yet. There are huge amounts of value being built right now.

They just produce behavior, and we bring them together to form these core business processes. More importantly, we bring them together to recreate these core business processes around new needs of the business.

Reed: I think the incentives, the risks, and all those things with cloud computing change, dependent on the type of business we're looking at.

Certainly, when we talk to smaller organizations and mid-sized organizations as well, they're looking for the edge that they can gain in terms of cost and support and, in most cases, more security. In this case, they look for broader back-office solutions than perhaps some of the larger organizations, things such as email, account management, HR, and so forth, as well as front-end stuff, basic web hosting and more advanced versions of that.

We've implemented things like Microsoft Business Productivity Online Suite (BPOS) for many customers, especially in the mid range. They do find better support, better up time, better cost controls, and to Jim’s point, more security than they are able to provide for themselves.

When we get to talk to larger organizations, some are looking for this. We know, even in the financial industry, which you might consider to be one of the most security paranoid type environments there are outside of the three-letter agencies, they find that kind of thing appealing as well. Some of those have actually gone to use Salesforce.com for some of their services.

But, they're generally more concerned with the security stuff and they often find specific capabilities more appealing in a service model, such as data processing, data analysis, data retrieval, functional analysis, and things like that. The mashups are definitely more popular as a type of model or the service-oriented nature is more popular model with larger organizations that we talk to.

Linthicum: Moving into cloud is going to make people think in a very healthy, paranoid state. In other words, they are going to think twice about what information goes out there, how that information is secured and modeled, what APIs they are leveraging, and service level agreements (SLAs). They're going to consider encryption and identity management systems that they haven’t done in the past.

In most of the instances that I am seeing deploying cloud computing systems, they are as secure, if not more secure, than the existing on-premise systems. I would trust those cloud computing systems more than I would the existing on-premise systems.

That comes with some work, some discipline, some governance, some security, and a lot of things that we just haven’t thought about a lot, or haven’t thought about enough with the traditional on-premise systems. So, that’s going to be a side benefit. In two years, we're going to have better security and better understanding of security because of cloud.

Reed: There will be businesses that are willing and able and can manage cloud-type environments to their benefit. But, eventually, the gaps become so small and the availability of these services online becomes so ubiquitous that I'm not sure how long this window goes for.

I don’t want to say that, in a few years, everybody will be able to deliver the same thing just as quickly. But for the moment, I think there’s a few forward thinking organizations that will be able to achieve that to great success.

Reavis: The organizations that are developing what they think is state-of-the-art—but it’s not cloud—are going to be struggling, because all of the neat, interesting new developments. It’s hard to even put your head around all of implications of compute-as-a-utility and all the innovation we are going to see, but we know it’s going to be on that platform.

If you think of this as the new development platform, then yeah, it’s going to be a real competitive issue. There are going to be a lot of new capabilities that will only be accessible in this platform, and they're going to come a lot quicker.

So, in terms of the first movers and the environment now, it’s going to look very different. Anybody who carved out some space right now and some lead in the market in cloud shouldn't feel too comfortable about their position, because there are companies we don't even know about at this point, that are going to be fairly pervasive and have a lot to say about IT five years from now.

Listen to the podcast. Find it on iTunes/iPod. Read a full transcript or download a copy.

By: Dana Gardner, Principal Analyst, Interarbor Solutions Posted: 1st June 2010 Copyright Interarbor Solutions © 2010

Apptio is betting big on the market for demand-based budget forecasting. A new feature in its technology business management solutions software suite aims to help business managers plan and budget more accurately by inputting departmental forecasts into its software.

The Bellevue, Wash., company is calling it a “closed-loop” approach to financial planning, cost management, and transparency. The promised result: tighter alignment with business priorities, improved cost efficiency, and transparent reporting on the cost and value of IT services.

Michel Feaster, vice president of products at Apptio, is convinced the company’s closed-loop financial planning process will “close the gap between IT and the business” by letting companies update budgets and forecasts based on real business priorities.

“Demand-based forecasting gives IT the data it needs to respond more effectively, and plan accordingly with minimal variance so they aren’t over- or under-committing resources,” Feaster said.

Budgeting and planning = painful and inaccurate
Indeed, Apptio’s latest feature intends to remedy a notoriously painful and inaccurate IT budgeting and planning process. It was General Electric CEO Jack Welch who once said, “The budgeting process at most companies has to be the most ineffective practice in management. It sucks the energy, time, fun, and big dreams out of an organization. It hides opportunity and stunts growth.”

The budgeting process . . . hides opportunity and stunts growth
Apptio’s demand-based forecasting works on the premise that past performance is not an indicator of future trends. Many variables can change and those changes can make a ripple effect across the organization’s IT services needs. In essence, Apptio’s demand-based forecasting is applying best practices from the supply chain management world to IT budgeting and planning.

Companies like Starbucks, Cisco, and Volkswagen are reporting savings with Apptio solutions to determine how changes in key business drivers affect IT services. In fact, Starbucks has seen $1.4 million in savings in nine months while Volkswagen reports a 50 percent reduction in annual budgeting costs through Apptio’s automation. Apptio believes the new demand-based forecasting will drive even stronger returns.

BriefingsDirect contributor Jennifer LeClaire provided editorial assistance and research on this post. She can be reached at http://www.linkedin.com/in/jleclaire and http://www.jenniferleclaire.com.

By: Dana Gardner, Principal Analyst, Interarbor Solutions Posted: 25th May 2010 Copyright Interarbor Solutions © 2010

Our latest BriefingsDirect interview is with an executive from HP to look at proper planning and execution for massive application-consolidation projects, specifically by examining an HP project itself.

By unpacking this multi-year application consolidation project across global supply chains, we learn about best practices and execution accelerators for such projects, which often involve hundreds of applications and impact thousands of people.

These are by no means trivial projects, and often involve every aspect of IT, as well as require a backing of the business leadership and the users to be done well. The goal through these complex undertakings is to radically improve how applications are developed, managed, and governed across their lifecycle to better support dynamic business environments. The stakes, therefore, are potentially huge for both IT and the business.

The telling case-study, the Global Part Supply Chain project at HP, was initially undertaken in 2006 but typically became bogged down by sheer scale and complexity. After some changes in management approach and governance, however, the project quickly became hugely successful.

We learn how and why from Paul Evans, Worldwide Marketing Lead on Applications Transformation at HP. The interview is conducted by BriefingsDirect's Dana Gardner, principal analyst at Interarbor Solutions.

Here are some excerpts:

Evans: We have always said that the experiences we gain from our own work we would share openly, and sometimes we’re quite happy to say where we did go wrong. In this instance, we’ve written up a case study to give people an insight in more detail than I could possibly provide today. We're going to post that on our portal. If people want to go there, it’s relatively simple: HP's Application Consolidation case study.

There are so many lessons learned here, addressing what people have in terms of portfolio and then also delivering new, contemporary, revised types of applications and/or infrastructure. They’ll find videos and other materials of other customers who have embarked on these journeys, whether they’ve been driving that from the top down, from an application’s nature, or whether it’s people who are coming in from the infrastructure.

As you can imagine, HP is an extremely large organization. It makes products, as well as sells services, etc. In terms of product, just imagine your average PC, or your average server, and think of the number of components that are made up inside of that device. It runs into hundreds of thousands, whether it's memory chips, disk drives, screens, keyboards, or whatever.

For a company like HP, in the event that someone needs a spare part for whatever reason, they don't expect to wait a significant period of time for it to turn up. They want it delivered 24 hours later by whatever means that suits them.

So, it's essential for us to have that global supply chain of spare parts tailored toward the ones that we believe we need more—rather than less—and that we can supply those parts quickly and easily and, at the same time, cost effectively. That's important for any organization that is dealing in physical components or in the provision of a service. You want to maintain customer satisfaction or increased customer satisfaction.

Customer centric
For us, it was essential that a massive global supply chain organization was extremely customer-centric, but at the same time, very cost-effective. We were doing our utmost to reduce costs, increase the agility of the applications to service the customers, and fuel growth, as our organization and our business grows. The organization has got to respond to that.

So the primary reasoning here was that this is a large organization, dealing with multiple components with pressures on it both from the business and the IT sides.

One of the primary reasons we had to do this is that HP has been an amalgam of companies like Hewlett-Packard, originally, Compaq, Tandem, DEC. All of these organizations had their own bills of materials, their own skills, and basically this thing has just grown like Topsy.

What we were trying to do here was to say that we just couldn't continue to treat these systems as un-integrated. We had a lot of legacy environments that were expensive to run, a lot of redundancy, and a lot of overlap.

The goal here clearly was to produce one integrated solution that treated the HP customer as an individual, and in the back-end consolidated the applications—the ones we really needed to move forward. And also, a goal was to retire those applications that were no longer necessary to support the business processes.

The whole notion of this coming about through mergers and acquisitions is very common in the marketplace. It's not unique just to HP. The question of whether you just live with everybody’s apps or you begin to consolidate and rationalize is a major question that customers are asking themselves.

From the IT side, there was clearly a view from the top down that said living with 300 applications in the supply-chain world was unacceptable. But also from the business side, the real push was that we had to improve certain metrics. We have this metric called Spend-to-Revenue ratio which is, in fact, what are we spending for parts as opposed to what we are getting in terms of revenue? We were clearly below par in those spaces.

We had some business imperatives that were driving this project that said we needed to save money, we needed to be able to deliver faster, and we needed to be able to do it more reliably. If we tell a customer they're going to get the part within 24 hours, we deliver in 24 hours—not 36 or 48, because we weren't quite sure where it was. We had to maintain the business acumen.

The rationalization that has taken place inside HP around its IT organization and technology is that because we are human beings, most people think in a very siloed way.

They see their suite of applications supporting their business. They like them. They love them. They’ve grown up with them, and they want to continue using them. Their view is, "Mine is perfect to suit my business requirement. Why would I need anything else?"

That's okay, when you're very close to the coalface. You can always make decisions and always deem to the fact that the applications you use are strategic—an interesting word that a lot of people use. But, as you zoom out from that environment and begin to get a more holistic view of the silos, you can begin to see that the duplication and replication is grossly inefficient and grossly expensive.

So, our whole goal here was to align business and IT in terms of a technological response to a business driver.

When we submitted the project, we were basically driving it by committee. Individual business units were saying, "I need applications x, y, z." Another group says, "Actually, we need a, b, c." There was virtually no ability to get to any consensus. The goal here is to go from 300 apps to 30 apps. We’re never going to do it, if you could all self-justify the applications you need.

What we did was discard the committee approach. We took the approach, basically led by one person from the business side, who had supply chain experience, and one from the IT side who had supply chain experience, but both had their specialist areas. These two people were the drivers. The buck stopped with these people. They had to make the big decisions.

To support them, they had a sponsorship committee of senior executives, to which they could always escalate, if there was a problem making a final decision about what was necessary.

Randy Mott, the HP CIO, has the direct support of Mark Hurd, the HP chairman and CEO. In my experience, that's absolutely essential in any project a customer undertakes. They have to have executive sponsorship from the top.

If you don't, any time you get to an impasse, there's no way out. It just distills into argument and bickering. You need somebody who's going to make the decision and says, "We're going this way and we're not going that way."

Getting on track
So for us, setting up this whole governance team of two people to make the hard decisions, and their being supported by a project management team who are there to go off and enact the decisions that were made was the way we really began to move this project forward, get it on track, get it on time, and get it in on budget.

When we started by saying let's have a big committee to help my decisions, it was the wrong approach. We were going nowhere. We had to rationalize and say "no."

Two respected individuals, one from the IT side and one from the business side, who were totally aligned on what they were doing, shared the same vision in what they were trying to achieve. By virtue of that, we could enforce throughout decisions, which were sometimes unpopular.

We had to focus on driving this both from business and IT. As I said in this example, we went from 300 apps to 30 apps. We had a 39 percent reduction in our inventory dollars. We reduced our supply chain expenses. We reduced the cost of doing next day delivery. We're heading toward reducing our CO2 emissions by 40 percent on those next-day deliveries.

But overall, the global supply chain, this measure of spent revenue, we drove down by 19 percent. We're running a better, faster, cheaper organization that is more agile. As you said, it positions us better to exploit situations as they change and feel that they’ve become more of an opportunity rather than a threat.

We'd like to think that those organizations that are out there with a supply chain challenge could now look at this and say, "Maybe we could do the same thing." Definitely the alignment between business and IT is probably one of the most paramount of facets. Let me do with which platform, which network, which disk drive, or which operating system. You can have a lot of fun with that. But, in this instance, a lot of the success was driven by setting up the right governance and decision-making structure with the right sponsorship.

Over the last 12 months what people have realized that it is now time for those organizations that want to remain competitive and innovative. Unfortunately, I still see a lot of companies that believe that doing nothing is the thing to do and will just wait for the economy to rebound. I don't believe it's going to rebound to the same place. It may come back and it may be stronger, but it may end up on a different place.

The organizations that are not waiting, but are trying to be innovative, competitive, move away from the competition, and give themselves some breathing space are the ones who are going to sustain themselves.

Listen to the podcast. Find it on iTunes/iPod. Read a full transcript or download a copy.

By: Dana Gardner, Principal Analyst, Interarbor Solutions Posted: 14th May 2010 Copyright Interarbor Solutions © 2010

Increasingly, sellers of IT are finding it harder to win large software and hardware capital purchases contracts, which traditionally followed three- to seven-year obsolescence and refresh cycles. The shifts in technology and business models accelerated by the recession are forcing these vendors in particular to adopt more of a professional services revenue model.

Buyers of technology, on the other hand, are moving to IT shared services and software-as-a-service (SaaS) models to get off of the capital outlays roller coaster. They want smoother and more predictable operating and charging models, beginning with long-term professional services and outsourcing engagements.

Both the buyer and seller of services therefore need to focus on the implementation and integration of solutions, placing a complex burden on the services delivery personnel themselves, as well as those who managing the services providers.

We’re here to find out some new, best ways of managing and automating these intellectual resources that support the professional services lifecycle. We’ll see how recent research shows that more of a just-in-time (JIT) methodology is required to keep the skills in balance with myriad project requirements and obligations.

To learn more about resource utilization and management in the global services economy, we're joined by Lori Ellsworth, Vice President of Changepoint Solutions at Compuware, the sponsor of this podcast, and by Mark Sloan, Chief Operating Officer of RTM Consulting. The discussion is moderated by BriefingsDirect's Dana Gardner, principal analyst at Interarbor Solutions.

Here are some excerpts:

Ellsworth: The change and the focus on professional services is moving from something that was nice to have, to something that is necessary to have to be successful.

Software companies are a great example. Historically, companies in that sector may have done mostly product business and less service. Services are now necessary to deliver success, and the services business is a very healthy part of the software business and is contributing significantly to the bottom-line.

Now, organizations have to understand how to get a handle on the people they have working for them, how best utilize them, and how to make sure that your employees, those assets, are challenged and happy, but that you are delivering that service to provide value to your customers.

There needs to be more discipline, more information, and a better process for decision-making and forward planning, so that the organization can scale and scale in a financially successful way.

So, the stakes are higher, in terms of the discipline and the approach that we need to take to manage that professional services part of the business.

Sloan: At RTM Consulting, one of our core areas of focus is in this area of resource management. How can you get the right person in the right place at the right time and drive up utilization, but at the same time, make sure that you're delivering value to your end customers and leaving them satisfied and coming back for more?

When a software company shows up with its professional services arm, the client is expecting that each and every one of the people who show up is an expert in the software, the technology, and the implementation process. The days of people learning on the job and coming up to speed are long gone.

The challenge today is for companies to get visibility into the type of work that’s coming down the pike, so that they can proactively train their internal resources and be prepared for that work, so that when they do show up, they are the experts.

We’ve actually taken the principles of JIT manufacturing and directed them to the professional services organization [via in new service definitions of JIT.]

Just as 30 years ago, any manufacturing company had big inventories of supplies, finished products, sitting in their warehouse. Ten or 15 years ago, the big services organizations were able to have excess resources on the bench, in the office, waiting for that next project to arrive.

What we’ve done is taken those same principles -- forecasting what the future scenarios look like, what the demands look like, and then translating that back into how many resources you are going to need, the types of resources, the skills those resources need to have.

You can, at that right moment, bring on a new employee, go to a third-party contractor to fulfill that demand, or give yourself enough advanced notice to cross-train your existing resources on new technologies, new products, so that they can work across your portfolio and not just focus on one particular area.

Getting to the solution

Ellsworth: There are four critical success factors, but also the building-block approach. In other words, you need to start with the fundamental. You need to understand your people and their skills and get that view of your business. Then, you can start to add levels of maturity, look at forecasting, look at different models for resource allocation, and bring in project management.

As organizations start to put the buildings blocks in place, and adopt the disciplines and build the processes that work in their business, [they can have trouble] scaling that.

You can make that work within a small team or across a couple of small teams, but ... you need visibility ... to scale that to your entire services organization, including management. [But] you can't scale and reinforce that discipline without automation.

The two really have to go together. One won’t be successful without the other in a large professional services organization. Automation brings the scale factor.

The ability to measure and monitoring is something that Mark also highlights as critical success factors. Again, you’ve got a large group of people with a lot of activity going on. There's lots of data, but you have to roll that up to the management level to make it valuable to help drive decisions in the business.

... Our focus has been on driving that view as a professional services organization, but importantly driving that view inside the context of the broader company.

It starts with those building blocks around who are your resources, what are their capabilities, and where are they being utilized. It brings you to the next level of maturity in terms of being able to look at forecasts and do some demand and capacity planning.

And then it goes even further from a resource perspective to that professional development side. Let's look at the gaps in the next six to nine months. Where can we identify resources and put them on a development plan to fill those gaps?

We're managing the day-to-day business of a professional services organization and going beyond that to deal with project management, engagement management, and right through to billing for a professional services organization and for technology companies that also have a strong product side of a business.

The paybacks can be, and are, significant. First and foremost, is really speed to revenue and cash flow.

The Changepoint solution has been active and working with customers in their professional services organization for many years, going back to the late 1990’s. We also deliver a project portfolio management capability to allow them to manage products and manage delivery of those product applications.

Sloan: The paybacks can be, and are, significant. First and foremost, is really speed to revenue and cash flow. Lori mentioned that doing this in a large services organization is critical and an enabling technology is required to make that happen.

I’d argue the same for small professional services organizations. Having the information that tools like Changepoint can put at your fingertips, you can quickly identify people in your organization that have the right skills, that off the top of your head you might not think of, and staff projects quickly with the appropriate resources, ultimately enabling you to get that revenue.

Billable utilization

Secondly, you start to see a significant lift in overall billable utilization. This is for the professional services organization. Again, by getting better visibility into the skills that different resources have, you realize you have many more people in the organization that can do work than you think of.

For more information on resource utilization, read RTM's whitepaper "The ROI of Resource Utilization -- Measuring and Capturing the Real Business Value of Your People."

Learn more about Compuware Changepoint.

Other research points to the fact that companies who do this development of staff and get projects started on time are significantly more likely to finish their projects on budget and on time and drive significantly positive customer satisfaction.

Companies that aren’t able to do this -- take an extra five, 10, or 15 days to fill some of the slots on a project -- tend to go over-budget, don’t get it done on time, and, as a result, have poor customer satisfaction. If you think about it, it's back to that mantra, "Do it right the first time." This process helps you do that.

Ellsworth: As you're adding discipline and increasing maturity, there is participation from the practitioner, if you can position the value to them in terms of increased opportunity or an ability for them to better manage their schedule and not be burnt out. They have access to different opportunities. It's very valuable and can help them actively participate in moving the business forward and not kind of fight against it.

A broader pool of resources comes there to help you respond to customers which just increases the need to understand who those resources are and what they can bring to the table to support these services.

Customers of mine, in Europe for example, are quoting that on a year-over-year basis, they are able to reduce non-productive time -- and therefore the cost of that non-productive time -- by 16 percent.

Other customers will articulate the value of this entire solution in terms of revenue increase, the focus of getting control over their resources, who they have and how they can most effectively deploy them. Another customer of mine in Europe talks about a 30 percent increase in revenue, linked directly to implementing some of these practices in getting that control over their resources.

Sloan: The same lessons apply to shared services organizations, such as internal, large IT departments managing multiple projects per year to deploy technology.

They can leverage the technology that Changepoint offers to keep track of the people, where they are deployed, what skills they have, what new projects are coming in, and achieve a similar increase in productive utilization of those resources. But to your point, in terms of creative organizations, this would apply to any organization that is focused on moving people with particular skill sets to a unique project.

When we architect a solution for clients, it’s a unique solution taking into account the various constraints and the environment of that client.

That includes engineering services organizations, creative agencies that are moving talent from one project to the next -- anyone who relies on definite skills and knowledge that aren’t just easily interchangeable. This helps forecast where you can get the biggest bang for the buck with those people.

In terms of getting started, when we typically work with clients, we come in and do a quick assess and architect phase where we’ll take a look at how resource management is being done today, compare that to the best practices that we’ve defined for JIT Resourcing, and identify areas where you are strong and areas where there is an opportunity for change and improvement. When we architect a solution for clients, it’s a unique solution taking into account the various constraints and the environment of that client.

JIT Resourcing is a defined approach. We have recognized that there are unique aspects to every business, and can tailor the solution to fit there.

By deploying these processes now, you can start to learn the continuous improvement that’s needed, but be enabled as more and more of your clients go to SaaS, but you’ve got to have to deploy people with the moment’s notice.

You're going to get much better at predicting and forecasting what your future needs are, enabling you to align your resources and capabilities accordingly. You want to achieve the benefits we talked about -- speed to revenue, speed to cash-flow, and zero idle resources.

Listen to the podcast. Find it on iTunes/iPod and Podcast.com. Read a full transcript or download a copy. Sponsor: Compuware.

For more information on resource utilization, read RTM's whitepaper "The ROI of Resource Utilization -- Measuring and Capturing the Real Business Value of Your People."

Learn more about Compuware Changepoint.

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By: Dana Gardner, Principal Analyst, Interarbor Solutions Posted: 13th May 2010 Copyright Interarbor Solutions © 2010

Gut-wrenching recessions have a way of changing things ... for people, families, and companies. They can also, perhaps like no other event, provoke change in large IT vendors like HP, IBM, TIBCO and Oracle.

Based on this week's HP announcements and last week's IBM Impact conference, these two of the very largest, full-service, global IT vendors are betting -- now that the recession has, at the least, bottomed out -- that the extent of change now upon us is more than just another business cycle come full circle.

Far more, these vendors see that the recession has provided a catalyst for a much larger shift in how IT is done and delivered. It's no coincidence that the interest in cloud computing and innovative IT sourcing options, for example, peaked when the recession was at its deepest.

The idea garnering wide attention in the darkest days was not just to save money by downsizing, but to also to start doing things very differently -- to truly innovate, to change the very economics of IT. But now that the worst is over, simply saving money via old IT methods, I'll wager, will prove a lot more expensive in real terms than rapidly investing in new ways of providing IT value as services.

That doesn't mean that some enterprise IT organizations won't try to go right back to business as usual. And some of the IT vendors, with their license auditors in tow, are counting on it.

It does mean that the enterprises that can actually change how they do and pay for IT in the post-recession economy may have an escalating advantage over those that do not.

Not the same old song and dance

HP this week announced the equivalent of a Swiss Army knife for IT transformation, with about as many blades and instruments as there are ways to attack the data center transformation gordian knot. The HP services, software, and sourcing offerings are designed to guide enterprises -- from the starting points of their choosing -- through a seismic transition from cost containment to IT innovation. [Disclosure: HP is a sponsor of BriefingsDirect podcasts.]

Last week, IBM boldly scooped up Cast Iron Systems, a cloud-to-IT integration engine maker, and further polished its view that the way to a smarter planet is via better business processes and a deep understanding of vertical industries, automation and how IT (with professional services) can bring them together. My colleague Tony Baer at Ovum delves into IBM's recasting of the definition of business applications and acceptance of the partly cloudy future.

TIBCO this week at its annual user conference delivered a dozen major announcements and stepped even more boldly into cloud models, too. TIBCO's "Enterprise 3.0" vision emphasizes the importance of real-time and massive scale processing, an integrated development-to-deployment to business process management capability, and now the option of building out an enterprise private cloud to public cloud synergy using partners like Amazon Web Services. TIBCO is also embedding BI capabilities deeply across the portfolio. [Disclosure: TIBCO is a past-sponsor of BriefingsDirect podcasts.]

Oracle, for its part, made good on its "software, hardware, complete" vision via a cameo (and somewhat buffoon-like) appearance by Chairman and CEO Larry Ellison in the debut of the movie Iron Man 2 last week. Perhaps we should expect a fist-sized "arc reactor" for database appliances in the near future? Yet Oracle is also recently drinking deeply from the cloud well, given some its recent speeches by executives as it digests the Sun Microsystems acquisition.

The point is that these vendors know something big is up in IT, beyond business as usual. We're seeing bold moves by them all, from acquisitions to restructuring to Hollywood-delivered group-think and not-so-subliminal brand imagery.

HP tackles the IT funding conundrum

HP is looking to actually help enterprises fund these transformative times. HP's economic rationale for moving to innovation now goes beyond the need for swift and verifiable ROI in IT investments. Additionally, HP is banking on the high and painful costs of not being able to move well in dynamic markets, of incurring costs from inertia, rather than from investing for advancement.

Most urgently, IT cannot miss out in supporting businesses as they face rapid growth and savvy competitors across global markets, says HP.

More succinctly, HP's message from this week's announcements comes as a warning that going back to the old IT ways, of sliding back to the economics of expensive waste as a proxy for brittle peak reliability, risks missing the lessons of the recession.

HP is therefore taking a three-pronged approach to making adoption of innovations the new mantra of IT. The first approach finds way to deliver self-funding projects. The second leverages modern architecture and methodologies so IT organizations can quickly and easily add new functionality, making change the constant. The third approach shows how to freeing up funds trapped in on-going IT operations based on older IT economics.

As enterprises are faced with transformation from old to more modern IT, many are caught in an inertia of avoidance -- frozen by the complexity and scale of the task, according to new research supported by HP. What's needed is incremental change that pays for itself along the way, but which remains aligned with the strategic transformation and direction.

The HP focus on self-funding projects, therefore, includes offering qualified clients a complimentary, hands-on HP Applications Modernization Transformation Experience session that illustrates IT modernization and its benefits. The goal: By retiring legacy applications and eliminating complexity in technology environments, organizations are able to self-fund their modernization journeys.

Cost of lost opportunity

“The phrase ‘time is money’ rings true here, as 99 percent of organizations say that innovation gridlock cost them in lost time,” said Thomas E. Hogan, executive vice president of sales, marketing and strategy for HP Enterprise Business, in a release. “By breaking the innovation gridlock, organizations can regain time to market and capitalize on new opportunities.” More at www.hp.com/go/breakthegridlock2010.

According to research conducted on behalf of HP by Coleman Parkes Research:

• Some 95 percent of business and technology executives said innovation gridlock resulted in lost opportunities for their organizations.

• And 91 percent felt that innovation gridlock cost their organizations in lost effort (from resources). More data is available at www.hp.com/go/HPEnterpriseResearch2010.

Together the promise of cloud, the constraints of the recession, and the quick-paced requirements of modern business agility have conspired to expose the weaknesses of plain old IT ... stack upon stack, brittle apps astride brittle apps, and rack by rack of under-utilized workloads alienated from their fit-for-purpose potential.

HP says the cost of doing nothing to transform IT is too great to ignore. IBM is transforming the very definition of business services and applications with plant-wide efficiencies in mind. TIBCO is refining software delivery that steps up to the cloud challenge. Oracle is enclosing its software in an optimized "iron" support infrastructure to improve performance to cost ratios dramatically.

All these vendors will still sell you the good old IT systems the good old ways. But they are also coming up with some big new tricks. Who will take them up on their hedge against a truly transformative IT future?

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