Archive for September, 2011

Apple surfs into workplace on BYO wave

September 27th, 2011

Apple is set to become the biggest beneficiary of the bring-your-own-device to work trend that is creeping into Australian workplaces.

Companies that have trialled or adopted BYO computing are finding that, given a choice, 80 per cent of employees opt for Apple notebooks and laptops over standard corporate-issued hardware.

Information management giant EMC recently concluded a global volunteer trial of BYO computing among 2500 employees. Clive Gold, chief technology officer Australia and New Zealand, said 8 in 10 workers taking part chose either a MacBook Air or a MacBook Pro as their hybrid personal-work computer.

BYO computing is gathering pace as companies realise they can save hardware costs and improve employee motivation by allowing them to work on devices they choose. There is an expectation that support costs will also be lower if employees choose more intuitive and familiar devices.

Enterprises have traditionally been dominated by Windows compatible computers, a legacy from IBM and IBM-clone PCs of yesteryear. Apple’s biggest workplace inroads todate had been in creative industries such as graphic design and advertising.

Gold said finding that enterprise employees also want Apple was somewhat expected.

“It wasn’t a level playing field. They opted into the program because they wanted to use Apple in the first place or wanted something with more grunt. The tendency is that people who will go for BYO will be the more technical people or those who want to have something different.”

EMC will roll out optional BYO computing to all employees from early 2012. It already allows BYO smartphones. Employees will receive an allowance to purchase the device.

“I expect a lot more of the technical people will take that up. It’s the nature of the beast,” Gold said.

At Jetstar workers are also choosing Apple devices over others. Its Japanese subsidiary began with only a BYO policy in place. No company machines were issued.

“(There) we have mostly Apples – more than 80 per cent,” said Stephen Tame, CIO and head of IT.

He said in Australia Apple was also the choice of the majority of workers in the optional BYO program.

“This mix may well vary when the policy is phased in and mandated,” Tame said.

He said manufacturers like Toshiba, Dell and Samsung would likely benefit from the trend as they have adopted a “certain Apple look and feel”. Android would benefit in tablets and phones for being Apple-like but a more open platform.

However, traditional enterprise providers could lose a large chunk of their revenue if they are overlooked by employees who succumb to Apple’s lure.

Dell used to provide EMC’s corporate-issued Latitude laptops before being replaced recently by Lenovo. It is also the supplier of desktops to the Commonwealth Bank. The bank revealed this week it will be adopting Apple MacBook Airs in its new 6000-staff head office in Sydney.

Bernie Kelly, Dell general manager, public sector and large enterprise, said BYO was not threatening the company’s business.

Its Australian large enterprise revenue grew 7.5 per cent year on year, he said. But the small and medium business (SME) sector revenue grew faster at 13 per cent last year, followed by the public sector at 11 per cent.

“It is a fact this is a topic of some interest for some of our customers. We are having some discussions, but we haven’t seen any (downward) trends in our business,” Kelly said.

“We are seeing very small adoption and often as a supplement to core desktop or company-issued notebooks.”

He said through the recent acquisition of SecureWorks, cloud integrator Boomi and systems management appliance maker KACE Networks, Dell would cater for the virtualisation, system and software management, and enhanced security needed in conjunction with BYO computing.

Its new range of thinner, more stylish devices also had potential to benefit from the trend, he said.

“Vendors who would (achieve) the most success in a BYO device environment are the ones who understand that combination.”

Steve Hodgkinson, research director at research firm Ovum, said a move to user-choice would unleash frustrated enthusiasm for different and more modern devices.

“It is fair to say that the majority of large enterprise locked-down standard operating environments are based on desktops and laptops running Microsoft Windows – some of which are XP. So a move to a user-choice or BYO model will favour Apple laptops and tablets. Apple has become one of the largest IT companies in the world purely on the quality of its design and useability, so is not surprising that enterprise users would want to find out what all the fuss is about,” Hodgkinson said.

Enterprises remain committed to the Windows operation environment, however, with BYO early-adopters such as Jetstar, EMC and the Commonwealth Bank running virtualization software to deploy Windows on Apple machines.

Leanne Ward, vice president, IT outsourcing and support services, Unisys Asia Pacific, said many clients were opting for Apple, despite challenges in security, support, data ownership and standardisation.

“Employers are recognising it is an employee retention and attraction (strategy). It increases employee satisfaction,” Ward said.

“There is certainly an opportunity for companies not to spend money providing corporate-issued devices that aren’t of high value in the employees’ minds.”

A global study of information workers and IT department managers conducted by IDC for Unisys and released this month found a third of Australian employers were considering introducing a discount or stipend scheme in the next 12 months to assist employees in purchasing their own devices.

Ward expects IT support costs to decrease if Apple products are widely adopted.

“Apple do design their devices to be more intuitive. We anticipate eventually there may be less calls coming into the support desk,” Ward said.

Hodgkinson said IT departments will need to either explicitly include Apple devices in their standard operating environments or implement desktop virtualisation to make core applications device agnostic.

“Both these actions will create some new Apple-specific support costs but not necessarily increase IT costs overall because BYO and peer-support behaviours, coupled with user productivity and ‘feel good factor’ benefits, tend to create offsetting efficiencies vs. a traditional fully locked-down enterprise SOE.”

Source:http://www.smh.com.au/it-pro/business-it/apple-surfs-into-workplace-on-byo-wave-20110923-1ko2p.html

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City has potential for BPO growth

September 26th, 2011

He is considered the father of the business process outsourcing (BPO) sector and thinks Chandigarh has great potential for growth in this field.

Talking to TOI on the sidelines of ” e-Revolution”, a two-day event about information technology industry being held at a hotel in Sector 35, Raman Roy sought that facilities to improve knowledge and skill sets of Chandigarh’s youths should be upgraded so this can come true.

“Companies like Dell and Infosys have already made it big in this sector in this region. But I feel there is still a lot of possibility in the market,” Roy said.

Source:http://articles.timesofindia.indiatimes.com/2011-09-24/chandigarh/30197801_1_bpo-sector-bpo-growth-raman-roy

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Kenya finds it tough attracting BPO business

September 26th, 2011

Kenya’s efforts to compete with India, Mauritius and South Africa as a Business Process Outsourcing (BPO) destination have hit a snag, with many companies closing or scaling down operations.

Four years ago, the country was optimistic about BPO operations, with the cost of connectivity set to come down with the entry of fiber optic cables. Reliance on satellite had been cited as a major hindrance to BPO growth and profitability and the formation of the Kenya ICT Board was seen as a major marketing avenue.

The World Bank also weighed in with a grant that was expected to benefit the BPO sector. However, it took two years before the grant was disbursed and in the process some companies had collapsed or explored other business ideas.

“Unfortunately the initial subsidy investment did not deliver any benefits that can generally define the industry; we realized this just in time and restructured the support to focus on sector development,” said Eunice Kariuki, Marketing Director, Kenya ICT Board.

Even with cheaper connectivity, the BPO sector was unable to compete with India, Mauritius and South Africa because the focus was on voice and contact sector services. The board, however, has had challenges working with BPO operators to expand operations from traditional data entry and customer care to IT enabled services and software development, which calls for higher skills set and longer periods of marketing and getting clients.

This has forced the board to focus on sectorwide initiatives like BPO training, software certification and business incubation.

“The sector now enjoys good infrastructure and the government continues to fix the legal issues that are often cited as setbacks; the board has also devised innovative ways to market the industry, leveraging on existing world bank funded projects,” Kariuki added.

While the industry may look gloomy for voice and contact center services, companies that focussed on software development and IT shared services seem to be performing better.

“Yes, the industry has had challenges but it takes time,” said Agosta Liko, CEO and founder of Verviant Consulting, a software development firm with clients in U.S., Europe and New Zealand. “For us it’s one customer at a time, we have just finished one contract and got two more because our work was good.”

Industry and business prospects may have been overestimated, which Liko said may have made some companies to expect too much too soon, affecting their performance and survival.

The local market had also been a target of the ICT board’s efforts, which yielded fruit with Telkom Kenya signing an agreement with a local call center, and Airtel outsourcing to IBM, which handles Airtel services in India.

However, Safaricom opted to sort out its own call center, and says it has reaped benefits. While Safaricom is seen as a potential major source of business by local BPO, marketing efforts have been unable to convince the company that outsourcing will lead to lower costs and more subscribers.

“We see our call centre as a partner to our sales and product development that promotes product uptake,” said Nzioka Waita, Safaricom corporate affairs director. “It partners with our marketing team to provide insights into and on marketing campaigns based on customer feedback and some of our call centre staff have grown to become experts when it comes to customers and what they want.”

Asked why the company has not considered outsourcing to local BPO, Waita points at increased call uptake and query resolution because callers can access the company faster and the incorporation of social media- Twitter, Facebook and email in resolving client issues.

“Through data mining and continuous provision of feedback on customer experience to our internal product development teams, Safaricom has become a leader in innovation and made great inroads in building market share,” added Waita.

Source:http://news.idg.no/cw/art.cfm?id=E9E3354F-1A64-6A71-CE25571CF0716968

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Wipro to sell data centres and other computer hardware assets of Infocrossing

September 26th, 2011

India’s third biggest software exporter Wipro is evaluating options to sell data centres and other computer hardware assets of its US subsidiary Infocrossing to unlock value from what the company now calls ‘non-core’ business, people familiar with the discussions said last week.

At least five persons, including officials and bankers, said Wipro has already received initial offers from several medium to large US telcos, and the company is deliberating to carve out five data centres owned by Infocrossing for a potential sale estimated to be worth anywhere between $300 million and $400 million.

“This part of Infocrossing (data centres) is not a game changer we want over next three-five years,” the first person said on conditions of anonymity because these discussions are at an early stage. The person also added that Citigroup is currently holding discussions with potential buyers.

“Interests received so far are unsolicited. As of now there is more than one potential bidder,” he added. When contacted, a Wipro spokesman declined to offer any comments as the company is in a silent period ahead of its earnings announcement next month. In August 2007, Wipro had acquired Infocrossing for $600 million, with then revenues of around $200 million.

At that time, the company had plans to increase Infocrossing revenues five-fold to $1 billion by 2010. “There is a realisation now that customers do not make decisions based on whether a vendor owns data centres or not – a proposition clearly visible when Infocrossing was acquired,” another person intimately familiar with Wipro’s acquisition strategy said.

Among domestic peers, Wipro has been most aggressive in pursuing and making acquisitions having bought some 28 firms across the businesses of technology, lighting and retail. In April this year, Wipro acquired oil and gas IT practice of US-headquartered SAIC for $150 million in an allcash deal. Infocrossing has been the biggest acquisition Wipro has made so far.

Another person directly involved in these discussions ruled out complete sale of Infocrossing, which contributes revenues to Wipro from the lucrative healthcare business. Infocrossing counts Nestle, BP, Capital One and Best Buy among its top customers.

“Nearly a third of Infocrossing revenues are from healthcare clients, a segment which remains big strategic play for Wipro,” the third person, who is also familiar with the internal discussions, said. “The idea is more about unlocking value from non-strategic part than giving up the entire unit,” he added.

Infocrossing is headed by Martha Bejar who is the chairperson and CEO, and has around 1,000 staff in the US. While data centres are being considered non-core by outsourcing vendors, telecom firms such as AT&T and Verizon are increasing investments in such facilities to host and offer applications using the cloud computing model.

According to US-based Datacenter Dynamics, companies in the US will invest nearly $9.5 billion next year in data centers. On its part, Wipro has been attempting to offer outsourcing services bundled with computer data centres with customers such as Citigroup.

Last year, Wipro even acquired a Citigroup data center in Meerbusch, Germany. “The part of Infocrossing, which currently offers these integrated services, is not something that can be sold. Data centres in the US are being considered to be sold,” the fourth person said requesting anonymity because Wipro has not officially mandated any investment banking firm for this sale.

Source:http://economictimes.indiatimes.com/news/news-by-industry/telecom/wipro-to-sell-data-centres-and-other-computer-hardware-assets-of-infocrossing/articleshow/10120689.cms

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Biggies yet to find IT park hot property

September 26th, 2011

Rajiv Gandhi Chandigarh Technology Park (RGCTP) set up with much fanfare has failed to yield desired results with its scope being limited to only business process outsourcing (BPO) industry.

The park was aimed at attracting big IT businesses but not many bigwigs, except Infosys, have established base here. “In the first phase of IT park, space was provided to five IT companies and eight others in the second phase.

Initially, there were many ambiguities and controversies surrounding the IT park project that led to delay in overall development. IT companies were not clear about many procedures and so did not shift their high-end operations to the IT park. But since last few months, things have started getting clearer and we are optimistic that by next year, all 13 companies will start operating to the full potential,” Partap Aggarwal, managing director of IDS Infotech said.

Puneet Bhalla, a young entrepreneur, who is into the business of designing websites and highly precision instruments, told TOI, “When I graduated from an engineering college, I tried to take land in the IT park. But there was lot of red-tapism and my file kept moving from one department to another.”

“Earlier projects got delayed and disrupted due to various reasons. Companies also became suspicious and showed less interest in the IT park. But now we are trying our best to make the atmosphere congenial for growth of IT industry,” V K Singh, Chandigarh’s finance secretary, told TOI.

Source:http://timesofindia.indiatimes.com/city/chandigarh/Biggies-yet-to-find-IT-park-hot-property/articleshow/10110297.cms

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Indian IT: weak rupee a mixed blessing

September 26th, 2011

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As the rupee on Friday hit its lowest point since May 2009 – at 49.89 rupees to a dollar – one of the key beneficiaries of depreciation would seem to be India’s vaunted IT outsourcing sector.
But analysts told beyondbrics that while the weak rupee is a positive for the industry, the effect could be muted by the sheer instability of today’s global currency markets and the industry’s growing complexity. Still, IT companies could take some comfort this week – the sector’s shares outperformed most others in the general mayhem.
Currency volatility is something IT firms like Wipro, Infosys and Tata Consultancy Services have come to expect, said Shashi Bhusan, IT analyst at Prabhudas Lilladher. There’s no indication as to how long the Indian currency will continue its drop below the 50 rupees per dollar level. So companies tend not to base their strategy on short-term fx volatility – the rupee’s drop from 46 against the dollar to nearly 50 occurred in just 7 trading sessions.
“Currency movement is like [a] wildcard; it’s inevitable risk or reward for any of the outsources or exporters,” said Bhusan. “So most of the companies work on two to three quarters of hedging: everybody is nimble footed on this, it’s part of the business.”
Industry-wide exports totaled $59.4bn in the fiscal year ending in March 2011 – around 26 per cent of India’s total exports – up 15.7 per cent from $50.1bn in 2010, according to NASSCOM, an industry trade body.
As a result of increased profits, and lower US labour costs, Indian IT companies now spend a portion of the money they earn in dollars on pay for US-based staff.
“Offshore is still very much there but there is a lot of onshore recruiting that companies are doing,” said Pradeep Udhas, national head of the IT BPO sector at KPMG. “So to that extent it will not be positive or negative because a lot of the earnings will be in dollars and they’re also paying in dollars there.”
While a weak rupee, generally, is a good thing for exporters, the head of NASSOM told beyondbrics that because IT companies import much of their technology into India, the weak rupee can actually also have a negative impact.
“We’re looking at huge expenditure in the IT space, [and] we’re afraid the IT industry will become quite expensive here,” said Som Mittal, president of Nasscom.
“But we want a much more stable currency regime,” Mittal added. “So either the rupee depreciating or appreciating, we don’t want that impacting our day to day.”
The depreciation seems to have positively affected the industry this week, said Srishti Anand, IT analyst at Angel Broking. The Bombay Stock Exchange’s Teck index, which includes India’s biggest IT companies, was down 2.26 per cent this week, about half of the benchmark Sensex’s 4.56 per cent decrease.
“The global economy is the demand driver for Indian IT, [and so] probably Indian IT should underperform the Sensex in that sense,” Anand told beyondbrics. “But the downfall has been restricted by some amount of comfort seen through the rupee, and that’s why the downfall was not as steep as the Sensex for this week.”

Source:http://blogs.ft.com/beyond-brics/2011/09/23/indian-it-weak-rupee-a-mixed-blessing/#axzz1Z1aXskrY

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A warning from HP: Don’t get fired over the cloud

September 26th, 2011

In the future, CIOs will get fired for becoming beguiled by the tyranny of choice offered by cloud computing. They will lose control of which applications are running where and where servers are physically located. Costs will run out of control as systems are spun up and left running. And when outages are suffered and the CIO doesn’t know about it, that too will lead to a swift and ignominious exit.

But it is not all bad news. These things can be avoided.

Pete Karolczak, SVP and general manager of Infrastructure Technology Outsourcing at HP Enterprise Services, welcomes the end of traditional outsourcing and embraces the disruption of cloud computing. He says he believes HP’s Enterprise Cloud Services is positioning the company to deliver against real requirements in the market while avoiding the pitfalls that will befall the unwary (at least for the parts that his clients entrust to him).

What the cloud means for wholesale outsourcing is nothing more than an end to the traditional ‘mess for less’ contracts that have dominated the industry since its inception. The challenges of traditional outsourcing contracts, the longevity, the controversy, the legacy and the contract negotiations or renegotiations are about to become yesterday’s war. With wholesale outsourcing, the issue was often about how many processes and their supporting technologies and people would shift to a single third-party supplier.

Today, the cloud does not mean there will be less outsourcing but the landscape will be very different. This landscape will consist of clusters of services. And from a supplier’s perspective this means choosing to operate in markets that guarantee a win.

THE NEW WORLD ORDER
Karolczak welcomes the end of traditional outsourcing. “I recognize it, I’m leading it; I embrace the end of comprehensive outsourcing. It will be replaced by more discreet clusters of services. For my end user [of the future], the application hosting environment, the web hosting environment, the back office enterprise resource planning (ERP) will all be with different suppliers while the network could be at another supplier,” Karolczak says.

“Let’s take data center hosting. You could run your apps in someone’s public cloud. You could try three providers and decide which one you prefer and after one year choose a preferred supplier. The switching costs are relatively low.”

Karolczak advises providers to think as the customer would. “They will be seduced by choice and fragment their operations so entirely that they will regret it within two years. The good news is that we’re going to help them and some will be enlightened enough to help themselves.”

Take for example Infrastructure-as-a-Service (IaaS) and network service provision. Within these offerings there will still be a lot of areas the customer will want to manage itself. Karolczak says as a result he believes we’ll see more and more customers adopting a multiple choice approach when it comes to services.

THE DANGER IN CHANGE
But here’s the rub: “You will be fired as a CIO if you don’t know where things are running. You will be fired if something goes down and you don’t know about it. If you are a CIO and some of your apps are running on Amazon and you don’t know about it then your costs are running out of control. If they are running a mission-critical app and it gets breached, you will get fired.”

Much of this comes down to service management and security. “Those horizontals must traverse this fragmented world of choice. Service management in the New World Order changes dramatically,” Karolczak says. “In the Cloud you had better know which applications are in the Cloud and which cloud they sit on. One of the delusions of the Cloud is that you have unlimited bursts of separation. But you can’t, in most situations, separate the apps from the Cloud.”

No one jumps to the future state instantaneously, and there are key differences between the traditional outsourcing deal and the cloud options, he says.

“The beauty of the cloud is that you don’t need to move all 2,000 applications at once. You move one app at a time, pilot one and then move three. This is the perpetually hybrid model. You’ll never be in a future state because once you get there there will be a new future state.”

This acceptance of forever being in flux appears to be a major, if little recognized, aspect of moving to the Cloud.

More and more customers will take this route, Karolczak says. Within large suppliers every major service line will expose its new generation as a service offering. Every new customer or renewal of existing deal is looking at going discreet. “I will try to win seven out of seven, or I will look to win three out of seven [cloud deals from one company],” Karolczak says, highlighting the fragmentation that is about to become a major part of outsourcing.

RETHINKING APPS
The attraction of all of this disruption is the promised reduction in cost and introduction of flexibility. Karolcak says the beauty of cloud is that it is a destination that is so much cheaper than anything ever seen.

“By the nature of the destination this is a pennies on the dollar offering,” Karolczak says. But then you must think of how you get there. “You need to transform your apps to get there,” he says. “There is no such thing as free cloud. The annuity business is cheap, and you need to rewrite your apps to get to the cloud. You need to stop expecting customized infrastructure for every app. You need to change your apps not to care. If you need high availability you need to build it into the app.”

“We (HP) are also focusing on the journey to help customers take advantage of the annuity price point. But the next time you install SAP you can’t run it on Amazon, it doesn’t work that way. Even on a hardened cloud, it is more standardized than anything before in order to hit the price point,” Karolczak says.

“In the past we have trained our application teams to have the infrastructure customized for them and now we need to wean them from that. The apps need to run on standardized infrastructure which is the nature of cloud.” It is not ‘one size fits all’ and there are options in configurations which mean you most certainly can’t say: “I want it exactly the way I always had it.” The apps need to modernize to fit on the Cloud.

FROM CHAOS…
“The beauty of cloud — this spill and fill —changes what was operation’s worst enemy. You can pay as you go (because you don’t have to put the 1,000 servers in the Cloud).” Managing change more methodically means your journey to the Cloud is not as chaotic. “It is risky,” Karolczak says. “But pay-as-you go is really good for you and really good for me. I don’t inadvertently sign up for a fixed contract and lose money because I guessed wrong. You don’t put me out of business and I don’t put you out of business because I’m milking you dry. It is a natural intuitive commercial model. Commercials are tough enough and whenever you have a predictable commercial model it is actually a good thing.”

“It is also outcome based. The phone bill isn’t a $1bn black-box bill, but it is a line item — if you turn the knob to the right the volume goes up.” The cloud also promises repeatability. The more consistent, the more reliable, the more scaleable means the better the quality. Suppliers will be happy to have fewer escalations, and customers will as well. The cloud also gets outsourcing suppliers out of the ‘mess for less’ outsourcing model. “We actually get to become really good at certain things we do well multiple times. Mess for less is a hard business,” he says.

THE CLOUD FOR HP
So where is HP with its cloud goals?

“When you set up an enterprise cloud instance — it is like a hotel — I can’t sell rooms until I build the hotel and I can’t build the hotel until I own the land. The good news is I own a lot of land, a lot of data centers around the world. I first need to build the core then I can start adding blades,” Karolczak says.

HP is going to set up ten-plus cores around the world. (“We’re still doing business planning.”) He says: “That will include an equally large number for messaging collaboration cloud services. So by the end of 2012 we’ll have global presence in cloud and those customers who are able to move will start the journey. Will anybody be 100% moved by the end of 2012, I doubt it.”

Source:http://www.datacenterdynamics.com/focus/archive/2011/09/dont-get-fired-over-the-cloud

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