Posts Tagged ‘CIO’

9 Things IT Pros Are Doing Instead Of Managing Infrastructure

December 19th, 2014

For IT staff, the old days of “rack and stack” are  giving way to a new professional model—IT services business relationship manager.Outsourcing23

In this capacity, IT is seen as a partner with business leaders and functional department heads, assisting and delivering technology project needs with a keen eye on security, audit and compliance. The changing role of IT professionals is due in large part to the increased use of outsourcing, the continuing migration to software-as-a-service offerings, as well as enabling an increasingly mobile workforce with new apps.

According to Doug Shoupp, Deloitte Consulting’s chief technology strategy officer, IT departments at larger enterprises that have invested in big iron technology infrastructures are “somewhere in the middle of this transformation.” In Shoupp’s experience, IT at small and midsize companies is often further ahead when it comes to the cloud.

color city concept

Now that they’re loosening their tool belts, here’s how Shoupp and other experts see IT pros are spending their extra time:

1. Becoming tech portfolio managers

“They’re evolving from a ‘technologist,’ someone who builds a software stack, into someone who manages a portfolio and the delivery of technology services,” says Joseph Pucciarelli, vice president and executive adviser at IDC.

2. Developing business relationship models

“Other than building, running and operating their own stuff like they used to, and ordering hardware, they’re moving to a business relationship model, where they facilitate business needs but don’t necessarily do this themselves,” says Phil Shelley, former CTO at Sears Holdings and currently president of Newton Park Partners LLC.

3. Managing outside contractors

“Instead of some poor CIO worrying if the system is up and running, now they have a contracted relationship with an outside party who has to worry about these things,” Shoupp says. Less worry, more productivity.

4. Focusing on architecture integration

IT is shifting its attention from upgrading the system and maintaining the applications—“fixing bugs”—to architecture integration and data analysis, Shoupp says. “More manpower will be distributed to these areas.”

5. Bridging business and cloud

“I just worked with a client on a tech project who used to order hardware under the traditional model, but now serves as a liaison between the business and the cloud-service provider,” Shelley says. “The provider now handles the hardware.”

6. Taking on new management responsibilities

IT’s evolving tasks are resulting in “an elevation of responsibility,” Pucciarelli says. With that said, many companies are finding that IT staff need more training to rise to the new tasks. “When we look at an IT organization, the biggest shortfall is the lack of management talent.”

7. Rising up the organizational ladder

Assuming such talent is in place, and “the really ‘blood and guts’ technology stuff is moved to external providers,” Pucciarelli says, IT will become “in some ways more senior.”

8. Wrangling big data

“Chief responsibilities of IT now include data architecture, master data management and technology integration, security and orchestration—how external data can be married to internal data,” Shoupp says.

9. Evaluating tech for new opportunities

Finally, one can expect IT to do more of what many other employees do in their “free” time—look for mobile business apps that make work more efficient. The difference is they can now turn this rogue technology into a purposeful tool tomorrow.

As IT’s role in business continues to shift and transform, IT pros certainly aren’t putting their feet up and slacking off.  They’re becoming an increasingly integral part of business at every level.


Analysis And Procurement: Where The IT Jobs Will Be

November 19th, 2014

In a panel discussion with three prominent local chief information officers (CIOs) earlier this week at the event, those two familiar ideas kept recurring. Firstly, the need for IT workers to truly “understand the business”, with analytics as one way to add value in that area. Secondly, the need to be able to manage an increasingly diverse set of suppliers, especially when individual business units are sourcing their own tech.Outsourcing2

The upside is that this can change the approach to IT from a traditional penny-pinching mentality. “In our organisation we’re seeing a massive shift in demand from the business and as we demonstrate understanding of the business, we’re seeing lots of opportunities,” said Shaun Nesbitt, CIO for SEQ Water. “In the past all we had was a focus on cutting costs.”

Even when departments source their own tech, central IT can play a role in making sure data from those systems is cross-referenced and analysed, Nesbitt said. “The value IT brings to the table is the ability to look across silos.”

“In terms of skills, we’ve had to make some pretty tough decisions. We know we can’t do everything, and we know industry can do some things much better, hence there’s an increase in vendor management skills — so you can pick the right ones.”

That task has been exacerbated through the mergers of various authorities to form SEQ Water: “there’s a whole bunch of spaghetti that needs to be unravelled,” Nesbitt said.

For more specialised IT tasks, outsourcing remains a popular choice, which again brings procurement and vendor management skills to the fore. “The answer for me is outsource every time,” said Ross McKinnon, CIO for jewellery chain Michael Hill. “If I had to skill my guys on putting chips on motherboards or learning C, it’s going to take a lot longer than two years.

McKinnon’s preferred approach when outsourcing is to ensure some level of skills transfer, so there isn’t an ongoing dependency. He’s also a big fan of numerous small pilots, though that does mean not everything will succeed. “It means lot more piloting. We’ve had one running in three US stores for two months and we’ve found lots of bugs. Another has been running in Queensland for six weeks virtually bug-free, so we want to roll that out in January. The ability to work quickly and for shorter periods is going to become increasingly important.”

“The fundamental change is changing from the boxes and wire to information as a resource — being able to tap into information as a resource is a classic conundrum,” said Chris Turnbull, CIO for Queensland Treasury and Trade. It’s a technology issue that isn’t resolved by technology. At a practical level, the skills we need in house are markedly different: business analysis skills, and vendor management and procurement skills.”

Enforcing those changes is also complicated, Turnbull said. “There’s a management challenge there to understand the philosophy, the religious zeal for doing things in a particular way.”

Ultimately, IT isn’t going away. “Somebody always needs to interpret the technical world to an organisation, but it comes down to how that technology is used,” Turnbull said.


How to Build a Better IT Outsourcing Benchmarking Process

November 11th, 2014

As customers look to take advantage of a competitive IT outsourcing market, benchmarking is more important than ever. Service providers and customers are exploring ways to build a better benchmarking process that will benefit all parties.Outsourcing25

Benchmarking is an important tool to ensure competitive pricing over the course of an IT outsourcing deal. And while benchmarking clauses remain standard in most outsourcing contracts, fewer customers have been invoking their rights to compare their service provider’s costs to market averages in recent years.

“Partly this was a function of the recession. Consulting budgets fell victim as companies were squeezed for resources, so overall there was little being done in the way of benchmarking and related services,” says Howard Davies, managing director at outsourcing consultancy Alsbridge. “CIOs were trying to do things on their own and negotiate their contracts without the benefit of external data.”


CIOs have erratic IT services pricing on their side

November 6th, 2014

The IT services sector is experiencing erratic pricing as western suppliers attempt to retain their corporate customers amid huge competitive pressure from offshore suppliers.Outsourcing17

Large corporates, once cautious about working with offshore players, today recognise operating model advantages over western players and no longer show trepidation because they have worked with offshore players for years now.

But things are changing, with companies such as Tata Consultancy Services (TCS) fighting for deals with established western firms as equals rather than upstarts. This is resulting in incumbent suppliers being forced to cut prices to retain large clients.

Losing major accounts is bad news for large western suppliers listed on the stockmarket because they need to retain revenue growth.

Peter Schumacher, CEO at management consultancy Value Leadership Group, which has spoken to hundreds of large European businesses about their IT outsourcing plans, said while there is still a lack of understanding about just how big some of the Indian suppliers are, it is beginning to sink in.

“In Europe, customers recognise that offshore firms offer significant operating model advantages over western IT services companies, which are seen as still struggling to adapt their largely conventional and fragmented country-focused model to the new competitive realities,” he added.

“Meanwhile, the offshore firms have established very strong positions in key sectors, where the biggest customers see them as being on par with companies like IBM,” said Schumacher.

He said this is giving CIOs a bargaining tool when contracts are up for renewal with the large western service providers, which is causing erratic pricing.

“The stronger presence of the offshore firms has given clients enormous bargaining power, which they are using to extract pricing concessions and renegotiate contracts,” Schumacher added.

Outsourcing is not all about price
Recent research by the National Outsourcing Association (NOA) revealed that 54% of outsourcing buyers gave cost reduction as the main reason for doing so, while 36% said improved services were the main driver. The remaining 10% cited access to other value-add services as the top reason.

According to the survey of NOA members, suppliers are promising cost savings, with 60% offering savings of between 11% and 30%, but 57% of executives buying the services expect savings of between 21% and 40%.

But it is no longer just about price – although still the main factor, it is diminishing in importance. Offshore suppliers that have not readied themselves for changing buying habits will struggle.

While TCS is gaining huge ground on western companies, and was even described by one commentator as IBM Global Services’ biggest competitor, this is not the case for all offshore suppliers.

A lack of service innovation will hold many offshore suppliers back, according to Ilan Oshri, a professor at Loughborough School of Business.

He said the Indian suppliers have their own challenges in reducing their reliance on models that are based on the provision of low-cost skills: “From discussions we have had, it seems some of the Indian firms are under pressure because they are not pursuing strategies outside offshore models.

“Companies such as IBM have developed hybrid models that combine offshore delivery with innovation. IBM has been doing this for five or six years, but many Indian firms have not focused on that.”


Federal IT Leaders Look for Trust, Transparency in Cloud Vendors

November 3rd, 2014

As the FedRAMP security certification standard evolves, government tech officials are having an easier time evaluating private cloud offerings. However, they caution that trust and vendor relationships are key, and regardless, some sensitive applications will remain in-house.Outsourcing5

Even as federal agencies have been warming to the opportunities that commercial cloud service providers can offer, the transition is gradual, as government IT officials continue to express concerns about service agreements and turning over sensitive applications to outside vendors.

Throughout the contracting process, officials stress the importance of developing trust between the agency and the service provider, urging contractors to tailor SLAs to address security concerns, worries about vendor lock-in and clearly defined roles and responsibilities.

“Transparency is key,” Melinda Rogers, CISO at the Department of Justice, said recently at a panel discussion hosted by Federal News Radio. “Transparency on service, transparency on cost.”

FedRAMP Certification is First Step in Government Cloud Conversation

The government’s move to the cloud has been hastened to some degree by the implementation of the Federal Risk and Authorization Management Program (FedRAMP), a standardized, government-wide security review and authorization process for private-sector cloud offerings, one that federal officials say has become essential for vendors to win contracts.

“That’s your baseline. That’s kind of your price of entry,” says Gary Barlet, CIO at the U.S. Postal Service’s Office of Inspector General.

“The very first question you ask is … [vendors] must be FedRAMP certified — are you, yes or no? If the answer’s no, you’re done. It’s one of those deals where if you don’t pass a minimum price of entry, there’s no reason to continue to have a conversation about it,” Barlet says.

The idea of a common certification that is recognized across the government offers vendors a single development template — albeit a rigorous one — to replace the patchwork of department and agency standards that have bedeviled federal IT contractors for years.

Cloud vendors, however, have still been able to submit their products for an agency-specific review, or to go through the more exhaustive evaluation of the Joint Authorization Board, or JAB, which, if successful, confers a certification to operate across the government.

“It’s a very taxing process,” Mark Williams, CSO at Microsoft’s federal division, says of the JAB review.

Not only do vendors have to pass their products through that stringent review process and furnish volumes of documentation, there is also something of a logjam in the review process, according to Williams. So Microsoft, like other cloud service providers, has been winning gradual approval for its offerings, but the FedRAMP review boards have unable to keep up with the volume of products vendors have been submitting for approval.

“Our services are slowly getting through, but not at the rate we need,” he says.

But even once a commercial cloud product passes through that review process, vendors may still face skeptical government buyers. For all the inter-agency work in developing FedRAMP as a common security standard, many officials still remain on edge about the various cloud models, and insist that some sensitive applications will remain on-premises or hosted in a government cloud.

At the Postal Service, for instance, Barlet’s team was considering which applications would be good candidates for a cloud migration, and ended up transitioning some processes like the organization’s project management software. But the agency’s more complex case-management software, it was ultimately decided, was too elaborate and carried too many unique specifications to shift to a third-party provider.

“Because of all the extra requirements, it just seemed a little safer to keep that in-house,” Barlet says.

Security Still Chief Impediment to Government Move to Cloud

Security has long been cited as a chief impediment to the government’s move to the cloud and its partnership with commercial providers. Much of that comes down to an issue of trust, according to Steve Hernandez, CISO at the Department of Health and Human Services’ Office of Inspector General, who urges vendors to be more forthcoming with information about their risks and vulnerabilities in their conversations with government buyers.

“We need to know beforehand what type of risk we’re assuming, and to do that we need accurate vulnerability information from these cloud providers,” Hernandez says. “What can happen is you can end up being collateral damage because another agency or commercial provider was hit.”

Officials have also been slow to warm up to the cloud brokerage initiative that the General Services Administration has been developing, inviting cloud services firms to establish themselves as brokers who would help government agencies purchase and deploy cloud products from other vendors.

At the outset, some officials are wary of that model for introducing added layers of complexity, particularly when federal CIOs already worry about outsourcing critical applications to commercial vendors.

“Maybe at some point we’ll get there,” Barlet says. “But I don’t know if it’s going to come any time soon.”


The IT Freedom Movement

October 7th, 2014

Poet Robert Frost once said, “Freedom lies in being bold.” It’s the ability to take charge of your destiny and to make the tough choices necessary to drive freedom. This is especially important when applied to today’s IT infrastructure.Outsourcing49

The IT infrastructure is becoming increasingly complex. The vast amount of data being generated by businesses – from customer relationship management and accounting to e-mails and Word documents – creates a flood of data to be stored and managed. At the same time, emergence of such forces as cloud, data center integration, and increasing security threats creates an added layer of confusion. Unfortunately, CIOs are being forced to do more with less as IT budgets are closely monitored.

It’s estimated many IT groups spend more than three-fourths of their resources on managing the infrastructure, that means a large majority of IT staff and resources are just “keeping the lights on.” This means that investments of less than 25 percent are on innovation. So IT leaders must investigate new ways to get creative, be bold and gain freedom from the day-to-day busy work.

For many, the ability to outsource and create a hybrid IT infrastructure is the answer. Recently, we conducted a survey of 550 global IT leaders. In the analysis, we found companies can save up to 11 percent of IT budgets by outsourcing day-to-day routines. The same group noted they expect to increase investments in outsourcing 19 percent within the next two years. This leaves more room for innovation.

In its 2012 paper, “Converging the Datacenter Infrastructure: Why, How, So What,” IDC reinforces this theory. The analyst firm reports by outsourcing one-third of infrastructure and related routine administrative tasks, CIOs can double the time spent on implementing innovative products and offerings. Talk about being bold and taking charge of your freedom!

With an estimated market size approaching $43 billion, colocation is a viable alternative for those looking to streamline IT costs, enhance reliability, and prepare for future growth. The IT model allows companies to house servers or devices in a third-party data center and rent space for these technologies or future additions. The provider also handles building, power, cooling, bandwidth, and security. Hybrid IT infrastructures – driven by colocation – also enable companies to reap many rewards in addition to innovation. These include:

·Reliability: Industry analyst firm Aberdeen Group found the average cost of downtime for an organization rose 65 percent between 2010 and 2012 – to $160,000 per hour. A good colocation provider offers multiple layers of redundancy and power infrastructures to ensure this costly downtime is avoided.

·Scalability: Data center colocation lets companies take advantage of an outsourcing partner’s economies of scale, proven reliability, geographic reach and technology.
·Disaster Recovery: Protecting a company’s assets from disaster has become the No. 1 concern for many businesses. Colocation providers design their sites specifically to protect against data loss. Built into base services are strategies to enhance back-up (Data Loss Prevention) and those to get the business going in the event of total failure (Disaster Recovery).

To remain competitive and stay ahead of the curve, CIOs must do more with less. The flood of data has put IT managers under extreme pressure, yet a majority of staff time is spent on day-to-day management – rather than forward-thinking vision necessary to create a more powerful infrastructure. For many, colocation has become the answer. It’s more than just a strategy, it’s a way for CIOs to take charge, be bold and gain the freedom necessary to innovate.

Frost was right…and data center managers need to take notice.


How Digital Labor Reduces Business and IT Costs

October 7th, 2014

In a previous article, “How Digital Labor Is Transforming IT,” I discussed robotic process automation (RPA) and how it will ultimately change outsourcing, hence the idiom “Shift Beyond Labor Arbitration” (SHiBLA). This impactful technology, which involves the application of software to perform high-volume business processes and IT functions, promises to change the old labor model by increasing efficiency and significantly reducing costs.Outsourcing46

Here, I’ll discuss the math of the cost savings and benefits that SHiBLA (pronounced Shee-Blah) supports and can’t be ignored.

RPA is the next wave in technology and its promise is increased productivity, reduced errors and cycle time, and much-improved scalability. RPA means we have morphed from an analog style of “knowledge swap” from people to people to a digital world where knowledge is transferred by robots. We are no longer looking at RPA as a future technology, as it’s already taking over physical labor today and, in order to succeed in the business world, CIOs need to understand its impact on the enterprise.

RPA has proven in recent experiences to increase business process savings by 25-40 percent in most markets. Industry advisors state that 25 percent is very conservative and 40 percent is trending to be the norm. However, in the IT labor markets, providers are seeing as much as 40-55 percent cost savings, as the productivity and accuracy of three software robots equal one full-time employee. The capability of RPA is far more than 3 to 1, but the scale is not here yet. The adoption of RPA is a function of the market. Like most new technologies, until you can actually see the savings, there is a lot of skepticism.

One major RPA provider has, on average, seen compressed cycle times with the implementation of automation. In one example, the provider implemented RPA technology over a one-year time frame to change the business dynamic to 80 percent automation, which ultimately provided their client with a 45 percent net savings in costs. Another use case has shown the rapid deployment of automation for a major commercial bank by leveraging autonomics and learning algorithms. In this case study, the bank supported 5,000 databases; within the first six months the bank was able to automate to the point that the client needed only 50 percent of its original headcount to do the job. Not only did this implementation increase efficiency and production, but it ultimately produced a 60 percent cost savings. These two examples show progression over time, and how autonomics scale at a much faster rate than the physical world. As technology and demand improve, deployment and implementation time will shrink at astonishing rates, according to major players in the space.

A Shift in Mindset

Many foresee that enterprises are shifting from an “I grow by full-time employees” to an “I grow by transactions and customer experiences” mindset. Software has certainly trended to show that it is progressively controlling the ecosystem, and it is plausible that a machine can do what no human can do. CIOs are wondering what’s next, and the timing couldn’t be better as this is a sea change in the relationship of people, technology and business.

In an interview with a large telecom conducted by The Institute for Robotic Process Automation, findings showed how labor arbitrage is driving decisions to utilize robotic automation. This company had 30 major systems that it automated in its business process management (BPM) solutions suite, but it also had 400 processes in its back office, which is a prime target for robotic automation. Of those 400 processes, the telecom believes about 75 percent could be completely automated. But the company is not going to replace its BPM solutions. It’s actually going to leverage those, and extend automation deeper to alleviate error and increase productivity which, in turn, reduces the cost of manual labor.

As we move forward, let’s keep in mind that the traditional outsourcing model, which has relied on low-cost offshore labor for the past 20 years, seems suddenly anemic in contrast to the innovative potential of automation. In fact, the impact of RPA on outsourcing will go far beyond the cost savings of labor arbitrage, and will make you rethink how automation can change your company’s IT and business processes.

It’s no wonder RPA will play an important role in the future. We have always seen businesses as people-based but supported by software, and it is easy to predict that outsourcing will shift to software-based but supported on the perimeter by people. Virtual machines are the next wave of the future.

The shift to RPA will dramatically and permanently change the business and pricing models in the ITO and BPO arena. It will provide a great advantage for CIOs—and be dangerously disruptive for the many businesses that do not make the pivot. ShiBLA is here to stay, which means it is time for many CIOs to update their playbooks.


Protected by تهنئة
Get Adobe Flash player