Posts Tagged ‘Cloud’

The Future of BPO: How Human Cloud and Infrastructure Cloud Are Changing the Game

April 23rd, 2014

The Cloud is fast evolving and empowering small enterprises with remote workforces to compete on par with larger businesses. Global collaboration and resource pooling is overcoming traditional constraints of geography and infrastructure, while the Cloud has created a level playing field for all businesses irrespective of size and location. Entrepreneurs are finding ways to collaborate and significantly reduce the time to develop and deploy products. An easy access to state-of-the-art development tools and infrastructure is boosting innovation, and adequate bandwidth is diminishing latency to near real-time.outsourcing6

What is the Human Cloud?
Adding the human element to the Cloud has created the Human Cloud, which can be loosely defined as a self-organizing ecosystem that engages a pool of digital workers for a wide variety of on demand and ad hoc services. The Human Cloud is providing a definitive answer to the challenge of analyzing large swathes of data by harnessing the power of distributed computing and the problem solving capacity of an array of human brains. This is providing hitherto unattainable flexibility, cost saving, speed of execution and transparency, all instrumental in an age of ubiquitous business where immediacy is the first and most important metric and expediency trumps accuracy. In conjunction with Cloud Infrastructure, the Human Cloud is making location irrelevant and virtualization of work a reality.

Business process as a Service (BPaaS) is delivered via a Cloud-based platform using a combination of process automation and dedicated labor for a client. The pricing models are usually consumption or subscription based. Crowdsourcing is the practice of obtaining business process services, creative services, content or data management services by soliciting contributions from a large and distributed group of independent workers, rather than from traditional employees or suppliers. The pricing model is usually task-oriented and output-based. Combining the two creates a potent combination of a largely scalable and partially automated alternative service model that is throwing up new opportunities as well as challenges – the Human Cloud. The Human Cloud is essentially an augmented intelligence ecosystem, almost a symbiotic form of self-correcting and persisting service delivery fabric.

Traditional BPO firms are process-oriented companies and specialize in understanding client processes, transition them to their own centers, optimize them and deliver services on an ongoing basis with predictable costs, quality and reliability. The processes typically suited for such a delivery model are finance and accounting, HR, procurement, supply chain management etc. BPaaS has largely embraced these same service areas and offered additional efficiencies and cost savings.
Is this the Future?

With ever-growing digital content, a new service line has emerged which requires a new breed of services providers that can leverage Technology, BPaaS and the Human Cloud. All of this sounds very exciting but is the future of BPO the Human Cloud? Our answer would be a yes and a no.

The Human Cloud, backed by the Infrastructure Cloud, will at best be an alternative to outsourcing certain task oriented activities that are very repeatable and easily dis-aggregated. This is well suited to services where there is a fluctuating and cyclical demand (ie unpredictable and asynchronous work load), or projects that are output-based or require diverse skill sets such as multilingual capabilities etc. Traditional outsourcing of business functions such as finance and accounting, HR etc. will still require a traditional or BPaaS-based delivery model with structured processes, adequate data security and a stable or dedicated workforce.

Some of the biggest advantages of the Human Cloud are standardized processes, labor on demand, diverse skill sets and low investment from clients. This growing wave of outsourcing is creating waves in the outsourcing world and opening new vistas of opportunities for buyers as well as suppliers. The Human Cloud has the potential to change the global labor market.

Advantages of Human Cloud
Low Cost

The cost saving is attributed to low wages, lack of benefits, absence of facilities or support costs, and low administrative and overhead costs, no training, supervision or turnover costs.

Scalability and on-demand labor
The human cloud is typically not constrained by capacity, location or time zone as a traditional BPO would. Labor is virtually on demand.
Managed Crowd Sourcing

Intermediaries and third parties acting as brokers to service can provide a governance layer and ensure quality and data security
Standardized processes

The cost of optimizing processes is hugely reduced as the model follows standardized processes which are already optimized
Higher Social Impact

The concept of micro work and engaging human capital from the socially vulnerable sections of the society is one of the spillover benefits of the Human Cloud
Operating Models and Impact

The evolving nature of the Human Cloud has seen various operating models with each having its own risks and rewards. The Facilitator model has been able to reduce the risk of anonymity by providing information on their staff. This model pioneered by online freelancing services such as Elance, Guru and oDesk were the first generation Crowdsourcing plays. However this was largely a freelance staffing model with limited process capabilities, moderate scalability and no project management.

This approach has been successful for jobs requiring flexible resources with repeatable tasks such editorial, data cleansing projects etc. The Arbitrator model provides buyers with on-demand access to a specialized community of skilled suppliers who can be engaged on a project via a competition or contest. The buyer can choose from multiple units and pay only for the one it finds most valuable. CrowdSpring and CrowdFlower are examples of this model.

The Aggregator model is one of the most commonly followed models in the Human Cloud. This model is suitable for large repetitive work. This model provides a platform and infrastructure to run the project. Amazon Mechanical Turk, Clickworker, Microtask are good examples. They have also started providing governance and quality control as part of the offering. The Governor model combines human skills with process frameworks and a technology platform to deliver, monitor and evaluate modular tasks. They provide a layer of project management, Business Analyst roles and work towards breaking up and distributing work followed by quality checks. Some of the firms using this model are TopCoder and Samasource.
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Challenges to be Overcome
While the Human Cloud is gathering momentum and redefining the global labor markets, it has its own set of challenges. It still is an evolving model and has inherent risks as providers are tweaking their technologies, processes and management capabilities. The “human” part of the cloud is still not as predictable and efficient as a structured BPO worker typically would be. The evolving nature of this industry and its dynamic behavior are both its strength and weakness.
In a Human Cloud environment, each task or activity needs to be defined each time they need to get it processed. The managed Crowd-sourcing model is trying to address this issue. The Human Cloud has yet to take off and become a mainstream play. Similarly BPaaS in its early years required a strong change in mindset to gain adoption. BPaaS required both a high level of process maturity and readiness to adopt standard processes.

Some of the most commonly outsourced work in the human cloud sphere is task or project based and includes content generation, digitization, map tagging, social media monitoring, sales and marketing support, research and development, document translation services, business analytics and data management. Some of the recent highlights in this area have been Nokia’s Ideas Project focused on consumer-derived collaboration across 210 nations to improve the viability of their products in all markets by drawing on consumer-experiences of participant-innovators to generate new ideas.

Facebook has also used the Human Cloud to create different language versions of its site, which are more compatible with local cultures, while it is common knowledge that Google and Yahoo use this to tag their maps and provide location based content. uses it extensively for digitization and indexing of genealogical records.

A Robotic Future
Adding to this mix is a new wave of innovation driven through Robotic Process Automation (RPA). RPA refers to automation of functions where computer software drives, follows and completes operating processes in the same way that a human user would. RPA is a tool or platform that operates and controls other application software through the existing application’s user interface as a human agent would do. It has been estimated that building a virtual back office with robotic “agents” to complete rules-based processes would cost almost a third of an offshore agent.

Of course, it’s a given that RPA would maximize productivity (robots can work 24/7!) and always perform with 100% accuracy. Understandably, not all processes can be automated but RPA is definitely gathering attention of service providers that are keen to differentiate and offer more innovative solutions to their clients. A common and simple example of RPA is the intelligent IVR that is being deployed to manage inbound calls and replacing human CSRs. One of the emerging RPA companies is Blue Prism which currently has some 1,000 virtual robots performing about 150 processes for a roster of 30 clients.

The Human Cloud and the Cloud infrastructure are defining a new alternative to the traditional BPO services in various key segments of work. It is fast changing the dynamics of how the BPO industry has been operating. Mature functions such as FAO, HRO etc. that require deeper understanding of the institutional knowledge, relatively stable workforce and governance from a service provider will continue to remain in the realm of traditional BPO or BPaaS.

However, new and emerging service offerings in the realm of Digital and Content management will shift to the Human Cloud. Traditional service providers, in order to differentiate, compete with smaller, nimbler players and avoid the commoditization penalty, will need to invest in this transformative model. Buyers would need to think differently and re-organize their service strategies to be able to benefit from this new paradigm. The Human cloud services are only going to grow more sophisticated and will become a significant subset of the BPO industry and change the way the current industry operates.

Telstra’s second shot at cloud

April 7th, 2014

While it might be Australia’s largest telco, Telstra alone cannot compete on cloud computing prices and features when up against the scale of Amazon, Google or Microsoft.outsourcing41

On that basis, Telstra’s new deal with Cisco Systems looks to be prudent.

Under the deal, Cisco Systems will build and operate a cloud computing service inside Telstra’s Australian data centres that is based on Cisco hardware (servers, network) and Red Hat’s supported version of the OpenStack cloud computing framework (albeit with a few minor alterations by Cisco).

These racks will form a node in a global cloud Cisco operates with other telco partners across the globe – what the Californian company brands ‘The Intercloud’.

Just about everything in the stack is built and managed by Cisco – all features, functions, patches – despite it residing in Telstra’s data centre. Telstra concerns itself with network routes in and out of the data centre, customer support and billing.

It has big implications for Telstra’s IT staff, many of whom were laid off in a recent outsourcing drive, and even bigger implications for existing customers of Telstra’s Cloud Services.

Economies of scale

Erez Yarkoni [pictured], former T-Mobile CIO and now Telstra’s director of cloud services, spent time with me late last week to explain his strategy.

Yarkoni arrived at Telstra in November 2013 – his immediate concern being how the telco could achieve scale from its cloud computing investments.

Telstra’s initial foray into cloud computing – initially dubbed ‘Network Computing Services’ and later ‘Telstra Cloud Services’, was powered by the telco’s investment in hardware from EMC and Cisco, software licenses from VMware and BMC and an application migration and integration partnership with Accenture.

Several other Australian service providers – notably Alphawest, Bulletproof and Melbourne IT – had also built Infrastructure-as-a-service plays on the back of VMware’s hypervisor.

But at least two out of the three have since abandoned these projects as they struggled to compete with the global scale of Amazon Web Services, Google, Microsoft and others. The price war between AWS, Azure and Google in particular has rendered the most aggressive cost models from domestic suppliers uncompetitive to the point where there is more money to be made reselling and managing services hosted on some of these services than attempting to compete head on.

Yarkoni told iTnews he landed on the Cisco deal after a global technology tour that encompassed visits with most of the major players including HP, Microsoft and VMware. His discussions encompassed technology roadmaps but also “cloud economics”.

“Infrastructure is a global scale game,” he told iTnews. “And what defines the infrastructure is the software that brings it all together. I could try and compete by hiring 2000 developers in Seattle as Amazon and Microsoft has, or I could embrace open source and do it myself. But to do it yourself – to build your own set of software development resources – you are quickly going to find yourself unable to compete with global infrastructure.”

Yarkoni’s theory is that customers are likely to want to operate in a hybrid state.

“I’m of the same opinion as many Telstra customers – they will want to have more than one cloud infrastructure in play. The world will be a hybrid world. We will concentrate on building the service-managed infrastructure – such that we could, if required, attach Amazon Web Services or any other API-compliant cloud underneath.

“It’s important to understand what cloud economics mean,” Yarkoni said. “IaaS is a lean margin, global service. We need to graduate to building value on top of that infrastructure.”

Cisco’s Intercloud is built on technology the vendor already uses to manage its own WebEx Squared workloads, among others, allowing for a fairly aggressive roadmap.

Telstra already has racks being installed running the Intercloud software – specifically Red Hat’s version of OpenStack with Cisco’s management layer running over the top.

The next job is for Cisco and Telstra to build the necessary layers for the service to be commercially multi-tenant. By late May and early June, Yarkoni hopes to offer a platform in Alpha state, with customers being asked to “run  some workloads and hammer the alpha environment” for stability while Telstra builds the billing interfaces to sit atop it.

In the latter part of 2014 Telstra will offer a beta service to customers for dev and test use, with the billing service now live, with full production ready before the close of the year.

Yarkoni agrees that its an aggressive timeline, but counts on Cisco and Red Hat to bring the necessary skills to the table to get the job done in a timely fashion.

I asked him if there were enough skills around OpenStack in Australia to do the job.

“That’s a great question,” he said. “Our aim is to build this with Australian hands, provide Australian support but use global R&D. I believe we will find the skills, if not [our partners] will import them.”

What does it mean for existing customers?

While the final deal is yet to be inked, its expected Telstra will have Cisco’s Intercloud exclusively in Australia for somewhere between one to two years.

Initially, Telstra intends to continue to offer its existing VMware-based ‘Cloud Services’ stack to customers as Intercloud builds up momentum. Yarkoni wasn’t keen to commit to its future development.

“We will respect all existing contracts, and support the features and functions of the last version [CSX],” he said. “And we’ll continue to actively sell it to customers that require dedicated hosting but want to run it on utility infrastructure.

“Over time, what I expect to be a journey of a couple of years, customers will either choose to – or we will help them – migrate to OpenStack with KVM or even with VMware if you have to. We’ll have all sorts of other flavours of cloud underneath.”

Yarkoni agrees that supporting multiple hypervisors or cloud architectures comes at a cost to Telstra. The beauty of OpenStack is that Telstra – and in turn its customers – will be able to choose whether or not to pay VMware’s software licensing fees or use a freely available option. Yarkoni said that if Telstra gets the service management layer right, what sits beneath will be less of an issue.

“If you walk into an Amazon data centre, you will find different versions of what Amazon considered their standard compute over time. But it all still works. Similarly, at some point, Apple decided to put Intel chips in laptops. It didn’t especially matter that you used a MacBook or a MacBook Pro, or that your computer came with one chip or another. Apple decided the economies of scale using Intel chips was better than designing their own.”

For that reason, cloud services built on Cisco’s Intercloud are likely to be branded ‘Telstra Cloud Services’ just as existing services are today.

A new service, and a new customer proposition

Yarkoni hopes that the Intercloud deal will bring about one key architectural difference between existing Telstra cloud services and those that will be on offer by the end of the year.

“Today, the elasticity we call ‘cloud’ exists only up to the edge of the data centre,” he said. “Where it needs to work is all the way to the edgepoint device where a customer consumes a service.

“What we have had to do in the past is to build a service layer that allowed us to address firewalling, routing, VPN, private networks, service instantiation, and all the move adds, and changes associated with those network issues. What we intend to build now is a service that automates this all the way to the customer.”

Telstra is also looking to incorporate network APIs (application programming interfaces) that allow a customer’s application hosted on the Telstra cloud to adjust the size and quality of the network pipe required.

“It would be ideal to say to customers: for certain apps, you no longer have to plan to a peak network capacity. You can have the app ask for capacity on the go. Or you can schedule a batch job to only run during off-peak rates.”

The Intercloud deal will – if customers subscribe at scale – elevate Telstra as a service management and IT operations channel.

“If we have the tools, and the people with a DevOps mindset, we can drive better economies of scale and operational excellence,” Yarkoni said. “We can bring the promise and elasticity of cloud without Telstra or the customer needing to over-invest in capital or planning for peaks.

“Then we can graduate conversations with our customers – how do you deliver that to my applications, the IT that supports my business? Sometimes that is a SaaS conversation, other times it is about bringing elasticity to the application – we pre-configure the infrastructure such that it becomes the click of a button in a catalogue.”


Cloud, mobility might eliminate need for infra and ADM outsourcing: Samiron Ghoshal

March 28th, 2014

Almost every IT service provider is rushing to be part of the ‘digital transformation’ within the clients as they focus on the social, mobility, analytics and cloud (SMAC) suite of technologies.Outsourcing27

Samiron Ghoshal, partner and leader (IT advisory services) at Ernst & Young, talks to Bibhu Ranjan Mishra about the shift that is happening in the market place and how well-positioned the Indian IT services providers are. Excerpts:

Most service providers have been aggressive on SMAC, showing this is the way to go forward. Have Indian enterprises started embracing digital transformation and SMAC?

To be honest, there are various parts to it. In technology, we have terms called ‘leading edge’ and ‘bleeding edge’ technologies. Typically, if you look at the spent pattern and size in an emerging market, people probably don’t spend money that easily on bleeding-edge technologies unlike in developed markets.

However, there are exceptions. In the Indian context, we are seeing players in areas such as financial services and healthcare adopting cloud and mobility solutions quite faster.

Do you agree with the perception that cloud and mobility restrict service providers’ ability to offshore is low and the deal sizes are small?

Offshore comes into the picture wherever there are building blocks in the technology space which can be done out of sight. Typically, in any leading edge area, the technology lifecycle gets shorter.

Secondly, a clear demarcation of blocks which can be offshored is difficult. If you have to make a mobility solution which does not have the past and future, and you have to design and build it from the scratch, it becomes difficult to offshore.

Where does the Indian players stand in this whole game?

In our IT industry, ADM (application development and maintenance) and infrastructure services account for 80-85 per cent of the overall work. So we are still playing in that nuts and bolts area. With cloud and mobility, that whole model is going to change.

For the Indian players to move up the value chain in the whole pyramid, they need to be there right from the beginning instead of waiting for the SAPs, Googles, Oracles and Amazons of the world to create the model and then look for offshorable elements after five years. It, in fact, requires a significant amount of investments in terms of people, process and skills.

What is this model?

The biggest change that is happening today in the technology spend area globally is the empowerment of the business users to make decisions, bypassing the CTO (chief technology officer). Tomorrow, with cloud and mobility, applications are going to be available on a subscription basis – the way you buy electricity.

That means, a lot of these apps will be front-end enabled where employees will buy their apps. So, the play is changing. Tomorrow, there may be so big infrastructure or apps to maintain. This would put a big question mark on the future of the IT players who just focus on the bottom of the demand pyramid.

Most Indian IT players believe the demand for offshore IT services is bouncing back. Is it so?

Demand is bouncing back in the medium term. There is also pent-up demand since many of the Fortune 1000 companies in the developed markets did not spend that much during the last five years, because of bad times. This will be there at least for the next five to seven years.

But there is certainly a change. Before Y2K, IT was just about body shopping. After Y2K, the world proved that offshoring-based development and maintenance can be successfully done. That is when Indian companies took off. The next phase is starting. If somebody does not align to it, you don’t know what the shape will be after five years.


Cloud Adoption and Managed Service Providers Fuel Global Momentum for IBM PureSystems

February 3rd, 2014

As organizations look to consolidate their existing data centers and shift more of their workloads to thecloud, IBM (NYSE: IBM)  announced that this trend has helped fuel the growing momentum for the IBM PureSystems family of expert integrated systems, which have now shipped more than 10,000 units through the 4th Quarter of 2013.


Another aspect of this trend is that as more organizations embrace cloud computing, they are looking to Managed Service Providers (MSPs) to help them quickly develop and deploy cloud based services in a more secure and economical way. These MSPs – many in key regions such as India, Brazil and China – are increasingly turning to IBM PureSystems over other vendors’ offerings in order to transform their data centers and provide the IT infrastructure that meets the needs of their clients.

Global Clients Embrace PureSystems

ABC Capital, one of the largest financial companies in Mexico, faced a difficult server consolidation project. After considering other vendors including HP, Dell and Oracle, ABC Capital chose to consolidate its entire IT infrastructure onto IBM PureFlex.

“In order to become more competitive in the market, ABC Capital was looking to build an infrastructure that could support the mobile technology and social network requirements of our customers,” said Sergio Mendoza Alvarez, Director of Technology for ABC Capital. “The integration of our platforms using IBM PureFlex will allow us to meet these goals and reduce the migration time for our multi-core systems, from two years to seven months.”

The flexibility and ease of deployment that PureSystems delivers has been one of the key reasons for the rapid adoption by organizations like ABC Capital in a wide variety of global regions.  For example:

·   FleetRisk Advisors, a business unit of Omnitracs Inc., provides advanced analytics solutions for fleet management and logistics. With a solution that includes IBM PureData System for Analytics, FleetRisk Advisors built a cloud-based, software-as-a-service (SaaS) platform that enabled it to help reduce fleet-related accidents by 20 percent and support a 200 percent growth in the number of clients it serves.


  • India’s Pvt Ltd, a leading Knowledge Process Outsourcing (KPO) provider, which co-designs highly targeted knowledge solutions and operates global knowledge centers located in Chile, China, India, and Romania, has chosen IBM PureFlex to enable an IT infrastructure that supports a private cloud environment and virtual desktop infrastructure for nearly 2,000 users. IBM worked with its business partners Avnet EM Asia and Tech9labs on this project.
  • India’s Karunya University has selected IBM PureFlex to improve online student services by more effectively processing applications, such as handling online enrolment, exam scheduling, virtual campus management, and more.
  • eWell Technologies (HangZhou) Co., Ltd., an independent software vendor (ISV), needed to develop a hospital-based information integration platform for its master patient index solution. With the PureApplication System, eWell can now offer its customers a standardized platform to better monitor both inpatient hospitalization and outpatient services. eWell is partnering with IBM on Hospital2.0, a revolutionary plan to expand the Chinese healthcare industry ecosystem.
  • TCL Multimedia Technology Holdings Limited, ranking among the world’s top 3 leading Television producers by revenue, has chosen an IBM PureSystems solution over Oracle EXADATA, Huawei Cloud center, EMC and Dell.  The company will use PureSystems to better manage its big data challenges and gain stronger insights into their business, helping TCL streamline business processes, increase profitability and support growth and innovation.
  • Fortnox, a provider of Internet-based applications in Sweden was able to reduce IT costs by as much as 50 percent, enhance service availability and flexibility, accommodate business growth and minimize staffing requirements utilizing an infrastructure built on IBM PureSystems.
  • Japan’s Taiho Pharmaceutical Co., Ltd utilized IBM Flex System to develop a desktop cloud platform for the tablet PCs used by more than 700 members of the company.

Ecosystem of Partners Key for PureSystems Adoption

For IBM Business Partners, PureSystems creates a new opportunity to help clients solve the complexity of enterprise IT, reduce costs and encourage innovation. From resellers to distributors and ISVs, more than 2,200 Business Partners are supporting IBM PureSystems, while more than 370 ISVs have created application patterns and virtual appliances that can be downloaded for PureSystems. This includes leading solutions from some of the world’s largest ISVs, from ERP systems to applications for the banking, marketing, healthcare and energy industries.

A Family of PureSystems to fit Client’s Needs

The IBM PureSystems portfolio offers clients an alternative to current enterprise computing models, where multiple and disparate systems require significant resources to set up and maintain. The entire portfolio is configured to make cloud computing easy for clients and includes:


  • Flex System provides the building-block elements for clients who want to custom build and tune configurations to their specific requirements.
  • PureFlex System, which provides a preconfigured hardware system and enables organizations to more efficiently create and manage an infrastructure.
  • PureApplication System, which integrates pre-configured software and industry patterns to help organizations reduce the cost and complexity of rapidly deploying and managing applications.
  • PureData System models, which are optimized for delivering data services to today’s demanding applications with simplicity, speed and lower cost.


The benefits of cloud computing for small businesses

February 3rd, 2014

If you are running a small to medium sized business, you will have probably heard of cloud computing.

Cloud computing means moving or extending your business IT systems over the internet, in order to increase the current capabilities, and improve efficiency.

More than just a passing trend, cloud computing has a large number of benefits if you want to manage your IT processes more smoothly, reduce your costs, and safeguard your business against unforeseen disasters.


Here are some of the advantages of using cloud computing technologies:

Time saving

Cloud computing is a time efficient way for small businesses to manage IT. With cloud technologies, you can keep track of what is happening with your business from anywhere, at any time. You can hold virtual meetings, and manage remote employees. Small businesses are increasingly turning to outsourcing to expand their business operations, and keep their costs down.

Cloud computing allows outsourced and remote employees to share files, collaborate on projects and maintain close contact, which can improve team efficiency and help team members work together more effectively. This means more time to spend working on your core business activities, and less time spent managing logistics and dealing with staff IT issues.

Cost effective

With cloud computing, businesses can save on the costs of purchasing (little capital outlay) and maintaining servers, having dedicated IT staff on the payroll, and upgrading software. It’s also a way of accessing the most up-to-date software and applications, programs that you might put off installing due to the cost. The other major benefit of cloud computing is that it is scalable.

If you need additional resources to cope with a busy period or sudden growth, these are available and can be accessed as required without the need to upgrade your entire system in order to cope with the additionalworkload. Accessing cloud services simply requires a stable internet connection, and a monthly subscription.

Speed and convenience

Because working in the cloud means accessing applications via a web browser, it’s easy and fast to set up. There’s also generally no need for detailed training for your employees.

Data storage

One of the most advantageous aspects of cloud computing is its capacity for large amounts of offsite data storage and file backups. Work can be instantly backed up to offsite servers, which means that if there is a technical failure or other problem at your business premises, valuable data is still accessible. Using the cloud can also mean having a greater level of security for your data, depending on your current security system.

Cloud computing has many benefits for all businesses, but it can be particularly beneficial for small and medium sized businesses. Using the cloud can save you time and money, and give you the advantages of increased data security and the ability to scale your IT services up and down depending on your current circumstances.


Is cloud computing almost too good to be true for banks?

January 7th, 2014

Banks are built on massive IT infrastructures that process huge volumes of data on a daily basis. The cloud’s most obvious benefits will enable banks to keep up with technology changes while reducing costs.outsourcing26

The digitisation of services is making it difficult for banks to ignore the cloud.

But concerns over a potential loss of control, availability and data security make moving to the cloud a massive leap in a heavily regulated sector.

At a recent meeting at the Financial Services Club (FS Club), Chris Skinner, chairman at the club, said the cloud is still misunderstood, despite it being a talking point in financial services for years. In 2009 the FS Club hosted a meeting about the cloud in financial services and 165 people attended.

“Cloud computing in financial services has been a hot topic for some time and you would think we would know what cloud is all about but we don’t,” said Skinner. “We still have a lot of misunderstandings and ambiguities.”

Legal aspects
Paul Hinton, commercial technology partner at Kemp Little, talked about the cloud in the legal sense.

He said the cloud is diverse and constantly evolving. No sooner do legal terms get to grips with one aspect and they must move on to the latest cloud trend. “SaaS is so commonplace we now understand how to do it and what it should look like from a legal perspective. But the cloud is much more than this.”

Utility computing is the next phase for the cloud with services being bought in a similar way to electricity, according to Hinton. “But banking and the things we buy through banking, from what I understand, are nowhere near that stage yet.”

There are lots of different pieces of legislation that can apply to the cloud, but there is nothing specifically about the cloud, said Hinton. “From a legal point of view the same rules apply to cloud outsourcing as outsourcing.”

He said there are common concerns among businesses. “These are potential loss of control, availability and access to data, data security, data location, auditing and exits.”

“There are a lot of efforts to create [legal] standards and hopefully we will have them soon. This is good but they are not here now and may not be for a while,” added Hinton.

A spokesperson at a major cloud service provider then talked about what it is doing in financial services.

He said there is a lot of ambiguity around the cloud but summed up what it meant to his company.

There is no reason why today banks should not be using the cloud in some way
“A cloud service should be something available over the internet, no up-front costs, pay as you go and with no long-term commitment.”

There is no reason why today banks should not be using the cloud in some way, he said.

“I do not see a huge difference in how financial services companies adopt the cloud they just have a different approach.”

He said when it comes to highly regulated services with customer data it takes a long time to move to the cloud. But he said there are many areas finance firms can start using the cloud easily.

“We look for the low-hanging fruit, not the most sensitive data. Finance firms can start to benefit from features, such as development and testing, because they don’t host sensitive data.”

“High-performance computing is another option because it normally involves systems that encrypt data. This means results can be delivered quicker,” said the spokesperson.

He added that developing new services can be done in the cloud faster and more cost effectively because the cost of failure of a new service is reduced. “With new lines of business you can test it out and if it doesn’t work you turn it off and there are no assets costing money.”

He said that the suppliers can become compliant with regulations so every company using it is also compliant, when using it.

The next speaker was from a large payments processing firm. He said maintaining trust and delivery to customers is vital.

He said customers expect their money when and where they chose.

“If you are running retail financial services you have to put the customer first. The customers get the cloud and they have certain expectations for service delivery,” he said.

He agreed that the cloud enables effective development alongside cost cutting.

“The cloud is a huge layer of facilitation for new services. Banks also need to manage costs more effectively, the cloud is faster to implement and cheaper so what is there to hate about it?” said the spokesperson.

The next speaker was from a small next-generation cloud-only financial services firm.

The company is a totally cloud-based financial service. It has taken a small piece of the banking chain, in this case international payments, and put the entire process on a cloud platform to offer to banks.

The cloud is just another form of outsourcing
New customers, which are financial services firms, only take two weeks to set up.

“We take a huge amount of cost out of the process,” said the spokesperson.

The company makes 10,000 transactions per day. “Using the cloud is no different from outsourcing. Offshore companies in India have customer data and there is uncertainty about security.”

He said there is still a “not invented here” attitude holding cloud uptake back. “Technology departments at banks want to build their own systems. It is not a rational debate but an emotional one. Some of these IT departments do not even use Agile methods and still use Waterfall techniques.”

He said you have to get these people to accept change and not fear the worst.

Former Accenture executive, Jim Odell, now a consultant at Kemp Little, then talked about hybrid IT departments and how organisations have to have a mix of in-house and outsourced IT.

“The cloud is just another form of outsourcing,” he said.

His advice to finance firms considering the cloud was: never outsource things that are not already fixed, make sure you know how to manage suppliers, don’t put everything in the cloud it can be expensive, and plan to leave when you sign a now contract.


More and more jobs are in analytics, big data & cloud

December 26th, 2013

Looking for a job in the IT sector? Consider big data, analytics and cloud computing – hot areas that IT companies may recruit people for in 2014, say HR experts.

There is a growing demand of skills on big data and analytics mixed with business and management education. Consulting firm McKinsey estimates that India would need two lakh data scientists in the next few years.Outsourcing28

Data explosion

Analytics professionals and data scientists will be most sought after as digital data is growing exponentially. The rate of explosion of data from India will be double that of the world average in coming years.

With the rising popularity of big data, firms are banking on analytics professionals and data scientists to create a competitive edge, said Moorthy K. Uppaluri, CEO, Randstad India.

Cloud computing, big data and analytics will be the hot areas as these are the one’s that directly brings the revenue for the organisations, said Sunil Goel, Managing Director, GlobalHunt, an executive search company. India will remain the preferred destination for analytics outsourcing compared with the Philippines and China. Unlike BPOs, analytics requires are not easily available in those countries. India’s analytics talent pool will be in high demand because of their process expertise and English language proficiency, according to Gaurav Vohra, CEO, Jigsaw Academy, an online analytics training academy.

Salaries in the analytics industry have been increasing faster than the average for the last 10 years. This trend will continue in 2014 as well.

Entry level salaries will grow by 5-0 per cent and for those with five years of experience, it will grow by 10-15 per cent.

Entry level salary

The entry level annual salary for data analytics professional is Rs 6-9 lakh while it is Rs 5-8 lakh for big data professionals. These could be higher depending on experience and skills, the academy said.

Online job portals like and too feel that data analytics and cloud computing will be the top picks in 2014.

While big data and analytics have been talked about extensively in the past one year, an area that will see high traction will be data analytics, data security and safety, said V. Suresh, Executive Vice-President and National Head of Sales,

India is poised to surpass US in terms of number of Internet users and with a rapid penetration of mobile devices, we can expect huge demand in the sectors such as Internet, mobile application development, social and digital media experts, he said.

Many companies are adopting cloud to achieve operational efficiencies. This paves way for appropriate security, enterprise and infrastructure architect to ensure a secured computing environment, said Uday Sodhi, CEO,

Top picks

Many businesses thrive on data and the demand for IT professionals specialising in data sciences will grow. Extracting knowledge and valuable insights from data requires knowledge of variety of fields, including mathematics, statistics, data engineering, pattern recognition and learning, advanced computing, visualisation, uncertainty modelling, data warehousing, and high performance computing with the goal of extracting meaning from data and creating data products, he said.

Solutions architects, chief technology officers and program managers will be top picks in 2014, According to E. Balaji, a HR consultant.

Solution architects play the bridge role between customers and developers. CTOs will be key ally to the CEOs. They need to have a strong appreciation of customer behaviour and devise appropriate strategies to address segments effectively. Program Managers with prior experience in running huge programs will be in great demand, he said.


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