Posts Tagged ‘Cloud’

SOS to Indian enterprises: SMAC IT to them!

October 13th, 2014

At the India edition last week, of EMC Forum — the annual tech conference and showcase of the global leader in IT storage hardware and Big Data solutions — the Cloud loomed large, hovering over almost everything that was discussed. Indeed Social (media), Mobile Analytics and Cloud ( SMAC) was seen as the winning combo for Indian enterprises.Outsourcing17

Vishnu Anand spoke to two EMC experts for their take on what cloud strategy might be a best fit for India.

‘Hybrid cloud is a strategy, not a product’

CIOs across the globe have started to adopt hybrid cloud technologies to optimize cost and modify their IT and computing backbone with rapidly changing business needs and increased consumer demands. But it is also essential to make hybrid cloud technologies a part of your business strategy, not just a product that you deploy.

Christoph Thelsinger, VP, Systems Engineering, Asia Pacific & Japan, EMC says: “Most organizations in Asia approach us with one common challenge – having to meet consumer demands swiftly to ensure business agility. We always advice them to embrace hybrid cloud as a broad strategy, and not just a product.”

Thelsinger’s reasoning is that organizations that have already virtualised their systems, and are already operating in a cloud environment, experience the ‘burst’ scenario where there is a sudden – sometimes seasonal — need for compute power for a short span of time. After this time has elapsed, it is business as usual. “Since you cannot predict when the burst is going to occur, it makes sense to invoke compute power as and when you need it. This provides you the agility of a public cloud and the security of a private cloud”, he says. In such a scenario, the IT organization can take back control whenever it decides to.

Organizations that have explored the hybrid cloud are increasingly open to putting critical data on public cloud and accessing them on-demand. “The as-a-service model has a cost benefit to it. It may not be a decision initiated by the IT team. There is a definite cost advantage in putting your core ERP on the cloud, or even extending your data centre to the cloud. This cost consideration, in the days to come, will drive the market towards hybrid clouds”, suggests Thelsinger.

‘Nobody understands Cloud-as-a-Service better than India’

The concept of Cloud-as-a-Service, where organizations — big or small — can invoke computing power as and when they need it, dial-in/dial-out whenever business demands, is catching up in India and Japan. EMC, the global storage, virtualization and cloud services provider has identified a unique characteristic of India that makes it conducive to embrace and use cloud technologies at a greater pace than rest of the world.

David Webster, President, APAC & Japan said: “The IT ecosystem in India has grown up on the concept of outsourcing, and outsourcing is all about sub-contracting your IT operations to a third party and focusing on your core business. The guiding principle of Cloud-as-a-service is very similar to outsourcing, and this is precisely why India is today at the forefront of adopting new Cloud technologies.”

Webster went on to explain that the new-age consumer demands the same level of computing of an advanced laptop or a desktop, in a mobile smartphone. “With 81% of the country’s population using mobile devices, more and more Indians are using their personal mobile phones for official work, including business critical operations like secure bank transactions, stock market monitoring, and even managing their office ERP systems.”

He however cautions: “In order to woo the new-age Indian mobile consumer, organizations and service providers need to pull up their socks and create a smooth and uninterrupted computing that is cross-platform and device agnostic.”

Explaining how the SMAC ideology is a ‘best fit’ for India, Webster said, “The mobile is in more ways than one a ‘third platform’ in computing. The mainframes defined the first platform, while the PC and client/server architecture defined the second platform. EMC believes that the third platform is all about mobile interspersed with Big Data, analytics, Cloud and social business. And India will have a huge role to play”.


Gov ‘cloud-first’ policy has clear gaps

October 9th, 2014

THE Abbott government’s so-called ‘cloud first’ policy lacks a clear plan or specific goals, say industry experts, who fear it will be a pipe dream without strong leadership.Outsourcing4

The government yesterday released a long-awaited update to its cloud computing strategy, saying departments and agencies are required to consider cloud first where it is fit for purpose, provides adequate protection of government data and delivers value for money.

The announcement follows a recommendation by the Commission of Audit for the government to adopt a cloud-first approach for ICT procurement.

Agency heads would be able to approve proposals to place “certain information” either onshore or offshore, a joint statement by the ministers of finance and communications, and the Attorney-General said.

The government spends $6 billion per annum on ICT but only a fraction on cloud services — $6.2 million since July 2010, including $1.5m on data centre-as-a-service contracts.

OzHub chair Matt Healy said the policy showed intent, but lacked targets and strong central leadership.

OzHub comprises industry players such as Macquarie Telecom, Infoplex, Alcatel-Lucent and F5 Networks.

Mr Healy said the British government had a goal of shifting 50 per cent of its new government IT spending to cloud-based services by 2015 but Australia had no such target and spent too little on cloud services.

“Industry is ready but the government must set real targets,’’ he said in a statement. “We’ve been in the starter’s hands in the race for take-up of cloud computing for too long.”

Mr Healy said the Attorney-General’s updated information security management guidelines could hamper cloud adoption since agencies were authorised to conduct their own risk assessments and approve the outsourcing of government-held private information offshore.

“There is an increased risk associated with data held offshore, and surveys showing that consumers and small-to-medium-sized businesses are more concerned about the security of their personal information when held offshore,’’ he said.

“Devolving decision-making to individual agencies on the basis of ‘streamlining decision making’ may not constitute an appropriate privacy and security regime to protect the private information of Australians.

“We believe there should be a sensible balance of prudent accountability by the Attorney-General and central agencies in providing assurance to Australians that their information is safe and that redress in Australia is available should there be a breach,” Mr Healy said.


Pharma Outsourcing Driving Need for Cloud-Based Services

September 30th, 2014

As demand shifts from high-margin branded drugs in Western regions to low-margin generics in emerging markets, successful bio/pharmaceutical companies are adopting new business models that include significantly more outsourcing and require a deeper understanding of costs all along the value chain. Enterprise resource planning (ERP) systems that have been effective for the internal management of sourcing and production are insufficient for managing the extended relationships and multidirectional communications needed in this new environment. Bio/pharmaceutical companies are therefore turning to cloud-based services to achieve greater transparency and facilitate collaboration.Outsourcing38

Outsourcing trend
The biggest trend driving changes in the market today is the shift from a focus on Western markets to growth areas in emerging regions, according to Diane Palmquist, vice president of product management for GT Nexus, a cloud supply-chain platform provider. “High-margin blockbuster drugs are coming off-patent and mature Western markets are experiencing limited growth. Consequently, the focus has shifted to emerging markets, where the growth rate is higher. However, the demand in these regions is greatest for low-cost, low-margin products, and buying habits are very different (buy the dose, not the bottle),” she observes. The result: bio/pharmaceutical companies need to completely transform their old business models.

The biggest impact can be seen in the higher level of outsourcing now taking place. “Pharmaceutical companies are outsourcing nearly every aspect of the business, including some research-related activities, API manufacturing, drug product formulation, packaging, and logistics,” says K.R. Karu, industry solution director for Sparta Systems, a provider of enterprise quality management solutions. Palmquist adds that currently approximately 40% of industry business is outsourced, and that number is expected to increase to 80% over the next several years.

Loss of control
As outsourcing has increased, companies have lost control over many aspects of the supply chain. “Companies are still trying to manage interactions with suppliers and service providers through personal communications, which is not only inefficient, but ineffective given the number and complexity of relationships and issues that must be managed,” Karu says. The low margins of today also do not support this approach. ERP systems, which in the past have been used to connect purchasing with production operations, are also not capable of managing the complex interactions between service providers and pharmaceutical companies, according to Palmquist. Furthermore, to meet the demand of emerging markets, pharmaceutical companies must be very responsive and need solutions quickly. ERP systems generally take about 18 months to get up and running, and often by that time the opportunity has been lost.

One of the key issues for bio/pharmaceutical companies is the lack of visibility into contract manufacturers. Often pharma companies do not find out about issues that can impact the delivery of API or finished drug product until much later because the suppliers are trying to solve the problem. The common response, according to Palmquist, is to try and stay on top of potential problems by constantly contacting the suppliers via phone or e-mail, which is not a practical, sustainable, or effective approach.

“The challenge lies in the need to manage a whole host of different suppliers at the same time that the customer base is changing dramatically and bringing an entirely new set of customer expectations. The key to this puzzle is to obtain visibility on both the supply side and the value side, from inventory to quality excursions to government fees,” Palmquist asserts.

Gaining visibility
Cloud-based services give bio/pharmaceutical companies the ability to extend their visibility into all parts of the value chain, while at the same time enabling vendors to access the information they need in order to provide optimum services. Raw materials suppliers, contract research organizations, contract manufacturers, brokers, and distributors can all interact simultaneously under very controlled conditions that ensure that important information gets to the only the right people when it needs to, according to Palmquist.

More benefits of the cloud
There are several other practical advantages of using cloud-based systems, according to Karu. Because cloud-based software systems are developed by software experts, they are consistent for all users. Maintenance and upgrades are provided on a continual basis, as well as any necessary validation procedures to meet special compliance requirements for the pharmaceutical industry. There is also no need for investments in extensive information technology infrastructure; the servers are maintained by large companies (think Google and IBM). In addition, redundant systems located around the world ensure non-stop operation.

Perhaps most importantly, though, is the controlled nature of the interactions through cloud-based systems. “Generally the information that is being shared using cloud-based systems is already being shared via phone calls and e-mails. There are, however, much stronger controls in place in cloud-based systems that ensure that information only goes to the people who should see it. There are no such controls around the use of e-mails with file attachments,” Karu explains

Achieving assurance of supply
Overall, according to Palmquist, cloud-based systems offer bio/pharmaceutical companies assistance with achieving assurance of supply. All business activities can be integrated in the cloud and important issues, exceptions, and problems flagged automatically, so that efforts are appropriately focused on resolving potential issues. Not only purchasing systems, but logistics and quality management systems can be linked through the cloud so that the bio/pharmaceutical company is always up to date on what is happening and can readily share information that impacts multiple vendors.

“Moving an established quality system to the cloud and sharing it with raw material suppliers and contract manufacturers makes it possible for these vendors to exchange information immediately. In addition, these vendors can be directly included in specific activities, such as investigations of excursions and remedial actions, leading to much more rapid resolution of problems,” Karu comments. Similarly, cloud computing can benefit other aspects of supply chain management and aid in the rapid response to any type of possible interruption in the supply, from natural disasters to manufacturing malfunctions to distribution issues.

Collaboration is key
“The key to success for bio/pharmaceutical companies with such complex supply networks is collaboration across the value chain. Cloud computing is an effective way to enable such relationships,” Karu says. “There is definitely a growing realization in the pharmaceutical industry that suppliers must be thought of as extensions of the company. To be truly successful, we believe that the relationships between bio/pharmaceutical companies and their suppliers should be viewed more like joint ventures, with real transparency of information,” adds Palmquist.

The idea of allowing vendors to see into their business operations is the most challenging aspect of cloud computing for biopharmaceutical companies. “Most companies are at least initially very resistant to letting suppliers see their company information. It is not possible, however, for vendors to effectively participate in quality investigations, audits, and remediation efforts without two-way communication. He adds that the pharmaceutical industry tends to be very conservative about adopting new technology, in part due to concerns about acceptance by regulatory agencies, and cloud computing is no exception. “Both pharmaceutical companies and their suppliers are interested in cloud-based solutions, but neither is convinced that the other is willing to implement them. The greatest challenge at this point, therefore, is to convince the various members of the pharmaceutical industry supply chain to take the first step.

Early adopters
Companies that have already moved forward with the use of cloud-based services are those that have been pushed fastest towards emerging markets and have realized that ERP systems are insufficient and leave them “flying blind,” according to Palmquist. Pfizer is one example. “Pfizer needed to figure out a way to not only maintain but grow its revenue stream despite having 9 of its blockbuster drugs lose patent protection¾a Herculean task,” she says. Not only did the company need to better manage the supply side, it also needed help tracking costs (taxes, fees, etc.) on the value side in detail, something that was not a concern in the past with high-margin products.

“We expect that more companies will be in this same position and looking for solutions that enable simultaneous, multidirectional communications with numerous members of the value chain. As that occurs, there will also be greater realization that any dollars spent in the supply chain ultimately comes from the pharmaceutical company,” says Palmquist. In the past, it was easy for manufacturers to separate supplier costs from their costs because margins were high. That will no longer be the case as the industry becomes a low-margin business. “As we see in the consumer electronics industry, where every penny is tracked throughout the supply chain, it will be necessary for bio/pharmaceutical companies to look at supplier costs as their costs in order to maximize profits. Connect with suppliers through cloud-based systems will help not only control costs, but also quality and all other aspects of their operations,” she concludes.

For those reasons, Karu anticipates an explosion in demand for cloud-based services in the pharmaceutical industry. “The many-to-many relationships that are possible with cloud-based systems provide a much more efficient mechanism for processing information and managing interactions, which will be critical to the success of pharmaceutical companies in the increasingly challenging business environment they are facing,” he says.


Cloud Computing Solutions and the IT Budget

September 29th, 2014

Cloud computing solutions may be disrupting today’s IT budgets. New research has found that various technologies are affecting how much IT departments are spending.Cloud computing concept.

Outsourcing Falls

A new survey by Computer Economics discovered that, for the second year in a row, IT outsourcing has fallen while new IT resources are growing. About 10.2 percent of companies’ spending was allocated to outsourcing, a decline from 10.6 percent in 2013 and from 11.9 percent in 2012. Meanwhile, IT operational budgets rose 2.4 percent this year. Outsourced help desk, desktop support and application maintenance functions are on the decline, while IT security work and web operations services are seeing growth.

According to the results featured in ZDNet, IT managers want plug-in, ready-made services that are available thanks to cloud computing. They understand they can be ready with their solutions in just hours or even minutes. The study also pointed out that the classified use of software-as-a-service as a form of application hosting outsourcing is on the rise. The cloud is expected to continue to have an impact on both traditional outsourcing and in-house operations.

Investing in Infrastructure

Firms from all industries seek cloud computing solutions to increase collaboration and improve productivity; it is what IT professionals are budgeting for when investing in new infrastructure. At the end of the day, the benefits and risks of cloud computing affect how firms manage their IT infrastructure costs. Midsize firms often turn to public clouds since they do not have the same security risk and legacy IT restrictions as large enterprises.

When IT professionals at midsize firms aim for innovative cloud solutions, they aim to gain better-aligned technology spending that is in sync with business needs. At smaller firms, the money spent on IT is often aimed at maintenance and security areas, so it is easy to overlook the value of the cloud. IT professionals that fail to recognize the benefits of well-thought-out cloud strategies will not invest, and that can affect potential gains. By consulting with experienced cloud vendors, smaller firms can implement the right solutions that align with their business goals.

Spending Future

IT spending is outpacing outsourcing spending, and according to new research cloud has a lot to do with it. It is a trend that more midsize firms migrating to the cloud will see firsthand as the confidence in cloud solutions continues to take off in the marketplace.


Current critical issues in outsourcing

September 26th, 2014

The critical issues in outsourcing have evolved with changes in the marketplace, the growth in second- and later-generation outsourcing, and the new technologies such as cloud and big data. Lawyers handling outsourcing deals thus deal with new challenges in a wider variety of deals. This article will discuss those challenges and how you can mitigate the risks for your company as an outsourcing customer.Outsourcing29

Demand for an efficient but effective negotiation process. Early strategies of broad scale outsourcing to a single provider are giving way to strategic and specialized sourcing to multiple providers. The smaller deals still involve mission critical services, so sacrificing diligence or contractual protections can create substantial risk. Fortunately, you can get good results with the tools, processes and experience now available. These include proven contract and schedule templates, checklists, guides to help the business team gather and record needed information, a process designed to reduce the number of cycles to get to closure, and the experience both with the tools and processes as well as with the counter parties and similar transactions.

Resourcing not outsourcing. The traditional outsourcing model assumed that the provider was taking responsibility for an existing internal function. For example, the traditional dragnet clause requires the provider to perform all the functions previously performed by the customer at the existing service levels (unless those functions are explicitly excluded). As more customers are moving toward second-or-later-stage transactions, they need new approaches, including more robust service descriptions.

Need to integrate across service providers. As customers have an increasing number of outsourcing providers, the customers increasingly need to integrate and ensure close working relationships among providers. To build a working provider ecosystem, customers need to establish rules and relationships that protect the vital interests of each provider and reward collaboration. Because this approach is different from the traditional separation between competitors, you need to address this requirement early in the sourcing process and follow through in governance.

The double-edged sword of short term deals. In the face of increased uncertainty and dramatic change, customers have sought to increase flexibility with shorter terms. While customers may believe shorter term contracts protect them, the reality is that exit would be costly, time consuming and disruptive. Consequently, you would be prudent to include long-term contract protections even if the nominal term of the contract is short.

Establishing rights in critical provider technology. Customers are increasingly outsourcing to use provider technology instead of to find a lower-cost workforce to operate customer technology. For example, there is a rise in SaaS and cloud transactions. While customers still retain rights in their data, the bigger issue is what replacement system will be used to process that data. The risk can be mitigated by obtaining options to license some or all of the provider’s technology and commitments to provide replacement systems and transition support at predictable costs for substantial periods.

Securing “big data” rights and services. Advances in “big data” technologies have allowed companies such as Google and Amazon to create spectacular value with secondary uses of data. Traditional and even current service contracts often permit these secondary uses without compensation. For example, contracts often permit providers to retain aggregate and anonymized copies of customer data which allows the providers to benefit from data. In addition, customers often overlook opportunities to partner with their providers to gain the benefit of insights that be generated from the provider’s broader market data.

Retaining rights to protect business. As providers increasingly deliver with a global service delivery model integrated with provider processes and technology, traditional “step in” rights increasingly provide false comfort. However, customers continue to face the risk of providers becoming financially, operationally or otherwise unable or unwilling to perform specific mission-critical functions. To protect their businesses, customers increasingly value options to take specific work back quickly (including rights to take over assets and license materials) and commitments to provide information on an ongoing basis to make these options effective.

Minimizing risk, cost and surprises on exit. With more transactions reaching end-of-life, we too often see customers surprised by their vulnerability on exit when they seek to move the services to a replacement provider. Whether due to lack of motivation by the replaced provider, a lack of governance attention by the customer or a problem relationship, common complaints include exit rights designed for the technology at the signing date not fitting the technology at exit, incomplete or poorly organized data, and inadvertent waivers of exit rights needed to transition the services. You can mitigate these risks with flexible exit rights, including rights to key data, and by conducting regular audits of the data and using financial incentives for the provider to properly maintain that data.

Governance and follow-though (and follow-through, follow-through, follow-through). Too often, carefully drafted contracts are ignored and both parties operate without regard to the carefully considered processes and allocations of risk. Customers can, and frequently do, lose value by overlooking an important right, cost or protection for a long period. Like internal operations, outsourcing agreements must be persistently monitored to retain and build value. Adjustments to the contract should be reflected by deliberate mutual agreement and not by default.

Resolving disputes while preserving (or even building) the relationship. Disagreements in outsourcing agreements are inevitable, but resolving them is not. Experienced outsourcing customers have found that disputes that accumulate and remain unresolved can fester, weaken trust and destroy an otherwise productive relationship. Finding ways to quickly and efficiently force a resolution is the best way to maintain, and perhaps even build, trust and a strong working relationship. There are various strategies for accomplishing this ranging from novel governance structures to using third parties identified in advance to finally resolve disputes within specified dollar ranges.

The outsourcing market is growing more complex and risks are increasing. Yesterday’s contract will not overcome today’s challenges. However, you can manage that complexity and mitigate those risks using tools, processes and best practices developed over the decades of outsourcing.


Infosys targets cloud, big data with slew of partnerships

September 23rd, 2014

Infosys announced a series of partnerships – with Microsoft, Huawei and Hitachi Data Systems (HDS) – that will see the Indian outsourcing giant redouble its efforts to capture a growing share of demand for cloud and big data technologies and services.Outsourcing16

The deals will see Infosys couple its software and services expertise with technologies offered by a number of the company’s partners, and invest in cultivating more cloud and big data skills internally.

As part of the deal Infosys promised to make more use of Microsoft’s big data solutions including Power BI and Microsft Azure Machine Learning, as well as establish a global centre of excellence for Microsoft Azure Machine Learning capable of training more than 1,000 engineers by the end of fiscal year 2015.

The partnership with Huawei will see the two companies jointly develop IT solutions that combine Huawei’s cloud infrastructure with service expertise from Infosys, and build reference architectures and standardised solutions for big data platforms on Huawei hardware infrastructure.

Huawei and Infosys will also explore setting up a joint lab in China to enable better delivery in all areas of the partnership.

Finally, the partnership with HDS will see both companies target enterprise datacentres with jointly developed reference architectures. Infosys and HDS will also jointly deliver solutions that help migrate enterprise-grade applications to the cloud, and collaborate on deploying SAP HANA on Hitachi infrastructure.

The recently announced partnerships are part of Infosys’ broader effort to realign the IT outsourcing business towards cloud and big data. The Indian IT oursourcing business has seen growth rates drop dramatically over the past few years – from 21.8 per cent in 2011 down to 12.7 per cent in 2013 – as a result of a shift towards self-service in IT as well as the rising labour costs, low-cost labour once giving the industry a strong competitive edge.

That said, developing value-added services for cloud and big data platforms – still pain points for many large enterprises – will help Infosys and other outsourcers stay relevant as the business transitions away from wholesale outsourcing.


Huawei enters IT services with telecom projects

September 19th, 2014

Telecom networking giant Huawei has entered IT services, a shift from its hardware-focussed strategy which will eat into the marketshare of Indian software exporters, especially in telecom-related projects.Outsourcing10

The world’s largest privately held technology company is using its India R&D centre to take up projects involving managing of telecom infrastructure and their networks, thereby treading on the bread-and-butter businesses of Indian IT exporters. When contacted, Wilson Wang confirmed the development and told BusinessLine that engineers from India have started doing projects onsite and offshore for its clients such as China Mobile, China Telecom and others.

“Our 2,700 Indian engineers are paving the way in services, working on areas such as Ring Back Tones, cloud computing and agile software development, which helps telcos to provide different solutions to their customers” he said.

Huawei started off making telecom equipments such as routers and switches for telecom operators globally and within a span of a decade, the company gained significant marketshare from competitors like Cisco and ZTE. This development also underscores the ambition of Huawei, as it branches out into services, especially with global client base, noted Sanchit Vir Gogia, Analyst at Greyhound research.

The company, which started off selling networking equipment to Chinese telcos, now counts Mobily, MegaFon, Etisalat as their customers. “We already have an existing installed base of products that telecom companies use and services is our next frontier,” explained Wang. Also, services an area where Chinese companies have been laggards when compared to their Indian counterparts who have exported $75 billion worth of software in the 2014 fiscal year.

For a decade-and-a-half, Indian IT exporters have been trying to make a mark in the Chinese market, with the likes of TCS, Infosys, Wipro and others have subsidiaries in cities like Shanghai and Shenzen. However, they have not been able to make much inroads and almost all of these companies contribute a fraction of its overall turnover, according to company data. In a bid to spruce up revenues from China, TCS last year, Tata Information Technology was merged into TCS China.

Accroding to analyst data, global telecom outsourcing market is estimated to hit $76 billion by 2016.


Protected by تهنئة
Get Adobe Flash player