FT.com / Technology - Where do IT vendors think business’s focus should be?
Where do IT vendors think business’s focus should be?
By Alan Cane
Published: December 5 2007 04:40 | Last updated: December 5 2007 04:40
Vendors large and small believe that many – perhaps most – large organisations are capable of making big improvements in their use of IT.
They believe several technologies that had promised much in the past without necessarily delivering have now developed to the point where they can be used, for example, to re-engineer legacy applications or control data centres remotely.
These possibilities could be prejudiced, however, by factors including a deteriorating financial climate, which could place extra pressure on strained budgets, and a tenacious if mistaken belief among some managers that IT represents a cost rather than a source of innovation. These could hamper willingness to invest in new technologies.
In its 2007 global IT survey, however, published today, the consultancy Accenture found a close relationship between IT innovation, execution and productivity. “Those organisations that keep their IT investment steady in good and bad times have progressed most in using IT to transform the way they do business,” it says, arguing that organisations that are most advanced in adopting new mobility, collaboration and insight technologies performed better than their slower contemporaries across a range of benchmarks.
It found, for example, that the majority of what it describes as “high performers” – companies that excel in both innovation and execution – have shed most of their legacy systems and are investigating innovations such as software as a service and service-oriented architectures, which, it suggests, may lead to organisations owning only the software they have developed themselves to seek competitive advantage.
Vendors are aware that the “green agenda” is weighing heavily on CIO’s minds and pockets, although most seem more prepared to pay lip service to reducing their carbon footprint than actually doing anything about it.
A survey carried out by the software giant Symantec concluded that improving sustainability and meeting “green” policies set out at corporate level were not high priorities for IT departments in Europe. CIOs were driven to adopt green policies – improving energy efficiency, cutting cooling costs – in their data centres for operational rather than altruistic goals.
Only one in seven, Symantec found, had successfully implemented a green data centre. European organisations, however, were ahead of the US in adopting green policies.
John Hughman, senior technology analyst at the consultancy Ernst & Young, warns of the consequences of the explosion in IT usage and subsequent growth in data, which has put heavy pressures on the data centre.
The lifecycle costs of running a data centre now exceed the initial capital expenditure and a significant proportion of these costs can be attributed to power use – about half the budget goes on cooling.
Organisations must invest in virtualisation, running several operating systems and/or applications on a single machine, he says, to reduce the number of physical machines, pointing out that most servers only run at about 20 per cent utilisation.
He also calls for the relationship between data centre budgets and the cost of powering them to be made explicit. “It is unusual for CIOs to own this cost and therefore few are incentivised to help reduce it,” he says.
Most vendors think the pressure to “go green” will intensify and force change. Joe Hemming, chief executive of computing services group LogicaCMG, expects to be asked to undertake projects to help companies reduce their carbon footprint: “Whether this is through smart metering of energy use, green supply chains or the outsourcing of functions to low carbon environments such as India, this will characterise the year ahead.”
Mark Pearce, head of product marketing for the US-based networking group Enterasys agrees that top of the list for most CIOs will be managing down operational costs, data centre space and environmental impact.
“All three are going to drive virtualisation up the strategic agenda,” he says, adding the warning: “The CIO must not allow his team to rush into virtualisation without due diligence on key issues such as security. Virtualisation impacts a number of other disciplines and to allow a headlong rush into this area could prove extremely costly if done in isolation.”
Some vendors, however, think the IT department still has to win its corporate spurs on a decidedly difficult battlefield.
Steve Gedney, managing director of Borland’s UK operations sees next year as a tipping point. “Put simply, 2008 is the year when CIOs have to prove IT really can work with the business to transform processes and benefit the organisations they serve.”
“This year has seen new levels of large-scale IT project failure with organisations still working in silos using disconnected business and IT processes. The priority for CIOs in 2008 is to drive change to improve this situation,” he said, arguing for better IT metrics so that performance can be measured and improvements demonstrated.
Cisco, the company whose routers underpin much of the traffic on the internet, has for some years been expanding its presence in videoconferencing, in the belief that collaboration will be high up the CIO agenda.
According to Nick Earle of the company’s European markets division, business video will be the next big thing, as executives seek ways to collaborate without enlarging their carbon footprint.
“Some of the latest virtual conferencing technologies make the meeting experience almost as good as being face-to-face without the hassle of travelling. That is why I believe collaboration, enabled by business video, will top the IT agenda in 2008.”
Better communications are also high on the list for the networking group ntl:Telewest. Stephen Beynon, managing director of its business division, says he expects continued strong demand for ethernet services. “We expect this trend to continue in 2008, especially as users evolve beyond point-to-point and move to virtual private networks (VPNs). Ethernet VPNs are more complicated, which will see more customers seeking increased control over, and visibility of, the performance of their network.”
That, he thinks, is the job of the network provider, with simplicity and transparency the key.
Finding ways to cut costs so as to free resources for innovation is also expected to occupy the CIO’s attention.
Mirapoint of the US provides a simple example of where cost-savings can be madein the realm of e-mail. Commercial offerings are costly and should be limited to knowledge workers. It supplies staff with low collaboration needs with a simple e-mail appliance that cuts costs by half.
According to Alan Elliot, the company’s head of marketing, for every 10,000 employees who are shifted to the Mirapoint systems the company saves $1m a year: “This money can be spent on new technologies instead of an expensive e-mail platform,” he says.
Copyright The Financial Times Limited 2007
Showing posts with label Business Alignment. Show all posts
Showing posts with label Business Alignment. Show all posts
Monday, December 10, 2007
FT.com / Technology - What’s on CIO wishlists?
FT.com / Technology - What’s on CIO wishlists?
What’s on CIO wishlists?
By Alan Cane
Published: December 5 2007 04:40 | Last updated: December 5 2007 04:40
Aligning technology with the business, while dealing with the pressure on space and power in the data centre and addressing green issues are the priorities for many chief information officers next year.
Security is now so critical that it automatically figures near the top of every agenda. Steven Bandrowczak, CIO for Nortel, the Canadian telecommunications manufacturer, points out that a security contingency plan is there to prevent a breach of security that can badly damage a brand.
A thoroughly unscientific straw poll of CIOs, principally from the US and UK, revealed, nevertheless, that a few other themes come to the fore. Steve Bozzo, CIO of New York based online florist 1-800-Flowers.com, places business alignment at the top of his list.
“For 2008, as always,” he says, “companies will be most successful if IT is strongly aligned with the businesses it supports” going on to point out that companies must migrate to an “agile” architecture if they are to bring products to market that will have a meaningful impact on earnings and revenue: “Migrating to a Services Oriented Architecture will be the only way to accomplish this.”
This is in line with preliminary findings on 2008 priorities by research firm Gartner, which shows CIOs seeking to focus on aligning IT with growth and innovation. “Looking at costs is straightforward but prioritising growth and innovation is much more challenging,” says Dave Aron, a Gartner analyst looking at CIO issues.
Guy Lidbetter, chief technology officer for the big European computing services group Atos Origin, agrees, noting that the CIO agenda is being driven by a need for managed innovation.
He emphasises the importance of demonstrating to managers the value that IT investments bring to the business and ensuring IT is agile enough to support changing business needs. “In the context of infrastructure, standardisation, virtualisation and automation will deliver. In applications, enterprise architecture, service-oriented architecture and – potentially – Web 2.0 and collaboration will deliver.”
Note how quickly methodologies such as “agility” – developing software in a quicker, less formal way – and “service-oriented architecture” – ways of persuading legacy systems to work with the smart, new stuff – have moved from “might have” to “must have”.
Bryan Doerr, chief technology officer of Savvis, a US-managed service group, says, however, that to make the most of virtualisation, businesses need to invest in a secure and robust IT infrastructure. He says: “Both vendors and organisations are embracing new, virtualised technologies to yield more flexible and cost effective solutions. As it continues to mature, I predict it will become less of a differentiator for businesses and more of a commodity.”
Rorie Devine, chief technology officer for the online gambling organisation Betfair, concurs: “Virtualisation is definitely part of the mainstream now.”
Mr Devine’s chief priority next year will be to execute the business plan while helping to shape the business strategy. The processing load will be substantial: “The number of transactions we process will again be more than all the other years of our existence added together.”
Web 2.0 and social networking may be becoming candidates for the mainstream, although some CIOs have their reservations. Bob Worrall, for example, CIO of Sun Microsystems, reckons to have talked to well over 100 of his contemporaries over the past year and believes that social networking represents a new threat. “There is a lot of information out there on blogs and wiki, but there is no easy way to harvest that information and make it available to the organisation” he says.
Sun, however, has created a virtual Californian building in cyberspace and is experimenting with its use as a meeting place for remote staff.
Mr Worrall says that every CIO is struggling with the problem of power and space in the data centre. Sun itself is downsizing from seven corporate data centres to three, aided by a combination of new, more powerful servers based on novel chip technology and virtualisation – running several operating systems and/or applications on the same server.
Brian Jones, a former CIO for both the spirits group Allied Domecq and Scottish Power, says that IT in large companies often grows in an uncontrolled fashion. “There is often a need to remove the complexity that has grown up over time and set a simplification agenda directly linked to the objectives of the business overall,” he says, arguing that this latter aim can often be lost if the transformation is poorly focused.
He expects pressure on IT costs will not ease and that CIOs will be forced to balance the need for innovation against tightening budgets. “One trick that CIOs are going to have to learn, if they have not already, is how to take advantage of the latent value in their suppliers.” Suppliers have often spent millions on research and development which could benefit a company. While at Allied Domecq, for example, he formed a partnership with the telecommunications group that transformed Allied’s messy, “basket case” of a communications network, while reducing costs by £3m a year.
Mr Bandrowczak of Nortel, is using virtualisation and centralisation to get more efficiencies out of the IT assets the company already has and the investments it has already made. “That’s my first big trend. Second is how to integrate all these disparate and separate technologies. One trend I am driving at Nortel is unified messaging, handling voice, text and fax in one mailbox, so it can be retrieved by any device. Moving between applications causes inefficiencies – I call it business latency.”
His ambition is to combine a single log-on with authentication, so that if an individual was on the road and logged on, and another individual in the company wanted to share information with them, the system would indicate he or she was travelling and therefore available only by SMS but that they had the time to discuss that particular issue. “But we’re not there yet,” Mr Bandrowczak says.
RM, the supplier of IT to UK schools, places collaboration and mobility at the top of its list. Chris Clements, the CIO comments: “Our vision for collaboration goes beyond our employees and includes our customers. We have a large candidate list of opportunities to add value to our core systems by providing tools that will enable customers directly to influence product development and enable them to do business at any time of the school day that is convenient to them. One of the biggest challenges is to evaluate Web 2.0 opportunities and select those which will add real value to the business.”
And the green agenda? A study by Symantec (see “Vendors’ View”, Page 4) suggests organisations are not yet successfully rolling out green centres.
But the bandwagon is on the move. The consultancy Quocirca thinks companies will finally make better use of advanced communications capabilities such as web 2.0 and videoconferencing to reduce travel. But it concludes a little wearily that style will defeat substance in some cases. “There will still be those who want to be seen to be green but who do not really take the issue on board and resort to half measures such as carbon off-setting.”
One thing all those questioned agreed on, however, was that it is going to be an interesting year.
CIO priorities, based on Alan Cane’s informal straw poll:
1 Business alignment and strategy
2 Hiring and retaining the best staff
3 IT innovation/new methodologies
4 Security
5 Collaboration technologies
6 Controlling costs
7 Compliance and regulation
8 Virtualisation
9 Customer service
10 Mobility (Green issues came 11th)
Copyright The Financial Times Limited 2007
What’s on CIO wishlists?
By Alan Cane
Published: December 5 2007 04:40 | Last updated: December 5 2007 04:40
Aligning technology with the business, while dealing with the pressure on space and power in the data centre and addressing green issues are the priorities for many chief information officers next year.
Security is now so critical that it automatically figures near the top of every agenda. Steven Bandrowczak, CIO for Nortel, the Canadian telecommunications manufacturer, points out that a security contingency plan is there to prevent a breach of security that can badly damage a brand.
A thoroughly unscientific straw poll of CIOs, principally from the US and UK, revealed, nevertheless, that a few other themes come to the fore. Steve Bozzo, CIO of New York based online florist 1-800-Flowers.com, places business alignment at the top of his list.
“For 2008, as always,” he says, “companies will be most successful if IT is strongly aligned with the businesses it supports” going on to point out that companies must migrate to an “agile” architecture if they are to bring products to market that will have a meaningful impact on earnings and revenue: “Migrating to a Services Oriented Architecture will be the only way to accomplish this.”
This is in line with preliminary findings on 2008 priorities by research firm Gartner, which shows CIOs seeking to focus on aligning IT with growth and innovation. “Looking at costs is straightforward but prioritising growth and innovation is much more challenging,” says Dave Aron, a Gartner analyst looking at CIO issues.
Guy Lidbetter, chief technology officer for the big European computing services group Atos Origin, agrees, noting that the CIO agenda is being driven by a need for managed innovation.
He emphasises the importance of demonstrating to managers the value that IT investments bring to the business and ensuring IT is agile enough to support changing business needs. “In the context of infrastructure, standardisation, virtualisation and automation will deliver. In applications, enterprise architecture, service-oriented architecture and – potentially – Web 2.0 and collaboration will deliver.”
Note how quickly methodologies such as “agility” – developing software in a quicker, less formal way – and “service-oriented architecture” – ways of persuading legacy systems to work with the smart, new stuff – have moved from “might have” to “must have”.
Bryan Doerr, chief technology officer of Savvis, a US-managed service group, says, however, that to make the most of virtualisation, businesses need to invest in a secure and robust IT infrastructure. He says: “Both vendors and organisations are embracing new, virtualised technologies to yield more flexible and cost effective solutions. As it continues to mature, I predict it will become less of a differentiator for businesses and more of a commodity.”
Rorie Devine, chief technology officer for the online gambling organisation Betfair, concurs: “Virtualisation is definitely part of the mainstream now.”
Mr Devine’s chief priority next year will be to execute the business plan while helping to shape the business strategy. The processing load will be substantial: “The number of transactions we process will again be more than all the other years of our existence added together.”
Web 2.0 and social networking may be becoming candidates for the mainstream, although some CIOs have their reservations. Bob Worrall, for example, CIO of Sun Microsystems, reckons to have talked to well over 100 of his contemporaries over the past year and believes that social networking represents a new threat. “There is a lot of information out there on blogs and wiki, but there is no easy way to harvest that information and make it available to the organisation” he says.
Sun, however, has created a virtual Californian building in cyberspace and is experimenting with its use as a meeting place for remote staff.
Mr Worrall says that every CIO is struggling with the problem of power and space in the data centre. Sun itself is downsizing from seven corporate data centres to three, aided by a combination of new, more powerful servers based on novel chip technology and virtualisation – running several operating systems and/or applications on the same server.
Brian Jones, a former CIO for both the spirits group Allied Domecq and Scottish Power, says that IT in large companies often grows in an uncontrolled fashion. “There is often a need to remove the complexity that has grown up over time and set a simplification agenda directly linked to the objectives of the business overall,” he says, arguing that this latter aim can often be lost if the transformation is poorly focused.
He expects pressure on IT costs will not ease and that CIOs will be forced to balance the need for innovation against tightening budgets. “One trick that CIOs are going to have to learn, if they have not already, is how to take advantage of the latent value in their suppliers.” Suppliers have often spent millions on research and development which could benefit a company. While at Allied Domecq, for example, he formed a partnership with the telecommunications group that transformed Allied’s messy, “basket case” of a communications network, while reducing costs by £3m a year.
Mr Bandrowczak of Nortel, is using virtualisation and centralisation to get more efficiencies out of the IT assets the company already has and the investments it has already made. “That’s my first big trend. Second is how to integrate all these disparate and separate technologies. One trend I am driving at Nortel is unified messaging, handling voice, text and fax in one mailbox, so it can be retrieved by any device. Moving between applications causes inefficiencies – I call it business latency.”
His ambition is to combine a single log-on with authentication, so that if an individual was on the road and logged on, and another individual in the company wanted to share information with them, the system would indicate he or she was travelling and therefore available only by SMS but that they had the time to discuss that particular issue. “But we’re not there yet,” Mr Bandrowczak says.
RM, the supplier of IT to UK schools, places collaboration and mobility at the top of its list. Chris Clements, the CIO comments: “Our vision for collaboration goes beyond our employees and includes our customers. We have a large candidate list of opportunities to add value to our core systems by providing tools that will enable customers directly to influence product development and enable them to do business at any time of the school day that is convenient to them. One of the biggest challenges is to evaluate Web 2.0 opportunities and select those which will add real value to the business.”
And the green agenda? A study by Symantec (see “Vendors’ View”, Page 4) suggests organisations are not yet successfully rolling out green centres.
But the bandwagon is on the move. The consultancy Quocirca thinks companies will finally make better use of advanced communications capabilities such as web 2.0 and videoconferencing to reduce travel. But it concludes a little wearily that style will defeat substance in some cases. “There will still be those who want to be seen to be green but who do not really take the issue on board and resort to half measures such as carbon off-setting.”
One thing all those questioned agreed on, however, was that it is going to be an interesting year.
CIO priorities, based on Alan Cane’s informal straw poll:
1 Business alignment and strategy
2 Hiring and retaining the best staff
3 IT innovation/new methodologies
4 Security
5 Collaboration technologies
6 Controlling costs
7 Compliance and regulation
8 Virtualisation
9 Customer service
10 Mobility (Green issues came 11th)
Copyright The Financial Times Limited 2007
Subscribe to:
Posts (Atom)