Post Digital Outsourcing - Going for Value

One of the things which always has frustrated me when dealing with traditional outsourcing companies has been the huge gulf between the Sales Proposition and the Reality of Day-to-Day Service.

Companies usually think they are going to buy the best skills in the market and get access to superlative service from a transformational partner who delivers agility and control, so they can forget about the complexities of running IT. In reality they get bland, slow moving and unimaginative bottom up services which are slow and expensive to change. Where people have looked for partnership, this has usually failed to materialise as relationships descend into "Robust User-Supplier Conflict" (or RUSC). In fact the traditional model has been an anti pattern to progressiveness and this has only been made worse by offshoring to Asia, where extreme cultural differences and expectations have only made things worse.

As I mentioned in a previous blog, The Death of Outsourcing, this model is no longer sustainable in the light of all things digital. So what can a Post Digital Service Provider offer now that XaaS threatens to steal outsourcing's breakfast?

The reality is that, whilst XaaS does a lot to free an enterprise from the Tyrrany of Infrastructure, XaaS introduces new complications as the overall technical environment is much more complex; Digital also means that enterprises need to learn to move quicker with disciplined lean practices that enable continuous change. New IoT based models also bring new challenges of scale.

So the new breed of Digital Service Partner needs to position itself to avoid RUSC and focus on Assured Value, Integration and Speed. Where: 

• Assurance covers secure and consistent delivery of change and operations;
• Value focuses on user and customer experience, insight and the right quality at an affordable price;
• Integration deals with the complexity of identity and integrating multiple sources of XaaS services as well as working with multiple SI partners and in-house development teams to deliver joined up services;
• Speed addresses agility, continuous change, innovation and responsiveness to changing business and technical opportunities and risks.

Such services are likely to include 3 key elements:

1. a Foundational Use of IT Access Service - everything needed to deliver a user device centric service, e.g. smart phone, pad, laptop and supporting network, gateway, office automation software, storage, print, peripherals and anti malware based services.
2. a Service Integration And Application Management Service (SIAM) - which integrates and delivers services on a Hybrid Cloud basis. This is likely to include Architecture Management (AMO), Programme Management (PMO), Service Delivery (SMO), and Security Operations (SOC and Security Operational Processes), as well as Activity Based Costing (along TBM or OBASHI lines).
3. a Lean System Integration Service - which can provide specialist development and implementation skills, but also embraces partnering with internal and 3rd party partners and provides support for the full range of Agile and DevOps processes needed to deliver continuous change.

Naturally there will be other more specialist services which may come too, e.g. computer forensics and advanced threat intelligence, Fleet Management for IoT devices, or managing innovation communities as innovation goes social. But these will be value adds building on a core foundation.

At The Edge of The Enterprise and the New Lean

One of the Truisms for anyone practising IT Strategy and Architecture, is that All the Competitive Opportunities Arise at the Edge of the Enterprise. Everything else is about making business more fit to exploit them through improving the agility, effectiveness, efficiency and protection of  business capabilities.

This is why Digital has been so important. Digital blurs the edge of the enterprise so that a business may operate globally to reach more customers or provide a more comprehensive service to existing customers. Digital also make it easier to partner with other organisation to deliver new products and services or a better sales and delivery experience. 

Digital also makes it easier to reach out and find out what is going on in the market place and find out what is going on and to affect delivery of service in customers homes, premises and assets through combinations of IoT and Big Data.

However, as companies all adopt digital models and Digital becomes the new normal other things are starting to happen. Customer expectations have risen and improving the "Customer Journey" or the life cycle of customer experience has now become essential. This is now encouraging greater examination of internal processes and capabilities.

Whereas before, internal capabilities were improved for scalability, predictability and efficiency. Now, internal capability has to be optimised to address everything that is essential for delivering service to customers. Digital has become part of the New Lean Organisation. Not only does this change the nature of investment, it requires continuous discipline, development of Enterprise Architecture capability, partnering with Product Managers (especially in Marketing) and investment in flexible productivity technologies such as BPM and Machine Learning to reduce lead times for customer fulfilment, improve consistency and enable employees to spend their time doing meaningful work (as opposed to the drudgery of many repetitive clerical tasks).

This will not only make employees more productive, but it should enable organisations to deliver a wider range of products and services, tailored more specifically to individual customer needs and with enhanced economies. For some people this means more fulfilling jobs. For others this represents a threat to low skill jobs. The biggest challenge now is going to be the (re)training of low skill employees. 

CIOs - Don't Go To Switzerland!

The 2017 survey, Navigating Uncertainty, conducted by Harvey Nash and KPMG contained many data points on a significant number of current issues. One of the surprising themes, however, was a general conclusion that CIOs in Switzerland may be having a rough time.

One of the few positive indicators was the fact that very few Swiss CIOs have changed job in the last year, which may have a negative interpretation too, if there are no opportunities to go to. Apart from that there were some rather challenging statistics.

Switzerland is bottom of a table of 24 countries for CIOs receiving pay increases. Only 14% received an increase.

Swiss CIOs are very likely to increase the level of outsourcing, sitting 8th out of 28 countries. Over 50% are likely to do this, incurring constraints on successfully pursuing a digital model.

Only some (just under a third) have received budget increases, placing Switzerland 25th out of 28 countries. Again makinf it dificult to pursue a transformational digital model.

At the same time, Switzerland ranks one from bottom in terms of the level of major Cyber attacks experienced by their businesses with over 50% having been attacked in the last 2 years. Additionally, Swiss CIOs rank above the global average in expecting political turbulence to affect their plans. This sits well above any Brexit influence.

One has to ask, what is going on in Switzerland and why?

GDPR, CIO issues, Lean Data & Data Portfolio Management

Last night's CIO event hosted by Harvey Nash and KPMG was held to launch their 2017 CIO Survey "Navigating Uncertainty".

In the Panel discussion afterwards, one of the key issues raised was about "knowing where your data is". GDPR is certainly driving this, for personal data in Europe and anyone who trades with organisations or consumers based there. As its difficult to implement the "right to be forgotten" if you don't know what data you hold and where it is. Similarly, SoX in the US has driven similar concerns about Financial data. The move to "Cloud First" also compounds this need, as it is core to successful integration.

So why is this such a big deal as much of GDPR is about doing things which a business really ought to be doing anyway? basically its ancient history. Most large organisations have grown partially by merging with and acquiring other organisations. Their management teams often have the tendency to declare victory before full integration occurs.

Then there are cost cutting issues. Most businesses have been through boom and bust cycles of  large investment followed by cost cutting and asset squeezing. Often this has included head count reductions or outsourcing. Each of which ensures that knowledge about where things are leaves the organisation. Many service providers tend not to document things well, if they are allowed to get away with it, as this helps keep effort and FTE (therefore costs) down. There is natural staff churn of anywhere between 5% and 20% per year in typical companies, depending upon culture, rates of pay and opportunities. Documentation does not keep pace with lost knowledge as exit processes are usually poor in knowledge transfer.

Finally, DIY activities in the business often results in unofficial applications being adopted, especially as XaaS makes this easy to do. So put this all together and it is little wonder that organisations often do not know where their data is or even what data they have. This is a situation which brings inherent risk. If an organisation does not know where its data is, how does it protect it. If no one knows what data is help and "managed", then how is it integrated, kept coherent, kept clean and timely? how does the organisation know what it is actually spending on data or even what the value of its data is. Then there is the small matter of compliance. How does the organisation know whether it is complying. These are all data hygiene issues which need to be addressed if digitisation is going to support a Digital Business Model.

So now is the time to introduce Lean Data and make sure that Data Portfolio Management (DPM) is practiced as part of any approach to Asset Portfolio Management. (Asset Portfolio Management = Application Portfolio Management + Infrastructure Portfolio Management + Data Portfolio Management).

Lean Data principles mean that:

• Organisations know what data they hold and manage;
• Data is classified according to subject area and criticality;
• Only the minimum data necessary to Add Value to the business is held;
• Data replication is kept to the minimum level necessary to optimise business performance;
• Data Value is determined by its utility in Serving the Customer, Supporting Essential Capability, Protecting the Organisation, Providing Insight for Business Decision Making.

Data Portfolio Management is concerned with:

• Knowing what data is held and where it is;
• Understanding the quality of the data;
• Knowing what technology is used to manage the data and its overall condition;
• Being able to address questions concerning issues such as criticality, protection, archiving, cost of management;
• Understanding how Master Data Management (MDM) and integration occurs;
• Knowing who has Stewardship responsibility and consumer rights for the data;
• Regularly reviewing management actions to improve Data Value and address Lean Data principles.

Splunk - Digital Automation for CyberPunks

Last week I went to Splunk's event held at the InterContinental next to the O2 tent in Greenwich. 

This was a very well attended event and I got the impression that Splunk has now emerged to be a dominant player in the DevOps area around the automation of Operational Monitoring and Fault Analysis.

What I had not realised before going to the event, although I had coincidentally been discussing the potential the week before with a former colleague at Google's event, is that Splunk now provides a credible Security Event Management toolset for use in Security Operating Centre (SOC) activities, as well as a user activity analysis tool. In fact there were some interesting case studies focusing on building Lean SOC's incrementally.N.B. Gartner now positions Splunk as the leading vendor in its magic quadrant for SOCs.

It was also interesting to hear that Splunk now has a full scale partnering programme with other technology vendors, enabling integration with both new sources of data for exploitation within Splunk as well as value adds to Splunk, thus offering greater levels of automation.

However, Splunk was a little vague about future directions for the toolset. However, there does appear to be an opportunity around Application Cost Management and hooks into general Application Portfolio Management. This arises because to use Splunk effectively, you have to build a model of each application monitored which covers all the infrastructure (physical or virtual) elements used within an application in a similar manner to the models used in OBASHI or TBM (which are 2 similar but competing approaches to cost management) or in architectural tools such as Troux (now Planview) and alfabet used for application portfolio management.

This would enable a more integrated approach to some aspects of managing an application estate, gathering technical condition and cost information together to support continuous portfolio management.

Digital, Cinematography & Art

The other night, I was lucky enough to go to a UK premier event for "Guardians of the Galaxy 2" (GotG2), organised by the British Cinematography Society and sponsored by RED. This was held at the Regent Street Cinema, which opened as the first cinema in England in 1986. Apart from being a very entertaining film, GotG2 is remarkable because it is the first film made with RED's 8K Weapon camera which is currently the world's highest definition digital cine-camera.

The reason that the event was so interesting, was that there was a live interview with Henry Braham the chief cinematographer involved in making the film. This gave real insight into why the makers decided to use this particular camera, the overall design process and some of the practicalities involved in making such a visually stunning, high action film with multiple special effects.

For someone who is not involved in the film industry, it was startling to learn that typically such a film will involve a global team of close on 15,000 people. This means that all those endless credits at the end of a film only really represent the tip of the iceberg and making a film is at a similar level of complexity to designing and building a large item of capital equipment like a ship or an oil rig.

I also learnt that it took over 3 months to plan out the main scenes in terms of what the scene involves, who moves where, the angles from which the shots will be made, how the camera or cameras are going to be positioned and moved, as well as what the lighting arrangements will be to create the right visual story. Then there is a lot of interaction with the other departments, e.g. costumes and make up, to ensure that the overall visual intent will come together coherently. Furthermore there is a lot of testing to validate that the camera will perform in the intended conditions and to ensure that the limits of the camera's functional capabilities are understood.

Then there is the organisation of the shooting at the various sets used and continuous validation of the footage shot by review in on site min-cinemas, even before the footage goes for full special effects processing.

Overall, it seems that the film industry got to Agile Development and Continuous Integration before the software industry. It also validates a metaphor I sometimes use to explain to non IT people that project managers are like film producers, solution architects are like film directors and requirements are like a film script. But it also brought home, how despite all the technology and the automation involved in making a film, the creative process is still subject to the laws of physics and still needs a huge investment of skill and artistry to deliver. Jobs may have changed, but technology has not made people obsolete.

The Emperor's New Digital Clothes

In many Sci Fi books, the heroes get to use advanced space suits which act more like autonomous space ships. They take verbal instructions on where the user wants to go and takes him or her there, doing all the navigation and thrust control, adapting freely to each circumstance that they encounter and transporting the wearer over vast distances. They are even capable of making safe atmospheric entry and touch down.

We may not be there yet, but we are seeing the emergence of a number of technologies which start to make this seem like a plausible future. Firstly, there are a wide range of fabrics which can be woven into electronic circuits and change colour as the result of external stimuli, such as heat, laser light or electrical charge. Secondly there is an increasing range of devices built for embedding into material for reading temperature, blood pressure, pulse rates and so on. Thirdly, 3D printing is being augmented by 4D printing, which essentially enables "shape memory" characteristics to be built into whatever is printed. 3D printing already has evolved beyond wax model and plastic component printing, to cover chemical printing and metal printing. So it is already conceivable that clothes will be printed and no longer sewn.

This means that it is quite likely that within 20 years, the fashion industry may have changed beyond all recognition. People will no longer have wardrobes stuffed full of clothes. Instead they will have a few suits of clothes optimised for categories of use, e.g. work, casual wear, party gear, outdoor activities. These will be blanks onto which patterns will be electronically downloaded to give the style, fit, colour scheme or pattern that the user wants. So fashion will be sold as electronic designs rather than garments, making for a more ecologically sound approach to clothing. It may be that the patterns will be dynamic so that they respond to other stimuli. So for instance you could have party clothing which responds to the beat of the music or the heat of your body. Your clothing could respond to changing weight so that it expands and contracts in size along with your weight. Uniforms for the armed forces could be tailored to provide adaptive camouflage and so on. There might even be other functional adaptions such as the ability for police uniforms to adapt so that they bulk up and become protective against projectiles in a riot situation. Alternatively, the weave of the cloth could adapt to external conditions so that your clothes are naturally aspirated and cooling when it is hot and extra insulating to retain heat when it is cold.

This really means that "The Emperor" could walk about in almost invisible clothes which change and adapt to become formal attire when he goes out in public.

Google The Rainmaker

On a day when CIO Magazine reported on an Uptime Institute study indicating that only 13% of enterprise loads are operating in the Cloud, Google is holding its Google Cloud Next conference in London.

The key message is that Google is in the cloud hosting game for the longterm and is offering to partner enterprises through their Digital Strategies and to help them unlock the value of their data.

One of their most impresive case studies is helping LUSH the bathroom smellies company to move its global operations to Google Cloud Platform in just 22 days.

Otherwise Google is trying to make a compelling case for its offerings in terms of flexibility of scaling an pricing, the richness of G suite in the collaboration and app devleopment space, AI and bot support as well as data management and Big Data agility. All backed up by rock solid security and sharp performance. 

However, for small companies and start-ups the affordability of its office apps, ubiquity of platforms and flexible pricing makes GCS a "no brainer" for consumer facing brands.

So rather than just trading on its born in the clouds heritage, google is fully positioning itself as a Cloud Builder and a Digital Rain Maker.