Monday, August 24, 2015

Digital Transformation: Crossing the Skills Chasm

Most informed CEOs seem to know intuitively that the most qualified person to lead their forward-looking business technology advancement isn’t likely to have the profile of a typical legacy CIO. In contrast, the role of a Digital Business Transformation innovator has very different requirements to the traditional IT utility infrastructure custodian of the past.

That said, some progressive CIOs are already making the transition to lead the digital competitiveness quest, and others will surely follow. Moreover, a few multinational companies currently have a CIO in a highly strategic, visible and collaborative position within the company. Their challenge is to guide the rest of the organization’s leadership to attain the required skills that will enable them to actively participate in the planning and execution of a new strategy – empowered by digital technologies.

The Harvard Business Review (HBR) market research team recently completed a global study of the path that several organizations have taken to develop and deliver the digital learning support resources that their key internal stakeholders both need and want. The results of this research portrays an environment that may be familiar to many CEOs that have, or are about to, embark upon a similar journey.

The HBR survey found that companies that rate highly in both digital leadership and management have better business results than their peers, with stronger revenue growth and greater profit margins.

Just under a fifth of survey respondents fell into this early-adopter or “Digital Leader” category, while over a third were deemed to be “Laggards” – i.e. an organization that’s weak in both digital leadership and management. Moreover, nearly half of the survey respondents had mixed scores and were rated as “Followers.”

What set the leaders apart from their peer group, in laggard or follower organizations? These proactive CIOs help their business colleagues to understand which digital knowledge and skills need to reside in their function, and which they can defer to the IT support team. The CIOs and their staff typically communicate in language that makes sense to a Line of Business (LoB) leader that’s focused on achieving outcomes.

Why Superior Digital Acumen Matters Most

According to the HBR study findings, digital acumen has become a critical component of all forward-thinking senior leadership teams. But there’s often a significant gap between what’s needed to succeed, and the current state inside many mainstream companies today.

About 23 percent of the survey respondents indicated that they’re confident their organizations have the necessary knowledge and skills to succeed in the digital aspects of their business transformation.

However, the recognized Digital Leaders in the respondent group were significantly more confident that their organizations have the both the required knowledge and skills they need -- in fact, 67 percent were extremely confident, compared with only 19 percent of the Followers and 5 percent of Laggards.

Clearly, there’s no substitute for the credibility and confidence that comes from having qualified digital-savvy executive talent at your disposal. Put simply, HBR discovered that the lack of leadership is the number-one issue holding most companies back, when it came to determining their digital business readiness; particularly among the Laggard companies.

Business Imperative for Digital Competency

Perhaps you’re wondering, is the skills development effort really worth the trouble? Does the payback justify the investment in time and energy? Let’s now explore the primary motivation for attaining digital supremacy, and you can decide what’s best for your company, within your industry.

The Digital Leaders in the survey were significantly more likely to have seen revenue growth of 10 percent, or more, over the past two years (58 percent of the Leaders vs. 43 percent of the Followers and 38 percent of the Laggards).

There’s no reward for taking a wait-and-see approach, even if the conservative late-adopter posture was taken with the best of intentions. The Laggards reported that they were twice as likely to have seen revenues decline (18 percent vs. 9 percent).

Fostering Collaboration and Shared Objectives

The CIOs at Digital Leaders are much more likely to be characterized as digital coaches or masters (45 percent of respondents, compared with 26 percent at Follower companies, and only 14 percent at Laggard companies).

By comparison, 45 percent of the Laggard companies had a CIO that’s been characterized as a “turf protector” that inhibits or resists collaboration -- or they merely had no designated CIO role at all.

A full 74 percent of the Digital Leaders have CIOs who support business-led IT projects. That is, when Line of Business leaders directly fund, contract, and/or develop technology capabilities themselves. This response compares with 64 percent of the Followers and only 40 percent of the Laggards.

Furthermore, the respondents who characterized their CIO as a digital coach or master had significantly higher scores -- over 80 percent of those respondents said their CIO supports business-led IT projects. This doesn’t mean, however, that those CIOs are ceding procurement control -- rather, they’re willingly sharing it in order to achieve the desired business outcome objectives of the whole leadership team.

Digital Skills Education and Mentoring

According to the HBR assessment, there’s little doubt that organizations need to do more to increase their business leader’s digital acumen. In the past, learning new skills might be a task that was assigned to the internal Training group or the Human Resources department. In this scenario, the education and mentoring responsibility should go to those who have mastered the digital transformation craft.

That said, finding a role model(s) for digital acumen knowledge transfer can be problematic. While 46 percent of respondents said they would like to learn more about digital trends from their CIO, close to two-fifths said their CIO doesn’t seek to educate and empower LoB leaders when it comes to digital skills.

Besides, over a third of the respondents said their IT team doesn’t provide useful knowledge about technology applications or understand which digital knowledge is most important to specific functions or lines of business.

In a follow-on editorial I’ll share more details about the illuminating findings from this study, and the associated recommendations for a plan of action. HBR Analytic Services interviewed a total of 436 business leaders from across the globe. The survey was sponsored by Red Hat, Inc., as part of The Enterprisers Project.

Wednesday, July 22, 2015

Why Your Organization Deserves a 'Real' Open Cloud

Worldwide, there's a growing appreciation for the many benefits of the Open Source way. Clearly, being truly Open is a frame of mind that can apply to just about anything in life -- including the development and nurture of a progressive company culture that's equipped for the challenges and opportunities of today's Global Networked Economy.

Jim Whitehurst, CEO of Red Hat, recently launched his new book entitled "The Open Organization" -- Igniting Passion and Performance. He says, "The conventional approach to business management was not designed to foster innovation, address the needs and expectations of the current workforce that demands more of jobs, or operate at the accelerated speed of business."

Granted, savvy senior executives within numerous multinational companies across the globe have already embraced the open way, and others will surely follow. Why would any forward-thinking CEO settle for the constraints of a legacy organization model, when the modern alternative is so much more rewarding?

Furthermore, when given the choice of an open business technology architecture that's designed for the 21st Century, is there any logical reason to accept the apparent limitations of an underlying IT infrastructure that was conceived in a bygone era of the post-industrial society?

How do you rationalize an ongoing investment in a legacy IT platform that has inherent high-cost software license handicaps and built-in undesirable technical limitations that severely impact both the ROI and operational performance?

My Point: don't let your prior sunk IT investments sink your future Open cloud options.

Cloud Computing Platform Trends

Cloud computing infrastructure assets are a key foundation for enabling strategic digital business transformation projects. It's the essential platform that positively impacts all emerging areas of IT service design, development and consumption. It also provides the basis for many of today's emerging big data, enterprise mobility and social commerce solutions.

International Data Corporation (IDC) predicts the number of new cloud-based solutions will triple in the next four to five years. They've examined the current status of cloud computing deployment in several vertical industries, and have unveiled the first of four special reports on this topic.

Their latest global market study identifies industry-specific drivers and barriers of using cloud computing technology and presents insights in terms of how to leverage cloud computing to create new commercial value.

According to the IDC assessment, industry-specific cloud-native applications will be a driving force, as perceptive CIOs look for solutions that can be easily configured to their unique digital business and vertical industry requirements.

Moreover, IDC believes that more organizations -- across industries -- will shift steadily toward enlightened cloud-first strategies to enable digital business transformation goals and objectives.

Key findings from the IDC report include:
  • IDC predicts that public cloud computing will reach almost $70 billion in 2015 worldwide, with the top 5 verticals (discrete manufacturing, banking, professional services, process manufacturing, and retail) accounting for approximately 45 percent of the total spend for the market.
  • The major opportunities for cloud within verticals come from the development of intelligent industry solutions, which are built on top of a new platform that includes cloud as well as big data and analytics, mobile, and social.
  • Those IT suppliers that showcase the long-term benefits and the true value of the cloud as a platform in a given vertical (e.g., efficiency gains in business processes and improvement in customer acquisition/customer experience) will be most successful.
  • The ease of purchasing cloud-based solutions has helped transfer buying power from IT to functional lines of business like marketing, finance, and operations.
  • Security and regulatory remains the biggest barrier for cloud adoption across industries like government and financial services, while loss of perceived control over IT assets and massive legacy systems are also stumbling blocks for using cloud offerings.
"The technological innovations and enabling capabilities unleashed by cloud computing have fostered new opportunities across the industries," says Eileen Smith, program manager at IDC.

Besides, IDC asserts that cloud services will remain the essential foundation of the what they call the "3rd Platform" of growth. IDC also predicts there will be more industry-specific cloud service platforms and marketplaces that are hosted by the recognized forward-looking leaders in each vertical industry.

Each of these pioneering organizations will be seeking to establish an Open Community of independent software application developers that will introduce contemporary thinking about new business model possibilities and thereby create valuable digital service innovations.

Smith concludes, "We have already seen such platforms and innovation communities in place in retail, financial services, media, and other industries. This will reshape not only how companies operate their IT but also how they compete in their own industry."

It's imperative that CIOs choose to develop strong customer-partner relationships with the authentic Open Cloud platform vendors, in order to fully seize the nascent market opportunities. The key take-away -- beware of the Faux-Open evangelists that insult your intelligence by suggesting that burying a cloud-native application within a proprietary legacy IT platform is good enough.

It's not acceptable, to the modern CIO or their key internal stakeholders. Informed Line of Business leaders know that they deserve a real open cloud solution that meets all their requirements. Anything less is an unnecessary compromise that will inhibit the achievement of their strategic business outcome objectives.

Thursday, July 2, 2015

Enterprise Mobility Applications Gain Traction in Europe

The mobile communications revolution that has transformed our lives as consumers is now similarly redefining the way forward-looking enterprises manage their operations and engage with employees, partners and customers.

The ongoing pursuit of digital business transformation projects are prompting many CIOs to rethink the technologies, services and techniques that underpin their enterprise mobility initiatives -- evolving traditional roles, responsibilities and organizational cultures in the process.

While the numerous commercial applications for smartphones within the workplace tend to be top-of-mind for savvy Line of Business leaders, now mainstream applications for media tablets have also broadened the productivity enhancing potential of mobile device app development.

Device Adoption in European Organizations

A large number of the tablets already deployed across British, French and German companies are now considered to be the only device that employees are equipped with to perform their daily work, according to the latest market study by International Data Corporation (IDC).

"Regardless, the majority of tablet users in enterprises currently have at least one other device to perform their online business activities," said Marta Fiorentini, senior analyst at IDC.

Additional devices are usually desktop or portable PCs, smartphones, workstations -- or, depending on the employee's role, specialized hand-held or point of sale (POS) devices.

However, a large share of the tablets in circulation are used by employees as their only work tool, either replacing traditional client devices or for functions previously not supported by any computing device.

According to the IDC study findings, tablets are the only business device for 40 percent of the polled respondents to their recent survey. This percentage, however, increases significantly for 2-in-1 or convertible devices -- as these hybrid products are often deployed to replace traditional PCs.

The study also shows that hybrids -- in either the detachable or convertible form factor -- are usually purchased with larger screen sizes than tablet slates. In fact, IDC says that while just over 10 percent of all slates have a screen size larger than eleven inches, the current percentage for hybrids is almost 30 percent -- this is expected to surpass 50 percent of these devices over the next couple of years.

Exploring Commercial Tablet Use-Cases

In spite of the cannibalization effect on traditional client device markets, standalone commercial tablets are also creating a huge opportunity for vendors. IDC calculated that in 2014 this incremental market accounted for almost 6 percent of tablets used as standalone in the UK, France and Germany.

IDC expects this percentage to increase quickly in these three countries and exceed 20 percent over the next 24 months. The use of tablets as standalone or companion devices has a strong correlation with the user's job role.

Workers who perform all or the majority of their activities while in-transit, in the field, or facing customers are more likely to rely solely on their tablets. Also, production workers equipped with a tablet often use them as their only work device in 64 percent of cases. By comparison, only 38 percent of executives and 44 percent of white-collar employees work only on their tablets.

IDC believes that while the majority of enterprises still use the default tools that come with their computing devices, most IT leaders confirm their wish to move to a more integrated single approach. The management of multiple mobile device operating systems and associated apps also remains a challenge for half of the IT decision makers interviewed during this survey.

Your Quest for a Comprehensive Solution

The right foundations are crucial to help you get beyond a me-too approach and reinvigorate or even reinvent your business. You'll find the real value of enterprise mobility will be revealed as your software app deployments mature from lightweight and tactical to more involved, strategic and scalable use-cases.

Some software vendors, such as Red Hat, provide next generation, cloud-based mobile enterprise application solutions that simplify the development, deployment and management of mobile apps for the most demanding commercial requirements.

Moreover, these product offerings are complemented by professional services that enable CIOs and their IT organizations to quickly and securely launch new enterprise mobility capabilities.

Thursday, June 11, 2015

How to Accelerate Government IT with a DevOps Boost

The rapid adoption of digital business transformation processes and the ongoing deployment of open hybrid cloud platforms are enabling the achievement of software development bold goals. But when management consultants and industry analysts talk about how IT innovation is changing many organizations, government leadership of this key trend typically isn't top of mind.

That said, a new market study by MeriTalk reveals that approximately two-thirds of American federal government IT leaders say DevOps adoption will help agencies shift into the cloud computing fast lane.

Agile methodologies, continuous integration and continuous delivery are improving IT collaboration and migration speed. But according to the findings, help is required -- with 66 percent of leaders saying that their agency needs to move IT services to the cloud faster to meet their mission and constituent needs.

DevOps is a software development and IT management method that brings software engineering, quality assurance, and IT operations together as an integrated team to collaboratively manage the full application lifecycle. The MeriTalk study examined the cultural and structural barriers to cloud adoption, and potential positive impact from DevOps practices within a government environment.

"We've heard a lot about cloud barriers, and we've all seen the lackluster GAO cloud spending data," said Steve O'Keeffe, founder of MeriTalk. "This study highlights a viable path forward. DevOps can help agencies change lanes and shift from inefficient silos to a dynamic, collaborative environment. It’s about people and how they work together, as well as the technology they use.”

Perceived Benefits of DevOps Methodologies

There's real upside potential for DevOps adoption in government -- 57 percent of survey respondents believe DevOps can help agencies succeed in the cloud. Sixty-three percent say DevOps will speed software application delivery and migration.

Furthermore, 68 percent see DevOps as a viable path to improve collaboration between IT development, security, and operations teams. Federal IT leaders also anticipate faster application testing (62 percent) with a proven DevOps approach.

The online survey of over 150 U.S. Federal IT managers also found that they believe increasing their cloud adoption pace will boost innovation (70 percent) -- refresh existing applications and deploy new ones faster (69 percent); and provide more available, reliable, and secure operations (62 percent).

Barriers to Cloud Computing Service Deployment

While security and budget concerns remain top of mind within the leadership of government agencies, organization structure and cultural issues continue to slow the progress toward cloud computing service adoption.

Forty-two percent of IT leaders cite infrastructure complexity as a top challenge to adopting cloud, followed by fear of change (40 percent), inflexible practices (40 percent), and lack of a clear strategy (35 percent).

Some agencies are gaining momentum, but many are experiencing difficulties with the practical execution – since the introduction of cloud, just 44 percent of U.S. Federal agencies have made the required process or policy changes, 30 percent cultural changes, and 28 percent organizational changes.

Moreover, the study uncovered that these same Federal agencies aren’t properly equipped – only 12 percent believe that their IT department has all of the tools they need to transition to the cloud.

Four out of five IT managers (78 percent) believe their IT department needs to improve collaboration to enable a more streamlined move to the cloud. But, only 10 percent of Federal IT managers said that their software developers and administrators are highly collaborative.

Outlook for Meaningful and Substantive Progress

Among the IT managers that understand DevOps benefits, just five percent say their agency has fully deployed a DevOps model. However, 60 percent do see DevOps in their future. Thirty-two percent of government IT managers that are already familiar with DevOps had also adopted the model or planned to do so within the next twelve months.

So, what are the perceived next steps? In order to successfully implement a DevOps model, government IT managers say agencies should train their current personnel (55 percent); establish a new vision for the future (41 percent); and create an incentive for a much-needed change in organization culture (40 percent).

Wednesday, May 27, 2015

Innovation Accelerators Lead Business Transformation

More CEOs are setting bold IT innovation goals for their company. Meanwhile, CIOs are tasked to quickly build the required business technology infrastructure. What’s the primary motivation? The growing expectation that all leading organizations will achieve their key strategic business objectives via superior IT-enabled advancements.

In fact, a recent study found that 55 percent of survey respondents said their environment will be changed ‘significantly’ -- 20 percent actually said it will be ‘completely transformed.’ Such major transformations can lead to significant competitive advantages, as long as the IT goals are clearly articulated, according to the findings from a Harvard Business Review (HBR) market study and associated report that was sponsored by Red Hat, Inc.

The apparent benefits extend beyond the traditional commercial enterprise. For example, a $650 million innovation project at a large State Government agency is returning $4.7 billion in additional tax revenue – that’s a 7:1 return on investment – by deploying online self-service offerings and becoming more sophisticated in their use of taxpayer data.

The HBR survey respondents also said that IT-enabled innovation would change the way employees do their work (48 percent significantly changed; 15 percent completely transformed), the company’s products/services (46 percent changed; 11 percent transformed), and business models (42 percent changed; 13 percent transformed).

Why Some Organizations Surge Ahead of Peers

For the few “Innovation Accelerators” that lead their industry, the numbers are significantly higher. A case in point; 70 percent said their approach to customer engagement and insight would be significantly changed, and a full third say it would be completely transformed.

The HBR analyst and report author claims that this revelation is very important, and directly translates to the specific projects that these survey respondents expect to engage in over the next three years.

Innovation Accelerators Share Six Characteristics

  • Their commitment to technology-driven business innovation starts at the top, with the CEO.
  • Their approach to innovation is structured and managed -- but they value speed over perfection and cut through bureaucracy.
  • They value diversity of thought and experience, collaborating fluidly across functions, hierarchy, and traditional corporate boundaries.
  • Their CIOs are significantly more likely to spend their time on activities that are strategic to the business.
  • They have strong IT departments that actively and productively contribute to the corporate innovation agenda.
  • They are more likely to invest in and reward innovation.

According to the assessment performed by the HBR report authors, while these six traits can help build a road map for organizations seeking to harness IT for digital business transformation, there are a number of barriers to overcome.

The most common barriers to success include functional silos, rigid ideas about roles and responsibilities, calcified processes, outdated compensation structures, and technology infrastructures that were not designed to support the kinds of open and agile customer-engaging systems required today.

Detailed Profile of an Innovation Accelerator

Already, rapid developments in IT best practices are having a dramatic impact on all aspects of commerce. The HBR research suggests that organizations that make a strong commitment to IT-driven business innovation will accelerate their digital transformation in several key areas – such as, how they engage with and understand their customers, new business models, the development of new products or services, and how employees perform their work.

The HBR analysis has uncovered that these Innovation Accelerators are significantly ahead of their competitor’s IT innovation efforts – including the extent to which they have successfully commercialized internal IT initiatives.

The research also reveals that the Accelerator success begins with a commitment from the CEO that is shared by the company’s cross-functional leadership team. It includes taking a structured approach to ensure that innovation occurs throughout the organization without bogging it down.

Innovation Accelerators are inclusive, valuing the perspectives, knowledge, and ideas of diverse people and groups, both inside and outside the company. They have multifaceted CIOs who focus on business strategy and innovation -- plus, they identify opportunities for competitive differentiation.

They have IT departments that support new business ideas and opportunities with access to the best-fit technology, knowledge of the business, and the right technical skills. And, they proactively invest in and reward meaningful and substantive innovation.

In summary, HBR suggests that CIOs now have a strategic mandate to innovate. The ones who accelerate won’t wait for permission but will lead their organizations into what will likely be a very different, business technology-driven future.

They will be a key part of the CEO’s strategy execution team; designing the open, agile, and customer-engaged organization that will create new value and a distinctive competitive advantage that’s built upon a rock-solid digital business foundation.

Wednesday, April 29, 2015

Digital Transformation Drives Cloud Computing Demand

Digital  Business Transformation projects gained momentum in 2014, as more companies moved their legacy IT workloads to cloud computing platforms and launched a variety of new cloud-native applications. This pervasive trend will continue and accelerate for the duration of 2015.

Total cloud IT infrastructure investment (server, disk storage, and ethernet switch) is forecast to grow by 21 percent year-over-year to reach $32 billion in 2015 -- accounting for about 33 percent of all IT infrastructure spending this year, which will be up from about 28 percent in 2014.

Private cloud IT infrastructure spending will grow by 16 percent year-over-year to $12 billion, while public cloud IT infrastructure spending will grow by 25 percent in 2015 to $21 billion, according to the latest worldwide market study by International Data Corporation (IDC).

For the full year 2014, cloud IT infrastructure spending totaled $26.4 billion, up 18.7 percent year over year from $22.3 billion -- private cloud spending was just under $10.0 billion, up 20.7 percent year-over-year, while public cloud spending was $16.5 billion, up 17.5 percent year-over-year.

Regional and Worldwide Market Forecast

In 2015, Western Europe is expected to have the highest growth in cloud IT infrastructure spending at 32 percent, followed by Latin America (23 percent), Japan (22 percent), and the U.S. market (21 percent).

For the five-year forecast period, IDC now expects that cloud IT infrastructure spending will grow at a compound annual growth rate (CAGR) of 14 percent -- both public cloud and private cloud are expected to grow at the same CAGR.

By 2019, IDC also expects worldwide cloud IT infrastructure spending to be $52 billion, or 45 percent of total IT infrastructure spend -- public cloud will represent about $32 billion of that amount, and private cloud will account for the remaining $20 billion.

Given the current market development trajectory, this trend is unstoppable. It would be unwise for a legacy CIO to continue to deny the apparent benefits of cloud computing and thereby resist the Digital Business change that their more forward-thinking peers have already embraced.

Essential Role of Shadow IT and Open Source

"The pace of adoption of cloud-based platforms will not abate for quite some time, resulting in cloud IT infrastructure expansion continuing to outpace the growth of the overall IT infrastructure market for the foreseeable future," said Kuba Stolarski, research manager at IDC.

In many organizations, a key driver of the rapid adoption of cloud applications and DevOps practices continues to be the unstoppable "Shadow IT" phenomena -- where savvy Line of Business leadership refuses to be held back by the inherent limitations of their company's internal IT organization.

As the global market evolves into deploying more cloud-native solutions -- enabled by open source software, such as OpenStack -- IDC belives that organizations of all types and sizes will discover that traditional approaches to IT management will increasingly fall short of the simplicity, flexibility, and extensibility requirements that form the core of cloud computing solutions.

Monday, March 9, 2015

How to Reach Digital Business Goals with IT-as-a-Service

Senior executive expectations have been raised for traditional IT organizations that broker cloud computing services for their internal business stakeholders. Besides, there's a belief that the lack of dimension maturity can slow digital service innovation outcomes.

As a result, International Data Corporation (IDC) now predicts that by 2016, 65 percent of global competitive strategies will require real-time IT-as-a-Service (ITaaS) solutions.

The ability of CIOs and their  IT organizations to grasp how business wants cloud computing services that serve actual business needs -- not traditional IT components -- is significantly altering the ways in which service management is achieving success.

Quest for Competitive Strategic Advantage

New business technologies are fundamentally altering how IT organizations function, how business is conducted, and how enterprises compete in the marketplace. IDC believes that this environment requires IT to deliver services that are focused on realizing the highest-level strategic objectives.

The ability of IT to immediately achieve a maturing business focus within its strategic planning and execution process is a key imperative. In this latest study, IDC has explored a planning framework that enables CIOs to attain digital business transformation goals.

"Creating a mature, strategic business alignment between IT and its customers requires a clearly defined end-state vision, an empowering IT culture capable of initiating rapid change, and an increasing focus on the financial costs and benefits -- as measured from a consumption basis, versus the traditional cost-budget basis," said Bill Keyworth, vice president of research at IDC.

IDC also believes that a method of assessing service innovation maturity is needed as a planning tool to help prioritize and evaluate the progress of an IT organization rising to meet the progressive Line of Business leader demands.

Additional findings from the IDC study include:

Without question, maturing the IT business dimension requires the active participation of top IT management. It's equally important to ensure all stakeholders and beneficiaries of IT within the enterprise are kept abreast of the business dimension maturity process.

Moreover, IT service innovation demands a multifaceted approach that seeks to ensure that all five maturity dimensions are simultaneously addressed, continually focusing on the least mature process -- or, the bottleneck that's holding up all other maturity dimensions.

Rather than tackle IT business-facing objectives through massive project implementations, IDC recommends companies take a "theory of constraints" approach, frequently used within ITaaS to quickly identify, analyze, and resolve any impediment to IT-business alignment.

Furthermore, according to the IDC assessment, IT organizations that achieve long-term success will be characterized by a service-centric culture that tracks effectiveness through an outside-in perspective, rigorous IT competitive analysis, and business-oriented metrics.

Monday, February 9, 2015

The DevOps Path to Digital Transformation Nirvana

Back in 1982, many pundits in the business media were raving about the publication of "In Search of Excellence" – a book written by Tom Peters and Robert Waterman. As you may recall, the topic wasn't about the typical mainstream company of that time. Instead, it was about forty-three selected companies that were deemed to be “excellent” by the two authors.

Those companies were chosen to be profiled due to their superior organization and people processes. Today, it’s more likely for management consultants to write about business technology adoption – specifically, digital transformation and the role of DevOps practices within the evolving enterprise IT organization.

But is DevOps really a significant trend, or merely a fad? International Data Corporation (IDC) believes that DevOps will be adopted -- in either practice or discipline -- by 80% of Global 1000 organizations by 2019.

IDC released a summary the findings from their "2014 DevOps Benchmark Survey" which is designed to help organizations assess their maturity level against industry benchmarks. IDC believes that DevOps offers organizations an opportunity to transform how they develop, deploy, and manage IT services.

"One of the most revealing aspects of this benchmark research is that a growing number of IT organizations are using new automation and performance management tools across both the Development and Operations teams, and linking these projects through DevOps practices," said Stephen Elliot, vice president at IDC.

These organizations are delivering business value in the form of cost avoidance, while increasing the speed and quality of their customer impactful services. One of the biggest challenges, according to the IDC assessment, is actually getting started with native Cloud DevOps.

Open Minds, Empathy and Continuous Improvement

IDC believes that the benefit of DevOps is typically gained via process standardization, with an increased focus on teamwork across software development and IT operations teams. Moreover, it’s achieved when leaders are actively traversing internal organization silos and bringing cross-functional teams together – working towards a common goal.

Often, according to IDC, the existing IT organization culture is seen as a significant DevOps adoption barrier that can demotivate projects. Adopting a progressive IT culture of collaboration, teamwork, sharing, empathy, communication and trust are extremely important.

Software production quality metrics and the application of ongoing measurement are also important to achieve long-term improvement – enabling Line of Business leaders to achieve their business outcome objectives.

Organizations deploying enterprise mobility and cloud computing solutions in DevOps profit by driving tighter collaboration across key business stakeholders and development, test deployment, application support, and operations teams.

IDC also measured maturity across the five key dimensions: People, Culture, Technology, Business, and Process. According to the IDC study findings, several insights are particularly noteworthy:

  • Many organizations are still at the opportunistic stage for all five dimensions of DevOps maturity, with a minimal number of organizations at the ad hoc stage.
  • Overall, DevOps capabilities are consistent across the people, technology, and process dimensions.
  • Less than one-tenth (9.2 percent) of the survey respondents are at the optimized stage in the culture dimension, while more than twice that many (20.2 percent) are at the optimized stage in the business dimension.
  • Most IT organizations today have a better understanding and acceptance of the requirements and needs to achieve a desired state for business alignment, strategy execution, and budgeting than the relentless courage and risks required to drive cultural change.
  • Cultural transformation is at the heart of DevOps practices and a core impact point for achieving DevOps success.
  • This disparity is also reflected in over half (53.7 percent) of respondents indicating that they are at the opportunistic stage in the culture dimension, while the counterpart percentage for the business dimension is 41.7 percent.

For a more in-depth exploration of the potential upside of adopting a DevOps methodology, consider the wisdom of Gordon Haff. In a recent editorial he said "DevOps is fundamentally about adopting many of the same open source best practices. Agile. Transparency. Collaboration. Iterative fast release. Continuous integration. These come together and, over time, create an open source lifestyle and culture. They can likewise come together to make DevOps thrive."

Monday, December 29, 2014

Where Mobile Cloud is Driving the Greatest Value

How agile is your IT organization? Have you kept pace with the rapid evolution of cloud computing services? Have you applied that cloud investment to connect with your key stakeholders in the marketplace? Are you ready to seize the opportunities from the emerging mobile cloud trend?

If you answered NO to any of these questions, you're at a competitive disadvantage with your more digital savvy business technology peer group. The leading organizations worldwide will rely on cloud infrastructure to achieve commercial benefits that extend far beyond IT cost reduction goals.

Informed CEOs and other senior executives are realizing that cloud service adoption can be a much-needed catalyst for operational process improvement -- as well as a driver of business transformation.

New market data shows the increased use of cloud technology by global business to better connect with their employees and customers. According to findings from the KPMG 2014 Cloud Survey, the top use of cloud computing remains driving IT cost efficiency (49 percent).

However, the survey results also reveal that the progressive organizations are using cloud computing to enact large-scale change -- such as by better enabling a flexible and mobile workforce (42 percent), or improving alignment and interaction with customers, suppliers and business partners (37 percent).

Why Mobile Cloud has Gained Momentum

The enablement of a flexible and mobile workforce was cited as a driver of cloud usage by only 15 percent of executives in the KPMG 2012 Cloud Survey, whereas this result almost tripled in the 2014 survey -- with 42 percent of respondents citing it as part of their digital transformation methodology.

Additionally, according to the 2014 findings, executives cite increased employee productivity (54 percent) and higher employee satisfaction and flexibility (48 percent) as the top two benefits of using cloud services to improve workforce mobility.

"People's expectations as employees are a lot different than they were ten years ago," said Mark Shank, managing director of the digital and mobile practice at KPMG.

According to their assessment, employees today demand the same access, experience and richness on their work computers and mobile devices as they have on their personal devices. Cloud is making that possible, and organizations are using it to enable a more flexible and agile workforce.

Why Retailers are Leading the Transformation

Similarly, the cloud is being used to transform customer interactions, as the emergence of the digital-savvy customer calls for organizations to embrace new approaches and tools for communication with their customers and prospects.

This is especially true in the retail sector. Compared to other industries, retail executives in the 2014 survey were more likely to say their organizations are using cloud services to improve alignment and interaction with their customers, suppliers and business partners.

KPMG believes that empowered consumers expect more from their retail experience, and this adds pressure and uncertainty to traditional retailer business operating models. Consumers expect to be known, recognized, and offered personalized insight and offerings.

They want to interact with the brand in person, on-line, on the go -- and on their own terms. They also prefer ready access to knowledgeable and responsive associates across those various channels.

The pace and variability of change is driving the acceleration of cloud solutions to enable retailers to make the broad range of operational and business changes to remain competitive in this evolving consumer landscape.

How to Reach the Full Potential of Cloud DevOps

KPMG offered some tips to realize the long-term commercial benefits from cloud infrastructure deployment and the ongoing use of a DevOps approach to rapid software application development.

Adoption should not be viewed as just another technology implementation project, but rather a comprehensive digital service transformation journey spanning from initial strategy development through to the ongoing execution.

Cultural alignment through all levels of the IT developer and operations organization is essential to managing the change associated with a cloud transformation.

Executive management should work to establish an aligned corporate culture at the outset, focusing first on getting the buy-in and support of senior cross-functional business leaders.

Organizations should develop realistic and measurable business outcomes for their cloud transformation projects that tie back to key strategic objectives.

Meanwhile, a value- and metrics-driven approach to cloud transformation enables the organization to know when milestones are reached and stay focused on achieving their bold strategic goals.

Monday, December 15, 2014

Cloud Adoption Trend is Driven by Strategic Imperatives

As this year comes to a close, let's take one last look at the most pervasive cloud computing trends -- including increased usage across the different cloud service models, the key business drivers and the impact of agile innovation strategies.

Cloud computing adoption has matured, with 69 percent of survey respondents stating that at least a portion of their computing infrastructure is in the cloud. However, 56 percent of companies are still identifying IT operations that could potentially move to the cloud, according to the latest market study by IDG Enterprise.

Survey respondents believe that business technology is a game changer, and cloud solutions are providing advantages from increasing IT agility (63 percent), IT innovation (61 percent) and improving the ability to access critical business data and digital service applications (58 percent).

Removing the Barriers to Cloud Adoption

That said, IT leaders perspective on barriers to bringing these advantages to fruition differs from their Line of Business (LOB) counterparts. There is agreement, however, that a company's biggest challenge to implementing a cloud platform is ensuring security.

But there's a significant disconnect on the second most important barrier. IT leaders are concerned about integration (46 percent).  In contrast, LOB leaders believe measuring return-on-investment is a more important challenge (37 percent).

"As use of cloud solutions mature, more than half of companies surveyed are shifting from adoption to upgraded services," said Brian Glynn, chief revenue officer of IDG Enterprise. "This opens the door for new and existing solution providers as businesses continue to look for ways to improve agility and innovation while balancing enterprise security and risk."

Cloud Service Preferences are Evolving

Three-quarters of companies are confident that the assets they have placed in the cloud are secure. To help companies have a sense of control, 80 percent have already created, or will create, a governance policy in the next year.

Also, public cloud (60 percent) and private cloud (57 percent) solutions remain the preferred environments compared to hybrid cloud (19 percent). As more workloads move into the cloud, the amount of data stored in private and public clouds will each increase to 25 percent and 21 percent, respectively, in the next 18 months.

Since 2012, cloud investments have increased by 19 percent, with large enterprises spending on average $3.3 million a year, compared to SMBs spending $400,000. Moreover, spending on cloud solutions will account for almost a quarter of IT budgets in the coming year.

Cloud Deployment Motivation is Strategic

Current estimates show that 23 percent of spending on cloud solutions happens outside of the IT department -- with marketing, sales and human resources most often investing in solutions.

Besides, even when a cloud solution is purchased by LOB leaders, the IT team can still be involved in the management of the project. And, in instances where IT does not lead the project, 45 percent of the time IT is still called upon to take over the project.

No matter who initiates the move to cloud, one thing will always be certain, CEOs and other senior executives that approve the budget are not enamored by the technology -- they have a strategic imperative and they seek a meaningful competitive advantage in the marketplace.