Category Archives: Information technology

VMUG’s Inaugural Virtual Event

Did you register and attend the recent VMUG Virtual event? If you did not, you missed out on a great event with high quality content from VMware and its partners.

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To recap, the VMware User Group (VMUG) held its inaugural virtual event on January 21, 2014. The keynote, “The Grand Challenge: Simplifying IT to Unleash Innovation” was presented by Paul Strong, CTO at VMware. In addition, there were many sessions from VMware, partners, Hands-On Labs, vBrownBag sessions, an Exhibit Hall with over 20 vendor booths.

The event was a huge success, with over 8,300 registrations and 4,100 attendees. These numbers significantly exceeded expectations for the first ever virtual event. Attendees patiently waited for a representative to chat with them at booths, streamed a lot of content, attended multiple sessions, and spent time at the community lounge. The average time spent by each attendee at this event was over 4 hours, demonstrating the value of the content. Event sponsors had a lot of positive feedback regarding the quality of the event and the value they received.

 

VMUG Staff

An event such as this takes a lot of effort to plan and deliver, and I wish to recognize the efforts of the staff at VMUG HQ (pictured above), the leaders of this event, and the VMware staff responsible for coordination. I would like to thank all the speakers and participants from VMware and VMware partners as well. There were no technical glitches in spite of the huge turnout. Well Done!

Lastly, in case you registered, but could not attend, or wish to download content from this event, please note that your access is valid until the end of this month. You have a great opportunity to utilize some valuable content.

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Impact of Emerging IT Trends – An IT Leader’s View

During October 2013, I had the opportunity to speak with IT leaders at major technology companies about topics of current interest, such as IT Transformation and Cloud Computing. While I was interested in getting their thoughts and insights on how businesses are impacted by these forces, I was also curious on how they are dealing with the impact upon their organizations.

One of these leaders, Paul Chapman, is the VP of Global Infrastructure and Cloud Operations at VMware. He runs the Global Infrastructure and Cloud Ops Organization within VMware, primarily focused upon running internal infrastructure, networks, datacenters, compute, the internal private cloud, and the traditional IT services.

Paul felt that the Cloud is greatly changing how businesses invest in and consume technologies. Systems and processes that are not core to the business are easy candidates to move to the Cloud. He thought that IT departments should provide innovative services to the business. The key benefit to the organization would be agility, which is essential in today’s dynamic environment.

There were many other takeaways and suggestions from Paul that I felt were beneficial to me. The complete transcript of this insightful conversation can be viewed here.

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The Evolution of Cloud Computing

What is Cloud computing?

Cloud Computing is massive amounts of computing capacity that is available to users as a service, on demand, elastic and scalable, charged based on actual resource usage, and completely managed by the Cloud service provider. Users only need a computer to connect to and use the service. The official NIST definition of Cloud Computing can be accessed here.

Several major developments over the past few years have made this model of computing not only acceptable, but also highly preferred by companies. There are many advantages with this model, and some concerns and risks as well. I will focus primarily upon the public cloud for the rest of this post.

What has been the impact of Cloud Computing?

  1. Lower costs of technology deployment due to sharing of large-scale capacity acquired by the Cloud service provider at wholesale prices.
  2. Conversion of fixed costs to variable costs makes it much more appealing to CFOs and business leaders.
  3. Rapid scale-up and scale-down is possible, and this greatly improves agility of the business. It makes it suited for highly variable or periodic workloads.
  4. Simplicity of the cloud model to deploy/manage makes it easy for shadow IT or developers to manage. The business side is understanding technology better and moving towards mastering it.
  5. A personal experience for me was the boom in IT spending by dotcoms in the late 1990s, which created a huge demand for system and network administrators. IT professionals were among the early hires in most of those startups, since they needed to design and build the systems for Engineering. In contrast, with XaaS being simple to deploy and use today, and the emergence of the DevOps trend, IT staff is among the last to be hired in today’s startups.
  6. There has been a gradual reduction in the size and importance of the IT department, with increased scrutiny on IT spending.

I discussed these issues in depth with the following IT executives to see how their strategy had changed due to the emergence of Cloud Computing.

Bask Iyer: Bask is the CIO at Juniper Networks, responsible for IT, but also for Business and Technology Operations. He has over 25 years of experience, with IT leadership roles at Fortune 50 companies, such as Johnson and Johnson, Glaxo, and Honeywell.

Paul Chapman: Paul is the VP of Global Infrastructure at VMware. He runs the Global Infrastructure and Cloud Ops Organization within VMware, primarily focused upon running internal infrastructure, networks, datacenters, compute, the internal private cloud, and all the traditional IT services.

Mark Settle: Mark is the Chief Information Officer at BMC Software, with responsibility for applications and Business Operations. He has been a CIO at companies within various industries, such as Oil & Gas, Financial services, Consumer products, and Hitech distribution.

Here is what they had to say about the impact of Cloud Computing.

Organizations should seriously consider moving to the Cloud, felt Bask, “If good, cheap and reliable computing is available, you’d be crazy to build out your own datacenters”. On the importance of staying with your core competency, Paul stated, “We don’t win in the marketplace because we have the best HR or SFA processes”.  According to Mark, it pays to keep looking for opportunities to move applications to the Cloud, “We constantly look at our product portfolio to determine if there are other products that lend themselves to being offered in a SaaS kind of format”.

There are hurdles in moving to the Cloud, Paul said, “I think you have to have the platform, capabilities and applications in order to be able to move”. Mark thinks that Cloud adoption will happen application by application. He states that he never heard anyone say, “My strategy over the next few years is to decommission one-quarter of my installed base and switch everything over to Rackspace. I think what happens is that people find individual use cases, where to use the Cloud”. The advantages outweighed risks, according to Bask, “(The) cloud provides significant advantages—speed and agility—when combined are more valuable than cost”.

Security phobias can limit Cloud adoption for some companies, but as Mark says, “Your customer information is in the Cloud (SalesForce), and your employee SSNs are in ADP, so what (assets) are people fussing about?” Bask thinks that Cloud adoption actually helps IT departments and the business, “When Enterprise IT departments embrace Cloud, they will free up resources to focus more on delivering business value fast”. Paul thinks that rapid pace of technology evolution will continue, “Constant change is the new steady state”. More of their thoughts can be viewed here.

Conclusions

Cloud Computing is real and has been here for quite some time already. All of us are using Cloud based services on a daily basis, from email to social networking to mobile applications. Businesses are increasingly using the Cloud for Business applications. How will Cloud Computing play out over the next few years?

I think the following will happen over the next few years.

  • Cloud services will become much more commonly used, both by consumers and businesses. Most businesses will eliminate or drastically shrink their datacenters.
  • Costs will continue to decrease for Cloud services, with enhanced features offered by various vendors.
  • There is going to be a huge shakeout within the Cloud service provider industry, and only a few players will survive.
  • Enterprise Software vendors will face significant threats from Cloud-hosted competitors. Most of these vendors will fail to transform, and shrink, be acquired, or fail.
  • IT organizations will move up the value chain by focusing on increasing the agility of business, and supporting Business Transformation.

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Transformation and the future of the IT Organization – Part 2

In Part 1 of this post, I examined the various forces that drove the development of technology and computers, and how this gave rise to the IT department to manage this for the enterprise. The IT department has established itself within businesses, but is now subject to financial and performance standards like other organizational functions. If the business does not perceive commensurate value for costs incurred in supporting the IT department, what does the future hold for corporate IT organizations?  I spoke with the following executives to get insights into some of these issues.

Paul Chapman: Paul is the VP of Global Infrastructure at VMware. He runs the Global Infrastructure and Cloud Ops Organization within VMware, primarily focused upon running internal infrastructure, networks, datacenters, compute, the internal private cloud, and all the traditional IT services.

Mark Settle: Mark is the Chief Information Officer at BMC Software, with responsibility for applications and Business Operations. He has been a CIO at companies within various industries, such as Oil & Gas, Financial services, Consumer products, and Hitech distribution.

I discussed a number of topics with them, including the current state of the IT function within their companies, and the industry in general. What are the transformational forces driving IT and what are its effects?  How would the future IT organization be, and what would it need to do to thrive? Most of all, I wanted their opinion on the role of innovation within IT, and its value to the business. I have listed some of their insights on various topics from our conversation below.

On IT Transformation

Mark “There is always a wave of transformation sweeping through the IT industry, and some of the (traditional IT) construction skills are getting commoditized”.

Paul “I think that there has always been a notion of IT transformation; it is more a movement than transformation. Transformation has a real and defined start and end; there is a movement to IT as a Service”.

Mark “We have an assembly line model kind of concept, which is unfortunately prevailing in IT, where we have highly specialized jobs that need to be performed in a certain sequence to deliver service to the ultimate customer”.

Value for IT

Paul “I think the key is that you understand the new roles that are starting to emerge”.

Mark “The value for IT always gets generated really from interaction with the business”.

Paul “All the complexity that had been holding IT back is being solved. The challenge now has shifted from technology to the organization itself, it is about change management, about adopting and embracing the service model”.

Mark “They (IT organizations) know how to cut costs, they know all the stones to turn over, and they have become quite good at doing it, so they are asked to do it every budget cycle”.

Paul “IT is no longer able to hide behind the complexity (of technology)”.

Role of Innovation

Paul “Absolutely, IT organizations need to innovate (to provide value to the business)”.

Mark “If the SaaS providers start to displace the development activities, and the IaaS providers disrupt the extension of the datacenter, the only kind of equity that IT delivers is the data”.

Paul “By focusing on agility, we have freed up resources, and dollars to focus on innovation activities without necessarily increasing the overall IT budget”.

Future IT organization

Paul “We are seeing less demand for people that manage storage, people that manage compute, and people that keep the lights on in an infrastructure role”.

Mark “The IT organization of the future, (needs to) focus in moving to the value boundary with the business”.

Paul “IT professionals are always on a continuum of always needing to reinvent themselves, because of technology change. I think constant change is the new steady state”.

Mark “Figure out where you are within the commoditization wave, try to swim upstream, to get to wherever the maximum value gets generated, which is typically in direct interaction with the business”.

Read more of their insights from my conversations here.

In my opinion, IT needs to innovate for the business, providing Points of Differentiation. After one player within an industry demonstrates improved business due to an innovation, competitors quickly catch up to the leader. However, not catching up will become a competitive disadvantage. As Mark stated, “(IT) is kind of a force multiplier that goes out and finds solutions that makes groups more productive, at a personal level, or as a group, and helps in supporting the business”. Providing a steady stream of innovation is the crucial advantage that an IT organization can provide to the business.

Technology has become simpler to setup and use, and processes will simplify as well. The organizational cost focus has already afflicted IT departments, and the only manner that IT organizations survive is by providing a strategic edge to the business, like every other function within the company. As Paul summarized, “an IT organization that is very low in terms of innovation output, then by default, you have greater scrutiny of your IT budget”.

I think that IT Transformation this time has to focus upon the actual needs of the business – agility, simplicity, and cost. In addition, it has to deliver tangible value to the bottomline of the organization.

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Transformation and the future of the IT Organization – Part 1

Transformation is a buzzword within the industry, since it gets companies to spend large amounts of money. It is welcomed by some and feared by others, but this term is overused to a large extent. What does transformation mean to Information Technology (IT) organizations today?

Where we are

Today’s IT organization grew from automation of the industry, from within humble EDP departments that ran reports for management. This developed into MIS and the PC revolution kicked in. Automation and reliance upon computers for all tasks increased. While this increased worker productivity, investments in IT are now leading to diminishing returns.

Evolution of computing technology

Moore’s Law has had its relentless impact upon the technology industry, driving up performance of computers while driving down costs. Enterprise applications such as Email, ERP, and complex client-server applications were implemented by IT to demonstrate value. In the face of resistance from the business to maintain IT spending during recent downturns, there has been a push to establish metrics to demonstrate the efficacy of the IT organization. We are at a tipping point where personnel costs exceed capital costs, drawing greater scrutiny to the productivity of IT staff. However, each of these “transformations” within the IT organization has not affected how users worked, or their perception of IT.

Some possibilities:

  1.  This was only a change, not transformation.
  2. If it was a real transformation, it did not help the business much. IT was focused on providing a technology solution that improved efficiency, but also needs to be effective.
  3. IT tracks its own KPIs; it does not track the business KPIs, or how it moves the needle on them.
  4. IT is slowly losing credibility with the business.

What has changed now?

  1. IT is increasingly perceived as a barrier than an enabler due to its slow pace.
  2. The business is getting more technology savvy, thanks to the evolution of consumer focused technologies and products.
  3. SaaS offerings are point solutions that the business can easily implement without IT, and at a much lower cost. The phenomenon of “Rogue IT” is fairly recent, but its impact is already visible.
  4. The business realizes that agility is crucial for success in today’s environment. There are compelling economic reasons for businesses to be agile, as seen here.

These are some of the forces facing IT today. There is a pressing need for “real” transformation of the IT organization. How does the IT function transform, what will the future organization look like, and what will it need to do in order to provide value? We will hear industry leaders weigh in on this topic in my next post.

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