Why Cloud spells C.o.m.p.e.t.i.t.i.o.n. for the average IT department

This blog was originally posted at ITSMportal by columnist Gregor Petri on April 19th, 2010

Competition seems to be a controversial topic for many in IT. We rather see ourselves as service providers, but typically as the only - or at least the preferred - service provider. The reason to start this new column series on 'The impact of cloud computing on IT service management' with this controversial topic is that there seem to be two independent train of thoughts around cloud computing. On the one hand cloud computing is seen as a way to make traditional IT more efficient, on the other it is seen as a way for users to source IT solutions directly. The first group talks about Infrastructure as a Service and private clouds, while the second talks less but rapidly implements Software as a Service solutions, often bypassing the IT department in the process. Both groups are implementing cloud computing, but from very different starting points. Somehow they need to start talking again; otherwise we either get ‘strangers passing in the night’ or ‘a train wreck waiting to happen’.

For the first time in its history IT is facing outside competition. Sure, outsourcing was no picnic, but outsourcing was more like subcontracting to a ‘friendly’ supplier than real competition. With cloud computing users can simply go outside to procure the services they need. I am currently watching an interesting example close by. While the internal IT department is scrambling to offer an in-house social media type collaboration environment, one user department already went outside. To protect the innocent we won’t mention whether this was a production, sales, marketing, R&D or other department, but you get the idea. Starting in Australia, furthest away from corporate headquarters - both in distance and time-zones - they set up a collaboration environment with an outside cloud provider. In just a few weeks every member of this global department started sharing their activities, thoughts, projects and enjoying the typical communication that people enjoy on social networks.

As this cloud service is low cost (even starting with free), easy to use and it offers anywhere, anytime access also from non HQ supported devices such as iPhones and home PCs, the chances of IT winning this department back for their corporate service are dim at best. One good soul tried to help IT by requesting a similar online watering hole from corporate IT. As instructed he filled out a service request form at the central service desk , but to date he is still awaiting the first response from IT (a first response likely to be questions about priorities, about what executive will sign this off and what cost center it needs to be charged to). Now this may not be a mission critical enterprise system, but similarly we see user departments contracting directly with system integrators to build new enterprise solutions on a PaaS platform. My point is that many IT departments still seem to be in denial on the realities of this new competitive world called cloud. Time for a wake-up call.

Now IT is not the first department in corporate history to face some serious competition. Here is a wake-up analogy from the consumer electronics industry (if you’re not big on analogies, just substitute 'application' for 'TV and 'IT' for 'factory' and 'cloud' for Japan). About two decades ago a company from my country was global market leader in color TVs. Back then the average life cycle of a TV, before a new model would arrive, was 3.5 years. The average price was fairly stable at around 800 Euro’s and basically all components were custom designed and produced in house. Becoming the head of a TV factory was the ultimate career dream for many in my home town. Just a few years later, after Japan and Korea entered the global market, prices had dropped by 40% (and continued halving every two years), new models replaced old ones every 6 months and innovations such as remote controls, stereo, PiP and c-text determined market leadership. Our local multinational nearly did not make it through this transition. To cope they introduced 'just in time”, 'total quality' and started 'design for manufacturing', heavily utilizing standard off the shelf components to accommodate the much shorter life cycles. And to top things off they stopped producing the main component (CRT’s) in house, instead they created a production joint venture (a.k.a. a 'cloud') with their biggest competitor.

Overnight the head of manufacturing had to change from being ‘the king of low cost production’ to ‘the fastest orchestrator of the supply chain’. Agility became the word. But agility did not replace the need for low cost, high quality or advanced innovation. It was about delivering all of those at the same time and at neck break speed. Some industries decided this was just too hard and stopped in-house manufacturing all together, others saw it as an opportunity for differentiation. In my view the above analogy graphically illustrates the roller coaster ride IT is about to get on.

Many of the needed skills and tools, such as smarter sourcing, resource pooling, and service oriented architectures; we have already been trialing in the past few years. Under the banner of agile development we even have had a first go at coping with rapid change, despite the overwhelming complexity of enterprise IT. In addition there are many manufacturing best practices, Lean being the obvious one, that IT can benefit from (see also 'How lean is your cloud').

The question in my view is: is IT ready and willing to give up their manufacturing role (provider of services) and transition into an orchestration/supply chain role. Essentially engaging in both mentioned conversations: making enterprise IT more efficient, while at the same time enabling the enterprise to leverage readymade market/cloud services. Interested in your thoughts and comments.

The Cloud leans back – an iPad epiphany

Given the giant cloud of volcanic dust currently passing over Europe I could have also titled this blog "The cloud strikes back", but that is not the topic of this "the cloud changes everything" blog.  It also has nothing to do with my earlier topics on Lean IT and Lean manufacturing. Lean Back and Lean Forward were the guiding principles for developers of Interactive Television.

The idea being that TV is typically enjoyed leaning back, while computers are typically used leaning forward. Of course we all know that interactive television so far has been as successful as the NEXT computer (not). In fact, in the last 5 years we moved to a situation where more and more entertainment content is consumed leaning forward . If you visit our home on a typical Friday night the big ass TV may be on, but meanwhile all family members are hammering away on computers. Mom on the desktop, the kids fighting over who gets the macbook versus the laptop and Dad on his company supplied artifact.

Now only a few years ago, you assumed that any person using a computer was probably working. (back then only dad would be using his computer on a Friday night). One of the first I saw point out this blurring of work, home and play - as illustrated below -  was IT visionair Peter Hinssen (t) , in one of his hilarious but at the same time highly educational sessions on IT strategy.

However, something felt wrong about this. Maybe it is a generation thing, but if the above is your life, then how much of a life is it?

Luckily help has arrived, but not from interactive TVs.  If a family of 4 can barely agree what TV channel is to provide the background noise to their computing activities, how would they agree on one joint interactive activity. This new reality was vividly described by Robin Bloor , one of the first industry analyst and author of havemacwillblog.com.  In how  "The iPad Will Replace The Laptop" he describes numerous use cases of how "lean forward" is no longer needed to have a good and/or productive time online. If you're a person dying to get an iPad (like most of us in Europe) but also if you interested in the future of TV or indeed ... in the future of the cloud ... then this is a must read story.

Important to realize is that this is NOT about switching devices, but about a  fundamentally different way to interact with content and functionality (a.k.a. with the cloud).  People are interested in taking a ride, not in the art of motor cycle management or ownership. And that is exactly what the cloud brings. In fact, Google referenced the same phenomena when launching their latest incarnation of Google Docs. They stated that about as many people should need an office suite as need photoshop, autocad or similar. Most people read or at best annotate, only very few create. 

In this light, the decision of the Library of Congress to preserve the first billion tweets for prosperity (including interesting twitbits "like what did Dave or Joe or Bob  have for Lunch on Monday Aprill 11^th" may not be so stupid after all. The "we are all authors" movement may turn out to have been an one-time phenomena caused by temporary ubiquity of keyboards. Let's face it, writing 2500 tweets for 7 followers is not a fulfilling, economic or even sensible activity, let alone reading them (if you don't believe me have a try). Similarly we may realize that the volume of email we all complain about , is because we all spend too much time typing and not enough time reading. 

I think we can all agree Apple already changed the computer industry several times and is revolutionizing the music industry. With the iPad they will now be changing the TV industry (Apple TV was not a failure, it is just infrastructure for the iPad)  and by leaving out a keyboard they now also created the ultimate work, home and play "cloud consumption experience".  

This may mean that we are going back to an time where people using PCs are not just the ones working .  They are likely to be the ones creating cloud stuff: content creators and functionality developers (a.k.a . IT folks).  All other people - working, relaxing  and playing - will be doing so on cloud consumption devices.

Case in point, from a tweet by Cap Gemini's CTO Ron Tolido: "Need to run a country? We have an app for that" that points to Norway's prime minister running the country from his iPad while stranded due to the aforementioned volcanic cloud.  So lean back (or lean forward - depending on your job area) and enjoy the ride.

PS Some of you may point out that for that for the above to work, it would be a good idea if Google Docs actually worked on the ipod . In typically IT fashion we would call this an "implementation detail", but feel free to point it out to Google, preferably before I get a chance to pick up my iPad from Europe.

Note: I could not find the original author or copyright holder of the Modern Life cartoon, any pointers appreciated.

A cloud experiment @ ComputerTotaal!

ENGLISH: Started my one-time guest editorship of ComputerTotaal!, by far Holland’s largest monthly IT magazine. Goal is to make the summer edition (#8) one of the world’s first and largest experiments in cloud collaboration.

Lead by 5 guest editors, reviewed by an editorial board of several hundred and with potential contributions from the 100K+ readership, the content of this edition is to be created and reviewed in, on and through the cloud.

One of the aspects to be evaluated are the collaboration possibilities that Office 2010 and Microsoft’s consumer cloud platform such as SkyDrive are to deliver. But also alternatives like Google Apps and other SaaS options will be reviewed. Social cloud aspects reviewed include the blurring of work, play and home activities.

Interesting is that although this is clearly an experiment, which even uses a beta (office2010) to create the content, the over hundred thousand strong paying readership and the numerous advertisers of the magazine http://idg.nl/producten/1/computer-totaal/ do rightfully expect the quality to be at least on par with traditional methods. Very much like we see in today's “enterprise cloud experiments".

DUTCH: Vandaag begonnen als gast redacteur voor de zomer editie van ComputerTotaal!, Nederlands grootste IT en PC magazine.

De creatie van deze zomer editie (# 8) is volgens mij een van de eerste en grootste cloud samenwerkings experimenten in de wereld. Aangevoerd door een team van 5 gastredacteuren, bewaakt door een redactieraad van meer dan honderd en met potentiële bijdragen van de honderd duizend lezers, wordt de inhoud van deze uitgave in, op en door de cloud gecreëerd. Idee is om the beoordelen of een dergelijke samenwerking mogelijk gemaakt kan worden door nieuwe platformen zoals Office 2010 in samenwerking met Microsoft consument cloud platform: Skydrive. Maar ook alternatieven, zoals Google Apps en andere SaaS-opties worden bekeken. Daarnaast word aandacht besteed aan mede door de cloud veroorzakkte of ten minste mogelijk gemaakte vervaging tussen traditionele werk, spel en thuis activiteiten.

Interessant is dat hoewel dit duidelijk een experiment is, dat zelfs gebruik maakt van een beta release (office2010) voor het creëren van de inhoud, de meer dan honderdduizend betalende lezers en de vele adverteerders terecht verwachten dat de kwaliteit van dit nummer beter of tenminste gelijk moet zijn aan de traditionele nummers. Ook daar lijkt het dus erg op de "enterprise cloud experimenten" die hier vaak beschreven worden.

Wilt u de voortgang volgen op Twitter, zoek dan op hastags #computertotaal AND #office2010 http://twitter.com/#search?q=%23computertotaal%20%23office2010