(cc) Kevin Dooley

Evolving your business alongside cloud services – V3 writeup of my talk at Cloud Expo Yesterday

I gave a talk at Cloud Expo at the London Excel centre yesterday on the need for a much more dynamic perspective towards cloud computing. V3.co.uk have written an article providing an excellent summary of the talk if you are interested:
http://www.v3.co.uk/v3-uk/news/2454551/enterprises-must-be-ready-to-evolve-alongside-cloud-services

Dr Will Venters, assistant professor of information systems at the London School of Economics, explained that companies integrating cloud services into their IT infrastructure need to establish fluid partnerships with multiple vendors, as opposed to purchasing a static product….

Executive Training in Enterprise Outsourcing and Cloud Computing

I am teaching again on our one-week executive education course on Enterprise Outsourcing at the LSE, contributing  my Cloud Computing expertise into a wider course on Enterprise Outsourcing and Innovation. Join us if you are able! http://bit.ly/eRIlxZ

Managing the Outsourcing Enterprise: From Cost to Innovation and Cloud Services

Professor Leslie P. Willcocks 
Dr Edgar Whitley
Dr Will Venters
Professor Mary Lacity

Dates:  25 June – 29 June 2012
Fee: £4,650

Course Objectives

This course offers in-depth coverage of the key issues, developments and management challenges in today’s global sourcing marketplace. It provides a learning vehicle and tools , in terms of key frameworks, principles and practices, for those preparing themselves for general management  in major organizational functions or for more specific global sourcing roles, and also for experienced managers who wish to move to the next level. It  focuses on the needs of managers and senior executives working in client companies and service suppliers. It covers global sourcing, strategy, Information Technology outsourcing (ITO) and Business Process Outsourcing (BPO) including the most recent developments in sourcing and offshoring  for such major areas as HR, Finance and Accounting, Procurement, Legal and Knowledge (KPO) functions.

Benefits

  • Gain a thorough knowledge of effective management lessons and techniques to develop and implement sourcing strategy, operate as an informed buyer, select suppliers,  and manage and deliver outsourcing services from both client and supplier perspectives
  • Develop in-depth understanding of global trends in the sourcing marketplace and how sourcing fits with corporate competitive and collaborative strategies.
  • Draw on an unrivalled LSE Outsourcing Unit research base of over 1500 outsourcing arrangements in Asia Pacific, USA and Europe, and 20 years of publications and working papers on global sourcing trends, country and IT industry analyses, together with case histories of effective client and supplier practices.
  • Learn from up-to-the-minute case studies, negotiating exercises, guest executives and cutting edge research projects, including on bundled services, cloud computing, selective sourcing strategy, offshore locations..
  • Improve your ability to analyse sourcing challenges and questions and make more effective assessments and decisions
  • Develop your skills and marketability in increasingly key areas for contemporary organizations in a global context.

This course will address the following key topics

  • Global context and trends –offshoring, country attractiveness, key decisions
  • Moving To The Strategic Agenda – alignment, configuration, distinctive capabilities
  • Preparing For Outsourcing – 9-phase life-cycle, negotiation, selection, requisite supplier capabilties
  • Making The Transition – Contracts, HR and service challenges, change management, SLA and scorecards,
  • Managing Outsourcing – control, relationships, leveraging suppliers
  • Regeneration and Outsourcing Futures – options decisions case histories, trends to harness.

The course reader, especially prepared for this executive practitioner module is: Leslie Willcocks, Sara Cullen and Andrew Craig (2011) The Outsourcing Enterprise: From Cost Management To Collaborative Innovation (Palgrave, London

Our Fourth Report: Innovation: Cloud and the Future of Business: From Costs to Innovation –

Our fourth report on Cloud Computing is now available… This report looks at the future of business, mapping out the concept of the Cloud Corporation, and discusses the fragmentation and redevelopment of the technology supply industry. In particular we discuss how the industry may become layered and increasingly specialised – with organisations benefiting from the business agility and better alignment offered this will create.

Click on the image below for the full report.

Cloud and the Future of Business: From Costs to Innovation - Part Four: Innovation

Third Report – The Impact of Cloud Computing

The third report in our series for Accenture is now available by clicking the image below:

Cloud and the Future of Business: From Costs to Innovation - Part Three: Impact

 

 

In this report we consider the potential short and long term impact of Cloud Computing on stakeholders. Using our survey of over 1000 executives, and supported by qualitative interviews with key Cloud stakeholders, we assess this impact on organisational performance, outsourcing and the supply industry both in the short-term and long term.

Our 2nd Report: Meeting the challenges of cloud computing – Accenture Outlook

http://www.accenture.com/SiteCollectionDocuments/PDF/Accenture-Outlook-Meeting-the-challenges-of-cloud-computing.pdf

Our second Accenture report on Cloud Computing is about to be published!  As a taster the above link takes you to a short synopsis (Published in the Accenture Outlook Points of View series). I will post a link to the full report when it is out.

While in danger of providing a summary on a summary, this second report builds on our first “Promise of Cloud Computing”  report to analyse the challenges faced by a move to cloud. We identify the following key challenges:

Challenge #1: Safeguarding data security

Challenge #2: Managing the contractual relationship

Challenge #3: Dealing with lock-in

Challenge #4: Managing the cloud

Once you read the paper I would love to hear your views – please use the add comments link at the bottom of this section (its quite small!) or email me directly on w.venters@lse.ac.uk

I would also suggest you also review the whole report when it is out – much of the important detail is missing from this shorter synopses.

Cloud Computing – it’s so ‘80s.

For Vint Cerf[1], the father of the internet, Cloud Computing represents a return to the days of the mainframe where service-bureaus rented their machines by the hour to companies who used them for payroll and other similar tasks. Such comparisons focus on the architectural similarities between centralised mainframes and Cloud computing – cheaply connecting to an expensive resource “as a service” through a network. But cloud is more about the provision of “low-cost” computing (albeit in bulk through data-centres) at even lower costs in the cloud. A better analogy that the mainframe then is the introduction of the humble micro-computer and the revolution it brought to corporate computing in the early 1980s.

When micros were launched many companies operated using mini or mainframe computers which were cumbersome, expensive and needed specialist IT staff to manage them[1]. Like Cloud Computing today, when compared with these existing computers the new micros offered ease of use, low cost and apparently low risk which appealed to business executives seeking to cut costs, or SMEs unable to afford mini’s or mainframes[2]. Usage exploded and in the period from the launch of the IBM PC in 1981 to 1984 the proportion of companies using PCs increased dramatically from 8% to 100% [3] as the cost and opportunity of the micro became apparent. Again, as with the cloud[4], these micros were marketed directly to business executives rather than IT staff, and were accompanied by a narrative that they would enable companies to dispense of heavy mainframes and the IT department for many tasks –doing them quicker and more effectively. Surveys from that time suggested accessibility, speed of implementation, response-time, independence and self-development were the major advantage of the PC over the mainframe[5] –  easily recognisable in the hyperbole surrounding cloud services today. Indeed Nicholas Carr’s current pronouncement of the End of Corporate IT[6] would probably have resonated well in the early 1980s when the micro looked set to replace the need for corporate IT. Indeed in 1980 over half the companies in a sample claimed no IT department involvement in the acquisition of PCs[3].

But problems emerged from the wholesale uncontrolled adoption of the Micro, and by 1984 only 2% of those sampled did not involve the IT department in PC acquisition[3]. The proliferation of PCs meant that in 1980 as many as 32% of IT managers were unable to estimate the proportion of PC within their company[3], and few could provide any useful support for those who had purchased them.

Micros ultimately proved cheap individually but expensive on-mass[2] as their use exploded and new applications for them were discovered. In addition to the increased use IT professionals worried about the lack of documentation (and thus poor opportunity for maintenance), poor data management strategies, and security issues[7]. New applications proved incompatible with others (“the time-bomb of incompatibility”[2]), and different system platforms (e.g. CP/M, UNIX, MS-DOS, OS/2, Atari, Apple …) led to redundancy and communication difficulties between services and to the failure of many apparently unstoppable software providers –household names such as Lotus, Digital-Research, WordStar and Visi and dBase[8].

Ultimately it was the IT department which brought sense to these machines and began to connect them together for useful work using compatible applications – with the emergence of companies such as Novell and Microsoft to bring order to the chaos[8].

Drawing lessons from this history for Cloud Computing are useful. The strategic involvement of IT services departments is clearly required. Such involvement should focus not on the current cost-saving benefits of the cloud, but on the strategic management of a potentially escalating use of Cloud services within the firm. IT services must get involved in the narrative surrounding the cloud – ensuring their message is neither overly negative (and thus appearing to have a vested interest in the status quo) nor overly optimistic as potential problems exist. Either way the lessons of the microcomputer are relevant again today.  Indeed Keen and Woodman argued in 1984 that companies needed the following four strategies for the Micro:

1)      “Coordination rather than control of the introduction.

2)      Focusing on the longer-term technical architecture for the company’s overall computing resources, with personal computers as one component.

3)      Defining codes for good practice that adapt the proven disciplines of the [IT industry] into the new context.

4)      Emphasis on systematic business justification, even of the ‘soft’ and unquantifiable benefits that are often a major incentive for and payoff of using personal computers” [2]

It would be wise for companies contemplating a move to the cloud to consider this advice carefully – replacing personal-computer with Cloud-computing throughout.

(c)2011 Will Venters, London School of Economics. 

[1]            P. Ceruzzi, A History of Modern Computing. Cambridge,MA: MIT Press, 2002.

[2]            P. G. W. Keen and L. Woodman, “What to do with all those micros: First make them part of the team,” Harvard Business Review, vol. 62, pp. 142-150, 1984.

[3]            T. Guimaraes and V. Ramanujam, “Personal Computing Trends and Problems: An Empirical Study,” MIS Quarterly, vol. 10, pp. 179-187, 1986.

[4]            M. Benioff and C. Adler, Behind the Cloud – the untold story of how salesforce.com went from idea to billion-dollar company and revolutionized and industry. San Francisco,CA: Jossey-Bass, 2009.

[5]           D. Lee, “Usage Patterns and Sources of Assitance for Personal Computer Users,” MIS Quarterly, vol. 10, pp. 313-325, 1986.

[6]            N. Carr, “The End of Corporate Computing,” MIT Sloan Management Review, vol. 46, pp. 67-73, 2005.

[7]            D. Benson, “A field study of End User Computing: Findings and Issues,” MIS Quarterly, vol. 7, pp. 35-45, 1983.

[8]            M. Campbell-Kelly, From Airline Reservations to Sonic the Hedgehog: A history of the software industry. Cambridge,MA: MIT Press, 2003.