ICT Modernisation

Conclusion: The COVID-19 pandemic has resulted in prolonged lockdowns and quarantines, limiting economic activity and resulting in closure of businesses and many people losing their jobs. Various institutions around the world are unanimous in predicting that a recession is on its way, if not already here. Unless a vaccine is developed in the immediate future, the uncertainty will continue to rise in the days and months to come. However, businesses can turn this situation into an opportunity to examine their current operations.

A review of the events of the recent global recession – the global financial crisis of 2007–2008 – reveals that six recession-seeded trends, when acted upon promptly, provided business advantage. Although the trends for the anticipated COVID-19-led recession are still to be established, CIOs can benefit from re-examining the lessons of the past recessions and exploring a recession’s potential to deliver organisational efficiencies and savings. The outcome may be selective adoption of technology or deferral of projects, but the potency of these trends cannot be ignored.

IBRS was asked to present on the AI market for 2018 - 2019. This advisory presents an AI market overview for this time with an outlook towards 2025. How has your organisation's AI journey progressed?

Conclusion: The recent use of artificial intelligence (AI) solutions has demonstrated the value of this type of technology to consumers and organisations. It resulted in the recent discovery of new antibiotics, the emergence of self-services (e. g. virtual agents) and the ability to analyse unstructured data to create business value. However, releasing AI solutions without integrating them into the current IT production environment, the corporate network and Cloud will limit the value realisation of artificial intelligence deployments.

NewsIBRS advisor Dr Joseph Sweeney has been tracking the three major Cloud vendors capabilities in AI and said Google is right to believe it has an edge over AWS and Microsoft when it comes to corpus (the data that 'feeds' certain AI applications) and also in AI application infrastructure cost and performance. However, he said this advantage was not materialising into significant gains in the Australian market.

Full Story.

Conclusion: Digital transformation is more than another software development stream to replace legacy systems by mobile applications. Digital transformation includes building a new IT capability that can improve the business bottom line. It requires increasing business performance, reducing the cost of doing business and mitigating business risks in a cost-effective manner. To support digital transformation, IT value management capabilities should be established on the following building blocks:

  • Value creation – Define and create the desired IT value needed by business lines. The IT value is a combination of services and technologies capabilities.
  • Value measurement – Measure the IT value contribution to digital transformation.
  • Value communication – Communicate the IT value contribution to business stakeholders, ensure that their expectations are met and re-adjusted (if needed) to address the business and market emerging imperatives.

Conclusion: IT organisations wishing to migrate to Cloud should adopt a pragmatic approach that strikes a balance between migration cost, Cloud risks and benefits. The bottom line is to avoid the hidden cost (e.g. scope changes), mitigate the migration risks (e.g. effective multi-Cloud management) and realise the benefits that contribute to business performance improvement. Effective governance of the overall Cloud migration is a critical success factor.

Conclusion: In this day and age, customers expect to be able to complete a transaction across multiple touch points and for each touch point to be aware of where they are in the transaction process, and complete the transaction in real time. That is, not having to wait for batch processing or human interaction to be completed before they see a result. To achieve a great customer experience in the digital world, organisations need to build IT systems that support their business processes, allowing customers choice of channel, including the traditional face-to-face and asymmetric processes, like paper and email.

The value proposition for the customer is for the supplier to provide an automated online service that is, from the customer’s perspective, fast, reliable, inter-connected and secure. The improved omni-channel approach will drive customer adoption and allow reduced costs associated with the continued face-to-face and asymmetric channels.

Related Articles:

"Contact centre trends update in 2019/2020" IBRS, 2019-11-02 01:33:22

Conclusion: IT organisations challenged with predicting performance requirements of new digital applications should undertake end-to-end stress tests that can detect systems performance problems prior to production release. Test results should be used to define the final release dates, prepare corporate investment justifications for improving the application architecture and influence the ongoing capacity planning practices. Successful execution of the initial performance engineering exercises will result in sound deployment strategies and avoid media embarrassment. The specification of the stress tests should be clearly described in any request for proposals. The chosen vendors should have the capability to scale the new systems to the desired performance specification.

Conclusion: Delivering mature infrastructure services depends on many factors. For example, the service levels may vary significantly. Some organisations opt for non-stop operations, others seek basic service levels that allow up to one hour unscheduled downtime per month (or more). The key challenge facing IT organisations reviewing their infrastructure is to strike a balance between service level, cost, quality and risks. To address this requirement, IBRS has developed an Infrastructure Maturity Model1 to help organisations understand the service components dependencies before selecting an infrastructure alternative.

Conclusion: While release and change management processes have been contributing to good service availability during the last 20 years, the increased service architecture complexity caused by adopting multiple Cloud and digital services has demonstrated that release and change management methods used to date are inadequate for the new world. As a result, end users have been experiencing unscheduled downtime that has impacted their business operations and led to embarrassment in the media. This research publication provides guidance on how to raise the maturity of release and change management processes to address these critical issues.

Conclusion: Despite being first published over 10 years ago, ITIL service design remains a pain point for both project delivery and service operations teams respectively. The former claims the latter requires the creation of additional deliverables at the point of service transition, while the latter expresses frustration at the lack of attention paid to service design during early stages of project delivery.

The reality is responsibility for IT service design extends beyond both these teams with all functions across IT having a role to play, from strategy all the way through to operations. When all aspects of the IT organisation contribute to the design of new, and modification of existing, services the artificial hump of service design can be avoided. The key is identifying who should be capturing and sharing what information to support service design – an outcome that can be achieved by adopting an end-to-end process integration model for the business IT.

Conclusion: The aim of IBRS’s CRM modernisation series of advisory papers is to help organisations create a contemporary CRM strategy, not to advocate for specific solutions. Many organisations are considering two powerful players in the CRM space as part of their modernisation efforts: Salesforce and Microsoft. These two vendors are the most encountered local players when talking about CRM systems at the high end of the market.

We have selected these two vendors to illustrate the nuances in the pricing structure for licensing and total costs of services.

Comparing the two vendors’ solutions is complicated by the fact that each packages different aspects of the modern CRM in different modules, and prices them in different ways. This paper strives to provide clarity for organisations attempting to evaluate the two solutions. More importantly, it is an example of how the ‘devil is in the detail’ when it comes to total cost of service of SaaS-based solutions.

Conclusion: Agile approaches are being applied to a wide range of projects and activities within organisations including infrastructure upgrade projects of known tools and devices and across existing customer bases. Focusing on the technology elements and progressing quickly to build and test can uncover blind spots due to a high degree of familiarity and assumptions. Areas such as stakeholder engagement, vendor management, integration and the need for discovery and design can be glossed over as it is assumed that most of the details are known. The result is a discovery and gaps are discovered at the end of the test phase, just prior to release or even after release to production.

Conclusion: ERP SW licensing or Software-as-a-Service (SaaS) has many permutations and influences one of the largest IT investments for most organisations. Vendors aim to integrate, at a minimum, shared corporate data from financial data, HR, operations and sales. The benefits of aligned data, reporting and processes helps C-level decision makers track and improve organisation performance.

The most common arguments for implementing an ERP system are the cost savings and productivity improvements1. Effective SW governance is essential to avoid eroding expected cost savings or efficiencies.

Large government departments, local government authorities, public listed corporate entities or privately owned entities are all likely to have significant investment in an ERP and will need continued investment in the ERP if ongoing value is to be extracted. Small to medium organisations tend to be more agile and may be able to migrate to a SaaS solution to take advantage of lower migration costs and more cost-effective licensing arrangements.

Either way, modernisation or migration programs are opportunities to renegotiate SW licensing costs provided the pros and cons have been assessed.

Conclusion: The increased use of technical point-solutions has created the need for establishing an in-house core team of generalists capable of defining a coherent set of services that can improve the overall business performance. The key obstacle to building these strategic skills is the IT managers’ attitudes towards assigning work to existing staff. For example, IT managers tend to heavily exploit the existing skills of the technical staff to address specific requirements. Managers rarely give staff the chance to build new strategic skills that are beneficial to themselves and to their business.

Managers should strike a balance between strategic skill building and technical skill exploitation. This requires helping staff to acquire a deep understanding of the business operations, gain awareness of industry latest trends and offerings, and becoming capable of defining ICT solutions that can fix critical business problems.

Conclusion: Running IT-as-a-Service requires emulating vendors’ account management function by creating a business relationship manager (BRM) role. The role’s rationale is to provide strategic advice to business stakeholders and act as a single point of coordination between IT groups and business lines. BRM’s focus is to manage the relationship with business strategists and recommend IT solutions relevant to business performance improvement and cost reduction initiatives where applicable.

Conclusion: The three largest service providers in Australia for mobile phone services, Telstra, Optus and Vodafone, have all committed to providing 5G networks. 2019 has seen the introduction of 5G networks and devices; however, the coverage is still limited. Initial coverage by the service providers will focus on areas with the highest population density, providing coverage to a greater number of potential users. In 2019, it is estimated that coverage should be available to about 4 million potential subscribers.

The jump in speed and reduction in network latency will open up opportunities for new services and customer experiences that would not be practical using existing 3G or 4G networks. There is a large potential economic upside and organisations should be planning for future use cases.

This document provides a template of specifications and requirements for a modern CRM, categorised by several key areas

Conclusion: The success of digital transformation, hybrid Cloud deployment and multi-service providers’ governance largely depends on IT services being integrated and managed in a unified and standard way. Service integration and management (SIAM) is an approach to address this requirement. However, its full implementation is a massive undertaking covering delivery processes, organisational structure changes, service cost tracking, service skills and an effective deployment of end-to-end management tools. This note recommends a quick win approach that focuses on getting the service essentials fulfilled depending upon the status of external services used by an IT organisation.

Conclusion: Business executives in different business units are bypassing ICT with enterprise Software-as-a-Service. Two early leaders in this trend – marketing and human resources departments – are now rediscovering age-old challenges of uncoordinated software selection. CIOs must transform the ICT group to run IT-as-a-Service to help the organisation avoid information and process fragmentation, as well as reposition their teams as consultative partners. There is no time to wait.

Conclusion: External Cloud services can realise cost reduction up to 50 % p. a. and promise no set-up or exit fees. While the ongoing cost reduction is realistic, there are significant other costs related to third-party services that should be considered to calculate the overall cost saving of Cloud migration. They are:

  • Transition-in cost due to the use of external consulting services to set up the new environment (up to $2.5 million for 7,000 users), as well as procurement cost to prepare tenders, select vendors and negotiate contracts (up to $300,000)
  • Transition-out fees to migrate the current service to another service provider (similar to transition-in cost)
  • Hardware depreciation related to private Cloud exit
  • Governance fees to ensure Cloud consumption remains within budget and the desired service levels are tracked and met (up to 7 % of the annual cost)
  • Risk mitigation strategies to ensure the Cloud service remains secure.

The purpose of this research note is to provide a step-by-step approach to determine the ongoing cost-saving opportunities needed for Cloud migration business case1 preparation.

Conclusion: The ubiquitous availability of smartphone and wearable technology has opened up opportunities for a wide range of new applications that take advantage of knowing the location and proximity of these devices.

One of the newer underlying technologies that enable these new apps are low-cost small beacons that provide regular transmissions, usually to Bluetooth-enabled devices. When working on digital transformation projects or opportunities to innovate, these technologies should be included in the developer’s tool bag.

Conclusion: Globally, organisations are dealing with the challenges of “digital transformations” and the need to “innovate”. Chief information officers (CIOs) need to support their organisations in these initiatives, but the ownership in defining what is required rests with the business managers, and the key executives such as the chief marketing officers, chief supply chain officers, chief human resources officers and chief executive officers. If the organisation has one, chief technology officers would be a contributor in terms of how technology can be included in innovation initiatives.

CIOs need to be valued as trusted advisors to the business leaders in terms of what technology solutions will support their businesses’ initiatives.

Conclusion: Some ICT strategies are technology-centric while others are business-centric. The technology-centric strategies are usually developed without business stakeholders’ involvement resulting in limited business buy-in. Business-centric strategies are based on business strategies but have a short life-span. This is because market forces require business strategies to change frequently. IBRS recommends that ICT strategies be derived from business and IT guiding principles.
The rationale is that guiding principles have a longer life-span than business strategies and can deliver the desired outcome such as:

  • leveraging new technology
  • involving business stakeholders in the development process
  • realising business value in a timely and cost-effective manner.

Conclusion: Public Cloud is not the solution to all IT organisations’ technology and services problems. This is because most IT organisations use a portfolio of environments such as legacy systems, in-house and outsourced services, customised IT service management tools and standard applications (e. g. email) that cannot be all retrofitted in a public Cloud architecture without major rework. As a result, hybrid Cloud has become the preferred direction because it allows the multiple environments to co-exist in a cost-effective manner. However, a convincing business case is needed to gain business and IT senior executives’ sponsorship to adopt hybrid Cloud. While Cloud migration benefits and risk mitigation are critical success factors, the deployment-hidden cost is a major contributor to failure. The objectives of this research note are to provide a framework1 to develop the business case and to ensure its cost includes the following:

  • Hybrid Cloud strategy development,
  • Risks identification and mitigation,
  • Go-to-market strategy, providers’ selection and contract negotiation, and
  • Ongoing governance to realise the desired business benefits. This can reach up to 7 % of the yearly cost.

Conclusion: As self-service data analytics and visualisation becomes mainstream – due in no small part to Microsoft’s Power BI strategy – traditional data teams within IT groups need to reconsider traditional business intelligence architectures and plan a migration to a new environment. Underpinning the new architecture must be a sharper focus on tools and practices to support data governance, which is not a strength of Microsoft’s portfolio.

Related Articles:

"Can IBRS suggest or advise on any data warehouse products?" IBRS, 2017-07-14 10:20:21

"Can you escape the power of Power BI?" IBRS, 2018-11-02 11:32:21

"Reframing Business Intelligence as Critical Business Imperatives" IBRS, 2015-10-03 00:03:12

Conclusion: IT organisations wishing to create value should initiate selling processes to define business needs, establish SLAs for mission-critical systems and provide IT solutions to key business issues. This will result in boosting IT staff confidence and managing business lines’ expectations more effectively.

Related Articles:

"Importance of a balanced ICT investment portfolio" IBRS, 2018-09-04 13:42:25

"Running IT-as-a-Service Part 47: IT value creation accelerated approach – phase 1" IBRS, 2018-10-04 13:01:03

Conclusion: Microsoft’s portfolio of business intelligence (BI) products now places the vendor in a market-leading position. Over the next three to five years, IBRS expects Microsoft to continue to strengthen its market position in BI, largely through its ability to expose a large number of users to self-service data visualisation and storytelling via some of Power BI’s features being included in Office 365.

Exploring Microsoft’s strategy for Power BI provides several important issues for consideration.

Related Articles:

"Digital and AI-based transformation requires an evolution in business intelligence architectures" IBRS, 2018-05-04 19:06:41

"Return on Investment in Data and Analytics" IBRS, 2015-10-03 00:12:43

Conclusion: IT organisations wishing to create value are challenged by long implementation time-scales and inability to change the business perception of IT capability. To address these challenges, IT organisations should adopt an accelerated approach by deploying key processes within a six-month period, to demonstrate service quality and commitment to meet business needs in a rational fashion. Failure to do so will brand IT as a support function, and will make IT desire to earn strategic partner status virtually unachievable.

Related Articles:

"Benefits management: Keeping it real" IBRS, 2018-07-05 03:02:17

"Importance of a balanced ICT investment portfolio" IBRS, 2018-09-04 13:42:25

"SNAPSHOT: Agile services spectrum" IBRS, 2018-05-04 19:10:01

IBRS iQ is a database of Client inquiries and is designed to get you talking to our Advisors about these topics in the context of your organisation in order to provide tailored advice for your needs.
 

Conclusion: The availability of modern, Cloud-based, omnichannel-focused stakeholder and customer relationship management (CRM) solutions is disrupting expectations of how public sector organisations should interact with their stakeholders, be it citizens and constituents, the business community, research or other agencies.

It is not just that new CRM solutions have additional features and modules when compared to more traditional CRM solution with histories that predate social media. Rather, the emerging modern CRM paradigm is focused on automation and mass personalisation of stakeholder communication rather than sales management.

A public sector’s CRM modernisation effort must, therefore, be based upon a firm understanding of the organisation’s most valuable stakeholder experiences. One way to achieve this understanding is to develop a stakeholder experience strategy.

Note: A sister note on this topic for private sector organisations is available.

Related Articles:

"CRM modernisation Part 1: Strategy, planning & selection" IBRS, 2018-09-04 05:20:15

"CRM modernisation Part 2B: Creating a customer experience strategy" IBRS, 2018-09-04 06:47:58

"CRM modernisation Part 3: Roles & responsibilities" IBRS, 2018-10-04 13:09:21

"Design thinking – do not rush the empathy" IBRS, 2016-05-05 03:03:00

"User Centred Design or Design Thinking" IBRS, 2017-07-03 23:24:11

Conclusion: The availability of modern, Cloud-based, omnichannel-focused stakeholder and customer relationship management (CRM) solutions is disrupting customer expectations. It is not just that new CRM solutions have additional features and modules when compared to more traditional CRM solutions with a history predating social media. The modern CRM paradigm is focused on automation and mass personalisation of customer experiences rather than stakeholder and sales management.

A CRM modernisation effort must, therefore, be based upon a firm understanding of the organisation’s most valuable customer experiences. One way to achieve this understanding is to develop a customer experience strategy.

Note: sister note on this topic for public sector organisations is available.

Related Articles:

"CRM modernisation Part 1: Strategy, planning & selection" IBRS, 2018-09-04 05:20:15

"CRM modernisation Part 2A: Creating a public sector stakeholder experience strategy" IBRS, 2018-09-04 06:46:34

"CRM modernisation Part 3: Roles & responsibilities" IBRS, 2018-10-04 13:09:21

"Design thinking – do not rush the empathy" IBRS, 2016-05-05 03:03:00

"User Centred Design or Design Thinking" IBRS, 2017-07-03 23:24:11

Conclusion: IT organisations revisiting their service contracts as a result of mergers and acquisitions should establish a federated vendor management arrangement. The rationale is to ensure central consistency while retaining local autonomy to address tactical matters. For example, the central consistency demands leveraging the economy of scale to reduce cost, whilst the local autonomy allows the extension of services scope to cover local requirements without the need to change the local vendor management arrangements. However, the local autonomy should be governed by verifiable policies.

Related Articles:

"Delivering IT-as-a-Service requires an Enterprise Architecture for IT" IBRS, 2017-09-02 01:42:22

"Mergers, Acquisitions and Divestitures: What does it mean to your business?" IBRS, 2017-01-01 10:35:33

"Running IT as a Service Part 1: Prerequisite Building Blocks" IBRS, 2014-10-01 18:33:12

"What to do when your vendor gets acquired" IBRS, 2003-07-28 00:00:00

Conclusion: Given that multi-Cloud is a combination of public/private Cloud and customised systems governed by in-house and/or outsourced arrangements, end-to-end service level management becomes a critical success factor. IT organisations should implement a complete set of service level practices covering people, processes and systems that allow IT organisations to efficiently deliver services in accordance with service level agreements (SLAs).

The SLAs should span across the full service lifecycle. Service level foundation requires defining the:

  • services provided
  • metrics associated with these services
  • acceptable and unacceptable service levels
  • liabilities on the part of the service providers and the buyer, and
  • actions to be taken in specific circumstances.
Related Articles:

"Running IT-as-a-Service Part 38: Successful hybrid Cloud requires multi-provider governance framework" IBRS, 2018-02-01 10:08:33

"Running IT-as-a-Service Part 42: Incident and problem management integration is critical for hybrid Cloud" IBRS, 2018-06-01 04:14:55

Conclusion: During the last two decades, service desks delivery had the following shortcomings:

  • The service desk voice communication channel was characterised by a long waiting time to connect with service desk staff.
  • Service desk staff with limited skills minimised the number of issues resolved at the first point of contact.
  • There was a lack of online channels and limited self-service offerings, e.g. password reset.
  • The service charges were based on the number of incidents that discouraged providers to reduce the number of incidents.

To address these shortcomings, IT organisations should transform to Service Desk-as-a-Service. It should be powered by self-service virtual agents that can identify most of the solutions without the need to connect with service desk officers. The charges should be based on the number of users instead of outages to encourage providers to address outages’ root causes. Online services covering reporting on issues and following up progress should be favoured over voice communication.

Related Articles:

"Can IBRS identify what Service Desk software is most prevalent in Australia?" IBRS, 2017-04-30 11:16:50

"Running IT-as-a-Service Part 25: Understanding the cost drivers of Application-as-a-Service" IBRS, 2016-12-03 02:41:03

"Running IT-as-a-Service Part 43: Service level penalties and incentives for hybrid Cloud" IBRS, 2018-07-05 03:11:03

  • What is the future of work and how do we prepare our kids for it?
  • Are schools and universities setting kids up for future success?
  • Does technology in the classroom improve outcomes for kids?
  • Should every school student be learning to code?
  • And what are the skills that kids will need in tomorrow's world?

These are just some of the questions I ask Dr Joe Sweeney, technologist, researcher, writer and expert in workforce transformation in this episode of the Potential Psychology podcast.

Joe and I discuss schools, education, technology, tools, parenting and the future of work. We talk about why LEGO is important for the digital world, the role of books in future happiness and success and why the most important thing we can do for our kids is teaching them to think.

Join me as we explore the future - and the past - with Dr Joe Sweeney.

Full Story

Conclusion: Penalties and incentives are designed to ensure agreed critical service levels are achieved. Penalties are enforced whenever service levels are not met. Incentives are rewarded whenever agreed service levels are exceeded. However, there are cases whereby providers prefer to pay the penalty instead of improving the service level. For example, it is easier to pay a penalty of $10,000 instead of fixing a service issue that might cost $50,000. The purpose of this note is to prevent such situations from occurring and maintain the focus on meeting the service level in all circumstances.

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"Public Cloud Success requires Mature Governance" IBRS, 2014-01-30 00:00:00

"Running IT-as-a-Service Part 31: Maximising relationship management ROI" IBRS, 2017-06-04 03:41:00

"Running IT-as-a-Service Part 38: Successful hybrid Cloud requires multi-provider governance framework" IBRS, 2018-02-01 10:08:33

IBRS iQ is a database of Client inquiries and is designed to get you talking to our Advisors about these topics in the context of your organisation in order to provide tailored advice for your needs.

Conclusion: Traditional outsourcing and managed service contracts primarily focus on incident management service levels and give little attention to problem management. For example, incident management service level might be 95 per cent of Severity 2 outages resolved within four hours. In general, a temporary fix is sufficient to meet the incident management service levels. However, this might not prevent the outage from reoccurring because the outage root cause was not addressed. To address this issue, problem management root cause analysis must be used. This necessitates the integration of incident and problem management to govern multi-providers’ activities managing hybrid Cloud1.

IBRS iQ is a database of Client inquiries and is designed to get you talking to our Advisors about these topics in the context of your organisation in order to provide tailored advice for your needs.

Conclusion: Private Cloud1 managed by an as-a-Service contract has become the inevitable replacement of managed services arrangements. The main difference is that an as-a-Service contract is charged on consumption instead of on a fixed price basis and the service levels are tightly linked to end user experience and delivered at a lower price. However, unlike the common perception that Cloud migration is relatively easy, transitioning to private Cloud still requires thorough planning especially whenever the scope covers the full IT functions.

Conclusion: Business continuity and disaster recovery plans are largely developed in isolation. The result is ineffective recovery arrangements that do not meet the fundamental business needs. With the variety of Cloud service continuity solutions, IT organisations should initiate a unified business and IT continuity project to intimately involve business units in defining and deploying complete service recovery facilities, including mitigating the risks such as ransomware attacks and the lack of SaaS escrow1 services. This will tightly couple recovery services to business imperatives. The use of Cloud for service continuity (which was not available eight years ago) will reduce the overall cost of recovery.

IBRS iQ is a database of Client inquiries and is designed to get you talking to our Advisors about these topics in the context of your organisation in order to provide tailored advice for your needs.
 

Conclusion: While there was significant media attention on artificial intelligence and blockchain in 2017, the primary concerns of Australia’s CIOs remain focused on the more pressing issues of migration to the Cloud, and its impact on IT operations and staffing. Where discussions of artificial intelligence play a role is in automation processes and workforce transformation.

Conclusion: Many IT organisations have adopted business transformation1 strategies to help their businesses increase revenue. However, while digital transformation has succeeded in making the communication with the enterprise more convenient (e. g. mobile applications), it has been difficult to substantiate digital transformation contribution to the financial performance improvement. As a result, justifying new software projects has become more difficult. It is recommended to shift the digital transformation focus from technology point solutions to building quality products and services that increase profit and elevate customer satisfaction. The success should be measured by increased sales instead of only technology charms.

Conclusion: Many Cloud service providers manage their own systems but do not take any responsibility for working with other providers in a multi-sourced environment. As a result, IT organisations wishing to maximise the benefits of hybrid Cloud should develop a governance framework to address technology integration issues, optimise the interaction among service providers managing the multiple Clouds and define policies to operate in a multi-sourced environment. This will ensure business operations remain unaffected by service providers’ potential disputes.

Conclusion: Achieving the ability to comply with the new European General Data Protection Regulation is seen as a costly and burdensome overhead adding a new layer of complexity to how organisations will need to manage and secure Personally Identifiable Information (PII) records kept by them.

However, organisations should view the potential benefits of being able to use obtaining and maintaining the ability to comply with GDPR as an opportunity to justify investments in technologies, process improvements and people to deliver better overall outcomes for the organisation.

Rather than simply focusing on doing what is required to be able to comply, focus should be on using the opportunity to update tools and processes to improve organisational efficiencies, reduce costs, increase customer and employee loyalty, and improve productivity.

 
 IBRS iQ is a database of Client inquiries and is designed to get you talking to our Advisors about these topics in the context of your organisation in order to provide tailored advice for your needs.
 

Conclusion: One strategy to implement IT-as-a-Service models is to focus on business efficiency improvement. This requires shifting focus from addressing IT internal issues (e. g. operating system upgrade) to improving business operations. It requires building IT skills and capabilities to leverage the emerging IT trends, technologies and services in the areas of artificial intelligence, analytics, Internet of Things, cognitive learning and multi-Cloud management.

Conclusion: Managing large IT environments and provisioning IT services within an organisation is complex and complexity will always exist. However, not all complexity is “bad”. “Good” complexity is the complexity required to simplify, to reduce costs, create value, improve security and improve overall operations and results.

Focus needs to always be maintained on reducing “bad” complexity. “Bad” complexity is the complexity that makes it difficult to do things, difficult to secure, difficult to manage, difficult to innovate, or difficult to adapt to changes in the organisation. “Bad” complexity comes with high costs, including hidden costs in lost employee productivity and morale, potentially loss of new business opportunities, or higher staffing costs due to the limited availability of the skills needed.

Organisations need to maintain a mindset of constantly managing initiatives to drive towards simplification in their IT portfolio, understanding that achieving this will involve sophisticated and often complex planning and the successful execution of those plans.

Conclusion: One strategy to implement IT-as-a-Service models is to focus on efficiency improvement. This requires shifting focus from control to service improvement. The outcome will be end-user experience enrichment, cost reduction and business/IT operations synchronisation. Failure to do so will force IT to remain a utility provider offering insignificant innovation and playing a negligible role in business transformation.

Conclusion: One strategy to implement IT-as-a-Service models is to outsource the IT delivery capability to multiple service providers. However, the IT organisation remains accountable for the success of the outsourced arrangements. This requires the IT organisation to have a mature procurement and service provider governance function. The rationale is to acquire services and negotiate contracts that go beyond meeting the traditional IT needs to provide business innovation, performance improvement, cost reduction and risks mitigation covering IT and business vulnerabilities.

IT consists of information and communications technologies (ICT) typically used in business, corporate or enterprise management (e.g. computer processing, data management, business processes and applications, customer service, enterprise networking).

OT consists of specific operational technologies used to run a business operation (e.g. capital assets, manufacturing process control, machinery, vehicles, equipment, avionics, telemetry).

This MAP and its companion Compass research note provide guidance on evaluating the forms of organisation necessary to deliver reliable and effective interworking of IT and OT. The proximity of IT and OT varies substantially by industry.

Whatever the industry, organisations must seek out and evaluate existing and emerging opportunities in converging IT and OT. If these opportunities are missed, the business will lag in real-time management and suffer loss of their productivity and competitive edge.

 

 IBRS iQ is a database of Client inquiries and is designed to get you talking to our Advisors about these topics in the context of your organisation in order to provide tailored advice for your needs.

Collaboration services must align with business objctives to be effective but what does the buzzword "collaboration" really mean?

While the hype surrounding collaboration technologies and Web 2.0 services reaches fever pitch within the media, vendors and business managers alike, it will serve organisations well to stop and think carefully about what the buzzword collaboration really means for organisational processes, structures and efficiencies. When collaboration services are misaligned with business objectives, they will hinder, not aid, productivity. Having a model to categorise different forms – or modes – of collaboration is an important first-step in accurately matching technologies to different collaborative applications.

A decade ago, IBRS made the case that there were many different “modes” of collaboration and stressed the importance of choosing the appropriate mode for specific work activities. A framework provided clarity in matching the different collaborative modes to work. The framework included five aspects: power, process complexity, reach, community breadth and goals. While collaborative productivity tool suites have become the de facto working environment over the last decade, the uptake of deep collaborative work practices within and between organisations has been hindered by cultural resistance, as outlined in “Get Ready for Co-Authoring: Parts 1 & 2”. The shift to deep collaboration working practices will be resisted, but it is inevitable.

Conclusion: One strategy to implement IT-as-a-Service models is to build an in-house capability whereby the IT organisation is accountable for the full service delivery according to commercial practices. This requires the IT organisation to play the role of an internal service broker, expected to acquire external services and coordinate internal and external services delivery to meet the business needs. The service broker should at least be flexible, reliable and cost effective.

IBRS iQ is a database of Client inquiries and is designed to get you talking to our Advisors about these topics in the context of your organisation in order to provide tailored advice for your needs.

Conclusion: IBRS’ finding is that prominent Cloud marketplaces (CMPs) such as AWS Marketplace1, Microsoft Azure2, Google Cloud Platform3 and IBM Bluemix4 are gaining traction as alternatives to conventional enterprise ICT infrastructure and services sourcing.

Given the state of maturity of these marketplaces, they are currently only useful for quickly and conveniently locating and obtaining ICT infrastructure and microservices for use in low-risk small scale pilots or trials.

As wider take-up is underway with larger applications being adopted through AWS and Azure organisations should begin to prepare for a shift in the viability of enterprise-level solutions.

Our caution is that CMPs will not have profound impacts on enterprise ICT provision until both the IT and Procurement organisations within a business become satisfied that this approach has validity, value and is auditable5 and manageable.

Conclusion: Employ a bottom-up technology-based approach and a top-down business approach when developing the business and IT transformation program. Additionally, the program must take a pragmatic approach to reflect workplace changes that are feasible to meet the expectations of clients, staff, suppliers and the community.

Unless the program is continually revised to reflect the changing business and technology environment, it runs the risk of addressing yesterday’s problems. When benefits expected are not being realised, as indicated immediately below, it is important to implement turnaround strategies.

 IBRS iQ is a database of Client inquiries and is designed to get you talking to our Advisors about these topics in the context of your organisation in order to provide tailored advice for your needs.
 

Conclusion: Transitioning to hybrid Cloud might include migration from the current outsourcing contracts and some in-sourced activities to IT-as-a-Service models. The rationale is to accelerate efficiency gains realisation in a timely manner. One of the Procurement Manager’s options is to seek a service broker (e. g. prime contractor) to efficiently undertake the migration without disrupting the current business operations.

IT Procurement Managers should:

  • Establish governance arrangements underpinned by an effective organisational structure, tools and processes to select the service broker
  • Request the acceptance of the transition plan to become a prerequisite to contract signature
  • Manage the new contract until the business objectives are met

One of the migration critical success factors is a detailed transition plan covering the service provider selection and setting the foundation of a healthy relationship between both parties throughout the contract duration.

Conclusion: Executives trying to put ambitious and commendable goals in place may not appreciate the clarification that they may see as downgrading their original goal. When IT is asked to provide systems to support ambitious goals, the executive team needs to make sure the costs are understood and any ramifications that may result in significant changes or investment in IT solutions to support the goals are clearly identified and costed.

Having corporate goals or strategies as a focus to help employees know what is to be achieved is commendable and a proven approach to getting individuals and teams to focus on specific targets or outcomes. But setting the targets too high can come at a cost that is not justified or that may result in a continual investment in trying to achieve something that is beyond the organisation. It can also be unnecessary when the goal only requires the organisation to be delivering better than the nearest competitor, or be providing a unique offering or service that defines the organisation and sets it apart from others in the market.

Conclusion: Although automation is actively being introduced through digital transformation projects, it may still be a minor part of the technological mix for a few years. The main reason for the potentially slower progress with automation is the relatively mixed economic background. In some specific instances, it is an obvious option but otherwise its benefits will be ambiguous for some time.

In these foreseeable circumstances it may be that business as usual (BAU) is the overriding strategic principle.

Limited resources and a lack of skilled staff are holding back councils' IT plans. Australia's local councils are under increasing pressure to modernise their operations and improve on-line service delivery for residents, but many are starved of the funds and skills to achieve those goals. These are the key findings of a report from IBRS into local government IT management. The report - Winds of Change also Sweeping Local Government - found that local government IT leaders are grappling with demands to simultaneously improve online customer-centric service delivery while reducing operating expenses.

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Conclusion: IT organisations initiating efficiency improvement programs should automate inter-process interaction, focus on measurement and refine inter-group communication. This will enhance service availability, reduce delivery cost and enrich end user experience.

Conclusion: IT organisations wishing to maximise the ROI of as-a-Service contracts must transform the relationship management role from contract focus (i. e. whereby the mindset is to create a win/lose scenario) to a value focus whereby business benefits are realised. This demands building advanced skills in negotiation, communication and consulting. It is also necessary to extend the Relationship Manager’s role to one which ensures as-a-Service policies are developed, security policies are adhered to and external providers’ deliverables are synchronised with those of internal service providers.

Conclusion: With the migration to complex hybrid sourcing strategies, traditional IT organisations based on ‘plan/build/run’ models will not be suitable for acquiring Cloud services in an increasingly changing market. This is due to a vague understanding of service total cost of ownership and limited contract negotiation and management skills. IT organisations wishing to rely on external services must evolve to ‘plan/procure/govern’ structure to emphasise strategic service planning and hire specialised service providers’ governance skills. This shift should ensure mutual trust and respect between parties, well-defined service levels and clear roles and responsibilities. IBRS estimates the cost of the governance structure and services to be 3 %-7 % of the annual contract value. This must be considered during the business case preparation.

Conclusion: IT-as-a-Service is an initiative launched by IT organisations to fix an IT problem, whilst digital transformation is another initiative launched by business lines to fix a business problem. However, fixing both problems remains an enterprise’s critical issue. Hence, organisations wishing to remove the duplication between the two programs should unify both programs and ensure sufficient funds are available to implement the unified program in a timely and cost effective manner.

Conclusion: The enterprise architect (EA) role is one of the most intellectually challenging in an organisation. This is because it involves developing a systems roadmap to migrate from the current to a desired future state that is compatible with the business strategy.

Assign the wrong person to the EA role and the future systems will probably be unattainable and realising the business strategy problematic.

In this interview, Dr Wissam Raffoul outlines a practical and effective approach to migrating to an As-a-Service model. 

Sydney-based IT analysis firm IBRS has launched maturity assessment and methodology tools to assist organisations with the task of SaaS migration.

In order to improve business performance, or reduce the cost of doing business, forward-thinking IT organisations are trying to run IT as a service (ITaaS), said Dr Wissam Raffoul from IBRS.

“There are many challenges; for example, long software implementation time lines, fragmented delivery processes, as well as insufficient skilled resources to meet business demands,” said Dr Raffoul.

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Conclusion: While IaaS and PaaS adoption has been increasing, most IT organisations are hesitant to migrate their legacy systems to public SaaS. This is primarily due to the applications being highly customised resulting in a significant effort being required to retrofit existing systems to migrate them to public SaaS architecture in the Cloud.

Conclusion: Opposition to workplace change stemming from the organisation’s digital strategy agenda1 is inevitable. Astute IT managers expect it and identify initiatives to minimise opposition.

Digital strategy (or transformation) initiatives typically generate both overt and covert workplace resistance. Its sources may vary from situations such as:

  • Senior managers who fear that failure could adversely impact their career
  • Overworked middle managers claiming they cannot cope with more workplace change
  • IT professionals maintaining legacy systems not prepared to learn new skills.

Managers responsible for driving digital strategy agenda must identify where resistance is likely and determine how to minimise it. Assuming no resistance to it is unwise. Alternately, continually questioning the agenda may not reflect opposition but an indication staff are determining how to best implement it.

Conclusion: There are distinct differences between traditional outsourcing, managed services and as-a-service contracts. Traditional outsourcing and managed services are input-based contracts with a fixed price based on the number of the supplier team members delivering the service, service levels that do not reflect business operations and significant financial penalties when exiting for convenience.

As-a-service contracts are outcome-based contracts, priced on a consumption basis, measured by service levels that reflect end-user experience and no exit fees.

IT organisations should analyse the advantages and disadvantages of each alternative whilst formulating their sourcing and Cloud migration strategies.

Conclusion: Serverless programming is a new paradigm for developing and running Cloud-native solutions. It holds the promise of creating far more scalable solutions that ‘stitch together’ other Cloud services, making it the much-needed ‘programmatic underpinning’ for the Cloud. It is as significant a shift in software development as object orientation was from procedural programming in the 1980s.

However, serverless programming is immature, and its use cases not well understood. The timing for development teams to engage with serverless programming is largely dependent upon an organisation’s appetite for adopting bleeding-edge, Cloud-based services. The more services being adopted, the sooner the team should begin to learn this new programming paradigm. Even when used, care should be taken to limit the scope of deployment of serverless programs.

Conclusion: One of IT organisations’ objectives must be to reduce the total service cost of legacy applications by migrating them to a Cloud environment. However, achievement of the desired success largely lies in limiting the scope variations of Application-as-a-Service contracts and controlling the hidden cost drivers. This requires leveraging the lessons learnt in containing outsourcing cost and establishing flexible contracts in the legacy environment. Failure to do so may extend the legacy system lifetime and leave IT organisations with no alternative but to absorb the increased cost of application management on an ongoing basis.

Conclusion: The Total Cost of Ownership (TCO) was created two decades ago to provide visibility of the total cost of IT assets. It was targeted at IT organisations running an in-house mode of operations. While TCO can provide a good understanding of the internal IT asset cost, it could not estimate the cost per service because the IT budget was never based on service delivery. As a result, it was neither adequate to buy external services nor sufficient to assess the value that an IT organisation can bring to the business lines. IT organisations should adopt the Total Cost of Service (TCS) model to accurately estimate services’ internal costs, benchmark the external services cost and justify the services costs in terms of business imperatives.

Workforce transformation embraces far more than just mobility: it embraces not only where work gets done, but how, when and by whom. Much has been written about the fact that many jobs will cease to exist, while many others will transform beyond all recognition. And the impact these workforce changes will have on hiring practices and the structure of business is significant.

Conclusion: Business prefers certainty to doubt and some issues now appear to be clear:

  • Full deployment of Australia’s National Broadband Network now seems likely within about 5 years.
  • Its funding method and construction costs will create broadband access with higher prices than current ISP charges and those of Australia’s trading partners.
  • Enterprises now need to act in self-interest to review and plan their access networks for branch offices and customer service.

Conclusion: The drive for digital disruption has forced many organisations to implement contact centres’ online chat facilities (or equivalent). The rationale is to instantly connect customers with service experts and to resolve inquiries at the first contact whenever possible. While customers enjoy the ability to initiate a chat anytime and from any device, the ability of service providers to resolve inquiries to customers’ satisfaction remains unfulfilled in many cases, especially in the telecommunication carriers industry. Organisations should realise that a digital transformation is not only about implementing online facilities; it requires significant business process re-engineering to improve end-user experience across all types of inquiries.

Conclusion: Even though stakeholders may support ‘Digital’ initiatives – due in no small part to the all-encompassing nature of the term ‘Digital’ in today’s market – many of these initiatives will fail to deliver on the original intent. This is because the term ‘Digital’ enables stakeholders to reinterpret the intent of an initiative in a number of different ways. This can cause stakeholders – both within ICT groups and within the organisation more broadly – to take actions that deviate from the original intent, or that resist attempts to change. Even when organisations have put in place governance and processes to reconfirm stakeholders’ understanding of the initiative’s intentions, reinterpretations and misaligned actions can still occur.

By understanding the types of ‘mutation’ that stem from the use of ‘Digital’, and by appreciating the limitations of traditional methods of checking stakeholder alignment, policy and program leads can minimise the risk of projects being implemented in unexpected ways.

IBRS iQ is a database of Client inquiries and is designed to get you talking to our Advisors about these topics in the context of your organisation in order to provide tailored advice for your needs.

Conclusion: IT organisations driving their business transformation should mature their as-a-Service capability to deliver IT services at commercial standards in a timely and cost-effective manner. This should lead to effective delivery through the integration of business and IT processes.

Conclusion: The Australian Bureau of Statistics’ annual innovation survey quantifies the efforts of businesses in all industries. The status of innovation is quite mixed, between small businesses which tinker at the edges and larger enterprises which are more thorough.

Innovation is not one thing – it is a variety of actions which can be implemented. Improving technological capability is not a high priority and that could be a concern for CIOs, CTOs, CDOs and vendors because the purpose and value of technology, and related investments, appear less directly important to business.

IBRS iQ is a database of Client inquiries and is designed to get you talking to our Advisors about these topics in the context of your organisation in order to provide tailored advice for your needs.

Conclusion: Traditional disaster recovery plans do not mitigate risks against frequent software and hardware malfunction, nor do they integrate with business continuity plans. As a result, a production service may become unavailable for up to two days in certain cases (e. g. recovery from a database outage or data corruption). In the digital world, the business impact of such a failure will be significant as clients may place their orders with a competitor when they face an unavailable service for a prolonged period of time. IT organisations should deliver recovery-as-a-service that provides non-stop business operations.

Conclusion: Just as every marketable motor vehicle needs skilful designers and a proficient driver to reach its destination, an organisation needs visionary leaders and skilled staff to digitally transform its business model.

Technology, whilst important, represents just one wheel of the motor vehicle. Overstating technology’s value is simplistic. Vendors who promote technology, and their solution, as the cornerstone of the digital transformation strategy do themselves a disservice.

IBRS iQ is a database of Client inquiries and is designed to get you talking to our Advisors about these topics in the context of your organisation in order to provide tailored advice for your needs.

Conclusion: Organisations typically discuss the selection of enterprise mobility development in terms of web-based applications versus native applications, which quickly leads to debates regarding cross-platform tools versus standardising on one platform, such as iOS or Windows10. This is entirely the wrong way to think about enterprise mobile application development, resulting in unsustainable portfolios of fragmented and increasingly difficult to maintain applications. Instead, organisations should first identify the generalised use cases (i.e. common patterns of work) and seek to select mobile solution architectures (as opposed development tools) that meet each use case.

Conclusion: There is debate within the IT industry whether or not DevOps can replace ITIL1. From ITIL perspective, many IT organisations, especially in Australia, have been implementing ITIL processes since 1994 with significant investment in technology and professional services. Hence, it is impractical to just drop ITIL and adopt DevOps. This is because firstly, DevOps covers only Release Management which is only one process of the 26 processes of ITIL v3 and secondly, DevOps in not different from mature2 ITIL Release Management. In this light, existing ITIL organisations embarking on digital transformation should plan to mature Release Management to match DevOps principles. DevOps3 sites need to leverage the lessons learnt from ITIL implementation to enjoy a smooth business transformation as fixing only the software release process without integrating this with the remaining 25 ITIL processes is insufficient to raise the overall IT performance to the level needed by the digital world. This research outlines that ITIL and DevOps can co-exist in the same organisation once brought to the right maturity level.

This Compass is a companion document to IBRS’ Master Advisory Presentation (MAP) “Delivering Digital Business Transformation” which outlines business and management issues and provides guidance on delivering an effective digital business transformation.

Conclusion: IT organisations driving their business transformation should mature their internal consulting function to connect with business units’ service quality expectations. This should lead to consistent delivery, facilitate knowledge sharing and realise business benefits.

Conclusion: While the increased adoption of public IaaS1 can reduce cost and simplify technology procurement challenges, IaaS does not meet all IT organisations’ sourcing requirements such as legacy applications maintenance and IT service management. Hence, IT organisations are left with no alternative but to use multiple service providers to satisfy all their needs. This will increase clients’ governance cost of service providers and extend the duration of external services acquisition. As a result, a service broker model has emerged to provide one single point of accountability to all sourcing deliverables, simplify go-to-market strategies and fulfil the Cloud migration requirements in a cost-effective manner. IT organisations should assess the applicability of this model to their environment.

Conclusion: To facilitate business and IT transformation PMOs must be given a role that puts them at the forefront of advising management where best to invest scarce resources in business and IT-related projects whilst ensuring business systems are successfully implemented.

To be successful PMO staff need:

  • People management skills to help project managers reach their potential
  • Business acumen to assess competing claims for funds for business systems projects
  • To be able to shape management’s expectations of what IT can and cannot deliver.

Conclusion: Forward thinking IT organisations wishing to create a service differentiation should analyse their value activities to construct a “uniqueness capability”. The outcome should convince business lines that IT services can generate business value at a competitive price. The value chain firstly requires to address service delivery processes by constructing the IT value chain1 , secondly to realise cost advantage2 and thirdly to create service differentiation (this note).

Conclusion: IT organisations establishing business relationship management to excel at coordinating business and IT strategic matters should assess the current maturity of this role. The rationale is to allow IT to deliver solutions that improve business performance, reduce the cost of doing business and mitigate business risks.

Conclusion: IT organisations should not be treating software releases to support the digital transformation as “business as usual”, because they may overlook the demand for extra-company IT management process integration, rapid application deployment, and speedy problem resolution. IT organisations should recreate their “release to production” processes to address the new applications’ unique requirements for appropriate security, resilient architecture, and elevated service level standards.

Conclusion: Deployment of Office 365 as a pure Cloud solution has lagged the sales of Office 365 licences. This is partly due to lack of formal migration strategies, confusion over the licensing and user options1, although non-technical issues play a bigger role. To assist in the move to Office 365, IBRS has identified a framework that will assist organisations in their journey.

Related Articles:

"The journey of Office 365: A guiding framework Part 3: Post-implementation" IBRS, 2016-05-05 00:21:00

"The Journey to Office 365" IBRS, 2015-05-01 14:58:56

"The journey to Office 365: A guiding framework Part 1" IBRS, 2016-03-01 04:23:10

"The journey to Office 365: Part 4 – Skills" IBRS, 2016-06-02 00:26:00

Conclusion: Cost advantage can be achieved by firstly, estimating the existing services costs. Secondly, use cost effective external services. Thirdly, integrate services. Fourthly, retain cost advantage. This can be achieved by removing duplicated activities and influencing cost drivers.