Three months ago two Google researchers unveiled a project which has wide implications but attracted little attention. They proposed using ambient-audio identification technology to capture TV sound with a laptop PC to identify the TV programme that is the source of the sound and to use that information to produce personalised Internet content to the PC. This technological turnkey is called Mass Personalisation by the researchers because it brings TV and the Web together, harnessing large audiences but which are informed over the Web as individuals.

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Conclusion: Successful outsourcing initiatives usually have a number of common characteristics. Using these as a check list in new, or even existing, outsourcing deals can have a positive impact on the success of your outsourcing initiative.

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Conclusion: Watching and interpreting Google has become a strategic game; and whether its various plays may lead to gladiatorial combat with another or several large corporations. For most users of IT products and services, consumers and organisations, the alliances and struggles between Google and its competitors are either mysterious or irrelevant. Yet, the rise and rise of Google in so many sectors of the IT industry will present both users and vendors with challenges that are only just emerging.

Much as most consumers enjoy using a dominant search engine, few people would like to be restricted to just one service in other areas of work. The probability of Google dominating all the other information service delivery sectors such as news or TV media is remote. But it is conceivable that it may invade sectors in which it is not present today. Rather than attempt to understand what Google is doing it is timely for organisations to assess how they might deal with that situation.

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Conclusion: Often one of the unsung heroes in a successful IT management team is the Business Support manager, whose job it is to manage the organisations business management relationship with diverse stakeholders such as suppliers, clients, project teams and finance.

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A monthly review of all of the sourcing activity, upcoming tenders and news items

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Conclusion: Irrespective of organisational size or business sector there is an extraordinary sameness to many of the activities carried out by IT Departments. Interviewing CIOs in a variety of organisations bears this out. In 2006, some of the common threads of activity include:

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Conclusions: As virtualisation of distributed systems rapidly matures, IT organisations should evaluate their current virtualisation capability level and determine which level best supports the business’s needs. The right level of virtualisation capability will reduce complexity and increase infrastructure agility; enabling better alignment of IT infrastructure to applications requirements and hence alignment of IT infrastructure to business strategy.

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A monthly review of all of the sourcing activity, upcoming tenders and news items.

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Conclusion: Business Process Re-engineering (BPR) has been reborn, albeit in a new form. After achieving cult-like status for a number of years in the 1990s following publication of the book “Reengineering the Corporation”, authored by Michael Hammer and James Champy, BPR seemed to disappear from the corporate radar.

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Conclusion: A recent survey by Ideas International showed that 2/3rds of IT organisations use virtual servers, at least occasionally in their data centres, with 1/3rd using them at least frequently. While server virtualisation is commonly associated with server consolidation, and as a method of lowering hardware costs; early adaptors are using virtual servers to create an agile, utility-like infrastructure that is better aligned to the business’s needs.

Leading IT organisations use virtualised infrastructure, based on virtual x86 servers (generally VMware) and networked storage, to decouple workloads and data from the underlying hardware. This enables new infrastructure capabilities that better support the business’s availability and capacity requirements. Unlike the earlier, over-hyped promises of utility infrastructure, infrastructure virtualisation is a simple, practical technique that is delivering measurable business and IT benefits now.

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Conclusion: Determining how to exploit emerging technology, while managing technology for legacy systems, is increasing the span of control of the IT Infrastructure manager. Because the application systems often cross technology eras, as set out in the diagram below, the role of IT Infrastructure has become more complex, intellectually challenging and successful performance business critical. One of the down sides is managers typically have little time to participate in strategic conversations, limiting their career development opportunities.

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Conclusion: Discussions with IBRS clients have found that a large proportion of outsourcing contracts are re-negotiated or terminated early. The circumstances in which the exit occurs can affect the willingness of both parties to co-operate and for them to agree on the timing and cost to exit. If termination issues have not been negotiated as part of the original contract, then they will need to be finalised prior to the exit. In this situation an organisation is placed at a significant disadvantage, and there is a risk that lawyers will need to be called in. This is unlikely to lead to a smooth and non-disruptive exit.

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Since IT began as a profession, within many organisations there seems to have been some degree of tension between IT and Finance.

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Conclusion: Good enough, like the expression ‘common sense’, is tacitly understood but lacks precision, so it is relatively facile to criticise products and organisations for failing to deliver a gold standard. But it may be mistaken. The perception, or attitude, about a perfect product is simplistic. Price and value are important factors in how products and services are created and delivered, not an idealised ambition.

Rather than pursue an ideal, managers should make efficient and effective use of the real skills, resources, investments, available to them to provide competitive services in the marketplace. To do so requires good understanding of one’s own organisation and the market in which it operates.

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Conclusion: The quality of software architecture in a system is not something that is easily measurable; without the help of specialised tools and without the existence of a meaningful baseline or benchmark. The short life expectancy of most software systems is often explained as being due to rapid technological change. For the most part this explanation is simply a convenient excuse for tagging existing systems as “legacy” and for obtaining permission to build new systems without having to understand the fundamental forces that lead to legacy software.

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For some time now we have been, with varying degrees of success, implementing systems providing electronic document and records management capability; to address the large volumes of paper on construction projects and to better manage the complexities of engineering drawings. Due to the distributed project nature of our business and the power invested in project managers to make their own decisions, we have never managed to implement a single company wide solution, and by doing so have not realised the benefits that this standardisation provides. We find ourselves in the position where we are using several different ASP model solutions, one of which is of course inCite, and a number of proprietry third party products. This makes it considerably more difficult to introduce one standard system for managing project documentation across the business, while still taking into account the different requirements of the various delivery models i.e. straight design and construct, joint venture, alliance, PPP etc.

To satisfy an important part of the company’s strategic direction, we have been undertaking a review and formalisation of the organisation’s Management Systems. In this case Management Systems are defined as those processes which are integral to the way that the company does business. In the past these have been applicable to construction projects only, but the decision has now been taken to define, implement and maintain formalised business processes for all parts of the organisation. A large part of this review involves the selection of the optimum way of storing these processes and their associated business procedures, and publishing them. While these processes may or may not be enabled through an IT application, they will be maintained and accessed through an electronic repository. The million dollar question is which electronic repository.

Through this project the business has invested a significant effort in designing a revised format for these processes, and most of the content for construction projects has been put together in the new format. The business has now engaged, with IT, to go to the market to select a product to deliver the new Management System. Following a robust and detailed evaluation procedure involving a project team, including the major business stake holders, a decision was taken on the most appropriate product. A pilot is currently being undertaken to prove the suitability of this product with an initial implementation of the Management Systems planned for December 2006.

At this late stage of the project some doubt has been expressed about the value of the solution that has been chosen. While there is little doubt about the capability of the product to deliver the required solution, concern has been expressed in some quarters about the total cost of ownership for what is considered to be a point solution only. The chosen solution is a vendor driven product, with a significant cost for licences and on-going support. There is a feeling that a satisfactory solution could be provided through a commercial open source product, or through products for which we are already licenced because of other contracts with specific suppliers.

Supporters of the product claim, with some justification, that it has the capability of providing total enterprise content management to the business and can therefore deliver the value that is being questioned. Additionally, it can go a long way to satisfying the perceived need to have only one system in the business to manage all processes and associated documentation. The scope of this project however did not include other business requirements outside the Management Systems.

We have received well intentioned advice on this matter, both solicited and unsolicited, from a number of third parties. It has become apparent that there is a diversity of views on this subject which is of no use to us at all. The main issues seem to be:

  • what actually is an enterprise content management system?

  • having established what it is, do we need one?

  • having established that, do need one over arching enterprise content management system, or do we need a number of point solutions addressing business requirements as they arise?

  • if we do need one overarching enterprise content management system, what is the total cost of ownership – do we go for a vendor driven solution, open source solution or utilise one of the “freebies” that we are entitled to (assuming their suitability)?

  • where does an enterprise content management system sit in our IT architecture? Is it an infrastructure application, a platform, a business application, or a bit of all three?

There are some interesting schools of thought out there ranging through:

  • Enterprise Content Management addresses document management, records management, web content including intranet, extranet and internet and is underpinned by a work flow engine.

  • There is a significant immaturity in this market with little immediate sign of this improving. We should not be making a decision on one over arching solution until the market is more mature and there are indications that the major players are here to stay. We should be leveraging off our existing products in the meantime.

  • We should be considering commercial open source to reduce total cost of ownership. Is commercial open source really cheaper or is it just another model with much the same cost?

  • Enterprise Content Management is an infrastructure application to be built upon much like a relational data base.

  • Enterprise Content Management systems should be selected to suit the particular business need that is being addressed and is not necessarily one over arching system for the business.

  • Enterprise Content Management is a misleading name for managing unstructured information electronically.

  • Given our commitment to inCite and its current inability to deliver all of our requirements our chosen solution will always be a hybrid of point solutions

To help resolve these issues we have hurriedly put in place another project, running in parallel to the pilot; to which I referred above, to further analyse commercial open source offerings and selected other vendor supplied systems that could be considered to offer savings in total cost of ownership. We have a commitment to deliver the Management Systems within a certain time frame and we will honour that commitment. It may be, however, that we deliver them through a different product than that which is being piloted. The time frame for this decision is very tight.

Conclusion: Due to their scale of operation and the massive databases they need to manage, Australia’s major banks often act as a bellwether for other IT users. This is certainly the case at present as a number of banks commit to Master Data Management (MDM) in an effort to bring their management reporting into order.

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A monthly review of all of the sourcing activity, upcoming tenders and news items.

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Conclusion: For a project to be judged a success it must not only provide its deliverables on-time and within budget, it must also deliver the benefits that were outlined in its Business Case. These benefits will normally not be achieved unless there is a successful outcome to the process of change. The change may impact the organisation in a variety of ways, for example through changes to business processes, procedures, products or technology.

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Most of the advice offered in research on the IT aspects of mergers and acquisitions has focused on the acquiring organisation. Last month I wrote about the actions required in divesting part of your organisation; this month we have a review of what to do when you are subject to a takeover. IT organisations in a company being acquired have considerations and responsibilities of their own to address, and they are quite different to those of the acquiring company.

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Why do many IT projects that are obviously in serious trouble go well past the point where they should have been shutdown? We can all give examples of where money and resources have continued to be invested in such projects, but do we understand the factors that can impact on decision makers and unduly influence what would appear to be the rational decision to close down a troubled project?

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Conclusion: IT organisations are aware of the impending release of Windows Vista; however in a recent surveyi less than 20% of those with more than 100 desktops have a formal strategy for dealing with it. The most common driver for using Vista on the desktop is the need to keep current, so as to ensure long term support from both Microsoft and ISVs. None of the people interviewed anticipated any business benefit from upgrading and did not consider it an important or urgent project; instead they saw it as a necessary evil that must be dealt with.

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Conclusion: In the mid-nineties online marketing and e-commerce pioneer, Dave Carlick would often say that the Internet offered “a new bargain between consumers and marketers”. He meant that information was more readily accessible and that made prices easier to compare. Being able to obtain more information about goods and prices is one of the benefits of the Web to consumers.

In a channel environment where mainstream media is strong in securing audience reach, the Web seems to offer no additional advantages. Yet, coverage of an audience market is one part of the communications effort; something a stalwart of mass media, the chairman of Australia’s second largest media-buying company, affirmed recently.1

Whether used commercially, or in transacting ideas, the art of persuasion is critical for success. But it’s here that Dave Carlick’s observation is acute because, in part, information can be compared easily. The editorial control is solely with the publisher; the cost of distributing the message is miniscule; and further contact and action may be initiated.

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Conclusion: Compared to the consumer market, the enterprise market is more conservative when letting an external service provider store and manage its critical business information remotely, via the web. But in the face of spiralling internal IT operational costs, many companies are likely to significantly expand their use of Software as a Service (SaaS), previously known as Application Service Providers (ASPs) over the next five years.

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Conclusion: The continuing widening of the span of control of application systems managers is a major management concern. Unless the span is reduced by initiatives such as replacing systems with marginal value and rationalising the number of application software vendors, organisations will see their systems maintenance costs rising higher than other support costs and the time from program fault to fix blowing out.

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A monthly review of all of the sourcing activity, upcoming tenders and news items.

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Conclusion: The technology adoption cycle and its cousin, the hype cycle, are familiar concepts. While the theory is instructive, there are acknowledged gaps in its explanatory power, and consequently in practical application, although many organisations and vendors implicitly subscribe to the general thrust of the concept.

The steady stream of new technology – including innovations and upgrades - means potential buyers are evaluating products almost continuously; whether as consumers or for businesses. From both sides of the equation, can buyers and sellers make a better bargain with the idea of the adoption cycle? Could buyers be better informed and rational or is there a portion of emotion involved in buying technology? And how does a business adapt the technology adoption cycle to be successful?

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Conclusion: Industry and research publications have cogitated for many years on the CIO’s role and responsibilities. Some recent articles in journals have speculated the role will become redundant due to emergence of information systems or point solutions owned and operated by business units.

Whilst some organisations operate point solutions from within business units, e.g. equities trading desks in wholesale banks and exploration systems in oil and gas companies, the reality is that these organisations also have statutory reporting and corporate compliance requirements. These requirements force them to consolidate financial and other data typically under the remit of the CIO or equivalent.

Other commentators emphasise the supply side of the CIO role and assume IT literate business managers will occupy the demand side an act as informed buyers. In my observation this is less than ideal as the buyers typically have stretched performance objectives leaving them little time for involvement in IT related matters.

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Conclusion: Knowledge Management (KM) is often thought of as a dark art. It’s not. Many organisations can benefit in tangible ways (e.g. quick access to a problem database in a Help Desk context) by harvesting the knowledge that already exists within them.

The last article on KM concerned explicit knowledge management, being knowledge that has already been articulated in some form within an organisation. This article is focused on tacit or implicit knowledge which is concerned with the experiences of individuals.

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I recently had the opportunity to participate in a workspace design project for knowledge workers. The organisation was keen to provide the right physical environment and tools to help retain them and maximise their contribution to the success of the enterprise.

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Conclusion: The last 3 months have seen two significant announcements from Sun. Firstly the resignation of iconic CEO Scott McNealy in favour of Jonathan Schwartz, followed by an announcement of a planned 10%-13% reduction in workforce. Unfortunately Sun’s malaise has no quick fix and like notable IT giants before it (e.g., Digital Equipment, IBM) its problems are due to the commoditisation of its core value propositions, SPARC and Solaris.

As customers have increasingly adopted “good enough” Wintel/Lintel systems, Sun’s revenues have remained flat for the last 3 years and Sun has consistently posted losses since 2002. Sun has not yet established new value propositions that will return it to its former glory and the most likely outcome is a continued slide into irrelevance.

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Conclusion: The potentially negative impact of vendor lock-in is unavoidable, but it can be minimised by making intelligent choices with respect to the use of technology products when building application software. In the interest of keeping the cost of lock-in at bay, IT organisations should rate the maturity of the various technologies that are being employed, consider the results in the design of their enterprise architecture, and pay appropriate attention to the degree of modularisation within the architecture.

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Conclusion: An often reported reason behind failures in complex IT projects has been poor communications between the project team, the decision makers and other parties who were impacted by the project.

To address this project sponsors and project managers should ensure that communication strategies and associated communications plans are developed for all projects that are seen to be complex or have long lifecycles.

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In a 2003 Accenture study, 73 percent of the Fortune 1000 executives surveyed found company acquisitions easier than divesting part of their company, while 11 percent thought the opposite. This statistic is important, as many acquisitions involve divesting some part of a business entity prior to the M&A event by the seller, or afterward by the seller or buyer, depending on how the deal is structured. Divestiture brings a range of issues for the CIO to address, and the divestiture process can be quiet different to the acquisition process.

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A monthly review of all of the sourcing activity, upcoming tenders and news items.

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Conclusion: Networking has been a vital element of the Internet, and in organisations it has been formalised on the Web through sites such as Ryze or MySpace. Much of it involves business and technology professionals, and even people with specific political interests. Networks support and stimulate each member, and if harnessed with an agenda, even one as normal as bulk-buying discounts, they can exercise considerable influence.

Networking cannot fulfil all the communications and commercial demands of an organisation; however organisations could be using online networking to their advantage if it fits in with their communication aims.

Networking can be utilised by organisations in two ways:

  1. To generate new contacts or leads

  2. To gain a better understanding of a group or target market.

Initiatives in this area should be tested where possible on sites and through online networks. Adding networking as part of their Web communications can offer organisations a valuable means of working with customers and users and is a means of learning what users and consumers think.

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Conclusion: Inexperienced organisations often see benchmarking as the process of measuring best performance and fail to achieve the real value of benchmarking which is the discovery and adoption of best practices that drive best performance. Done appropriately benchmarking can yield unexpected and significant benefits, but done inappropriately it wastes considerable time and money1.

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Utility Computing is gaining higher levels of customer interest and acceptance, amid significant investments by systems vendors to build on their individual "brand" (e.g., Adaptive Enterprise, On Demand, Real Time Infrastructure) and the resulting cacophony of terms, definitions, and strategic directions. However, there still remain several crucial "missing-technology-links" in the evolutionary chain -- these will be addressed by both traditional software and systems vendors, as well as Open Source providers.

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Conclusion: The increase in IT related standards since the invention of the Web in 1989 can be seen as an indication of maturity of the IT industry. Today, all kinds of devices that contain software provide interfaces that allow them to communicate with other devices. Similarly, in the realm of enterprise software, today’s applications are typically interconnected across organisational boundaries and across a range of implementation technologies. But adoption and implementation of standards comes at a price. Which standards an organisation should embrace depends heavily on the nature of the business.

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Conclusion: A number of recent high profile IT project failures have involved issues with external suppliers of services. Despite this, the increasing complexity of IT projects and the need to minimise on-going costs of in-house IT resources will necessitate the continued use of external suppliers. The effective management of such suppliers requires project management staff with skills that cover not just project management but also a high level of commercial, contractual, leadership and interpersonal skills.

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