My mother is not an IT professional but she is a huge consumer of information and understands its importance to organizations. She was probably the first person in my life that forced me to understand the difference between data and information and we continue to engage in long and sophisticated discussions about information management and the latest trends. So I wasn't surprised when, about 6 months ago, she asked me to address some of her organization's key executives regarding "This thing called the Cloud." What did surprise me, however, was the other day when she wanted to know why Larry Ellison hates Cloud Computing so much...
I think my perspective on this question is very telling about a generation gap, the current state of IT and the cogs of the capitalist machine with its unruly PR devices. To understand why I was so shocked but amused by the question, let give you some background. First, my mom has worked in the health care industry since the mid 60's and has held a management role at one of the largest health care organizations in Southern California since 1974. That is 35 years in an industry not known to be at the cutting edge of IT. During that same time, I went from training wheels to an Apple IIe, to Oracle to IT consulting, to the Cloud. So when she asked me to come and speak to executives in the health care industry about Cloud Computing, I wasn't particularly excited. But they did entice me with a fantastic venue and great bottle of red, so I showed up. When I arrived and was greeted with enthusiasm and attentive faces, but I didn't exactly know how to answer their pressing question, "What is the Cloud and why is it such a big deal?" in their terms...
The second thing that one needs to understand is that Oracle, to this day, is the only global organization for which I have ever worked. Further, even while I was there, I only worked with mega enterprises; the telecommunications industry, the federal government, etc. As a result, I have always been largely disconnected from the trials and tribulations of the average IT department and have a hard time understanding their adherence to a policy of "server hugging." Moreover, I missed the days of main frame and client server computing, by the time I got to Oracle, Larry had ripped it all out and was in the midst of deploying ONE global, enterprise IT infrastructure with centralized data, tools and applications. Today, we would call such an architecture a "Private Cloud", but in those days it was just status-quo. Although our clients may have assumed that we did, in the sales organization, it was rare that we would provision a physical server for any reason, ever, and with very few exceptions, the only software on the desktop was MS Office and a browser. We had a Global IT organization somewhere, but no-one was really sure where...we occasionally saw guys from IT, but never saw a production server, a storage array, or anything but a network connection to provide the physical proof that a data center actually existed some place. To us, one could say, the whole thing was in the Cloud.
That is why when I left Oracle in 2002 to start consulting, it was only natural to use SFDC and other web based software services. I certainly wasn't going to invest in hardware and incur the associated expense. So when I started visiting customers to do installs, I was deplored to find that companies didn't have enterprise internet (not intrAnet) architectures. I couldn't believe that security was implemented at the network level and that most users had expensive desktop applications. More unbelievable was that company data could physically reside on an employee's laptop and walk out the door with them at the end of the day. For me, enterprise information management has ALWAYS been about the data...To me collecting, structuring, securing, leveraging and using the information to the advantage of the overall organization is what it's all about, not servers, operating systems, disc arrays or data centers.
Understanding this, I hope it is obvious why I find the whole situation around Cloud Computing so amusing. When I was asked by a group of really smart, non-IT, health care executives "What is the Cloud and why is it such a big deal?" I almost had to bite my tongue. Here was a group of people for whom IT had always been a little "cloudy", it was something that existed, somewhere, and you called them when you needed the newest version of Excel to do some analysis on your PC. Yes outside of the government, here was, to my view, the poster child industry for bureaucracy in IT, old world computing and the antithesis of innovation. Health care represented a generation gap that due to their lack of resources, extreme subservience to regulation and overall conservative culture regarding the flow of information had no place at the table discussing the latest trend in IT. But the wine was good...
I began my explanation of "the Cloud" without purposely being condescending with, "From your executive perspective, it's business as usual, the only difference is the burden of cost. Yes, there are data centers out there to manage physician, hospital and patient data. Yes, all of that cost money. The difference between Cloud and status-quo is just where that data resides, who owns it and who pays for it...why should your organization bare the entire cost?" Then I went in to my usual spiel about how much safer I feel regarding security and governance when data is at a neutral location and managed by an organization whose business it is to secure and provide authenticated and highly available access...I, for one, don't like knowing that my medical records are in paper files in a doctors office where the physician has almost instant access and I don't. A situation where I am forced to rely on a doctor's administrative staff, not a highly professional IT organization, to secure and insure the data. Not surprisingly, they all got it! The two big questions that spurred from the discussion were:
1. How much can we save moving to the Cloud?
2. How can we leverage the Cloud as a strategic advantage?
Seems that health care organizations, just like everyone else, are dealing the reality that the rising costs of running data centers will most certainly detract from their ability to deliver their core competency, in their case of making sick people better. It also seems that the industry is getting more competitive and may even start thinking outside the firewall. Certainly overseas competition, increased regulation and an aging population are spurring some new thinking. My compliments to the new innovators in health care...
Back to my response on why Larry Ellison hates the Cloud...I don't think he does; I think he just hates the word...after all he didn't coin it. That said, as a business strategy, he has been a true believer for over 10 years. Let's not forget, he implemented what to my view is certainly one of the earliest enterprise Cloud architectures, and by fear of the "ax" enforced its adoption and utilization (one could argue that it was Oracle's cloud, but there are plenty of idiots out there arguing for "private clouds" its just semantics). In the years immediately after Oracle saw a 33% increase in operating profit as a function of both top line growth and the incredible cost reductions associated with the elimination of IT infrastructure redundancy. By 1999, the Harvard Business School had concluded after its own independent audit, that Oracle had SAVED over $1Billion in operating expenses by adopting this strategy. This is probably the earliest endorsement for Cloud computing of which I am aware, and certainly it can provide valuable lessons for the average CEO to this day.
Finally, I think Larry may be upset that Oracle's achievements aren't the focus of all the PR and hype around Cloud Computing. More to the point, he think he's a bit displeased that, for the overall strategy to become mainstream, it took IBM endorsing and coining a new phrase describing it, just like they did for the PC...
Tuesday, September 29, 2009
Tuesday, September 22, 2009
IT Resources seaking shelter from the "Stormy" Cloud
In my last post I was captivated by my trip to the San Diego Cloud Conference and eluded to the fact that many of the IT professionals in attendance were very concerned about their perception of their own obsolescence in this era of the Cloud. In the past couple of weeks there were some major announcements including Apps.gov and I have had conversations with more and more technical folks who are voicing these concerns.
I would like to put this paranoia to rest, or at least start the process. From where I sit, the Cloud represents more opportunity for IT professionals than any computing advance in history and there are some fundamental reasons why:
1. Access to unprecedented amounts of data
2. Speed to market
3. The number of vendors playing in the Cloud space
First, lets address the major concern that IT folks have about their jobs. The concern goes like this, "My job is to maintain the servers and technical infrastructure of my company, if that is outsourced, I no longer have value..."
With that argument, I am in complete agreement. If, as an IT professional, you perceive your value as simply maintaining the place that data lives, then sign your severance papers right away and take up Bocci ball in the retirement home. But the last time I checked, IT wasn't about managing servers, it was about managing INFORMATION, thus the acronym. It's time that IT professionals rethought their roles. My friend Steve Gerken, former CIO at Chugai Pharma sees it this way, "Nobody in the company understands the importance of the information better than the IT folks, and of them, the DBA usually knows it best."
So assume the difference between successful and non-successful organizations is tied to the way that they manage their resources, than it stands to reason that those who do a better job managing their data (a very critical resource) would be more successful than those that don't. So take a look at the Cloud...
My friend Paul Laskin describes the end point of the Cloud as "One big data mash-up in which information sources will be ubiquitous." It is a great point, in fact we are seeing that illustrated very well in the consumer space right now. I think he is spot-on, and IT folks should embrace this idea. This leads to the first important concept, the amount of data to which we have access..
I look at non-Cloud IT shops similarly a small boat captain, out on the sea. Because he is resource constrained (being he a small boat) he does everything he can to insure that his boat floats. He secures it from leaks...he insures it is seaworthy, he makes certain that the infrastructure, the motor and transmission are well oiled and in proper working condition. When put to sea, he encounters storm clouds. He is overcome by huge waves and large amounts of rain, and his boat starts to flood and sink. Immediately he deploys all available resources to bail the water out and protect his boat. Eventually, he send and SOS to the business. He is overwhelmed by huge amounts of water (data) and can't cope. He sinks and curses the Cloud for his demise.
On the other hand, the Cloud savvy IT organization recognizes the oncoming downpour and invests in a water jet for their boat. Initially, it adds some overhead to their boat, but when the downpour comes, they blast the water aft and propel the boat forward. They have fine grained control over the direction of the blast and can throttle the flow. They have taken advantage of the situation and leapfrogged their competition.
We all agree that there will be a virtual onslaught of new data as a function of the Cloud. IT people are the best suited to transform it into a business benefit. But like the water jet, they need to invest in a proper Cloud foundation which will require extra effort initially. The second question will be how fast can they do it?
IT will certainly not be able to respond if they have to spool up new physical resources every time they get hit with new requests. They need to be positioned to take advantage of existing infrastructure available in the Cloud. I have spoken to many people who are using Amazon to prototype and even host production systems, not because its cheap, but because its THERE and minimizes the usual bureaucracy associated with resource allocation. It allows real time response.
Finally, the main reason that I believe IT professionals are more essential than ever in the Cloud era is their understanding of the actual work that will always be necessary to turn data into information. What I mean by this is that under all the new technologies, there is still work. The Cloud has reduced the barriers to entry for technology providers and opened the flood gates for vendors of all shapes and sizes with slick demos and compelling 'Try before you buy" offers. To the neophyte information managers of the business, all of this can be overwhelming. As a function of this, more than ever the business is going to need its trusted advisers in IT to sort through the glitter and get to what works.
Last week, at the end of his keynote Woody Pewitt from Microsoft predicted more need for IT professionals as a function of the Cloud. I agree, in an era in which technology is becoming more and more abundant, what becomes scarce (and therefore high value) is the expertise to apply it. I predict that expertise in good solid information management skills will command respect and attention from the business. I suggest a return to the MIS acronym which doesn't emphasize the "T" for technology that the IT acronym does. Indeed, Management Information Services sums it up pretty well I think...
I would like to put this paranoia to rest, or at least start the process. From where I sit, the Cloud represents more opportunity for IT professionals than any computing advance in history and there are some fundamental reasons why:
1. Access to unprecedented amounts of data
2. Speed to market
3. The number of vendors playing in the Cloud space
First, lets address the major concern that IT folks have about their jobs. The concern goes like this, "My job is to maintain the servers and technical infrastructure of my company, if that is outsourced, I no longer have value..."
With that argument, I am in complete agreement. If, as an IT professional, you perceive your value as simply maintaining the place that data lives, then sign your severance papers right away and take up Bocci ball in the retirement home. But the last time I checked, IT wasn't about managing servers, it was about managing INFORMATION, thus the acronym. It's time that IT professionals rethought their roles. My friend Steve Gerken, former CIO at Chugai Pharma sees it this way, "Nobody in the company understands the importance of the information better than the IT folks, and of them, the DBA usually knows it best."
So assume the difference between successful and non-successful organizations is tied to the way that they manage their resources, than it stands to reason that those who do a better job managing their data (a very critical resource) would be more successful than those that don't. So take a look at the Cloud...
My friend Paul Laskin describes the end point of the Cloud as "One big data mash-up in which information sources will be ubiquitous." It is a great point, in fact we are seeing that illustrated very well in the consumer space right now. I think he is spot-on, and IT folks should embrace this idea. This leads to the first important concept, the amount of data to which we have access..
I look at non-Cloud IT shops similarly a small boat captain, out on the sea. Because he is resource constrained (being he a small boat) he does everything he can to insure that his boat floats. He secures it from leaks...he insures it is seaworthy, he makes certain that the infrastructure, the motor and transmission are well oiled and in proper working condition. When put to sea, he encounters storm clouds. He is overcome by huge waves and large amounts of rain, and his boat starts to flood and sink. Immediately he deploys all available resources to bail the water out and protect his boat. Eventually, he send and SOS to the business. He is overwhelmed by huge amounts of water (data) and can't cope. He sinks and curses the Cloud for his demise.
On the other hand, the Cloud savvy IT organization recognizes the oncoming downpour and invests in a water jet for their boat. Initially, it adds some overhead to their boat, but when the downpour comes, they blast the water aft and propel the boat forward. They have fine grained control over the direction of the blast and can throttle the flow. They have taken advantage of the situation and leapfrogged their competition.
We all agree that there will be a virtual onslaught of new data as a function of the Cloud. IT people are the best suited to transform it into a business benefit. But like the water jet, they need to invest in a proper Cloud foundation which will require extra effort initially. The second question will be how fast can they do it?
IT will certainly not be able to respond if they have to spool up new physical resources every time they get hit with new requests. They need to be positioned to take advantage of existing infrastructure available in the Cloud. I have spoken to many people who are using Amazon to prototype and even host production systems, not because its cheap, but because its THERE and minimizes the usual bureaucracy associated with resource allocation. It allows real time response.
Finally, the main reason that I believe IT professionals are more essential than ever in the Cloud era is their understanding of the actual work that will always be necessary to turn data into information. What I mean by this is that under all the new technologies, there is still work. The Cloud has reduced the barriers to entry for technology providers and opened the flood gates for vendors of all shapes and sizes with slick demos and compelling 'Try before you buy" offers. To the neophyte information managers of the business, all of this can be overwhelming. As a function of this, more than ever the business is going to need its trusted advisers in IT to sort through the glitter and get to what works.
Last week, at the end of his keynote Woody Pewitt from Microsoft predicted more need for IT professionals as a function of the Cloud. I agree, in an era in which technology is becoming more and more abundant, what becomes scarce (and therefore high value) is the expertise to apply it. I predict that expertise in good solid information management skills will command respect and attention from the business. I suggest a return to the MIS acronym which doesn't emphasize the "T" for technology that the IT acronym does. Indeed, Management Information Services sums it up pretty well I think...
Thursday, September 10, 2009
There are 2 S's in SaaS
Yesterday I went to the San Diego Cloud Computing Conference and a couple of things really jumped out at me:
1. Outside of Silicon Valley, things aren't so "Cloudy"
2. There is a lot of money to be made in "as a Service" model so long as you are in the service business.
With regard to the first, having lived in Silicon Valley for years, it was always a wake up call when I would come home to Southern California. In the years since I moved back permanently, I appreciate my regular trips back to Northern California where they actually speak my language. The fact of the matter is that, outside of the Bay Area and a few forward thinking places on the East Coast, technology isn't the center of the universe, and by and large, people are nowhere near as tech savvy. Southern California definitely illustrates this fact. It was clear that, by the nature of the questions being asked by people in the IT community from the region, that there is not a clear and concise understanding of the Cloud let alone the different aspects of its adoption, in particular, the differences between IaaS, PaaS, and SaaS. There is still a lot of evangelism to be done.
In this fact lies the opportunity for those of us who provide solutions consulting. The messages that is clear to me is that the technology companies still don't do much to help the situation as demonstrated by the key notes; several of them were given at the conference and they were all essentially pitches for specific technology products. I have said for years that SFDC claims to be the "No Software" company, but they continue to conduct themselves just like the "Baby Oracle" that they are. The only difference between the SFDC and Oracle is their distribution platform, and maybe rightly so, as it seems to have worked.
But I think that this is changing. What is interesting to me at this juncture is the shift from technology being the high value piece of the equation. This is effecting the way the ultimate client views the Cloud vendors. In an age where all of the components of an enterprise class system can be either downloaded or accesses for free, technology is no longer scarce, and therefore, no longer commands high value. Interestingly, both the closing discussion of the SFDC and Microsoft keynotes eluded to this point. Peter Coffee from Salesforce was very specific when he said that the game is now going to be run by the trusted advisers, Accenture, Deloitte, etc. Woody Pewitt from Microsoft expounded on the idea when he addressed audience concerns that technical skill sets were becoming less prevalent, he said "$300/hr for a business analyst is a lot better than $90 for a cable-puller."
All of this leads up to the key point...it is the "S" that signifies service in the acronym that is the more important in the new age of the Cloud. As such, the technology vendors MUST rethink themselves in terms of Service Provider, and more importantly, the actual service providers, the systems integrators, VAR's and professional services firms need to rethink themselves as well. Technology in the age of the Cloud is quickly becoming a commodity, and the expertise to evangelize it, leverage it and gain from it is becoming the critical factor to success.
1. Outside of Silicon Valley, things aren't so "Cloudy"
2. There is a lot of money to be made in "as a Service" model so long as you are in the service business.
With regard to the first, having lived in Silicon Valley for years, it was always a wake up call when I would come home to Southern California. In the years since I moved back permanently, I appreciate my regular trips back to Northern California where they actually speak my language. The fact of the matter is that, outside of the Bay Area and a few forward thinking places on the East Coast, technology isn't the center of the universe, and by and large, people are nowhere near as tech savvy. Southern California definitely illustrates this fact. It was clear that, by the nature of the questions being asked by people in the IT community from the region, that there is not a clear and concise understanding of the Cloud let alone the different aspects of its adoption, in particular, the differences between IaaS, PaaS, and SaaS. There is still a lot of evangelism to be done.
In this fact lies the opportunity for those of us who provide solutions consulting. The messages that is clear to me is that the technology companies still don't do much to help the situation as demonstrated by the key notes; several of them were given at the conference and they were all essentially pitches for specific technology products. I have said for years that SFDC claims to be the "No Software" company, but they continue to conduct themselves just like the "Baby Oracle" that they are. The only difference between the SFDC and Oracle is their distribution platform, and maybe rightly so, as it seems to have worked.
But I think that this is changing. What is interesting to me at this juncture is the shift from technology being the high value piece of the equation. This is effecting the way the ultimate client views the Cloud vendors. In an age where all of the components of an enterprise class system can be either downloaded or accesses for free, technology is no longer scarce, and therefore, no longer commands high value. Interestingly, both the closing discussion of the SFDC and Microsoft keynotes eluded to this point. Peter Coffee from Salesforce was very specific when he said that the game is now going to be run by the trusted advisers, Accenture, Deloitte, etc. Woody Pewitt from Microsoft expounded on the idea when he addressed audience concerns that technical skill sets were becoming less prevalent, he said "$300/hr for a business analyst is a lot better than $90 for a cable-puller."
All of this leads up to the key point...it is the "S" that signifies service in the acronym that is the more important in the new age of the Cloud. As such, the technology vendors MUST rethink themselves in terms of Service Provider, and more importantly, the actual service providers, the systems integrators, VAR's and professional services firms need to rethink themselves as well. Technology in the age of the Cloud is quickly becoming a commodity, and the expertise to evangelize it, leverage it and gain from it is becoming the critical factor to success.
Friday, September 4, 2009
Storm in the Cloud
As Chris Anderson demonstrates in his book "The Long Tail" abundance is the hallmark of any
mature industry. When most of us were in high school, there were but a few choices for home
audio...now there is an entire industry that advises the consumer on the best among millions of
components for home audio and video. Yet, even though the number of vendors has exploded in
recent years, few have emerged to advise the new enterprise on its Information Technology dilemmas.
Once regarded and revered for its low barriers to utilization and its relative simplicity, Web 2.0, or
The Cloud, as it has come to be known, has promised to make information more accessible, increase
its value and theoretically offer more and better fine grained security and auditability. But the truth is that The Cloud is really a stormy place. Torrential rainfalls of useless data are the now the norm,
professional and personal lives are being flooded with countless products and applications that
distract our attention and more and more IT Professionals are Chasing Their Own "Long Tails"
attempting to control all the new complexity.
mature industry. When most of us were in high school, there were but a few choices for home
audio...now there is an entire industry that advises the consumer on the best among millions of
components for home audio and video. Yet, even though the number of vendors has exploded in
recent years, few have emerged to advise the new enterprise on its Information Technology dilemmas.
Once regarded and revered for its low barriers to utilization and its relative simplicity, Web 2.0, or
The Cloud, as it has come to be known, has promised to make information more accessible, increase
its value and theoretically offer more and better fine grained security and auditability. But the truth is that The Cloud is really a stormy place. Torrential rainfalls of useless data are the now the norm,
professional and personal lives are being flooded with countless products and applications that
distract our attention and more and more IT Professionals are Chasing Their Own "Long Tails"
attempting to control all the new complexity.
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