The Next Big Thing

I was in a number of discussions this week with various organizations and one thing that I continued to emphasize were the new kinds of business value that can be generated when an organization thinks about computing (and cloud) as something other than a cost cutting strategy. A whole world of possibilities opens up if they view the computing technology as a business enabler allowing for greater depth of understanding and transparency through the use of the abundance of computing available. We seem to have forgotten that is why computers came into businesses in the first place (I know, I’ve stated this before).

I was talking with a client and they had a scenario for describing a new view for their enterprise going forward. They used the analogy that they had a business and they had a team providing a “time telling” function within the company. They started out with one clock but that was clearly insufficient, then they put clocks on everyone’s desk. Later they began to make custom clocks that were specific to individuals to the point where it became impossible to tell time, let alone support all the unique ways that time was being displayed. They then moved on to providing a common time service where individuals could make their own custom view if they wanted to, but there was only one system of record for time.

It was a pretty good analogy to IT and what has gone on in businesses with the proliferation of systems… But it did make me ask them “What is the purpose of time?”  for which I got an inquisitive look. Why have all these clocks in the first place – what is the expected outcome and how do we make money providing it?!?

We sometimes need to go back and ask some of these foundational questions. This requires a shift away from an IT centric view of optimization to “Why does the business need this function and what could we do to move the needle by looking at the problem in new ways?”

Even within the IT related efforts there are some foundational questions to be asked -- whether it is called shared services, utility computing, adaptive enterprise, real time enterprise or cloud computing, we should try to look at problems from at least three perspectives - People, Process and Technology. It’s like a three legged stool – forget one leg and the stool falls over.

As organizations start to look at issues like private and public cloud they need to define:

1. Who will benefit from the change, how will it be measured?
2. What new organization model is required?
3. What are roles and responsibilities for the new org model?
4. How will the help desk be integrated? Call escalation flows?
5. How will new demand requirements be managed?
6. How will communications across the business be handled?
7. How will SLA’s be measured? Who will receive them and why?
8. How will the company roll back a decision to move to a leveraged environment? Can we get our data back and how much will it cost to move it to a new service provider?
9. How will internal and external audit / legal / regulatory requirements be met?
10. What new training will be required to support the new model?
11. What is the financial model required to support the new model? (funding, charge-back etc.)

The technology components are the easiest to define. The above are issues should be top of mind for senior execs moving to leveraged services.

If you read Wikinomics a while back, you became familiar with the issue of crowdsourcing. It has been used to gather perspective on  problems large and small. The advances in its use continue -- an article titled: CrowdControl launches, brings AI to crowdsourcing discusses a particular companies approach to attempt to refine the quality of crowdsourcing answers.

Within HP we have numerous sentiment analysis and crowdsourcing research activities underway. The techniques for this kind of analysis have matured significantly over the past few years and they have started to be used in many industries and scenarios, including the stock market. The increased use is one of the side effects of having an abundance of computing and data collection capabilities.

It does make me wonder about where this will be head and how people will try to “game the system” once they know they opinions are being monitored.

McKinsey put out a post titled Social Innovation: A matter of scale that may shift some of your thinking about the social side of making change happen.

This fall in the US a new TV show premiered called Person of Interest. It is about an all seeing computer program used by the US government that has an imbedded “feature” to provide information to its creator about illegal activities.

In a recent Bloomberg Businessweek article, Palantir, the War on Terror's Secret Weapon, a real company that uses analytic techniques to look for patterns of behavior that may indicate illegal activities. There are some interesting parallels to the fictitious TV show.

I don’t want to focus on the crime busting capabilities, but rather the business opportunities. This is a great example of how the vast quantity of computing and data businesses have today can be used in new ways that were difficult to imaging a few years ago – back when this economic downturn started. The implementation of this idea a signpost of the vast opportunities business can embrace going forward, to capture market share or improve customer satisfaction.

According to a recent Dun & Bradstreet study, 20% of all business process outsourcing (BPO) deals fail within the first two years. Per the article, a major reason for the failure can be attributed to the “nail it down” approach which focuses on a tight and detailed pre-designed specification of requirements without regard to the BPO suppliers expertise and experience, arms-length dealings with multiple potential providers and old-fashioned adversarial contract negotiations with a focus on squeezing out the lowest price for the services (without regard for the effect on the business and end consumer).

Nail-it-down deals tend not to work for the following reasons:

1. Suppliers Are Not Asked To Design The Solution – this is a really strange behavior, since the reason the business is contracting with the supplier is because they are experts in the field.
2. Deals Are Based On False Economics – it should always have a strategic business focus – how does this relationship move the business forward. Instead the focus can be on the easily measured metrics defined by the people creating the contract. Yes, metrics need to be defined, but it’s the businesses goals that override any tactical metric. One good thing to ask is if the metric is being measured today and who is actually doing something based on that metric today. If it is the revenue generating side of the business that’s great. If it is an administrative convenience, probably not so good.
3. Adversarial Negotiations – Anything that can be done to define a win-win situation is well worth the effort. No one wants their supplier to go bankrupt supporting a deal that just puts everyone at risk. Yet, that is exactly the behavior seen by many tough negotiators. Ask the supplier if the deal structure will allow them to innovate during the life of the deal as well as how and why? Frankly, if the company was doing so well at the process that is being outsourced, they probably wouldn’t be outsourcing it. Give the supplier the ability to make the operations better, not just “turn the crank”.

What experiences have you had with BPO deals? Do you have a success or failure story you want to share? Or some tips and tricks?

You can also learn more about how HP is helping clients with BPO via the following customer case studies:

• Arkansas BreastCare
• Arkansas BreastCare (Video)
• laCaixa
• Bank of Canada

The latest Mars Rover, Curiosity, was launched yesterday at 10:02AM EST. It will begin its eight month journey to Mars to spend another two years researching whether or not Mars was ever suitable for life. The Curiosity rover is expected to land on the planet on Aug. 6, 2012, following a parachute- and retrorocket-assisted descent.

The rover is headed to Gale crater. Curiosity is much larger than any previous Mars Rover and is five times heavier. It's packed with an extensive equipment payload, including a drill on a 2.1-meter arm and a laser to vaporize rocks for easier onboard analysis. It is also carrying an autographed plaque, I’m not sure who they expect to read it but… it’s an interesting gesture.

I had to fly cross-country this weekend and being able to research and write a blog post while in the air is definitely an advantage over how I used to spend my time when flying. I would probably have never had the time to read about this rover and its flight without the gogo inflight WiFi capability. I don't always use it, but I find myself using it more.