Nothing to Fear but Fear itself

On my way back from a Telecom conference – in Hawaii of all places! – I read an interesting article stating that CEO’s are nervous about how they will succeed in 2013. I hope they are not feeling inhibited by the technology that their businesses use, because if they are, then clearly I am not getting my blog out to enough people!
It was very interesting to read the concerns regarding “too many unknowns” that need to be managed during this year: market stability; changes in governments; regulatory changes; the risk of economies slowing down further; and managing supply chains. Now, I know I am often regarded as being “ultra positive” when looking at business challenges and I am probably too often looking for the silver lining in any challenge, but seriously…we have been managing thus far, are we really saying we haven’t yet learned to adapt?
Businesses now have access to the tools to help them adapt their businesses to the ongoing market dynamics, whether they are localized or global. Most successful companies have the necessary tools right at their finger tips. If you don’t, I am not suggesting a complete rip and replace of your existing systems and communications platforms … those assets, are, or are in the process of being depreciated. What I am suggesting is to look around and ask yourself this question – Can I make business decisions first and foremost knowing my IT & Comm’s will adapt to those needs? Will my infrastructure be able to adapt to necessary business changes and challenges? I am hopeful (yes I know Mister Positive) that there are a few of you out there who are thinking that yes, we have started to progress towards a business which can adapt to change.
This past year has been exciting! Business processes are being virtualized, meaning we only need to pay software providers, for the number of active sessions, which is ultimately dependent on the success and customer demand. Communications services are now accessible through a network, rather than taking up expensive office space and, security is increasingly being embedded in internet gateways, which has resulted in reducing the need for higher capex. All of these items are helping businesses to manage more effectively, its assets, which are directly impacting people, processes and place.
With all of that said above why then is there still this drive to spend capex? How can it be, that in a market where we are concerned about whether a business will survive, that people still want to buy assets that will sit on their books for the next 5-7 years. I understand the emotional aspect, this is what people have done for years and they are given a budget and hence think it is better to spend it upfront in case they don’t get another one. Think about it though, what if you could have a meeting between your CEO, CFO and CIO and define a new way of working, one in which the costs of IT & Comm’s would be directly associated to the growth or decline of a business?
Of course this is not just relevant to local market businesses but also international ones, in fact this approach is possibly even more important to international businesses that have to deal with both growth and decline, in parallel, yet coming from different markets. Well again, what if you were able to redeploy IT & Comm’s resources to countries where there is growth or increased demand and then shift those again if the wave of growth should start to decline? I have seen businesses do this with people, but then get caught up with increased cost as they seek to buy incremental equipment and services to temporarily support this staff. This can be expensive if after those temporary resources have gone and you haven’t reallocated them and they simply gather dust.
In Asia. we have become increasingly aware of the regulatory limitations in terms of security, voice and in some markets the quality of the internet access. These are increasingly manageable as vendors seek to create new offerings to be regulatory compliant whilst driving new service creation. Take the example of being able to redirect local calls in Indonesia, yes these calls do need to remain in-country and as such need to be connected to a local operator, but separate the regulatory needs vs. the driver for efficiency. The Actual telephony server for the Indonesia office doesn’t need to be IN Indonesia, it can easily be in Singapore, but a small device located in the Indonesia office simply helps to separate local from international and office to office calls. It is small examples like this that can rapidly help to empower a business to decide what they want to do, provide them the ability to effectively manage and/or adapt to changes around them, and then help to minimize the immediate concern of how much is it going to cost.
I challenge the CEO’s out there to pull together their leadership team and ask the question, how elastic is your IT & Comm’s environment? Can IT & Comm’s be an enabler for business change or will it be an inhibitor? If the latter, then you have some work to do, as businesses who are already on this journey will start to move past you in their goals to maximize growth, mitigate risk and manage change, without the concern of significant ICT change management overheads.
Hence don’t fear change, embrace it, and use it to enable your business to become more robust, in a market which currently requires you to adapt, in order to remain relevant, and create the opportunity to drive sustainable growth.

Are We Ready for Cloud?

I can appreciate that anyone reading this title will ask – what do you mean are we ready for Cloud, it’s in the market already, the market has been speaking about it for years, even in your own blog Nathan you have been talking about this? No I haven’t had memory loss – yet -  but this blog will look at a broader context of Cloud Computing.

Many businesses are already experimenting with Cloud solutions either for testing, extending data storage or generally preparing for cloud migration. However are we really ready for this change and what are the impacts it will have on our way of working? I hear many businesses talking about preparing to move their ICT into the cloud, but what does this truly mean? That their IT department has validated the systems they are choosing to use in a virtual environment or does it mean that an organization has understood that moving ICT into the cloud is as serious and potentially disruptive as any business transformation?

There seems to be a growing view that Cloud Computing will deliver cost savings to a business’s ICT spend and based on many industry reviews this seems to be accurate, at least at first. From a starting position when migrating to cloud computing businesses will most likely see an improvement in their IT and Communications spend through increased scalability; however the challenges occur when businesses are seeking to leverage the benefits of virtualization across their supply chain and their internal processes which tend to take longer to materialize in any type of transformation project.

Anyone who has undergone an internal transformation will know there are three key aspects to any business change, these are – People, Process and Systems. It is interesting to note that when considering a shift to cloud computing, businesses seem increasingly comfortable and aware of the “Systems” implications. However during a cloud migration businesses are not paying the same level of attention to People and Process, these two areas are of particular importance in an era of globalization and connected business environments. Through globalization many businesses today have staff/resources distributed around the world, either through driving efficiencies, optimizing costs or to ensure close engagement with the end customer. The People aspect of change brought about by Cloud computing needs to capture not only the impact of latency tolerance for people to access systems, but also ease of use, language, local vs. central support and managing legal and regulatory changes where people are located. Equally, a business’s processes increasingly tend to include other organizations as they no longer tend to manage from design to implementation to in life support without input from other partner’s, suppliers or even customers. These developments require greater governance and adaptability to change, something which businesses may not have had to consider in a static ICT environment where changing a vendor or system had a more limited impact to the business.

This is not meant to be a warning against the benefits of virtualisation - aka Cloud Computing, but to make sure that as a business community we look at the transition to Cloud Computing as being as broad and potentially impactful as any business transformation we have undergone or are considering. Whilst many are looking at the short term gains that cloud computing can offer, it is actually the longer term benefits of cloud computing which are more exciting as these can lead to greater business agility, a shift in aligning business performance with supplier cost and creating a working environment for business led innovation.

I am sure many out there who will read this and think I am over complicating something which is simply a managed service, yet the goal for any business must be how to drive sustainable growth, in a market where the only constant is change. It is therefore important to ensure any project is providing a path to sustainable growth, there must be a longer term set of measures for success, such as identifying efficiency benefits through unit utilization (staff or resources), or being able to demonstrate increased alignment between the pull of business requirement and the push of ICT costs, resulting in reduced bench cost and greater business agility.

Are we ready for Cloud Computing, the answer remains yes - surprised right? -, although it might sound odd with what I have just outlined, but as businesses we do have the means with which to ensure a successful migration to cloud based working environments, we need only make sure we treat this as a business change not only a technology shift. All businesses have been through some form of transformation in their business, whether that is to adapt to the market, seek out new opportunities or drive business optimization we need to refresh our learning’s from these projects to ensure a path to the outcome we are looking for in the longer term with Cloud Computing. As with any Transformation we must keep in mind the three factors of people, process and system whilst maintaining a forward looking view on the benefits to a sustainable growth outlook all the while keeping in mind the age old saying – Preparation Prevents Poor Performance!