With almost half of today's CIOs planning to shift the majority of their applications and infrastructure to the cloud in the next four years, CIOs have an opportunity to 'reimagine IT' by looking at current technologies and asking what would be possible if they were deployed in other ways.
Stories by Divina Paredes
Tracy Voice has been appointed CIO/director of business technology and information services at Ministry of Agriculture and Forestry.
Before this, she was on contract as programme manager at MAF, working on the latter’s merger with the Ministry of Fisheries. She will report to Nigel Prince, deputy director general corporate services at MAF.
“I thought it was delusional,” said Garry Rich when the chief operations officer of Mantra Group told him not to be surprised if their company doubled its operations in 12 months.
Rich is group general manager for IT at Mantra, which owns hotel, resort and retreat properties in Australia and New Zealand.
IT organisations can not adopt a “wait and see” attitude when it comes to the cloud.
John Brand, vice president, and principal analyst, CIO Group at Forrester, observes that in the past, “organisations had the opportunity to sit back and evaluate [technology] and in many cases they decided to wait before adopting.”
“But the level of interest and activity in the cloud from the business was something that took IT by surprise,” says Brand, as he releases the results of the latest Asia Pacific Cloud Index.
The annual survey, conducted by Forrester for VMware, finds cloud adoption continues to accelerate across the region – with 64 percent of Asia Pacific organisations already using or planning cloud initiatives – an increase from 59 percent in 2010 and 22 percent in 2009.
New Zealand and Australia continue to lead the region in cloud adoption, with 67 percent using cloud technologies, up from 60 percent in 2010.
“We were expecting this kind of industry penetration to take around five plus years. It has happened within three years,” says Brand at the annual vForum in Sydney.
In terms of adoption plans, private clouds still far outweigh public clouds, and 41 percent of respondents plan to deploy both public and private clouds, up from 38 percent in 2010.
“Continued interest in both private and public clouds suggests barriers to adoption are considered challenges, not show stoppers,” says Brand.
Cost savings remain the primary driver for cloud adoption – cited by 55 percent of respondents. But more respondents from New Zealand and Australia, along with Korea, view the cloud as a strategic initiative compared with their counterparts across the region, which cite cost savings as a major driver.
Duncan Bennet, managing director, VMware Australia and New Zealand, say these findings suggest the majority of enterprises across both sides of the Tasman are ahead of the game when it comes to cloud computing, and are moving past technology concerns to impact on the business.
Concern around data privacy and control has likewise replaced security as the main barrier to cloud adoption, particularly in ANZ, Singapore and Malaysia.
The survey also finds ANZ organisations leading the way in virtualisation – 76 percent of organisations willing to consider virtualising their most business critical applications, an increase from 75 percent in 2010.
Todd Neilson, co-president, application platform at VMware, says cloud computing has empowered the users to bypass the control of IT. “With cloud computing, users are saying if IT can’t respond to my needs, I am going to go elsewhere,” says Neilson.
He cites the experience of a CIO of a US financial organisation who wanted to find out how much “rogue IT” was in use and pulled out the expense report for Amazon Services in the month of December.
“I was emotionally prepared for the number to be $20,000 to $30,000,” Neilson quotes the CIO as saying, but the figure he got was for $400,000.
He says a challenge for CIOs across the globe is trying to find out how to transform IT as a service.
“We are at the end of the Windows era, we are on a post PC-era,” says Neilson.
He says that during a recent meeting with CEOs in Silicon Valley, nearly everyone had a laptop or an iPad. In this environment, he says, “IT needs to be a universal services broker and connect to the variety of devices.”
Pieter Bakker joined Ports of Auckland (POAL) as CIO/general manager information technology four years ago, following two decades of IT leadership roles across various New Zealand corporates.
It is called “the garage effect” and it is a nod to the humble origins of some of the giant companies in Silicon Valley.
David Hunter, chief technology officer, platform security at VMware, predicts the rise of the ‘garage effect’ for people working in today’s cloud and virtualised environments.
Attracting -- and keeping -- IT talent is an ongoing concern for NZ organisations, even if it was muted during the downturn. At a CIO roundtable sponsored by Absolute IT, ICT leaders from across sectors share insights on how they face this evergreen challenge. Here are excerpts from the discussion.
David G Thomson travels around the globe advising on how companies can be "recession proof", or thrive through the most challenging markets and economic cycles.
Michael Snowden has mined his PhD research – completed 31 years ago – for a cloud service to be deployed by OneNet, of which he is chief executive.
The product, Profit Maximising Software, is a set of software modules which mathematically determines the optimal operational and financial decisions to maximise profits, based on uncertain forecasts of future opportunities and current financial position of an enterprise..
In a background paper on the project, Snowden explains the software uses ‘Monte Carlo methods’ - a reference to thousands of simulations that are run to build an overall ‘roulette wheel’, or probability distribution, of demand.
The uncertain future is tested under thousands of different possible combinations of outcomes to help determine the overall likely future, given the best guesses that can be made today. Future demand is projected with probability estimates for all services and other key variables.
The software calculates the absolute maximum profit that could be obtained, given the assumptions made.
Snowden says his PhD research used simulation and optimisation to gain these results but was hampered by the cost and availability of high performance computing at the time. In the late 1970s, for instance, building a financial model of a firm could cost up to hundreds of thousands of dollars.
He pitched the software to be part of this year’s Infosys 345 Business Project at the University of Auckland. Three senior students from the Department of Information Systems and Operation Management: Michael Hoskins, Kyle Folster and Joshua Monteiro, worked with OneNet to apply it to actual business scenarios.
Avneesh Saxena, group vice president, Domain Research Group, IDC Asia Pacific, predicts the rise of a sourcing specialist who will act as a trusted advisor on the cloud for CIOs.
Todd Humphrey, executive vice president, business development, Kobo, recently visited New Zealand for the local launch of the e-book retailer. During the interview with CIO, he brought with him two devices - Kobo’s touchscreen e-reader and an iPad that became important backdrops to the discussion.
Here are some excerpts from the interview.
CIO: Tell us about Kobo.
Todd Humphrey: The first thing is, we are a technology company that is enabling the consumption of content. We do two things - we build hardware and we build applications for people to consume that content.
Kobo is founded inside of Canada’s largest book and music seller Indigo. We spun out of Indigo about 20 months ago and we have gone from 30 to 300 [staff]. Our user base is approaching 4.5 million users in a hundred countries. It is being run by someone who is very technical and business savvy [Kobo CEO Michael Serbini was CIO of Indigo].
This combination has allowed us to innovate faster than anywhere else in the world. We are the first company to launch a cloud reading service. We have one of the world’s largest digital libraries of two-and-a-half million books. We have applications on our own devices and other platforms like Android and BlackBerry. We are a cloud based service - we allow users to access any piece of their content from any of their devices and they are always updated.
CIO: How do you aim to stand out from other e-book providers?
From the Amazons of the world? There are a couple of things. The device itself is one of the first touch screen devices with an e-ink screen; the second is the form factor. It is an open platform. We use EPUB as our standard and with that have access to 1.7 million free books and allow people to access content from various sources. We believe customers want to have access to that content and want to buy content from various sources and we have developed a platform where you can go and do that.
What is the enterprise use for it?
It is more of a consumer device. Having said that, we are starting to see more of the enterprise start to pick it up as more functionality is added. We have seen it with the iPad. There are a number of companies – large ones – using this as an incentive or giveaway to employees to access content – manuals and analyst reports.
If employees already have tablets, why do they need an e-reader?
They are just different devices in terms of usability… Kobo is a through and through reading device so there is no email, no internet, no Angry Birds.
But some people like online games like Angry Birds.
If you like distractions, this [holding the iPad] will give you a million apps to distract you. Our customers told us one of the things they love about this device [Kobo] is the simplicity of it. You can access your content immediately and give you the ability to do so in a way that is just a little bit easier, simpler than an iPad.
Why should CIOs or other executives check this out?
We are moving to what was half of the publishing industry going from black and white books to digital, so there is a huge evolution, a huge transition to how people are consuming content. If you are in the content business to any degree, this is coming at you.
From a managerial standpoint, if your employees engage with content, this is probably how they are going to engage with half of it. How do you construct or push it [information] out to your employee base in a form that is readable?
New Fonterra chief executive Theo Spierings says information technology is “extremely important” to maintain market competitiveness for the company.
At a press briefing on his first week on the job, Spierings, joined by Fonterra CFO Jonathan Mason, outlined IT’s role in the dairy giant’s supply chain, and providing critical data to staff and customers.
Consumerisation of technology – where workers use their own smartphones, tablets and social media like Facebook and Twitter for work – is accelerating in New Zealand.
But the majority of employers have not yet implemented programmes to proactively manage, support and secure these devices.
If the Arab spring led to the downfall of dictators, so can CEOs – and CIOs - be toppled into an equivalent social revolt by angry users, customers and business partners.
Salesforce CEO Marc Benioff, speaking at Dreamforce 2011 in San Francisco, predicts a ‘corporate or enterprise’ spring for heads of companies that do not take the lead to become a ‘social enterprise’.
“All of us are facing transition from physical to virtual world,” says VMware CEO Paul Maritz. “The whole industry has come to grips to the fact that we are going into more virtualised, cloud-based world.”
Maritz points out more than 50 percent of total workloads are now virtualised and this has implications for the industry. There are now more than 20 million virtual machines ticking away around the globe, a new VM is born every six seconds, he says.
The cloud era represents major interaction between consumerisation of IT on one hand and traditional enterprise IT on the other, working with each other for a new synthesis that will redefine IT over the coming decade, says Maritz. “The question is how to collectively transition between these two areas in a smart orderly way.”
“We need to make things brain dead simple... you have to turn it on and that is it,” says Maritz at the annual VMworld conference being held this week in Las Vegas.
Maritz says the mainframe era was about automated bookkeeping. The client server era on the other hand, saw hundreds of millions of new users through PCs and from this came a new set of technologies.
In the cloud era, millions of new users and devices are coming into play. Just three years ago, he says, over 95 percent of devices connected to the internet were PCs. Three years from now, that number will be less than 20 percent – more than 80 percent of devices connected to the internet will not be Windows-based PCs.
“What you do on your new devices is not the same as your old PC,” he says. “We have to think about the next generation of developers and canonical apps.”
Managing services, not servers
The transition to the post-PC world is about using all the devices and not just desktop, having universal access to apps and data wherever we may be. “It is not just about machines but tools to succeed collaborate in real time in a connected enterprise,” says Steve Herrod, VMware CTO.
We are in one of the biggest transitions of technology – from a focus on individual servers and desktops, to services and people, he says. “We want to manage services, not servers.”
Herrod says the transition to a post PC world is about using all devices and not just the desktop, and universal access to apps and data wherever the user may be. The goal is to succeed and collaborate in real time in a connected enterprise.
Herrod points out the steps that can be taken to simplify management of IT in this type of environment. This involves putting a policy in place that is assigned to a user, not to a device.
“It should just work and it should work well,” says Herrod. The key is to automate. “A truly intelligent infrastructure should automatically respond,” says Herrod.