Steria and Sopra merge to get on more supplier lists

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Interesting story last week that two of France's IT service providers have come together in a "friendly" merger that will cut costs and probably more importantly make them more attractive to potential customers and get them on more multi-sourced IT lists.

The merger will create a group with €3.1bn sales, 35,000 staff and customers in 24 countries. It is also expected to cut operational costs by €62m a year.

According to the people in the industry that I have spoken to this is a reflection of the multi-sourced outsourcing environments at big companies today. As a consequence suppliers are trying to make sure that they are on "the list" of suppliers that businesses use.

Today businesses are increasingly drawing up lists of suppliers they will buy from and are splitting up the services they buy between different suppliers. Suppliers have to be on these lists to stand a chance.

When I ask about certain suppliers I often get the response from experts saying they are on the list or not as the case may be.

Steria is the better known brand in the UK, with sales worth over €700m, compared with Sopra's €80m UK sales. The coming together of Steria and Sopra will put the companies on more lists and enable them to offer more services to the lists.

Outsourcing advisor  Jean Louis Bravard said businesses and their third party advisors compile lists of suppliers that they will consider for projects. "With Steria and Sopra combined they will get to the €3bn revenue mark which will put them on more lists."
And that list is becoming attractive. In Europe and particularly the UK IT outsourcing is steaming ahead it seems.

The latest figures from ISG reveal that in the UK there were 59 contracts signed in the first quarter of 2014, worth €1bn. This represented a 66% increase in value compared to the same period a year ago and the highest number of contracts in a single quarter for three years.

So what do you need to get on "that list?"

Could Facebook/bank destroy the retail banking giants?

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I have written a few articles recently about how large internet companies like Google, Facebook and Twitter could be the biggest threat to retail banks for many of their services.

Facebook is moving into financial services. Read this article I wrote.  In the meantime banks are struggling with a lack of consumer confidence, pressure from regulators and creaking IT systems.

Why shouldn't a massive internet firms offer a current account for example? They have the technology and the customer trust. They already hold lots of customer details. Retail banks like RBS, lumbered with legacy IT, might end up being just B2B, leaving internet firms to offer retail banking services.

A good contact of mine in the banking sector believes major change is on the horizon.

He said: "I think Amazon, Ebay and Paypal will become banks soon."

"The dinosaur banks won't be around in 10 years except for business to business products. Cost base too high and service level too low combined with poor reputations and pressure from regulators, governments, public and media. The writing is on the wall, extinction is inevitable, but they are in denial at the moment."

I hope Amazon's pay as you go cloud is easier to cancel than Lovefilm

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Could cancelling Lovefilm subscriptions be the only blemish on Amazon's almost dreamlike customer services?

I recently wrote an article on this blog about Amazon Web Services. The article was about how IT services firms all want to be friends with AWS so they can build services on top of the raw computing power that AWS offers. Here is the post.

I then interviewed AWS's UK managing director and subsequently wrote this story.
It is an article of positives but I should have asked the managing director of AWS for some advice about cancelling my Lovefilm subscription (owned by Amazon).

I have used the "Lovefilm by post" service for years and it is a great service. Problem is my wife and I don't get time to watch the films. Last year I tried to cancel and gave up. I even sent an email to Lovefilm about this and had no response. It seemed inevitable that I would have to call them. I put it off and then ended up staying a member.

But having looked at the latest unwatched film sitting next to the DVD player unwatched I decided to try again. I failed again. I followed all the instructions and have not managed to do it.

I have to say I have never had the slightest inkling to complain about Amazon. We are huge users of Amazon for pretty much anything we need that can be bought online, but where is the Amazon perfect customer service when it comes to cancelling Lovefilm by Post?

As I said earlier I hope it is easier to unsubscribe from a cloud service.

Anybody else having the same problem?

Could IT arise from the Ukraine turmoil stronger?

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I was one told by someone that It suppliers have an attitude of "any news is good news." What they meant is if a journalist is writing about you in a reputable magazine it is good news even if the actual news isn't good.

In other words if you are on the journalists radar it is good news.

The troubles in Ukraine, a country still in limbo, have certainly increased the number of IT stories about the country in my inbox.

I was actually looking at Ukraine's IT services sector before the troubles really kicked off because a contact of mine, Sam Kingston, told me he was leaving T-Systems, where he was UK head, and joining Kiev based Ciklum as COO.

We also wrote an analysis about the country's IT sector back in 2011.

But there is nothing like a world event to bring focus on a nation. I hope it isn't all negative.
The Ukrainian IT sector is certainly pulling out the stops to get its message out loud and clear. Just this week I have received two separate press releases about how the Ukrainian IT industry is reacting to the political crisis.

The first was about the Ukrainian government and IT Industry's plan to position Ukraine as a European IT powerhouse by 2020. It has launched a working group.

"We wish to transform the Ukrainian economy from a resource-based economy to a knowledge-based economy" said Pavlo Sheremeta Minister of Economical Development and Trade.

The plan wants to create 100,000 new jobs in the IT sector by 2020 and generate over $10bn export revenues from IT services (mainly from EU and the US). It also wants a $1bn investment in modernizing the Ukrainian education system.

Then I had something sent to me about how despite the troubles Ukrainian IT Industry growing. The press release was about the launch of Ukrainian Information Technology (IT) Development Center.

Its founder Ihor Pidruchny hopes to raise awareness to promote the Ukrainian IT industry. It  will feature a social media campaign on Facebook, Twitter and LinkedIn to encourage interaction with Ukrainian IT talent. The initiative's mission is to let the world know that despite the current political situation, the Ukrainian IT industry is going strong.

Many in the IT services sector see countries in central and Eastern Europe as the main threat to India's offshore dominance. These nearshore destinations as they are known offer lower costs but close proximity. They also have a very strong IT skills base, party the legacy of the former Soviet Union.

Read this written in 2011: Outsourcing in the Ukraine: benefits and drawbacks

Also read: Report on Central and Eastern European nearshoring.

CIOs are in a state of flux but it's just cultural

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Technology is changing. The consumerisation of enterprise IT is putting pressure on CIOs to change how they operate.

So how do CIOs retain relevance in a world where business executives buy their own devices and expect to be able to connect to enterprise apps anytime, anyplace?

Steve Nice CTO at IT services firm Reconnix wrote this guest blog in the subject.

The Changing Role of the CIO

By Steve Nice

"The role of the CIO in 2014 is in a state of flux. CIOs are increasingly becoming overlooked, ignored or side-lined by their fellow c-suite executives, despite increasing reliance on technology, and therefore the IT department, to ensure the success of businesses the world over.

Reconnix recently commissioned research, the results of which highlighted how technological advancement will affect current CIOs. A striking 73 per cent of IT leaders were unsure that the CIOs of today will be the right people to lead IT within UK businesses in the next five. This begs the question why do CIOs feel so disenfranchised and detached from the decision making process?

Unsurprisingly it is those who are stuck in their ways and reluctant to drive change that feel most at risk. Gartner has stated that only 18% of CIOs are responsible for digital. This statistic is clearly far from ideal given the increasingly digital nature of the world.  A new generation of CIO, who drives the corporate culture away from digital deficiency, is helping re-address this. At the same time our research indicates 37% of today's IT leaders still believe that not enough is being done within their organisations or the industry to guarantee that future CIOs will have the skills needed to achieve business objectives.

Most importantly, with trends such as mobility, cloud collaboration and BYOX still on the rise CIOs must understand the ways that new technologies can, and do, help facilitate business efficiency and flexibility. Cloud computing services for example benefit the CIO, and by extension the business, by offering improved collaboration, as well as reducing the complexity of the IT infrastructure.

As much as the technology is important, it's also a question of engagement. If a CIO is stuck in their ways then they, and their business, will be left by the wayside whereas a forward thinking CIO, who engages with the board, will help produce real change. This is why it is essential for CIOs to be able to communicate effectively with other department leads in the organisation. The best communication is multi-directional - the CIO will need to take on board what other areas of the business need to succeed and interpret how to achieve these goals with technology solutions.

It's as much a cultural shift than anything else. If IT leaders approach their role as delivering 'Business as a Service', if they push an open, innovative agenda whilst persuading the board how change will benefit their aims, but also the wider aims of the business, then their position as a future CIO will be cemented."







High Performance Computing on demand attracts SME interest

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High performance computing in the cloud will make supercomputing a possibility for companies of all sizes.

I have written about the attraction of public clouds such as Amazon Web Services for raw computing power to support things like app dev   and here in this guest blog post from CEO Bull UK & Ireland, Andrew Carr, we learn how high-performance computing is moving from the realms of academia and into the SME.

High Performance Computing on demand attracts SME interest

By Andrew Carr,

"We are seeing a radical shift in the high-performance computing (HPC) market today. Traditionally, it has been dominated by academic institutions with the necessary funding to take on big supercomputer projects. This is changing fast.  Fuelled by an understanding of HPC's potential to reduce 'time to insight' and accelerate time-to-market, commercial organisations from engineering firms to geoscience companies are expressing interest in HPC. In the UK, the Government is playing its part too, recently announcing its intention to invest £270 million into research into quantum computing.

Talent and Technology - The Magic Formula for SMEs


The latest developments in the HPC market are now even bringing HPC into the orbit of small to medium-sized enterprises (SMEs). The emergence of a cloud-based approach to HPC - HPC-on-Demand is helping this previously neglected group harness the power of supercomputing for digital design and simulation and compete on a level playing field in this area with their larger enterprise peers.

This innovative approach enables SMEs to buy access to a supercomputing resource provided through the cloud on an as required basis rather than forcing them to make an upfront investment in a complex IT hardware implementation. They don't waste their investment by having infrastructure running idle. 

The key to the success of any HPC-on-Demand service, especially for SMEs is flexibility. The customer can choose everything from the operating system to the task scheduler and the size of the storage capacity used. They should also have the flexibility to choose from a range of different services whether their preference is for Infrastructure as a Service (IAAS), Platform as a Service (PAAS) or Software as a Service (SAAS).

The other area that SMEs need to address is talent. Skills shortages still represent an obstacle to HPC's long-term success - and SMEs with their limited resources often struggle more than their larger enterprise peers to attract the right level of graduate.

Today, many universities in the UK are developing courses that respond to industry's needs. Also, there remains a rich source of people, even among non-technology graduates with the potential to become excellent HPC consultants.  The question is how can industry attract and then develop this talent?

Some technology businesses are doing this themselves and building networks of HPC specialists to identify and develop people. Others are working with universities to provide post-grad and pre-grad education to introduce valuable skills to the market. SMEs can often tap into this emerging skills base by bringing in freelance consultants with the right level of expertise on an as required basis.

When they engage with recruiters to look for full time staff or freelance consultants, SMEs should look to deal with specialists that can spend time identifying what each is looking for. That means they may only deliver up two or three candidates for each available HPC spot but those candidates are more likely to fit the bill.

Delivering Enhanced Competitive Edge

Talent and technology are now coming together within SMEs, enabling them to profit from the new focus on HPC.  With expert freelance or full-time consulting staff increasingly in place, SMEs are benefiting from the ability of HPC-on-Demand to drive 'time to insight' - the time taken between the presentation of the problem and reaching an understanding of how to solve it.

By shortening this cycle, SMEs have the opportunity to cut the product development phase, increase innovation time and reduce time to market. HPC-on-Demand gives SMEs the opportunity to drive through innovation, understand more complex issues, achieve more accurate and predictable outcomes and make solutions or services development faster and more efficient.

Perhaps most importantly of all, HPC-on-Demand enables SMEs to compete on a much more even basis with their larger rivals than ever before. It's an unprecedented shift in the balance of power and with the market set to develop further in the future, it is likely to be a sustained one."

OFT's thinly veiled report to Tories that capitalism doesn't work

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Milton Friedman will be turning in his grave as a report published this week seems to imply that his laissez-faire economic stance doesn't work.

The OFT's report into government procurement of IT says little more than the plethora of similar reports published in the last couple of years.

However what did strike me is how the reference to suppliers co-ordinating tacitly to fix prices. The report suggests that although there is no evidence suppliers could be dampening competition through "implicit understanding of each others' future actions, rather than through arrangements." In other words they know what each other will do so they deliberately and covertly keep prices at a level that suits them.

If the suppliers are left alone and prices are related to supply and demand then surely the price will reach the right level. Unless the private companies have it in their collective interest to prevent this from happening. So capitalism doesn't work then?

Here are a couple of articles I wrote about the report.

TechUK criticises OFT's reporting of IT cartel accusations

OFT tells government how to improve IT procurement


Could Switzerland's IT services sector banish its Cuckoo Clock Image?

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As Orson Welles in the Third Man said: "In Switzerland they had brotherly love - they had 500 years of democracy and peace, and what did that produce? The cuckoo clock."

Continuing the film theme, this time Monty Python, we could ask the question what have the Swiss every done for us? The answer might well include the Cuckoo clock, banking, cheese and chocolate.

But according to a press release we received this week, IT services accounts for six times more export value to Switzerland than cheese and chocolate put together.

In fact exports of Swiss IT products and services were worth 8,814 billion CHF (over £6bn in 2011) compared to a mere 1,335 billion CHF (just under £1bn) worth of cheese and chocolate.

A report, from ICT Switzerland, lists IT among the top ten main export groups, according to foreign trade statistics from the Swiss Customs Administration.

According to one supplier IT services such as data storage in Switzerland are becoming increasingly popular, as global companies are choosing to take advantage of the country's strict privacy laws.

The NSA scandal is only going ton increase interest in storage in Switzerland said Mateo Meier, director of Swiss data storage company, Artmotion. "Switzerland has previously been associated with luxury food and jewellery exports, but now we are receiving international recognition for IT services as well. The country has traditionally acted as a hub for multinational corporations' financial needs, and we're using the same experience and expertise to become a big player in the IT industry.

"Within the IT industry, private data storage using dedicated servers has become highly sought after. No longer happy with cloud computing and US data storage companies, firms are turning to so-called 'Silicon Switzerland' to entrust important data and business secrets. In light of the NSA scandal, we've seen more interest from companies across the oil and gas, financial and retail sectors."

Freedom of Information laws to extend to IT outsourcers

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It looks like the government will soon extend the Freedom of Information Act to private companies including IT suppliers to government.

A recent Public Accounts Committee (PAC) report into government procurement reported that suppliers "were content that Freedom of Information provisions should apply to public sector contracts with their companies."

Liberal Democrat Simon Hughes said the change would be written into the contracts of companies after the publication of a new code of practice, which should be in place by the end of this year.

"We intend to publish a revised code of practice to make sure that those private companies that carry out public functions have freedom of information requirements in their contracts, and go further than that, and we hope that will be in place by the end of this year."

This will improve the transparency of suppliers and address concerns that they are not open about the details of contracts.

The PAC report said: "Government is clearly failing to manage performance across the board, and to achieve the best for citizens out of the contracts into which they have entered," said the report.

"Government needs a far more professional and skilled approach to managing contracts and contractors, and contractors need to demonstrate the high standards of ethics expected in the conduct of public business, and be more transparent about their performance and costs."

It would make a change if a report into government procurement actually results in changes, rather than just pages and pages in report after report coming to the same conclusions with nothing actually done.

Let me know what you think? Are you tired of endless reams of paper being wasted on reports into government IT procurement?

Ukrainian IT industry calls on new government to invest time and money in it, despite troubles

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With all that is happening in the Ukraine it is easy to forget that the country has international businesses that need some of the government's attention.

A contact of mine, Sam Kingston, is heading out to Kiev to become COO at IT services firm Ciklum.

He told me that Ciklum CEO, Torben Majgaard, has written an open letter to the new government based in Kiev on behalf of the country's indigenous IT companies, to ask for it to continue to invest in the UT sector despite the political turmoil.

I am waiting to receive the full letter and will go into more detail when I do.

The Ukraine offers highly skilled IT specialists at a low cost for companies looking to develop projects within Europe. But while the honesty of its people appears to be a key selling point, problems of corruption and the social unrest remain. Read this written in 2011: Outsourcing in the Ukraine: benefits and drawbacks

Also read: Report on Central and Eastern European nearshoring.







Investigating outsourcing gives birth to its first book - Why do large IT project fail question inspires writer

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A couple of years ago I did a series of blog posts featuring the views of experts on why large IT projects fail. I had 27 experts ranging from academics to IT services experts.

I enjoyed the series as did readers. Well it seems some were inspired.

Here are links to the series in full: Part 1 Brian Randell, part 2 Anthony Finkelstein, part 3 Yann L'Huillier, part 4 James Martin, part 5 Philip Virgo , part 6 Tony Collins, part 7 ILan Oshri, part 8, Robert Morgan part 9 Sam Kingston, part 10 Peter Brudenal, part 11 Mark Lewis,  part 12  John Worthy, part 13 Stuart Drew, part 14 Milan Gupta, part 15 from a reader known as Matt, part 16 Fotis Karonis, part 17 Fergus Cloughley, part 18  Steve Haines, part 19 David Holling, part 20  Bryan Cruickshank, part 21  Rob Lee, part 22 Tony Prestedge, part 23 BG Srinivas, part 24 Craig Beddis, part 25 Stuart Mitchenall, part 26 Colin Beveridge and part 27 from Trevor Christie-Taylor 

Inspired by the question, Mark Seneschall starting working on my challenge of summing up in a few hundred words why large IT projects fail? He ended up writing 100,000 words and has published a book. The anatomy of IT projects: why they're hard, and why they fail, can be found here.  And here is a website about it.

This is what Mark said about how a question posed in this blog inspired him to write a book.

"I suppose I'm something of an IT projects 'nerd' - I'm not an IT technician at all, my background is commercial, finance and control, but as I describe in the book I got sucked into these sorts of initiatives from the business side of things, and found them the most difficult, frustrating, horrendous - but also the most challenging, stimulating and ultimately rewarding - things I got to do in my entire career.   From about 2002 onwards - at the same time as NPfIT was going on - I was working on some very big projects, and I knew how hard these were proving.  While NPfIT was another order of magnitude bigger than what we were attempting, given my experience I felt I could understand and identify with some of the challenges it was struggling with. As a regular reader of Computer Weekly, when you posed the question in your blog, I thought I had something to contribute, and I started trying to draft my 200 words.

But at that time, although I'd begun work on the book, my focus had been more on the question 'why are IT projects hard?', principally because (as I describe in the introduction to the book) I'd been struggling to explain this to a company who I was then working with, who had kicked off a project to install a new end to end system to handle most of their activities, but had little concept of what this entailed.  So my initial answer to the question 'Why do these things fail?' was 'Because they are hard'.  But then I thought about it some more.  Being hard obviously raises the bar, but as long as you acknowledge that they're hard, and respond accordingly to the difficulty, then you should still be able to succeed.  For example, while it might be hard, say, for me to run a marathon in 3 hours, if I prepare properly for it, train hard, eat properly etc etc, ultimately I ought to be able to do it.  So it isn't actually the fact that these things are hard that causes them to fail (even though they are hard), it must be because the response is inadequate.  This realisation, which arose from the thinking I did in response to the question you'd asked, and when combined with this other question of 'why are these things hard', led me particularly to come up with the 'opposing forces' concept I discuss in chapter 2 (ie that the complexity inherent in any project - IT or of any other type - needs to be met by a sufficient response in order for the complexity to be addressed and the project to succeed), prompted the discussion in chapter 6 around the factors that cause the response to be insufficient to address the complexity), and resulted in what is probably my most important conclusion - that the key to success in these sorts of initiatives is understanding as comprehensively as possible the complexity that you are likely to encounter when undertaking any such project before you start, and ensuring you are as well positioned as possible to address it.  Perhaps this seems obvious - but on the other hand, as the discussion in Chapter 6 highlights, there are lots of reasons why organisations in practice very often do not do this - and the evidence from NPfIT and any number of other projects (and my own experience) supports this.

Ultimately, therefore, the question you posed really helped take my thinking to another level, and made the book a much more powerful and distinctive analysis than it might well otherwise have been..."

Preferred Supplier Lists (PSLs) are archaic and hold businesses back

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I met up with tier-two Indian IT services firm ITC Infotech for a catch-up on its progress in Europe. Back in June Hardeep Garewal, who is the head of Europe, told me some of the company's plans.

ITC Infotech has an interesting history. It was previously the internal IT department at Indian conglomerate ITC Ltd (originally Indian Tobacco Company), which has revenues of $7bn and is focused on fast moving consumer goods, hotels, paperboards, paper & packaging and agri-business.

ITC Ltd still owns ITC Infotech and is a major customer but spun it out in 2000 to serve other clients.

Although the company has big name customers Garewal told me as a tier two supplier ITC Infotech is challenged winning business in large companies even if the IT leaders there want their services. This is because many of the big companies have Preferred Supplier Lists (PSLs) and they can only buy from companies on these lists for a set period of time.

Garewall believes in today's IT and business environment where businesses want to be quick to market with new products, need to be innovative, or need to adopt new technologies this model doesn't work.

"We often speak to CIOs about our services and they tell us they want the service but can't even consider it for a year because of the PSL," he says. He said a system should be created where a CIO can buy certain services that are not on the list if it meets a business need.

Obviously this is good for companies like ITC Infotech, but it is a valid comment. New technologies from new suppliers that have the potential to change business come out regularly these days. Business need to update their procurement rules to allow them to benefit from rapid IT changes.

Smaller suppliers are innovative and can offer services that might not be available at bigger players on preferred supplier lists.

Garewall told me about a service ITC Infotech offers to customers, which I found interesting. It involves creating appstores for businesses.

For one of its customers in Holland, a large corporate, the company has introduced an app that means IT departments don't even have to get involved in setting new starters up

A new employee joins the company and has a job profile assigned to them. When they log in they are automatically presented with all the software they need and are approved to use. They simple check boxes and are given access to cloud based software such as SAP.
This sounds good particularly with the increasing take-up of BYOD schemes, which threaten to put pressure on busy IT departments.

This makes me think that appstores will replace PSLs.


Every IT services firm wants to be Amazon's friend

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When the name Amazon comes up in a conversation with an IT services firm there is never a bad word said about the company. Amazon has become the go to company for raw cloud computing resources.

Most suppliers will have a dig at a competitor when you mention them but Amazon is not seen as a competitor. It just provides the raw materials for the IT services firms to build services around.

I was meeting a cloud supplier recently and its UK head said if a customer can benefit from a public cloud service it will recommend Amazon. But he said customers need a supplier to manage their cloud environments and help them understand when choosing between things like public cloud, private cloud or hybrid cloud.

Raw cloud computing power from Amazon has seen huge falls in cost as a result of economies of scale.

It is another industrial revolution with the cloud powering it rather than coal. But just buying coal does not guarantee success if the machinery is wrong.

So you would think that enterprises would be taking up cloud computing services by the pipeload, but not so. One of my colleagues Jim Mortleman wrote an interesting article about the Cloud Expo Europe conference in London.

The article, which you can read here, states that: "IT departments are failing to implement cloud in the way businesses want, and providers are selling solutions in the wrong way."

In the article he said HSBC's global head of innovation, Barry Childe, is calling on suppliers to package their solutions and services in a way that was more relevant and understandable to business users of cloud services.

Don't let restrictive policies hold back your BYOD plan

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With BYOD promising so much I don't think any companies I have spoken to in the last year don't have a BYOD plan. The concept of BYOD and its benefits is easy to grasp, but putting it in place and making it work for the business and the employee is not so simple.

IT services firm Bluesource  provides managed services for businesses around things like Microsoft Exchange. It is increasingly having to help customers with BYOD programmes.

I met up with Gavin Camilleri, managing director at the company, recently and he agreed to give his thoughts in a blog post.

Here it is.

BYOD is here to stay - manage the risk and optimise it


By Gavin Camilleri

"What is the trend?

With growth statistics suggesting that 40% of workers are using their personal devices to access business applications and resources, BYOD is a trend businesses can't ignore.
Although there is growing pressure on IT to manage the risk posed by BYOD, there is a real opportunity to turn BYOD to a business advantage by driving improvements in employee productivity, performance and adding extra support for the growing numbers of remote and mobile workers.

Businesses benefit from employee expectations as they no longer see "work time" and "personal time" as separate categories. This is because a growing number of employees prefer to use a single tablet for work and personal use - with access to corporate email and other business applications, outside business hours.

However, there is a growing pressure on IT to manage the risk posed by BYOD. Gartner predicts that by 2016, 20% of enterprise BYOD programmes will fail due to deployment of mobile device management measures that are too restrictive. The key is the introduction of appropriate BYOD strategies that manage the risk and optimise the business benefit.

What do businesses need to think about?

Mention BYOD and the discussion automatically turns to Mobile Device Management (MDM) and this is a major challenge area for IT. To achieve success, the most appropriate MDM technology for the business units must be established. If running multiple MDM's - Active Sync, BES, Good, Mobile Iron etc - an organisation must manage these and migrate users and policies too. 

But for successful BYOD and mobile implementations businesses also need to consider:

-The suitability (compatible and user friendly)  of  key business applications for  mobile devices and the delivery of content in a consistent manner to the user device of choice

-Define what business processes are required by mobile users, ensure that vendors support these workflows satisfactorily on mobile 

-Establish which upgrades are required for key business applications, as more recent versions of the software provide a richer mobile experience

-Identify if the same applications can help businesses to enforce a mobile management strategy, if permissions can be allocated for specific work groups, including mobile users/remote workers

-Examine if this will prompt the need for an overhaul of permission levels for all key business applications, the impact of mobile users and single sign on policies

-Ensure that vendors understand the importance of mobile compatibility in a business and can they provide an independent and expert opinion for the applications they offer

It is also crucial to review security policies and governance requirements. Governance can be considered a blocker to BYOD as businesses, as it's perceived that all data needs encryption and all business related calls need recording. A review of governance requirements may however reveal that although this may be true for some users\data, it does not apply to everyone, and a more standard approach for the majority maybe acceptable. This will lower the TCO and ultimately make it a more viable solution."

T-Systems UK wants its identity as network becomes king

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I met up with the new UK head and the outgoing head at T-Systems today to get a bit of an update.

Sam Kingston leaves T-Systems today and is taking on the role of COO at Ukraine based software services supplier, Ciklum. I will give a bit more detail about Ciklum later but will focus on T-Systems UK for now.

Casper Malig has taken over as UK managing director and it was interesting to hear his ideas. Another former EDS worker you won't be surprised to hear.

I think current trends such as cloud, collaboration and the internet of things all present opportunities to T-Systems. But it seems the company lacks an identity in the UK, despite having some very big customers.

T-Systems UK perhaps suffers because it is a small part of a huge German institution in Deutsche Telekom. It gets drowned a bit by its German counterparts and the UK business is also misrepresented because of its much bigger more extensive continental European operations.

He told me that he wants to let the UK market know exactly what T-Systems is because the perception is sometimes that it is an end to end IT services provider, due to its German business, when in fact it is very specialised in the UK.

He said it is focused on 4 areas, with networking services wrapped around them all. These four are cloud infrastructure; dynamic (on demand in the cloud) SAP; collaboration in the cloud with Office 365; and what it calls the "dynamic workplace" with desktop virtualisation.

"I think we have confused the market. Being part of a big group has put us up against everyone but we are actually very specialist," said Malig. He said in the UK he would describe the company as a specialist in cloud services.

It is a service provider that will help businesses take advantages of cloud technology. Malig said that businesses can plug into all sorts of cloud services but someone has to manage things like security and make sure it integrates to other systems.

The company has about 1000 staff in the UK with customers ranging from the likes of oil giant BP and EE to the Caravan Club. This I find interesting because only a specialist supplier operating in the cloud services arena could really have such a difference in customers. Most large outsourcers wouldn't look at small customers while small broad based services providers could not get into big customers.

If customers are paying for services as they use them per user, then the unit cost to the supplier, with a cloud infrastructure, is the same, therefore a user at a small company is as valuable as a user at a big company.

Another area that T-Systems is equipped for is the increase in the use of internet connected smart devices. In Germany it already has 10,000 connected cars that are internet connected and feed information to users and manufacturers.

It has some interesting tele-health services also. For example it created a pilot of a portal for diabetics to keep in contact with doctors. Rather than constantly visit medics to be checked out, patients can do the tests themselves using a device connected to a smartphone and send data to doctors. The doctors can monitor patients remotely and provide assistance to those that need it.

T-Systems UK is trying to get some of its offerings in the next iteration of the Government's G Cloud.

As for Sam Kingston, another former EDS executive, he will soon move to Kiev believe it or not. He is the new COO at Ciklum. A software services provider that does a wide range of stiff from SAP to Agile. It has a £100,000 turnover and employs 3000 people in nearshore and offshore locations.








Are ICT companies perfectly positioned to become banks?

Karl Flinders | No Comments
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I have been writing quite extensively recently about how traditional banks are in trouble. They are unpopular and their IT estates are out of date. In this article I wrote recently a contact said if services such as PayPal, eBay, Amazon, Facebook and Twitter moved into banking, they would attract customers. Their systems already contain details about people and businesses and handle transactions and money.

Organisations in the telecoms sector are another potential for banking services.

Here is a guest blog on the subject from Pat Carroll, cybercrime expert and CEO of security technology company ValidSoft.

Why telecoms companies are poised to up the banking game

By Pat Carroll

"It's no secret that the telecoms industry has its sights set on the banking sector; it's an attractive proposition given the global shift towards a more digital approach to banking. Just recently, Canadian telco company 'Rogers' filed for a banking license so that it can issue its own credit cards and mobile wallets to its nine million-strong customer base . Rogers is also contemplating offering discounted monthly phone bills in return for use of its mobile wallet feature - nice touch! Similarly, Thai telco 'Tot' is developing a mobile based point-of-sale device. Just two examples of how telecoms companies are leveraging the mobile device to rise to the opportunities in the banking sector.

It's clear that the smartphone is already well on the way to becoming a primary device for payments - indeed 1 in 3 people are expected to do all their banking through a mobile device by 2020. However, success in this market will rely on solutions that are functionally rich, secure and above all, intuitive in terms of the consumer experience.

In the developing world, electronic exchange between mobile devices is already the primary means by which banking can take place. This is clear evidence of how telcos can successfully diversify, and an obvious expansion route for the future. The "last mile" has always the most difficult to conquer, and the operators are already in possession of this crucial delivery channel. Disintermediation will be rife and you can bet your bottom dollar that we haven't heard the last of how the mobile financial sector will eventually shape up.

Whilst functionality will dictate the order of play, trust will be the delineating factor. Expect that the fraudsters will concentrate their efforts on infiltration of this key channel, so maintaining trust against such adversity will be crucial. Reputations in this new, massive channel will be won and lost quickly. Studies show that customers already trust their telco/ mobile operator, but this needs to move up a notch or two as the telco companies seek to establish their credentials in financial services. Industry collaboration stands to help here, especially to tackle fraud, which is one of the main industry issues standing in the way of greater consumer trust.   Industry bodies such as the Telecommunication UK Fraud Forum (TUFF), for example, are proving effective means of intelligence sharing, advising telcos to take a strong approach to security to meet consumer demand for fraud prevention.

Fraudsters target the weakest point in any payments process and they will see the movement of telecoms operators into this space as an opportunity to commit large scale fraud. The recent coverage of SimSwap fraud is just one such an example of how fraudsters have taken advantage of the discrepancy in security between banks and telcos.

Whether its telcos or banks that take control of the digital banking space the key will be to ensure security is up to scratch, and reassure consumers that appropriate measures are in place to prevent fraud across the industry.  By taking a layered approach to security, incorporating a number of different checks based on the risk associated with the transaction,  a solution can be achieved that offers very strong protection yet a totally intuitive and privacy sensitive customer experience. Rather than a cumbersome process of using passwords or tokens, security needs to be based on the smartphone and will likely include voice biometrics, so that customers can use their voice to authenticate and  secure a mobile payment.

If telcos take advantage of the digital banking opportunity in the right way, they are well placed to hold significant market share in the new e-banking world. I look forward to seeing what developments 2014 will bring."


Indian IT firms create more jobs in US than IBM

Karl Flinders | No Comments
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I read this article recently and thought it quite interesting. It is from last July so not really hot-off-the-press, but worth noting.

Indian IT services forms are constantly criticised for taking the jobs of local workers in economies such as the US and UK. I don't doubt these claims, but when you read that Indian IT services firms have created more local jobs in the US over the last seven years than IBM it makes you think.

According to research from JP Morgan IBM created 138,000 jobs in the seven year period but they were all outside the US. In contrast Indian IT services firms created almost 40,000 jobs in the US.

I wrote an article back in 2010  about how IBM was considering reducing its workforce significantly. In fact a senior IBM executive at the time told Computer Weekly's sister publication at the time, Personnel Today, that it could reduce its workforce from 399,000 (in 2010) today to 100,000 in 2017.  The executive said IBM would re-hire the workers as contractors for specific projects and, when necessary, use crowd sourcing. IBM denied this and hasn't really started doing this, but it is the type of thing being discussed.

Combine this with the propensity of IBM and other IT giants to increase their offshore workforce and it might become the norm for Indian companies trying to increase local footprints in the US and UK, to employ more than local suppliers.

Banks get nervy about their Kiev based services

Karl Flinders | No Comments
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The political unrest in in the Ukraine is beginning to worry major UK banks that have work carried out in the Easter European country.

I was chatting to a contact who works in banking IT and he told me that although there have not been any disasters banks are a bit nervous.

He said: "I hear whispers that some banks are getting nervous / suffering from the Kiev disruption. No serious issues or outages yet but I would say it's on the cards. Some firms only have development out there, others have some prod support. I hear some workers are having to rely on remote access and resilience is reduced."

The Financial Conduct Authority said it is the bank is responsible for the outsourced service providers, so if problems arise the banks will need a plan to act on.

Nearshore locations such as Ukraine are often seen as safer options than farshore locations, with close proximity, the abundance of IT skills and perceived political stability seen as a benefit. The attacks in Mumbai in 2008 made people look at their offshoring policies, but it didn't scare them off. The Ukraine will now face similar scrutiny.

IT services firms not focussed on revenue numbers

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IT services providers not focussed on maximising revenue or growing deal sizes. Whatever next? John Keppel president Northern Europe at Information Services Group explains in this guest blog.

Outsourcing profit margins will trump deal size

By John Keppel

"Service providers are no longer focused on maximising revenue from, or growing the size of each deal and the focus is moving towards the improvement of profit margins.

The traditional approach

Traditionally, service providers have delivered services to conform to the client's way of doing things, even if this is inefficient. The "customer is always right" mentality comes into play here and for the provider, it is more important to keep the client happy - the primary goal is to retain or grow the contract rather than simply to streamline processes.

Up to a point, this model works for both sides. Clients inherently will experience some savings, because service providers are good at what they do. Providers, meanwhile, are able to grow revenue by delivering more and more resources to meet the client's increasingly complex and customised needs.

A shift in dynamics

However, this traditional approach is rapidly changing, since standard service delivery models are fundamentally transforming the nature of IT outsourcing relationships. Specifically, clients and providers are beginning to recognise the benefits of using standardised processes for IT service delivery and of taking a collaborative approach. Clients are also acknowledging that their way of doing things isn't necessarily right, and that they can achieve significant savings by implementing "vanilla" processes across business units.

This shift is hugely significant as it disrupts the traditional outsourcing model, with clients no longer dictating terms to a service provider who then customises service delivery on a per-client basis. Instead, clients are becoming more aware of the benefits of process optimisation and why this is more valuable than just reducing short-term costs. Consequently, the onus of delivering savings lies no longer solely with the service provider.

As a result of this, service providers are no longer focused on maximising revenue or growing the size of each deal (by adding more people to run inefficient operations). Today, the priority is shifting to improving profit margins. While it may seem counter-intuitive, providers are embracing the concept of standard services, as it gives them greater control to leverage economies of scale across multiple clients and to demonstrate their expertise in delivering services efficiently.

Pace of change


When we started talking about this trend a few years ago, sceptics argued that this was the stuff of ivory tower theory, and that providers would never accept shrinking revenue. Today, in the real world, we're increasingly seeing providers move toward this higher margin/lower revenue model. Some recognise the inherent benefits and are leading the charge, while others are grudgingly responding to competitive pressure.
This year, we expect the pace of change to accelerate as social, mobile, analytics and cloud (SMAC) technologies enter the mainstream, and as operational transformation increasingly becomes the rule rather than the exception.

Technology and outsourcing

Automation is also playing a key role in revolutionising the traditional model.   While traditional outsourcing derived cost efficiencies through labour arbitrage and moving jobs to low-cost labour centres, today's emerging model employs labour automation largely to remove wages from the equation altogether.

We are already witnessing the integration of discrete automated solutions in a wide range of functions, such as help desk and infrastructure support, as well as in a variety of sectors. For example, consider how x-rays are reviewed. Currently, U.S.-based radiologists ship digital x-ray images offshore to be read by Indian doctors who conduct a preliminary evaluation and send the results back. This division of labour produces savings in two ways - first, by allowing the initial evaluation to be conducted by a lower-cost resource, and second, by making the U.S.-based radiologist more productive. Today, automated software tools are increasingly being deployed to evaluate x-rays and automatically generate reports, thereby bypassing the step of the initial human review. The result: higher productivity (the automated tools read x-rays much faster than the Indian doctor) at lower cost (after the initial investment, the tools don't have to be paid).

Needless to say, these developments further undermine the traditional deal size and revenue maximisation model. 2014 promises to be an interesting year indeed."

The dangers of long term IT outsourcing contracts - the BBC way

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The BBC is now planning its future after a ten year deal, originally with Siemens Business Services (SBS), comes to an end next year.

Back in 2004 the BBC signed a massive IT outsourcing deal with SBS which included the IT services firm, now part of Atos, acquiring the BBC's IT infrastructure and taking on 1400 of its IT staff.

The BBC is now moving to lots off contract covering different parts of IT. Ads a BBC spokesperson told Computer Weekly: "We are moving from one monolithic contract covering everything to multiple contracts with a number of specialist companies. This allows us to get better value, greater flexibility and access to new technology as it emerges."

This has been a trend for quite some time in the private sector as companies such as BP run highly efficient multi-sourced IT services ecosystems.

The BBC had a bad experience in this contract. Over the years I spoke to several people that told me the BBC was desperate to get out of that contract but simply couldn't.

Perhaps the BBC was being innovative back in 2004 by having a huge deal with a single supplier and offloading its IT infrastructure and IT staff. But time change and that was a commitment too far.



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