Opinion

To be open or not to be – that is the question

The old Chinese curse of “may you live in interesting times” would seem to be an apt description of IT today.

The normal hullabaloo of consumerisation, social media, big data and cloud computing are all driven by an underlying cycle of change, but individually these subjects barely scratch the surface of what is going on.

From new organisational practices, to a shift from relative competition, to a fight for survival, swathes of companies are facing fairly seismic upheavals in their industry. Many are staring at the abyss of disruption with their own internal inertia ushering them ever closer. They often know what they need to do, but their own past success hangs like a ball and chain dragging them over the edge and preventing them from adapting to the new world.

Declarations of war

Today, the dramatic words of company CEOs are only surpassed by the headlines, for example: - “HP chief Meg Whitman declares war”; “Microsoft’s Steve Ballmer declares war on Apple”; “Yahoo turns to former nemesis to be its CEO saviour”; “Microsoft posts first ever loss”; “Nokia’s US sales disaster”; “How long can RIM stay alive?” and so on.

In between this, some dramatic actions are afoot, unlikely changes and even more unlikely allies – “Google Compute Engine challenges Amazon”; “Microsoft plays well with open source”; “Canonical partners with Microsoft”; “Citrix donates $200m Cloud.Com to Apache Software Foundation”.

This is a fight for survival and not for the faint-hearted.

The list goes on and on. But what is going on?

First, many IT activities are going through a stage of evolution from products to more commodity and utility services. The natural consequences of this are the development of new higher order systems - and a shift of capital; rapid growth in unmodelled data combined with arguments over classification of data; new forms of practice leading to new forms of organisation; and finally, disruption of past industries stuck behind inertia barriers.

It’s no surprise that cloud computing, big data (including debates over NoSQL vs SQL), the creation of companies like Instagram, novel practices such as “design for failure” and movements such as DevOps have all occurred in short order. This is all part of the same cycle. The same things happened in the age of electricity and every other economic age we’ve been through. Along with this, we get the normal concerns of disruption and mass unemployment through automation – see Nehemiah Hawkins and the age of electricity or any of the modern-day equals.

Take our survey

Open technologies are increasingly being used as a competitive weapon, so to explore this theme Simon Wardley has created a short 10-minute survey which will provide further illumination on the subject, but will also be a useful exercise for the reader in thinking about how open can be used. Readers are invited to complete the survey at bit.ly/opensurvey and we’ll publish some of the findings in due course.

War and peace

The affected industries are also shifting from an era of peace - one of relative competition where sustaining change exceeded disruptive change - to one of war, where competition is a fight for survival and disruptive change exceeds sustaining. In this maelstrom of change, the company CEO needs to direct a company to adapt - often against its wishes - and forge new alliances.

It’s no surprise that CEOs are more openly talking of war and creating alliances with companies that were at one time seen as deadly foes. This is a fight for survival and not for the faint-hearted. It’s no surprise that once great names also seem to flounder - that’s what disruptive change leads to.

Strategy is critical in this war era and it requires an understanding of timing, the landscape, and action. While IT strategy in the past has often referred to operational choices such as what technology or vendor to use, today’s game is all about undermining a competitor’s barrier to entry, protecting against threats, creation of ecosystems and altering market dynamics.

It’s hence no surprise that companies are making big bets with open technology as they can (and are) used to enable such plays. This happens directly with open source such as Citrix with Cloud.com or VMware with CloudFoundry or the US Veterans Affairs department with OSEHRA (open source electronic health record agent) which all aim to create a standard for a market and change the dynamics of this space. We also see this via the creation of ecosystems based upon APIs (application programming interfaces) with companies such as Amazon and Google exploiting these more “open” ecosystems to protect existing value chains or create new ones. These plays will become the norm.

Aggressive commoditisation

Fortunately most of us feel fairly safe because this war is confined to purely the IT industry. Except of course this is just an illusion. From healthcare to insurance to banking to government, these industries are all being dragged into the war.

This of course won’t stop here. With the growth of open hardware, 3D printing and printed electronics, then the next age, which is related to the commoditisation of the means of manufacturing, is already creeping up on us. The difference between software, retail, media, banking, insurance, healthcare, hardware and manufacturing is only a matter of time.

All of these industries will face new competitors who aggressively use commoditisation, development of ecosystems and open technologies - whether open source, open data, APIs or open hardware - to compete against others.

All of these industries contain players who believe it won’t happen to them, that theirs is a unique relationship business, that their offerings are too complex to be provided as a commodity, that barriers to entry are sufficiently high to thwart any new entrant, and that somehow the past will be the future. If history is a useful yardstick then many are heading for a rude awakening.

Preparation for the war is essential; from mapping out value chain versus evolution to identify what areas will be under attack, to learning how to exploit open technologies and ecosystems to our advantage.

It looks like we're heading to a world where being open, or at least exploiting open, isn't optional, and for many it will become a question of “to be open or not to be”.

Simon Wardley is a researcher for CSC’s Leading Edge Forum, a global research and advisory service for CIOs and their teams. Simon’s latest research project is entitled Competing in an open world.

Open technologies are increasingly being used as a competitive weapon, so to explore this theme Simon has created a short 10-minute survey which will provide further illumination on the subject, but will also be a useful exercise for the reader in thinking about how open can be used. Readers are invited to complete the survey at bit.ly/opensurvey and we’ll publish some of the findings in due course.

Email Alerts

Register now to receive ComputerWeekly.com IT-related news, guides and more, delivered to your inbox.
By submitting you agree to receive email from TechTarget and its partners. If you reside outside of the United States, you consent to having your personal data transferred to and processed in the United States. Privacy

This was first published in July 2012

 

COMMENTS powered by Disqus  //  Commenting policy