Learn to see through the clouds with European CIOs
I had the chance to attend the EuroCIO's annual conference in the last week of November.
More than 120 Chief Information Officers and other senior IT Executives gathered to share experiences and work jointly on issues they face in their jobs. I must admit that, at first, some of the topics discussed came as a surprise to me.
There are really three topics I retain from this couple of busy days:
1. Cloud computing and virtualization are not a fad
2. IT talent shortage is upon us in Europe
3. The financial crisis has positive effects on IT
Let's explore these topics if further details...
Cloud computing and virtualization are not a fad
They represent a durable trend that both large and smaller companies have started to use or are planning to invest into.
Virtualization and sharing of IT resources is happening at several levels in parallel: In the data center with shared computers and storage; at the applications level with "Software As A Service" (SAAS) or "Pay as you go" approaches; and also on the desktop to reduce its Total Cost of Ownership.
The aim is nothing new:
- Lower costs: optimize investments usage through mutualization and just in time purchases
- Improve reliability and availability: lesser distributed environments to manage, greater redundancy opportunities, tools to dynamically reconfigure the IT infrastructure
- Respond faster to new and changing business needs: ability to increase rapidly the IT resources supporting an application. Especially useful to respond to a marketing campaign that would generate higher response than forecasted, a successful new product launch, peak demand periods...
- Reduce the impact on the planet: "Green IT". Thanks to better use of existing investments and sharing of machines to serve multiple applications
- Increase flexibility and move from static costs to variable ones based on usage: new models emerge that extend SAAS models towards "pay as you go" to provide greater flexibility and more variable costs of IT
- Address security concerns with Virtual Private Clouds: It is possible to have your own private cloud to secure the access to all or part of the IT.
It is interesting to note that the very first steps towards virtualization, i.e. servers' consolidation and virtualization, lead on their own to very significant Capital Expenditure reductions (up to 50% according to industry benchmarks and it is the Top #1 strategic technology for Gartner).
New models that are emerging, such as Amazon's EC² for Elastic Computer Cloud, respond to this need to serve faster fluctuating business demands. They also lay the foundations for a virtuous circle as development teams start to understand that they can release excess capacity and get it back quickly if needed. A quick review of systems utilization usually shows that there is a significant portion of the assets is vastly under-utilized.
IT talent shortage is upon us in Europe
I must admit that I was a bit puzzled at first by this statement. It is not exactly what I live with in my daily job. Constant cost pressure and acquisition of new talents at offshore locations have taken most of our attention. But, these CIOs attending EuroCIO are very experienced and certainly worth listening to.
As you could expect from CIOs, they do not only list issues, they are already in action mode to address root causes.
Their review of the key competencies were shortage is foreseeable in the near future if not already here identified senior architects, project managers, and experienced IT strategy and innovation staff as the most critical skills missing.
What strategies did they propose to improve this situation?
- Further develop internal education programmes for IT staff in their own companies. With a specific focus on top talents' development. Expose them to more aspects of IT and business.
- Bring more business people into IT to diversify the pool of resources and encourage job rotations between IT and Business
- Better recognition and promotion of IT certifications such as PMI, ITIL, CMMI...
- Manage the overall lifecycle of career development for IT professionals
Another aspect discussed was the need for better senior IT executives' education. Here again, a few ideas:
- Get involved with universities in cursus elaboration as current ones are seen as poor in IT management classes.
- Most of the cursus focusing on technical skills versus inter-personal and business ones.
- Contribute personally, i.e. teach in universities and business chools, join schools' boards to influence contents of curriculum...
Additionally, there is an identified need to better position ourselves to attract more ladies into technical jobs and in general more of the new generations to IT. The so called "Digital Native" (who is below 25 years old) was born with a mobile Personal Digital Assistant/Phone in one hand and a remote control in the other. Hence, his approach to IT is very different from his elder colleagues. Also, there is a wide gap between the "Digital Native" aspirations from work and life and those of the senior IT managers in place. The latter are most often "Digital Immigrants" (45+) and their attitude regarding work/life balance is usually that work is an absolute top priority.
The Financial crisis has positive effects on IT.
First of all, it opens and even forces a dialog between IT and business on difficult and sensible topics:
- Renegotiate Service Levels to something less costly for the company while still responding to the really critical needs of the business
- Encourage the shutdown of old or almost "unused" systems via applications portfolio review and pruning
- Establish much tougher criteria for new projects' selection and launch. Pay Back Periods below 12 months were mentioned by several participants as mandatory for any new IT initiative in their companies.
- Strengthen internal processes with a focus on IT performance and quality of service. Redirect some of the critical resources freed up due to many projects being deferred by several months or cancelled towards critical processes improvements.
- Consider other ways of doing things to gain in cost effectiveness: Reuse, reprioritize, question the status quo and current practices, remove red tape, simplify workflows...
- Better manage suppliers
- Ensure that technical IT migrations embark significant business benefits and improvements or question their necessity
Further more, this period is a good opportunity for CIOs to "educate" their boards on the risks of cutting IT too much when the business has become so dependant on IT that it can come to a halt if the right IT resources are not protected.
They can also engage discussions on how to simplify IT management. We very often have a multi dimensional matrix management of IT across Business Units, Geographies and IT Functions. This matrix is useful to have the required proximity between IT and the business but it may have become overly complex. Over time, layers have been created that can and should be questioned if they widen the gap instead of reducing it. Also, they may hamper necessary standardization of some IT services that can be considered as commodities or even utilities (basic infrastructure, PCs, software build on the PC...) and others.
unfortunately, I cannot yet read through the clouds, but the conference provided me with a greater insight
So, as you can read in this article, the conference was definitely worth the investment in time and energy. Of course, the greatest and most beneficial part is the discussion time and networking that such opportunities enable between people sharing similar concerns, issues and who are willing to work together to resolve these. It opens up to new ideas, new ways of doing and presenting things. As Nancy MacKay, one of our guest speaker, rightfully concluded her presentation:
"If you knew you couldn't fail, what would you do?"
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December 8, 2009Joanne Henderson, PMP, Six sigma Black BeltMichael,
You did an excellent job of highlighting the conference and the problems experienced today by CIOs in Europe. This should not be too different here in the US.
I do agree our current organization is complex and it is hard for us outsiders to understand the many projects and governance model used for IT improvements. When I was at AT&T and when I got my masters degree in organization management, I learned how important it is to look at the process and to remove layers of management when it slows the process. For example, at AT&T we removed the need for approval for certain purchases. It saved a lot of time.
Also the SEI CMM methodology is a very good way to improve efficiencies in Software Development. At BellSouth, we started using this to reduce time for software updates. Once the code is documented and reviewed properly, the updates and manuals are much quicker to do.
I love the new on-line applications now found on the web...
Keep up the good work.
Joanne Henderson, PMP
six sigma black belt