deal architect

Clouds: Some steps forward, a few back…

John Chambers worries about cloud security and Werner Vogels lays out the broadband challenge with loading very large data sets

Both John and Werner have vested interest in making cloud computing successful so I would rather hear from them than in FUD from on-premise vendors.

And on the flip side, Bob Warfield talks about 10 things you will not have to worry about in cloud computing.

“The innovation tilt toward big companies”

Steve Lohr at the NYT loves to get me going:) Last time it was about McKinsey and cloud computing.

This time his premise is larger companies “employ scientists in many disciplines (and) typically have the skills and scale to tackle (complex) projects” – ergo they have rediscovered innovation.  He also quotes Mr. Disruptive  - Clayton Christensen, author of the Innovator’s Dilemma - and other big biz school professors.

I don’t claim to know much about big companies in other verticals, but Steve uses tech vendors, IBM and Microsoft as examples in his article. The problem is Stave uses isolated parts of those vendors which are innovating to describe the whole.

The reality is the majority of IBM’s software and outsourcing revenue (i.e the majority of its revenues) comes from ancient products like Lotus and Tivoli; much of their services revenues is delivered from cold-war era bunkers called data centers and around old-in-the tooth ERP like services and BPO of tactical services like accounts payable and payroll processing . Microsoft is somewhat better on the consumer side but the majority of their enterprise revenue comes from Office and SQL Server and Dynamics – legacy products. 

We need divine help if all that is defined as “innovation”

Clayton’s quote to him has a big qualifier “once (big companies) recognize the benefits of disruptive thinking”…

See how Microsoft and SAP are responding to SaaS. See how Oracle is dealing with third party maintenance. See how IBM and HP/EDS and EMC are responding to clouds. See how Verizon and AT&T are dealing with VoIP.

Hmm, you really think these big tech companies have discovered  “the benefits of disruptive thinking”?

“Do so gently”

Couple of the most poignant scenes to me in Angels and Demons come in the beginning and end of the movie.

Early on a Vatican rep tells Robert Langdon he is unpopular with the Church but considered “formidable”

Towards the end, a Cardinal tells him “When you write about us, and you will, do so gently.”

The mighty Church and the mysterious professor. The elephant and the mouse.

You know it reflects the relationship large vendors have with some bloggers. 

One of mutual respect? Or one out of the Corleone  book “Keep your friends close, but your enemies even closer”?

More New Renaissance

On the innovation blog

Travel Technology Trends

“Golden Kitchen”

Medical Design Excellence Award

Food Chain Innovations

New toys for astronomers

Social (Pressure) Networks

I have felt for a while Social Networks were missing a word – hence Gartner had not coined a TLA for them.

Proof of that comes this morning as good friend Susan Scrupski set my blog feed up on Twitter. Here it is on Twitter Search. Susan, thanks, I guess?

So Chris Selland asks her if she is ghost-tweeting for “the celebrity”.

Before people get even wilder ideas, let me say I ain’t going to rap like Shaq who is one followed celebrity Twitter. No matter how Kobe does in the NBA playoffs this week.

Do expect some soliloquy from me. Here’s some – of course, parsed to fit the darned 140 character format

Hamlet 2.0: To Twitter or not...

SAP’s generosity

See also update at bottom

Jeff Word at SAP has very kindly offered complimentary copies of  his new book Business Network Transformation (due out August, list of $ 40) to Deal Architect clients and to contributors to the Technology and my Hobby/Passion series on the New Florence blog.  He has compiled the book with some of the best minds in the industry.

Even more generous, SAP  is donating royalties from the book to the World Food Programme

So, send me a column on your hobby/interest, become a client or buy the book – all good causes :)

Synopsis of the Book

“Rather than implementing rigid "built-to-last" processes, organizations are now constructing more fluid "built-to-adapt" networks in which each member focuses on its differentiation and relies increasingly on its partners, suppliers, and customers to provide the rest…..this book offers cutting edge research and an in-depth exploration of critical topics such as customer value, supply networks, product leadership, global processes, operations, innovation, relationship management, and IT.

Contributors include Geoffrey Moore, Philip Lay, Marco Iansiti, Mohan Sawhney, Ranjay Gulati, David Kletter, Venkat Venkatraman, John Hagel III, John Seely Brown, Gautam Kasthurirangan, Randall Russell, Henry Chesbrough, Jeffrey Dyer, and Andrew McAfee.”

Amazon link

http://www.amazon.com/Business-Network-Transformation-Reconfigure-Relationships/dp/0470528346/

Correction from Jeff Word: SAP isn't involved (contractually or financially) with the book at all, they just sponsored all the researchers and gave them high-level access to our customers for interviews on the BNT topic.  Its a real-deal, bonafide thought leadership book by the 2nd largest publisher on the planet.  Myself and the other contributors are donating all of our royalties to the WFP and the publisher (Wiley) kicked in an extra 3% of royalties to us so we could donate a larger percentage of the total revenues to the WFP. 

Out of Africa

China in Africa

“In just a few years, the People's Republic of China (PRC) has become the most aggressive investor-nation in Africa. This commercial invasion is without question the most important development in the sub-Sahara since the end of the Cold War -- an epic, almost primal propulsion that is redrawing the global economic map. One former U.S. assistant secretary of state has called it a "tsunami." Some are even calling the region "ChinAfrica."

The US in Africa

“Globally, competition for American (investment) is high. Countries from all regions showcase their advantages, align their offers to U.S. needs, clamor for attention, and invest in their own countries to attract additional investment. Consequently, U.S. corporations do not lack investment choices, and they rarely consider African nations.

Further, news about Africa is mostly about chaos and unrest. Africa is not active or aggressive enough about attracting investment; the voices of the few countries that are making an effort get lost in the surrounding negative noise.”

Speedy or Sensible Sourcing?

Stephanie Overby at CIO Magazine writes about “speedy sourcing” - a new approach for choosing a service provider and sealing a deal in three months or less.

New?

I helped a client in 2002 which desperately needed to get an application outsourcing deal done in 2 months. We looked at several US, European and Indian firms, visited several for due diligence, and got best and final offers from the short listed vendors. In 2 intense months. Opened my eyes to speedy sourcing.

But 7 years later and many transactions later I have adapted my firm’s approach. Speed still matters – but speed can also just take clients down old cow paths.

Frankly, a few more wrinkles (without making the process much longer in elapsed time) add a lot more value to a client

• I recommend a “paperless’ sourcing process. Emphasize more of human touch – interviews of key staff, many more reference calls, more vendor oral presentations (customized to client scenarios, not canned ones – and ideally delivered by the outsourcer delivery not the marketing/sales team), due diligence visits (where I have the vendors simulate “a day in the life of the client’s support”), more face to face negotiation sessions and legal reviews. Cut out the written RFP. Or have a very short one. All these steps can be done quickly – with appropriate planning and logistics coordination.
• Showcase all kinds of choices to the client. If offshore, have them also look at alternatives to India – E. Europe, Philippines, rural etc. If looking at infrastructure outsourcing, look at utility and cloud providers. If application outsourcing look at SaaS and BPO options. Outsourcing is a “life event” – for 3,5, 7 years – shame on the client if their sourcing is not willing to look at coming market disruptions in that planning horizon. Shame on the sourcing adviser if it cannot quickly organize disparate vendors to participate in that discovery process. (BTW - most sourcing advisers are siloed and only know vendors in specific categories and frankly suffer from “Stockholm Syndrome”. Their narrow focus hurts many clients)
• Have the client look at life post-sourcing. What happens if the companies grows through acquisitions? What happens is the bottom falls out? Will your outsourcer truly turn your fixed costs to variable? Exit/Change control strategies. Governance. I find too many clients let their procurement folks and attorneys worry about this items during negotiations when it should be part of the learning/sourcing process.

Speed is important. Sensible even more so.

Juicy as a compressed orange

Not the Cockney expression which inspired the Stanley Kubrick movie. But the buzz over the last 3 weeks about storage and compression amongst the flies on the walls at the Orange County Convention Center.

At Collaborate two weeks ago - what Oracle will likely do with Sun, and what it means to storage. At Sapphire last week - what Dr. Plattner’s vision of super-compressed data means to storage. This week at EMC World - what its emphasis on virtualization and foray into cloud computing mean to storage. 

It is good to see one of the biggest and fastest growing components of IT spend get more and more attention – see my note Should the storage tail wag the application dog?

The time is right to develop aversion therapies towards our addiction to expensive storage – to borrow a non-Cockney expression from Kubrick’s movie.

Software “Spin Ins”

Bruce Cleveland, ex Siebel and now a VC, knows enterprise software as well as anyone. He writes at Sandhill.com about themes I harp about all the time – lock-in of the MISO vendors , lack of funding for enterprise software startups, innovation stagnation. In fact he has a bleak title “The Death of Enterprise Software?”

He then proposes a “spin in”

“a company formed with the explicit endorsement and investment - including personnel, cash and IP - by a large software company and venture investors. The express purpose of the spin-in is to build strategic products and/or go after new markets with the ultimate objective that the large software company will acquire the spin in at some point in the future.”

Having just come from Sapphire and seeing SAP’s struggles with BusinessByDesign, you wonder what if SAP had funded it as a separate company?

But then I rethink. With the spin in model, the very forces that are killing the software industry would continue to rule it. Not a personal statement, that of customers.

I have heard from at least a few potential buyers they will not consider salesforce.com or NetSuite even as they look at SaaS because they think they are closet “spin in” candidates for Oracle (Larry Ellison has investments in both). You can argue till you are blue that is an irrational fear – but the emotion is out there and a statement on the angst a growing number of buyers are feeling against MISO. 

Not a day goes by where I do not hear about shenanigans one of the MISO executives or salespeople has pulled off somewhere and royally pissed off a customer or set of customers.  This week Microsoft had the gall to tell some of its customers to say “stop Vista deployment” after haranguing them last couple of years to get there. And it is still including in proposals to some customers they implement it. See the open letter Bob Evans at Information just sent Leo at SAP.  Dennis Howlett reported yesterday on Oracle’s games with virtualized deployments. It’s to the point where I don’t even flinch when I hear such reports.

I think the only way the enterprise software industry blossoms again is the role of MISO continues to diminish. It’s already happening. SaaS, Third Party Maintenance, Open Source, BPO, Vertically specialized software, Custom development are all chiseling away at the MISO base.

What we need is for tech buyers and investors like Bruce to keep encouraging these disruptive and innovative players.

Life is about balance. MISO has a role to play. It just needs to be a 25% of enterprise budget role. Then may be we can talk about their “spin ins”