Tag Archives: cost of ownership

Cloud And Big Data Drive BPO Benefits

1 Reply

Cloud computing and business analytics are set to inject new life into the business process outsourcing (BPO) sector through reduced upfront costs and better use of the data.

IT-enabled BPO is big business, but IT’s role is largely as an enabler of efficiencies. The IT infrastructures that support BPO can be fine-tuned to cut costs, but the best-performing BPO deals are using IT to innovate.

Recent research from Accenture revealed that only 20% of BPO projects “are delivering sufficient business value to be classified as high performance”. The findings from the research, which was completed in conjunction with the Everest Group and the London School of Economics, also revealed the changing role of technology in BPO.

The survey questioned 263 buyers of a range of BPO services such as finance and accounting, procurement, human resources, and supply chain.

The report also validates eight best-in-class practices that are strongly correlated with high-performing engagements. These include using technology as a tool for innovation rather than just the infrastructure.

Anoop Sagoo, products industry BPO lead at Accenture, said cloud computing and data analytics are two technology areas that are currently offering businesses the opportunity to get more out of BPO.

He said software-as-a-service (SaaS) means businesses can introduce the applications used in BPO agreements without the need for large upfront payments: “Best-of-breed technology is now readily available and easy to apply.”

Sagoo added that the early parts of BPO agreements are usually loaded with costs associated with technology.

In the past, a business would have to buy licenses and install heavy-duty business applications as part of a BPO deal, but today they can sign up to cloud-based services and easily scale up and down the number of users. “It allows you to set up and run technology with a different total cost of ownership [TCO] model.”

Technology is also providing increased value from BPO relationships. The use of the latest business analytics software enables businesses to get more from the data being handled within BPO relationships. “Analytics is the big focus on technology in BPO at the moment,” said Sagoo.

Mark Lewis, head of outsourcing at law firm Berwin Leighton Paisner, said if the cloud is to offer massive BPO savings through platform-as-a-service (PaaS), BPO suppliers need to invest in cloud platforms.

“Otherwise it is the public cloud route you have to go down. If you use a private cloud, with visualization behind your firewall, you still need to buy licenses,” he said. “It would be interesting to see how many Fortune 500 companies are willing to move all or some of their processes to the public cloud.”

The Accenture research also revealed:

  • 85% of high-performing BPO engagements consider the service provider to be a strategic partner, compared with 41% of typical engagements;
  • 75% of high-performance BPO engagements involve senior leaders from both parties spending time to understand each other’s objectives and strategies, compared with 33% of typical engagements;
  • 90% of the high performers reported that the client and provider were able to productively resolve conflicts – this was true only with 44% of typical performers;
  • 77% of high-performing BPO engagements have successfully executed change management plans, compared with just 34% of typical engagements;
  • 85% of high-performing engagements proactively refine their objectives as the relationship matures, compared with just 40% of typical engagements;
  • 67% of high-performing engagements include business benefits beyond cost in the business case, compared with 26% of typical engagements;
  • 58% of high performers will consider service options with greater value, even at higher costs, compared with 31% of typical performers;
  • 56% of high performers seek competitive advantage through BPO, while only 28% of typical performers aim for that goal;
  • 64% of high-performing engagements place more focus on capturing other benefits as they achieve cost reduction, compared with 40% of typical engagements;
  • 54% have contract performance incentives in place, compared with only 24% of typical performers.

Author: Karl Flinders
Source

BYOD Tools

Leave a reply

In a bid to make virtualisation and cloud computing more palatable to enterprises which have a high concentration of mobile users, or are implementing a Bring your Own Device (BYOD) strategy, VMware has launched a fistful of new products and a public beta of a system that offers what it describes as “Dropbox for the enterprise”.

The products available today and later this year bring to life the product roadmap that VMware outlined at its major user conference last year. According to Tim Hartmann, senior manager of systems engineers for VMware in Australia; “If you look at all the releases they dovetail into BYOD in a big fashion.”

At the heart of that is the release of VMware View 5.1 which offers IT managers a caching methodology to take the load off the underlying storage systems that are accessed by end user devices. By removing the bottleneck Mr Hartmann said it was possible to have a higher density of systems attached, which led to a lower cost per desktop.

The company claims that the total cost of ownership associated with a virtual desktop infrastructure could be cut by up to 50 percent thanks to optimising storage loads. The tool also provides a single management console from which IT managers can control provisioning, con?guration management, connection brokering, policy enforcement, performance monitoring, and application assignment.

VMware has also launched Horizon Application Manager. Since buying TriCipher in 20120, VMware has been offering that tool in the US. Horizon however has been recast for the global market.

“This is a way of creating a single sign-on … for whatever cloud based applications you are using,” said Mr Hartmann.

The system uses Active Directory to handle the authentication for each user. Instead of needing user IDs for each cloud service a user subscribed to, Horizon now manages that access.

“From an administrator’s perspective you can say yes you are allowed to use this service – but also if someone leaves then you can turn that of with the flick of a switch,” said Mr Hartmann.

VMware has also launched its vCentre Operations for View tool which provides IT managers with a traffic light style dashboard to illustrate the end user experience and identify problems.

While this form of insight has been available for virtual machines in the data centre for a while, this extension of the tool allows IT managers to monitor how their end users’ devices – whether desktop, mobile, virtual or BYOD – are performing, and where necessary tweak the system to improve that performance.

Finally the company has launched a public beta of its Project Octopus programme, which Mr Hartmann described as “Dropbox for the enterprise.” Originally three local companies signed up for the private beta pilot of the programme, but Mr Hartmann says that there are now 20 companies trialling the system, which has been made available as a public beta from today.

It will be launched officially later this year.

“It presents you with a folder and that becomes your document repository, which can be made available to other nominated users,” instead of emailing large files around an enterprise, he added.

Author: Beverley Head
Source

Reasons To Include The Cloud In Your Business Strategy

1 Reply

The issue of success or failure in moving your company data, IT storage, servers or software to the cloud is often driven by technical issues, including performance, bandwidth, security and total-cost-of-ownership (TCO) considerations. While many of these factors are key criteria for selecting cloud solutions, they usually don’t align with the bigger picture that C-level executives must consider when adding new IT solutions.

How IT can help sustain or create a competitive advantage has never been more apparent than today through the use of cloud computing. This technology boasts benefits such as reduced costs and scalability, just to name a few, but many companies fail to find the right fit for cloud within their business. [Disclosure: The Open Group is a sponsor of BriefingsDirect podcasts.]

This is because cloud computing is not ‘one size fits all’. Performance, network bandwidth, security, and total cost concerns can be allayed through a better portfolio and investment approach that considers the multitude of options available.

How cloud computing fits

In industries where working capital bears a high price and is in short supply, businesses often have to make ends meet and have limited investment available. Therefore, being able to source the lowest cost and drive efficiencies even further is critical to growing business and market share.

For companies with limited working capital resource or cash flow funds, the use of on-demand services becomes an attractive option for consumers to avoid upfront costs or maintenance of services. Likewise, companies seeking to provide better profitability from their operation and vendors managing their cost center can leverage on-demand models to target areas of their portfolio to reduce cost and maximize return.

When adopting cloud computing, companies are often driven by cost effectiveness, rather than looking at the bigger picture and asking what cloud solution is the best fit for the business. Cost savings, longevity of product, and performance aren’t mutually exclusive, and all should be factored into the decision-making process when researching and purchasing a cloud solution.

Here are four questions, which include key metrics and drivers, to ask when researching cloud solutions that will maximize the value of cloud computing for your organization:

Why is investment being spent on areas of IT that are not differentiating your business and can be commoditized?
Key Metric: The balance of percent of investment on non-core commodity IT
Key drivers: TCO needs to consider where to focus IT investment

How can IT grow and adapt with the ever-increasing expansion of data storage and the growth of computing demands eclipsing on-premise facilities?
Key Metric: The cost of storage and archiving , recovery and continuity
Key drivers: Latency of network and storage costs can be targeted through considering the whole IT portfolio, not just niche use cases of cost-performance. Look at the bigger picture.

How can access to new markets and new channels be better served through extending networks and partnerships?
Key Metric: Size of markets and effectiveness of sales channels, both internal sales and external direct sales and reselling
Key drivers: Total cost of acquisition can include the creation or use of third-party distributed marketplaces and self-service portals and platforms

Is your own IT fast enough to beat your competition or drive the cost savings or revenue and margin growth plans you need?
Key metric: Speed of IT delivery and its cost and quality of service.
Key drivers: Performance can be offered through selected service provisioning. Question whether all knowledge needs to be in-house. Skills can be as-a-service too.

Author: Dana Gardner
Source

Reshaping Supply Chain Management

Leave a reply

Over the past 24 months, the interest in cloud computing – a general term for software deployed through hosted, managed services and software-as-a-service (SaaS) models – has continued to grow. As a result, the movement of more business applications into the cloud is becoming more prevalent. This popularity is made clear when you consider the recent report from ARC Advisory Group, which revealed the supply chain management market grew 7 per cent in the last five years, while the SaaS market, grew at a compound annual growth rate in excess of 20 per cent during those same five years. Add to this Gartner’s predication that, by 2012, 20 per cent of businesses will own no IT assets, and it’s plain to see how core the cloud now is to the future of IT.

With the need for more reliable forecasts and rapid implementations, manufacturers are seeking solutions that leverage the benefits of supply chain planning applications without the traditional investment of implementing on-site technology, providing faster time-to-value and lower cost of ownership. This is where cloud computing can provide manufacturers with new ways to benefit from a fast return on their supply chain management investment while avoiding hefty upfront hardware and infrastructure costs. As a result, manufacturers can improve forecast accuracy and provide more reliable demand visibility, which leads to enhanced customer delivery performance, improved cash flow and reduced inventory across the supply chain.

For a manufacturer’s supply chain itself, there are several advantages that cloud computing can bring. First, the metrics are quantifiable. In today’s dynamic business environment, the ability to deploy sophisticated planning solutions in just a few weeks and with minimal staffing requirements creates an exciting new opportunity for manufacturers to rapidly optimise operations, respond to new market challenges and reduce costs. This capability enables businesses to quickly start generating reliable forecasts and optimised master production plans based on a global view of customer demand. By bridging the gap between front- and back-end planning, organisations can more efficiently satisfy customer demand, while improving overall profitability through better inventory investments. Improved sales, reduced cost of goods sold, increased asset throughput and a decrease in inventory are just a few of the potential top-line and bottom-line benefits of cloud-based solutions.

Secondly, overall supply chain performance is improved. Cloud-based supply chain solutions offer robust supply chain and master planning capabilities. This can be achieved no matter how complex the supply chain, even if it includes factories, distribution networks and suppliers. An intelligent supply planning optimisation workflow produces a global master plan that delivers comprehensive analysis and visibility, as well as proactively identifies exceptions and supply chain constraints. Popular cloud-based features include:

  • Inventory, factory operations, distribution, capacity and supplier shipment plans
  • Pegging and allocation capabilities
  • Multi-dimensional demand prioritization
  • Forecast netting, spreading and expiration
  • Forecasting based on revenue, units, margin and other financial and corporate measures
  • New product forecasting and workflows
  • Demand consensus workflows
  • Exception-based alerts
  • What-if analysis and side-by-side plan comparison

These benefits can be realised in eight to 10 weeks – far shorter than average ROI on most IT implementations. The quick deployment of a cloud-based solution is due to its hosted delivery model, template-based dashboards and workflows, robust reporting and analytics capabilities. Hardware does not have to be procured or installed inside the company. Instead, businesses can leverage the infrastructure already in place through their managed services organisation. Within eight to 10 weeks, the business will see supply chain improvements based on reports that analyse items, such as the annual operating plan and outlook, the forecast waterfall, on-hand and projected end-of-quarter inventory and delivery performance, among others.

In today’s climate, budgets are tight and manufacturers are always looking for ways to make themselves more efficient. The time and money saved by using cloud-based solutions could make the difference as manufacturer’s look to come out of the economic gloom.

Author: Kelly Thomas
Source

Avoid Desktop Virtualization ROI Traps

Leave a reply

If potential cost savings are driving your desktop virtualization decision, beware the ROI killer: Over-provisioning.

Over-provisioning is a nice way of saying you’re throwing money away. That could happen in a variety of forms, such as buying infrastructure that it better suited for a much larger company, planning for growth that doesn’t happen, or not doing your homework on what other technology you’ll need to support virtualization. But fear of wasteful spending shouldn’t stop you in your virtual tracks; rather, it should motivate informed, careful decisions.

Raj Dhingra, CEO of NComputing, believes 2011 is a turning point in desktop virtualization deployments among small and midsize businesses. Dhingra, who left Citrix to take the NComputing helm in April, also said the broader field of virtualization vendors has taken note: “Everybody sees there is a big opportunity there.”

As the number of viable virtual desktop infrastructure (VDI) options for SMBs increase, Dhingra recommends paying close attention to four key areas when making a decision. Doing so can help minimize the over-provisioning risk and ensure a real return on the investment.

1. Look for platforms specifically designed for SMBs. While a vendor’s ability to scale with the growth of your company is important, don’t let your daydreams overshadow your actual needs–starting small can provide a bigger ROI in a shorter period time.

“Buy the shoe that fits rather than buying the shoe that’s two sizes bigger in hopes that you’re going to fit into it over time,” Dhingra said.

The most obvious place to look is the cost per seat: This often tops the $1,000 mark in enterprise platforms, which makes the total cost of ownership (TCO) and return on investment (ROI) case trickier for SMBs. “If it’s now costing you more than a PC, that’s your first red flag,” Dhingra said. He added that TCO/ROI analysis for a 100-seat deployment is not the same thing as a 100-seat proof of concept–with an expectation that several thousand seats will be added later.

It should be noted that for some SMBs, ROI isn’t just a matter of comparing virtual desktop versus traditional PC costs. At Infinity Sales Group, for example, both desktop support and power costs were major factors. For Silicon Valley Builders Group, mobility was the critical payoff in going virtual. In fact, the firm’s CIO noted in an interview that just comparing per-seat costs can be a dead-end: “It would be a hard sell. Virtualization is still something like $1,200 per user, versus a PC I can go buy at Fry’s for $500,” he said.

No matter your particular business case, cost-per-seat is obviously still important. The moral: Don’t pay for seats you don’t need.

2. Know your supporting infrastructure needs. Desktop virtualization doesn’t mean you’re leaving hardware behind. Make sure you have a complete understanding of the supporting pieces you need, both on the server or host side and the client side. For the former, this includes things like servers, storage, and networking equipment. On the client side, don’t forget to account for the actual devices–such as thin clients, for example–as well as your software needs.

Dhingra said not taking all the necessary components of VDI into account is a key budget pitfall for SMBs, particularly if the initial investment is based on an expectation of significant growth. It can also lead an organization to an infrastructure it’s ill equipped to manage.

“That means not only the capital to actually procure [VDI], but then do I have internal expertise within my company to actually deal with this and work with it?” Dhingra said.

3. How many vendors are you willing to work with? Another possible sign you’re headed down a path of over-provisioning: If your desktop virtualization project requires one or more multi-vendor components. This is likely a bigger issue for the “S” in SMB. While a midmarket firm with, say, 750 employees has more resources to manage multi-vendor platforms, a 50-person company might not want the potential headaches. More importantly, it might not have enough IT resources to do so. “It becomes a systems integration project that is typically suited to a larger company,” Dhingra said.

4. How soon until you’re up and running? You can’t really start the ROI meter until your deployment is complete, right? For budget-constrained SMBs, a multi-month (or even year-plus) VDI project adds hidden costs–another form of over-provisioning–that can immediately dull the shine of potential savings. Moreover, smaller companies usually thrive on their speed and agility–IT projects should be no different. Dhingra said IT pros at SMBs should factor training and skills developments here, too: If you lose two days at an off-site training, for example, that’s an expense–even if the event is “free.”

Source

Hosted Voice Expands Communications And Productivity

Leave a reply

Businesses can finally replace their old phone systems and get a far more flexible phone solution for a fraction of the cost. But it’s not just replacing one phone system for another.

With Hosted voice, you get the benefits of a fully managed phone system, which means you’ll need fewer resident experts to handle things. What’s more, Hosted voice expands communications and productivity by providing a range of advanced features and functionality. And it does so without straining your budget.

1. Lower Total Cost of Ownership

Business is more unpredictable than ever––growth one year, contraction the next. Ideally, you’d be able to secure the most advanced technologies without having to spend significant money upfront on hardware. Hosted voice makes this possible.

2. Minimal IT resource

Unlike the complex traditional phone systems that sit in a closet, Hosted Voice requires very little IT support or training to administer. You can quickly add users, delete users, enable additional features––all without additional support or staff. The reason? A simple web interface. In fact, a Hosted Voice solution is so simple and intuitive, users can manage their own features right from their computers.

3. Operating expenditure vs. capital expenditure

The last thing you want to do in this economy, or any economic climate for that matter, is spend tens of thousands of pounds on a phone system. With Hosted Voice, there are no large servers or systems to purchase. Other than phones, there are no capital expenditures to depreciate over time. Which means it comes off your books. All you have is an affordable monthly service fee that connects your business and employees to a host of capabilities that dramatically improve productivity.

4. Business continuity

Let’s assume some worst case scenarios: Your building is flooded, the erratic weather wreaks havoc, or a fire knocks out power for miles around. Now, let’s assume you have Hosted Voice. Want to know how things would be? Business would go on uninterrupted.

Since no physical box resides on your premises – it resides in redundant and secure data centres – customers can still connect with your business because employees can work from anywhere. The reason? A web-based portal that allows you to quickly forward calls to cell phones or other phones in unaffected locations.

5. Scale up/scale down

Five year projections? Ten year projections? Frankly, for most businesses, it has become nearly impossible to make accurate predictions. It’s why you need a highly-flexible technology like Hosted Voice.

Hosted Voice is a sure way to give you the peace of mind that comes from not being constrained by a phone system that only supports a fixed number of employees and can be costly and complicated to expand. If resources become squeezed, you can quickly scale back.

On the other hand, if you open a new branch office, or need to provide remote communications, or just need to prepare for a spike in demand around the holidays, it’s quick and easy to scale up without any disruption to your business. Total flexibility. Easy to manage. Quick to deploy. Hosted Voice is a decision with only upside.

Source

IDC Predicts $1.6B Cloud Market in 2011

1 Reply

The cloud will be discussed everywhere in 2011, but how much money actually is there in the cloud business? In a live webcast event this week, analyst firm IDC’s Research Vice-President Cindy Borovick forecast a $1.6 billion cloud market in 2011.

Borovick’s forecast is not for the entire cloud services ecosystem, but rather is a subset of IDC’s data center and networking forecast. The $1.6 billion figure is IDC’s projection for network equipment revenues used to power both public and private cloud deployments in 2011.

“Cloud is the prevailing IT trend of the decade,” Borovick said. “We really see it as being integral to IT deployments and it’s no longer just a buzzword.”

Borovick noted that cloud infrastructure provides a reduced cost of ownership and enables IT to have a more dynamic response to the business. She added that enterprises get a better allocation of resources with cloud deployments.

Different industries will likely have different adoption rates for the cloud. Borovick noted that highly regulated industries are going to be less willing to trust a cloud provider. That said, she added that the pressure to reduce cost will encourage adoption, even for regulated industries.

“For 2011, we think we’ll see even more announcements from suppliers and IT network managers will be much more ready to look to see how they can deploy the network in support of cloud deployments,” Borovick said.

Looking beyond cloud infrastructure, IDC is also seeing growth in virtualization form factors, though the numbers are still small. Borovick noted that in 2010, IDC forecast that virtual network service form factors would ship during the year. For the application delivery market, Borovick said that the opportunity for virtual form factors was approximately $40 million in 2010.

Multiple vendors including Riverbedand Blue Coat announced new virtual WAN optimization and application delivery offerings during 2010.

“We’re starting to see enterprises decide how it is that they want to deploy virtual network services,” Borovick said.

In terms of who is using virtual form factors today, Borovick noted that cloud service providers as well as smaller data centers are more willing to look at the virtual form factor for a network service

“Additionally there are intricacies in terms of placement in the network and that really dictates where we’ll see virtual form factors emerge,” Borovick said.

For 2011, IDC is forecasting more unified communications applications to take advantage of virtual form factors.

“Networking vendors increasingly will look at how they need to have support for virtual network services,” Borovick said. “Best practices will emerge and we will see an uptick in deployments for virtualization.”

Source

How Management Technologies Will Fulfill Cloud Promises

Leave a reply

Being that we’re at the start of a new year and all, I thought I’d launch the 2011 newsletter by sharing predictions from a variety of network and systems management vendor executives.

Many, of course, have high expectations regarding the continued maturity of virtualization and cloud computing within the enterprise and, along with that, a better understanding of the management challenges and how to go about addressing those effectively. Srinivas Ramanathan, CEO of performance monitoring company eG Innovations, for example, says the key factor determining the success of these technologies will be the total cost of ownership (TCO).

“The lower the TCO, the greater the chance of adoption. By proactively alerting administrators to problems, pointing to bottleneck areas and suggesting means of optimizing the infrastructure, management technologies will play a central role in ensuring that these technologies are successful,” he writes.

Here is an edited version of Ramanathan’s 2011 predictions:

1. As enterprises focus on getting the maximum out of their existing virtualization investments, they’ll look to increase VM density on physical servers. In order to do so, administrators will need to understand the workload on each VM and which workloads are complementary (e.g., memory-intensive vs. CPU-intensive), so IT can mix and match VMs with different workloads to maximize usage of the physical servers. Management tools will provide the metrics that will form the basis for such optimizations.

2. Multiple virtualization platforms in an organization will become a reality, with enterprises hosting the most critical applications on virtualization platforms with the best reliability and scalability and less critical applications on lower-cost platforms. Enterprises will look for management tools that can support all of these virtualization platforms from a single console.

3. As key applications move to virtual infrastructures, enterprises will realize that configuration issues or other problems in the virtual infrastructure also can affect the performance of business services running throughout the infrastructure. Enterprise service desks will need management systems that can correlate the performance of business services with that of the virtual infrastructure and help them quickly translate a service performance problem into an actionable event at the operational layer.

4. Enterprises will realize that desktop virtualization is very different from server virtualization, and that management tools for virtual desktop infrastructure (VDI) need to be tailored to its unique challenges. Having the right management solution in place will provide VDI administrators visibility into every tier of the infrastructure, thereby allowing them to determine why a performance slowdown is happening and how they can re-engineer the infrastructure for optimal performance.

5. Cloud computing will gain momentum, with internal enterprise IT teams continuing work on public clouds and ultimately evolving to hybrid cloud models. Monitoring and management technologies will need to evolve to manage business services that span one or more cloud providers, where the service owner will not have complete visibility into the cloud infrastructure that their service is using. (See also: 2011 tech priorities: Private cloud beckons)

6. Enterprises will move toward greater automation. For all the talk about automation, very few production environments make extensive use of this powerful functionality. For cloud providers, automation will be a must as they seek to make their environments agile. Dynamic provisioning, automated load balancing and on-demand power on/power off of VMs based on user workloads will all start to happen in the data center.

7. Do more with less will continue to be the paradigm driving IT operations. Administrators will look for tools that can save them at least a few hours of toil each day through proactive monitoring, accurate root-cause diagnosis and pinpointing of bottleneck areas. Cost will be an important criterion for tool selection and, as hardware becomes cheaper, management tool vendors will be forced away from pricing per CPU, core, socket or per-application managed.

8. Enterprises will continue to look to consolidate monitoring tools. Tools that can span the physical and virtual worlds, offer active and passive monitoring capabilities, and support performance and configuration management will be in high demand. Consolidation of monitoring tools will result in tangible operational savings and actually work better than a larger number of dedicated element managers.

Source