From left: Doug Tutus, Newlease | Peter Stein, Express Data | Courtenay Snell, Jasco Consulting | Nadia Cameron, ARN | Craig van Zeyl, Dataract | Tim Sone, Ensyst | David Hanrahan, Dimension Data | Paul Voges, Microsoft | Jason Arnold-Auland, The Missing Link | Lee Welch, Ingram Micro | Nick Stranks, Ethan Group | Tanya ...
Courtenay Snell, Jasco (CS): We found internal processes being managed to a greater degree, which meant more accountability was being put on the people making decisions. Thus, they were going for choices that provided better reporting facilities, a better way to gain visibility into the environment they were actually spending money on, and it wasn’t just smoke and mirrors. There were no under-the-table deals – it was the accountable, above board and visible changes that made a business impact.
NC: Is that because customers recognise the critical importance of technology to deliver business outcomes?
CS: There’s still a need and want to continually improve, I just think there was reluctance for a while to embrace new things or step outside the comfort zone. We’re seeing things becoming a lot more positive, and the trust factor with our customers is coming back. They’re not getting scrutinised to such a degree, they’re more comfortable that the information we’re putting in front of them is suitable.
David Hanrahan, Dimension Data (DH): I think you’ll see two things starting to change this year. Last year’s spending rates were on the basis of working with already allocated budgets, so people were deciding whether to spend the budgets they had or not. It meant people got a lot more competitive, margins got tighter, and there was a lot more focus on the projects that went ahead. This time, the budgets have been cut, often to where people were running last year. Secondly... the whole visibility of what IT can do and the cloud from a productivity and user perspective, is really starting to drive discussions we’re having around what projects get up this year. It’s not just doing something for IT efficiency and business dashboarding, there’s also a strong focus on what it’s going to do for users as well. We didn’t see that as much last year – it was more the GFC excuse.
Paul Voges, Microsoft (PV): I think customers are a lot smarter now. It’s much harder to say technology will solve the problem, because they have been through several cycles of buying technology and expectations are higher for a start. That’s one thing. But one of the things we all sell, particularly in the services space, is something the customer can’t necessarily see or touch, but which offers productivity and efficiency. Making that real to a customer has become a firmer focus. No matter how good your sales people are, if you’re selling the new features as better on this version than the last version, it’s probably not a good value proposition. Given some of the moves we’ve seen from Government around the education revolution and healthcare, it also shows technology has to play a much more visible role in the economy overall. The challenge with that is people want to see some proof. They won’t just believe that 2010 is better than 2007 – that doesn’t really sell the story.
Check out more information on how cloud computing could affect the CIO
TL: It’s getting across the cost to customers of doing nothing right now. You have to change that mindset and make the business case. If they stick with what they’re doing now, what’s the cost impact opposed to migrating now from XP to Windows 7 for example? We’re seeing a lot of discussions and those business cases being presented at a board level, and having the justification behind that. I think it’s analysis of where the budget is going and whether they can afford to delay it, or do they need to do something right now. Doug Tutus, NewLease (DT): You find certain businesses looking for smarter solutions. What the GFC has done in many ways is open people’s eyes up to more choices. Our channel primarily works in the subscription/cloud side of the equation, where there is strong interest, and that’s quite encouraging for us. Overall, that choice is not being driven by the economy; it’s natural evolution of technology. It’s much like power, water and other utilities we use – today, you just expect it to be delivered. IT is rising to that maturity level overall.
NS: IT is now much more of a mainstream topic area, and not a segment of the business. It’s involved in everything, so you have every sector looking at how IT can aid their business unit. Rather than relying on the old IT manager to do it, the CEO is asking what cloud can do for him, and then asking the IT manager to follow up and research it. What you’re getting is a lot of non-standard engagements with people like us.
TS: Cloud is something we’re actively driving into customers, rather than them coming to us. When we open up those conversations, they’re very aware of it because cloud has become a very public term and everyone wants a piece. Once we get into the details and how it helps, it’s quite compelling.
DH: There are two parts of that cloud conversation playing out: One is the business looking because they’ve run out of datacentre space, or because power costs are going up and they have no where else to put that infrastructure. We’re also getting the more traditional instances where IT has run very reactively, and a lot of those more reactive IT services-focused companies are getting stuck because they don’t have the elevator pitch or position on what is cloud. Because everyone has heard about it, and you’re getting it from all parts of the business [the same is happening with virtualisation], we’re having organisations come to us to help them plan which parts of the business cloud fits, where they can take advantage, and where they should steer clear. They need to have their stories straight, because if they don’t have an answer, they may not have a job.
PS: It’s the same with social media. Within businesses, everyone is so exposed to social media outside of work, and the new guys coming into businesses are saying ‘why can’t we connect like that or just send instant messages throughout the organisation’? So it’s being driven up to a management level, not necessarily the IT level.
DH: At the other end of that, people understand what IT can do for them, but the big concern – some of which was GFC driven – was the focus on understanding what’s happening in the business. If you look at the Gartner Hype Cycle for cloud services over the past year and the past quarter, the lowest point in the graph is cloud services governance. The hype has gone well ahead, but people aren’t sure how they’ll manage in this new world – from a contract perspective, in terms of security boundaries, or whether it has a real impact or not. They’re still struggling to move security around with virtualisation inside their walls. When it moves outside as well, it’s a far bigger struggle. I think they’re being asked hard questions about how to manage these environments that they’re not ready to answer yet.
PS: Do you think security was more apparent in the last year? During the GFC, everyone was putting up walls and barriers and blocking everything out, and the first thing you think of is your insurance policy.
DH: It was more practical than that. We hit a level of server virtualisation that’s driven certain sprawl as well. The gap between the number of physical and virtual servers is not wide enough apart and we’re not getting the amount of efficiency we promised we would. They don’t get the cloud-like scenario where they’ve virtualised everything. They run out of infrastructure space on the floor because they haven’t done capacity management properly. And they also find that with automatically moving services between datacentres, they don’t have management systems in place to find out where it’s running, when it’s running, and if it breaks, who it affects. They’re already seeing that in-house, yet we’re telling them to virtualise everything – switches, servers, storage – and they see the problem getting bigger. Then we’re saying ‘we’re now going to put some of that outside your organisation as well’. I think the enterprise management story will have to start growing and come together again.
