Posts Tagged ‘ITSM’
The Supply Side of the Consumerization of Enterprise Software
Source: http://www.flickr.com/photos/bertboerland/2944895894/
In my recent post about the consumerization of enterprise software I discussed two factors that are likely to accelerate the pace toward such consumerization:
- Any department/business unit that can get a service in entirety from an outside source is likely to do so without worrying about enterprise software and/or data center considerations. This is already happening in Marketing. As other functions start doing so, more and more links in the value chain of enterprise software will be “consumerized.” In other words, these services will be carried out without the involvement of the IT department.
- Once the switch-over costs from legacy code to state-of-the-art code are less than the steady state costs (to maintain and update legacy code), the “consumerization” of enterprise software is going to happen with ferocious urgency.
In this post I would like to add a third factor – the buying pattern. My contention is that the buying pattern for micro-apps will spread to enterprise application. Potential demand for buying in this way is huge. Supply for buying enterprise software as micros-apps is not quite there yet, but it would take only one smart vendor to start transforming the traditional pattern how enterprise software is chunked, offered and sold.
Think about your recent experience downloading an application to your smart mobile phone. You did not go through a six-month evaluation period; you did not do a comprehensive competitive analysis; you did not check how well the seller does customer support in Sumatra. You simply paid something like $7.99 and downloaded the application. You are more than happy if it fulfills your needs in a reasonable manner. If it does not, you simply buy another application with the functionality you desire. Maybe you are a little more cautious now and ask a friend or send an inquiry to your Twitter followers before you pick the new application. Whatever you might choose to do, the fundamental facts are: A) you can afford to lose $7.99; and, B) your time is more precious than the sunk cost of the application. You simply move on.
This buying pattern is not something that you are going to forget when you step into your office in the morning. It makes perfect sense to you and it would be good for your company. You would rather concentrate on your business than on the tricky language of clause number 734 in the contract that your department’s attorney prepared for licensing yet another piece of enterprise software.
The ‘$7.99 experience’ you and zillion other folks like you had over the past week or the past month makes enterprise software vendors extremely vulnerable. The “high-touch; high-margin; high-commitment” [1] business design is not sustainable once the purchase model changes. The expensive machinery of professional services, system engineering and customer support is not affordable at the face of competition that constructs modular chunks of enterprise software and sells them at a price the customer can afford to write off (if they do not perform to satisfaction). Maybe the ceiling in the enterprise to ‘forget about this application and move on’ is no higher than $1,000 (instead of ‘no higher than $7.99’ for the private citizen), but a smart vendor can still make a lot of money on selling at one thousand dollars a pop to the enterprise.
The growing gap between “this lovely application on my iPhone” and the “headache of licensing traditional enterprise software” is an immense incentive for up-and-coming software vendors to use the ‘$7.99 experience’ as the heart of a new business design. This new business design can be simply summarized as “low-touch; low-margin; low commitment” [2]. And, yes, it is very disruptive to the incumbents…
My hunch is that the IT Service Management (ITSM) industry will be the first to crumble. The premise of “service delivery” sounds a little hollow in a cloud computing world characterized by “everything as a service” [3]. Would a buyer be really willing to pay for “service for the service” from a vendor who does not actually provide the underlying service?! It sounds like paying a Fidelity or a Vanguard investment manager to manage a portfolio of their own mutual funds for you…
All it takes for this shift to start – in ITSM or in another part of enterprise software – is one successful vendor.
Footnotes:
[1] I am indebted to Annie Shum for this phrase.
[2] Ibid.
[3] I am indebted to Russ Daniels for this phrase.
A Devops Case Study
An outline of my forthcoming Agile 2010 workshop was given in the post “A Recipe for Handling Cultural Conflicts in Devops and Beyond” earlier this week. Here is the case study around which the workshop is structured:
NotHere, Inc. Case Study
NotHere, Inc. is a $500M company based in Jerusalem, Israel. The company developed an eCommerce platform for small to medium retailers. Through a combination of this platform and its hosting data center, NotHere provides online store fronts, shopping carts, order processing, inventory, billing and marketing services to tens of thousands of retailers in a broad spectrum of verticals. For these retailers, NotHere is a one-stop “shopping” for all their online needs. In particular, instead of partnering with multiple companies like Amazon, Ebay, PayPal and Shopzilla, a retailer merely needs to partner with NotHere (who partners with these four companies and many others).
The small to medium retailers that use the good services of NotHere are critically dependent on the availability of its data center. For all practical purposes retailers are (temporarily) dead when the NotHere data center is not available. In recognition of the criticality of this aspect of its IT operations, NotHere invested a lot of effort in maturing its ITIL[i] processes. Its IT department successfully implements the ITIL service support and service delivery functions depicted in the figure below. From an operational perspective, an overall availability level of four nines is consistently attained. The company advertises this availability level as a major market differentiator.
In response to the accelerating pace in its marketplace, NotHere has been quite aggressive and successful in transitioning to Agile in product management, dev and test. Code quality, productivity and time-to-producing-code have been much improved over the past couple of years. The company measures those three metrics (quality, productivity, time-to-producing-code) regularly. The metrics feed into whole-hearted continuous improvement programs in product management, dev and test. They also serve as major components in evaluating the performance of the CTO and of the EVP of marketing.
NotHere has recently been struggling to reconcile velocity in development with availability in IT operations. Numerous attempts to turn speedy code development into fast service delivery have not been successful on two accounts:
- Technical: Early attempts to turn Continuous Integration into Continuous Deployment created numerous “hiccups” in both availability and audit.
- Cultural: Dev is a competence culture; ops is a control culture.
A lot of tension has arisen between dev and ops as a result of the cultural differences compounding the technical differences. The situation deteriorated big time when the “lagging behind” picture below leaked from dev circles to ops.
The CEO of the company is of the opinion NotHere must reach the stage of Delivery over Development. She is not too interested in departmental metrics like the time it takes to develop code or the time it takes to deploy it. From her perspective, overall time-to-delivery (of service to the retailers) is the only meaningful business metric.
To accomplish Delivery over Development, the CEO launched a “Making Cats Work with Dogs[ii]” project. She gave the picture above to the CTO and CIO, making it crystal clear that the picture represents the end-point with respect to the relationship she expects the two of them and their departments to reach. Specifically, the CEO asked the CTO and the CIO to convene their staffs so that each department will:
- Document its Outmodel (in the sense explored in the “How We Do Things Around Here In Order to Succeed” workshop) of the other department.
- Compile a list of requirements it would like to put on the other group “to get its act together.”
The CEO also indicated she will convene and chair a meeting between the two departments. In this meeting she would like each department to present its two deliverables (world view of the other department & and the requirements to be put on it) and listen carefully to reflections and reactions from the other department. She expects the meeting will be the first step toward a mutual agreement between the two departments how to speed up overall service delivery.
[i] “Information Technology Infrastructure library – a set of concepts and practices for Information Technology Services Management (ITSM), Information Technology (IT) development and IT operations” [Wikipedia].[ii] I am indebted to Patrick DeBois for suggesting this title.
© Copyright 2010 Israel Gat
Prior to Sprint Zero: A Note on Jakob Nielsen’s “Agile User Experience Projects”
Dr. Jakob Nielsen published the results of a follow-on study to his 2008 report Agile Development Methods and Usability. The bottom line from the 2009 study (entitled Agile User Experience Projects) is as follows:
The two main recommendations for ensuring good usability in Agile projects remain the same as in our original research:
Separate design and development, and have the user interface team progress one step ahead of the implementation team. That way, when it comes time to build something, it’s already been designed and tested. (And yes, you can do both in a week or two by using paper prototypes and discount user testing.) Maintain a coherent vision of the user interface architecture. Create the initial vision during a “sprint zero” period — before any implementation has started — and maintain it through annual (or semi-annual) design vision sprints. You can’t just design individual features; they have to fit together into a coherent whole — a whole that must be designed as well. Bottom-up user interface design equals a confused total user experience (the Linux syndrome).
I would like to highlight one implicit sub-aspect of Dr. Nielsen’s good counsel to maintain a coherent vision of the user interface architecture:
- Ensure coherence with the underlying application paradigm
To illustrate the point, think of a Business Service Management Application. You might monitor any number of servers, routers, databases and applications in order to ensure that a service satisfies the corresponding Service Level Agreement. However, the user interface architecture should have service as its fundamental concept. The architecture should certainly enable zooming in on any component of the service. But, the status of any such component (or sub-component) is merely means to an end: reflecting the status of the service and initiating as appropriate action(s) to fix it. Forming a service piecemeal from a number of constituent elements like those mentioned above – servers, routers, databases, applications, etc. – is no substitute to “service orientation” of the user interface.
The reason for my strong emphasis on the service as the most fundamental user interface concept is nicely captured in the article “How to Spell BSM” by BSM Review‘s Tom Bishop:
Most businesses today are so dependent on IT that, if an IT organization does not understand how the business depends on its services, or does not manage those services with that business perspective in mind, they are dooming the business to slow, steady death….
Dr. Nielsen’s recommendation to conceive the initial user interface architecture prior to beginning any implementation work is very consistent with this imperative need in BSM to manage the services from a business perspective. I would actually go one step further and contend that whenever the underlying paradigm changes in a manner as dramatic as the servers –> services in the BSM example above, demonstration of the core concept(s) of the user interface might need to precede the “sprint zero” period. In the context of the overall planning and budgeting process which governs the Agile process, such demonstration could actually be a pre-requisite to launching “sprint zero.”
If you consider this “prior to sprint zero” approach a bit heavy-handed, I would offer a simple test to assess its reasonableness. Play with a number of IT Service Management (ITSM) products that you picked in random. Once you did so, compare the numbers of those that clearly have services at their core, to the number of those that integrated services into their user interface as an afterthought.
Agile Business Service Management
Over the weekend we activated the BSM Review. It is a thought leadership website dedicated to next practices in Business Service Management (BSM) in a way that is appropriate for our era. To quote my colleague and friend Bill Keyworth:
This website is dedicated to the BSM dialogue by whoever wishes to participate. There is no fee to join …no content that requires a subscription …and no censorship of reasonable ideas and questions.
My area of focus in this site is Agile Business Service Management. The term is defined as follows:
Agile Business Service Management (Agile BSM) is the fusion of modern software development methods with the prevailing preference to run IT from the perspective of the business customer. Instead of dividing the “world” to development on the one hand and operations on the other hand, Agile Business Service Management unifies the two to manage them as part of one continuum that improves the delivery and usage of the application to the targeted business end-user. By so doing, it crosses the metaphorical chasm between the R&D lab and the customer door (or laptop, or iPhone, or…)
My research agenda in the context of the BSM Review will be outlined in a forthcoming post. For now, suffice it to say it will primarily be driven by two themes:
- Business alignment: At the heart of it, BSM is a discipline to better align business with IT; at its core, Agile is about “customer collaboration over contract negotiation.” The two are conceptually similar: they express the strong desire in both development and operations to carry out meaningful tasks that have business impact.
- Continuous manufacturing: I view IT as a form of continuous manufacturing. If you accept this premise, the application of Agile concepts, principles and techniques to IT management makes perfect sense. Just as Agile has been influenced by Lean techniques from manufacturing, it has the potential now to influences (continuous) manufacturing in its IT incarnation.
If software development is your primary interest, you might find my forthcoming posts in BSM Review go a little beyond the traditional scope of software methods. If, however, you are interested in software delivery in entirety, you are likely to find good synergy between the topics I will address in BSM Review and those I will continue to bring up in The Agile Executive. Either way, I trust my posts and Cote’s will be of on-going interest to you.
The Agile Executive 