EDS's David Gee on the spectrum of cloud and outsourcing options unfolding before IT architects

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HP's purchase last year of EDS came just as talk of cloud computing options ramped up. So how does long-time outsourcing pioneer EDS fit into a new cloud ecology?

Is EDS, in fact, a cloud provider? And how will IT departments properly factor their decisions on what to keep on-premises in data centers versus placing assets and workloads on someone else's cloud infrastructure?

We pose these and other "fluid sourcing" future questions to David Gee, Vice President of Marketing at EDS, in an interview by me, BriefingsDirect's Dana Gardner. It comes as part of a special BriefingsDirect podcast series from the Hewlett-Packard Software Universe 2009 Conference in Las Vegas this week.

Here are some excerpts:

One of the fastest ways to ... free up more of your IT spend and spend less on maintenance to drive a transformation or innovation ... is to flip the knob between capital expenditure and operating expenditure and to look at a third party or an outsourcer for some help and guidance.

"[For IT spending] 'flat' is the new 'up,' in terms of what the opportunities are. We're also seeing a recognition that six months is the new 12. How do you get to a faster return on investment (ROI)? Don’t show up with a project that has a 12-, 24-, or 36-month timeframe.

One of the things we hear people at Software Universe talking about is performance and quality testing, and do you need all the resources in-house to be able to do that? Or, if you have peak load, why don’t you use a third party to help you do performance, quality, and security testing and, from a software standpoint, maybe even do that in the cloud. You can either use a third party or have it delivered as a service to you inside of your infrastructure.

In my mind we’re a cloud provider. EDS created the outsourcing industry over 40 years ago. Think about everything that we do today in delivering services to our client base. If you then extend that, those services are effectively cloud-based services, depending on what your definition is. In my mind, we’re absolutely a cloud company.

We’re at the forefront of delivering that in multiple countries, across multiple industries and in some cases, highly mission-critical services for airlines and financial institutions. Do they have a consumer orientation to them? Probably not. In fact, you may not even realize that we're doing that behind the scenes for some of the most well-known brands on the planet.

Cloud means a lot of things to different people. Right now, the objective, particularly for large enterprises, is to experiment to understand what the implications are.

Architecturally, it’s very different, particularly as enterprises want to offer services to their end customers. Equally, how does an enterprise deal with or adopt private cloud infrastructure to be able to offer Web services in an architecturally sound, distributed, and scalable way?

First, we can help in a number of different ways from a consulting standpoint, in terms of how to architect around those things. Second, we can build them for our clients and we do that already today in terms of private cloud infrastructure. And, third is to provide maybe just core infrastructure to third parties, and they then build their clouds to offer to the marketplace overall.

My experience thus far has been that clients are looking for leadership, some direction, and flexibility. Certain things I absolutely want to control and retain within my own firewall. Certain things I'm going to want EDS to help me manage, host, drive down operational cost, and provide some level of innovation -- and to deliver those services as effectively private cloud services to my client base and ultimately to their customers as well.

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Winning the quality war: HP customers offer case studies on managing application performance

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Quality early in application development sounds nice, but actually making it happen brings significant cost savings, repeatable quality assurance processes, higher user satisfaction, and shorter development cycles. The results reward developers, end users, and IT operators alike.

To better understand the journey to quality assurance for new applications -- and the processes that work best -- BriefingsDirect interviewed IT executives at FICO, Gevity and JetBlue in a podcast discussion moderated by me, Dana Gardner. It comes as part of a special BriefingsDirect podcast series from the Hewlett-Packard Software Universe 2009 Conference in Las Vegas this week.

Listen as we hear from Matt Dixon, senior manager of tools and processes at FICO; Vito Melfi, vice president of IT operations at Gevity, a part of TriNet, and HP Award of Excellence winner Sagi Varghese, manger of quality assurance at JetBlue.

Read a full transcript of the discussion.

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HP Software marketing head Anton Knolmar delves into creating new IT economies of performance

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Read a full transcript of the discussion.

IT departments are nowadays having to do more with less, gaining additional productivity while spending less money. It sounds simple, but making it happen is very complex.

How do IT departments and companies approach this problem? How will cloud computing and "fluid sourcing" options help or hinder the process? And how can IT budgets slide while expectations rise that new architectural approaches can be adopted with low risk?

To probe deeper into the harsh new IT economies of performance can be managed, BriefingsDirect sat down with Anton Knolmar, Vice President of Marketing for HP Software & Solutions, for a discussion moderated by me, Dana Gardner. It comes as part of a special BriefingsDirect podcast series from the Hewlett-Packard Software Universe 2009 Conference in Las Vegas this week.

Here are some excerpts:

We've just come out of an executive track. We had about 70 people gathered for the discussion. What is at the top of their minds is all about linking IT with the business. This is a story that we've been telling now for more than 10 or 15 years, and the storyline is not over.

They’re still trying to bridge the gap and talk business language, instead of IT language. One the other hand, they're trying as well to look at the emerging trends. What the heck does this cloud means for them? How can you do cloud computing here? Does this bring added value to them? What’s the business outcome they can drive out of those activities?

What companies are facing at the moment is that a lot of these activities that were going on in the past -- utility computing, Adaptive Enterprise, eServices -- failed because they couldn’t be managed, but it was out there on the Web, on the Internet.

Our offerings around the cloud at the moment are governance tools along with the cloud. You can really manage the cloud. You can really secure the cloud. And, you can get the right performance out of the cloud. That’s our offering at the moment to our customers. They can take the first step, get this one right, and move into the cloud environment.

Mitigation of risk will never go away. At the moment, everyone is talking about reduction of costs, but there is always a risk factor attached to it. Hopefully, the outcome will be that a lot of companies can talk about their revenue growth again, moving from 2009 into 2010.

We are ready to drive those three angles. How we can help customers drive revenue growth? How we can help them mitigate the risk? And, on the other side, how can we help them get their costs under control? These are the three angles will be on the table for quite some time.

The developer community, as you said, has different concerns in terms of developing the applications and developing things for the cloud as well. Our approach at this time is that we enable them to have the appropriate developing and testing tools in terms of quality, performance, and security. These are essentially for those people who have to develop applications well for the cloud. Those are blocked in immediately, are ready to go out there, and can be managed across the lifecycle.

Getting the right information at the right place and making the appropriate decisions are still on top of the agenda for lot of our customers at the moment. It’s been the number one issue for quite some time, and I think it will be the number one issue for quite some time.

We have an offering in these four lines of business in HP Software and Solutions. One is, you gather around the Business Intelligence piece. What we are investigating at the moment is really about how can we bring those offerings as more of a direct offering to our customers in terms of purchasing and licensing? How can you bring those offering into kind of a cloud offering?

But, that still needs some further negotiations inside the company, as well, about development products. But that’s definitely an interesting angle.

Read a full transcript of the discussion.

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Who's Architecting the Cloud?

By Ron Schmelzer

This guest post comes courtesy of ZapThink. Ron Schmelzer is a senior analyst at ZapThink. You can reach him here.

As the hype cycle for the cloud computing continues to gather steam, an increasing number of end users are starting to see the silver lining, while others are simply lost in the fog. It is clear that the debate over the definition, business model, and benefits of cloud will continue for some time, but it is also clear that the sluggish economic environment is increasing the appeal of having someone else pay for the robust infrastructure needed to run one’s applications. Yet, all this talk of leveraging cloud capabilities, or perhaps even building one’s own cloud, whether for public or private consumption, introduces thorny problems. How can we make sure that the cloud will bring us closer to the heavenly vision of IT we search for rather than a fog that hides a complex mess? Who will make sure that the cloud vision isn’t just another reinterpretation of the Software-as-a-Service (SaaS), Application Service Provider (ASP), grid and utility computing model that provided some technical answers but didn’t simplify anything for the internal organization? Who is architecting this mess?

Architecture and the Utility Services Cloud

Most of the time, when people point to practical, in-production examples of cloud computing efforts, they are talking about the sorts of utility services offered by Amazon.com, Google, Salesforce.com, and others. The Services offered in these clouds are not built with any particular application in mind, but rather whole categories of applications. For obvious reasons, these cloud providers seek to leverage economies of scale by serving the largest possible audience using a handful of highly reusable Services, where reuse is defined by usage in multiple contexts. For these cloud providers, the utility Services simultaneously provide a source of revenue as well as a platform their customers use to replace proprietary, in-house infrastructure and middleware.

Given that the emphasis of these Services is to meet the needs of a large and

For obvious reasons, these cloud providers seek to leverage economies of scale by serving the largest possible audience using a handful of highly reusable Services, where reuse is defined by usage in multiple contexts.

continuously growing audience who have diverse requirements, the utility cloud provider’s primary focus is placed on infrastructural concerns. As a result, it’s the infrastructure technologists who are in charge of this cloud. When the “architecture team” meets in these cloud providers, what problems are they aiming to solve? Business problems? Certainly not. In most cases, the architecture teams for these providers (of which we’ve been privy to a number of conversations), focus almost exclusively on technology and infrastructural concerns. Key conversations revolve around performance optimization, implementation change management, optimizing the balance between efficiency and cost, meeting reliability and uptime concerns, and addressing privacy, security, and governance issues.

Where’s the business in all this? The answer: nowhere. Where should the business be in all this? That’s a tough question to answer because without Service consumers, the cloud wouldn’t exist at all. However, it is not the goal of the cloud provider to meet any specific business requirements. Rather, the requirements are aggregated to create a business “persona” that is the focus of continual Service releases. In this manner, one could argue that there are no enterprise architects providing any value in this environment. The most pervasive form of architecture done in these environments is more akin to Information Technology Infrastructure Library (ITIL) approaches rather than any form of enterprise architecture (EA). Utility clouds are the domain of infrastructure experts, not business-IT gap bridgers or process modelers, and one could argue that this status quo will probably never change.

Architecture and the Application (Process) Cloud

However, the utility Service vision of the cloud is not the only one. Indeed, we’re starting to see the emergence of application and process clouds that provide the same infrastructural and economic benefits of clouds, but applied to process-specific concerns. These cloud providers enable the outsourcing of entire processes that run in a virtualized cloud environment as a way of handling variability in scale. For example, an insurance company can use a cloud provider's claims processing Service when their internal capacity is not sufficient to meet demand. As long as the process is Service-oriented, this approach works well and leverages the strength of the cloud's abstract infrastructure capability while staying focused on the process. This way, an organization can have its internal processes augmented by third-party cloud processes. For example, insurance clouds provide elastic capabilities for insurance applications as demand ebbs and flows. Likewise, banking, supply chain, retail, and other process-specific clouds provide cloud computing benefits for specific groups of business users.

In this environment, the cloud provider needs to balance two different, but equal concerns:

. . . the job of the enterprise architecture team is to optimize the conceptual equation of producing the smallest set of Services that meet the largest number of business processes.

infrastructural issues of the sort described above, and the challenge of meeting continuously changing business requirements. When application-specific cloud provider architect groups meet, their conversations look very different from utility Service cloud providers. Rather than focusing on infrastructural issues as they try to meet the common denominator of needs (“speeds and feeds”), the conversation usually revolves around how the team will meet new business process requirements given the existing set of Services and infrastructure. In many ways, these teams have a true EA conversation: the continuously changing and diverse business requirements on the one hand, and the technical capabilities on the other. These EA conversations invoke aspects of Agile Methodologies and EA frameworks more so than ITIL. Rather than trying to minimize the set of business processes handled by the cloud, they seek to continuously expand the universe of processes addressed.

As we often discuss in our Licensed ZapThink Architect (LZA) SOA training courses, the job of the enterprise architecture team is to optimize the conceptual equation of producing the smallest set of Services that meet the largest number of business processes. You don’t want to produce too many Services, otherwise there’s waste. Likewise, you don’t want to produce too few Services as that constrains the number of business processes you can address. As new Services are introduced, the universe of business processes addressed likewise increases. Since application / process-specific cloud providers are businesses that must justify their existence by staying focused on the business without impacting existing operations. Sounds like something all enterprise architect teams should do, no?

The ZapThink Take

In many ways, the discussion of architecture has been given short shrift in cloud computing conversations. In much the same way that the Service-Oriented Architecture (SOA) conversation degenerated into a conversation about the (often unnecessary) Enterprise Services Bus (ESB), the cloud conversation is degenerating into one about the infrastructure needed to handle scalable Service provider volume. And where is the conversation about the business process? Unless you are planning to build a general-purpose Service provider cloud to compete with the likes of Amazon.com and others, you should be focused on where the opportunity is: in the process. And to focus on the process while keeping an eye on the technology requires an enterprise architecture perspective.

The mistake that many cloud-consuming companies are making is that the cloud is giving them an excuse not to think about enterprise architecture at all.

Once again, the refrain is that SOA is not something you buy, but something you do. Perhaps we can start hearing the same mantra with cloud computing?

The thought going through the head of many a supposed architect is: “whew, thank goodness we’re putting this in the cloud so that I don’t have to invest in architecture.” Wow, what a mistake. These companies will be in for a rude awakening when they realize that all they’ve done is shifted their internal mess, which at least they have some control and visibility over, to an external mess that they have less control over. Enterprise architecture doesn’t go away simply because someone else is hosting or providing your Services. Organizations that want to have any chance of improving their agility, flexibility, reliability, and performance need to be in charge of their own architecture. There is no other option.

Given that too few cloud computing providers have your business in mind when they architect their solutions, and the ones that have a process-specific business model and approach aren’t concerned with your specific business, it lands upon the laps of enterprise architects within the organization to plan, manage, and govern their own architecture. Once again, the refrain is that SOA is not something you buy, but something you do. Perhaps we can start hearing the same mantra with cloud computing? Or will the cloud succumb to the same short-sighted, market pressure that doomed the ASP model and still plagues SaaS approaches? It’s not up to vendors to answer this question. It’s up to you … the enterprise architect. There are no short-cuts to EA.

This guest post comes courtesy of ZapThink. Ron Schmelzer, a senior analyst at ZapThink, can be reached here.

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HP unveils financial planning and analysis solutions designed to both optimize and modernize IT operations

LAS VEGAS -- Hewlett-Packard (HP) today unveiled its new HP Financial Planning and Analysis (FP&A) solutions, aimed at recession-beleaguered IT executives who need to cut costs, prepare for a service-based future, and run their departments like a business -- all at the same time.

FP&A is part of HP’s expanding IT Financial Management (ITFM) portfolio designed to help chief information officers (CIOs) and IT managers create comprehensive financial transparency, optimize costs deeply but prudently, and newly demonstrate the business value of IT services.

In a related announcement here at the HP Software Universe conference this week, HP unveiled enhancements to its project and portfolio management (PPM) solution for planning and organizing IT investments.

HP also opened its related Tech Forum conference here this week. For the second year in a row, BriefingsDirect will cover the HP Software Universe 2009 conference through a series of podcasts, blogs, transcripts and Twitter entries. [Disclosure: HP is sponsor of BriefingsDirect podcasts.]

Follow the HP Software Universe 2009 conference on Twitter by searching on #HPSU09.

HP Project and Portfolio Management (PPM) Center 8.0 arrives as a key component in ITFM, providing integrated capabilities for IT portfolio investment management, global resource efficiencies and IT financial transparency.

“PPM popularity is on the rise as organizations align planned business investments with IT project portfolios,” said Daniel Stang, principal research analyst at Gartner, in a release.

Analysts in addition to myself are hearing consistently from IT executives that cost-optimization, cost-containment, and cost-reduction initiatives are the top priorities being driven from the business side onto IT.

The business leaders are demanding a clear understanding of all IT costs and benefits as the global recession lingers, if no longer still steeply deepening. HP’s enhanced IT planning and analysis solutions are designed to help IT executives reduce costs without jeopardizing IT's ability to support future growth when it's called for.

The recession therefore accelerates the need to reduce total IT cost through identification and elimination of wasteful operations and practices. But at the same time, IT departments need to better define and implement streamlined processes for operations -- and to show the near and far business value of any new projects.

As part of the opening keynote address here today, Andy Isherwood, Vice President and General Manager of HP Software and Solutions, said the recession compels better management of IT. CIOs need to reduce costs, yes, but they should do so without jeopardizing future growth.

Consolidating IT cut costs and saves energy by focusing on the operational inefficiencies up front. "It's about getting down and dirty, not pie in the sky solutions," said Isherwood.

Along with consolidation, IT leaders can increasingly automate and virtualize infrastructure and data centers. Combined with greater financial management, IT performance analytics, and IT resources optimization, enterprises can cut their IT operations bills while setting the stage for the new phases of advancement.

And those new benefits, said Isherwood, include using flexible sourcing, from on-house premises data centers to outsourcers like HP's EDS, as well as clouds, both on or via off premises partners like Amazon Web Services. As Ann Livermore of HP said yesterday: Everything as a service.

HP is already preparing to better manage and govern the cloud transitions with its Cloud Assure, which joins IT financial management, IT performance analytics, resource management as next major focuses for the HP Software and Solutions group.

To sum up, Isherwood said that HP's major solutions drives are around IT Management Software, Information Management Software, BI Solutions, and Communications and Media Solutions.

HP expects that after a 12-month period of operational optimization initiatives that CIOs will also seek more transformative IT functional delivery improvements, including such next-generation data center bulwarks as consolidation, automation, and virtualization.

Today's pressing IT management and architecture decisions, then, need to gain from better financial management tools, proffer IT performance analytics, and exploit IT resources optimization techniques -- for both near- and long-term benefits.

These financial performance indicator insights and disciplines for IT will also place CIOs in a better position to look at and pursue future flexible and cost-reducing sourcing options. Those are sure to include modernizing in-house legacy deployments, outsourcing to providers such as HP's EDS, and exploring a variety of burgeoning third-party cloud offerings (on premises, off premises, or managed hybrids).

Knowing the true costs and benefits of complex and often sprawling IT portfolios quickly helps improve the financial performance, while setting up the ability to meaningfully compare and contrast current with future IT deployment scenarios. Who knows if cloud computing will save money if we don't know the true costs of all-on-premises approaches?

Gaining real-time visibility into dynamic IT cost structures provides a powerful tool for reducing cost, while also maintaining and improving overall performance. Holistic visibility across an entire IT portfolio also develops the visual analytics that can help better probe for cost improvements and uncover waste.

This is where the HP planning, analysis and financial management solution comes to the rescue in terms of value, optimization priorities, and future planning comparisons.

The HP Financial Planning and Analysis product announced here today is designed to help organizations understand costs from a service-based perspective. It provides a common extract transform load (ETL) capability that can pull information from data sources, including HP PPM and asset management products as well as non-HP data sources.

Cost Explorer, a key component of FP&A, provides business intelligence (BI) capability for visualizing data that is applied to IT costs. Users are able to see data displays color-coded to help identify different dimensions and variants in costs.

HP FP&A can be run as a stand-alone or in conjunction with other HP software products such as HP Project Portfolio Management Center, HP Asset Manager and HP Configuration Management System as well as the newly enhanced version of HP Project Portfolio Management (PPM) Center 8.0.

Along with the software products, HP is also offering consulting services based on best practices, including:

• Strategy and Advisory Services to help synthesize organizational requirements, data, process and technical gaps for developing detailed implementation roadmaps.

• Implementation Services to provide BI services for strategic decision making including forecasting budgetary needs, quantifying the value of IT services delivered to the business, improving cost efficiency, and aligning IT resources with business needs.

• Process Consulting and Solution Implementation Services based on the HP Service Management Reference Model help in deploying HP ITFM and HP PPM to get improved business results.

• Best practices for Configuration Management Systems help accelerate deployment and provide a use model for customers to identify IT assets and relate them to the costs of the services delivered to the business.

Key enhancements to HP PPM Center 8.0 include:

• IT portfolio investment management for improved alignment between IT and business with cash flow analysis that supports business reviews with actionable, real-time information.

• HP PPM Center Mobility Access for governing IT expenditures through secure and automated checkpoints from mobile devices, which send email notifications and workflow actions to cell phones and PDAs.

• Global resource efficiencies for managing human resources with reports and notifications in the recipient’s language.

• Additional IT financial transparency and controls for decision support with a comprehensive financial summary that aggregates IT investment data and related analyses.

• HP Universal Configuration Management Database (UCMDB) integration with HP PPM Center 8.0 provides advanced search capabilities for business and technical users.

• HP Service Manager integration offers a single IT services access point, so users can access services by creating an HP PPM Center proposal from an HP Service Manager catalog item via Web services.

What's more, HP PPM is now available in a Software-as-a-Service (SaaS)-delivered solution that offers accelerated deployment. Expect a lot more from me on this subject, via podcasts and interviews with the key leaders.

HP is also offering new Software Professional Services for HP PPM 8.0, including:

• Solution Consulting Services for PPM 8.0 providing design and implementation consulting to help customers reduce IT costs by automating enterprise-wide portfolio management via services.

• Fast Track Deployment and Upgrades to help speed deployment of the new software.

• Process Consulting Services to help customer make use of best practices guides for industry standards. HP delivers standardized processes based on HP and industry best practices such as Information Technology Infrastructure Library (ITIL) v3, COBIT and ISO

BriefingsDirect contributor Rich Seeley provided research and editorial assistance on this post. He can be reached at RichSeeley@aol.com.