We are quickly becoming a more software defined world. The music, movie, automotive and telecoms are examples of industries going through disruptiveness due to innovative software defined products. In this new world, IT-operational efficiency has risen to be more critical to businesses than ever.
Thanks to software and open source, the world is a more transparent place. Innovation is as much about speed as it is about coming up with that great next new idea. In efficient markets, ideas are quickly copied. The best way to stay ahead of competition is to continuously bring new products and services to market. The value of speed at which a company introduces new products and improves new versions based on market feedback has become paramount to success. The world accelerates in its need for new products and services. The connected- and smart-phone based economies emerge as the leaders of this new world-order, where new versions of products are introduced to the market on weekly, and even daily basis.
IT-operations play a very important role to support and enable businesses on their journey towards the pursuit of continuously offering new enhanced products and services. Not only is IT-operations an enabler of faster change-cycles, but probably one of the most critical component in ensuring that these new software defined products continuously meet customer expectations in terms of response-times, up-time and quality of service. The market expects products to work as promised, and any deviation will have an immediate negative business impact. In worse case it can lead to brand- and revenue damage. “The importance of IT-operational effectiveness and efficiency grows with the share of revenue deriving from software defined products”.
The following scenario illustrates the growing value of IT-operations. At CFEngine we work with several of the world’s largest financial organizations, and large web-scale companies. These two groups of companies operate very differently due to reasons like culture, complexity and regulations. In a large financial organization a change often requires the sign-off of multiple persons, and the frequency of changes are weekly (at best). Web-scale companies on the other hand have adopted an agile change-process built on trust, automation and audit-trails. These companies make customer impacting changes several times a day. We can safely assume the speed at which web-scale companies operate is 10x faster than the financial organizations.
Assume that Amazon, which is a web-scale company, decides to introduce a digital currency, which they allow their customers to use to buy products on Amazon.com. Think of Amazon gradually becoming a bank where they compete against other banks.
At both Amazon and let’s say Bank A, they come up with this great software based idea at the same time. Amazon is, as we said, able to deploy customer-facing changes 10x faster than the bank. The business impact of IT-operational and IT-development efficiency will be devastating to Bank A in their competition as Amazon will be able to:
- offer the new product way ahead of Bank A
- offer several improved versions of the product based on market feedback before Bank A even comes out with their first version
- get more satisfied customers as they respond faster to customer feedback
- get valuable feedback and data from the market which can be used to come up with new related products
- learn more and thereby become more knowledgeable about their customers needs
The severe business impact of IT inefficiency has lead to a change in the view of IT. It is no longer only the innovators that realize the dramatic impact IT has on business. As more companies wake up to the new world, not even the most sacred cow remains untouchable. We are starting to see the meltdowns of organizational silos, business processes, and rigid cultures. Within application delivery, DevOps has become the new best-of-breed standard, tearing down the walls between developers and operations people, and thereby allowing for a more efficient flow of code from development to production. I call this the vertical meltdown, where every level in the software stack is up for a new dawn. Every process and person involved, from the specifications of a new product or service to its customer facing delivery and maintenance will be reviewed.
The most agile IT-companies, in their hunt for time-wastes and process improvements, have found hardware components to be bottlenecks. This explains why network automation has gotten much attention lately. Soon we should expect storage to enter the scene. This represents the horizontal meltdown. Due to the significant business impact of IT inefficiency, everything from departmental walls and well-established processes are up for radical changes. We have seen this on the application delivery side with DevOps, and the same thing will happen with networking and storage. Processes leading towards trust, automation and audit-trails will become the new standard.
At CFEngine our most automated and thereby agile customers often mention that our software’s ability to support organizational changes and new processes have been of substantial value. This might sound strange, but as the meltdowns start to happen, make sure your automation tool supports these new organizational structures and processes. At the end of the day, there are only two things an IT-organization should be measured on:
(1) Speed to introduce new/enhanced products and services and
(2) life-time quality of service.
The biggest obstacle is not technology, but processes and people. Become a change-agent today and melt those walls down!
