8-14 January 2013 | ComputerWeekly.com

Home Digital strategies News to drive CIOs 2013 set to be the year of digital enablement in 2013 cloud offers a new approach to expect to see a strong focus on security systems digital enablement this year as firms seek to exploit big data, CERN expands sensor networks and the compute power with of Things to create new opportunities

Nationwide’s COO on £1bn it transformation

editor’s comment

Opinion

Buyer’s Guide to

firms go digital to meet business objectives

why it leaders need broader business skills

Downtime

computerweekly.com 8-14 January 2013 1 Sergey Nive ns /Fotolia.com Sergey the week in it

Home IT latest news IT security Autonomy CEO Mike Lynch co-operates UK amateur is top civilian in News in HP fraud probe international cyber challenge Mike Lynch, the former CEO and founder A 26-year-old Essex software developer 2013 set to be the of business intelligence (BI) software firm has finished as the highest-ranked civil- year of digital Autonomy, says he will co-operate with ian and second overall in the 2012 DC3 enablement an investigation by the US Department of Digital Forensics Challenge. Chris Doman Justice into alleged fraud at the company. beat more than 1,200 cyber teams from cloud offers a 53 countries in the challenge, which forms new approach to Internet infrastructure security systems one of the competitions run by Cyber Vint Cerf recalls switch-over to the Security Challenge UK. modern internet CERN expands The modern internet is 30 years old. In a IT for public sector compute power with openstack blog post, Vint Cerf, one of the founding Government targets £600m savings fathers of the internet described 1 January through shared services 1983 as the day the modern internet was The government aims to save £600m per Nationwide’s COO on £1bn it born. ’s chief internet evangelist, year through its Next Generation Shared transformation recalled that it was a momentous day in Services (NGSS) Strategic Plan, which the history. Cabinet Office has dubbed as “ambitious but not without risks”. editor’s comment IT for financial services IT problems cause New Year’s Eve IT for government outage for Lloyds cash machines Immigrants wrongly told to leave UK Opinion Lloyds customers were unable to with- due to inaccurate data draw money from cash machines and Some migrants have been accidentally Buyer’s Guide complete debit card transactions on contacted by Capita and told to leave the to New Year’s Eve, as the banking group UK as a result of inaccu- was again beset with IT problems. Lloyds rate data used in a gov- access the latest it news via rss feed confirmed that customers experienced ernment push to remove firms go digital “intermittent” problems using cashpoints thousands of illegal to meet business objectives on December 31. immigrants.

why it leaders need broader business skills Post Office admits Horizon needs more investigation kp hoto toc Downtime Years of struggle from campaign groups has forced the Post Office to look again at a computer system which has

been blamed for sub-postmasters being wrongly accused s /i ermi n awater of false accounting. Despite numerous complaints the Post Office has consist- ently stated that there is no fault with the Horizon system. But postmasters claim problems with the technology could be generating unexplained losses. Thousands of Post Offices use the Horizon IT system for their accounts. Dozens of postmasters have been charged and even jailed for accounting shortfalls. Others have had to make up cash discrepancies following prosecutions. Some Post Offices have had to close. According to campaigners, the latest development has seen the Post Office admit that it is prepared to look closely to see if there is a problem, and is calling for anybody with information to come forward. Alan Bates, chairman of the Justice for Sub-postmasters Alliance (JFSA), said pressure from groups including the MPs representing sub-postmasters accused of false accounting has forced the Post Office to look again.

computerweekly.com 8-14 January 2013 2 the week in it

Home software IT for entertainment industry Government awards £5m to research 2012 sets new digital sales record of News projects that address cloud challenges over £1bn The government has pledged £5m to 2012 reached an annual record-breaking 2013 set to be the support 13 research and development digital sales total for films, music and year of digital projects that will address the business games of more than £1bn, according enablement and technology challenges hindering the to a UK trade organisation. The figures adoption of cloud computing services. show digital sales have increased 11.4% cloud offers a from 2011, which means that digital sales new approach to IT legislation and regulation security systems account for 25% of the entertainment Ofcom proposes early exit to combat market, according to the BBC. price rises CERN expands Ofcom has proposed an early exit clause Mobile software compute power with openstack for customers of mobile, broadband and Ubuntu Linux adapted for Android landline services, enabling them to cancel smartphones their contracts without penalty if pro- The open source Ubuntu operating sys- Nationwide’s COO on £1bn it viders raised the price. The proposition tem, a distribution of Linux, has been transformation forms the basis of a consultation that was adapted to run on smartphones. Phones launched by the telecoms regulator, fol- running the software will be showcased lowing a year-long review into the fairness at the 2013 Consumer Electronics Show editor’s comment of such contracts. (CES) in Las Vegas on 8-11 January

Antivirus and firewall products Cyber security Opinion issues quick fix for Internet UK to launch public cyber security Explorer zero-day vulnerability awareness campaign Buyer’s Guide Microsoft has released a workaround for a The Cabinet Office is to launch a public to software as a service zero-day vulnerability in older versions of cyber security awareness its Internet Explorer browser that is being programme early this access the latest it news via rss feed exploited by attackers. The vulnerability year aimed at improv- firms go digital affects IE versions 6, 7 and 8, but the lat- ing the online security of to meet business objectives est versions of the browser, 9 and 10, are consumers and small and medium-sized not affected. enterprises (SMEs). n

why it leaders need broader business skills technology at work

Downtime Worldwide IT spending forecast (in billions of US Dollars)

627 2012 Devices 666 2013 694 2014

141 Data- centre 147 systems 154

Enter- 278 prise 296 software Source: Gartner, January 2013 316

881 IT ser- vices 927 974

computerweekly.com 8-14 January 2013 3 analysis Home What should CIOs focus on in 2013? News As the economy shifts, the role of the CIO is constantly adapting. This year, 2013 set to be the expect to see a strong focus on digital enablement. Cliff Saran reports year of digital enablement

cloud offers a new approach to kp hoto toc

security systems /i s

CERN expands O le nAT compute power with openstack

Nationwide’s COO on £1bn it transformation

editor’s comment

Opinion

Buyer’s Guide to software as a service

firms go digital to meet business objectives

why it leaders need broader f 2012 became the year of the tablet and Raskino describes IT consumerisation as a business skills IT consumerisation, what should CIOs be headache for IT – rather like Windows secu- Idoing in 2013? The migration of Windows rity. “It’s a hygiene factor,” he said. Downtime XP to Windows 7 will be well underway and Bring-your-own-device (BYOD) to work many IT departments are likely to put off any is an aspect of IT that CIOs and IT depart- further migration to Windows 8 until this ments will now have to live with and Raskino has been completed. But while the desktop believes modern CIOs are too narrowly strategy is set, mobile device spending is on focused: “Because you haven’t had a deep the increase. structural model for digitisation of your Globally, spending on devices is expected industry, superficial level things happen Government to grow 6.3% to $666bn according to instead,” he said. “BYOD is analogous to the confirms Gartner’s IT spending forecast. superficial websites you had in the 1990s.” digitisation plans in Digital But devices should not be the number one Among the CIOs Gartner has spoken to, Strategy priority for CIOs, says Gartner analyst Mark the big picture is to drive greater use of digi- Raskino, speaking to Computer Weekly. tal assets, though the concept of digitisation. “If you don’t have a big systematic The analyst firm describes a nexus of forces, NHS reiterates change strategy for what technology will namely cloud, social technologies, mobile commitment to do for your business, then the agenda and big data. digitise patient will be filled by superficial stuff like IT These so-called forces redefine the IT records by 2015 consumerisation,” he said. landscape, allowing businesses to become

computerweekly.com 8-14 January 2013 4 analysis

Home more digitised, such as by exploiting big data, sensor networks and the Internet of Things WHY it leaders will be News to create new business opportunities. attending CES 2013 He said CIOs need to have a serious con- 2013 set to be the versation about how their industries work. According to Gartner distinguished analyst, year of digital “All these smartphones have location infor- Mark Raskino, CIOs attending the Con- enablement mation,” said Raskino. “If CIOs in the 1980s sumer Electronics Show (CES) in Las Vegas had access to geographical information they (8-11 January 2013) will be looking to see cloud offers a would have done a lot more with it. How com- what is happening in the Internet of Things new approach to and the future of consumer products. security systems panies use location to optimise their opera- tions is a different conversation to BYOD.” Raskino said: “If you are a car company or a consumer packaged goods company, CERN expands Adding value though IT how will your business change? Even a non- compute power with openstack In a Forrester survey of 1,654 IT decision- electronics company can be influenced by makers at companies with between 100 the likes of Apple and Samsung.” and 999 staff, 64% said improving business Raskino urges CIOs to consider the ques- Nationwide’s COO on £1bn it processes would be their highest priority tion: “How will distribution in my industry transformation over the next 12 months. be changed by the Internet of Things? Their second-highest priority, according to the Forrester survey, is to increase IT capacity/ editor’s comment resources to drive business innovations, while CIOs rated improving IT’s on-time should require less manual intervention. and on-budget performance, as their third- “We have to do all of this in a way that IT Opinion highest priority of 2013. remains agile. IT cannot become the bottle- In the UK public sector, CIOs will be look- neck,” said Creese. Buyer’s Guide ing at an action plan for the government’s Just as in any large organisation, local to software as a service Digital Strategy, particularly around the area government is looking to exploit informa- of improving digital leadership. tion through big data, and support flexible In a briefing document on Government and mobile working to allow people to work firms go digital Digital Services, Socitm, the professional from home. to meet business objectives association for public sector ICT manage- CIOs in the public sector will need to ment, states: “No public sector organisation assess how their security infrastructure can afford to ignore the issue of leadership works within a flexible workplace. why it leaders need broader and the need to provide strong support for it. “We need to harmonise security processes. business skills “We advise everyone to study carefully this This will require unifying user identities,” said part of the strategy in order to apply the prin- Creese.

Downtime ciple of leadership to their local context, tak- He said IT outsourcing, both in the public ing also into account the role of CIOs, where sector and in the private sector, needs to they exist, about which the strategy is silent.” be more flexible to drive transformational Commenting on the local government change. IT agenda, Jos Creese, CIO at Hampshire In some ways, 2013 will represent more of County the same, in terms of IT strategy: businesses › Digitising the BFI National Archive Council, will continue to migrate from XP to Windows › Financial companies leading digitisation race said: “In 7; people will carry on bringing their tablets › John Linwood, BBC CTO, on Olympic output local govern- and smartphones to work; and IT will con- ment, there tinue to juggle budget with the ability to drive remains a priority to reduce the cost of public innovation. service delivery.” However, more of the same will not be This means driving greater value and cut- an effective strategy to help businesses ting costs through the continued roll-out of through the economic storm. Hopefully virtualisation, IT consolidation and stream- 2013 will be the year businesses turn to IT lining internal processes. He adds that local and the CIO begins to steer the digital government needs fewer IT systems and strategy for business growth. n

computerweekly.com 8-14 January 2013 5 analysis Home Could cloud hold the key to the next News

2013 set to be the generation of security systems? year of digital enablement As researchers warn that signature-based security is proving obsolete, suppliers are looking to the cloud for a new approach, reports Warwick Ashford cloud offers a new approach to ecurity continues to hinder organisa- security systems k toc tions in adopting cloud computing, at

least for mission-critical or sensitive T hi nks CERN expands S data applications. compute power with openstack Concerns about sensitive data sitting on infrastructure shared with competitors linger, but the power of cloud computing is now Nationwide’s COO on £1bn it being put forward as an effective way of transformation dealing with increasingly dynamic and advanced threats. Some security suppliers are looking at editor’s comment cloud computing to give them a competitive edge in detecting and mitigating previously unknown threats in near real time. Opinion So can cloud computing tackle new and emerging cyber threats or is this just a new Buyer’s Guide round of security industry marketing hype? to software as a service For some time security researchers have been saying signature-based technologies can no longer cope with the latest threats. firms go digital Because attacks are so frequently updated, to meet business objectives by the time something is recognised as a threat, a new variant has been released Experts say signature-based technologies can no rendering any signature-based security longer cope with the latest threats why it leaders need broader systems impotent. business skills Research by security firm Imperva shows less than 5% of the top 40 antivirus systems Cloud-based intelligence databases

Downtime are able to detect previously non-catalogued In the light of this and similar studies, those viruses initially. at the forefront of security research agree The research, which used more than 80 the time has come for a different approach. previously non-catalogued viruses, also Organisations need to detect threats quickly showed many systems took up to a month or and mitigate them before too much damage longer, following the initial scan, to update is done, but is cloud computing the answer? their signatures. Security firm Webroot believes that, at the “Enterprise security has drawn an imagi- very least, cloud computing is key to the nary line with its antivirus solutions, but the future of defences against malware. Cloud reality is that every single newly created virus Only by using cloud infrastructure is it management may subvert these solutions,” said Amichai possible to scan, analyse and compare platforms key Shulman, CTO, Imperva. unknown software with a variety of malware to security “We do not believe enterprises are achiev- databases, according to George Anderson, ing the value of the investment of billions of Webroot’s senior enterprise product market- Avoid dollars in antivirus solutions, especially when ing manager. security issues certain freeware solutions in our study Rather than put a comprehensive malware with cloud computing outperformed paid solutions,” Shulman said. signature file on each endpoint, malware

computerweekly.com 8-14 January 2013 6 analysis

Home intelligence and assessments are conducted Rose, principal analyst in security and risk at in Webroot’s cloud environment. Forrester Research. News Because the software client does not have But although the cloud-based solution has to receive and process signature files, it has a many benefits, Rose has some concerns. 2013 set to be the much smaller footprint than traditional “Relying entirely on cloud leaves the end- year of digital software clients. point to fend for itself when it is offline. enablement A cloud-based approach, Webroot claims, Although sandboxing may offer some assis- means there is no need for continual updates tance, I would be seeking assurances that the cloud offers a of the software client, faster scans, low local security agent would be sufficiently new approach to security systems impact on system resources and improved resilient and flexible to enable sophisticated effectiveness. functionality and ensure protection in an operating system built for collaboration, CERN expands rather than segmentation,” he said. compute power with openstack “Once a file is deemed Behavioural analysis Similarly, he said, the level of protection Nationwide’s malicious, it is placed in COO on £1bn it relates directly to the strength of the pro- transformation a sandbox for isolated vider’s intelligence network. This is where the established players, such as Symantec execution and deeper and McAfee, have a significant advantage, editor’s comment behaviour analysis with billions of existing file trust records and ” a growth rate of tens of millions each week. “Although a cloud-based solution has Opinion Andrew Rose value, I am still drawn to the hybrid approach, Forrester Research where expansive cloud intelligence networks Buyer’s Guide are supplemented with local behavioural to software as a service analysis of files, local file activity restrictions and resilient local sandboxing,” said Rose. Webroot backs up the low-performance This is where Webroot seeks to differenti- firms go digital impact claim with benchmark tests by ate itself from traditional signature-based to meet business objectives PassMark software in which the security systems as well as other security firms that supplier scored 78 out of 80 or 97.5%, have seen the potential of cloud-based compared with the 55 out of 80 or 69% security intelligence. why it leaders need broader scored by its closest competitor. Webroot’s systems focus on the behaviour business skills of files that try to execute on a system, Customised risk tolerance regardless of whether or not Webroot has

Downtime According to Forrester Research, the move seen that file previously or has a cloud-based to using a cloud-based intelligence data- signature for it. base to deliver real-time threat protection is Any unknown file is monitored and its an established trend with most of the major behaviour recorded as it tries to execute, said security play- Webroot’s George Anderson. ers investing “Once it is deemed malicious, it is placed in › Exploring cloud options › Cloud security: securing your enterprise in this area. a sandbox on the client for isolated execution › Cloud security myths and strategies Security and deeper behaviour analysis, while any firms have actions the file may have taken are automati- realised that, cally rolled back to return the system to the by leveraging their installed base, they can last known good state, reversing only the collect information about file behaviour and changes that the suspicious file made,” he start to make trust-based decisions. said. This means that even while unknown This encompasses the simple white- and malware is active, systems are protected. n black-listing of files, yet steps beyond, allow- ing users to define their own level of risk This is an edited excerpt. tolerance for unknown files, said Andrew Click here to read the full article online.

computerweekly.com 8-14 January 2013 7 Gartner Business Process Management Summit 2013 13 – 14 March | London, UK | gartner.com/eu/bpm Aspire, Challenge, Transform: Driving Breakthrough Business Performance

KEY TOPICS • Making BPM part of the strategic plan • How BPM can enable transformational change • The convergence of cloud, mobile, social and information with BPM • How to establish process ownership and effective governance • Process intelligence and the role of the iBPMS

GUEST KEYNOTES

Business Process Excellence — ‘Ambidextrous’ BPM Mission Critical and Mission Possible

Professor Michael Jim Lawless Rosemann, PhD Expert on Personal Queensland University of Development, Leadership Technology and Change

Agenda designed for Business and IT Leaders

© 2013 Gartner, Inc. and/or its affiliates. All rights reserved. Gartner is a registered trademark of Gartner, Inc. or its affiliates. For more information, email [email protected] or visit gartner.com. Case study Home Handling huge volumes of data is a News

2013 set to be the challenge for Hadron Collider team year of digital enablement CERN has been testing OpenStack private cloud for the last year and hopes to go live with the infrastructure in February. Archana Venktraman reports cloud offers a new approach to security systems

CERN expands compute power with openstack d horvath AR Pa

Nationwide’s COO on £1bn it transformation

editor’s comment

Opinion

Buyer’s Guide to software as a service

firms go digital to meet business objectives

why it leaders need broader he Large Hadron Collider (LHC) “This month, we will upgrade to the business skills in Geneva, Switzerland – which sixth version of OpenStack – Folsom. T aims to answer fundamental We will test it for a month and go live in Downtime questions of the universe’s existence February,” he says. – is one of the European Organisation Moving to a large-scale infrastructure-as- for Nuclear Research’s (CERN) most a-service (IaaS) cloud based on OpenStack important projects. will help CERN significantly expand its But as the LHC produces 1PB of data compute resources and support more than every second, big data and lack of com- 10,000 scientists worldwide using the puting resources were becoming CERN’s infrastructure to find answers to questions Welcome Break Group biggest IT challenges. such as what the universe is made of. revamps HR CERN started using the OpenStack with success private cloud about 12 months ago in the Moving to open source private cloud factors testing environment, upgrading more The IT team started building and devel- recently to the fifth version of OpenStack oping the IT infrastructure for the LHC in – the Essex release. 1999 and 2000, prior to the introduction End of BMC CERN hopes to go live and use private of scalable software services. It is now sponsorship a blessing for cloud infrastructure in production by reworking its tools and processes to use Toyota February 2013, infrastructure manager common open source tools. Motorsport IT Tim Bell told Computer Weekly. But why did the IT team at CERN choose

computerweekly.com 8-14 January 2013 9 case study

Home an open source private cloud over a public Efficient access to big data cloud that promises higher scalability and So how does the cloud help CERN to over- News cost savings? come its big data problems? From an IT “We compared a number of private cloud point of view, storing all the data created by 2013 set to be the and public cloud providers. We were open the LHC was going to be impossible. year of digital to the idea of using public cloud and had “Even if we stored those, we did not have enablement no issues around storing all our data on the public cloud, as it is community-generated, cloud offers a free-to-use data,” says Bell. new approach to elf service user security systems “S - Natural fit But when CERN did its initial cost analysis, kiosks can create CERN expands it found that public cloud was cheaper, but compute power virtual machines in with openstack not by a vast amount. “When we added network costs, the pub- minutes rather than lic cloud turned out to be between three to Nationwide’s waiting days for COO on £1bn it five times more expensive,” he says. transformation As a robust user of open source technol- a physical server ogy in the past, CERN’s IT team decided to go for an open source-based private cloud. editor’s to be installed and comment “It seemed like a natural fit to our IT infra- structure,” says Bell. allocated” But there were other reasons too. Opinion “We did not want just a cloud service Tim Bell, CERN provider – we also wanted other features, Buyer’s Guide such as load balancing and database-as-a- to software as a service service (DbaaS). OpenStack addressed our enough compute resources to analyse that requirements,” he says. data,” says Bell. The open source private cloud infra- The IT team decided to trim the data. All firms go digital structure has been cost-effective for CERN the collision data that comes out of the to meet business objectives because it removes the need for software or LHC is categorised into three subsets – one staff training costs. where the cases and its impact are already “We just take the code from the com- known to physicists, second where the data why it leaders need broader munity and use it. Also, as the engineer- is too complex to be analysed, and third the business skills ing team is already familiar with the open actual data that is important to store and to source infrastructure, no training was analyse. “The data is finally trimmed down

Downtime required,” says Bell. to 6GB a second on average,” he says. One of the biggest advantages of using The high compute resources that the cloud computing is that it has brought IT cloud infrastructure makes available to the efficiency to CERN, according to Bell. IT team makes it easy to store that data Based on the benefits of using the pri- and retrieve it efficiently, according to Bell. vate cloud “Simple things such as replacing a bad infrastruc- memory chip took two weeks in the old › CERN turns on new clustered NAS capability › Cornell CERN project plumps for NoSQL DBMS ture in the infrastructure, but it is done a lot more rap- › CERN unlocks secrets of universe with Agile testing idly in the cloud infrastructure,” he says. phase, he Bell’s big vision for CERN’s private cloud says that infrastructure is to be able to scale up to in actual production it will allow CERN to hosting 15,000 hypervisors on the cloud optimise IT processes. by 2015, running between 100,000 and “Self-service user kiosks can create virtual 300,000 virtual machines. machines in minutes rather than waiting “The cloud project is all about respond- days for a physical server to be installed and ing to the physicists’ IT needs quickly and allocated,” he says. efficiently,” he says.n

computerweekly.com 8-14 January 2013 10 Interview Home Taking the reins of a transformation News

2013 set to be the to change years of under-investment year of digital enablement Nationwide COO Tony Prestedge talks to Karl Flinders about the building society’s £1bn transformation and the future of the firm’s IT. cloud offers a new approach to security systems

CERN expands compute power with openstack

Nationwide’s COO on £1bn it transformation

editor’s comment

Opinion

Buyer’s Guide to software as a service

n 2008, Nationwide deployed systems related to its Legal & firms go digital set out on a journey General insurance business; and completed to meet business CW500 objectives interview Ito replace ageing IT the development of its data warehouses. systems. Years of under- “Last year was the biggest single year of investment meant the the project,” says Prestedge. why it leaders need broader building society’s systems had not been kept business skills up to date, so it committed to spend £1bn on Migration’s final straight replacing core back-end systems that had The latest milestone to be reached in the

Downtime been built in-house decades ago with off- project was the launch of its mobile banking the-shelf banking software from SAP. service, which is built on the new internet At the same time, it chose to move its bank introduced in October 2011. customer-facing delivery channels onto Over the next 12 months, Nationwide will Microsoft software. It also led to Nationwide complete the migration from its previous outsourcing IT for the first time (see , page Unisys core system to SAP, expand from Mobile 6, Nationwide goes outside). retail into business banking, and focus on banking The plan was to make it easier for the meeting government regulations to make innovation company to introduce new systems and at it easier for consumers to switch bank stimulates the same time cut costs. The project, which accounts. It will also focus on “taking SAP banks’ IT spending is due to complete next year, has passed six and other platforms further across the estate, major milestones in the past 12 months. and regular upgrades”, says Prestedge. In 2012 alone, Nationwide virtualised its Despite the turmoil in the banking sector Security desktops; introduced a new mortgage plat- since 2008, Nationwide stuck with the IT concerns hold back mobile form across 740 branches; went live on its plan, investing between £420m and £500m banking SAP core banking system; completed and each year over the past four years. Prior to adoption made available its mobile banking service; this, its annual IT spend was around £150m.

computerweekly.com 8-14 January 2013 11 Interview

Home Now the underlying technology at the NATIONWIDE GOES building society is coming together, the pro- News ject will gradually change in nature. Rather OUTSIDE than having large projects with lots of heavy In 2008, Nationwide did not outsource any 2013 set to be the lifting, it will be more about spreading the IT. Today it works with Accenture, TCS, year of digital use of new technologies within the organi- IBM, Computacenter and BT. enablement sation. This will give Nationwide an oppor- The company has retained control of tunity to further improve efficiencies and its IT design, but has used third parties to cloud offers a customer satisfaction, through scheduled enable it to transform while the business new approach to runs as usual. security systems software releases. The company has cut its operational costs As it moved to suppliers, the building by 10% as a result of the technology already society has reduced its use of contractors, CERN expands implemented. This equates to about £40m. cutting some 200 that were working almost compute power with openstack permanently. Meeting customer demands Nationwide even has 700 people in India. But customer satisfaction is as important as It predicts 60% of IT development and sup- Nationwide’s COO on £1bn it anything for financial institutions. Prestedge port will be offshore eventually. transformation says there has been an improvement in cus- The building society has about 500 tomer experience, according to independent product and infrastructure workers, 80% of research. which are permanent. It has 1,500 transfor- editor’s comment “The customer experience is vital,” he mation and application development and says, citing the three influences on customer support staff, of which 45% are permanent. experiences: products and pricing; channel Prior to 2008, over 90% of Nationwide’s Opinion accessibility; and payments technology. The IT staff were in-house. IT underpinning the building society supports Buyer’s Guide all of these. to software as a service Nationwide’s application development pro- cesses – key to meeting customer demands that, rather than having how to do it out- – will be more efficient as a result of off-the- lined from the beginning. firms go digital shelf software and access to outsourced But Prestedge says Nationwide must bal- to meet business objectives development resources. It will be able to ance accessibility with security, and must introduce new products and services quicker. protect the building society’s identity by With customers using different channels, ensuring the technology does not turn it into why it leaders need broader such as mobile, this is essential. a generic finance bank. business skills Adopting agile development methods Staff confidence

Downtime Nationwide is harnessing new models, An unexpected benefit of the project is how demonstrated by its move to off-the-shelf staff have taken on board what the com- software and outsourcing, and its develop- pany is doing. “We are really beginning to ment methods are changing to become see real confidence from the 22,000 staff in more agile. the organisation of Nationwide’s position in Prestedge says the ideal software develop- the market,” he says. ment methods used would be more akin with The building society has given itself a tech- how Formula nology platform that will support the business › Barclays to give thousands of staff iPads One cars are and keep at least in line with competitors for a › Interview with Bank of England CIO designed – decade. Its costs are coming down, customers › Banks ramp up investment in innovation where com- are happier, and staff are confident. puter-gener- But as for all finance firms, challenges ated images are used and wind is simulated remain, and Nationwide will need to fully to test aerodynamics, for instance. harness its new-found agility – rather than When a new app is required, he says, the repeat the mistakes of the past by under- business should draw a picture of what it investing in IT – if it is to prosper in a tough wants and the developers should work from economic market. n

computerweekly.com 8-14 January 2013 12 editor’s comment Home Big questions for 2013 News Computer Weekly/ComputerWeekly.com 1st Floor, 3-4a Little Portland Street, London he big flaw in most of the IT predictions at this W1W 7JB 2013 set to be the time of year is that technology is no respecter of General enquiries year of digital the calendar. Fast moving it may be, but it’s not enablement T 020 7186 1400 as if the issues faced by IT leaders have changed sud- Editorial denly since we departed for the festive overeating. But cloud offers a Editor in chief: Bryan Glick 2013 is likely to be a time when big questions affecting 020 7186 1424 new approach to [email protected] security systems corporate IT will be answered. Here is a brief rundown of six of the biggest. Managing editor (technology): Cliff Saran 020 7186 1421 [email protected] CERN expands What next for HP? The world’s largest IT company compute power Head of premium content: Bill Goodwin with openstack is a mess. Despite annual revenue exceeding $120bn, its 020 7186 1418 market value is now less than $30bn – a figure less than [email protected] it spent on acquisitions over the past five years. Will HP Services editor: Karl Flinders Nationwide’s 020 7186 1423 COO on £1bn it be broken up, or even itself be acquired this year? [email protected] transformation Security editor: Warwick Ashford Will Microsoft get it? Microsoft remains the domi- 020 7186 1419 nant supplier of enterprise IT software, and that is not [email protected] editor’s Networking editor: Jennifer Scott comment going to change in 2013. But IT decision-makers want 020 7186 1404 to see evidence that Redmond understands the fast- [email protected] changing demands they are dealing with. Senior reporter: Kathleen Hall Opinion 020 7186 1426 [email protected] Can the reformers in government IT win? This is Buyer’s Guide Special projects editor: Kayleigh Bateman a pivotal time for the reform of government IT. In 2012, 020 7186 1415 to software [email protected] as a service important foundations were laid, but those plans need to be turned into actions. Reform needs to be in place Datacentre editor: Archana Venkatraman 020 7186 1411 before the next election in 2015, and much progress is [email protected] firms go digital needed this year. to meet business Storage editor: Antony Adshead objectives 07779 038528 Can the UK become a world-leading digital [email protected] economy? The UK needs an industrial policy for technol- Business applications editor: Brian McKenna why it leaders 020 7186 1414 need broader ogy that incentivises global companies to base their cloud [email protected] business skills operations in the UK, and in which UK digital businesses can Editorial content assistant: Caroline Baldwin thrive and not end up acquired by overseas rivals. In particu- 020 7186 1425 [email protected] lar, it needs significant investment in the IT skills base. Downtime Production editor: Claire Cormack 020 7186 1417 Can IT departments cope with the new tech-savvy [email protected] user? The era of the command-and-control IT depart- Senior sub-editor: Jason Foster 020 7186 1420 ment is dead. For those IT managers determined to be [email protected] digital King Canutes, sticking with their locked-down, Sub-editor: Philip Jones process-controlled, “them and us” approach to users, 020 7186 1416 this year will be one of their last. [email protected]

DISPLAY ADVERTISING Which businesses are ready to thrive in the Sales director: Brent Boswell internet era? As the economy slowly, agonisingly 07584 311889 recovers, the firms that thrive will be those that recognise [email protected] the dramatic changes in customer behaviour brought Group events manager: Chris Hepple 07826 511161 about by technology and invest in IT accordingly. n [email protected]

Bryan Glick Editor in chief

computerweekly.com 8-14 January 2013 13 opinion Home How to estimate IT project timescales News Bob Hughes identifies approaches to working out how long a project should take 2013 set to be the year of digital enablement t is often argued that project productivity-based approach. You management skills are generic identify one or more types of units cloud offers a so a good project manager can of work, the number of which gov- new approach to I security systems manage any type of project. erns the amount of work in a task. While there is a grain of truth in For example, if you were a brick- this, in IT or other technical pro- layer, it would be the number of CERN expands jects, it is important that at least bricks. In software development, compute power with openstack some managers have an under- the work unit might be lines of standing of technical issues. code. In information systems Is it surprising that Crossrail, for Bob Hughes, BCS development, the number of types Nationwide’s COO on £1bn it example, which is recruiting pro- of input, outputs and internal transformation ject planners for the construction of the new tables in a system might be a good indicator cross-London rail line, wants people with an of development. engineering background? This last example is essentially the func- editor’s comment This understanding is clearly important tion point approach. If you have enough past with estimating the effort needed to carry projects, you can calculate the daily average out development. Incorrect estimates are a number of function points of functionality Opinion common cause of overdue projects. created. Say this was 20. If you count 200 function points in a new project, the effort Buyer’s Guide Experience is not enough needed is likely to be around 10 days. to software as a service I have heard a project management luminary argue that even if you do not understand Dividing into sub-projects a technical area, you can always tell when Where there are no convenient past projects, firms go digital someone is lying about it. But when I was a you will have to resort to creating a really to meet business objectives programmer, it sometimes took me longer detailed work breakdown structure, dividing to do a task than I originally told my boss. I each task into its component sub-tasks, then really believed my estimate was correct at breaking them down into lower-level com- why it leaders need broader the time – I was not deliberately lying. ponents until you get to ones you feel can be business skills However, had I been asked to explain how completed in one or two weeks. You can then I had arrived at my estimate, I would have add these up to get an overall effort.

Downtime muttered something about experience. This The beauty of these approaches is that stopped serious discussion of my estimate. if challenged you have evidence to sup- Common sense approaches to estimating port your estimates. Other people can spot For more tips allow the developer and the project manager flaws in your estimates. For example, per- on estimating to have a proper discussion of estimates. haps you have missed an important differ- project ence between the project you are using as timescales, Estimating by analogy your analogy and the current project, and download this Firstly, analogy means you look for a previous you need to make an adjustment to take chapter from Bob Hughes’ task similar to the current one. The actual account of this. n book, Project effort for the past project becomes the basis Management for for the estimate for the new project. Bob Hughes worked on IT projects in the telecommunica- IT-related Some adjustments can take account of dif- tions, energy and local government sectors before becoming a Projects. ferences between the two projects. If you are principal lecturer at the University of Brighton where he gained Includes a 20% challenged about the project you can point to a PhD in software measurement. He is the author of a number discount code on the full book the previous project in support. of books and chief moderator of both the BCS Professional and for Computer Alternatively, if there are details of enough Higher Education Qualifications in IT Project Management. He is Weekly readers old projects of a similar type, you can use a the editor of Project Management for IT-related Projects

computerweekly.com 8-14 January 2013 14 7813_programme_op_Layout 1 28/11/2012 10:25 Page 26

INTELLECT ANNUAL COBALT CONFERENCE

Why being an agent for change an opportunity for groWthis Thursday 14 February 2013 | Lancaster London, W2 Book online @ www.intellectuk.org/cobalt2013

intellect and cobalt corporate What issues will be discussed? finance llp have joined forces to Big data analytics | Enterprise on mobile device | present this must attend conference. Connectivity and bandwidth | Bring your own device (BYOD) | Social in the enterprise | Apps in The event will identify key trends that will define the the enterprise | Consumer app with device | technology industry in the future. It is a unique e-government; authentication | Payments and gathering of industry executives, market analysts, purchasing; e-commerce | Power in the cloud; investors, policy makers, influencers and economists revenue model flexibility/pay as you save from the UK and overseas markets that will provide excellent networking opportunities throughout the day. When, where and how much? Date: Thursday 14 February 2013 Who’s speaking? Time: 09:00 - 18:00 • Andy Nelson, Government CIO, Cabinet Office Venue: The Lancaster London, Lancaster Terrace, London W2 2TY • Victor Chavez, CEO, Thales Cost: £599+VAT Intellect members • Stephen Critchlow, Managing Director, Ascribe £855+VAT non members • Julian David, Director General, Intellect • Dr Gerard Lyons, Chief Economist and Group Head How do I book? of Global Research, Standard Chartered You can book online @ • Alastair Lukies, CEO and Co-Founder, Monitise www.intellectuk.org/cobalt2013 • Paddy MccGwire, Founding Partner, Cobalt Corporate Finance LLP Interested in sponsoring this event? • Donald McGarva, CEO, Amino Communications Ltd We have a number of sponsorship packages • Geoff McGrath, Managing Director, available. For full details please contact Tina Compton, McLaren Applied Technologies T 020 7331 2011 E [email protected] • Anthony Miller, Managing Partner, TechMarketView • Brendan Mooney, Managing Director, Kainos • Simon O’Kane, VP Global Enterprise, Huddle Media partners • Stephen Roberts, Managing Director, Kable • Nick Robinson, BBC’s Political Editor (chair) buyer’s Guide

Home k toc

News T hi nks

2013 set to be the year of digital enablement

cloud offers a new approach to security systems

CERN expands compute power with openstack

Nationwide’s COO on £1bn it transformation

editor’s comment

Opinion

Buyer’s Guide to software as a service

firms go digital to meet business objectives

Buyer’sSoftware as aguide service part 1 of 3 why it leaders need broader business skills How to integrate SaaS with Downtime your local business systems As software as a service matures, CIOs need to look at how well cloud-based products integrate with existing on-premise systems. Cliff Saran reports SAP expands cloud offering with Ariba t is unrealistic for most businesses to move everything into the cloud. Businesses have a acquisition choice: they can run applications in their own datacentre, use a co-location centre or run a fully hosted datacentre. But beyond the question of who owns or operates the IT, CIOs should consider the IBM acquires Cast Ipracticalities of making cloud applications work as part of a fully-fledged enterprise system. Iron to In a recent Ovum report, Exploring Different Approaches to SaaS Integration, analyst Saurabh accelerate Sharma notes the rapid rise of cloud computing in general – and in particular of software as a cloud services service (SaaS) – is adding to the existing heterogeneity of enterprise application portfolios.

computerweekly.com 8-14 January 2013 16 buyer’s guide

Home Sharma writes that many organisations are realising that cloud computing can lead to more information silos and greater integration complexity. He writes: “Ovum believes that the News most prominent driver of services-oriented architecture (SOA) adoption is its capability to meet complex integration requirements, including on- 2013 set to be the premise-to-SaaS integrations and B2B integrations that year of digital involve multi-enterprise process automations. here are enablement “T “There are several common scenarios for integration of on-premise and SaaS applications where SOA is a several common cloud offers a suitable option.” new approach to scenarios for security systems According to Gartner, SaaS integration is taking place and is following the adoption curve of SaaS. In other integration words, as businesses move beyond simply running a CERN expands single SaaS application to making it part of a business of on premise compute power - with openstack process, there is a need to integrate. Gartner believes this is occurring in mid-sized organisations. But over the and SaaS past year, large enterprises are beginning to integrate Nationwide’s applications COO on £1bn it SaaS and non-SaaS systems. transformation Gartner fellow Massimo Pezzini says that, when it where SOA comes to integration with on-premise systems, busi- nesses have to deal with a number of scenarios. First, is a suitable editor’s comment and arguably the most straightforward, is the one-off option extract, translate and load task that needs to be under- ” taken when uploading customer data from a system like Opinion Saurabh Sharma, SAP to .com. But Pezzini says: “We are also seeing integration of end-to-end business processes like Ovum Buyer’s Guide to software as a service Case study: First Hosted firms go digital to meet business objectives NetSuite specialist First Hosted has worked with one customer on integrating an on-premise system from ERP software publisher JD Edwards with a new platform based on the NetSuite SaaS product, for its international subsidiaries. why it leaders need broader Andrew Peddie, managing director of First Hosted, says: “We worked with a US client that business skills manufactures medical devices, which has been running JD Edwards for 10 years. Over time the company had ended up with a system that did what it wanted.” The company wanted to grow outside the US, but it did not make sense to replicate the disparate IT it had built up. Downtime “NetSuite is lower cost, and can be deployed quicker, in a lighter way to an SAP or Oracle system,” Peddie explains. The international business looked at the cost and found the software version of JD Edwards was 10 years old and was heavily customised, so it could not be upgraded easily. The expertise for maintaining JD Edwards was US–based and many people had moved on. When the international business acquired another company, there was no budget left to re-implement JD Edwards. Instead, the company chose to run global sales from JD Edwards in the US and use NetSuite’s OneWorld module for subsidiary operations. “When we were called in, we had to demonstrate what core functionality NetSuite could repli- cate. Each international office runs a separate accounts system.” Initially, First Hosted mapped NetSuite’s 37 standard record types to the same information in the JD Edwards system, which acts as the master database system. After aligning the data, First Hosted developed a tool to run a one-time upload of data from JD Edwards into NetSuite. The two systems are kept synchronised using a web service. When a sales order is taken, the transaction is pushed into NetSuite using web services. The NetSuite system now processes 50,000 orders a day and keeps in sync with the JD Edwards system.

computerweekly.com 8-14 January 2013 17 buyer’s guide

Home hire-to-retire, so the integration requirements are more sophisticated.” IT organisations can continue to use whatever technology they have in place, but Pezzini News warns that cloud service integration has issues different to those of on-premise integration projects. For instance, there is a bigger security risk in using cloud services. Another factor 2013 set to be the is timescale. When people buy a SaaS product, they expect the new software will be up and year of digital running quickly. “Integration has to be available and provisioned quickly,” Pezzini says. enablement Another problem IT departments face, when it comes to integrating SaaS and on-premise IT, is the coordination of updates. Pezzini says: “Salesforce.com updates software every three cloud offers a months. Google updates its software daily, so it is very difficult for users to keep track of all new approach to security systems the changes.” Main SaaS platforms CERN expands Looking at the main suppliers, SAP has made some ustomers compute power “C with openstack progress with its acquisition of cloud-based business commerce network business Ariba in May 2012 and will not only its recent strategy announcement around SAP Hana Nationwide’s run Oracle Red COO on £1bn it cloud integration. According to Pezzini, the Ariba transformation acquisition makes sense in SAP’s integration strategy: Stack. They “Ariba is a procurement platform so it makes sense to integrate with SAP,” says Pezzini. are not naive. editor’s comment SAP plans to deliver pre-packaged integration. Pezzini ven if you run believes some components will be available in 2013. E He says system integrators will be able to use the Hana Opinion an on-premise cloud integration platform to build their own pre-pack- aged solutions. Oracle stack, Buyer’s Guide According to Pezzini, Oracle’s so-called Red Stack to software how would as a service does not yet have an answer to cloud integration. Oracle’s cloud products include SaaS products such as you move RightNow (CRM) and Taleo (talent management). Its firms go digital WebLogic platform is available as a cloud service and it to meet business from Oracle objectives offers service in the cloud. But Pezzini says: “So far, Oracle has failed to address the integra- eBusiness to tion strategy. This is a significant gap, which I am sure why it leaders SuccessFactor need broader Oracle is looking to fix.” business skills In many ways, Oracle has little interest in support- in the cloud?” ing third-party cloud services. The marketing rhetoric assimo ezzini Downtime revolves around the merits of the Red Stack, buying into M P , Oracle end-to-end. But Pezzini says this is unrealistic. “Customers will Gartner not only run Oracle Red Stack. They are not naive. Even if you run an on-premise Oracle stack, how would you move from Oracle eBusiness to SuccessFactor in the cloud?” he says. “Oracle is in a vacuum. It is not saying anything about cloud integration.“ From a pragmatic point of view, CIOs who have bought › IT as a service › Software as a service: A video guide into the Red Stack can use to › Improve sales efficiency with SaaS connect to third-party cloud providers such as SAP-owned SuccessFactors. Microsoft has Dynamics and certainly appears to be making waves in the SaaS market. In theory, the Microsoft story is about writing applications for on- premise and cloud deployment using one application programming interface (API). However, while the APIs for Azure and .Net are similar, they not the same thing. As Pezzini points out, some work is required to migrate a .Net application to Azure, Microsoft’s cloud platform. “Azure SQL is not exactly the same as SQL Server,” says Pezzini. However, Microsoft

computerweekly.com 8-14 January 2013 18 Home recognises its SaaS offerings will have to be inte- grated with on-premise applications. As such, it News is developing cloud integration as part of Azure. Gartner expects to see a product during 2013. 2013 set to be the In 2010 IBM acquired cloud integration soft- year of digital ware, appliances and services company Cast Iron enablement Systems. IBM says the acquisition enhanced its

k toc WebSphere business integration software portfolio. cloud offers a With Cast Iron Systems, IBM clients can expect new approach to T hi nks security systems fast and flex- ible SaaS and cloud application integration in a matter of days (rather CERN expands than weeks or even longer); and to achieve lower cost “The compute power with openstack and higher return on investment in cloud and SaaS mod- consultants els. However, there has been little in the way of integra- tion to date. who work in Nationwide’s COO on £1bn it Gartner expects a higher degree of integration in the transformation future as IBM builds out its SmartCloud strategy and the ecosystem

the role its WebSphere middleware will play in this. surrounding In 2010 Dell acquired Boomi. The Boomi platform editor’s comment connects information between existing on-premise and these cloud-based applications. The company claims it can provide cloud integration in weeks rather than months. applications Opinion Taleo – the cloud-based talent management suite Oracle acquired in 2012 – uses Boomi. offer deep Buyer’s Guide The question is: will Oracle continue to use Taleo, or to software industry skills as a service will it develop its own product? The situation gets more complex because RightNow – which Oracle acquired and know-how in 2011 – provides some cloud integration capabilities, firms go digital according to Gartner. learned from to meet business objectives Informatica, Tibco and Software AG are also expected deploying these to boost their respective cloud integration platforms during 2013. why it leaders applications in need broader business skills Skills integration a particular Forrester principal analyst Liz Herbert discusses a sector” Downtime skills issue with SaaS integration in her report, Clients Need Services Providers That Can Help Them Get The Liz Herbert, Most Value Out Of SaaS. She observes that leading SaaS packages — such as Forrester Salesforce.com, SuccessFactors, Workday, and RightNow Technologies — are primarily horizontal in nature. “But the consultants who work in the ecosystem surrounding these applications offer deep industry skills, › Big data analytics SaaS & cloud management › Vertical software as a service industry-specific templates, and know-how and lessons › What to consider when moving to SaaS learned from deploying these applications in a particular sector,” says Herbert. So there is an issue of combining the horizontal approach to SaaS with the industry expertise built into vertically integrated business processes. As SaaS adoption takes hold in businesses, they will need to link seamlessly to traditional ERP and other on-premise and third-party cloud applications. Unfortunately for IT, the market for cloud integration is still maturing, with little progress expected for the next six to 12 months. n

computerweekly.com 8-14 January 2013 19 Digital strategies

Home

News

2013 set to be the year of digital enablement

cloud offers a new approach to security systems

CERN expands compute power with openstack

Nationwide’s COO on £1bn it transformation

editor’s comment The digitisation of business Opinion The rise of digital strategies is changing the landscape of traditional IT and the Buyer’s Guide data acquired can be used to improve product development. Cliff Saran reports to software as a service ccording to Karl-Heinz Streibich, CEO of software tools company Software AG, the firms go digital time for big IT transformation is over. People no longer buy exciting IT. Rather, IT to meet business objectives must compete for investment. The question is, where will this investment go? Gartner senior vice-president Peter Sondergaard believes technology spending willA be embedded in every product sold. As manufacturers create smart products and digitise why it leaders need broader the supply chain, spending on technology outside IT will increase. business skills At the Gartner Symposium in November, Sondergaard said: “Digitisation is becoming per- vasive. Organisations are moving spending to digital – every budget is an IT budget.”

Downtime According to Sondergaard, as enterprises become digitised, they will create a role of chief digital officer, responsible for the digital strategy of the company. “We have spoken to manufacturing companies where IT is the business, because it creates a competitive advantage,” says Gartner distinguished analyst John Mahoney.

Digital data creates business advantage It is possible to see this today in modern cars, where computers power in-car entertain- ment and navigation, and sensors feed the engine management system. Digitising “Now we have a permanent connection to a car. We can get services into the car, which the BFI creates value for the customer,” says BMW CIO Karl-Erich Probst. National According to Probst, the car is already is a computer. “The BMW 7 Series uses 1,000 dif- Archive ferent computers,” he says. Sensors measure shock, temperature, wheel pressure and how the rubber meets the road. All of these measurements and more are processed by the car’s Government confirms computers to make sure driving is safe, says Probst. digitisation As more electric cars come to market, in-car IT would make it possible for the car to find plans in Digital the next charging station, if the car is permanently connected to the internet. Social media Strategy could be integrated into the car to tell the driver where his or her friends are.

computerweekly.com 8-14 January 2013 20 Digital strategies

Home Data from the car could be used to help BMW improve future cars or to determine poten- tial issues before the owner takes the car for a service. However, there are privacy issues with News the use of customer data, says Probst, so the customer would need to opt in to allow BMW to collect this personal data. 2013 set to be the Data can be collected during product development, however. “We have a test fleet of year of digital electric Mini and BMW 1 cars. The in-car sensors can be used to collect information from the enablement vehicles to help product development,” he says. cloud offers a new approach to “Digitisation is becoming security systems The spread of digitisation It is not just the automotive industry that pervasive rganisations is becoming digitised. . O CERN expands Capgemini has established a digitisa- compute power are moving spending to with openstack tion practice, headed by Simon Short, chief technology officer CTO( ) of its digital. Every budget is applications business in the UK. So far, Nationwide’s an IT budget” COO on £1bn it the company has a team of 100 staff and transformation four clients: Royal Mail for e-business; Peter Sondergaard, Gartner Eurostar’s ticketing system; supermarket Morrison, where Capgemini is building a editor’s comment multi-channel online presence; and the fashion retailer portal, Burberry World. Speaking on how digitisation can be used in business, Short says: “We are working with a vacuum cleaner manufacturer, which is looking at how to create an online presence for every Opinion domestic appliance in the house.” He said another client is working with Capgemini on digital signage at airports, first to Buyer’s Guide direct passengers to the right check-in desk. Then when they have passed through the secu- to software as a service rity gate, the digital signage can be used to display targeted advertising. At the recent SAP Sapphire conference in Madrid, Chakib Bouhdary, executive vice-pres- ident for strategy and business development at SAP, discussed how a fertiliser company firms go digital was using data collected by satellite to survey land. It is using the information to build a data to meet business objectives service that will provide information to farmers on how much fertiliser to use. The fertiliser company has effectively become a data provider. Another example is in healthcare, where one company has pioneered personalisation of why it leaders need broader medical prescriptions. During his keynote presentation at Sapphire in Madrid, SAP co-CEO business skills Jim Hagermann Snabe said the firm was collaborating with healthcare software provider MolecularHealth on a decision support system. The MolecularHealth system analyses a

Downtime patient’s DNA against medical databases to attempt to match the right drug to the patient. CIOs see opportunities in digitisation Digitisation also means companies can rethink business processes, according to Thomas Benthien, IT director at Unilever. “IT plays a key role in India where we deliver a mobil- ity solution to turn local villagers into Unilever salespeople,” he said. They are given mobile access to the Unilever sales application. Benthien regards the change in perception as a huge opportunity for IT. “Now there is a NHS change in perception. The business asks for more, and we need to ensure our governance and reiterates service models are right,” he said. commitment to BMW’s Probst believes every function of the business must appreciate the opportunity digitise patient records by 2015 digitisation has to offer. “Digitisation of the business needs to be understood by every top manager,” he says. And while the business will want to experiment and pioneer digitisation, technology stand- Government ards and methods need to be harmonised across the company. could save “The CIO’s job is to ensure your enterprise uses technology effectively and efficiently to set £1.8bn digitising transactions and deliver strategic objectives of the enterprise,” says Probst. n

computerweekly.com 8-14 January 2013 21 IT leadership skills

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2013 set to be the year of digital s A le n go/i enablement

cloud offers a new approach to security systems

CERN expands compute power with openstack

Nationwide’s COO on £1bn it transformation

editor’s comment CIOs must evolve Opinion to wield greater influence Buyer’s Guide Ernst & Young poll reveals CIOs must break out of their comfort zones and to software as a service develop more rounded business skills. Paolo Cavosi and Michel Savoie report

firms go digital to meet business objectives he CIO has long been positioned as a senior executive on the cusp of becoming a truly strategic partner to the business. But as this research warns, the reality is that relatively few CIOs have so far managed to reinvent themselves sufficiently to actu- why it leaders need broader ally become one. business skills TLess than one in five of the CIOs polled for this study have risen to become a full member of their company’s executive management team. And, when asked about the degree to which

Downtime they participate in strategic decision-making, responses were lukewarm with just 43% rating this as something that they are highly engaged in. Indeed, in their interactions with the organisation’s leadership, today’s CIOs are typically talking most often about IT budgets and IT’s role in business transformations. They are far less likely to be discussing the overall performance of the business or shaping the key deci- sions that influence it. Even when it comes to providing the data needed for strategic deci- sions — arguably the central premise for the “information” part of their title — many CIOs CIOs will are reluctant in their reply. A notable minority (14%) even say that this is simply not some- have to share thing they are called upon to provide. Respondents originating from Eastern Europe espe- control of IT budgets cially lack this input. CIOs’ peers within the rest of the C-suite broadly agree, typically seeing even more limited scope for CIO engagement. In short, despite nearly two decades of debate about the need for a truly strategic CIO role CIOs to emerge, this remains a work in progress. distrust public cloud for mission- Communication still a weakness critical work, Although CIOs have acknowledged for well over a decade the need to develop their softer says IDC skills, not enough progress is being made. When asked to identify skills that are crucial for

computerweekly.com 8-14 January 2013 22 IT leadership skills

Home their role, 81% of CIOs cited leadership and 79% named communication and influencing skills. Both scores were well ahead of IT know-how. News But despite this recognition, it is also clear that too many CIOs do not know what it takes to join the executive management team. One of the most important changes is still often 2013 set to be the forgotten: the need to discuss technology issues in terms of the business value they bring year of digital – whether costs saved, revenues gained, enablement customer satisfaction achieved or similar – rather than in terms of uptime, gigahertz and cloud offers a terabytes. new approach to “In a worrying security systems Too few CIOs bring strong financial literacy to their role. They need to understand how IT number of businesses, spend affects the net present value of the busi- CERN expands ness and consider costs in balance sheet terms the perception of IT compute power with openstack versus profit and loss terms. For too long, CIOs still appears to be have resisted efforts to improve these skills. But they must take action. Nationwide’s shaped by its role as COO on £1bn it The central role that technology has played transformation in nearly every industry and sector of business a helpdesk” since then emphasises just how big an oppor- tunity CIOs have already missed. To help them editor’s comment steer the business, CEOs are in clear need of “co-drivers” who combine technology expertise with business skills. Executive recruiters readily agree, but such candidates are notable by their rarity. To find out why, this research draws on the experiences of many individuals with Opinion the relevant experience on both sides of the fence.

Buyer’s Guide Outdated views of the CIO persist to software as a service Too few CIOs are currently regarded as true members of the executive management team. This limits their potential for change. Many CIOs nowadays appear to be C-level in title only, and this rank is not necessarily reflected in how they are perceived in the leader- firms go digital ship team. Less than one in five hold a seat at the top table and less than half say they are to meet business objectives deeply involved in strategic decision-making. Related to this is a perception that CIOs have a higher regard for the value that they bring to the business than that seen by their C-suite peers. While 60% of CIOs strongly believe that they help enable fact-based decision-mak- why it leaders need broader ing in relation to corporate strategy, just 35% of their C-suite peers agree. But if CIOs are business skills truly going to deliver on the potential remit of their role – and the potential of IT – they will need to work harder to secure their position at the top table.

Downtime Nearly four in 10 CIOs cite overcoming a lack of support from the executive manage- ment team as one of the biggest barriers they face. In a worrying number of businesses, the perception of IT still appears to be shaped by its role as a helpdesk. Indeed, what is clear throughout this study is that the views of the rest of the leadership team often remain stuck in the past, in a time when IT was simply a back-office function that operated the basement datacentre.

The change in IT’s role Most leaders aim to keep any discussions with the CIO centred on IT budgets, with few seeing this as a chance to engage in a wider discussion about the value of technology. Far fewer also see the need for leadership from the CIO as part of a wider sense that the C-suite prefers a CIO who is simply stable, consistent and does not rock the boat much. CIOs acknowledge that it will be difficult to change such perceptions, but doing so will be a prerequisite for recasting the role of the CIO – and IT – within the business Companies are making a shift away from creating their computing resources in-house, toward the unassailable logic of treating this as a utility resource instead. This is not merely a shift in computing architecture; it is changing how companies use IT.

computerweekly.com 8-14 January 2013 23 IT leadership skills

Home Having previously digitised existing processes, many are now wholly automating processes, or simply removing them altogether. News “We are on the threshold of a major change. A new set of technologies, such as vari- ous cloud solutions are going to be so compelling, pervasive and cost changing that CIOs 2013 set to be the will increasingly stop buying and building their own capital infrastructure for IT,” says Dave year of digital Ryerkerk, Global IT Advisory Leader at Ernst & Young. enablement Volker Raupach, vice-president IT Automotive Experience Europe of Johnson Controls, a major automotive supplier, says that this, in turn, is commoditising many aspects of IT, steer- cloud offers a ing the role of the CIO toward more of an information and process manager. new approach to security systems Paolo Cavosi, EMEIA IT Advisory Leader at Ernst & Young, says this commoditisation process has been going on for a long time, but continues to shift into CERN expands new areas of IT: “Take an IT service like helpdesk, “We are on the compute power with openstack which used to be handled within IT, but is now nearly threshold of a always handled externally. “The same process is happening across other aspects major change Nationwide’s ” COO on £1bn it of IT, such as network management, storage, virtualisa- transformation tion and so on. All this implies a new set of trends, with Dave Ryerkerk, new skills demanded of the CIO. Ernst & Young Many CIOs describe this consumerisation of IT as editor’s comment an inflection point: a transition where the rest of the business starts to feel able to implement technical solutions, without the CIO. But few technology leaders have looked far enough ahead to see Opinion the real long-term transition happening. “To be successful they will need to be something of a visionary, to really understand how this is going to change operating and process models,” Buyer’s Guide says Ryerkerk to software as a service The road ahead A more senior role is inevitably more political in nature, making the need to win friends and firms go digital influence people far more important. The transition to the modern CIO role requires many to meet business objectives incumbents to put a far greater emphasis on relationship-building and fostering better links with a wider range of stakeholders both within and outside the business. There is wide agreement that developing these skills is the number one thing that CIOs why it leaders need broader can do to bolster their chances of promotion, with nearly three-quarters considering it highly business skills important. Nevertheless, few appear to relish the task. When asked about key priorities for the years ahead, internal politics ranks low for most respondents.

Downtime More copies of Dale Carnegie’s classic work on winning friends and influencing people will doubtless be needed as CIOs work to secure the relationships they need. Compared with many other C-suite roles, CIOs have wide-ranging opportunities to influence and effect change across the business. But few have taken action as yet. This will need to change, not least given the underlying shifts in the dynamics of the › Download: The DNA of the CIO technology industry. The DNA of the CIO provides CIOs with › CIOs debate the future of the datacentre a robust and balanced toolkit on what to change, who to › UK CIOs see EU regulation as key influence and how to do it. But it will be up to CIOs them- selves to find the courage to reinvent themselves. The clear message from many CIOs — old and young, in mature and rapid-growth markets,spanning a range of industries — is that the status quo will need to change. In order to stay relevant in a rapidly-evolving technological landscape, CIOs will need to break out of their comfort zones within the datacentre. Those who don’t will run the risk of being further relegated down the corporate hierarchy or side-lined altogether. n

Paolo Cavosi is IT advisory leader and Michel Savoie is IT transformation leader at Ernst & Young

computerweekly.com 8-14 January 2013 24 downtime

Home

News

2013 set to be the year of digital enablement

cloud offers a new approach to security systems

CERN expands compute power with openstack

Pirates versus plumbers choosing their knight in shining armour, the Nationwide’s COO on £1bn it With a childhood spent mostly being a player develops the relationship through transformation plumber and rescuing a princess from choices they make in the story line. a castle, Downtime has learned a few If the title of one game is anything to go things. Mostly it has learned that being a by – Pirates in Love – it would seem nautical editor’s comment plumber and rescuing princesses can be a scoundrels are very much in vogue in Japan. lonely experience. It has now also learned that backing the Value of money lost on Chelsea tweeter Opinion plumber may have been a mistake, as the It seems that fans of rich football club soaring popularity of role-playing Mr Right Chelsea have learnt from Russian owner Buyer’s Guide games among single Japanese women Roman Abramovich and taken to throwing to software as a service would indicate that a man who can fix your their money away. taps is not the dream ticket Downtime One individual, who Downtime can always assumed it was. only presume is a fan of Fulham's second firms go digital A typical scenario in these romance club, was so confident Chelsea would win to meet business objectives simulation games, according to Reuters in against bottom-of-the-table QPR that he Tokyo, is that after being saved from kid- used Twitter to bet his bank details on it. napping, you discover you are the daughter He announced to followers that he would why it leaders need broader of the prime minister and your life is in publish his bank details if Chelsea lost to business skills imminent danger. You are introduced to QPR. Guess what... Chelsea lost. a handful of handsome bodyguards and It seems money is not only meaningless n Downtime must choose who will protect you. After to Abramovich, but also the club’s fans.

Don’t be evil: Schmidt travels to North Korea

Downtime was interested to hear that Google’s Eric Schmidt is visiting North Korea on a “humanitarian” trip. It’s hard to imagine what could possibly come of the meeting, as North Korea is one of the poorest nations on Earth, with only the elite of Pyongyang having internet access. Asia expert Victor Cha wrote: “Kim Jong Un clearly has a penchant for the modern accoutrements of life. If Google is the first small step in piercing the information bubble in Pyongyang, it could be a very interest- ing development.” Read But it’s also difficult to picture what the ruler of the largest surveillance more on the body in the world and the North Korean leader could have in common Downtime blog to talk about...

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