Business Technology Leader Maturity Framework

As 2009 comes to a close, a recent editorial in CIO magazine sums-up a nagging issue -- "Despite the emergence of improved IT management tools over the past decade, CIOs continue to grapple with the same IT challenges they dealt with five and even 10 years ago. Which can make a CEO wonder: when are we going to get there?"

Forrester Research believes that CIOs have typically run "the tech factory" for their firms -- responding to business needs with solutions and operations from both internal and external sources. These IT leaders have pursued operational maturity to optimize solution delivery.

Forrester says that CIOs won't ever get away from delivering on operational maturity. But as technology becomes pervasive -- more stable, standardized, and available as a business-centric service -- it's inevitable that business executives will take greater direct control over technology investment decisions.

Forrester calls this evolutionary transition the shift from Information Technology (IT) to Business Technology (BT). Let's review the key drivers of this transition once more. It's the essential "there" destination that many CEOs eagerly anticipate for their organization.

Greater Response to Business Demand
Traditional IT establishes prioritization criteria and IT governance processes. Weighed down by growing legacy maintenance, typically a third of IT spending is reserved for new projects. IT therefore creates conflict among business organizations -- who must lobby for those limited IT resources.

Broader Focus on Business Value
IT should help deliver business results, yet it's often consumed by technical issues -- re-educating staff, deciding what to re-architect, and debating whether to build or out-task. Meanwhile, new capabilities are increasingly available through managed cloud services -- and purchased directly by business groups via software-as-a-service.

Significantly Faster Pace of Change
The rate of business change continues to accelerate, forcing CIOs to be reactive -- while attempting to increase agility. The CIO's dilemma: either their business organizations will move ahead without internal IT, or, their business executives will fail to take full advantage of new technologies in time to use them effectively.

Framework for the Required Transformation
To help CIOs understand best practices, Forrester has developed a BT Leadership Maturity framework in the form of a self-assessment. This tool is designed to provide a candid benchmark of how well they are performing -- highlighting specific areas where additional work needs to be done.

Forrester concludes that CIOs who fail to move quickly will find their firm falling behind more agile competition. Those who assess and improve their organization's BT leadership maturity are responding to changing market realities -- as well as reducing the likely chaos that would result from allowing the business to move forward on its own with BT, without the CIO's close involvement.

IT Managers Share Their Cloud Experiences

The common best-practices associated with managed cloud service utilization are hard to find, since the early-adopters rarely share their insights. Of course, for all the other people that are still assessing the potential benefits, that guidance is truly invaluable.

Therefore, it's very helpful that Forrester Research was able to interview more than 60 organizations that are currently leveraging Infrastructure as a Service (IaaS) cloud-based solutions within their business environment.

Forrester defines public IaaS cloud computing as the delivery of compute (virtualized servers, storage, and networking) on-demand as a shared service. Based on their findings, they say that the evolving usage characteristics fall primarily into three emerging practices.

Test and Development in the Cloud
The most common practice they found among enterprise users of IaaS cloud platforms was to build and validate new apps. Cloud platforms provide relief for in-house test and development teams who face resource constraints. Moving these actions to the cloud relieves a significant IT burden, but only for apps that are suited to the cloud -- those that can fit within the confines of a virtual server.

Deploying Web Applications
The majority of applications deployed on public cloud infrastructures are Web-based apps. Early users of IaaS clouds have found the greatest benefits with Web apps that are short-term oriented and/or unpredictable or volatile traffic patterns. These types of apps can best take advantage of the pay-per-use element of cloud infrastructures to right-size the cost of deployment to the behaviors of the apps.

High-Performance Computing
Another good fit with IaaS cloud platforms is high-performance computing. These often massively parallel programs can be scaled-out to effectively tackle very large problems, and the constraints of HPC are usually the size of compute grid that can be deployed. Enterprises are constantly having to trade off grid size and cost against speed of getting the result. Apparently, IaaS clouds provide relief to this tension.

Next Wave of Manage Cloud Service Apps
According to Forrester, given the above mentioned IaaS best practices, the next wave of cloud services best practices that infrastructure and operations professionals should focus on are as follows:

• Leveraging cloud management applications and services.
• Cloud bursting -- to maximize scaling within the cloud.
• Integrating cloud services with data center services.
• Leveraging cloud-scale services.
  

The Beginner's Guide to Cloud Adoption
So, where should you start? Forrester suggests, make sure you have supportive executives who will view your use of cloud computing as empowering for the business -- not as a threat to infrastructure and operations. Then, start experimenting with the common applications listed.

Clearly, IT and network out-tasking has a place in most organizations. Forrester says that their key findings show that cloud, while truly compelling, shouldn't be viewed as a replacement for the data center. It is, however, a viable alternative approach to consider.

Five Proven Benefits of Cloud Services

How can your company get started with cloud computing? Well, consider following the market leaders. With a few more months of client experience, Forrester Research recently addressed the major questions that executives have about the adoption of cloud services.

The key benefits that most early adopters report do not start with costs -- but rather with business flexibility. According to those that have deployed it, the benefits of cloud computing, in order of importance, are:

1. Improving time-to-application deployment. Cloud platforms give you the option of developing and deploying new applications on existing infrastructure as quickly as desired. Traditional platforms can take up to three or four months to procure, install, and configure, stalling the application deployment process.

2. Aligning IT budgets with application demand. How many Web applications does your organization deploy without exactly knowing how popular they’ll be or how much capacity you’ll need to accommodate that popularity? Many of the early cloud adopters host customer and public-facing Web applications with cloud providers for this reason. They can pay just for the resources they use, hour by hour.

3. Accommodating peaks in demand for data center capacity. Cloud computing is also good for handling episodic spikes in demand for computing, storage, and network resources. Rather than provision for the expected peak of the holiday shopping season, retailers can push the additional demand into a cloud environment. Big batch jobs also fit this model.

4. Delivering applications without raising the budget. Cloud computing gives you the ability to deliver new applications without having to buy systems, avoiding an investment of your firm’s capital in new equipment. Application development and delivery can all be handled using pay-as-you-go operating expenses.

5. Sharing without putting the data center at risk. Many of the early adopters of cloud computing are looking for an inexpensive and easily accessible way to share information. Medical researchers are an example. Cloud services enable these organizations to host data on public clouds, rather than making their internal data center available to external parties.

Three Questions to Ask a Cloud Service Provider
How do you know if a managed cloud service provider is a good-fit for your business? Forrester concludes that you should ask all providers the following three basic questions:

• What are your enterprise references and what kinds of applications do those organizations run in your cloud?
• For which application scenarios does your cloud environment deliver the maximum flexibility and scalability?
• What security and reliability commitments do you make to your customers?
  

Revelations from Online Collaboration Adopters

Cisco conducted one of the first comprehensive studies of the factors associated with successful adoption of network-based collaboration solutions. You can use the study results to maximize your return on investment from today's online collaboration tools.

One way is to implement business practices shown to lead to more enthusiastic collaboration. Another is to identify and then actively support the employees who are most likely to benefit.

Twenty First Century Collaboration
Collaboration is a process that brings people and information together to accomplish a common goal. What's new today is that in a connected world, people no longer have to be in the same location, time zone, or culture to collaborate.

Tools such as videoconferencing (or TelePresence) and web sharing enable real-time collaboration across distance. Blogs, wikis, and shared workspaces enable online collaboration across time boundaries.

Cisco conducted the first formal segmentation study of collaboration tool users. Their objective was to understand how workers choose to collaborate, which tools they use, and how they believe those tools positively affect productivity, innovation, and cost savings.

Study participant collaboration habits and attitudes placed them into one of four segments: Collaboration Enthusiasts, Comfortable Collaborators, Reluctant Collaborators, and Collaboration Laggards.

Lessons Learned and Best Practices
The results from the Cisco collaboration segmentation study suggest that organizations experience the greatest productivity benefits from collaboration when they:

• Recognize that personal attitudes and organizational culture regarding collaboration are as important as collaboration tools.
• Begin by introducing collaboration tools to people and groups meeting the characteristics of Enthusiasts and Comfortable Collaborators. These people tend to be managers or supervisors, have held their job position for 3 to 10 years, and are already using Web 2.0 tools at home.
• Encourage executives to model the desired collaboration practices.
• Reward collaboration by including it in performance reviews, offering rewards for successful outcomes, or both.
• Implement formal collaboration processes. Provide the tools, IT support, and training needed to foster increased collaboration.
  

The survey studied 800 people in a wide variety of U.S. medium-sized and enterprise organizations who: spend at least 20 percent of time at work using a network-connected computer; use a mobile phone or handheld device; and participated in two collaborative activities within the past month.

Enabling the Early-Adopters to Thrive
The researchers conducted a segmentation analysis, separating individuals into distinct groups based on a large set of attitudinal and behavioral variables. Previous knowledge of collaboration habits did not include the personal or cultural factors that influence success.

Do you proactively nurture a culture of collaboration in your organization? What obstacles did you have to overcome before your employees could fully utilize the latest online productivity tools?

The Secret of Business Growth in 2010

Having had their fill of the economic downside, business leaders are truly ready for the eventual upside. Apparently, U.S. companies are preparing for a global economic recovery to begin in the first half of 2010, according to a new "Road to Growth" market study from AT&T.

Key study findings include the following insights:

Business Agility and ROI Pressures
In today's economic climate, U.S. companies have significantly shortened the time frame over which a Return on Investment (ROI) is delivered.

More than half of U.S. IT executives stated they are under pressure to deliver a return on investment in half the time than their previous efforts. As a result, two-thirds cited that the change has affected their IT budgets, strategies and priorities.

The study found that companies are less willing to invest in longer-term projects -- where the return does not come quickly. One CIO stated that IT projects must give at least a 100% ROI in 12 months -- otherwise, the project is terminated.

Shrinking Costs, While Growing the Upside
No surprise, regarding the top-of-mind challenges. Cost cutting and increasing revenue remain the two primary business goals. To achieve those objectives, survive the recession and move towards growth, business technology strategies are focused on:

Reducing operating costs: 87 percent cited "reducing operating costs" as "extremely or very important." Improve collaboration with customers and partners: 85 percent cited "improved collaboration with customers and partners" as "extremely or very important." Enhancing workforce performance and productivity: 83 percent cited "enhancing workforce performance" as "extremely or very important."

Rise of the Any-Term Business Strategy
The study found that U.S. companies employ multiple strategies to address business goals, and do not distinguish between short-term and long-term strategies. It appears that U.S. companies are reducing the time period for their long-term forecasting until after the recession is over.

Moreover, the role IT plays in helping U.S. companies achieve long-term strategies is very similar to the role IT plays in supporting a company's short-term business strategies.

Ongoing Role of Business Technology
IT investments and priorities are very focused in a couple of key areas. The study found that "business continuity and security solutions" will have the biggest positive impact on business growth as U.S. companies prepare for an economic turnaround.

This is closely followed by "enterprise mobility solutions" and "Web delivery solutions." Areas of IT investment that are expected to have a high to moderate impact on businesses are "unified communications services" and "hosted solutions."

For more information, and a copy of the executive summary, visit the AT&T Road to Growth Study on their website.

How to Unlock the Power of Virtualization

Virtualization uses technology to remove the physical barriers associated with computer servers and applications -- enabling the consolidation or replacement of servers, storage, network and other physical devices.

As a result, your business can better use computing capacity and drive more value from IT resources as well as consolidate data centers and significantly lower energy consumption.

For companies who need guidance on a virtualization project, Verizon Business offers these five tips -- culled from the company's years of experience handling complex IT installations and expertise in implementing and managing virtual environments:

1. Make sure you're looking at the big picture: A business should first complete a thorough assessment of its current IT environment and computing resources, including a full review of all servers. Once the enterprise has a better understanding of its infrastructure, it is easier to determine which computing resources, such as servers and devices, are candidates for consolidation.
2. Enlist vendor support: After compiling a list of applications that can be virtualized, it is important to confirm there will be very few, if any, issues with vendor support. Some vendors, especially smaller ones, do not support their software on virtualized platforms.
3. Evaluate licensing costs: When assessing applications for migration, evaluate the licensing costs associated with them. While consolidating multiple servers and devices into a single virtual machine will lower hardware and facility costs, this does not necessarily apply to software licensing costs. Many vendors still charge based on total available power and the number of physical applications. If that's the case, consider working with vendors that embrace more flexible licensing models.
4. Avoid common bottlenecks: Carefully assess the memory and storage requirements for applications moving to the virtual environment. Memory and storage can severely limit how many virtual machines a host can support. A common scenario is an environment with consolidated storage and a high number of mobile BlackBerry users, requiring large memory and storage needs. Therefore, assessment, management and proper allocation of applications per virtual machine are key.
5. Security, security, security: Security should be a top priority; it should be built in from the ground up to ensure the new environment comes with the right safeguards. Enterprises also should pay close attention to relevant industry regulations. For instance, businesses that store, handle or process customer payment information must maintain compliance with the Payment Card Industry Data Security Standard (PCI DSS), a comprehensive set of requirements for enhancing payment account data security. In that case, PCI DSS compliance would be a key requirement for the new virtual environment.
   

"Virtualization holds huge promise for the enterprise," said Michael Marcellin, vice president of Verizon global managed solutions. "Its ability to increase efficiency and agility while managing costs is unparalleled. With that potential, however, comes complexity concerning deployment and implementation. Our hope is that enterprises will take this promising technology to heart and embrace our suggestions -- based on our more than 10 years experience managing complex IT infrastructures -- on how best to utilize it."

Verizon Business offers a wealth of IT and hosting solutions to help customers meet their most-pressing IT needs in today's dynamic business environment. As we've previously reported on the Business Technology Roundtable, enterprise and small-business executives are actively adopting the selective out-tasking of applications to these managed cloud services.

IT Power Users Will Lead the Way

Have you ever wondered if your company's utilization of Business Technology is in line with the creative market leaders? The Harvard Business Review recently published an interesting commentary by Susan Cramm entitled "How to Support Your IT Innovators."

Ms. Cramm believes that to realize the full potential from business technology, all enterprises need IT-smart business leaders -- up, down, and across the organization.

According to the results of her ongoing survey, however, business leaders apparently don't feel very smart about their IT adoption and application practices.

• Only 11% personally use and fully leverage the capabilities of the technology currently in place.
• 50% agree with the statement that "business leaders don't understand how to use their systems and technologies."
• And, only 25% of business leaders consider themselves "IT-smart."
  

Liberate the Business Technology Innovators
One person she interviewed said "business groups that have somebody on their team who is an IT expert do much better -- in terms of leveraging technology to meet their needs -- than those who do not." While that may not be profound, it's a noteworthy comment.

Tech-savvy business users perform a valuable function for their less-informed peer group. They are able to determine what is truly possible, with current technology. Why? It's because power-users sometimes have better productivity enhancing tools in their home-based office than they do at their place of work.

How can this be possible? Well, IT managers focused on total control of all physical infrastructure are consumed by operational tasks and remedial user support activity. They have little or no time available to research, test and adopt the best-fit productivity tools for their business user needs.

Don’t Assume, Follow the Informed User
Moreover, there's often a major disconnect between what business users say they need, and what their IT team assumes they would apply. Most organizations use only 64 percent of their enterprise systems core functions, according to a recent Accenture survey.

"About half said they don't need all the capabilities, while a fifth explained that they didn't make use of all the functionality due to lack of time to learn how to apply them," said Accenture.

In summary, Ms. Cramm says that you should identify your lead users, give them more of what they really need, free up your IT team's time to study what they are doing (and why), and then decide how to standardize and scale the most promising innovations to benefit the whole enterprise.

Managed Service Buyer Checklist – part 2

The following are questions four through seven of a ten-point Q&A designed to help guide your managed or hosted service procurement process. Here are the first three buyer questions and service provider answers.

4. What is the depth and breadth of your current managed service portfolio?

• A service migration path provides the means to adapt to your growth needs.
• Service providers that are specialists may offer services through their partners.
  

It helps to have a forward-looking view of your needs when selecting a service provider. Sometimes a specialist is preferable to a multi-service provider. Otherwise, try to anticipate future service requirements, and consider giving preference to a provider with those combined skills.

5. How can I be sure you will apply the best people, processes, and tools? Is your company certified by a leading vendor, and are your offerings delivered using industry-leading technologies to meet the highest quality of service?

• Service providers have data on how they've qualified to meet standards.
• Providers are often required to attain a "qualification level" that is tiered.
  

The good service providers will achieve basic industry-standard technical certifications. The better service providers will comply with the ITIL foundation practices. The best will have passed the stringent qualifications of a service designation process that requires an independent third-party audit of their performance. They must pass rigorous annual assessments of their network operations center. Technical design and operations staff must also complete advanced training.

6. Where are your network management facilities located, and what are the hours of operation? Describe your escalation process, in the event of an outage.

• Service providers typically have both primary and backup facilities.
• Find out whom to contact when your primary support contact is not available.
  

Depending on your needs, service support during regular business hours may be enough. However, some businesses have requirements for 24-hour operation. Help desk coverage, staffing levels, and backup planning are important aspects to consider in this scenario.

7. What are the assurances for levels of availability, serviceability, performance, and operation? What is the process for remedy if and when levels aren't maintained?

• All service providers establish and maintain benchmark measurements.
• Service contracts detail the metrics, and references have results data.
  

It is now common for service providers to offer service-level agreements (SLAs) as an integral part of a service contract, where the "level of service" is formally defined. The SLA can include the common understanding about services, priorities, responsibilities, and guarantees -- sometimes specifying financial remedies as a result of failure to comply with SLAs.

Next step: The remaining Q&A will be featured in part 3. We'll also provide a link to a complete list, and an ROI calculator to help you start to build a business case.

Transforming Government Through Next Generation Technology

Governments everywhere are struggling with unprecedented challenges. They're expected to reignite a global economy in free-fall, while grappling with crumbling infrastructure, aging populations, declining quality in education and healthcare -- plus a heightened social concern about preserving the environment.

All in a budgetary environment of declining tax revenues.

Like the private sector, governments are now turning to technology to help them to improve both the delivery of government services and to promote overall economic growth.

Building 21st Century Economies
Like the waterways and highways of previous centuries, government leaders recognize they must create essential tech infrastructure to fuel innovation-led growth and prosperity. High-speed broadband is seen as a catalyst for encouraging economic development. However, meaningful services are required to stimulate demand.

For example, Germany has committed €4.6 Billion to install Telepresence capabilities throughout its schools -- to improve the quality of its education system, while reducing costs.

Similar to the access of electricity and the telephone, governments recognize the social equity of providing broadband access to everyone. Thereby using technology to improve the quality of inner-city schools, encourage more telecommuting and increase the productivity of rural economies.

Delivering 21st Century Public Services
There are significant opportunities for progressive governments to:

• Reduce Costs of Delivery – delivering online services, collaboration tools, and video, not only lowers costs to serve but enhances the overall customer experience.
• Empower Citizens – employing Web 2.0 capabilities, such as collaboration and social networking, allows citizens to more easily interact with their government.
• Improve Levels of Service – Kiosks, Telepresence units, or VoIP enabled call centers for 311 calls, raises service levels and the overall experience.
  

Creating 21st Century Governments
Both taxpayers and public servants now recognize that the business of government must evolve, and that technology plays a critical role in this transformation. Likewise, technology providers can choose to partner with governments on this journey.

Research by Cisco IBSG (the company's strategic consulting arm) reveals that the public sector has a number of unique requirements:

• Funding Models – providers must find creative new ways to pay for the new technologies, such as managed services and public-private partnerships.
• Skill Shortages – hiring freezes and lack of skills, means that governments require significant help in design, implementation and management of technology.
• Integrated Solutions – across multiple departments and levels of government, but also with not-for-profits, agencies, multiple partners and other parties.
• Innovation – the private sector can proactively bring new and innovative solutions to legacy problems -- seeding the transformation.
  

Managed Services offers a proven way to help transform government for the 21st Century. However, service providers will need to recognize the unique needs of the public sector and to partner with the champions of progress, to address their most pressing challenges.

About the author: Stuart Taylor is a Director in Cisco IBSG. Stuart leads thought leadership and engagements with key Service Providers in managed services. He has over 15 years of experience focused on strategy, corporate development, business unit strategy, M&A and operational improvement with large mobile and wireline operators and high technology clients.

Non-Profit Gains Budget Relief for Telecom Needs

Non-profit organizations share many of the same communication challenges as other businesses. Their budgetary pressures can also create some unique situations, especially when you consider the scale of their ongoing outreach.

The Greater Illinois Chapter is one of over seventy Alzheimer's Association chapters serving communities across the United States. Currently, the Illinois chapter serves over half a million residents affected by the disease.

They're active in more than 60 counties in Illinois. Since 1980, the non-profit organization has provided information and support, as well as family services, for those affected by the disease. Staying connected to their numerous constituents, and the overall community, is essential.

Streamlining Communication Processes
As the chapter grew, they needed big business telecom functionality -- only on a non-profit budget. In the preparation to move into a new facility, the decision was made to replace their phone system. Managing six office sites, they needed a solution that would lessen the work load on their already strained small technical staff.

After evaluating several options for a voice and data network, the Alzheimer's Association selected Geckotech's SimpleVoIP phone service for its proven ability to deliver a reliable and highly flexible solution.

By utilizing a fully hosted service, the organization has gained additional functionality and operational efficiencies not available with their prior, and less capable, telephone system.

Communication Simplicity, by Design
By connecting all office locations over a common network, employees can use simplified four-digit dialing between locations. This inherent feature of the hosted solution has greatly reduced operating costs, by eliminating the expense of intra-company toll charges.

Geckotech's VoIP phones can be configured for hoteling (shared use), which is especially beneficial for volunteers who work in the office on a flexible schedule. Other features have enhanced ease of use -- such as an Automated Attendant that directs incoming callers to the correct department, call forwarding to mobile phones, and voicemail notification via email.

Resulting benefits from the changeover include a dedicated number and voicemail for the Special Events group, improved routing of incoming calls, free adds/moves/changes and access to a 24x7 technical support team at Geckotech.

Savvy Budgeting in a Tight Economy
These are trying times for non-profit organizations. However, meaningful budget relief -- and improved operational efficiency -- is possible for those organizations that make informed business technology decisions that are based upon a complete financial analysis of the alternatives.

The Alzheimer’s Association recognized a great return on investment with Geckotech's Hosted VoIP Phone service and their IT department has since enjoyed time spent on more pertinent projects, rather than babysitting the phone system.

IT Survival in the Hunt, Kill, Eat Economy

Business Technology related market research used to be targeted primarily at the CIO or IT manager roles within an organization. How times have changed. Research and Markets has added the "Business Technology Trends & Impacts Advisory Service" subscription to their market study offerings.

The service is designed to help all savvy business decision makers develop and implement an effective IT strategy, plus take advantage of the opportunities -- and face the many challenges -- today's rapidly evolving business technology changes will bring.

Developing a Plan of Attack
Clients will receive the usual forecasts and predictions, as well as the strategic implications of those predictions. Subscribers receive advice on practices they can employ now to help organizations succeed within the turbulent economic environment.

The Cutter Business Technology Council is the source of this insight, which includes a team of IT authorities who use a collaborative forecasting approach to provide clients with monthly Council Opinions and present future scenarios for business technology and its many applications.

Monthly council opinions provide a steady flow of predictions, including commentary from each Council Fellow and the logic behind their concurring or dissenting opinion, as well as the strategic implications of the apparent trend.

TelePresence and Other Innovations
Recent opinions have focused on software delivery versus compliance; removing barriers to collaboration through TelePresence; the new IT governance model; IT in the "hunt, kill, eat" economy; systems acquisition and management; timing IT investments, vernacular computing, and more.

Twice-monthly Executive Updates include statistical results of related market research. Cutter's market research focuses on topics such as IT funding, organizational agility, information security, instant messaging, IT litigation, and more.

Weekly Trends E-Mail Advisor alerts subscribers to new technologies, the latest advancements in technology implementation, and new thinking on technology management -- such as managed and hosted services.

The Data Center Metamorphosis
Significant transformations within the realm of the evolving data center, such as the emergence of Unified Computing models, will be an incremental topic included in our ongoing commentary -- right here on the Business Technology Roundtable.

Many forward-looking organizations are eager to develop next-generation data centers that unleash the full power of virtualization. Unified Computing is an architecture that bridges the silos in the data center into a single unified architecture -- using industry standard technologies.

Best MSP Procurement Checklist - part 1

The process of researching, reviewing and selecting a managed or hosted service provider can be a daunting task for those business and technology decision makers that have never performed this task before. Like any other process, there are some best practices.

The following candid questions will help you determine if a provider of managed services can meet and exceed your expectations. Also included are examples of specific details that you should seek.

How do you select a best-fit service provider? Ask all the right questions. Where do you start the selection process? Focus primarily on how the service offered will help to solve problems or create new opportunities -- not merely what it does (its features and functions).

1. Are you prepared to offer only the features and functions that my business needs, instead of the ones that you include in your one-size-fits-all service bundle?

• Ask for a list of all the "standard" items included in the base bundle.
• Request details of all optional items that can be added and/or subtracted.
  

According to recent market research, decision makers at companies of all sizes now prefer that service offerings only include essential features as mandatory elements in a bundle. All other features may then be selected from a menu of options.

2. Can you describe the services that you offer -- and their business benefits -- in terms that I, and the other members of my executive team, will understand?

• The salesperson or sales support person should address your specific needs.
• Ask the service provider to explain any terms that you don't understand.
  

If you can't determine how the managed services will directly benefit your business, then you'll be unable to make an informed decision. Qualified service providers should be able to describe their offerings within the context of your specific business requirements.

3. Will you provide case study materials to demonstrate how you delivered a managed service solution that solved a business challenge similar to mine?

• Documented customer success stories provide useful insight.
• Reference checks should include details on the business impact.
  

While a service provider with limited experience may be able to meet your application needs, those that can clearly articulate the methodology they use to meet their existing customer needs will likely provide a better fit. Moreover, a basic knowledge of how your industry operates will help to avoid misunderstandings.

Note: these are the first three questions from a list of ten. The remaining Q&A will be featured in part 2 and part 3. We'll also provide a link to a complete list that you can download, and a useful ROI calculator to help you build a business case.

Top Six Motivations for Managed Services

What's motivating you to think about managed network services? Is it cost? If so, you'll be surprised to hear that you're somewhat behind the times. A new report cites six top reasons companies turn to managed services, with cost ranking all the way down the list at number four.

According to Warren H. Williams, Vice President and Senior Program Director of IntelliCom Analytics -- a market research firm focusing on managed services, outsourcing, and other technologies -- cost was a big factor several years ago. Today's list of motivations, however, looks like this:

● Improved overall network performance
● Increased network reliability
● Increased network availability
● Reduced operations cost
● Improved network quality of service
● Reduced business risk

Cost Superseded by Convergence
Cost is still important, certainly, but Williams' research over the last three years reveals a growing shift in priorities. "The corporate network has become a strategic resource; the Internet is a vital part of marketing, investor relations, customer satisfaction, and employee access to information," he writes. "Networking complexity and security requirements have increased exponentially."

This equates to nothing less than a multi-threaded convergence. On the one hand, there's the convergence of communications capabilities, such as data, voice, and video. On the other hand, there's the convergence of the network as the platform for a multitude of business processes.

Combating Complexity
Williams envisions these issues coming together "on a single infrastructure, with the objective ... of facilitating communication between man-to-man, man-to-machine, and machine-to-machine regardless of the endpoint." The end result? A flexible infrastructure that can support changing business conditions. Coupled with this capability, however, he says, is an "ever-increasing complexity, increased performance and reliability expectations, and increased costs for skilled personnel and management platforms."

Thus, the shift in motivation from cost reduction to network performance improvement. When considering managed services, then, you should look at the widest set of advantages possible: not just cost reduction, or the avoidance of high-priced personnel, but the advantage that comes from the ability to bring more flexibility and agility to your business.

IP Virtual Private Network Service Options

Service providers offer a variety of options for managed services. The following describes the first of the top three most popular managed services, and the associated options, to help you determine which services would be most useful for your company.

Businesses gain both tactical and strategic advantages when adopting IP Virtual Private Networks (VPN). In the short term, they benefit from cost-effective, secure network connectivity to branch offices and secure access to remote workers, teleworkers, and global partners.

In the long term, they position themselves to take advantage of new value-added, IP-based applications and to support more users and applications at a lower cost.

Choosing a Best-Fit IP VPN Solution
Cisco commissioned the Yankee Group to describe the decision-making process that enterprises used to select one of three broad types of IP VPN managed services (click on image to enlarge).


You can use the decision tree to determine which of the three options for managed IP VPNs is most appropriate for your company:

• Network-based IP VPNs – Service provider provides complete management services.
• Managed CPE-based IP VPNs – Service provider installs and manages the equipment on the customer premises and provides connectivity.
• Do-it-yourself IP VPNs – Business installs and manages the equipment; service provider provides connectivity.

Closing the Business Video Communication Gap

According to Matt Cowall at Appia Communications, if you look around the business video communication landscape today, you'll see two extremes in predominant use within the marketplace.

At one end are TelePresence and other highly sophisticated solutions. These are expensive and largely aimed at the enterprise market, but the quality of the video experience is excellent.

At the other end are PC- and Web-based solutions. These products are inexpensive, but often lack the quality and reliability that business users require.

Mid-Market Video Requirements
Somewhere in the middle, SMBs and similar organizations hope for the best of both extremes -- high video quality and reliability at an affordable price.

But a recent convergence of circumstances and next-generation technologies appears to be closing the gap in both directions, fueled by:

• The soaring costs, hassles, and inefficiencies associated with travel
• The slowing of the economy, which puts a premium on doing more with less
• The focus on reducing carbon emissions
• Internet Protocol (IP) technology, which cuts video transport costs, especially in comparison with traditional ISDN services
• New video compression codecs
• The emergence of Video as a Service (VaaS)

The Rise in Virtual Meetings

Case in point: in survey results released last month by the National Business Travel Association, travel buyers from over 320 U.S. companies reported a 57 percent increase in the use of videoconferencing, and 81 percent of those respondents said that the increase is due to a deliberate replacement of travel with video.

Video communication is on the rise, but how will "the middle" fully adopt and employ it? What mix of products and services will meet the demand? It will be fascinating to find out. Maybe next time, we can discuss it face to face.

Creative Applications for Managed Network Services

Perhaps the restaurant sector doesn't immediately come to mind when you think of creative applications of current business technology. But, that's exactly why it can provide a distinctive competitive advantage for a savvy forward-looking company.

Popeyes quick-service restaurant was founded in 1972 and has expanded to over 1000 franchised locations globally. A Popeyes franchise owner of multiple U.S. east coast locations became interested in using the latest communications technology to reduce his operational costs and streamline back-office functions at each site.

This upgrade included installing a new voice and data network that could manage secure credit card transactions. The decision was made to research a solution to update communication capabilities with a private Internet Protocol (IP) network.

A network using Multi-Protocol Label Switching (MPLS) technology was procured, replacing the cumbersome and outdated analog communication lines. Once the private voice, data, and video network was in place, the next logical step was to determine how to further gain cost advantages by leveraging this advanced infrastructure.

Built on a Solid Foundation
After carefully evaluating several telephone system solutions, the decision was made to use a hosted Voice over IP (VoIP) service from Geckotech, layered over the new backbone network. As a hosted service provider, Geckotech manages an off-premise voice solution that has built-in disaster recovery and very high reliability.

The Popeyes franchises are now able to fully realize the advantages of an outsourced VoIP phone system without having to purchase, maintain, or manage separate phone systems at each location.

All restaurant sites can easily reach each other using simple 4-digit extension dialing. They also benefit from one consolidated monthly telecom bill -- which includes unlimited local and long distance, advanced features like Auto-Attendant, eFax, Conferencing, and Unified Messaging.

Moreover, all of the outdated phone systems were replaced with one advanced VoIP solution, using Cisco Systems hardware end-to-end. As a result, Geckotech enabled the franchise owner to prepare for future business needs, based on a solid communications foundation.

The multiple locations benefit from a built-in disaster recovery plan, which reroutes all calls to a different office location should any site experience a disturbance or natural disaster. The new voice system has reduced overall operational costs by almost 40 percent at each site.

The Power of Strategic Foresight
In reality, there are few enterprises in the 21st century that are inherently low-tech. Every industry has its early-adopters of business technology that assess all the options, survey the competitive landscape, and then take decisive action.

The rewards clearly go to those business leaders who keep and open mind, and willingly embrace change –- especially when it equates to a quantum leap in progress.

Opportunities for Advancement in an Economic Downturn

Can the current economic environment actually create an opportunity? Even though the present financial crisis will adversely affect capital investment, the uncertainties are also creating new demand for the application of certain business technology offerings.

"In particular, ICT solutions that shift costs from a capital to variable component, focus on productivity increases and cost reduction, and support organizational restructuring and acquisitions are likely to see growing demand," says Andrew Milroy, ICT director at Frost & Sullivan.

Four Areas of New Demand
This belief that there will be a strategic increase in IT demand is the result of the consulting company's latest global market study.

While their assessment acknowledges some ICT setbacks, it identifies four key areas that are likely to experience heightened demand -- sustainable IT; outsourcing, managed and hosted services; information management tools; and those services that support mergers and acquisitions.

Sustainability initiatives range from server or storage virtualization and low-energy consumption hardware, through to the use of online collaboration tools, thin client technologies and power consumption modeling. Most of these activities have the dual aim of reducing costs, as well as lowering carbon emissions.

An Increase for Online Collaboration
The anticipated reduction in business travel will create a corresponding increase in demand for conferencing tools. These applications will allow more employees to work remotely, further cutting travel costs and emissions. Secure remote access solutions will therefore experience demand.

The need for cost controls and a desire to minimize risks will place greater focus on variable costs, leading to an increase in demand for software-as-a-service (SaaS) and hosted service models.

Frost & Sullivan's research suggests that the hosted model will be adapted to suit a wider range of services -- including storage and unified communications. New opportunities are expected in many areas of managed services -- such as managed handsets, managed network services and leasing services.

Change Creates Abundant Opportunity
In a summary of their findings, Milroy adds, "We believe that there are opportunities for solutions and services that can help organizations to cut costs, change cost structures, or increase productivity."

The lean times ahead of us will foster the environment where all "business as usual" thinking is challenged -- and, rightfully so. Forward-looking leaders will not falter; they will grasp that potential for new sources of advancement and take the appropriate action.

Perhaps all IT and business decision makers must now ask themselves the ultimate question -- is my organization preparing for a purposeful advance, or an unpredictable decline?

IT Financial Management - Now is the Time

I've heard many excuses, during my years as an ITIL consultant, as to why a client did not want to start IT Financial Management -- the business is not ready, we don't have the tools, we don't know where to start, etc.

However, in these troubling economic times, it is imperative that IT adopts IT Financial Management in order to respond to the increasing pressure to reduce costs.

IT can reduce costs through service-based cost transparency and charge-backs. This method does not mean IT is a profit-center; it just means that IT is educating the business on the cost to provide the services.

With this knowledge, the business can adjust their consumption to better manage their budget and ensure spending is aligned with the value of the service they are receiving. Contrast this with a nebulous IT overhead charge which does not incent the business to use scarce IT resources wisely.

A Roadmap to IT Financial Management
The secret to successfully starting IT Financial Management is to develop a roadmap with increasing levels of maturity.

For example, in Phase 1, pick four to five key services for consumption based costing, e.g. number of servers, storage consumed, network bandwidth consumed, etc., then allocate the remaining costs (i.e. Service Desk, data center operations, etc) as a surcharge against this base price. In Phase 2 and subsequent phases, continue to expand the number of services covered by consumption-based charge-backs.

Another dimension of maturity is the approach to charge-backs. In Phase 1, you may want to just publish costs (i.e. cost transparency with no dollars changing hands). In Phase 2, you may want to provide invoices that show consumption and a hypothetical charge-back amount but stop short of consummating the transaction.

Finally, in Phase 3, implement the actual charge-backs. This gradual approach will allow the business to adapt and prepare for a new way of interacting with IT.

By establishing and communicating a roadmap, you can start IT Financial Management today and be better positioned to manage the IT budget.

About the author: Reg Lo is the VP of Technology Solutions at Third Sky Inc. He has over 14 years of IT consulting experience in ITSM/ITIL consulting, research compliance and healthcare, and custom solutions. He is a frequent speaker at itSMF and HDI events and a contributor to "The Forum", the offical newsletter of itSMF USA.

Globalization and the Small Business Teleworker

The trend of globalization, and the need to connect remote employees, now touches nearly every segment of American business -- regardless of organization size or industry. Here’s a case in point.

Founded in January 2001, Illinois-based Kirix began as a data analysis specialist for the recovery audit industry. They've done a lot of data analysis and software development work in that time and have had a particular specialty in identifying duplicate payments and other overpayment errors in large corporate accounting systems.

More recently, by generalizing their tool set and incorporating Web connectivity into their software, they apply that analytical firepower to all kinds of data -- regardless of where it is located -- even data that's on the Web.

The Borderless Communication Challenge
Benjamin Williams, one of the company founders, had been planning to relocate to Germany. As a valuable asset to their corporation, Kirix wanted to retain his services, but wasn't sure how the international transition might work -- particularly with the potential latency of connecting a Voice over IP (VoIP) phone halfway around the world.

Kirix turned to Geckotech to provide a fully hosted communication solution to enable their corporation to utilize Ben's services overseas, without compromising the quality of their voice and data network.

In this scenario, one feature has proven to be very beneficial -- four-digit extension dialing. This enables simple "internal" calls by dialing the last four digits of a direct-dial number -- even if that employee works in a different country, in another continent.

Unified Communications for the Teleworker
By using Geckotech's outsourced IP phone system, Kirix has been able to retain a key employee while conducting business overseas. The corporation's staff has been pleasantly surprised by the actual quality and reliability of their voice and data network.

"Four-digit dialing to my co-workers from Germany is obviously tremendous, but the quality of service is unbelievable," marvels Mr. Williams. "All that was required was a DSL broadband connection and my Cisco phone and I was making perfectly clear calls to my U.S. office as if I was in the next room over."

As more companies entertain the idea of employing the best talent that's available globally, the demand for the out-tasking of multinational IT and networking services will escalate. It's efficient, it's effective and infinitely more flexible to adapt to the changing communication and collaboration needs of a geographically diverse organization.

Questions to Ask a Managed Service Provider - Part 2

With more and more managed service providers (MSPs) entering the market, your choices are expanding. If you choose the wrong one, however, you might wind up with more challenges than benefits.

How do you know? According to Matt Cowall at Appia Communications, it’s often as simple as asking.

In part one of this post, we covered three of the top five questions to ask a managed service provider: How long has an MSP been in business? What kind of support does the MSP offer? And what kind of redundancy does the MSP offer?

Today we’ll cover the remaining two questions that Matt recommends you ask, and they’re arguably the two most important:

What quality of service does the MSP provide?
This is probably the most important question, of course. You’ll learn quite a bit about an MSP’s service quality when you check its references. Be sure to ask what happens when there are issues. Does the MSP respond quickly and take ownership of the problem?

Another key indicator is the MSP’s service level assurances. A service level agreement (SLA) is a document describing the minimum performance standards an MSP promises to meet. It should also clearly describe remedies — and even penalties — if the MSP ever fails to meet the minimum standards. An SLA is an essential part of a contract between you and an MSP.

Does the MSP have formal SLAs? Do the assurances cover what you’re buying? And do the assurances have ramifications? The willingness of an MSP to offer SLAs with significant penalties for service interruption is a sure sign that the MSP is a high-quality provider. No MSP can remain in business if it has strong SLAs and can’t deliver on its promises.

How willing is the MSP to meet your specific requirements?
Your company or organization is unique; it’s often that very uniqueness that has resulted in your success. Unless an MSP is willing and able to tailor its services to meet your specific requirements, you may find yourself bending your operations to suit the MSP — instead of the other way around.

You can tell a lot about an MSP’s flexibility during the procurement process. Do they ask a few questions and then send you a quote, or do they take the time to listen to your specific needs and develop a custom proposal? And since no MSP can meet every requirement, are they forthcoming about what they are able — and not able — to do, so you can make a fact-based determination of how well their offerings fit your needs?

Lastly, ask about a roadmap for their products or services. Your needs will evolve over time, sometimes quickly. Therefore, your MSP should have a plan that aligns with your future business needs.