Sanjeev Aggarwal's Blog

January 30, 2009

SMB/Mid-Market Key IT Initiatives in the Current Market Environment

Filed under: Cloud Computing, Managed Services, Mobility, Security, Storage — Tags: , — sanjeevaggarwal @ 4:23 pm

Recently (December’08), I had the opportunity to participate in a CFO/CIO panel with participants from New England SMB/mid-market businesses, organized by Managed Technology Partners. The topic of the panel discussion was ‘What key IT initiatives that are still being considered and issues to be considered in the decision-making processes’. Looking at the current turbulent economic conditions, SMBs and mid-market enterprises are under tremendous pressures. Most of them have never experienced these types of market conditions before. Given that, most of the panel members and attendees had a very positive attitude.

The discussion centered on not only the key IT initiatives in the current market environment but also some of the key consideration that need to be taken into account in the decision process.

Decision making process needs to take into account some key considerations:

  • Cost containment – the need to preserve cash, decisions need to consider whether an initiative will save money or make money or both
  • Focus on short-term ROI – The projects need to show short term ROI and support the cost containment focus, shift model to monthly operating expenses, without a significant upfront investment
  • Existing investment – Review existing system utilization and put together plans for getting the most out of them. This includes considering options like costs for running/managing/upgrading existing systems, virtualization to improve utilization, alternate solutions provide that could meet the cost savings focus, etc.
  • Right-sizing – wanting to be sure right technology solutions are selected that match the business’ needs including longer-term viability
  • Existing IT resources – Expertise, utilization and availability to adequately support business needs

The key IT initiatives that made it to the top of the list are:

  • The continued need for security (data and access) and business continuity solutions – this is especially important in the current environment as studies have shown that human error or intentional tampering are the leading cause of data loss.
  • Providing remote access for users as the percentage of remote/Teleworkers increases
  • Backup and recovery that is right for “my” business – the “availability” of data is critical
  • Access (or lack of) to expertise and alignment of IT with the business
  • Determining the right support models – that reduces costs and maintains up-time
  • Vendor and VAR viability as part of the decision-making process

There was also conversation around the need for a strategic focus on IT and planning to ensure IT meet the business needs, both short and longer term.  Also, to ensure technology decisions are part of a larger discussion that provides for better prioritization, opportunities for economies of scale, making sure decisions are not make in silos, and the financial impact as it relates to other initiatives and objectives.

We are in a period of unprecedented changes to the business climate that will challenge both vendors and solutions providers in ways never seen experienced in the past. To be successful, vendors and solution providers need to take a focused approach with solutions and messaging that address the above considerations and issue.

January 27, 2009

Cloud Computing and Services – Can this provide the market disruption in the current economic environment!

Cloud computing and services include any subscription-based service that is delivered over the internet in real time, providing flexibility by extending an enterprises internal IT resources, staff and expertise. It encompasses several of the web-based solutions/services listed below.

  • Infrastructure-as-a-Service:
    • A way to add computing, storage and bandwidth capabilities in real-time without investing in additional in-house IT infrastructure or support personnel
    • The customer has no incremental investment in servers, storage, support and management people and expenses.
    • Solutions for server, storage, security, high availability/disaster recovery, web content  delivery
    • Key Examples:  Amazon, IBM, AT&T
  • Software-as-a-Service (SaaS):
    • The application developer delivers the application supporting a multitenant architecture over the internet that is accessed using a web browser.   Includes application platform and ISV applications developed  using  that platform.
    • The customer has no  incremental upfront  investment in server or software  licenses for these applications.
    • Solutions for business, collaboration, productivity applications
    • Key Examples:  Netsuite, Salesforce.com, Google, Cisco/WebEx, CitrixOnLine, Microsoft.
  • Managed Services (MSP):
    • Provide outsourcing or out-tasking of specific application, network, and systems management functions. Management can mean simply monitoring, or it can include management and performance monitoring of the application, system tuning, corrective actions for systems on customer’s premises.
    • This service is delivered remotely over the network from the Service Provider or VARs data center, some MSPs provide onsite management/support as required.
    • The customer has reduced need for IT expertise and support.
    • Solutions for security, data backup, remote server/ desktop/network management, desktop virtualization.
    • Key Examples: Iron Mountain, EMC, Symantec, AT&T, SunGard, HP, IBM, Verisign
  • Hosted Services (HSP):
    • Hosted Services provider host, service, and  update the infrastructure systems and/or applications software at their data center. These systems/software is owned and managed by the service provider, and are either dedicated or shared (multitenet).
    • The value-added services/ applications are delivered remotely over the network from the service provider or VARs data center to the end-user.
    • The customer has no incremental upfront  investment in server, storage, and support people (maybe for software licenses) for these services.
    • Solutions for business, database, e-commerce, productivity, communication applications
    • Key Examples: Savvis, Rackspace, Navisite, Sungard, AT&T.
  •  Cloud architectures have the ability to scale to meet customer demand and traffic spikes in real time. Businesses don’t have to constantly re-engineer their environment and add systems to handle peak loads. Businesses don’t have to wrestle with the underlying infrastructure and core technologies or the day-to-day operational, performance and scalability issues of their IT infrastructure. Instead, they can focus their resources on the core business functions.

    The primary target market and consumers for the various segments of the external cloud computing services are SMBs, mid-market enterprises and departments of large enterprises. In addition to the cloud services vendors, the VAR channel and Service Providers (network) will play a few role in the cloud computing ecosystem. What is the short-term prognosis for these services? The SMB and mid-market businesses are under severe pressures in the current recessionary economic climate. They are considering all option that help them control costs (both systems and people resources) to get through the current economic conditions and credit crunch. They are open to new and innovative ideas.

    Will these market conditions provide the disruption that the cloud initiatives need to drive demand and market uptake?

     

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