the d+m group - cio summits by cdm media...the d+m group cio cloud summit 2013 ... d+m strategic...

John Jackson

VP, Global Infrastructure & Vendor

Management

THE D+M GROUP CIO Cloud Summit 2013

Introduction and Business Overview

Determining if a cloud strategy is right for

your organization

How to evaluate the economics of the

cloud

Staffing your organization with the right

skills to make the cloud a success

2

AGENDA

3 I PERFORMANCE IS EVERYTHING

COMPANY OVERVIEW

Acquired by Bain Capital in 2008

$1B diversified global audio company serving the consumer,

professional and automotive markets

Collection of premium, industry leading audio brands with

tremendous market history and loyal customer base

» Denon – founded in 1910

» Marantz – 1953

Sales in more than 60 countries with revenue evenly split

between North America, Europe and Asia Pacific

~2,300 employees with over 300 software and development

engineers across eight design centers

» Boston Acoustic - 1979 » Allen & Heath – 1969 » Calrec – 1964

4 I PERFORMANCE IS EVERYTHING

D+M STRATEGIC BUSINESS UNITS(SBUS)

C O N S U M E R P RO F E S S I O N A L O E M

~60% of sales ~15% of sales ~25% of sales

5 I PERFORMANCE IS EVERYTHING

GLOBAL CUSTOMER PARTNERSHIPS

North America Europe Asia Pacific Segment

AV Specialty

Big Box

Internet

New

Channels

Warehouse Clubs

Sporting goods

Airport Retail

Luxury apparel retail

Luggage shops

6 I PERFORMANCE IS EVERYTHING

Decision on what is strategic and what is tactical

Do you have the right team to support a cloud model?

Forbes Magazine Article:

“A strong partnership between IT and business units,

operational agility, and a knack for modeling new

technologies to fit unique business needs are critical

in order to make the most of cloud computing.”

Understand your security needs

Does the cost benefit justify the disruption?

IS YOUR COMPANY READY FOR THE CLOUD?

7 I PERFORMANCE IS EVERYTHING

STRATEGY

Responsibilities IT Responsibilities center on creating and operating

technology

IT responsibilities center on creating productivity and

capabilities in support of strategy

Management

Challenge

Managing internal resources to create, install and

manage systems internally

Concentrating internal resources on realizing value in a multi-

sourced environment

Technology Technology is owned, operated, budgeted within the

enterprise

Technology is networked across a range of enterprise, partners

and the cloud

Organization IT organization is a pyramid of functional skills who are

enterprise employees

IT organization leveraging business and technical skills along

with sourced partners

Performance

Metrics

IT Success is measured based on creation, provisioning

and operating technology

IT success is measured against changes in business performance

Lightweight

Technologies

Level 1:

Driving Innovation

Level 2:

Delivering Solutions

Level 3:

Managing

Service and

Sourcing

Relationships CURRENT STATE FUTURE STATE

A: Governance

B: Project Management

C: Architecture & Design

8 I PERFORMANCE IS EVERYTHING

ROI FRAMEWORK

On-Premise Cloud Based

Unit Quantity Per Unit Total Unit Quantity Per Unit Total

CAPEX (Initial) 4,428,130$ 157,500$

Server NoS 100 8,000$ 800,000$ NoS 0 -$ -$

Networking Equipment NoS 50 1,000$ 50,000$ NoS 0 -$ -$

Storage TB 50 3,500$ 175,000$ TB 0 -$ -$

Storage Backup TB 350 1,000$ 350,000$ TB 0 -$ -$

Software (OS + IIS) NoS 100 3,999$ 399,900$ NoS 0 -$ -$

Software (DB) NoS 100 24,999$ 2,499,900$ NoS 0 -$

Software (AV + Mgmt) NoS 100 200$ 20,000$ NoS 0 -$ -$

Labor $/resource/month 10 13,333$ 133,330$ $/resource/month 9 17,500$ 157,500$

Real Estate $/sqft 0 1,000$ -$ $/sqft 0 -$ -$

OPEX (Annual) 1,985,717$ 1,479,950$

Computing Power $/hr 0 -$ -$ $/hr 3504000 0.125$ 438,000$

Storage TB 0 3,500$ -$ $/GB 1533000 0.15$ 229,950$

Bandwidth $/per site 3 30,000$ 90,000$ $/GB 600000 0.22$ 132,000$

Headcount resources/yr 8 160,000$ 1,280,000$ resources/yr 3 160,000$ 480,000$

Infrastructure Maintenance % of total cost 15 7,250$ 108,750$ % of total cost 0 -$ -$

Software Maintenance % of total cost 33 3,999$ 131,967$ % of total cost 0 -$ -$

Power $/yr/dc 1 120,000$ 120,000$ $/month 0 -$ -$

Space $/sqft/month 1000 135$ 135,000$ $/sqft/month 0 -$ -$

Other Maintenance $/yr 3 40,000$ 120,000$ $/yr 0 -$ -$

Pay-per-Use Savings (-) 0 -$ 25 8,000$ 200,000$

Total 6,413,847$ 1,637,450$

Savings 4,776,397$

9 I PERFORMANCE IS EVERYTHING

WHERE WE STARTED

Challenges • High Cost Structure

• Lack of cash to invest in new infrastructure

• Slow to respond to business needs

• Lack of Support

• Lack of talent/resources

• Language Constraints

Opportunities • Significantly reduce our cost structure

• Shift from CAPEX to OPEX model

• Create flexibility to support changing

business needs

• Add 24 X 7 Monitoring and Support

10 I PERFORMANCE IS EVERYTHING

OUR CLOUD PARTNERS

11 I PERFORMANCE IS EVERYTHING

WHERE WE ARE

Results • 90% of our IT spend is Cloud

• Completely transparent cost allocations

• Days to deploy new applications

• Built smaller, higher performance team

• Contributed 26% in IS cost reductions

which improved EBITDA by 6%

• Benefit from additional functionality with no

additional cost

• Shifted from CAPEX to OPEX model

• Created agility to support business

requirements

12 I PERFORMANCE IS EVERYTHING

DIFFERENT TYPES OF CLOUDS

» Boston Acoustic - 1979 » Allen & Heath – 1969 » Calrec – 1964

Google Apps, Salesforce.com, Netsuite,

Box, Microsoft Office 365, Bluejeans,

RightNow, etc…

Google App Engine, Force.com,

Windows Azure, LongJump, Rollbase,

Amazon Elastic Beanstalk, etc…

Amazon, EC2, Rackspace, Savvis,

Terremark, Vmware, Joyent, Datapipe,

etc...

IaaS

PaaS

SaaS

13 I PERFORMANCE IS EVERYTHING

CLOUD BENEFITS

Commodity Pricing

Capacity Bursting

Accelerated Virtualization

Deployment

Optimized Resource

Utilization

Improved Operational

Efficiency

Resource Pooling

Hardware Consolidation

VIRTUALIZATION PRIVATE CLOUD PUBLIC CLOUD

RO

I B

EN

EFIT

S

Questions?

15 I PERFORMANCE IS EVERYTHING

APPENDIX

16 I PERFORMANCE IS EVERYTHING

Growth of Internet-based digital content

Younger generation of music lovers

Growth of portable devices

Internet sales

Mature core markets

WHY NOW? OUR WORLD IS CHANGING

17 I PERFORMANCE IS EVERYTHING

S T A R T W I T H T H E C U S T O M E R

Innovation & Expansion

NEW WIRELESS MUSIC SYSTEM

18 I PERFORMANCE IS EVERYTHING

Innovation & Expansion

WIRELESS MUSIC SYSTEM

19 I PERFORMANCE IS EVERYTHING

ULTRA-THIN & WIRELESS

ACOUSTICALLY PURE

WIRELESS & COMFORTABLE HEAVY BASS

The ultimate weapon in your travel arsenal.

It’s like hearing your favorite song for the

first time.

To help you achieve your

maximum performance.

Delivering a bone-jarring, brutally-powerful bass

experience.

Innovation & Expansion

NEW HEADPHONE PRODUCT LINE

20 I PERFORMANCE IS EVERYTHING

GLOBAL PUBLIC RELATIONS

expanding our brand exposure into lifestyle media publications

21 I PERFORMANCE IS EVERYTHING

ADVERTISING CAMPAIGN - EUROPE

distinct advertising which is true to the brand character

22 I PERFORMANCE IS EVERYTHING

SOCIAL MEDIA

connecting with our fans around the world

23 I PERFORMANCE IS EVERYTHING

LOCAL MARKETING ACTIVITIES

547 MILLION People pass

through Times Square per

year

10 MILLION Viewers see live

shots of times square daily

that are nationally televised

Delivering a consistent brand message, but tailored to local market needs

Times Square in NYC

Truck billboard with the inside

transformed to a living room for the

customers’ listening enjoyment

Singapore

24 I PERFORMANCE IS EVERYTHING

PARTNERSHIPS

Leveraging partnerships to connect with a younger target market

At 35M unique visitors per month MySpace is

larger than both Pandora and Spotify

combined

Advertising featured on myspace.com

Exclusive events in LA, San Francisco and

New York

Social media tie in

Website and Radio spots during the holiday

season will generate over 12M impressions

Official headphone sponsor of the iHeart

Radio Music Festival

Tie in to iHeart’s 5M Facebook fans

VIP bag placement