situation normal, everything must change
DESCRIPTION
Opening keynote by Simon Wardley at the Eduserv Symposium 2011 - Virtualisation and the Cloud.TRANSCRIPT
Leading Edge Forum March 2011
Situation Normal, Everything Must
Change
Leading Edge Forum March 2011
The LEF focuses on six key interrelated research domains
Organizing IT for the Future
What will the retained central IT function
look like?
4
Business/IT Co-evolution
How are business and IT changing each other?
1
Business/IT Relationship Management
How can Enterprise IT add more value to the
organization?
2
The Consumerization of IT
How are consumer technologies and the Internet affecting both the firm and central IT?
3
The Changing Nature of Work
How will management, employees and the
culture of the firm need to change?
5
Business Sustainability
How can IT be used to help make firms
more environmentally
friendly?
6
Kerching!
DANGER!Will Robinson
DANGER!
Pain
No. Slides
Pain
No. Slides
Pain
OK
20 slides
No. Slides
Pain
OK
Severerisk of harm
344 slides
Cloud Computing?
Note 1: Cloud computing is still an evolving paradigm. Its definitions, use cases, underlying technologies, issues, risks, and benefits will be refined in a spirited debate by the public and private sectors. These definitions, attributes, and characteristics will evolve and change over time.
Note 2: The cloud computing industry represents a large ecosystem of many models, vendors, and market niches. This definition attempts to encompass all of the various cloud approaches.Definition of Cloud Computing:
Cloud computing is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. This cloud model promotes availability and is composed of five essential characteristics, three service models, and four deployment models.
Essential Characteristics:On-demand self-service. A consumer can unilaterally provision computing capabilities, such as server time and network storage, as needed automatically without requiring human interaction with each service’s provider. Broad network access. Capabilities are available over the network and accessed through standard mechanisms that promote use by heterogeneous thin or thick client platforms (e.g., mobile phones, laptops, and PDAs).Resource pooling. The provider’s computing resources are pooled to serve multiple consumers using a multi-tenant model, with different physical and virtual resources dynamically assigned and reassigned according to consumer demand. There is a sense of location independence in that the customer generally has no control or knowledge over the exact location of the provided resources but may be able to specify location at a higher level of abstraction (e.g., country, state, or datacenter). Examples of resources include storage, processing, memory, network bandwidth, and virtual machines.Rapid elasticity. Capabilities can be rapidly and elastically provisioned, in some cases automatically, to quickly scale out and rapidly released to quickly scale in. To the consumer, the capabilities available for provisioning often appear to be unlimited and can be purchased in any quantity at any time.Measured Service. Cloud systems automatically control and optimize resource use by leveraging a metering capability at some level of abstraction appropriate to the type of service (e.g., storage, processing, bandwidth, and active user accounts). Resource usage can be monitored, controlled, and reported providing transparency for both the provider and consumer of the utilized service.
Service Models:Cloud Software as a Service (SaaS). The capability provided to the consumer is to use the provider’s applications running on a cloud infrastructure. The applications are accessible from various client devices through a thin client interface such as a web browser (e.g., web-based email). The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, storage, or even individual application capabilities, with the possible exception of limited user-specific application configuration settings.Cloud Platform as a Service (PaaS). The capability provided to the consumer is to deploy onto the cloud infrastructure consumer-created or acquired applications created using programming languages and tools supported by the provider. The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, or storage, but has control over the deployed applications and possibly application hosting environment configurations.Cloud Infrastructure as a Service (IaaS). The capability provided to the consumer is to provision processing, storage, networks, and other fundamental computing resources where the consumer is able to deploy and run arbitrary software, which can include operating systems and applications. The consumer does not manage or control the underlying cloud infrastructure but has control over operating systems, storage, deployed applications, and possibly limited control of select networking components (e.g., host firewalls).
Deployment Models:Private cloud. The cloud infrastructure is operated solely for an organization. It may be managed by the organization or a third party and may exist on premise or off premise.Community cloud. The cloud infrastructure is shared by several organizations and supports a specific community that has shared concerns (e.g., mission, security requirements, policy, and compliance considerations). It may be managed by the organizations or a third party and may exist on premise or off premise.Public cloud. The cloud infrastructure is made available to the general public or a large industry group and is owned by an organization selling cloud services.Hybrid cloud. The cloud infrastructure is a composition of two or more clouds (private, community, or public) that remain unique entities but are bound together by standardized or proprietary technology that enables data and application portability (e.g., cloud bursting for load-balancing between clouds).Note: Cloud software takes full advantage of the cloud paradigm by being service oriented with a focus on statelessness, low coupling, modularity, and semantic interoperability.
Note 1: Cloud computing is still an evolving paradigm. Its definitions, use cases, underlying technologies, issues, risks, and benefits will be refined in a spirited debate by the public and private sectors. These definitions, attributes, and characteristics will evolve and change over time.
Note 2: The cloud computing industry represents a large ecosystem of many models, vendors, and market niches. This definition attempts to encompass all of the various cloud approaches.Definition of Cloud Computing:
Cloud computing is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. This cloud model promotes availability and is composed of five essential characteristics, three service models, and four deployment models.
Essential Characteristics:On-demand self-service. A consumer can unilaterally provision computing capabilities, such as server time and network storage, as needed automatically without requiring human interaction with each service’s provider. Broad network access. Capabilities are available over the network and accessed through standard mechanisms that promote use by heterogeneous thin or thick client platforms (e.g., mobile phones, laptops, and PDAs).Resource pooling. The provider’s computing resources are pooled to serve multiple consumers using a multi-tenant model, with different physical and virtual resources dynamically assigned and reassigned according to consumer demand. There is a sense of location independence in that the customer generally has no control or knowledge over the exact location of the provided resources but may be able to specify location at a higher level of abstraction (e.g., country, state, or datacenter). Examples of resources include storage, processing, memory, network bandwidth, and virtual machines.Rapid elasticity. Capabilities can be rapidly and elastically provisioned, in some cases automatically, to quickly scale out and rapidly released to quickly scale in. To the consumer, the capabilities available for provisioning often appear to be unlimited and can be purchased in any quantity at any time.Measured Service. Cloud systems automatically control and optimize resource use by leveraging a metering capability at some level of abstraction appropriate to the type of service (e.g., storage, processing, bandwidth, and active user accounts). Resource usage can be monitored, controlled, and reported providing transparency for both the provider and consumer of the utilized service.
Service Models:Cloud Software as a Service (SaaS). The capability provided to the consumer is to use the provider’s applications running on a cloud infrastructure. The applications are accessible from various client devices through a thin client interface such as a web browser (e.g., web-based email). The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, storage, or even individual application capabilities, with the possible exception of limited user-specific application configuration settings.Cloud Platform as a Service (PaaS). The capability provided to the consumer is to deploy onto the cloud infrastructure consumer-created or acquired applications created using programming languages and tools supported by the provider. The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, or storage, but has control over the deployed applications and possibly application hosting environment configurations.Cloud Infrastructure as a Service (IaaS). The capability provided to the consumer is to provision processing, storage, networks, and other fundamental computing resources where the consumer is able to deploy and run arbitrary software, which can include operating systems and applications. The consumer does not manage or control the underlying cloud infrastructure but has control over operating systems, storage, deployed applications, and possibly limited control of select networking components (e.g., host firewalls).
Deployment Models:Private cloud. The cloud infrastructure is operated solely for an organization. It may be managed by the organization or a third party and may exist on premise or off premise.Community cloud. The cloud infrastructure is shared by several organizations and supports a specific community that has shared concerns (e.g., mission, security requirements, policy, and compliance considerations). It may be managed by the organizations or a third party and may exist on premise or off premise.Public cloud. The cloud infrastructure is made available to the general public or a large industry group and is owned by an organization selling cloud services.Hybrid cloud. The cloud infrastructure is a composition of two or more clouds (private, community, or public) that remain unique entities but are bound together by standardized or proprietary technology that enables data and application portability (e.g., cloud bursting for load-balancing between clouds).Note: Cloud software takes full advantage of the cloud paradigm by being service oriented with a focus on statelessness, low coupling, modularity, and semantic interoperability.
Cloud computing is an evolving paradigm.
We don’t know what “cloud” is yet.
“The real thing to do today is to capture, what are the dimensions of the thing that literally, I will tell you, we’re betting our
company on, and I think pretty much everybody in the technology industry is
betting their companies on”Steve Ballmer
We don’t know what “cloud” is yet.
We don’t know what “cloud” is yet.
bet your company on it
We don’t know what “cloud” is yet.
bet your company on it
everybody else is.
“open up exciting new prospects for the
employment of computers in ways and on a scale that would have seemed pure
fantasy only five years ago”
“The challenge of the computer utility” Douglas Parkhill
1966
http://ftp.arl.army.mil/ftp/historic-computers/png/brlescII1.png
online, utility based ...
online, utility based ...
private, public, community & government ...
hardware to applications
private, public, community & government ...
online, utility based ...
Note 1: Cloud computing is still an evolving paradigm. Its definitions, use cases, underlying technologies, issues, risks, and benefits will be refined in a spirited debate by the public and private sectors. These definitions, attributes, and characteristics will evolve and change over time.
Note 2: The cloud computing industry represents a large ecosystem of many models, vendors, and market niches. This definition attempts to encompass all of the various cloud approaches.Definition of Cloud Computing:
Cloud computing is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. This cloud model promotes availability and is composed of five essential characteristics, three service models, and four deployment models.
Essential Characteristics:On-demand self-service. A consumer can unilaterally provision computing capabilities, such as server time and network storage, as needed automatically without requiring human interaction with each service’s provider. Broad network access. Capabilities are available over the network and accessed through standard mechanisms that promote use by heterogeneous thin or thick client platforms (e.g., mobile phones, laptops, and PDAs).Resource pooling. The provider’s computing resources are pooled to serve multiple consumers using a multi-tenant model, with different physical and virtual resources dynamically assigned and reassigned according to consumer demand. There is a sense of location independence in that the customer generally has no control or knowledge over the exact location of the provided resources but may be able to specify location at a higher level of abstraction (e.g., country, state, or datacenter). Examples of resources include storage, processing, memory, network bandwidth, and virtual machines.Rapid elasticity. Capabilities can be rapidly and elastically provisioned, in some cases automatically, to quickly scale out and rapidly released to quickly scale in. To the consumer, the capabilities available for provisioning often appear to be unlimited and can be purchased in any quantity at any time.Measured Service. Cloud systems automatically control and optimize resource use by leveraging a metering capability at some level of abstraction appropriate to the type of service (e.g., storage, processing, bandwidth, and active user accounts). Resource usage can be monitored, controlled, and reported providing transparency for both the provider and consumer of the utilized service.
Service Models:Cloud Software as a Service (SaaS). The capability provided to the consumer is to use the provider’s applications running on a cloud infrastructure. The applications are accessible from various client devices through a thin client interface such as a web browser (e.g., web-based email). The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, storage, or even individual application capabilities, with the possible exception of limited user-specific application configuration settings.Cloud Platform as a Service (PaaS). The capability provided to the consumer is to deploy onto the cloud infrastructure consumer-created or acquired applications created using programming languages and tools supported by the provider. The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, or storage, but has control over the deployed applications and possibly application hosting environment configurations.Cloud Infrastructure as a Service (IaaS). The capability provided to the consumer is to provision processing, storage, networks, and other fundamental computing resources where the consumer is able to deploy and run arbitrary software, which can include operating systems and applications. The consumer does not manage or control the underlying cloud infrastructure but has control over operating systems, storage, deployed applications, and possibly limited control of select networking components (e.g., host firewalls).
Deployment Models:Private cloud. The cloud infrastructure is operated solely for an organization. It may be managed by the organization or a third party and may exist on premise or off premise.Community cloud. The cloud infrastructure is shared by several organizations and supports a specific community that has shared concerns (e.g., mission, security requirements, policy, and compliance considerations). It may be managed by the organizations or a third party and may exist on premise or off premise.Public cloud. The cloud infrastructure is made available to the general public or a large industry group and is owned by an organization selling cloud services.Hybrid cloud. The cloud infrastructure is a composition of two or more clouds (private, community, or public) that remain unique entities but are bound together by standardized or proprietary technology that enables data and application portability (e.g., cloud bursting for load-balancing between clouds).Note: Cloud software takes full advantage of the cloud paradigm by being service oriented with a focus on statelessness, low coupling, modularity, and semantic interoperability.
+44 years
Evolution
EvolutionWhy Now?
Evolution
Benefits & RiskWhy Now?
Ubiquity
Certainty
Ubiquity
Certainty
Ubiquity
Certainty
Ubiquity
InnovationCertainty
Ubiquity
Commodity
Certainty
Ubiquity
Innovation
Innovation of early lists, 1980.
Certainty
Ubiquity
Custom built, DB MarketingMid 80s
Certainty
Ubiquity
ProductEarly 90s
Certainty
Ubiquity
Utility Services of Salesforce
Certainty
Ubiquity
Certainty
Ubiquity
Innovation of Z3, 1941
Certainty
Ubiquity
Custom Built LEO, 1946
Certainty
Ubiquity
Products IBM 650, 1954
Certainty
Ubiquity
Services Tymshare, 1966
Certainty
Ubiquity
Commodity Hardware
Certainty
Ubiquity
Utility Services of Amazon EC2
Certainty
Ubiquity
Innovation of W. H. Wollaston, 1821
Certainty
Ubiquity
Early Products, Hippolyte Pixii, 1830s
Certainty
Ubiquity
Utility Services of the National
Grid
Certainty
Ubiquity
Accounts
Payroll
HR systems
Information market
Enterprise 2.0
InfrastructureCRM
ERP
VRM
Electricity
Search Engines
Web Portal
Certainty
Ubiquity
Product
Custom builtInnovation
Commodity
Certainty
Ubiquity
Product
Custom builtInnovation
Commodity
Utility Services
Services
Certainty
Ubiquity
Commodi
tisatio
n
Certainty
Ubiquity
Demand (user competition)
Certainty
Ubiquity
Improvement (supply competition)
Demand (user competition)
Certainty
Ubiquity
Commodi
tisatio
n
Improvement (supply competition)
Demand (user competition)
Certainty
Ubiquity
Certainty
Ubiquity
Certainty
Ubiquity
Widespread(Demand)
Feature Complete(Improvement)
Certainty
Ubiquity
Utility Services
Database Framework
Operating System
CPU Memory I/O
Messaging
Application
Virtualisation
Database Framework
Operating System
Memory I/O
Messaging
Application
Virtualisation
Database Framework
Operating System
Memory I/O
Messaging
Application
Virtualisation Infrastructure
Database Framework
Operating System
Memory I/O
Messaging
Application
Virtualisation Infrastructure
Platform
Database Framework
Operating System
Memory I/O
Messaging
Application
Virtualisation Infrastructure
Platform
Software
Certainty
Ubiquity
Infrastructure
Platform
Software
... as a Product
Utility Services
“The challenge of the computer utility” Douglas Parkhill
1966
EvolutionWhy now?
Certainty
Ubiquity
Product
Utility Services
Custom built
Certainty
Ubiquity
Product
Custom built
http://www.flickr.com/photos/21734563@N04/2179722280/
Concept
Suitability
Concept
Suitability
TechnologyConcept
Attitude
Concept
Suitability
Technology
Certainty
Ubiquity
Factors
Certainty
Ubiquity
Factors
Concept
Concept
Suitability
Concept
Suitability
Technology
Concept
Suitability
Technology
Attitude
?
P. Strassmann
Certainty
Ubiquity
N. Carr
Certainty
Ubiquity
Diminishing Strategic Value
Certainty
Ubiquity
Competitive Advantage
Certainty
Ubiquity
Cost of Doing Business
Certainty
Ubiquity
Payroll
HR Systems
CRM
ERP
Infrastructure
Finance & Accounting
Sales Automation
Certainty
Ubiquity
PayrollHR
Certainty
Ubiquity
Standardised Service!
Certainty
Ubiquity
Marketplace
Standardised Service!
Concept
Suitability
Technology
Attitude
Certainty
Ubiquity
Factors
Certainty
Ubiquity
BENEFITS vs
RISKS
Factors
Recap ...
Certainty
Ubiquity
Product
Custom builtInnovation
Commodity
Utility Services
Services
Certainty
Ubiquity
Commodi
tisatio
n
Improvement (supply competition)
Demand (user competition)
Certainty
Ubiquity
Infrastructure
Platform
Software
... as a Product
Utility Services
Concept
Suitability
Technology
Attitude
EvolutionWhy now?
Benefits & Risk
Certainty
Ubiquity
Early UtilityWestinghouse,
1890s
Product Hippolyte Pixii,
1830s
Certainty
Ubiquity
Economies of scale(volume operations)
Certainty
Ubiquity
Economies of scale(volume operations)
Focus on core (outsource)
Certainty
Ubiquity
Economies of scale(volume operations)
Focus on core (outsource)
Pay per use (utility)
Certainty
Ubiquity
efficiency
Kerching!
Cloud will reduce your IT spend.
Certainty
Ubiquity
Agility (Self Service)
New server
64 node cluster
Previous Time(mins)
72,000
130,000
New server
64 node cluster
Previous Time(mins)
Cloud Time(mins)
72,000
130,000
7
15
Agility (Self Service)
Certainty
Opportunity
Ubiquity
Agility (Self Service)
Certainty
Opportunity
Ubiquity
Innovation (creative destruction, componentisation)
Joseph A. Schumpeter (1883 - 1950)
The fundamental impulse that sets and keeps the capitalist engine in motion comes from the new consumers, goods, the new methods of production or transportation, the new markets, the new forms of industrial organization that capitalist enterprise creates.
The fundamental impulse that sets and keeps the capitalist engine in motion comes from the new consumers, goods, the new methods of production or transportation, the new markets, the new forms of industrial organization that capitalist enterprise creates.
Joseph A. Schumpeter (1883 - 1950)
newnew
newnew
Joseph A. Schumpeter (1883 - 1950)
Creative Destruction
Erodin
g Valu
e
Certainty
Ubiquity
Erodin
g Valu
e
EnablesInnovation
Certainty
Ubiquity
ElectricityInternet
Certainty
Ubiquity
Hardware
Electricity
Hardware
Internet
Search
Certainty
Ubiquity
EnableInnovation
Theory of Hierarchy Componentisation
Herbert A. Simon (1916 - 2001)
Rate of evolution of a system is
dependant upon the organisation of its subsystems.
Herbert A. Simon (1916 - 2001)
Application
Database Framework Messaging
Application
Database Framework
Operating System
CPU Memory I/O
Messaging
Application
Virtualisation
Database Framework
Operating System
CPU Memory I/O
Messaging
Application
Virtualisation
CPU
Application
Orders of Magnitude
Certainty
Ubiquity
AcceleratedInnovation
Infrastructure
Platform
Software
Henry Maudslay(1771 - 1831)
Agility (Self Service)
Certainty
Opportunity
Ubiquity
Innovation (creative destruction, componentisation)
Certainty
Ubiquity
consumption
Certainty
Ubiquity
efficiency
consumption
William Stanley Jevons, 1865
“Jevons Paradox”
Technological progress that increases the
efficiency with which a resource is used, tends to
increase the rate of consumption of that
resource.
Ray Kurzweil
To the cloud ...
Risks?
Certainty
Ubiquity
Certainty
Ubiquity
RelationshipsSkillsPolitical CapitalInvestment
Disruption
Certainty
Ubiquity
Transition
GovernanceTrustSecurity
Confusion
Transparency
Certainty
Ubiquity
CompetitionLock-inSecond SourceControl
SuitabilityOutsourcing
Certainty
Ubiquity
Marketplace
Standardised Service!
Certainty
Ubiquity
Marketplace
Outsourcing Risks
Many Providers
Open APIs & Data Formats
Semantic Interop.
FacebookOpen Compute
(DC)
NASA & Rackspace OpenStack
(IaaS)
FacebookOpen Compute
(DC)
VMware's Cloud Foundry
(PaaS)
NASA & Rackspace OpenStack
(IaaS)
FacebookOpen Compute
(DC)
Certainty
Ubiquity
Hybrid
Certainty
Ubiquity
Hybrid
Transitional Risks Security of supply, governance, trust ...
Certainty
Ubiquity
Hybrid
CostEconomies of Scale,
Focus ...
Be careful what you're building!
Legacy?
Certainty
Ubiquity
Infrastructure
Certainty
Ubiquity
Scale-Up
Certainty
Ubiquity
Scale-Up N+1 models
Certainty
Ubiquity
Scale-Up N+1 models
Legacy
Need better hardware
Certainty
Ubiquity
Scale-Up N+1 models
Legacy
High CostSpecialised
Certainty
Ubiquity
Certainty
Ubiquity
Scale-Out
Certainty
Ubiquity
Scale-Out
Certainty
Ubiquity
Scale-Out
Design for Failure
Certainty
Ubiquity
Scale-Out
Design for Failure
Cloud
Certainty
Ubiquity
Scale-Out
Design for Failure
Cloud
CommodityLow Cost
Need better software
Certainty
Ubiquity
Scale-Up N+1 models
Legacy
High CostSpecialised
Certainty
Ubiquity
Scale-Up N+1 models
Legacy CommodityLow Cost
The end of cloud is nigh ...
Shouldn't our
architecture evolve as
well?
HereticBurn him!
Fancy a highly resilient
cloud?
Certainty
Ubiquity
Scale-Up N+1 models
Legacy CommodityLow Cost
Certainty
Ubiquity
Scale-Up N+1 models
Legacy
High CostSpecialised
Called "Cloud"
Kerching ...
You have no choice ...
Market
Certainty
Ubiquity
You
Certainty
Ubiquity
Competitive Gap
Speed to marketEconomies of scale
Focus on core
Pay per use
Market
You
Pres
sure
Certainty
Ubiquity
Market
You
“Red Queen Hypothesis”
The need to constantly evolve in order to stand
still relative to a surrounding ecosystem
Prof. Van Valen
Muhahaha
Recap ...
Certainty
Ubiquity
Product
Custom builtInnovation
Commodity
Utility Services
Services
Certainty
Ubiquity
Infrastructure
Platform
Software
... as a Product
Utility Services
Certainty
Ubiquity
Agility (Self Service)
Economies of scale(volume operations)
Focus on core (outsource)
Pay per use (utility) Early Products,
Hippolyte Pixii, 1830s
Utility Services of the National
Grid
Certainty
Ubiquity
RelationshipsSkillsPolitical CapitalInvestment
Disruption
Transition
GovernanceTrustSecurity
Confusion
Transparency
CompetitionLock-inSecond SourceControl
SuitabilityOutsourcing
Certainty
Ubiquity
Hybrid
Transitional Risks Security of supply, governance, trust ...
Pres
sure
Prof. Van Valen “Red Queen Hypothesis”
Certainty
Ubiquity
Market
You
“Jevons Paradox”
Technological progress that increases the efficiency with which a resource is used, tends to increase the rate of consumption
of that resource.
consumption
efficiency
Certainty
Ubiquity
Joseph A. Schumpeter (1883 - 1950)
Herbert A. Simon (1916 - 2001)
+Innovation
creati
ve des
tructi
on
compon
entisa
tion
hang on ...there's more
DANGER!ComplexityDANGER!
Shape
Observations
Shape
Observations
Shape
Pattern
Certainty
Ubiquity
Accounts
Payroll
HR systems
Information market
Enterprise 2.0
InfrastructureCRM
ERP
VRM
Electricity
Search Engines
Web Portal
Certainty
Ubiquity
Accounts
Payroll
HR systems
Information market
Enterprise 2.0
InfrastructureCRM
ERP
VRM
Electricity
Search Engines
Web Portal
Lifecycle
Innovation Custom built Product Commodity
Freq
uenc
y
Innovation Custom built Product Commodity
Freq
uenc
y
Innovation Custom built Product Commodity
Freq
uenc
y
Innovation Custom built Product CommodityInnovation
Freq
uenc
y
Innovation Custom built Product Commodity
Information marketEnterprise 2.0
VRM
Innovation
Freq
uenc
y
Innovation Custom built Product Commodity
Emergent
DeviationDynamic
Uncertain
WorthSerendipity
Innovation
Freq
uenc
y
Innovation Custom built Product Commodity
Chaotic
Innovation
Freq
uenc
y
Innovation Custom built Product CommodityCommodity
Freq
uenc
y
Innovation Custom built Product Commodity
Payroll
HR systems
Infrastructure
CRM
Electricity
Commodity
Freq
uenc
y
Innovation Custom built Product Commodity
Predictable
StandardRepeatable
Known
CODBProcedural
Commodity
Freq
uenc
y
Innovation Custom built Product Commodity
Linear
Commodity
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Linear
Commodity
Chaotic
Innovation
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Transition
Custom built Product
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
CommoditisationCo-Evolution
User & Supply Competition
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Innovate
CommoditisationCo-Evolution
User & Supply Competition
Creative DestructionComponentisation
Who cares?
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
CustomerCentric ‘70s
Siebel SIS ’94
DBM ’80s Salesforce ’02
Lists
What's the best method of
project management?
Use Six Sigma!
Freq
uenc
y
Innovation Custom built Product Commodity
Freq
uenc
y
Innovation Custom built Product Commodity
6 Sigma
Freq
uenc
y
Innovation Custom built Product Commodity
6 Sigma
Reduce Deviation
Commodity
Freq
uenc
y
Innovation Custom built Product Commodity
6 Sigma6 Sigma
Freq
uenc
y
Innovation Custom built Product Commodity
6 Sigma
Reduce Deviation
6 Sigma
Innovation
Use Agile!
Freq
uenc
y
Innovation Custom built Product Commodity
Agile
Encourages Deviation
Innovation
Freq
uenc
y
Innovation Custom built Product Commodity
Agile
Commodity
Freq
uenc
y
Innovation Custom built Product Commodity
Agile
Encourages Deviation
Commodity
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
No Magic Bullet
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Survival Tomorrow
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Survival Today
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Survival Tomorrow
Survival Today
VS
Survival today requires ‘coherence, coordination and stability’.
Survival tomorrow requires the replacement of these erstwhile virtues.
Salaman & Storey
Innovation Paradox
http://www.flickr.com/photos/rednuht/479370088
Innovation Custom built Product Commodity
Freq
uenc
y
Innovation Custom built Product Commodity
Freq
uenc
y
Freq
uenc
y
Innovation Custom built Product Commodity
Emergent
DeviationDynamic
Uncertain
WorthSerendipity
Innovation Custom built Product Commodity
Emergent
DeviationDynamic
Uncertain
WorthSerendipity
NetworkedFreq
uenc
y
Innovation Custom built Product Commodity
NetworkedFr
eque
ncy
Innovation Custom built Product Commodity
NetworkedFr
eque
ncy
Freq
uenc
y
Innovation Custom built Product Commodity
Hierarchical
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
1. One size fits all
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
1. One size fits all
2. But it worked for them?
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
1. One size fits all.
3. Outsourcing failures.
2. But it worked for them?
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
1. One size fits all
3. Outsourcing failures.
4. Business Alignment.
2. But it worked for them?
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
3. Outsourcing failures.
4. Business Alignment.
5. Innovation vs Efficiency.
1. One size fits all
2. But it worked for them?
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
3. Outsourcing failures.
4. Business Alignment.
5. Innovation vs Efficiency.
6. Management Yo-Yo's.
1. One size fits all
2. But it worked for them?
We suck Same here
Observations
Shape
Pattern
Certainty
Ubiquity
Joseph A. Schumpeter (1883 - 1950)
Herbert A. Simon (1916 - 2001)
+Innovation
creati
ve des
tructi
on
compon
entisa
tion
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
CommoditiseUndifferentiated
to Utility Services
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
CommoditiseUndifferentiated
to Utility ServicesInnovateComponentisation
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
CommoditiseUndifferentiated
to Utility Services
Componentisation
Worth∝Certainty1
Innovate
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
CommoditiseUndifferentiated
to Utility Services
Componentisation
Adoption
Innovate
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
LeverageEcosystem (Size)
Componentisation
Undifferentiatedto Utility ServicesInnovate
Commoditise
Freq
uenc
y
Innovation Custom built Product Commodity
Utility services
Ecosystem
Innovation
Identify future patterns
Next Wave
InnovateLeverage
Commoditise
EC2, S3, SQS ...
Hadoop
Amazon
Copy
20% Work
Google Labs
APIs
Summer of Code
Acquisition
App Exchange
APIs & Platform
Salesforce
CRM Ideas
Acquisition
New models of Management
Summary
Certainty
Ubiquity
Product
Custom builtInnovation
Commodity
Utility Services
Services
Certainty
Ubiquity
Infrastructure
Platform
Software
... as a Product
Utility Services
Certainty
Ubiquity
Agility (Self Service)
Economies of scale(volume operations)
Focus on core (outsource)
Pay per use (utility) Early Products,
Hippolyte Pixii, 1830s
Utility Services of the National
Grid
Certainty
Ubiquity
RelationshipsSkillsPolitical CapitalInvestment
Disruption
Transition
GovernanceTrustSecurity
Confusion
Transparency
CompetitionLock-inSecond SourceControl
SuitabilityOutsourcing
Pres
sure
Prof. Van Valen “Red Queen Hypothesis”
Certainty
Ubiquity
Market
You
hang on ...there's more
Certainty
Ubiquity
Accounts
Payroll
HR systems
Information market
Enterprise 2.0
InfrastructureCRM
ERP
VRM
Electricity
Search Engines
Web Portal
Freq
uenc
y
Innovation Custom built Product Commodity
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Innovate
CommoditisationCo-Evolution
User & Supply Competition
Creative DestructionComponentisation
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
CustomerCentric ‘70s
Siebel SIS ’94
DBM ’80s Salesforce ’02
Lists
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
LinearTransitionChaotic
Freq
uenc
y
Innovation Custom built Product Commodity
6 Sigma
Reduce Deviation
6 Sigma
Innovation
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Survival Tomorrow
Survival Today
VS
InnovateLeverage
Commoditise
I work for Government, we
don't compete with anyone.
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
A
B
Product
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
A
B
Product
Sometimes disruptive
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Cable
Hydraulic
Excavation
Product
Sometimes disruptive
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product CommodityProduct Commodity
Utility Service
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product CommodityProduct Commodity
Utility Service
Always disruptive
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product CommodityProduct Commodity
Vendor
Revenue
Always disruptiveUtility Service
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product CommodityProduct Commodity
Vendor
Revenue
Always disruptiveUtility Service
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product CommodityProduct Commodity
Vendor
Revenue
Always disruptiveUtility Service
Amazon
"Success is a lousy teacher. It makes you think you know what
you're doing."Bill Gates
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Feature
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Feature
Proprietary
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product CommodityCommodity
ServiceFeature
Proprietary
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product CommodityCommodity
ServiceFeature
OpenProprietary
To COMPETE I lose my high profit revenue stream and give away my code?
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Mass Communication
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Mass Communication
Printing
Distribution
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Mass Communication
Printing
Distribution Barriers to Entry
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Mass Communication
Digitsation
Internet
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Infrastructure
Platform
Software
Do more, faster
Product Commodity
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Infrastructure
Platform
Software
Innovate
Do more, faster
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
InnovateDisruptive
Infrastructure
Platform
Software
Do more, faster
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Innovate
Barriers
Disruptive
Infrastructure
Platform
Software
Do more, faster
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Innovate
Barriers
Disruptive
New Management
Infrastructure
Platform
Software
Do more, faster
Freq
uenc
y Fr
eque
ncy
Innovation Custom built Product Commodity
Innovate
Barriers
Disruptive
New Management
Infrastructure
Platform
Software
Do more, faster$7.5 Bn
€763 billion of cumulative economic
benefits over the period 2010 to 2015
CEBR, Cloud Dividend, Dec'10
"We don't want the next Intel or Google to be
created in China or India" President Obama
I work for Government, we
don't compete with anyone.
That's cheating
Freq
uenc
y
Lifecycle
Innovation Custom built Product Commodity
Chaotic LinearTransition
Changing Tactics ...
Camera
CalculatorPortable music player
Address book
GISHealth Monitor
ID CardSocial Network
Radio
Social Gaming
Time keeper
Phone
Freq
uenc
y
Lifecycle
Innovation Custom built Product Commodity
Chaotic LinearTransition
Changing Tactics ...
Camera
CalculatorPortable music player
Address book
GISHealth Monitor
ID CardSocial Network
Radio
Social Gaming
Time keeper
Phone
Freq
uenc
y
Lifecycle
Innovation Custom built Product Commodity
Chaotic LinearTransition
Changing Tactics ...
Certainty
Future Worth∝ 1
Freq
uenc
y
Lifecycle
Innovation Custom built Product Commodity
Chaotic LinearTransition
Changing Tactics ...
CRM
Freq
uenc
y
Lifecycle
Innovation Custom built Product Commodity
Chaotic LinearTransition
Changing Tactics ...
Revenue Streams
CRM
Freq
uenc
y
Lifecycle
Innovation Custom built Product Commodity
Chaotic LinearTransition
Infrastructure
Changing Tactics ...
Barriers to Entry
Revenue Streams
Freq
uenc
y
Lifecycle
Innovation Custom built Product Commodity
Chaotic LinearTransition
Changing Tactics ...
Barriers to Entry
Revenue Streams
Freq
uenc
y
Lifecycle
Innovation Custom built Product Commodity
Chaotic LinearTransition
Platform
Changing Tactics ...
Barriers to Entry
Revenue Streams
Freq
uenc
y
Lifecycle
Innovation Custom built Product Commodity
Chaotic LinearTransition
Social CRM
Changing Tactics ...
Barriers to Entry
Revenue Streams
Differential
Competitors
Freq
uenc
y
Lifecycle
Innovation Custom built Product Commodity
Chaotic LinearTransition
Social CRM
Changing Tactics ...
Barriers to Entry
Revenue Streams
Differential
Freq
uenc
y
Lifecycle
Innovation Custom built Product Commodity
Chaotic LinearTransition
Social CRM
Collaboration
"Moat"
Tower
Mobile
Changing Tactics ...
Barriers to Entry
Revenue Streams
Differential
Freq
uenc
y
Lifecycle
Innovation Custom built Product Commodity
Chaotic LinearTransition
"Moat"
Changing Tactics ...
Barriers to Entry
Revenue Streams
TowerCompetitors
Differential
Ooops, bugger.
Freq
uenc
y
Lifecycle
Innovation Custom built Product Commodity
Chaotic LinearTransition
Changing Tactics ...
Barriers to Entry
Revenue Streams
Competitors
DifferentialOpen Source
Freq
uenc
y
Lifecycle
Innovation Custom built Product Commodity
Chaotic LinearTransition
Changing Tactics ...
Barriers to Entry
Revenue Streams
Competitors
DifferentialOpen Source
Inertia
To SURVIVE I need to lose my high profit revenue stream
and give away my code?
Note 1: Cloud computing is still an evolving paradigm. Its definitions, use cases, underlying technologies, issues, risks, and benefits will be refined in a spirited debate by the public and private sectors. These definitions, attributes, and characteristics will evolve and change over time.
Note 2: The cloud computing industry represents a large ecosystem of many models, vendors, and market niches. This definition attempts to encompass all of the various cloud approaches.Definition of Cloud Computing:
Cloud computing is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. This cloud model promotes availability and is composed of five essential characteristics, three service models, and four deployment models.
Essential Characteristics:On-demand self-service. A consumer can unilaterally provision computing capabilities, such as server time and network storage, as needed automatically without requiring human interaction with each service’s provider. Broad network access. Capabilities are available over the network and accessed through standard mechanisms that promote use by heterogeneous thin or thick client platforms (e.g., mobile phones, laptops, and PDAs).Resource pooling. The provider’s computing resources are pooled to serve multiple consumers using a multi-tenant model, with different physical and virtual resources dynamically assigned and reassigned according to consumer demand. There is a sense of location independence in that the customer generally has no control or knowledge over the exact location of the provided resources but may be able to specify location at a higher level of abstraction (e.g., country, state, or datacenter). Examples of resources include storage, processing, memory, network bandwidth, and virtual machines.Rapid elasticity. Capabilities can be rapidly and elastically provisioned, in some cases automatically, to quickly scale out and rapidly released to quickly scale in. To the consumer, the capabilities available for provisioning often appear to be unlimited and can be purchased in any quantity at any time.Measured Service. Cloud systems automatically control and optimize resource use by leveraging a metering capability at some level of abstraction appropriate to the type of service (e.g., storage, processing, bandwidth, and active user accounts). Resource usage can be monitored, controlled, and reported providing transparency for both the provider and consumer of the utilized service.
Service Models:Cloud Software as a Service (SaaS). The capability provided to the consumer is to use the provider’s applications running on a cloud infrastructure. The applications are accessible from various client devices through a thin client interface such as a web browser (e.g., web-based email). The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, storage, or even individual application capabilities, with the possible exception of limited user-specific application configuration settings.Cloud Platform as a Service (PaaS). The capability provided to the consumer is to deploy onto the cloud infrastructure consumer-created or acquired applications created using programming languages and tools supported by the provider. The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, or storage, but has control over the deployed applications and possibly application hosting environment configurations.Cloud Infrastructure as a Service (IaaS). The capability provided to the consumer is to provision processing, storage, networks, and other fundamental computing resources where the consumer is able to deploy and run arbitrary software, which can include operating systems and applications. The consumer does not manage or control the underlying cloud infrastructure but has control over operating systems, storage, deployed applications, and possibly limited control of select networking components (e.g., host firewalls).
Deployment Models:Private cloud. The cloud infrastructure is operated solely for an organization. It may be managed by the organization or a third party and may exist on premise or off premise.Community cloud. The cloud infrastructure is shared by several organizations and supports a specific community that has shared concerns (e.g., mission, security requirements, policy, and compliance considerations). It may be managed by the organizations or a third party and may exist on premise or off premise.Public cloud. The cloud infrastructure is made available to the general public or a large industry group and is owned by an organization selling cloud services.Hybrid cloud. The cloud infrastructure is a composition of two or more clouds (private, community, or public) that remain unique entities but are bound together by standardized or proprietary technology that enables data and application portability (e.g., cloud bursting for load-balancing between clouds).Note: Cloud software takes full advantage of the cloud paradigm by being service oriented with a focus on statelessness, low coupling, modularity, and semantic interoperability.
Cloud computing is an evolving paradigm.
Technology
Gotcha!
Leading Edge Forum March 2011
The LEF focuses on six key interrelated research domains
Organizing IT for the Future
What will the retained central IT function
look like?
4
Business/IT Co-evolution
How are business and IT changing each other?
1
Business/IT Relationship Management
How can Enterprise IT add more value to the
organization?
2
The Consumerization of IT
How are consumer technologies and the Internet affecting both the firm and central IT?
3
The Changing Nature of Work
How will management, employees and the
culture of the firm need to change?
5
Business Sustainability
How can IT be used to help make firms
more environmentally
friendly?
6
Leading Edge Forum March 2011
@swardley