CIO MARCH 2013 VOLUME 20 CLOUD SLAS: A NECESSARY INGREDIENT MAKING THE BUSINESS ARCHITECTURE TRANSFORMATION BUSINESS SOLUTIONS ARCHITECTS WHO MAKE THE GRADE CLOUD COMPUTING: CANDY MINT OR BREATH MINT? CLOUD’S GETTING CIRRUS Inside: Cloud à la Carte As cloud computing expands, CIOs are picking from a vast menu of cloud options to fit their organization’s needs. decisions GUIDING TECHNOLOGY DECISION MAKERS IN THE ENTERPRISE WHERE VDI SAVES LIVES COACH BAGS SALES THANKS TO CLIENT ANALYSIS
WE MAY NEVER get to the point where the cloud is the be all and end all of enterprise computing, but that doesn’t mean we shouldn’t try.
CIOs on the cutting edge aren’t waiting around for someone to say, “The cloud is ready for the enterprise” the way IT pros used to wait with bated breath for someone to declare Linux ready. I kid: The cloud and cloud services have already come of age, and they did so when CIOs like Larry Bolick and Laura Patterson and every other farsight-ed company starting redefining their organization’s goals and using the cloud as a means to reach those goals.
In this issue of CIO Decisions, you will read about some of those decisions and how they got there. Bolick, CIO at Aquent LLC, has been ahead of the curve since 2010. As he told SearchCIO.com features writer Karen Goulart, “When we first started, it was all about getting servers up quickly and that sort of thing. Now we’re seeing business intelligence services and there’s data warehousing on the horizon.”
University of Michigan CIO Laura Patterson would never build another physical data center at her school if she had her way, Goulart writes. The school is in the midst of a five-year transformation project that is being built around the cloud. “The cloud model is a significant
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EDITOR'S LETTER
Scot PetersenEditorial Director
paradigm shift; it’s not just a different way of sourcing,” she said. “Because of that, I think early adoption to the cloud is a competitive advantage.”
Patterson echoes the point that CIO Outlook columnist Harvey Koeppel makes: Cloud should not be thought of as an add-on technology option but rather the very essence of your business. Amid the literally dozens of cloud defini-tions and types out there, how about a new one, which he coins the “Business Value Cloud”?
What we call cloud computing “is inconsequential com-pared to what we do with it,” he writes. “Is this dynamic really much different than how we deal with any other technologies? Do our internal and external customers, shareholders and stakeholders care about what we call it? I think not. Do they care about how we create sustainable business value and drive growth in increasingly complex, volatile and competitive markets? Of course they do.”
So, let’s forget about cloud types as defined by vendors and get busy just making the cloud work for your business, and your business for the cloud. Oh, and don’t forget your SLAs.•Please write to Scot [email protected].
CHANGING THE IT tools of a trade can be traumatic for us-ers—especially in a workplace where lives depend on the technology. But that wasn’t the case for Wes Wright, CIO and senior vice president at Seattle Children’s Hospital. Once his customers—dozens of doctors, nurses, clinicians and administrators—began reaping the benefits of a vir-tual desktop infrastructure, they couldn’t imagine working without it.
First there was the speed: A desktop login took 43 seconds, and a reconnect took 15 seconds. Then there was the agility: a personal desktop everywhere users needed one to be, when they needed it. Soon after the first 200 virtual desktop infrastructure (VDI) devices started rolling out at the hospital’s Bellevue Surgery Center, clinicians began clamoring for them in the emergency department. Today, there are about 3,900 devices in use, with the last major deployment taking place soon in the intensive care unit.
“It’s funny: Now I watch people in one of our common areas walk right past a PC looking for a virtual desktop device,” Wright said. “And last week’s fast is this week’s slow. I’ve got folks right now who complain about how long it takes to log in!”
In any case, users can expect to be wowed anew. The hos-pital will soon be moving on to VDI 2.0, a state where the
clinician login time is expected to drop to about 13 seconds.Before the VDI project, an initial login for the day could
take anywhere from three to 10 minutes. Now, after the initial login, clinical users moving from one device to an-other can reconnect in 15 seconds and non-clinical users in about 8 seconds. A single nurse who moves to 48 different devices during a single shift saves 45 to 90 minutes by not having to wait for connections.
Although Wright is somewhat sheepish about the no-tion, the virtual desktop infrastructure assembled by the Seattle IT team is seen by some as setting the industry standard. At a recent conference, Gartner analyst Mat-thew Brisse said the VDI project at Seattle Children’s Hospital was one of the best the firm has seen globally. When pressed, Wright said the solution’s primary vendors,
including Citrix Systems Inc., have told him no other IT organization has so deftly employed the technology.
So, what’s so special about it? According to Wright, it’s all in the architecture. Virtual desktop infrastructure solu-tions can be architected in a multitude of ways, he said. What many IT teams do is embed applications so that when users log on to a virtual desktop, all their applica-tions are present, making for a very fat virtual desktop. The virtual desktops at Seattle Children’s only have a
Windows 7 desktop, with all the applications and items in the start menu pointed back to a Citrix XenApp virtualized application server. “That makes load and unload of the vir-tual desktop very, very quick,” he said. “From an IOPS [in-put/output per second] perspective, we know exactly how much each virtual desktop will take.”
A provisioning server is used not only to provision virtual desktops but also to provision XenApp servers, so there is no question XenApp servers are the same across the silo, Wright said. “That’s using the whole [Citrix] suite the way it was meant to be,” he said. “A term that we coined is ‘double hop’—you’re hopping twice from your desktop to the application. More than anything, what makes us unique
ON THE AGENDA
The Evolving CIO Job DescriptionWhich skills are CIOs and IT leaders being asked to develop to better fulfill the CIO role?:
UPFRONT
A provisioning server is used not only to provision virtual desktops but also to provision XenApp servers.
Source: TechTarget’s 2012 Role of the CIO survey, which polled 629 CIOs, senior IT executives, IT managers and IT staff members.
is the double-hop architecture.”When talking about the hospital’s VDI solution, Wright
is adamant about giving credit to “the really smart” team of Citrix pros who are constantly tweaking the architecture to make it work better and faster. “We’re a big lean shop here, built on CPI, continuous performance improvement,” he said. “A second here, a second there, it means a lot when you spread it out over so many clinicians, and we’re always looking for that half second.” —Karen Goulart
The Good(?) News About Security BudgetsAbout the best thing we can say about global security budgets in 2013 is that they aren’t all shrinking. Roughly 40% of U.S. enterprise respondents reported that they expect flat year-over-year security budgets—not much to cheer about, but on the bright side, only 7% of enterprises and 9% of smaller businesses expected a decrease in this year’s budget.
BY THE NUMBERS
Source: TechTarget’s Security Purchasing Intentions 2013 survey, which gathered data from 1,182 respondents.
U.S. respondents' expectations on security budgets:
Knowledge ManagementKNOWLEDGE MANAGEMENT IS a process by which organiza- tions gather, refine and disseminate their intelligence in the form of documents, resources and people skills. The goal of a knowledge management system is to provide company managers with the ability to organize and locate relevant content and the expertise required to address specific business tasks and projects. Data entry, cataloging, filtering, contextualizing, mining and sharing are all key components of knowledge management processes. Source: WhatIs.com
40+60+z7+93+zflat
year-over-year security budgets
decrease in 2013 security budgets
decrease in 2013 security budgets
40% 7%
enterprise
9+91+zsmaller businesses
9%
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A company doesn’t become one of the world’s most recognizable handbag sellers by chance. Covetable clutches, wallets and purses are a must, of course, but Coach Inc.’s soaring sales and name-brand recogni-tion are also the result of a stellar e-commerce strat-egy that relies on superb analytics and client analysis techniques, as well as strong collaboration between the marketing and IT departments. Luis Garzon, senior director of enterprise architecture at New York- based Coach, says that his company’s commitment to client analytics has strengthened its point of sale (POS) and e-commerce strategy and operations, helping turn Coach into a household name.
ONE ON ONE
Could you speak about how you work with the marketing department on your social media efforts?At every company, marketing is really what’s driving a lot of that nowadays. We partner though, very closely, with
Coach Bags Sales Thanks to Client Analysis
our partners in marketing. A lot of what they’re doing in marketing really involves analytics and involves some of the ’big data’ aspects.
It also involves quite a bit of [asking questions, such as]: Where are we going to be integrating? Is it going to be Face-book or Twitter? How are we going to look at that informa-tion and do something with it?
We really have been partnering more on the analytical aspect of it because we’re looking to extend our marketing base into social media. But now we need the information back. We need to take that raw data and turn it into useful information and analyze it. That’s really what we’ve been focusing on. And it’s really about the analytics of that.
Do you base that analytics in-house? Or are you using another system? Perhaps like a Hadoop?
Luis GarzonTITLE: SENIOR DIRECTOR
OF ENTERPRISE ARCHITECTURE ORGANIZATION: COACH INC. HEADQUARTERS: NEW YORK, N.Y.
We actually do base it in-house quite a bit, although we do go through a cleansing process, and we do outsource that because that’s something we don’t want to be in.
Once we get that information, we do bring it in-house. We have expertise in-house that’s really looking at it.
That’s one thing with Coach: Internally, we really like to look at things about 50 different ways. It’s just our nature, and so we take care of most of the analytics in-house.
You have a very diverse clientele structure. How do you handle that from an IT perspective?It is very diverse. It’s actually not that difficult from an IT perspective because we’re not necessarily client-facing quite so much, other than our POS and our e-commerce sites.
From that perspective, though, we have taken an ap-proach where, especially in e-commerce, we’ve really built a solid foundation for being able to present our informa-tion and our products to all of our customers. And then we’re really using technology to be able to customize it for their region or their culture. That’s really where our focus is; I would say it’s really mostly around e-commerce tech-nology.
In terms of our POS systems, and how we integrate, we’re starting to look at doing some more ‘clientele-ing’ that’s very specific to a region or a customer. But that’s really nascent at this point.
Are you using any kind of cloud services currently to handle any of your databases?Not for our databases, but I was just mentioning ‘clientele-ing.’ We actually have rolled out a Salesforce.com solution in our North America stores. The stores that have been using it are enamored with it: The information that they’re getting from it, the real-time integration and the ability to collaborate with the customer right there and then—they just say it’s fantastic. It’s really changed the way they do business.
As a matter of fact, I went to one of our premier flagship stores on Fifth Avenue the other day and had a tour. They just have nothing but great words to say: “I can now [see] my top 10 customers. I didn’t even know what my top 10 customers were before.”
We’re able to roll out that solution relatively quickly. If we were to do it in-house, that would’ve probably taken three times the amount of time that it did.
Coach has established name-brand recog-nition thanks to its covetable handbags—and stellar client analysis efforts.
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IN 2010 , CIO Larry Bolick made a decision that would af-fect nearly every other IT decision at Aquent LLC from that day forward. Required to cut costs in the face of a recession, he and his IT team resolved to embrace cloud computing.
First, the Boston-based staffing and consulting agency switched its phones to a cloud-based voice service. Soon after, all email was migrated to Google’s Gmail, and ERP systems were sent out to Amazon Web Services. Within two years, more than a half-dozen of Aquent’s business ap-plications were cloud-based, and business intelligence (BI) is now headed to the cloud as well.
Perhaps most tellingly, it won’t stop there.“There’s definitely a growing sophistication with cloud
services,” Bolick said. “When we first started, it was all about getting servers up quickly and that sort of thing. Now we’re seeing business intelligence services and there’s data warehousing on the horizon.”
When it comes to cloud solutions, it seems there’s
very little nowadays that isn’t available “as a service” to IT departments. To be sure, the hype persists, but cloud has become less buzzword and more must-have technology for any enterprise looking for competitive advantage.
Gartner Inc.’s Top 10 CIO Business and Technology Priorities in 2013 showed cloud computing the No. 3 tech-nology behind BI and mobile. Members of the National Association of State CIOs ranked it their No. 1 technology priority for the coming year.
A recent TechTarget survey showed that IT leaders are increasingly interested in cloud services for an expanding array of tasks like business intelligence, data storage and disaster recovery. These “As a Service” options are not new to the marketplace, but analysts say many more are reach-ing maturity.
“Within five years, maybe even three years’ time, every-thing you buy is going to be in the cloud; it isn’t even going to be an issue,” said R “Ray” Wang, principal analyst and
Cloud à la CarteAs cloud computing expands, CIOs are picking from a vast menu of cloud options to fit their organization’s needs. BY KAREN GOULART
COVER STORY
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CEO at Constellation Research Inc. in San Francisco. “It’s the way customers want to consume it.”
CLOUD SERVICES’ ‘GRAVITATIONAL PULL’ Early cloud adopter Bolick believes cloud solution satu-ration may come even sooner. Once CIOs see how well a solution works, they want to build on that success. “There’s a gravitational pull” as services become more sophisticated, he said, pointing to his own recent switch to a cloud-based BI solution.
“After we moved our ERP system to the cloud, with our data already in the Amazon cloud, the next logical thing to think about was, should we move our BI there as well?” Bolick said. “We did, and now the operational data, both transactional and reporting, sits out on the Amazon cloud.”
The adoption of cloud solutions has also changed how Bolick and his team make IT purchasing decisions. Re-cently, a long-planned data warehousing upgrade was put on hold after Bolick’s IT director heard about Amazon’s upcoming Data Storage as a Service offering, Redshift.
“We put our product planning on hold for a bit until we could get a better look at [Redshift] and see if we might be able to take advantage of it,” Bolick said. “That’s almost unheard of in my experience—to have something we’ve been planning and putting it on hold to see what this new thing looks like.”
“More CIOs are going to be making decisions in just
this way, measuring every upgrade or replacement against what the cloud or Software as a Service providers have to offer, according to John Burke, principal analyst at Chica-
Do Your Cloud Security HomeworkWHILE SECURITY CONCERNS about cloud computing are not unfounded, CIOs must recognize that their caution may not match the needs of the business, according to analyst James Staten of Forrester Research. “The business simply wants to get the business objective done, and if the cloud allows them to do that, they would rather have IT fix the security problems on the back end rather than impede agility,” Staten said.
The dynamic is another reminder of why CIOs need to both maintain a strong relationship with the business and be well-versed in cloud security issues and answers. A lot of IT professionals, including security professionals, don’t know enough about the cloud and how a cloud provider handles security to know whether it’s secure or not. In these cases, erring on the side of caution and suggesting a cloud service isn’t safe can be a major misstep, Staten said.
“If you’re going to argue the cloud is not secure, make sure you have an account with the service in question and that you’ve tested to see if it could be made secure or not,” Staten said. “If you haven’t done that step and the competition has, that guy wins, and Lord help you if you want credibility on the same topic again.”• —Karen Goulart
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go-based The Nemertes Research Group Inc. “There’s a general movement to increase the amount of
stuff that is outsourced, and in a very selective way,” Burke said. “As a Service offerings are typically a great fit for that selective outsourcing strategy.”
Offerings like Desktop as a Service and Disaster Recov-ery as a Service, for example, are gaining popularity. “The benefits of having failover in the cloud are huge, in that you can essentially reserve some capacity but not pay to use it until you actually need it—and that’s a very attractive proposition,” Burke said.
Desktop as a Service is attractive because it takes the “thankless task” of desktop management out of the data center. Its prevalence will grow along with bring your own device (BYOD) initiatives, said Burke, who predicts that trend will have employees providing their own laptops as well, making provisioned desktops extremely desirable.
With the quality and scope of cloud services now avail-able, Bolick noted, entire small businesses can be up and running on cloud services within a day. His experience shows that sort of speed and agility can be leveraged for larger enterprises as well. “Cloud services are allowing us to do some things that we couldn’t even conceive of doing if we had to go out and build a data center,” he said.
AGILITY A BIGGER PRIORITY THAN SAVINGS IN CLOUD ADOPTION?If she had her way, University of Michigan CIO Laura
Patterson would never build another physical data center at her school. Like Bolick, Patterson was an early cloud proponent.
“The cloud model is a significant paradigm shift; it’s not just a different way of sourcing,” Patterson said. “Because of that, I think early adoption to the cloud is a competitive advantage.”
Patterson and her IT team are in the midst of a five-year technology modernization project, called NextGen Michi-gan. Cloud solutions are at the heart of that endeavor. At a research university, IT is not centralized, precluding the economies of scale that a consolidated IT function can reap. Providing cloud services to the various IT departments on campus is a way to save costs while not impinging on the agility often afforded by having local IT operations.
“What we’re trying to move to is having cloud offer-ings available, so rather than buying physical hardware, they can leverage those cloud offerings,” Patterson said. She believes having access to cloud services will actually result in greater agility and lead to more innovation by university researchers. “It’s a way of allowing the whole community to more quickly access the technologies they need.”
As for whether agility is starting to trump cost-saving as a prime motivation for adopting cloud services, Nemertes’ Burke, at least, was not ready to make that call. Some larger companies still say they’re going to the cloud to save mon-ey, but often the correlation doesn’t pan out, Burke said. Companies want, at the very least, to achieve cost neutral-ity. Sometimes, there will be a chance to spend less money,
but that’s not the standard for all moves to the cloud. Burke uses his own company as an example: Nemertes
recently transitioned to an Infrastructure as a Service model, moving from a dedicated hosting environment to a cloud environment.
“That saved us a ton of money on our internal server plant, and there are others who will be in a similar situa-tion,” Burke said. “But it’s not the case for everybody who moves to Infrastructure as a Service, and it’s also not the top goal for everybody.”
Indeed, IT leaders looking for a definitive, comprehen-sive total cost of ownership answer regarding cloud ser-vice adoption will seldom—if ever—find one, said James Staten, principal analyst with Cambridge, Mass.-based For-rester Research Inc. By the time a comprehensive total cost of ownership study is completed, it’s almost always wrong, he said—the technology moves that fast. Instead, the key is determining what tasks need to be accomplished, and whether the enterprise is more concerned with the time
taken to complete the project or with the ongoing costs once it’s done.
“In almost all cases, if speed matters, cloud is going to win. If it’s going to be about the ongoing cost of supporting this solution, on-premise is going to win,” Staten said.
But even this equation comes with qualifications. “If the application you’re wanting to deploy is super-complex and you want to maintain that same complexity when you move it, you probably shouldn’t move it.”•
Companies want, at the very least, to achieve cost neutral-ity. Sometimes, there will be a chance to spend less money, but that’s not the standard for all moves to the cloud.
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IF YOU WANT to make IT pros laugh, try suggesting that the importance of service-level agreements is overblown when it comes to cloud services. “Well, that sure sounds like something a vendor would say,” Merced College Direc-tor of IT Don Peterson said, enjoying a laugh along with his network manager, Arlis Brotner.
It was, in fact, something a vendor said. More specifi-cally, it was the shared opinion of executives from top cloud service providers Microsoft, Amazon.com, Rackspace and Salesforce.com. Take a spin around the Web, read some blogs, and it becomes apparent the leaders from these companies believe CIOs put too much emphasis on cloud service-level agreements (SLAs) and claim that IT custom-ers fret more about potential outages than about mastering the details of how the technology will be applied to and benefit their business.
Recognizing the business value of one’s cloud service doesn’t, however, diminish the value of an SLA, CIOs and
many experts insist. As more cloud offerings enter the market and find their way into not just IT departments but business units across the enterprise, proponents of cloud SLAs say that getting base-level parameters in writing—from uptime expectations to incident notifica-tion—is a must.
Merced’s Peterson takes the SLA very seriously. He recently oversaw the implementation of cloud-based stor-age to support the data demands of the California college’s nearly 18,000 students, staff and faculty. “We wouldn’t even think about [using cloud technology] without an SLA,” Peterson said. “It’s the ground rules.”
Brotner, Peterson’s colleague who researched and pro-posed that Merced turn to the cloud for storage, said base-level expectations have to be explicitly stated in writing. “It’s not just about downtime; it’s about response time, how quickly we report it and how they respond to it—that’s critical to have,” he said. Otherwise, you’re essentially
Cloud SLAs: A Necessary IngredientThe growing use of cloud technology doesn’t dilute the importance of service-level agreements—quite the opposite. BY KAREN GOULART
CONTRACT NEGOTIATION
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And those rights go well beyond the ones demanded by the IT department. As Wang states, the relationship be-tween the vendor and the “client” today often includes not just IT but the chief marketing officer and business execu-tives too. Going from on-premises software to the cloud is a chance for a clean slate for the IT department—not only
left in the dark. Unlike with on-premises technology, there is no one to turn to with questions or with blame.
As it turned out, Peterson and Brotner were fortunate to forge a good relationship with their cloud storage vendor, Zetta Inc., which didn’t balk at an SLA that included some finer points. “We needed it to really spell out how they were protecting our data, the redundancy, that it was en-crypted in transit and in storage, all those things,” Peterson said. “Some SLAs aren’t quite so granular as that, but we needed that. It protects us and it protects the vendor.”
A CLOUD SLA BILL OF RIGHTSIndeed, the importance of cloud SLAs—setting those ground rules—is more important than ever, according to analyst group Constellation Research Inc. Recently, the San Francisco-based firm released The Enterprise Cloud Buy-ers Bill of Rights. Focused on Software as a Service (SaaS), the document includes 55 “basic rights” that CIOs should demand over the life of a cloud service.
Constellation Principal Analyst and CEO R “Ray” Wang said that with the majority of enterprise software now being consumed via SaaS or cloud deployment, CIOs have to apply the same rigor in adopting and negotiating these contracts as for on-premises software. Just in terms of cus-tomer experience, for example, three “critical rights” must be met: quality guarantees and remuneration, ownership of and access to data with no questions asked, and ongoing financial and risk management transparency.
GARTNER ANALYST ROBERT DESISTO reviews the five most important elements of a cloud SLA:
• General availability. You generally want to have 99.7% to 99.9% uptime. Anything mission-critical has to be 99.9%.
• Measurement period. Determine how the vendor quantifies its uptime performance. Is it measured monthly or quarterly?
• What constitutes downtime? It’s not the same for all vendors. It could be five, 10 or 15 minutes, or more.
• Incident notification. Be sure the vendor will notify you of a problem, not rely on you to report an incident.
• Application of penalties. What is the financial remedy applied to you if the SLA is violated? Is it a percentage of fees or a credit on the following year’s invoice? Or will they prorate your bill?•
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perform as advertised.”Desisto won’t get any argument about that from Wal-
ter Weir. Earlier this year, the University of Nebraska CIO and his IT team carried out a cloud migration that moved 13,000 staff and faculty members from an on-premises legacy Lotus Notes system to a cloud-based system. For him, those more specific details about business value were covered in a request for proposals. But, he said, that didn’t diminish the importance of the cloud SLA.
“There’s an understanding that stuff happens and no-body’s going to go gunning for anybody unless it’s drastic,” Weir said. But you still want some degree of confidence that your partnership will be driven, managed and evalu-ated on the vendor’s ability to live up to this agreement.”•
in building a trusted relationship with the vendor but also building a strong partnership with the business units that are served by the cloud.
Analyst Robert Desisto at Stamford, Conn.-based Gartner Inc. concurs. With so many players now involved in procuring cloud applications, it’s important that CIOs bring their SLA expertise to bear. “It’s absolutely another reminder of how important it is for CIOs to know what’s happening in the business,” he said.
The issues and legalities inherent in cloud computing are complex, to be sure, Desisto said. But there are some things that should be simple and straightforward. For example, some cloud applications are less mission-critical than others, and the lack of their availability might not harm a company, he said. But even for these less critical business apps, buyers must insist on reaching a written agreement on performance expectations. He’s yet to meet the CIO who feels otherwise.
“The bottom line is, if vendors are so confident about their performance, why not put it down on paper? What is the resistance?” he said. “The resistance is they don’t want to have the liability out there that they won’t be able to
“ The bottom line is, if vendors are so confident about their performance, why not put it down on paper?”
— Robert Desisto, analyst, Gartner Inc.
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HOW DO YOU transform a technology-focused enterprise architecture fine-tuned for the delivery of IT services into one that is developer-friendly and focused on external customers? That was the challenge for Kevin Miller, vice president of IT at insurance and financial services firm CUNA Mutual Group. He is responsible for CUNA Mutual’s IT strategy, enterprise architecture group, business intel-ligence and data warehousing, and quality management. His answer? He augmented his IT enterprise architecture with three additional disciplines:
• Business architecture: to translate business strategy into IT strategy
• Information architecture: to treat data as an asset
• Application and integration architecture: to allow IT to respond to business requests nimbly
“It certainly isn’t easy and the change takes time. Make sure you’re committed to it,” he said.
Miller, who joined CUNA Mutual in 2006, could have let enterprise architecture (EA) rest on its laurels. Over the years the EA group had developed a set of standards and technologies that enabled IT to deliver high-quality services at the lowest possible price point to the company, which has $16 billion in assets and operations across the U.S. “That’s part of getting the technology architecture right,” he said. “We were very good at it.” The existing EA framework, however, operated more as a gatekeeper for best technology practices than as a force for business results. In 2011, Miller and others decided that needed to change, and embarked on a journey they now refer to as the transfor-mation of EA 1.0 into EA 2.0.
“We were seeing siloed solutions. We needed greater agility and speed to deliver solutions. We certainly had data challenges. We wanted to improve our customer ex-
Making the Business Architecture TransformationTurning your enterprise architecture into a framework that’s business-centric and customer-focused is hard work, and more art than science. BY LINDA TUCCI
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perience,” Miller said. “There were a lot of drivers for why we would do this EA transformation. The macro challenge was making sure our business strategy mapped into the IT strategy.”
In this first of a two-part story about CUNA Mutual’s move to EA 2.0, Miller lays out some steps he’s taken to get IT and business on the same page with a new archi-tecture. In part 2, he talks about finding business solution architects with the right stuff.
‘IT’S ALL ABOUT PEOPLE’Once Miller’s team decided to add new disciplines—ap-plication and integration, business and information—to its EA framework, it needed to find people to run them. The company’s old enterprise architecture was supported by six technical architects, organized around technical domains. Those architects remain. For the three new architectures, Miller’s team created detailed roles that mapped to each discipline. The team then scouted internally for candidates who were respected by their IT peers, had worked in vari-ous business areas and—most critically—had shown an interest in CUNA Mutual’s business.
“It’s all about people. You’ve got to have people who are OK with a little ambiguity because there isn’t a cookbook for how you do this type of work. There are EA frameworks out there for sure, but this is a changing landscape, and EA as a business-centric discipline is relatively new,” Miller said.
“ There are EA frameworks out there for sure, but this is a changing landscape.”
— Kevin Miller, vice president of IT, CUNA Mutual Group
Six employees from within IT filled the bill. Miller also recruited externally for folks with “been there, done that” experience in operating a business-centric architecture. So far, he’s hired three outside experts. “It’s ending up being a nice blend of people.”
CREATING A REFERENCE MODELLike many companies, CUNA Mutual generates and collects a vast amount of data. Deriving value from the data—to improve customer service, to boost sales—required edu-cating the business and IT about information architecture. “We actually went around to different areas of both the business and IT, and talked about what our vision was,” Miller said. For IT people, the discussion was more tech-nical, focusing on such processes as master data manage-ment. Business discussions focused on data governance.
Concepts are one thing, practices are another. To get its information-centric architecture off the ground, Miller launched a strategy centered on developing “business-centric usage scenarios” to pinpoint the type of data the
business required. “If you hand people a blank piece of pa-per and say, ‘OK, give me your data requirements,’ they will stare at you blankly. You need to walk them through it: ‘It is my understanding that when we’re marketing a product, the process looks like this. What type of information would you like to have about the customer so you market products that are relevant to them?’”
HOW TO ACHIEVE QUICK WINSThe power of the new EA approach was demonstrated this year when it was applied to a rather trivial problem that required an across-the-board solution. Among CUNA Mu-tual’s various application systems, some allowed policies to be presented to the customer electronically; others did not.
“For customers with more than one of our products, it would sure seem odd that sometimes they could access their policies electronically and other times not,” Miller said. The new EA framework offers an enterprise service-oriented integration architecture for the electronic present-ment of policy statements throughout the company.
“Once we put in an enterprise integration architecture that was easy for our application development teams to use, they did. If we didn’t do this, they would continue to create their one-off solutions based on their business area’s pri-orities,” Miller said. “Is that the most dynamic example of
a unique use of technology? Heck no! Is it a great example of doing something that should have been done and is easy enough for us to do, and adds a lot of value to our custom-ers’ experience? Absolutely!”
EA GOVERNANCE MODELS: THE FULL MONTYTo assure that IT and the business use the services and standards embodied in EA 2.0, Miller has implemented a multi-tiered governance model.
This ranges from a “full engagement” model with up-front input from all three of the new enterprise architects for risky projects calling for a lot of architectural change, down to a low-touch or “endorse model” for projects like electronic presentment, where the EA team alerts develop-ers to the enterprise service. And CUNA Mutual project leaders are held accountable for interacting with the EA group, Miller said.
“It is actually one of our monthly metrics to track use of the enterprise services,” Miller said. His group tries to make sure every project comes before EA in the early phases of its development lifecycle. “If we miss engage-ment on a particular project and find out about it later, then we specifically follow up with that project to help both the business and IT people understand what we want to do versus what happened.”•
KEVIN MILLER IS vice president of IT at CUNA Mutual Group, a Madison, Wis.-based insurance and finance services provider with $16 billion in assets and operations across the U.S., and is responsible for CUNA Mutual’s IT strategy, enterprise architecture group, business intelligence and data warehousing, and quality management. Here, he describes IT’s ongoing transition from an enterprise archi-tecture focused on technologies and technology standards to a framework designed to drive business results. “EA 2.0” adds three new disciplines to the existing enterprise architecture framework: business solutions architecture, information architecture, and application and integration architecture.
Which of the three new architect roles was the most difficult to define, and which was the most difficult to fill?They had all their own set of challenges, but I think the
business solutions architect role was among the hardest to fill because there is a lot of art in translating business strategy into IT strategy. It’s not a black-and-white exercise, there’s no right and wrong answers, there’s no equations that tell you the answer. It is very much about how you leverage your skills as a leader and as a facilitator who can really help a business area put down on paper how their business strategy really translates into what they want to do.
Who made the grade in your IT organization?The people we took internally were people who were well-respected within IT and had shown an ability to be very nimble across the organization [and] to work with a lot of different business areas, and who had shown an interest in our business. We do insurance and asset management. If the business solutions architects aren’t interested in those
Business Solutions Architects Who Make the GradeTurning a technology-focused enterprise architecture into a business architecture calls for a designer with the right stuff. BY LINDA TUCCI
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functions and are only technically oriented, obviously they wouldn’t be a good fit for those roles. Soft skills were very important. We wanted people who could herd the cats, so to speak, and help people across the organization come to a shared understanding of the business.
What does that give you? You have a business strategy both technical and nontechnical individuals can under-stand. By the time you move into executing projects and initiatives against that, your project teams really have a sol-id foundation and context for what’s trying to be achieved.
So, all those miscommunications between business and IT are addressed up front?Absolutely! And if you think of the old model, it used to look a lot like this: IT organizations would go to business areas and say, ‘Give me your requirements,’ and the busi-ness areas, of course, don’t know exactly what their detailed business requirements are because they were not doing it. It was a tough situation for both sides in terms of getting on the same page. We’ve found the business solution architects can really be the glue between these two, and leverage some tools and capabilities to make it easier for both parties.
We wanted people who could herd the cats, so to speak, and help people across the organization come to a shared understanding of the business.
Have you found any changes on the business side as they work with your new business solutions architects?Absolutely. If a business area was accustomed to working with IT people who were completely technology-focused, they would be very surprised when the IT people knew something about how their business process worked. We’d get comments like, ‘So, where do you guys live in the orga-nization?’ I think it is consistent with technology becom-ing part of everybody’s role and the lines between what a business person is and what an IT person is—those lines continue to blur. By the time my career is all said and done, there might not even be a difference.•
WHILE THINKING ABOUT how to write a column about cloud computing, I remembered an old television commercial for Certs where two 1950s trendy-looking women, possibly even twins, are having a disagreement:
“Certs is a candy mint,” one says.“Certs is a breath mint,” the other refutes.“Stop, you’re both right!” proclaims the jaunty announc-
er. “New Certs is two mints in one! Stops bad breath in seconds, tastiest mint of all. Yes, only new Certs gives you two, two, two mints in one!”
What possible connection, you might be thinking, could exist between mints and cloud computing? For starters, they both use the same name to mean multiple things. They both serve multiple purposes: Depending upon who you are, you might use the product for something differ-ent. However, in the case of breath mints, the applications appear limited to two; in the case of cloud computing, the number of applications seems almost limitless. They both apparently require clarification and, even then, we are left a bit uncertain (no pun intended, seriously).
Cloud Computing: Candy Mint or Breath Mint?
A recent poll of 1,000 U.S. citizens performed by Euro-pean cloud supplier Webfusion revealed the following:
• 25% said they had a clear grasp of what “cloud” means;
• 32% reported having no understanding of the term “cloud”;
• 63% didn’t identify Dropbox, iTunes, Gmail or Hotmail as “cloud” services;
• 91% didn’t make a connection between “cloud” and “scalable hosting.”
Perhaps some of the confusion can be attributed to the different types of cloud implementations available:
• Private cloud: Internal to an enterprise, accessible to trusted users behind the enterprise firewall, similar to an intranet;
• Community cloud: Internal to an enterprise, accessible
to trusted users both behind and outside the enterprise firewall, such as an enterprise and its supply chain part-ners, similar to an extranet;
• Public cloud: External to an enterprise, accessible to all users, typically registered or unregistered, for example Amazon or iTunes;
• Hybrid cloud: Most often a combination of private and public cloud business and technology architectures.
In a recent article in The Wall Street Journal, “The era of cloud computing” by Jalaj Roy Choudhury, cloud computing is defined by three major categories:
1. Infrastructure as a Service 2. Platform as a Service 3. Software as a Service
To add further clarity, the article offers seven additional subcategories for describing cloud computing:
a. Storage as a Serviceb. Database as a Servicec. Information as a Serviced. Application as a Servicee. Integration as a Servicef. Security as a Serviceg. Testing as a Service
Can you map the types of cloud implementations to the major categories? Can you map the subcategories to the major categories? I can’t with any certainty. Does each subcategory map to only one major category or is there a one-to-many relationship implied or, worse, many-to-many? Not clear.
The same article describes IBM’s point of view on cloud computing as “only a different way to deliver computer resources, rather than a new technology; it has sparked a revolution in the way organizations provide information and service.” Sounds a bit like one of the world’s technolo-gy giants and a clear leader in the space is saying that cloud computing is not a candy mint or a breath mint.
Let’s recap: At a minimum, cloud computing is hard to define, and the majority of people don’t know what it is. In the more extreme, according to very credible sources, it’s not a new technology and has sparked a revolution. So what is all the fuss really about? A deeper dive into the literature reveals an impressive list of powerful motivations for organizations to adopt cloud computing as “a different way to deliver computer resources”:
• Reducing capital investments required for startup, growth and maintenance;
• Moving IT expenditures from balance sheet assets to profit-and-loss expenses;
• Replacing high fixed-cost/low variable-cost models to
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low fixed-cost/high variable-cost models for managing IT investments;
• Reducing time to market for new products and services;
• Enabling dynamic scalability and increased alignment of business demand and IT costs;
• Allowing for more efficient and effective management of human resources;
• Decreasing the carbon footprint.
While the list of reasons to move to the cloud is impres-sive, the frequency and pace of actual cloud implementa-tions have been restrained. Among the major reasons cited by CIOs for either avoiding or taking more conservative approaches to cloud computing adoption are:
• Concerns about security and privacy;
• Challenges with regulatory compliance;
• Technical challenges and significant expenses related to moving legacy (non-virtualized) applications to the cloud;
• General loss of control and vendor dependency.Adoption and deployment of cloud computing does
seem to be gaining momentum in the private cloud space. According to a survey of primary decision makers across North America and Europe performed by 451 Research late last year:
• 47% reported plans for internal cloud projects in 2013;
• 64% reported that they remain in the initial phases of cloud adoption: standardization, consolidation and virtualization;
• 47% said they are facing significant obstacles to moving beyond virtualization to a more complete cloud implementation;
• 34% characterized significant obstacles as nontechnical (organization, budget, people, time, buy-in and resis-tance to change).
It would be presumptuous, perhaps even sacrilegious, to write any article about any technology without mention of a Gartner Inc. prediction. I certainly don’t want to disap-point, so here it is: “One-third of user data in the cloud by 2016.”
Gartner’s rationale for this seemingly bold prediction is based on the rapid growth of mobile devices, especially driven by consumers who have an apparently insatiable appetite to store, share and access any data anywhere and
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anytime. As a baseline, Gartner asserts that “…user content transferred to the cloud in the year 2011 alone accounted for about 7 percent of the total.” In this context, Gartner speaks to us about the emergence of yet another type of cloud—the personal cloud—the ultimate vehicle for stor-ing and managing photos, videos, games, music or what-ever. A few supporting data points from the Gartner study help us put this prediction into further context:
• 464 gigabytes: Personal cloud storage requirement per household in 2011
• 330 exabytes: Total personal cloud storage requirement in 2011
• 3.3 terabytes: Personal cloud storage requirements per household in 2016
• 4.1 zettabytes: Total personal cloud storage requirements in 2016
Candy mint? Breath mint? Both? You decide. Bottom line: It seems that what we call it is inconsequential com-pared to what we do with it.
Is this dynamic really much different than how we deal with any other technologies? Do our internal and external customers, shareholders and stakeholders care about what we call it? I think not.
Do they care about how we create sustainable business value and drive growth in increasingly complex, volatile and competitive markets? Of course they do. Let’s call it the Business Value Cloud…•
CIO OUTLOOK
Do they care about how we create sustainable business value and drive growth in increasingly complex, volatile and competitive markets? Of course they do.
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KAREN GOULART is features writer for SearchCIO.com. Write to her at [email protected].
LINDA TUCCI is news director for SearchCIO.com. Write to her at [email protected].
WENDY SCHUCHART is senior site editor for SearchCIO.com. Write to her at [email protected].
HARVEY KOEPPEL is the president of Pictographics Inc., a management and technology advisory and consulting services firm. Koeppel is also vice chairman of the World
BPO/ITO Forum and recently served as the executive director of the Center for CIO Leadership. From May 2004 through June 2007, Koeppel served as the CIO and senior vice president of Citigroup’s Global Con-sumer Group. Write to him at [email protected].
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