NASSCOM Infrastructure Management Summit 2013 - Five Forces Shaping the IM Market - David K. Johnson

Making Leaders Successful Every Day

© 2013 Forrester Research, Inc. Reproduction Prohibited 2

Special ThanksPEOPLE WHO GAVE FREELY OF THEIR PERSONAL TIME FOR THIS RESEARCH

› Stefan Falk, COO/CFO at McCann Worldgroup, formerly Head of Strategic Programs at Ericsson & later Head of Sustainable Development at Green Cargo

› Colleen Barrett, President Emeritus, Southwest Airlines and co-author of “Lead with LUV: A Different Way to Create Real Success”

› Jim Stikeleather, Chief Innovation Officer at Dell Servcies, author of “Business Innovation in the Cloud: Executing on Innovation With Cloud Computing”

› Patrick Hoverstadt, Author of “The Fractal Organization: Creating sustainable organizations with the Viable System Model”

› Qua Veda, Intel, Office of the CTO: Leads mindfulness initiative

› Forrester: Doug Washburn, Chris Voce, JP Garbani, Eveline Oehrlich, Christian Kane, TJ Keitt, Simon Yates

Five Forces Shaping the IM MarketDavid K. Johnson, Principal AnalystServing Infrastructure and Operations Professionals

August 21, 2013

PeopleV


Base: 1058 North American and European enterprise IT services decision makers; Source: Forrsights Services Survey, Q2 2012

What’s Keeping Your Customers Up at Night Isn’t What You Think it is…

How much impact will the following changes & initiatives will have on your firm's IT services spending over the next 12 months?

Bringing in new, smaller, more innovative vendors

More active role of business executives in IT decisions

Increasing use of SaaS, IaaS or BPaaS

The increasing use of smartphones and tablets

The need to lower our IT operational costs

The need to innovate and grow our business

10%

21%

28%

37%

42%

50%


Agenda

›The Five Horsemen of the Apocalypse

›Why You Should Ride Them

›How They Will Change IT’s Role

›How Priorities Will Change

›Services Forecast

7

The Four Five Horsemen of the Apocalypse


The Cost of Managing Infrastructure is No Longer Sustainable, Leading to Industrialization of IT and a New Generation of Converged Infrastructures

Horse Force 1

9

Cottage Industries Will Give Way to Industrialization

Provisioning Machine

Application Deployment Machine

Patch Management Machine

Monitoring and Event Handling Machine

Change Management Machine

The VDI System Life Cycle Is An Aggregate Of Component Life Cycles

January 2013 “Hosted Virtual Desktops Versus Physical PCs: Understanding The Operational Cost Differences ”

Life-Cycle Activities For Hosted Virtual Desktops

January 2013 “Hosted Virtual Desktops Versus Physical PCs: Understanding The Operational Cost Differences ”

Taxonomy


What it Means

› Specialize in key applications for converged infrastructures and automation, such as VDI

› Specialize in sophisticated converged infrastructures from aligned vendors


Shift from automating people out of business to making them more effective

Horse Force 2

The secret for I&O is…

Engagement And IT Satisfaction Are Linked

July 2013 “Customer Experience Methods Guide Workforce Experience Design”


Source: Forrsights Developer Survey, Q1 2013

Example: Cloud Developers Are Not Your Typical Coders

Cloud developers are:

›Leaders

› Innovators

›Risk takers

›Troublemakers

Non-cloud developers are:

›Team players

› Iterators

›Conservative

›Less empowered

24% 76%


It is easy for me to get funding for new projects or tools I need to do my job

I feel recognized for the effort I put in

I feel challenged every day

I love my job

I have access to the technology and tools that I need to solve my own prob-lems and challenges at work

If I can find a better way to do my job, my boss will always support me

I feel empowered to find new ways to solve customer and business prob-lems

It’s clear to me how my work contributes to my company’s overall success

I like sharing what I know with others

18%

49%

36%

53%

57%

62%

62%

63%

81%

39%

63%

64%

67%

72%

74%

74%

76%

82%

Cloud developers (N = 124)

Non-cloud developers (N = 566)

Cloud developers love their jobs and feel successful;non-cloud developers struggle with funding and recognition

Base: 124 North American and European enterprise software developers using cloud; Source: Forrsights Developer Survey, Q1 2013

“Thinking about your current role at work, please indicate how much each statement describes your attitudes.”(4 or 5 on scale of 1 [doesn’t describe me at all] to 5 [describes me completely])


What it Means

› Nurture the risk takers and passionate troublemakers in your organizations

› Empower them with new tools and the freedom to experiment

› Extend this culture to the companies you do business with


Workforce Mobility is Changing Rapidly…

Horse Force 3

How Employee Work Styles And Preferences Are Changing

May 2013 “Five Seismic Forces Reshuffle The Workforce Vendor Ecosystem”


What it Means

› Solve for flexible workstyles with your services solutions

› Think ahead of the IT shops you serve. Don’t wait for them to ask you to be ready


Microsoft Windows is no Longer Leading the Device OS Market

Horse Force 4

The Rise Of Mobile Devices Resets Microsoft’s Share Of Personal Devices To About 30% (Cont.)

October 2012 “Windows: The Next Five Years”

February 2013 “2013 Mobile Workforce Adoption Trends”


26


27


28

PC Lifecycle Management as We Know it

Source: The Forrester Wave: Enterprise Client Management Suites: Q2, 2012

IS NO LONGER SUSTAINABLE

© 2012 Forrester Research, Inc. Reproduction Prohibited

Don’t know; I’m not knowledgeable about our plans for Windows

None; we plan to migrate from Windows to a different platform

Not applicable; end users choose their OS

We have specific plans to deploy but won’t start in the next 12 months

We have specific plans to deploy Windows in the next 12 months

We expect to migrate to Windows but have no specific plans yet

We plan to skip Windows and wait for the next release

We haven’t looked at Windows yet, so we don’t have a reaction

5%

1%

0%

10%

7%

49%

1%

27%

6%

2%

2%

5%

4%

24%

10%

47%

2012 Windows 8 (N=1,282)* 2009 Windows 7 (N=653)

“What are your firm's plans for deploying Windows?"

Base = North American and European IT hardware decision-makers

Source: Forrsights Hardware Survey, Q3, 2009

*Source: Forrsights Hardware Survey, Q3, 2012


What it Means

› Mobile Device OSs are easier and less costly to manage

› The big opportunity for Microsoft lies in the AppContainer model – they are ALL IN on this

› Help your customers understand the implications of this and simplify their ops whenever possible with newer platforms


Employee Spending on Technology For Work Will Continue to Increase, Along with Self-Support

Horse Force 5

How Employee Work Styles And Preferences Are Changing (Cont.)

May 2013 “Five Seismic Forces Reshuffle The Workforce Vendor Ecosystem”

Many Info Workers Spend Their Own Money On Technology


What it Means

› Services strategy must shift to embrace capabilities that foster consumerization

› Take a portfolio approach

› Consider marketing services directly to the employee


Example: Digital Workspace DeliveryFINITE NUMBER OF ELEMENTS TO MANAGE, INFINITE PERMUTATIONS


Terminal Services (Shared Server-Based)

Internally Hosted Virtual Desktops

Cloud-Hosted Virtual Desktops

Locally-Deployed Virtual Desktops

Application Virtualization and Streaming

Enterprise Application Store


Quick Recap

› Force 1: Craft building gives way to industrialization with converged infrastructures

› Force 2: Employee engagement and effectiveness become top priority

› Force 3: Workforce mobility is expanding rapidly

› Force 4: Microsoft is no longer leading the device OS market

› Force 5: Employee tech spending and self-support continue to increase


The Case for Embracing the Changes…

These high performers seek . . .

. . . time and tools for engagement . . .

. . . and adaptability to changing conditions.

What science knows about motivation…

Motivation 2.0 = Extrinsic: work faster, make more money, keep your job…

Motivation 3.0 = Intrinsic motivation

1. Autonomy (our desire to be self-directed)

2. Mastery (our urge to make progress and get better at what we do)

3. Purpose (our yearning to contribute and be part of something greater than ourselves)

When these come together, we can experience “flow.”

Conditions of flow

1. Clear goals (expectations and rules are discernable)

2. A high degree of concentration on a limited field of attention

3. Direct and immediate feedback (examples: video game and programming)

4. Balance between ability level and challenge

5. A sense of personal control over the situation or activity

6. The activity is intrinsically rewarding.

The higher the complexity, the more flow matters!

Source: Mihaly Csikszentmihalyi via Stefan Falk, Ericsson

How flow in action saved an airline

How flow in action saved $20M

How “20% Time” Builds New Businesses

Consumerization Fuels Productivity, Customer Service

Base: 1045 Information workers; Source: Forrsights Workforce Employee Survey, Q4 2012

What do you feel are the benefits of using a personal device or application you’ve downloaded,chosen, or paid for on your own for work? (Select all that apply)

Allows me to better serve our customers

Makes it easier for me to solve business problems

Higher job satisfaction

Allows for a better work/life balance

Makes me personally more efficient and productive

44%

51%

53%

56%

65%


77% of Developers Code on Personal Time

Source: Forrsights Developer Survey, Q1 2013

Why do you spend your own time developing applications/websites?

To improve my own productivity at work

As part of a personal hobby or pastime

To keep my skills sharp by learning new technologies

I generally enjoy programming and learn-ing about new technologies

54%

68%

71%

71%

Base: 1,569 Software developers who spend time on personal projects


Base: 690 North American and European enterprise software developers; Source: Forrsights Developer Survey, Q1 2013

Cloud developers are building for a wider range of platforms

“Which of the following device types do you target with the software you develop or design?”

Smart TV (e.g., Yahoo Widgets, Google TV)/currently support

In-vehicle infotainment (e.g., in-car GPS, Microsoft Sync)

Game console

Embedded device

Mainframe

Feature phone

Non-x86 servers (e.g., Power, Sparc)

Intel (x86) servers

Tablet

Smartphone (e.g., iPhone, Galaxy III)

Ultrabook

Netbook

Browsers (e.g., Chrome, IE 9, Safari)

Notebook/laptop

Desktop PCs

1%

1%

1%

9%

16%

2%

10%

25%

13%

14%

19%

22%

41%

58%

71%

8%

8%

9%

13%

15%

17%

23%

40%

42%

45%

45%

50%

60%

77%

81%

Cloud users

Non-cloud users


Base: North American and European enterprise software developers; Source: Forrsights Developer Survey, Q1 2013

Cloud developers are widely using open source technologies“Which of the following classes of open source software tools/frameworks have you used for development or deployment in the past

12 months?” (Select all that apply)

Other (please specify)

Have not used open source software

Management and monitoring (e.g., Nagios, Cacti, Shinken)

Release/deployment management tools (e.g., Chef, Cf Engine, Puppet)

NoSQL DBMSes (e.g., Apache Hadoop, MongoDB, Riak, Couchbase)

Business applications (Sugar CRM, Bravo)

Portals or mashup servers (e.g., Liferay, JBoss Portal, eXo)

Business intelligence tools (e.g., BIRT, Jasper Reports, Spago)

SCM tools (e.g., Git, Subversion, Mercurial)

Content management systems (e.g., Alfresco, Drupal)

Application frameworks (e.g., Spring, Rails, Zend)

Build and release management tools (e.g., Hudson/Jenkins, Maven, Ant)

Application server (e.g., JBoss, Tomcat)

Development IDEs (e.g., Eclipse, NetBeans)

Relational DBMSes (e.g., MySQL, PostgreSQL, SQLite)

Web servers (e.g., Apache, nginx)

Operating systems (e.g., Red Hat Linux, Suse, Android)

4%

31%

3%

4%

5%

3%

3%

6%

16%

6%

10%

16%

22%

35%

32%

32%

33%

2%

3%

20%

20%

21%

21%

22%

24%

26%

30%

31%

35%

45%

54%

57%

58%

66%

Using cloud computing/elastic applications (N = 125)

Not using cloud computing/elastic applications (N = 572)


Base: 124 North American and European enterprise software developers; Source: Forrsights Developer Survey, Q1 2013

Enterprise cloud developers primarily use IaaS

“Which of the following cloud-based services have you employed on a regular basis?” (Select all that apply)

Don’t know

Nonrelational database

Mobile back end

BPM

Application-level caching

Content delivery network

Integration (e.g., Dell Boomi, IBM Cast Iron)

Message queuing

Social (e.g., salesforce.com Chatter)

Content management

Messaging

Development tools/IDE (e.g. Cloud9, Cloud Foundry)

Relational database (e.g. SQL Azure)

Storage

Compute (e.g., Amazon EC2, Microsoft Azure VM Role)

5%

15%

15%

15%

19%

19%

21%

23%

27%

29%

31%

32%

37%

45%

48%

IT Department Priorities are Out of Phase with Demand


Source: Forrsights Hardware Survey, Q4 2012

INTEREST IN KEY FLOW ENABLERS REMAINS LOW

How IT priorities will shift…

56

TO HETEROGENEOUS OS AND DEVICE SUPPORT, SELF-ENABLEMENT AND CLOUD

© 2012 Forrester Research, Inc. Reproduction Prohibited


Services Survey Results

July 2013 “A Mixed Outlook For The Global Tech Market In 2013 And 2014”


Base: 488 North American and European enterprise IT services decision makers; Source: Forrsights Services Survey, Q2 2012

Improved Customer Engagement and Employee Empowerment Are Driving Vendor SelectionHow will (or has) the rise of new technologies for engaging customers, empowering employees, and collaborating with partners

impact your IT services spending over the next 12 months?

Choose new suppliers with specialized technologies and processes for improved engagement)

Use more public as-a-service offerings like testing-as-a-service or storage-as-a-service

Hire a third party to help us integrate the new systems with the core enterprise applications

Hire a third party to help us develop new customer/partner applications for smartphones

Reduce spending on traditional ERP/accounting systems to free up money for investment in new systems

Hire a third party to help us develop new customer/partner applications for tablets

44%

31%

26%

23%

22%

21%


Base: 3659 Global enterprise IT decision makers; Source: Forrsights Budgets and Priorities Tracker Survey, Q2 2012

Services-Specific Spending Priorities

Which of the following initiatives are likely to be your IT organization top technology priorities over the next 12 months?

Mobile applications & middleware

IaaS

SaaS

Infrastructure management & outsourcing

Maintenance & support services

31%

29%

26%

23%

20%

21%

21%

18%

19%

15%

Increase 5%-10% Increase 10% or more

What it all means to you is . . .


How Do You Bring it All Together?

› Indian services firms have so much opportunity to change perceptions and lead from the front

› It will take more investment in human capital and innovation leadership

› India can capitalize on innovation thought leadership in IT services with fresh ideas

› Discussion: I want to challenge you to think about what are India’s strengths

• Context: Amazon, Microsoft – both ran cloud scale infrastructures and never saw their applications to enterprise until much later.

Thank youDavid K. Johnson

+1 303-522-0579

[email protected]

Twitter: david_kjohnsonBlog: blogs.forrester.com/david_johnson

LinkedIn: www.linkedin.com/pub/david-johnson/3/720/610/

mailto:[email protected]

http://blogs.forrester.com/david_johnson



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