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Smart Enterprise: Greater Expectations

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in technology and delivery models to enable another true watershed moment in IT. Organizations that embrace this paradigm shift will prosper." In this new model, IT won't build service components anymore; instead, through automation, they'll be designing the actual assembly line. "IT people will be seen as the innovative Henry Fords of the future," says Dominic Schiavello, Senior Advisor for Product Marketing with CA Technologies. More than a century ago, Henry Ford and other early manufacturers invented not only the assembly line, but also the supply chain model. Today, manufacturing pro- duction managers use their supply chains to balance internal resources — including budget, systems and staff — with external resources, mainly subcontractors and sup- pliers. In his 1922 book, My Life and Work, Ford described the way he treated his branch factories as if they were external providers: "Wherever it is possible for a branch to make a part more cheaply than we can make it in Detroit and ship it to them, then the branch makes the part." In the manufacturing lifecycle, a busi- ness idea moves quickly through the design, building, production, distribution and consumption of that idea. Similarly, the IT supply chain model helps solve one of the biggest issues of IT: getting services for customers faster to market. Now that it's possible to move many IT resources to the cloud, CIOs can begin think- ing of their IT operations in a similar way. They too have internal resources, including budgets, staff and internal IT systems. But they also have a new and growing roster of external resources — suppliers of a wide and growing range of IT services in the cloud. To proactively meet the needs of the business, CIOs will need to balance these internal and external resources, just as manufacturing managers have been doing for more than a century. "I believe the IT supply chain has started to closely resemble the traditional manufac- turing model," says Mandar Sukhatankar, CIO of Alibre Inc., a Richardson, Texas, sup- plier of CAD software. "The real value comes when IT, as a business partner, delivers those offerings that align most closely [with] the business' strategy, budget and vision — and brings them together into one seamless solution that is transparent to the consumer." This idea of a dynamic IT supply chain also resonates with Leroy Williams, VP of IT and Services at Ball Corp., a Broomfield, Colo., manufacturer of consumer packaged goods and aerospace technologies. Williams has learned well from the success of the manufacturing side of his company, which employs more than 14,000 people world- wide and had sales last year of more than $7.3 billion. Warming to the analogy, Williams likens the utility aspects of IT to basic electricity. "While you don't need to be the provider of electricity, electricity is a must-have, and you need to manage it as core to your infrastructure," he says. Similarly, by relying on external IT service providers, Williams can allow his IT organization to be more efficient — and to focus more on innova- tion. "All that speaks directly to the IT supply chain," he adds. In managing the internal side of his IT supply chain in North America, Williams engages a global contractor for a variable cost model. For example, when he needs to deploy new PCs and laptops, he relies on a national IT contractor to understand Ball's standards and expectations, and then deliver quickly. "They're in, they're out, boom!" Williams says. This model also enables Williams' IT department to support Ball's plant infrastruc- ture, giving the plant the ability to serve its customers on a one-to-many basis over the Web rather than dealing with individuals on the phone, via fax or with e-mail limitations. Further, Williams won't need to invest in dedi- cated IT resources such as new servers, and will no longer have the costs associated with maintaining such an infrastructure — heat- ing, cooling, power, and staffing costs. "The cloud's promise is to enable an enterprise to tap into global on-demand resources with better economics and highly specialized skill sets," Williams adds. While the notion of an IT supply chain is not entirely new, the dynamic nature of today's IT is. Schiavello of CA Technologies says that despite outsourcing, internal IT has traditionally been stuck in a static supply chain model for more than 40 years. "IT has been constrained by tight budgets, the [number] of people they've got on staff, and what the infrastructure looks like," he says. All that is changing now — and quickly. New technologies form the core of the dynamic IT supply chain. Virtualization technology adds flexibility and shared com- puting resources. The cloud brings IT service suppliers as close as a click on a website, and makes it easier than ever to add and remove IT services. This provides CIOs nearly unlimited choices for obtaining the components they need to meet business requirements. With physical IT constraints unlocked, thanks to the cloud, CIOs also gain the ability to scale their IT infrastructures as needed. In addition, they gain new flexibility and cost savings, courtesy of the cloud's pay-as-you- go model for IT services. Bridge Gapper Also, because IT is increasingly viewed as a provider of business services, the dynamic IT supply chain helps CIOs bridge the gap between business demand and supply by freeing up time traditionally spent on mundane tasks and enabling IT to be more innovative. With many IT budgets declining, that's important. "Many CIOs are still facing 2 to 5 percent budget decreases, with some lucky ones having a flat budget with the expectation that they deliver more services for the same money," says Mark Lukianchuk, VP and Executive Advisor for the IT Transfor- mation Group at CA Technologies. Greater agility is another benefit of the dynamic IT supply chain. "In the past, when the business wanted to move to a new market or develop a product, the cycle would take 18 to 24 months, which means they often missed the market or " The cloud's promise is to enable an enterprise to tap into global on-demand resources with better economics and highly specialized skill sets." —Leroy Williams VP of IT and Services | Ball Corp. PHOTOGRAPHY: COURTESY OF BALL CORPORATION 14 SMARTENTERPRISEMAG.COM

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