The 2010 FIFA World Cup begins today in South Africa - not that you could miss it with the blanket coverage across all media outlets. The tournament covers 32 teams, 64 matches, in 10 stadia, watched by 3.7 million spectators, as well as a worldwide TV audience measured in the billions. As a football fan I will be captivated with the spectacle and gripped by the drama as it unfolds in what has been described as the biggest show on earth. Magic indeed.
But, although the FIFA World Cup is large, it is certainly not the biggest show on earth. That title, as a sporting event, undoubtably goes to the Olympic Games. A simple comparison of the numbers involved explains the diffences between the 2010 South Africa FIFA World Cup and the London 2012 Olympic Games - 776 footballers (32 teams x 23 players each) versus 14,000 athletes, 11 stadia versus 94 venues, 32 teams versus 205 countries, 3.7 million spectators versus 10 million, etc., etc. In short, the London 2012 Olympic Games will be an order of magnitude bigger.
Most of us enjoy the spectacle, whether it is the World Cup or the Olympic Games (or both in my case). But bringing this spectacle to the billions of us watching from afar, the spectators in the stadia, and the paticipants is as much an information and communcations technology (ICT) challenge as any other. For example, the Games Management System (GMS) that will orchestrate the participants, events, and scoring is a mix of information technology (IT) and communications platforms and infrastructure. For this reason, we are writing a series of articles on the lead up to London 2012 to illustrate what enterprises can learn from this huge sporting event. The point is that ICT is as critical to the Olympic Games as it is to all enterprises (large and small).
On Monday, June 7th, AT&T will introduce two new smartphone data plans, which will replace the current $30/month unlimited data plan offer and will make smartphone data packages affordable to more customers. The DataPlus package does, indeed, lower the entry-level price for smartphone users. The DataPlus package costs $15 per month for 200 megabytes of data, with the option of purchasing an additional 200 megabytes of data for $15. Customers who are heavy data users can purchase the DataPro plan, which is a 2-gigabyte package for $25 per month. If customers go over this limit, an additional gigabyte of data costs $10. DataPro customers can also use their mobile devices as wireless modems to connect other devices (e.g., laptops) to the network for an additional $20 per month.
The net-net of these new packages is that customers using the DataPlus plan get a voice and data plan for $55 per month and customers on the DataPro plan pay $65 per month, compared with the current price of $70 per month. These price cuts will benefit the increasing number of employees who are responsible for paying for their own voice and data plans. Results from Forrester’s 2010 Enterprise And SMB Networks And Telecommunications Survey show that approximately 30% of over 1,000 surveyed enterprises have already cut the number of employees who qualify for corporate-liable mobile data and voice services, and 17% plan to cut the number of employees on corporate-liable voice and data services this year.
The next decade will represent the decade of management consulting innovation, as it's reached its local peak. Consulting service provider strategists are being forced to not only innovate their clients' businesses but their own businesses, too. Four trends are pushing service provider strategists to ignite innovation in 2010:
Convergence — of business and IT services markets. Service providers are looking for new routes to value for growing their business in their rapidly commoditizing markets. Because the business is becoming more and more intertwined with technology, and related decisions are moving up within client organizations, providers of all types are expanding their corresponding portfolios — either up or down the value chain — but with mixed success. However, this makes traditional provider labeling meaningless. Classical management consulting firms are eager to evolve their IT capabilities, accounting firms strive to be more than just another Big Four company, business and IT services players focus on new integrated services, and IT outsourcers are overhauling their business consulting units. At the same time, new entrants such as product vendors and cloud-native providers are entering the services market.
The choice between different formats of cloud computing (IaaS, SaaS mostly) and their comparison to internal IT business service deployment must be based on objective criteria. But this is mostly uncharted territory in IT. Many organizations have difficulties implementing a realistic chargeback solution, and the real cost of business services is often an elusive target. We all agree that IT needs a better form of financial management, even though 80% of organizations will consider it primarily as a means for understanding where to cut costs rather than a strategy to drive a better IT organization.
Financial management will help IT understand better its cost structure in all dimensions, but this is not enough to make an informed choice between a business service internal or external deployment. I think that the problem of which deployment model to choose from requires a new methodology that will get data from financial management. As I often do, I turned to manufacturing to see how they deal with this type of analysis and cost optimization. The starting point is of course an architectural model of the “product”, and this effectively shows how valuable these models are in IT. The two types of analysis, FAST (Function Analysis System Technique) and QFD (Quality Function Deployment), combine into a “Value Analysis Matrix” that lists the customer requirements against the way these requirements are answered by the “product” (or business service) components. Each of these components has a weight (derived from its correlation with the customer requirements) and a cost associated to it. Analyzing several models (for example a SaaS model against an internal deployment) would lead to not only an informed decision but also would open the door to an optimization of the service cost.
I think that such a methodology would complement a financial management product and help IT become more efficient.
I’ve been relatively quiet for a while – for two reasons: (1) I’ve been making the rounds, IBM PCTY in various countries, Forrester analyst days, client meetings, etc., and (2) I’ve been doing some serious research because I’ve decided that it is time to revisit my IT Financial Management report from last year. Why?
First of all because the market is really heating up. Every client conversation these days sooner or later turns to IT Financial Management in general and how to better understand and manage the IT budget specifically. Secondly, I’ve come to the conclusion that there is an adoption s-curve for IT financial management similar to the one for business service management that I published a few years ago. See the Implementing BSM report.
Here is what I am proposing:
And last but by no means least, a few vendors have started to take the next logical step – taking IT Financial Management to the cloud. This is important because Cloud Financial Management offers the critical information that allows businesses to accurately plan, budget and gain cost control over their cloud computing spend. This is a discipline that, we believe, will become essential as cloud computing in its various guises (public, virtual private and private clouds) begins to dominate the business world.
Stay tuned for an update on who’s playing in that market.