As the saying goes, “If you’re not different from your competition, by definition you can’t be better.” IT infrastructure and operations (I&O) leaders should take this to heart.
In 2012, we enter the "the age of the customer" where increased global competition combined with technology-led disruption erodes traditional competitive barriers across all industries. At the same time, it's easier than ever for empowered employees and application developers to circumvent the I&O group to take advantage of new desktop, mobile, and tablet devices as well as cloud-based software and infrastructure you don’t support. They're creating their own "greenfield" environments without your help.
It's time for I&O leaders to do things differently. This starts by dispelling the notion that greenfield opportunities require significant financial investment and organizational change or are limited to startups and build-outs in emerging markets. Greenfield opportunities present themselves in every corner of even the most established and mature businesses, and those greenfields can be small, iterative, and agile.
This year, we will dedicate Forrester's Infrastructure & Operations Forums to the theme of "Leapfrog Your Global Competition: Design Your Greenfield Infrastructure Today." Join us May 24 to 25 in Las Vegas and June 19 to 20 in Paris as we tackle everything you need to capitalize on your greenfield opportunities of every scale across data center, desktop, mobile, and IT operations environments.
Whether or not IT Infrastructure and Operations (I&O) leaders believe they are well-positioned to support customer growth, the business does. Their expectations are high, and they firmly believe that technology's ability to serve and support customers is most valuable, even more so than cost savings. To deliver on these ambitions, I&O leaders must follow suit and build a customer-obsessed organization that takes an outside-in view from the customer's perspective — not inside-out from the data center.
While this transformation will be anything but easy, there are invaluable lessons to be learned from those who have already taken on the challenge of rebooting their people, process, and technology to become more customer-centric. Lessons from companies like Fidelity, where Wilson D’Souza, Senior VP of End User Computing, and George Brady, Executive VP of Distributing Hosting For Fidelity Technology Group, have applied these “rebooting” principles to improve associate experience. In preparation for their upcoming keynote at next week’s Infrastructure & Operations Forum, I recently spoke with Wilson and George about the importance of building customer-centric infrastructure:
Why is the concept of "customer-centricity" so important to Fidelity's business?
Serving our customers has been at the core of Fidelity’s business since our founding 65 years ago. Our goal is to provide the best customer experience and outcomes in our industry. We believe that customer experience results achieved are a function of the technology environment we provide our associates.
About five months ago, I “broke up” with T-Mobile in favor of AT&T. I was a T-Mobile customer for six years on a very competitive service plan. But none of that mattered; I wanted an iPhone, and T-Mobile couldn’t give it to me. It was a clean but cruel breakup: AT&T cancelled my T-Mobile contract on my behalf, the equivalent of getting dumped by your girlfriend’s new boyfriend.
I bring this up because it reminds me of the saying: “If we don’t take care of our customers, someone else will.” This is particularly important to remember in “The Age Of The Customer” where technology-led disruption is eroding traditional competitive barriers across all industries. Empowered buyers have information at their fingertips to check a price, read a product review, or ask for advice from a friend right from the screen of their smartphone.
This is affecting your IT just as much as your business: As an indicator, Forrester finds that 48% of information workers already buy whatever smartphone they want and use it for work purposes. In the new era, it is easier than ever for empowered employees and App Developers to circumvent traditional IT procurement and provisioning to take advantage of new desktop, mobile, and tablet devices as well as cloud-based software and infrastructure you don’t support. They’re “cheating” on you to get their jobs done better, faster, and cheaper.
To become more desirable to your customer – be it your Application Developers, workforce, or end buyers – IT Infrastructure and Operations leaders must become more customer-obsessed, which I talk about in this video:
Yes, but you must adapt by demonstrating your ability to drive business growth and differentiation, not just cost savings and uptime. Here’s a personal example of a much broader trend as to why this is so important to your business and your role as an I&O professional:
It’s a cool Autumn day, which reminds me I need a new jacket. I walk into Patagonia. I evaluate several models and then buy one – but not from Patagonia. It turns out a competitor located two miles away is offering the jacket at a discount. How did I know this? I scanned the product's bar code using the RedLaser app on my iPhone, which displayed several local retailers with lower prices. If I had been willing to wait three days for shipping, I could have purchased that same jacket while standing in Patagonia from an online retailer with an even better deal. [Truth be told: I actually bought the jacket from Patagonia's store after validating no better deals existed… but The Home Depot wasn’t so lucky this summer when I bought the same, but cheaper air conditioner from Amazon while standing in aisle 4.]
This is a prime example of what Forrester calls the “The Age Of The Customer” where empowered buyers have information at their fingertips to check a price, read a product review, or ask for advice from a friend right from the screen of their smartphone. This type of technology-led disruption is eroding traditional competitive barriers across all industries; manufacturing strength, distribution power, and information mastery can't save you.
Consider the following scenario: It’s a hot summer day and a prospective customer walks into your store to buy an air conditioner. He evaluates several models and then buys one — but not from you. It turns out your competitor located two miles away is offering the same model at a 20% discount. How did he know this? He scanned the product's bar code using the RedLaser app on his iPhone, which displayed several local retailers with lower prices than yours. If he had been willing to wait three days for shipping, he could have purchased the exact same model while standing in your store from an online retailer at a 30% discount.
This type of technology-fueled disruption is affecting all industries, not just retailers. Since the early 1900s, businesses relied on competitive barriers such as manufacturing strength, distribution power, and information mastery. But this is all changing in the age of the customer, where empowered buyers have information at their fingertips to check a price, read a product review, or ask for advice from a friend right from the screen of their smartphone.
To compete in the age of the customer, your business must become customer-obsessed. As Forrester’s Josh Bernoff (@jbernoff), SVP of Idea Development and author of Groundswelland Empowered, advocates in his latest research: “The only source of competitive advantage is the one that can survive technology-fueled disruption — an obsession with understanding, delighting, connecting with, and serving customers.”
Cash-starved. Fast-paced. Understaffed. Late nights. T-shirts. Jeans.
These descriptors are just as relevant to emerging tech startups as they are to the typical enterprise IT infrastructure and operations (I&O) department. And to improve customer focus and develop new skills, I&O professionals should apply a “startup” mentality.
A few weeks ago, I had the opportunity to spend time with Locately, a four-person Boston-based startup putting a unique spin on customer insights and analytics: Location. By having consumers opt-in to Locately’s mobile application, media companies and brands can understand how their customers spend their time and where they go. Layered with other contextual information – such as purchases, time, and property identifiers (e.g. store names, train stops) – marketers and strategists can drive revenues and awareness, for example, by optimizing their marketing and advertising tactics or retail store placement.
The purpose of my visit to Locately was not to write this blog post, at least not initially. It was to give the team of five Research Associates that I manage exposure to a different type of technology organization than they usually have access to – the emerging tech startup. Throughout our discussion with Locately, it struck me that I&O organizations share a number of similarities with startups. In particular, here are two entrepreneurial characteristics that I&O professionals should embody in their own organizations:
Despite its networking roots, today’s Interop events have evolved to address an expansive range of IT roles, responsibilities and topics. While networking managers will still feel at home in the networking track, Interop addresses a variety of themes very relevant to the broader interests of IT Infrastructure & Operations (I&O) professionals, like cloud computing, virtualization, storage, wireless and mobility, and IT management.
IT professionals responsible for the “I” (or Infrastructure) in I&O will find the event particularly relevant. So much so that Forrester has partnered with Interop to develop track agendas, identify speakers, moderate panels, and even present. For the last two years, I have chaired the Data Center and Green IT tracks at Interop’s Las Vegas and New York events. And I am doing the same this year at Interop New York 2010 from October 18th to 22nd.
Yesterday, I participated in one of the regular content planning sessions for us analysts on Forrester’s IT Infrastructure & Operation’s Research team. Similar to investment managers and their portfolio of stocks or bonds, we spent time making buy/hold/sell decisions on what we will research more, continue to research, or stop researching. Among the many criteria we use to make these decisions, like client readership, inquiries, or consulting, the strategic relevancy to IT is an important factor to consider. And there was some heated debate around research themes we may phase out down the road…
Enter the discussion on IT asset disposition – or the process of reselling, donating, or recycling end-of-life IT equipment. While every organization eventually has to dispose of its end-of-life IT equipment, it’s long been an afterthought. And the data backs this up. Forrester finds that 80% of organizations globally use their OEM, third parties or a combination of the two for IT asset disposition. But when asked how important IT asset disposition is relative to other IT asset management processes, it’s far and away the least important. As an indicator of this, I recently surveyed over 300 European IT professionals where 77% of respondents ranked IT asset disposition “less important” or “least important.”
This begs the question, is disposing of end-of-life IT equipment really strategic?
I recently recorded a podcast with GlaxoSmithKline (GSK), the global pharmaceutical company, and their success story of implementing a PC power management initiative that is expected to cut energy costs by ~$1 million per year. While these savings alone should impress any IT executive – especially IT infrastructure and operations professionals who manage PCs – what I found so unique about their story came through my conversation with Matt Bartow, business analyst in GSK’s research and development IT organization, who led this initiative. In particular, GSK is a great example of how “empowering” staff to innovate can industrialize IT operations leading to significant cost savings andgreen IT benefits.
GSK’s success with PC power management is an outcome of the inspired management style advocated in Forrester’s upcoming book, Empowered. By proactively calling on their employees to spur innovation, GSK tapped into one of their greatest inventive resources – staff, like Matt Bartow, who Forrester would consider a highly empowered and resourceful operative (HERO). But as Empowered explains, HEROes can’t succeed without support from management. By initiating the innovation challenge, GSK’s IT leadership not only identified HEROes in their organization but sourced innovative ideas at the same time. From there, the use of social media technology – in this case, using a wiki-type website with voting capabilities – made it simple for GSK staff to participate while giving them a “say” in the selection process.
So how exactly did PC power management become an IT priority at GSK?
As green IT plans persist through 2010, I'm starting to receive questions from IT infrastructure and operations professionals — particularly data center managers — about the use of cleaner energy sources (e.g. wind, solar, fuel cells, hydro) to power their data center facilities. So when Google recently announced its purchase of 114 megawatts of wind power capacity for the next 20 years from a wind farm in Iowa, I got excited, hopeful of a credible example I could refer to.
But as it turns out, Google will not be using this wind energy to power its data centers. . . yet. Despite Google stating that the wind capacity is enough to power several data centers, their Senior Vice President of Operations, Urs Hoelzle, explains that, "We cannot use this energy directly, so we're reselling it back to the grid in the regional spot market." I confirmed this in electronic conversations with two other industry insiders, Martin LaMonica (CNET News) and Lora Kolodny (GreenTech), who also covered the announcement.
And it's unfortunate since Google's $600 million data center in Council Bluffs, Iowa could likely benefit from the greener, and possibly cheaper, wind energy. But Iowa is a large state and it's likely that distribution of the wind energy is an issue since the Council Bluffs data center appears to be well over a 100 miles away from their wind farms several counties away.