An exploration of themes around cloud, innovation and commoditisation in I.T. at E-Crime Symposium.

1. Situation normal,
everything must
change

2. Sccott Beale/Laughing Squid : http://www.flickr.com/photos/laughingsquid/

3. Pain

4. Pain
No. Slides

5. Pain 20 slides
OK
No. Slides

6. 246 slides
Severe
Pain
risk of
harm
OK
No. Slides

7. photos/videoplacebo/3481780379/

8. Cloud?

9. Note 1: Cloud computing is still an evolving paradigm. Its definitions, use cases, underlying technologies, issues, risks, and benefits will be refined in a spirited debate by the public and
private sectors. These definitions, attributes, and characteristics will evolve and change over time.
Note 2: The cloud computing industry represents a large ecosystem of many models, vendors, and market niches. This definition attempts to encompass all of the various cloud approaches.
Definition of Cloud Computing:
Cloud computing is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and
services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. This cloud model promotes availability and is composed of five essential
characteristics, three service models, and four deployment models.
Essential Characteristics:
On-demand self-service. A consumer can unilaterally provision computing capabilities, such as server time and network storage, as needed automatically without requiring human interaction
with each service’s provider.
Broad network access. Capabilities are available over the network and accessed through standard mechanisms that promote use by heterogeneous thin or thick client platforms (e.g., mobile
phones, laptops, and PDAs).
Resource pooling. The provider’s computing resources are pooled to serve multiple consumers using a multi-tenant model, with different physical and virtual resources dynamically assigned
and reassigned according to consumer demand. There is a sense of location independence in that the customer generally has no control or knowledge over the exact location of the provided
resources but may be able to specify location at a higher level of abstraction (e.g., country, state, or datacenter). Examples of resources include storage, processing, memory, network
bandwidth, and virtual machines.
Rapid elasticity. Capabilities can be rapidly and elastically provisioned, in some cases automatically, to quickly scale out and rapidly released to quickly scale in. To the consumer, the
capabilities available for provisioning often appear to be unlimited and can be purchased in any quantity at any time.
Measured Service. Cloud systems automatically control and optimize resource use by leveraging a metering capability at some level of abstraction appropriate to the type of service (e.g.,
storage, processing, bandwidth, and active user accounts). Resource usage can be monitored, controlled, and reported providing transparency for both the provider and consumer of the
utilized service.
Service Models:
Cloud Software as a Service (SaaS). The capability provided to the consumer is to use the provider’s applications running on a cloud infrastructure. The applications are accessible from
various client devices through a thin client interface such as a web browser (e.g., web-based email). The consumer does not manage or control the underlying cloud infrastructure including
network, servers, operating systems, storage, or even individual application capabilities, with the possible exception of limited user-specific application configuration settings.
Cloud Platform as a Service (PaaS). The capability provided to the consumer is to deploy onto the cloud infrastructure consumer-created or acquired applications created using programming
languages and tools supported by the provider. The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, or storage, but
has control over the deployed applications and possibly application hosting environment configurations.
Cloud Infrastructure as a Service (IaaS). The capability provided to the consumer is to provision processing, storage, networks, and other fundamental computing resources where the
consumer is able to deploy and run arbitrary software, which can include operating systems and applications. The consumer does not manage or control the underlying cloud infrastructure
but has control over operating systems, storage, deployed applications, and possibly limited control of select networking components (e.g., host firewalls).
Deployment Models:
Private cloud. The cloud infrastructure is operated solely for an organization. It may be managed by the organization or a third party and may exist on premise or off premise.
Community cloud. The cloud infrastructure is shared by several organizations and supports a specific community that has shared concerns (e.g., mission, security requirements, policy, and
compliance considerations). It may be managed by the organizations or a third party and may exist on premise or off premise.
Public cloud. The cloud infrastructure is made available to the general public or a large industry group and is owned by an organization selling cloud services.
Hybrid cloud. The cloud infrastructure is a composition of two or more clouds (private, community, or public) that remain unique entities but are bound together by standardized or
proprietary technology that enables data and application portability (e.g., cloud bursting for load-balancing between clouds).Note: Cloud software takes full advantage of the cloud paradigm
by being service oriented with a focus on statelessness, low coupling, modularity, and semantic interoperability.

10. Point 1
Cloud computing is
still an evolving
paradigm.

11. http://www.flickr.com/photos/rainbowproject/3928445074/

12. We don’t know
what “cloud” is yet.
http://www.flickr.com/photos/rainbowproject/3928445074/

13. “The real thing to do today is to capture,
what are the dimensions of the thing that
literally, I will tell you, we’re betting our
company on, and I think pretty much
everybody in the technology industry is
betting their companies on”
Microsoft CEO, Steve Ballmer

14. We don’t know
what “cloud” is yet
http://www.flickr.com/photos/rainbowproject/3928445074/

15. We don’t know
what “cloud” is yet
but bet your
company on it
http://www.flickr.com/photos/rainbowproject/3928445074/

16. We don’t know
what “cloud” is yet
but bet your
company on it
everybody else is.
http://www.flickr.com/photos/rainbowproject/3928445074/

17. “open up exciting new
prospects for the
employment of computers in
ways and on a scale that
would have seemed pure
fantasy only five year ago”

18. “The challenge of the
computer utility”
Douglas Parkhill
1966

19. http://www.flickr.com/photos/radioflyer007/ /upload.wikimedia.org/wikipedia/en/5/51/Metropolis.jpg
http:/

20. http://ftp.arl.army.mil/ftp/historic-computers/png/brlescII1.png

22. Computer Utility
Cloud Computing

23. Change

24. Change
Why now?

25. Change
Why now?
Benefits & Risk

26. Change
Why now?
Benefits & Risk
General

27. Change
Why now?
Benefits & Risk
General
Managing Change

28. Ubiquity

29. Ubiquity
Certainty

30. Ubiquity
TV’s, Phones &
VCRS
Certainty

31. Ubiquity
TV’s, Phones &
VCRS
Certainty

32. Ubiquity
Innovation
Certainty

33. Ubiquity
Commodity
Certainty

34. Ubiquity
Innovation of
early lists, 1980.
Certainty

35. Ubiquity
Custom built,
DB Marketing
Mid 80s
Certainty

36. Ubiquity
Product
Early 90s
Certainty

37. Utility Services
Ubiquity
of Salesforce
Certainty

38. Ubiquity
Utility Services
Commodity
Product
Custom built
Innovation
Certainty

39. Ubiquity
Innovation of Z3, 1941
Certainty

40. Ubiquity
Custom Built LEO, 1946
Certainty

41. Ubiquity
Products
IBM 650, 1954
Certainty

42. Ubiquity
Commodity
Hardware
Certainty

43. Utility services
Ubiquity
of Amazon EC2
Certainty

44. Ubiquity
Innovation of W. H.
Wollaston, 1821
Certainty

45. Ubiquity
Early Products,
Hippolyte Pixii, 1830s
Certainty

46. Utility Services
Ubiquity
of the National
Grid
Certainty

47. Electricity
Accounts
Ubiquity
Infrastructure Payroll
CRM
HR systems
ERP
Web Portal
Search Engines
Enterprise 2.0
Information
market
VRM
Certainty

48. Ubiquity
io n
at
it is
o d
m m
Co
Certainty

50. http://www.flickr.com/photos/privatenobby

51. http://www.flickr.com/photos/billege

52. http://www.flickr.com/photos/billege/

53. Ubiquity
Demand
(user competition)
Certainty

54. http://www.flickr.com/photos/privatenobby

55. http://www.flickr.com/photos/mush2274

56. http://www.flickr.com/photos/mush2274/

57. Ubiquity
Demand
(user competition)
Improvement
(supply competition)
Certainty

58. Ubiquity
Demand
(user competition)
io n
at
it is
o d
m m
Co
Improvement
(supply competition)
Certainty

59. Ubiquity
Certainty

60. Ubiquity
Certainty

61. Ubiquity
Widespread
(Demand)
Feature Complete
(Improvement)
Certainty

62. Ubiquity
Utility Services
Certainty

63. Application
Database Framework Messaging
Operating System
Virtualisation
CPU Memory I/O

64. Application
Framework Messaging
Operating System
Virtualisation
Memory I/O

65. Application
Framework Messaging
Operating System
Virtualisation Infrastructure
Memory I/O

66. Application
Framework Messaging Platform
Operating System
Virtualisation Infrastructure
Memory I/O

67. Application Software
Framework Messaging Platform
Operating System
Virtualisation Infrastructure
Memory I/O

68. Ubiquity
Software
... as a
Platform Service
Infrastructure
... as a
Product
Certainty

69. Change
Why now?

70. Concept

71. Concept
Suitability

72. Concept
? Technology
Suitability

73. Gerald J. Popek
(1947-2008)

74. Attitude
Concept
? Technology
Suitability

75. Paul Strassmann http://www.strassmann.com/

76. Nick Carr

77. Ubiquity
g
in ue
h l
is va
in c
im gi
D e
ra t
st
Certainty

79. Payroll
HR Systems
CRM
ERP
Sales Automation
Infrastructure
Finance & Accounting

80. Ubiquity
HR Payroll
Certainty

81. Ubiquity
HR Payroll
Why are we spending
$600M p.a. on customising
stuff has no strategic
value?
Certainty

82. Customise your payroll
system!
http://www.flickr.com/photos/rainbowproject/3928445074/

83. Ubiquity
Way back
when ...
Certainty

84. Ubiquity
Now
Way back
when ...
Certainty

85. Ubiquity
Standardised
Service!
Certainty

86. Ubiquity
Standardised
Service!
Marketplace
Certainty

87. Attitude
Concept Technology
Suitability

88. Ubiquity
Software
... as a
Platform Service
Infrastructure
... as a
Product
Certainty

89. Change
Why now?
Benefits & Risk

90. Ubiquity
Early Utility
Westinghouse,
1890s
Product
Hippolyte Pixii,
1830s
Certainty

91. Ubiquity
Economies of scale
(volume operations)
Certainty

92. Ubiquity
Economies of scale
(volume operations)
Focus on core
(outsource)
Certainty

93. Ubiquity
Economies of scale
(volume operations)
Focus on core
(outsource)
Pay per use
(utility)
Certainty

94. Ubiquity
Economies of scale
(volume operations)
Focus on core
(outsource)
Pay per use
(utility)
Certainty

95. Ubiquity
efficiency
Certainty

96. Ubiquity
Agility
(Self Service)
Certainty

97. Previous
Time
(mins)
New
server 72,000
64 node
130,000
cluster

98. Previous Cloud
Time Time
(mins) (mins)
New
server 72,000 7
64 node
130,000 15
cluster

99. Ubiquity
Agility
(Self Service)
Innovation
(creative destruction,
componentisation)
Certainty

100. The fundamental impulse
that sets and keeps the
capitalist engine in motion
comes from the new
consumers, goods, the new
methods of production or
transportation, the new
markets, the new forms of
industrial organization that
capitalist enterprise creates.
Joseph A. Schumpeter
(1883 - 1950)

101. The fundamental impulse
that sets and keeps the
capitalist engine in motion
comes from the new
consumers, goods, the new
methods of production or
transportation, the new
markets, the new forms of
industrial organization that
capitalist enterprise creates.
Joseph A. Schumpeter
(1883 - 1950)

102. Creative
Destruction
Joseph A. Schumpeter
(1883 - 1950)

103. Ubiquity
lu e
Va
in g
d
E ro
Certainty

104. Ubiquity
lu e
Va
in g
d
E ro Enables
Innovation
Certainty

105. Ubiquity
Internet
Electricity
Hardware
Certainty

106. Ubiquity
Internet
Electricity
Hardware
Enable
Innovation
Search
Certainty

107. Ubiquity
Software
Platform
Infrastructure
Enable
Innovation
Certainty

108. Theory of Hierarchy
Componentisation
Herbert A. Simon
(1916 - 2001)

109. Rate of evolution
of a system is
dependant upon
the organisation
of its subsystems.
Herbert A. Simon
(1916 - 2001)

110. Application

111. Application
Database Framework Messaging

112. Application
Database Framework Messaging
Operating System
Virtualisation
CPU Memory I/O

113. Application
Database Framework Messaging
Operating System
Virtualisation
CPU Memory I/O

114. Application
Orders of
Magnitude
CPU

115. Ubiquity
Software
Platform
Infrastructure
Accelerated
Innovation
Certainty

117. Henry Maudslay
(1771 - 1831)

118. Ubiquity
Agility
(Self Service)
Innovation
(creative destruction,
componentisation)
Opportunity
(long tail, co-evolution,
price elasticity)
Certainty

119. Importance
Limit of IT
Projects

120. Importance
Limit of IT
demand
(backlog)
Projects

121. Price
!P
!Q
Quantity

122. Ubiquity
Innovation
Flemming Valve, 1904
Certainty

123. Ubiquity
Products
Intel 4004,
2300 Transistors, 1971
Certainty

124. Busicom

125. Busicom
MCS-4

126. Busicom
Co-Evolution
MCS-4

127. > 1,000,000,000,000,000,000

128. Ubiquity
Agility
(Self Service)
Innovation
(creative destruction,
componentisation)
Opportunity
(long tail, co-evolution,
price elasticity)
Certainty

129. Ubiquity
consumption
Certainty

130. It’ll reduce your
IT spend.
http://www.flickr.com/photos/rainbowproject/3928445074/

131. consumption
efficiency

132. “Jevons Paradox”
Technological progress
that increases the
efficiency with which a
resource is used, tends to
increase the rate of
consumption of that
resource.
William Stanley
Jevons, 1865

133. Choice?

134. Ubiquity
Market
You
Certainty

135. Ubiquity
Market
Competitive
Gap
You
Certainty

136. Ubiquity
Market
Pay per use
Focus on core
Economies of scale
Speed to market
Accelerated innovation
You
Certainty

137. Ubiquity
Market
ure
ss
Pre
You
Certainty

138. Ubiquity
Market
ure
ss
Pre
You
Prof. Van Valen
“Red Queen Hypothesis”
Certainty

139. “Red Queen Hypothesis”
The need to constantly
evolve in order to stand
still relative to a
surrounding ecosystem
Prof. Van Valen

140. http://www.flickr.com/photos/privatenobby

141. http://www.flickr.com/photos/billege

142. http://www.flickr.com/photos/giddygoose/

143. No Choice?

144. Ubiquity
Marketplace
Certainty

145. Ubiquity
Private
Marketplace
Certainty

146. Ubiquity
Hybrid
Certainty

147. Ubiquity
Transition
Confusion
Governance
Trust
Security
Transparency
Certainty

148. Ubiquity
Transition Outsourcing
Confusion Suitability
Governance Competition
Trust Lock-in
Security Second Source
Transparency Control
Certainty

149. Ubiquity
Transitional Risks
Security of supply,
governance, trust ...
Hybrid
Certainty

150. Ubiquity
Certainty

151. Only public cloud is
cloud computing!
http://www.flickr.com/photos/rainbowproject/3928445074/

152. Benefits vs Risks

153. Recap

154. Ubiquity
Software
... as a
Platform Service
Infrastructure
... as a
Product
Certainty

155. Attitude
Concept Technology
Suitability

156. Ubiquity
Software
Platform
Infrastructure
Accelerated
Innovation
Certainty

157. Ubiquity
Transition Outsourcing
Confusion Suitability
Governance Competition
Trust Lock-in
Security Second Source
Transparency Control
Certainty

158. Ubiquity
Market
ure
ss
Pre
You
Prof. Van Valen
“Red Queen Hypothesis”
Certainty

159. http://www.flickr.com/photos/privatenobby

160. Ubiquity
Hybrid
Certainty

161. Benefits vs Risks

162. Change
Why now?
Benefits & Risk
General

163. Ubiquity
IT
Certainty

164. Ubiquity
Certainty

165. Ubiquity
Infrastructure
Certainty

166. Ubiquity
Infrastructure
Collective Enables
Intelligence
Certainty

167. Ubiquity
provided as ..
built on ...
Certainty

168. Ubiquity
Certainty

169. Ubiquity
Hybrid
Certainty

172. Data
Code

173. Data
Code

175. Proprietary Open Source

176. TCO
Proprietary Open Source

177. Exit
Proprietary Open Source

178. Minimise future costs
defacto public standard
open source implementation

179. Change
Why now?
Benefits & Risk
General
Managing Change

180. Electricity
Accounts
Ubiquity
Infrastructure Payroll
CRM
HR systems
ERP
Web Portal
Search Engines
Enterprise 2.0
Information
market
VRM
Certainty

181. Electricity
Accounts
Ubiquity
Infrastructure Payroll
CRM
HR systems
ERP
Web Portal
Search Engines
Enterprise 2.0
Information
market
VRM
Certainty

182. Lifecycle

183. #
Lifecycle

184. #
Lifecycle

185. Electricity
#
Infrastructure
Payroll
CRM
HR systems
Lifecycle

186. #
Enterprise 2.0
Information market
VRM
Lifecycle

187. #
Commoditisation
Demand vs Suppply Competition
Co-evolution
Lifecycle

188. #
Commoditisation
Demand vs Suppply Competition
Co-evolution
Innovation
Creative Destruction
Componentisation
Lifecycle

189. #
Lifecycle

190. #
Dynamic
Lifecycle

191. #
Dynamic
Deviation
Lifecycle

192. #
Dynamic
Deviation
Uncertain
Lifecycle

193. #
Dynamic
Deviation
Uncertain
Emergent
Lifecycle

194. #
Dynamic
Deviation
Uncertain
Emergent
Serendipty
Lifecycle

195. #
Dynamic
Deviation
Uncertain
Emergent
Serendipty
Competive Adv.
Lifecycle

196. #
Chaotic
Dynamic
Deviation
Uncertain
Emergent
Serendipty
Competive Adv.
Lifecycle

197. #
Chaotic Linear
Dynamic
Deviation
Uncertain
Emergent
Serendipty
Competive Adv.
Lifecycle

198. #
Chaotic Linear
Dynamic Repeatable
Deviation
Uncertain
Emergent
Serendipty
Competive Adv.
Lifecycle

199. #
Chaotic Linear
Dynamic Repeatable
Deviation Standardised
Uncertain
Emergent
Serendipty
Competive Adv.
Lifecycle

200. #
Chaotic Linear
Dynamic Repeatable
Deviation Standardised
Uncertain Known
Emergent
Serendipty
Competive Adv.
Lifecycle

201. #
Chaotic Linear
Dynamic Repeatable
Deviation Standardised
Uncertain Known
Emergent Predictable
Serendipty
Competive Adv.
Lifecycle

202. #
Chaotic Linear
Dynamic Repeatable
Deviation Standardised
Uncertain Known
Emergent Predictable
Serendipty Procedural
Competive Adv.
Lifecycle

203. #
Chaotic Linear
Dynamic Repeatable
Deviation Standardised
Uncertain Known
Emergent Predictable
Serendipty Procedural
Competive Adv. CODB
Lifecycle

204. #
Chaotic Linear
Dynamic Repeatable
Deviation Standardised
Uncertain Known
Emergent Predictable
Serendipty Procedural
Competive Adv. CODB
Lifecycle

205. #
Chaotic Linear
Innovation of Utility Services
early lists, 1980. of Salesforce
Lifecycle

206. Use Six Sigma!
http://www.flickr.com/photos/rainbowproject/3928445074/

207. #
Six Sigma
Lifecycle

208. #
Six Sigma
Repeatable
Standardised
Known
Predictable
Lifecycle

209. #
Six Sigma
Dynamic
Deviation
Uncertain
Emergent
Lifecycle

210. Use Six Sigma!
No! Use Agile!
http://www.flickr.com/photos/rainbowproject/3928445074/

211. #
Agile
Dynamic
Deviation
Uncertain
Emergent
Lifecycle

212. #
Agile
Repeatable
Standardised
Known
Predictable
Lifecycle

213. #
No Magic
Bullet
Lifecycle

214. #
Joseph A. Schumpeter
(1883 - 1950)
Lifecycle

215. #
Joseph A. Schumpeter Prof. Van Valen
(1883 - 1950)
Lifecycle

216. Innovation Paradox
Survival today requires ‘coherence,
coordination and stability’.
Survival tomorrow requires the
replacement of these erstwhile virtues.
Salaman & Storey

217. One Size fits all!
http://www.flickr.com/photos/rainbowproject/3928445074/

218. Ubiquity
Utility Services
Commodity
Product
Custom built
Innovation
Certainty

219. #
Lifecycle

220. #
Six Sigma
Lifecycle

221. #
Lifecycle

222. #
Outsource
Lifecycle

223. #
Why are we spending
$600M p.a. on customising
stuff has no strategic
value?
Lifecycle

224. #
Software
Platform
Infrastructure
Lifecycle

225. #
Software
Platform
Infrastructure
Innovation
Lifecycle

226. #
“Built on” “Provided as”
Lifecycle

227. http://www.flickr.com/photos/rednuht/479370088

228. http://www.flickr.com/photos/rednuht/479370088

229. http://www.flickr.com/photos/fatdeeman/2879894647

230. http://www.flickr.com/photos/fatdeeman/2879894647

231. http://www.flickr.com/photos/privatenobby

232. http://www.flickr.com/photos/8078381@N03/3979391704/

233. Recap

234. Ubiquity
Software
... as a
Platform Service
Infrastructure
... as a
Product
Certainty

235. Attitude
Concept Technology
Suitability

236. Ubiquity
Software
Platform
Infrastructure
Accelerated
Innovation
Certainty

237. Ubiquity
Transition Outsourcing
Confusion Suitability
Governance Competition
Trust Lock-in
Security Second Source
Transparency Control
Certainty

238. consumption
efficiency

239. Ubiquity
Market
ure
ss
Pre
You
Prof. Van Valen
“Red Queen Hypothesis”
Certainty

240. http://www.flickr.com/photos/privatenobby

241. Ubiquity
Hybrid
Certainty

242. Benefits vs Risks

243. Minimise future costs
defacto public standard
open source implementation

244. #
“Built on” “Provided as”
Lifecycle

245. http://www.flickr.com/photos/rednuht/479370088

246. #
Commoditisation
Demand vs Suppply Competition
Co-evolution
Innovation
Creative Destruction
Componentisation
Lifecycle

247. 2010 Study Tour – Surf the Change or Be Swept
Away – Consumerization, Mobility, and the Cloud
The annual LEF EP Study Tour this year will focus on the rapid evolution of
IT consumerization – In terms of driving business change
Some Key Questions To Be Addressed
• How do we treat IT-savvy employees and customers
– in terms of their technology decision rights?
• How do we promote business value add in terms of
social networking tool usage? – without “heavy
handed “ IT governance?
• What information sharing rules need to be changed
in an era of increased external collaboration?
• How do we make it easier for staff to leverage cloud
computing services? – while maintaining enterprise
discipline around security and risk?
17 – 22 October 2010
San Francisco, USA
For more information, visit: http://
lef.csc.com/events/studytour
Leading Edge Forum 06/08/10 02:53 AM