HOW CLOUD COMPUTING IS CHANGING ENTERPRISE TECH SAN FRANCISCO: Over the next few years, what happens to the several trillion dollars businesses spend on technology will be decided by executives like Jeff Allen. As big business hitches its computer systems to the latest technology wave, Allen and others will have the tricky job of ensuring that old systems work with the many new systems finding their way into his company. A lot of normal companies are struggling to stitch together lots of different software from different technology providers, said Allen, a marketing vice president at Standard Register, a specialty publishing and communications company in Dayton, Ohio. Eventually, he said, he will have to choose from only three or four big suppliers. Eventually. But not right now. Corporate technology buyers are looking at a menu of new and old technologies and names both familiar and obscure. Old-guard companies like Microsoft, Oracle, Dell and Hewlett-Packard have been joined by new names like Salesforce, Workday and NetSuite. Google and Amazon have corporate-computing services. And yet another group of upstarts is nipping at that newer generations heels, ready to provide easy-to-use apps like the ones consumers download to their smartphones. It is a confusing number of choices with big stakes: Who will you entrust with your most precious asset - data about you and your customers? There is a changing of the guard, said Paul Daugherty, chief technology officer at the consulting firm Accenture. Some of the new guys will get big, and some of them will get acquired. Customers are trying to structure things to take advantage of the changes, but its hard. The biggest driver of this change is cloud computing, where the software is based somewhere else and retrieved over the Internet. With cloud computing, upfront costs are usually much less and new versions of software appear as easily as an update on a smartphone, so the product is never out of date. Moving a company to cloud-computing services is also typically faster than old corporate software installations, which can take years and require the services of expensive consultants. But there are risks with this shift. There are fears that the old tech suppliers dont understand the new way of doing things and may be unable to help their customers enjoy the benefits of new technology, while the new companies may not have staying power. And making sense of it all and controlling this upgrade process can be confounding. We can do things a lot faster, because we arent bound by big software upgrades every two years, with lots of consultants, said Douglas Menefee, who runs corporate technology at the Schumacher Group, a Lafayette, La., company that manages 3,000 emergency room physicians across the country. There are lots of pain points, too, though - too many products from different providers. This shift to a new generation from the corporate technology suppliers that grew in the 90s has been years in the making, but it has accelerated in recent months as companies like Dell, Hewlett-Packard and even Microsoft have struggled. Just as consumers are moving away from buying music and movies toward monthly subscriptions, corporate tech buyers are moving away from owning the technology outright and are instead asking others to do it for them in return for a monthly or annual fee. Amazon and Google have built enormous global clouds to capitalize on this change, and they are angling to pick up the computing loads companies used to do on their own servers, at a fraction of the cost. The most lasting legacy of Steve Ballmer, chief executive of Microsoft, who recently announced his retirement, might be the cloud service built under his watch called Azure, to better compete in this new environment. The worst hand right now seems to be held by hardware makers. More companies allow employees to bring in whatever smartphone, laptop or tablet they want, since they all connect to a cloud. We have HP hardware, but its not a strategic priority, said Allen, who uses a Samsung smartphone and an Apple iPad. Nokia, which could not compete with Apple and Google in smartphones, sold its handset unit to Microsoft last month for $7.2 billion. On Friday, BlackBerry, another device company in trouble, announced that it would lay off 4,500 employees. It is unlikely that many of the big companies will go away soon, of course. They still have deep pockets that allow them to buy into the new wave of corporate computing. Oracle, for example, has spent $4.3 billion just on three cloud-software companies, and it has made other acquisitions and conducted internal research and development that probably add up to much more. Were all going to have to learn new capabilities, said Mark V Hurd, a co-president at Oracle, which is the largest business software company. On Monday, Oracle will bring 60,000 customers to San Francisco to hear about its cloud strategy, which includes putting all of its apps in the cloud, allowing people to write new software on Oracles cloud and adding social media features to its products. Hurds plan is to bring customers over slowly, offering a bridge from the systems they know to the new world they must learn. All the customers want to hear how youre going to save them money and time and how youre going to help them innovate, he said. Up to now, that innovation has largely been happening at smaller companies, and that has given them a beachhead they will not easily give up. Menefees company, for example, used to work with products from Microsoft and Oracle, but it now relies on Salesforce, Workday and Amazon. I went up to Microsoft, and I can see theyve got religion now. They are a giant that has awoken, he said. But now Ive got loyalty to Salesforce and Amazon, so theyll have to exceed them. While the tech choices are daunting right now, some consolidation - or at least a more unified face - may be starting. Last week, Salesforce and Workday announced an alliance aimed at making their products operate better together, with customer data moving between their services. Workday has announced data-analysis services that make moves toward the kind of big data work Oracle does, while also consolidating information it can take from other companies products. Analytics is unifying, said Dan Beck, Workdays vice president for financials and analytics. Were in the trenches with the customers in a way the incumbents just dont get. Amazon has introduced a trusted adviser program that inspects a companys use of Amazon Web Services, its cloud service, and suggests ways it can be better used. Google has expanded its corporate cloud strategy, enlisting more developers and selling new ways for companies analyze data. Big data is sold as a way to build efficiency and gain insights. But big data services are also a way to consolidate data for customers. If you control information, you are almost by default the trusted partner, or what is known in the business as the single throat to choke if something goes wrong. Allen says that the app exchanges, where companies can now buy software the way people buy games and videos from an app store, may also help retain customers. Once you have a significant amount of data in someones platform, you lock yourself in pretty quickly, he said. They want you to use their apps, because they are looking for stickiness. originally posted on timesofindia.indiatimes
Posted on: Mon, 21 Oct 2013 04:03:09 +0000
Recently Viewed Topics
© 2015