Industry news

You know my method. It is founded upon the observation of trifles,” said Sherlock Holmes. And maybe surprisingly, the Victorian sleuth is a lucid commentator on a major outsourcing trend for 2012: Business Analytics.

Analytics is a singular topic at the forefront of every CIO’s mind at the moment. According to the Gartner CIO Agenda survey, it is the number one technology - ahead of mobile at number two, and cloud at three - that CIOs see as their priority in 2012.

Becoming an intelligent business is the only way to truly know where you are at: having a strong grip on understanding your processes is the route to controlling them, and of course, manipulating them to best advantage. This is especially pertinent when under the cosh for a fast decision; having proper business intelligence in place is certainly the best way to circumnavigate a disaster.

At least you’d see it coming, and be able to plan for it. According to a whitepaper I read by Dan Burrows on sourcingfocus.com, “management information analyses only ‘out-of-band’ occurrences; in other words, always reporting by exception. The information delivered is accurate, available in the form required and available when required; preferably delivered to key consumers, rather than extracted on request."

Makes perfect sense. Monitoring the horizon for potential problems, rather than relying on guesswork / soothsaying / outsourcer’s intuition…like Sherlock always says: “It is a capital mistake to theorize before one has data.” Sherlock never guesses, he never assumes, he never “insensibly begins to twist facts to suit theories, instead of theories to suit facts.”

But additionally to merely exception reporting, true contemporary analytics fills your business with the earliest, most accurate management information. It is therefore, your best hope of emulating the master detective, and working out the solution from a disparate array of clues.

For that is the ultimate aim of business intelligence: to mimic the human brain, and get the whole organisation thinking as one. For non-intelligent businesses, too much information is stored ‘up top,’ in various different minds around the company. Sometimes with questionable accuracy, sometimes in disagreement…

“Any truth is better than indefinite doubt,” is another of Sherlock’s musings. This correlates with Dan Burrows’ whitepaper, when he says another aspect of the infinite power of BI is, having “only one version of the truth.” He advocates “single source forms the basis for all reporting, whether by dashboard or scorecard, static report or data-discovery tool. Its structure supports intuitive drill-downs and the more complex ‘slice ‘n dice’ capabilities.”

The methodology of which Sherlock might describe as: “balance probabilities and choose the most likely. It is the scientific use of the imagination.” That is Holmes’ stock in trade. If you are an intelligent business, it will be yours too. Keeping a scrutinous eye on the tiniest events - after all, “there is nothing so important as trifles” - to drive the way to success in the momentous ones. That’s what BI delivers. Deduction with a higher powered mind. Just like the master detective himself. In the words of Sherlock Holmes: “Education never ends Watson. It is a series of lessons with the greatest for the last.”

Thanks to Dan Burrows of Waterstons, and of course, Sir Arthur Conan Doyle, for the inspiration for this blog.

The cost of the IT hardware and expertise involved in operating an in-house infrastructure, a full suite of applications and multiple business-critical processes is significant. Many companies have turned to outsourcing for cost saving, but every penny will be scrutinised for the value it provides and to ensure it is justified in terms of business need.

The difficulty that many CIOs face is that these assessments are not simple to make. They may be in control of very sophisticated IT strategies, but be in a position where they do not have suitably innovative service providers to deliver on them. The reason for this is that many outsourcers built their businesses by being effective in Business Process Outsourcing (BPO), Infrastructure or applications – but not in all of them.

However, this single-service approach does not easily allow CIOs to tailor an outsourcing strategy to their specific needs. Many CIOs have been forced to work with a range of different suppliers: one for application development, one for Infrastructure Outsourcing (ITO) and another for BPO.

While this represented the best approach at the time, it also led to a heavily siloed operation. With no data sharing or consistent management between these suppliers, inconsistencies and inefficiencies werecommonplace and cost effectiveness was low.

There are four areas in which an integrated approach tooutsourcing can enhance the business case for a CIO.

Speed and Agility

An integrated outsourcing offering enables an organisation to be quicker and more flexible in reacting to changes in the business environment. This means that opportunities are not missed because of failing systems and the company has the tools it needs to do its job at its disposal, at all times.

Business Oriented

Because everything is under one roof, there is greater coordination to steer the whole IT outsourcing project towards the CIO’s business goals. When functions are separate it’s a greater administrative burden to align resources in the same way.

SLA flexibility

With everything in the same place resources can be coordinated to meet more functional operational targets. With visibility and consistency of contracts the CIO can have a far easier path to navigate through operational responsibilities.

Common Governance

All employees are integrated and have a common governance process. Applications developers spend time with the BPO specialists to understand the systems and go back and improve them. If a call centre agent gets any application or server complaints thisimmediately reaches their colleagues in Applications or ITO and is fixed far more rapidly. This cuts turn around time and ensures minimal disruption for the client.

Cost efficiency

There are, of course, some economies of scale by working with a single provider, but the real cost benefits come through the efficiency savings that an integrated outsourcer will provide as standard.

It vital to success that CIOs in any industry have the ability to tailor IT services to the needs of their business. This is the case whether they own or outsource the hardware and services or not. However, the Total Cost of Ownership benefits of outsourcing – together with the fact that an integrated services offering and highly skilled offshore workforce can create a highlyeffective IT department – means that the difficult decision making just got a little easier.

Despite the tough marketplace of the past quarter, numbers employed in Business & Professional Services grew (+10%) for a fourth quarter running, defying expectations of a decline (-11%). Firms expect headcount to continuing rising at a similar pace in the coming three months (a balance of +8%).

And the slowdown is not as rapid as previously predicted. Over the past three months business volumes declined at a slower pace (-11%) than had been expected (-20%). The decline in business values was more marked (-31%).

The February quarterly CBI Service Sector Survey was conducted between 30 January and 15 February, and covered 167 firms. Respondents are divided into Business & Professional Services, such as accountancy, legal and marketing firms, and Consumer Services, such as hotels, bars and restaurants, travel, and leisure.

Ian McCafferty, CBI Chief Economic Adviser, said: “Although volumes of business activity continued to worsen across the UK services sector in the past quarter compared with the previous quarter, there are some tentative signs that conditions may be levelling out. Firms providing business and professional services have seen business activity deteriorate, but not to the extent they had anticipated, and they too are expecting a more modest decline in the coming quarter.

“Business confidence remains fragile, and will continue to be so given the continuing uncertainty in the Eurozone. However, there are some signs that after the very sharp fall in confidence at the height of the crisis last autumn, sentiment is stabilising.”

56% of civil servants working in IT or commercial functions are unaware of their organisations position on the all-important Public Sector Network. The problem is worse is central government (69% are unaware) compared to local government (31% unaware).

The PSN is expected could save up to £130m a year in central government by 2014. Within three years, the government wants 80% of its four million PC users to be using the network.

Research by BT surveyed 1300 from a wide range of areas of the public sector, to ascertain whether the public sector is effectively moving towards creating a shared information and communications infrastructure.

The Food Standards Agency signed a £19m 5 year managed services deal that will see Capita supply IT services to five UK sites.

Capita will supply network infrastructure services, server, storage and desktop support.

A new report ‘Shopping in a Multichannel World’ by Shoppercentric, an independent agency specialising in shopper research, has revealed that only 13% of consumers used their mobile to buy something in the last month, with over 70% of those polled having doubts about security.

Reasons cited not to buy via mobile include 51% not feeling able to experience products effectively, 46% complaining of poor network coverage, and 71% didn’t think mobile was currently secure enough.

Salesforce.com has won its biggest deal ever – a contract worth at least $100 million with an as yet unnamed insurance provider.

CEO Mark Benioff has revealed. "I'm thrilled to announce that since the closing of the fourth quarter [on 31st January], we've already topped ourselves by signing our first ever nine-figure transaction in the opening days of Q1."

Integrating IT across its multiple brands has allowed Lloyds TSB to save £2bn.

After taking over Halifax Bank of Scotland’s operations in 2088, the new system went live in 2010. This involved the migration of some 30 million accounts.

“This was an immense exercise involving the migration of approximately 30 million customer accounts and these platforms will now provide the foundation for the Group’s transformation plans,” said an official statement.

Cloud computing host Rackspace is hiring. Already in 2012 it has hired 65 people in the UK. Now it is looking for 350 more, but is finding it a challenge to find people with “Linux skills and cloud operational experience.” This has resulted in importing staff – now 19 languages are spoken in its office.

Fabio Torlini, director at Rackspace, stated: “The cloud is still a new technology, with a lot built on the Linux platform. It’s a young market still.”

As a result, Rackspace is in talks with many universities, hiping to get specific cloud training onto the curriculum.

43% of senior finance professionals in the UK believe that the CIO role will merge with the CFO role, says a study by IT services provider Getronics.

17% of the finance professionals thought that the CIO role would disappear altogether, in the wake of the trend that 77% of CFOs have claimed greater responsibility for IT decisions in the last 12-24 months.