Industry news

Researchers from Imperial College London are embarking on a programme to transform the way that our cities are used. They are investigating how digital technologies can boost the capabilities of the energy, health, transport and utility resources in our cities, so that they can run as effectively as possible.

Managing peak demand in supermarkets, a case study

A supermarket is one example of where the best use of digital technology can make something run as efficiently as possible and limit the waste of resources.

There could be a model for the best times for deliveries to arrive, so that they can avoid peak traffic congestion as well as arriving at a sensible time to meet peak customer demand for particular products.

Tracking where a delivery is in traffic could also help with planning the use of refrigerators or ovens that might be needed once that delivery arrives and make sure that power is only being used when it is required.

In addition, location based information about how many users are converging on a store could help identify the times when that store will need to have all its systems running and the times when energy use can be reduced.

Looking at the overall picture could mean resource usage is balanced in a way that generates real value for the supermarket operator, while conserving resources for other users in the city as a result.

Through the Digital City Exchange programme, funded with a £5.9m grant from Research Councils UK, the researchers intend to better the use and planning of cities by collecting appropriate data and conducting analysis at a systemic level.

Most cities have grown up without strategic planning. For example, Victorian sewers service state-of-the-art hospitals, and intelligent cars use roads with very simple and limited capabilities.

Since the beginning of the economic downturn, many CIOs have been looking at transforming their IT infrastructure as the most efficient means of driving cost savings. Cloud computing has evolved alongside the downturn at an incredibly fast pace, and it has proved to be a popular outsourcing avenue for SMBs to take, avoiding the consumption of critical internal resources. Cloud, SaaS and utility computing models mean organisations can rid themselves of their IT assets without having to acquire any expensive and burdensome hardware.

The complex mix of computing infrastructure created when adopting cloud means organisations have significant overheads in managing infrastructures and are likely to suffer serious technical issues if they fail to manage it properly. Recent cloud management research revealed that two thirds of enterprises are not adopting cloud computing because the infrastructure management is too complex.

Without doubt cloud computing is the future for both SMB and enterprise businesses however, there are still many barriers to adoption. To overcome this, businesses should deploy self-healing, self-learning cloud management systems to effectively control multiple infrastructures, including private, public or hybrid cloud with less down time and improved service levels. The correct automation tool will also allow IT teams to automatically set a range of resource thresholds, enabling easy and controlled use of the cloud. Problem identification, balancing server loads and network management and reporting are prime candidates for automation.

Once businesses wake up to the fact that up to 90% of low level IT support functions can be removed from human hands, maybe outsourcing to the cloud will be as popular amongst larger enterprises as it is amongst SMBs.

Outsourcing is a hot topic in the public sector with more and more areas like the NHS, police force and local councils all using external suppliers to improve their businesses. But with the significant cuts in central and local government funding, outsourcing strategies are coming under the spotlight.

The intense focus on cost cutting and becoming more agile over the last year and a half has forced procurement teams closer to most parts of the business than they ever have been. In addition, keeping positive relationships with suppliers has been a challenge for CPOs with limited access to cash flow due to economic uncertainty.

With this in mind, in order for the public sector to benefit and make outsourcing work effectively there are a few steps which need to be considered, such as planning, risk analysis and the biggest issue, overcoming funding barriers. Aligning an outsourcing strategy with the procurement team will no doubt solve these issues, but in turn, will almost certainly cause some friction as different perspectives and procedures clash. However, there are a few steps which can reduce these headaches on both sides of the table.

The Three-Step Approach

Re-thinking a procurement strategy to align better with supplier choice is always a disruptive process and many stakeholders outside the procurement function may question why this should happen and why they cannot choose their own suppliers. In this instance it is important to communicate how this new approach will provide greater control over suppliers and ultimately more negotiating power.

To make this change process easier and ultimately more successful, three key steps must be taken:

· The procurement department must always involve key stakeholders in the decision making process and discuss their objectives and expectations clearly before they begin to source suppliers. This will provide clarity around what is needed and ensure that the supply chain team is involved in the decision from day one

· Both parties must maintain good relationships with suppliers at all time, even when re-evaluating the supplier network. It’s critical to be open and honest as existing suppliers are likely to understand that refreshing deals can bring new energy to both sides of the equation

· All parties must clearly understand the selection matrix which procurement professionals use - whilst these may vary from organisation to organisation, there are usually standard measures and weightings which are used across all decision-making processes, so these should be considered at the outset

Once this is done, all stakeholders should hopefully realise that aligning procurement and outsourcing choices is for the greater good. Whilst both sides may need education on how the other works, there are many benefits to including procurement professionals in the decision making process, including improved business agility, better risk analysis and improved ‘financial bang for the buck’. By using an aligned model in this fashion, public sector organisations will be able to plan more effectively and overcome potential risks and problems associated with the ongoing funding barrier issues they face every day, as well as minimise the cultural friction.

As anticipated, this year’s budget evoked the typical hue and cry that often follows cuts to public spending coupled with tax rises.

We are all no doubt familiar with the decrease in corporation tax. Some of us will have debated the income tax personal allowance increase and many will certainly have a view on the rise in national insurance for employees. However the Annual Investment Allowance (AIA) is one particular budget item that seems to have escaped without much debate.

The upcoming reduction in the AIA is significant as it will restrict businesses looking to make significant capital expenditure as tax relief will be reduced, which could hinder growth.

The AIA currently stands at £100,000. As of April 2012, this will be reduced to £25,000. In real terms, this means that from April 2012, businesses making annual capital expenditure of £100,000 will lose the ability to reduce their corporation tax by up to £20,000, depending on their profit levels and the applicable rate of corporation tax.

So, whilst businesses are celebrating a reduction in corporation tax they are also likely to be hit by the AIA reduction, which shortens the timeframe in which to claim capital allowances. The phrase ‘robbing Peter to pay Paul’ springs to mind.

There is currently much debate around how government cuts will impact upon the outsourcing industry. Many view it as an opportunity for the outsourcing industry to flourish. Others believe that with the cuts will lead to reduced spend as business begin to scrutinise their overheads more then ever. Either way, the government has made much of its commitment to generating growth within the private sector so the AIA reduction, which prohibits growth, comes as a surprise.

As a provider of IT services that qualify under the AIA, such as the installation and configuration of equipment and the associated operational costs through to managed services and larger outsourcing contracts, we are telling our customers to take full advantage of the current AIA whilst it continues to exist.

Of course, herein lies another problem. Lending restrictions and limited access to finance means that businesses wishing to harness the potential of investment in IT as a tool for growth could face a number of challenges if on-going finance options remain hard to find.

Many companies are offering 0 per cent finance over two or three years, which means that by making strategic investments before April 2012, businesses can offset the effects of a reduced AIA until 2015, maximising the use of the AIA and cash flow management. But will this be enough to offset what amounts to a 75 per cent reduction in an allowance that has helped businesses grow since it was introduced?

I believe that the government’s decision is short-sighted, particularly in a climate where there is more pressure on the private sector to deliver economic growth combined with even less access to capital. More importantly, the AIA is likely to impact on the growth of many businesses – both the outsourcing companies and their clients - that rely on significant capital expenditure, which could affect overall growth of the UK’s economy.

Whilst businesses cannot influence government to reverse this decision they can make plans to limit its negative financial impact. Perhaps the first challenge is to provide this issue with exposure and get businesses thinking about how it affects them. Either way, I foresee the AIA becoming a wider topic of debate amongst the IT industry between now and April 2012.

ADA Technology Services is an IT managed services and co-sourcing specialist. For more information please visit: http://www.ada.co.uk.

It seems that everyone is talking about cloud computing these days. IT managers are enthusiastic about hosting their data and software on the internet, rather than on managed, dedicated servers, because it makes data more accessible, and easier and less expensive to update. The cloud can support any number of services or applications, and it removes the need to install or upgrade software. Moreover, the cost of acquiring and implementing web-based software is typically a lot lower.

Clearly, public sector organisations stand to benefit greatly from the cost savings and technological benefits that cloud computing offers. So why is it that public sector organisations are taking longer than others to adopt cloud computing?

One potential obstacle is that the market is relatively new, so many buyers lack confidence in their ability to choose the right solutions. With so many cloud-based products and services on the market, they want to make sure they have enough experience to make informed decisions. What should we look out for? What is or isn’t a good buy? How much should we pay, and what should we expect in return? An IT procurement team buying, say, laptops would already know the answers to these questions, but a team buying cloud solutions might not. It doesn’t make the decision-making process any easier that the product offerings are evolving so rapidly.

Naturally, knowledgeable suppliers of cloud-based products and services can help to explain the ins and outs of the market and give public sector organisations the frame of reference they need, educating and guiding them so that they can make choices that are appropriate for their needs. They can help them to define what their most important selection criteria are at a given point in time.

Here are some of the questions that public sector customers ask us most often:

What is the fastest way to achieve cost savings?

If near-term cost savings are the most important consideration, a good first step is to see what software-as-a-service (SaaS) applications are available through your cloud provider. Shifting to a SaaS cloud services model for specific applications almost always results in the most significant savings over existing in-house IT applications. This is because the provider’s development, maintenance and hosting costs are spread over many users. Some providers also offer ‘pay as you go’ payment models.

How can we reduce capex but still access our current IT?

Many public sector organisations want to avoid capital costs, but continue to use their existing software licenses and the applications they have developed internally. Infrastructure-as-a-service (IaaS) providers can set them up with virtual machines, and storage and network services on which they can install their own software. They take a monthly payment to provide a complete infrastructure solution as a managed service, so that their customers no longer need to worry about procuring, maintaining and updating their own infrastructure.

The IaaS model is flexible in that it provides the infrastructure that an organisation requires but allows it to exceed normal demand for short periods when necessary.

How does data security affect my cloud decision?

Some organisations ask how secure cloud-based products and services are. This is understandable, given that users of cloud computing don’t actually know which servers will store their data, or even which country those servers are located in.

Among those in the know, these fears have evaporated. It is possible for two organisations to share space on the same server without sharing each other’s data or putting it at risk. Any IT department considering cloud computing can take comfort in the sheer number of reputable companies already using it to access and share data, and to use and deliver software.

Our experience is that some public sector organisations are more sensitive that others when it comes to the actual geographic location of their data but, to provide maximum market compatibility, we host our customers’ data singularly and securely in the UK.

All responsible managed service providers should receive a classification from Tier 1, which is a relatively simple level of physical security, to Tier 4, which is the most robust, mission critically secure level of security – the level favoured by the Ministry of Defence. Banks and legal services organisations find that the ultra-secure Tier 3 data centre that we operate and offer to our customers gives them the peace of mind they are looking for.

What if we have no training?

A good number of public organisations are not trained in virtualisation or cloud services management, and wonder how they can take advantage of cloud computing without these skills. It makes sense to ensure that cloud services provider can offer a level of service that is an appropriate fit for the organisation’s needs. Does the provider offers pre-sales support free of charge? Which managed services does the provider offer, and how? Does it have its own network operation centre? How will the provider monitor cloud solutions?

Positive answers to these questions should give organisations in the public sector the confidence they need to invest in and take advantage of cloud-based solutions.

Thirty years ago, when you left work, you were done. Only doctors carried pagers — and reaching out to them after hours was truly for life or death matters. Today, though, the communication and social tools designed to save us time in the office by making us more productive, are encroaching upon our personal lives. According to a new industry survey of IT users commissioned by social email software provider harmon.ie, 82 percent of workers stay connected in the evenings, and the majority stay connected during vacation and in bed.

The standard advice to workers struggling to balance work and personal time focuses on prioritizing the work that absolutely has to get done — make a list of what you need to do, stay focused on what’s important, and so on — but you have to take things a step further and manage your connectivity with everyone at the office if you want to truly be able to regain control over your life. Anything else is like hearing that to be in better shape, you really ought to exercise more and eat less. That’s good advice, but it will rarely actually be effective.

These tips will help you cope when your work can always find you.

Get Over the Instant Gratification

In many ways, constant connectivity is about instant gratification. There’s a positive feeling associated with being able to check your email and find something new there. There’s also some anxiety that goes along with being out of the loop, feeling left behind. As addictive as that instant gratification can be, moving past it is crucial. When you’re off duty, the latest item may seem to be urgent, but is it really?

As fun as that instant gratification can be, moving past it is crucial. You have to have something positive you can associate with actually getting your high priority work done.

Managing Emergencies and Expectations

One of the biggest issues that most people face in coping with constant communications is that in the mind of the sender, everything is an emergency. But you don’t necessarily have the same urgency to get back to someone as they had to contact you in the first place, especially if that email or IM comes in when you’re on vacation or sleeping. That makes it crucial to lay some ground work on what actually constitutes an emergency and what can afford to wait until you get back to the office.

Your boss may have a certain expectation that he can always reach you on your mobile, whether you’ve stepped out of the office for lunch or you’re on the beach with your family. It’s not always a policy that management has thought about, but it tends to go with the territory. That means that you need to be proactive and create your own policy, for both people who are further down the ladder or are your managers. You have to write out your personal expectations on communications in order to manage expectations. Without a policy in writing, you can be tempted to give in: you’ll answer a call just this once or handle a few emails just to get things done. You can also confuse the people that you need to work with. Set a meeting if need be to discuss how the policy can be implemented.

Take Vacations from Communications

Always being on is incredibly wearing: from not getting enough sleep to the energy necessary to be always ready to leap into action in response to an email, social update, or IM. To refresh, you have to take time off from work and actually have a separation from the office. That requires certain actions on both your part and by your boss. First, you have to be willing to take a sabbatical from your digital devices —set times when you will be out of reach, and make the choice to turn everything off. You have to be willing to use the off button yourself, or at a minimum separate your personal and business online presence, if you want a vacation to be more than just a change of scenery for where you’re working.

Second, your manager or boss needs to understand that if you’re out of the office, especially if you’re on vacation, that means you shouldn’t be working. At first, it can be difficult for some companies to understand that sort of disconnection, especially in this day and age. But it’s poor business strategy to simply refuse to give employees time to relax: if you can frame your discussion with your boss and with colleagues with the fact you need to be mentally fresh to do your job, it will be easier for them to understand the benefits of creating a division between work time and personal time. Respecting time off also makes people more willing to work — employees can be sure that they aren’t being abused.

Plan a Sit Down with Your Family

Just as with your employer, it’s important to have a clear idea of what expectations are with family members. For some people, it’s easy to wind up in a situation where a relationship suffers because one partner is spending ‘home’ time working. It’s just as easy to wind up in a situation where a family member isn’t clear on boundaries and will contact you regularly during work hours. Laying out what each family member needs in terms of time and communications is important — sticking to it is even more crucial.

Without clear guidelines on the personal side, though, it’s that much easier for your work to find you and encroach on what’s supposed to be personal time.

Introduce Old School Etiquette to the Mix

There’s a reason that grandparents and other elderly relatives tend to get a little icy if you take a phone call at the dinner table. As a general rule, etiquette demands that if someone has taken time out of their day to spend with you — whether in a meeting or in a personal situation — you give them your full attention.

It’s not uncommon that people pull out their cell phones and other electronic devices when they should focus on the person in front of them — according to the same study, two out of three people report doing just that in meetings. But refusing to do so can make your work that much more manageable. It also means that you aren’t abusing other people’s time. It can be frustrating to see everyone in a meeting ignoring you when you’re the speaker.

Revisit Your Personal Communications Policy Regularly

As important as it is to set your guidelines for communication, it’s just as important to revisit them as situations change. At different points in your life, it can be more acceptable to be accessible to work — when you’re young and single, for instance, compared to when you have a brand new baby at home. So don’t assume that the policy that was perfect two years ago will stay that way. It should keep evolving with the rest of your life.

It’s Up to You to Control the Situation

The truth of having a career is that you have to put in the hours and do the work. There will always be situations that pop up and demand attention, even when work is supposed to be the last thing on your mind. But the same is true of your family and anything else you take seriously.

It’s up to you to create guidelines for how you will handle the different parts of your life, and it’s up to you to stick to the rules you’ve created. Remember, it takes practice to get used to being a little less accessible and having a little more control: it’s not a feeling that we can get used to immediately, and it takes self-discipline to keep choosing not to answer every beep and buzz we hear. But the benefits to your own peace of mind and your ability to do your work can be incredible.

Cloud computing has now passed the stage of hype to reality. More and more enterprises are realizing the benefits of remote hosting of IT services rather than local IT management, especially as managing and operating IT networks and services is not getting any easier!

Managing IT networks requires a broad set of competencies in a growing number of technologies and products. It therefore makes sense that these competencies are centralized in larger data centers providing cloud services to a number of smaller enterprises for which IT is not a core competency.

Larger data centers also means larger installations with higher-speed interfaces as well as an obligation to maintain service availability. This requires extensive test and management capabilities to ensure service “up-time”. However, will test and management of cloud services differ from how they are performed today? What are the special challengers that cloud service providers face in this regard?

Challenges of testing and managing cloud services.

The first and fundamental challenge of providing cloud services is service availability. If enterprise customers are to adopt cloud services rather than maintaining local installations, they must be convinced that they can access the services and data that they need whenever they need them without experiencing undue delays. The cloud service must look and feel as if it is local despite the fact that it is hosted remotely.

This leads to the second challenge of service assurance. How can the cloud service provider assure timely delivery and even service availability when it does not control the data communication connection between the cloud service and the enterprise customer? Does the data communication provider have the monitoring infrastructure in place to assure Service Level Agreements (SLA)? Does the cloud service provider have the monitoring infrastructure in place to assure the services provided?

The final challenge is service efficiency. Efficiency in all its aspects from cost, space and power efficiency to efficient and scalable delivery of services using virtualization, efficient servers and high-speed interfaces. In this regard, the accompanying monitoring infrastructure must also follow the same principles.

Testing to meet cloud service challenges

From a testing perspective, there are a number of layers one can address:

• The Wide Area Network (WAN) providing data communication services between the enterprise customer and the cloud service – fundamental to service assurance and testing of end-to-end service availability

• The data center infrastructure comprising servers and data communication between servers (LAN), where service availability and uptime of this equipment is key as well as efficient use of resources to ensure service efficiency

• The monitoring infrastructure in the data center that is the basis for service assurance which itself needs to efficient

• The individual servers and monitoring appliances that are based on servers that must also follow efficiency and availability principles to assure overall service efficiency and service availability

Testing end-to-end

The first test that can be performed is testing end-to-end availability. At a basic level, this involves testing connectivity, but can also involve some specific testing relevant for cloud services, such as latency measurement. Several commercial systems exist for testing latency in a WAN environment. These are most often used by financial institutions to determine the time it takes to execute financial transactions with remote stock exchanges, but can also be used by cloud service providers to test the latency of the connection to enterprise customers.

This solution requires the installation at the enterprise of a network appliance for monitoring latency, which could also be used to test connectivity. Such an appliance could also be used for troubleshooting and SLA monitoring.

Typically the cloud service provider does not own the WAN data communication infrastructure. However, using network monitoring and analysis appliances at both the data center and the enterprise, it is possible to measure the performance of the WAN in providing the data communication service required. The choice of WAN data communication provider should also be driven by the ability of this provider to offer performance data in support of agreed SLAs. In other words, this provider should have the monitoring and analysis infrastructure in place to assure services.

From reaction to service assurance.

Network monitoring and analysis of the data center infrastructure is also crucial as cloud service providers need to rely less on troubleshooting and more on service assurance strategies. In typical IT network deployments, a reactive strategy is preferred whereby issues are dealt with in a troubleshooting manner as they arise. For enterprise LAN environments, this can be acceptable in many cases, as some downtime can be tolerated. However, for cloud service providers, downtime is a disaster. If customers are not confident in the cloud service provider’s ability to assure service availability, they will be quick to find alternatives or even revert to a local installation.

A service assurance strategy involves constant monitoring of the performance of the network and services so that issues can be identified before they arise. Network and application performance monitoring tools are available from a number of vendors for precisely this purpose.

The power of virtualization

One of the technology innovations of particular use to cloud service providers is virtualization. The ability to consolidate multiple cloud services onto as few physical servers as possible provides tremendous efficiency benefits by lower cost, space and power consumption. In addition, the ability to move virtual machines supporting cloud services from one physical server to another allows efficient use of resources in matching time-of-day demand, as well as allowing fast reaction to detected performance issues.

One of the consequences of this consolidation is the need for higher speed interfaces as more data needs to be delivered to each server. This, in turn requires that the data communication infrastructure is dimensioned to provide this data, which in turn demands that the network monitoring infrastructure can keep up with the data rates without losing data. This is far from a given, so cloud service providers need to pay particular attention to the throughput performance of network monitoring and analysis appliances to ensure that they can keep up also in the future.

Within the virtualized servers themselves, there are also emerging solutions to assist in monitoring performance. Just as network and application performance monitoring appliances are available to monitor the physical infrastructure, there are now available virtualized versions of these applications for monitoring virtual applications and communication between virtual machines.

There are also virtual test applications that allow a number of virtual ports to be defined that can be used for load-testing in a cloud environment. This is extremely useful for testing whether a large number of users can access a service without having to deploy a large test network. An ideal tool for cloud service providers.

Bringing virtualization to network monitoring and analysis

While virtualization has been used to improve service efficiency, the network monitoring and analysis infrastructure is still dominated by single server implementations. In many cases, this is because the network monitoring and analysis appliance requires all the processing power it can get. However, there are opportunities to consolidate appliances, especially as servers and server CPUs increase performance on a yearly basis.

Solutions are now available to allow multiple network monitoring and analysis applications to be hosted on the same physical server. If all the applications are based on the same operating system, intelligent network adapters have the ability to ensure that data is shared between these applications, which often need to analyze the same data at the same time, but for different purposes.

However, for situations where the applications are based on different operating systems, virtualization can be used to consolidate them onto a single physical server. Demonstrations have shown that up to 32 applications can thus be consolidated using virtualization.

By pursuing opportunities for consolidation of network monitoring and analysis appliances, cloud service providers can further improve service efficiency.

From passive hosting to active provision of services

Testing of cloud services, or more specifically, service assurance, availability and efficiency, will separate the amateurs from the professionals in the cloud service arena. The days of passively hosting virtual machines on a best effort basis are gone. Assuring the availability of services using efficient infrastructure and active network monitoring and analysis will ensure that enterprise customers will never look back once they have moved to the cloud.

The rise of the celebrity entrepreneur - a la Dragon’s Den and The Apprentice - would have us believe that a successful business is based on one individual, a single driving force. However, for most businesses this simply isn’t the case. Despite being the face of Virgin, Richard Branson once famously said his success was founded upon employing people better than himself, giving a vital clue to one of the secrets of his success: the importance of a good management team. Undoubtedly, having a strong figurehead is important, but it’s the supporting team that really forms the foundations for a successful business. So how can it be achieved?

One of the key elements of building a sustainable business is ensuring that it doesn’t depend solely on you. At some point you may want to sell your business, step back or retire, so if you’re central to all business activity and decisions, you’re setting yourself up for a fall. What will happen when you’re not there?

This is similar with clients. If you own all the client relationships, they’re naturally going to be unnerved if you suddenly step out the picture. You need to build client trust by gradually letting your management team take over the relationships and provide reassurance by maintaining a backseat presence.

Not letting go is one of the most common failings of business owners. Understandably, it’s a big step. For many entrepreneurs or CEOs who have shed blood, sweat and tears building a prosperous business, the thought of sharing the day-to-day running of the company with others may be a nerve-wracking decision to say the least. However difficult it may be, it is a vital stage for every successful business owner.

If taken slowly, it is easy to achieve too. It’s all about managed transition and definitely not retirement. Phasing the roles by introducing a Deputy MD role for one year prepares everyone for the next phase, when that person is promoted as your successor and takes over the running of the business. The plans are then transparent. Do not be tempted to be incommunicado in an effort to prove a point; if anything, always be available for support. It’s not that you don’t trust the team, it shows that you still care - which the team will appreciate.

A CEO’s responsibility is to provide strategic direction for the company and focus on long-term growth, not the day-to-day running of the business. It is a fantastic feeling to be able to add value by PR, networking, support and business development without the daily operational involvement. Building a sustainable business starts with employing the right people. Take a leaf out of Branson’s book and don’t be afraid to employ people with an enviable array of skills, even if they outweigh yours.

Focus on the strengths of your management team and identify well in advance possible candidates for leadership and invest in development training as preparation. Give them the authority to make decisions and let them make them! Remember, your way isn’t the only way. Make no mistake, you can still influence business decisions, but more by guiding and mentoring your management team than direct involvement.

Beyond internal policy and structure, sustainable businesses are a product of the environment. CEOs need to be brutal. Look again at your market and ask whether you’re in the game. If the market’s changing, but the company’s not, you’re in trouble. The thought of making tough decisions can be enough to drive weak managers to adopt a head in sand approach, ultimately at the cost of the business. Technology demands may dictate that strategic investment will be required and maintaining the focus on ROI and future planning will be a key to success.

Building a sustainable business requires a lot of planning, resources and a certain amount of resilience, but the stability it affords, along with the credibility, is almost certainly worth it.

Before any organisation decides to outsource recruitment to an external specialist, shouldn’t it be crystal clear about what they want that specialist to do? After all, even the best outsourcing partner can only be as good as the brief they are given, But in a world where change seems to accelerate with every passing day, how does a business determine what sort of talent it should be seeking to acquire, not just for today, but for an increasingly puzzling future?

Over recent months Ochre House has been benchmarking a range of major companies, as well as a targeted selection of fast growing SMEs to measure their talent management strategies. And the one of the most worrying findings of the research has been the fact that very few have any real concept of what skills and capabilities their employees will need in five years time, let alone how feasible it is to source such skills in the current marketplace.

Fortunately there are a few businesses taking the idea of strategic workforce planning seriously and providing a template for any others that might care to follow their lead. One of the most striking examples is Arcelor Mittal, the world’s leading steel company. Here HR is one of only two functions that report directly into the chairman and CEO, Lakshmi Mittal and is tasked with maintaining a rolling plan which identifies what capabilities the company will require over the next three and five years and how to access them.

It’s an expensive and time consuming enterprise, but it allows the organisation to achieve something that is really quite remarkable – a prediction of what the future might look like and how the business can take best advantage of it. But that has only come about because the people at the very top have recognised just how vital this is and have been willing to invest the necessary time, resources and cash to make it a reality.

This, in my opinion, is the key. HR professionals cannot create the all-important alignment of commercial and talent strategies on their own. Commitment from the boardroom is essential. But only by clarifying the target that an outsourcing partner will be trying to hit can a business get best value from the outsourcing decision.

Helena Parry is a director at recruitment outsourcing and talent management specialist, Ochre House.

Jim Stikeleather, Chief Innovation Officer at Dell Services, discusses the common myth that successful innovations require large-scale, disruptive revolution.

Myth 2: Successful innovations require large-scale, disruptive revolution.

Reality 2: The most successful innovations are often the simplest.

Disruptive innovative, as opposed to incremental improvement, is not typically achieved by asking customers what they want or need. Some businesses do not do formalized market research (focus groups, surveys, panels) to determine the “next big thing.” They do, however, use traditional market research tools to determine incremental feature improvements for the next generation of an existing product e.g., mobile phones. Truly disruptive ideas rarely emerge from asking people what they want because the answers are grounded in existing products as reference points. As Henry Ford famously said, “If I had asked people what they want, they would have said a faster horse.”

Historically, one element of Dell’s formula for innovation involves gathering requirements from tens of thousands of daily customer interactions. This grows from Dell’s “customer-centric” business model, a frequently cited company attribute. This yields a deep and differentiating understanding and response to customer’s stated requirements. While this has yielded sustained incremental innovations that address what customers request, Dell is now engaged in the process of disruptive innovation based on the next-generation capabilities of cloud computing. The company still listens to what customers want – even listening more intently than ever before. The resulting “pragmatic innovation” is important, but the larger emphasis is the development of solutions that transform how IT is delivered and consumed. The company’s approach to enterprises can enable customers to effectively shift their business models and processes to thrive in a dynamic and rapidly changing global marketplace.

“Faster better cheaper” is a traditional mantra for IT groups as well as for businesses in general. Yet, this race to the bottom is neither effective nor sustainable for producing long-term margins. Margins, after all, are necessary to support investments in R&D (gaining knowledge) and translating that into capital. Going back to the Henry Ford quote, he understood that people wanted a faster horse, but what they really needed was a better and faster mode of transportation. The skill set (or ability, or instinct) to properly articulate an underlying customer want into what customers really need is essential for delivering disruptive innovation. Furthermore, by correctly reading the customer challenge, you set the groundwork for marketing and messaging that will cause the customer to buy the disruptive solution. The more value that you can provide with your solution, the higher the price you can charge, with the resulting positive impact on margins.

Bringing disruptive innovations to the light of day is never easy, no matter how inspiring or world-changing the ideas are. Within recent human memory, “experts” have rejected the germ theory, dismissed the telephone and scoffed at the semiconductor. Success requires persistence and a well-conceived strategy for engaging with detractors to create a pathway for an idea’s success. You also must roll up your sleeves and dive into the hard challenges of execution. Most competitors still acting in the R&D-driven model of innovation and are caught up in traditional organizational/technical/process silos, which makes innovation difficult.