Walter Adamson

Unparalleled cloud opportunity in Australia - Parallels

The Parallels Australia SMB Cloud Insights survey caught my attention. It's released as a pre-conference marketing promotion but it still contains some useful unbiased results.

The fact that it's benchmarked to similar surveys across the developed world is what makes it most relevant and interesting. It turns out that Australia is a poor cousin when it comes to cloud adoption, particularly in SMBs with 20 to 250 employees. For example, In other developed countries 49% of those report using hosted servers, whereas in Australia the figure is 22%. For smaller Australian businesses the uptake is about 60-70% of the other developed countries.

Of course "hosted servers" aren't really "cloud" - but managing hosted servers is what Parallels sells. The figures can be taken as indicative of the general attitude toward broader cloud services, with hosted servers being used as an example.

I wanted to post a question on the Parallels' blog, but what grabbed my attention was this, which I've never seen before:

WOW! Nifty.I've never seen that before. It helps both parties SEO-wise, to get the cross links, and I think it encourages a response (like mine!).

My questions

1. Parallels concludes that the strongest growth opportunity among Australian SMBs is targeting small businesses with less than 50 employees. What are the signals that would tell a service provider that such a business is getting ready to buy?
   I don't mean cold calling asking the direct question. But what, for example, would be the indirect question and signals - would it be mobile adoption or an application upgrade for example?
2. The larger, up to 250 employee, businesses were the real laggards compared to the rest of the world. They have bigger budgets, but the implied inhibitor is their own IT staff. What are the key inhibitions of the IT staff and how should they be addressed? Knowing that would open up a much bigger set of opportunities.

Is Australia lagging everywhere?

At the same time as Parallels noted Australia lagging in cloud adoption, I saw this report Security Risks Lead To A Third Of Australian Employers Banning Social Media. The biggest trends of our time, which will dramatically effect how business is done, are cloud, social and mobile. So our businesses are behind in cloud and banning social media!

Next we only need employers to come out with a survey saying "Employers declare iPhone a work menace!" and we'd have to start shedding tears. But wait - Australian employers “paralysed” in the face of consumerisation of IT - oh NO!

Unisys Asia Pacific vice president and general manager of IT outsourcing, Lee Ward, said employers were "paralysed" by the BYOT challenge, "over the last 12 months, employers have moved from "blissful ignorance" to "paralysed awareness" in the face of consumerisation of IT", she said.

What does this spell out? Opportunity!

Opportunity opportunity opportunity

For those who understand the business shifts and gains from cloud, mobile and social this spells out an "unparralleled" opportunity to get well ahead of the pack.

I'll be interested to see more details of the final Parallels Australian report, which they are releasing at their APAC Summit.

Where do you think the best opportunities lie, in the less than or more than 50 employee SMBs?

Where do you see the best business opportunities at the convergence of cloud, social and mobile?

See my question on Quora.

Please comment below.

Walter @adamson
http://xeeme.com/walter

Are Cloud Computing AND Social Enterprise both at Tipping Points?

A tipping point is when a small input related to a change pattern suddenly creates great change - perhaps takes off to critical mass. I wonder if Marc Benioff of Salesforce has done that within the last couple of weeks in relation to both cloud and social enterprise? My bones are stirring!

Security and privacy no longer a barrier

"... people erect these barriers around security and privacy, which in some ways are very unfounded. And the reason I think they’re unfounded and ridiculous ..."

Who said that - someone from Amazon, or Microsoft, or Salesforce?

No, it was said at a Dreamforce 2011 panel by the former US federal government chief information officer, Vivek Kundra.

He added:

... is because the United States government already has outsourced over 4700 systems. These systems are already in the hands of Lockheed, Raytheon, Boeing, Northrup-Grumman — you name it. Yet when it comes to Cloud, for some reason, these fears are raised.

To me that's huge. That's game over for governments everywhere.

Of course the US Government, and its cloud suppliers, can afford to have US-based storage and clear legal jurisdiction. Which means THAT issue is the fundamental issue for other governments to resolve and then they can plan their move to cloud.

Same story for business. But actually much less of a story since 99% of businesses aren't bound by the same restrictions and vanity requirements of governments.

The 10 years which Benoiff has been pushing cloud, and it's been a hard sell, may be about to pay off in a big way. And his efforts will take the whole industry forward with him across the whole spectrum of "cloud" services.

Social enterprise is suddenly everywhere, thanks to Dreamforce

Much more recently Benioff has become a leading advocate of social business and the social enterprise. The change just now is that at the 2001 Dreamworld social enterprise was everywhere! This spurned a huge lift in reporting e.g. Salesforce.com Steers Social Enterprise Movement Amid Cloudy Outlook. And see what Liza Sperling from Seesmic said:

Dreamforce 2011 is over, and many attendees are likely still reeling from the energy, enthusiasm and explosion of information about the social enterprise.

Most surprisingly to me was that the way it was reported was almost like fait accompli. Remarkable!

I completed my certification in Social Media Strategy back in 2009, from the Palo Alto-based Social Media Academy founded by Axel Schultze. Professionally I've benefited enormously from that superb business-based training program and the methodologies. But it's still been something which has to be pushed.

Much of my consulting is centered at the intersection of cloud computing, mobile, social business, and collaborative commerce, and what businesses need to do to prepare for and survive the impact of the coming shifts. And that's also been somewhat evangelical - I only see the innovative, forward-thinking types.

But I am getting a feeling that this is all heading mainstream right now, at least the cloud and the social enterprise parts of the equation. Mobile has a bit to go. It is being catalysed by the consumerization of IT, and Apple, but not yet at the tipping point. And collaborative commerce is still only early thinkers and adopters (as far as how all these impact "traditional" business models, I mean).

Social enterprise front, left and center

But in social business, social enteprise we hear this:

During the week-long Dreamforce, the common catch-all phrase from Salesforce.com executives was that Social Enterprise has become the rocket ship "that will propel the business of anyone associated with the vendor’s platform and applications strategies to stratospheric levels".

But we don't just hear and read it once, and just from Salesforce. We are starting to hear it everywhere and all sorts of business people are picking up the message - see here and see what you find on Google News.

Something is happening, and I think the next 12 months might be a lot less evangelical and a lot more practical, thanks to the education effort of players like Salesforce and Marc Benoiff.

What kind of sense do you feel about cloud, and social enterprise, as business trends?

Do you think we're near a tipping point for either and why?

See my question on Quora.

Please comment below.

Walter @adamson
http://xeeme.com/walter

PS Some readers may think that Salesforce is just another quite shallow vendor hyping its latest Chatter enhancements with a show about social enterprise. In that case you should read some of the thoughts underlying it, in particular those of JP Rangaswami.

Image from www.enterpriseirregulars.com

Would the real cloud innovation please stand up!

The topic of "Innovation" has been trending ever since Steve Jobs announced he was quitting.

It makes a plethora of interesting reading about how companies innovate and how Apple is said to innovate, whether Jobs was critical to their innovation,and in fact the greatest CEO ever! There is even raging debate over the word itself including "creative disruptive" innovation! (It makes sense!). We have warnings against gamification of innovation, against democratization,  and in favour of democratization, and about the long nose of innovation. We read of encouraging positive deviance and emergent employees. And we even have debates about whether Henry Ford said or did not say "If I had asked people what they wanted, they would have said faster horses".

And then there's the cloud! Is it innovative or not?

Cloud innovation, real or not?

I'm a fan of Simon Wardley and Randy Bias on this (and throw in some Berard Golden). Cloud computing per se is not really disruptive innovation. That's not to say that it is not innovative. And it is certainly not to say that it is the same old thing we've had for years just rebadged by marketers.

Is Cloud Computing Old Hat?

That "old hat" line, used by the best salesmen in the old enterprise software and new private cloud vendor organisations, is simply a ploy. It's a sales ploy to keep the buyer in their comfort zone while they sell them some more "stuff" to keep them away from the real cloud.

Need to get your head into the value not the features

As far as the IT infrastructure goes it's fair to say that it is evolving, or sustaining, innovation and not disruptive innovation. Even though for the major cloud operators and providers e.g. Facebook or Amazon, it has required a lot of innovative pursuits, the result from the consumers' viewpoint is not disruptive innovation.

For instance, let's consider virtualization, because it is often discussed as the core "innovation" of cloud computing. I've picked it for 2 reasons. The first reason is that often becomes the sink hole for discussions on cloud, as the be-all and end-all, and the second reason is that it illustrates the point about evolving innovation.

Discussions about cloud often centre on virtualization. But cloud and virtualization are independent, especially as far as the potential of disruptive innovation is concerned, and I'll come to that later. Google, Facebook, Amazon don't use virtualisation. Why not? It's probably more complex but the reasoning at its simplest is that they can't afford to use it. It would increase their capital and operating costs and cut their margins by doing so - think of a 20% hit to each.

Why then, do so many big IT shops use virtualization. Good question!

Here's the uncommon answers  - firstly they have to clean up their mess, and secondly they haven't got the talent not to.

I'll explain:

• Cleaning up the mess. When you've built an infrastructure mess which is getting worse, it can become economically attractive to impose layers of inefficiency since those inefficiencies are less costly than continuing to build more mess. 
• Haven't got the talent. The big cloud providers are magnets for the top talent, and it takes talent to get all this right. The Amazon and the Googles and the Facebooks and the Microsofts have the most challenging cloud workloads on the planet - even the big banks don't rate at this scale. It takes talent to move your core systems into a real cloud environment and especially a super-efficient non-virtualized one a la Facebook.

Virtualization does offer a path forward for those "normal" big IT shops who have a mess to clean up. It's an effective way to get some mess under control and hopefully to get a tighter and more efficient architecture out of the transition going forward out of virtualization. But it is not fundamental to "cloud computing".

Conclusion, if you could do it, you often would be better to not virtualize anything in building your core services into a real cloud environment. At best virtualization is a feature, not a benefit.

The second reason I mentioned virtualization was to illustrate its evolutionary heritage. It's certainly not new.

Most often people reference the late 70's and IBM. But it was in commercial use in the early-70s by Burroughs, and by ICL of the UK. ICL's George 3 operating system allowed for multiple copies of its predecessor, the George 2 OS, to be hosted within it as a migration strategy. All the old programs could be run "as is" under George 2, while the system as a whole ran under George 3. This feature offered many advantages in systems administration, but was ineffecient. I know, because I was a George 2 and a George 3 systems programmer, and I wrote my Masters thesis on Machine Portability in the mid 70s.

So the point is that the myriad of developments needed to deliver cloud as a service are part of a chain of evolutionary innovation. This is of no interest to the business consumers of cloud, as these are simply features of cloud not benefits to the business user.

The key for business is that the delivery chain of cloud has now reached a point where it can enable disruptive innovation for the business.

It's about the business bozo!

That is, the features of cloud have been cleverly developed over a long time - they do represent something new in their combination. But the potential of cloud is in the benefit to business to create new business models, new services, new sources of wealth, and new agility.

Those can be disruptive, at the business and industry level. That's why business should be extremely interested in cloud and very uninterested in how it is delivered.

Does it interest you how telco carriers have evolved and developed the technology to deliver us better internet access? For 99.99999% of us the answer is no. But we are interested in how we can make money from having that asset, and particularly if we can layer on a disruptive business model.

Cloud is a vehicle for disruptive innovation by those higher up the value chain - not on the provider side but in the higher order application on the customer business model side.

In fact it's the biggest disruptive opportunity for business for the last 20 years. That's where the opportunity for real cloud innovation lies. And that's also the reason that those businesses which stick their heads in the sand about cloud may well be placing their business at risk of being attacked by more nimble and cost-effective competitors.

If you are driving your business forward and see innovation as an ingrained strength then you must come to grips, as soon as possible, with how cloud computing can help deliver shareholder value.

Why do so many firms find themselves debating cloud innovation rather than business innovation from cloud?

See my question on Quora.

Please comment below.

Walter @adamson
http://xeesm.com/walter

Apple's success Dr Deming's legacy - continuous improvement

Innovation guru Clayton Christensen writes that "Jobs made Apple great by ignoring profit", and beyond the headline he actually makes the point that a tunnel vision on profits has been the downfall of many previous industry leaders. He thinks that acceptance, and even pursuit of "disruption", is the core of Apple's sustainability as a highly successful business. But I think there's more to it, especially in the case of Apple.

I agree with (almost) everything Christensen says. And the aspect of Apple he describes is evident in their public comments about the cannibalisation of Mac sales by the iPad.

It's Apple's view of the bigger picture which drives them forward, knowing that Mac sales in some segments will be cannibalized, but in other segments new markets for Mac will open up because of the iPhone and iPad.

I never cease to be appalled at the number of senior executives I meet who say something like "our strategy is very simple - it's to make a profit". Christensen's post is a good reference for them to understand why this may not be in their firm's best interest (that's not to say that the individual's interest and the firm's long-term interest are necessarily aligned!).

Of course there are always certain times when a focus on cash-flow and profitability is paramount. But that's a tactic, or perhaps a short-term strategy, and not a sustaining goal.

The iPod wasn't a device with no existing market

I disagree with one single part of Christensens' analysis, and that points to the big part which I think his post is missing - the role of continuous business improvement. 

The one part I don't agree with is his comment that the iPod was a device for which "a market did not even exist yet".

That's factually wrong. The iPod used a whole lot of technology from others who were already in the market with these devices. Just as with the app store, commercially launched by DoCoMo in Japan in 1999, and "iTunes" launched by KDDI in Japan in 2000 in response to DoCoMo's app store, Apple took the best of a lot of existing ideas and improved them.

The improvements were often small - but they add up.

And sometimes they are innovative enough to be patentable. In fact Apple's patents tell the story - if they invented everything that people commonly attributed to them then Apple would own the patents - and they don't. There is so much fluff and gushing in the blog-sphere and paid media about Apple's inventiveness around the iPhone, for example, which just isn't true. 

Continuous improvement is a key to Apple's success

What they do brilliantly is what Christensen describes, plus their approach to ingrained continuous improvement, as with the iPod and the iPhone (and some might say the iPad - a reinvented "tablet").

Most companies neglect this "ingrained continuous improvement". It's seen as too boring, or too trivial, or tainted by "quality control" or "being too Japanese" or any other reason that suits their desire to do something more spectacular. They go for "creativity" and "innovation departments".

That's why you see many of the most lifeless entities with big investments in Innovation VPs and Departments and creativity training etc - think banks, governments, metro transportation companies. These types of entities have zero continuous improvement and a big bet on "creativity" but are usually sustained, in fact, by some kind of monopolistic or oligopolistic structural position.

In these organisations, the main innovation is "the event". Here's what Cyril Bouquet concludes after a 5 year study of corporate innovation:

Paradoxically, innovation events can even prove damaging if the company does not have a system for acknowledging, assessing, and developing the bright ideas that emerge from them.

Continuous improvement does not exist in a vacuum

If a firm is truly after game-changing innovation, then a different set of rules and pre-conditions apply. But the reality is that 99% of firms can't execute even "incremental innovation" well and that's where the focus, for them, needs to be. There's no doubt that part of Apple, including Steve Jobs, applied game-changing innovation (see below) yet at the same time the bulk of the organisation is focused on continuous improvement.

But wait! There is a twist. That "bulk of the organisation" is not just a hapless bunch of micro-improvers. Well, they could be, but there is a difference in a highly successful organisation - they have a purpose. Not only a purpose but a clarity of purpose, and a consistency of actions.

Where there is strategic clarity and a compelling purpose in an organisation and the entire organization is aligned on achieving something of great social value beyond the tactical, people become incredibly committed to being successful and tend to ignore boundaries and "not invented here" limitations in order to achieve the purpose.

That is part of Apple's secret source in making continuous improvement deliver so much value, and why some say Why Apple Doesn't Need Steve Jobs. Without that secret source continuous improvements are diluted. It's that simple.

It's also true that the secret sauce does need some healthy additives from the leadership team.  Not all that bubbles up from below is going to make business sense at the time, nor can it all be funded. The skill is in how the leadership team can provide a "focus",  how they guide risk assessment to avoid irrelevant innovation, and how they decide what needs to be discontinued (since companies can't do it all). The HOW of those is critical to sustaining the motivation and momentum.

iPhone more about continuous improvement and little about invention

I think ingrained continuous improvement is mostly overlooked, yet it is far a more powerful and sustaining organisational force than "invention". And Apple is a leader in applying it.

For example the iPhone was mostly a result of continuous improvement. It bought together things which others had done, commercially, and reshaped them nicely into a smooth ecosystem. It was "smoother" than those from which it learnt. It didn't even have any exceptional new goals, compared to the DoCoMo app store or the KDDI music service - but it executed better and in the right market.

For example DoCoMo's i-mode (1999) was totally focused on the end-to-end experience and the user interface and they even tuned their network to ensure the handsets performed to delight the users. And they gave content providers 90% of the revenue because they wanted the content providers and their ecosystem to be as economically successful as possible.

The really remarkable innovations with the iPhone, for example, were that (1) it broke out from under the dead hand of the telcos - that was a revolution (a game-changing business model innovation), and (2) the extent of the media deals (or perhaps that was a continuous innovation from the iPod). The hard yards and the strength of the final whole offer were a product of a relentless focus and ingrained culture of continuous improvement. This spans the whole organisation, not just the Innovation Department.

I believe that much of Apple's success can be attributed to this attitude towards continuous improvement across the entire firm, plus the leadership's lack of fear of cannibalization as Christensen says (combined with their other assets and ability to execute).

Continuous improvement as an ingrained culture is old fashioned and unfashionable but Dr. Deming had it right - as Apple proves.

How important is continuous improvement to Apple's success, compared to say "invention"?

Why do so many firms find continuous improvement so hard to ingrain?

Please comment below.

Walter @adamson
http://xeesm.com/walter

PS If you are interested in Cloud, and Clayton Christensen, read What Clayton Christensen Can Teach Us by Cloud expert @bernardgolden

HP+ Managing the HP fallout will take more than PR

In a huge week of IT industry news HP dropping the Touchpad was one of the biggest tsunamis. Especially since it came with news that HP will sell off its PC division.

Is that what you heard?

Well you may have it wrong. HP is mounting a PR war to counter that interpretation, which might seem futile to outsiders, but if you're an insider how could you do anything else?

But it will take more than PR to convince people otherwise, HP is going to have to go into overdrive with a new HP+!

People like Michael Dell heard the wrong version, according to this tweet:

 

HP's UK head of their PCG Group clarified things in The Guardian:

There have been a number of incorrect stories saying that HP is quitting the PC business. Let me be absolutely clear in saying that at no stage has HP said it is quitting the PC business. Three options are being investigated, and whether the company is spun off, sold or kept in the HP portfolio.

There. That's crystal clear, right? Michael Dell's interpretation, admittedly acting with self-interest, isn't far off is it? And if self-interest needs to be taken out of the equation then we'd have to heavily discount all the HP spin.

It's a touchy subject. HP's PR machine, through Bill Wohl who rightly describes himself as a "seasoned Chief Communications Officer for HP" took offence to this tweet via @rwang0 and @timbo2002.

But isn't that a seriously reasonable tweet?

From my observations Bill Wohl does a good job, and his Twitter stream is eclectic. I like a lot of his references. But he's really pulling the belt too tight to call a rational observation "wrong" and even "inappropriate".

As soon as he did that he just ran up the flag of PR mumbo jumbo and asked people to salute, which they won't these days.

Just Google it - this sentiment is out there everywhere. @rwang0 and @timbo2002 are no duds! Even this article which Bill Wohl praised for its positive take on the Autonomy acquisition had this to say "...effectively putting the PC business on the market". There's even a coherent argument by Bill Sydner at Infoworld postulating the HP breakup "The sharks are circling HP -- can anyone save it? "

If you are going to telegraph your punches then you better have an alternative strategy to surprise the attackers! Otherwise they are going to be all over you - like on UFC - ground and pound!

The question is how to come to grips with the sentiment and contribute and participate in where it is headed?

It's a very difficult position to be in, witness Nokia's self-initiated implosion when they forecast the end of their Symbian platform. Sales weren't supposed to drop like a stone, but they did. HP could be facing similar prospects in its PSG Division. It's frightening, considering that Nokia have lost 75% of their Western European smartphone sales in few months since making their ill-fated announcement - and Nokia want to stay in the business!! (See Why Europe Is So Critical to Nokia in Smartphones by Tomi Ahonen)

And the best way is for HP to be as decisive as they were in killing the Touchpad. Otherwise it is going to be a long hard haul to nowhere for the HP PR team.

HP should also get real about WebOS which is as dead as a dodo.

How do you think that HP can best handle the social media over PSG

Please comment below.

Walter @adamson
http://xeesm.com/walter

Group Think! HP tablet delusions create expensive WebOS boat anchor

HP VP Eric Cador promises TouchPad will beat iPad 2

Eric Cador (@ecador) is, or perhaps was, the senior vice president of the Personal Systems Group in the Europe, Middle East and Africa region (EMEA) for HP.

HP beat their own chest

In May, just 3 months ago, he predicted that the HP tablet would not only beat the iPad but more than just #1 would become #1-plus. Kind of like a hardware vendors equivalent to Google+ I suppose.

I'm not picking on Mr Cador. But he went public and PR with his hapless prediction, spread it far and wide, and even roped in his colleagues with his explanation "We call it number one plus". Well they were suffering group-delusions as a fair few predicted, including my good self.

Does HP's TouchPad have a hope against the iPad? July 1, CRN Australia

My comment at that time: "HP obviously have a vision for the tablet which extends to them matching the Apple, Android and MS ecosystems (meaning in the main developers + music). Personally I don't see it at all, and without that ecosystem a tablet is just another piece of junk - a boat anchor."

Group think surely a culprit

Group think is a common corporate disease, and when you are as stove-piped as HP (as is commonly known) it is even more deadly.

My boat anchor prediction came true and now HP has thrown it overboard, not even 7 weeks after it's launch.

Credit where credit is due

I'll give HP credit for this - the person that so quickly pulled the plug and killed the whole WebOS tablet line of business today did a brave thing, corporately. That is impressive. These kinds of project generate a life of their own, and it is tremendously hard to bring them to heel.

Rather than die a death of a thousand cuts someone stepped up to the plate. The question: is that person most likely to be someone from within the delusional project or from outside it?

The answer is obvious and that's probably the result of some very tough metrics being imposed upon the project from the outside, and the project failing to meet them. The metrics probably came from the Group Finance function.

WebOS is worthless

I notice that there is a lot of discussion about HP selling the WebOS operating system. I'd say the people who believe that WebOS is worth anything are the same people who thought that the HP tablet would be a great success. Sure, according to all the geek accounts it seems like a very well constructed operating system. And where did that get the tablet - directly to failure, don't pass GO!

WebOS IS worth something, a token, to a manufacturer in a niche equipment market. Otherwise, speaking in the context of the global phone and tablet market, it is worthless, literally. It's been proven once, or was that twice given that Palm failed as well. Who would feel the urge to take the risk one more time? Knock yourself out if you'd like to try. I'll make my prediction right here - it will fail again. 

Why? Because it's not about the operating system or the hardware, they are only tickets to the game, not the game.

Perfect storm - the big mobile world re-order

Google's acquisition of Motorola Mobility, Nokia's implosion and its deal with Microsoft, HP's tablet launch disaster, the patent wars, are all signalling a massive shake-up and re-alignment in the mobile world and "non-PC" world. Hang on for the ride, it's going to be tremendously exciting.

Throw into that mix cloud computing, and social business, and collaborative commerce, and you have a perfect storm for massive business reinvention. And many David's will emerge to kill the Goliaths.

What do you think HP did wrong in assessing the success of their tablet?

How will the tablet wars pan out and who will be left standing?

Please comment below.

Walter @adamson
http://xeeme.com/walter

10 Questions when Data Localisation stalls cloud computing

We often see data localisation bought up as an issue - a reason not to adopt cloud computing. There are the black and white cases, the gray and emotional cases, and the government.

The government is the government; they have money and they can spent it how they want and they can go play somewhere else if they don't like you. That's also the bottom line - the more games government play the more it costs the taxpayer, simple as that. That extra cost may well be justified, for the reasons that the government would wish to promote.

As far as data localisation is concerned, some state governments are specifying that all data must be kept within the state, so that it is unambiguously within reach of the state jurisdiction and only the state jurisdiction.

Constraints cost money

That is a costly constraint, unless the major cloud service providers each happen to have a local facility, and can control and restrict the flow of data. Of course it is unlikely that each of the major providers will have a local facility. Which means that any that do have not only an inside run but also a monopolistic chance to grab the government business. The business outcome of this all-in-State requirement can only be a higher cost, and less flexibility, for the government client.

In the rather famous, or notorious, case of the LA Police Department, Google had to set up a separate data environment called GovCloud - only to be used by Government Agencies. But even then it was not specified that all data had to reside in the state. But Google, and Microsoft, have committed to their government cloud environments maintaining all data within the US.

That's obviously a double standard, since in other parts of the world e.g. Australia, cloud providers such as Google and Micrsoft are promoting the safety and compliance of their cloud offer's eminating from outside Australia e.g. Singapore. It's also an acknowledgement of the commerical reality that the cost of marketing and selling around the objections are higher than the cost of building "GovClouds" in the US.

We only want what you are giving US governments and agencies

So it's a fair question - if you Mr Cloud Provider are bowing to US governments and agencies then what we are requiring in terms of local data housing must be a reasonable and logical request isn't it, after all we probably have relatively similar laws which relate to this area?

Yes it's a fair question.

It just comes down the the business case and the ROI for the provider. The decisions about local in-country or in-state cloud centers are purely based on a business case. If a government can commit to spend enough, over a sufficient period of time, then things can be done.

Ironically the burden of that type of commitment is something which real cloud computing is offering customers the chance to avoid. That's an expensive commitment for customers e.g. goverrnments.

Are there other alternatives?

Does all the data really have to housed locally?

Let's examine some options:

• If the state legislation really requires and can only operate on the basis of all data being held withing a state then that's pretty much the end of the story;
• But actually that's unlikely, we already have outsourcing, and those contracts often using out-of-state centers;
• Then the question is which data, what type of data is mandated to be held locally, and why?
• Is it a quesion of access, or one of denying access to other jurisdictions?
• Is it to conform wholly with Privacy legislation, or are there other important regulations which come into play?

Piece by piece, except in the blanket "all data mst be help here" case, the reasons can be broken down and the alternatives assessed. Even in the case of Google and the LAPD, the interpretation of both the LAPD's security requirements and the FBI's requirement that the Google Apps for Government system be compliant with its Criminal Justice Information Services (CJIS) standards was a matter which required extensive review and determination.

So the interpretation of legislation is often not black and white, and it is in these details that the real cloud strategy and data location requirements need to be discovered.

10 Questions to ask

Digging deeper into what is possible in terms of data location requires that we ask some questions:

1. In which jurisdiction will the service provider store the primary data?
2. Which local laws apply to getting access to that data by local authorities, and what type of authorities would have access? (The US Goverment requires that only US citizens with proper clearance and authority have access to GovCloud.)
3. How will we be notified if local authorities seek access or are given access to our data?
4. Under what circumstances will that data be copied, moved to, or shared with other jurisdictions?
5. How will the cloud provider contractually ensure that the privacy and access conditions for the data, in the "external" jurisdiction, are maintained to at least the same level as that required by the customer government?
6. Which specific part of the State legislation require local data, and for what purposes?
7. Are these requirements blanket omnibus requirements, or specific technical aspects of specific legislation?
8. Can any of the restrictive requirements be amended with an acceptable effect on their objectives or intented outcomes?
9. Which other government bodies or agencies require the State to conform with legislation which impacts on the ability to host data out-of-State?
10. What is the cost implication in terms of total contract and lifecycle cost of an in-state data location requirement versus out-of-State or even out-of-Country or "don't care where"?

Those questions will get into the "whys" of data localisation and help sort out the options and costs.

Risk management

It's also worth noting, as in any risk management exercise, that the risks which are identified with out-of-State data can be treated in 5 ways - they can be accepted, rejected, mitigated, transfered or avoided. The options within each of those 5 categories provide the path for action.

In summary, data localisation is both an emotional and a logical issue for cloud service providers to address. Putting aside a "blanket No" then the real issues can be assembled and then broken down into their key components and their risk, cost, and political implications.

That's not always going to be an easy task. In fact in the case of Google and the LAPD these types of issues caused major overruns and change orders to their cloud migration project.

But the issues can be sorted and will reach a sound conclusion which is cost-effective and meets all the jurisdictional goals.

What do you see as the biggest issue in data location for cloud customers?

Have you seen original restrictve requirements loosened after more detailed analysis?

Walter @adamson
http://xeesm.com/walter

Walter Adamson was the Independent Advisor to the IT Strategy Board of the Government of Victoria for several years commencing 2005.

The other guys were dumb - Nokia dissing its team

I shouldn't be spending my time writing this post because it's more of a complaint about new management dissing the "old management" - but sometimes this goes too far and sets me off!  New Nokia President and Head of North America Chris Weber does a good job of making out that previous Nokia management were essentially clueless and he's sorting all that out.

I'm just thinking, if I was a previous Nokia executive now being hung out to dry for my stupidity and narrow-mindedness I would want to see some stunning new insights from the new team in order to salvage my pride.

Don't hold your breath! The team now dissing the old team are turning out pretty much the same old revolving keyword phrases we hear from so many new incumbents. Let's take a look, for the sake of those who got axed!

A disaster did happen

Of course Nokia has imploded and unfortunately it has imploded very rapidly:

1. For one thing this means that it was not the result of a long term strategy and decline in performance by the bulk of the Nokia management and employees. It was the result of a couple of recent critical decisions, certainly at the behest of the Nokia Board who foresaw the need for change, but it wasn't because of a lack of success across the whole firm; and,

2. At the time these big decisions were made Nokia was still not only a very successful play but a dominant one in many market segments it served. Sure it was a flop in the US and that certainly needed a whole new rethink.

So my point? You don't get to be dominant by having a bunch of unenlightened, unworldy fools in your leadership groups and executive teams.

But HEY I'm all for letting go of things that are passed their due date, and reinventing your business.

Where are things headed?

So what are the new big ideas? That's where it gets a bit depressing, and annoying, because the "new ideas" look like romper room with the head teacher explaining to grandma how to suck eggs.

Here are some of the new thoughts, from the VentureBeat interview and video:

• Weber: Apple and Android, who now dominate the smartphone market, have got it wrong;
• Me: OK - I can kind of see vaguely what he means, it's about a more integrated interface / experience but at this stage this is Nokia theory versus Apple / Android success;
• Q: Why can't Nokia release it's new phones this year?
• Weber: Because negotiating with carriers is complex;
• Me: huh? I thought that's what Nokia did for a living?
• Weber: (Because Weber has fired 80% of his old team) it's now like "running a start-up";
• Me: I don't think so, and if it was then Weber is decidedly the wrong guy to do it !
• Weber: Nokia may beat competitors on pricing
• Me: Wow! I bet the previous Nokia dummkopfs didn't think of that one!
• Weber: "We're going to have some killer features" - see the article
• Me: Could this be a Marketing person talking, I wonder?

Come on, give the old team a break they didn't have everything wrong and in fact they probably had a bunch of real insights which were more grounded than these! There's more.

From the video

Here are the new "insights" from the Weber video interview at VentureBeat:

• Now, it's about execution;
• Do fewer things, be world class, be fast;
• Focus on carriers, and ultimately on end-customers;
• Will be most operator-friendly company around;
• Delight the end-customer;
• Customer-centric;
• Innovative;
• Move fast.

Sorry, but is there anything there which is not just exec-o-babble?

Now for the BIG ideas

In another recent interview, Weber explains more big changes and ideas:

• work with carriers;
• undercut the price of the cheapest Android phones;
• make sure that there are lots of Nokia Windows Phones in stores for customers to test;
• do a better job explaining why consumers should check it out.

To clinch his points Weber added this comment:

"Stephen Elop was smart to realize the mobile war is a war of ecosystems -- hardware, software, services, and carriers. It's not just about having the best phones or software platform."

It's all too sad isn't it?

Nokia had a deep understanding of "ecosystems" and ran some of the most complex in the mobile phone world. This was all established and being executed well before new CEO Elop arrived. And it is an area not yet penetrated by Microsoft, so it's hard to know what significant difference Microsoft experience can bring to that strategy. The core experience and expertise remains with those teams left in Nokia.

Let's put it this way - I think Nokia en-mass understood a lot more about how to make ecosystems work before Mr Elop turned up with his new insights.

If I was an ex-manager reading these new insights I'd be peeved.

Could these new "insights" have saved the day?

Put it this way, if all these new managers, excluding CEO Elop, had have been in place in Nokia in the lead-up to its implosion, would their revealed insights have saved Nokia from its demise?

I don't think so.

I'm sure that the new people are all very smart people. But so were the overwhelming majority of the previous incumbents.

I hope Nokia gets its act together. If it really came up with a meaty new strategy that would be great. But dissing the old team and then doing roadshows of PR business platitudes isn't going to save the day. I just think that the masses of (ex) managers in Nokia deserve a little more respect.

By the way, I do agree with Weber that Microsoft, in it's range of cloud services and enterprise connectivity, is really well placed, and ahead of all the competitors. That's a different issue to dissing all the previous Nokia management.

Walter @adamson
http://xeesm.com/walter

PS Because I researched Chris Weber seeking to find his social connections  I have a little gratuitous advice for him - pay a little attention to your social spaces and places. If your Twitter handle is really @cweberatnokia then that isn't a wise choice, for numerous reasons one of which being that it sounds fake. If it IS real please use your real photo. Your Linkedin profile could do with updating re Nokia details and the only link is to your blog which with the last post on October 10, 2010.

Is an iPad a PC, and how many retailers will fail? - In My Opinion

With this post I've shamelessly copied my colleague Wendy Soucie in having a collection of blog comments, as a post, each week. As Wendy says "one of the ways I participate in the social web is to spend some time each week reading and commenting on blogs and shared content". And she references the Social Media Academy NCP model - Network Size, Contribution, Participation. Wendy and I are both graduates of the Academy and also Founding Partners of the Social Business Consulting Group.

Here are two blog posts which caught my attention and where I commented:

• The reasons retailers will fail, written by Dennis Price, caught my eye in The future is bleak, unless… Dennis discusses research conducted by Lewis & Dart (2011) on what is happening in the retail channel. They predict that 50% of traditional retailers/brand will fail.

What motivated me to comment was because I was struck by the fundamental changes hitting retail - not dissimilar to the mega-trends I try to figure of cloud computing, social business, mobile and collaborative commerce and the impact at the point of intersection on today's businesses. I noted that in my experience the ways business leadership teams react seemed to be the same across many sectors, including, apparently, retail.

 If you're interested in this wave of change then there are many interesting comments.

But undoubtedly the biggest buzz and the highest participation rate was in response to Asymco's post about the PC versus the iPad.

• In Is the tablet computer a new PC or post-PC?" opens with the statement "Steve Ballmer stated and Andy Lees confirmed that Microsoft views iPad and other tablets as “just PCs”".

That really caught my attention as a potentially disasterous mental model for Microsoft around which to wrap their strategies. As I said in my comment: "Hanging on to the belief, the mental model, that the "whole product" of the iPAD is that of a PC sounds extremely dangerous to me, and I'm disappointed in Microsoft."

There's a huge flurry of comments, worth reading.

Because of Nokia's implosion it's a live action case study in management and strategy, and I also tried to leave a comment at Tomi Ahonen's blog where he does the best analysis of this in the business, but after several failed attempts I just could not get my post accepted so I quit. If you're interested in the mobile business, or just plain business strategy, Tomi's posts on Nokia are a must read.

How do you see physical retail competing most successfully with online?

How dangerous is Microsoft's belief that the iPad is just a PC?

What lies behind the disasterous collapse of Nokia, and what is it's best path forward?

I'd like to hear your opinion, please comment below.

Walter @adamson
http://xeesm.com/walter

Missing the mark - Bank 2012 Core Challenges and why they are not

IT News reports that ANZ CIO mulls 2012 challenges, competitors but I'm puzzled that the "challenges" appear so routinely operational. In a world which is uniquely being buffeted by the major mega-trends of cloud, mobile, social enterprise, and unified communication, not to mention consumerization of IT, I would have thought that the challenges would have been far more substantial than just tickets to the game.

In a world where Facebook is better equiped to operate a secure, reliable bank than the Banks are, then a focus on the routine operational tasks - a focus which is predominately inward - is surely not going to deliver the future of banking.

According to the report ANZ CIO Anne Weatherston named "systems availability and security, costs, business alignment, change management" as the 2012 challenges. Really?

I'm puzzled by this report on a number of fronts. No doubt Bank CIOs have challenging jobs. But what really struck me about this list of "2012 challenges" is how operational they are.

THAT is the pot of big challenges? I'm struggling to see what are different in those to the last 20 years, and since they have been the same challenges for the last 20 years why aren't they just a ticket to the game.

I'm not being bold enough to say why aren't they solved, because they do remain a challenge as things evolve. But in another way it could be well expected that they are solved, in the sense that it is just the ongoing day to day management issues which should have processes to cope with new threats and challenges i.e. the risk management and governance should be well and truly solved, and hence these issues are just tickets to the game and not the actually game. Isn't that a reasonable expectation?

I'm further confused about "business alignment". I've seen so many articles in recent years saying that business alignment is all done, furthermore it is an insult to any IT department or CIO to even raise it at a meeting, breakfast or seminar because sure as night follows day they are fully integrated with the business and on top of this passe issue.

Even furthermore they say that even using the phrase implies that IT has been or is "outside" the business, and that is not the case among them. And some articles have expressed their anger at this topic still being on the speaker circuit and consultant agenda. I noticed this because I'm a little less convinced that business alignment is done and dusted. But never-the-less I'm surprised that it's openly on the list of ANZ challenges for 2012. Perhaps I should be pleasantly surprised!

Finally, there's no doubt about the game changing outsiders - the barbarians at the gate. We desperately need more competition, as the Chinese kindly pointed out yesterday.

But I'd be keeping my eye on Facebook far more than Google, and even Paypal. That why I wrote Facebook Credits - 5 things you should know.  Additionally Facebook can keep it's systems running and secure for 750 million, something, with the greatest respect, is beyond the ken of the Australian lead banks. This is not a cheap shot, it's recognition of the fact that our Austalian banks are even struggling just to keep their systems operational let alone create new business.

Finally, I'm surprised that nothing of social business was mentioned. We're right bang at a point where business and IT leaders are struggling to figure out specifically where social media functions belong, both in terms of 1) delivery platform as well as 2) organizational capability. And at this point, organizations are realizing they have to put some serious thought into making organization-wide sense of social media service delivery. This, to me, is a huge challenge and one relevant to bank CIOs and their core enterprise architecture. But this one went AWOL from the 2012 list?

What do you see as the greatest IT challenges for banks in 2012?

Walter @adamson