The Business Agility Blog

A recent CIO.com article by Kevin Fogarty aptly named “How To Keep Rogue Cloud Software From Making IT Irrelevant” inspired me to revisit my post about the rising demand for centralized Enterprise AppStores and the IT consumerization fueling it. Fogarty takes an interesting perspective, somewhat inarguably stating that reported statistics about SaaS usage are inaccurate “because they don’t count the business units that are buying cloud services behind IT’s back.”

According to Forrester, “Informal buyers from outside IT buy infrastructure-as-a-service twice as often as “formal” buyers inside IT, and the informal make five times as many software buying decisions as the IT people who are supposed to be in charge.” Reasons for this dichotomy range from strict company policies to the delay when working through IT departments; clearly it’s easier for employees to adopt cloud applications on their own.

Downsides to this are a general lack of organization within the IT landscape, what Fogarty refers to as “cloud sprawl” – the negative side effects of having numerous logins to non-integrated systems, multiple costly subscriptions to cloud apps, and of course – a justifiable fear of the unknown security in place. The article goes on to explain several ways to improve the relationship between business and IT, so that business department managers can feel comfortably relying on IT departments to get them the technology they need.

The central issue, not at all new to IT departments, lies in the evolved distribution mechanism of software: when the general population can access software by tapping a touch screen, employees come to expect comparable luxury at the office. IT can only do so much to compete with consumer focused cloud applications that require no integration or security protocols. Only a few platforms, like the newest version of Mendix, give IT departments the agility and speed they need to properly enable business units.

The idea of an enterprise appstore may be somewhat utopian for most businesses, but the steps that IT departments need to take, and the technological capabilities they’ll need to move towards true business agility, are now evident. It seems as though changing requirements of an enterprise IT department mirror the changing requirements of a single application – except application development can be agile, whereas entire IT departments need to be agile in order to compete. How is the IT department at your organization managing changing demands of business owners?

Animated Short: Application Consumerization

In a recent conversation with a friend of mine, the topic of cloud computing arose in regards to his family business. His father owns an art handling business that is becoming one of the more technology advanced entities in a world of otherwise mechanical, labor intensive processes. The players in this industry are responsible for shipping priceless art around the country.

Historically, this industry has been geographically skewed towards metropolitan areas with strong museum and art communities. Private art collections were growing rapidly during the economic recession, making management at the company increase its priority on these more geographically spread out customers.

So, in a beautiful demonstration of agility, the company adopted cloud computing technology to make opening new offices a piece of cake. The company orders ‘thin client’ computers, configures them to spec at the corporate office, and ships them to a new office overnight – (they are a shipping company after all).

Here at Mendix, we love to see collaboration between business people and IT people. In this case, the IT Manager and the CEO of the company were well advised to open new offices – and the ‘office-in-a-box’ system seems to work wonders for technologically slow industries such as the art handling industry.

The IT guy doesn’t have to travel to the new office; he just maintains the entire system from the corporate office. As you can imagine, the cost savings are significant enough for even a technologically slow industry to implement this process. A central source of data within the company provides valuable information to upper management. Tracking CO₂ emissions, order frequency, and a host of other industry specific measures also increases the value of cloud-based business agility.

Not to be forgotten is the increase in revenue by being agile, even geographically agile in some cases, is the primary reason for this blog. Small and medium businesses will become more agile with similar strategies, and likely prove that serious business agility management always wins the race.

A “What If” question for business analysts and IT professionals…

What if it suddenly became very easy for someone to do both your job and their own, at the same time? If history provides any forecast for the future of IT, we are likely to see some interesting changes in the way human capital is managed – especially for those of us involved in the emergence of cloud computing. Clouds push complexity to the background and allow users to focus on what really matters: functionality and costs.

Have you ever noticed how the education we receive often sets boundaries in our career aspirations? We are trained to do something, and do it well – but in doing so, we take for granted the fact that others are doing the same thing in a different field. Then, when we are faced with an inevitable change, we instinctively take a “That’s not what I’ve been trained to do, there are other people for that” mentality. Sure, there are the motivated few who push down boundaries and become renaissance men and women in their own right. But when everyone else is set in their ways, these people are often considered a risk… think: too many eggs in one basket.

Now, to regress from my pseudo-philosophical banter, this trend is becoming all the more apparent as business analysts become more involved in technical training. Most IT veterans would say that business analysts will never have the true know-how to implement their plans, requirements and recommendations. The modern business analyst usually considers themselves more of a problem solver than a programmer – hence the separation of labor in this function of any business. Having surveyed the blogosphere for opinions of business analysts and IT professionals, there seems to be a live (and even a bit emotional) discussion between those who say it is a natural, and therefore inevitable, progression and those who say it is a “pie in the sky” and that it will never happen.

Contrastingly, a growing population of believers has something to say about the segregation of business and IT. In a world of zeros and ones, the innumerable coding languages can only become more and more efficient. As coding languages are continuously created, survival of the fittest can account for the extinct languages of modern programming. An abstraction of these languages is an ongoing phenomenon with a light at the end of the tunnel. Some say that using abstract, visual and human-readable models instead of low-level code is a very important step towards commoditized coding.

I’ve come to think about this abstraction phenomenon as measure to increase efficiency. When our ancestors realized that making bricks was faster than packing sand, they were on to something similar. If someone else uses molds to make perfectly shaped bricks that can be built into any structure, the workers need different skills but can ultimately build more economically, the architect can plan more accurately, and the buyer can move in earlier. So, why deal with sand when we can get the bricks from vendors elsewhere. Why deal with code, when we can get software modules elsewhere? This, my friends, may be the future of today’s business analyst.  In the future, what if business analysts had the skill set and the molds to create bricks that satisfy their requirements without the need to deal with code – or sand?

Last week, Insurance Networking News, published an article about “Cloud Computing”. Although many think that Cloud Computing is something for the future, some leading companies within industries you wouldn’t expect are deploying Cloud Computing initiatives using Mendix software.

Your Next ‘Cloud’ Provider May Not be a Tech Company at All

By Joe McKendrick

If you don’t use Amazon Web Services, Salesforce.com modules or rent server capacity from IBM’s facilities, you’re obviously not doing “cloud” computing, right?

Not so fast. Actually, you may already be doing some form of cloud computing, but it’s just not being called that. Cloud computing is defined as the acquisition of services from online providers. As the promise of the cloud unfolds, it’s likely that a typical cloud provider will not be a technology company, but an industry partner that is capable of sharing applications and data.

Take the example of Arch Re Facultative, a supplier of facultative reinsurance in the United States and Canada and a subsidiary of New York-based Arch Capital Group. The company is by no means a “cloud provider”—it reinsures risk for insurance industry clients.

But through its intelligent portal technology, Arch Re has been able to position itself as an online resource for its customers, who have widely varying levels of technology expertise. I recently had the chance to chat with Philip Augur, chief operations officer at Arch Re’s latest portal implementation, which automates much of the “automatics,” and also helps expedite the exceptions as well.

Arch Re’s story appears in the latest edition of Insurance Networking News online.

“We sign an automatic with a company that is interested in submitting the risks in this fashion,” Augur told me. “The underwriters are given a login and password. And as they come across risks in their day-to-day business that fits the box, they come on to our Web site and they submit that risk. The portal verifies that it fits the definitions of the box and applies the pre-agreed pricing. If it doesn’t fit the parameters of the box, it tells the underwriter that, but then it says, ‘we’ll still handle that pure facultative, but they don’t have to re-enter anything—the information just comes through to our staff as a special exception to the automatic agreement.”

The portal has eased a major administrative burden for many underwriters who previously had to track down data from their own internal systems. Now, “some prefer to keep the all the information in our system, so we know what fits the ‘box,’ and it’s easy for us to define that,” Augur said. “So once a month, we’ll press a button, extract that information, and send them the information.”

Could Arch Re be considered a “private cloud” provider to its customers? No, again, it’s a facultative reinsurer, and that’s its business. But the definition fits and, ultimately, many non-technology companies will find themselves in the role of providing services via their own private clouds.

Joe McKendrick is an author, consultant, blogger and frequent INN contributor specializing in information technology. He can be reached at joe@mckendrickresearch.com.

The opinions of bloggers on www.insurancenetworking.com do not necessarily reflect those of Insurance Networking News.

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