The last few years of the millennium have seen old business models giving way to new ones. Customer needs are transitioning from those of pure consumption-oriented to those of convenience-oriented with the coming of age of the digital native. Organizations big and small are being affected by the onslaught of myriad of factors including enlightened and demanding customers, newer modes of communication, technology advancements with user dependence on mobility and small form factor devices, and the power of collective intelligence – blogs, wikis, user generated reviews and feedbacks, etc.

So has the meaning of value literally changed from what it was in the earlier days to the present? Or has Value in its representation evolved to “Value 2.0” i.e. becoming more user-oriented, keeping in line with the changing times? How are businesses upgrading themselves to meet the evolving juggernaut of customer needs and wants?

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Last week’s ITxpo Symposium in Cannes drew more than three thousand attendees, over half of which were senior level IT executives.  The conference agenda offered insights into future trends in typical Gartner fashion – high impact, broad sweeping trends combined with business imperatives.  There were three themes that were repeated many times – application retirement, a new era of enterprise application and innovation.. (more…)

One would certainly categorize predictably ill-fated ventures as irrational.  Why would a rational individual undertake an initiative that is almost guaranteed to fail?  Is application rationalization one of those initiatives?  Perhaps it is and that is the reason John McCarthy used the word “courage” to describe the emotional trait necessary to pursue its goals.

Recently, I spoke with Mike Vizard of IT Business Edge.  We discussed many compelling reasons why an organization would pursue application rationalization.  Cost reduction, increased business agility and business transformation were at the top of the list.  But, even with those stakes most organizations are reluctant to give it a try.  There are many reasons why, some legitimate, others not. (more…)

The exercise of application rationalization is certainly complex.  Reconciling the needs of many constituencies within an organization and reconciling those needs against a large and byzantine IT portfolio is a daunting task.  In an effort to eliminate waste, streamline the IT estate and create a more “lean” environment to support, this kind of software engineering project must evaluate the needs of the business and assess a harvesting of the best components of the current application population.  Common service layers can be created and new application support can be created in technologies like BPM.  This is one facet of a business transformation process.

What about the financial justification for this kind of project?  Is the cost an expense or an investment? (more…)

I reviewed a recent webinar given by Pascal Matzke and John McCarthy from Forrester Research on the Future of IT Services.  It was a “teaser” that provided insight into their soon to be released paper.  As veterans and leading analysts in the sector, they have watched the sector grow and mature.  They believe we are at the crossroads of re-invention.

Part of their position is the belief that the wholesale benefits of the labor arbitrage and staff augmentation approach that fueled Indian offshore growth wave is coming to an end.  It’s been a decade of hyper growth and the sector will start to level off as organizations have successfully achieved large scale reductions in TCO through the use of offshore labor.  With legions of offshore developers available to enterprises around the world competition will focus on rates as savvy sourcing managers continue to seek cost reduction.  But, assuming that labor cost can never reach zero, how much lower can it go before quality and service risk outweigh the cost benefits? (more…)