Friday, March 11, 2005

Utility Computing, Knowledge Management & IBM's RUP

David on IT Outsourcing in China
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Friday, March 10, 2004
Dateline: China

Much has happened over the past four months since my last posting.

For one thing, I've taken over as the AlwaysOn Network "Letter from China" columnist. I'm writing about three columns each month.

I've also launched a podcast titled, "David on Enterprise Software." I'm also writing a series of articles on numerous IT- and China-related topics.

As far as this blog/e-newsletter is concerned, I'm going to take the highlights from my "David on Enterprise Software" podcast and put them in written form with a bottom line reflecting a China perspective. So let's begin.

In my inaugural podcast, I focused on three items:

* Utility computing, from both a virtualization and software-as-a-service perspective,

* A knowledge management reality check, and

* IBM's Rational Unified Process.

Utility Computing: Virtualization

As a reminder, utility computing provides access to corporate IT assets on demand, when you want them. The hardware side focuses on servers and storage; the software side, more often than not, looks at applications. Yes, applications, such as SFA (sales force automation) and even ERP.

Even though utility computing offerings continue to grow and multiply, the utility computing space is still in the pre-chasm crossing phase. A recent article in an influential trade magazine, Government Procurement, has a three page "101"-type article. For those not familiar with the English-language slang, a "101" article is an introductory-level article. Hence, there is still a lot of education that needs to be done. If you get into this space, don't expect potential customers to get it the first time. Expect that you'll need to do some hand-holding and a lot of education.

Note that server utilization is poor, about 20 percent at best; optimizing server utilization is a prime candidate for a virtualization solution. Of course, this also includes storage and pooling of storage resources. There's also a de facto fault tolerance with this approach.

The U.S. government has a Federal Enterprise Architecture (FEA) blueprint which reads a lot like a utility computing solution. It's worth reading. U.S. government agencies also need to consider Continuity of Operations Planning (COOP), although it's a pretty good strategy for many types of firms, spanning from the financial services to the chemical process industries.

Bottom line (on virtualization): Utility computing means less infrastructure, reduced costs, and more highly optimized utilization of IT resources. In the case of virtualization, with its hardware focus, the benefits apply equally to firms in China as they do to firms in the States.

Utility Computing: Software-as-a-Service

The next article was published in the January issue of one of my favorite trades, CIO Insight. It appears to have been written by Oracle's marketing department, but it wasn't. It was about the very successful arrangement between JDS Uniphase and Oracle, probably for ERP and related database hosting. (It's not exactly clear in the article.) It's a solution provided by Oracle's On Demand business unit.

There's a great line by JDS Uniphase's CIO: "Our information technology falls into two buckets, either advancing the business or running the business, and we want somebody else to do the running-the-business stuff." (My emphasis.) Yes, this says it all. It also says where firms should look for end user buy-in., NetLedger and yes, Oracle's On Demand offering are all showing respectable growth. Matter of fact, Oracle's On Demand unit "has been Oracle's fastest-growing business segment for several quarters in a row." What's more amazing is that through forty (40) acquisitions and restructurings, the JDS Uniphase business units were able to get up and running in relatively short order with their Oracle solution. Very impressive.

Bottom line (on software-as-a-service): Expect to see a lot more of this. It's the niche players, but even the larger vendors such as Oracle. And target marketing efforts at running-the-business solutions. One problem in China, however: Most domestic (in China) firms will not give up their corporate data to a third party. Hence, target Western firms in China or coming to China.

Knowledge Management

The phrase "knowledge management" is one of the most misused and misunderstood phrases in the IT industry. The way I've used it is the way most industry analysts use it, i.e., "business intelligence" is for working with structured data and "knowledge management" is for working with unstructured and semi-structured data. However, a respected analyst and author of an article titled, "Knowledge management: Reality at last?" takes a very different (and interesting) position. The article appeared in the February issue of DM Review.

The author suggests that KM is a superset of BI and incorporates BI, data warehousing, collaboration, content management and portals. He also goes on to define the "knowledge" aspect as that of turning raw data and information into something useful. He goes on to challenge the dyadic choice between top-down versus bottom-up approaches and instead proposes that KM systems should be built around communities, i.e., communities of users. For example, a firm's marketing department may be its own community, but a cross-functional product development team, which may include representatives from engineering, manufacturing and marketing, form their own community as well.

Bottom line: I'm going to stick with my definition of KM, but listen to the author's advice, i.e., "KM" systems should be built around communities and must integrate a myriad of technologies, including DW, CMS, portals and collaboration tools.

IBM's Rational Unified Process

A couple of pointers to some tools available from Baseline, another one of my favorite trades. The first is a premium subscription tool for calculating the cost of installing a workflow management system. IBM provided the data. (Unfortunately, the online version of the article is a weak rendition of the printed version. FYI, it was published in the January issue.) Another premium subscription article looks at the cost savings utilizing the RUP approach to software development. This includes another tool -- and I highly recommend this too, especially for SIs and solution providers based in China. It can help make a business case. It should be noted that the RUP approach may help firms overcome not having a CMMi-5 certification by demonstrating to prospective clients that potential fears are probably unwarranted -- assuming, of course, that the solution provider is indeed using the RUP approach.

Bottom line: The RUP approach to software development makes a lot of sense, especially for 99.9% of China's SIs and solution providers.

Accessing Podcasts

The links to the podcasts are fairly solid, but if they don't work, please check this Group's messages (or blog's archives) for an update. In all likelihood, I'll copy the files to the Internet Archive and Ourmedia. (For what it's worth, uploading to the Internet Archive from China is painfully show; several hours at best. And although I'm experimenting with Ourmedia, it's still invitation-only -- and not working very well.) I'll also be transferring my podcast hosting to libsyn, but the podcasts referenced for this post are already up on another service.

The podcast specifically for this message/post can be accessed here.
A podcast describing the mission for David on Enterprise Software can be downloaded here.


David Scott Lewis
President & Principal Analyst
IT E-Strategies, Inc.
Qingdao, China & Menlo Park, California
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