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Developing flexible, business aligned IT innovation and capability delivery strategies

After my prior LinkedIn item on when does SAP S/4 HANA make sense for your business?

I received a question through a colleague in respect of a large European client who was effectively defining a Choice A over Choice B forward IT strategy.

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This prompted me I to sit down and put some further thought into a IT Executive view of a business into IT strategy model and approach that could result after an Enterprise client makes Choice A.

A Business Domain / IT Transformation Viewpoint

Getting straight to the point, as a direct consequence, I then sketched out the following high level architectural thinking and strategic business into IT building block based approach (having further researched various recent IBM C Suite and IBM Institute of Business Value (IBV) studies) that places an effective API and Enterprise Service Bus “inner / outer ring” strategy as the key enabling capability.

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It was also interesting to read a recently (31/01/17) published summary of a study by the DSAG (German Speaking SAP User Group) which in addition to discussing various S/4 HANA adoption rates amongst the surveyed SAP DACH clients.

This study highlighted plans to significantly increase forward IT investments and focus in front office “digital transformation and business / IT enabled innovation projects” within the surveyed German and Swiss speaking / based companies (similar to Panalpina) leading in this area, with up to 60 and 70% respectively of funding being targeted at these critical area’s and “competitive advantage” or simple “stay in business” IT transformation and investment requirements vs disruptive adjacent industry or new physical “asset lite” digital disruptive competitors (Netflix vs Blockbuster retail outlets comes to mind) .

It is possible to say that a number of industries including global logistics companies naturally already have complex extended digital supply chains which are facilitated by standards based messaging, API’s, data exchange with supporting back office EAI (Enterprise Application Integration) platforms and web enabled consumer and partner .

After creating this high level model and approach I naturally started to think further the critical business into IT capabilities that are required to ensure success when implementing a business aligned IT innovation strategy of this type.

When I net these out, to me they seemed to distill into six or seven strategic IT capabilities and imperatives in combination with the profile of the individual business appetite from a forward risk / reward and rate of IT innovation and management / adoption of change point of view.

These included the business aligned development, governance and practical implementation of:

  1.  An effective API development, brand, portfolio management and delivery strategy
  2.  An effective data governance and management strategy to pool, integrate and actively manage data for trusted, timely and accurate business insight
  3. An existing, defined and working ESB (Enterprise Service Bus) application messaging platform or platform/s (I refer to this as an “inner ring / outer ring” ESB / EAI strategy)
  4. The appropriate and targeted selection of buy (& Integrate) vs build (Dev/Ops) and run application capabilities
  5. Aligned Business and IT Executive sponsorship, funding and organization / cultural factors
  6. Structured, thoughtful analyze to select the most appropriate IT capability building blocks
  7. A plan to explore, target and integrate cognitive computing, ML / AI capabilities

Crucial also is timing, as various new and emerging technologies typically traverse the Gartner “technology hype” curves (or Forrester Waves) at different speeds, with specific vendors, technologies and/or platform/s emerging to becoming a or the “de-facto” standard or dominant provider in a particular function or area.

Within this context it’s clear that some fundamental and basic “table stakes” still apply including:

  1. A real, demonstrable, sustained commitment to Open Source offerings and capabilities
  2. The selection and integration of at scale, viable “top right” quadrant platforms, products and/or technology partners
  3. Appropriate Business into IT funding to phase delivery – Start small, prove, then scale fast
  4. Understanding when to buy vs build – The Factory IT vs Competitive Advantage IT question
  5. Understanding that multi source, highly cost optimized, outsourced IT strategies are relatively unlikely to provide a firm foundation for the agile delivery of new business into IT capabilities – as Business into IT Driven “Digital Innovation Requirements” become ever more critical

Which in turn relates towards the phased evolution vs revolution question that is described and nicely summarized in a GA Moore technology model below.

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Where often within individual global enterprises various Business into IT delivery programmes will sit in different segments under the “cross the chasm” curve.

In a prior Imperial College Business Innovation course it was clear that the most successful and effective business innovation strategies and platforms (including the Apple’s iPhone), were in the majority of successful cases, actually combining proven prior individual technology components and eco system building blocks in new innovative ways.

It was the innovative new combination of these proven capabilities and technology building blocks often within new value based networks that creates the greatest and/or most disruptive business value, often not brand new or immature technology.

It was also interesting to observe a recent joint Schaeffler Group / IBM Watson IoT / Manufacturing 4.0 partnership announcement and youtube video that is grounded on a number of these principles as described below:

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In addition to a recent LinkedIn CIO / Data Management forum item that nicely described effective Data Management and IoT strategies as the “King and Queen” partners of aligned IT Innovation capabilities in the complex game of chess that is successfully implementing viable, long term IT strategies.

If these are the King and Queen I’d also then say that Hyperledger and blockchain represent the Castles in chess terms, enabling swift directed movement combined with protection and security.

Additionally in my view as described in a short you tube video about IBM’s Hyperledger blockchain pilot system within IBM Global Financing (IBM IGF process $44 Billion Dollars of transactions, within a network of 4,000 partners, suppliers, shippers, banks).

Where the implemented open source based IBM Hyperledger solution provides an “individual client ledger” neutral, secure, immutable, auditable digital asset / document and transaction supply chain without seeking to force change the participating partners back offices platforms which is costly, risky and typically has extended cycle / lead times vs speed to value.

Approximately 10 years ago a number my IBM colleagues in our Consulting, Hosting and Global Services teams invested significant time and effort in a structured review of large scale complex IBM / Client project deliveries both successful (and a few unsuccessful) to help better inform future joint projects and joint IBM / Client success.

The output of that study is as valid now, if not more so now than before (in our Hybrid Cloud, Cognitive world), in that it logically identified and confirmed what we all know to be true, but is unfortunately often ignored or lost in the heat of an early project life cycle.

In particular these structured approaches become even more important as many large, medium and small Enterprise clients seek to successfully deploy and manage relatively complex “Hybrid Cloud” scenario’s.

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The success of any significant IT initiative crucially depends upon the initial business aligned requirements definition and closely managing and defining the interfaces and hand offs between the different partners and functions that are described in a 10 box IT operating and innovation model.

With the 1st and most crucial box being the initial terms of reference and requirements definition box prior to developing a 9 box “design, build and run” model in 3 layers:

  1. The business transformation requirements, value into the application delivery layer
  2. The business application, integration and data management layer
  3. The IT Infrastructure, platform and IT service delivery layer/s

The success of this model and approach is then defined by the success (or otherwise) of carefully defining and managing the interfaces between the 9 boxes in people, culture, technology, funding, capability teamwork and strategic terms as follows:

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One of my Client IT Architect colleagues working in the Retail and Consumer products industry also recently highlighted that it’s never been more important to manage these interfaces effectively to avoid the unwelcome emergence of the “IT to IT Gaps” that will inhibit successful delivery, in combination with the critical success factor of selected and assembling proven building blocks in new innovative ways that is at the heart of the most successful Business into IT innovations:

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Where the basis rule applies more often than not, assembling proven capabilities and building blocks (using a Lego like analogy) will typically yield more predictable and effective outcomes.

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I hope this item is helpful, in highlighting the requirements and prerequisites for successful “Choice A vs Choice B” business into IT innovation delivery.

IBM provides a combination of proven scalable, virtualized building blocks for Enterprise scale SAP Hybrid or Private Cloud platform delivery including DB2 v11.1 LUW, IBM POWER8, AIX, PowerVM, Linux, IBM System z, DB2 and/or Linux One, System I with DB2.

Disclaimer: The views expressed by the author in this blog reflect 33 years of experience in Enterprise IT and ERP / Application platform delivery are my own and do not represent formal IBM views or strategies. Vendor trademarks are respected