Smarter Sourcing Today and Tomorrow

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1 Reshaping ICT, Reshaping Business Smarter Sourcing Today and Tomorrow Juan M. Porcar Senior Vice President, Services, FUJITSU CEMEA&I

2 Technology drives Services

3 and Services drive Sourcing Commercial airlines made it possible to use Jet Planes to travel long distances Electrical companies put together generation, transmission and transformation of electricity, making available to everyone was first developed in 1972, but it was the ISPs who made it available after the Internet Services became widely available In most cases, the Services-led sourcing is Customer-centric and is pay-as-you-go. 2

4 IT Technology - the Traditional Way Experts only Tailor-made Static and inflexible Stateful / Silos 3

5 IT Technology the New Way Accessible to all Commoditized Commoditise d On-demand 4 Stateless Stateless

6 The Pace of Change In the past 10 years, who benefited most from changes in your industry? 26% 31% 38% 5% Traditional Competitors My Company No Idea New Competitors Source: Gary Hamel/MCI Gallup Studie 5

7 Think Out-of-the-box Which strategy drove the success of these new competitors? 62% 31% 7% Higher level of Professionalism & Efficiency Source: Gary Hamel/MCI Gallup Studie No Idea 6 They changed the Rules of the Game

8 Looking to the Future Looking 10 years into the future: Who will be your strongest competitors? 64% 34% 2% Existing Competitors Source: Gary Hamel/MCI Gallup Studie No Idea 7 New Competitors

9 Too big to fail? 8

10 Why is a smarter Sourcing Strategy increasingly Important? Shorter IT projects, quicker ROI New sourcing options have proven market maturity Few vendors are able to consult and deliver across all options Shortage of skills on cutting edge technologies as well as legacy technologies put pressure on IT IT organization can blend own and external delivery of services Business buyers increasingly drive the buying agenda End users demand freedom of choice for there device, location, access and time Balancing tight budgets with business and end user needs 9

11 The Customer View on Sourcing Options Traditional Managed Service Outsourcing As a Service Assets Risk Customer Customer Vendor Vendor Staff Risk Customer Vendor Vendor Vendor Financial Risk Capex + Opex Capex + Opex Fixed Opex Variable Opex Type of Contract Sale + Maintenance Services Services Utility Exit Conditions N/A Bad Service / For convenience Bad Service / For convenience Short Notice Innovation None Improved Cost Improved Cost and SLA s Time-to-Market Improved Cost 10

12 The Vendor View on Sourcing Options Traditional Managed Service Outsourcing As a Service H/W Revenue One-time Fixed Schedule Fixed Schedule Linked to usage Staff Risk None Partial Full Full but shared Financial Risk Investment Recovery None after collection At contract signature time Linked to staff utilization Transition during the contract Linked to duration of contract Transition and assets during the contract Linked to duration and utilization During life of assets (many contracts) Delivery Mostly local Local and remote Local and remote Mostly remote Shared Delivery Maintenance Some Some Mostly shared 11

13 Smart Sourcing Three Things to Consider Solid future budget predictions Assessment of strategic relevance of own IT Complete transparency about IT assets and resources 12

14 Smart Sourcing Three Things to Consider Solid future budget predictions Assessment of strategic relevance of own IT Complete transparency about IT assets and resources 13

15 What Questions to Look at? Which short-, mid- and long term effects have to be considered regarding the IT budget? Where lies the ownership for investment decisions on IT? Is there a desired ratio CAPEX vs. OPEX? How can traditionally responsible parties like central IT and procurement ensure future value contribution to IT? Which insights are required to project clear future roles and resposibilities? Is neutral advice on a sourcing model appreciated? 14

16 Smart Sourcing Three Things to Consider Solid future budget predictions Assessment of strategic relevance of own IT Complete transparency about IT assets and resources 15

17 Internal Know-How Availability Example Assessment - Internal or External Sourcing? Network Backup ERP Storage CRM Security Dimensions: The Strategic Impact evaluates the relevance for the business regarding core competences and market differentiators Print Strategic Impact Internal Sourcing Desktop Helpdesk Depending on maturity and soft Factors Server External Sourcing Availability of Know How to develope and operate certain IT fields checks skills internally/externally 16

18 How to get your Infrastructure Resources? The traditional way Endless coordination with server, network, storage, OS admins Each manual installation is different High maintenance effort Complex architectures (multi-tier, SOA) make provisioning difficult The cloud way Click required configuration You get required resources automatically Install app or development environment Pay for what you use Integrate Cloud and Legacy Applications Key to cloud adoption is a skillful integration into the given IT landscape! 17

19 Fujitsu Delivers Infrastructures as a Cloud service Global Cloud Platform Consistency world-wide Highest data protection standards Based on EU law Not subject to Patriot Act Sunnyvale, CA London Neuenstadt Tokyo Singapore Sydney > 3,000 cloud customers world-wide. 18

20 Smart Sourcing Three Things to Consider Solid future budget predictions Assessment of strategic relevance of own IT Complete transparency about IT assets and resources 19

21 Asset transparency - CMDB How many servers do I have? What versions and editions are they? What applications are they hosting? Who has the permissions to access them? What isn t configured rightly? What are the Best Practices of IT Management today? What has changed recently? How does this relate to my business? Could a Service Provider do a good job? 20

22 Summary Balancing cost reduction and delivering a business solutions impact demands a smart plan More business requests will require speed, innovation and delivery quality at the same time Your competitors are advancing their strategy more frequently already No right or wrong Sourcing: Smart Sourcing Smarter Sourcing Have a word with Fujitsu! 21

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