LAC 2017 - Turning the Digital Insourcing Tide
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With digitization, agile and DevOps in mind organizations are looking at insourcing previously outsourced IT services. To bring control closer to the business. IT service providers and IT departments need to reposition themselves to remain relevant.
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LAC 2017 - Turning the Digital Insourcing Tide
- 1. Turning the Digital Insourcing Tide Enterprise Architecture in the Digital Era Har Gootzen Landelijk Architectuur Congres Den Bosch, 17-11-2017
- 2. 2Presentation Title | Author | Date © 2017 Capgemini. All rights reserved. 01 02 03 04 05 Digital Insourcing? Game Changers in Outsourcing New Business & IT Models Role of the IT & Enterprise Architect Final Thoughts Content
- 4. A successful deployment requires a comprehensive, modern Service Management solution. Business Interface Supplier Management Apps Management Infra Management Service Management Outsourcing Digital Insourcing Business Interface Service Level and Performance Management Service Integration Apps Tower Infra Tower Tower Management Tower Management Tower Sourcing Business Enablement Agile Sourcing Service Store Orchestration for Business Legacy Towers Encapsulated Services Tower Management Service Aggregation IaaS PaaS SaaS Micro Sourcing
- 5. A successful deployment requires a comprehensive, modern Service Management solution. Digital Insourcing The pace is slowing and deal scope is shrinking. Why? • The need for closer integration with the business in order to drive innovation; • Increasing adoption of Agile; • CIO’s reclaiming the margin paid to suppliers and service providers;
- 6. 6© 2017 Capgemini. All rights reserved. From Cost Driven to Revenue Driven Digital Transformation can drive IT transformation but requires a change in IT business. IT transformation cannot drive Digital Transformation. IT Transformation IT Business Transformation Digital Transfor- mation
- 7. 3 Pillars for IT as business partner for digital innovation • From a Device-Based Strategy to a User-Centric Approach; • Gain Power and Centralize Data; • Speed Time to Market with Infra as Code, APIs, Containers and DevOps Methodologies Business Challenge Enabling Infrastructure Innovation Basic Need Must Have Project Priority Digital Workplace BI & Analytical Platform Digital Devops Factory Boost Employee Satisfaction and Production Extract Value from data and integrate new sources with IOT New applications Time to Market
- 8. Game Changers for IT Outsourcing
- 9. The Cloud Debate is over! McKinsey, 2016 43 77 67 57 49 49 38 57 34 54 25 Traditional Virtualized On-premise Private Cloud Dedicated Private Cloud Virtual Private Cloud Public IaaS 37 2015 2018
- 10. 10Presentation Title | Author | Date © 2017 Capgemini. All rights reserved. “DevOps applies agile principles to IT Operations” ……including Infra!
- 11. <infra/> GitCI Server <app/> Application CodeInfrastructure Code Programmatic and abstract infrastructure Build and Deploy CI Single repository for version control on source code Programmatic Infrastructure
- 12. “You Built It, You Run It” Werner Vogels, CTO / Amazon
- 13. Hybrid Cloud Cloud Native “Today 15% of Apps are cloud native, by 2020 this will be 32%” “Containers are the holy grail of virtualization”
- 14. 14Presentation Title | Author | Date © 2017 Capgemini. All rights reserved. Onshore Labor 100 k€/yr Offshore Labor 38 k€/yr Digital Labor 13 k€/yr Automation is the Next Generation Transformation Lever
- 15. 15Presentation Title | Author | Date © 2017 Capgemini. All rights reserved. IT Outsourcing will become a software business “Forget virtualization: it's all about automation"
- 16. 16Presentation Title | Author | Date © 2017 Capgemini. All rights reserved. The Frontier Between Application Landscape and Infrastructure is to disappear first. Infrastructure will become an abstracted concept; Vanishing Domain Frontiers B I IS TI B I IS TI Why? What? How? With What? <infra/> Increased Convergence of Architecture Domains to reduce/remove Silos
- 17. New Business and IT Models
- 18. 18Presentation Title | Author | Date © 2017 Capgemini. All rights reserved. The IT industry is driven by two structural forces working in opposite directions: industrialization and innovation.
- 19. Sourcing Lifecycle and Architecture • Solution Architecture • Project Start Architecture • Joint iteration of the Solution Architecture • Consultancy / Advice • Projects PROVIDER Sourcing Strategy Selection Transition Transformation Delivery Contract Ending Decision • Enterprise IT Architecture • Scoping / Sourcing Start Arch. • Governance Structure • Joint iteration of the Solution Architecture. • Iteration of the Enterprise Architecture • Adjusted Architecture Principles report CLIENT • Outsourcing Strategy • Insourcing Strategy Continuous innovation
- 20. Actions for providers to reverse the insourcing trend Enhance Domain Capabilities Explore Synergies, Be a partner Focus on Emerging Technologies Tap Diverse Markets
- 21. Customers want business solutions that hide the internal complexity of the provider Digital CX Cloud Security Business services Software Assets Bank of the future Digital Commerce Digital Store Concept …
- 22. Role of the Architect
- 23. 23Presentation Title | Author | Date © 2017 Capgemini. All rights reserved. Not invited to the “Digital Party”? No….this is a “Digital” Party! Hey folks, I am the Enterprise Architect. Can I join? Enterprise Architect
- 24. But …..when digital is high on the agenda, the complexity of IT Architecture Increases! Number of point-2-point connections Quality of business- process documentation 1=low, 5 =high Number of services that are reused 46 66 3. 2,7 55 36 Source: Enterprise Architecture Study, McKinsey and Henley Business School Feb. 2016 Digital is low on the agenda Digital is high on the agenda
- 25. 25Presentation Title | Author | Date © 2017 Capgemini. All rights reserved. ... But don’t go overboard with agile So …. don’t go overboard with Agile! Big Up-Front Architecture Many traditional projects Good Agile Architecture is part of the features that are built into the sprints Bad Agile Zero Architecture / NAAA is bad practice
- 26. 26Presentation Title | Author | Date © 2017 Capgemini. All rights reserved. Intentional Architecture Enabler feature • Just Enough / Just in Time Architecture; • Only in support of upcoming features defined by business epics and related architecture epics; Hence …. The Architectural Runway
- 27. The operational scaling level represents the basis of an Agile Organization by ensuring that self-managed teams, regularly deliver customer-oriented features The strategic scaling level allows several units to work on different product while being aligned with common strategic goal The tactical scaling level allows multiple teams to work together independently on one product while being fully aligned to the product vision ScalingLevel Portfolio Portfolio Vision Program Integrated Product Vision Team Product Vision Becoming an agile organization means living the same values on portfolio level that also work for the team level Enterprise Architecture Agile Architecture
- 28. "It is not the strongest of the species that survives, nor the most intelligent. It is the one that is most adaptable to change." Charles Darwin Final Thoughts – We are in the Age of digital Darwinism You can draw your own conclusion ….
- 29. With more than 190,000 people, Capgemini is present in over 40 countries and celebrates its 50th Anniversary year in 2017. A global leader in consulting, technology and outsourcing services, the Group reported 2016 global revenues of EUR 12.5 billion. Together with its clients, Capgemini creates and delivers business, technology and digital solutions that fit their needs, enabling them to achieve innovation and competitiveness. A deeply multicultural organization, Capgemini has developed its own way of working, the Collaborative Business Experience™, and draws on Rightshore®, its worldwide delivery model. About Capgemini Learn more about us at www.capgemini.com This message contains information that may be privileged or confidential and is the property of the Capgemini Group. Copyright © 2017 Capgemini. All rights reserved. Rightshore® is a trademark belonging to Capgemini. This message is intended only for the person to whom it is addressed. If you are not the intended recipient, you are not authorized to read, print, retain, copy, disseminate, distribute, or use this message or any part thereof. If you receive this message in error, please notify the sender immediately and delete all copies of this message.
Editor's Notes
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- IT business transformation is a thorough or dramatic change in the technologies and business processes a company employs to reach important business goals. The term represents a shift in the role of technology beyond just business process management and business-IT alignment to that of IT business integration -- creating a work environment in which the IT department and the CIO are not merely installing technology to support business processes but are also using technology to shape business strategy.
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- The decision to opt for a private or public cloud involves such factors as: Access to innovation Amount of workload Workload Uptime Security level acceptance The decision to opt for a private or public cloud involves such factors as: Access to innovation Amount of workload Workload Uptime Security level acceptance
- Finally, robotic process automation could be a game changer for IT operations. Cognitive computing systems are highly applicable for run operations such as: Monitoring operations (e.g., events or security monitoring) through application log analysis Service desk (e.g., robot chat, deep learning) A simple price equation highlights the potential savings:
- While virtualization has been the original enabler of cloud it is now much more about standardization and automation. Though virtualization was a historic enabler of cloud computing, it is now not the only one. Today, containers and configuration management automation solutions such as Chef, Puppet and Ansible, which manipulate Infra as Code, are credible alternatives for fostering the Cloud: hence, these delivery models can also be deployed on “ bare metal ” servers
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- Explore Synergies, be a Partner not a Service Provider Rather than being just Service providers, companies need to be in synergy with the client’s mission, vision and values. The change in business needs of the clients need to be proactively identified and addressed. Identifying new opportunities around client’s business and leveraging latest technologies would result in being a partner rather than not only a service provider Enhance Domain Capabilities Nowadays, clients are looking for flexible partners who could add value to their business by bringing innovations in the business processes. This would require a deep knowledge of the client’s domain and suggest improvements. To address this, companies should invest in Business Process Management tools, where the processes can be codified and simulated to suggest any business process improvements. Focus on Emerging Technologies With the rapid advent of technology it is becoming increasingly difficult for outsourcing companies to cope up with it. SMAC, IOT, Augmented reality, Bluetooth beacons, wearable and many smart technologies are playing a critical role in formulating business strategy and evolution of business models. The Digital transformation is the next big thing and it needs technology expertise which an outsourcing firm may not have. That should be the focus of IT companies. Tap Diverse Markets IT service providers should focus on diverse markets, which would bring down the risk of insourcing or Reshoring. Along with diversifying markets, companies should focus on differentiation of the service provided by introducing flexible business models and capitalizing on emerging trends in the business. For instance, manufacturing companies are shifting focus from product centric to service centric, Servitization, which provide wide opportunities for IT service providers to tap. Also it would be a good idea to explore new markets and new industries.
- There doesn’t need to be a big waterfall process where the majority of the architecture is done up front, but architecture does need to be a part of the features that are built into sprints. There needs to be a roadmap about the architecture and its features.
- Architectural Runway is the existing technical infrastructure, instantiated in code, necessary to support the implementation of upcoming features without excessive, delay-inducing, redesign. Each Release Train endeavors to continuously extend the Architectural Runway so as to be sufficient to support the successful implementation of features over the next one to two Program Increments. An architectural runway is a backlog maintaining the priorities of the product from an architectural point of view. It reflects the "-ilities" of a product, such as scalability, maintainability, usability, reliability, extensibility, security, reusability.
- We are living in an evolving world and for many, a new world. The challenge you all face is how you can help your companies to adapt to the changing world we live in. The old ways are going. We need agility. We need speed. We need change. We need to be smarter in how we help our companies build new applications and disrupt our industries. We want to be the disrupter, not the disrupted. This is YOUR opportunity to make a difference. Without YOU, your companies will fail. [Click]