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Help For CIOs Who Struggle With Cloud Computing

Daniel Newman

CIOs pride themselves on solving some of today’s most difficult technology issues, and cloud computing is definitely at the top of that list. The cloud presents a unique challenge because public and hybrid cloud solutions often utilize customized variables for their specific needs. Today’s CIO must focus on empowering employees, vendors, and customers with the necessary tools for a positive user experience.

Transitioning from legacy systems 

Many CIOs face the issue of transitioning from a legacy system to the cloud. For large companies, there’s usually no simple path to follow. Sure, new applications are designed for the cloud, but what about the numerous pre-existing applications that won’t adapt as easily? These pose a greater management challenge because someone has to move, kill, or consolidate each application. I encourage today’s CIOs to use their IT teams to properly evaluate each tool’s purpose, viability, and transition.

Don’t get overwhelmed by cloud security 

Cloud security continues to concern most CIOs. Security is such a complex issue because it often requires several systems tied together to cover all risk areas. Many companies depend on a medley of tools to protect against malware, antivirus, and web gateways—but it’s easy to get bogged down in the minutiae of it all.

Data loss prevention may be the number-one concern. Companies that manage health records, online transactions, and social security numbers need tools in place to halt data transfer when red flags are identified. Companies that work with sensitive data must review a cloud service provider’s security framework closely. CIOs should ask about the vendor’s standard approach to security and understand their encryption processes.

Security breaches happen—not because we store information in the cloud, but because of the way we manage the information. CIOs should spearhead security procedures, but IT teams must partner with managed service providers for training, troubleshooting, and day-to-day operations.

Industry dynamics set the stage

Over the next few years, industry dynamics will determine whether cloud outsourcing will eliminate traditional methods, hybrid outsourcing options will continue, or new processes will emerge. Cloud systems lack the maturity of traditional solutions, so CIOs are right to be cautious when deciding if and where cloud services are beneficial. Make your concerns known to the IT team, but listen to their recommendations for where cloud-based tools would be effective.

Future of new cloud services

Even though cloud-based systems lack maturity, traditional IT solutions often lack flexibility and practical adaptability. Dogmatic commitment to antiquated software slows innovation, makes solutions difficult to scale, and usually lowers profits, while cloud systems are agile and promote innovation.

Over time, service providers will likely maximize the cloud’s potential. Ingenuity is usually rife with growing pains, and managing risk through untested terms and conditions may temporarily limit service providers’ current capabilities. For CIOs to mitigate excessive costs, strategic foresight is a functional imperative. In other words, executive IT professionals should regularly evaluate the utility of cloud-based tools.

Lifecycle of services sourcing

Service sourcing requires sourcing strategies, vendor selections, contracting, and maintenance. This is its lifecycle, and it necessitates proper planning and management. Businesses using cloud IT solutions utilize all types of methods created, combined, and packaged by outsourcing services. Subsequently, a cloud provider (CSP) can deliver these services directly to the business or multiple vendors, requiring the IT team to efficiently configure the solutions for delivery.

The complete role of the cloud service provider (CSP)

Every business wants a cloud solution that increases productivity, but many organizations struggle to put these systems in place and effectively monitor them. Because of this, CSPs must provide initial client support to ensure cloud services are implemented correctly.

First, CSPs should begin with an assessment of pre-existing data infrastructures to identify the easiest functions to shift to the cloud. This move can begin immediately without disrupting current workflow. A quality CSP will walk clients through cloud options and explain their differences. This minimizes uncertainty and reduces anxiety commonly felt by CIOs and IT professionals during the adoption phase.

Second, CSPs should implement the solutions and employee training so everyone can use the new systems effectively. CSPs should address customer needs for availability, performance, and security. In other words, the CSP needs to do a lot more than simply deliver a solution. I strongly encourage CIOs and CSPs to hammer out these practical details before signing any contracts. This will eliminate a lot of potential conflict and frustration for companies moving to cloud-based computing.

This process shouldn’t be a stressful challenge for CIOs. Gaining a clear understanding of cloud strengths and weaknesses and relying on competent IT professionals to implement and provide training is critical to the successful implementation of cloud solutions.

 

This post was brought to you by IBM Global Technology Services. For more content like this, visit Point B and Beyond.

The post Help for CIOs Who Struggle With Cloud Computing appeared first on Millennial CEO.

photo credit: Hong Kong International Finance Center via photopin (license)

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About Daniel Newman

Daniel Newman serves as the Co-Founder and CEO of EC3, a quickly growing hosted IT and Communication service provider. Prior to this role Daniel has held several prominent leadership roles including serving as CEO of United Visual. Parent company to United Visual Systems, United Visual Productions, and United GlobalComm; a family of companies focused on Visual Communications and Audio Visual Technologies. Daniel is also widely published and active in the Social Media Community. He is the Author of Amazon Best Selling Business Book "The Millennial CEO." Daniel also Co-Founded the Global online Community 12 Most and was recognized by the Huffington Post as one of the 100 Business and Leadership Accounts to Follow on Twitter. Newman is an Adjunct Professor of Management at North Central College. He attained his undergraduate degree in Marketing at Northern Illinois University and an Executive MBA from North Central College in Naperville, IL. Newman currently resides in Aurora, Illinois with his wife (Lisa) and his two daughters (Hailey 9, Avery 5). A Chicago native all of his life, Newman is an avid golfer, a fitness fan, and a classically trained pianist

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Smart Machines Create Markets For Cyber-Physical Advances

Marion Heindenreich

Today, industrial machines are more intelligent than ever before. These intelligent machines are changing companies in many ways.

Why smart machines?

Mobile networked computers were a key breakthrough for making smart machines. Big Data allows machines and computers to store information and analyze complex patterns. Cloud computing offers broad access to information and more storage.

These computerized machines are both physical and virtual. Some call them “cyber-physical” machines. Technology lets them be self-aware and connected to each other and larger systems.

Businesses change their approaches

Intelligent machines allow companies to innovate in many areas. For one, the value proposition for customers is evolving. Businesses now model and plan in different ways in many industries.

Makers of industrial machines and parts work in new ways within the organization. Engineering now partners with mechanical, electronic, and software staff to develop new products. Manufacturing now seamlessly ties what happens on the shop floor to the customer.

Service models are changing too. Scheduled and reactionary servicing of machines is fading. Now intelligent machines track themselves. Machines detect problems and report them automatically. Major problems or failures are predicted and reported.

A data mining example

One good industrial example is mining, which can be dangerous and difficult. As ores become scarce, the costs of mining have increased.

“Smart machines” started in mining in the late 1990s. Software and hardware let remote users change settings. Operators moved hydraulic levers from a safe distance. Sensors observed performance and diagnosed issues.

Data cables connected machines to computers on the surface. Continuous and remote monitoring of the machines grew. Over time, embedded sensors helped improve monitoring, diagnostics, and data storage.

The technology means workers only go underground to fix specific issues. As a result, accident and injury risk is lower.

New wireless technology now lets mining companies connect data from many mine sites. Service centers access large amounts of data and can improve performance. Maintenance is prioritized and equipment downtime is reduced.

Opportunity abounds

For companies the time is now. Today, mobile “connected things” generate 17% of the digital universe. By 2020 that share grows to 27%.

You might not be investing in this so-called “Internet of Things” (devices that connect to each other). But it’s a good bet your competitors are. A December 2015 study reported 33% of industrial companies are investing in the Internet of Things. Another 25% are considering it.

There are risks

This new dawning era of manufacturing is exciting. But there are concerns. Cyber attacks on the Internet of Things are not new. But as the use of intelligent machines grows, the threat of cyber attacks in industry grows.

Data confidentiality and privacy are concerns. So too are software and hardware vulnerabilities. Exposure to attack lies not just in the virtual space but the physical too. Tampering with unattended machines and theft pose serious risk.

To address these threats, industries must invest in cybersecurity along with smart machines.

Conclusion

The potential advantages of smart machines are staggering. They can reshape industries and change how companies produce new products and create new markets.

For more information, please download the white paper Digital Manufacturing: Powering the Fourth Industrial Revolution.

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Marion Heindenreich

About Marion Heindenreich

Marion Heidenreich is a solution manager for the SAP Industrial Machinery and Components Business Unit who focuses on solution innovations like Product Costing on SAP HANA and cloud solutions, as well as providing financial and business analysis for industry business strategy definition and business planning.

Mining Firms Turn To Tech

Ruediger Schroedter

Gone are the days in mining when assessments of potential dig sites meant lots of waiting for results. Gone, too, is the uncertainty on a mine job about where to go next.

For mining executives, recent advances in digital technology allow companies to make decisions at a rapid pace. Decisions that used to take days and weeks now can be done in minutes and hours.

With more information available faster, mining leaders reduce both short- and long-term financial risk. Data from across the enterprise inform decisions about buying and selling assets. Profitability should increase, driven by key technology advances.

Digging in to the data

There are two key drivers to this digital revolution. The first is the rise of the Internet of Things (IoT). The IoT consists of devices that are equipped with sensors, software, and wireless capabilities. These devices are connected to each other and can detect, store, and send data.

Bonus: Click here to learn more about Digital Transformation in Mining.

The second is the rise of Big Data, mobile, and cloud computing. Today’s mobile devices can track, send, and receive data from remote sites worldwide. Cloud computing stores billions of bytes of data at low cost. Big Data analytics programs take data coming from many different locations and systems and synthesize it. Those programs then better inform decisions by offering dashboards, metrics, and predictive modeling.

Robots are able to venture into hazardous areas and move material with remote human oversight. On-site mining data is sent via mobile phone to a cloud-based platform. For mining, the convergence of these technologies provides extraordinary possibilities.

Technology at play

The potential impact is significant. A recent report by McKinsey & Co. showed the use of advanced analytics in mining and related industries had a major impact. Firms using these programs to assess production areas increased their profit margins by 2-3 percentage points.

One mining company used so-called Monte Carlo simulations to reduce certain capital expenses. Monte Carlo simulations use complex algorithms and repeated random sampling to model possible outcomes. They’re frequently used in finance, biology, and insurance. The Mining Journal reported how the company challenged assumptions about a project’s capital needs. It took historical data on certain disruptions such as rainfall patterns. Then models of its mines were made showing the impact of flooding and rainwater. The data led to a new strategy that maximized storage capacity and handling across all its mines. Capital costs dropped by 20 percent.

18 Aug 2012, South Dakota, USA --- USA, South Dakota, Lead, View of open pit --- Image by © Bryan Mullennix/Tetra Images/Corbis

Buy or sell?

With so many variables at play, mining valuation is not for the faint of heart. Integrated data streams available at the discovery stage make for better informed purchase decisions.

Software programs today can take data to build and validate exploration models. These programs use 3D visualization and validated geophysical, analytical, and drill hole data. In turn, detailed 3D topographical models are possible.

Other programs assess historical, assay, and drilling data. This information creates viable scenarios for determining whether to buy or sell a site.

These tools use data consistently from one potential site to the next, allowing for forecasting of economic risk that is consistent across the organization. The firm today can use “real options valuation” to develop models of outcomes given changing economic conditions. With clearer information about potential risks, firms can decide whether to stage, sell, abandon, expand, or buy.

Anticipating, not reacting

Mining companies realize today that these analytic platforms and dashboards offer many advantages. Users have a clearer interpretation of the aggregated and analyzed data points from multiple areas. Using predictive analytics, mining decisions are made based on smart assumptions, not past historical information.

Robust software programs can generate reports almost instantaneously. Supervisors have on-site access to the analysis through a web browser or app. This data has many uses. Drilling managers save time and can make quicker decisions on next moves. Supplies can be ordered faster. Needed data for accreditation and compliance is immediately accessible.

Selecting the right sites

One example is assay analysis. Today, geologists do not wait weeks or months for assay results. Instead of off-site analysis, web-based applications deliver information much faster to inform decisions.

Robots are sending information about field operations, safety, needed maintenance, and drilling performance.  Some devices send the information themselves. In other cases, staff use mobile phones, tablets, or laptops.  This information and analytics in turn help with site selection. Integrating data from mine planning, ventilation, safety, rock engineering, and mineral resources improves overall forecasting.

Discovery, particularly of Tier 1 sites, is an increasingly costly venture for mining companies. Demand for many products is increasing while discovery rates are dropping. Mined product is of a lesser quality, particularly in mature mining locations. Many possible sites are in areas that are underexplored areas with difficult and deep cover.

The advanced technologies available today are contributing to rapid improvement in these discovery issues.

Prospective drilling

Consider the drill hole. To reduce costs in exploration, there needs to be enough rich information from the opening drill hole. It needs to be delivered in as close to real time as possible. Doing so lessens the risk of the second drill hole. Better information from the start helps improve vectoring. It provides better information about what mineral systems are being drilled.

This approach, called prospective drilling, is becoming increasingly used in mining. It employs drilling activity to map covered mineral systems. In turn, geochemical and geophysical vectoring can lead firms toward deposits.

Australia has invested heavily in this area. The Deep Exploration Technologies Cooperative Research Centre (DET CRC) has a singular vision: uncovering the future. Its core purpose is “develop transformational technologies for successful mineral exploration through deep, barren cover rocks.”

To get to that point, the DET CRC is borrowing a drilling technique from the oil business. Coiled tubing is paired with downhole and top-of-the-hole sensors. The informaton provides petrophysical, structural, rock fabric, geochemical, and mineralogical data all at once.

Conclusion

To meet increasing demands for new viable sites, and to improve efficient on sites, mining is changing. Using smart, connected products and robust data modeling, mining is being done faster, safer, and more efficiently than ever.

Join a LiveTwitterChat on digitalization in mining on May 4th from 10-11 a.m. EST: #digitalmining

The global mining and metals industry will come together to discuss how digital innovation is impacting the mining industry July 12-14 at the International SAP Conference for Mining and Metals in Frankfurt, Germany.  Don’t miss this opportunity to meet with world leaders and learn how your organization can become a connected digital enterprise.

Follow speakers and pre-event activities by following sapmmconf and @sapmillmining on Twitter

AA Mining and Metals Forum

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Ruediger Schroedter

About Ruediger Schroedter

Ruediger Schroedter is responsible for solution management of SAP solutions for the mining industry worldwide. He has spent more than 15 years in the mill products and mining industries and has extensive experience implementing SAP solutions for customers in these industries before coming to SAP.

How Much Will Digital Cannibalization Eat into Your Business?

Fawn Fitter

Former Cisco CEO John Chambers predicts that 40% of companies will crumble when they fail to complete a successful digital transformation.

These legacy companies may be trying to keep up with insurgent companies that are introducing disruptive technologies, but they’re being held back by the ease of doing business the way they always have – or by how vehemently their customers object to change.

Most organizations today know that they have to embrace innovation. The question is whether they can put a digital business model in place without damaging their existing business so badly that they don’t survive the transition. We gathered a panel of experts to discuss the fine line between disruption and destruction.

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qa_qIn 2011, when Netflix hiked prices and tried to split its streaming and DVD-bymail services, it lost 3.25% of its customer base and 75% of its market capitalization.²︐³ What can we learn from that?

Scott Anthony: That debacle shows that sometimes you can get ahead of your customers. The key is to manage things at the pace of the market, not at your internal speed. You need to know what your customers are looking for and what they’re willing to tolerate. Sometimes companies forget what their customers want and care about, and they try to push things on them before they’re ready.

R. “Ray” Wang: You need to be able to split your traditional business and your growth business so that you can focus on big shifts instead of moving the needle 2%. Netflix was responding to its customers – by deciding not to define its brand too narrowly.

qa_qDoes disruption always involve cannibalizing your own business?

Wang: You can’t design new experiences in existing systems. But you have to make sure you manage the revenue stream on the way down in the old business model while managing the growth of the new one.

Merijn Helle: Traditional brick-and-mortar stores are putting a lot of capital into digital initiatives that aren’t paying enough back yet in the form of online sales, and they’re cannibalizing their profits so they can deliver a single authentic experience. Customers don’t see channels, they see brands; and they want to interact with brands seamlessly in real time, regardless of channel or format.

Lars Bastian: In manufacturing, new technologies aren’t about disrupting your business model as much as they are about expanding it. Think about predictive maintenance, the ability to warn customers when the product they’ve purchased will need service. You’re not going to lose customers by introducing new processes. You have to add these digitized services to remain competitive.

qa_qIs cannibalizing your own business better or worse than losing market share to a more innovative competitor?

Michael Liebhold: You have to create that digital business and mandate it to grow. If you cannibalize the existing business, that’s just the price you have to pay.

Wang: Companies that cannibalize their own businesses are the ones that survive. If you don’t do it, someone else will. What we’re really talking about is “Why do you exist? Why does anyone want to buy from you?”

Anthony: I’m not sure that’s the right question. The fundamental question is what you’re using disruption to do. How do you use it to strengthen what you’re doing today, and what new things does it enable? I think you can get so consumed with all the changes that reconfigure what you’re doing today that you do only that. And if you do only that, your business becomes smaller, less significant, and less interesting.

qa_qSo how should companies think about smart disruption?

Anthony: Leaders have to reconfigure today and imagine tomorrow at the same time. It’s not either/or. Every disruptive threat has an equal, if not greater, opportunity. When disruption strikes, it’s a mistake only to feel the threat to your legacy business. It’s an opportunity to expand into a different marke.

SAP_Disruption_QA_images2400x1600_4Liebhold: It starts at the top. You can’t ask a CEO for an eight-figure budget to upgrade a cloud analytics system if the C-suite doesn’t understand the power of integrating data from across all the legacy systems. So the first task is to educate the senior team so it can approve the budgets.

Scott Underwood: Some of the most interesting questions are internal organizational questions, keeping people from feeling that their livelihoods are in danger or introducing ways to keep them engaged.

Leon Segal: Absolutely. If you want to enter a new market or introduce a new product, there’s a whole chain of stakeholders – including your own employees and the distribution chain. Their experiences are also new. Once you start looking for things that affect their experience, you can’t help doing it. You walk around the office and say, “That doesn’t look right, they don’t look happy. Maybe we should change that around.”

Fawn Fitter is a freelance writer specializing in business and technology. 

To learn more about how to disrupt your business without destroying it, read the in-depth report Digital Disruption: When to Cook the Golden Goose.

Download the PDF (1.2MB)

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Creating A New Employee Experience: Is HR Turning The Corner?

Estelle Lagorce

Businesses and workforces in every industry continue to face major disruption. HR has sometimes struggled to keep up with the accelerating pace of change, yet 2016 could mark a turning point. Although there’s still a long way to go, Deloitte’s new Global Human Capital Trends report shows that HR is now making impressive strides in innovation, reskilling, and adapting to changing workforce and business demands.

So how can HR take the lead in this exciting digital business world? Where are the best opportunities to drive business growth? What capabilities and skills will be needed in the future? In the first of a series of blogs, we focus on one of the key trends driving HR transformation: the growing importance of design thinking in crafting the employee experience.

Focus on the person, not the process

Today’s employees are already inundated with a flood of e-mails, messages, and meetings – so the last thing they want are HR processes that add to the burden. And with the huge growth in mobile devices, they’re also accustomed to interacting with technology in a way that is simple, intuitive, and pleasurable. So it’s not surprising that 79% of executives in this year’s Global Human Capital Trends survey rated design thinking – which puts the employee experience at the center – an “important” or “very important” issue (see figure 1).

Transform HR Figure1 People Analytics

Figure 1: Design thinking: Percentage of respondents rating this trend “important” or “very important”  

In simple terms, design thinking means focusing on the person and the experience, not the process. The key question that HR needs to ask is: “what does a great employee experience look like from end to end?” That means studying people at work and creating “personas” and “profiles” to understand their demographics, environment, and challenges. This implicitly drives a more thoughtful and human approach to business that makes the workplace more attractive to existing and future employees. “Design thinking really is about reevaluating the way HR is being done in the context of the employee experience,” explains Erica Volini, leader of Deloitte Consulting LLP’s HR Transformation Practice.

But does it work? The data from this year’s survey certainly points that way. Companies growing by 10% or more a year are more than twice as likely to report that they are ready to incorporate design thinking, compared to their counterparts who are reporting stagnant levels of growth. Design thinking can also make a huge difference in how companies are perceived, which is crucial in recruiting and retaining the right people. Done well, design thinking promotes a virtuous cycle: generating higher levels of employee satisfaction, greater engagement, and higher productivity for the company.

Learn more

Deloitte’s Global Human Capital Trends 2016 is one of the largest global surveys of its kind, with 7,000 HR and non-HR respondents covering a wide range of industries across 130 countries. “Every single industry is being disrupted; that’s the theme that resonates through the report,” says Erica Volini. “There’s a real opportunity for HR to use this report to change the dialog and make it about what’s happening in the business and ideas to move forward.”

To find out more about HR transformation trends, priorities, and practices:

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Estelle Lagorce

About Estelle Lagorce

Estelle Lagorce is the Director, Global Partner Marketing, at SAP. She leads the global planning, successful implementation and business impact of integrated marketing programs with top global Strategic Partner across priority regions and countries (demand generation, thought leadership).