Download - Trends but No Directions

Nordic Region Technical ConferenceOslo, May 2006

Michael Erichsen, CSC

Trends, but No Directions?IT in the Age of Globalization

GUIDE SHARE EUROPEMay 2006 2

Purpose of this Presentation Not really to answer questions, but to try to ask them CAUTION: The speaker does NOT necessarily have any deep knowledge in

the areas discussed The presentation consists mainly of unsubstantiated statements,

unfounded prejudice, and loose claims ripped off the Internet A complete literature list would be longer than the presentation But perhaps we could draw some perspective and inspiration

when considering the many confusing trends The thoughts, opinions, and considerations are the speaker’s own,

and not necessarily those of his company or of the GSE Steering Committees


Paradigm Shifts and Foresight “Paradigm Shifts” is a way of discussing changes in

the past by grouping them on a high level “Foresight” is a technique used by Governments and

Universities to build scenarios to help them choose policies to further their aims and strategies

Why are such methods important? They can help us better understand the trends that affect our

countries, our companies, and the future of each of us



Paradigm Shifts


What’s a Paradigm?


Scott Adams’ Own Comment

If you can say “Well, we are going to do a paradigm here. We're looking at different models. We'll run a few simulations and put this together to see if we can get a consensus.”

That sounds much better than “I don't know”


Brother, Can You Paradigm?

Thomas S. Kuhn: The Structure of Scientific Revolutions (1962):

Scientific advancement is not evolutionary A series of peaceful interludes punctuated by intellectually

violent revolutions, where one conceptual world view is replaced by another

A Paradigm Shift is a change from one way of thinking to another It's a revolution, a transformation, a sort of metamorphosis. It just

does not happen, but rather it is driven by agents of change As paraphrased by professor Frank Pajares


Some Paradigm Shifts

Offshoring labour intensive work → Automation & Back-shoring → Offshoring automated work

“EDP” a part of accounting → IT a strategic resource → dot.com → Cost containment → Innovation

Batch → On-line → Client/Server → Web → SOA Decoupling of operating system, data, business processes, presentation,

business rules Data Centric ↔ Process Centric Data Entry ↔ Case Work Stationary → Mobile Centralized ↔ Decentralized Top-Down ↔ Bottom-up ↔ Meet in the middle


Details and the Complete Picture


No attempt made to explain “Everything”

A theory has to be simpler than the data it explains, otherwise it does not explain anything Gottfried Wilhelm Leibniz

in “Discours de métaphysique”, 1686, paraphrased by Gregory Chaitin


Offshoring of Manufacturing In the 1950’es manufacturing boomed, and workers were drawn

from the countryside to the factories In the 1960’es workers were imported from abroad In the 1970’es manufacturing was exported to the third world

“Footloose” industries, Free Trade Zones Automation and robots demanded highly skilled workers

Some manufacturing was “backshored” In the 1990’es a highly skilled Chinese workforce entered the

world market, and almost all manufacturing was re-offshored Important to note that this has been a non-linear process The consequences in Europe: Marginalization of unskilled labour

(to a high degree affecting imported workers and their children). Fear of globalization (“Fortress Europe”)


The Role of Information Technology IT entered companies as Data Processing (EDP), a subset of the

accounting department Faster file handling, better calculations

As IT matured, and IT departments became more ambitious, they promoted IT as a strategic resource Seen by upper management as a trick to gain power

During the dot.com bubble, everybody rushed into e-something ERP, CRM, SCM, EAI, Web…

The bubble burst, and cost containment ruled IT must support cost cutting – and take a lot of cutbacks itself

Now focus is moving back from the bottom line to the top line IT now must support Innovation to help companies compete


Innovation is not the Same as Creativity

"Innovation… is generally understood as the introduction of a new thing or method… Innovation is the embodiment, combination, or synthesis of knowledge in original, relevant, valued new products, processes, or services.“ (Luecke & Katz, 2003)

"All innovation begins with creative ideas… We define innovation as the successful implementation of creative ideas within an organization. In this view, creativity by individuals and teams is a starting point for innovation; the first is necessary but not sufficient condition for the second". (Amabile et al, 1996)

"Innovation, like many business functions, is a management process that requires specific tools, rules, and discipline." (Davila et al, 2006)

Definitions taken from Wikipedia


Tools to Promote Innovation


Six Myths of Creativity

Myth Research Results (Teresa Amabile, Harvard)Creativity Comes From Creative Types

Anyone with normal intelligence is capable of doing some degree of creative work

Money Is a Creativity Motivator The handful of people spending a lot of time wondering about their bonuses were doing very little creative thinking

Time Pressure Fuels Creativity Creativity requires an incubation period; people need time to soak in a problem and let the ideas bubble up

Fear Forces Breakthroughs People are more likely to have a breakthrough if they were happy the day before

Competition Beats Collaboration When people compete for recognition, they stop sharing information

A Streamlined Organization Is a Creative Organization

People's fear of the unknown led them to basically disengage from the work


The Computing Platform

Aiken’s Law, 1947: “Only 6 computers needed to perform all calculations in the US”

Batch → On-line → Client/Server/ERP/CRM → Web → SOA → POA? EDA? Something completely different?

Driven by forces like Technical inventions Globalization Business changes like mergers

and acquisitions Changing expectations by users,

customers, and partners


Decoupling

The first systems were tightly coupled Operating System-Data-Business Logic-Presentation monoliths

Operating systems and applications were separated Data was separated using database management systems

(network, hierarchical, relational etc.) Presentation was separated using client/server, GUI, and Web

Interfaces Application components were decoupled from each other using

APPC, EDI, RPC, RMI, and Web Services/SOAP Business rules, processes, and control logic were separated using

Business Process Management Systems


A Counter-Trend to Decoupling Case tools in the 1990’es like IEF/COOL:Gen derived

applications and data so strongly from business models that data was effectively owned by specific applications This is a problem for current reengineering projects, because an

enterprise data model is difficult to implement Shrink-wrapped ERP packages like SAP and Siebel is a new

generation of monoliths In practical life you cannot access or understand SAP relational data

outside the SAP system SAP opens up to SOA architectures by defining itself as the core

and providing the ESB


The Data Centric Paradigm The Data Centric paradigm was driven by Database Management

systems and decoupling of data Built on a mathematical basis: Set Theory founded by Georg Cantor Modelling starting from enterprise “master data”

Identities and attributes of customers, products, employees, and other core reference data

Implemented in CRM, ERP, and other Shrink-wrapped systems of the 90’es Backed by vendors like Oracle and SAP

Business Intelligence, OLAP, Data Mining, ETL, etc. can discover new information from non-obvious patterns in large sets of data

Object orientation enhanced data with its inherent methods Metadata makes data more independent of single applications

XML an excellent medium Including both structured data (Databases) and unstructured data (email,

Office documents)


The Process Centric Paradigm The Process Centric paradigm was driven by recent business changes,

SOA technologies and decoupling of processes Built on a mathematical basis: π Calculus founded by Robin Milner et

al. The processes of the enterprise is seen as the most important aspect

Sees databases as a place, where state is kept, when lights are out Focus is moving to innovation First generation SOA projects are often mainly technical integration

projects Service-enablement of legacy systems and SOAP-interfaces exposes

functionality as services and prepares combination into business processes that can be dynamically reconfigured

BPM systems are maturing and integrating with SOA technologies


No More Waiting Rooms? Customers waiting in line,

spending hours in waiting rooms, or rusting on telephone queues are no longer deemed acceptable

Office staff changes from data entry clerks to case officers, handling a case or a client “from cradle to grave”

This drives continuous improvement of processes, higher degrees of automated and IT-supported processes, integration between systems, and self service


Computer Terminals become Mobile

Teletype Terminals → green screens → GUI → handheld terminals/PDA’s/mobile phones etc.

Gartner predicts that in the future everybody will only have laptops – and that we will have to pay for them ourselves, since we also use them for private purposes This sounds like a hit

among company chief financial officers


Centralize or Decentralize This set of paradigms has

regularly shifted back and forth

And will probably continue to do so


Where to Start your Design Projects

The discussion about Top-Down or Bottom-up has been running for years

Top-Down puts the business needs in focus Bottom-Up provides robust building blocks to build any

application needed, and includes the possibility of buying 3rd party components

The Business Process-Service Oriented design is becoming popular by combining into “Meet in the Middle”

Business Process Analysis and Modelling should be guiding your services design



Foresight


What is Foresight?

Foresight covers activities aiming at thinking debating shaping the future

The driver is the complexity of science, technology and society interrelationships, the limitation of financial resources, and the increasing rate of scientific and technological change


Thinking, Debating, and Shaping the Future Forecasting, technology assessment, future studies and other

forms of foresight try to identify long term trends and thus to guide decision-making Foresight aims at identifying today's research and innovation

priorities on the basis of scenarios of future developments in science and technology, society and economy

Foresight is a participative process involving different stakeholders Methods include academic studies, panels, and working groups

Foresight aims at identifying possible futures, imagining desirable futures, and defining strategies Results are generally fed into public decision-making, but they also

help participants themselves to develop or adjust their strategy


Business Foresight

Consider whether you could use or participate in such Foresight projects There are university people who are very good at it

One aspect is the expectations of the next generation of users, customers, citizens They are going to be very much different from their parents’ generation And the next wave of retired persons are going to be demanding and

difficult too – because that will be many of us in this room! The new generation of reengineered IT systems that we are building

now might have a lifecycle expectancy of maybe 15-20 years, so very big changes in such directions must be prepared for


Technology Foresight

If we think of a 15-20 year period it takes little imagination to foresee the possible size of technology changes over such a period

Wireless everywhere, grid, all kinds of new devices… Loosely-coupled, open-interface integration between systems

that need to know nothing about the internals of each other will be the standard

At the technology level nobody can claim to have the slightest idea whether the differences between mainframes and midrange systems still will exist or whether they have converged This does not necessarily mean that mainframes will die, as often

forecasted, but rather that midrange system will grow in size, processing power, stability and close symbiosis between hardware and operating systems, so the differences will wither away


The Gartner Christmas Report 2005 No more company paid laptops Telephony will be mobile or internet based The job market for IT specialists will shrink More Business Process outsourcing Software will save lives in the health sector Government regulations will be in focus

The actual report is of cause more detailed and faceted. Get the details from Gartner yourselves


A Gartner “Hype Curve”

Gartner’s phases are: Technology/Business

Trigger Peak of Inflated

Expectations Trough of Disillusionment Slope of Enlightenment Plateau of Productivity

No presentation is complete without either a Hype Curve or a Magic Quadrant


A Revolution that Never Took Place “Before man reaches the

moon, mail will be delivered within hours from New York to California, to Britain, to India or Australia by guided missiles. We stand on the threshold of rocket mail”

Arthur Summerfield, US Postmaster General, 1959


Remember “The New Economy”?

“There isn't an Internet company in the world that's going to fail because of mistakes – Internet companies make thousands of mistakes every week”

Candice Carpenter of iVillage, 1998



Globalization


The Globalization Era There has been an international division of work since long

distance trade started in the Stone or Bronze Age It changed drastically during colonial times when colonial

powers controlled who manufactured, who produced raw materials, who were allowed to buy from whom – and who were sold as slaves

After World War II and decolonization countries have become politically free, but with very different levels of development, economy and political rights

Changes in economic strength, the fall of the Iron Curtain, and the establishment of new networks of terror have changed both the political and the economic climate of the planet: The Cold War Era has been replaced by the Globalization Era


Characteristics of Globalization People around the Globe are more connected to each

other than ever before Information and money flow more quickly than ever Goods and services produced in one part of the world

are increasingly available in all parts of the world International travel is more frequent International communication is commonplace

Critics claim that Globalization means US Domination (“McDonaldization”, “Coca-Colonization”)


A Globalization Scenario

One scenario often discussed is the global consolidation of companies into three of each with an undergrowth of national subcontractors: Three car manufacturers, three computer

companies, three airplane manufacturers, three airlines, three food producers, etc.

Imagine the consequences on systems integration, network, layering of the Internet, etc.


Warfare is changing

Warfare has been the main driver of technology for the last several thousand years

“The cold war” is replaced by “The war on terror” The US Patriot Act, EU, and national Nordic anti-

terror legislation affects the IT and telecommunication businesses by demanding large scale storage of communication patterns and/or content Its will keep a lot of the database, data mining and OLAP

specialists busy It also is subject for a large debate in all democratic countries



Changes in IT


Ten Key Trends for IT Services in 2006ComputerWire Market Watch predicts:Steady growth in spendingMega-deals to declineMulti-sourcingTelecoms, pharma and retail the hot sectorsContinental Europe warms to outsourcingTelecoms/IT services crossover continuesIndia arrives in infrastructure managementProcurement outsourcing to explodeFinance & Accounting outsourcing to ramp upMergers and Acquisitions among IT service providers


Compliance

Financial scandals has put focus on “compliance”, i.e. acting according to accepted standard procedures and processes

Sarbanes-Oxley and Basel II Outsourcing, offshoring, and the

change of IT from art to industry has changed may relations from close partnerships to commercial relations

A contract is now a governance tool rather than an emergency brake

Tight standards on IT processes and project management like ITIL, PRINC 2, CMMI, and Six Sigma


Processification of IT

The compliance paradigm drives IT organizations to change their ways of working from art and handicraft to industrial processes

Better documentation is one important product

Mainframe has learned to work structured many years ago

Midrange and desktop are struggling to change their processes

This is a sign of maturity, and without any doubt necessary

It changes the skill sets necessary to do the job

Which consequences for innovation and creativity?


Does IT Matter?

Article by Nicholas Carr in Harvard Business Review, May 2003

Followed by the book “Does IT Matter? Information Technology and the Corrosion of Competitive Advantage”

Observation: IT becomes a commodity, and competitive advantage diminishes

His conclusion: Stop investing in IT


IT Doesn’t Matter – Business Processes Do

Smith and Fingar divide IT into three stages: IT infrastructure Business automation Business process

management IT does matter in the last

area because it is a business process enabler, say Smith and Fingar


Software Engineering

Procedural programming is based on mathematical models like λ calculus and the work of Alan Turing

Correctness can be proved mathematically

The US DoD spent years validating the Ada language, used for spaceflight and guided missiles


Weinberg’s Second Law

If Builders Built Buildings The Way Programmers Write Programs, Then The First Woodpecker That Came Along Would Destroy Civilization

Gerald Weinberg, 1972 Years ago I quoted to an

architect Weinberg's line. "Oh," she said, "but that's just how they do build them.“

George Jansen in RISKS Digest, 2005


A Component Architecture Debate in “RISKS” “If you have small components that you know are right, and you then

combine those components to manipulate each other according to their published interface specifications, the results should be consistently correct. The results will be predictable, the usage will be consistent every time. But in general, this is not how we are designing software.” (Paul Robinson)




“There is only widespread take up of component reuse where those components are reliable and free.” (Steve Taylor)





“Software patents make component reuse dead. Reuse a bunch of stuff and pay many fees, royalties, patent searches, lawyers and contract negotiations. So who will try reusing components with very real legal, financial, etc. risks when the risk of consequence for a bug (even resulting in deaths or huge financial losses,) is small?” (Steven Hauser)






[Open Source] “provides us with the ability to obtain components that we can fix (or hire experts to fix) if they break.” (Tom Swiss)


A Critique of OO from the Same Debate

“What OO has done to the development of software engineering is devastating

Instead of continue to develop more advanced languages we got stuck with half-assembler languages like C and followers. A compiler for a high level language (re-)uses code templates. A compiler for a more advanced language could reuse even larger chunks of code, without any need for a programmer to try to find the code in a catalog

To my disappointment, I have seen very little progress during the last two decades in the field of software development

The ever increasing speed of the processors and the cheap memory prices has more encouraged fast hacking than a systematic development based on sound engineering principles.” (Kurt Fredriksson)


The Case for SOA and for LST The current answer to the problems discussed is Enterprise

Architectures that are built on standard components, shrink-wrapped packages, legacy systems functionality, plus custom built service-enabled applications where needed Plus stronger management procedures like ITIL etc.

The case for Legacy Systems Transformation (LST) is that these systems are thoroughly tested, tuned, debugged, and functionally corrected by change management, based on years of user observation in real production If it makes sense to reuse parts of their functionality in the new

business processes But Kurt Fredriksson would probably accuse us of hiding the

symptoms rather than curing the disease


Open Standards and Open Source Open standards like SOAP

means that you can connect separate systems to each other in a documented way without paying a license fee

Everybody says they support it Open source is just another way

of pricing products and services The question about the quality

of open source has mainly ended by now

The discussions about open source and open document standards are also a battlefield in the struggle for market domination



SOA, POA, EDA, and other TLA’s


SOAP is not the same as SOA SOAP is not the same as SOA SOAP is not the same as SOA SOAP is not the same as SOA SOAP is not the same as SOA SOAP is not the same as SOA SOAP is not the same as SOA SOAP is not the same as SOA SOAP is not the same as SOA SOAP is not the same as SOA SOAP is not the same as SOA SOAP is not the same as SOA SOAP is not the same as SOA

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SOAP is not the same as SOA SOAP (aka Web Services) is a

protocol used for system-to-system communication

Any system can be equipped with a SOAP interface – like an APPC interface, a Sockets interface, an RPC interface etc.

SOAP can be used in a SOA, but so can other interfaces


SOAP is not the same as SOA SOAP (aka Web Services) is a

protocol used for system-to-system communication

Any system can be equipped with a SOAP interface – like an APPC interface, a Sockets interface, an RPC interface etc.

SOAP can be used in a SOA, but so can other interfaces

SOA is an enterprise architecture model, where functionality in separate systems is exposed using loose coupling and open standard interfaces, including – but not exclusively – SOAP

Many current SOA projects are technical infrastructure projects rather business projects

Which is why some people call a full SOA with BPMS a Process Oriented Architecture (POA)


Robert Morris in zJournal, 2006

There’s no shortage of vendors willing to further confuse the issue by offering simplistic solutions to delivering mainframe Web Services, and claiming this is synonymous with delivering SOA

This approach should come with a warning label: “Web Service enclosed. All assembly required.”

It’s like delivering a load of lumber to a prospective home-builder

It requires: An in-depth understanding of

how the components work together to comprise a recognizable business task

Automating the interaction of the underlying functionality and data sources necessary for the task

The whole thing be packaged in an easily recognizable and accessible form for effective use and reuse

Talking “Web Services” instead of “business services” really misses the point


POA according to Howard Smith From “Workflow is just a π Process”, 2003: A BPMS does not “integrate” applications and Web services as

many workflow solutions and EAI do. That approach only creates aligned data and some workflow control over messaging

By contrast, a BPMS assists in the direct reuse of existing investments in IT processes by consolidating them within a process-oriented architecture (POA)

This means we can persist them as data records in a BPMS process base, a database of process records. Like stored information within the thread of email, the process base contains the past, present and alternative futures (via simulation) of the stored process


POA according to Howard Smith Within a POA, the conceptual centre is the business

process itself, the focus of management attention In the same way that the RDBMS, based on the

relational model of data management, replaced disparate hierarchical and network-oriented databases, we believe BPMS will replace multiple approaches to workflow

The BPMS heralds a change in the IT stack itself, from applications built on a data foundation, toward process management tools built on a process foundation


POA according to Howard Smith

The BPMS platform provides a process-oriented architecture (POA) that can be deployed over today’s Web services platforms that are, by contrast, service-oriented architectures (SOA)

Web services are just fine at exposing the process participants the BPMS can exploit

Web services live in the era before π calculus-based technologies

They represent the final standardisation of 20th century technology, and for many businesses that’s long overdue

By contrast, the BPMS is a 21st century innovation and ripe for market adoption


Event Driven Architecture

Event-Driven Architectures (EDA) can be seen as an extension to SOA and BPMS

EDA refers to any applications that react intelligently to changes in conditions, whether that change is the impending failure of a hard drive or a sudden change in stock price.

Gartner sees EDA as “THE NEXT BIG THING”™


IBM and Event Driven Architecture

“Planned enhancements to the CICS family of products”, IBM Statement of Direction May 2006, include:

“IBM intends to support Event Driven Architecture (EDA) to initiate the event-triggered delivery of a message for appropriate action in managing and separately maintaining infrastructure and business processes

It is planned for CICS to provide non-invasive instrumentation of business logic that can be used by both business analysts and developers. As a first step in its longer-term EDA strategy, IBM intends that the complementary product, CICS Business Event Publisher for MQSeries, will be extended to conform with the Common Event Infrastructure for working with a wide range of business, system, and network events”

Capability Description

Decoupled interactions

Event publishers are not aware of the existence of event subscribers

Many-to-many communications

Publish/Subscribe messaging where one specific event can impact many subscribers

Event-based trigger

Flow of control that is determined by the recipient, based on an event posted

Asynchronous

Supports asynchronous operations through event messaging



Outsourcing and Offshoring


Growth of Indian Offshoring Has gone through three stages

Development of world-class applications development skills, when firms like Tata became partners with Western firms for low cost development

Indian firms offering low-end back-office services (call centers, transcribing medical records, processing insurance claims etc.)

More complex services are now being provided in IT and Business Process Outsourcing

According to The Economist, 2006


New Countries are Joining In

Some of India's offshoring giants are offshoring themselves, fueling the next round, and U.S. firms are joining in Tata has opened offices in Budapest, in Hangzhou, China, and in

Chile. It plans to add 1,500 to the 485 people at its Brazil arm Infosys Technologies set up shop in Shanghai, Mauritius, Prague

and Brno Wipro has new offices in Shanghai and Beijing and soon in

Bucharest


New Countries are Joining In

Some of India's offshoring giants are offshoring themselves, fueling the next round, and U.S. firms are joining in Tata has opened offices in Budapest, in Hangzhou, China, and in

Chile. It plans to add 1,500 to the 485 people at its Brazil arm Infosys Technologies set up shop in Shanghai, Mauritius, Prague

and Brno Wipro has new offices in Shanghai and Beijing and soon in

Bucharest U.S. firms are expanding beyond India, too

Call-center giant Convergys recently opened offices in Dubai and Budapest

IBM Global Services is adding staff in China, Hungary, the Czech Republic and Brazil

Accenture is adding staff in the Philippines, China, Slovakia and the Czech Republic


China’s Five Surprises

Edward Tse recently wrote in “Resilience Report” that by 2030, if not sooner, China could be the world’s largest economy. He thinks China will succeed, where Japan didn’t, because of five “surprises”:




“Why not me?” The intensity of Chinese entrepreneurialism is propelling many

companies, even now, beyond a role as producers of low-cost commodities




“Why not me?” The intensity of Chinese entrepreneurialism is propelling many

companies, even now, beyond a role as producers of low-cost commodities

Fearless experimenters China’s emphasis on rapid-fire research and development makes it a

seedbed for original products and services in the future



China’s “brain gain” The ability to attract and retain executives from around the world

has provided a higher level of competence for China’s enterprises




has provided a higher level of competence for China’s enterprises Out from Guanxi

Outsiders still view China as a largely patronage-based economy, in which connections and ethnic background determine success, but increasingly (at least in some sectors), high-quality management and transparent governance structures count more




has provided a higher level of competence for China’s enterprises Out from Guanxi

Outsiders still view China as a largely patronage-based economy, in which connections and ethnic background determine success, but increasingly (at least in some sectors), high-quality management and transparent governance structures count more

China’s overseas ambition The country is taking on a role as a catalyst of sustained economic

growth in the emerging markets of the developing world


Backsourcing Backsourcing is taking back in-house services that

were previously outsourced JP Morgan Chase did it with IBM in the wake of the

Bank One merger Banco Santander has said that it is backsourcing some

of Abbey’s IT operations Sainsbury’s announced that it is bringing back in-

house its multi-billion outsourcing with Accenture Also examples from Denmark

Could this happen for offshoring as well?


The Danish Globalization Council

Established by the Danish government April 2005

It has been advising the government on an ambitious, comprehensive strategy to prepare Denmark better for globalization

It comprised representatives from Trade Unions, employer organisations, education, and research circles


“Progress, Renewal, and Security” A report from the government after

listening to the Globalization Council, published April 2006, concluded among other points:

Better education More competition among

universities Stronger cooperation between

companies and universities Stronger competition Import of more highly educated

workers Lower taxes


“Progress, Renewal, and Security” A report from the government after

listening to the Globalization Council, published April 2006, concluded among other points:

Better education More competition among

universities Stronger cooperation between

companies and universities Stronger competition Import of more highly educated

workers Lower taxes

The report has been criticised for not listening enough to the council, for just repeating existing government policy, and for having too short a perspective

It wisely focuses on furthering the Scandinavian “flexicurity” model

When I used the same argument as the report about education in a recent discussion, I was challenged: “What can your education do to compete with 100.000’es of Ph.D.’s in India and China?”

Perhaps the Innovation paradigm would be a better answer?

It is in fact a keyword in the report


The Offshoring Equation for Companies Offshore 20 jobs and keep 30 at home – or lose all 50

jobs to your competitor? Offshoring is a fact of life Companies have to analyze what to keep locally and

what to offshore Companies have to adapt new processes and standards

to control and manage this new level of complexity What are the social consequences for society and for

employees?


Intergovernmental Interoperability The Danish Ministry of Science, Technology, and Education is

promoting Intergovernmental Interoperability based on Service Oriented Architectures and a very long list of recommended standards

Many very large government systems are being reengineered into SOA architectures

Some systems, however, are too simple in their structure for a SOA to make sense Alternatively, they are exposing relevant parts of their functionality as

Web Services for others to use “Nordic Relocation” is an Inter-Nordic example of such projects



Stratification of IT


Symptoms of Stratification Stratification, i.e.: separation in layers Peter F. Gammelby observed in a Danish newspaper, 2006:

Globalization and the lack of Danish IT experts are creating a deep salary gap in the Danish IT business

A growing number of companies are having their IT work done in low pay countries, which primarily affects the least educated IT staff here, both on job opportunities and salary

Highly educated IT specialists in contrary are in shortage here, and they are currently earning prize salaries. The lack of them are however now so strong – and their salaries so high – that companies have started to find the highly specialized workforce in low pay countries


A new Stratification is Emerging

Companies often look at IT as a commodity or utility They want to have unlimited IT resources and pay as they go

This pushes IT down the Value Chain IT departments look at IT as a strategic resource

They want to move IT up the Value Chain and into the board room The net product is a new division of work and a stratification of IT functions,

departments, and staff inside companies, between companies, and internationally

This question poses itself: Will you be an industrial worker on the code assembly line or in operations? Or will you be part of business- and customer-facing engineering, architecture,

and consulting? This may affect your long-term job satisfaction and job security



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