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computerweekly.com 3-9 March 2015 1
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SME SUPPLIERS CRY FOUL OVER CAPITA’S GOVERNMENT DEAL
DIGITAL CHEQUES MAY BE FATAL BLOW TO BANK BRANCHES
SERVICE PROVIDER PARTNERSHIPS KEY TO FOOD FIRM’S IT
EDITOR’S COMMENT
OPINION
BUYER’S GUIDE TO CLOUD-
OPTIMISED IT
MICROSERVICES: HOW TO
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Birds Eye acts fast on lean IT
EXTERNAL PARTNERS KEEP TECH OPERATION LEAN AND AGILE AT BIRDS EYE MANUFACTURER IGLO
3-9 March 2015 | ComputerWeekly.com
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HOME
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SME SUPPLIERS CRY FOUL OVER CAPITA’S GOVERNMENT DEAL
DIGITAL CHEQUES MAY BE FATAL BLOW TO BANK BRANCHES
SERVICE PROVIDER PARTNERSHIPS KEY TO FOOD FIRM’S IT
EDITOR’S COMMENT
OPINION
BUYER’S GUIDE TO CLOUD-
OPTIMISED IT
MICROSERVICES: HOW TO
DEPLOY THEM
DOWNTIME
THE WEEK IN IT
Banking ITDeutsche Bank signs 10-year deal to re-engineer wholesale banking ITDeutsche Bank has signed a 10-year deal with HP to re-engineer the IT that underpins its wholesale banking arm in preparation for the next phase of its digital transformation. The multibillion-euro deal will see the German banking giant use cloud platform HP Helion, modernising the IT that supports the bank’s applications.
Government ITGovernment direct spending on SME contracts decreased in 2013/14Government spending on contracts with UK small businesses fell in the latest financial year, despite high-profile policies designed to increase the amount spent directly with smaller firms. The latest figures for 2013/14 show central government spent £4,489m directly with small and medium-sized enterprises (SMEs), representing 10.3% of all procurement spend.
IT economyUK tech sector avoids economic slowdown in fourth quarter of 2014The UK tech sector saw growth in the fourth quarter of 2014, avoiding the eco-nomic slowdown experienced by the rest of the UK economy, a report by KPMG and Markit has revealed. The tech sector’s profitability was the second-highest since the fourth quarter of 2007.
Mobile security Berners-Lee foundation calls for urgent steps to secure mobile communicationsThe World Wide Web Foundation set up by internet inventor Tim Berners-Lee has called for urgent steps to secure newly revealed vulnerabilities in mobile communications. The appeal from the organisation comes in response to reports UK and US intelligence agencies hacked into Sim card maker Gemalto to steal mobile encryption keys.
IT skillsDigital tech skills added to Shortage Occupation Lists for UK and ScotlandUK employers could find it easier to recruit international graduates with digital skills, after graduate occupations in the digital technology sector were added to the Shortage Occupation Lists for the UK.A report by the Migration Advisory Committee has recommended the job titles product manager, data scientist, senior developer and cyber security specialist be added to the list.
Data securityLenovo faces lawsuit for pre-installing adware A class action lawsuit has been filed against Lenovo after it emerged the company pre-installed Superfish adware that made customers vulnerable to man-in-the-middle attacks. Lenovo has admitted pre-installing the software was a mistake and issued a tool to remove it.
access the latest it news via rss feed
MAGGIE PHILBIN DISPELS MYTHS AROUND TECH CAREERS
TeenTech founder Maggie Philbin has spoken to the finalists of Network Rail’s Could IT Be You? competition to inspire them to pursue a tech-related career.
Philbin said the wide variety of roles and opportunies in the IT sector are poorly understood by students, parents and teachers.
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SME SUPPLIERS CRY FOUL OVER CAPITA’S GOVERNMENT DEAL
DIGITAL CHEQUES MAY BE FATAL BLOW TO BANK BRANCHES
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EDITOR’S COMMENT
OPINION
BUYER’S GUIDE TO CLOUD-
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THE WEEK IN IT
access the latest it news via rss feed
Mobile security 3G and 4G phones not affected by NSA and GCHQ hack, says GemaltoThe world’s largest maker of Sim cards, Gemalto, said it has “reasonable grounds” to believe it was “probably” hacked by the US National Security Agency (NSA) and the UK’s GCHQ in 2010 and 2011. But following an investigation, the firm said the intelligence services would only have been able to spy on 2G mobile networks. “3G and 4G networks are not vulnerable to this type of attack,” it said.
Cyber crimeNCA and other European crime agencies disable Ramnit bank-robbing botnetThe National Crime Agency (NCA) and other European crime agencies have shut down servers used by a botnet targeting personal banking information. One of the servers was found to be in Gosport in Hampshire. Ramnit, as the botnet is known, has largely been used to attempt to take money from bank accounts.
Banking ITHSBC to invest heavily in technology to protect against ‘bad actors’HSBC plans to invest heavily in data analytics and cyber security capabilities this year to avoid regulatory penalties and damage to its public image. In its latest financial results, the bank said it is “prioritising” investment in systems that can prevent repetition of regulatory failings in the past.
Public sector IT£700m spent on Universal Credit yet to deliver value for money, say MPsThe Department for Work and Pensions (DWP) has spent £700m on the contro-versial Universal Credit programme so far, but has yet to convince MPs it is deliver-ing value for money. A report into the welfare reform scheme also revealed that while £344m has been spent with sup-pliers to develop the existing IT systems, DWP only expects to use £34m of that work once the final system goes live.
IT servicesAmey awards $87m IT services contractEngineering company Amey has outsourced application development and management to CSC as part of a seven-year contract worth $87m. The deal covers all UK business units of the engineering consultancy. Amey CIO Darryl Salmons said the IT services contract will give the company the flexibility it requires to grow.
IT recruitmentMet Police begins search for replacement CIOThe Metropolitan Police is looking for a new CIO to implement its Total Technology IT strategy. Former CIO and director of digital policing Richard Thwaite left the force in February, having overseen the creation of the new strategy and led a project to introduce iPads for officers on the beat. n
Source: Federation of Small Businesses
SECURITY FEARS STOP SMALL FIRMS USING CLOUD COMPUTING
Data theft or loss
Reliable access to online services
61%
55%
41%
53%Concerns over who would
have access to the data
Liability issues
Cloud computing worries for small and medium-sized enterprises
33%Over-dependence on
cloud services
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ANALYSIS
Small IT services suppliers complain government procurement agency tenders force them out of the public sector contract labour market, writes Bryan Glick
SME suppliers cry foul in row over Capita’s £2.45bn government deal
SME IT services suppliers have lost tens of millions of pounds in business after refusing to sign up to a controversial
£2.45bn Cabinet Office agreement with services giant Capita for sourcing temporary staff across the public sector.
Over 20 companies have protested to the Crown Commercial Service (CCS) – the UK government procurement agency run by the Cabinet Office – for more than a year about contractual conditions they believe prejudice their businesses in favour of Capita.
Some suppliers accuse CCS of a deliberate attempt to undermine their relationship with government and cut them out of the supply chain, in contravention of official Whitehall policy to increase the amount of public spending put through small businesses.
Some have asked to remain anonymous over fears about losing future deals from CCS and Capita, but several have shared details of their concerns with Computer Weekly.
One supplier claimed to have lost over £20m in revenue, and to have been forced to lay off 10 staff. Another firm estimated it had lost out on £12m of sales opportunities. Other SMEs are believed to have missed out on tens of millions of pounds of revenue.
One of the companies said a senior execu-tive at CCS had indirectly warned it not to “rock the boat” at the risk of losing future business with government.
This is not the first time CCS and Capita have been accused of such behaviour. The Independent newspaper reported two weeks ago that officials were investigating a smaller, £250m contract for civil service training – also won by Capita – over allegations that some suppliers had been forced out of business. Cabinet Office minister France Maude said in the House of Commons that such a situation, were it true, was “not acceptable”.
IT services suppliers claim the Cabinet Office’s deal with Capita prejudices their contract labour interests
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National Audit Office
reviews Capita government
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SMEs seek legal advice over Capita
contracts with government
Contingent Labour OneThe latest controversy centres on a pur-chasing framework called Contingent Labour One (CL1), which went live in 2013. The aim was to centralise the sourcing of all temporary staff across Whitehall – from clerical and administrative roles through to interim CIOs – under a single arrangement. Three suppliers were appointed, with Capita winning Lot One, which covers the higher value, specialist contractors and interim managers, including temporary IT workers. The overall CL1 framework is worth an esti-mated £3bn over four years, with Capita’s Lot One alone worth £2.45bn.
Right from the start, a number of SMEs that provided temporary staff to government at the time through the non-professional staff (NPS) framework – which was wound up last year - protested about the arrangement.
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SME SUPPLIERS CRY FOUL OVER CAPITA’S GOVERNMENT DEAL
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n Capita is allowed to place up to 20% of all CL1 contracts by value with other Capita divisions – but without restriction on the type of deals it wins. Rival suppliers claim this allows Capita to cherry pick the most profitable contracts, leaving only lower-value opportunities for others. Capita said it had won 11.4% of all contracts under CL1 – although that gives it a market share more than 40 times greater than the 0.3% aver-age share across all 302 suppliers to CL1, according to estimates from affected firms.
Several SME suppliers met with the Cabinet Office in February 2014 to outline their concerns about CL1. But, despite numerous further meetings and correspond-ence – including with CCS chief executive Sally Collier, and the Crown representative for SMEs, Stephen Allott – they have still not received a response to allay their concerns.
Capita repudiates wrongdoingA spokeswoman for Capita said CL1 was run in the manner required by government.
“Capita has an excellent track record of working with and engaging SMEs. We refute [sic] any suggestions of wrongdoing regard-ing this recruitment framework,” said Capita.
“More than 60% of the work under CL1 has been awarded to SMEs. Of the 302 suppliers on the framework, 274 are SMEs. The frame-work has been designed, and is run, in the manner required by government to ensure a level playing field and best value for money. In Capita’s view the removal of restrictive covenants, for example, enables contractors to move more easily between government departments at the end of assignments.”
Capita said the final decision on all con-tracts is made by government clients without knowing the identity of the supplier. “The client-hiring manager, who does not know the identity of the supplier, makes the final selection decision for all contracts, regard-less of their value. To give all suppliers an equal and fair chance, they have access to the same information. In some cases Capita even hosts conference calls between all suppliers and the hiring manager, to provide additional context and answer questions that any supplier may have,” said Capita. n
Many lost out when Capita came in to take over a previous framework called Cipher in 2008. At that time, all companies supplying staff through Cipher were forced to transfer their employees and contractors to work for Capita with no compensation for lost busi-ness. As recently as 2011, some government departments were still transferring SME business to Capita via Cipher.
Now SMEs fear CCS and Capita will force a similar takeover of their resources through CL1, eliminating them from the government contract labour market altogether.
Market dominanceThe SMEs cite concerns over Capita’s dominance of the market and its access to sensitive commercial information about rivals, as well as clauses they believe allow Capita to poach contractors from agencies or employers. Complaints include:n A ban on restrictive covenants (RCs). These are standard employment clauses that prevent staff from going directly to work for competitors for a period of time, to protect existing customer relationships. But suppliers wishing to provide contrac-tors under CL1 have to sign a contract with Capita that prevents RCs being imposed, meaning Capita can bypass the company and deal directly with individual contractors. This is a particular problem for SMEs, who say this gives Capita the right to cut them out of the market with no compensation.n While the CCS contract with Capita states that Capita does not have exclusive rights, and that government is free to sign con-tracts with other suppliers, Capita imposes anti-compete clauses on sub-contractors that could prevent SMEs from bidding for work that would otherwise fall under CL1. Capita also restricts its sub-contractors from having direct contact with the govern-ment customers, contravening clauses in the CL1 framework.n To sign up with Capita, suppliers have to provide sensitive commercial information about their business and staff, without any contractual protection over how Capita uses it. The SMEs claim this allows Capita to build a database of contract staff it could subsequently use to bypass them and dominate the market.
ANALYSIS
This is an edited excerpt. Click here to read the full article.
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Digital cheque processing could prove fatal blow to bank branches
B ank branches are shutting across the UK as banks renege on their promise to keep branches open, blaming
changing consumer habits and the move to digital technology.
Digital developments, such as software to allow customers to pay in cheques via their smartphones, demonstrate how technology is reducing the need for customers to visit bank branches.
A document from the British Banking Association to members, which was leaked to The Sunday Times, revealed banks will not commit to ensuring the last bank in town stays open. Reports claim more than 500 branches across the UK could close in 2015.
The leaked document said: “Decisions on branch closures are ultimately commercial decisions. After a bank has decided to close a branch, the firm will engage with key local stakeholders to understand the potential impact on the community.”
Smartphone cheque paymentsA Computer Weekly survey of IT industry professionals revealed the main reason most people go to the bank is to pay in cheques. But recent announcements from Barclays and Lloyds Bank, of apps that enable people to pay in cheques using their smartphone, could mean this might not be the case in the future.
On average, survey respondents said they visit a branch once every six months. Almost all respondents said branches would never disappear completely, while those who did not use mobile banking apps cited security fears as the reason for not doing so.
The Royal Bank of Scotland (RBS) and the Co-operative Bank provide recent examples of companies announcing branch closures. The Co-operative Bank is closing about a quarter of its remaining branches and digital
technology will replace them. It will close 57 branches as part of its cost-cutting plans, leaving it with 165 (about one per 8,500 customers), but aims to retain service levels through IT. The bank said it was responding to changes in the way customers bank.
Meanwhile, RBS will close another 99 branches. A senior executive at the bank, Moray McDonald, told a House of Commons committee that hundreds of millions of transactions, previously completed in branches, have moved online. “We are seeing a revolution in the way our customers want to bank,” he said. “We have been taken aback.”
McDonald said the bank had identified 99 branches for closure, but this figure could change. In April 2014, the bank announced the closure of 44 branches in the UK after a 30% fall in the number of transactions made in-branch. In a recent announcement about mobile banking and fingerprint authentication, RBS said its mobile banking app was its biggest branch. More than 167,000 RBS and NatWest customers use it between 7am and 8am on their commute to work every day.
Banks have reneged on their promise to physical branches open, blaming changing consumer habits and digital technology. Karl Flinders reports
Santander data storage:
Gimmick or real challenge to
IT giants?
Six challenger
banks using IT to shake up UK retail banking
THIN
KSTO
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The future of bank branchesMeanwhile, Barclays is arming its community bankers with iPads featuring an app that can carry out all the transactions that occur in a branch. An iPad and Wi-Fi or 3G connection is used to connect to the service which will enable them to carry out money transfers, make changes to personal details or open accounts. The bank will roll it out across the UK in summer 2015. Barclays also accepts photo documents to be included in mortgage applications online, while Nationwide Building Society carries out mortgage consultations via video-conferencing technology.
But branches are unlikely to disappear completely. In fact, some people see them as an advantage.
Santander chairman Ana Botín recently insisted bank branches have value, even if far fewer people visit them. “The fact is, even young people like to go to a branch at least twice a year. That means you need quite a significant retail presence,” she said.
Botín said online services are not for everything and banks should remain
focused on traditional services, such as in-branch consultation.
“At important times in your life, you want to see a person,” she said. “You are not going to get married through technology. You are not going to buy a house through
technology. I think that is where we are going to compete very effectively with these guys, if we can find a model that combines the personal side with the technology.” Santander has 14,000 branches in the UK, US, Latin America and continental Europe.
Some challenger banks also see the branch as vital. Lintel Bank, which is currently applying for a UK banking licence, plans to have branches and telephone services. “We are as much digital as the other challenger banks, but also provide a branch and telephone service to provide a quick and easy method of resolution of customer concerns,” said the bank’s creator, Nazzim Ishaque. Lintel Bank is likely to be based in London, with branches in the city, before expanding to other areas.
Sainsbury’s Bank is also looking to open branches in its stores as part of a planned layout refresh. n
ANALYSIS
FLIC
KR
› European banks to spend £46bn on IT by 2017› Fears over IT security of new banks overblown
› Barclays Bank launches mobile video banking
“The facT is, even young people like To go To a branch aT leasT Twice a year”ana boTín, sanTander
The most common reason for someone to visit a bank branch is to pay in a cheque, but apps from Lloyds Bank and Barclays, which will enable people to pay in cheques using only their smartphone, could lead to more branch closures
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INTERVIEW
Service provider partnerships key to delivering business benefits at Iglo
Sarah Leslie, CIO at Birds Eye manufacturer Iglo
Foods Group, is focused on delivering simplified
and standardised IT systems. She says that, in using a mix of internal expertise and outside partnerships, she is on course to produce lasting business benefits.
Following a two-decade stint at United Biscuits, Leslie joined Iglo as business solutions manager in 2007. She took over the day-to-day management of IT a year later, assuming the CIO role in 2011. It is a role she relishes and says much of her enjoyment stems from the distinct nature of the technology management at the firm.
Iglo Foods is best known for its regional European brands, such as Birds Eye in England and Findus in Italy. “IT at Iglo is a little bit different to other large companies,” says Leslie. “We have a very small team of internal IT workers who have worked closely with a select group of partners to build and maintain our technology platform.”
Leslie says leanness is the name of the game for the Iglo business. The organisation is open and flat. Her IT team, for example, sits among the rest of the business at the firm’s head office in Feltham, Middlesex. The proximity helps Leslie and her colleagues stay on top of the fast-changing demands in an ever-evolving business.
Unilever sold Birds Eye Iglo, as it was then called, to private equity firm Permira in 2006. The business was presented with a rare opportunity to create a fresh IT platform, unencumbered by the legacy systems that can restrict the technology decisions made by executives. Then CIO and current chief operating officer, Tania Howarth, decided to build key partnerships with external service providers.
Partnerships deliver business benefitsDuring the next two years, Howarth and her colleagues in the IT department started to create relationships with outsourcing specialists. Although the number of contractors varies with different projects, the core internal IT team comprises just 15 people. Leslie recognises the department is lean but says it is an approach that works well for the business.
“There’s no room for passengers,” she says. “We do a lot of work with our small IT team. It’s easier to be clear about where we need to concentrate. The small nature of our team means we must work together and collaboration is natural.”
Employees concentrate on building strong relationships with outsourcers. External provision covers two main areas: service delivery, where internal IT staff focus on making sure current services work well; and business solutions, where staff concentrate on applications functionality and capability. There are two main providers, one for applications and one for infrastructure.
Sarah Leslie, CIO at Birds Eye manufacturer Iglo Foods Group, tells Mark Samuels about the importance of external service provider partnerships to the firm’s IT
Heinz puts SAP Hana in the cloud to
boost global efficiency
UK manufacturers
more than double
outsourcing spend
CW500 interview
Leslie: “We’re heavily reliant on partners and we need to make sure the cultural fit is spot on”
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Supplier relationship management “We’re heavily reliant on partners and we need to make sure the cultural fit is spot on,” says Leslie. The significant position of outsourcers in Iglo’s IT means Leslie is well-placed to offer advice about outsourcing best practice to other technology leaders. She says CIOs must pay significant attention to the style of the supplier.
“You need skin in the game and you need to find a partner that provides a strong cultural fit in the way your organisation completes its business. If your procurement and legal teams like to complete a lot of due diligence, then you need a partner prepared for heavier processes. If you’re looking for agility, then you might need smaller partners that can move quickly,” says Leslie.
“The scale of the relationship, and the balance you achieve, becomes absolutely central. Success depends on establishing the right relationships at the beginning of the contract. You must make sure you determine what your business really wants to achieve through the partnership. As CIO, you need to create strong relationships with the people who will deliver your IT. And you must ensure your IT team has a model to help make the most of your outsourcing partners.”
Managed risk approach to developing ITOutsourcing is not the only crucial component of Leslie’s IT strategy. She says the business recognises that speed of IT implementation – albeit with some workarounds or system issues – often delivers quicker and bigger business benefits than spending more time and money on trying to perfect a system before it goes live.
“It’s usually better if the rest of the business has something to work with, use and understand,” says Leslie. “It’s better to make
a decision with the amount of information you’ve been given, rather than waiting
until it’s too late and your business has lost a competitive advantage. The quicker we can get things out, the quicker the business can give its feedback, and then reap the benefits of the work we’ve undertaken.”
Leslie says the creation of an IT platform for the new Iglo business in 2007 and 2008 provided an example of a substantial project undertaken quickly, with support from the rest of the business. “Starting from scratch represents a powerful burning platform,” she says. “You really have to think very carefully about what IT you’re going to spend money on. The big lesson we learnt was all about balancing the risk of going live with the benefits of quicker delivery.”
Leslie and her colleagues have applied these lessons as the Iglo business develops. The firm purchased the remaining Italian frozen food company, trading under the brand name Findus, from Unilever in 2010. Leslie says Iglo integrated the new business quickly because it had already developed a standardised and simplified IT platform. The technology team focused on balancing risk with the pace of delivery, as it pushed a transformation programme at desktop, datacentre and application levels.
“We’re a lean IT operation but there’s still plenty of work to do,” says Leslie. “Meeting business needs through simplicity is abso-lutely crucial to the organisation. What we’ve found is there is often pressure to undertake as much testing as possible. But it’s prob-ably better to go live as quickly as possible and decide what needs to be changed as the business starts using your services.” n
› CIO interview: Leandro Balbinot, HJ Heinz› CIO interview: Andrew Marks Tullow Oil
› CIO interview: Mike Gibbons, Aggregate Industries
INTERVIEW
“sTarTing from scraTch represenTs a powerful burning plaTform. you really have To Think very carefully abouT whaT iT you’re going To spend money on”
This is an edited excerpt. Read the full interview online.
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EDITOR’S COMMENT
Statistics belie UK government’s SME spending claims
The government last week touted its success at delivering on a policy objective to put 25% of all purchased spend through SMEs – in 2013/14,
that amounted to £11.4bn, slightly ahead of target at 26.1% of all spending. But, at the same time, many SMEs are up in arms about the way they are being treated by Whitehall. So which is true?
That 26.1% consists of 10.3% direct spending – con-tracts between government and SMEs – plus 15.8% indirect spending, which means large firms passing some of their government business to SMEs as sub-contractors. That means about 90% of all contracts by value still go to big companies.
But government relies on those big firms to report back how much they spend with SMEs – the number is not audited. The Cabinet Office admits that “the approach to indirect spend should be regarded as indicative”.
Meanwhile, direct spend has flatlined – 10%, 10.5% and 10.3% respectively in each of the last three financial years. In the year before – 2010/11 – only 6.8% of spend went direct to SMEs. The jump that year meant an extra £1.2bn. The Cabinet Office attributes that to new coali-tion policies affecting contracts up to £100,000.
So, if we assume that £1.2bn came about by SMEs winning more contracts worth, on average, £100,000, that would imply 12,000 new contracts won by SMEs. That’s 1,000 per month, or about 50 every working day. Somebody in Whitehall would be getting through a lot of ink signing all that paperwork.
But the government has not been able to say how many SMEs have been awarded direct contracts – Com-puter Weekly has asked, and has not yet had an answer – but it seems unlikely to be 12,000. So where are all the SMEs that won that extra £1.2bn? There is no evi-dence to suggest the government is lying about its SME spending – but even a casual analysis raises questions over the extent to which government largesse has really been spread around the UK’s SME community.
The progress made on growing SME spending by the coa-lition government is positive, let’s be clear about that, but it may not quite be as impressive as it wants us to believe. n
Bryan GlickEditor in chief
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And there are many more big data applica-tions. For the healthcare industry, the ability to collect health data in real time and apply advanced analytics can inform decisions that lead to improved care management and address risk factors early.
In the US, some hospitals have cut emer-gency waiting times by more than two-thirds using big data analytics. They put a tag on patients admitted to emergency wards, which collects and connects their data to a dashboard. The tag monitors a patient’s location, treatment cycle and journey through the hospital, enabling hospitals to improve healthcare and discharge times.
Improving customer serviceThames Water combines data from embed-ded sensors on its pipes and treatment facilities with data from a wide range of business systems to create insights. The utility company can track and, in many cases, predict the cost risk and performance of its assets, enabling speedier response times and saving money while improving customer service.
An energy company can optimise its wind turbines by analysing thousands of data points as they collect wind speeds every second. It can then make adjustments to optimise its turbines – for instance, adjusting the pitch of the blades to maximise electric-ity generation. In practice, such an optimisa-tion process can lead to a 5% improvement in power output and boost revenue without significant upfront investment. n
OPINION
The industrial internet of things (IIoT) promises to improve how organisations work, but a big-data approach is needed to deliver value, writes Nick Millman
How to unlock the value of the IIoT
The industrial internet of things (IIoT) is an exciting outcome of the digital revolution changing the way we live
and work, but extracting maximum value requires a big data approach.
Accenture defines the IIoT as “a universe of intelligent industrial products, processes and services that communicate with each other and with people over a global network”. This connected web is spreading across a wide range of industries, from oil and gas, utilities and transportation to medicine.
Analytics will create great value from the vast datasets generated by IIoT. Some of the more conservative forecasts estimate its worth at $500bn by 2020.
Research from Accenture found 73% of companies are already investing more than 20% of their technology budgets in big data analytics and almost as many expect to increase spending in that area in the next year. Exploiting the data from the IIoT is a key part of those budgets.
The number of internet-connected devices is likely to multiply to tens of billions. One reason for this is that the combination of IIoT and big data analytics promises to drive operational efficiencies, more innovation and, ultimately, new sources of revenue.
Savings and revenue opportunitiesThrough the IIoT, operations and informa-tion technology will blend together and become more intelligent through the use of sensors, analytics and machine applications – a development that will share and create even more data.
For example, predictive maintenance can generate savings of up to 12% on scheduled repairs, leading to a 30% reduction in main-tenance costs and a 70% cut in downtime from equipment breakdowns. For a manufac-turing plant or a transport company, achiev-ing these results can add up to significant operational improvements.
Manufacturing
embraces the industrial
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What the industrial
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manufacturers
This is an edited excerpt. Click here to read the full article.
Nick Millman is Europe, Middle East, Africa and Latin America lead, analytics technology, at Accenture.
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Hybrid cloud storage has evolved in recent years to become a deployment method-ology that blends on-premises storage infrastructure with public and hosted cloud services. The road to hybrid cloud will not be short or easy for many organisations, and many will have to make detours along the way to fully exploit the rapid innova-
tion of hyperscale cloud storage environments. The workload and data mobility of hybrid cloud storage strategies will allow infrastructure and operations (I&O) professionals to hedge their cloud bets and switch providers when terms or capabilities no longer meet expecta-tions, or when cloud storage providers offer a new “can’t miss” service.
Enterprises have treated cloud storage resources as complementary storage silos to sup-port next-generation analytics and systems of engagement cloud applications, and offload menial unstructured storage burdens. But cloud storage has much more to offer. Next-generation hybrid cloud storage technologies are already available and ready to bridge the gap between your on-premises applications and resources and cloud storage services by simplifying workload mobility and cloud federation between service providers.
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Hybrid cloud storage: What
it is and how to deploy it
How to achieve optimum
performance in a hybrid cloud
Build in resilience to simplify workloads with hybrid cloudHybrid cloud offers benefits of hosted applications and offloading manual tasks but beware latency and outages in mission-critical functions, says Henry Baltazar
BUYER’S GUIDECloud-optimised IT part 2 of 3
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Drawbacks to mass cloud storage migrationThe rapidly falling price of cloud storage services is pushing organisations to migrate away from expensive conventional storage systems, toward cloud storage services. While cloud storage should absolutely be a part of your future storage infrastructure, there are a few limitations that should be kept in mind.
The untimely collapse of Nirvanix forced its clients to hastily move away from its cloud storage services, shocked early adopters and highlighted the need for cloud federation and data migration services. Long-distance data migration is still a struggle for enterprises, particularly those with large workloads on the scale of hundreds of terabytes to petabytes. The inconsistent network connectivity commonly found in remote sites exacerbates this. Data transfer across internet protocol (IP) networks can take a significant amount of time when data payloads go beyond 100 terabytes. The cost of outbound bandwidth and time associated with migrations make cloud migrations difficult and effectively lock in clients.
Cloud security is still the top impediment to full-scale cloud service adoption, although the steady stream of improvements cloud providers are making go some way in addressing this objection. Enterprise storage teams may be hesitant in handing over control of their data to cloud providers, using security and compliance concerns to slow down cloud deployments.
Strategies to mitigate data latencyWhile the physics limitations of rapid data movement cannot change, progressive enter-prises and service providers have come up with clever strategies to put computing and storage resources closer together. A handful of colocation and datacentre providers – such as Equinix, CoreSite, and TelecityGroup – have facilities either physically close to a cloud service provider or house an instance in their datacentre. This proximity allows customers to bypass the internet and connect directly to their cloud service providers, (often for a flat monthly rate, via fibre-cross-connections at port speeds of 1Gb/s to 10Gb/s), which can provide sub-millisecond latency.
Amazon’s Direct Connect emerged in 2011 as a means of accelerating data movement, and its partner Equinix claims that Direct Connect can transfer files to Amazon 138% faster than public internet connections.
Clouds, and the workloads they house, are getting larger and more business-critical on a daily basis. Beyond raw scale, you must leverage new strategies and technologies and super charge your hybrid cloud storage strategy to keep pace with innovation. n
THREE TIPS TO STAY ON TOP OF HYBRID STORAGE
n Facilitate cloud mobility. The cloud computing market is evolving rapidly, with innovative services and price wars ramping up competition. Any supporting hybrid cloud storage strategy should use resources such as AWS Direct Connect, Azure ExpressRoute, NetApp Private Storage for Cloud, and Zadara Storage to make data available to multiple cloud services.
n Prioritise resilience. Cloud services outages do happen, and you should not expect them to end any time soon. As mission-critical and business-critical workloads make their way into the cloud, your teams should use multiple availability zones and colocation sites to ensure that workloads can continue to function in the event of a failure.
n Be mindful of bandwidth costs. Premium network charges for DirectConnect and ExpressRoute will save money in the long run if large datasets must be moved to or between clouds. Migrations should be cost-justified and planned accordingly, because these operations could take days or weeks to complete.
This is an extract from the Forrester report, Your BT Agenda Demands A Hybrid Cloud Storage Strategy (January, 2015), written by Henry Baltazar, senior analyst, infrastructure and operations, at Forrester.
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In March 2014, Martin Fowler and James Lewis from ThoughtWorks published an article on microservices. Since then, the concept has gained prominence among web-scale startups and enterprises.
A microservice architecture promotes developing and deploying applications com-posed of independent, autonomous, modular, self-contained units. This is fundamentally different from the way traditional, monolithic applications are designed, developed, deployed and managed.
Distributed computing has been constantly evolving in the past two decades. During the mid-1990s, the industry evaluated component technology based on Corba, DCOM and J2EE. A component was regarded as a re-usable unit of code with immutable interfaces that could be shared among disparate applications.
The component architecture represented a shift away from how applications were previously developed using dynamic-link libraries, among others.
However, the communication protocol used by each component technology was proprietary – Remote Method Invocation (RMI) for Java, Internet InterORB Protocol (IIOB) for Corba and Remote Procedure Call (RPC) for DCOM. This made interoperability and integration of applications built on different platforms using different languages complex.
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Discover the role of
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Using the cloud to
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How to deploy microservices to derive maximum benefitMicroservices are offering businesses a more efficient way of implementing systems and services. Janakiram MSV reports on how they can be best utilised
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With the acceptance of Extensible Markup Language (XML) and Hypertext Transfer Protocol (HTTP) as standard protocols for cross-platform communication, service-oriented architecture (SOA) attempted to define a set of standards for interoperability.
Suppliers such as IBM, Tibco, Microsoft and Oracle started to ship enterprise application integration products based on SOA principles.
While these gained traction among the enterprises, young Web 2.0 companies started to adopt representational state transfer (Rest) as their preferred protocol for distributed computing. With JavaScript gaining ground, JavaScript Object Notation (JSON) and Rest quickly became the de facto standards for the web.
Key attributes of microservicesMicroservices are fine-grained units of execution. They are designed to do one thing very well. Each micros-ervice has exactly one well-known entry point. While this may sound like an attribute of a component, the difference is in the way they are packaged.
Microservices are not just code modules or libraries – they contain everything, including the operating system, platform, framework, runtime and dependencies, packaged as one unit of execution. Each microservice is an independent, autonomous process with no dependency on other microservices. It doesn’t even know or acknowledge the existence of other microservices.
Microservices communicate with each other through language and platform-agnostic application programming interfaces (APIs). These APIs are typically exposed as Rest endpoints or can be invoked via lightweight messaging protocols such as RabbitMQ. They are loosely coupled with each other, avoiding synchronous and blocking calls whenever possible.
Factors that influence and accelerate the move to microservicesContemporary applications rely on continuous integration and continuous deployment pipelines for rapid iteration. To take advantage of this phenomenon, the application is split to form smaller, independent units based on the functionality.
Each unit is assigned to a team that owns the unit and is responsible for improving it. By adopting microservices, teams can rapidly ship newer versions of microservices without disrupting the other parts of the application.
microservices are fine-grained uniTs of execuTion, designed To do one Thing very well
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The evolution of the internet of things and machine-to-machine communication demands new ways of structuring the application modules. Each module should be responsible for one task participating in the larger workflow.
Container technologies such as Docker, Rocket and LXD offer portability of code across multiple environments. Developers are able to move code written on their development machines seamlessly across virtual machines, private cloud and public cloud. Each running container provides everything from an operating system to the code responsible for executing a task.
Infrastructure as code is a powerful concept, enabling developers to programmatically deal with underlying infrastructure. They will be able to dynamically provision, configure and orchestrate a few hundred virtual servers. This capability, when combined with containers, offers powerful tools such as Kubernetes to dynamically deploy clusters that run microservices.
Developers are choosing best-of-breed languages, frameworks and tools to write parts of applications. One large application might be composed of microservices written in Node.js, Ruby on Rails, Python, R and Java. Each microservice is written in a language that is best suited for the task.
This is also the case with the persistence layer. Web-scale applications are increasingly relying on object storage, semi-structured storage, structured storage and in-memory cache for persistence. Microservices make it easy to adopt a polyglot strategy for code and databases.
Benefits of microservicesWith microservices, developers and operators can develop and deploy self-healing applica-tions. Since each microservice is autonomous and independent, it is easy to monitor and replace a faulty service without affecting any other. Unlike monolithic applications, micros-ervice-based applications can be selectively scaled out.
Instead of launching multiple instances of the application server, it is possible to scale-out a specific microservice on demand. When the load shifts to other parts of the application, an earlier microservice will be scaled-in while scaling-out a different service. This delivers better value from the underlying infrastructure, as the need to provision new virtual machines shifts to provisioning new microservice instances on existing virtual machines.
Developers and administrators will be able to opt for best-of-breed technologies that work best with a specific microservice. They will be able to mix and match a variety of operating systems, languages, frameworks, runtimes, databases and monitoring tools.
Finally, by moving to microservices, organisations can invest in re-usable building blocks that are composable.
Each microservice acts like a Lego block that can be plugged into an application stack. By investing in a set of core microservices, organisations can assemble them to build applications catering to a variety of use cases.
Docker is the easiest way to get started with microservices. The tools and ecosystem around Docker make it a compelling platform for both web-scale startups and enterprises.
Enterprises can sign up for hosted container services such as Google Container Engine or Amazon EC2 Container Service to get a feel of deploying and managing containerised applications. Based on that learning, enterprises can consider deploying container infrastructure on-premise. n
wiTh microservices, developers and operaTors can develop and deploy self-healing applicaTions
› Reasons you need microservices architecture› How microservices bring agility to SOA› Microservices is more than a buzzword
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success of online shopping in the UK which means demand for parcel post is going through the roof.
Although, as the stamp design below left demonstrates, perhaps the
Royal Mail is having the last laugh after all, with its choice of the remarkably bland image of paper tape code – despite the abundant images of the rebuilt Colossus
now housed at the National Museum of Computing.
So, to that end, exploiting Computer Weekly’s encumbent Microsoft Paint talents, below right is Downtime’s attempt to show how it might have been done better. Place your orders through the usual channels. n
Colossus stamps its name on history as Royal Mail undergoes irony bypassBritain’s contribution to computer history has received its ultimate accolade - Colossus, the world’s first elec-tronic computer, designed at Bletchley Park to help break secret German codes in World War 2, will feature on a set of Royal Mail stamps.
Royal Mail has presumably chosen to ignore the irony that Colossus set in motion the innovation that eventually created email, a technology now threatening the very existence of the postal service.
Or perhaps the timing of the launch is instead a tribute to the key to Royal Mail’s recent resurgence - the overwhelming
Read more on the
Downtime blog The Royal Mail’s design celebrating Colossus... ...and Downtime’s own concept for the stamp