Computer Weekly Editor's Blog

June 19, 2013  11:29 AM

Bringing IT leaders and tech startups together

Bryan Glick Bryan Glick Profile: Bryan Glick
CIO, innovation, Startups

There’s a lot of buzz around the technology startup scene and the Tech City area in east London. There are great strides being made in Bristol, Manchester, Cardiff and Newcastle, where technology startup hubs are developing new organisations.

But mostly, we hear about consumer-focused startups building apps for mobile and social media.

That’s why Computer Weekly has started to look at the technology startup scene from the CIO’s perspective.

You can download our special digital magazine issue on tech startups here, or read all the content we’ve produced on the topic online here.

At the best of times, innovating with technology is a challenge for IT leaders and even more so in a sluggish economy, when much of the focus is on cost control. It’s hard for many decision-makers to find the time to research technology startups and identify the creative small companies with innovative ideas that could add value to corporate IT.

That’s why so many IT managers end up relying on their incumbent suppliers, many of whom remain in the slow lane when it comes to genuine innovation.

With the growth of cloud, startups now have access to computing facilities and software tools that would have been beyond their reach only a few years ago.

And they are putting it to good use – there are plenty of emerging startups, focused on business technology and the needs of CIOs, who just need an introduction to IT buyers who recognise the innovation that can come from taking a different approach.

Similarly, those CIOs need a better way to find out more about how to find and work with startups.

We hope we can help.

Over the coming months, Computer Weekly will publish profiles of a wide range of business-focused technology startups, introducing the innovations they bring to IT leaders. If you’re a startup looking to push your products to a corporate IT market, get in touch – we are keen to talk to you.

IT managers looking for new ideas and fresh thinking would benefit from taking the time to reach out to startups and find out how they can help deliver innovation for your organisation.

June 10, 2013  4:39 PM

Morality and ethics – the ‘next big thing’ for IT suppliers

Bryan Glick Bryan Glick Profile: Bryan Glick
Amazon, Facebook, Google, Microsoft, NSA, Prism, privacy, snooping, trust

Nobody in the IT profession can be disappointed that technology has become such a central part of the way we all live and work.

For anyone who has been in the industry for 10 or more years, it is fantastic to see IT taking its central place in business and society; for technology to become cool at last; and for IT experts to no longer be dismissed as the geeks in the basement.

IT is enabling so many positive things – changing our world in the biggest social and business revolution since the industrial age.

But with that greater influence, comes greater responsibility. It is inevitable there would be a backlash, and that backlash is well and truly underway.

IT was at the heart of the global boom in financial services. Today it stands accused of enabling the behaviours of bankers that crippled Western economies.

Facebook and social media have transformed personal communications, enabled new communities and improved information sharing for all. But at what cost for privacy of our personal information.

Google and Amazon have made it easy to find information, to buy quickly and cheaply, opening up new knowledge and commercial opportunities. And they are pilloried as arrogant tax avoiders.

But the biggest example of the dark side of technology so far is dominating front pages and web pages alike around the world – the US National Security Agency (NSA) monitoring of electronic communications, and the allegations of complicity on the part of the global internet giants that provide that data.

Look at all the great things the web allows us to do – and look at how easy that makes it to create a surveillance society. As someone said recently, if you could give George Orwell one Tweet from beyond the grave, he would write: “I told you so #Prism”.

This backlash is an inevitable stage in the progress of technology and the digital revolution, but of course it presents challenges on a scale that the world has never before had to comprehend.

Today we call people who resist the tide of technological change Luddites, but the textile workers who gained that name when they destroyed the mechanised looms that threatened their livelihoods in the industrial revolution were simply examples of the 19th century version of the backlash that technology will have to go through in the 21st.

The immediate aftermath of the NSA Prism revelations will see greater demands from governments for Google Facebook, Microsoft et al to establish local datacentres for their cloud services that ensure data is not shipped into leaky US-hosted servers, and subject instead to local laws and oversight. (Not that locally stored data would be any less surveilled by those governments, of course).

We will see more “walled gardens” created, often to the horror of internet evangelists who rightly say the strength of the web is its openness and collaborative nature. More people will want to know that their web activity is actively protected, and will use the open web only for less sensitive information.

But what we will also see, eventually, is morality and ethics becoming one of the ways in which technology companies of all kinds are judged.

Post-industrial revolution employers who embraced trade unionism were revered and grew their business through their acknowledgement of the new relationship between company and workers.

In the same way, tech firms of tomorrow will need to demonstrate they are able to manage the increasingly fine line between opportunity and responsibility that the digital world creates.

Protecting privacy will be a badge of honour, not a 50,000-word statement of terms and conditions. A transparent recognition of the needs of the intelligence services and how that affects users will engender trust. Even more likely will be the rise of services that put personal data back where it belongs – in the hands of web users, not web providers.

The whole nature of the relationship between technology firms and their users – both consumer and corporate – is going to change before the digital revolution is complete.

But before that happens, the dark side of technology is going to dominate the headlines. For smart IT suppliers looking for a new way to differentiate themselves, trust, morality and ethics are the next big thing.

June 6, 2013  5:05 PM

DCMS land-grab is a threat to IT’s political and economic future

Bryan Glick Bryan Glick Profile: Bryan Glick
DCMS, economy, government, IT skills

The IT industry’s vital role in the UK economy is under threat from what appears to be a desperate attempt by a Whitehall department to avoid being cut back or even scrapped in chancellor George Osborne’s forthcoming spending review.

The Department for Culture, Media and Sport (DCMS) has quietly issued a consultation on a seemingly very dry and uninteresting topic – the industrial and occupational classifications that determine what constitutes a creative profession.

This is all about SIC codes and their ilk – the standard classifications used by government and other agencies to pigeon-hole job roles and companies into the right sector for statistical analysis by the likes of the Office for National Statistics.

So far, so dull.

But in a bizarre land-grab to redefine whole sections of the economy as being “creative industries”, the consultation proposes to reclassify more than half of the IT industry as “creative”, thereby reducing the remainder of the official classification of the IT and telecoms sector to less than half its current size – and hence half its current economic contribution.

Thanks to e-Skills UK, the tech sector skills council whose briefing paper brought this issue to Computer Weekly’s attention.

According to DCMS, the proposal is justified because, “The ‘creative intensity’ approach leads to the introduction of a number of software and IT industries since the ‘digital creative’ parts of these sectors can now be better identified… Adoption of the ‘creative intensity’ approach provides a rationale for their inclusion and the current view supported by industry and partners is that these activities are vital to the Creative Industries.”

The split would produce some absurd anomalies. For example, IT directors would be reclassified as a creative occupation. But the IT managers, project managers and technical staff that work for them would remain classified under IT.

Business analysts, architects and software developers would also become creative professions, not IT jobs.

Such a move would take 445,000 people out of the official designation of the UK IT profession, reducing the size and influence of the official IT occupation, as follows:

As e-Skills points out, the DCMS proposals could also lead to some ridiculous reclassifications of IT companies.

For example, Microsoft or Oracle – as software suppliers – presumably become part of the creative industries instead. While Dell or Cisco – predominantly hardware – stay as IT.

What about IBM – a major software producer and a large hardware company. IT or creative? Or do half its employees move into creative and the rest stay in IT?

It’s a completely ludicrous situation, so why would DCMS even consider it?

It can only be an attempt at a land-grab to protect or increase the department’s budget. The bigger the “creative industries”, the more cash (and the less austerity cuts) goes to DCMS.

There are even rumours around Whitehall that the future of DCMS is in question – it may be scrapped and its functions merged into other departments as part of the spending review cuts.

Of course, if you can show that the creative industries for which you are responsible are growing so quickly and a much bigger part of the economy than you realised – thanks to those dull but lovely SIC codes – it makes it harder to justify that decision.

Does it really matter though, for people and companies in IT? Well, yes.

A much-reduced rump of workers and businesses classified as IT makes a much-reduced contribution to GDP. It becomes less strategic to UK economic recovery, receives less focus, less cash, less ministerial and political attention all round.

Meanwhile, those employees and employers now reclassified as “creative” get affected by policies that are designed to support actual creative industries, such as music, movies, arts and crafts, architects, town planners, dancers and choreographers.

It’s all very well to say that IT directors need to be more creative, it’s not the same to classify them as such. Only 3% of IT professionals actually work in the UK creative industries today. But at least in future those reclassified CIOs would benefit from any new tax breaks on ballet shoes.

Computer Weekly has pointed out the government’s ignorance of IT, technology and digital and its fundamental role in the future of how we live and work. It’s bad enough that so little is done to give strong economic and political support to the UK IT profession, but cleaving the sector in two will guarantee its dismissal to the margins of government policy.

The DCMS consultation concludes on Friday 14th June – if you agree that this proposal is the huge threat to the IT sector that it first appears, please respond to that consultation while you can.

May 30, 2013  4:59 PM

Which IT suppliers have not yet seen the cliff approaching?

Bryan Glick Bryan Glick Profile: Bryan Glick
AWS, Big Data, Cloud Computing, Dell, digital, Google, HP, Open source, PC

Watching the IT industry at the moment is a little like reading a good crime novel. There are pieces of evidence appearing, from various sources, often apparently unconnected, but which all point to one inescapable conclusion.

The difference in IT is that this is not a question of “Who done it?” but of “Who hasn’t done it?”

One of the recurring themes I’ve been writing about on this blog is the nature of the disruptive change underway in the IT sector, and the notion that the current change is not gradual and evolutionary, but a path to a cliff, and once you’re over that cliff there’s no going back.

It’s the case in the PC market, with Dell and HP bound to the past by inertia and old business models as PC sales suffer record declines.

It’s happening in business too, with retailers like HMV, Comet and Blockbuster failing to spot the dramatic shift to digital.

And another area the cliff is going to appear suddenly in front of a lot of suppliers is the cloud – and here is the latest clue to how this one is going to play out.

This time, research from Morgan Stanley has predicted a dramatic increase in revenue to Amazon Web Services, the web giant’s cloud computing operation.

The firm forecasts that as much as 17% of current IT spending in some technology sectors will move to cloud-based services within five years, with Amazon the primary beneficiary. Morgan Stanley warns that suppliers of server and storage technology are likely to suffer as a result.

The only argument seems to be over just how big AWS will become, and how quickly. According to this article at GigaOm, Morgan Stanley says AWS will reach $24bn in sales by 2022, compared with an estimated $2bn now.

The article also says that Macquarie Capital predicts AWS will hit $38bn revenue in five years, taking up 53% of all cloud spending.

One of my favourite industry commentators, Simon Wardley, has written about a “punctuated equilibrium” where some markets – such as cloud – go through an accelerated, exponential growth, which takes incumbents by surprise.

Wardley has extrapolated Amazon’s growth to suggest it is possible AWS revenue will be the equivalent of 50% of current global server sales in just five years. That’s a big cliff with a long drop for some.

It’s not just Amazon, of course – although the company has a major head start on its rivals.

Google is gaining growing credibility as an enterprise supplier, and while its corporate revenues are relatively small today, there’s every chance they will go through a similar boom in coming years. It will mean IT departments getting used to doing things differently – “We were trying to put a consumer product into a traditional enterprise and we have grown up together,” said an IT leader at Rentokil, an early adopter of Google Apps.

But Google will be a threat in many sectors of corporate IT.  

Commodity open source tools similarly promise to cause a shake-up in business intelligence, information management and data warehousing, as cloud-based big data services disrupt the existing players.

The other difference between IT and a crime novel is that all this is entirely predictable, and you don’t need to read the final page of the book to know what’s going to happen. We’ll find out “who hasn’t done it” when those suppliers fall off the cliff.

May 24, 2013  1:16 PM

Is this the most remarkable government statement on IT yet?

Bryan Glick Bryan Glick Profile: Bryan Glick
CTO, DECC, Government IT, lock-in, oligopoly, Outsourcing, Whitehall

If any of the big, incumbent Whitehall IT suppliers have not yet done so, they really need to read this web page.

It’s part of the new Government Service Design Manual, launched earlier this week by Whitehall CTO Liam Maxwell – it is effectively a guide for how to select, purchase, design and run IT across government.

It’s not an IT strategy – there have been numerous of those in the past that failed entirely. It is instead a set of guidelines that state, among other things, how government IT buyers should engage with IT suppliers from now on.

The page, “Creating a culture that supports change“, is, frankly, a scathingly public critique of the cosy relationships forged by the so-called oligopoly of system integrators and big software firms that have dominated Whitehall IT spending for many years.

It also reflects the denial that many of those suppliers maintain as reformers led by Maxwell try to drastically reduce or even eliminate the comfortable, ongoing, large revenue streams that have poured in from the public purse through long-term outsourcing contracts.

Take some of these excerpts from the official government manual as examples:

“It may be necessary and more cost-effective to write-off previous financial investments, so you will need courage and conviction to stop spending on old, legacy systems.”

“Your existing supplier base will tend to resist change – and the more successful a supplier has been working under the old model, and the more entrenched it is, the greater this resistance is likely to be. The changes needed will often be more successfully initiated and delivered by those not encumbered by past success – new market entrants and those traditionally closed-out from government business, such as small or medium-sized businesses.”

And these paragraphs are perhaps the most remarkable public statement of intent from any government IT leader:

“If you have incumbent suppliers, it is important that you understand and anticipate their likely reaction as they struggle to maintain the status quo and resist change.

“Incumbent suppliers will have data that reflects the past success of their business models and the way their business worked. They will be less certain about the future and may be concerned about the weakening of their market share and their exposure to genuine, open competition.

“The rewards and culture of these companies are likely to be built on their current business model. That will reinforce their internal resistance to change. It is difficult for them to persuade shareholders and financial investors to replace a well-understood, if obsolete, business model with an approach that favours the treatment of some IT products as commodities.”

That is a direct challenge to every major incumbent supplier; practically a determination to break the existing relationships – one that may even tread dangerously close to breaking competition law as it could be interpreted as a specific bias against such incumbents.

But the document doesn’t spare old attitudes in Whitehall either:

“You will also see similar resistance in-house, where many staff may have long grown accustomed to old ways of working… Some may have become dependent on external suppliers’ advice. Some may even have built their career on accreditation in a single supplier’s technologies.”

These statements are, of course, precisely what critics of government IT have been saying for a very long time – and what reformers have been saying privately for the past couple of years. But to see them in a formal government document is really remarkable.

There was a notable moment in Maxwell’s interview with Computer Weekly to coincide with the launch of the Service Design Manual. Our reporter, Kathleen Hall, asked him if the manual would help departments who have big outsourcing contracts coming up for renewal in the next two years (of which there are many).

Before she could event complete her sentence, Maxwell interrupted to correct her: “No. A lot of departments are having contracts FINISHED in the next couple of years.”

It is certainly the case that some suppliers have yet to grasp this reality.

Computer Weekly wrote a story recently revealing that the Department of Environment and Climate Change (DECC) is the only Whitehall department unable to adopt cloud computing yet, because of a lock-in with system integrator Fujitsu.

The DECC press office confirmed this in a statement: “Nearly all of DECC’s IT services are currently outsourced to Fujitsu as part of a contract that expires on 31 March 2014. There are significant cost implications in moving to cloud services in advance of this contract expiring. Therefore DECC has planned the introduction of cloud services to coincide with the end of the Fujitsu contract, meaning DECC will adopt a range of ICT cloud services starting on 1 April 2014.”

Fujitsu responded to us, claiming the story was inaccurate, and politely suggesting we remove it.

Needless to say we disagreed – backed up by the strength of the DECC statement. Lock-in is not only technical or contractual – having your budget tied up by a major outsourcing deal is just as much of a lock-in to any supplier or technology solution.

As the Service Design Manual defines elsewhere:

“Technology lock-in happens when previous decisions regarding technology limit future decisions, possibly so that only one real choice exists.”

It continues:

“In general, you should avoid making long-term commitments to any particular technology, product or supplier until you fully understand the problem you’re trying to solve – and even then, you should ensure you maximise your future development options.”

It’s important to add that there is nothing in the Fujitsu contract that specifically restricts DECC’s ability to use cloud – it is purely a budgetary decision from DECC that it cannot do so while that contract is in place. And I’m using Fujitsu purely as an example – this is not meant as a specific criticism of that company, which continues to work closely with DECC on its current contract and commitments.

But it seems likely that several major outsourcers are yet to fully accept that the landscape is changing and their relationship with their government customers will be very different when their contracts expire.

As the Service Design Manual states:

“Your existing supplier base will tend to resist change – and the more successful a supplier has been working under the old model, and the more entrenched it is, the greater this resistance is likely to be.”

There will be a lot of big suppliers resisting change in the next two years, hoping that the 2015 General Election will sweep away the reformers. Their chances of success in t hat resistance are receding rapidly.

May 23, 2013  3:35 PM

If the PC is dead nobody told Lenovo

Bryan Glick Bryan Glick Profile: Bryan Glick
Dell, Desktop, HP, laptop, lenovo, PC, Tablet

Apparently we are in the post-PC era. The PC is dead. Deceased. Pining for the ffjords. Ceased to be. An ex-market.

But nobody seems to have told Lenovo. Look at the latest quarterly sales figures.

PC revenues in Western Europe fell 16% in the first quarter of 2013. PC sales at HP fell 20%. At Dell, profits from its PC business were down 60%.

Yet here’s Lenovo – sales up 15% to $34bn, profits up 34%, European shipments up 11% and market share in the region up 12%.

The Chinese giant is doing something right, something that the fading PC giants of HP and Dell seem unable to do.

There’s no disagreement that the PC market is in decline, and will have to share buyers’ cash with tablets and high-end smartphones. But there is still money to be made, and will be for some time, for those suppliers who have the necessary focus and customer understanding.

And yes, that’s a not-even-vaguely-disguised criticism of Dell and HP, both of whom have taken their eye so far off the ball that you have to wonder if they can feasibly turn around their PC businesses. Michael Dell clearly doesn’t think so, given his attempts to buy back the company and transform into an infrastructure supplier.

Lenovo also points to an early move into tablets as a factor in its growth – and it still seems incredible that neither HP nor Dell have produced a genuinely competitive product for the tablet buyer.

The IT market is rapidly diverging. It is going to be increasingly difficult to be a broad-based, do-a-bit-of-everything supplier. You will need focus, specialisation, agility – staying close to IT decision-makers and understanding their needs. Obvious, really, you’d have thought.

Dell’s future is being decided in investor arguments about whether or not to leave the stock market – a distraction the firm could do without.

HP’s future is being decided, well, slowly. CEO Meg Whitman’s “multiyear turnaround plan” is being given generous scope by investors, but it seems customers are losing patience.

The industry is reshaping itself, more big names will fall by the wayside, and the suppliers that IT leaders turn to will be very different by the end of this decade.

May 14, 2013  5:01 PM

Is G-Cloud changing the behaviour of the big IT suppliers?

Bryan Glick Bryan Glick Profile: Bryan Glick
Cloud Computing, CloudStore, datacentre, G-Cloud, Government IT, Memset, Oracle,, SME

The government’s G-Cloud has its critics, who like to cite the relatively few millions of pounds of spending put through the programme as being tiny compared to the annual £16bn government IT spend.

But – putting aside the obvious counter argument that such change takes time and plenty of Whitehall buyers remain locked into costly outsourcing deals – there are significant signs that G-Cloud is having an even more important impact.

The initiative was intended to open up the market to SME suppliers, to reduce lock-in to long-term contracts, and create transparency of pricing. It’s doing all those things. For example, one smaller supplier, Memset, says it has seen its G-Cloud revenue grow 38% in just six months.

To reiterate the importance of G-Cloud, the government now has a cloud-first buying policy.

However, when G-Cloud really makes its mark is when it makes the big suppliers change their behaviour.

At the start of this month, announced plans for its first UK-based datacentre – effectively a condition of being able to win business through G-Cloud due to data protection regulations around government data.

Now, Oracle has announced it is building a new UK datacentre specifically to deliver government IT services through G-Cloud. Oracle considered this so important that it brought its president, Mark Hurd, to the UK to make the announcement.

Do not underestimate how significant a move this is.

If suppliers of the size and influence of Oracle are seeing the writing on the wall saying they have to conform to the requirements of G-Cloud to continue their business with Whitehall, that is a major power shift in that relationship.

Oracle was identified as holding 70% of all government software licences, receiving more than £200m in revenue from Whitehall every year.

The Cabinet Office told Computer Weekly last year that Oracle was one of the worst culprits for price inconsistency – charging up to three times more to some departments for the same products.

And there was a furore earlier this year after the publication of an official notice for a £750m Oracle framework agreement – a deal that seemed entirely at odds with the Whitehall IT reforms of which G-Cloud is a central component.

I was told that agreement would be quietly shelved – a case of cock-up not conspiracy, said insiders – but it demonstrated the prevailing mood that Oracle for too long had the government over a barrel.

The fact that the software giant is now investing in a new datacentre, apparently as a direct response to the growth of G-Cloud, is a sign that the balance of power between government IT buyers and their suppliers may finally be shifting in the right direction.

May 9, 2013  1:39 PM

Help us to recognise the role models for women in IT

Bryan Glick Bryan Glick Profile: Bryan Glick

We’re proud to this week launch our second annual quest to select the 25 most influential women in UK IT.

The issues affecting women in technology have only become more important and high profile in the past 12 months. National newspapers have picked up on the theme – our poll last year even got a mention on BBC Radio 4’s Women’s Hour show.

In that time we’ve also launched a LinkedIn group for women in IT, which has proved extremely popular. Women in IT is a thriving community of interest, and a positive influence on the wider profession.

Last year’s programme, which saw Thomson Reuters CIO Jane Moran voted the most influential woman in UK IT, was a big success and generated a lot of debate. We’ve since seen a definite increase in the number of female IT leaders attending our monthly CW500 networking events – although they are still a minority.

The issues that continue to restrict women to barely 18% of the UK IT workforce have not gone away though – a macho, male-dominated, geeky image; inflexible working patterns; difficulties catching up with new technologies for women returning after career breaks to have children; and so on.

But there has rarely been wider appreciation of the problem, and of the benefits of having more women in the IT workplace. More IT leaders say they want to recruit more women – although often the challenge is finding enough women with the right skills to apply for such positions.

The IT industry is changing the way everyone works and lives – with flexible and remote working becoming key to resolving work/life balance issues, as well as making organisations more agile and mobile. As such, IT leaders need to take the initiative to make the IT profession one which exemplifies such principles and comes to be seen as one of the most female-friendly sectors to work in.

IT needs a workforce that has the skills, experience, and diversity to innovate through technology – and one that reflects the diversity of the people using technology every day.

It is often said that women are less likely than men to promote themselves. Identifying the most influential women in UK IT is our way to help get over that – and if you know a female in IT who deserves greater recognition as a role model for others, please let us know.

May 9, 2013  12:26 PM

Michael Dell says “I like to win” – but will he?

Bryan Glick Bryan Glick Profile: Bryan Glick
datacentre, Dell, HP, michael dell, Networking, PC, Servers, Storage

It’s become something of a common public perception that Dell is a company in crisis.

Fourth-quarter revenue down 11%, profit down 31%, and its founder engaged in a battle with investors to delist from the stock market to buy time and space for a radical overhaul – these are pretty solid indicators that all is not well.

But Dell’s undoubted challenges are linked almost entirely to the decline in its core PC market. Look beyond the desktop and into the datacentre and the story is a lot more positive.

Server, networking and storage sales are on the rise, and Dell continues to be aggressively acquisitive as part of what its new UK CEO Tim Griffin calls an “accelerated transformation”.

So it was timely to be invited to meet with the senior leadership team from Dell’s enterprise solutions business, who were in London this week to meet customers, greet the troops, and no doubt try to reassure them all that the future is better than some of the press coverage would have you believe.

Executives were very non-committal on founder Michael Dell’s plan to take the company into private ownership – “Business as usual, no matter what happens,” declared Marius Haas, president of the enterprise solutions group, closely followed by the usual stream of carefully rehearsed on-message statements that you get from most US senior managers at IT suppliers.

(I can’t help but think the company would benefit from a more down to earth response to inevitable questions about the de-listing plan – “Things are tough, we admit that, and we know radical changes are needed, but we’re going to do what it takes” – that sort of thing. But on-message was the big message).

Dell’s server chief, Forrest Norrod, was typical of the bullishness among the non-PC business divisions, predicting that Dell will be the number one x86 server supplier by the end of the year.

Critics say that Dell missed the rise of the cloud, but Norrod says differently – while Dell may not be competing as a public cloud provider, it is a major supplier of servers and storage to companies that are, and is doing nicely as a result, he says.

Every exec was all too happy to point to chief rival HP as a better example of a company trying to shed a reputation as a basket case.

But the server chief told me an anecdote that perhaps gives the company’s best response to the critics.

He was up late one night, unable to sleep, when his email pings with a message from Michael – at one o’clock in the morning. Norrod proceeds to engage the CEO in a back and forth that lasts until nearly 2am. Jokingly, Norrod emails Michael to say – hey, we’ve both got kids, what are we doing talking business at this time of the morning?

To which Michael Dell emails back to conclude the conversation with a single sentence: “I like to win”.

Dell’s transformation is essential and nobody will pretend it’s going to be easy (well, when they’re not relentlessly on-message, at least).

One of the great fallacies about Dell is that the consumer decline in PC sales is life threatening – that’s simply not the case. About 80% of Dell’s PC sales have always come from businesses – falling consumer sales sting, but are not the biggest problem.

There will be one more iteration of corporate PC sales for Dell as customers upgrade from Windows XP to Windows 7 before the end of XP support in April 2014. But that will be the catalyst for a subsequent slump in the corporate PC market too, and that’s the deadline by which Dell has to resolve its dilemma and reduce its reliance on the market for which it has always been best known.

You used to buy from Dell because of its great supply chain – quality, highly customised PC configurations, delivered cost-effectively and quickly. Then everybody improved their supply chain and that advantage was reduced.

It’s taken a long time to get the company out of that mindset. I can remember being told Dell was on the road to being a software and services company nearly 10 years ago. IT services and outsourcing was going to be the saviour – but that didn’t happen. So now, the immediate future is in the datacentre and eventually the cloud – an environment every bit as competitive as the PC market at its peak, albeit with somewhat higher margins.

Michael Dell is trying to achieve something that has never been done before – take a major, multinational, multibillion-dollar company off the stock market to change its structure and strategy, without the pressure and intensity of having to deliver growth to investors every three months.

I think he’s doing the right thing. The transformation needed at Dell simply could not happen under the rapacious watch of the financial markets. The scale of change needed does show that the change is happening later than it should – the emotional connection to the PC market is proving hard to break.

If he succeeds in de-listing, it will be an interesting few years comparing Dell’s behind-closed-doors transformation with HP’s very public and often painful “multi-year turnaround plan” under CEO Meg Whitman.

But you don’t found a company in your bedroom, grow it to a $60bn giant, and then not be up for a fight for survival.

Michael Dell likes to win. That’s no guarantee that he will, but his corporate customers should give him the time to make it happen – although their patience will not last forever.

May 3, 2013  11:34 AM

Election countdown begins for Whitehall IT reforms

Bryan Glick Bryan Glick Profile: Bryan Glick
cloud, Digital strategy, G-Cloud, Government IT, oligopoly, Open source, Outsourcing, Universal Credit

Two years from this week, it’s the next General Election.

Unless the Coalition collapses before 7 May 2015, the election date is fixed and immovable. That means there are just 24 months left for the IT reformers in government to make their changes equally immovable before the political will behind them potentially dissipates.

They have a lot to do.

In the three years since Cabinet Office minister Francis Maude set about tackling the IT oligopoly of big suppliers that dominates Whitehall IT, and so reduce the annual £16bn IT budget, much has been achieved.

We have a mandatory open standards policy; the first ever preference for open source built into the Digital Strategy; a cloud-first-policy emerging through the G-Cloud; and significant savings made from existing, long-term contracts with that oligopoly.

Just this week, we’ve also seen an important milestone as all the government departments completed their move to the new, open-source, agile-developed Gov.UK website – at a much reduced cost from its predecessor, Directgov.

But it’s equally easy for the critics to claim that apart from some lengthy documents, a new website, and a mere few millions pounds spent through G-Cloud, it would not be difficult to see a return to the bad old ways if the political clout enforced by Maude were to disappear.

Certainly the big system integrators are quietly confident that the irresistible force of change will not become an immovable object – this article quoting a senior HP executive published by Kable demonstrates just that, while also demonstrating how the big suppliers completely misunderstand what the reforms are all about.

Several big outsourcing deals come up for renewal between now and the election, and it will be instructive to see what happens and whether they will be extended. The response Computer Weekly received from the Department of Energy and Climate Change suggests it sees a future away from its incumbent supplier when its contract ends in 2014.

Without doubt there is a growing mood of IT reform across Whitehall – finally spreading to some of the formerly doubting departments, even if there are still tensions between the centre and some of the departmental IT teams.

Already some of the advisors closest to government CTO Liam Maxwell are forging links with Labour and the shadow cabinet in the hope of gaining cross-party support to ensure the reform process can continue regardless of the electoral victor. Don’t be surprised to see a debate about which party is the more “open” as the next two years count down. Wouldn’t it be great if IT reform became an election issue at some level.

But the biggest challenges for reform lie ahead.

A static, informational website is one thing, online transactions are another – the biggest test of the digital strategy will be when citizens are transacting with government online, not just searching for information.

The flagship of “digital by default” was to be Universal Credit, the biggest IT project in Whitehall and increasingly the most troubled. Already many of its digital initiatives, such as identity assurance, have been stripped out.

And the plans for open standards have yet to be tested in a major project – the Microsofts and Oracles of the world are not going to take it idly on the chin if they are excluded for non-conformance.

But there’s an undeniable buzz around Whitehall IT and the digital reforms, and that in itself is a measure of the achievement so far. The target has to be that by 7 May 2015, we no longer call these “reforms” but business as usual.

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