CXO 11 by GDS International

COVER CXO11 old:nov08 04/12/2008 10:55 Page 1

SURVIVAL OF THE FITTEST www.cxo.eu.com • Q4 2008

How Europe’s business leaders plan to weather the financial storm

MISSION CRITICAL Europe’s busiest CIO, PATRICK HÉRENG of Total, reveals the challenges of protecting the oil giant from cyber criminals PAGE 30

SHOP TALK Behind the scenes at the supermarkets of the future with METRO Group CIO ZYGMUNT MIERDORF PAGE 68

SPECIAL REPORT

THE

IP address management

MIDAS

TOUCH ANTONY JENKINS, CEO of Barclaycard, on how he will make credit cards extinct PAGE 24

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EDS NOTE cxo:dec08 05/12/2008 09:29 Page 3

FROM THE EDITOR

History in the making As 2009 approaches, nobody can predict how the credit crunch story will end.

“I think the economic conditions require us and any provider in the market to act as responsible lenders” Antony Jenkins, CEO, Barclaycard (page 24)

“I have to face a paradox which is not simple to solve. We have to open the system but at the same time secure the system more” Patrick Héreng, CIO,Total (page 30)

“It is a challenging time but we are convinced that with our business concept and the performance of our sales delivery, we are well positioned for the upcoming competition”

n years to come school children will study the credit crunch as one of the landmark events in modern European history. They will learn about the sequence of events that led to the collapse of some of the world’s biggest financial markets – and who, ultimately was to blame. Hopefully too they will be taught about how the world recovered from the storm and what safeguards were put in place to stop such a situation ever reoccurring – history that has not yet been written. Today, the global financial crisis is very much in the present tense – and is likely to remain so until well into 2010. It is impossible yet to sum up the full extent of the damage financial markets will suffer and how many companies across the world will collapse altogether as a result. Like all major historical episodes, there is a clear sequence of events that led to the event, starting with the irresponsible lending on the part of US banks involved in the sub-prime mortgage business. But, in common with wars and epidemics, a vast array of different socio and economic factors have contributed to how serious the impact of the credit crunch has been. What is most alarming about this situation is the speed at which market conditions are changing. This means that as a quarterly publication it is impossible for us to provide completely up to date information on business conditions in Europe. What we have done in this issue however, is feature interviews with some of Europe’s top business leaders, across a range of industries that have all been hit hard by the credit crunch. They represent very different industry sectors – ranging from banking, energy, retail, media, construction and transport – providing a view of business in Europe from all angles. What these business leaders share in common is a steely determination to forge ahead with major projects despite economic conditions: Antony Jenkins of Barclaycard has invested millions in developing contactless payment methods; Zygmunt Mierdorf is spearheading METRO Group’s research into futuristic shopping technology; and Claire Hamon of Rok Group aims to expand the company’s branch network across the UK. All three appear upbeat about the future despite operating under extremely difficult conditions. However there is only one way to find out whether these companies become the next victims of the credit crunch – keep a look out for the next issue of CXO Europe and watch this space.

Zygmunt Mierdorf, CIO, METRO Group (page 68) Diana Milne Editor

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CONTENTS FEATURES

Shop talk

Mission critical

Zygmunt Mierdorf CIO of Germany’s METRO Group, on why his company is developing technology that will make cash tills a thing of the past

Meet the CIO with arguably the most complex job in Europe – Patrick Héreng of Total – who controls a multibillion euro budget and is overhauling his company’s entire IT infrastructure

24 The midas touch In 10 years plastic credit cards won’t exist and we’ll be making payments using our fingertips and mobile phones instead. Or at least that’s what Antony Jenkins, CEO of Barclaycard, claims in this exclusive interview

44 Perfect blend Danske Bank CIO Peter Schleidt on achieving the perfect merger

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CONTENTS BUSINESS TECHNOLOGY, IPAM AND UNIFIED COMMS

INDUSTRY INSIGHTS 76 Andre Bonvanie, NewsGator 84 Paul Congdon, HP ProCurve 36 Track star CXO puts the woman in charge of IT at Network Rail in the hot seat

40 Going for broke The head of a leading insolvency practice reveals how many UK companies are going under

54 Believing in better BSkyB CTO Didier Lebrat discusses improving performance through technology

60 Addressing the future Ovum’s Graham Titterington on the road ahead for IP address management

66 Scoring big with Web 2.0

UEFA’s Daniel Marion on why football fans are going online to get their kicks

82 Cutting costs with conferencing How to weather the economic storm through virtual communications

108 Smart thinking CXO takes a look at plans for Europe’s next technology hotspot

118 Bricks, mortar and motherboards Claire Hamon, CIO of Rok Group, on how technology will help the company achieve ambitious growth targets

EXECUTIVE INTERVIEWS

144

42 Jimmy Afshar, Adeptic Technologies 58 Tim Rooney, BT Diamond IP 100 Herman Meuldermans, Escrow Europe 106 Solomon Edun, Global InfoSwift Technologies 112 Pablo Trilles, AuraPortal 126 Erik Moller, HP 128 Paul Gray, NRX 132 Bill Hewitt, Kalido

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CONTENTS SECURITY, DATA MANAGEMENT AND HR

ASK THE EXPERTS

THE NEXT BIG THING

134

74 Matthew Light, Tempura Communications 134 Prelini Chiechi, Adobe

ROUNDTABLES: 46 An architect of success, Central Telecom, Procession, HP and Oracle 88 Under lock and key, Absolute Software, Finjan and MyLaptopGPS HEAD TO HEAD: 136 Taking ALM to the next level, Borland and IBM CASE STUDIES: 102 Business continuity management, Escrow Europe 122 Virtual desktop deployment, Parallels 86 Meet the gatekeeper

124 Customer satisfaction

BlackRock CISO Ben Smith discusses his top security concerns

Bo Lykkegaard reveals his CRM predictions

130 Keeping your data ‘green’ 94 Fighting back

By Aberdeen Group’s Jeffrey Hill

PayPal CISO Michael Barrett on doing battle with phishing gangs

140 Automatic for the people The changing face of HR with Jacqueline Kuhn

98 Securing the future With 451 Group’s Nick Selby

142 Trouble at the top

104 New danger

A new report reveals a worldwide reduction in executive appointments

The credit crisis and business continuity management

144 Talent spotter

114 Changing mindsets

ABB’s Gary Steel on people management and winning the European talent war

How one company slashed its IT budget by changing its corporate culture

REGULARS: 12 The brief 14 European business round-up 16 Insight 18 Frontline 22 In my view 148 Leadership 150 Business doctor 152 On the shelf 154 City guide 156 The knowledge 158 Objects of desire 160 Final word

80 62 Clive Norris, Crypton Computers 64 Ron Santos, Alcatel-Lucent 78 Brett Caine, Citrix Online 80 Geir Langfeldt Olsen, TANDBERG 96 Laurent Dedenis, Acronis 116 Geoff Burkholder, HP

CREDITS CXO11:nov08 03/12/2008 14:49 Page 10

24-26 February 2009 Fairmont Le Montreux Palace Montreux, Switzerland

Chairman/Publisher SPENCER GREEN CEO/Publisher JAMES CRAVEN Director of Projects ADAM BURNS Editorial Director HARLAN DAVIS

Editor DIANA MILNE Managing Editor BEN THOMPSON Associate Editor JULIAN ROGERS Deputy Editors NATALIE BRANDWEINER, MATTHEW BUTTELL, FRANCES DAVIES, REBECCA GOOZEE, MARIE SHIELDS, HUW THOMAS

Creative Director ANDREW HOBSON Design Directors ZÖE BRAZIL, SARAH WILMOTT

The Next Generation Pharmaceutical Summit is a three-day critical information gathering of C-level technology executives from the pharmaceutical industry. A Controlled, Professional & Focused Environment NGP ’09 is an opportunity to debate, benchmark and learn from other leaders. NGP ’09 is a C-level event reserved for 75 participants that includes expert workshops, facilitated roundtables, peer-to-peer networking, and coordinated technology meetings.

Associate Design Directors MICHAEL HALL, CRYSTAL MATHER, CLIFF NEWMAN Assistant Designer ÉLISE GILBERT Online Director JAMES WEST Online Editor JANA GRUNE

Project Director OLLIE STEBBINGS ostebbings@gdsinternational.com Senior Sales Executives IAIN GETHIN, HELEN JACKSON Sales Executives JESSICA RICHARDS, RAY DAVIES, JOE HUNTER, WILL MORRIS, GARETH JONES, MARK BAKER

A Proven Format

Finance Director JAMIE CANTILLON

This inspired and professional format has been used by over 100 R&D executives as a rewarding platform for discussion and learning.

Head of Production and Events ROBERT SIMMS

“A well organized and productive meeting with good topics and open discussion – worth the effort!” Dr. Mark Burfoot, Pfizer

Production Coordinators HANNAH DRIVER, HANNAH DUFFIE, JULIA FENTON Director of Business Development RICHARD OWEN Operations Director JASON GREEN Operations Manager CHRISTIAN MORATO Subscription Enquiries +44 117 9214000. www.cxo.eu.com General Enquiries info@gdsinternational.com (Please put the magazine name in the subject line)

“This meeting provided an excellent opportunity to meet key thinkers in the clinical study pharma space and to present the contributions of our technology to them.” Scott Watson, Aperio

Find Out More Contact NGP at 212 920 8181 www.ngpsummit.eu.com

Letters to the Editor letters@gdspublishing.com

Legal Information The advertising and articles appearing within this publication reflect the opinions and attitudes of their respective authors and not necessarily those of the publisher or editors. We are not to be held accountable for unsolicited manuscripts, transparencies or photographs. All material within this magazine is ©2008 CXO.

GDS International GDS Publishing, Queen Square House, 18-21 QueenSquare, Bristol BS1 4NH. +44 117 9214000. info@gdsinternational.com

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THE BRIEF ANALYSIS

CRUNCH TIME As the credit crunch bites, European businesses face an uncertain and precarious future. THERE WAS NEVER ANY DOUBT that the reverberations would be felt in Europe from the subprime mortgage crisis. But few anticipated, when the news of America’s woes first broke, that the tremors would be quite so strong. So strong in fact that they succeeded in collapsing Europe’s largest economy – Germany – giving little hope to its weaker neighbours. An attempt by the European Central Bank to prevent widespread recession by lowering interest rates to 3.25 percent from 7.5 percent failed and shortly after Germany’s announcement the entire

www.cxo.eu.com

Eurozone was declared to be in recession. According to EU figures the Eurozone economy shrank by 0.2 percent in the third quarter of this year, following a 0.2 percent drop in the previous quarter. The questions now on everybody’s lips are: how low can the economy go and which industries will be worst affected? The European Central Bank’s solution to the problem is to continue to drop interest rates in an attempt to boost consumer spending. In November the ECB lowered its key interest rates to 3.25 percent and further cuts are expected with some predicting rates as low as two percent. However, predictions for the strength of the Eurozone in the coming year are not good. Analysts working for Bank of America have predicted the Eurozone economy could shrink by a further one percent next year. Meanwhile, widespread unemployment is expected across the continent. Within the UK alone, according to the British Chambers of Commerce, up to one in 10 workers could lose their jobs if government plans to kickstart the economy fail.

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THE BRIEF ANALYSIS

The BCC claims that in a worst case scenario unemployment figures could reach 3.25 million in the UK. Meanwhile the European Commission has predicted unemployment across the continent could reach 8.7 percent in 2010 from its current rate of 7.2 percent. Already mass redundancies have taken place across some of Europe’s biggest companies including Rolls Royce, BAE Systems, AstraZeneca, Sony Ericsson and GlaxoSmithKline. Companies across most industry sectors have been hit hard by the financial crisis, with industrial production down across Europe by almost five percent in October. Companies within the auto and construction industries have been particularly badly affected by the crisis. Figures from the European Car Makers’ association (ACEA) revealed that sales of cars were down by 14.5 percent in October for the sixth month in a row. One of the companies that has been hit the hardest is General Motors’ Germany-based Opel Unit, which is seeking loan guarantees from the German government as protection against the financial problems that have beset its parent company. House builders have also been hit hard as the credit crunch slows house buying to an all time low. The UK’s biggest housebuilders have been forced to write-off a combined UK£2.7 billion in assets this year and the number of new houses built during the next 12 months is due to fall as low as 50,000 from 60,000. On the high street widespread shop closures are expected across Europe with many companies already experiencing profit slumps despite pre-Christmas sales. It is impossible to predict with any uncertainty how dire the European financial situation will become but hopes are pinned on a €200 billion economic recovery plan, which was unveiled by the European Commission as CXO went to press. The plan would includes a combination of tax cuts on areas such as VAT, energy efficient goods and labour taxes – and investment in hard hit sectors such as construction and the auto industry. Meanwhile companies are bracing themselves to feel the full force of Europe’s economic crisis in a new year which shows little sign of emerging from the current gloom.

CREDIT CRUNCH IN PICTURES

FLOOR TRADERS at the New York Stock Exchange trade Citigroup stocks

A BUS passes the Bank of England displaying a message for city workers

‘CREDIT CRUNCH’ chocolates for sale in Selfridges department store

ANGRY REYKJAVIK residents vent their fury over the country’s financial meltdown

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EUROPEAN BUSINESS ROUNDUP NEWS

CREDIT CRUNCH SPECIAL How the global financial crisis is affecting European countries.

FRENCH PRESIDENT NICOLAS SARKOZY has announced plans to raise billions of euros for a sovereign wealth fund to protect French companies from the economic downturn. The fund will be endowed with funds from minority stakes it holds in companies such as Renault and Air France-KLM. Sarkozy said the purpose of the fund will be to protect French companies from purchase by “foreign predators”. “I won’t let foreign funds get bargains thanks to the current levels of the stock market. I won’t let French industry move out,” he added. France is one of the only countries in the Eurozone whose economy did not shrink in the third quarter of this year. It reported growth of 0.14% in the three months to September. Sarkozy has also joined other European countries in announcing a stimulus package to revive the economy.

FRANCE 14

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GERMAN CHANCELLOR ANGELA MERKEL has warned next year could bring more bad news for the country, predicting its economy could hit rock bottom. Her words follow the results of a poll by the German Economic Institute, which indicated that only 52% of all businesses in Eastern Germany and 45% in Western Germany would hold onto their employees in 2009. The German government has been criticised for not doing enough to stave off recession despite announcing a package that included €12-12 billionworth of tax breaks and incentives aimed at generating €50 billion in investments.

GERMANY

THE IRISH REPUBLIC has sunk into recession after its economy shrunk for the second quarter in a row. According to the Central Statistics Ofﬁce, the country’s GDP contracted by 0.5% in the three months leading to June. Economists attribute the recession to the slump in the country’s previously buoyant housing market. Unemployment across the country in October reached its highest levels since 1998 – 6.7%.

IRELAND

A WAVE OF MASS REDUNDANCIES has swept the UK amidst attempts by the government to stem the crisis. In just one week in November the number of jobs lost in Britain reached 25,000. Of those, 600 jobs went from the defence, aerospace and drugs industries including BAE Systems, Rolls Royce and AstraZeneca. The UK government has announced a stimulus package including a range of tax cuts and government spending projects totalling €23 billion in the next 18 months. The package also included cutting VAT to 15%.

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EUROPEAN BUSINESS ROUNDUP NEWS

THE NETHERLANDS

SPAIN

THE DUTCH GOVERNMENT has launched a €6billion economic stimulus package to help the country survive the global ﬁnancial crisis.

THE SPANISH ECONOMY will have achieved growth of around 0% in the second half of the year, according to the country’s Central Bank.

Its value is equivalent to around 1% the country’s GDP. The package will include measures to help boost corporate liquidity

Spain was previously the fifth largest economy in Europe and expanded by around 3.7% last year. But the 10-year property boom that helped buoy up its wealth has been hit hard by the international credit crunch and by rising interest rates.

ICELAND’S GOVERNMENT HAS AGREED to pay compensation to savers affected by the collapse of the internet bank Icesave after securing a €1.6 billion loan from the International Monetary Fund. Under the Icelandic depositor protection scheme the first €20,887 that savers lost when Icesave’s parent company was nationalised in October will be protected. The loan is aimed at restoring confidence in the Icelandic economy and made Iceland the first European country to receive an IMF handout since 1978. Iceland has been forced to take over three of its most debtladen banks and the IMF has warned that the country’s economy could contract by a further 10% next year.

ICELAND

DENMARK’S STERLING AIRLINES has ﬁled for bankruptcy after rising oil prices and dropping demand for air travel reduced the airline’s proﬁtability.

BANKRUPT ITALIAN AIRLINE Alitalia has been taken over by a group of private investors. The group is expected to launch a smaller private airline in Alitalia’s place.

The airline’s Icelandic owner Palmi Haraldsson ran out of money to support the business and then failed to ﬁnd a partner to take on the airline.

Alitalia collapsed with debts of around €1.2 billion and was spending around €3 million a day in the run up to its demise.

He told the Independent Newspaper: “Over a three to four week period the whole ﬁnancial system melted down and that resulted in our shareholder being unable to continue his support to the company.”

The Italian government gave the airline a €300 million loan but this was judged by the European commission to be illegal state aid so will not have to be paid back by the group of private investors.

DENMARK

ITALY

RUSSIA IS FACING FINANCIAL MELTDOWN with the World Bank predicting that the country’s economic growth will fall by 50% in 2009 to around 3%. The Kremlin has spent around US$57 billion defending the rouble against the damage caused by plummeting oil prices. In just two months the Russian stock market lost around two thirds of its value and industry production, which was growing at 5.4% at the beginning of the year has virtually come to a halt. One reason why the country has been hit so hard by the economic crisis is that Russia has such high levels of debt after relying on cheap credit from abroad for so long. The Kremlin’s response to the situation has been to lower the value of the rouble against a basket of currencies by 1% and to raise interest rates to 12%.

RUSSIA www.cxo.eu.com

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INSIGHT

COMPANY SPOTLIGHT ENVITEC BIOGAS It may not be the best-known European company but Envitec is making waves across the continent with its biogas plants reflecting growing demand for sustainable energy sources. ENVITEC BIOGAS was only set up in 2002 but has already shot up to the top of Standard and Poor’s Hot Growth Europe 2008 report which lists the hottest European companies with revenues of €1 billion or less. In the third quarter of 2008 it reported sales of around €32.4 million. As of the end of September the company had orders worth over €188 million with orders from foreign companies amounting to €57 million. The company operates its own biogas plants as well as planning, constructing and commissioning the facilities. It is currently engaged in building what is believed to be the world’s biggest biogas park with an electrical connected load of 20 megawatts in the German state of Mecklenburg-Western Pomerania. Envitec is represented across Europe with sales ofﬁces in the Netherlands, Italy, the UK, Hungary, Czech Republic, Ukraine, Romania and India.

HOT TOPIC: THE GERMAN AUTO INDUSTRY THE AUTO INDUSTRY, Germany’s biggest employer and the backbone of its economy is facing collapse following months of falling car sales and rising fuel prices. In August car exports dropped 2.5 percent their lowest since 2003 – and in 2008 the number of new German vehicles sold to customers is expected to plummet by 100,000 to around 3.1 million. In 2009 sales are expected to drop further to below 3 million. The situation has caused widespread panic across the industry with four major manufacturers all seeking government assistance. Opel has requested a loan guarantee from the government which would be worth around €1 billion. Meanwhile Daimler, BMW and VW have requested government loan guarantees on loans taken out by their ﬁnancing divisions. They have also requested the German government to reward customers with a premium for replacing a car that is over 10 years old with a new one. Some experts predict that up to 10,000 jobs could be lost within the German car industry within the next 10

years. BMW has already cut over 8000 jobs and has shut down production at its plants for weeks at a time – as have Volkswagen and BMW. The situation could have serious repercussions for other industries in Germany too. According to the German electrical and electronics industry association a third of German electronics makers are dependent on the auto industry. Almost 10 percent of engineering industry sales go to the auto industry and one out of 10 trucks in the country drives on behalf of the auto industry, as reported in Reuters. The newswire reported that as a result of the slump in the auto industry around 50,000 transport job cuts were expected this year. One way to resolve the problem would be for car manufactures to move their production facilities out of Germany and into cheaper emerging markets such as Russia or Asia. Such a move would end Germany’s long dependence on the auto industry and could fundamentally alter the foundations of the country’s economy.

CREDIT CRUNCH ROUND UP Total cost of bailouts by global governments US GDP US$7,865 billion UK GDP £1,401 billion US rescue package US$700 billion UK rescue package £387 billion Eurozone rescue package €1,000 billion Source: BBC.co.uk

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INSIGHT

COMPANY 1 2 3 4 5 6 7 8 9 10

ENVITEC (Germany) Coal & Consumable Fuels ODIM (Norway) Industrial Machinery AXIS (Sweden) Communications Equipment BURCKHARDT COMPRESSION (Switzerland) Industrial Machinery PAYPOINT (Britain) Diversified Support Services CONNECTA (Sweden) IT Consulting & Other Services PV CRYSTALOX SOLAR (Britain) Electrical Components & Equipment PHARMSTANDARD (Russia) Pharmaceuticals LANDI RENZO (Italy) Auto Parts & Equipments AVENA GROUP (Britain) Application Software

SALES 2007 (€mil.)

PROFIT 2007 (€mil.)

RETURN ON CAPITAL

RECENT STOCK PRICE

MARKET VALUE

132.4 176.9 177.3

14.4 25.0 27.4

7.9 44.4 46.4

15.0 4.8 8.4

224.7 213.9 580.9

288.6 275.6 76.6

42.2 27.3 7.3

41.1 42.3 42.7

101.5 6.7 4.0

344.9 453.5 41.9

263.4 312.8 163.9 165.7

47.0 88.8 19.7 44.5

24.5 27.9 18.2 32.4

1.7 19.7 2.9 10.0

720.4 744.7 329.6 677.5

RED BLACK

IN THE BLACK/IN THE RED THE SWISS DRUG MAKER Novartis has announced a 32 percent jump in profits in the third quarter of this year. It reported net proﬁts of US$2 billion on sales of US$10.75 billion. For the nine months ending September 30 2008 the company’s net income rose by 19 percent to US$6.7 billion. Novartis has announced a management shake-up which will cut its costs by around US$80 milllion annually. Dr. Daniel Vasella, Chairman and CEO of Novartis, said: “Led by the enhanced performance of pharmaceuticals in all regions as well as solid sales growth in vaccines and diagnostics and productivity gains in consumer health, we have achieved strong results in the third quarter of 2008 despite signiﬁcant volatility in the global economic environment.”

EUROPEAN DRUG GIANT AstraZeneca has revealed plans to shut down three of its sites, in Spain, Belgium and Sweden by 2013. The company has also announced mass redundancies, slashing 1400 jobs in November. A further 250 jobs are expected to be cut over the next ﬁve years. In July this year it announced 4600 job cuts as part of an ongoing restructuring programme, which takes the total job loss ﬁgure so far to 7600. The company is facing strong competition from the manufacturers of cheaper generic drugs.

ISSUE IN NUM8ERS More than

60million

Source: Standard & Poor’s Compustats

THE TOP 10 HOT GROWTH COMPANIES IN EUROPE WITH ANNUAL REVENUES OF €1 BILLION OR LESS

phishing emails are sent everyday globally (p86)

METRO group boasts 290,000 employees in

Germany’s

150 countries (p68) Just

40%

of data centre power gets used by servers (p130)

Didier Lebrat heads up a team of 2000 technology Sky’s CTO

staff and contactors (p55) Network Rail’s Catherine Doran juggles an IT budget of

€230million

(p36) www.cxo.eu.com

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FRONTLINE

GLOBAL BUSINESSES LOOK FOR NEW WAYS TO THRIVE THROUGH SOFTWARE AROUND THE WORLD, organisations are facing an unprecedented need to do more with less, develop better products faster and compete in a global economy with distributed workforces. Surviving, let alone thriving, in these conditions requires an unprecedented level of innovation. Today, these new levels of innovation rely on increased dependencies on software delivery. Software is everywhere we turn. From the most mundane appliances to sophisticated online service providers, software is woven into the fabric of our lives. And IBM is helping to ensure that software is helping organisations develop and deliver cost-effective and more feature-rich products to market faster. IBM’s acquisition of Swedenbased Telelogic earlier this year extends Big Blue’s extensive history of

helping organisations meet their business needs with superior hardware, software and service offerings. Today, the two organisations are one, and clients are enjoying new levels of support in critical areas such as enterprise architecture modeling, change and conﬁguration management, requirements deﬁnition and management, embedded systems modeling and more. But that’s not all. As the company’s clients are learning at user conferences held around the world this month and last, a range of new products and enhancements are available now and on the horizon as IBM evolves and integrates existing product lines and moves even more new solutions available to companies that rely on software for business differentiation and competitive advantage.

TOP TIPS FOR MOBILE WORKING IF YOU DON’T WANT YOUR REMOTE WORKING EXPERIENCE to be a painful one follow this handy advice:

2 3 4 5 6 18

Don’t rest wrists or forearms on the edge of desks

Use the backrest of your chair and don’t slouch

Alternate between thumbs and fingers when typing on smartphones Don’t stick your chin forward or bend or twist your neck

Make sure there is nothing underneath your workstation that restricts your posture Take regular breaks away from the keyboard and screen

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FROM THE VAULT

CXO issue nine, spring 2008

KIM FOURNAIS, Co-CEO of Danish trading bank Saxo Bank. Back in issue nine of CXO, Kim Fournais revealed the secrets of his bank’s success and his leadership style. “Leadership is about establishing the right team and empowering them, motivating them to do the right thing and ensuring that everyone knows exactly where we need to go.” To read more, go to the past issues section at www.cxo.eu.com and click on Embracing Technology within issue nine.

INDUSTRY VETERAN NAMED AS CEO ACRONIS, A PROVIDER OF AFFORDABLE, scalable storage management and disaster recovery software, has named technology industry veteran Jason Donahue as CEO. Donahue joins Acronis from ClearApp, where he served as President and CEO until its recent acquisition by Oracle. “Jason comes to Acronis with a track record of growing software companies, public and private, and leading them to deliver great products to customers and great value to investors,” said Ilya Zubarev, a member of the Acronis board of directors. “His global experience and background in key growth areas including virtualisation and data centre automation are a perfect ﬁt for Acronis as the company expands into new markets.” Walter Scott, formerly the CEO of Acronis, remains with the company in an advisory capacity. Scott, who remains a shareholder of Acronis, joined the company three years ago when Acronis revenues were less than US$20 million and built the company to its current levels — approximately US$120 million in revenue for 2008. Prior to serving at ClearApp, Donahue was the CEO of Meiosys, Inc., a virtualisation company that was acquired by IBM in 2005. Before that, he was CEO of Ejasent when it was acquired by Veritas in 2004. Donahue also served as CEO of TeleComputing Inc. and Apptix Inc., and served in executive roles at Cap Gemini Ernst & Young, and Telesphere Solutions. “I am very excited to be joining Acronis and I look forward to building on the company’s incredible success to date,” said Donahue. “Acronis has a solid line of backup and recovery products that I foresee delivering to a wider variety of customers, including larger enterprises.” Donahue holds a B.S. in Organisational Engineering and Management and an M.S. in Engineering Management, both from Stanford University.

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FRONTLINE UK CITIZENS TOP SURFING LEAGUE online (15 hours per week) while Brits lead the BRITS ARE THE MOST ACTIVE USERS OF THE INTEREuropean league with almost 14 hours. Spaniards on NET among European nations, the UK’s communicathe other hand spend the least time on the internet: tion regulator, Ofcom, has revealed in a report. It 7.5 hours per week. notes that the population are keen participants of Moreover, internet use per user has social networking sites such as risen fastest in the UK over the last Facebook and huge fans of online four years, at an average annual video games. Ofcom reportes Brits lead rate of 30 percent. British conthat there is nearly one broadthe European league with almost sumers also feature as the most band connection for every four frequent users of the internet people across the G7 most infor watching TV shows, but only dustrialised nations plus within the European club – they Poland, Spain, the Netherlands, per week spent on the internet come second after the Americans, Sweden and Ireland. In the EU, the biggest fans of online video. the UK, France and Germany, the Similarly, Brits lead Europe for use of Netherlands, Sweden and Ireland saw social networking services, with 50 percent using the highest average growth in connections besites such as Facebook, Bebo and MySpace – up 11 tween 2004 and 2007, at ﬁve percent per year. percentage on last year. Globally however, Canadians Across all the countries surveyed, more are the most active users of social networking, with 55 women than men were using the internet. The repercent of users participating. search found that US consumers spend most time

14 hours

CIO APPOINTED TO TACKLE FRAUD IN ANTICIPATION OF INCREASED LEVELS OF FRAUD as the UK economic downturn takes hold, Jarrod Haggerty, Partner at PricewaterhouseCoopers’ Forensic Services team, will take on the new role of Chief Information Officer on a six-month secondment at the Serious Fraud Office (SFO). Haggerty starts at the SFO in December and the appointment comes as ever more emphasis is placed upon how the UK tackles serious fraud and corruption amid the financial

turmoil. Haggerty is responsible for PwC’s Forensic Technology practice. His highly specialised IT consulting team helps clients capture and analyse vast amounts of electronic data during litigation, regulatory response and remediation and corporate investigations. His team has developed proven methodologies and several tools to analyse and review data held by clients. “Having the opportunity to help shape the way the SFO uses data and information and interfaces with business, government and the legal system will be both extremely interesting and challenging,” Haggerty said.

MATTHEW LIGHT ASKS ‘WHERE IS THE PERSONAL TOUCH’? GO TO ANY SALES TRAINING and one of the messages always delivered is ‘people buy off people’. The same personal relationship methods apply within the organisations themselves too. Most employees at some time have been on team building exercises, annual conferences and even the Christmas party – it is all seen as a chance to bring people together. Email, for all its merits, is not particularly personal. The risk of ambiguity and lack of emotion makes it a direct but impersonal audit trail of conversation or commitment. In my business our policy is to respond to an email with a phone call, and then reply to the original message. This method confirms receipt of the request, allows for some relationship building, removes any uncertainties and uses email to document the conversation. How different that experience would be if it was visual as well. How many times when you finally meet a colleague, customer or supplier say ‘it’s good to put a face to the voice’. Videoconferencing has been able to address this for years but mostly from the meeting room, or boardroom. Although personal conferencing solutions have existed going back more than 10 years, there aren’t many organisations that run ISDN to the desktop. Now there really are solutions that are cost effective and technically capable. They allow mass roll out across dispersed work forces and home workers. They are capable of high definition and work across ADSL, Wireless DSL, 3G as well as traditional leased lines. They transform a desktop or laptop computer into a personal conference device. As a real life example, we recently installed videoconferencing equipment in a US-owned European office and the site contact, after being employed for three years, met her manager based in the US for the first time. That’s personal. Matthew Light is the Managing Director of Tempura Communications Ltd. For more information go to www.tempurauk.net

www.cxo.eu.com

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FRONTLINE

RECRUIT YOUR TALENT FROM ONE PLATFORM TODAY, MOST MEDIUM AND LARGE SIZE ORGANISATIONS have formalised means of attracting talent and recruiting. These organisations exploit software to automate and streamline the recruiting and on boarding processes. Over the last decade, we have seen marked maturation in the software employed to recruit talent. Applicant Tracking Systems (ATS) help organisations recruit full time equivalents while Vendor Management Systems (VMS) enable organisations to recruit and manage their contractor talent pools. Whilst organisations benefit greatly from deploying both ATS and VMS, most are failing to capitalise on one stop shopping software that provides both ATS and VMS. As the war for talent progresses and organisations are forced to show more thought and discipline in the sourcing process, those that can do so quicker and with better access to information will prevail. There are three primary advantages of deploying systems that provide both ATS and VMS functionality:

MOST WORKERS ADMIT they’ll contact the ofﬁce whilst on holiday, with one in three taking their laptops with them. A survey by CREDANT Technologies into the growing trend found that paranoia on the part of employees and unrealistic demands from employers mean that people found it hard to switch off.

• CONSISTENT USER EXPERIENCE: Your managers shouldn’t have to learn one system to acquire full time talent and yet another to source temps and contractors. Your employees are deluged with internal and external programmes to learn. Keeping the ‘talent acquisition experience’ consistent and simple will lead to better adoption and usage. • TOTAL TALENT REPORTING: Your highest expense is more than likely compensation. Today, most organisations don’t have the ability to quickly and accurately obtain data on all of their labour pools. To be competitive in this economy, companies will need to be smart and nimble. Having access to information on every labour type (FTE, contractor, offshore, etc.) will prove invaluable in strategic workforce planning. • COST: Typically, working with a vendor that provides both ATS and VMS will result in lower total cost of ownership as you end up paying for one implementation and can enjoy greater bargaining power since the overall value of the deal will be higher.

WHILE THE PRICE OF STORAGE-RELATED HARDWARE HAS FALLEN, managing an organisation’s storage infrastructure is complex, time-consuming and, as a result, costly. A recent study by the Data Management Institute shows that administration stands for a staggering 80 percent of the total storage cost, with just 20 percent for hardware. With stored data increasing 60 percent annually (according to an IDC report), efficient storage management is a critical bottom line imperative. Conventional approaches to storage management requiring day-to-day manual oversight will continue to exact a steep if often hidden price, unless you can find a resource that can be entrusted to handle – indeed automate – a broad range of storage-related processes. Most storage management software performs adequately at the macro level, enabling administrators to monitor and manage storage capacity; but no piece of software, no matter how sophisticated its logic, can make value decisions for a user – without which, important data may be at risk. It’s all well and good to keep data within reasonable levels – and to filter out non-essential or ‘toxic’ data – but if users don’t have unfettered and on-demand access to the files they need to be productive, you’ve put your organisation at a disadvantage. The user-portal built into Northern Storage Suite gives IT departments the ability to manage storage on a global level, while giving users the tools they need to efficiently and responsibly manage their own storage. The portal coaxes more responsible user behaviour by making them more accountable for – and simply more aware of – their storage use. Northern’s ‘shared’ storage management is an entirely new model designed for today’s challenges; it is the simplest and surest way of maximising your existing storage infrastructure, while allowing you to plan and prepare for incremental investments over an extended time horizon – translating into significant cost savings, organisational efficiencies and overall productivity.

For more information go to www.beeline.com or contact Denise Miles, Director of Business Solutions at Beeline International, on 0207 429 5404 or email denise.miles@beelineintl.com

GLOBAL TECH HOTSPOTS: THE LIST

1. Silicon Valley 2. Bangalore 3. London 4. Tokyo 5. Boston

JUST RELAX AND UNWIND

www.cxo.eu.com

6. Cambridge 7. Shanghai 8. Tel Aviv 9. Seoul 10. Beijing

11. Chennai 12. Pune 13. Singapore 14. Helsinki 15. Moscow

16. Hong Kong 17. Hyderabad 18. New York 19. Sydney 20. Shenzhen

75% 65% 85%

reveal that they will check their emails once a day

confess that they will make contact with the office

admit to taking their mobile phone or BlackBerry on holiday

STORAGE SOLUTIONS REDUCING DATA HEADACHES

For more information go to www.northern.net or contact +46 8 457 50 00 or sales@northern.net

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FRONTLINE

THE IMPORTANCE OF DATA AND QUALITY DURING A RECESSION IN THE CURRENT ECONOMIC CLIMATE, the major question occupying the minds of CXOs will inevitably be, ‘how can we do more with the same, or less’? Marketing and customer service will be expected to demonstrate and prove their return on investment. In straightforward terms, businesses need to improve return on customer strategies, using quality information to deliver more targeted customer communications, resulting in improved customer retention and a greater ability to sustain and grow revenues. Extracting improved best value from marketing and customer service initiatives is largely a matter of data quality. On face value, this seems like a technical issue that should remain ﬁrmly in the hands of the CIO. In reality, nothing could be further from the truth. The analysis of data and customer spend patterns is now regarded by many businesses as a strategic asset rather than a ﬁnancial burden. Many organisations use the rich analysis of customer groups and their transactional behaviour – something that CRM and loyalty programmes enable – as critical management information. Address and postcode are frequently the common data piece across transactions, loyalty schemes, logistics, customer service, product warranty, lifestyle and geo-demographic data, order processing, call centre, campaign responses, and many other pieces of information that go to make up the 360 degree view of the customer. However, there are other validation and standardisation functions that are also important. Fuzzy matching techniques are used to recognise different versions of the same person’s name. Synonym databases help overcome the fact that different people use different words for the same thing. This is important when linking data to make customer communications consistent across different channels. Data also needs to be integrated into a single, common repository if the company’s various systems are to access it for analysis and to implement effective management, service, operational and marketing

TECHIES SHUN SOCIAL NETWORKING SITES TO BOOST CAREERS ONLY ONE THIRD OF TECHIES supplement job search tactics with social networking activity. In spite of the huge popularity of social and professional networking sites, nearly two thirds (62.5 percent) of IT professionals haven’t – as yet – used these channels to find an IT job, according to research carried out by The IT Job Board. It was

also revealed that more than half of those surveyed (57.4 percent) don’t currently see networking sites as being helpful to the development of their career. However, the survey did identify that half (51.2 percent) of the 62.5 percent of respondents who haven’t used social networking sites would not rule out using these channels in the future.

strategies. Formerly, pulling such information was cumbersome and expensive. That barrier no longer exists thanks to a software category called ‘extract, transform and load’ (ETL). In layman’s terms, this software allows non-technical people to build new data input filters on the fly, and inexpensively. Further data-based benefits can be achieved. In a tight economy, as many calls as possible need to be resolved in a single conversation, so that costs do not escalate. Single call resolution demands that the call centre system can access all sorts of data and documentation from across the enterprise (such as customer transactions, customer profile, customer service letters, bills, statements, and so on) to satisfy an enquiry straight away. This requires a flexible enterprise-wide data integration function. In these tight economic times, CXOs are looking urgently for process efficiencies and improved return on investment from their customer retention and development strategies. Not only marketing, but also management analysis, operational efficiency and corporate strategy development are reliant on high quality comprehensive customer data. Therefore it is a board level issue that such data is accurate, up-to-date, rich and accessible throughout a variety of corporate systems. To learn more on how Pitney Bowes Group 1 Software can assist you, visit www.g1.com or contact +44 (0) 1923 279 100

NEWSMAKER CONFECTIONARY MAKER NESTLÉ is enjoying the sweet taste of success after reporting an 8.8 percent increase in sales for the ﬁrst nine months of the year despite tough economic conditions. It seems the world’s love of chocolate has made the company virtually recession proof. Against a background of soaring food inﬂation the company was worth around €70 million when its CEO Paul Bulcke took over in April.

www.cxo.eu.com

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FRONTLINE IN MY VIEW Richard Brown, CEO of Eurostar, on the challenges of relocating from London’s Waterloo to St Pancras Station and the future of high speed rail travel in Europe. The first phase of Eurostar is just about our core markets: Brussels-London and Paris-London. For phase two Britain and Eurostar will be plugged into the extended European high-speed network. For instance, France and Spain will be joined up in the next few years with high speed, so you will be able to take the Eurostar from London to Paris and switch to TGV from Paris to Spain. It really does open up a much wider range of journey possibilities.

The issue of why Britain does not have a high-speed network when every other major European country is rapidly expanding theirs certainly needs resolving. Part of it is that we in Britain have had a lower level of investment in transport, particularly in rail, than a lot of other European countries. It’s also partly a matter of the political will required to commit to an initiative that could take 20 years to see through from initial concept to opening.

The biggest constraint on our capacity is passenger baggage screening. Waterloo just wasn’t set up to handle the huge amounts we’d like. At St Pancras, we basically use pretty much the same processes as the airline industry, which is unique. I think the Spanish have security on their high-speed trains because of the their experience of terrorism but we’re pretty unique amongst train companies in having that level of security.

Technically constructing the terminal at St Pancras was a really complex project. Obviously it’s really challenging driving a new line through a pretty densely urbanised area like London and the surrounding suburbs, so that project involved a lot of consultation and we were involved in that, naturally. We were also very closely involved in the final layout and design of the operation at St Pancras, in terms of advising on passenger flows and that type of thing.

Reconciling the need to provide a modern transport infrastructure within the setting of a historically significant building was a major challenge. The original St Pancras station is a historic building and is Grade One listed, so everything that happens there in terms of new construction, renovation or modernisation has to be approved by English Heritage.

The third part of the project was focused on taking our passengers with us and communicating the details of the move to over eight million of our customers. But in the end we only had five people turn up at Waterloo in the first week after we moved – a Japanese couple who didn’t speak very good English, and a family of three who had booked months before to go to Disney and didn’t read the newspapers. It was pretty amazing really.

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FRONTLINE CRM CAPABILITIES BASED ON BPMS USING DAD – DYNAMICALLY ACTIVATED DIVISIONS SINCE CRM IS A UNIVERSAL NEED for all enterprises and all its present difﬁculties that are widely accepted by enterprises are due to the lack of ﬂexibility and cumbersome operability in the CRM applications offered today, there is an evident evolution towards CRM built on processes from powerful BPMS. This provides the flexibility, tailoring power and ease of use which are demanded. This has opened a new and promising marketing door since the world of CRM is presently subject to controversy with defenders and attackers. This problem vanishes automatically when you use a CRM that is

built on processes and business rules that the business executives may change very easily (with no IT requirements) as many times as needed to adapt them to evolving market demands. All this is possible using DAD – Dynamically Activated Divisions. This innovative system converts a process task into a powerful workstation acting as a control centre with a dashboard capable of triggering an unlimited number of divisions so that many related activities can be carried out from the same process point, from the same task. This is a technological forward step that largely enhances the power of the BPMS making it capable of performing the most complex and critical operations of the enterprise in a very easy way. When opening a Task, its Form contains all ﬁelds and information required for the activity to be carried out by the user. There is no need for the user to leave the Task and look for information in other places.

JARGON BUSTER MICRO VIRUS A COMPUTER VIRUS that is embedded within word processing documents or spreadsheets that will activate when the file is opened. The effect can range from minor inconvenience to substantial corruption and is currently the most prolific form of virus.

For more information go to www.auraportal.com or contact Pablo Trilles, VP of Marketing and Sales at AuraPortal, on +34 962 954 497 or email info@auraportal.com

COMPANY INDEX Q4 2008 Companies in this issue are indexed to the first page of the article in which each is mentioned. 451 Group 98 ABB 144 Aberdeen Group 130 Absolute Software 8, 88, 89 Acronis 18, 96 Adeptic Technologies 6, 42, 43 Adobe 2,134, 135 Alcatel-Lucent 64, 65 Amazon 124 Apple 124 Argos 24 Ashridge 35 AuraPortal 23, 29, 112, 113 Barclaycard 24 Barnes and Noble 24 Beeline International 20, 143 Begbies Traynor 40 BG Bank 44 BlackRock 86 Borland 136, 137, 153 Bougues Telecom 54 British Airways 156 BSkyB 54 BT Diamond IP 58, 59, 121 Business Continuity Institute 104 Capital One 36 Cathay Pacific 156

CDC 124 Central Telecom 46, 49 CIO 82 Cisco 82 Citigroup 24 Citrix Online 78, 79, OBC Clydesdale Financial Services 24 CNN Money 82 Crypton Computers Ltd 62, 63, 71 Danske Bank 44 Dow Jones News Service 82 Escrow Europe 100 Etihad Airways 156 Financial Times 11,83 Finjan 88 Frost & Sullivan 82 Global Infoswift 106, 107 House of Fraser 24 HP 46, 49 82, 116, 117, 126, 127 HP ProCurve 84, 85, 131 IBM 18, 30, 139 IDC 77 Infoblox 61 Infor 124 InfoWorld 82 IT Week 82 Kalido 132, 133

Kepner-Tregoe Lufthansa Malaysia Airlines Merryl Lynch METRO Group Microsoft MyLaptopGPS National Irish Bank NatWest Network Rail Network World Newsgator Newsweek Nokia Nortel Northen Bank Northen Rock Northern NRX O2 Oracle Orange Ovum Parallels Pareto PayPal PC World

114 156 156 86 68 IFC, 30, 66, 124 88, 91 44 36 36 82 76 82 24 93 44 104 20, 103 128, 129 24 46, 47 54 60 122 114 94 82

Pitney Bowes Procession Providian Inc. RealKredit Denmark RIM ROK Group Sage Sama Dubai Sampo Bank SAP Seagate SmartCity Spring Partnerships TANDBERG Team Quest TECOM Tempura Thomas Cook Total UEFA USA Today Virgin Visa Vodafone Wall Street Journal

21, 125 46, 51 24 44 124 118 124 108 44 30, 124 4 108 148 80, 81 159 108 19, 74, 75, IBC 24 30 66 82 156 24 54 82

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COVER STORY

THE

MIDAS TOUCH

As one of the UK’s biggest lenders Barclaycard is at the sharp end of the credit crunch. But that hasn’t stopped it from investing millions of euros in contactless payment technology. Diana Milne meets CEO Antony Jenkins to find out why he predicts the death of plastic in a decade and how Barclaycard will weather the economic storm.

T may have been the first company to launch credit cards in the UK – but today Barclaycard is investing in technology that could ultimately lead their demise. Plastic will soon be a thing of the past according to Antony Jenkins, CEO of the company responsible for introducing UK customers to credit cards for the first time in 1966. The future, he says, lies in contactless payments and he has put his money where his mouth is by investing a seven-figure sum in the development of the technology. Barclaycard launched its combined Oyster travel and debit cards, OnePulse, in London last year and it has since issued over one million of the contactless cards. Earlier this year it teamed up with O2, Transport for London, Nokia and Visa to become the first credit card provider to trial mobile phone payments. It is also investing in biometric technology, which could make it possible for customers to make payments using their fingertips or via an iris scan. In fact, so confident is Jenkins in the future of contactless payments that he predicts that in a decade plastic credit cards could be extinct.

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“In many ways we could see plastic cards as the shortest lived payment mechanism in mankind’s history”

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“In many ways we could see plastic cards as the shortest lived payment mechanism in mankind’s history,” says Jenkins. “I think it’s always difﬁcult to be precise about timings but in the next 10 years could we see the death of plastic? Absolutely.” He says he believes that within the next two years, a mass roll out of mobile phone payments using NFC (Near Field Communication) technology will have taken place. Barclaycard’s pioneering six-month trial of the technology saw 500 customers receive O2 Wallet mobile handsets equipped with inbuilt Oyster cards for travel in London. Of the participants, 250 were provided with UK£200 to spend using their mobile phones. The pilot, which ended in May this year, was hailed a success with nine out of ten participants claiming they were happy using NFC technology on a mobile phone and 78 percent saying they would be happy using contactless services if these were available. “Everybody carries a mobile phone with them. I don’t get out of bed without a mobile phone let alone leave the house,” says Jenkins. “At the same time, everybody would like to have less to carry around with them so there’s a real convenience factor associated with being able to make payments using a mobile phone.” He goes on to say that further capabilities could be built into the phone such as the ability for cus-

A SHORT HISTORY OF BARCLAYCARD

1966 - 1967

■ Barclaycard launches the first all-purpose credit card in Europe. ■ Barclaycard becomes the first ATM card used in the UK.

1977

■ Company Barclaycard (now Barclaycard Business) is introduced. Barclaycard becomes a founder member of the international Visa system.

tomers to check their balances or find out information about the products they have purchased. “You can really let your imagination roam with this sort of technology. You could even get to the point where when you’ve bought your groceries at the supermarket the phone could keep track of the amount of calories you’ve purchased in total. I would expect that in the next two years we will begin to see more large scale roll outs of this kind of technology.” In comparison large scale deployments of payment methods using biometric technology are some way off, admits Jenkins, who says he believes it could be up to six years before customers are paying for groceries using their fingertips. He is confident however that the technology will be a success, referring to the fact that is it widely used in airports across the world. “Biometric technology is now at a stage where it is ready for mass deployment. I’m a huge fan of the technology they have at the airports where they have retina scanning instead of a passport. This technology presents real benefits to the customer – in terms of speed, convenience and security. I definitely think we will see adoption and I do think the technology is at a scalable level right now. But this is in more like a 24-month to 72-month time frame as opposed to the mobile payment technology which is more near term.” Key to the success of Barclaycard’s contactless payment innovations is a positive response by customers and merchants alike. And perhaps one of the biggest challenges it faces is creating confidence on both sides. “With any new technology like this you always have the chicken and the

1986

1990 -1999

2000

■ Barclaycard launches

■ Barclaycard

■ Barclaycard is

the UK’s first credit card loyalty scheme, Profile Points.

MasterCard launched.

launched in Italy.

■ Barclaycard is

■ Acquires the UK credit

launched in Germany.

card arm of Providian Inc, a top 10 credit card company in the US.

■ Becomes the first UK

credit card company to go on the internet with Barclaycard Net link. ■ Expands its European

operations to Spain and Greece.

www.cxo.eu.com

2001-2002

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egg situation,” says Jenkins. “Retailers will install terminals when there’s a of the UK’s largest lenders and the eighth largest credit issuers in the US – it is lot of customers using the technology and customers will use the technolat the sharp end of the credit crunch. ogy only when they see there are a lot of terminals.” He goes on to say that In the first half of last year the company’s profits fell 17 percent partly as a customers are “inherently conservative” when it comes to using new techresult of bad debt and it was forced to shut a Manchester-based call centre nology – an attitude that will prove the biggest obstacle to the widespread slashing over 600 jobs. Jenkins is under no illusions about how the worsening adoption of biometric payment methods. economic conditions will affect customers’ use of credit cards: “In the short So far however, retailers have been highly receptive to contactless payterm we would expect customers to be more cautious in their use of ment initiatives with “tens of thousands” of outlets acceptcredit cards and that’s appropriate – we would encourage ing OnePulse cards and partnerships between Barclaycard that,” he explains, adding that Barclaycard too has adoptand the likes of Argos and Thomas Cook. Barclaycard can also ed a more cautious approach to lending. “I think the eco“In the short leverage its existing base of 10 million retail customers counomic conditions require us and any provider in the term we would pled with its network of 96,000 merchants across the UK to market to act as responsible lenders. We’re very cautious expect customers speed up adoption of the technology: “We have a very large about who we extend credit to and we are mindful of our to be more customer base on the card side but we also have a very large responsibilities to help customers as they get into difficautious in their use of credit merchant acquiring business in the UK,” he says. “We have culties as some of them will in the current climate.” The cards and that’s about 96,000 merchants across the UK so putting together our situation makes it all the more imperative for Barclaycard appropriate” large merchant base and our large customer base we will be able to protect and grow its market share – with the introducto catalyse and kickstart the whole process.” tion of contactless payment technology, being a key eleJenkins is coy about just how much money Barclaycard has ment of its strategy. “We’re happy with our brand position. invested in technology that will ultimately kill off the plastic credit card – reWe’re happy about how customers perceive us, but of course we know vealing only that it is a “seven figure sum”. And while this strategy may seem a we have to earn that every day. We have to earn that through the new sharp departure from the company’s original raison d’etre, he insists this is a technologies that we roll out. We’d like customers to think of Barclaycard as logical step for Barclaycard. “If you look at the heritage of Barclaycard from its the best way to make payments.” establishment in the 1960s, it’s always been an innovative and market leading Staying one step ahead of the competition and fighting hard to win cusbrand. It’s in our DNA and we think this is the next wave.” There are also comtomers has become imperative to Barclaycard’s international expansion stratpelling market forces driving Barclaycard’s investment in contactless payment egy. The company operates across Europe, the US, Asia Pacific and Africa and technology. It now operates in a very different market from the one where it first to date the company has issued 8.8 million cards outside the UK and in 2006 launched credit cards in 1966. Competition for customers is tough and as one two thirds of its new cards were issued overseas.

2003

2004

2005

2006

■ Deal signed with

■ Acquires US credit card

■ Acquires the majority

■ In the US, Barclaycard

Manchester United, giving Barclaycard global rights to issue Manchester United branded credit cards.

firm Juniper Financial Corporation.

stake in ABSA Group Ltd in South Africa, through which it now has 1.9 million existing cardholders.

launches the Barnes and Noble Member MasterCard with the world’s largest bookseller.

■ Announces the

■ Reveals joint ventures

■ Launches Classic and

Gold Visa credit cards in Portugal.

■ Acquires Clydesdale

Financial Services.

■ Signs a joint venture

formation of EnterCard, a deal with the retailer House joint venture with Swedbank, one of the of Fraser, to issue leading banks in Sweden consumer finance and Norway, to provide products. credit cards across the Nordic region.

with Argos and Thomas Cook.

2007 ■ Starts issuing cards in India and the United Arab Emirates. ■ In the UK, Barclaycard

launches Barclaycard Breathe, a card that donates 50 percent of its profits to carbon reduction projects. ■ Launches Barclaycard

OnePulse, the UK’s first contactless payment card. ■ Begins trialing

contactless payments using mobile phones. www.cxo.eu.com

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THE DEATH OF PLASTIC?

Antony Jenkins on the future of plastic credit cards: “I would say that I do think the future of the plastic card is limited. Conceivably you could completely do away with plastic. If you think about what the card is, all it is is a mechanism for containing some pretty basic information, principally the customer’s account number. And that could be done in various different ways. “Companies now use cards a lot for travel and expenses but many have virtual cards in the corporate space today where there is no plastic. They simply use an account number to book travel and hotel accommodation. The pervasiveness of these kinds of payment methods is increasing but I’m sure though that we’ll still have cash and probably cheques long after plastic cards have gone because these technologies are better for the consumer in terms of the sort of payments they can make.”

Speaking about the European side of the business, Jenkins says: “We have a good set of European businesses. I am very happy with our German business where we are number two in the market and number one in the revolving credit market in Scandinavia. We’re the third largest credit card issuer in Sweden, the second largest in Norway and the sixth in Denmark. We also have businesses in France, Portugal, Italy and Spain. Obviously that growth will moderate in the current economic climate but as economies recover across Europe the growth will resume.” The company is well established in the US and last year it announced plans to issue credit cards for the first time in South Africa as well as in Dubai and India. “We would like to see Barclaycard becoming increasingly global over the next five years, building on the strong footprint we have.” He says he hopes that once adoption of contactless payment technology is underway in Europe, the technology will be become a valuable tool in its efforts to win global market share. “Our ability to transfer skills and expertise and some of the learning around the technology that we’ve discussed into those markets is a key factor in our success. I think Europe can lead the way with those types of technologies.” Jenkins claims the technology that has been developed so far is just the tip of the iceberg and that he has many more ideas for creating even more high-tech payment methods. For now though, his lips are sealed on what those technologies will be. “Of course we have a broad and deep innovation pipeline. We have some things that are just gleams in our eye at this point and I think I’m going to keep them as gleams in our eye.”

www.cxo.eu.com

Antony Jenkins started his role as CEO of Barclaycard in January 2006. He joined from Citigroup where he worked since 1989 in a number of roles based in London and New York. As General Manager and Executive Vice President, Citi Brands, he was responsible for most of Citi Cards with US$90 billion in receivables. His portfolio included Platinum, Universal Cards, Drivers Edge, Dividend, Diamond AAdvantage, Small Business, Premier Pass and College. Jenkins was educated at Oxford University and has a Masters in Philosophy, Politics and Economics. He also has an MBA from the Cranfield Institute of Technology. Barclays is where Jenkins started his financial career back in 1983, when he completed the Barclays Management Development Programme before going on to hold various roles in retail and corporate banking.

Auraportal.indd 1

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MISSION He controls a multibillion-euro IT budget and co-ordinates the activities of 96,000 employees worldwide. But for Patrick Héreng, CIO of Total, the biggest challenge is yet to come as the oil giant prepares to upgrade its entire IT infrastructure. He meets Diana Milne to discuss the task ahead and the threats his organisation faces from cyber criminals.

CRITICAL here is only one way for Patrick Héreng to convey the complexity of the operation he oversees, and that is through numbers. When I ask him at the start of our interview to give me some idea of the scale of Total’s IT systems, he sums it up with the following vital statistics: “The global IT budget ﬁrst of all is around €1.2 billion. The number of internal IT staff is around 2200. We are managing 1500 physical sites and nearly 80,000 workstations. We probably use more than 2000 terabytes a minute.” These numbers should come as no surprise. After all, as CIO of Total, Héreng manages the IT operations of one of the world’s largest oil and gas companies with activities in over 130 countries and 96,000 employees worldwide. But they are, nonetheless, mind-blowing – and set to become more so since the launch of Perspective 2008, a colossal project which will see the company replace its entire IT infrastructure, upgrading all components from workstations to network security.

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The scale of Total’s IT operation is due not only to the size of the “Usually we are located in the middle of nowhere and if we look company and its workforce but to the complexity of its oil and gas exat the infrastructure in those remote areas, there is nothing. Often ploration and refining activities, which rely heavily on technology for there is no telecommunications so we have to create telecoms links their success. To support these activities the company’s computing using different solutions, mainly satellite equipment. Sometimes we power expanded seventeen-fold in the past fi ve years – an increase deploy marine offshore optical fibres. That is one of the problems – which reflects the growing pressure on Total to source new oil supplies in a highly competitive global market. It uses highly complex technical computing methods such as digital oil field and geophysical analysis to source oil, and this year it become the global leader in scientific computing power after acquiring the high performance SGI Altix ICE+ computer from Silicon Graphics, which is capable of making 123 trillion calculations a second. “The most complex IT system is the technical computing that is used for E&P (exploration and production),” says Héreng. “An example of that is geophysical analysis such as reservoir modelling to find the oil and optimise the ways of producing it. Digital the limitations we face because of the platforms and because in a lot oil field is another complex IT system. We must find oil and to do that of the countries we can’t find the level of service needed in telecoms we are doubling our computing capability every year.” This system – for instance in Africa and Asia – and that means we have to manage creates enormous amounts of data and Héreng says the internally, locally, or we accept those limitations.” company has reached around 1200 terabytes of storage Given the scale of Total’s global activities, the c capacity for technical computcompany operates within a dec ing alone. Equally complex are centralised ‘federated’ structure the company’s supply chain and which means operations are logistics operations, which are managed at business unit level. supported with solutions from Total’s IT strategy and policies, SAP and Microsoft. however, are governed by a cenDescribing the scale of the tral IT department with separate operation, Héreng says: “We have IT departments within each complex IT systems for supply business unit. The information TOTAL IN NUMBERS chain, logistics and CRM as well as systems of each business unit for petrochemical, refining and mar- ketare supported by a common global ar• Fourth largest publicly-traded ing activities. These systems are mainly chitecture. This structure, says Héreng, integrated international oil and gas based on global SAP. There are now 11 creates its own challenges, particularly company in the world refineries in 10 countries and 10,000 when it comes to decision-making. • Second largest capitalisation on the service stations in Europe. That requires “It’s not so easy to make decisions Euronext Paris and the Euro zone: a complex information system, especially in this federated IT organisation because €136.1 billion on December 31, 2007 for the supply chain from the refinery to the decisions must be accepted by every • Operations in more than 130 countries the service station. And we have millions business unit. The current governance • Exploration and production operations of customers every day in the service stamodel is a mix between a decentralised in more than 40 countries tions so the CRM is complex there also,” organisation which reinforces the align• Producer of oil or gas in 30 countries he goes on to say. ment between IT and the business and the • Approximately 540,000 French While Total’s operations require the globalised architecture which optimises individual shareholders support of cutting edge IT solutions, the the cost of the information system.” • 2007 sales: €158.7 billion delivery of that technology is often comThe system will be put to the ultimate promised by the remote and often hostile test during the upgrading of Total’s IT inenvironmental conditions that it operates frastructure for Perspective 2008, which in. Total’s E&P activities span 40 countries, with production in 30 of aims to create uniform IT services across the organisation. The project those, including remote locations in Angola, the North Sea, Venezuela has been two years in the planning and so far the first phase – deploying and the Democratic Republic of Congo. telephony over IP for 2000 employees – has been completed. Héreng Héreng describes how he is often required to deploy IT solutions admits that the federated structure of the company’s IT operations crein an environment where no infrastructure to support the technology ated challenges during the planning stages of the project. exists, particularly on offshore oil platforms where establishing a tel“We have a federated organisation but now we must align the IT ecommunications network poses a major challenge. processes of everyone in the group. This means, for instance, that

“I have to face a paradox which is not simple to solve. We have to open the system but at the same time secure the system more”

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Patrick Héreng, 51, was appointed CIO of Total in 2006. He is a graduate of the French Institut Superieur de l’Electronique du Nord (ISEN), joining the Group in 1998 as Chief Information Officer for the refining and marketing division. He began his career with a computer manufacturer and then with an information and telecommunication consulting company, later becoming the CIO of a large French financial institution.

if we want to deliver the same level of services to E&P and to our specialised chemical subsidiaries, we have to align the way we support users and the way we operate servers. That’s one of the main challenges and we face a lot of resistance to change inside the IT departments. Add to this the fact that we have to co-ordinate the deployment across 130 countries and it’s a very challenging project.” He hopes however that Perspective 2008 will help to address some of these challenges by providing uniform IT services across Total’s global business units. The project includes the upgrading of employees’ workstations to facilitate better collaboration across the different departments using Microsoft Vista technology. “The goal is to deliver for everywhere the same level of services. We will deploy collaborative workstations and we will de-

liver to the users the tools to improve collaboration such as instant messaging from computer to computer and integration between the workstation and voice communication. “We will provide unified communications such as a unified email system and Web 2.0 capability to provide social networking capabilities to improve collaboration inside the organisation,” explains Héreng. But while facilitating better collaboration between Total’s employees will be a major benefit of Perspective 2008, it is not the project’s main aim. That, says Héreng, is to improve Total’s IT security. Protecting Total’s networks is one of the most challenging parts of Héreng’s job – particularly given the huge amounts of highly sensitive data it processes daily and the increased security threats faced by oil companies from international cyber criminals. This, he says, clashes with the organisation’s need to improve accessibility to its systems for remote Total employees and customers. “I have to face a paradox which is not simple to solve. We have to open the system but at the same time secure the system more. Because of the extended enterprise we have to link our information system to suppliers and customers for billing or procurement purposes. Our users also need to access the system from PDAs or non-Total workstations and they want to do that everywhere in the world, from Asia and Central Africa to the USA or France. At the same time, we have to secure the system. We are not as attacked as banks but there are risks. We have to protect our knowledge and our data and that’s the reason we increase continually the level of security in the information system. It’s the main reason we launched the Perspective 2008 programme – to be able to face the security threat in the future.” Perspective 2008 will see Total completely overhaul its security systems, extending its current perimeter limit security and integrating it throughout the system. “We will have embedded security inside the information system, inside the network,

“We have to protect our knowledge and our data”

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inside the LAN and inside the workstations and data centres,” says Héreng. “We will deploy a new ID management system which will allow us to have better management of the rights given to employees, contractors and partners accessing the information system.” He goes on to say that under the new system data will be classiﬁed according to the level of protection it requires rather than providing uniform security to all parts of the organisation. A variety of security solutions will be provided by several vendors, which will be integrated by IBM. Héreng is remarkably calm about the mammoth task that lies ahead of him, claiming he relishes the challenge of managing IT within what is probably one of the world’s most complex operations.

“We must find oil and to do that we are doubling our computing capability every year” “I enjoy my job although it’s quite complex. One of the major advantages is to be working for a global company. That’s one of the pleasures I have every day,” he says. I ask Héreng whether Total’s management places a high priority on IT. “No,” he replies. “The high priority for Total is to ﬁnd oil to renew the resource.” But with technology playing an increasingly crucial role in enabling oil companies to ﬁnd new oil sources and protect valuable data, Héreng’s role is pivotal to the success Total enjoys within a highly competitive global market.

TOTAL AT A GLANCE: With operations in more than 130 countries, Total engages in all aspects of the petroleum industry, including upstream operations (oil and gas exploration, development and production, LNG) and downstream operations (refining, marketing and the trading and shipping of crude oil and petroleum products). Total also produces base chemicals (petrochemicals and fertilisers) and chemicals for the industrial and consumer markets (rubber processing, adhesives, resins and electroplating). In addition, the company has interests in the coal mining and power generation sectors. Total is helping to secure the future of energy through its commitment to developing renewable energies, such as photovoltaic power and marine energy, and secondgeneration biofuels.

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TRANSPORT

TRACK STAR Modernising and maintaining the UK railways has been an uphill task for Network Rail since 2002, when it inherited a worn out infrastructure that had been starved of investment. Grappling with ageing legacy systems while rolling out new technologies to keep the IT strategy on the right track is the job of the company’s Director of Information Management Catherine Doran. It’s a daunting role, but she is determined to let nothing get in her way, as CXO’s Julian Rogers discovers.

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chatting with Doran, who is also a member of the executive management committee, that she is deeply passionate about the role IT plays and the headaches that it throws up everyday as she defines the strategic IT direction of the company. When Doran arrived, the business was at a stage where processes were being standardised across the country. The past 12 to 18 months have seen the company’s work come under scrutiny and its goal has become to transform Network Rail into a ‘best in class’ business with improved efficiency levels. As it transpires, it was the sheer scale of this mission of improving standards and grappling with the huge technology infrastructure that persuaded Doran to leave the financial services sector behind two-and-half years ago. “One of the real attractions of Network Rail was that it was very much a company on a journey and was in no way content to rest on its laurels. They don’t say ‘we have improved loads so now we will stop’. On the contrary, we were determined to do better and go further and transform the company and have a real impact on the industry – that presses all my buttons.”

Tackling complexities

Catherine Doran espite much of the 21,000 miles of rail network crisscrossing the UK being more than 150 years old, train passenger numbers have been steadily rising every year since the early 1990s. Letting the train take the strain seems to be the attitude of British commuters as they ditch the road for rail in increasing numbers. Although there is an ageing collection of track, signals, level crossings and stations under Network Rail’s control, it is all still heavily reliant on technology, which is where Catherine Doran and her information management team come in. This IT aﬁcionado, who has more than 30 years of industry experience under her belt, juggles a €230 million IT budget that supports Network Rail’s 33,000 employees, 17,000 of whom are maintenance workers out in the ﬁeld. Her department consists of around 650 permanent employees and 200 contractors. While modernisation is an important part of the job, like the technology leaders in most industries, preventing IT operations from coming off the rails is the name of the game, Doran admits. “The absolute number one task for the CIO is to ensure that the production and live systems that the company is dependent on are stable and performing; in other words, they don’t fall over and the users get decent response times.” Despite this simplistic view of the job, it is clear from

Since the privatisation of the rail network, train operators have devised their own technology strategies and implemented new systems alongside Network Rail’s. “It’s a very complex infrastructure,” Doran notes. Indeed, she recalls how she first had to get to grips with the “beast”, as she describes it, that is the firm’s extensive estate. “I had to understand what I inherited, the scale of the estate and how many users we have, as well as what the critical systems are. And of course, with the nature of the industry you get a variation in the level of criticality in the systems depending on the time of day. The other thing I did, and still do, is to work very closely with my counterparts in the business so that I have a real understanding of our priorities and strategies.” Doran says her department then builds the technology solutions that support major infrastructure projects and help deliver company-wide strategies. It seems that this pressure on the company is only going to intensify in the years to come as businesses and the public increasingly choose the train for their transport needs. “If you think about the future needs of the country and the demand growth both in passenger and freight, for more trains and more service, then that will translate into increased demands on the IT infrastructure as well.” She continues: “There is always work for us to do here because one of the things that we all know and understand is the serious underinvestment that existed in the railways for years, long before privatisation.” One of the challenges for Doran and her IM team has been wrestling with the “big old mainframe systems with green screens” at the heart of Network Rail’s IT infrastructure. They do have their plus points though. “One of the great things about these systems is that they are extremely stable. And they should be, having been around for more than 40 years.” Despite this reliability, these legacy systems are hampering progress somewhat as train use rises. “There will be increased demands on IT infrastructure as the demand for passenger and freight services increases. We are discussing with the ORR (Office for Rail Regulation) about the need to tackle legacy infrastructures because they are fundamentally becoming a blocker on how we move the whole system forward.”

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One aspect of the company’s efforts to move forward from a technology standpoint is what Doran dubs “intelligent infrastructure”. This is where all the points, signals and level crossings effectively alert Network Rail when there is a fault and send regular messages about their status. The company say this is about predicting faults before they occur. “If we can stop a fault then we can prevent a perturbation in the service, which means that people’s trains travel on time,” suggests Doran. However, she concedes that this project will be a big challenge over the next few years: “Conceptually, intelligent infrastructure is an easy thing to envisage but actually building degradation models for different assets and tracking this versus the actual degradation is going to take us a long time. This is one of our big pushes over the next ﬁ ve years.” It’s hoped that these selfmonitoring assets will improve reliability, safety and efﬁciency.

Always connected Another drive at Network Rail is for improved communications, especially when much of the company’s staff are so mobile. Earlier this year Network Rail teamed up with O2 to provide 23,000 staff with voice, BlackBerry and mobile data services. Doran says this is proving a real hit with staff. Network Rail also provides its maintenance and signalling staff with handheld devices for returning status reports back to HQ. In the past they would have had to write information down and go back and type it into the system. Not only do the handheld devices save time but they also dramatically reduce data

errors. “If you just enter information once, then you get greater accuracy.” Doran notes. She says Network Rail is introducing the handheld devices and O2 services “carefully” because it is a fundamental change to the way in which employees work. “We need to make sure that mobile technology is something that genuinely supports the business rather than being something that is forced upon staff.” Doran adds that any interruption to the services will affect employees because they become used to relying on certain technologies to go about their business. She says reliability is key and this ties in with her initial thoughts about a CIO needing to ensure that systems are “stable and performing”. During the discussion about employee mobility I notice that Doran herself seems to lack Network Rail management’s primary communication device – the ubiquitous BlackBerry. It turns out that at Network Rail it is frowned upon if you bring your BlackBerry to a meeting, in order to prevent interruptions and stop people succumbing to temptation and glancing at emails. “I don’t have mine here now because it would be impolite. I have my BlackBerry on in the evenings but I just look at it once or twice – it’s the same when I go on holiday.” Of course, there is an increasing pressure for executives and managers to be always ‘switched on’ at all hours of the day. As a boss, Doran is all too aware of the work/life balance. In fact, she actively discourages her employees from feeling the need to keep in contact with the ofﬁce when away from work. “There was a systems outage a few months ago and someone sent an email about the incident whilst on holiday. I told him that it was nice to hear from him but that he needed to go away and enjoy his holiday. Companies need to recognise the pressures that employees can be under and appreciate people’s leisure time. If there is a crisis then things are different but we don’t live in a perpetual state of crisis.”

The early days With an IT career stretching back to the Seventies, I was keen to discover more about Doran’s ﬁrst steps into the IT industry. After a

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little probing it transpires that her foray into this area of business was purely by chance. Doran recalls how she was all set to embark on a training course to be a maths teacher after completing her maths and geography university degree in Ireland. However, she spotted an advertisement for computer programmers and out of curiosity applied. “I didn’t know what computer programmers were so I thought I would apply for the job and ﬁnd out. I took an aptitude test, which I loved and thought was great fun, and when they offered me the job I took it. So by pure accident I got into IT.” After this serendipitous leap into the then embryonic IT arena, Doran has never looked back. Her CV includes stints as Director of Transformation and Technology at BT, European CIO for Capital One and Head of Retail Information Systems at National Westminster Bank. It must have been a big move making the switch to a completely different industry? “The hardest thing was the language or vocabulary,” she remarks. “Every sector has its own language and when I walked in I found we use so many acronyms. In fact, there are acronyms for acronyms.” To make sense of it all she took full advantage of the company’s jargon buster on the website. What seemed like gobbledegook to Doran a few years ago is now second nature. But whether it’s trains, banks or telecoms, Doran couldn’t think of a better area to be working in. “I love the work and feel sorry for anyone who doesn’t work in IT,” she announces proudly. “We get to see every facet of the business – we understand the HR stuff, we understand the ﬁnancial side, we understand what the marketers are trying to do, we understand the operational pressures and so on.” This holistic view of a company’s nuts and bolts doesn’t come without its negatives, however. “Working right across the business can be a dangerous place to be because everybody can tell you that it is your fault if anything goes wrong; sometimes it is, sometimes it isn’t,” Doran says with a wry smile. I am also interested to discover Doran’s thoughts on the male/ female imbalance that still exists in IT. After all, it is still fairly unusual to see a woman occupying a top IT job. That isn’t the case at Network Rail – of the seven leading people (including herself ) heading

up information management at Network Rail, three are women. But while it might seem that the male stranglehold on this arena is being eroded, Doran confirms with a hint of dismay in her voice that too many young women today perceive IT as not being a choice of career that offers creativity. “This view is really bonkers. They have the view that the people who work in IT are those who come along and repair your desktop or fiddle with the printer when it breaks down.” This blinkered view has applied to both sexes for decades, says Doran. “Thirty years ago, the IT department tended to be the backroom boys and it what they did wasn’t really understood. However, IT has moved on enormously and we all know that technology is a fundamental part of pretty much every business in every sector.” She admits though that the stereotypical image of bearded “geeks” tinkering with servers in a corner of the office still exists today. “There is this sense that IT is dominated by introverted propellerheads. In fact, the job requires a whole range of different skills and a very deep understanding of the company and its business strategy.” And when it comes to whether men or women make the best information managers at Network Rail, Doran’s opinion is clear cut: “I fundamentally believe it is about who has the skill set, who has

“I fundamentally believe it is about who has the competencies and who can lead the IT function - I don’t care whether they wear trousers or dresses”

79%

the competencies and who can lead the IT function – I don’t care whether they wear trousers or dresses.” With her determination to get the best people for her department and her love for IT, Doran certainly looks like she has Network Rail on the right track. The mission ahead is to keep improving with the help of technology and to cope with increased business and passenger numbers, which will be affected by that little known event called the Olympics in less than four years’ time.

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FINANCE

GOING FOR BROKE Business has never been busier for UK insolvency practice Begbies Traynor as the list of UK companies collapsing under the weight of financial pressures grows. CXO meets the firm’s Executive Chairman Ric Traynor to get the inside scoop on how many businesses are going under. 40

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here are few people who know more about the effects of the credit crunch on UK businesses than Ric Traynor. As Executive Chairman of one of the UK’s largest insolvency practices, Begbies Traynor, his speciality is the business of bankruptcy and in today’s economic climate there is plenty of business around. Begbies Traynor’s latest Red Flag Report, which monitors companies over a year old with assets over €11,766 paints a very gloomy picture of the UK economy, revealing that few businesses will emerge unscathed from the looming recession. According to the report, the number of distressed UK businesses more than doubled since the start of the year and 4566 companies faced critical problems, – i.e, county court judgements of over €5,970 or winding up period actions – in the third quarter of 2008, compared to only 791 in the same period last year. Meanwhile the number of companies with serious problems – those with a court action or poor or outdated accounts – doubled from January to the end of September 2008 to 58,564. But, says Traynor, the worst is yet to come: “Don’t be of the mindset that this is a bit of a blip and within 12 months we’ll be back in the good old days of 2007,” he warns. “We’re talking about four or five years until we see a decent amount of growth. In terms of recession, actually going backwards, you’re looking at all of next year and into 2010.Then there will be a period of flat or no growth. The first half of next year after Christmas up to the mid year will be the worst. There will be a lot of job losses.” The worst affected sector so far, he says, is the construction industry, as long-term contracts come to an end and new ones fail to materialise to take their place. Begbies Traynor’s report claims that 163 construction companies faced critical problems in the third quarter of 2007 and in the same period of 2008, 1055 companies faced critical problems – a 547 percent rise. “If you go back a year or so ago construction companies were working on specific contracts. What’s happened now of course is that there are no new ones,” says Traynor. “In the short to medium term, four to five years, the industry is going to struggle. You will see smaller companies collapsing, particularly in the current situation where there’s so little in the way of additional capital around.” He goes on to say, however, that in the long-term larger construction companies will survive the storm, provided that they take measures such as shrinking their workforces and sitting on existing landbanks. The full effects on the retail sector will be felt he warns, in the early part of 2009, when some brand names are expected to disappear from UK high streets completely. Only 48 companies faced critical problems in the third quarter of 2007 and 323 faced critical problems in the third quarter of 2008 – a 573 percent rise. “After Christmas, the cupboard will be bare and there’s every chance a lot of retailers will downsize and close unprofitable branches. There will be some well known chains that will disappear without a doubt,” says Traynor. While retail and the construction sectors are the most well-publicised casualties of the credit crunch, Traynor says no industry is now immune to the effects of the economic decline. He warns that traditionally ‘safe’ in-

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dustries are now also under threat – including IT. This, according to the Red Flag alert, was the worst hit of all UK industries in the third quarter of 2008 – the reason being, says Traynor, that it is catching up with other industries, having remained strong until recently. The third quarter of 2008 saw a 627 percent increase in IT companies with the most severe difficulties compared to the same period last year. In the second quarter of this year there was a 42 percent increase in the number of companies facing severe difficulties. “The IT industry has been pretty resilient to date because it learnt a lot from the dot.com bust, so it changed to a large extent from just Ric Traynor doing one-off assignments to having longer-term contracts that clients and customers were locked into,” says Traynor. “This would have made it a bit more resilient than perhaps it would have been. But it has now started to play a bit of catch-up.” He warns that IT companies could exacerbate the problems they are facing because they are in denial over the situation, so are slow to implement the necessary measures to protect themselves. “There’s evidence of many IT companies being in denial of a deterioration in trading and being slow to take cost cutting action. This only shores up problems for the future and may make them more vulnerable to acquisition by larger, more established IT players, further feeding the recent wave of IT industry consolidation.” Neither, says Traynor, are mining and other excavative industries safe. “If you’d asked me three months ago, I would have said IT has fared pretty well, and I would have mentioned some manufacturing and specialist engineering industries, mining and similar excavative industries. Now all of them are suffering.” Traynor advises that the best way for companies to protect themselves in this harsh economic climate is to plan well ahead, and this includes preparing for what to do in the worst-case scenario. “Plan properly, and don’t be a hostage to fortune. Sit down and think about what the future could be and where the funding will come from to run the business. Include in the plan a worst-case scenario. Think about how you would cope in that scenario.” He urges companies to plan early when it comes to what costs to cut – particularly when it comes to cutting jobs. “Start planning to get rid of those costs now even if you don’t do it right away, because there are lead times involved with people. Put everybody on notice in case you need to make them redundant.” As well as being open with members of staff about possible cutbacks, Traynor says companies should ensure that suppliers, their bank and business partners are kept well-informed of any developments facing the company. Attempting to conceal information about any problems the company is facing will only lead to greater problems further down the line, he warns. “What companies need to do is to be as open as possible with suppliers, bankers, customers and employees and just let them know what the posi-

tion is. Don’t give anybody any big shocks – that’s the worst thing you can do in this situation. Some companies keep quiet and hope that bad news will go away. It won’t. It just gets worst.” The result of not keeping banks and suppliers informed of ﬁnancial difﬁculties a company is facing is that they are likely to withdraw any support or terminate existing business relationships, warns Traynor. He says: “In this economic situation, if you give people shocks, there’s likely to be a knee jerk reaction from them whereby people try to grab their money back or their stock back or freeze the overdraft and put you into some kind of insolvency procedure.” One of the toughest challenges businesses will face is actually securing finance - either to expand their business, pay suppliers or pay off debts. In the absence of freely available bank loans, companies will have to rely for help on third party financing or even bailouts from the personal savings of the company directors themselves. Traynor says, “Going to your bank for more borrowing is a nonstarter, unless you’re a very large customer and the bank is into you for so much that it doesn’t have a choice. You’re almost certainly going to be looking at third party finance. For most companies you’re looking at things like directors’ personal savings. Directors may be able remortgage their homes or use their pension funds to invest in their own business.” He warns company directors to think carefully before taking such a step, however: “These measures should be taken in conjunction with good advice,” he says. “The last thing a director should be doing is throwing potentially good money after bad. If the business isn’t viable anymore then it should be dealt with appropriately.” While Traynor advises companies to approach the current economic conditions as if they are permanent, he describes the situation as a “natural shake-up” which will result in positive growth over the long term. In the meantime, businesses caught in the eye of the economic storm should take preventative measures now to ensure they don’t end up as a statistic in Begbies Traynor’s Red Flag Alert report.

“Going to your bank for more borrowing is a non-starter, unless you’re a very large customer”

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EXECUTIVE INTERVIEW

Information at your fingertips All too often organisations struggle to manage siloed and disjointed data. Jimmy Afshar explains how enterprise search solutions provide staff with a holistic overview of business-critical information.

CXO. Why is up-to-date information search technology so vital for businesses today? Jimmy Afshar. The average amount of data produced is increasing rapidly. Data may reside anywhere from employee workstations’ local disks to shared ﬁle servers, email servers, database servers, archives, and internet or intranet web sites. As the data volume grows the need for a coherent enterprise search solution becomes more evident. Real value is delivered only if the implemented search solution returns fast, reliable, complete and up-to-date information without introducing considerable administrative overheads or large support and maintenance fees. CXO. What are the major issues with enterprise search today? JA. Most companies lack a cohesive enterprise search strategy, resulting in simple suboptimal solutions or complex and fragmented solutions with overlapping functionality. It is not uncommon for business-critical applications to use simple search tools with poor performance or to utilise a mix of different technologies either in-house or expensive third party products that signiﬁcantly increase the cost of support and maintenance. A typical scenario is to mimic internet search engines by using a crawler to index structured data. Using a crawler to index internal structured data adds complexity and

inefficiency to local networks. Besides, in most cases the solution would not include a full implementation of companies’ enterprise search rules. CXO. What are the main benefits of the Adeptic Enterprise Search Suite (AESS)? JA. Our customers say, ‘We’ve got what we expected, an ultra fast free-text search engine, which gives the right answers to our queries’. The integration and configuration is made easy so there is no need for costly projects involving a troop of consultants trying to trim, tune or integrate an already expensive product which is even more costly and risky. Besides, it is really easy for our client’s technical resources to add new data sources, tune or configure AESS if desired. We also offer a rapid proof of concept with minimal resources. We can be really concrete, i.e., we can show the power of AESS by presenting a proof of concept based on real data. It is then easy to compare AESS with existing or competing solutions.

CXO. How is the Adeptic Enterprise Search Suite designed to meet the needs of corporate intranet, internet or eBusiness search solutions? JA. AESS offers a robust platform guaranteeing optimum performance while maintaining easy integration and administration. AESS contains an ultra speed indexing engine, the fastest on the market given today’s available software and hardware technologies. AESS employs a state-of-the-art fuzzy search algorithm with remarkable fault tolerance and search speed. The fault tolerance sensitivity can be adjusted to the desired level depending on the application using the search function. AESS is an enterprise search solution able to index different types of data residing in different data sources. AESS supports multi-channel solutions where search results, authorisation and security levels and company search rules might differ between different channels. CXO. How will Adeptic’s search technology be developed in the future? JA. Adeptic has recently developed advanced statistical modules to predict and suggest search results based on other users’ behaviours and search patterns. AESS can be configured to automatically sort down relevant items that are statistically rarely chosen. The ranking of items in a search result becomes simply dynamic and will change depending on search statistics, user behaviour and predefined ranking and sorting priorities. Combined together with a powerful fuzzy search algorithm and predefined search rules, an attractive search tool is created. Our development activities will include working together with data mining and business intelligence solution providers requiring high performance and customisable search solutions to deliver new AESS modules in the near future.

Jimmy Afshar is the CEO of Adeptic Technologies, the leading enterprise search solution provider in Scandinavia. Afshar has advised various organisations on a broad range of topics within information search, management and information technology solutions. He is responsible for the development of key strategies in enterprise search within international markets. Please contact him on: +46 735 33 8279 or by email at: jimmy.afshar@adeptic.net

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BANKING

Having masterminded a series of high profile mergers Peter Schleidt, CIO of Danske Bank, claims to have developed the ideal formula for bringing financial giants together. He tells CXO the secret to achieving the perfect merger.

ank mergers may currently dominate European business usernames and passwords. Every single system that they signed into headlines – but for Peter Schleidt they are all in a day’s work. was new.” The CIO of Danske Bank has overseen some of the contiThe speed with which Danske Bank is able to carry out these processes nent’s most complex bank mergers, successis due to its One Platform strategy. This sees the bank deploy fully integrating the IT systems of banks the same IT infrastructure, processes and systems within the across Northern Europe. Danske Bank’s acquisition spree whole organisation, including within the banks that it achas seen it snap up Finland’s Sampo Bank, National Irish quires. “Our business vision is called One Platform. We are Bank and Northern Bank, RealKredit Danmark and BG now operating in retail banking in the Nordic countries: Bank within the past seven years. It currently serves over Denmark, Sweden, Norway and Finland, the Baltics and five million retail customers throughout Europe and emNorthern Ireland. The interesting thing is it is all based on one The proportion of Danske ploys 24,000 staff. platform. It’s the same products and the same process and Bank loan agreements to be The mergers mean major logistical challenges for systems. This creates one banking model,” says Schleidt. signed electronically in three years Schleidt and his team who must integrate the acquired Describing the advantages of this system, he says: bank’s existing IT systems with their own. Describing one “One of the big beneﬁts is that there’s a lot of cost synersuch example, he recalls: “A year after we took over National Irish Bank, gies. It can be difficult to justify cross-border mergers but by having this our employees went home for Easter vacation and when they came back, approach we can take out around 20 percent of the costs.” He adds: everything was changed. They had new PCs, they had to sign in with new “When we buy a bank and integrate it then run it on our existing systems

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there is only a marginal cost to run that new bank.” He admits however that migrating an acquired bank onto Danske Bank’s platform can be particularly complex when the new bank is in a different country and includes applications particular to that country. “It has to be carefully planned because even though it’s using the same systems they have to be adapted to the specific market i.e language and country specific regulatory issues,” says Schleidt. “There are some things that are different from market to market and they have to be developed on our platforms for supporting new markets. In Ireland for instance, I think it was ISA savings accounts with tax benefits and that sort of thing that was different.” He admits that some of the integration projects have gone better than others. “The integration projects of National Irish Bank and Northern Bank were chosen as projects of the year in Ireland and the UK, while there were a lot of issues and bad press in the initial period after the Sampo migration but we came through that.” He adds however that merging with or acquiring a bank with very different systems to its own can provide Danske Bank with some valuable insight into new banking methods or innovations. Describing what it learnt through the acquisition of Finland’s Sampo Bank, Schleidt, says: “Finland is the land of Nokia and they (Sampo Bank) are very advanced in terms of internet and mobile with a lot of very good solutions that we did not have. We had to develop those solutions before integrating them and now all the other customers of our brands beneﬁt from that. They brought in a lot of new, fresh ideas on how we should develop our business.” For now Danske Bank has restricted itself to window shopping and using this period of relative calm to strengthen its existing banking platform and consolidate its operations. “Currently we’re not in any [acquisition] process because of the markets and also because we have acquired quite a few banks and need to consolidate for a period of time. “So we’re further developing our platform to be more competitive and more cost effective. We can do quite a lot more to be more effective than we currently are.” As well as building on its existing IT platform the company is currently engaged in a project that would allow customers’ loan applications to be processed online. Schleidt says the aim is for around 95 percent of loan agreements between customers and the banks to be signed electronically within the next three years. It’s a big ambition, given that, according to Schleidt, 95 percent of new loan agreements are currently done on paper and processed manually. Even more ambitious is the bank’s plan to allow customers to receive real time credit from the bank via their mobile phones. “It’s our ambition to fully automate the back ofﬁce processes for mass products,” says Schleidt. “That way somebody could be out shopping and see some expensive furniture they would like to buy. They would send us an application on their mobile phone and we would make an automatic credit decision to

grant them the money. An electric agreement would be sent to the customer’s phone, which they would sign digitally and then in real time you have the money in your account.” Schleidt goes on to say the bank hopes to be able to offer this service to customers by 2010. He says he is quite confident that economic conditions in Europe will not curb a high investment level in IT projects by Danske Bank and that if large development projects were to be stopped or put on hold, the bank would be in a worse situation. “My advice to our banks and other banks is that if you stop developing totally that’s the only way for certain that you will be out of business at a later point in time, unless you start developing with added pace, at a later stage of course.” While keen to continue investing in IT, Danske Bank has made its IT operations more cost effective by outsourcing its IT operations and basic operating systems. A big share of its software developers are based in an outsourced development department in Bangalore and Schleidt says the bank plans to continue increasing the number of its developers based in India because of the success of the move so far. “Having taken them on they are using our development tools, our development model and we take full responsibility for what they are doing. “We currently have close to 400 developers in Bangalore and 1600 locally.” Ensuring that the bank is run in a cost effective way is a key priority for Schleidt going forwards, he says. “In the short term, with the ﬁnancial crisis, it’s about making sure that we can get all the beneﬁts in terms of cost reduction from the current project portfolio. “It’s very much about ensuring that we get value out of the investments we are making in IT.” He praises the management of Danske Bank for treating IT as a valuable investment for the company and one that helps it to meet business objectives – rather than an unnecessary expense. “The good thing about our executive board is that they don’t see IT as a cost. They see it as an investment and that’s also how we treat new projects. It’s very much based on whether we can prove a strong investment case with net present value. If the net present value is high enough then we get the money [to invest in IT projects],” he goes on to say. The fact that the company views IT as a way to meet its business objectives means Schleidt’s job is very much about ensuring there is close collaboration between the two departments. “The job is actually much more about bridging the gap between IT and business,” he says. “I’m sort of the manager of business development but then also the person in the management of the bank who knows how to handle the development initiatives.” And he says that this side of his role is increasingly IT takes its place as one of the driving forces behind the bank’s success. “I don’t know if IT is the brain or the heart of the bank but it is a certainty that if it doesn’t work, then the bank doesn’t work” he said.

“In the short term, with the financial crisis, it’s about making sure that we can get all the benefits in terms of cost reduction from the current project portfolio”

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ROUNDTABLE

An architect of

success Service-orientated architecture (SOA) is in use across most key verticals such as telecoms, financial services and government. But what are the key steps needed for its integration and where is SOA heading in the near future? For a better perspective, CXO speaks to Central Telecom’s Lynne Austin, Procession’s David Chassels, HP’s Manuel Rubio and Oracle’s Dr Andrew Sutherland.

THE PANEL Dr Andrew Sutherland, SVP of Oracle Emea Technology, develops business strategies and manages competence in middleware. Dr Sutherland has over 20 years’ experience in emerging technologies and their application to business problems. David Chassels is the Chief Executive Officer of Procession plc. He has written a number of papers about the importance of technology aligning people and their processes, which have been published in various journals. Manuel Rubio is Business Development Manager of ServiceOriented Architecture (SOA) in the Technology Solutions Group at HP. He is responsible for the EMEA business development of SOA. Lynne Austin, Business Development Manager for Central Telecom Ltd, is responsible for leading the company’s strategic account relationships and expanding its managed services.

CXO. A key beneﬁt of SOA is interoperatibility. How can integrated, streamlined IT systems help companies grow and improve their bottom line and gain a competitive advantage? Lynne Austin. Although SOA principles and capabilities have been around for many years, many large corporations have implemented large applications be they CRM, billing systems, HR or accountancy systems without using the SOA approach. The implementation of these applications have signiﬁcantly grown increased over time and maintenance and development costs escalated higher then any IT department or supplier had ever imagined, communicated or delivered due to complexity of change and bespoke developments. Also over the years, such systems have gone through so many changes and are so tailored it is nearly impossible to integrate new products and applications to improve business deliveries.

Many companies now realise the importance of ‘off the shelf’ applications and in using SOA, such that IT becomes an enabler to business delivery and not a millstone. Implementation of IT architectures and applications using SOA allows configuration and content changes to be easily implemented and, if possible, by business not IT professionals. We are still some way away from this mindset but significant change is now occurring within IT departments. Middle and senior managers with business skills and awareness are being recruited, ensuring they understand the need for this level of agility. Manuel Rubio. Businesses across the globe continue to struggle under increasing pressure to become more agile. Agility is the term to describe how rapidly a business can respond to first, take advantage of a new opportunity or change in market dynamic or second, respond to an external threat such as a new competitive offer, a consolidation activity, a pending compliance requirement or a macroeconomic factor that threatens the health and stability of the business. As more and more business is conducted digitally, IT organisations across the board are straining under the weight of ‘accidental architecture’. IT finds many of their resources locked up in monolithic, proprietary data and application silos that require armies of integration engineers to expose and connect. SOA promises a new, more agile approach to delivering new and evolved business functionality by composing business capability from loosely-coupled shared services exposed by interoperable, standardsbased and well-described interfaces. As an IT organisation successfully evolves its architecture to be SOA-based, more and more of their needed capabilities become easily re-useable, shared services rather than proprietary, hard-wired application and integration projects. This translates into being able to respond to new business demands. David Chassels. The first point to make is that there are two ways to deploy SOA as a new IT architecture and the contained use of it as ‘SOA in a box’. The former will be a long journey for large companies as the architecture enabling capabilities that can be shared across lines of business to deliver greater flexibility from business applications. The

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‘SOA in a box’ is a simpler use of SOA principles with a focus on supporting people in their daily work. People are the source of all information and in reality there are relatively few work task types, human and system that can address any business issue. By creating these as configurable services in a data centric environment you create a highly flexible ‘SOA in a box’ to ensure constant improvement and competitive advantage where it matters with people. Andrew Sutherland. Today, organisations of all types face one common and persistent challenge: how to become – and remain – agile while staying ahead of the competition. The solution is business integration. Combining business process management (BPM) and a service-oriented approach to IT management, business integration promotes efficiency and automation across all processes, ensuring that existing IT assets support actual business processes and new IT investment is focused on maximum return. Today’s SOA-based approach which puts business and IT on an equal footing, eases this integration. By combining a SOA strategy with BPM, organisations can ensure a graceful, gradual, and successful transition towards complete business integration.

thinking that they will realise agility beneﬁts simply by turning their application functionality into a bunch of web services or buying an Enterprise Service Bus or other SOA platform technology. This is a common scenario that we see play out again and again. This will not realise the ROI of agility as these companies will still require massive integration resources (this time trained in the ESB or WS technologies) to make changes. This will still result in duplicative functionality as services will not be discoverable, trusted and shareable. It will also result in service domain silos that may or may not map to the most critical needs of the business.

Manuel Rubio

CXO. Do you believe most companies realise the benefits? What sort of ROI is there? LA. No. Larger corporations will have no choice but to adopt this revised SOA approach. The debate on the ROI model will be one around detaching legacy and moving to this new model. A key question will always be how much of the multi-million euro CRM, Billing, HR application delivered five years ago can be written off, replaced or amended with an SOA architecture versus the cost of not doing this and your key competitors being first to market with new products and services. Few enterprises fully understand the business context in which their communications occur yet real time communications are the key to the normal operations of many processes becoming critical when exception or crisis events require rapid response and quick decisions. Central Telecom, because of its unique market position, can integrate real communications such as Communications Enabled Business Process (CEBP) to automate specific business processes within the production and productivity stream of a business to increase revenues, customer satisfaction, faster response rates, lower operational costs and higher returns on technology investments. MR. This is an interesting question as it implies that companies who desire to implement SOA actually succeed in implementing the intent of SOA rather than just developing and exposing services. The trap that many companies fall into as they embark on their SOA journey is

DC. The key end game promoted for SOA adoption is ﬂexibility to change applications as required by the business. A simple must have, but yet to be widely demonstrable. Adopting the ‘SOA in a box’ delivers this quickly and elegantly where it matters with people. For SOA there is concern at business level on ROI as evidenced by recent industry analysts indicating a drop in adoption. As recession bites SOA may be nice to have but ROI criteria has changed to favour basically quick wins and this may be a challenge for SOA. On the other hand, ‘SOA in a box’ has a different proﬁle where ROI can be tangible very quickly and with resultant automation can result in real savings with in the year.

“We expect to see greater integration of SOA technologies and solutions with the rest of IT from a governance, integration quality and ‘ongoing’ management perspective”

AS. Yes. Companies using SOA are now better able to quantify the benefits they achieve. The two main benefits are a reduction in operating costs and increased agility to accommodate the demands from the business in appropriate timescales. Companies can increase their reuse of business services and at the same time reduce the amount of costly integration. The trick is to select and prioritise a number of projects from which the reusable assets can be built and harvested. Each project should deliver something back to the business in terms of a benefit for a future project. In this way we can start to build and measure an ROI by capturing the actual development days required in the build.

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“Implementation of IT architectures and applications using SOA allows configuration and content changes to be easily implemented and, if possible, by business not IT professionals” Lynne Austin

CXO. What is the biggest misconception about application integration and SOA in the marketplace? LA. One of the biggest misconceptions is that web standards and Java alone will resolve system integration issues. Although these standards have come a long way in improving system integration and application flows it will not resolve information exchange between applications. What SOA does not do without taking a further step is to integrate communications and collaborative capabilities. However, because of the way that SOA works, if automated communications software is a feature of the SOA environment and available as a set of web services then business processes can be designed to take advantage of it. MR. We believe that the biggest misconception around app integration and SOA is that they are essentially the same. SOA represents a better way to do application integration and once you have installed and enabled IT with a SOA-based app integration-software product–think ESB–that you are done. SOA is much more than integration and while an SOA approach can greatly simplify the process of integrating applications, it is only simplified when all the other key aspects of adopting SOA are embraced. It’s only by embracing a service approach, aligning business and IT behind the concept of building out shared business services, enabling the service lifecycle with governance and management and aligning the IT silos which contribute to the successful realisation of a service lifecycle, including the enterprise architecture teams, service providers, consumers, QA and testing teams and on-going operations, that the type of agility and simplification of integration be achieved. Certainly, integration technologies that are designed for a SOA approach help as well but only in the overall context of embracing SOA across the IT organisations and SOA domains. DC. We have no view because there are no misconceptions.

side threats have traditionally deterred investment in SOA. However, the risks are not insurmountable. To provide IT security for SOA requires an end-to-end identity management capability that can determine access rights for every application involved, preferably a fully integrated stack of the requisite technology required to enable all of the necessary identity & access management (I&AM) capabilities. CXO. New systems often require re-training of staff – what new skills are needed

to manage SOA? LA. SOA requires a change in the way IT departments behave from managers and developers through to architects. Although there are many books, and training courses around WEB, Java and VXML environments, and developers are plentiful within the current market, staff require training on business processes, project-oriented development and business requirements and analysis. This approach will ensure a more focused business lead IT organisation which is aligned to the challenge and goals of the business. MR. This is a broad question and an important one. SOA impacts all aspects of IT as it necessitates new processes across the service lifecycle. First of all, it introduces new roles – the role of service provider and service consumer as well as the need for an empowered architecture team or Center of Excellence who are the stewards of the successful transformation to the SOA approach and who drive the consistency and control required for successful deployment across domains and the enterprise. For a best reﬂection of the new skills required to manage a SOA, refer to the HP SOA domain model. DC. There does appear to be a skills shortage to install SOA and this is one of the causes for the fall in adoption as mentioned. SOA skills to deliver SOA remain very much with IT. However the ‘SOA in a box’ is quite different as the core business code never changes and can deliver on any business issue led by the business analyst working direct with

“At Oracle we believe that EDA (Event Driven Architecture) is the next step in SOA’s evolution” Dr Andrew Sutherland

AS. The perceived risks associated with exposing a company’s IT systems to out-

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In Recession Use Procession New Business Technology Puts people back in control Satisfy the regulators where information is created Proven robust Quick wins Low TCO Build custom applications led by the business direct from the business model with no code generation or compiling Future proof – change as required with no disruption. “And there’s been this holy grail of development forever, which is that you shouldn’t have to write so much code,” “We’re investing very heavily to say that customization of applications, the dream, the quest, we call it, should take a tenth as much code as it takes today.” “You should be able to do things on a declarative basis” Bill Gates Microsoft’s 2008 Ofﬁce System Developers Conference

TOO LATE - PROCESSION HAS HAD FOR 10 YEARS (and they can’t Patent it!) Procession plc, 1a Stones Courtyard, Chesham Bucks HP5 1DE England Telephone +44(0)1494 781444 - www.procession.com

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the business. Business analysts will become more productive and in a more satisfying role which should attract a wide range of business experience including business savvy technical people. AS. Achieving beneﬁt from SOA is contingent upon the ability to effectively manage the SOA environment across the enterprise. The purpose of SOA governance is to regulate and manage reusable assets, preventing proliferation and misuse. A successful SOA governance framework requires the right mix of people, proceses, and technology. The formula for that mix begins with a clear understanding of governance goals, and how they are to be achieved. Oracle’s SOA governance framework offers a structured approach to implementing this vital aspect. CXO. How do you see SOA evolving over the next few years? LA. Alignment around business to IT development techniques, with a ‘can do’ attitude and realistic time deliveries. Avaya CommunicationsEnabled Business Process (CEBP) can be seen as the next stage in the evolution of business applications, building on and integrating with the advances of SOA and Event Driven Architecture (EDA) to enable the design of the whole business process. The long-term opportunity for CEBP has the potential to become a driving force in the continuous improvement of the organisation. Ultimately, the end vision is a comprehensive multi-channel communication access architecture that increases business agility through rapid, intelligent responses to business events that ﬁnds and connects the right people, at the right time, with the right devices. This integration will enable businesses to keep their decision-making processes moving towards resolution, whether for application-to-application tasks, humanto-application, or application-to-human communications related tasks. MR. Customers who are successfully building out their SOA and creating business-driven capabilities using a SOA approach, which are returning measureable ROI, will see their SOA efforts grow from project to multi-domain and eventually enterprise. We expect to see greater integration of SOA technologies and solutions with the rest of IT from a governance, integration, quality and ongoing management perspective. We also see SOA supporting and adding a level of enterprise quality of service and governance to web-oriented applications and mash-ups. In addition, as we look out

over the next few years at the growing interest in and acceptance of software-as-a-service and cloud models, we see that SOA can be an enabler of such service providers and cloud providers. We expect to see SOA implemented in the cloud and by SaaS providers to make it easier to bring onboard new service consumers, manage change, quickly provision out new service capabilities and manage business contractual expectations. DC. I think SOA as a concept for an improved architecture will slowly be adopted but will provide more tangible beneﬁt to the large organisations trying to sort out a mess of legacy systems. On the other hand the relatively new ‘SOA in a box’ is a simpler yet powerful approach that already has all the application requirements embedded into its contained environment. I see the SOA principles will have an important role in supporting Value Networks recognising the need to focus where value is created and this requires people supporting applications that are ﬂexible.

“SOA as a concept for an improved architecture will slowly be adopted but will provide more tangible benefit to the large organisations trying to sort out a mess of legacy systems” David Chassels

AS. At Oracle we believe that EDA (EventDriven Architecture) is the next step in SOA’s evolution. The challenge is that the more applications and services a business has, the higher the complexity of integrating services in a unified, cohesive manner – particularly around a specific event or service. Therefore, it is crucial that companies realise the importance of an EDA and its ability to capture, process, analyse and manage events in real-time. Once they do, they will have the ability to dynamically configure their systems, processes and applications towards a more efficient and agile business model. SOA provides a software architecture that delivers business agility by automating the process of pooling together all systems, applications and services. Event-Driven Architecture takes this a step further. It provides a style of application architecture centred on an asynchronous ‘push’-based communication model. It is currently the primary option for implementing ‘straight through’ multi-stage business processes that deliver goods, services and information with minimum delay. Without an SOA, an EDA would not be possible. Building applications and systems around an event-driven architecture allows these applications and systems to be constructed in a manner that facilitates more responsiveness, since event-driven systems are, by design, better suited to unpredictable and asynchronous environments.

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Unified Communications can help your organisation to work more intelligently, driving cost savings through technical efficiency, allowing your business to improve customer service, make faster decisions and quickly locate relevant people and information. Unified Communications empowers staff by freeing them from a complexity of technology, allowing them to concentrate on why they are communicating. By allowing people to work from anywhere at any time, sharing the same information as their office colleagues, organisations can maximise their skills and enhance both employee and customer satisfaction.

| 0870 606 7720 | www.central-telecom.co.uk |

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Believing in better CXO’s Joaquím Schmidt meets British Sky Broadcasting’s Chief Technology Officer Didier Lebrat to learn how technology forms the backbone of the media giant’s operations. ith its pay-TV, home telephony and broadband services, Sky is on a three-pronged charge to offer its customers the very best entertainment and home communications products and services in the UK. And with this multibillion-euro company so heavily reliant upon technology, it is little wonder that the decision was taken to create the role of Chief Technology Officer two years ago. Frenchman Didier Lebrat, previously CTO of Vodafone Italy, was appointed to drive growth through technology and deliver new products and services for the company’s nine million customers. In fact, there isn’t a single aspect of the company’s technology operations that doesn’t come under his watchful eye. Since his arrival the company has focused hard on making its technology investments work for its customers. “Everything we do is about improving customer experience and making sure we are ahead of the competition,” says Lebrat. “My role is to make sure that we organise the technology function in a way that is going to deliver the business strategy and so there is a need to be fluent in our business activities.” Lebrat, who heads up a team of 1500 technology staff and 500 contractors is a firm believer in technology leaders being in tune with his or her company’s corporate vision and the direction it’s heading in. This is re-enforced by an increasing

number of techies being set free from the ‘back ofﬁce’ and elevated to the C-suite in recent years as IT becomes intrinsically intertwined with business processes and operations. It seems that being business savvy is part and parcel of the role of CIO and CTO. “For me, it is absolutely key to understand the business strategy with the rest of executive team and work out where we are going; then turn that into technology,” Lebrat explains. “Likewise, it is totally pointless to come up with great technology solutions if they don’t meet the needs of the customer.” He adds: “We are very proud of our successful tradition for groundbreaking products but I am also very keen to make sure that we do not innovate just for the sake of it. The risk in a technology organisation is to go for the next big thing and end up with bits of exciting technology that are not really relevant for your business at this point in time.” Lebrat suggests that any new technology Sky rolls out needs to be supported by a proper business case – be it for the short or medium term.

Hands full Coinciding with CXO’s meeting with Lebrat is a particularly busy period as he orchestrates a number of technology projects for the beneﬁt of the company and its customers. On the broadcast side, an

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TECHNOLOGY MASTER Before joining Sky in 2006, Didier Lebrat worked at Vodafone Italy as Chief Technology Officer where his function covered the design, implementation and operations of network and information systems. He was previously CTO of Orange for five years. His previous experience was with Bouygues Telecom, the French mobile operator, where he had the initial responsibility of implementing the network operations organisation from scratch. His scope of responsibility was eventually widened with customer facing activities such as billing and collection. He spent the first 12 years of his career with Sita/Equant a global telecoms operator, where he led the network operations and customer service with staff presence on three continents. He is married with three children.

internal team and outside suppliers are completely upgrading and rewriting the set-top box software to “provide a different experience for customers”. And of course, a major development in the past two and a half years has been the roll out of Sky’s high deﬁnition (HD) television services as subscribers upgrade to channels beaming crystal clear images into their living rooms. Sky currently has 28 HD channels, set to rise to 30 by Christmas, showing around 10,000 hours of content a month – the widest choice in Europe. “There is nobody else who is matching this choice for customers in HD – it’s a very big differentiator and we are seeing great demand for this service,” states Lebrat. Sky currently boasts nearly 600,000 HDTV subscribers.

SKY’S KEY MILESTONES

From an internet portal perspective, the sky.com website has had its software re-written to make the site faster and smoother. The result has been a significant increase in traffic, while the popular and content-rich Sky Sports and newly re-launched Sky News websites have helped drive internet users to the different portals. Sky itself has been a broadband supplier since 2005 – a relatively short time compared to its main rivals – but has rapidly risen to become a top fi ve player and the fastest growing provider in the UK, something that Lebrat says makes him feel very proud. In terms of customer numbers, Sky Broadband is now in 1.8 million homes, or 20 percent of Sky’s customer base. Lebrat describes Sky’s broadband network

1989 Sky launches with a ‘Direct to Home’ satellite television service via the Astra satellite with four free-to-air channels. 1990 Sky and rival broadcaster BSB agree to merge and form BSkyB.

1991 Sky Sports launches its first channel.

1992 Sky signs a UK £304 million deal for exclusively live coverage of the new FA Premier League.

1995 Enters the FTSE 100 Index.

1998 Launches the UK’s first digital TV service, with 140 channels.

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as being “22nd century”. “I say 22nd century because we have the latest full-IP technology, which allows us to provide a number of new functionalities very easily and quickly.” Internally, Sky has been engaged in a two-year programme to consolidate 13 data centres into just two – one in Southampton, in the south of England, and the other in Amsterdam. So is this a costcutting exercise? “No, it is more about better cost efficiencies, which means we save on support costs and power – so it’s green too,” Lebrat enthuses. “The way Easynet, part of the BSkyB group, designs these data centres is much more efficient than we used to. We use virtualisation for improving the efficiency of our server estate and storage by sharing between different applications rather than one box, one application model that we used to have here. So there are definitely significant savings while delivering better reliability and scalability.” The CRM systems have also been getting an upgrade, with an application launched recently based on service-orientated architecture (SOA). This provides new functionality on the CRM systems. “When you manage nine million customers you need to make sure that you can provide the best experience – both during customer activation and afterwards, as well as great service through the call centres and online.”

and technologies is one example. “The fact that we are multi-product and using a broad range of technologies means that the complexities are certainly increasing. And the simpler it is made for the customer, the more complex it is in the background. Making sure that this complexity is not transparent at the customer’s level is a constant priority. We always want customers to enjoy a seamless experience.” Another is the longer timelines required to develop new technologies, which make it crucial for Lebrat and his team to remain one step ahead of the marketing plan so the right technology platforms are in place to support business strategies. However, cost is one area that cannot be ignored. Lebrat’s role is all about ensuring that investment is used as efﬁciently as possible and that projects have a clear and acceptable level of ROI. He says: “We make sure that every investment that we make is properly scrutinised and justiﬁed so that we don’t spend on anything that will not provide a proper return. The scrutiny on investment is higher than ever.” Sky constantly reviews the way it operates and who it partners with to drive the right balance between quality, speed of service and cost, he goes on to say. As the interview draws to a close, Lebrat leans back in his chair and chats openly about the buzz he gets from being CTO of a company like Sky. Seeing new products become a reality gives him a great feeling, he reveals. “The real satisfaction is knowing that, when I see a Sky product advertised as I drive through London, my team made it happen. Everything we do in technology will eventually translate into a new customer product or experience.” But he says the biggest buzz is being able to provide a unique experience for customers. “It is really exciting being in charge of such a broad function and being able to deliver end-to-end solutions that are so important for the business and our customers. We b believe in better and we make it happen.”

Sky Broadband boasts

1.8customers million

Obstacles Handling all of these projects from start to ﬁnish means that Lebrat needs to have a holistic view of all aspects of the business. “I don’t think there is anyone who can be an expert on all of these domains at the same time,” he remarks. And all of these aspects come with their own unique challenges that have to be overcome. “We could ﬁll the whole of CXO with the challenges that we face everyday y y here,” , he exclaims. Increasing complexity of products

2001 The five millionth subscriber is signed up. Sky+ hits the market, putting customers in control of how they watch TV.

2007 Acquires the leading set-top box supplier Amstrad.

2005 Sky reaches eight million television customers – around one in three homes in the UK.

2008 Sky reaches nine million television customers and is confirmed as the fastest growing broadband and home phone provider in the UK.

2006 Sky+ HD becomes the UK’s first nationwide HD TV service. Sky Broadband is launched, bringing more choice and value to the sector. 2003 James Murdoch becomes CEO, replacing Tony Ball.

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EXECUTIVE INTERVIEW

Putting service first Tim Rooney of BT Diamond IP tells CXO Europe about the benefits to companies of using a service-oriented IP address management system. CXO. What is IP address management and why is it important? Tim Rooney. IP address management or “IPAM” as it’s commonly abbreviated, applies network management disciplines to IP address space and associated network services, namely DHCP and DNS. These disciplines cover a wide range of IP address management tasks, including configuration, change control, auditing, reporting and so on. They are all absolutely necessary given the requirement for properly managing IP space and DHCP and DNS servers. Without accurate DHCP configuration, end users may not be able to obtain IP addresses to access the network. Without proper DNS configuration, usability of the network will greatly suffer as the name-to-address lookup process may fail. And it’s equally important that these DHCP and DNS configurations are based on a common IP address plan, which maps out the IP address hierarchy, subnets, address pools, and domains. CXO. Sounds pretty important, but is IPAM less critical for converged services networks? TR. IPAM is actually more critical for converged services networks. Considering the common foundation of a converged services network is the IP network itself, it stands to reason that it must be managed more scrupulously than a monolithic “data-only” network. If there’s an issue with the IP network, the impact to multiple or all communications services is greater within a converged network. Minimising or eliminating such issues requires a disciplined network management approach for all IP network elements, including those critical DHCP and DNS servers. And this of course is where IPAM comes in. The other unique requirement for managing a converged IP network is the mapping of address space to a corresponding IP service. For example, VoIP packets may need higher priority routing treatment than, say, data packets. This routing treatment is typically

provided by examining IP addresses in each packet. Therefore, the IP address plan requires a service perspective to map and manage each converged service’s address space. CXO. That raises an interesting point. How would a company’s administrators for one service manage their IP space separately from others? Would they need separate IPAM systems? TR. As long as they use a service-oriented IPAM system, they will need only one system. A service-oriented IPAM system can manage multiple address spaces, support both IPv4 and IPv6 protocols, and can administratively segregate these spaces. For example, you could deﬁne a set of VoIP IPAM administrators

Tim Rooney has worked with IP technologies in various capacities over the last 16 years. As Product Management Director with BT Diamond IP, Tim is responsible for the overall BT Diamond IP product lifecycle, product feature introductions, and supporting sales and marketing. Tim holds a B.S. in Commerce and Engineering Sciences from Drexel and an M.S.E.E. from Rutgers University.

who have access to managing the VoIP address space and corresponding DHCP and DNS services. Meanwhile, a set of data IPAM administrators would have visibility and access to the data address space and services, and so on. Administrative access for the central IP team is also needed for visibility over the entire IP network, spanning these services-specific spaces. Delegation of administrative access, without loss of centralised management control, is one of the key advantages of deploying a service-oriented IPAM system that has the flexibility to partition the network along service, business or technology lines. CXO. What additional benefits can be achieved using a service-oriented IPAM system? TR. The key benefit in deploying an automated, centralised IPAM system across multiple services, applications and devices is the cost savings it provides through productivity and performance gains. An automated system simplifies network administration by quickly implementing moves, adds and changes to better serve end-user requirements. This automation collapses what was once a manual three step process, riddled with data-entry errors, to a consistent one step process that saves time and reduces errors. Other benefits include enhanced auditing and reporting for the tracking and reporting of administrator access, as well as address assignment and capacity management for industry and government regulatory compliance reporting. Use of a centralised IPAM system also facilitates ITIL or network management integration using APIs, scalability, performance, and redundancy providing another layer of operational efficiency. The IPControl product suite from BT Diamond IP delivers these benefits and much more. BT Diamond IP is a leading provider of software and appliance products that help customers effectively manage complex IP networks. For additional information, please visit http://btdiamondip.com or call +1-800-390-6295 in the US or +1-610-423-4770 worldwide.

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Addressing the future IPv6 is set to revolutionise IP address management, tackling critical address shortages and increasing security. But slow adoption of the technology means widespread usage is some way off. Graham Titterington, Principal Analyst at Ovum, explains the challenges on the road ahead for IP technology. P management is key to ensure successful technological deand so this creates inertia in the system. The result is pockets of IPv6 velopment. After the initial allocation of an IP address by the that tunnel across the internet to other pockets of IPv6. registration authority, it has to be secured. The danger is that Full message encryption in IPv6 radically reduces the risks of attackers might hack a router to redirect communications with it ‘man in the middle’ attacks. This removes a major avenue of attack or insert a ‘man in the middle’ to interon services such as internet banking where cept and modify communications.Hackers currently hackers are able to steal credenmight also insert redirection into the web tials and corrupt transactions, and imperpage. To make it appear to a user that they sonate the customer to steal money from are in that site when they are actually in the their account. hacker’s site. One of the long term problems threatening IT management is the allocation of IP “Adoption of IPv6 will allow addresses themselves. Most of the internet better management of IP runs on IP Version 4 at the moment with 32-bit address for those companies addresses, which unfortunately the world with complex networks” is running out of. We have had to resort to dynamically allocated IP addresses so that people in the consumer space are able to share an IP address. This requires dynamic Currently, adoption of IPv6 is slow beaddress translation within the internet and cause of the inertia of the internet. Adoption this creates a security weakness. The probis straightforward within corporate networks, lem is exacerbated by the absurdity but corporates are restricted by the of the initial IP address allocation, need to remain compatible with the where, for example, MIT in Boston internet. Upgrading to IPv6 interGraham Titterington, has over 30 years experience in has as many IP addresses allocated nally requires new software at the the IT industry. He has worked at Ovum for 16 years, to it as the whole of China. infrastructure level. The larger the where he focuses his expertise on the areas of IT Systems Dynamic address translation is company is, the more it will benefit security and business continuity. He previously worked in a security problem because it preby migrating to IPv6, with the main the field of software quality assurance. vents the encryption of the header benefits going to large multi national Titterington is the lead author of several Ovum fields in internet messages, as the organisations. It does not matter reports including E-Business Security: New Directions addresses have to be in the clear. which vertical the organisation is in, and Successful Strategies, and Networked Storage: New You can still encrypt the bodies of rather it is a matter of the size and Developments and Market Opportunities. the messages, but routing is vulcomplexity of its internal networks. nerable because addresses need to Adoption of IPv6 will allow be translated en route. better management of IP address’s The introduction of IPv6 solves these two problems with the for those companies with complex networks. With IPv4, address are in provision of a much bigger address space and the ending of the need short supply and to make best use of them, you should allocate static IP for dynamic address translation. IPv6 has potentially one address for addresses to the things that need the highest quality of service, and use every square foot of the earth’s surface. the dynamic addresses for the other devices and services. IPv6 provides The problem that IPv6 faces is the management of the migration a much more comprehensive encryption of the entire message. from IPv4, particularly given the unmanaged state of the internet. The Management is essential in making those careful decisions entire online community cannot change their IP addresses overnight, about priorities.

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ASK THE EXPERT

Managing change Many companies are not taking full advantage of automated IP address management technology despite a growing need to tackle the issue. Clive Norris, founder and technical director of Crypton Computers advises companies on how to choose the right IP address management solution.

ith the increased growth in IPv6, VoIP phones and mobile PDA devices, IP address management (IPAM) is rapidly becoming the top priority for network managers. You may be surprised to learn that most large organisations in Europe today, are still using the humble spreadsheet to manage their subnet and IP address assignments. If you’re responsible for managing your company network, you’ll know that spreadsheets are; not scalable beyond a few thousand IP addresses, prone to errors, putting vital IP data integrity at risk, and cannot be accessed remotely by multiple users at the same time. What you really need is an intelligent, easy-to-use IP address management platform that automates the IP address assignments, tracks the utilisation of IP space, and scales to large enterprise networks. But why should you consider an IPAM solution for your organisation?

• Are you still using spreadsheets to manage your IP address assignments? • Experiencing network downtime due to duplicate IP addressing errors? • Need to manage multiple instances of IP address space?

Clive Norris is the founder and technical director of Crypton Computers , the UK’s leading developer of IP Address management software. He has more than 22 years of hands-on IP networking experience, having designed and implemented some of the largest ISP networks in Europe, including NTL (now Virgin Media), and Chello Broadband in Norway.

• Just had a company merger or relocation? • Is your network actively changing? • Are you planning for migration from IPv4 to IPv6 yet? • Do you want to know your address space utilisation?

Key Considerations A true enterprise IPAM solution must include the following high-level requirements: • IP address planning tools to help you plan and document your IP addressing scheme • Web-based GUI for remote access from any location • Role-based user access lists for multiple administrators • Manages both IPv4 and IPv6 addressing simultaneously • Automated SNMP discovery for accurate inventory of all network devices • Audit Trail to track changes for regulatory compliance • Flexible and detailed custom management reporting Optional features include, mapping of DHCP scopes, API’s for custom development, automatic synchronisation with DNS & Bind servers and integration with other Network Management Systems, such as Tivoli or HP OpenView. On the market today, there are three types of IP Address Management Solutions to consider: Open Source or Shareware; scalable enterprise software; appliancebased hardware. Each has their advantages and disadvantages.

Appliance-based Hardware Solution If you are looking for a solution that bundles DNS & DHCP services with IPAM, then

you might consider an Appliance-based product, but there are several disadvantages to the Appliance- based solution: Higher initial CapEx cost for hardware; requires complex inter-departmental and managerial decision making; fork-lift upgrade for integration with existing DNS infrastructure; some appliances cannot scale to millions of IP addresses.

Open Source or Shareware Solution There are plenty of open source and shareware tools for use in very small deployments, but they usually come with minimal support and ongoing feature development may be sporadic at best.

Enterprise Software Solution For large-scale IPAM deployments in a mixed vendor environment, you need a scalable, multi-user, web-based software solution supported by an industry-standard SQL database. The key advantages of a software solution are that the existing DNS infrastructure does not need to be replaced and a simple pricing model offers transparent budgeting. The industry standard SQL database allows IP and DNS information to be easily distributed to currently deployed DNS & DHCP servers.

Conclusion Despite the bewildering choice of IPAM solutions on the market today, we believe that software-only products will remain the preferred solution for enterprises, service providers and telecoms and government organisations that require a simple low-cost migration path away from their current inefﬁcient spreadsheet solutions.

To find out how we can help you choose, contact us at: Tel: + 44 17 30 81 45 94 Email: sales@crypton.co.uk Website: http://www.crypton.co.uk

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ASK THE EXPERT

THE

POWER OF IPAM Ron Santos explains how Internet Protocol Address Management (IPAM) can deliver a multitude of benefits including improved staff productivity, reduced costs and greater ROI. rganisations use IPAM tools to keep an inventory of IP addresses in their networks and to configure their DHCP and DNS servers. In brief, users depend daily on DHCP servers to get a lease on IP addresses for their network devices, such as PCs and VoIP phones. They depend on DNS servers throughout the day to map domain names in web addresses and e-mail addresses to IP addresses. Many organisations do this address management using fairly simple tools, including manually managing addresses using spreadsheets. However, there are several benefits to using a feature-rich vendor-supported IPAM solution instead. In particular, significant financial savings normally result from the deployment of one of these solutions. This is true primarily due to staff productivity gains and fewer errors in managing IP addresses, DNS servers, and DHCP servers. Through the use of a good IPAM solution both IT staff productivity and user productivity significantly improve. IT staff productivity improves as a result of the following benefits:

Automation of manual procedures. For example, user-created rules and templates can be used to reduce work by automatically and consistently creating best-ﬁt address space for new sites and groups. Even more automa-

tion can be achieved through the use of an associated workflow manager. Simplification In general, administrators enter less and simpler information in an IPAM GUI than, for example, in complex text-based DNS and DHCP configuration files. Error checking Sophisticated error checking functionality is used to perform data validation and consistency checks to reduce the number of human errors, and prevent malfunctions from occurring. Expedited troubleshooting and investigation The ability to quickly run standard and ad-hoc queries and reports reduces the time spent troubleshooting problems and investigating security breaches. Standardisation Networks, global policies, and naming conventions can be efficiently managed centrally, while adequate regional and local control over subnets is provided.

tionally, sophisticated IPAM solutions provide the capability to configure administrator alerts based on the usage of IP addresses and device MAC addresses. These solutions also provide well organised and easily searchable histories of the usage of IP addresses, associated devices, and, in some cases, associated user IDs. Consequently, quickly finding needed information in cases of network misuse is much easier than, for example, searching through DHCP log files and spreadsheets. To reduce network expenses, feature-rich IPAM solutions provide capabilities to monitor and report on DNS and DHCP server utilisation. Some organisations that have used these reports have been able to remove or redeploy dozens of under-utilised DNS and DHCP servers. Maximising ROI involves finding a quality IPAM product from a reputable vendor with a feature set that best meets an organisation’s needs at a price within its budget. For some organisations the payback period on their IPAM deployment is less than half a year, so the business case here can be very appealing. Additionally, for some organisations, especially small and medium size ones, deploying IPAM appliances instead of software-based IPAM solutions maximises ROI. Clearly, there are several advantages to using a feature-rich vendor-supported IPAM solution. Furthermore, as the number of IP addresses in an organisation grows, the benefits increase. Consequently, one especially beneficial time to deploy this type of solution is before a VoIP deployment, since that significantly increases the number of IP addresses an organisation has to manage. There are now many IPAM solutions available, but over the past few years the market-leading IPAM product has been Alcatel-Lucent’s VitalQIP. For more information on VitalQIP, please visit www.alcatel-lucent.com

Also, user productivity improves because there are fewer problems with users getting valid IP addresses from DHCP servers, reductions in application unavailability due to DNS errors and address conﬂicts and reductions in the time necessary to resolve troubles reported to a help desk. To improve security, a featurerich IPAM product includes a Network Access Control (NAC) module or supports easy integration with a third-party NAC product. Addi-

Ron Santos is a VitalQIP Product Manager at Alcatel-Lucent. He has over 20 years’ experience in the telecommunications industry, primarily working as a systems engineer at AT&T, Lucent, and now Alcatel-Lucent.

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MEDIA

SCORING BIG WITH WEB 2.0

As football fans ditch the couch for the computer to get their soccer fix, UEFA – Europe’s football governing body – has been quick to respond with its comprehensive uefa.com portal. Daniel Marion, CTO for New Media Technologies, is the man charged with making it all happen online.

ith between 50 and 60 million page views an hour, uefa.com is a content-rich site that provides a deﬁnitive source for football information, results, live footage and more as the internet becomes an increasingly important resource for fans. UEFA’s biggest event to date was EURO 2008, held last summer in Switzerland and Austria. This tournament generated tremendous interest on the site, with more than 1.2 billion page views recorded. Daniel Marion, the man charged with orchestrating UEFA’s new media efforts, says: “The younger generation are consuming more and more online rather on TV so we try to be as proactive as possible when it comes to what we have on the internet.” UEFA relies upon Microsoft to provide a bespoke content management solution for updating the web pages with news, statistics and video. “We build uefa.com as a static site with predefined blocks and we take advantage of a content distribution network to bring it to the fans and users,” he explains.

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For Marion and his team, speed of service is critical. Fans demand up-todate information, especially scorelines and results – otherwise they will go elsewhere on the web. “We have a site that is live so we have similar challenges to a news site,” Marion notes. “If we deliver news of a result ﬁve minutes late then we have failed to achieve what we set out to do; we have to have pages updated very quickly.” He adds: “With such a dynamic site you have distribution issues where someone accesses a version of the content and discovers that it is 30 seconds old and they see a different result displayed; this is something we try to avoid as much as possible.”

Live footage One popular feature of the site is the ability to watch matches online with live streaming. For instance, UEFA’s Champions League – the lucrative tournament for Europe’s elite domestic sides – allows fans to pay to follow their team or a game that is not being shown on TV in their country. “Your broadcaster may show a match that bosses consider to be the best of the day,” Marion

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also have to make sure that users don’t go too far, so policing the site is very difficult.” With these comprehensive offerings on multiple platforms you would be forgiven for thinking that Marion and his department have reached a ceiling with new media. Marion, on the other hand, stresses that you cannot rest on your laurels today because there are so many media outlets vying to be first with news and results and provide users with new services. Indeed, Marion says he is constantly on the lookout for new technologies and offerings that will improve the site and services for the 21st century football fan. For example, Marion has recently launched an improved statistics service. “These improved statistics give you a better view of player information and how they are performing,” Marion explains. “It means that you can watch the action from the eyes of the referee or the goalkeepers, which brings added value to the coaches or the referees for training purposes.” He also notes how the integration of Adobe’s Flash and Microsoft’s Silverlight is transforming the site. “These tools add new opportunities to provide more information about the match you are watching and have more content integrated in the footage or moving images. For instance, we could overlay statistics or you could click on a player profile in a seamless fashion as opposed to how it is now with HTML.”

Make a connection

notes. “But you might not want to see Manchester United or Juventus because you are a fan of Ukranian side Shakhtar Donetsk. With this service you can watch any of the eight games being played on a night.” Users pay around €2.50. Some of the games are streamed by uefa.com on behalf of the broadcasters, however. “We have built a platform to deliver live coverage on behalf of our broadcasters if users wish to use us,” says Marion. There is also a ‘video on demand’ service for those who have missed any of the action or wish to re-live a striker’s 25-yard volley into the top corner of the net. And for those on the move, the site offers mobile goal alerts, while fans in certain countries with 3G phones can subscribe to video highlights. The site itself is crammed with news and statistics on club and national sides, as well as players. Fans can also chat with one another, but this aspect is not without its challenges. “We want fans to interact and chat together on the site but we don’t want them saying too many bad things; we are the governing body for European football – not a gossip magazine.”Marion continues: “We can proﬁt from what Web 2.0 brings but we

Being an organisation with a large European reach, UEFA itself, headquartered in Nyon, Switzerland, is a proponent of technology being able to aid communications. Marion says web and video conferencing facilities allow UEFA officials and staff to communicate effectively across countries. And, of course, it cuts UEFA’s carbon footprint. “We are seeing web conferencing being used more and more to reduce travel but you have to have the ability to hook up to a conference from your own laptop. We find that teleconferencing makes it a bit more difficult to retain focus for all of the participants but web and/or video conferencing brings a lot more focus into the discussions.” Around 30 percent of staff use instant messaging on a regular basis to communicate and Marion says having the one number when he is abroad at tournaments like EURO 2008 proves invaluable. “I have the same phone number so that when someone rings I can just answer the phone seamlessly. We also take advantage of softphone so that we can connect to the network and use laptops as communications devices.” Technology, it appears, is being embraced as a an enabler for UEFA’s operations and is transforming the way that football supporters consume content. Who knows what platforms and technologies will be out there by the time EURO 2012 comes around? Watch this space.

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RETAIL

talk

SHOP

Germany’s METRO Group is developing technology that will change the way we buy our groceries forever. And where better to test them out than on the shop floor? CXO goes behind the scenes at METRO’s Future Store initiative and meets CIO Zygmunt Mierdorf. 68

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here aren’t many CIOs who are given the chance to test new technologies in a gigantic laboratory complete with real customers. But that’s exactly what Zygmunt Mierdorf, CIO of retail giant METRO Group, has been able to do thanks to the company’s Future Store Initiative. Created as a real-life testing ground for technologies designed to revolutionise customers’ shopping experiences, the Future Store in the German town of Toenisvorst is the shape of things to come, according to Mierdorf. As CIO of one of Europe’s largest retailers, which runs over 2100 outlets in 32 countries across Europe, Asia and Africa, he is already responsible for overseeing IT and logistics operations

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across all of METRO’s retail divisions, including the Cash & Carry wholesale stores, Real hypermarkets, Media Markt and Saturn consumer electronics stores and Galeria Kaufhof department stores. Through the company’s Advanced Retailing strategy Mierdorf is spearheading a technological revolution across METRO’s operations. Describing the background behind the Advanced Retailing strategy, he says: “The METRO Group Future Store Initative was founded in 2002, as an alliance of companies and organisations from the IT, consumer goods and service sectors. Today, more than 90 companies and organisations are working on the project. Together with our industry partners we set the goal to push forward the modernisation

of the retail sector. One of the aims of the initiative is to test new technologies that will make the shopping experience as pleasant and stimulating as possible.” There are two parts to METRO Group’s strategy – the development of technology to be deployed on the shop floor for hands-on use by customers and the technology that is being developed behind the scenes to ensure the smooth running of the company’s operations. On the shop floor, innovations include the world’s first mobile shopping assistant (MSA), an application for mobile phones which can be used to scan product bar codes displaying the price of each product and allowing customers to keep a continuous tab of how much they have

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spent. When it comes to paying for the products, customers simply take the MSA to a pay station to settle the bill. Another groundbreaking innovation is Pay by Fingerprint – a service available to customers who register their bank details with a service provider. Customers can then pay for their goods simply by placing their finger on a scanner. There are also smart scales that automatically identify fruit and vegetables for customers, and selfcheckouts where customers can carry out the entire checkout process themselves. Having been successfully piloted at METRO Group’s Future Store, the technology is now being rolled out across the group’s mainstream outlets.

nine months of 2008, METRO Group’s sales rose by 7.1 percent to €47.8 billion and in the third quarter its sales in Germany rose by 2.4 percent despite the streamlining of the Real hypermarkets stores portfolio amidst difficult market conditions. “We announced our nine month figures to the public, which were pretty satisfactory,” explains Mierdorf. “It is a challenging time but we are convinced that with our business concept and the performance of our sales divisions we are well-positioned for the upcoming competition.”

New technologies

But it is not just the high profile shop floor innovations that are helping to drive METRO’s bottom line. Innovations such as selfFacing change checkouts may be bringing cusMierdorf says METRO Group’s tomers into stores, but behind the aim to stay one step ahead of its scenes, it is RFID technology that competitors in the retail space. is speeding up its ability to re“The retail business is well-known stock the shelves. A study carried for its constant change and quick out by the Group and its partners METRO Group is one of Europe’s most important international retailtransformations,” he notes. “We alat warehouses for the company’s ing companies: Some 290,000 employees from 150 nations work for ways try to sense the wishes and Cash & Carry division concluded the company at over 2100 outlets in 32 countries in Europe, Africa desires of our customers even bethat the technology could bring and Asia. The company is made up of the following divisions: fore they realise them. Today we are savings of up to €8.5 million even already using many of the technoloif only a small part of the supply • Metro Cash & Carry gies that were tested in stores bechain is considered. • Real hypermarkets longing to our own sales brands.” This led METRO Group to use • Media Markt and Saturn, Europe’s leader in consumer electronic When it comes to introducing RFID technology to optimise its loretailing technology on the front line howevgistics and warehouse management • Galeria Kaufhof, the system leader in the department store business er, one big challenge facing METRO processes by attaching RFID tags Group is customer acceptance, par(transponders) to pallets, clothing METRO AG is the group’s strategic management holding company. ticularly when it comes to biometric shipments and cartons, which enable The operative business is divided into the business segments of technology. “The technology itself the company to easily process inwholesale, food retail, non-food specialty stores and department doesn’t create any difficulties. It is coming and outgoing goods. stores. Throughout the group, cross-divisional service companies more about change management Describing the beneﬁts of the techperform services in such areas as procurement, logistics, informawithin our organisation and accepnology, Mierdorf, says: “The operation technology, marketing, gastronomy and real estate for the tance from customers” says tional impact of the initiative is even sales brands. Mierdorf. “Let’s take for instance bigger on the side of our business the multiple options we have introthat the customer does not see.” For duced for the checkout process. So far we have been able to substanexample, by using RFID those in charge know exactly how much stock is tially increase the percentage of customers using the self-checkout still in the warehouse. As stock levels are managed actively, average levels area, but people obviously still need to get acquainted with the Pay by can be reduced. “Painstakingly counting every single item is a thing of the Fingerprint facility,” he goes on to say. past as stock levels can be checked using the merchandise management While the public may take a conservative approach to some of system.” The RFID technology is also being deployed in-store, for instance these innovations, the company is clearly moving forward. In the first to provide automated product recognition technology for inventory con-

METRO Group

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METRO and DHL Earlier this year DHL and METRO Group announced they would start the first national rollout of radio frequency identification (RFID) in France and the largest in French retail logistics. Beginning this autumn, DHL will equip all shipments to the 89 Metro Cash & Carry selfservice wholesale stores in France with RFID transponders and read them out along the entire supply chain. Some 1.3 million pallets per year will be fitted with the RFID tags to facilitate contactless and automated monitoring of the supply chain. “This project is setting the trend for the whole logistics industry as it brings the era of pilot projects in RFID technology to an end,” says John Allan, Chief Financial Officer of Deutsche Post World Net. “RFID is ready for everyday use.” He goes on to say DHL expects the major project to send a signal to the entire area of retail logistics as well as to other segments of the logistics industry. METRO Group hopes the prospect will drive forward the international deployment of the technology. “By expanding our operational deployment of RFID to France, METRO Group is proving that the benefits of the technology can be realised pallets per year will throughout Europe,” says Zygmunt be fitted with the Mierdorf. In the RFID project, five DHL food RFID tags logistics centres will equip all shipments to the self-service wholesale stores with RFID tags. These RFID transponders are read out during the loading process, and the data is electronically transmitted to the individual stores. When the shipments arrive at the recipient’s facilities, the tags are read out again and the data is automatically checked against the order. In comparison to conventional controls using barcodes and barcode scanners, the contactless RFID process speeds up loading and unloading operations. In addition, the automated reading technology increases the precision of logistics processes, while visibility and manageability grow as a result of the improved pool of data.

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trol and quality assurance monitoring of self-service meat products. In the Future Store, products are kept in a Smart Freezer, which features RFID readers that monitor the smart chips attached to the product packaging. This enables staff to uniquely identify every meat item in the freezer and easily keep up to date on when items are reaching their ‘best before’ dates. Mierdorf says, however, that the current focus for the company is on the use of RFID in logistics and warehouse management. He does not foresee the replacement of barcodes by RFID tags in the near future. “It will still take a long time before RFID tags on products will completely replace barcodes. Both systems will run in parallel in the coming years and will complement one another.” METRO Group is currently focusing on using RFID to streamline its logistics and warehouse operations and to develop new uses for the technology. “The broad use of RFID in logistics will make several more trailblazing innovations possible. And with our pilot projects with textiles and fresh meat, we are gathering experience of deploying RFID on an item level.” Looking at the technology development over the last four years, he predicts that within 10 to 15 years RFID technology will have developed to such an extent that it will be possible to calculate the cost of the contents of a customer’s trolley simply by wheeling it past an RFID reader. “Just think, in 10 to 15 years you might just need to drive the trolley through an RFID reading device and all the products inside will be calculated automatically within a second. Queues in stores will be a thing of the past,” says Mierdorf.

Future potential So confident is the METRO Group in the potential of RFID technology that in 2004 it established the RFID Innovation Centre in the German town of Neuss, which acts as a test and research lab for RFID technology, providing suppliers, IT partners and other interested parties with 2000 square metres of space in which to trial different applications of the technology in real-life conditions. This approach is typical of the group, which strives to work as closely as possible with its partners, suppliers and solutions providers to find solutions to the challenges it faces. Like all retailers, it has been hit by rising fuel prices, leading to increases in the cost of transporting goods, as well as by additional increases in the cost of food commodities. In order to best adapt to these changing conditions, the company is forming stronger relationships with its partners as part of its Supplier Relationship & Collaboration Management Programme initiative. “In the past year, the scarcity of commodities led to an increasing volatility of food prices and the steady rise of energy prices has meant increasing costs for the transport of goods that we offer,” remarks Mierdorf. “Both developments call for innovative concepts in procurement and logistics along the whole supply chain. In other words, we are establishing new forms of cooperation with our industry partners.” The aim of the initiative, explains Mierdorf, is to “build up strategic partnerships and to optimise the supplier interfaces on an international and cross sales line level with the help of clear responsibilities on both sides.” METRO Group’s strong international presence makes such strategic alliances and the need to optimise supply chain networks even more imperative. The company is cur-

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rently present in 32 countries and it continues to enter new countries, products. The company has committed itself to reducing its greenhaving recently announced market entries in Kazakhstan and Egypt. house gas emissions by 15 percent within the next seven years, havMany of its international operations take place in remote areas where ing become the first German retail company to publish information it encounters very different logistical challenges from those on its on its carbon footprint. home turf in Germany. To achieve this the company will focus on measures such as saving Picking one such example, Mierdorf describes the logistical chalenergy, decreasing refrigerant evaporation, optimising the bundling of lenges the company faces in Russia, where its Cash & Carry stores in goods flows and reducing its use of paper for advertising. “We attach Siberia are over 4500 kilometres away from its first great value to ensuring the future success of our busistores in Moscow and St Petersburg. “When we startness in a socially responsible manner,” says Mierdorf. In the first nine ed our business in Russia the infrastructure there did “We can only generate lasting and profitable growth months of 2008 not meet our demands. Many Russian logistics comand successfully optimise METRO Group's investment METRO sales rose by panies had an outdated fleet of vehicles. Road condidriven strategy if our core business is managed in a tions outside the major urban centres are often poor sustainable way.” While corporate social responsibiland rail transport is not a competitive option with a ity is a key priority for METRO, like all retailers across view to price and time constraints. Therefore we had Europe, its main strategic objective is to find ways of to €47.8 billion to make substantial investments in the Russian infraboth attracting customers and ensuring the maximum structure. We invested into the modernisation of truck efficiency of its operations against a backdrop of diffifleets and into the optimisation of cooling chains.” cult economic conditions – key factors behind its adoption of RFID techMETRO is keen to extend this strategy of investing part of its nology and investment in the Future Store Initiative. profits into developing the communities and infrastructure around Despite the challenges ahead, however, Mierdorf has a confident its operations. Within India it has set up a public/private partnership outlook on the future of the METRO Group, revealing that the compawith the German Investment and Development Society to train over ny plans to grow at around six percent on an annual basis in the medi40,000 sheep farmers and 1500 fishing crews in the region in how to um term – a reflection too of his confidence in the company’s corporate maintain hygiene standards and to guarantee the safety of their strategy and its development of revolutionary technologies.

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NEXT BIG THING

VISION Matthew Light, Managing Director of Tempura Communications, reveals what the future holds for video conferencing technology as it grows increasingly in sophistication.

here have been two major influences behind the growing popularity of video conferencing technology. Firstly, a lower cost of entry that has been driven by technology improvements, manufacturing practice and volume. Secondly, the transition into IP-based video removing the uncomfortable unknown costs of calls associated with ISDN and the reduced cost and greater availability of networks capable of handling day-to-day data traffic as well as video and voice traffic. This technology has evolved significantly since its introduction when many clients experienced jerky animation. Traditionally, the network was the cause of most of the problems with animation quality; furthermore specialists were not on hand to resolve these issues because the suppliers of video equipment were audiovisual specialists not networking experts. Thanks to the development of IP-based video conferencing, these issues are set to become a thing of the past. Today, the most high-tech video conferencing technology is IP-based and sits within the network. The systems running High Definition Video are of exceptional quality when correctly matched to the network capable of running it. Videoconferencing over IP is just the tip of the iceberg – this technology is set to become even more high tech. We have all seen films showing holographic and 3D video images. These technologies are being worked on and will one day be used within the realm of video conferencing. I would say for the immediate future, we will see a complete move to IP video, with more intelligence within the systems to make them easier to use. For example, with a phone you pick up a handset and dial a number. With most video kit you go to make a call, choose whether it is IP or ISDN, then select what speed you want to make the call and dial. The future is to just type in a number or a name and call. The system will then look at the available bandwidth and simply complete the call based on the scenario it sits within. Further down the line video will be rolled out to the desktop for face-to-face personal confer-

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Matthew Light – MD of Tempura Communications based in Basingstoke – has over 11 years’ videoconferencing experience and advises UK, European and American SMEs, Corporate and Government departments, as well as Reseller Channel partners on both the networking and conferencing aspects of the projects at hand.

encing. Our new Software As A service Solution (SaaS) brings high definition videoconferencing to the desktop. This subscription-based service really has no limits as it really does bring video communications to the masses incorporating home workers as well as desk based office staff. The meeting rooms continue to be used for group video and these will evolve with telepresence enhancements, but the real driver moving video forward will be increasing the total video user base. There are multiple benefits for companies deploying this technology. The usual answers al-

ways come up when discussing cost justifying video, travel and time saving, faster response, reduced travel and the environmental issue. These are all valid, but in truth the experience is more that of efficiency and productivity gains as well as enhancing business relationships. Videoconferencing (particularly to the desktop) brings back personal relationships. If during a meeting additional expertise is required, the expert can be added into the video call wherever they are based. A one-hour meeting now lasts an hour, not the multiple hours travelling to and from the meeting and home workers are no longer isolated. To ensure a company takes maximum advantage of this technology they need to adopt a solution that meets their needs and is scaled to fit their organisation. Tempura Communications provides companies with solutions tailored to suit their specific requirements, whereas manufacturers all claim their systems are the best and leave you to sort out your own network. We listen to the project brief, issues and drivers and then advise on the best fit across multiple vendors and suppliers. Manufacturers all seem to make the same mistake in that they focus on the technology rather than the customer benefits. We are all aware of manifacturers’ technical competencies, but here at Tempura we explain how the feature sets benefit the organisation rather than just what the features are. Whilst systems are more capable than they have ever been, they are easier to use too. The simpler the operation the more they will be utilised. At a basic level these are a telephone with a picture. They enable face-to-face communications at a touch of a button or four. How they work is not as important as what they give. We focus on the competitive edge, the personal contact and relationship plus points, time management and efficiency, team work and modern working practices. Ultimately, this is why you are looking at the product in the first place.

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INDUSTRY INSIGHT

Networking your way to success Andre Bonvanie, of NewsGator, reveals his 10 definitive strategies for Enterprise Social Networking success.

re you thinking of deploying something like Facebook as a business tool in your enterprise? Many companies are: Enterprise spending on Web 2.0 technologies will surge over the next ﬁve years to reach US$4.6 billion globally, predicts Forrester Research. The following strategies will help ensure your initiative ﬂourishes.

their good ideas adopted, they sense ownership and become power users. 6. Incentivise. In the long term, an effective social computing system is its own reward. Early on, however, employees will respond quickly to public recognition from the champion, scoring mechanisms that spotlight valued contributors, and, if appropriate, monetary compensation.

1. Deﬁne acceptable use. Although the purpose of enterprise social networking is improving business performance, enjoyment is part of the calculus. How much ‘fun’ is acceptable? Will non-work content be emphasised or discouraged? Set expectations in a few sentences and let everyone know up front. 2. Find a champion. The champion provides the push at the beginning of the project and discovers advocates who can establish momentum. 3. Select initial users. Going enterprise-wide from the start doesn’t usually work for companies of more than a few thousand users. The ideal starting group contains plenty of workers who already share information. Consider younger workers, since they tend to be more open, willing to share, and familiar with social networking tools. 4. Understand your users’ existing processes. Success is likely if you can make your enterprise social computing tools the easiest and most natural way to do the work that is already taking place. A discussion forum, for example, can replace a long and confusing email thread. RSS (Really Simple Syndication) technology provides a seamless way to share content without clutter, and to ensure your social network stays fresh and relevant. 5. Provide a feedback mechanism. For a social network to evolve, managers need to encourage and incorporate user feedback. When users see

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Andre Bonvanie heads NewsGator Europe. Formerly, he was CEO and founding partner of Atlantic Crossings, a Dutch communications strategy company running pan-European sales and marketing programmes for major software and IT services companies. Before Atlantic Crossings, Bonvanie worked for several years at Microsoft in various sales management positions.

7. Integrate with current online destinations. Success chances skyrocket if users can participate from the environments where they already spend their time. For example, rather than build a social networking application from scratch, simply layer social computing features like networking, communities, discussions, tagging, social bookmarking and blogging on an existing portal or intranet. NewsGator Social Sites software, for example, transforms any Microsoft Ofﬁce SharePoint Server (MOSS) implementation into a full-featured enterprise social network without altering user habits.

8. Integrate with current processes. For example, one social networking site automatically builds time-tracking reports based on the user’s activities within the network, eliminating traditional busy work. 9. Provide the right modes of participation. Although some users may dive right into a new technology, some won’t. Email can actually be an effective way for some workers to participate if the solution is implemented well. Mobile devices provide essential participation options, too.

“Success is likely if you can make your enterprise social computing tools the easiest and most natural way to do the work that is already taking place” 10. Design for minimum effort. Every extra click or decision is a chance for the user to quit. Social computing interfaces should make actions as simple and obvious as possible. To settle on the best design, review business goals and focus on the interactions that directly support them. Karyn German, our vice president of customer care, tells me that many companies know that enterprise social networking takes collaboration to a new level and fuels innovation, yet they need direction to get started. These strategies are working for our customers and can be adapted to any organisation for immediate impact. Your organisation can be one of the Enterprise 2.0 best practices too! n For more information on what we have seen as best practices around our customers, read our ‘Social Computing in the Enterprise’ white paper which can be downloaded from this location: http://www.newsgator.com/Business/SocialSites/SocialCompu ting/Whitepaper_2.aspx

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ANALYST VIEWPOINT

The promise of unified communications Senior Research Analyst at IDC, Nora Freedman, demystifies UC adoption challenges and discusses when and why companies should make the move to UC. BM. What do you think the promise of unified communications (UC) is for companies who are prepared to do it right? Nora Freedman. The essence of unified communications is really about streamlining business processes that are already voice intensive, but not making them separate exercises. You want to minimise navigation between multiple applications. With UC, you’re trying to reduce time to ‘X’ – whether it be for an approval, finding out about available supplies, or locating a person or artifact. BM. There’s been some confusion around UC, in terms of the number of vendor offerings, different implementations, etc. How should firms clarify the decision-making process as to where to begin with UC? NF. You have to understand that UC is more of an architecture, as opposed to a point solution. All of the major IT vendors are hoping to capitalise on the attention being paid to this market. But putting the term ‘unified communications’ or UC in front of their product names, without additional product engineering, doesn’t automatically make those products UC-enabled. The future direction of a company’s unified communications strategy has a lot to do with its current infrastructure, because some of the steps in the process can be leapfrogged. Certain enterprise environments – dependent on which vertical market they are in – are just not relevant in others. BM. Can you discuss the heightened attention on security needed as these disparate pieces of technology become part of a unified solution? NF. The security part has to do with the fact that there are just so many more devices connecting to the network. Does your organisation have device-specific authentication policies? Or can users authenticate themselves across a variety of applications and devices? Are these identities consolidated into one directory service or multiple ones? Because there may be multiple directories within the organisation, it is crucial that all user information is consistent. Otherwise, the promise of UC may be compromised. Government regulations may also highlight new business requirements, especially in financial services and healthcare. Due to Sarbanes-Oxley and HIPAA, organisations must be acutely aware of

who is accessing customer and patient information and must also be able to provide an audit trail. Because new UC solutions may introduce a new level of auditing exposure, some organisations have decided to disable certain features. For example, some ﬁnancial organisations have disabled the voicemail capabilities of their uniﬁed messaging solutions, since they don't want these voice messages to become subject to SEC regulators and/or they lack the appropriate mechanisms to capture, archive and retrieve the voice messages to identify any policy violations.

BM. Can you talk about some of the best practices for making sure that communications are integrated with processes, workﬂow, applications and so forth? NF. Some of the best UC examples or UC success stories have come from those companies that have built UC steering committees within their organisations. Traditionally, those who purchase the IT solution are rarely those who are forced to use it every day in order to complete their job. The best-use case scenarios emerge from conversations between someone from IT, someone from the line of business, and someone from the executive level across the organisation. These groups tend to welcome explorations into what the real business issues are that need to be addressed and how UC can solve them. Consumer-based Web 2.0 applications have also increased the expectations among business users about what their organisations should provide them. For example, most of us became more adept at instant messaging from AOL and MSN Messenger, as opposed to using the Microsoft Exchange or Lotus Sametime. Only after security breaches occurred did enterprises learn about the corporate vulnerabilities exposed through the use of consumer apps into the enterprise. And thus, enterprise Nora Freedman is a Senior Research Analyst grade applications were deployed to displace those conwith IDC’s Enterprise Networking group. In sumer applications. Now, many consumers are expecting this role, Freedman provides research, the same level of usability coming from their Apple iPhones market analysis, and consulting services as from their enterprise devices and smartphones. n about enterprise IP telephony equipment, unified communications and telepresence. www.cxo.eu.com

ASK THE EXPERT

Making Contact Brett Caine, President of Citrix Online, discusses why web conferencing is making big waves in the business world.

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CXO. Why is web conferencing becoming so popular? Brett Caine. Web conferencing offers businesses an ideal way to keep in touch with remote employees, customers and prospects, quickly, easily, frequently and affordably. At a time of rising fuel costs and economic uncertainty, it’s especially attractive to businesses that are able to avoid spiralling travel costs, while enhancing their productivity and competitiveness. According to Gartner, the web conferencing and team collaboration software market in Europe, the Middle East and Africa grew 22 percent in 2007, with web conferencing accounting for 73 precent of this market. Wainhouse Research supports these ﬁndings, reporting that the UK web conferencing market grew by 29 percent in 2007.

ing that anyone can participate in meetings, regardless of their location.

CXO. Can web conferencing replace face-toface meetings? BC. Arguably, face-to-face contact can be vital in certain scenarios, but online meetings are increasingly being used for many business interactions. With online meetings, businesses can easily deliver sales presentations, conduct customer-training sessions, collaborate on documents and streamline projects with remote teams. In fact, many businesses are ﬁnding that using online meetings to communicate with customers, prospects and employees is actually more productive than the real-world equivalent, enabling people to keep in touch quickly, easily, frequently and affordably. According to the Big Oxford Computer Company, a small UK-based web development and design agency, the online meetings actually offer them greater collaboration potential than face-to-face scenarios. The company has enhanced its customer service by increasing the level and frequency of productive contact with its clients and by ensur-

CXO. How can I make web conferencing work for my business? BC. Easy-to-use collaboration tools are key to successful web conferencing, and the right service can bring your online meetings to life. The ability to visually share your computer screen with anyone and from virtually anywhere helps contribute to making your meetings very productive. For example, you can work with a colleague who is based at home, in another office, or even at the airport, to create a presentation together in real time. You could also present a new concept to a time-pressed business prospect that is hard to pin down to a face-to-face meeting, or train customers in real time by demonstrating your products and services to them no matter where they are located. Web conferencing gives you the flexibility and convenience to show documents and presentations from your computer as part of a scheduled meeting, or on-the-fly during phone conversations. In addition,

online meeting tools enable your colleagues to show the contents of their own computer screen during the same collaborative meeting. Electronic drawing and annotation tools like highlighters or arrows, combined with the ability to easily switch back and forth between presenters makes for a truly interactive and productive discussion. CXO. Can web conferencing really save me money? BC. There are several ways that web conferencing can deliver cost beneﬁ ts back to your business. Firstly, by cutting travel expenses by reducing the number of visits made to clients, suppliers or new business prospects. Web conferencing has proven to be invaluable to Backup Technology, a UK-based provider of backup, disaster recovery and business continuity solutions, by ensuring they can maintain regular contact with a global client base without having to rely on face-to-face meetings. The sales team can also pitch to new prospects virtually, which has been instrumental in winning notable new customers. The more advanced web conferencing tools also enable VoIP, which doesn’t cost anything for your own employees or other participants. It’s also an ideal way to allow your meeting participants to join your online meeting the instant they start the internet session, reducing time spent dialling telephone numbers and passcodes. In addition, opting for a web conferencing tool delivered via the software-as-a-service (SaaS) model is an ideal way to manage costs. Be sure to look for ﬂat-fee pricing that enables users to hold as many meetings as they want, of any length, without any overage charges.

Brett Caine joined Citrix Online in 2003. As President, he has inspired the company to adopt a strong customercentric focus that penetrates all aspects of the business. His vision is to consistently deliver simpler, better ways to help people connect and collaborate online using the company’s expanding line of software-as-a-service solutions.

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ASK THE EXPERT

CXO asks Geir Olsen about how TANDBERG is helping companies to slash costs, make faster decisions and improve staff productivity in an era of economic instability.

Decisions on the go

CXO. Are ﬂuctuating fuel and travel costs the main factors driving companies to utilise telepresence technology? Geir Olsen. The cost of fuel is a major factor that has companies looking for solutions to stay connected and efﬁcient while reducing travel budgets. This is a big challenge as face-to-face interaction is so important in business for building rapport, and generating trust when making important decisions. However, pressure to reduce travel and misaligned schedules can mean missed opportunities in fast-paced times. The beauty of telepresence is that it creates an immersive ‘across the table’ meeting experience and no travel is required. With TANDBERG Telepresence T3, you can hold a face-to-face meeting with colleagues in London, Dubai and San Francisco without losing a day to business travel. For example, Vodafone saved themselves over 3400 business trips in 2007/2008 by using video and teleconferencing. But travel and fuel costs are not the only driver. To maintain a competitive advantage, companies must be able to quickly respond to changes, strategise and deliver products and services to the market before someone else beats them to it. With the globalisation of business, decisions increasingly involve people based in other countries. TANDBERG’s immersive telepresence solution can bring key decision makers together instantly, no matter where they are, and enable them to work together as if in the same room. Lastly, many companies, including HSBC are looking to green technologies, such as telepresence and video, to help them reduce their carbon footprint.

into the atmosphere in 2007/08. Not only is this good for the environment, research shows customers prefer companies with reputations for being environmentally responsible, and employees prefer to work for green companies. So, using telepresence

CXO. So telepresence and video can help organisations achieve their green agenda as well? GO. Absolutely. By utilising video and teleconferencing facilities, Vodafone prevented 17,388 tonnes of CO2 from being emitted

and video can positively impact a company’s brand value. Let’s also remember – taxation on carbon emissions is coming. So every business trip replaced with telepresence will bring beneﬁts from reduced costs.

CXO. There seems to be a long-standing view that telepresence is just for the elite, or top level executives. How do you respond to this belief? GO. Being nimble requires more than decisions at the top. It takes an entire organisation heading in the same direction. With TANDBERG Telepresence you can invite your experts, suppliers and frontline employees into a telepresence meeting at a moment’s notice - from wherever they may be - by connecting anyone on a standards-compliant video conferencing system. CXO. How quickly can these systems pay for themselves? GO. TNT have just completed detailed research which calculates their breakeven point (payback period) at 2.3 years after deployment of video. In other cases TANDBERG customers prove that telepresence and video conferencing can pay for itself in less than 12 months.

Geir Olsen, is President of sales and operations for EMEA at TANDBERG. Previously he has held sales positions within TANDBERG leading the Southern and Central European regions. Prior to joining TANDBERG in 2003, he worked for McKinsey & Company, Inc. as a member of its Leadership Group for Financial Services. Olsen graduated with a Master’s degree from the Norwegian School of Economics and Business Administration with a co-degree from UCLA’s Anderson Graduate School of Management, specialising in international finance and economics.

CXO. Tell me more about the new TANDBERG Telepresence T3 system? GO. The TANDBERG Telepresence T3 creates an experience that is personal and comfortable while meeting the highest executive standards. The development team, including a social anthropologist, collaborated with customer groups to evaluate preferred designs, colours and room set-ups to optimise the user experience. Blue walls - the color of the Nordic sky - and specialised room lighting create a natural appearance, accented by warm wood walls, aluminum and glass to provide an exclusive ﬁnish. The design works in tandem with innovative technology invisible to the user. Large full HD screens and PrecisionHD 1080p cameras, which are positioned for direct eye contact, ensure that participants appear as if they are meeting in person. Integrated touch-panel screens make it very easy to use.

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ANALYST VIEWPOINT

The new breed of web and video conferencing tools now offer improved price performance while delivering a high quality experience that includes high definition video, live chat, and rich multimedia experience. Telepresence, considered the high end of the conferencing market, offers an immersive visual communications room where participants can have eye-toeye contact through use of multiple large video screens, careful design and implementation of furniture and critical audio video sub systems. Cisco and HP are positioning telepresence as the wave of the future, pouring millions of dollars into development and marketing. Attractive ROI offered by the current crop of conferencing tools will serve as a big driver. Audio, web and video conferencing usage is expected to go up as a result of massive layoffs and a hiring freeze Roopam Jain, Principal Analyst for Unified Communications at that will require workers to do more with Frost & Sullivan, explains how communication technologies are less, an area where conferencing and colhelping companies to get through difficult times. laboration investments are immediately justified. As IT budgets across enterprises conomic conditions around the globe and rising environmental of all sizes get slashed in preparation for a tough 2009, conferencing may be a concerns are creating a groundswell in demand for collaboration. business that will help ride through the economic downturn, bringing identifiAs organisations look at ways to survive during the recession, cost able cost savings to companies who deploy it. control is becoming a top priority. To fight the economic headwinds, several businesses have put strict travel mandates in place. Going green is big Business travel has already experienced the biggest nosedive in five years acBesides the economic downturn, another factor that has thrown the cording to the International Air Transport Assocation. While fuel prices have limelight on conferencing is green initiatives. Environmental, social and good come down significantly over the last few months, a bigger push to reduce governance policies are driving end users as well as IT to have a big focus on travel costs and a sustainable interest in reducing carbon footprint means peoadopting green products. While green is not a new subject, the amount of atple are looking to communicate and collaborate by tention it has received throughout this year is unprecealternative means. dented. The green movement is having a viral effect with Since joining Frost & Sullivan in August 1999, companies making new announcements to increase Roopam Jain has completed several A high growth industry their commitment to green, nearly every day. Concerted research studies and consulting projects on Conferencing technologies have received efforts in the future to reduce dependence on foreign oil audio, web and video conferencing markets. increasing attention over the past few weeks and increasing energy efficiency will continue to bring She also tracks developments in the fast and months. Revenues from conferencing sysforth the advantages of using conferencing by traveling evolving Unified Communications market and tems and services, a US$6.6 billion industry, less, working remotely, and reducing pollution. its impact on real time collaboration. Jain has are forecast to reach US$11.9 billion in five Conferencing and collaboration vendors are bankreceived acclaim for her research through years. The overall collaboration industry has ing big on the bottom line impact the technology has on articles and quotes published in Business received a boost from recent macro environthe environment. The combined effects of vendors pushWeek, CIO, CNN Money, Dow Jones News ment factors – globalisation, the ongoing reing the green benefits and the impending arrival of regService, InfoWorld, IT Week, Network World, cession and a rise in remote workers. Use of ulations for energy requirements is making this a hot Newsweek, PC World, USA Today, and Wall conferencing can have a direct impact on retopic for corporate governance and for end users that Street Journal. ducing travel costs while increasing efficiency. want to proactively contribute to the environment. Implementing solutions such as web conferHowever, the label ‘green IT’ can become hyped and encing, video conferencing and telepresence allows people to hold overused by vendors as a way to push new products and services. meetings in real time over IP networks letting them share data, ‘Greenwashing’ will become a concern among users. Customers will keep PowerPoint slides, live video, and audio. an eye on companies that are talking the talk not walking the walk.

CUTTING COSTS THROUGH CONFERENCING

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INDUSTRY INSIGHT

Maintaining business continuity as data centres transform By Paul Congdon, HP ProCurve CTO and HP Fellow.

or enterprises today, the data centre is the epicenter of business. But what do you do when this crucial nucleus is in a state of flux? With the convergence of storage and data on the same networking fabrics, it becomes more difficult to diagnose and troubleshoot issues involving the ways in which business information flows. We need to be more wary of how to mix traditional data traffic with SAN and realtime streaming media. As new technologies get implemented and intertwined in the data centre, visibility becomes more challenging. Take data centre network automation as an example. Network automation lets an enterprise

“Visibility means collecting and filtering the right kind of data to allow for trends analysis to find high-risk areas” do more with fewer resources, which frees up personnel to focus on activities that contribute directly to business growth. But automation means dynamic conﬁguration of network resources, and it requires impeccable network security, audit trails for change management and expert systems for automatic conﬂict resolution. As more functions are automated, can you detect the impact on the network? Is your network infrastructure still secure, or have you inadvertently opened potential avenues of breaching by viruses or unauthorised users intent on accessing confidential information? Are the physical network pipes that were provisioned still adequate for the new flows of business information? Can you predict provisioning

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Despite the potential of virtualisation, however, there are caveats. Virtualisation intensiﬁes the integration between compute and networking resources, requiring a delicate balance between utilisation and uptime. You need to design your virtualised solutions so that mission-critical applications don’t collide with nonmission-critical applications, and that secure applications are shielded from the impacts of open applications.

Thinking ahead

and resource placement in an automated environment of dynamic configuration? When you add a new technology or resource to the network, do you have visibility into the results? Or are you operating blind, which is a recipe for disaster? Another important technology to consider is virtualisation, of which network automation is a key component. By increasing utilisation of physical assets along with the ability to share resources with other locations, virtualisation can reduce the pressures for physical space, power and cooling in the data centre — all of which leads to lower costs.

Paul Congdon is Chief Technology Officer of HP ProCurve Networking, as well as an HP Fellow. He is responsible for specifying, architecting and designing ProCurve network infrastructure and software products and he heads ProCurve’s worldwide security strategy. He has over 20 years in the networking industry, and has become widely esteemed as an inventor and leader in driving networking industry standards.

I suggest making visability a high priority in your data centre networking design and planning to ensure you have the right level of visibility to be both proactive and instantaneously reactive. Visibility means collecting and ﬁltering the right kind of data to allow for trends analysis to ﬁnd high-risk areas. It also means honing in on and eliminating a source of trouble before it breaks your business continuity. How do you achieve this kind of visibility? Unfortunately, it’s not as simple as buying some kind of ‘ultimate data centre visibility tool’. Visibility into data centre networking depends on your entire network infrastructure design, combining sensors integrated into your network, and the collector of information that centralises it. sFlow is the leading packet sampling standard to help you achieve that level of visibility. HP ProCurve supports sFlow across its wired and wireless networking portfolio, as well as network and security management solution. By all means, explore the exciting new technologies that will take your data centre operations to the next generation. But be wary of potential new failure domains, and make sure your greatest IT asset — your staff — is not one of those failure domains. Keep things simple and work with a partner that provides great visibility into underlying operations. Minimise your chances of problems by making smart network infrastructure planning an integral part of your data center initiatives. n For more information on sFlow and network visibility, go to www.sflow.org.

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SECURITY FOCUS

MEET THE GATEKEEPER

In a short space of time the role of Chief Information Security Officer, or CISO for short, has risen from the back office to the boardroom as organisations look to protect themselves from a myriad of threats and adhere to compliance laws. CXO catches up with Ben Smith, CISO of investment management firm BlackRock, to see what’s top of his agenda. CXO. You are BlackRock’s first CISO. Why was the role created? Ben Smith. After 9/11 it was decided that a technology risk management position should be created. So the current head of technology, which included security and disaster recovery, was moved into risk management. From 2001 to 2006 the position grew into a role too large for one person so someone was brought in to head up disaster recovery. Also, in 2006, Merrill Lynch took just under a 50 percent stake in BlackRock so the role became too big for a head of technology risk and the decision was taken to carve off the role of CISO. I ended up being the person to fill that role. CXO. As a CISO, there’s a very real danger of only seeing symptoms and not the causes. How do you overcome this? BS. Security moves month to month and many of the changes require significant investment in people or in technologies. If you asked people three years whether they encrypted laptops and/ or restricted or encrypted USB storage devices the answer would have probably been no. Technology did not exist in the past to do these things but now everyone does it so you have to keep up with where the industry is moving. This is where we have to invest our dollars and our resources to protect ourselves so we’re not the next newspaper article on the front page of Wall Street Journal. Being in the asset manager business, our reputation is very important so you can’t just think of it in financial terms. CXO. What are the greatest risks that you face from an information security standpoint? BS. As an asset manager, we manage a lot of money on behalf of our mostly institutional customers and so if someone were to access our information and guess our trading strategies, that could give us a competitive disadvantage on the net market. We also have multiple roles; not only are we trading assets, whether it be fixed or equities or real estate or alternate markets, but we have taken our risk position software and our front office and middle office trading application and we sell it as a service. So not only do we have our trading information, but we potentially have a competitor’s trading information, so I have to make sure that I have two user communities and that the twain never meet. So we do things like make sure databases are separate. I have to prevent information being lost and customer information being leaked to their competitors. It is important

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that I convince companies that we have the appropriate security precautions in place in order for them to trust us with their money. So I deal with information loss and reputations loss. CXO. The challenges in information security risk management are still fairly immature compared to loan risk or credit risk, for example. How do we move down the maturity curve? BS. Part of the problem of information security is the changing threats. When I got into this industry in 1994 we didn’t know what firewalls were. I was working for the US military at the time and I was asked to go and investigate what a firewall was and select one but now we have firewalls and antivirus solutions on every machine. Nowadays, we have phishing but the industry matures so fast; as a new technology develops, so do the attack factors. Threats are evolving all the time and there are new vulnerabilities that you have to consider – what worked today is not necessarily adequate for tomorrow. CXO. How much of a stumbling block are new technologies in customers’ minds? BS. It is not so much of an issue for us because we don’t have too many retail customers; it’s mostly institutional customers. They are fairly mature in understanding what the risks are and what is changing. Change costs money and our customers encourage us to change faster than we want to. I think that our customers are more drivers of our change in some ways than hindrances to our change because in the end, they really want to protect their data to make sure that it is not used for inappropriate lessons.

install code behind the firewall. In the case of phishing, they [fraudsters] are targeting you via your consumers with a piece of information that looks like it comes from your company. The consumer finds it hard to determine what is real and what isn’t because the problem is that many people are inherently trusting. The phishers take advantage of those people who are not paranoid and think, ‘Why did I get an email from eBay when I didn’t purchase anything? Why does eBay need to know my account information again – don’t they already have that’? A security professional would just throw it out as spam but the consumers click on a link because they think it is the right thing to do. “People need to act appropriately and not be as easily fooled and we need to use technology to try and detect patterns of behaviour.” CXO. You could argue that firewalls are redundant because people can come though the various ports anyway. Does the whole notion of security need to change? BS. The notion of security changes as new technologies come along. We have always had defence solutions like antivirus software and spam filters, and you try to prevent users from installing software so you hope that these multiple solutions will catch any problems. However, technologies rapidly evolve so the solutions need to do the same. Also, the generation of computer users today expects to be able to plug their iPod into a work computer to charge it up for the train journey home. But this is a foreign device attached to your computer so you have to look at mitigating these risks. If you go too far down a restrictive path your best and brightest will go and work elsewhere because the controls to protect the business are so repressive. Even if you make the controls really hard, people will still try and get around them so you have to incentivise your staff to do the right thing.

“People need to act appropriately and not be as easily fooled and we need to use technology to try and detect patterns of behaviour”

CXO. How much is security about people and processes when it comes to threats like phishing? BS. In this day and age, the idea of a security perimeter has been diminished. You click on a website and it starts executing code behind the perimeter on your machine. Consumers could click on a link in an email or

PHISHING FACTS More than 60 million phishing emails are sent everyday around the world 3.6 million people lost money last year to phishing scams worldwide 40% of phishing sites are hosted in Asia Sources: Anti-Phishing Working Group, Trend Micro and BoxSentry

CXO. Organisations often have to manage a global workforce. What challenges does this throw up? BS. Globalisation has issues around privacy laws because how do you run a global business when you are restricted to personal information? You could have the one HR database in the US but how do you get UK citizens’ information to US in a way that doesn’t make the EU unhappy? You have to have two databases – one for the UK and one for the US. In the US it is very common to do background checks on a person’s education, past employment, criminal records; we can even do a drug test. The check can be nationwide, state or local. However, in Japan it is considered an insult to do a criminal background check so how do you know that you have not hired a criminal who will not pay attention to the polices? I would say it is hard to minimise your risks when hiring people within a global organisation.

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ROUNDTABLE

UNDER LOCK AND KEY

IT security has leapt to the fore in recent years but it’s still a mammoth area to get to grips with as organisations’ boundaries become less defined and harder to defend. We hear from Absolute Software’s William Pound, Finjan’s Yuval BenItzhak and MyLaptopGPS’ Dan Yost about today’s hot security issues and the pitfalls you should avoid.

William Pound is the VP of Global Corporate Development at Absolute Software. He has 25 years of experience facilitating international business for developing strategies to move new products into foreign markets. As a Canadian Trade Comissionser for 18 years, Pound supported the business development for hundreds of companies in Europe, Latin America and the Middle East.

As CTO of Finjan, Yuval Ben-Itzhak has over 15 years of high-level management experience. He was the founder and CTO of KaVaDo Inc., CTO at Ness Technologies and senior project manager at Intel Corp. BenItzhak was selected as InfoWorld's ‘Top 25 Most Influential CTOs of 2004’ and Computerworld’s ‘40 Innovative IT People To Watch, Under the Age of 40’ for 2007.

CTO Dan Yost joined MyLaptopGPS in 1999, specialising in system automation, network security and application development, including a satellite-based GPS telemetry concept system for the USDA. Yost addresses various business groups and associations, on mobile data security and privacy protection.

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CXO. Protecting information and confidential data is paramount today. What challenges are organisations facing when it comes to security? William Pound. The biggest challenge that organisations face is actually understanding exactly what they have got to secure. We believe that you can’t secure what you don’t manage and you can’t manage when you don’t know what you have. How many organisations know what company information is saved and where, but they have absolutely no visibility of where their physical assets are located? In today’s mobile world, those assets contain more data and are often outside of normal ‘in-security eco-systems’. Yuval Ben-Itzhak. Many organisations are still relying on signature-based security solutions, such as anti-virus and URL filtering, to protect their information and confidential data. However, traditional security solutions are signature and reputation-based; designed to protect against known threats that are static by nature. Traditional approaches of identifying threats and issuing patches to protect networks leave a substantial window of vulnerability for

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data to be stolen. To heighten their infection ratio and minimise their detection risk, cybercriminals turned to dynamic malicious code for their attacks, thus avoiding detection by AV or URL-ﬁltering solutions. Cybercriminals embed their malicious obfuscated code not only on web pages in legitimate websites, but also in richcontent ﬁles such as PDF and Flash. These techniques set a new challenge for security solutions and organisations to detect and block dynamic malicious code in time, before the malware enters the corporate network. Real-time code inspection technologies were introduced to combat such new dynamic attacks.

ployees know, understand and comply with their company’s security policy. This is especially true with mobility when the assets and the data they contain are often outside of the office domain. YB. The evolution of security technologies started with the detection of known viruses and providing signatures. URL filtering provides protection against known malicious websites. Both security technologies are reactive. This leaves a window of opportunity for cybercriminals consisting of the time that a threat is identified and the time that a patch is available from the security vendor. Traditional security solutions were therefore not designed to pro-

“Vehemently resist the strong temptation to rely on one single whiz-bang technology, a supposed ‘silver bullet” Dan Yost Dan Yost. The challenges are many and significant, the toughest being rapidly diversifying databearing assets (laptops, smart phones, etc.), multiplication of attack vectors, ‘data sprawl’, and user non-compliance. There are so many endpoint devices now, it is significantly more challenging for organisations even to identify them all, let alone place solid controls over them in a timely fashion. Meanwhile, the criminals get craftier, and have more windows of opportunity. At the same time, the exploding volume of confidential data creates a tsunami of risk. All of that data must be kept secure, and the bigger the ocean, the harder it can be to contain every drop. Worst of all, users resist necessary security policies. Our own team-mates circumvent the policies built to protect them, usually because the security technologies employed are intrusive and inconvenient. CXO. How has technology evolved in the past few years to ensure information and systems are secure and keep the criminals at bay? WP. Technology has grown in leaps and bounds over the last few years. Solutions like firewalls, encryption and anti-virus continue to provide added layers of security. We believe that Absolute Software’s embedded solution provides the ultimate layer of end-point security by enabling ongoing control of the device. However, security technology is only part of making sure information is secure. The other part is to make sure that em-

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tect against crimeware and Web 2.0 attacks using obfuscated dynamic malicious code. The security industry reacted with security products that offer proactive ‘zero day’ malware detection techniques by ﬁltering malware from all aspects of inbound and outbound Web trafﬁc. Such security products include real-time content inspection that provides zero-day protection against cybercrime and Web 2.0 attacks. It detects and blocks malicious inbound and outbound content based on the code’s intended criminal action, and doesn’t rely on signatures, URLs or reputation attributes.

reach and stability, but a key factor has always remained a challenge: users. Sometimes the keeper of the cookie jar leaves it open, due to laziness, negligence or rebellion. The best overall progress has been made by skilfully layering disparate but complimentary technologies, abandoning reliance on one supposed ‘silver bullet’, and doing so in a fashion that relies as little as possible on user cooperation. It’s very effective. CXO. As workforces become more mobile and devices get smaller and more sophisticated how can companies best protect defences? WP. Mobile devices, including phones, PDAs and laptops can be protected both physically and technologically. Asset management is a crucial foundation to any security structure. The challenge is to use that knowledge to maintain as much control as possible over those devices that, due to their simplicity, are often considered relatively harmless. Organisations need to take real responsibility for the data on their mobile devices, as their use becomes more common and the consequences of a breach are far wider than to just the organisation itself. To take responsibility there needs to be policy and traceability. Asset management is key to knowing who has a device and, if necessary, where it is. We believe this is particularly important if a device is lost. Not only can technology be used to trace the device and allow it to be recovered, but sensitive data files can be deleted, preventing it from being used maliciously.

“The average cost per data breach incident was estimated in 2007 at US$6.3 million” Yuval Ben-Itzhak

DY. Security technology solutions tend to be fairly reactive, responding to the latest attacks. When you want the cookies in the jar, usually you simply figure out a way to defeat the existing jar. The cookie vendor responds by building a thicker jar or a better lid, or decides that jars are indefensible and switches to boxes, and the cycle continues. Technology has evolved similarly. Encryption, tracking, deterrence, perimeter defence, biometric measures, and other methods have grown in their

YB. Data is one of the most valuable assets of today’s enterprises and includes critical business data, intellectual property and private information that is spread throughout the organisation on servers and desktops. Once data is transmitted, it is at a high risk of being misused or abused. Employees also use USB ports and CD writers to copy information, and use laptops and VPNs for working outside of the ofﬁce, which makes outbound data vulnerable. The optimal way to stop leakage of different types of outbound content is

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real-time content inspection. This technology is able to stop leakage of different types of outbound content. Even when a file extension is manually changed to mislead and bypass file type filters, real-time content inspection will block these files based on their exact file type. Granular rules can also be applied per user and per group for tighter protection of certain employees or user groups. DY. Vehemently resist the strong temptation to rely on one single whiz-bang technology, a supposed ‘silver bullet’. The day after a company pats itself on the back for a ‘silver bullet’ deployment, criminals just laugh as they discover how to duck. Devices will get smaller, more sophisticated, and more diverse – multiplying attack vectors. Companies must constantly re-examine their methods, always looking for more security layers to add, as unobtrusively as possible. It’s a never-ending job, and this must be expected. Companies who believe they can finally solve this problem and move on, not remaining proactive, are being dangerously foolish. And yet, that is what many companies do. By layering a large array of complimentary defensive technologies and wisely remaining vigilant, companies can truly win – and we’ve seen it. CXO. A breach in security or loss of confidential data can be catastrophic – not only the potential financial loss but also the knock-on effect of damage to reputations and the brand. What advice would you offer for a quick recovery and for ensuring lessons are learned? WP. Organisations need to have a clear process to follow if an incident occurs. But also, we cannot legislate for human error, and a lot of data breaches and data loss cases are down to policies not being followed or, as an example, employees leaving their laptop in the back of a taxi. In this situation, it is important for an organisation to act responsibly and take every possible measure to minimise the impact. If tracking software is installed and activated on mobile devices, it means that as soon as the loss is reported, sensitive data can be deleted – or even retrieved – from the lost device. Not only that, but it can be traced and then recovered by the local police. It means that there is real damage limitation, rather than not knowing until it is too late whether the sensitive data has fallen into the wrong hands.

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YB. Successful data breaches can result in the following: loss of existing customers; difﬁculties in acquiring new ones; loss of intellectual property; loss of R&D data, product designs, road maps; brandname and corporate image damage; negative impact on competitive position; loss of market share; potential lawsuits; non-compliance with rules and regulations; loss of productivity due to downtime, investigations, and damage control. The average cost per data breach incident was estimated in 2007 at US$6.3 million; the cost of lost business per incident at US$4.1million. In most reported cases, breached companies relied on traditional security solutions for protection. To regain their reputation, organisations are advised to inform their customers and stakeholders that they are implementing a comprehensive multi-layered security solution, such as real-time content inspection. This way, they can guarantee that each and every piece of inbound and outbound web content is analysed and blocked based on its intention, and not on its origin or form.

“Asset management is a crucial foundation to any security structure” William Pound DY. Notify quickly, and be ‘pre-diligent’. The most common and intense criticism of the many breached organisations, bar none, is failure to quickly notify the victims. People have remarkably extreme expectations about how fast notiﬁcation should occur – reasonable or not. By very quickly and thoroughly rectifying a problem, a company can forge extremely loyal customers – even more loyal than if a problem had never occurred. This will never mean that a breach won’t still cause some customer bleed, but a slow response is a backbreaker. The second most damaging post-breach factor is actually a lack of diligence pre-breach. Avoid ever having to announce that a breach occurred and no serious steps had been taken beforehand to secure the data. Thousands of companies have suffered both mistakes. CXO. How are your products and services helping your clients today? WP. Absolute Software’s ﬂagship product in EMEA is ComputraceOne, an asset management, tracking, data protection and recovery solution for mobile devices. We have partnered with the

world’s largest manufacturers of laptops and other mobile devices to help some of the world’s most data critical businesses avoid becoming the next data loss headline. We have over 3.4 million subscribers globally and our software has helped to track and recover literally thousands of mobile devices across the globe. We have deleted tens of thousands of ﬁles remotely after a theft or loss and broken up major crime rings and internal thefts. ComputraceOne is a proven solution that gives companies real peace of mind that if they suffer a breach, they can very quickly close the door on any potential malicious use of the data. YB. Utilising patented active real-time content inspection technology, Finjan's award-winning appliances prevent Crimeware and other malicious web content from inﬁltrating corporate networks and stealing business data. Finjan’s secure web gateway solution analyses each and every piece of web content in real-time, regardless of its original source, and understands its potential effects before it executes itself on the end user machine. By understanding the true intent of web content, Finjan’s active real-time content inspection technology detects and prevents crimeware despite the propagation techniques and anti-forensics methods in use. This prevents any malicious web content from entering the corporate network, thus protecting enterprises from crimeware that may result in severe business damage. Finjan’s offerings also include advanced applications, such as: policy management; integrated cashing and security; enhanced auditing and reporting tools; and integrated data leakage prevention (DPL). Multiple protocols, ports and applications are also supported, including IM, P2P, Flash and streaming video. DY. We practise what we preach, and that means layering. Our special six-layered approach never relies on a supposed ‘silver bullet’ and it has yielded the best theft rate in the business: 0.4 percent, 32 times better than the average. We help our clients analyse their current security practices, how our features will integrate with them, and what the resulting strengths will be. We examine how other layers they may already be using can be bolstered or enhanced. Our clients have widely varying goals, and we are helping clients by applying extremely effective features and knowledge to meet their particular goals, not by offering a canned solution based on our own goals.

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SECURITY FOCUS

joined PayPal about two and a half years ago. When I got here, I think it’s fair to say that the company had a financial strategy that resulted in very low fraud rates online, expressed as a percentage. But by fixating on the financial strategy, we created something of a rod for our own back. Essentially, in making our fraud models as efficient as we had, we seriously impacted the criminal’s ability to make money. If you are a criminal and you’re not making as much money as you want to out of phishing, what do you do? The answer is you generate more phishmail. We realised that our strategy, while it was financially effective, was generating a negative user perception, particularly among low-transacting PayPal users. Their experience of our brand was essentially the one of having phishmail in their inbox. It generated what most PayPal employees refer to as the ‘cocktail party problem’, which is to say you go to a social event and

people ask, ‘Who do you work for’? You say PayPal and they always ask a question along these lines of, “When are you going to stop sending me those fake emails’? So in the summer of 2006, we realised that this was a significant issue. At that point, we re-strategised how to deal with phishing and came up with a very coherent and integrated plan that we now have substantial evidence is working. The first thing to remember is that there is no silver bullet. There’s no single solution to phishing that you can look at and exclaim, ‘Oh, my goodness – why didn’t we think of that three years ago’? As far as we can tell, no such thing exists. Rather, it’s the standard information security approach of devising a series of defensive layers and putting the right investments into each layer. Any given layer may only have a certain amount of impact, but taken collectively, they have a big impact on the crime. The first point is user education. At this stage we now have substantially more than one billion users on the internet, and probably half of them have come on in the last five years. They’ve had no formal education about what represents safe behavior and what doesn’t. Our view is that it isn’t just us, but also the rest of the industry that needs to be in this for the long haul, trying to educate and make sure users understand how to protect themselves.

Fighting back PayPal CISO Michael Barrett explains how the online payments giant is shutting out fraudsters and why the war on phishing is winnable.

“We have substantially more than one billion users on the internet” The next basic hypothesis is that if a phishmail doesn’t arrive in a consumer’s email inbox, it’s rather difﬁcult for the criminal to victimise that particular individual. We started thinking about strategies to prevent phishmails arriving in inboxes, and we rapidly arrived at the notion that there was some good technology that had been around for a long time but had got tied up in the inevitable industry standards war. In particular, the whole concept of email signing. We’re pretty pragmatic at PayPal, and so we decided that if the industry can’t agree on a single protocol we’d just use what’s out there. We’d rather use one, but we’ll certainly handle two. Since Christmas 2006, we’ve been digitally signing all of our outbound email using both SPF and domain keys initially, and we’re now switching to Domain Keys Identified Mail (DKIM). The problem with digitally signing in its own right, is that even the boffins rarely check digital certificates, and nobody else even knows what one is. While you can be happily signing emails, it doesn’t do you any good if con-

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sumers don’t actually know how to look at that information. So rather than just using signing on its own, we saw that it really made sense when delivered in the context of blocking. We started working with ISP’s because there’s about half a dozen of them that make up about 50 percent of the world’s email addresses. Those are the usual suspects: Yahoo, Gmail, AOL, MSN, Hotmail and so on. Because that’s a fairly constrained set, we’d be able to essentially test this whole idea of email signing and blocking with them, and if it worked, we’d continue rolling it out. We announced blocking with Yahoo several months ago and we announced blocking with Gmail more recently. The results are acMichael Barrett tually pretty unequivocal. Since we’ve announced the partnership, we’ve blocked 85 million emails from consumers’ inboxes. That’s 85 million people who didn’t get victimised through that channel. The next layer in the strategy is one of stronger authentication. What we’ve done is implement a PayPal security key. So far, it’s been rolled out in the US, Germany and Australia, but we’re in the process of rolling it out globally. At this point, the classic form factor is the token one where you press a button and it generates a six-digit code that is transformed every 30 seconds. You just attach the thing to your key ring and as long as you’ve got your keys with you, you can always access your PayPal account through it. The advantage is, if you ever get your account phished and the credentials are stolen, it isn’t as easy to log on without that security key, so the bad guy wouldn’t be able to take your account over. In the years since we first deployed it, we’ve essentially discovered that fraud on security key protected accounts is pretty much zero. From a usability perspective, you can still get in if you don’t have your security key with you, but you have to go through the secret question-and-answer process. We think that for those consumers who are really worried about security, it’s an excellent tool because it gives them much more control. We’re also experimenting with different form factors. The next one out of the door is in fact not going be a physical security key at all but rather will be a couple of different approaches. One is downloadable software that you can run on a smartphone. Alternatively if you don’t have a smart phone, we’ll simply SMS a message to your registered mobile phone with a one-time code when you want to log on. We’re always working with policy makers globally on, not just funding for law enforcement for cyber crime globally, but also to harmonise legislation so that there is a very similar framework on a global basis. Because culturally it hasn’t been that long since we were a startup, we’re prepared to take risks on things. We’ll try stuff, and if it works, great. If it doesn’t, we’ll try something different. While we’d love everything we did to work, there are times when you place bets and you don’t win. I think we have more tolerance for taking those kinds of risks,

and I also think we have more tolerance for actively making ourselves heard. I’ve spent most of my career in financial services, and one of the things I’ve noticed is that this company is a lot less shy about getting out there and lobbying, not just for its own good but on behalf of the industry overall. We’re absolutely prepared to get out there and work with the rest of the industry. This strategy is proving very effective. It’s taken us from being in the top 10 most phished brands list on a regular basis in 2006 to a position where, most of the time, we’re no longer there. What we believe we’re seeing is that our brand is being phished less. Unfortunately, we don’t believe these bad guys are taking up legitimate jobs and are now gainfully employed rather than simply victimising other brands. But we believe that our strategy is what made the difference and the corollary to that is everybody else needs to adopt this same broad set of strategies. If they do that, we actually can start really choking down on the crime of phishing. People have a tendency to say, ‘Woe is me, phishing is insolvable’. We think that’s just way too defeatist and that actually the problem is surmountable. Education, technology and industry partnership will be the answer to the phishing problem. By partnership, I mean standardising these things and the industry coming together to agree on approaches. Every company doesn’t have to implement everything we’ve done, but if every company implements a few of them, then collectively it will make a signiﬁcant difference. Additionally, collaboration with law enforcement and government will have a huge impact. It’s going to require a blended strategy.

21ST CENTURY EDUCATION One of the things we’ve discovered is that just boring old text on web pages isn’t necessarily the best way to educate consumers. For instance, we’ve tried quizzes, and they work fairly well. There’s also some academic research that says cartoons work really well. We’ve also tried video, and video actually works very well for certain kinds of problems. Heres an example. Phishing’s relies on the fact that consumers don’t understand how to parse a URL and don’t know what a domain name is. In the tech industry, we find that problem remarkably easy, but the average consumer doesn’t. It’s really difficult to describe that in text but remarkably easy to show somebody on a screen. We slung together a video of that and stuck it on YouTube, and it’s actually quite popular. If you’re going to do consumer education, you have to think outside of the ‘text on web pages’ paradigm.

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ACRONIS ATE:nov08 03/12/2008 14:34 Page 96

ASK THE EXPERT

Calling time on downtime Laurent Dedenis, VP International Sales and Managing Director of Acronis, explains how companies can protect themselves in the event of email downtime.

icrosoft Exchange is one of the most used ‘filing cabinets’ in today’s office, where meetings are scheduled, documents are shared and business is conducted. Over 170 billion emails are sent worldwide every single day and since its birth in 1971, email has become an everyday part of all of our lives. But how much would you lose in productivity and revenue if even one of your Exchange servers went down? Recent estimates indicate that more than three quarters of businesses’ critical data is stored on emails. And while email is a mission-critical application for all businesses, it is one which is subject to failure, often turning a company’s operations upside down. In fact, most businesses suffer email downtime for a significant duration at least once a year. And many suffer it more frequently.

“More than three quarters of businesses’ critical data is stored on emails” In order to mitigate the threat of email downtime, companies need to set out a defined strategy addressing what to do should it happen. This should include advice for users and SLAs of the IT department, a recommended approach for communication to clients and a clear delegation of who is responsible for each step of the recovery process, ensuring that emails are back up and running again as soon as possible. The strategy should also pinpoint the main causes of email failure, and address how to deal with each type of downtime challenge. Although floods, fires and other forms of natural disasters dominate the news, the most likely disruption to an email server will be of a technical nature – per-

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haps losses in network access, the threat of viruses or a database corruption – or most likely a human error. It is vital that firms protect themselves against run of the mill threats as well as preparing for natural disasters. One of the major problems with email downtime is that it’s so visible. Customers know when your emails are down. Likewise, the CEO will want to know why he can’t send emails. In fact, the most common questions asked in a time of email downtime are, ‘How fast can I recover my emails?’ or ‘When will the server be back up and running again’? The first minute of email downtime causes an inconvenience, the first hour becomes a problem and if downtime goes on for longer than four hours you might as well send everyone home. Therefore, the pressure to recover emails as swiftly as possible is paramount. The speed of recovery is another key issue which needs to be addressed in the strategy for dealing with email downtime. Not only does the IT team need to ensure that emails are back up and running as soon as possible, but it also needs to consider a granular approach to recovery. For example, if the senior attorney in your organisation’s legal department calls and asks to recover a former employee’s mail

box for a pending court case it is vital that you can recover that mail box as a priority. Indeed, it would be ideal to drill it down to the one email record which is needed for use as evidence in court. Taking such a granular approach ensures that a company’s most important mail messages can be restored as soon as possible and can be prioritised before less critical messages are recovered. In a 24/7 global environment, where people are active all the time from around the world it is vital that emails stay up and running in order for business operations to remain smooth. Companies all too often focus on their backup strategies without really thinking about how they effectively recover their IT systems. Just because you have a backup policy in place, it does not mean that a company is immune. Most companies only test their recovery solutions once a year. Testing needs to be much more frequent in order to ensure that emails are protected and it’s important that a procedure for addressing the recovery of your emails is established. Emails are fast becoming the most important documents which a company holds. With them containing intellectual property, HR details, customer information and sales strategies, among many other assets, it’s vital that a business has a successful formula for ensuring that emails can be effectively and rapidly recovered at any time of the day. n Laurent Dedenis, VP of International Sales and Managing Director of Acronis, has over 15 years’ experience in start-up management across the United-States and Asia. Responsible for Acronis’ international operations and for driving growth in EMEA, Dedenis oversees the distribution strategy, sales and marketing as well as product localisation. He joined Acronis in December 2004, and was previously general manager of Microsoft Solomon Software Asia.

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451 GROUP:nov08 03/12/2008 15:04 Page 98

DATA SECURITY

SECURING THE FUTURE Nick Selby, Research Director for the 451 Group, reveals where the data security sector is heading.

ick Selby believes that the biggest point of pain for CIOs is identity management and access control. “By looking at identity and access management as a multi-outlet power strip and products that give it context, like web application firewalls and database transaction monitoring products, it is easy to see that the real challenge for identity and access management vendors is that as well as giving the who, they need to give the what, why, when and how of transactions between computers,” he says. Selby goes on to say that identity and access management will continue to be a hot topic for the next two to three years. “Companies that are able to provide products that give the ability to manage identities more effectively and at a more detailed level than what currently exists will find they have a pretty brisk take up.” However, it’s not just identity management and access control that cause headaches for CIOs; corporate governance and compliance remain very much on the front burner for most senior executives. Selby believes that the real problem executives face is that deployment of governance and compliance technologies is a reactive and not proactive process, which by its very nature is more expensive. He goes on to explain that both small and large enterprises can be seen buying products that are designed to address a specific, for example, auditing or compliance requirement. This leads to poorly thought out deployments and money repeatedly spent to solve the same problems. “Where CIOs must head over the coming three years, is to a situation where they are looking horizontally across their entire enterprise, and looking to

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legal experts for advice about industry and regulatory requirements, before ﬁnding a matrix of all the rules to which they must be compliant, and ﬁnding products that meet the vast majority of those,” says Selby. “Until that happens we will see a lot of money being spent on short-term solutions, tactically driven as opposed to strategically.”

“While much time is spent tying security to business processes as specifically as possible, risk is going sky high” Investment A recent survey of IT directors in Computer Weekly revealed that most believed current levels of security investment to be inadequate. Selby believes that while much time is spent tying security to business processes as specifically as possible, risk is going sky high. “The typical XY axis of security spend versus risk is out of the window when you take into account an increasingly mobile workforce and increased reliance on outsourced application development to untrustworthy third parties,” he says.

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There is no real way to look at the XY axis so that you can ﬁnd the ideal point of security spend versus risk, continues Selby, but what it is possible to start seeing is a greater understanding of security as an enabler as soon as security is tied to income. “You don’t want to hear that something isn’t possible from your security people. What you do want to hear is, if we were able to deploy X, then Y would become more lucrative. Enabling business processes is something that both security and business sides of the organisation can understand.”

23% of IP security professionals have taken measures to classify their data Protection Data protection is and continues to be a huge focus for companies worldwide, but despite this many businesses are not doing enough to defend themselves. Selby believes this is down to a lack of understanding of where data comes from and where data is stored in organisations. This is then followed by a lack of desire on the part of the C-level or IP employees to staunch the flow of sensitive data out of the organisation. The 451 Group recently did a survey of 391 IP security professionals and found that around 23 percent had taken measures to classify the data that reside in their networks. The problem is that if you have not classified where your data came from or what kind of data you have, you can’t protect it, except by encrypting everything. “The first step in data protection is understanding where your data come from and where it lives. The second step is to understand why the data is there. And finally, begin to classify, in as few buckets as possible, what kind of data you have. For example, is it public, internal, sensitive, regulated or non-disclosure,” says Selby. By making these determinations about the data, you can, in the future, make policy decisions about how the data can be used and what data can or cannot leave the building. However, until you make those first fundamental steps, any data protection initiative will likely be hopeless. It is the same first step for protecting sensitive data, claims Selby. By doing a basic analysis of where the data comes from it is possible to move on to the second step of looking internally and making yourself aware of how your data is moving internally. “If you follow the data you’ll see whether or not it’s a legitimate flow or whether, for example, it’s data flow

that has popped up in response to a poorly deployed security deployment,” explains Selby. “Once you have an idea of how your traffic is moving, the next step would be towards data classification, and finally, to policy management and controlling what data goes out.”

Future focus Selby believes that over the next 12 to 18 months virtualisation security and eco-efficient IT will have the biggest impact on the sector. “You can’t start to reap some of the benefits of power saving and virtualisation without dealing with virtual server and virtual endpoint sprawl,” predicts Selby. He believes that virtual network intrusion and threat detection is particularly exciting, as is the securing of visual endpoints by looking between hardware and the hypervisor, as well as within the virtual instance itself. Going back to identity and access management, Selby is keen to highlight that the sector should see some exciting developments. “Once you understand the context and begin to deal more with the problem of persona, the possibilities become very interesting.” n

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ESCROW INT:nov08 04/12/2008 08:09 Page 100

EXECUTIVE INTERVIEW

Fail to prepare and prepare to fail Burying your head in the sand when it comes to business continuity planning is just not an option today. CXO hears more about this critical function with industry expert Herman Meuldermans of Escrow Europe. CXO. In the current economic climate why is it so important to have business continuity systems in place? Herman Meuldermans. Escrow is a legal, technical and administrative arrangement in which an asset (e.g. source code) is deposited into safekeeping with a trusted third party – the escrow agent. If contractual conditions are met, the escrow agent will deliver the asset to the party prescribed by the contract, mostly the user of the technology. These days, trust between business partners tends to be institutionalised. In the past few months, we’ve seen that complex business relationships as we know them essentially are based on mutual trust. What happens if trust suddenly disappears? The thing collapses. Business partners still like each other, and want to continue doing business with each other. But they are careful; more than ever dependencies have to be secured. That’s exactly what we do. We could state therefore that the current economic climate is in favour of products such as ours, offering security and guaranteeing business continuity. CXO. What continuity challenges are businesses currently facing? HM. There are a lot of continuity challenges, of course. The one that’s very often forgotten, or that’s being thought of too late, is the dependency of a supplier. When it comes to IT systems or technology in general, this dependency can be very, very critical. As well as any other company, suppliers can win, can lose, and can fail in delivering the expected service. This can have very nasty consequences. Realistic suppliers are aware of their position and take pro-active action. Together with their service agreement, they offer an escrow contract to their clients. Thus they show themselves as reliable partners, they turn their weaknesses into a strengths. We help them to do this. CXO. What common mistakes do companies in Europe face when it comes to business continuity? HM. I wouldn’t call it a mistake, rather a lack of awareness. When it comes to continuity, a lot of company issues are almost naturally thought of. On top, of course, management teams think about ﬁnancial conditions, including shareholders’ perceptions. Production and service issues come

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next, followed by marketing and sales. People are important too and a huge effort is put in human resources programmes. In this context, knowledge management is very often also mentioned. All of this is administrated by huge and sophisticated IT systems, costing immense amounts of money in both development and support. Is continuity of this critical infrastructure assured to an acceptable level? Is there an escrow arrangement in place ? Even a company relying on its own personnel when it comes to IT or technology development is essentially dependent on them. If the team disappears, what happens to the knowledge of the system? Escrow services reach beyond the safeguarding of a depot. The technical team will always verify if the depot is what it’s supposed to be; the administrative support team will update the depot at least once a year, thus continuously guaranteeing maximum usability to the user. Whether technology is created internally or externally, due to the structured and updated verification service, continuous use of the system is guaranteed. CXO. What new challenges do you believe companies will face in both disaster recovery and business continuity going forward? HM. It is not disaster recovery as such, it’s merely the growing tendency towards personal responsibility of the management that’s challenging companies’ leadership. The worldwide financial crisis of the past months has also shown that top administrators are held responsible for bad performance, even if these results were mostly influenced by the overall economic

Herman Meuldermans, General Manager of Escrow Europe, holds a degree in Social and Political Sciences from the Catholic University of Leuven. He started his career as an account manager for ING Insurance in Belgium and later worked as a principal consultant for almost six years for a Dutch consultancy bureau. In this position, he did a variety of IT-related projects in insurance and governmental environments.

ESCROW INT:nov08 03/12/2008 14:51 Page 101

disaster. Nevertheless, many executives have been ﬁred, amongst them people who were very successful in earlier days. Personal responsibility within companies’ governance is a fact. It goes along with the aim of appointing a real person when it comes to issues that affect the broader community. Sarbanes-Oxley, ‘Corporate Governance’ and ‘Good Governance’ all call for establishing an internal system of checks and balances, from the evidence that a company does not just exist for its own sake, but very often has a much broader impact. Within the range of measures that can be taken to cover continuity risks, escrow services are an essential component. Escrow is an essential part of good governance.

“Within the range of measures that can be taken to cover continuity risks, escrow services are an essential component” CXO. Which types of businesses are most likely to face business continuity issues? HM. It’s hard to say. What I do know is that all companies keep on investing in technology in general and IT technology in particular in order to increase productivity. The possibilities of IT technology also keep on growing. It never stops. Technology not only Herman Meuldermans promises a seemingly endless growth of productivity, it also keeps on creating new opportunities. In the mean time, dependency grows. CXO. You talk a lot about dependency between users of technology and For example, the health sector has definitely discovered IT. With sothe suppliers of it. What’s the use of escrow services for suppliers? Aren’t called e-health infrastructure, care can be brought from the most hidden they considered to give away their intellectual property? place in the heart of Africa to the International Space Station. The working HM. Indeed we speak of beneficiaries when we mean users. If something concepts are the same. Suppliers of this technology very often have an acagoes wrong, they receive the deposit, including source code. But I don’t demic background, and the business is far from established and consoliagree with the statement that suppliers give away their intellectual propdated. In fact, it’s an entire new branch. We make it possible for suppliers erty. They don’t. On the contrary, they secure it by depositing it. to present themselves on the market. Regardless of their evolution, the Our contract very clearly states that the IP remains the property of the technology can be launched without any continuity risk. supplier, whatever happens. When a deposit is given to a user, he obtains On the other hand, we have a bank with an application that has lasted the right to further develop the source code for his – own purposes, nothfor years. For one reason or another, this application has to be modified. ing else and certainly no commercial objectives. A very significant penalty No one, not a single person within this bank, has any information on the is foreseen in the contract. system. Everything has to be investigated from scratch. If there had been Talking about the supplier, some advantages have already been menan escrow agreement in place, the latest situation of the source code would tioned. Perhaps first of all the sense of professionalism that a supplier have been documented and this would have saved tons of money. This demonstrates by pro-actively offering an escrow-arrangement. Secondly, bank now organises escrow verification for its most critical infrastructure ownership rights in the source code are reinforced, the supplier’s most every quarter of the year. Every business that is relying on technology valuable asset. Further on, the supplier reduces dependency on employshould seriously be concerned about its continuity, and should therefore ees and organises its disaster recovery. The world is ready for escrow serconsider escrow services. vices – let this be clear. n

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ESCROW CS v2:nov08 03/12/2008 14:51 Page 102

CASE STUDY

makes sure IT follows the evolution of the company and new requirements are met. Three things happen: The IT man leaves, the original ERP-package is no longer available and the modiﬁed technology reaches the boundaries of its capabilities. With no escrow service in place, production itself becomes uncertain, immature decisions and huge investments are necessary to cover the problem. All of these are simple but realistic examples of situations in which a good escrow service would be a perfect and very economic solution. Essentially, a software escrow service means the following: • Safeguard the depot containing source code • Veriﬁcation of the depot • Update the depot, at least once a year – software is a ‘living’ matter • Provide a sure, balanced and clear contract

Risky business A look at the impact of implementing new technologies on business continuity strategies.

T has technology has transformed the healthcare sector. With so-called e-health infrastructure, care can be provided from the most remote part of Africa to the International Space Station. The working concepts are the same. Suppliers of this technology very often have an academic background and business is far from established and consolidated. In fact it’s an entirely new branch. We make it possible for suppliers to present themselves on the world market. Regardless of their evolution, technology can be launched without any continuity risk. Investors can invest their money, knowing that at least the technology will remain if something goes wrong. On the other hand, there could be a bank with an application that has already lasted for many years. For one reason or another, this application has to be modiﬁed. No one, not a single person within this bank, has any information on the system. Everything has to be investigated from scratch. This means months of work. If there would have been an escrow agreement in

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“Most traditional escrow agreements are closed between three parties – user, supplier and escrow agent” place, the latest situation of the source code would have been present and documented, this would have saved tons of money. This bank now organises escrow veriﬁcation for its most critical infrastructure every quarter of the year. Every business that is relying on technology should seriously be concerned about its continuity, and should therefore consider escrow services. A starting company relies for its productionprocess on an ERP-package that is bought on the market. It is implemented and modiﬁed by an IT consultant. While business grows and the company becomes more complex, the IT expert

These four points are essential to what is called ‘active escrow service’. This distinguishes a professional escrow service from a simple notary-escrow, where nothing else happens other than registering a deposit, without any verification or update-service. Both suppliers and users must be considered as full customers. They both have specific needs that should be equally reflected in the contract. For the supplier, 100 percent securing of the IP and demonstrating a perfect quality service are dominant demands. The user asks for a continuity assurance that is as broad as possible. As the bank-case demonstrates this also means delivering a high qualitative and mutually agreed verification procedure that has the impact of a quality certificate. Nevertheless, most traditional escrowagreements are closed between three parties – user, supplier and escrow agent. The three parties have their own rights and duties, whereas the duties of the supplier follow immediately after the closing of the contract. The escrow agent has the duty to guard, verify and organise the follow-up of the deposit. The user can then be at ease and his continuity is secured. Nevertheless, the user has to respect the ownership of the IP and the efforts delivered by both supplier and escrow agent. Co-operation of the three parties is established for quite a while, that too is the impact of an escrow agreement. n www.escroweurope.com

Northeern.indd 1

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BUSINESS CONTINUITY

NEW DANGER The crises facing global financial markets offer a fresh perspective on business continuity management, says Lyndon Bird, Technical Director of The Business Continuity Institute.

n the second half of 2007, the world woke up to a whole new set of I can only conclude that this is due to the traditional distinction berules. The ‘easy’ decade was over and the credit crunch became the tween legitimate business risk and operational risk. To most executives, word on everyone’s lips. Terms hitherto the exclusive taking business risks is a good thing. Although excessive property of the financial world were suddenly in exposures need to be hedged and closely monicommon currency. Following the crash in the US subtored by middle office procedures, the whole prime mortgage sector, we began realising that things point of them is to make profits. Although we had never heard about were impacting our lives, events at France’s Société Générale business and personal finances. We were all soon falast year suggest that controls could miliar with such esoteric concepts as LIBOR rates, be better at times, no one suggests you lenders of last resort, securitisation, K adequacy and can run a successful investment bank systemic risk. We quickly learned that the interplay of without taking managed risks. these factors resulted in a shortfall of cash availabiliOn the other hand, operational risk is about ty globally. Commercial banks were sitting on their avoiding problems and is always seen as a funds and governments, while regulators and central cost. Either you spend money to reduce banks were almost powerless to influence them. the risk or you have much greater LYNDON BIRD Without liquidity in capital markets, many businesses costs if the risk is realised and you big and small suffered badly, and not all survived. haven’t. In other words it is a sort of inWhilst thinking about this, I pondered how many financial executives surance, a drain on the bottom line, not a would consider such things to be a business continuity issue. I would potential profit generator. guess very few. So why is this type of crisis not yet seen as a concern of Business Continuity Management (BCM), whereas losses resulting from computer failures, pandemics or terrorist attacks are?

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4 KEY BCM QUESTIONS I am ﬁrmly on the side of those who claim BCM does not cover normal commercial problems. It is certainly nothing to do with BCM if your products are uncompetitive or your management is uninspiring. However, it is everything to do with BCM if an ‘out of the ordinary’ event triggers a situation in which an organisation cannot meet its primary business mission. If I am a mortgage broker, surely lack of available mortgages in the market is a bigger threat to my business than loss of a computer system or head ofﬁce building? An example from the UK serves to illustrate my point. Northern Rock, a reasonable sized domestic bank specialising in providing private mortgages, finds that its lending policies are unsustainable as sources of credit dry up. News of this triggers a run on the bank, during which the UK government has to make guarantees to deposit holders and ultimately nationalise the bank to save it from administration. If this were a BCM area of concern, many things would have been in place. Single points of failure would have been identified (limited sources of funding), operational resilience would have been implemented (more diverse and less risky trading activities) and a clear recovery strategy developed and staff trained should the threat be realised. This would not have changed the global financial reality in which this happened, but it would have given the bank, its employees and its shareholders a much better chance of surviving reasonably intact. Many organisations either do not have a full-time BCM function in place or, if they do, it is hidden in some specialist area like IT or risk management. Surely no one would disagree that the decisions covered by these questions are the most critical, far-reaching and business threatening if they go wrong? In other words they put your business continuity at risk much more than loss of an office block, a data centre or even critical personnel. They can ruin your reputation, market share and credibility overnight. So the conclusion is that most companies use business continuity to protect against operational problems, but not to provide input to strategic decisions. Many board members might choose to ignore the views of the BCM professional, assuming they will be risk averse and non commercial in their thinking. It is easy to see why this might happen. BCM traditionally looks to eliminate single points of failure, to spread activities around so as to improve resilience and have adequate resources to deal with unexpected contingencies. This is not a message likely to be popular with many managers, increasingly eager to embrace business partnerships and single sourcing, larger and larger fully automated distribution centres and ‘just in time’ delivery. This perception only occurs because business continuity managers are generally not operating at the correct level. If they are part of the senior management team with clear strategic responsibilities for inputting to and ultimately implementing board policy then their vision has to be wider. Your current BCM manager might not be viewed as of the right calibre to make this step up, but that is only because you probably have not defined the job correctly and, therefore, not resourced it appropriately. Even at a more basic level there is much that BCM can do to help reduce the risk of failure when we make strategic changes. For example, the risks involved with ‘single points of failure’ are almost entirely preventable and only occur because of lack of a good business impact analysis. Knowing your critical products,

Should all types of risk be managed consistently in an enterprise wide framework? If BCM provides a solution for IT and many other operational risks, why can’t the same principles work for business, strategic or reputational risk? When something unexpected happens, do you not need to have anticipated something similar and planned for what you might do? Why do financial firms invest hugely in training staff and exercising procedures to deal with physical disasters but ignore other crisis situations?

3 VITAL QUESTIONS FOR TOP MANAGERS When you are considering a major strategic change to your business (e.g. outsourcing, off-shoring, rationalisation of locations) whom do you involve in the decision process? When you are considering a major strategic change to your products and services what is the basis for your decisions and how are the risks evaluated? If you have a business continuity manager, where does he or she fit in the organisational structure?

services and dependencies is vital. It is then often possible to design out the risk by changing the design or the specification. Don’t be surprised when things go wrong but make sure that your process can manage the unexpected. BCM is not really about clever technical solutions or documented procedures. It is about process reliability and continuous improvement – topics close to the heart of any serious manager. I am often asked about the role of BCM in managing the impact of climate change on business. BCM is traditionally about dealing with serious but unexpected incidents at very short notice with limited available resources and confused sources of information. Climate change is anything but unexpected or unpredictable, it will take many decades for its worst consequences to happen and it has potentially the entire resources of the world to solve it. Better still, if scientists are to be believed we could take actions now that would solve the problem, or at least mitigate the impact and prevent the worst consequences happening. However, if we accept the cliché that every problem is an opportunity, companies that provide imaginative solutions will become the successful companies of the future. Technology might have caused much of the problem, but it is only technology that can solve it. When you are talking business change on this massive scale you are also talking serious business continuity management.

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EXECUTIVE INTERVIEW

KEEPING GUARD Soloman Edun of Global InfoSwift Technologies delivers a stark warning to businesses on the perils of not having adequate business continuity solutions in place. CXO. What challenges are companies facing when it comes to managing data and other information, as well as preventing security breaches? Soloman Edun. Organisations are increasingly relying on information and how efficiently it is delivered within their business units and to their ultimate customers. As a result, information technology infrastructures are facing enormous challenges in deploying architectures that are scalable, while reliable and capable of supporting an everincreasing demand in data. For example, one of the biggest challenges our customers are presenting us with is how they can optimise their IT infrastructure to resource the demand of storage requirements, how this information can be provisioned efficiently within the IT infrastructure, and how IT resources can be managed and optimised in order not to be deployed and operated as independent silos within the data centres. When it comes to security, IT plays a fundamental role in making sure security and compliance policies are published and rolled out across the entire organisation. Having an IT security strategy which responds automatically to the enterprise risk frameworks identified by organisations is paramount in order to mitigate any security threats and vulnerabilities. CXO. What are the downsides of failing to adequately guard against a gap in security? SE. It is easy to speculate on the consequences organisations are facing as a result of a non-existing or poorly-implemented security strategy. We have experienced some crisis situations where organisations have suffered consistent financial losses, after becoming victims of cybercrime activities. In such circumstances, appropriate incidence response management procedures help to mitigate the risks of any security breach, while a pragmatic approach to forensic analysis can help organisations remediate these scenarios and avoid their recurrence in the future. Another differentiator in helping

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Solomon Edun manages Global InfoSwift Technologies. He has had a distinguished IT Management career, and is regarded as one of the most respected personalities in the Nigerian IT Industry. Edun has a degree in Computer Science from the University of Benin and has extensive international exposure to business management. He is currently a member of the Business Continuity Institute, UK.

mitigate security risks is to educate organisations and their customers on the risks they are facing when using information technology. Therefore, we often see that targeted security awareness programmes are crucial in raising the awareness of organisations and their customer base. These programmes, together with an appropriate strategy for online fraud protection, are real differentiators for organisations to adequately guard themselves against gaps in security. CXO. What has fuelled the need for organisations to ensure that they have adequate business continuity and disaster recovery plans in place? SE. Organisations are mature enough to appre-

ciate the exposure they may have, should they decide not to deploy a suitable business continuity programme across their business units. This awareness is widely accepted in the marketplace to a point where that regulators are dictating the criteria organisations should follow and comply with in order to establish adequate business continuity and, from and IT perspective, disaster recovery plans. In the context of business continuity, it is important for organisations to choose the most suitable options for a recovery planning process, by taking into consideration the already-identified threats and vulnerabilities but also by re-aligning the original business objectives with the identified and agreed service level agreements and the KPIs for operation efficiency. Any business-critical function and process should be mapped in order to provide a holistic view of the dependencies and correlations between the business and its underlying structure. CXO. How are your wide variety of products and services benefiting your clients’ operations? SE. Global InfoSwift Technologies offers services ranging from IT strategy consultancy to IT solution delivery and specialised solutions. We assist organisations in developing knowledge management strategies, data protection, service-oriented architecture, business continuity management, and business process re-engineering. We recently organised the first ever business continuity management workshop in Nigeria, in partnership with the Risk Management Association of Nigeria (RIMAN), and the Business Continuity Institute, UK, and also assisted a major financial institution in developing a business continuity strategy that saw the organisation operating full time during a demolition process next door. Our client base ranges from banks, telecoms companies, FMCGs and NGOs to government Institutions and para-statals.

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INFRASTRUCTURE

SMART THINKING

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Malta could be Europe’s next IT hotspot thanks to a high tech business park which is being built there by Dubai-based developers SmartCity. Diana Milne meets CEO Fareed Abdulrahman to find out more.

t’s not often that a European government calls on the expertise of a Dubai-based company to build a major infrastructure project. But as one of the pioneers behind the transformation of Dubai – SmartCity, a joint venture between TECOM and Sama Dubai, members of the government owned Dubai Holdings group – is now in a position where it can import knowledge from East to West. Having successfully set up the high tech free zones, Dubai Internet City, Dubai Media City and Dubai Knowledge Village, the company it is now working with the Maltese government to create the €235 million SmartCity Malta project. Described as a “knowledge based township”, SmartCity Malta will create 5600 jobs and once completed in 2021 will be the Mediterranean’s leading ICT and media cluster and the country’s largest foreign investment. As well as offering office space to ICT and media companies, it will include homes, hotels, conference facilities and retail units. But why Malta? SmartCity’s CEO Fareed Abdulrahman, explains that the country was chosen because of its location and its potential for growth. “We have two models that we look at when we choose any location. One is the Dubai model in terms of location. If you look at Dubai today we always say it’s the bridge between West and East. Malta is the bridge between South of Europe and North Africa. Location wise it’s perfect and it’s also very close to the Middle East. The second factor is the soft infrastructure and Malta has the soft infrastructure to attract people. It’s a very safe place. The lifestyle is great. It’s so peaceful, it’s very safe. It’s very similar to Dubai. And I like the system. Despite being a small Island it is ranked number three in terms of eGovernment in the EU. So this creates a good environment for the businessman, the investor and for companies.” Abdulrahman goes on to say that the jobs created by the project will create opportunities for Malta’s skilled IT professionals, who often move overseas for work because of a shortage of positions in their home country. The aim of the project is to boost the Maltese job market by 4 percent making it the biggest job creator in Malta’s history. Of the jobs that will be created 65 percent will be new jobs in knowledge-based industries. “Although Malta has qualified people they always go somewhere else. You find them in the UK and in Australia especially,” says Abdulrahman. “We will be looking to attract back some of the Maltese talent that has left the island to work in other markets. Many industry experts in Malta have expressed concerns over the flight of scientific and technological talent. This project will contribute towards reversing that trend.” However, in order to create job opportunities in Malta, Abdulrahman must succeed in attracting IT companies to set up headquarters within the SmartCity cluster. He says one way to do this will be to encourage these companies to use SmartCity Malta as the base for their North African operations given the country’s proximity to the continent. “We are aiming to attract IT companies that are looking for an office location in

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Fareed Abdulrahman is the CEO of SmartCity and a board member of SmartCity Malta and SmartCity Kochi. Fareed is also in charge of the expansion of TECOM's offices internationally. In this role, Fareed sets strategic objectives for the SmartCity brand and the execution of each project. He spearheads efforts to identify and develop opportunities for expanding the global SmartCity network along the lines of Dubai Internet City (DIC), Dubai Media City (DMC) and Dubai Knowledge Village (DKV). Abdulrahman started his career with DIC in 2000 as an Account Manager, rising quickly up the ranks to become Regional Sales Manager for DIC and later Director of Sales. He was also a member of the initial core team which implemented the concept of DIC as a cluster for the ICT industry. He also developed the concept of International Business Centres, a service which allows trade development agencies to set up facilities for their national companies to enter the Middle East market in collaboration with DIC. Abdulrahman holds a bachelor's degree in Geology from UAE University, where he was placed overall second. He has also undergone Cranfield University's Senior Management Development Programme and is a member of Dubai Holding's Future Leadership programme. He is married and has two children. His hobbies include horse riding, volleyball and squash.

Europe that is cost effective for them. But are also looking to tap into business in North Africa. SmartCity Malta will create the ideal infrastructure, support systems, environment and lifestyle for ICT and the people working in the industry. When it comes to the multinationals we want to be their first choice for this.” Abdulrahman says he also hopes to attract homegrown Middle Eastern ICT and media companies to set up operations in SmartCity Malta, as part of their international expansion strategies. “Today we have the advantage of being able to tap into almost 4300 companies in Dubai Internet City and see what their growth and expansion plans are – especially when it comes to small to medium sized companies. The larger anchor companies we have in Dubai, include IBM, Cisco and Microsoft and obviously their focus is on being in Europe rather than in the Middle East, so there is that advantage too.” While keen to emulate the success of its Middle East developments in the creation of SmartCity Malta, Abdulrahman acknowledges that his company will face different challenges when it comes to its first European project. One of these will be the fact that it will be required to form agreements with local telecoms and IT companies to built a communications infrastructure and provide services to residents of the cluster. “We are not looking at SmartCity in terms of providing the telecommunications services. Instead we will be talking to the operators at that location to get the best services for our clients.” SmartCity will also have to be responsible for providing housing and other facilities for residents within the Maltese development – whereas in Dubai this was provided by local developers all too keen to invest in Dubai's thriving real estate sector at a location that provided a ready supply of tenants. As well as ofﬁce buildings the Maltese project will also include shopping boulevards, res-

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idential units and landscaped recreational areas. “We never worried about who would come up with housing facilities, retail outlets and hotel facilities in Dubai Internet City,” says Abdulrahman. “We knew what developments were being built around the cluster and that they would provide all the necessary facilities to our business partners. In Malta we will take responsibility for that creating a city that people can both live and work in.” The company aims to make the city as energy efficient as possible and has carried out an extensive Environmental Impact Assessment (EIA) to ensure it meets European environmental regulations and is in accordance with LEED (Leadership in Energy Efficient Development) standards. This is due to conclude with the carrying out of a traffic impact study of the project in accordance with LEED standards. While in the Middle East, the concept of creating a self-contained ‘city’ from scratch in a relatively remote location is a familiar one, SmartCity Malta will be the first of its kind in the country, creating infrastructural challenges for the company. However, Abdulrahman says he believes Dubai and Malta share similar aspirations and that based on this he expects the European project to emulate the success of its Middle Eastern counterparts. “In terms of strategic location, size, connectivity, access to key markets, and high tourism orientation, Malta and Dubai share a natural affinity. They have similar knowledge-economy aspirations. Malta’s vision for knowledge-based development finds a parallel in Dubai’s strategic plans to develop itself into a knowledge based economy.” Abdulrahman believes that the aspirations of the Maltese government and its desire to establish a strong knowledge-based economy mean the financial pressures currently facing European companies will not affect the success of the SmartCity project. Moreover he believes that IT companies are relatively insulated from the pressures posed by the credit crunch “IT business will not

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stop. It might reduce but it will not stop. There are a lot of mergers happening in some other industries but I’ve not seen mergers in IT. “Instead these companies will move to other locations that are more cost effective.” SmartCity’s international expansion strategy certainly doesn’t stop at Malta. The company has ambitious plans to create a global network of SmartCities in different locations worldwide. With this in mind it is hoping to develop SmartCity Kochi in partnership with the government of Kerala on a 246-hecactre site outside the city. The project, for which the company is still seeking approval, will create 90,000 jobs and become the focus for knowledge-based industries in the country. Abdulrahman says that the company also sees high potential for SmartCity projects in the Asia Pacific as well as in North Africa. “Asia Pacific, we strongly believe, has huge potential. There is an availability of talent and a diversity of industries there. Gaming for instance is huge.” He adds that the company

ABOUT SMARTCITY

SmartCity is a joint venture company made up of Dubai Holding members, TECOM Investments and Sama Dubai, to develop and manage Knowledge Industry Townships worldwide. The vision of the company is to be a business park provider that develops a global network of self-sustained townships. It combines; TECOM’s specialised expertise in the creation and management of knowledge based industry clusters, with Sama Dubai’s strength in real estate development in the international market. SmartCity is based on the successful models of Dubai Internet City, Dubai Media City and Dubai Knowledge Village and provides state-of-the-art infrastructure, environment and support systems that promote the growth of knowledge-based companies. SmartCity Malta, and SmartCity Kochi are the first international projects the company has undertaken.

believes it is important to target French and Spanish speaking companies. “Business doesn’t just happen in one language. There are other languages which are very much used. I’m talking about French. How to tackle the French speaking companies. There is also the Spanish speaking business and we very much want to address those customers.” He is highly conﬁdent that SmartCity Malta will succeed, basing his assumption on the success of the original SmartCity – Dubai Internet City. The project has achieved success beyond his original expectations, he admits: “I didn’t expect it to be such a success, I’ll be honest. And especially because the time when it started was when the whole dot.com bust happened. There are two main reasons why I think it was so successful. The primary reason is because of Dubai – the location of Dubai and how the Dubai system has worked. The second reason is that Dubai Internet City, which was ready in 365 days, has created new standards that have made it the benchmark for all projects in Dubai since 2000. The team behind this project and the leadership of the country were the reasons behind this success.” And while there may be big differences between the UAE and Malta, for both countries the Smart City concept represents a new level of infrastructure and the opportunity to kickstart an IT industry with huge potential.

“In terms of strategic location, size, connectivity, access to key markets, and high tourism orientation, Malta and Dubai share a natural affinity”

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EXECUTIVE INTERVIEW

EMBRACING THE POWER OF BPM The BPM market offers tremendous potential if managed by just business people and not the IT department, suggests AuraPortal’s Pablo Trilles. CXO. How can BPM help executives quickly respond to increasing competitive pressures and changing customer demand? Pablo Trilles. All BPM software must carry out the four life-cycle-steps: Modeling, Executing, Monitoring and Optimisation. With the BPM, the company models its business processes in order to execute them. With the processes monitoring, business users are aware of all the results achieved, and depending on these data, business users are able to optimise the processes in order to improve the organisation performance. Complete BPMS tools with no-programming required provide fast execution-optimisation shifts of the business processes in order to quickly react to the feedback from the market, therefore reducing time-to-market with new business policies. So a good BPMS allows executives to continuously improve their business models to ensure quick responses to changing customer demands and increasing competitive pressures. CXO. BPM inevitably leads to significant changes in company culture. Why is change management important to help BPM implementations go smoothly? PT. All organisations work with processes, even though many of them are not aware of it. Change management is a key factor in the BPMS implementation so if this fails, the project fails. If the employees do not believe in the benefits and profits obtained, they will probably reject the software. In order to guarantee the change success, the first step is to align the staff and the board of directors in the aim of improving work quality, to get better results, to reduce costs, etc. The second step is to start the implementation of the BPMS with simple processes where it is possible to evaluate the ROI over a short period of time. When this has been achieved, the company can approach more complex processes. By monitoring the BPM performance, busi-

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Pablo Trilles As VP of Marketing and Sales for AuraPortal, Pablo Trilles is a specialist in sales and marketing management. He started in AuraPortal in 2002 and one year later he became responsible for direct and channel sales. In 2005 he was elevated to his current position. Prior to Auraportal, he was in charge of regional sales at Samadi Consulting for two years. He graduated from ESIC University in 1999.

ness people can measure and evaluate the results of the processes and check the goal of efficiency improvement. CXO. How can ﬁrms ensure that their business processes are compliant with regulations today? PT. Following international standards help organisations to strengthen their structure, expand their activities and increase their business. Standards make an enormous and positive contribution to most aspects of our lives. When products, systems, machinery and devices work well and safely, it is often because they meet standards.

BPM tools are fundamental for organisations that have decided to follow international standards, since the BPM software ensures that the process execution follows a pre-established pattern designed according to the organisation’s needs and based on the standards chosen by the company. CXO. What factors should companies take into consideration when choosing software and providers? What are the pitfalls that should be avoided? PT. The BPM market offers different types of BPM products and providers. The questions to ask are: Is proof-of-concept available? Is it really covering the need of the company? Is it business user oriented? Is it easy to use? Does it follow BPMN standard? Is it 100 percent web-based? Short-term implementation? SOA oriented? DAD technology in Forms Builder? Intelligent Documents? Does it contain its own Business Rules system? Does it contain seamless relation of processes with corporate elements such as Employees, Projects, Accounts, etc? Is On-premises and Saas licensing available? Provider of ﬁnancial strength? Does it offer pattern solutions for the customer’s sector? A company looking for a modern and powerful BPMS tool should avoid requiring code programming, the ones offering free licences which will unexpectedly force them to an expensive upgrade, the ones only able to perform simple processes such as travel or holiday approvals, the ones requiring long implementations or the ones with limited features. CXO. As IT and business practices evolve, how is BPM likely to develop over the next few years and what new technologies are in the pipeline to facilitate this? PT. We expect a tremendous growth as soon as the BPM is handled by just business people (not members of the IT department). The necessity for BPM is there. But the BPM market evolution will depend on vendors’ offerings. If the BPM conception is redirected towards BPM designed to be handled wholly and directly by business people without any IT people or programming requirements, we envisage a tremendous growth, and since it seems that this redirection is already taking place (AuraPortal BPMS is pioneering that trend), we estimate double digit percentage growth (say, about 20 percent) starting in 2010 and for at least ﬁve years ahead.

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EXPERT OPINION

CHANGING

MINDSETS Hard economic times mean companies are increasingly putting the squeeze on their IT budgets. Jonathan Evans of consultancy firm Kepner-Tregoe describes how one company cut its IT costs by changing its corporate culture.

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ince the beginning of time the human race has had to adapt to change. Change is constant. And yet, behavioural scientists have recognised for years that humans fundamentally dislike change. We are creatures of habit. Over the past 30 years or so, companies have become ever more reliant on complex IT systems to support their business. Indeed, for some organisations IT has become ‘the business’ as boards lose touch with their original strategic goals. All major companies now rely on excellent Incident Management Processes (IMP) to guarantee service availability of critical systems. However, as the pace of change accelerates, the ability to maintain organisation and service level agreements becomes increasingly difficult. Knowledge management systems become obsolete as support staff simply do not have the time to keep them up to date. The confluence of these events inevitably leads to an increase in the number of Incidents and with it an increase in the cost of service management. A colleague of mine recently wrote a paper on ‘Organisational DNA’. In it he explores the idea that “the essential shape, nature and capabilities of organisations are dictated by organisational DNA and as a consequence, there are implicit constraints on the competitive positions that can be taken and on the degree to which organisations can realistically change.” In other words, as much as the management board of an organisation may recognise the need to change an organisation’s culture in order to survive, altering the very essence of that organisation is a Herculean challenge. This challenge permeates throughout the business. Whilst the CIO may recognise the need to divert more resources to finding root cause in an attempt to stop problems at source, in practice, IT functions often find it difficult to change from an incident management culture to one of problem management. Usually it will take an extraordinary event to ‘shock’ the organisation into breaking this cycle – to change its approach from one of constant fire fighting to fire prevention, as the following case study illustrates. A major organisation operating in the finance sector had been the industry leader for years. The organisation had 10 people dedicated to incident management to protect systems’ availability. As its systems became increasingly complex, the number of Incidents began to accelerate to a point where there were on average 50 high severity incidents per year – each with a potential exposure of US$2 million! The business began to lose its market position – sliding from 1st to 9th – and with it revenues began to fall

– eventually to 88 percent of plan. The business began accusing IT of “corporate destruction”. The threat of largescale outsourcing of IT operations was imminent. Something had to change. A Pareto analysis of incidents confirmed what many already knew – a huge quantity of incident management resources were being consumed by a small number of major incidents, many of which were repeat problems. Further data analysis revealed that the total number of incidents every year was 2500. Of those 50 were major incidents with a potential impact of US$2 million worth of damage. The number of incident managers was 9.5 and the number of problem managers, 0.5. In all 2300 IT staff worked for the companies. The company’s IT budget was US$160 million.These high figures meant the CIO had some tough decisions to make. Dramatic changes were made and as a result the number of incidents dropped to just 1100 per year with just five major incidents. Just one incident manager was employed, nine problem managers and 1050 IT staff in total. The total cost of IT was reduced to US$750 million. As a result of these changes the company regained its number one position in the market. Moreover, instead of being regarded as a hindrance to success, the IT department was now being praised for assisting corporate growth and any thought of outsourcing had evaporated. How was this remarkable transformation achieved? One of the most significant changes was to implement formal and structured problem management processes and make senior management accountable for success. Resources were immediately diverted to preventing repeat problems. Customer support staff were trained in Kepner-Tregoe’s world-class problem solving skills and success criteria were aligned to business metrics to ensure recognition was given to engineers who demonstrated good root cause analysis. In short the organisation culture changed from being reactive to proactive. Following on from this success the management board’s next target for the company’s CIO was to reduce the number of major incidents to zero. This, of course is impossible – and incident management will always be necessary to handle life’s unforeseen problems. However the lesson to learn is that whilst IM might seem to be the best way to approach our ever changing environment, by getting ahead of the curve – preventing problems at source by implementing effective problem management – and hence freeing up significant resources, organisations can be confident in addressing and even embracing change to gain maximum competitive advantage. n

“As the pace of change accelerates, the ability to maintain organisation and service level agreements becomes increasingly difficult”

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ASK THE EXPERT

Taking data warehousing to the next level HP’s Geoff Burkholder explains how its next generation of data warehousing solutions are aiding the business today to work smarter and make better decisions.

rganisations deal with huge amounts of data everyday and this has intensified significantly in recent years. The volume of data has certainly expanded within HP, and with our anticipation of our ongoing growth, data warehousing has become an ever changing facet. One of the biggest issues our customers face in financial services is the capture and management of data across lines of business, geography, and function. As a result of identifying these challenges across many of HP’s customers, HP purchased Knightsbridge in late 2006, a specialty consultancy firm focused on bringing data discipline, organisation, and management to very large data environments. With the combined capabilities of HP and Knightsbridge, we've created a new enterprise data management organisation, Business Intelligence Solutions (BIS). BIS is a solutions oriented vehicle to help customers solve the next generation of enterprise scale business intelligence challenges. The acquisition of Knightsbridge has allowed us to produce unique data warehousing solutions. Using its expertise we are able to aid companies to manage and exploit data both from the IT and the business side. By combining this with the software and platforms that HP has developed over the years, such as the HP Neoview Data Warehousing platform, HP is now delivering ground breaking BI solutions for its customers.

Customer success Our partnership with Republic Bank Ltd displays the success of such an implementation. Based in the Caribbean; they are the largest indigenous bank in the English-speaking region with over 40 percent market share in Trinidad and Tobago, as well as many of the other Caribbean islands. We have deployed the HP Neoview Data Warehouse solution there over the last year to enable the bank to create a ‘single version of the truth’ and with that, a sustainable data environment that is well-governed and provides the business with the means to stay competitive and excel

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teams, as well as the data architects and business analysts developing business intelligence capability. This methodology has allowed us to improve transparency which is demanded in today’s strict regulatory environment.

Solving challenges

Geoff Burkholder is the Director of Business Intelligence Solutions, Financial Services Vertical, Hewlett Packard. He directs the efforts of the HP BIS unit in solution development for the financial services industry vertical.

in an increasingly competitive market space. Republic Bank’s ﬁrst success with the warehouse is imminent and will drive key business performance reporting to the board of directors and senior management team. This will be quickly followed by Central Bank and compliance reporting to be driven from the data warehouse as well as analysis of customer data to leverage CRM investments. HP has designed a core philosophy and methodology around our next generation data management capabilities so that when we effect implementations, we do so in a consistent, holistic manner, allowing us to gain access to data, leverage that data, and maintain audit, balance, and control in everything we do. Thanks to this methodology, we are able to gain a picture of data lineage for the data we manage and can trace data back through the analytics layer to see what algorithms and processes it went through. Through the data quality processes, through to the ETL layer, and back to the source system. This lineage capability is beneﬁcial for the regulators, the audit

Our solutions are tailored to help companies solve complex information challenges. We are working on several types of solution suites, one aimed at solving Enterprise Risk Management challenges and another targeting Customer Management and the specialised challenges faced in managing customers and their respective data across business lines. One of the challenges that companies face with large scale data warehousing is more cultural than technical. HP Neoview Data Warehouse solutions combined with HP world class Business Intelligence consulting services allow them to reengineer their entire business process that functions behind the scenes. That’s the key transition that we have started to incorporate into our practices. Shifting the focus to the cultural aspect of IT and helping companies bridge the gap between business and technology. HP Business Intelligence Solutions features and advantages include: • • • • •

Innovative technologies and solutions World Class BI consultancy services Strategic partnerships and alliances Next generation BI infrastructure Faster time to solution with HP Neoview, the next generation of Enterprise Data Warehouse. It is conﬁgured and tested before delivery, enabling fast integration into existing environments . • Unparalleled performance in handling complex queries, mixed workloads and high concurrency. • Scalability to hundreds of terabytes, making it an ideal platform for data mart consolidation.

For more information, please visit http://hp.com/go/neoview

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CONSTRUCTION

Bricks, mortar and motherboards Tasked with creating an IT strategy that will help the construction and maintenance giant Rok Group to double its profits over the next three years, CIO Claire Hamon has a tough job on her hands. But as the rugby-playing tech chief tells CXO Europe, she is more than up for the challenge.

CXO. How does your role allow you to align Rok Group’s IT strategy with its business objectives? CH. I sit on the Executive Committee and help to develop the organisation’s business strategy. That allows me to put in place an appropriate information systems strategy to support it. This is required to help us achieve our ambition of becoming the nation’s local builder as we need to be able to provide information, systems support and telephony on a day-to-day basis to help drive proﬁts. A big part of my

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role is ensuring that the leadership of my team is closely aligned with our corporate values and goals. CXO. How reliant would you say the construction industry is on its IT strategy, compared to for instance, the ﬁnancial services industry? CH. I would suggest that the construction industry is not known to be heavily reliant on technology. It tends to focus on tangible goods and on services rather than the ﬂow of information through the organisation.

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I find it very challenging to be working within an industry that does not, traditionally, have a strong awareness of the potential of information systems. In order to raise awareness of this potential the organisation’s IT strategy needs to be fully aligned with the business strategy. That way any investment in technology adds value by making a practical difference. CXO. How important is it that data about Rok Group’s various projects is securely stored, up to date and easy to access for the company’s employees? CH. It’s very important, particularly for employees who work on lots of different projects in various locations. A really vital part of what we do is making sure that our people are working within a safe environment. It’s as crucial that IT enables them to share critical information about health, safety and the environment, as it is to ensure that the leadership of the company can access up-to-date financial data. CXO. Rok has ambitious plans. What are the company’s main business objectives? CH. Rok’s vision is to become the nation’s local builder and that means delivering building refurbishment and maintenance services consistently to every major city across the UK. The unique thing about Rok is that we use directly employed people who live and work in their local communities. It’s a really important aspect of what we do. We operate from a network of local offices; we’ve got over 55 at the moment with over 5000 employees, and ultimately our plan is to have a branch in every major town or city, which would mean more or less doubling in size. In terms of the key drivers for us, we are going to focus on that growth and on growing the maintenance side of the business. We’re going to be doing more plumbing, heating and electrical work.

our customers. We’ve got a fantastic innovation called ROK Home of Choice, which is a really good example of this, where we partner with two organisations to deliver a suite of housing types. We’ll be using greener products within those housing types, and we’ll focus on ensuring better value for our customers. We’ve got a big ﬂeet of vans so we will be utilising our national strengths again to make sure that we’ve got the best transport solution. In IT terms we’ve just outsourced our data centre management and have just succesfully completed the migration of the data centre. I’m really optimistic that this move will give us the national scale that we want and the ﬂexibility that we need to be able to match the growth of the business rapidly. It will also allow me to get my team focusing on providing added value for the customer. CXO. How are you contributing to ensuring the Rok Group operates in a sustainable way? CH. Sustainability is something that is core to Rok Group’s business strategy. Providing a healthy and safe environment and ensuring the sustainability of our projects is as important as the appropriate use of tools or appropriate safety guidelines on-site. Traditionally this doesn’t sit within the IT agenda but there is a member of my team who is responsible for ensuring that we maintain focus on the sustainability agenda, and in

CXO. What do these expansion plans mean in terms of the company’s supply chain, procurement, IT and logistics? CH. In terms of supply chain and the logistics, because of those ambitious plans for future expansion we’ll be working directly with manufacturers for key products we use and making sure that we have the most appropriate and innovative solutions to give to

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fact, one of the key criteria for selecting our data partner was that sustainability is very high on their agenda, too. Each of us needs to champion sustainability within our own department. CXO. The management of some organisations dismisses technology and IT as an unnecessary expense, particularly in smaller to medium-size businesses; how important in your view is IT, as a means of improving business process and customer service? CH. The key to raising the profile of technology within the organisation is to think of each IT project as a business project. The focus of these projects must be to look at how we can engineer or reengineer business processes to bring in greater efficiency. IT teams must focus more on this than on the technology itself. Too often IT projects are seen to overrun or not deliver the benefits that they were conceived for in the first place. They can become all about training employees to use the products and less about the benefits this technology will bring IT can absolutely improve business process and customer service if it’s focused on as a business project from the outset, and I think in the same way, it needs to be deeply embedded into the core business process.

CXO. There is a shortage of female IT professionals in senior positions. Do you think this is because women are less likely to pursue this line of work, or because they are not as successful as their male counterparts in the profession? CH. This subject is of particular interest to me. I think firstly, the failure of women to reach senior positions isn’t unique in IT. I used to work on the board of e-skills UK that has done some great work educating young teenage girls and also enhancing post-graduate education to increase the potential of females. Their research suggested that the girls become disinterested in IT in their early teens. What it found was that girls typically lack confidence in doing something they didn’t know very much about. They didn’t know much about a career in IT other than what they had been taught in classes, such as how to use Excel and Word — which frankly doesn’t really stimulate their interest. Boys, however, have a little bit more awareness, but also statistically are likely to be more confi dent in their abilities in an area with which they’re unfamiliar, and therefore, they see greater potential for a career in IT. I think the other issue is that for most of us that choose to have children, and I have two of my own, there is going to be a point at which we have to tread water and re-earn our stripes, and I think we have to remind people why they held us in high esteem before we left. My experience is that it’s a case of out of sight, out of mind. You can’t beat nature so women are more likely than men to require a career break. I think that will necessarily close down the number of opportunities for them to be appointed to senior posts.

“The key to raising the profile of technology within the organisation is to think of each IT project as a business project”

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CXO. What do you and the Rok Group hope to achieve over the next three to ﬁ ve years? CH. We’ve exited recently from the development business; we’re now

reducing our focus on contracting and increasing our focus on the maintenance business. We feel this is a real growth area. For me and for my team there are some fantastic opportunities to use technology in a way that we have simply not done before to deliver the right information to people at the right time and in the right form to support that ambitious growth.

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CASE STUDY

Virtual reality Stefan Prestele explains how a pharma firm sees benefits of virtual desktop deployment with enhanced security, reliability and manageability. V Pharmaceutical is a specialty pharmaceutical company that competes in the branded, generic/nonbranded, and value-added, specialty ingredient market. The company was in a situation similar to most growing organisations; its desktop PCs had become a nightmare to manage, as Ben Foxx, the Systems Architect explains: “The day-to-day maintenance, imaging, upgrading and troubleshooting of desktops was overwhelming. On top of that, we’ve never been able to back-up user desktops.” Added to this, the company was also under pressure to adhere to the compliance and security regulations required of a pharmaceutical company by the Federal Government, which made Foxx even more determined to ﬁnd a better desktop infrastructure solution.

Evaluation After a series of company tests Foxx decided to create a virtual desktop infrastructure (VDI) using Parallels Virtuozzo Containers. In particular, this would be used for any high performance business-critical applications. Foxx created a simple architecture which provides

“The VDI project has been so successful that KV Pharmaceuticals plans to expand the deployment company-wide”

Stefan Prestele leads all marketing activities for Parallels in EMEA. His focus is on innovative solutions that impact the organisation’s worldwide product strategy and marketing. Prestele overlooks 13 years of experience in IT business. Before joining Parallels in 2007, he held marketing positions at leading software companies such as Adobe and Macromedia.

and components; such as Ofﬁce 2003, an IBM AS400 client, plug-ins like Flash and video viewers, and a Citrix agent. This approach has made server conﬁguration and resources easier to manage and they need little adjusting despite user peaks and troughs.

Results increased ﬂexibility, manageability, security, reliability and performance at unmatched value using Parallels Virtuozzo Containers. The deployment sees users connect to central servers using either existing PCs or Wyse thin client machines. The servers then provide each user with the appropriate ‘container’ or virtual desktop which houses the applications

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The VDI project has been so successful that KV Pharmaceuticals plans to expand the deployment company-wide. Previously, the business had frequently deployed costly cutting edge PC hardware. Now, with Foxx’s new architecture and access to high performance servers, end users beneﬁt from even better performance than they had with their own

PCs. “Our users boot their system in seven seconds. With the manageability and performance of this solution, there hasn’t been a downside. We plan to expand it as quickly as we can,” Fox reveals. As for quantitative results, the company has looked at the cost of the new infrastructure, isolating the Parallels Virtuozzo Containers component, and evaluated it against standard desktop deployments. Considering hardware and software alone, and not the even bigger but elusive administrative costs, Foxx says: “If we place nine desktops on a single server, we break even. Today we’re running 40 on a server and we’re not even close to using the full resources of the server.” In addition, the architecture is a patch management dream. Every single environment and application is easier to manage and maintain which allows administrators to work on more interesting tasks rather than day-to-day desktop issues.

Protection Security is also maximised as all private and sensitive data is held on central servers and not on individual PCs, data never leaves the premises and is backed-up regularly. This helps the company adhere to the strict compliance requirements imposed on pharmaceutical companies. While most organisations are experiencing an increase in administrative demands, KV Pharmaceuticals has become more administratively efﬁcient. The company plans to reduce its desktop administrative staff of 14 to a conservative four over time. Ten staff will then be retrained and redeployed in other IT support roles, while the four remaining roles will become much more automated and advanced. “We see this as an opportunity to really improve on the service we give to our employees. Support and IT improves and the entire company becomes more productive,” says Foxx. For more information go to www.parellels.com

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Dedicated To Finance

New York 8:50 a.m.

London 1:50 p.m.

Dubai 4:50 p.m.

Tokyo 9:50 p.m.

John is upgrading some core banking functions. He wants to know how to ensure a smooth transition, so he calls…

Paul, who has seen the benefits of an upgrade and is now sharing project management tips with…

Georgina, the turnaround expert who’s moving on to a new project in Japan, where…

Ringo has the local knowledge. But he’s also planning for tomorrow, and that’s all about core banking…

Customer satisfaction Bo Lykkegaard, Programme Manager for European Enterprise Applications at IDC, reveals his CRM predictions. he field of Customer Relationship Management (CRM) has had a turbulent life over the past 15 years, since Tom Siebel founded Siebel and began to elevate what used to be contact managers for sales people into broader enterprise solutions for customer management. After experiencing meteoric growth rates during the 1990s, the global CRM market declined significantly during the 2002 and 2003 period as a result of the dot.com collapse and highly publicised CRM failures. Today, CRM is on the rise again. Current customer adoption is mainly driven by three key factors. Firstly, new delivery and licensing models, known as ‘software as a service’ and pioneered by Salesforce.com, shorten global implementations from years to months, reduce upfront cost and risk due to monthly subscription model, and enable faster product development cycles because the developers control the deployment environment. A second driver is the improved user interface, emulating design principles of familiar user interfaces such as Microsoft Outlook and benefiting from dot.com innovations such as task-based and proceduredriven user interaction, similar to when making a book purchase at Amazon.com. A third driver is built-in integration between CRM and industry-specific applications, for example customer service, billing, and service provisioning for telecommunications companies or sales and marketing tied into trade promotions management for consumer packaged good vendors. Such integration supports extensive business process automation and improves decision-making capabilities.

Direction Where will CRM go from here? IDC certainly believes the three factors mentioned above will continue to drive CRM adoption. However, four additional factors will boost CRM demand further over the next three years: Social CRM. Social CRM is the expression of the Web 2.0 innovations such as blogs, wikis, and user ratings into an enterprise CRM context. Consider the sales representative querying his/her CRM application to scan social networking sites to assemble a personal proﬁle of a new, customer decision maker prior to a critical meeting.

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Or imagine a customer portal where customers can post new ideas or requests and promote/demote the ideas of other customers. Or a selforganising sales/marketing intranet where all collateral is displayed in order of usage, ratings, and age. At a time in which lack of end-user adoption remains the number one threat to CRM success, social CRM represents a very valuable way to increase employee productivity and CRM usage at the same time. Upgradeable customisation. Some say the days of custom-built CRM systems are over. IDC tends to agree with that when it comes to core components such as pipeline management, contact management, campaign management, and so on. However, a large proportion of companies have CRM needs that are unique and critical to their organisation. New CRM applications will offer customisation extensions, built-in development frameworks, and standardised web services interfaces that will greatly simplify the addition of industry-specific extensions to support the needs of, say, the subscriber management of a publishing house or an auto-service membership association. Since the customisation is carried out within the CRM application framework, the customisations are easily upgradeable. Mobile CRM. The idea of employees accessing their CRM application from a mobile device has been around for a while. However, recent innovations in mobile computing such Bo Lykkegaard as mobile broadband, RIM Blackberry, and the Apple iPhone, will turn the dormant vision of mobile CRM into reality. Service technicians, travelling sales representatives, and consumers are examples of key CRM users that are typically not carrying a laptop or PC. Virtual suites and ecosystems. Customers do not want to tie best-of-breed CRM applications together with back offi ce applications and industry-specific applications. This means that best-ofbreed CRM applications will increasingly be consumed as part of larger, pre-integrated offerings. The ‘virtual suite’ is one way to create such larger solutions, in which SOA technologies are used to integrate what used to be stand-alone CRM applications with other enterprise applications. Oracle, Infor, CDC, and Sage are following this approach. Other vendors are relying on ecosystems in which vendors pre-integrate complimentary solutions, such as Salesforce's AppExchange and SAP's Business Process Platform. Bo Lykkegaard is Programme Manager at IDC for the European Enterprise Applications research, market analysis, and related consulting. He focuses on the composition and developments of the Western European applications software market, in particular ERP, CRM, HR, and payroll applications.

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EXECUTIVE INTERVIEW

Mastering data management The business-critical information residing in an organisation’s IT system needs to handled, stored and utilised properly to achieve the best results. CXO speaks to HP’s Erik Moller to get the lowdown on dos and don’ts when managing data. CXO. Organisations have had to deal with an explosion of information in recent years. What difficulties and opportunities has this posed? Erik Moller. Information is the lifeblood of an organisation. Providing the right information at the right time is a critical success factor for compliance, risk management and competitive strength. Reliable information management maximises business insights for improved decision making, collaboration, productivity and customer service. But as the amount of structured and unstructured data grows, the problem of managing this information becomes more difficult. Data is often stored in lots of sources in many systems and organisational departments, both internal and external. Unlocking this information and ensuring that it is safe and secure is a huge challenge that needs to cross the boundaries of technology, people and processes. Without efficient information governance companies are exposed to high risks and financial loss. In order to turn information into a strategic asset, businesses need to manage data in an effective way with compliance and e-discovery solutions, paper-based process automation, business continuity and availability technology as well as business intelligence. CXO. What are the key drivers for introducing an information management solution? EM. Information needs resources around it to enable its protection and utilisation. So a key driver in implementing an effective information management solution is information governance. Information governance is a strategy to encompass legal standards and good practice so that organisations can respond more effectively to customer and industry requirements. It covers all electronic, paper or any other form

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Erik Moller is the Marketing Director in Europe, Middle East, and Africa (EMEA) for the HP Software Information Management (IM) Group. He is responsible for driving IM’s EMEA region marketing strategy and execution. This includes responsibility for marketing campaign planning and execution, sales support, regional product marketing and IM product evangelism. Moller has a Masters Degree in Electrical Engineering from The Royal Institute of Technology (Stockholm, Sweden).

of media relating to person identifiable and corporate information. Good information governance results in higher profits and faster time-to-market. Businesses can increase operational efficiencies, respond to customer requests more efficiently and lower the costs of meeting regulatory needs. Business continuity forms the foundation of an effective governance practice. But there is no one-size-fits-all approach to

information governance. Every company must conﬁgure their own governance programme based on their individual needs. CXO. What are some of the common mistakes that businesses make when dealing with the exponential growth of data? EM.The most common way to deal with the information explosion is to throw storage hardware at the problem. However, adding more capacity and not dealing with the core problem ultimately fails when the management tasks become gigantic or a company does not comply with industry regulations. This can result in enormous legal costs or even a court case. Increasing storage is not always the best solution. Through data de-duplication organisations can ease storage requirements, protect their data, recover lost ﬁles more quickly, and reduce storage capacity usage bills. The traditional approach is for companies to bury their heads in the sand and act as if nothing needs to be done about it. But in order to remain competitive, companies need to keep up with increased pressures to supply better information. With the right policies, processes and technology in place, the information explosion can be tamed and organisations can use their data to gain better business insights. CXO. What do companies need to be aware of when implementing an information management solution? EM. Best practices show that the return on investment of implementing an information management solution is substantial. It is crucial for companies to recognise that a failure to manage the information explosion strategically can be a costly mistake. In order to succesfully implement an information management solution organisations should: • Work in a cross functional way to set the right information management policies • Signal the importance of information management to all staff • Automate as many of the processes as possible • Implement a technology solution that scales with their business needs

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Guarding your assets The need for companies to deploy asset management technology is growing. Paul Gray CEO of NRX, explains how good asset information management practices can make businesses more efficient. CXO. Asset Information Management or ‘AIM’ is a business term we are hearing more frequently. Explain what it means. Paul Gray. Asset Information Management, is best described as a set of policies, procedures and tools for deﬁning, collecting, transforming, deploying and sustaining asset information across all stages of the asset lifecycle – from design and build, to the operations and maintenance of physical assets. In the oil and gas industry, for example, AIM enables an organisation to leverage its information asset and accumulated knowledge for improved asset management decision-making and competitive advantage. In the Master Data Management arena where customer (CDI) and product (PIM) master data domains have emerged, the proﬁle of AIM is gaining prominence. CXO. Which business issues does an AIM strategy address? PG. Thoughtful AIM strategies consistently tie back to an organisation’s business process improvement objectives. AIM is a foun-

dational enabler of operational readiness and operational excellence – principal business objectives of most organisations in the energy and manufacturing sectors. In capital projects, AIM enables operational readiness by helping to keep the project on schedule and budget. AIM underpins operational excellence by providing the information foundation that enables safety, reliability and efficiency initiatives. For organisations consolidating IT systems and migrating data, AIM enables the programmatic migration, validation and enrichment of massive amounts of technical data. CXO. What benefits can an organisation expect from deploying AIM? PG. A well-designed and implemented AIM strategy produces better, faster and more consistent decision-making leading to improved results in the management of assets across the entire asset lifecycle. More specifically, organisations deploying AIM can expect benefits such as reduced risks to project schedule and costs, improved

Since 1993, Paul Gray has been actively involved as an entrepreneur in the funding, strategic development and expansion plans of numerous companies which collectively raised in excess of US$400 million. At NRX, Gray guides the strategic vision and direction of the company, and the execution of its global go-to-market activities. He works actively with key customers to position the value of Asset Information Management (AIM) as a foundational enabler in their business process improvement initiatives.

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start-up results and accelerated time to revenue, improved labour efficiencies, reduced EH&S incidents, increased reliability, improved workforce knowledge retention, and improved MRO supply chain and MRO inventory practices. CXO. What organisations are currently deploying AIM? PG. In the energy sector, AIM is quickly becoming the solution of choice to gain control of, and efficiently manage, the large volumes of asset information required in new capital projects. Organisations are also deploying AIM as a core part of their IT system consolidation initiatives, for example, data migration projects where AIM solutions are used to ensure the integrity of technical data relating to physical assets. AIM is used extensively in business process improvement initiatives on brownfield sites, such as existing oil refineries and power plants, to assist with reliability, maintenance effectiveness and efficiency, and operational risk management initiatives. Organisations also deploy AIM to remediate their asset (master) data, and as a solution for management of change to ensure ongoing data integrity. CXO. How would you recommend an organisation to go about deploying AIM? PG. First, the organisation needs to have a well-defined AIM strategy, which it develops through prioritisation of key business objectives. The organisation should then organise a team representing capital projects/engineering, operations and maintenance, IT, and information management to meet and discuss their AIM challenges and requirements. Once the challenges and requirements have been identified and documented, the organisation should create a business case. The next step is the evaluation process for an appropriate AIM solution. If the organisation needs help, the major consulting companies can assist, as can NRX. Now, a company is ready to select a project to begin its AIM implementation. By beginning with an initial success, an organisation can build support for an enterprise rollout, so the business can realise the full benefits of AIM.

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ANALYST VIEWPOINT

Keeping your data ‘green’

are dynamically allocated storage capacity on the basis of need, is another way to increase capacity utilisation and infrastructure utilisation. Using storage tiers is another way to increase utilisation. In fact, one of the reasons IT organisations implement Information Lifecycle Management policies is to codify the movement from one storage tier to another. Once transactional data has lost its currency, the data needs to be moved to lower cost, lower-performance storage. In an ideal world, we would have a good understanding of what data needs to be retained, say for regulatory purposes, and for how long. Such knowledge would make buying storage more predictable, but the current ﬂood of information generated by knowledge workers in organisations of every size makes it unlikely that companies will stop or even slow adding capacity.

Monitoring

Even though the data centre is a conspicuous consumer of power and cooling, most IT departments don’t see the utility bill – often that bill goes to another part of the organisation. This practice is changing however, as inherently green thing to do because fewer better methods of monitoring consumption by servers means lower power consumption and servers and storage become available. It is eslower requirements for cooling, but it is also timated that only 40 percent of the power the right thing to do for cost and managecoming into the data center actually gets used ment reasons. Server virtualby servers, but rising energy isation is also about prices and the threat of global increasing overall infrastrucrecession is forcing compature efficiency, and perhaps nies to take another look at even more importantly, servconsumption throughout the er utilisation. Servers are freorganisation. Efficient use of quently over-provisioned to the infrastructure not only support applications (for exhelps control costs, but it also ample, database) that are increases manageability. the amount of data centre transactional in nature – lots Organisations don’t start power that actually gets used by servers of record writing and reading out being efficient; it takes a requires a robust server and commitment at all levels to fast storage to maintain acwork towards efficiency. As ceptable performance. As a result, storage with a green initiative, the company needs to capacity often becomes underutilised, the implement a purposeful strategy of increasing opposite of what we would wish for in an efutilisation of existing resources. IT organisaficient infrastructure model. tions need to incorporate the company’s So, consolidation of applications on virtual strategic initiatives and goals into their infraservers is a good way to break the IT practice of structure planning, acquisition and retirement ‘one application per server’ and thus increase activities. In this way, IT not only makes a suboverall utilisation. Thin provisioning of storage, stantial contribution to the company’s green in which allocation of storage is controlled by a initiatives, but it also enjoys the resulting efsoftware storage manager so that applications ficiency and cost savings.

By Jeffrey Hill, Senior Research Analyst for Data Management and Storage at Aberdeen Group.

ne of the most compelling aspects of ‘going green’ for many companies is that the kinds of activities that support sustainability also support increasing efficiency, using resources, and lowering overall infrastructure costs. This fortunate coincidence of objectives makes introducing greener concepts into an organisation much easier, even for people who are ‘doubtful’ about the substantive benefits. For example, recycling has tangible benefits beyond helping to decrease the amount of plastic and glass under landfills. I visited a foundry that machined brass and copper fittings in the early 1970s and was amazed how much usable material was reclaimed on the floor. Back then, the primary aim was to reuse costly materials in the manufacturing process; now the primary motive might be to reuse materials and meet corporate or stakeholder expectations for green. Both goals nicely coincide with saving money.

Virtualisation This fortunate coincidence of green goals is highly apparent in IT organisations and data centres around the world. Consolidation of applications and servers through virtualisation is an

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EXECUTIVE INTERVIEW

Getting a handle on your silos of information Bill Hewitt discusses the burning issues surrounding master data management (MDM). CXO. What are the main MDM challenges that companies are currently facing? Bill Hewitt. Simply put, it’s data, data everywhere. For many companies, the last decade has been about automating every process, from order management, to customer management to financial management. The result? A glut of data captured in different systems, at different times, in different formats. This inconsistency makes it nearly impossible to gain consolidated views of enterprise performance or compare results across the organisation. First and foremost, these companies need to define their ‘master data’; the definitions of customer, product, location, employee, and so on, which mean different things to each department and system. While most companies have recognised this problem, it can seem overwhelming to actually try to solve – particularly in the midst of keeping the lights on every day. CXO. What should they be doing to overcome these challenges? BH. It differs business by business. First, you have to determine what is most important to you. If you are a B2C company, customer data is paramount. If you are a construction company, asset and people data may top the list. Most companies need to stop worrying about implementing ‘master data management’. Take stock of your specific business needs; figure out what will make the biggest impact on your organisation and focus on addressing that problem. Regardless of where you start, you’ll need to address inherent data governance issues. Unlike automated data quality, MDM requires business involvement and human judgment (and therefore governance). A business can tackle a small piece of the data in their organisation – finance data perhaps – to learn how to develop data governance practices and use MDM tools to effectively manage the process in a way that works for them.

CXO. What return on investment can companies expect from deploying an MDM solution? BH. By focusing on the business, companies can identify the biggest area of potential return and target that area for the initial phase of the programme. For example, one Kalido customer has saved tens of millions of euros annually due to increased shipping efficiency/ accuracy and reduced transaction volume with high-risk customers. Another customer cleaned up the master data within the procurement department (overlaps were created due to a merger), and reduced procurement costs by millions of dollars in the first year. For other customers, the savings have been softer; increased efficiency in R&D, better inventory management, improved customer satisfaction or a reduced risk of misstated financials.

Bill Hewitt, President and CEO of Kalido, has more than 20 years of executive-level leadership experience in enterprise software, hardware and services markets. During his career, he has worked closely with senior executives from Global 2000 and midmarket companies to ensure that their projects deliver quantifiable business results.

CXO. What are the risks to companies of not efﬁciently managing their master data? BH. It’s very similar to what happened with KPI’s and scorecards. I talked to one CEO that told me he had over 300 KPI’s for running his business! The risk is you accommodate too many custom business practices and avoid the difﬁcult task of structuring your governance process. As a result,

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business intelligence tools may give managers different answers depending on which way they ask the question. That inconsistency can lead to hours spent massaging and reconciling data in spreadsheets to get numbers that are ‘close’ to the truth. In short, inaccurate master data can lead to bad reporting, bad decisions, bad customer service, and ultimately – a bad reputation and bad business.

stored. Ideally, master data so to new areas.

CXO. What new data storage technologies are being developed to help companies more effectively manage their master data? BH. A successful MDM solution is about the data governance processes required to improve master data, not the hardware. The time has come to apply business process to data management, and that is in effect what MDM is. The right technology will help you automate, guide and implement that data governance process, and ideally, provide you with the tools you need – a repository for the ‘approved’ master data, for example – that will help the programme succeed. Select a technology that is business user based; one that has extensive workﬂow capabilities to help guide the data governance process. Find one that enables the business to set the rules and models based on how the business is run, not how the data is look for a technology that can manage any kind of that you’ll be covered as your programme expands

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NEXT BIG THING

Giving forms the web 2.0 treatment How interactive forms are making tedious tasks a thing of the past. Prelini Chiechi, Head of Enterprise Marketing at Adobe Systems Europe, explains. eb 2.0 technologies, no better highlighted than by the iGoogle effect, are driving a complete overhaul of customer facing systems and interfaces. Customers are now being wowed by personalised online portals that include dashboards, calculators, customised offers, virtual assistants and 3D product configurators. So the venerable form might seem like an odd place to find this emerging technology making an impact. However, completing a form is highly likely to figure in a customers’ first experience of an organisation and by borrowing some of the technology and thinking that makes the latest generation of websites so engaging, forms have undergone something of a facelift over the last couple of years. Further, by combining engaging customer experience with process automation, this next generation interactive form perfectly fits the requirements of the current economic climate. Forms have been used to collect information since the earliest civilised societies and constitute the bedrock of many crucial processes within almost all the major industries, particularly the financial services industry. Account opening forms, payment request forms, standing order forms, product application forms, claim forms, the list is almost endless. Customers might have the occasional whinge about completing them – tax return forms spring to mind – but there’s no denying that a very high percentage of people are comfortable with them and understand how to use them. This is not something that could be said so confidently about the current generation of online banking services. In today’s world, the paper form is undoubtedly outdated. They’re inefficient because catering for a vast variety of people with differing circumstances means that very few people need to fill out every section. They’re

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“It’s easy to see forms as something more akin to the Industrial Revolution than the Digital Revolution” slow. Even when they can be completed electronically they often need to be printed and posted back to allow for wet signatures. Even with rapid development of scanners and optical character recognition (OCR) software, they place a huge manual processing burden on the back ofﬁce. They’re also a primarily paper-based process at a point in time when reducing paper usage is a key environmental priority – a damning charge sheet. Interactive forms, however, offer the best of both worlds: The engaging experience offered by web 2.0 technology with the instant familiarity of a form. Envisage being emailed an insurance claim form following a motoring accident that comes pre-populated with your name, address and

policy number. The form can not only be completed online but also offline and can be digitally signed and returned electronically without the need for printing. What if the form was generated on the fly, automatically adding the appropriate sections based on your answers so you no longer have to skip large sections that are not relevant? Further, when it comes to trying explain what part of the car has been damaged you’re offered an interactive 3D model of a car so you can click on the appropriate panels and are asked what happened to them as you do. Meanwhile the blank space where you usually attempt to draw how the accident happens becomes an interactive 2D space with cars, arrows and traffic features that can be moved around to show what happened. Perhaps more significantly, given the economic climate, once submitted to the originating organisation the interactive form can be validated and its information transferred into back-end IT systems without manual intervention or the need for scanners or OCR software. Any exceptions can be automatically flagged back with the customer for resolution. All without the need to alter existing back-end systems and workflows via a software layer that sits across and integrates with these systems. This insurance form exists today. In all the excitement generated by the web, it’s easy to see forms as something more akin to the Industrial Revolution than the Digital Revolution. Yet, with the current economic climate driving a desire to both increase efficiency and better service customers, interactive forms offer a technology that is very much in tune with the requirements of the modern world. Offering a combination of proven process and cutting-edge technology, they create more efficient processes and improved customer experiences, reduced operational costs and reduced carbon footprint.

Prelini Chiechi is responsible for overseeing Adobe’s enterprise strategy and positioning in the UK & Ireland. With over 14 years’ business marketing experience, Prelini has held senior global, EMEA and Asia Pacific marketing positions with leading, blue chip technology and financial services organisations.

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HEAD TO HEAD

Taking ALM to the next level Application lifecycle management (ALM) looks at the process of delivering software as a continuously repeating cycle of inter-related steps. Amongst its benefits, proponents claim, is increased productivity and quality, accelerated development and cuts in maintenance time. Are these the goals of a successful ALM producer? CXO asks Borland’s Andy Seager and IBM’s Syed Raza. CXO. How does ALM become a competitive differentiator among organisations? Andy Seager. Done properly, ALM allows organisations to realise the true beneﬁts of software within their business. ALM is about people and processes, underpinned by tooling that manages effective, on time delivery of software projects. This ultimately allows organisations to capitalise on market opportunity and drive customer loyalty – a competitive edge that most companies seek. Today, roughly 40 percent of software spend is consumed on re-work resulting from badly speciﬁed requirements and defects. Whether it’s your software quality process, traceability between ALM artefacts or a lack of visibility into your various process areas, combined together these contribute to the negative headlines that surround IT failure. ALM directly addresses these concerns and helps organisations to transform software delivery into a managed and predictable business process. By supporting ‘Open ALM’, Borland seeks to embrace a pragmatic approach to ALM where organisations have the choice in platform and processes they wish to improve.

– like re-work, poor requirements and an inability to cope with change – so it’s relatively easy to identify the ROI in doing these things better. Borland recently announced the release of Borland Management Solutions (BMS), a major focus of which is monitoring key ALM performance metrics and presenting information in a consumable, actionable format for all of the stakeholders in the process.

SR. The benefits from true ALM are both qualitative and quantitative. ALM aims to co-ordinate people, processes and tools in a continuously predictable cycle of interrelated activities: definition, design, development, testing, deployment and management. Automation and integration catch mistakes and inconsistencies before they become costly to correct, avoiding unexpected delays. Coherent metrics and real-time reports provide visibility to executive management, as well as a clear manSyed Raza. ALM lets you orchestrate your software developagement process, throughout the ment activities in tune with your overall business objectives application lifecycle. Aligning systems and and enables you to bring people together on a cohesive platsoftware development lifecycles with reAndy Seager is the Vice President of form for optimised productivity. It lets users communicate, coquirements improves traceability and unProduct Marketing at Borland. He is ordinate development efforts and avoid duplication through derstanding to dramatically improve the responsible for leading the product intelligent associations in their software development and decost of maintenance. A major maintestrategy for Borland’s Application livery environment. Connecting team members and stakeholdnance cost cause is change. By providing Lifecycle Management (ALM) solutions ers in an automated, integrated process to achieve traceability, a fully integrated, controlled change lifethat address the company’s vision for visibility and coordination, is integral to mature development cycle across all stakeholders and geograOpenALM. With over 10 years’ disciplines and in responding to ever-changing business stakephies, global ALM allows organisations to experience in product marketing for the holder needs. As organisations seek resources and markets embrace change and turn it into an optechnology sector, he has a proven track globally and the footprint and complexity of software increasportunity, instead of a cost. Today’s ALM record in execution and management. es, successful ALM strategies become a critical differentiator solutions provide real-time metrics and for organisations bracing to meet these challenges. views into a project’s health for optimal decision-making. There is support for CMMI level metrics, as well as statistiCXO. How can I quantify the benefits achieved by implementing ALM in cal reports and dashboards on portfolio progress. my development environment? AS. Your ALM vendor should be able to help you identify your current abilCXO. What are the flaws in today's ALM tools and approaches and what ity in the process domains of ALM; requirements definition and manageis your company doing to address them? ment, change management and quality management. Together, you should AS. There are a couple of key concerns with the current state of ALM, one be able to map a journey of improvement that will likely be a mix of process is the integration of the underlying ‘point’ tools for the various phases so transformation steps, and the supporting tools. The steps within your transthat they support the process and workflow across the software delivery formation can be mapped to real issues that impact your software projects life cycle (SDLC) – this directly impacts productivity. The other is an inabili-

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ty to effectively measure progress and surface meaningful metrics in a time frame that supports corrective action. Borland is committed to both these aspects of ALM improvement. We continue to build connectivity capability between the tools that exist today, plus we’re solving the workﬂow and measurement issue with Borland Management Solutions. Right now, we can help customers solve the silo issues from a process and tooling perspective and we can automate the collection of key metrics that support informed decision-making. Visibility is absolutely the key to improvement.

customers. To be successful, ALM adoption is a process of attaining escalating levels of process maturity as advanced development products are integrated and seamlessly deployed across global teams. This is an organisational learning process, and ALM serves as a catalyst in its achievement.

CXO. How does ALM help achieve collaboration among globally distributed teams? AS. One of the key advantages of ALM is the ability to support global teams; this is where tooling provides an essential advantage. ALM seeks to proSR. Today’s ALM environments have too many silos and manual points of vide information repositories that align teams and processes irrespective control between disciplines. Organisations tend to get locked into expenof location. One of the keys to successful distributed development is the sive technical architectures that are monolithic and slow to creation of a ‘single source of truth’ to evolve. Tools drive lifecycles and workflows of processes, and act as benchmark for all activity and integrations are poor and expensive to maintain. Meaningful asset changes. Implemented properly, reporting, visibility and metrics are hard to ascertain. Global such repositories allow distributed development especially is faced with communication and colteams to share and communicate with laboration bottlenecks. ease, which in turn drives true collaboIBM is focusing on providing solutions to help customers ration. ALM seeks to provide transachieve greater value and performance from their investments parency for teams by allowing them to in software by providing a transformational, integrated platform. work on common sets of assets, using We envision a framework for greater openness, collaboration, common processes, thus surfacing the right-size governance and day one productivity for customers’ impact of changes with minimal or no teams. Our vision is to provide an extensible process and a time delay to all stakeholders. repository-neutral, open standards-based collaborative platform Processes that are heavily dependent for software and systems delivery. on manual intervention or subject to delays in propagating changes are CXO. How does ALM help align technology decisions to busierror prone and add risk to project sucness needs? cess– automation really is the key to Syed Raza is currently developing AS. Historically, ALM has not delivered on this promise; not predictability and efficiency. Application Lifecycle Management (ALM) enough was being done to make effective investment decisolutions working closely with IBM sions on a multitude of requests from the business. Demand SR. Globally Distributed Development customers in defining the overall solution and portfolio management has typically been a rather discon(GDD) is real and transformational. offerings and go-to-market strategy. His nected process that was not sustained as the reference point Although the benefits of this practice background is in the systems and software for an active project portfolio. Consequently, the business are many—savings in money, time and engineering industry where he has worked found it difficult to evaluate the value of a portfolio against acskills arbitrage—organisations serving in various roles including product tual progress and outcomes of the projects within it. Borland global markets and utilising distributed management, software architecture and Management Solutions provide a vehicle to manage demand resources face increased pressures development and business consulting. and make decisions across portfolios because it links these acand challenges on the path to ALM tivities to every stage of the SDLC – so now the processes are adoption. ALM includes provisions for connected. Demand items can be linked to requirements and other ALM enhancing collaboration and communication between diverse, geographiassets. Project progress can be monitored against up-front assumptions cally separated development groups both inside and outside your organiso the business can now align priority with need and can continuously monsation. A global ALM solution provides web- and WAN-enabled capabilities itor the heath of a portfolio and assess its true value to the business. that control the meaningful flow of work assignments, changes, and other critical lifecycle information and attributes regarding project progress. SR. ALM is not a magic bullet. It is a disciplined, incremental, evolutionary A common repository for software assets that unifies team members approach to business agility. Aligning technology decisions ever closer to on a centralised, integrated SCM platform is a major advantage. This platbusiness needs is the critical frontier in ALM adoption. It helps achieve this form can be extended to incrementally integrate with lifecycle tools for the through a dynamic integration of people, processes and projects. ALM prorequirements of engineering, testing, deployment, business architecture, vides for a greater ease of consumption, extensibility and integration to portfolio management and integrated change management. The solution meet the unique usage needs of customers. enforces governance principles, validates compliance, provides real-time Improving quality of service and time-to-market to meet these devisibility, optimises workload balance, facilitates organisational learning mands requires ALM for seamless collaboration with partners, subconand reduces administration and logistical overheads, thereby leading to tractors, outsourcing organisations, global development teams and all-round agility. n

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IT has the potential to transform HR into a genuine strategic business partner. But only if those involved stand up and make their voices heard, says Jacqueline Kuhn of the International Association for Human Resource Information Management.

echnology is affecting every aspect of business and HR is no exception. Here the central role of technology is in helping HR understand what the workforce is, what they're doing, and being able to better leverage and manage that. We have gone beyond the basics of just tracking who the people are. Talent management is everywhere and applications are doing everything from screening people with assessments to tracking all their current and former job history. People are doing very thorough performance assessments and technology is allowing them to store the data from these processes all in one place and report on it and get a really good picture of talent. Probably the biggest change is just how technology is helping HR manage the people assets of a company, which are the most valuable assets it has. Recruitment, performance management and compensation management are the three key areas being reshaped by IT. Web-based, self-service manager/employee access analytics are really on the forefront in HR. Not just pulling out reports, but really giving HR the tools to be able to analyse and create the kinds of charts and graphs and information that senior man-

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agement is looking for. It's gone beyond just the report list of who you are and what job code you have. Technology aside, HR still has some way to go before it gets the kind of respect form management that other areas of the business command. It's getting better and the HR leaders that can talk business language are

“Too many HR people are doing things for HR’s sake, not for the business’ sake” definitely being seen as more bottom line. But unfortunately I don't think that HR overall really has a business mindset. Too many HR people are doing things for HR's sake, not for the business' sake. For example if you're looking at implementing a performance management technology, too many HR leaders are trying to justify implementing the technology because it will help them manage the performance process. It would be far better to ap-

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proach from the angle of helping business understand who their good performers are so it can make sure it’s leveraging the right assets. An area that is very much on the increase and one which holds great potential for HR is Web 2.0 and social networking technologies. These tools can be internal or external, but they give people unparalleled opportunities to connect with each other. People can find out what their contemporaries are doing and share tips that enable them to get a head start on projects they are planning. I hate to say it, being a consultant myself, but there's a lot of networking you can do with your peers that may help you reduce some of your consulting overhead. Internally too, this technology can really help the employees of a company. They can be much more efficient and effective and leverage some standards and best practices that much more quickly. I've seen a couple of companies doing this very effectively. Both IBM and OfficeMax are using these kind of technologies to create internal employee communities. Letting employees create their own social communities to feel connected has a big effect. Even if they are using company tools for things that are not necessarily ‘business related’, such as a company golf league, it gives them the opportunity to communicate with each other and really talk to each other and really feel connected. HR embracing those tools and embracing communities that way, will go a long way in employee retention and satisfaction, even helping diversity in some areas. It gives employee groups like LGBT communities a place where they can share experiences and advice. Those are the kinds of things that HR can do to help the employee have a better experience not just productivity-wise but personally as well. And of course that feeds back into the company itself: if you've got a happier workforce who are more engaged and connected with the workplace and their colleagues that has a positive impact on the company. That is really important to the younger generation of worker that is out there.

UNDERSTANDING THE HUMAN SUPPLY CHAIN he most important requirement is a good understanding of exactly what your people costs are. If you can get even a broad brush understanding of what your human supply chain is, then you can apply technology, that is going to help you manage the costs of that human supply chain. If you can improve that chain then you can definitely get real ROI. Let’s say you are a manufacturing company and you make a product. The human supply chain around making that product is the people who recruit the people to make the product, the people that market the product and the people who distribute and sell the product. You need to know what all the human costs of running the business are. Then you can identify what those costs are, and then show how technology will help you manage parts of that supply chain. If you are not able to reduce costs, maybe you can reduce time and time may reduce costs. Maybe it’s a matter of getting a better person in that can do the job better and – one percent instead of two. But what HR doesn't seem to take is a financial perspective on the human costs across the business, from an end-to-end cycle, and how much it really costs us to do what we do with the people that we have. And that is what's going to take HR to be able to get real ROI from technology.

They don't want to work somewhere where they aren’t connected. They're used to being connected at all times and they want to work at a company where they feel that they're being treated well and that they're enjoying their work. If they're not enjoying their work they're just not going to stay. The real downside is that HR is not always on the forefront of bringing in technology. Often the impetus is coming from operations and HR is almost just along for the ride. You can see this in the communication area, with Web 2.0 technologies and things such as Microsoft Sharepoint. I see a lot of corporate communications departments’ IT departments actually owning some of those projects where HR would really benefit from being in the driving seat. They allow you to reach out to your people and there are so many ways HR can leverage those kinds of tools for employee retention, education, training and communication. But I don't see the trend where HR is leading those charges. They may be a part of it but it often happens because IT wants to upgrade its overall portal for the company and then HR gets a piece of it.

Jacqueline Kuhn is Chair of the Board of the International Association for Human Resource Information Management (IHRIM). Kuhn has over 20 years in the Human Resources and IT professions with a focus on delivery of HR solutions through technology enablement. Her scope of expertise includes HR technology strategy, software selection, implementation, application management, sales and account management. Kuhn has worked in management positions in HR and Technology for RR Donnelley & Sons, Computer Science Corporation (CSC), Moore North America, Sears and OfficeMax and is currently President of Kuhn Consulting Group, LLC a firm specialising in consulting services for HR Technology.

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Trouble at the top Companies are now in greater need than ever before of management professionals to steer them through troubled times. But, as the latest report from the Association of Executive Search Consultants (AESC) shows, appointments of senior executives have slowed across the world. imes are tough and as companies look for ways to cut costs even senior appointments are affected, according to the latest report from the Association of Executive Search Consultants (AESC). It claims that in the third quarter of this year, net revenues from executive searches worldwide grew by 2.8 percent, the smallest annual growth recorded for over three years. There was a 6.3 percent fall compared with the second quarter of this year – the ﬁrst quarterly drop for almost two years following four years of exceptional growth. The report gives details of executive searches around the world, looking at average revenues per consultant. These were down by 5.1 percent since the previous year and by 8.5 percent since the second quarter of the year.

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Meanwhile, average fees per assignment rose by up to 7.8 percent on the year; and were down 2.2 percent on the quarter. An analysis by AESC of industry trends revealed that while industrial sector searches rose by 11 percent year-on-year there were decreases in searches within the professional, financial, consumer and non-profi t sectors. Despite these figures however, Peter Felix, President of the AESC, said he is optimistic about the long-term prospects for the industry, in light of the fact that the decline in senior appointments has been relatively small: “As might be expected during economic turmoil, executive search clients are being more cautious about initiating new senior hires than they were earlier this year. Nevertheless, the extent of the decline in worldwide revenues for the industry is still relatively minor and in many parts of the world many sectors are still showing strong demand. He goes on to say that he believes that as companies work on plans to survive the economic storm, the need to make senior executive appointments will increase. “I am confident that once the current uncertainty abates and organisations begin to plan their way out of recession, executive search consultants will see strong demand from clients who require help in finding and recruiting the best talent available to them, said Felix. Executive talent is still in very short supply around the world and only few organisations will ignore the necessity to invest in their leaders for the future,” he concluded. The worst yearly declines in executive appointments were experienced in Europe, where executive searches were down by 7.6 percent year on year and 10 percent over the quarter. The only region to see an increase over the year was Central/ South America (18 percent), which also saw the smallest drop over the quarter (two percent). Richard Boggis-Rolfe, CEO of the AESC UK steering committee and CEO of executive search specialists Odgers Ray & Berndtson, said that the current situation requires organisations to address the shortfall in their senior executive appointments in order to survive market conditions. “In a recession, businesses must be level-headed in their approach to making senior appointments. They should be prudent but should recognise that they have an excellent opportunity to bring in new talent,” said Boggis-Rolfe. “These market conditions call for leaders with experience, flair and the skills to transform organisations to ensure success. Nothing is more important than having the right people in the key roles. But those who perform well in one set of market conditions may not adapt when conditions change and boards have a duty to ensure that their key executives have the skills which new circumstances demand.”

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With more than 118,000 employees across 100 countries, Gary Steel, Executive Vice President and Head of HR at ABB Engineering, faces a mammoth task when it comes to people management. Here, he reveals to CXO his HR strategies and how he plans to win the talent war. CXO. what are your key business priorities? Gary Steel. Business excellence, talent management and rewards and recognition are ABB’s core business priorities. These form the focus areas of our ABB people strategy, the foundation of which is values, leadership and performance. The three interlinked focus areas are business excellence, career development, and reward and recognition. This drives the way we think globally and it inﬂuences the way we act locally. CXO. When did ABB decide that it needed a global HR strategy? GS. We determined that this was an important part of building a culture change in 2003. The company had been through a very difﬁcult time up to the end of 2002 where our very existence was at threat, and the fact of the matter was that the company was able to turn around based on the quality globally of its people. The people strategy was a cohesive framework within which to build a professional, modern HR management system tied to principles and philosophies which were deployed globally during the group. That’s in fact the framework we’ve been working to since 2003. CXO. How important is good talent management to the success of ABB – given how competitive the war for talent has become? GS. Talent management is truly the spine or the thread that determines everything we do. Our strategies are designed to benefit all 180,000 people who work in our company today, and talent management is not restricted to the high potentials or the top end of the organisation. We’re trying to drive talent management through the organisation at all levels. The reason for that is, like everyone else, we want the best people. What we’re trying to do to achieve that is to pay attention to the development needs of people at all levels in the organisation.

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CXO. What talent management initiatives have been deployed by ABB? GS. We’ve introduced a number of development programmes, some of which are exclusive for a certain group of people in the organisation, and some of which are inclusive for everyone in the organisation. All of them are building on the same concept of leadership, which is one of the foundational principles of our strategy. Talent management is deployed through training and development programmes and both performance assessment and behaviour assessment. Career development takes place through job moves, job rotations, international assignments, and assignments outside one’s normal business area. CXO. How quickly can good employees progress through the ranks at ABB? GS. Typically, people move upwards every ﬁve to seven years. That ensures that they spend enough time at the lower level getting experience ﬁrst to justify their movement to the next level up. We have about 1500 group key positions and today we have a coverage ratio for those group key positions of four people for each position. In 2003 that number was less than one. We’ve not gone out and hired 4500 people. What we have done though is plumbed the depths of our talent using the assessment tools and techniques that I mentioned earlier to a much greater effect and much deeper than was ever done before. The target here is to have 80 percent of our people appointed from inside to key group positions, and right now we’re running at about 68 percent.

ABB employees at work

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CXO. Is your role primarily to keep your employees happy? GS. The days when the HR department was just there to make people happy are long gone. I think it’s about building a culture in which people feel they can thrive, develop and expand, and if they can have some fun on the way that’s a bonus. The harsh reality is that many people are not ﬁt for the career they ﬁnd themselves in, and in conjunction with their line partners we have to have direct full and frank conversations with them about it. It’s not in anybody’s interest, not least ABB’s, to pretend that somebody has a career plan in line with their expectations if they’re clearly not suited. Now unfortunately that’s the opposite of making people happy. It makes them quite unhap-

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py, but in the end the outcome for them and the company is probably going to be better. CXO. How would you say you have succeeded in changing the HR function at ABB? GS. I think what I’ve tried to do is to ensure line managers are trained in good HR practice. Very often line managers make promises and when they make them they’re genuine enough, but if they’d actually stop to think for a few minutes, particularly around career and talent development, then they would know it wasn’t in their power to deliver what they were promising. I count on my HR people to ensure that line managers don’t fall into those traps. CXO. ABB has a workforce that expands over 100 countries. How do you go about getting your message out to such a geographically and culturally diverse audience? GS. We have a very good intranet site. It is, I have to say, one of the best. We’re very quick to carry the latest news developments on the site, particularly around business development. I think it’s important that we get those messages around the world quickly. We also use it in an HR sense for speciﬁc messages that we want to transmit. Secondly, the leadership team at ABB, the executive committee, are international people and we travel, and when we travel we engage. We engage with groups of people, we engage with individuals, and provided we’re consistent as a team in some of the messages we want to give, we do work hard at it. That’s a very important channel of communication. Another very, very powerful channel has been the ABB Leadership Challenge, which is a single three-day leadership programme, which covers all aspects of ABB leadership, and we’ve run it now for about 30,000 people worldwide. We’ve trained over 200 ABB people to deliver the programme, and that programme has carried a consistent set of messages, concepts, languages and words into all the parts of ABB that I’ve just mentioned. A lot of people say to me, ‘How do you cope with different cultures?’ I have to say after 32 years of working in international environments, the last 15 of which have been in truly international roles, that the idea of cultural difference is a myth put about by consultants who want to sell you a cultural change programme. In my experience, countries and people have many more things in common than they have that are different.

“The days when the HR department was just there to make people happy are long gone” CXO. One might expect an engineering company to be more focused on its technology but ABB seems to spend an enormous proportion of its time focusing on its people. What’s the business rationale behind this? GS. Well it’s people who develop technology. It’s people who spend money. It’s people who innovate. There’s nobody doing it for them. We haven’t got the machine yet that’s more intelligent than a human being, and I think there’s a very broad recognition that everything that gets done here gets done through people. I joke with our engineers that they were human beings before they were engineers, but if you think about it in those terms it helps you set the priorities. Good people who are oriented towards technology will produce better technology if they’re motivated and led in an appropriate manner. That’s the same with any other function, whether it be research and development, ﬁnance, HR, whatever. Good people want good

leaders and good people want to work in a successful environment. CXO. What is ABB’s current recruitment strategy given the difficult economic climate? GS. In September last year we had 109,000 people worldwide and we put a target for recruitment over the next five years of 45,000 people. That included 25,000 to meet our attrition rate, which is five percent per annum, and 20,000 completely new jobs. Now, notwithstanding the current economic climate, we have a total of 118,000 people. The downside is that that the real economy is bound to have some impact on what’s going on. I don’t know if ABB will definitely be affected, but I think it will be. How badly, I don’t know and nor does anyone else. On the other hand there’s the upside, which is that we have come through our own crisis. We have a very strong position both from a financial balance sheet point of view and in terms of our current performance. We have an exciting value proposition. We’re a very well recognised brand within the engineering world. Good people are attracted by success. We have that. Good engineers are attracted by leading edge technology. We have that. So without saying for a second that it’s easy, I think we have strengths that are exploitable.

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How to address and lead staff during an economic downturn By Stephen Archer, Director, Spring Partnerships

he global financial crisis seems to be deepening daily. Every day the media is full of stories about cut backs and redundancies across all different industry sectors. Those who aren’t cutting back seem to be in a state of panic and at the forefront of the minds of many CEOs is how to cut costs and streamline operations to get through the downturn. But rather than panic, this is the ideal time for CEOs to take stock and focus on how to address and lead staff to ensure they remain 100 percent focused on business goals and commercial success. Much of the advice being given by experts in the media has an operational emphasis, with less focus on the impact the crisis is having on employees that remain within troubled organisations, who are no doubt feeling pretty insecure about their future careers. Remember, your employees are in tune completely with the economic climate and the impact it is having on the company in which they work. In their daily lives they will be feeling the impact of rising fuel prices and increased household bills and they will be worried equally about their job security. Their morale may well be at a very low ebb. However, one thing is certain, the situation will be exacerbated if leadership has let morale slip and even more so, if it participates in the low morale. There is a clear link between employee motivation levels and business productivity. If employees are feeling confident and excited their roles and the business, your company will prosper. Remember too that the reverse is also true. Therefore it is not the time to put business plans on hold, nor to put your

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head in the sand and hope the situation will improve – that would be a sure fire way of ensuring your effectiveness will slip and a great opportunity for your competitors to steal your market share. Instead, it is time to take action and invest in your business plans more aggressively than ever before. You will need to ensure your teams are better motivated; correctly motivated and led with clearer direction by focused managers to ensure that your company stays afloat.

Investing in talent Whatever you do, do not stop investing in your staff – they are integral to your success. Do not cut back on the training and development of employees. Quite the opposite; business leaders should invest in

their people now and even up skill them through the introduction of new training courses. What’s more, if training and development plans are put on hold, then your staff will feel as though promises have been broken. They might also believe that their careers are floundering, which will impact their morale and eventually their productivity will suffer. But that is not to say that during these tough times you need to stick to formal development plans. Your employees could gain more experience ‘on the job’ at the moment particularly if you call upon them to use their skills to help you get through the downturn. They could be pushed out of their comfort zone and take on new projects that require them to learn new skills and develop a dif-

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ferent way of thinking. This type of ‘real’ business experience could develop them much further and faster than any formal training course and ensure that are adding real value to your business when you need it most. What better way of testing the metal of your employees?

Time for change Now would also be a sensible time to hone skills and develop people and company processes to ensure the company is fit for the future. Put in the new IT system that you meant to implement last year or introduce the new working practices you talked about in your management meetings. Again, it is all about making sure your company is ready and fit for the upturn. Everyone in your business will need to work in a smarter way and your managers should lead from the front with even greater conviction than ever before to ensure the team will follow. An organisation that behaves this way may not grow, but it will survive during an economic downturn. If costs do need to be cut then good leaders always involve staff in their decision making where they can, so their employees feel included and empowered. Also, they are more likely to empathise with your actions when the going gets tough if they have been party to your decision making processes. If redundancies have to be made then decisions should be made quickly and professionally. Managers should never over apologise for these decisions which is a common mistake. They also shouldn’t

Stephen Archer is a director of Spring Partnerships, a fast growing UK business and communications consultancy. Spring Partnerships works with major global brands, helping them to achieve business growth and success. It runs unique leadership training courses and strategic communication and change management programmes.

SIMPLE STEPS THAT BUSINESS LEADERS SHOULD ADDRESS DURING AN ECONOMIC DOWNTURN Front up to any issues very quickly; tell your staff that the economic conditions are working against the market – not just the business. Don’t leave employees in the dark on anything – remove all doubt and ambiguity. Stress that you have strengths that your competitors don’t and that you will focus on these during the downturn. Remember that nearly all people will want to follow your company’s leadership. They will be committed followers. Adopt the mindset that you will weather the storm, and then you will.

underestimate the huge sigh of relief felt by the majority of staff who remain in the organisation that it was not them that lost their jobs. While a short period of mourning is advised, don’t let your managers dwell on the decisions they have made. The best way they can honour their ex-colleagues is to make the company successful as quickly as possible.

“Ensure that everyone buys into the strategy and collectively wants to achieve the business goals laid out. Motivation is incredibly important” Standing around grieving does no one any good. Guilt on the part of the leaders serves no purpose whatsoever. Managers then need to look to the future and re-engage their staff and get them excited about future business plans. This is a time to revitalise remaining staff and remind them of the organisational values and beliefs.

Keep talking Communication is vital during these times – keep your managers and employees aware of how your business is faring during the downturn and show them your

passion and determination that the company will succeed; share your plans of how you will achieve this together. Ensure that everyone buys into the strategy and collectively wants to achieve the business goals laid out. Motivation is incredibly important. We only have to look back at the last recession to understand this – the companies that prospered were those that energised their teams, and they fought their way out of it. They certainly did not ‘batten down the hatches and pull up the drawbridge.’ Inevitably, in any recession, there will be companies that don’t survive – and it will be down to those that do to fill the market voids. This is the opportunity for successful companies to build market share and take the business from those who lost it. You will be one of those companies if you remain focused on your goals and your people, ensuring that your business is ready in every way possible for the upturn. This is the type of mindset needs to be entrenched into an organisation’s employees – they need to be looking for opportunities and get excited about being part of a company that is focused on growth. They should be energised and ready to outperform both commercially and psychologically against the competition and this mind set will follow from good leadership. n For more information visit springpartnerships.com

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BUSINESS DOCTOR

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A helping hand Executive coach Frances White answers your business dilemmas.

instead on criteria relevant to the success of the business not on minimising the loss Like so many CEOs in Europe I am faced with the difficult prospect of to any individual, however harsh that may feel. Your job as a business leader is first to making job cuts in order to achieve much needed cost savings. protect everyone’s jobs. The prospect fills me with dread as I run a close-knit company made Your role as a leader and human may include other things that may mitigate the up predominantly of long serving members of staff. Most are in their loss of the job to an individual – I would inmid to late 40s and will not find it easy to find new employment in clude offering really good coaching to help the individual to think through what he/she our specialised field of expertise. My question to you is how do I go wants to do next and how to deal with the about making the choice of who to keep on and who to let go? What rejection. I would also make sure you do everything you can to help that person to factors should I take into consideration and how can I soften the find their next role, including writing a very blow for those unlucky enough to be made redundant? detailed, specific and helpful job reference. Talk through with each of them what you Regards, have really valued and appreciated about Kaatje Hoffman. their contribution. Encourage them to talk about what they fear most for the future and Amsterdam, Netherlands. then offer them advice or support, where you can. Dear Kaatje, Redundancy can be a fabulous opportunity for people, giving Making job cuts is never enjoyable or easy, especially when the them the chance to reflect on what their next steps might be, organisation is small and you know your staff personally. However, giving them a financial cushion which can aid the process and in order to enable the company to survive and therefore protect providing a rare chance to get off the ‘merry-go-round’ of work jobs for all of you, this is sometimes essential. For the good of the and consider creating a different balance in life. organisation, leaders must often make tough choices for the benefit of the majority. How to choose? There are many different ways to make the choice. For the business leader, the success of the business must be paramount. So criteria should include the following:

Dear Business Doctor,

• Who adds the most value to your customers? • Who adds most value to the integrity of the business itself? • Whose role would be most difﬁcult/expensive to replace when your fortunes and the markets change again? • Who will be best able and willing to adapt and innovate in order to generate new business for you to recover quickly? • What is the cost of losing this person? • What is the saving to the company? What should not be considered is how much impact losing their jobs would have on individuals. The decision should be focused

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Dear Business Doctor, I was wondering if you could give me some advice about staff incentives. My hard working team have produced superb results for the company this year – despite the difficult economic conditions – and I want to reward them with a staff day out. The problem is they range in age from their early 20s to late 50s and it is difficult to come up with an activity that will please them all. A colleague suggested we offer the choice of various activities in different venues. But I feel this would defeat the point of this being a team day out. Please can you advise on what you think would be a suitable day out for a mixed age group and whether you agree with the concept of offering different activity options for the staff to pick on an individual basis. Regards, Per Branden,

Stockholm

Dear Per, The concept of a reward is interesting, since a reward for some could feel like a punishment for someone else! You mention later that you want it to be a ‘team day out’, which may or may not feel like a reward for some in the team. It would be helpful ﬁrst, if you decide – do you want to provide a team building activity which you want the team to experience together, or is it a true reward, in which case it may not be rewarding to go on a day out as a team. If you decide that you want to get the team together to experience something, then you have many options as to what you do. If you decide that you really want to provide a reward, then a more rewarding approach would be to give the team a budget and say that they may decide how to spend it together. They may, for example, decide to spend it on something rewarding that is not a day out – something entertaining for the ofﬁce, something everyone can share. If your outcome is that they go out together and you also wish this to feel rewarding for them, then it is important that you give them a choice about where they go and what they do. Make suggestions, by all means. If you can create a ‘package’ that should meet the most obvious requirements of most age groups, then even if some element doesn’t appeal to an individual so much, then other elements may be more suitable.

I would include something competitive and energetic, such as ten pin bowling. This usually gets everyone included, although some will clearly be better than others, so you may need to balance this with something else at which different people can be successful. I would also include something creative and have had enormous success with people doing treasure hunts or scavenger hunts in small teams, so no one feels excluded. Sometimes these can involve cars and solving clues or puzzles to get from point to point on a pre-assigned route which teams need to discover. I would also include eating together in an environment where there can be mixing, so not in a restaurant with long tables but something more informal or where seating can be ﬂexible through the meal. Think picnic style, whatever the actual location. For best results, offer a prize for the person in the team who comes up with the best (i.e. most acceptable to all) itinerary within a given budget. Have the team members all vote. The winner gets their itinerary. Everyone wins! Have fun!

“The concept of a reward is interesting, since a reward for some could feel like a punishment for someone else!”

Frances White works for NG Coaching- a London based executive coaching company which provides training for all aspects of leadership. For more information email: frances@dreamset.eclipse.co.uk

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BOOK REVIEW ON THE SHELF

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CXO takes a look at what the latest business book releases have to offer.

Your Problem, Our Story A management guide to handling emergencies and the media by Philip Algar Experienced journalist and crisis management expert, Philip Algar guides you through dealing with corporate crises and the ensuing media frenzy. As well as deﬁning what constitutes an emergency he provides plenty of information on dealing with journalists and techniques for press releases, broadcasts, conferences and interviews. Given the current economic climate, it is particuarly important for companies to ensure they are media savvy CXO says: A well compiled guide packed with practical advice. Expertly laid out with multiple bullet points and subheadings, Algar makes understanding the media easy.

The Secrets of CEOs 150 global chief executives lift the lid on business, life and leadership by Steve Tappin and Andrew Cave In this fascinating, authoritative book, 150 of the world’s top chief executives share their advice for getting to the top, and, once there, how to be successful leaders and still have a happy life. The book reveals frank discussions with some of the West’s most inﬂuential CEOs and incorporates radical and thought-provoking comments from the heads of the new corporate champions of India, leading companies in China and Russia and US corporate giants. CXO says: The Secrets of CEOs contains a wealth of strategies that individuals and organisations alike can use to encourage a new standard of leadership. It could well be an essential guidebook for those wanting to know what it’s really like to be a CEO – and the health warnings that should come with the job.

Total Leadership Be a better leader, have a richer life by Stewart Friedman The more you strive to win at work, the more you have to sacrifice performance and satisfaction in the other dimensions of your life. Not according to Wharton professor Stewart Friedman. His Total Leadership programme has shown that success at work is actually enhanced if you embrace a fulfilling personal life too. Friedman explains that leadership can – and must – be learned. CXO says: Applying a new method of thinking, Friedman offers a completely different guidebook to becoming a better leader. Total Leadership suggests both an innovative and sustainable model for leadership that can benefit every facet of life.

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CITY GUIDE Copenhagen

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Your essential guide to Denmark’s capital – from shopping to sightseeing

openhagen is the largest city in Scandinavia. With a population of around 5.3million, the city is linked to Sweden via the Oresund Bridge making it ideal for business commuters. Its rich history provides plenty of sightseeing opportunities and its waterside location and cutting edge architecture mean it is the perfect place to explore on foot.

Check in: Immerse yourself in Copenhagen culture during your stay at the city’s oldest hotel, Hotel D’angleterre. Situated in the centre of the city, and with a 250-year history, it offers bedrooms and suites all individually decorated and with original ﬁttings. Head to the hotel’s Arndal Spa & Fitness for an invigorating exercise session or a personalised, holistic spa treatment. Shop: Peruse the boutique shops at Bredgade, one of the city’s most beautiful streets which is located near to the palace of Amalienborg. As well as

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playing host to the high-end auction houses, Sotheby’s and Christies there are plenty of fashion and gift shops. If you want to bring a piece of Copenhagen back to your home visit Danish Classics where you’ll ﬁnd beautiful furniture from Danish designers Arne Jacobsen and Poul Henninsen. Nearby also are several monumental sights, including the Marble Arch and Amalienborg Palace.

Visit: The Danish Museum of Decorative Arts, Kunstindustrimuseet is reputed to be the ﬁnest in Scandinavia. Situated in Bredgade, it houses more than 300,000 decorative objects, both modern and historical. Walk: The main attraction to be found in Copenhagen is the Little Mermaid at Langelinie Quay, located by Copenhagen Harbour. Adapted from the magical fairytale by famous Danish author Hans Christian Anderson, she is a small and beautiful bronzed statue and pays tribute to Scandinavian tradition. The surroundings of the harbour also play host to historic treasures, such as the beautifully restored fortress, Kastallet.

Dine: Indulge in Copenhagen’s most delectable menu at Noma restaurant. In its third year of cuisine, it has already been awarded a Michelin star and is set to receive another. Located in Christianhavn, a man-made island, it is surrounded bycolourful old houses and canals. Inside is no less beautiful: the interior design is spacious but with the homliness and warmth of woodern ﬂoorboards and soft candlelight. The menu comes highly acclaimed, most notably for its delectable wines.

Party:

Finish your evening at Bar Rouge, a jazz lounge in the Københaun area incorporating a sophisticated ambience. Copenhagen is well known for its jazz sound and evening activity, and it is here you can enjoy delicious cocktails while live music plays. If ﬂ amboyant cocktails and enthusiastic bartenders are a little too overwhelming, then head to the Copenhagen Opera House, across the harbor from Nyhavn, and enjoy a more relaxing experience at the bar.

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CATALOGUE PAGE CXO:nov08 04/12/2008 10:23 Page 155

Your World. Covered From the people you hire to the products you sell, if you’re in business, we’ve got it covered...

CXO Technology leadership is merging with strategic and financial leadership, and senior management is being called into a partnership for the future. CXO brings together a range of voices with one shared vision: to develop a strategy that considers business needs and technology’s role in moving your company forward.

Available for: EUROPE

Find out more: www.cxo.eu.com

Next Generation Pharmaceutical Approximately 50% of new drug development fails in the late stages of phase 3 – while the cost of getting a drug to market continues to rise.

Business Management What business processes work? What are the proven, successful strategies for taking advantage of domestic and international markets?

NGP is written by pharmaceutical experts from the discovery, technology, business, outsourcing, and manufacturing sectors. It is committed to providing information for every step of the pharmaceutical development path.

Business Management is about real, daily management challenges. It is a targeted blend of leadership and learning for key decision makers in government and private enterprise.

Available for: Europe, US, Asia-Pacific

Available for: US, Middle East, Russia

Find out more: www.ngpharma.com

Find out more: www.busmanagement.com

NextGen Power & Energy

Executive Healthcare Management

A poll of 4000 utility executives posed the simple question: what keeps you up at night? The answers were costs, new technologies, ageing infrastructure, congested transmission and distribution, viable renewables and inadequate generation capacity.

The healthcare industry is changing. Understanding how to improve clinical processes, meet industry standards and merge the maze of disparate systems is vital.

NextGen P&E covers them all.

EHM combines unbiased industry news with thought leadership from the most respected executives in healthcare, providing a platform for strategy and learning.

Available for: US

Find out more: www.nextgenpe.com

Find out more: www.executivehm.com

HRManagement

Financial Services Technology

HR needs three eyes: one on the past – don’t lose sight of the systems that generate value; one on the present – determine if current processes are efficient; and one on the future – be proactive in meeting new challenges.

Providing for its customer’s needs and demands is the goal of financial institutions now more than ever. But it is a tricky remit to fulfill. Your customers want it all – security, cost-efficiency, speed, added functionality and, most of all, convenience.

HRManagement concentrates on the development of HR strategies, directions and architectures.

Can it be done? Read FST to find out…

Available for: Europe, US

Available for: US, Europe

Find out more: www.hrmreport.com

Find out more: www.usfst.com

gdsinternational

www.gdsinternational.com

THE KNOWLEDGE First Class Airport Lounges

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Travel in style by stopping off at some of the world’s most luxurious airport lounges during your next business trip.

Lufthansa First Class Terminal, Frankfurt

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Virgin Clubhouse, Virgin Atlantic, San Francisco

Lufthansa First Class Terminal, Frankfurt

The Wing and The Pier Cathay Pacific, Hong Kong

Virgin’s Clubhouse lounge at San Francisco Airport boasts spectacular views of the city’s iconic landmarks. To best reﬂect the bright harbour lights and distinctive buildings of the city, it features moving glass panels which are coloured to create different atmospheres within the same space. Five monitors displaying digital art and a magniﬁcent view across the Bay further embellish the setting. For the busy executive, there are laptop points throughout and 24-hour business facilities. The centrepiece of the Clubhouse, the bar made of glass, has won a string of prestigious design awards.

Lufthansa has taken the lounge concept one stop further at Frankfurt International Airport by creating an entire all First Class Terminal. Features include private spaces with daybeds and luxurious bathrooms. Private ofﬁce units with a telephone and laptop are also provided for those who are unable to clock off. The restaurant hosts a seasonal menu and ﬁrst class wines, and an extensive buffet is also available.

Located within Hong Kong International Airport, The Wing and The Pier premier lounges both offer exceptional ﬁrst class facilities. The lounges pay attention to individual details, and feature six DayBreak rooms and Personal Living Spaces. Relax in an armchair with a private television, or take full advantage of the top of the range broadband-connected personal computers. There are multiple places to dine within the Lounge; The Haven offers a stylish menu and interior or choose a meal at the Noodle Bar. For a concierge service, the Marco Polo Club is available.

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Premium Lounge, Abu Dhabi

The Wing and the Pier, Hong Kong

Club Lounge, Heathrow

Golden Lounge, Kuala Lumpur

Golden Lounge, Malaysia Airlines, Kuala Lumpur

Club Lounge, British Airways, Heathrow

Premium Lounge, Etihad Airways, Abu Dhabi

Designed with families in mind, the Golden Lounge at Kuala Lumpur International Airport features a manmade rainforest, a river and a Creative Kids’ Corner. There is even a slumber room for tired children. For adults, there are also plenty of opportunities to unwind, including massage chairs and an extensive drinks and food menu. Busy executives, can take advantage of wireless LAN, meeting rooms and Malaysian stock market update displays on screens around the lounge.

BA’s newly opened Terminal 5 hosts six lounges within its New Galleries Arrivals area. The BA Club Lounge, which opened in September 2008, features luxurious furniture classically tailored in rich velvets and herringbone fabrics. A restaurant menu is provided, with waiter service allowing passengers to dine before boarding their ﬁghts. Also located within Terminal 5 is the Elemis Travel Spa, which provides spa therapies for both men and women to refresh and relax passengers.

Elegant, warm and welcoming, Etihad’s lounge offers the comfort, space and facilities to make your journey through the airport a pleasant experience. The lounge is well equipped with laptop connections, high-speed internet access and fax and telephone facilities. There’s also an excellent range of audio and video programmes to keep you entertained, as well as a fine selection of refreshments and hot and cold buffet dishes to choose from. Situated on the first floor of the airport, it offers a stunning view of the runway.

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THE KNOWLEDGE First Class Airport Lounges

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Travel in style by stopping off at some of the world’s most luxurious airport lounges during your next business trip.

Lufthansa First Class Terminal, Frankfurt

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Virgin Clubhouse, Virgin Atlantic, San Francisco

Lufthansa First Class Terminal, Frankfurt

The Wing and The Pier Cathay Pacific, Hong Kong

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Premium Lounge, Abu Dhabi

The Wing and the Pier, Hong Kong

Club Lounge, Heathrow

Golden Lounge, Kuala Lumpur

Golden Lounge, Malaysia Airlines, Kuala Lumpur

Club Lounge, British Airways, Heathrow

Premium Lounge, Etihad Airways, Abu Dhabi

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GADGETS Smarten yourself up

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Smartphones these days are slimmer, and packed with more features and applications than ever before. Here are a handful of our favourites.

BlackBerry Storm

Palm Treo Pro

Research In Motion’s ﬁrst clickable touchscreen phone could just dominate the corporate and consumer market, as well as topple iPhone’s crown in the process. It comes packed with the usual BlackBerry features as well as GPS, a 3.2 MP camera and 1GB of onboard memory.

This latest offering from Palm is arguably their best looking phone to date. It features Windows Mobile 6.1 running on its 320x320 resolution touchscreen display while GPS and one-button Wi-Fi is also provided, along with a full QWERTY keyboard.

Sony Ericsson Xperia X1 The hottest phone of the year from Sony Ericsson has a huge touchscreen WVGA display and a nifty keyboard that slides out from underneath. This Windows Mobile device comes with a 3.2 MP camera, GPS and a 3.5mm audio jack.

Nokia E71 The E71 from Nokia boasts a full QWERTY keyboard, albeit with rather tiny buttons. It’s slim too at 10mm thick, while the chrome shell gives it a quality feel. It features Wi-Fi, GPS and comes with full ofﬁce and email features.

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LAST WORD

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Sound and fury Europe’s business leaders give their verdicts on the global economic downturn.

“I think 2009 will be worse than 2008 in terms of the global financial situation. I’m preparing for the worst and hoping for the best” EasyJet founder, Sir Stelios Haji-Ioannou, reveals his opinion on the economic outlook for 2009.

“It’s going to be tough. The likelihood of some companies going bankrupt is going to be very high. It may create turbulent conditions’’ Renault – Nissan CEO Carlos Ghosn on the future of the global car market.

“Good assets, which are not related at all to toxic assets, have also been infected by the crisis. I think that will continue for a while. Probably we are not at the end of deleveraging yet but we are seeing a floor” ING’s CEO, Michel Tilmant, addressing lawmakers in the Dutch parliament on the state of the equity markets.

“We are well-placed to weather the prevailing financial storm and to benefit from the business opportunities that may well arise from a downturn. Our balance sheet is strong and we have committed less of our portfolio to high-cost options like tar sands and gas conversion than some of our peers” The outlook for oil giant BP, according to bullish CEO Tony Hayward.

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