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JUNE 2018 | Vol. 23 No. 4
IN THIS ISSUE ALEX COLVIN ANASTASIA VOLKOVA BILL LE BLANC BRYAN LEE CHRIS CARTER-JONES CHRISSY HEALEY DAVE CURRAN
DIGITAL DISORDER DiUS: Cutting through the chaos
ELLIOTT MURRAY IAN RICHARDS JAIDEEP THYAGARAJAN JAMES MERCER JENS BUTLER JESSE CARDY KATHERINE BINKS KATRINA YON KEE ONG KENT FORSTER KIMBERLEY HALL MARINA FRONEK MATTHEW GORDON NICK VERYKIOS PAUL BIRD PAUL SHETLER PETER STEIN PETER WRIGHT STEVEN MILLER SUAN YEO THOR ESSMAN
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*Terms and conditions apply. Prices shown in AU dollars including GST. For eligible models and more information visit https://www.lenovopartneradvantage.com/jobs/0295-q119-promos/PCG-Q119-Bundles-FlyerAU.pdf. Lenovo (Australia & New Zealand) Pty Limited ABN 70 112 394 411 (‘Lenovo’) reserves the right to alter product offerings and specifications at any time without notice. RRP Pricing and product information is correct at time of publication and is subject to change without notice. All images are for illustration purposes only. Lenovo makes every effort to ensure the accuracy of all information but takes no responsibility for any editorial, photographic or typographic errors. Lenovo reserves the right to correct any errors, inaccuracies or omissions and to change or update information at any time, without prior notice. Trademarks: Lenovo, the Lenovo logo and ThinkPad are trademarks or registered trademarks of Lenovo. Intel, the Intel logo, Intel Core, Intel vPro, Core Inside and vPro Inside are trademarks of Intel Corporation in the U.S. and/or other countries. Other product names mentioned herein are for identification purposes only and may be trademarks and/or registered trademarks of their respective companies. © 2018 Lenovo. All rights reserved.
Contents
June 2018 VOLUME 23_ISSUE 04
INTERVIEWS 14
Revived and ready for market After more than 20 years, Melbourne IT rebranded to Arq Group in May.
20
A smarter way of doing digital DiUS helps businesses embrace digital.
ANALYSIS 04
Examining the state of digital transformation
20 48
28 38
Digital is dead Thor Essman debates digital.
Taking a specialised path to Australian expansion IntegrationWorks plans for future.
60
Going against the grain Nick Verykios outlines his next steps.
Placing bets on emerging technologies
IDG research outlines how companies
Surviving the digital storm
are evolving through technology.
requires technology service providers to make wise bets,
24
according to Chrissy Healey,
Top 5 technologies in the digital works
research director at Gartner.
Outlining the technologies that organisations are either piloting or researching in 2018.
36
Digitally transforming Australia’s retail industry Recurring influx of international competitors and rising shopper expectations have exerted a great amount of pressure on retailers.
44
Tackling the triple value play This Synnex Alliance 2018 roadshow debated customer value.
14
COLUMNS
60
26
Capital Gains: CentreRed
50
Start-up Spotlight
52
Channel Chat with HPE
64
Channel Confidential arnnet.com.au June 2018
02 Editorial AD INDEX
DIGITAL DISORDER
ARROW ECS ANZ BLUECHIP DICKER DATA HILLS HUAWEI I-LAN
13, 37 33, IBC OFW, IFW 17 9 53, 59
LENOVO IFC, OBC RHIPE 23 SYNNEX 11 TOSHIBA 3 VMWARE 41 WESTCON-COMSTOR 27
president and publisher
Susan Searle susan_searle@idg.com.au EDITORIAL editorial director :
James Henderson james_henderson@idg.com.au head of news : Leon
D
igital. A seven-letter word with a hundred definitions, including the obvious, the intriguing and the downright ridiculous. Such is the blank canvas of this type of transformation, transformation that is open to interpretation yet closed off to criticism. Unlike cloud — an area in which opinions still differ — digital transformation appears to have universal support from CIOs to channel partners. Perhaps the ambiguity of the technology allows enough room for every provider and vendor to play a part, creating a wave of
“Digital. A seven-letter word with a hundred definitions” market hysteria in the process. Digital is in disarray. With so much choice and industry chatter, customers are turning left, right, and around in circles trying to deliver on the promise of change. Our cover story this month features a partner tackling such challenges head-on, through knowledge and training. DiUS is a digital specialist acting as a launch pad for businesses, nurturing customers through the early stages of deployment, before educating internal teams to ensure change is long-lasting and fruitful.
June 2018 arnnet.com.au
It’s the digital equivalent of: Give a man a fish, feed him for a day. Teach a man to fish, feed him for a lifetime. And then, once the lesson is over, DiUS passes the baton. “We can move on so we are not caught looking after something for five or ten years, which is tempting because there are financial benefits,” observed Elliott Murray, head of technology at DiUS. “If you keep looking at the old stuff you can’t focus on the new.” In this issue, DiUS is joined by Arq Group, CentreRED, IntegrationWorks and Versent, complemented by in-depth IDG research uncovering the spending habits of customers in the context of digital. But it’s not all one-way traffic in favour of digital disruption, as outlined by Thor Essman, CEO and founder of Versent. “Digital transformation is probably one of the worst definitions in the history of technology,” he remarked, alluding that the concept of digital is already “dead”. This June edition highlights the innovation underway across Australia, qualified by the realities of pursuing digital transformation strategies. Definitions are plentiful, as are opportunities and challenges, but one thing is for certain, the debate will continue.
JAMES HENDERSON EDITORIAL DIRECTOR – ARN
Spencer leon_spencer@idg.com.au
journalist : Samira Sarraf samira_sarraf@idg.com.au journalist : Julia Talevski julia_talevski@idg.com.au graphic designer : Damon Taylor damon@taylormadedesign.com.au photographer : Christine Wong info@christinewongphotography.com
ADVERTISING Cherry Yumul cherry_yumul@idg.com.au (02) 9902 2756 account director :
account director : Eduardo Silva eduardo_silva@idg.com.au (02) 9902 2769 account manager : Jackson Raddysh jackson_raddysh@idg.com.au (02) 9902 2778 events manager : Amy Woodhead amy_woodhead@idg.com.au (02) 9902 2775 database and campaigns manager: Nik Gorbachev
nik_gorbachev@idg.com.au (02) 9902 2784
marketing and events coordinator: Christine Wong
christine_wong@idg.com.au (02) 9902 2737 managing director : idg founder :
Davy Adams
Patrick J McGovern
Editorial published in ARN may not be reproduced in any form whatsoever without written permission. Copyright 2018, IDG Communications ARN is published by IDG Communications Pty Ltd PO Box 1753, North Sydney, NSW, 2059. Phone: (02) 9902 2700
IDG is the publisher of ARN and its website (www.arnnet.com.au). If you choose to accept offers, enter competitions or complete surveys contained within them you may be required to provide information about yourself to IDG. IDG will use this information to provide you with products or services you have requested, and may supply your information to contractors that help IDG to do this. IDG may also use your information to inform you of other IDG publications, products, services and events, or give your information to organisations that are providing special prizes or offers and that are clearly associated with the offer. Unless you tell us not to, we may give your information to other organisations that may use it to inform you about other products, services or events or to give to other organisations that may use it for this purpose. To gain access to the information IDG holds about you, please contact IDG’s Privacy Officer at IDG Communications Pty Ltd, Level 10, 15 Blue St, North Sydney, NSW, 2060.
Windows 10 Pro means business.
EVERYONE IN BUSINESS K NO W S T HE VAL U E O F G R E AT C O NN E C T I O NS . X 3 0 W I T H 4 G.
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04 Analysis IDG
EXAMINING THE STATE OF
DIGITAL BUSINESS TRANSFORMATION NEWLY PUBLISHED IDG RESEARCH OUTLINES HOW COMPANIES ARE EVOLVING THEIR BUSINESSES THROUGH THE USE OF TECHNOLOGY TO DRIVE REVENUE AND INNOVATE AT THE POINT OF THE CUSTOMER. BASED ON 2018 DIGITAL BUSINESS FINDINGS, THIS REPORT PROVIDES THE CHANNEL WITH A DEEPER UNDERSTANDING OF HOW DIGITAL TRANSFORMATION PLANS ARE SHAPING INSIDE END-USER ORGANISATIONS.
June 2018 arnnet.com.au
D
igital business is described as the creation of new business designs by blurring the digital and physical worlds. As IDC describes it, digital transformation is the use of 3rd platform technologies to create value and competitive advantage through new offerings, new business models and new relationships. Connected devices are flourishing as predicted, with the number of connected Internet of Things (IoT) endpoints set to top 30 billion in 2020 and reach 80 billion by 2025, according to IDC.
But for most enterprises, the transition to a digital-first business model has been more cautious and methodical, according to IDG’s 2018 Digital Business survey. More than a third of organisations (37 per cent) have already started integrating and executing a digital-first approach, and seven per cent say they’re already an enterprise-wide digital business. Still, almost half (45 per cent) of IT and business leaders surveyed say their companies are in the very early stages of becoming a digital business — either gathering information or just beginning to
IDG Analysis
formulate a digital-first strategy. Organisations say their biggest obstacles in achieving success with digital business initiatives include lack of sufficient budget (39 per cent), lack of staff and/or correct skill sets (36 per cent), the need to replace legacy systems (34 per cent) and cultural issues (33 per cent). This underscores the huge business and cultural challenges that must be overcome to even begin digital transformation — not to mention the dizzying array of technology options that must be analysed and matched to business goals. The study finds that both technology and organisational change management must be considered equally.
Definition What does being a “digital business” mean to organisations? IDG surveyed 702 IT and business management decision-makers to find out. Respondents were given nine meanings of digital business to learn, to see which ones resonated the most with how their organisation views digital business. For about half of survey respondents,
89%
of organisations have adopted or have plans to adopt a digital-first strategy
“It is crucial for almost every business function to evolve”
05
becoming a digital business means enabling worker productivity through tools such as mobile, data access and artificial intelligence-assisted processes (52 per cent), and the ability to better manage business performance through data availability and visibility (49 per cent). For one-third or more of IT decisionmakers, it means meeting customer experience expectations (46 per cent), understanding customer needs through data collection and analysis (44 per cent). Furthermore, other definitions include providing secure, optimised anywhere/ anytime access to assets (39 per cent), digitally modifying business and/or processes (37 per cent), developing new digital business/revenue streams (33 per cent), and achieving top-line growth through digital product enhancements/new digital products or services (31 per cent). For more than a quarter of companies surveyed (27 per cent), it means digital globalisation — the flow of data and information worldwide which enables the movement of goods, services, finance and people. All of these objectives require a smart
arnnet.com.au June 2018
06 Analysis IDG
What does “digital-business” mean to organisations? Enable worker productivity through tools such as mobile, data access and AI-assisted processes
52%
Ability to better manage business performance through data availability and visibility
49%
Meet customer experience expectations
combination of technologies, both proven and some in their very early stages, to achieve their intended results.
Digital-first More than a third of organisations (44 per cent) have already started implementing a digital-first approach to business processes, operations and customer engagement. Some 19 per cent are in the integration process of making operational and technology changes throughout the enterprise, and 18 per cent are executing their digital plans and making process, operational and technology changes on a department and business unit level. Just seven per cent of companies have already fully implemented their digital-first approach and are in the maintenance phase.
46%
and they may be on the right track. Close to one-third of IT decision-makers (32 per cent) say that digital business has already helped their organisation achieve revenue growth, with an average of a 23 per cent increase. Meanwhile, 35 per cent of respondents say their digital-first efforts have not yet affected revenue, and another 30 per cent don’t know. Many companies, however, are in the very early stages of becoming a digital business. More than a quarter of organisations (28 per cent) are in the development stages of creating strategies, evaluating technology and the organisational changes that will be required for a digital transformation, and in delving deeper, 17 per cent are still
gathering information before they develop a strategy. The majority of organisations surveyed plan to spend a significant portion of their IT budgets on these initiatives. Twenty-one per cent of organisations will spend $1 million-$10 million on digital business initiatives, while 15 per cent will spend $10 million or more on digital business projects in the next 12 months. While 21 per cent of organisations plan to spend less than $1 million this year on digital business initiatives, the overall expected average spend is $14.3 million – which varies greatly by company size. Enterprise organisations (1,000+ employees) expect to spend $27.5 million compared to $1.8 million for SMBs (<1,000 employees).
Big expectations When asked what their organisation’s top objectives were for their digital business strategy, the majority of organisations expect to improve process efficiency through automation (64 per cent), create better customer experiences (58 per cent) and improve employee productivity (50 per cent). Some 43 per cent of organisations expect digital business to drive revenue growth,
June 2018 arnnet.com.au
32%
of IT decision-makers say that digital business has already helped their organisation achieve revenue growth
IDG Analysis
“Developing a digitalfirst strategy can get complicated”
Digital First Approach Not at all
Research
17%
11%
Maintenance
7% 28%
19% Integration
Development
18%
Public and private cloud
Execution
‘No thanks’ Although digital business is expected to improve productivity, better the customer experience, etc., 11 per cent of organisations have no plans of adopting a digital-first approach. When asked why, the majority say it’s due to budget constraints (32 per cent), while 15 per cent of IT decision-makers say they’re already achieving profits under their current business model. Developing a digital-first strategy can get complicated. Cloud, IoT, artificial intelligence, bots, software-defined storage and networking, application performance monitoring and mobile technologies are just a few to be considered. Here is how digital technology adoption is playing out:
Big data/analytics It’s no surprise that digital-first enthusiasts have already jumped on the big data/ analytics bandwagon. Big data/analytics helps organisations harness their data and use it to identify new opportunities. That, in turn, leads to smarter business moves, more efficient operations, higher profits and happier customers. It also drives process efficiencies and employee
07
productivity, which are primary goals of digital-first initiatives.
Mobile Technology The world is mobile, and enterprises have no choice but to adapt to workers’ and consumers’ habits. In the past, organisations shied away from integrating mobile technology because of the complex integration required with so many legacy processes and systems. Today, with more organisations now focused on digital transformation, it’s time to leverage mobile as an integrated part of business strategy.
IDC reports that organisations are shifting to a “cloud-first” strategy for updating/ replacing traditional systems and to “cloud only” when developing their nextgeneration competitive advantage systems and services, so it makes sense that most organisations already have public and private cloud in place. As organisations add digital-first technologies, public and private cloud will play a central role.
APIs Application Programming Interfaces, the language for getting systems to communicate and share data with one another, are becoming essential business tools for sharing data among siloed systems and external data-sharing to allow collaboration that can improve operations and customer service.
Top Five Digital Technolgies Already Implemented 59%
59%
53%
45%
40%
Big Data/ Analytics
Mobile Technology
Private Cloud
Public Cloud
APIs/ embeddable
arnnet.com.au June 2018
8
Analysis IDG
Which of the following steps has your organisation completed on its journey to becoming a digital business?
27% 24% 23% 22% 19% 18% 17% 15% 14%
Data security/ protection strategy IT skills assessment Developing a buisness case or roadmap for digital strategy Technology needs assessment
Workforce strategy Change management Data management strategy Determining the metrics of success Personal development
Next steps IT leaders are making steady and sequential progress to becoming digital-first organisations — though not at the same breakneck speed that the technologies themselves are proliferating. For many organisations, the foundational pieces are in place, and they’re actively working on adopting newer technologies like AI and IoT. But successful digital transformation will also require equal attention to change management and workforce strategy for the entire organisation. CIOs and top IT executives will play a central role on both fronts.
June 2018 arnnet.com.au
IDG’s 2018 Digital Business survey was conducted among the IDG audience via email promotions and social communities. To be considered qualified respondents must work in an organisation that has plans to adopt /or has already launched a “digital-first” approach. Results are based on 628 qualified responses. A broad range of industries are represented including high tech (16 per cent), manufacturing (12 per cent), financial services (12 per cent), government/non-profit (10 per cent), services (eight per cent), education (eight per cent), healthcare (seven per cent), retail, wholesale & distribution (six per cent) and advertising/ marketing/PR/media (five per cent).
10 Analysis Gartner
Placing bets on emerging technologies SURVIVING THE DIGITAL STORM REQUIRES TECHNOLOGY SERVICE PROVIDERS TO MAKE WISE BETS, ACCORDING TO CHRISSY HEALEY, RESEARCH DIRECTOR AT GARTNER. Chrissy Healy | Research director, Gartner
In the face of client expectations around a rapidly changing array of emerging technologies, it’s important to focus investment, incubate talent and partner effectively to ensure digital solutions deliver on business outcomes. Clients will continue to face rapidly accelerating technology innovation that will profoundly impact the way they deal with their workforces, customers and partners. To survive and thrive in the digital economy, emerging technologies can help them create competitive advantage, generate value, overcome legal and regulatory hurdles, reduce operating costs and enable transformational business models. According to a recent Gartner study, prescriptive/predictive analytics, machine/ deep learning, virtual assistants and IoT were ranked by enterprise technology buyers as the top emerging technologies for competitive advantage until the end of 2022. These enterprises have an expectation that technology service providers can speak to and have experience in the gamut of emerging technologies to support digital transformation. This provides significant opportunities for your business to educate, advise and
June 2018 arnnet.com.au
implement solutions leveraging these technologies. Therefore, it’s important to make investments that help clients reinvent how they deliver value and create innovative business models to leapfrog their competitors, while future proofing their businesses against disruption. This also means trying to achieve this in the context of a sometimes overwhelming competing resource allocation.
Don’t try to conquer the world Pursuing every new technology by investing in a team to build uses in each market and industry may be an option. However, moving the ship to obtain internal approvals, recruit or move staff, gain buy-in from across the enterprise and commence with building the knowledge and assets internally, is a herculean and likely untenable effort. Doing so across multiple technologies at the pace that technology is emerging in today’s market and at the speed and ease that clients are expecting, is a near impossibility for a large technology service provider, let alone a midsize or small service provider. By the end of 2022, Gartner predicts that technology service providers that focus
on and invest in digital services specific to one or two digital business subsectors will grow market share 25 percent faster than competitors addressing all subsectors.
Where to start There are three key activities that are important when designing your emerging technology investment strategy: • Focused investment: Determine a shortlist of emerging technology solutions for investment in developing intellectual property or solutions • Ecosystem strategy: Research and decide on which vendors of target emerging technologies to partner • Talent incubation: Create an incentivised centre of excellence to incubate skills, provide best practices, research and training As you make investment decisions, the rate of adoption for emerging technologies is an important consideration when determining return on investment, talent and partnering approach. These emerging technologies are changing the fundamental expectations, culture and behaviours of industries, markets and business functions. While analytics, machine learning, IoT and virtual assistants are at the top of the five-year investment horizon for clients, other emerging technologies are gaining in adoption and importance by the day. When selecting which emerging technologies will have the greatest impact on your clients’ businesses, understand their motivations related to each of these technologies. Making wise bets to ensure a targeted investment approach that doesn’t leave room for missing out in areas that are the most important is challenging. However, this challenge can be managed via a comprehensive ecosystem, platform and innovation investment approach. Chrissy Healey is a research director in Gartner’s technology service provider group, advising IT service providers on market opportunities, go-to-market and differentiation strategies, and end-user organisations on innovation, sourcing and vendor management.
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12 Capital Gains
A safe pair of hands in the capital IN 1996, KENT FORSTER TOOK THE INITIATIVE IN SETTING UP CANBERRA-BASED IT SERVICES BUSINESS, CentreRED — JULIA TALEVSKI REPORTS.
This was the same year that Liberal leader, John Howard took office, replacing Paul Keating in the hot seat. CentreRED originally started out with a single client. Fast forward 22 years, and the privately-owned business has now flourished to more than 100 clients, 24 staff and four directors. As well as Forster, the company’s directors include Adele Pickering, Sasha Hajenko and Hedley Middlebrook. “CentreRED has been a part of the Canberra business community for 22 years and we have grown alongside many of our clients,” Forster said. A prime example of this, is when in 2006, CentreRED partnered with a customer that had around 10 staff. And 12 years on, they have grown to about 1000 staff with CentreRED continuing their work and providing six permanent onsite support staff, spanning three states. With clients spread across the country, CentreRED itself, specifically focuses on providing comprehensive IT support with client tailored solutions including a streamlined range of managed product options such as managed back-ups, managed firewalls and managed wireless. The suite of managed services includes VoIP, hardware and software procurement, email/spam protection, business continuity planning, IT consulting and cloud services, and it maintains a firm commitment to adding to that list as technology continues to evolve and shape the market.
“We pride ourselves in our ability to offer staff augmentation solutions in multiple locations for high volume clients,” Forster said. “Above all, we understand the importance of collaborating with businesses to optimise their technology, we become business partners, not just IT providers.” CentreRED’s clients span not-for-profit organisations; property development and construction; and professional services such as accounting, medical services and consulting. Some of its specific partnerships include Microsoft, HP, Kaseya, ConnectWise, Telegate, Infinite and Datto. The company has scored some key awards along the way including Kaseya Innovation Partner of the Year in 2014 Kent Forster CEO, CenterRED
Dom Polegubic Director, ForwardIT June 2018 arnnet.com.au
and after being one of the early adopters of Datto’s back-up and disaster recovery technology in the market, it managed to pick up Datto A/NZ Partner of the Year in 2016.
Stability
Forster said providing stability was an important factor when it came to servicing customers. “CentreRED dedicates a lot of time to product research and development before we introduce it to our clients to ensure we are providing high quality products and solutions,” he said. “Ensuring that products and solutions a business offers are from reputable brands that are at the forefront of technology is always a challenge. “It is important to provide stability to our clients — providing solutions or products that have short lifespans can be frustrating for clients.” What’s CentreRED’s strategy for staying ahead of the competition? Forster mentioned they are members of a global peer group that meets quarterly to discuss business challenges and experiences; review currents trends and technologies; and work together to improve the businesses that participate in the group. Recently, the company implanted a business platform known as the Entrepreneurial Operating System (EOS), which is a structure to help work on the business; provide tools for the future; relevant planning and most importantly helps to develop and foster a great business culture where staff are valued and kept up-to-date with business successes and future goals. In the year ahead, Forster said it will continue to focus on partnering with its clients and growing its business to stay one step ahead. One way that it will be achieving this is through launching a new client satisfaction program that focuses not only on its day to day IT support, but also on its long-term relationships. “We’ll also focus more on our employees’ wellbeing and satisfaction because investing in our employees’ health and happiness is an investment in our own company’s health and happiness,” he said.
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14 Interview Arq Group
REVIVED AND FOR MARKET READY AFTER MORE THAN 20 YEARS, MELBOURNE IT REBRANDED TO ARQ GROUP IN MAY, HERALDING A NEW ERA FOR THE DIGITAL SPECIALISTS — JULIA TALEVSKI CHARTS THE CHANGE IN DIRECTION.
T
he digital transformation segment is tipped to add as much as $45 billion to Australia’s gross domestic product (GDP) in the next three years, a sizeable addition to an already thriving market. That’s according to IDC research, commissioned by Microsoft, which states that digital transformation benefits can vary from improvement in profit margin and productivity, to cost reduction and increased revenue from new products and services. The sheer size of the market opens a plethora of opportunities, if businesses retain focus on core offerings and are willing to change mind-sets. A company such as Arq Group — formerly Melbourne IT — is a leading example of this.
June 2018 arnnet.com.au
As the business embarked on a rebranding exercise in May, Arq recognised its own evolution since its foray into the market offering domain name and hosting services — stretching back to 1996 when born as part of a commercial venture with Melbourne University. Not long after, it was spun out and listed on the Australian Securities Exchange in 2000. And more than 20 years on, the Melbourne IT name, no longer fitted in with the direction of the business. The rebrand was just one part of a strategic step in recognising its own digital business services shift in the market since acquiring various businesses in the past four years. These acquisitions included online SMB services provider, Netregistry
in 2014; data and analytics provider, Infoready — which played a substantial role in completing Melbourne IT’s enterprise services strategy providing digital solutions for corporates and the government sector. This was soon followed up with its 2017 acquisition of app developer, Outware Mobile and digital marketing agency, WME Group in that same year.
Next chapter As CEO Martin Mercer reiterated, acquisitions have played an important role in the company’s growth and evolution, and the next chapter begins with unifying these businesses, cultures and people under the Arq Group banner. The company maintains a specific
Arq Group Interview
15
Safety first in Queensland Regulatory body for food production in Queensland, Safe Food Queensland, experienced issues with obtaining information fast enough or in a uniform fashion, from its chicken processing plants to prevent potentially unsafe produce hitting store shelves. Its variable, paper-based reporting Peter Wright Managing director of enterprise services, Arq Group
from the plants only discovered where the problem lay after the fact, so it undertook the journey to digitise existing systems so staff could identify potential food safety issues earlier. In partnership with Safe Food, Arq Group helped to create a platform to make self-reporting easier, faster, and uniform across all plants, which staff could easily learn to use along with Quality Control officers (QCs). To fully comprehend the customer’s pain points, Arq Group took the time to visit poultry production facilities, and ran workshops with QCs to understand how the product would be used, and what kind of adaptations were needed to make it work. As an example, the QCs own environment involved several challenges
focus on core technologies, which it internally calls CAMSS involving cloud, analytics, mobile, social and security. “We have built deep competencies across foundation practices including cloud, analytics and mobile, and then we have a continuous ‘evergreening’ service that supports those practises to help manage continuous change,” Arq Group managing director of enterprise services, Peter Wright, said. “We also work with organisations such as Tableau and Talend, to help with analytics, how we engage and bring to life some of the capabilities in analytics.” Wright recognises that there are two takes on the digital transformation segment being market-facing services and internalfacing services; along with a
technology-led versus a consultingled approach to the market. Arq Group, which is an Amazon Web Services (AWS) and Microsoft partner, placed its focus within market-facing, technology-led solutions. “They are the four quadrants that we look at to make sense of this large market,” Wright added. “Some organisations are still thinking about using digital in terms of building systems rather than building products, and so if you’re not prioritising that consumer experience, again, you’re not extracting the value of digital inside the organisation. “This is such a big, sustained market, we’re barely 10 per cent into what’s possible with digital transformation.”
with cold temperatures and thick gloves. To get around this, Arq created a simple navigation structure and increased button sizes to make the iPad app functional for QCs to enter data about temperature, pH levels, moisture, and other environmental factors within their processing plant. Through web APIs, the data is then accessible daily via dashboards, giving them the ability to analyse results against performance targets. As a result of the app, Safe Food has managed to significantly improve its reporting efficiency, reducing human error and provide instantaneous feedback. It can now assess potential issues before they occur. The success of the app will also see it expand further into other food areas to include red meat and potentially egg processing.
arnnet.com.au June 2018
16 Interview Arq Group
Wright said involvement with customers within their digital transformation journey, places an emphasis on helping them to build new products, services, channels, creating new wealth and opportunities. It is currently experimenting and working with a number customers on the artificial intelligence (AI) front. “That’s certainly going to become a much bigger part of the picture in the imminent future,” Wright added. “What we’re also going to see is several point solutions starting to come together into much more comprehensive solutions and that integrated consumer experience will become a much stronger pillar. “This is as organisations start to think about the ‘overall’ digital experience, as opposed to the very specific experiences that you have today depending on how you interact with that particular organisation or brand.” A prime example of this was working with banking institute ANZ and creating a chatbot called Polli. When employees had specific questions about policies, they were finding it difficult to get the right answers, quickly. As a result, the ANZ risk team wanted to create something that would help ease the process of wading through complicated policy documents. And so Polli was born entirely in AWS. Natural language tool, Amazon Lex, was a vital component in building a bot that resembled more of a human rather than a robotic voice. Because of this project, Arq Group is continuing to work with ANZ on giving Polli more features, delivering more value for employees.
Staying competitive Almost all large corporate and government organisations are looking to find a competitive advantage in some way through digital. Wright said that a lot of
June 2018 arnnet.com.au
organisations were also working hard to reduce the distance between their product/marketing organisation and delivery capabilities, but often left out the customer experience in their market-facing model. “Australian corporates today are still focusing on the relationship between product and delivery — and a lot of them are not yet mature in the emphasis and understanding of the ‘consumer’ experience,” he said. “The reason why? Traditional corporate structures have been built around business units — profit and loss, which is typically defined by several products, creating a very a strong identity of product in the organisation — there has traditionally been no organisational concept of the consumer.” A banking institute is a prime example of this model where they have various mortgage, institutional banking or wealth products, which are usually driven towards a specific customer base, but how do they build their ‘customer identity’ into
“WE’RE BARELY 10 PER CENT INTO WHAT’S POSSIBLE WITH DIGITAL”
a corporate structure that has been focused on product-based outcomes? “That’s a much harder transformation than bringing digital delivery closer to the product organisation,” he said. “I think the next big piece is actually creating ‘customer identity’ into large corporates, and this where the opportunity lies for us, because we’re helping to bring that customer experience into the organisation. “On the customer facing side, the biggest challenge is getting this concept and balancing the consumer experience with the existing product experience in an organisation.” Another piece in the digital puzzle is having the capability to measure outcomes and results of what has been built, to iterate and know what to do next to improve the product or service, Wright said. “What we’re still seeing in organisations is the need to build a product, get it to market, but the concept of evergreening the product, and keeping it ahead of the market, is still something that isn’t built into the culture of organisations,” he said. “You need to do that evergreening to extract the true value of going digital. A lot of organisations are still thinking traditionally in terms of building a product using digital technologies, but not measuring enough and iterating in the right way to keep that product ahead of the market.” When building a product or service, organisations should consider ease of use, whether it’s intuitive and the benefit it can provide. “If it doesn’t have all those things, why would the consumer choose to use it?” Wright queried. “From an internal context, some organisations are still thinking about using digital in terms of building systems rather than building products. “If you’re not prioritising that consumer/user experience, you’re not extracting the value of digital inside the organisation.”
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Start seeing the bigger picture.
18 What The Buyer Wants
The new Royal Adelaide Hospital (RAH) opened in September. At a cost of $2.3 billion, it is one of the most expensive buildings in the world. It is “without question” the most technologically advanced hospital in the country, says SA Health CIO and executive director of eHealth systems Bill Le Blanc. The RAH is home to a huge robotic pharmacy distribution system (one of the biggest in Australia); more than 100 automated dispensing cabinets in patient wings to support the accurate and timely distribution of medicines. In addition to telehealth facilities for staff to consult with patients across the state, digital imaging technology which allows clinical images to be streamed live from operating theatres and procedural rooms for diagnostic and training purposes; and the largest automated microbiology system in the southern hemisphere. The 800-bed facility will eventually provide care to an estimated 85,000 inpatients and 400,000 outpatients each year, and is also the state’s only public hospital to roll out a digital instrument tracking system to manage its vast collection of medical equipment. And complementing the new hospital’s world-leading care has been the statewide deployment of the Enterprise Patient Administration System (EPAS), which replaces paper medical records to significantly reduce medication errors and improve patient safety. RAH is, as Le Blanc put it: “truly a digital hospital of the future”, so impressive that the hospital had to urge members of the public not to use minor ailments as an excuse to get a look at the new facilities. But there are haters too. As well as rolling out the RAH’s extensive technology programme, an investment well in excess of $130 million, Le Blanc has had to fend off savage condemnation of his team’s work from media-savvy, vocal critics. “Technology is an easy target for them,” he said.
Patient focus Every element of the RAH has been designed to improve the patient experience
June 2018 arnnet.com.au
and health outcomes. The building is full of natural light and artwork, has numerous courtyards and sky gardens while the 100 per cent single overnight patient rooms – each with views over the River Torrens create the best possible healing environment with greater levels of privacy, comfort and infection control. The technology programme for the hospital, some four years in the making, has followed the same principles. “The technologies enable better clinical outcomes, lower costs, and higher throughput,” said Le Blanc, who has been with SA Health for close to a decade. “Every inpatient room is a single-bed room where technology enables many services to be brought to the patient – for example, mobile radiology units will x-ray the patient in their own room — rather than the patient having to be brought to the service.” A number of the technologies in place
are world-leading, “over and above what is typically found in a modern hospital” Le Blanc said.
People over technology The roll-out of the new technologies, and the EPAS system has been a huge challenge not just for Le Blanc, but hospital staff.
Bill Le Blanc CIO, SA Health
Examining the Royal Adelaide Hospital, and the CIO driving tech change THE ROYAL ADELAIDE HOSPITAL HOUSES SOME OF THE WORLD’S MOST ADVANCED TECHNOLOGIES, GEORGE NOTT ASSESSES THE WORK OF BILL LE BLANC, CIO OF SA HEALTH AND NUMBER ONE RANKED TECHNOLOGY LEADER IN CIO50 2017. Royal Adelaide Hospital Adelaide
What The Buyer Wants
“Two simple words: digital disruption,” Le Blanc said. “Disrupting almost every area of business and clinical operations that were previously performed manually. “The challenge of such significant change was compounded by people needing to make significant contributions to the project in addition to their ‘day jobs’. They’ve had to be simultaneously providing quality care in demanding circumstances at the old RAH.” To ease them into the new ways of working, mock-up patient rooms and operating theatres were constructed to help staff conceptualise the changes to their physical environment. At the old Royal Adelaide Hospital, a skills centre was established where staff could familiarise themselves with new technology they would be using technology hands-on. Technology has been explained and
featured in internal newsletters, across social media and spoken about at ‘Grand Rounds’, the hospital term for a town hall meeting. “I have learned that leading the technology function in a large complex organisation is much more about leading people than technology,” Le Blanc added. “Invariably technologists will be able to find a technology solution to a particular problem however the people management, cultural change, and business change management aspects are bigger issues for CIOs.”
Facing the critics There is resistance to every change in an organisation. Le Blanc and his team — given the scale and breadth of the change they are bringing — have faced more criticism then most. At times, it has cut deep. Last November Le Blanc and his team faced the wrath of
19
medical unions and the scrutiny of the national media after a glitch caused an outage in the EPAS. At last year’s CIO50 event Le Blanc brought a newspaper clipping with the headline ‘EPAS fails will be fatal’. He has appeared on talkback radio to defend the technology. In April this year the system was criticised by a coroner investigating the death of a patient. The system has even become a political football. In November, South Australia’s Opposition Leader, Liberal Steven Marshall said his party would pull the plug on the roll-out if elected in March. “Healthcare in any state attracts constant media scrutiny and is never far from the front page,” Le Blanc added. “In our business there are vocal critics of the changes we are making. “There are websites dedicated to opposing it. Technology is an easy target for them. They are savvy users of conventional media, social media, and industrial bodies to keep their views front and centre.” As CIO, Le Blanc takes it on himself to defend his team’s work, putting himself up as media spokesperson. “When this happens in our environment, my highly skilled and deeply committed staff feel they are being publicly attacked for the great work they are doing and it is important they see me at the forefront of defending the digital transformation program,” he added. In time, the end results of the technologies that have been introduced, and the positive effect on patient outcomes will speak for itself. “We have great people,” he said. “Outstanding, dedicated people. However, like any group, they require leadership so that they are doing the right things. It’s trite, but true, that culture beats strategy, which is why I maintain a strong emphasis on culture. “The key thing is that it’s not about me, it’s about the role that technology plays in such a large and complex organisation. The ability to take a business on a journey of transformational change, enabled by technology, I believe, is the most important skill that CIOs need today.”
arnnet.com.au June 2018
20 Interview DiUS
A SMARTER WAY
OF DOING DIGITAL
Elliott Murray Head of technology, DiUS
INSTEAD OF LOCKING CUSTOMERS INTO ARCHAIC LONG-TERM CONTRACTS, SAMIRA SARRAF EXPLAINS HOW DIUS HELPS BUSINESSES EMBRACE DIGITAL TECHNOLOGIES THROUGH KNOWLEDGE AND TRAINING.
F
or those in the world still wondering when Skynet, of Terminator fame, will take over the human race, take a step back and breathe. Artificial intelligence (AI), and the smart algorithms that run in the background, are already infiltrating the market en masse, but a future in which such technology will dominate daily life, is a little way off. Because while robots may have already arrived, with smart technologies in fast pursuit, the future outlined in Hollywood movies is not quite aligned to reality. Remember, not long ago, the
June 2018 arnnet.com.au
global population sent faxes, called landlines and wrote letters to friends and family — alien concepts to the millennial generation. “At the core, digital transformation is centred around how we apply technology to solve problems, or improve processes, or to innovate,” observed Elliott Murray, head of technology at DiUS. Headquartered in Melbourne, DiUS is a solutions provider with specialist expertise across the Amazon Web Services (AWS) platform, providing advanced consulting to customers such as Bauer Media Group, Jetstar and
Vodafone, alongside Nib, Medibank and MYOB, among others. For Murray, such transformation started many years ago, and continues to accelerate as the market evolves, as technology invades daily life through smartphones and digital devices, as well as in business through public cloud. Coupled with the rise of deployments specific to the Internet of Things (IoT) and AI, new solutions are emerging to transform the way Australia does business. “We’re already able to carry out great speech and image recognition, image, self-driving cars and that is going to carry on,” Murray explained.
DiUS Interview
at the end which is your ability to innovate and improve your internal processes while making new opportunities,” Murray added. “And obviously, these technologies [IoT and AI] allow you to do that.”
Defining digital
CHRISTINE WONG
But it’s not only a case of new technologies, rather how to keep pace with rapid levels of innovation, as businesses attempt to take advantage to avoid falling off the track. In assessing a competitive industry, Murray cited the work of organisations from the S&P500, which lists the 500 largest companies with common stocks listed on the NYSE or NASDAQ based on market capitalisations. These organisations were able to remain in the list for around 30 years during the 1960s, whereas today, an enterprise might only last for 10 years. “There is a real tangible thing
Perhaps it’s a little presumptive to discuss the benefits of digital transformation, without first defining the technology. A clear explanation remains lacking however, as customers, partners and vendors project varied thoughts and ideas onto a blank canvas spanning the entire technology market. In short, defining digital transformation really depends on the business, the use case and the technology. During his address at CeBIT in Sydney, finance minister Victor Dominello tackled the subject headon, debating what such a shift in thinking means for the market and crucially, “why are we doing it?”. “Is digital transformation about digitising paper processes to enhance efficiency?” he asked. “Is it about automating repetitive tasks to reduce efforts and errors? “Is it about employing AI to improve decision making or is it implementing gadgets and devices to give us greater control over our environment? “Now if you are thinking all the above then you are probably right, but for me digital transformation goes way beyond that. The essence of digital transformation is about transforming human societies and improving the human condition.” Dominello believes that digital transformation can be leveraged to help plan a better city, reduce homelessness, improve health care, protect the environment, advance education, decrease the tax burden and more. For Dominello, digital
21
transformation is about achieving real world outcomes. In response, Murray acknowledged that the notion of digital goes beyond an organisation, moving into the daily lives of the public. Murray recalled a time as a child when mobile phones didn’t exist, during an era when fixed lines where still a mainstay in the house. Fast forward to today and Wi-Fi spots are everywhere in the city, allowing people to access the internet free of charge. “Will we even need a SIM card in five-years’ time?” Murray asked. Considering changing market dynamics, DiUS is diving deeper into the smarter side of digital transformation, chiefly AI and machine learning. “You start to see organisations like Google already say, ‘we’re no longer a mobile-first organisation we’re an AIfirst organisation’ so we’re very much focused on AI,” Murray added. This is where DiUS is playing today, and according to Murray, will still be playing by 2023. During the next five years, DiUS will continue to offer similar services but will do so alongside a portfolio of AI-enabled solutions, built to create more augmented and engaging experiences. “Now we’re doing more and more IoT work where there’s less players in that space and quite a few small bespoke data science shops,” Murray added. “Our unique play is that we do the whole end-to-end offering with customer user experience, plus we do some DevOps as well as an agile approach to product management.”
Pace of change In taking a global view of the market, worldwide spending on digital transformation technologies — spanning hardware, software and services — is expected to reach almost US$1.3 trillion in 2018, representing an increase of 16.8 per cent from 2017.
arnnet.com.au June 2018
22 Interview DiUS
According to IDC research, the majority of spending this year (US$662 billion) will go toward technologies that support new or expanded operating models as organisations seek to make operations more effective and responsive by leveraging digitally-connected products/services, assets, people, and trading partners. The second largest investment area (US$326 billion) will be technologies supporting omni-experience innovations that transform how customers, partners, employees and things communicate with each other and the products and services created to meet unique and individualised demand. For Murray however, the trigger point for increased spend is simple. “If you go back to the 1980s, Kodak actually invented the digital camera and they didn’t innovate after that,” Murray added. “Then there is Blockbuster, who uses Blockbuster anymore?” As explained by Murray, the advantage streaming giant Netflix had over Blockbuster, apart from being a big power player, was that it did not have large quantities of stores, taking advantage of being an online-only platform. Closer to home, insurance provider Nib is an example of a business that doesn’t require bricks and mortar stores, yet chooses to provide a select few to cater for the needs of a varied customer base. As a customer of DiUS, Nib offers digital services for most, if not all, its services, but recognised the importance of keeping a few shop fronts to allow customers who prefer the human touch to transact as normal. DiUS worked with Nib to create Nibby, the company’s chatbot. According to Murray, this was the first time an Australian health insurer introduced AI services to assist customers with health insurance enquiries.
June 2018 arnnet.com.au
“We wanted to test the hypothesis that using a chatbot could improve the customer experience and free up our live agent’s time, and we wanted to test the concept quickly — both from a technical and user perspective,” Nib CIO, Brendan Mills, said. “By partnering with DiUS we were able to take an innovative idea and build it on top of our cloud platform. Together we moved through a proof of concept stage and into production in an agile manner to quickly deliver an improved customer experience.”
Customers Given the advancements of AI and ML locally, Australia is witnessing professions that have avoided technology innovation for a long
time, becoming disrupted almost overnight. This might be the case with lawyers, because finding the right first-contact advice might now be achievable through the help of a chatbot. For Murray, the industry is reaching a point in which AI can ask enough questions of people to be capable of providing the correct advice in return. In addition, Murray also quoted Stanford professor Andrew NG, co-founder of Coursera — a venturebacked, education-focused technology company — who said, “pretty much
anything that a normal person can do in less than one second, we can now automate with AI”. “It will be interesting to see if some of that gets disrupted,” Murray added. “I feel like some of those professions have been hard to replace by traditional technology and I think we might see some movement in that during the next five to 10 years.” In Australia, Murray has noticed a movement from fintechs in recent years towards digital adoption. “A lot of fintechs have come around and I know the Big Four are also trying to embrace it because they can see that they are going to get disrupted,” Murray observed. “They’re even funding their own disrupters, if that makes sense, because they know that if they don’t somebody else will.” Specific to customers, Murray said DiUS had two choices in the market. First, remain with customers for the long-term and ensure financial stability. Or second, train the staff of customers and instead focus on new projects and explore emerging technologies as they remain relevant. The business picked the latter. Murray said that small organisations might come to DiUS in order to get a start-up idea to market — DiUS will start the project and then train the staff. “Eventually we’ll start rolling their people through so they can start taking over it and eventually we will roll off,” Murray added. “We get the thing up and running in a good healthy way, train their people and eventually they get to have their own function. “We can move on so we are not caught looking after something for five or ten years, which is tempting because there are financial benefits. That stops us from looking at the next thing and that takes a lot of energy. If you keep looking at the old stuff you can’t focus on the new.”
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24 Analysis IDG
TOP 5 TECHNOLOGIES IN THE DIGITAL WORKS Artificial intelligence
Machine learning
As artificial intelligence (AI) proliferates, it’s becoming an imperative for businesses that want to maintain a competitive edge. AI can process and analyse massive amounts of data far more quickly than the human brain. It can then recommend a course of action based on the data. Rather than replacing humans, AI can help them map out the consequences of actions and speed up the decision-making process. What’s more, AI software can make decisions on its own, making it valuable to a wide range of industries for everything from answering customers’ questions to predicting when factory equipment will break down.
Machine learning (ML), a subset of AI, is a technology that allows systems to learn from data and continuously improve from experience, without being specifically programmed. Deloitte Global concurs with IDG’s findings in a recent report, 2018 Global Predictions: Machine Learning – Things are Getting Intense, which says that while organisations are highly enthusiastic about the potential of cognitive technologies like ML, the majority had just a handful of implementations and pilots in the works. Deloitte contributes their caution to a lack of qualified practitioners, and immature and
Top Five Digital Technolgies In The Works (Piloting, researching or on the radar of organisations in the next 12 months)
56% Artificial Intelligence
55% Machine Learning
June 2018 arnnet.com.au
50% Internet of Things
45%
44%
Software Defined Software Networking Defined Storage
NEWLY PUBLISHED IDG RESEARCH OUTLINES THE KEY TECHNOLOGIES THAT DIGITALLY FOCUSED ORGANISATIONS ARE EITHER PILOTING OR RESEARCHING DURING THE NEXT 12 MONTHS.
IDG Analysis
49%
IT decisionmakers say IoT plays a role in their digital business strategy • 61% enterprise organisations • 39% SMB organisations
still evolving tools and frameworks for ML, among other drawbacks. Still, the consulting firm predicts that the number of ML implementations and pilot projects will double in 2017, and then double again by 2020.
Internet of Things Internet of things (IoT) devices are going to have a big impact on how companies do business. For starters, IoT devices collect massive amounts of data, and companies will have greater access to this data than ever before to track and record consumer behaviour to make smarter advertising and targeted demographics decisions. IoT will also likely revolutionise how companies track and manage their inventory, further enhancing remote work and improve efficiency and productivity at work. Close to half (49 per cent) of IT decisionmakers say that IoT plays a role in their digital business strategy, with greater use among enterprise organisations (61 per cent) compared to SMBs (39 per cent). Currently, IoT is primarily being used to manage IT assets on performance, risk management, compliance and security (57 per cent), monitor equipment (53 per cent) and collect customer or product data via sensors (41 per cent), to name a few functions.
25
Software-defined Software-defined networking (SDN) technology can create more efficient, centralised networking management, reduce operating costs, and enable new technologies in the organisation. With SDN, the network can direct traffic without relying on the hardware to make the decision. This capability has become critical to readying companies for new technologies such as cloud-based applications, IoT devices, and big data applications. Likewise, software-defined storage (SDS) is helping many industries better manage their growing stockpile of data by providing flexibility in how they store and retrieve data.
Not ready Almost half (44 per cent) of IT decisionmakers say they’re not interested in adding virtual reality or bots to their technology arsenal right now, but they may want to change their minds in a few years. A solid 29 per cent of organisations are researching AR/VR, and 14 per cent are already piloting; and the status is similar for bots. Meanwhile, 26 per cent of organisations are researching while 13 per cent are piloting bot technology. Today most people think virtual reality is geared toward gamers or the entertainment industry, but the technology is slowly moving to a wider audience.
Next steps
Top Two ‘Not Ready for Prime Time’ Technologies (Companies “not interested” in these technologies in coming year)
44% Bots
44% Augmented Reality/ Virtual Reality
In order to become a fully digital business, there are necessary steps and actions that organisations need to complete. The pace of technology change management runs slightly ahead of organisational change management for most organisations undergoing digital transformation. Over half of organisations have data/ analytics, mobile technology and private cloud already implemented in their organisation; and over half are piloting or researching AI, ML and IoT for use in the next 12 months. Yet, only 19 per cent have fully implemented a workforce strategy. Organisations are still in the process of determining roles and responsibilities while adapting the culture of the organisation to the new digital-first environment.
arnnet.com.au June 2018
26 Analysis Tech Research Asia
Digital is as digital does WHAT CAN BE ADDED THAT HASN’T ALREADY BEEN COVERED IN THE TSUNAMI OF CONTENT COVERING DIGITAL TRANSFORMATION? TECH RESEARCH ASIA ANALYST, JENS BUTLER, TAKES A DIFFERENT APPROACH.
Like any good industry-changing shift the phrase du jour is party to substantial hype. How do we define it? Is it something societal-changing – as stated by i-scoop – “…the profound transformation of business and organisational activities … and their accelerating impact across society.” Or is it just good old business process reengineering (BPR) repackaged allowing us to engage with a new wave of experts – “… revamping the business strategy or digital strategy, models, operations, products, marketing approach, objectives … by adopting digital technologies.” Digital is in the eye of the beholder and we should avoid getting too hung up on the definition. Digital is not about making everything digital, it’s about what we do with the digital information and infrastructure to improve processes, enhance decision making and create a more customer-centric offering.
June 2018 arnnet.com.au
Why is it different this time?
Yes, digitisation can lower entry barriers, allow agile competitors to play, enhance interactions across supply and engagement ecosystems and enable new operating models (on-demand, peer to peer). But where it is beginning to resonate is its expansion well beyond the IT industry and this is where budgets increasingly sit. Add to this the growing awareness of industry trends and shifts, and the FOMO effect, which is certainly driving a broader and faster adoption than previous waves.
Hype
At the moment, though, there seem to be two sides to the digital coin. If you talk with the supply side, digital is their current raison d’être and is deeply embedded in their corporate DNA. Providers, in one format or another are re-orienting capabilities to service this digital opportunity — not just as implementers, but as aggregators and guides.
So much so that the likes of Accenture have spent over US$2 billion in the past three years acquiring all manner of digital capabilities (from programming tools to analytics firms, cloud enablement offerings through to fully-blown advertising and marketing agencies). On the buy side, there is a high level of interest. However, there is a gap between desire and real, tangible action and at moment this lag equates to between nine and 18 months. According to the McKinsey Global Institute’s Industry Digitisation Index, even the USA is only operating at 18 per cent of its digital potential.
It ain’t easy
There are challenges, and they are not uniquely associated with the digital opportunity. Understanding and defining tangible outcomes (and interdependencies) of such a programme of work must be clearly communicated and managed — and frantically buying a broad mix of “best in class” niche cloud and AI applications just to be seen to be doing something has the potential to do more harm than good. We are dealing with people and the complex organisms that organisations have become. Resistance to change is part of human nature — and this is not purely with employees. The “what is in it for me” question will arise — and employees, partners and stakeholders will need to see the value associated with any digital engagement.
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28 Interview Versent
D I G I TA L I S D EAD AUSTRALIA IS A MARKET EASILY INFLUENCED
BY MARKETING AND BAMBOOZLED
BY STATISTICS. YET FOR THOR ESSMAN,
THE VERY NOTION OF DIGITAL
REMAINS MISGUIDED â&#x20AC;&#x201D;
JULIA TALEVSKI EXPLAINS.
June 2018 arnnet.com.au
Thor Essman - CEO, Versent
Versent Interview
29
D
“WE BELIEVE THE IDENTITY EXPERIENCE IS THE MAGIC IN THE MIDDLE”
Thor Essman CEO, Versent
igital is dead — three hard-hitting, and given the current climate, controversial words. But when sitting down with Thor Essman, CEO and founder of Versent, such a belief remains unwavering, despite a market saturated by hype and conjecture. “Digital transformation is probably one of the worst definitions in the history of technology,” said Essman, speaking as a former chief technology officer at National Australia Bank. “I say that because everyone’s concept is different. “Digital has grown up in the past 10 years, and it’s really starting to mean primarily, the user and customer experience that you have with interacting with a product or service online. “We lose ourselves a little bit in the experience of the things when it comes to the front end, the pretty end, but we forget the experience of these things is mostly about my entire end-to-end experience with you as a customer.” For Essman, website and mobile applications represent the “easy” side of digital transformation, with the real market differentiator housed within “identity” experience. “At the heart of almost every business transformation is the redefinition of identity experience,” he explained. “We believe the identity experience is the magic in the middle that allows you to bring actual customer experience in line with user experience and in line with developer experience. “This is very important in the API [application programming interface] world to truly represent your brand experience.” Essman said most customers experience the same challenge regarding the evolution or revolution of core technologies. “People are looking for simple, revolutionary solutions to consume as-a-service, but they’re also evolving their legacy systems and in both
arnnet.com.au June 2018
30 Interview Versent
directions, the API is becoming the battle ground,” he observed. “There’s almost not a company that I know of, that is not embarking, executing or considering a non-trivial transformation for APIs. “We’re craving the openness and transparency of information; the protection and the structure of identity, and that is the experience that matters to us, but the prettiness of how it looks, is not a feature anymore, it’s just expected. “What truly makes a successful digital transformation is the entire experience, which is anchored in both identity and API.”
“THE DAYS OF THE IT GENERALIST ARE SOMEWHAT GONE; THE DAYS OF SPECIALISTS ARE HERE”
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Service NSW An example of marrying the customer’s identity to experience, is the work that Versent carried out with Service NSW through implementing a central, federated API framework, with the specialist provider selected to help achieve a digital strategy roll-out. Prior to engagement, the NSW Government was operating across a number of individual web portals and back-end legacy systems, with limited integration abilities and multiple usernames and passwords for its citizens. The department realised it required a digitisation strategy to connect its multiple processes and platforms, creating a seamless customer experience while ensuring customer data was secure. Furthermore, the organisation needed to provide a platform for the re-use of compliance and proof of identity transactions across agencies which would reduce the time needed for individuals and small businesses to interact with the NSW government. A key aspect of Service NSW was that citizens could use multiple methods of identification from tax numbers to social media accounts, to securely access information and services. To accommodate this, the
portal needed to be integrated with the NSW’s customer servicing platform. Service NSW required the customer servicing platform to also act as a single, central source which could interact with other government agencies’ existing systems, with appropriate controls, to provide access to relevant citizen information. To expose the platform’s APIs to the NSW Government agencies, Versent built an API gateway using a CA Technologies’ solution into the Service NSW architecture, with the gateway designed to manage APIs and offer secure access to associated information and services. In providing the foundations for the Service NSW API gateway. The implementation began in May 2015, with Service NSW’s first digital services going live four months later in September. “The APIs could be added quickly and easily, allowing them to be consumed by the citizen portal, mobile applications or agency microsites to expand the services provided to citizens,” said Ben McMullen, now CIO of Service NSW. The solution has allowed Service NSW to rapidly provision services to several NSW government agencies, with the APIs sitting at the heart of the agency’s digitalisation strategy. “The best part of Service NSW is the ability to singularly aggregate who I am as a citizen into all NSW systems to single portal and having one username and password to interact with government,” Essman added. “That has been heralded over the last two years and it has set a benchmark for some of the singlesign on standards that really should be the core experience of how you interact — not just with government, but also with the customer-facing enterprise.”
Overcoming obstacles The sheer volume of technological choice and the speed of its delivery to
Versent Interview
the market, is a daunting experience. Whether a customer should go from on-premises to the cloud, is no longer a debate, it now boils down to the efficiency, keeping up with the pace, and how far behind companies are in cloud adoption cycles. Essman said one of the main challenges customers face is enabling legacy systems to operate in a twospeed economy. “We all know we can do things more efficiently and quickly and without the speed of change, it’s hard to do,” Essman added. “The race to the cloud, it’s not a question of if you’re going to go, it’s a question of how far behind you are, and can you catch up?” Delving deeper, Essman said cloud also challenges the traditional “middle” or brokerage style of delivering technologies through methods such as distribution. “There’s a definitive ‘us and them’ feeling across the industry at times because some of the things that were very traditional around how we sell things in the last 20 years, kind of don’t exist, and that’s tough,” he added.
True partnership Versent, which operates as an Amazon Web Services (AWS) specialist in Australia, recently took on a project with property developer, Mirvac. The Melbourne-based provider was tasked with migrating critical workloads to AWS, identifying 112 workloads, including the 180 Windows servers hosting those workloads. The entire project was planned, implemented and migrated within seven months, without any outage. As recalled by Essman, this was delivered by a Versent team of just four people, more than meeting the company’s need to have the project completed quickly. “We worked directly with their embedded team, shoulder-toshoulder, through the good, bad and ugly — the easy and hard tasks,” Essman said. “We were able to take
their business from a standing start in Amazon, to all-in, in a very short amount of time. “Seeing what they’re now enabled to do with their speed and be able to change, you’ll really start to see some exciting things happening with them and we’re happy to be a part of that. This how we were able to do things conjoined with a customer — not us doing it to them, but as an actual partnership.” On top of this, Versent also built a migration factory with automation, to help orchestrate the migration of all on-premises servers into AWS. For each server, Versent worked closely with Mirvac to ensure they were both functionally and operationally accepted by all involved, prior to any server being handed over. And once the workload was in AWS, Versent partnered with the operations team to put workload schedules in place to optimise usage and cost. Today, Mirvac is now reassured the new platform can scale and grow with business aspirations, while taking advantage of new capabilities such as machine learning and artificial intelligence. Creating a “true partnership” with customers was one the drivers behind Versent’s establishment in 2014. Along with Essman, the other company founders include CTO, James Coxon, and CISO, Eddie Smith. Prior to starting up Versent, Essman himself was on the customer side, working for National Australia Bank for around seven years in various technology roles, alongside stints at Optus and Adilon. In examining the start-up’s growth during the past four years, Essman acknowledged that it required consideration pre-launch to assess whether Versent could exist in a market through delivering outcomes in different ways, through different technologies. “I think we were very fortunate
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with the market dynamics and growth of cloud, the API economy, and the growing need to really focus on identity and now data,” he added. “I think just being a bit different in some of those key values has really helped us to accelerate and really stand out as a business.” Maintaining focus on core specialities is also another area that Versent homes in on, specifically focusing on cloud with AWS, API (Apigee), identity (Ping Identity) and data. Essman said these are the main ingredients customers need to be immersed in the digital sphere. “It’s just not possible to maintain quality if you don’t focus,” Essman explained. “It is impossible to be a master at everything. Therefore, you must pick the things that you’re going to be the master of. “The days of the IT generalist are somewhat gone; the days of specialists are here.”
Next steps
Another factor that is impacting the way in which people currently work and live, is “voice” activated technologies and this is one area that Versent is keenly focused on — rather than the concept of just going “mobile”. While the voice interface in its current state can be considered clunky and still requires fine tuning, the industry is just scraping the surface of the potential for natural language communication between users and devices, according to Essman. “That interface of natural language communication between us and our devices, is going to be the way we do things, because it is the way we live our lives,” Essman added. “We’re very much about helping voice transport through the enterprise through things like APIs, and we’re focusing on that versus focusing on mobile. We think mobile will always be around, but that was last year’s fad, not for the next year.”
arnnet.com.au June 2018
32 Analysis Robert Half
Top tech workers likely to get salary increases this year THE AUSTRALIAN EMPLOYMENT MARKET IS SUFFERING THROUGH SLOW WAGE GROWTH BUT IF YOU’RE A TOP TECH WORKER, YOU’LL LIKELY GET A PAY RISE THIS YEAR — BYRON CONNOLLY EXPLAINS.
Almost every local tech boss surveyed by recruiter Robert Half is planning to award salary increases to an average of 21 per cent of their IT staff with an average increase expected to be eight per cent. This is well above the national wage growth of two per cent. As IT employers battle an ongoing skills shortage, offering a competitive salary to secure top talent is often the most persuasive incentive, particularly in an employment market where 82 per cent of Australian CIOs finding it more challenging to source qualified IT professionals compared to five years ago, the recruiter said. Robert Half believe CIOs are now realising the need to re-evaluate their employee’s salaries with 98 per cent of 1000 Australian office workers responding to another survey saying they would be willing to accept another job offer with a higher salary. They would do this if they felt they were not being paid a fair salary by their current employer. Companies that fail to regularly review their employees’ compensation risk losing
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their top performers to the competition, which is particularly true for IT workers as jobs in the tech sector are growing, said Andrew Morris, director of Robert Half. There will be 722,000 workers in the tech sector in 2020, up from 600,000 in 2014. “In this booming market, IT professionals with niche skillsets are finding themselves in high demand and are more likely to gravitate towards higher paying roles,” Morris said. “Employers who do not regularly benchmark their employees’ salaries against industry standards will risk having their top performers gravitate towards more competitive pay packages elsewhere.” Morris suggested that employers should regularly review salaries and consider benchmarking salaries as an investment with a solid return rather than as an unwarranted expense. This can result in the retention of top performers and uninterrupted and uninterrupted productivity. “Awarding a competitive salary can also serve to distinguish the organisation as an employer of choice, particularly in a skillsshort market with growing scrutiny over
wage growth,” Morris added. “For employers who are not in a position to award higher pay, these reasons need to be properly communicated to any employees who feel they are underpaid. Managers need to address employee concerns about salaries and discuss alternatives for reviewing salaries in future. “Providing a timeframe on when they will receive a salary increase, as well as the necessary steps required by the employee to achieve this, is essential to keeping team members motivated.” Meanwhile, the top three tech positions in demand in Australia are cyber security specialist, full stack .Net developer, and cloud engineer. A CIO or CTO with highly relevant experience for a role can expect to earn $250,000 in Brisbane; $380,000 in Melbourne; $300,000 in Perth; $300,000 in Sydney; and $260,000 in Auckland, according to the recruiter’s research. This article originally appeared on CIO Australia.
34 Interview Westpac
WESTPAC CIO ON BANKING’S NEXT TECH BATTLEGROUND WESTPAC CIO, DAVE CURRAN, BELIEVES THE BANK’S STAFF NEED TO BE COMFORTABLE WITH CONSTANT CHANGE — GEORGE NOTT REPORTS.
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he CIO of Westpac Banking Corporation has revealed what he sees as the banking sector’s next “battleground for technology”. “It’s actually not about technology,” said Dave Curran, when speaking at Oracle CloudWorld in Sydney, “it’s about resource. How do actually find the capability?” Given the shortage of available technology talent in Australia, a new approach to finding required skills was needed, Curran said. “I’m strongly of the view that the way we develop talent has got to change,” he explained. “Where technology is going is ending the old model of ‘that skill is now redundant therefore that person is now redundant, I have to go and hire the new skill’. That’s not possible.”
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The bank is instead training its staff in an “ever growing skill set”, and preparing them for a new world in which “change is our constant” he said. Westpac’s rivals have also been mounting major employee training programmes in recent months. NAB in April launched a company-wide training program — the NAB Cloud Guild — to up-skill more than 2,000 employees in cloud computing. In August last year, ANZ rolled out ‘scaled-agile’ approach to work, with training for hundreds of staff. In another initiative, the bank encouraged its staff to become “their own little data scientist” providing easy-to-use tools for them to draw value from the bank’s fast-growing data lake. CBA since 2015 has offered staff online cyber security courses, in
partnership with UNSW. Westpac last year launched an internal IT ‘university’ with online courses on future technologies. But as well as taking on new skills, staff needed to become comfortable with continuous learning and fluid roles, Curran said. “And most human beings, particularly those that work in industries with technology, are predominantly introverted people who don’t particularly like constant change, and yet constant change is where we work,” he added. “The biggest challenge of the next five years is not how we leverage cloud, it’s not about how we leverage big data, it’s actually how do we build the skill sets in our teams when we can’t just go to market to get them.” “For our employees that’s a
Westpac Interview
tech savvy and technology people are becoming business savvy and in my mind not fast enough, but we are going quickly.” “I’m hoping [the IT people, business people split] disappears as a concept,” Curran continued. “The idea of IT and the business suggests an ongoing tennis match. New methodologies, new approaches changes that. But the concept an IT person doesn’t understand the business they work in, I think is one that has to end very quickly. “And similarly, the concept you can work in a business and not fundamentally understand the IT that supports the business is something I think won’t last as well.” It isn’t just staff being trained up at Westpac. The bank has around 15 artificial intelligence initiatives underway across various business units. Westpac can’t simply wait for the technology to advance, Curran explained. “People still think of it as a new technology. It’s actually not, it’s a
wonderful opportunity whilst also being a challenge and I think that’s our biggest battleground,” Curran, who joined Westpac from Commonwealth Bank of Australia in 2014, added.
Agile Around 4,000 Westpac employees work in Agile teams. That in itself was giving them new perspectives and abilities, and bringing about a necessary breakdown in the concept of ‘IT people’ and ‘business people’, Curran explained. “About three or four years ago several my colleagues turned up to work in black t-shirts because they thought that made them tech savvy,” he added. “And then discovered that wasn’t the answer. People are becoming
“I’m strongly of the view that the way we develop talent has got to change” capability that has to learn. The analogy I use is it’s like hiring a 17-year-old. A really smart 17-yearold but still a 17-year-old,” he said. “You’re not going to let them loose on day one, you’re going to have to take a few years developing their skills. So, the big challenge for our business is how do you hire 17 year olds and give them time to learn? “Rather than doing what you normally do and wait until the
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technology is advanced and hire someone who has already learnt. You have to start that work now.”
A royal mess The bank’s executives have been facing tough questions at the Banking Royal Commission in recent weeks. The commission has already exposed ineffective controls around lending at Westpac, kickbacks being paid to financial advisers and that it received fees for advice that wrecked the finances of customers. While not commenting on any specific findings – “I don’t know what you’re talking about” Curran joked – the CIO said the Commission’s findings were “symptomatic of the challenges we see”. “As organisations realise they don’t sell product they provide services – that’s a massive shift,” Curran added. “One of the things we’re seeing in the Banking Royal Commission, we’re seeing that shift is hard. It’s really hard, and how you manage that in large organisations can be done a lot better. “I think trust in large organisations – be they corporates, be they large banks, be they governments – is something that we are challenged with in the 21st century and technology is both providing that challenge and offering solutions to that challenge.” Banks needed to become more transparent to win back that trust, Curran added. “I think that’s the largest challenge,” he said. “How do you make large organisations transparent? “I think the technology is there to do that, but you have to open up that base level technology, that core business logic and data, not just the things that sit on top of it.” This article originally appeared on CIO Australia.
arnnet.com.au June 2018
36 Analysis IDC
Digitally transforming Australia’s retail industry AUSTRALIAN RETAILERS ARE UNDER A GREATER AMOUNT OF MARKET PRESSURE AS DIGITAL DEMANDS INCREASE — JAIDEEP THYAGARAJAN EXPLAINS. Jaideep Thyagarajan | Senior market analyst, IDC
Loss of market shares and the ensuing liquidity crises — decreasing cash flow, increasing debt concerns, skipping dividend payments and growing pressure from stakeholders — have challenged local retailers to find a way to improve their overall health. In addition, Australians are witnessing near-frictionless experiences online. With so many online and brick-andmortar shopping options available and with e-commerce making it easier than before to hop from one retailer to the other, the best shopping experience an average Australian has today is becoming the expected and least acceptable shopping experience anywhere. Above concerns have compelled Australian retailers to explore the opportunity in digital transformation and identify areas to transform operations and reinvent customer relationships. Digital has forever changed the way Australians engage with brands, and in response, the retail industry is undergoing a seismic shift toward offering customercentric, hyper-personalised, digitally– physically converged experiences.
Innovation
In an industry as hyper-competitive as retail, IDC Retail Insights believes that Australian June 2018 arnnet.com.au
retailers that harness digital transformation to transform their enterprises will have a competitive advantage over laggards that fail to unleash the innovation that emerging technologies drive. IDC research reveals that digital is core to the business strategy of 71 per cent of Australian organisations. As they get on with their digitisation efforts, it is important to understand that digital transformation is not simply a step change but a tectonic shift toward the future. This kind of exponential shift is not easy and requires a true interdisciplinary approach that encompasses all aspects of the business and all levels of management. In response to a recent survey about innovation, nearly half of the retailers cited creating new business models and developing new digital revenue streams as a top priority, while 46 per cent of them stated that creating a competitive advantage is importantly a primary mechanism to differentiation for retailers going forward. The race is on for the first click, where retailers must become the go-to resource for the consumer and be able to influence demand. Search and browse have become synonymous, and consumer experience is the touch point that drives growth. Consumers will flock to the retailer
or site that consistently meets or exceeds expectations and delivers a frictionless “best” experience. But advancing digital transformation requires next level of technology readiness — infrastructure scale, agile-supported innovation, and platform-based integration. It also requires strong executive leadership, governance, and talent strategies. While many Australian retailers are making selective progress on individual digital programs or initiatives, they are challenged to make progress on a systemic digital strategy — that is, digitally transforming the organization broadly rather than on an ad hoc, piecemeal basis. In addition, retailers dealing with legacy, disconnected, siloed systems have latencies and speeds that cannot support modern commerce. Most of the legacy systems do not allow retailers to quickly launch the types of services that customers today are expecting. Therefore, there is a clear need for retailers to give a serious consideration to making digital transformation a centerpiece of their corporate strategy. While doing seamless digital business is an omni-channel retail mandate, the reality is that many Australian retailers haven’t achieved consistent performance across all consumer touchpoints. IDC Retail Insights advises retailers to develop a culture of innovation and openness to support all the changes digital transformation will generate. Retailers should transition to digital in a modular way, focusing on a few technology areas at a time. Eventually, they should not only set clear and targeted key performance indicators (KPIs) and measurements of success for any digital-transformation-related initiative, but also come up with a back-up plan or exit strategy in case the transformation fails to provide the expected benefits.
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FAST-TRACKING TO SUCCESS S
ince its inception in 2007, TeleApps has become a rising star in the Australian communications space. Delivering corporate telephony, unified communications, collaboration, corporate networking, security, telco and WAN services, TeleApps operates in one of the most mission-critical technology spaces to Australian businesses — if the communications platforms go down, the entire business suffers. It was that need for reliable, enterprise-focused technology that led TeleApps to partner with Aruba shortly before its acquisition by HP Enterprises (HPE). Arrow, as a distributor for both HPE and Aruba, had also launched the Arrow APEX ECS ANZ channel initiative, which was immediately of interest to TeleApps, as a company looking to ramp its business with both vendors. “We started conducting business with Aruba and then HPE, two years ago. It has been a very successful part of the business,” TeleApps Founder and CEO, Sreeni Raghavan, said. “While we already had good traction with HP Aruba, we signed up for the Arrow APEX program as a way of getting greater visibility and taking us to the next level. We were already hitting good targets and on our way to being a gold partner with HP, but Arrow APEX has sped up the process at every level.” There are three key benefits that Raghavan and his teams have derived from the Arrow APEX program:
The fast-tracking the program has enabled.
The Arrow APEX program has helped TeleApps hit key milestones far quicker. According to Raghavan, the team was always on track to reach those goals, but the time saved through the program has been a major win. “We only need one more certification to reach the next partner level,” Raghavan said. “Across both technical and presales certifications we are being helped progress through that process far more quickly through the Arrow APEX program. Without the program, it would have taken at least another 18 months to get to where we will be in a few weeks.”
The considerable marketing resources
available to partners through the Arrow APEX program. “Certification is one thing. We’ve just started on leads and marketing initiatives sponsored by the Arrow APEX program. That’s something very timely for us because we’re working on marketing campaigns ourselves. It will be a major boost to that initiative.”
The energy it has brought to the
organisation. “The gamification of the program is also a big part of its appeal,” Raghavan said. “Internally, the team becomes quite excited and driven to earn the points — and it feels good to know that we’re competing on a leaderboard. It gives us, as
individuals and as a company, that extra motivation which goes a long way. And the prizes at the end of each year’s program are compelling rewards.” Raghavan said TeleApps will continue to be a part of the Arrow APEX program because of the multi-tiered value it offers. “Once we get the certification and become a gold partner to Aruba HPE, we could keep that for quite a while, but there is more to it than that, and we would definitely re-sign for APEX in following years,” Raghavan said. “The program also would be valuable for organisations that aren’t existing partners with HPE and Aruba. Signing up does give that initial incentive and push, which is enormously helpful when adopting new technology and business partners. “It’s not just another program! I hear that from both my technical and sales teams. The energy that Arrow puts into APEX takes it well beyond being just another program.” To find out more, visit ecs-anz.arrow.com
38 Interview IntegrationWorks
TAKING A SPECIALISED
PATH TO GROWTH ARRIVING IN AUSTRALIA, FORMULATING A GROWTH STRATEGY AND EXECUTING ACCORDINGLY IS NO EASY TASK — JAMES HENDERSON OUTLINES HOW INTEGRATIONWORKS ACTED ON SUCH PLANS.
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In a market crammed with more than 10,000 providers — spanning value-added resellers, managed service providers, system integrators and many more — differentiation can be difficult. Yet that is the order of the day for Australian businesses, businesses seeking tailored solutions to meet clearly defined objectives. “Specialisation and focus are key aspects of being a technology provider in the current market,” observed Ian Richards, managing director of IntegrationWorks Australia. “We have found clients that are leading in their industries are
June 2018 arnnet.com.au
forming long-term partnerships with specialist technology suppliers who provide thought leadership. “These relationships provide a partner ecosystem of expertise, that allow clients to draw on a greater pool of experience when delivering solutions.” Headquartered in the heart of the New Zealand capital, in Wellington, IntegrationWorks continues to build out capabilities across the Tasman, driven by growth in key markets such as Queensland, New South Wales and Victoria. Next up, Canberra and Western Australia, as the integrator expands
across the Australian market. “The opportunities that we see in the Australian integration market are focussed on connectivity internally and to the wider ecosystem,” Richards added. “Our experience shows that Australia and New Zealand remain very focused on providing short-term resourcing, or internal project development to meet these opportunities. “We leverage our extensive experience in other key markets and segments to provide actual solutions to industry problems, such as attracting and retaining customers
IntegrationWorks Interview
Ian Richards Managing director, IntegrationWorks Australia
Is digital a CIO priority?
39
But digital progress varies by industry. CIOs across most industries are struggling to move from experimentation to scaling their digital business initiatives. The survey revealed
The idea of shifting toward digital business
that a majority of CIO respondents are in the
across the organisation was speculative for
designing or delivering stages (54 per cent) and,
most C-level executives a few years ago.
of those respondents, CIOs in the transportation
But it has undeniably become a reality for
(61 per cent) sectors are taking lead positions in
across all industries, according to the Gartner
implementing the changes needed to become a
2018 CIO Agenda survey.
digital business.
“Forty-seven percent of CEOs said they
However, a minority (17 per cent) have
are being challenged by the board of directors
broken through the barrier and are either
to make progress in digital business, and this
scaling (14 per cent) or harvesting (three per
enterprise-wide focus on digital is also being
cent).
felt by CIOs across industries,” said Jan-Martin
“Looking at both stages combined, the
Lowendahl, research vice president at Gartner.
media (33 per cent) and telecom (29 per cent)
“As digital business takes hold, the impact
industries were in the top spots in terms of
on the job of the CIO and on the IT organisation
scaling the reach and impact of their digital
will be profound across all industries”
business initiatives, letting them mature, and
Of the 11 of the 15 industries participating, CIOs ranked digital business/digital transformation among the top three business priorities for 2018. “This shows an increasing digital urgency across industries,” Lowendahl added. CIOs from the banking and investment services (26 per cent), telecom (25 per cent) and government (18 per cent) sectors are placing
through meeting their needs.” Founded in 2005, the business specialises in professional and technical services, offering indepth expertise across integration architecture, application programming interfaces (API) strategy and program management, in addition to coding, DevOps and testing. In short, the more complex the integration development and deployment, the more suited IntegrationWorks is to the job. “Our global award-winning integration experience, combined with our delivery methods, frameworks and processes allow us
(67 per cent), retail (62 per cent) and telecom
many in 2018 as digital ranks as a top priority
allowing the business to harvest the benefits they were creating,” Lowendahl added. “The CIO will become an expert orchestrator of both internally and externally provided services. “In today’s increasingly “digital ecosystem” economy, success is based on the speed of integration. “The CIO will become an expert
digital business/digital transformation as their
orchestrator of both internally and externally
number one business objective in 2018.
provided services.”
to provide world-leading integration solutions for our clients,” Richards said. “We are independent of any specific technology or vendor, which allows our customers the freedom to select the most appropriate integration platform to use and share their information more effectively.” Despite alliances with Red Hat, MuleSoft, IBM and Dell Boomi — alongside Brisbane-based Internet of Things start-up Reekoh — Richards said taking a neutral stance allows the business to align technology to customer requirements. “We are engaged with several global standards bodies in our key market
segments to provide integration advice in working groups and new standards development,” he added. “This experience has provided the opportunity to directly influence our technology vendors in building new product features and roadmaps in their integration platforms, as well as providing a conduit to our clients for feature requests and enhancements.”
Customer strategy From an end-user standpoint, IntegrationWorks counts TrustPower, Christchurch City Council and New Zealand Police as customers, alongside Inland Revenue, FMG Insurance and
arnnet.com.au June 2018
40 Interview IntegrationWorks
New Zealand Racing Board. Specific to Australia however, a breakthrough came in June 2017, when the business bolstered presence by leveraging strong demand across private and public sectors. Triggered by a “major” Queensland healthcare government contract win, the integrator upped the ante across the Tasman, following up with Sydney and Melbourne office openings. “Our customers are world-leading organisations, and they always have the same drive as we do for continual improvement,” Richards added. “New technology driven business models have provided the requirement for our customer’s products and services to be more interoperable in their markets, and external markets. “We have seen an increased spend on interoperability frameworks and technology, and a demand for skilled integrators with proven experience. “A great example of this is Open Banking, where interoperability requirements now extend beyond banking and finance into market segments such as utilities, healthcare and manufacturing.” For Richards, integration technology that is “secure, robust and can scale” provides the platform for these new distributed business processes. “The technology vendor leaders are the ones that can consistently pivot
“VENDORS MUST BE PREPARED TO TAKE ON NEW BUSINESS MODELS”
June 2018 arnnet.com.au
A new ecosystem of providers
is a positive impact that the channel can and should deliver.” In examining the state of the current market, the key challenge for technology providers centres around the “finite and limited”
As the ecosystem of partners,
skilled expert resources available in
vendors and distributors evolves —
Australia, in addition the increasing
morphing from a structured supply
costs of servicing implementations
chain to a spider web of suppliers
and support, according to Richards.
— Richards cited cloud and as-a-
“Vendors must be prepared
service models as the key trends
to take on new business models
impacting the technology channel in
and solution propositions from
Australia today.
technology partners,” he added.
“These trends are providing
“Clients are now moving at
organisations with the ability to out-
a rapid pace and technology
pace leading organisations in their
providers are under pressure to
markets, and quite often they are more
deliver. Vendors that can support
educated in the use of this technology
the technology providers more
than the channel,” he added.
effectively will grow market share,
“Software and operations costs are being driven down by the changing
while those that cannot will decrease in significance.”
licensing and support models, which
with the market to support the new standards and protocols required for the client business models,” he added. “IntegrationWorks are the enablers of technology to implement business strategies.” In assessing the spending patterns of the Australian market, Richards said customers are primarily pursuing cloud services to reduce cost and risk associated with existing legacy platforms and vendors. Furthermore, the move to shift common workloads to serverless functions, and focus on core capabilities has created a “strong demand” for platform-as-a-service and hybrid cloud integration. According to Richards, this allows organisations to implement digital transformation faster and more efficiently with a smaller footprint. “Having a clear digital
transformation strategy and roadmap for execution are key to our business customers,” Richards added. “Working cloud effectively into the company strategy means more than just shifting infrastructure to remove cost. “Digital transformation is about using technology to provide a fundamental change to how a business operates and serves customers.” But Richards acknowledged that digital transformation skills remain “very low” and in many cases, being “learned on the job”. “Digital transformation is being used as a concept by services vendors to drive out costs in organisations through the use of technology,” he explained. “This is actually digital evolution, not transformation, and leads to a decrease in operational costs but not a transformative business model or game-changing product.”
42 Analysis Microsoft
Digital transformation could add $45B to Australia’s GDP
attract key digital talent, as well as be open in creating a flexible workforce model where they tap into a skills-based marketplace. A LinkedIn study in Australia revealed the top in-demand skills are big data, mobile development, and user interface and experience design.
APAC picture SAMIRA SARRAF OUTLINES HOW 100 DECISION-MAKERS EXPECT DIGITAL TRANSFORMATION TO IMPACT THE NATION. Digital transformation could add as much as $45 billion to Australia’s gross domestic product (GDP) by 2021, according to a new breakdown of joint research from Microsoft and IDC. The Australian GDP growth rate is set to increase by 0.5 per cent annually according to the study Unlocking the Economic Impact of Digital Transformation in Asia Pacific in 2017. It is unclear, however, just how reflective the findings may be of the bigger picture in Australia, given the study’s sample size — just 100 decision makers from mid and large-sized Australian organisations were consulted for this study. According to the Australian Bureau of Statistics there were more than 2.2 million businesses actively trading at the end of 2016-17. Regardless, the study showed that benefits from digital transformation can vary from improvement in profit margin and productivity, and cost reduction and increased revenue from new products and services. Challenges were also brought up including lack of skills and resources plus siloed organisations and cultures which are resistant to change.
June 2018 arnnet.com.au
Microsoft Australia managing director, Steven Worrall, said that organisations are deploying artificial intelligence (AI) as part of their digital transformation initiatives, which could accelerate growth further. “However, it’s important to note, transformation is about people as much as it is about technology,” Worrall said. “The top two barriers to digital transformation cited in the study are strongly anchored in an organisation’s ability to empower their people and transform their organisations to take advantage of the opportunity that digital transformation represents.”
Benefits The 100 Australian business decision makers surveyed believe the biggest benefit of digital transformation will be new higher value jobs. Worrall believes that this will affect jobs in a way it will evolve and change. “While it’s encouraging to see that 66 per cent of respondents are confident young professionals already have future-ready skills that will help them transition to new roles, organisations must focus on re-skilling and up-skilling those already in workforce who may not have the required skillset for the changing economy,” Worrall added. Among the important skills to focus on Microsoft listed complex problem solving, critical thinking and creativity. The report also suggested that businesses need to rebalance the workforce to attain and
Meanwhile, digital transformation could add as much as $1.48 trillion to Asia Pacific’s GDP, the study also revealed. Benefits of digital transformation include increased profit margins, productivity, customer advocacy, revenue from new products and services and more cost reductions. These benefits are expected to improve by approximately 50 per cent in three years. The study found that 26 per cent of new jobs are expected to be created from digital transformation, which is about the same number to be automated, or about 27 per cent; suggesting a neutral effect. Organisations that have full or progressing digital transformation strategies, with at least a third of their revenue from digital products and services have been classified as digital leaders in the study. This constitutes seven per cent of organisations in the region. The study also identified key differences between leaders and others in Asia Pacific, such as leaders being more concerned about competitors and emergence of disruptive technologies, with the rise of new type of competitors.
Why EDGE? EDGE brings 300+ senior ANZ channel decision-makers together in a collaborative and content rich environment. Over four days (29 July - 1 August) at beautiful Hamilton Island, EDGE 2018 will debate: • Who is the customer • How to help customers remain competitive • Where the market growth opportunities exist • How to help customers transition to emerging technologies • How partners can find new ways to influence new buyers • How partners can create customer value and transformation
CONNECT EDGE brings together the best and the brightest minds in the ANZ channel.
LEARN EDGE curates high level and compelling content to deliver meaningful insights.
COLLABORATE EDGE understands the need for channel expertise means more collaboration to deliver outcomes.
www.arnnet.com.au/edge
44 Synnex Alliance 2018
Tackling the triple value play: customer, partner and channel
CHRISTINE WONG
Frequently overused but seldom delivered upon, the notion of value in the channel continues to lack definition. In a market overflowing with new and emerging technologies, Australian customers are chasing innovation at breakneck pace. Irrespective of size or sector, end-user differentiation remains key as competition continues to increase. Within the supply chain, value spans the customer, the partner and the channel, each forming a crucial component of the overall solution. “The focus for 2018 is on reseller partners and how best Synnex can facilitate channel growth and engagement in a
June 2018 arnnet.com.au
changing market,” said Kee Ong, CEO of Synnex Australia and New Zealand (A/NZ). “This will come from driving growth within our value-add services business. “It will also be about staying relevant with new technologies — investing in the cloud marketplace, Internet of Things (IoT) enablement, expanding the vendor line up and offering endto-end solutions to address the entire IT ecosystem.” This Synnex Alliance 2018 roadshow, in association with Google and Microsoft, started with the end-user and worked back to define the notion of value, outlining the lucrative partner opportunities ahead in 2018 — James Henderson reports.
A
cross the Australian marketplace, customers of all shapes, sizes and sectors look, think and buy differently. With innovation levels heightening, forward-thinking customers are seeking forwardthinking partners in the year ahead, in a bid to create competitive advantage across the market. “Customer value centres around building out a complete solution, not just selling hardware, or just services, or just training,” explained Katherine Binks, channel manager of Chrome OS, Google Cloud. “Customer value is when a partner — or set of partners working together — can offer a complete bundled solution tailored to the customer’s needs.” Tapping into extensive local channel expertise, Binks recalled a time when an almost state of “paranoia” dominated the channel, with partners fixated on deal registration and ownership of the end-user. “That was five years ago,” Binks added. “It used to be that the reseller could solve three quarters of the solution and that was OK. “But now customers are looking for partners to come together to provide the full solution — and that includes working with the vendor and in many cases other partners. Working together to solve the customer problem is delivering true customer value.” With a responsibility for building out the Chrome OS partner ecosystem across A/NZ, Binks is tasked with leading channel enablement, recruitment and marketing incentives on both sides of the Tasman, while also driving growth through distribution. And today, customers are seeking “deep knowledge” within the context of technology, aligning with industry experts capable of collaborating — if the outcome requires — to deliver innovation.
Synnex Alliance 2018
Katherine Binks (Google)
45
Partner potential rife in education A successful Google partner in education understands the mechanics of a classroom and can think about a solution through the lens of a teacher, student and parent. To be a successful, partners must master the Google for Education value proposition for the three audiences. Google provides dedicated partner enablement to ensure our partners are set up for success. Also, Chromebooks are secure devices which are well positioned to support online assessments, alongside switch to testing mode to secure hardware and disable features such as internet browsing, screenshot functions, and USB ports. Teachers should spend less time monitoring students and more time helping them. Refresh opportunities also exist for the channel, in addition to up-selling of next-generation devices with additional use cases such as touch, stylus and world-facing camera capabilities.
• Suan Yeo — Head of Education A/NZ, Google
“At Google, we take a vertical approach and provide industry workshops to help enable and inform partners on what we are seeing in the market,” Binks added. “The partners we are looking for are open to alternative and new technologies, and keen to go all-in with Google as we have many different solutions for various verticals. “The way we enable and train is very different — it’s about 30 per cent engagement, 70 per cent building competencies.”
Enterprise One partner aligning to Google in the Australian enterprise space is Fujitsu, a provider committed to building long-term customer relationships across the market. Driven by a vision of ‘Human Centric Innovation’, the business is focused on how the solutions and
services provided impact the quality of life and work for customers. “Ultimately, value is defined by how well the business outcomes have been achieved and how this was perceived by the customer,” Fujitsu
“Customer value centres around building out a complete solution” Australia solution director, James Mercer, said. “We’re finding that co-creation is an important aspect to partnering and delivering business relevant outcomes for our customers. “Often the best solution comes from a collaborative effort between
vendors, customers and partners.” To maximise the co-creation process, Mercer — alongside Google — engages customers through initiatives such as design thinking workshops and hackathons, in a bid to extract a customer viewpoint in the context of value. “The deeper knowledge we have of the customer the better equipped we are to help them achieve their business outcomes,” Mercer added. “Customers are increasingly looking to vendors and partners for innovation as they see this as a key differentiator for their business. “We are in a good position to help our customers by leveraging our global expertise and innovation through technologies such as cloud, artificial intelligence, the Internet of Things and blockchain.” In assessing the ever-evolving enterprise market, the DNA of the
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46 Synnex Alliance 2018
customer is changing at pace, with the CIO no longer the standard-bearer of IT — there’s a new buyer in town. “To understand a customer’s problem, it’s no longer enough to just speak to the IT department,” advised Bryan Lee, head of global channels, Google Cloud. “This is more of a business discussion, rather than simply a presentation. “Given that customers require deep knowledge, partners must move away from the ‘do it ourselves mentality’ to adopt a collaborative partner approach.”
Education Maintaining an all-in approach, this time in the field of education, EdTechTeam operate as Google for Education specialists in Australia, leveraging a partnership spanning more than 10 years. Going to market through a global network of educational technologists, while leveraging professional development expertise, EdTechTeam worked with educators in 39 different countries during 2017, across 11 different languages.
June 2018 arnnet.com.au
“The relationship that we have with Google as a partner is one of mutual respect and support,” EdTechTeam regional director A/ NZ, Kimberley Hall, added. “We heavily utilise the Google ecosystem in the way we do business, so we believe in and have experience with, the strength of their solutions for both education and business.”
“It’s no longer enough to just speak to the IT department” As the first female in Australia to be both a Google Certified Teacher and Google Education Trainer, Hall is well versed in the notion of customer value. “Customers experience value when they are provided with solutions, not just physical devices,” Hall explained. “Most education
Bryan Lee (Google); Katherine Binks (Google); James Mercer (Fujitsu) and James Henderson (ARN)
customers are seeking to purchase devices to assist in solving a problem at their school and it’s rarely that they simply like having more hardware to manage.” Consequently, Hall said “it’s no longer enough” for providers to simply unbox devices for schools. Instead, plans must be in place to connect customers with professional development and online resources, designed to enable endusers to maximise infrastructure investments. Specific to EdTechTeam, the provider has expanded capabilities to partner with schools and departments to customise ongoing support for end-users with the aim of utilising devices for the transformation of teaching and learning. “We have also diversified our offerings,” Hall explained. “We offer customers support in the form of large scale conferences, fully customised professional development, online courses and even a book publishing arm for current research-based support materials.”
Synnex Alliance 2018
47
Creating IP for the customer I
n the context of the customer, the notion of value varies. But one overarching concept remains for the channel, in a world in which business outcomes takes centre stage. “For Microsoft, the channel is the critical enabler of customer value, our customers are also our partner’s customers,” said Steven Miller, director of education, Microsoft. “We know what businesses are looking for, which is technology that can help provide a competitive edge and unlock value.” To achieve this, Miller said the channel must adapt and build on their own unique IP, spanning solution and service offerings. “That way, partners are delivering relevant technologies that deliver outcomes for their customers,” he explained. “That is customer value and in a competitive marketplace, ensures the channel continues to thrive.” Operating in an ecosystem spanning thousands of providers in Australia — incorporating all aspects of the supply chain — Datacom is a partner delivering on the promise of value, through a shift away from traditional technology processes. “It’s about the intangibles,” added Peter Stein, general manager of software and cloud alliances Australia at Datacom. “Customer value is about more than margin and volume across the resale. “We’re looking at ways of adding value to a customer’s business, which they use to create a better experience for their customers.”
Striking an alliance to reinvent the classroom
Steven Miller (Microsoft)
Today, Stein said customers expect the creation solutions that work “first and foremost” for the business, and because of this, refuse to be “shoehorned” into a single vendor, one-size-fits-all, boxed solution. “We work closely with all our partners to ensure we can provide those multi-faceted solutions with them,” Stein added. Furthermore, the emergence and acceptance of cloud continues to disrupt legacy technology, placing a requirement on consultants and experts to be “flexible, reliable and quick to market”. “For Microsoft, continually striving to provide our partners with platforms that can help them thrive
The HP and Microsoft relationship really shines at it brightest in the education segment. From the foundations of ensuring we are building the right machines for schools, in collaboration to how we then deliver them to market through our channel partners. This also includes our continued success and support of education programs such as HP Education Excellence Program and Microsoft Shape the Future. Over the last few years, we have shared a laser focus on our corporate and social responsibility to offer thought leadership to schools and the education channel. This has been achieved through delivering joint training and events to students and teachers with our Reinvent the Classroom and HP Kids Day campaigns. Our partnership has never been more important as we together help empower the teachers to develop our workforce of the future. • Katrina Yon — Commercial sales program manager of channel, HP
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48 Synnex Alliance 2018
and build great customer relationships is essential,” added Miller, when referencing how the vendor’s approach to partnering has changed. “In so many ways, the core skills of listening and understanding to what your customer is seeking to do in their business, plus extending that out with knowledge of their competitors really gives you the opportunity to work at a far deeper level. “Augmenting that with your own IP, something that makes you unique will set you apart and help you really deliver for every customer.”
Delivering value in education For a Microsoft partner, there are many ways technology is being leveraged to unlock value for the customer. The ability for partners to develop on the Microsoft platform and deploy repeatable IP to multiple customers, provides an enhanced level of flexibility. A good example in education is the ability for a device partner to build, sell and deploy a digital assistant, hosted in Microsoft Azure, leveraging repeatable IP and facilitated by CSP licensing with great ease — improving the end-user experience as a result. Our One Commercial Partner organisation is really underpinning the creation of new value to partners, which is transferred onward through to customers. This helps better align the right partner, with the right customer, offering the
Differentiation Delving deeper, and specific to the education sector, Melbournebased Edunet is using the concept of value to differentiate in a highly competitive market, recognising the need to look beyond the device to deliver end-user outcomes. “Value is what sets us apart from retail,” Edunet managing director, Matthew Gordon, added. “PCs are a commodity item meaning our valueadd must be a differentiator in the marketplace. “It’s a simple recipe, trustworthy advice pre-purchase plus a solid warranty and service program to support the device post-purchase.
June 2018 arnnet.com.au
right solution / or service at the right time. For a higher education customer, this could mean a shift toward digital assistants — to improve the customers’ customer experience e.g. the student. In the K-12 segment of the education industry there is a sustained focus on how partners can help to enable 21st century skills development. Regardless of the nuances of each sector the opportunity to be part of a customer’s digital transformation is there. Specific to success in the channel, we’re seeing partners become trusted advisors to customers. This means being more than a cog in the system and moving away from transactional relationships. • Jesse Cardy — Enterprise channel manager of education, Microsoft
Peter Stein (Datacom)
Putting a robust enterprise-class machine in a student’s hands and being able to offer white-glove services such as imaging and also repackaging items to save on waste are also key elements.” Traditionally, Gordon said PCs have been ordered in quantity, before the market shifted towards both bring and choose-your-owndevice, resulting in purchase orders changing from a single order to hundreds, with conversations becoming more frequent, this time with individual families and students. “We’ve adapted to make sure our value offering suits both schools and families as these two demographics can often have different views of value,” he added. “Customers today are talking about security.
We’re at the coalface of connecting students to the online world through technology.” Despite the majority of schools having the appropriate measures in place, Gordon said a focus on protection remains, especially when then machine is used outside of the core network. “Traditionally questions such as ‘how can we protect the device while being used in the home?’ have been met with answers such as ‘ensure it’s used in a public area’,” Gordon explained. “Families are now asking for more and parents are looking to lead the conversation in the home around cyber security. “It’s our job to stay ahead of emerging technologies and apply them to examples such as this.”
HOW TO ENTER September 20 | Hyatt Regency Sydney
For more than 27 years, ARN has been tracking, reporting on and championing the ecosystem of partners, vendors and distributors within the industry, which will again be evident at the celebration dinner in 2018, taking place on Thursday 20 September in Sydney.
Partner Value When entering nominations in the partner categories, keep customer value at the centre of submission. Showcase that one piece of transformation, that one strip of innovation that reinvented the business of your customer. Outline how you leveraged technology and unique IP to make a difference.
New-look categories • • • • • • • • •
Start-up Emerging Technologies Homegrown Innovators Partner Value Vendor Value Distributor Value Personal Innovation Channel Choice Hall of Fame
Vendor Value When entering nominations in the vendor categories, submit through the eyes of the partner. Outline the value you provide to partners and crucially, how you are helping partners deliver innovation to customers. These awards will not recognise the industry’s largest vendors, they will not be judged on size, revenue or market share. Partners value much more. They will acknowledge true channel strategies and exceptional partner philosophies, irrespective of tier-1, tier-2 or tier-3 rankings.
Top tips to make your nomination stand out
1
A well-written nomination should firstly answer each question in full, offering a clear, direct and specific statement of why a particular company or individual should win an award
2
Each category has three to four questions as part of the award criteria — please make sure you specifically answer the criteria, but also limit your responses to the 200-maximum word count set per question
3
Strong nominations list the most important information in the first few sentences and then elaborate as necessary, including enough information for the panel to become familiar with the work and achievements of the nominee
4
Also, judges advise against nominees resting on their laurels in terms of brand reputation and work within the channel, stating that if it isn’t written on the submission, then it cannot be judged as outside influences do not count
5
Finally, please note that multiple copies of the same submission are not allowed. You can, however, nominate across multiple awards and categories
Distributor Value When entering nominations in the distributor categories, look across the entire supply chain. In operating at the beating heart of the channel, distributors must juggle the needs of a vendor, with the requirements of a partner and the demands of a customer. Value-added is a clichéd and overused word and while it’s imperative for distributors to get the basics of logistics and finance right — warehouses are warehouses and boxes are boxes. How are you evolving as new technologies flood the market? How are you sourcing and recruiting new breeds of partners? Distributors will be judged on reinvention, rather than tradition.
Submit your nominations by Friday, July 6 www.arnnet.com.au/innovation_awards/nominations/
50 Start-up Spotlight
Start-up Spotlight
The Pendula team
Chris Carter-Jones | Director, Yell IT
Pendula
Yell IT
FOUNDED 2016
FOUNDED 2015
HEADCOUNT 14
HEADCOUNT 35
KEY TECH A platform for automated omni-
KEY TECH Cyber security
channel communications across SMS, email,
KEY PARTNERS Cisco, Palo Alto Networks,
instant messaging, fax and post
CyberArk, Bit Glass, Carbon Black, Riverbed,
KEY VENDORS Salesforce, Zuora, Amazon Web
NetApp
Services, Enrite Care, Outfit and Natterbox
KEY CUSTOMERS Mid-market to enterprise
KEY CUSTOMERS Australian Computer Society,
organisations
Cancer Council, Choice Passion Life, Ovo Mobile, Scope Australia, Catch Group
EMERGING START-UPS CHANGING THE FACE OF THE CHANNEL IN AUSTRALIA — LEON SPENCER REPORTS
In April, the NSW Government-backed Jobs for NSW handed Sydney-based independent software vendor Pendula a $100,000 Building Partnerships grant to help it develop and market its internally-developed email and messaging platform. The funding injection saw the local start-up, which was at the time named Zipline Cloud, make moves to launch its platform in London, in partnership with Salesforce and Accenture. Today, Pendula boasts a solution that extends the functionality of platforms businesses already use, providing greater visibility and control of customer journeys. “The idea is that by putting all your channels of communication in one place, with automatic triggers that can understand inbound message contents and context and use that information to send personalised replies, we can create real value for companies who today struggle to communicate with their customers consistently at scale,” Pendula CEO Alex Colvin said. The company’s launch platform was Salesforce, but it has also recently launched on Zuora, a move that Pendula team hopes will make a “huge splash” in the market. Now, Pendula is looking beyond the Australian market, with plans to establish offices in the UK and the United States by the end of the year. “As ever, we also have some exciting product updates in the pipeline around emotional intelligence as well as expansion to new channels of communication,” Colvin said.
June 2018 arnnet.com.au
In February, Brisbane-headquartered networking, security and cloud IT solutions provider Yell IT revealed it had earned the Palo Alto Networks NextWave Traps specialisation, representing the latest feather in the provider’s proverbial cap. Since its founding in mid-2015, Yell IT has made a name for itself consulting, designing, building and operating cyber security, networking and cloud solutions for its customers in the Queensland market and further afield. The company is also a partner of Telstra, which offers leverage in a rich portfolio of advanced solution offerings. The solutions Yell IT can tap into thanks to its Telstra partnership include offerings such as software defined wire area network (SD-WAN) technology. It also provides access to infrastructure-as-a-service (IaaS) offerings from most of the major vendors. Three years after its founding, the IT provider’s strategy appears to paying off, with the company clocking around 300 per cent year-on-year growth while winning a number of large enterprise projects over the past year in Australia and Papua New Guinea. “The business is doing extremely well and has grown significantly since inception,” Yell IT director, Chris CarterJones, said. “We have been careful to evolve at the right pace allowing business process to be matured along the way and to undertake projects where we know we can successfully execute and deliver a business outcome.”
Start-up Spotlight
Paul Bird | Managing director / CEO, SecureCo
51
The FluroSat team
SecureCo
FluroSat
FOUNDED 2011 [pivoted 2015]
FOUNDED 2016
HEADCOUNT 35
HEADCOUNT 12
KEY TECH A platform for enterprises to secure
KEY TECH Predictive crop health analytics
their payment data and achieve payment card
KEY PARTNERS Google Cloud
industry (PCI) compliance
KEY CUSTOMERS Agronomy service providers,
KEY PARTNERS Oracle and Cisco
such as crop consultants and agriculture
KEY CUSTOMERS Amaysim, along with
technology providers, while farmers are the end
other enterprises in the retail, insurance,
users
telecommunications, energy, online and travel sectors
SecureCo might be seven years old this year, but the company’s latest iteration hit about three years ago, when its founders decided to pay extra attention to the payment card industry (PCI) compliance needs of its enterprise customers. The company began life as a payments gateway for organisations handling online transactions before focusing on solving PCI compliance problems for enterprises. “The key was in talking to a lot of large companies about their payment gateways; the insight was that the payment gateways weren’t solving the problems of PCI for enterprises, and there was an opportunity to solve that problem,” SecureCo managing director and CEO, Paul Bird, added. “We pitched the platform that we’ve subsequently built to our early customers and most of them, within 10 minutes of presenting the idea, said that ‘we would take that if you had it’.” Today, SecureCo’s platform delivers a simple solution for enterprises to secure their payment data, achieve PCI compliance and improve their customer experience. After the platform was built, according to Bird, the company started winning “really big” client and, in fact, began taking business from some of the big, known vendors that play in the space but aren’t as specialised as SecureCo. Now, the public and private sector’s focus on privacy, compliance and data security ramps, the company is finding itself in a good position to grow.
In May, local tech start-up Flurosat was among nearly 20 exhibitors in the Entrepreneur HQ section at the CeBIT Australia 2018 trade fair in Sydney. The appearance was good exposure for the young company, but it wasn’t the first time it has been in the limelight. Founder and CEO Anastasia Volkova has been a prominent spokesperson for her company, explaining what her company does and the motivations behind it. Broadly, FluroSat uses state-of-the-art remote sensing technologies and data collected from drones and satellite platforms to offers solutions to agricultural problems. The company’s analytics platform uses proprietary algorithms to assess the health and potential of crops, identify and classify problems, and propose a solution. Today, the company is working to build out what Volkova calls its “two-hemisphere plan”. This follows dual planting and harvesting cycles in both the Northern Hemisphere and the Southern Hemisphere, meaning the company can continue to work, regardless of the season in the respective regions. “We’re expanding across Australia, and now we have our customers even in California,” Volkova said. “We’ve presented now on quite a few high-profile industry events, such as world Agritech Summit and things like that, which attracted quite a bit of good attention from potential partners; we’re after partners right now.”
arnnet.com.au June 2018
52 Channel Chat
Channel Chat with
HPE
JULIA TALEVSKI CHATTED TO MARINA FRONEK, GENERAL MANAGER OF CHANNELS AND ALLIANCES, HEWLETT PACKARD ENTERPRISE. Marina Fronek | GM of channels and alliances, HPE
From a channel perspective, what are HPE’s top priorities? I was fortunate to inherit a thriving business when I took over the channel in November. Globally, over 70 per cent of revenue is through partners and that continues to increase. We’ve managed to increase that year-on-year with significant double digit growth in the first six months, during the time I’ve had the benefit of looking after this part of the business. My top priority has been connecting with partners, understanding their different business models and what makes them successful. From a programmatic perspective, we’re not making any changes at the moment. The experience thus far, has been about getting experience from partners, to understand what’s been working and what needs to be improved. What feedback are you receiving from partners? In relation to our product portfolio, more partners are wanting to further collaborate, particularly through the organic growth we’ve experienced around our acquisitions such as Simplivity and Nimble Storage. We’re very much into co-selling with partners and up-skilling. The second area centres around
June 2018 arnnet.com.au
continuing our investment in our Partner Ready program. The work that we do around Partner Ready, whether it’s training for marketing, sales or pre-sales people, partners want to make sure those investments continue, and we’ll continue to enhance that. We’re also making sure that we’re accessible to partners as a HPE community, which is important to them. In the past, there’s been a bit of a perception that HPE was competing with our partners in services, but those days are long gone and we’re selling with partners. What does your partner roadmap look like during the next 12 months? One of our goals in the next 12 months is to ensure we maximise the organic innovations that we’ve done through our acquisitions. One example is around HPE Synergy, which is composable infrastructure. We’re getting a lot of demand from our channel partners across the market and region, for that capability. Both the Synergy and Nimble Storage acquisitions have been a real asset in enhancing our portfolio. Those are the conversations that we have around normal infrastructure refresh requirements, which very quickly turn into a value sale for the partner.
It’s about maximising those investments and ramping up HPE Pointnext collaboration because there’s a lot of opportunities for partners to monetise those services, which will be another strong focus. How are you helping partners maximise this area of the market? We’re trying to get our joint teams to work together. The more focused you are, the better outcomes you achieve. It’s about targeting markets, clients sets, and being very focused on the strategy that we’re both working towards. Also, it’s about having a very clear focus on what your target markets are and mutual expectations. What are the key opportunities ahead for the channel? From a trend perspective, one thing that has been resonating is the shift from a CAPEX to an OPEX model. We have a solution called Flexible Capacity, which is a consumption model — where clients pay for what they use, and that’s sold via our partner community. It’s a significant opportunity and the demand for that is significantly increasing. It’s a win-win for the partner, HPE and the client. How are you helping partners transition business models? The notion of partnership has changed a lot over the years. We’ve got a very blended type of partner community, where no one fits into a particular category anymore. Most organisations we’re working with aren’t just reselling, they’re heavily geared towards a services environment. We have different support for service providers through offerings that suit that dynamic. It’s about optimising what those organisations already have.
54 Emerging Leaders 2018
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Upcoming tech talent share insights at Emerging Leaders 2018 The channel came together for the third running of the ARN Emerging Leaders Forum in Australia, created to provide a program that identifies, educates and showcases the upcoming talent of the ICT industry. Hosted as a half day event, attendees heard from industry champions as keynoters and panelists talked about future opportunities and leadership paths and joined mentoring sessions with members of the ARN Hall of Fame. The forum concluded with four awards across vendor, distributor, partner and start-up organisations.
2 1. Ian Richards (IntegrationWorks); Damian Zammit (Thomas Duryea Logicalis) and Najah Ayoub (Tecala Group), 2. Damian Zammit (Thomas Duryea Logicalis), 3. ARN Emerging Leaders Forum, 4. Najah Ayoub (Tecala Group), 5. Victoria Kluth (Araza), 6. Chris Hewlett (HP), 7. Tara Ridley (Cisco), 8. ARN Emerging Leaders Forum, 9. Ian Richards (IntegrationWorks), 10. ARN Emerging Leaders Forum, 11. Daniel Danielli (Arrow)
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CHRISTINE WONG
Emerging Leaders 2018
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Emerging Leaders 2018 (continued)
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Emerging Leaders 2018
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CHRISTINE WONG arnnet.com.au June 2018
58 Analysis CIO
Former CEO of the Digital Transformation Office Paul Shetler has slammed the government’s IT outsourcing bent, saying it has drained the public service of tech talent. The government should instead build internal capabilities and emulate the likes of Facebook and Amazon, Shetler told the Senate Committee on Digital Delivery of Government Services in March. “Years of outsourcing to contractors and integrators have progressively deskilled the public service to the point that it lacks the digital and commercial skills needed to deliver services that citizens expect,” Shetler wrote in his submission to the committee. “Government urgently needs to conduct capacity and capability planning for the future public service,” he said in the submission, co-authored by former senior digital advisor Jordan Hatch and former digital marketplace head Catherine Thompson. According to the Community and Public Sector Union, which also appeared at the committee, the public service employs more than 14,000 IT personnel, of which close to a
third are contractors. That share has grown from around a fifth five years ago. “Reliance on vendors in turn further deskills the public service, to the point that it is not uncommon for public servants to seek advice from vendors about what they should be buying,” Shetler added. Shelter was hand-picked by then communications minister Malcolm Turnbull to lead the government’s Digital Transformation Office in July 2015. Following a restructure and rebrand (to Digital Transformation Agency) in October 2016, Shetler was effectively demoted from chief executive officer to chief digital officer. He resigned less than six weeks later. Appearing before the committee today Shetler warned against continuing to outsource IT contracts, and recommended capability was built in house. “Government should try to develop its own capabilities because, Facebook, Amazon, every one of these companies they don’t outsource their stuff to IBM or Accenture or anyone like that,” Shetler told the committee. “They make darn sure they can react in
Has government’s IT outsourcing bent deskilled public service? PAUL SHETLER ARGUES PUBLIC SERVICE NEEDS TO EMULATE AMAZON, AND ESTABLISH TRAINING ACADEMY — GEORGE NOTT REPORTS.
June 2018 arnnet.com.au
real-time to their understanding of what user needs are. “That’s how they survive. That’s how they maintain competitive advantage. It’s that speed and their ability to adapt. It means they have to control what they do. “Government should be, and really must be, like anybody else that’s working in the digital world, open to practices and see what’s working and doesn’t work and be on the forefront wherever it can.”
Digital academy A census of APS staff taken in 2015 found that 35 per cent had received no formal digital skills training at work. Shetler urged the government to create “modern digital and technology professions” with competitive salaries and career prospects, to create a “genuinely compelling offer to work in digital or technology roles in the public service”. He also recommended a formal training and accreditation program — a ‘Digital Academy’ — once proposed by the DTO. “It takes people from within the ranks, it takes people who understand why they’re in government in the first place, who actually have a mission for what they’re doing, who understand the existing operational problems and who also understand user issues — and trains them up as professionals,” he said. A similar initiative by the UK government has improved the skills of 6,500 civil servants since it was launched in 2014. According to the UK government, one of its Government Digital Service Academy courses was attended late last year by a representative of the Australian Public Service Commission. The Canadian government is also seeking to emulate the idea. “It’s absolutely the best way to do it,” said Shetler. This article originally appeared on CIO Australia.
June 2018 arnnet.com.au Nick Verykios Managing director, Arrow ECS ANZ
FOLLOWING A LONG AND SUCCESSFUL CAREER IN THE AUSTRALIAN CHANNEL, NICK VERYKIOS SITS DOWN WITH JULIA TALEVSKI TO OUTLINE HIS NEXT STEPS.
60 Interview Arrow ECS ANZ
TO NAVIGATE A NEW WORLD ORDER GOING AGAINST THE GRAIN
Arrow ECS ANZ Interview
N
ick Verykios isn’t known for following generic processes, and seldom could you consider the entrepreneur predictable. This is a man that aims to stand out from the crowd, think differently and go against the grain, making a name for himself as a creator, and then seller, of value-added distribution businesses. Verykios has a healthy knack for spotting a gap in the market, and filling the void with a blend of deep expertise, vast industry knowledge and a local touch. Such a strategy started in the early 1990s, the year of 1994 to be precise, when he founded his first venture under the banner of 1World Systems, before selling the business four years later. With the ink barely dry on the buyout papers, Verykios was brought into the fold at LAN Systems through long-time business partner, Scott Frew. The duo combined capabilities to build the business to a point in which international suitors were knocking on the door, resulting in Datatec — parent company of then Westcon Group — stumping up around $30 million to take the reins. It wasn’t until 2007 however, that the local distributor was officially rebranded as Westcon in the Australian market. All up, Verykios spent six years at the helm of LAN Systems, exiting the business in 2004 before Frew again tapped his shoulder, this time to help capture market share in the lucrative specialist security space, through the launch of Firewall Systems. The business was eventually transformed into Distribution Central, carrying many other specialist divisions including storage, networking and unified communications. Fast forward to 2016 and the business was accelerating at pace,
cracking new milestones on the path to achieving $400 million revenue, before winning distribution rights for Hewlett Packard Enterprise in the local market. Then came Arrow Electronics, calling from Centennial in Colorado to acquire the business and significantly boost Australian market presence in the process. Upon completing the integration of Australia and New Zealand (A/NZ) operations in October 2016, a new distributor was formed in the name of Arrow ECS ANZ, with Verykios once again spearheading operations.
New dawn Now to 2018, and a crossroads for the industry veteran. “We were really happy with the decisions that we made at each individual time, based on what was available and what would suit us,” recalled Verykios. “I put a lot of attention and effort into trying determine and work out what Arrow would do with our intellectual property, ideas, strategies, processes and the people behind it. “We wanted to know whether it would be preserved and we put a lot of effort into that. We know we got that right, 100 per cent.” At this stage, Verykios is committed to the Arrow cause, a cause which offers him the freedom to pursue growth through his own style and strategy, leveraging the expertise of a global distribution giant in the process. “Technology is now manifesting itself into more useful forms of zeros and ones, in artificial intelligence, in autonomous technology and cognitive learning,” he added. “That fascinates and excites me, and it’s the reason why I’m doing it in the capacity at Arrow because they’re at the forefront of this.” Globally speaking, Arrow is represented across 80 countries, with over 18,800 employees serving more
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than 150,000 customers. With sales revenue totalling US$26.6 billion during 2017, backed by a healthy share price, the titan of industry provides products, services and solutions to industrial and commercial users of electronic components and enterprise solutions. Two years on since acquiring Distribution Central, the local arm of the business continues to carve out a sweet spot within the emerging technologies market, spanning the Internet of Things (IoT), cloud, security and analytics. Coupled with business intelligence, data centre and mobility offerings, Arrow aligns with leading vendors such as Hewlett Packard Enterprise, Microsoft, FireEye, F5 Networks, Check Point and Sophos, alongside Symantec, NetApp and Extreme Networks among others. Looking ahead, Verykios is doubling down on IoT specifically, focusing on the lucrative — and currently untapped — market that includes sensors, dashboard analytics and edge devices to gateways, alongside public and private cloud capabilities. “IoT is everything at the moment and it’s about how we can bring together what’s happening with the cloud, public and private,” he said. “The channel is no longer — vendor, distributor and reseller to the ultimate customer. It’s an ecosystem that gathers around and organises itself on an outcome that needs to be delivered to help solve a problem. “The channel itself is an organic part of the ecosystem rather than a vertical. It has its place in being able to inform how products and services get into the customer.” And distribution will continue to play a vital role in the ecosystem. “Without distribution, you can’t fulfil the execution of these solutions that solve the ultimate problem for a consumer whether it be government, enterprise or personal,”
arnnet.com.au June 2018
62 Interview Arrow ECS ANZ
he added. “The only confusion that exists for distribution right now, is understanding where it fits inside that organic horizontal ecosystem as opposed to vertical. “What distribution has always done, is inform that vertical how a product is going to get to the ultimate consumer, and when it does it well, it produces quality outcomes for the consumer.”
Outcomes In speaking from experience, Verykios alluded to the concept of value-add in distribution, insisting that producing “quality outcomes” is where such a component provides significance. To back up such claims, Verykios cited examples of how Arrow is providing value at a local level, through a range of proof-of-concept projects nationwide. Specifically, this includes areas such as agriculture, through tracking and organising livestock by tracking temperatures and feeding times. Meanwhile, in the healthcare sector, through using telemetry data and sensors to help decipher what happened during a car accident, for example. Another sector the distributor is focusing on centres around retail, helping to reduce produce waste through monitoring refrigerator temperatures and stock. “We’re working on proof of concepts in Australia, which are very similar to what Arrow is doing on a global scale, and it’s exciting for me because we’re participating in the development of the future and we’re an active part of it,” Verykios explained. Another pivotal focus for Verykios is harnessing the talent of upcoming entrepreneurs within the business, ensuring the team participates in opportunities emerging through Arrow’s Sensor to Sunset strategy, zoning in on technologies such as sensory, edge computing, cloud,
June 2018 arnnet.com.au
analytics, security, services and sustainable management. “I want to start incubation units with entrepreneurs of the future that are involved in all this innovation and help develop the younger generation of graduates by helping them stay relevant rather than redundant by the end of their degrees,” Verykios said. “What technology is doing, is allowing everyone to be an entrepreneur. “The ecosystem exists to support your idea. You don’t need to sell your soul to someone to get the channel, get the funding and then finally be able to deliver your idea to the ultimate consumer, that’s ancient. “Your idea can now be supported
“I’M JUST A MARKETING GUY AND I BUILD OUTCOMES”
by a horizontal ecosystem of finance, distribution, management, marketing, and enablement that organises itself, to take your technology one step closer to the consumer.” Furthermore, Verykios said the ability to think “critically” will become a huge asset for corporations, potentially shifting the mindset of measuring return on investment from “working capital” to “human capital”. “Return on investment is mathematical and easy to financially prove,” he added. “We don’t place much value on intellectual property and the ability to think critically will become a huge asset, as opposed to remembering a lot of things.” Throughout his varied business career, Verykios has learned that over time, pursuing “generic processes” has almost always resulted in the wrong choice. “There’s no quality in the participation of a generic process because you just become a clone, of everything else,” he observed. “There’s no soul in that so therefore, there’s no value in it, and if there’s no value in it, then no one’s going to buy it or if they are, then it will deliver zero profit. In looking back on a lengthy career in the channel, Verykios believes he has essentially come “full circle”, having first started out in marketing, to know focusing on building outcomes. “I’m just a marketing guy and I build outcomes based on technology,” he added. “That’s what I’ve always done and working with Arrow has brought me back full circle. “The ability to make knowledge useful is where the power is — turn into something useful and valuable, something that someone can’t do without. “The technologies that are coming to life — cognitive computing and artificial intelligence are really exciting, and creating impulse, keeping us thinking and developing even further than before.”
Annoucing the ARN Innovation Awards
ARN is proud to announce the 2018 ARN Innovation Awards. These awards celebrate and reward excellence in Australiaâ&#x20AC;&#x2122;s tech industry. You are invited to be involved in these annual awards which will be attended by 700+ industry professionals and is a superb opportunity to host and network with business partners or to reward your own teams for their support.
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FOR SPONSORSHIPS CONTACT: Cherry Yumul: cherry_yumul@idg.com.au Eduardo Silva: eduardo_silva@idg.com.au Jackson Raddysh: jackson_raddysh@idg.com.au Susan Searle: susan_searle@idg.com.au
64 Channel Confidential
Should I stay or should I go?
GOING OFF THE RECORD TO REVEAL THE UNSPOKEN REALITIES OF PARTNERS, VENDORS AND DISTRIBUTORS.
And should I hire you based on what I know? How long is too long to stay put in a company or a role? For some people, it has become a part of their mantra — to unleash their expertise within a company and then leave. And it works well in their favour — they can match their skills and reputation, and make an impression wherever they go. Their projects may certainly be outstanding pieces of work, but some prospective employers might not look at it so favourably, following their job hopping on LinkedIn — 12 months at ABC; 18 months at XYZ and then a notable gap of months in between to do ‘consulting’ work under some brand that doesn’t exist online. Well, you get the drift…staying or going — whether by choice or not, is a far shift away from the mindset of previous generations, who would invest most of their working life, and for many that would escalate to beyond 20-odd years, in the same company. Some may look at this in admiration of staying power and commitment to the company/job while others will put on their critical thinking caps, looking at it as limiting their knowledge, management style and
June 2018 arnnet.com.au
experience beyond the parameters of that certain position or company. Specialist recruitment firm, Randstad, put their rubber stamp on this when declaring that for IT workers, staying in one job for too long was one of the greatest career risks — particularly pointing out that the longer you stay in a position where your skills don’t evolve, the harder it will become to leave on your terms. It also throws up the ‘repetition’ factor, if you do something well for long enough, are you really learning from doing the same thing repeatedly, year-in, year-out 10 years on? There are many types of employee personalities and experiences that shape the talent pool in the market. As a small business owner, when some outstanding talent puts forward their interest in my company, would I bother investing my time in someone who might not stick around long enough to really make a difference to my business? Maybe, maybe not. It would strictly depend upon what I’m hiring for, some contractors have been a total hit and some, a miserable mess. Even employee background checks can be a tricky minefield unless you have ties with their previous employer.
I have been warned before not to hire a certain person, because of their history with mishandling and expensing way too much with the company credit card, and even worse than that, was catching out an applicant who blatantly lied about working with a company, who we partner with, when in fact, no one knew who they were. Back to the topic, it would be ideal to hire talent for a bit of a long haul as a small business usually doesn’t have that many resources to keep up with talent churn. In many cases my list of clients might not be very extensive, but their projects are constant and I have my own company’s repertoire to protect on that front — so carefully selecting talent is a very high priority. I have learnt from my mistakes in the past, hiring just for the sake of hiring or just because their LinkedIn profile or resume ‘appeared’ outstanding, only to discover first-hand their ‘lead’ in certain projects was nothing more than their firm belief they could’ve done a better job, if given their opportunity to ‘lead’ the project. Now, I’m all for harnessing and bringing up young talent, but in some cases, that doesn’t always apply and I’m back at scouring LinkedIn for my next potential candidate.
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*Lenovo ThinkSmart Hub 500 requires an applicable Skype for Business license - please see ThinkSmart hub deployment guide on lenovo.com.au/lpa for further details. Lenovo (Australia & New Zealand) Pty Limited ABN 70 112 394 411 (â&#x20AC;&#x2DC;Lenovoâ&#x20AC;&#x2122;) reserves the right to alter product offerings and specifications at any time without notice. RRP Pricing and product information is correct at time of publication and is subject to change without notice. All images are for illustration purposes only. Lenovo makes every effort to ensure the accuracy of all information but takes no responsibility for any editorial, photographic or typographic errors. Lenovo reserves the right to correct any errors, inaccuracies or omissions and to change or update information at any time, without prior notice. Trademarks: Lenovo, the Lenovo logo and ThinkPad are trademarks or registered trademarks of Lenovo. Microsoft, Windows, Windows 10 Pro, and the Windows logo are trademarks of Microsoft Corporation. Other product names mentioned herein are for identification purposes only and may be trademarks and/or registered trademarks of their respective companies. Š2018 Lenovo. All rights reserved.