Cio april hybrid hyperdrive issuu by Sreekanth Sastry

LEADERSHIP

VOL/09 | ISSUE/06

BUSINESS

TECHNOLOGY

PRASANTH PULIAKOTTU, CIO, Sterlite Technologies, used a hybrid cloud strategy to lower capex.

HYBRID HYPERDRIVE In the last six months, thereâ&#x20AC;&#x2122;s been a sudden surge towards the hybrid cloud. What gives? Page 32

APRIL 15, 2014 | `100.00 W WW.CIO.IN

VIEW FROM THE TOP Technology has transformed NCDEX, says Samir Shah.

TAILORED PRESCRIPTION Mitra Biotech uses analytics to quicken cancer treatment.

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FROM THE EDITOR-IN-CHIEF

UBLISHER, PRESIDENT & CEO Louis D’Mello P ASSOCIATE PUBLISHER Parul Singh E D I TO R I A L

Legacy Gap Have you planned out how your second-line will take over from you? As he lay dying on a summer’s day in 323 B.C., Alexander the Great was asked whom his successor would be. The Macedonian emperor is said to have wearily turned to his generals and said that his empire would go to the strongest among them. Within a couple of years, the empire that had been carved out by the world’s first professional army over a dozen years of hard campaigning, self-destructed. A series of battles and assassinations later, Alexander’s relatives were dead; his legacy split three ways among the generals who survived. The empire that stretched from Egypt to Greece to Persia to Punjab was no more. In hindsight, the brilliance in strategy and tactics that made Alexander an undefeated military commander on the field of battle were nowhere on display. Granted, he was only 33 years old—not the age you think of handing over the baton. But having lived a life of uncertainty and violence in equal measure, it was always going to be a question of ‘when’ and not ‘if’. In this, the Macedonian’s vision was perhaps clouded by delusions of immortality. A CIO I know very well, looks at each organization he is associated with as a four-year project. A few months ago, he shared how his department’s organizational structure had evolved over the past few years. I was impressed with his efforts to radically change the way the team was structured, identify those with leadership potential and to specifically mentor them to take the organization ahead. He also decided on the kind of behavior to nurture that would be in keeping with the changes to the organization as a whole that the management envisioned. And, he built this into a part-formal, part-informal mentoring process. He recently moved over to another assignment. The transition to his team and its leaders was not only seamless but also painless. I needn’t have asked him what he was up to these days, for he predictably replied: “Well, over the next four years…” In the end, Alexander’s legacy was wiped out because despite a bunch of A-grade generals, he had no inheritors, no true inspiring leaders, no one who could take the Macedonian empire and build on it. Have you planned out how your second-line will take over from you? Are you fostering tomorrows leaders? Write in and let me know.

EDITOR-IN-CHIEF Vijay Ramachandran MANAGING EDITOR T.M. Arun Kumar EXECUTIVE EDITOR Gunjan Trivedi ASSOCIATE EDITORS Sunil Shah,Yogesh Gupta FEATURES EDITOR Shardha Subramanian SPECIAL CORRESPONDENTS Gopal Kishore, Radhika Nallayam, Shantheri Mallaya PRINCIPAL CORRESPONDENTS Debarati Roy, Sneha Jha, Varsha Chidambaram SENIOR CORRESPONDENTS Aritra Sarkhel, Eric Ernest, Ershad Kaleebullah, Shubhra Rishi, Shweta Rao SENIOR COPY EDITORS Shreehari Paliath, Vinay Kumaar LEAD DESIGNERS Pradeep Gulur, Suresh Nair, Vikas Kapoor SENIOR DESIGNERS Sabrina Naresh, Unnikrishnan A.V. SALES & MARKETING PRESIDENT SALES & MARKETING Sudhir Kamath VICE PRESIDENT SALES Sudhir Argula GM MARKETING Siddharth Singh GENERAL MANAGER SALES Jaideep M. MANAGER-KEYACCOUNTS Sakshee Bagri MANAGER MARKETING Ajay Chakravarthy MANAGER-SALES SUPPORT Nadira Hyder SR. MARKETING ASSOCIATES Archana Ganapathy, Benjamin Jeevanraj, MARKETING ASSOCIATE Arjun Punchappady, Cleanne Serrao, Lavneetha Kunjappa, Margaret DCosta, Shwetha M. LEAD DESIGNER Jithesh C.C. SENIOR DESIGNER Laaljith C.K. O P E R AT I O N S VICE PRESIDENT HR & OPERATIONS Rupesh Sreedharan FINANCIAL CONTROLLER Sivaramakrishnan T.P. CIO Pavan Mehra SR. MANAGER OPERATIONS Ajay Adhikari, Chetan Acharya, Pooja Chhabra SR. MANAGER ACCOUNTS Sasi Kumar V. SR. MANAGER PRODUCTION T.K. Karunakaran MANAGER OPERATIONS Dinesh P., Tharuna Paul MANAGER CREDIT CONTROL Prachi Gupta SR. ACCOUNTS EXECUTIVE Poornima

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contents APRIL 15, 2014 | VOL/9 | ISSUE/06

Case Files 52 | Mitra Biotech ANALYTICS A technology platform that uses data analytics allows Mitra Biotech to find the most effective cancer drug for specific patients in seven days—exponentially faster than traditional methods. By Shubhra Rishi

66 | Snapdeal

3 2

IN-MEMORY DATABASE As Snapdeal’s business grew 200 times, it needed its IT systems to scale and support its rapid growth. How its CIO made that happen. By Sneha Jha

32 | Hybrid Hyperdrive

4 8

COVER DESIGN BY UN NIKRISHNAN AV

COVER STORY | CLOUD COMPUTING In the last six months, something radical has changed in the cloud computing strategies of India enterprises. For the first time, the number of Indian CIOs pointing their enterprises towards a hybrid cloud model is equal to those focusing on private cloud. What gives? By Shubhra Rishi

40 | Bridge the CIO-CMO Divide FEATURE | CIO CAREER The battle between CIOs and CMOs is well-known, but how different are the two, really? To find out, we turned to the Myers-Briggs personality type test. By Tom Kaneshige

VIEW FROM THE TOP: “It’s important to have that the heads of business and IT are joined at the hip. They should work like a pair of Siamese twins," says Samir Shah, MD & CEO, NCDEX.

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2014

Big Data Analytics. The Next Wave of Business Transformation. Discover at India's Largest Analytics Forum on April 23, 2014 • Learn from the wisdom and experiences of business leaders who have embraced High-Performance Analytics and Data Visualisation • Network with solution experts and industry pioneers to gather best practices • Gain valuable insights on Visual Analytics and Data Management, Risk & Fraud Management and Integrated Marketing Management • Join us and discover the future of analytics and learn how it can empower you to succeed in today's ever-changing business landscape

Venue: Hotel Grand Hyatt, Mumbai Day and Date: Wednesday, April 23, 2014

For further information, Contact: Mr. Rahul Singh Email: rahul.singh@sas.com Call: +91 22 67492222

Scan the QR code to Register Now! Or visit: www.sasforum.com/in

SAS Institute Inc. product or service names are registered trademarks or trademarks of SAS Institute Inc. in the USA and other countries. ® indicates USA registration. Other brand and product names are trademarks of their respective companies. © 2014 SAS Institute Inc. All rights reserved. SXXXXXUS.0X13

DEPARTMENTS 1 | From the Editor-in-Chief Legacy Gap By Vijay Ramachandran

7 | Trendlines

6 0

14 | Alert Best Practices | Stay Ahead of Risk Risk Metric | Richter-like Scale for Data Breaches?

68 | Essential Technology

60 | IT Returns CXO AGENDA | INVESTMENTS Koushik Gopinath, Chief Investment Officer, Tata AIG General Insurance, illustrates how IT has been instrumental in helping keep the value of the company’s investment portfolio competitive. By Varsha Chidambaram

52 Columns 19 | The Trouble with IoT

Location-based Services | Track You Down Mobility | Your Phone’s Stalking You

72 | Endlines Retail Innovation | Supermarket Smarts By Loek Essers

3 2 0 5

THINK TANK Everything about the Internet of Things is cool. But underneath the magic of IoT lies the scary reality of the harm it can cause. CIOs, watch out. By Evan Schuman

21 | The Age of Ambient Everything FUTURE OF IT Trends in social, search, mobile, wearable and the Internet of things will alter our perception of reality. Change is in the air. By Mike Elgan

25 | IT Magnetism VALUE OF IT When the CEO asks the CIO to find a way to attract the business units to the IT function, with the ultimate goal of increasing revenue, the CIO realizes his staff is going to need some new skills. By Al Kuebler 4

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Gartner Business Intelligence & Information Management Summit 2014 9 â&#x20AC;&#x201C; 10 June | Mumbai, India | www.gartnerevent.com/in/bi1

The Future of Your Business: Transparent, Decisive, Personalized HoT ToPics New Styles of Analytics Information Governance Big Data Realities Master Data Management Information as an Asset Ethics and Cultural Considerations Analytical Skills and Capabilities

Save INR 5,500 Register using discount code EBBIAD2 by 11 April 2014 www.gartnerevent.com/in/bi1

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EDITED BY SHARDHA SUBRAMANIAN

NEW

HOT

UNEXPECTED

Now, You Can Spy Kids is bringing MDM to the household to treat actual children like children. Remo offers a currently free cloud service (although this may change) that gives admin rights to parents for monitoring, managing and controlling smartphones and tablets across Android, Windows 8 and iOS, as TRACK well as PCs and Macs. Of DEVICE course, it’s not as complex as enterprise-class MDM SMARTPHONES but does offer an array of TABLETS services, including data back up and sharing. PCS “Basically, we’re connecting the entire family on a virtual network,” says Remo Software CEO Omer Faiyaz. More than just a way to spy on teenagers—and spouses-Remo can wipe home

data for lost or stolen devices. Parents often use devices to access work files, pay bills and store confidential data that they wouldn’t want in the hands of strangers. Also, parents might want to keep offensive Internet content away from their children; 95 percent of teens have easy Internet access, and 68 percent have seen offensive content. Parents can also flag and read individual text messages, according to Faiyaz. It is very much possible on Android. He says the process is similar to antivirus software, which has the capability to read messages and alert you whether or not they are safe to open.

TRENDLINES

So your grinning teenager is texting away at the dinner table, flashing a mischievous smile between bites of pizza. You might ask, “Whatcha writing?” You’ll surely get a look of sweet innocence followed by, “Nothing.” Well, a new service allows you to read those not-so-innocent text messages, track device location, remotely wipe data and perform other security functions similar to those of mobile device management software, or MDM. Teenagers everywhere, if they only knew, would be shuddering in horror. For the last few years, companies have been using MDM to keep tabs on employee devices and data, even personal devices under a BYOD (Bring Your Own Device) policy. In turn, employees complain that managers wielding MDM treat them like children. Now a company called Remo Software

MOBILITY

—By Tom Kaneshige

Room for Entertainment

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Rs 945), and $25 per hour (about Rs 1,575) in New York. So far, only a handful of rooms are available to be booked with the service in Manhattan, in areas near Penn Station and also in Soho and the Flatiron District. But the company is looking to add a few more, said Julien Smith, Breather’s chief executive. Breather’s rooms are located in commercial office space, but are tastefully upholstered with modern furnishings to facilitate relaxation. There’s a reason, after all, the company is named Breather. In some cases, “it’s a weird living room lounge feel,” said Smith. The app uses the

geo-targeting capabilities on a person’s iPhone to display nearby available rooms on a map. The user selects a room for a certain period of time, and when the reservation begins, a code appears on the phone that he or she can use to unlock a keypad on the door to the room. Users are charged to the credit card they have on file with Breather for the length of their stay. The app is seeing some early action— it has tens of thousands of downloads so far, Smith said, although he could not cite off-hand the number of bookings done through the service.

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Breather, a startup offering a mobile app that lets users rent private rooms on demand, is looking to break new ground. Breather’s service operates almost like Airbnb, but with a short-term twist focused around work.“Think of us as your second home or office, wherever and whenever you need it,” the company proclaims on its website. But it doesn’t have to be about work. The rooms, the company says, are designed to help people focus, meet clients, work, or relax. They can be reserved for as little as 30 minutes, a few hours or an entire day. In Montreal, rates for the rooms are US$15 per hour (about

MOBILE APPS

— By Zach Miners

REAL CIO WORLD | A P R I L 1 5 , 2 0 1 4

Time Travelers Surfing the Web?

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FriendSpotting, and More Sidecar is testing a feature to show the “trending” destinations of the ride-sharing apps’ users. “Trend Spot,” as the feature is called, is nearing launch among a select group of early users. Should it roll out more broadly, it could help Sidecar distinguish itself from a growing array of competitive apps like Uber and Lyft that are attracting attention from smartphone users, investors and regulators alike. Sidecar’s paid drivers, who are also app users, are connected with people who need rides in the 10 cities where the service operates. Sidecar declined to comment about the feature other than to say it was one of several programs the company is testing. An early invitation notice for the tool said that it would make it easy to see which locations in a person’s city are trending, and where that person’s friends are going. Sidecar lets its users invite their friends to the service from their device’s native contact list, but does not require that users import their contact lists, so it is not clear how it will determine with whom a user is friends on the service. “Trend Spot keeps tabs on all the trending destinations in the city based on Sidecar rides,” the company said. “We’ll even tell you which locations are trending among your own friends,” Sidecar said. It might seem to be a curious way to use a mobile ridehailing service. Imagine opening the app and seeing the message, “Sidecar is delivering lots of people to Fenway Park right now—must be a happening spot!” Or, “Three of your friends just arrived at a bar near the White House!” Would anyone make plans, or change existing plans, based on that kind of information? Maybe it wouldn’t matter. Trends of who’s going where, in the aggregate, could be an interesting way of discovering things you didn’t know were happening in your city, much like trending information on Twitter sometimes leads people to discover news stories, said Arun Sundararajan, professor of information, operations and management sciences at New York University, who studies digital economics. APPS

—By Zach Miners

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TRENDLINES

I N T E R N E T If there are time travelers out there, they aren’t talking about it on Twitter or Facebook. At least according to research conducted by Michigan Technological University which published a paper “Searching the Internet for evidence of time travelers.” “We had a whimsical little discussion about this,” said Astrophysicist Robert Nemiroff, a professor at the university. The result was a fun-but-serious effort to tease out travelers visiting from the future by sifting through the Internet. Unfortunately, they have uncovered no DeLorean time machines, but that hasn’t made the search less interesting, he said in a statement. Nemiroff said you can’t just put out a cattle call for time travelers and expect good results, so his team developed a search strategy based on what they call prescient knowledge. If they could find a mention of something or someone on the Internet before people should have known about it, that could indicate that whoever wrote it had traveled from the future. To conduct their research, the researcher said they used three search implementations. Specifically in this study, the researchers conducted a series of searches for digital signatures that time travelers potentially left on the Internet. Specifically, we search for content that should not have been known at the time it was posted— or what the team called “prescient” information. “The first search covered prescient content placed on the Internet, highlighted by a comprehensive search for specific terms in tweets on Twitter. The second search examined prescient inquiries submitted to a search engine, highlighted by a comprehensive search for specific search terms submitted to a popular astronomy website. The third search involved a request for a direct Internet communication, either by e-mail or tweet, pre-dating to the time of the inquiry.” In the end, no time travelers were discovered. “Unfortunately, as of this writing, no prescient tweets or e-mails were received,” the researchers stated. The authors however, are not convinced that their coming up with zero means zippo to time travel theory. “Although the negative results reported here may indicate that time travelers from the future are not among us and cannot communicate with us over the modern day Internet, they are by no means proof.” — By Michael Cooney

Touchy-feely Tablet Fujitsu has developed a prototype tablet that lets users feel realistic textures of images displayed on the screen. The 10.1-inch haptic tablet is the first of its kind to use ultrasonic vibrations to create a sense of tactile sensations, according to Fujitsu. It can convey a feeling of slipperiness or roughness that could accompany images such as a wet surface or the skin of an alligator. Other companies have created similar prototypes, but Fujitsu Laboratories’ take on the idea uses ultrasound to change the friction between the touchscreen and the user’s finger. To create a floating, slippery effect, the tablet generates a high-pressure air layer just above the screen. That reduces friction and creates the illusion of slipperiness. To create a bumpy or rough effect, the device generates high- and low-friction zones through ultrasonic vibrations. The tactile, visual and audio sensations can create a rich illusion. “Fujitsu’s method of using ultrasonic vibrations achieves an unprecedented slippery sensation, while keeping noise to a minimum,” a Fujitsu spokesman said. “We are proud of the advanced audio and visual technologies our products offer, and with this new technology, we are exploring ways to appeal to even more senses for a more complete experience.” The spokesman emphasized the technology is still at an early stage of development, but applications might include electronic catalogs that would generate a sense of texture for their products. — By Tim Hornyak

Technology Trendsetters I T S T R A T E G Y Cloud, mobility and social media have been top priority for the last two years for CIOs. But interest in these technologies is increasing in 2014.

Technology

57%

51% 45%

Private cloud

43% 42% 34%

Mobile apps Social Media Public cloud BYOD

26% 23%

Adopting

Researching Source: CIO Research

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Follow the Customer

A growing number of brick-and-mortar businesses, eager to learn more about what goes on inside their walls, are turning to new technology to gather data from people’s mobile phones. Two analytics companies active in the budding industry known as location-based marketing said that their technology, which uses Bluetooth-sensing transmitters or “beacons,” would be coming to more stores. The businesses include jeweler and fashion retailer Alex and Ani, and probably many more brand and department stores. There’s more happening outside the mall. The Major League Baseball organization said that it had completed its installation of Apple’s iBeacon technology at two of its parks—Dodger Stadium in Los Angeles and San Diego’s Petco Park—with roughly 20 more stadiums slated to get the technology. There’s a slew of startups and indoor analytics companies trying to make headway in the industry, and different companies offer different services. But the basic idea underpinning the deployments is to let businesses gather new information about their customers, like foot traffic and dwell times, and send them promotions, using signals from their mobile phones. Everything is supposed to be superlocalized, so a consumer might get pinged on their mobile phone about a particular perfume or cologne, but maybe only if he or she walks by the makeup aisle. MLB said that it would be developing new features for its At the Ballpark mobile app, which would talk to Apple iBeacons installed throughout the parks. Based on a demo last year of the new app, the features might include digital videos or photos surfaced at points of interest around the stadium, or coupons that appear if a person walks into the souvenir shop. This much is clear: Retailers, or sporting venues, hope to expand their business with the technology. It’s a big investment they’re making. And sometimes, the technology requires the consumer to download a particular mobile app, which could lower the return on that investment if customers aren’t on board with it. Alex and Ani’s rollout is based on its deployment of technology from Swirl, which uses Bluetooth low-energy beacons in stores to push offers to customers, and gives the retailer tools to measure shoppers’ activity in the store. —By Zach Miners L O C AT I O N - B A S E D S E RV I C E S

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TRENDLINES

DEVICES

Lightning Fast Networks cuts the amount of work being done on writing program code and allows computers to efficiently tackle complex problems. One day, an airline might want to use this optimization algorithm to find the most efficient way of scheduling its flight crews, for instance. Or a router may use it to calculate the fastest path through a busy network. The algorithm doesn’t have an official name yet, though it is being referred to as the “KLOS algorithm” after the first letters of the last names of the primary authors (Kelner, Yin Tat Lee, Orecchia and Aaron Sidford—who are all from MIT). Today, optimization problems are usually solved using one of a number of maximum-flow algorithms, often shortened as max-flow. Max flow models a network by constructing a graph that represents all the end-points as nodes and all the connections among them as edges. It then estimates the most efficient way to route traffic through the network, given the maximum capacity of each node. The new algorithm tests all the paths, or edges, at once.

TRENDLINES

A group of researchers at MIT have devised a potentially more effective way of helping computers solve some of the toughest optimization problems they face. Their new algorithm is more computationally effective than other approaches, because it scales in a “near-linear” fashion, according to Jonathan Kelner, an associate professor of applied mathematics at MIT and a member of MIT’s Computer Science and Artificial Intelligence Laboratory, who co-authored the new algorithm. “The running times for previously known algorithms scaled substantially worse than linearly,” Kelner wrote by e-mail, meaning that as a problem becomes more complex, the performance of the computer undertaking the problem slows dramatically. Linear scaling means that the time it takes to solve a problem using a formula is more or less directly proportional to the size of the problem space being studied. While the appearance of a potentially powerful new algorithm may not be as exciting as the latest gadgets from the Consumer Electronics Show in Las Vegas, it could ultimately have deeper repercussions for the industry, if it significantly

NETWORKING

—By Joab Jackson

Gone with the Wind The Mission: Impossible TV show famously started most episodes with a tape recorded mission message that ended with: “This tape will self-destruct in five seconds, good luck Jim.” Then it melted down in a burst of smoke and flame. DARPA researchers seem to want to take that sort of destructive notion quite a few steps further by designing electronics—particularly smart phones and other devices— that can melt or at least partially dissolve to the point that they would be useless to anyone else who came across them. From DARPA: The Vanishing Programmable Resources (VAPR) program has the aim of revolutionizing the state of the art in transient electronics or electronics capable of dissolving into the environment around them. Transient electronics developed under VAPR should maintain the current functionality and ruggedness of conventional electronics, but, when triggered, be able to degrade partially or completely into their surroundings. Rendering

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POPULAR SCIENCE

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them useless to an enemy. DARPA says that because “sophisticated electronic microsystems can now be made at such low cost that they are increasingly pervasive throughout the battlefield and large numbers can be widely proliferated and used for applications such as distributed remote sensing and communications. However, it is nearly impossible to track and recover every device, resulting in unintended accumulation in the environment.” “DARPA is looking for a way to make electronics that last precisely as long as they are needed,” said Alicia Jackson, DARPA program manager. DARPA said it expects VAPR research will develop what it calls a number of revolutionary and meaningful military capabilities including sensors for conventional indoor or outdoor environments, environmental monitoring over large areas, and simplified diagnosis, treatment, and health monitoring in the field. —By Michael Cooney

REAL CIO WORLD | A P R I L 1 5 , 2 0 1 4

C O M P I L E D B Y VA R S H A C H I D A M B A R A M

Best Practices

Mind the Gap

Of all the countries in the APAC region, top Indian executives are the least paid. The gap is only widening.

TRENDLINES

According to the Global 50 Remuneration Planning Report, published by Towers Watson, there is a widening disparity in pay levels particularly between the middle management and CEO levels in 13 of Asia Pacific’s key developed and developing economies. Predictably, the biggest pay masters are developed countries like Australia, where entry pay level is eight to 15 times more than other countries in the APAC region. But it’s interesting to see where India stands among the other developing economies, most notably China. Top management in India gets around $90,000 to $1, 20, 000 annually (about Rs 56 lakh to Rs 75 lakh). That is the lowest in the whole of APAC. Compare this to China, where top management gets in the range of $160,000 to 220,000 (about Rs 100 lakh to Rs 138 lakh) as annual compensation. At the highest end of the spectrum is Australia, where the top management gets paid in the range of $260,000 to $310,000 (about Rs 163 lakh to Rs 195 lakh) annually. One factor that has majorly contributed to this stark difference is the dismal performance of the rupee against the US dollar, compared to the renminbi that actually appreciated in the same period. Despite the high levels of inflation in India, this gap has been widening.

DEVELOP new skill sets. In order to get better compensation, senior management needs to hone the skills that are likely to benefit their organizations.

STEP out of your comfort zone. Doing what you always do will yield the same results. Think out of the box and get innovative by dabbling with something you haven’t done before.

KEEP your options open. On a lighter note, moving to either China or Australia can open up better prospects of getting higher compensation.

Gaping Hole times

Australia’s entry pay level is higher than that of developing countries in the APAC region.

Top Management

Australia: About Rs 163 lakh—Rs 195 lakh China: About Rs 100 lakh—Rs 138 lakh India: About Rs 56 lakh—Rs 75 lakh

8.5% The average salary increase of executives in China.

SOURCE: PWC GLOBAL CEO SURVEY 2014

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8 to 15

Annual Compensation:

ADVERTORIAL AND PROMOTIONAL FEATURE AKAMAI

KEY CONSIDERATIONS

For Successful Cloud Migration

A safe, reliable cloud experience enables the agile enterprise. When operating and innovating within today’s hyperconnected world, a reliable and robust cloud computing solution is essential.

one right, cloud enables the efficiencies necessary to support an agile business, a mobile workforce, and a global user base. By providing on-demand access to applications and resources anywhere, cloud computing offers significant cost savings, operational scalability, and an accelerated time to market for the agile enterprise. CIOs are managing an increasingly heterogeneous environment made up of private cloud, public cloud, and SaaS-based applications. To better manage this complex ecosystem, they will need to take a more holistic approach to utilities like load balancing, DR, security, and performance optimization. Akamai has tapped into their experience delivering thousands of cloud applications to present some key factors to consider as you develop your cloud migration strategy.

acceleration solutions can performance compromises.

offset

4. How do you satisfy compliance obligations in the cloud? Compliance is not optional and “everyone’s doing it” doesn’t prevent fines. Make sure your cloud vendors make their processes transparent and give you recourse to audit them. 5. Will you have business continuity if your cloud provider goes down? With little tolerance for downtime, many businesses are using cloud platforms to load balance across multiple cloud providers for lower risk and vendor independence.

1. What’s your strategy for expanding capacity? You don’t have a limitless budget to build data centers. To support business growth cost-effectively, engage partners that make it possible for you to scale on demand.

6. Can you apply security consistently across applications in the cloud? It’s challenging – and complicated – to implement security and firewalls on all your cloud providers. New cloud security providers make it possible to set consistent policies across all your applications, no matter where they’re hosted.

2. Are your users located close to your applications? The further users are from your applications, the more likely they are to encounter Internet bottlenecks, slow performance, poor availability, and low adoption.

7. Where in the cloud are your SaaS providers? Ask whether your SaaS providers use a globally distributed application delivery platform to ensure optimal performance and 100% availability of your SaaS applications.

3. Is your organization undergoing data center consolidation? As you consolidate, more users will be further from your applications. Cloud

8. What’s your goal for cloud: cost reduction or productivity gains? As cloud becomes the infrastructure standard, enterprise goals will shift from cost reduction

to productivity gains. To achieve these gains you will need to ensure unfettered access, high performance, and high end-user productivity. 9. Can users access your cloud applications in a BYOD world? Enterprises must deliver their applications to a Bring Your Own Device world. Does your cloud infrastructure support all end-user device types and allow you to scale optimizations for delivering mobile applications and Web sites? 10. Are you using hosted analytics? In the era of Big Data, your ability to act on data is directly related to how quickly you can ingest, aggregate and analyze it. You need a solution that helps you transmit data to your analytics tool as quickly as possible. As your cloud migration strategy evolves, you’ll come to consider a cloud platform that provides you with greater consistency and control. Leverage the Akamai Intelligent Platform to help ensure your cloud strategy empowers both IT and the Business to innovate using a well-coordinated, efficient, and resilient approach. To learn more, visit our Web site for access to valuable whitepapers such as IDC’s guide, Next-Generation Application Delivery in the Era of Cloud.

This feature is brought to you by IDG Services in association with Akamai

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Stay Ahead of Risk N

IMAGES BY THINKSTOCKPHOTOS.IN

o matter how valiant the efforts of chief security officers, or how much businesses say they focus on securing their systems, or the amount of money spent on IT defences—many of the same IT security challenges persist. Enterprises lag in their ability to swiftly detect breaches—an important measure of security maturity. According to the 2013 Verizon Data Breach Investigations Report, 62 percent of organizations didn’t detect breaches for months, or longer—and partners and customers, or others identified about 70 percent of breaches. There’s clearly much room for improvement, but as the number, duration, and costs of attacks reveal, there certainly won’t be any quick fixes. However, according to the experts we’ve spoken to there are a handful of areas that, if dramatically improved, would significantly shorten today’s chasm between defender and attacker.

Close the Skills Gap

A challenge repeatedly cited is finding security talent. Recently, a survey from the International Information Systems Security Certification Consortium found that 56 percent of organizations believe their security departments are understaffed. “We are always seeing conversations about staffing concerns,” says Daniel Kennedy, research director for information security and networking at 451 Research. “And it’s not just small and mid-sized companies that are having trouble finding and retaining talent, it’s a problem even at the top,” he says.

Shifting Away From Compliance Mindset One of the most necessary shifts is that from a focus on regulatory

Blinded by Compliance FINDINGS

IS Spending Drivers

audits and compliance to security risk management. Many enterprises have spent years—justifiably—with a focus on regulatory compliance. However, many say, the focus remained too intently on compliance and not enough on the essential security of their data, applications, and infrastructure. And despite this focus on regulatory compliance, there’s little in way of improved outcomes to show for the effort. According to the latest Global Information Security Survey, conducted by PricewaterhouseCoopers, CSO, and CIO magazine, the loss or damage of internal records more than doubled in one year. “This focus on regulatory compliance, rather than security, has been underway for many years,” says

The focus on regulatory compliance—rather than enterprise risk—is a danger with a over a third of Indian CIOs saying that compliance is what drives information security spending.

Economic conditions

43%

Digital convergence trends (VoIP, etc.)

25%

Business continuity / disaster recovery

41%

Hacktivism (major leak of confidential information, e.g., WikiLeaks)

20%

Change and business transformation

37%

Merger / acquisition activity

17%

Company reputation

35%

IP theft due to nation-state espionage (advanced persistent threat)

16%

Internal policy compliance

33%

Criminal theft of customer or employee information

14%

Outsourcing

33%

Terrorism

Regulatory compliance

30%

A P R I L 1 5 , 2 0 1 4 | REAL CIO WORLD

SOURCE: GISS

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Candy Alexander, former CISO at Long Term Care Partners, and currently a member of the board of directors at the Information Systems Security Association. “When the focus is on compliance, you are not talking about people who are proactive about going out and making themselves more secure. They’re just focused on baseline controls,” says Kennedy. “Compliance is generally a lagging indicator [of risk],” he says. The result of that “baseline control” approach is “checkbox security” says Kenney and Alexander. “It’s not pie-inthe sky to say that compliance should be an output of a security program, not a primary input,” says Kennedy.

Improve Incident Response The security industry is disproportionately vested in preventative security defences—with precious little spent on the ability to detect and respond to breaches when they (and they always do) occur. “We need a fundamental shift from so much focus on preventative controls to detection and response,” says Jay Leek, SVP and CISO at the Blackstone Group. Leek says, in a recent evaluation of the industry, that the vast majority of investments, 70 to 80 percent, are made to block attacks. “That should shift down to 50 percent,” he says. With the other half going to investments that provide visibility into the activities on systems and data, as well as tools to help make swift and intelligent response. Why is the industry so heavily geared toward blocking, rather than responding to the inevitable? Most agree that it’s part human nature (believing one can block danger). Others blame it on the vendor community for selling messages

that attacks could be blocked, and also because it’s also an easier sell to make to business executives. Also most regulatory compliance mandates call for a heavy focus on preventive controls, over detection and response. “The ability to respond is absolutely necessary, but it’s just not as easy to sell across the board,” says Kennedy.

Communicating to the Business, Not at It This communication chasm still persists at too many organizations, most agree. Many security professionals still have a challenging time elevating the IT security discussion to a level that is relevant to business executives. That’s largely because they continue to view themselves as security practitioners, rather than a security professional participating in the industry their organization operates, says Eric Cowperthwaite VP, advanced security and strategy at Core Security and former CISO at Providence Health and Services. Alexander agrees. “Communication is still a very common problem. There is a challenge for many to explain complex and technical risks in a way that makes sense to a business executive. But that’s what we need to do. We need to talk in their terms in order to be persuasive and reach them,” she says. What executives need to make educated IT risk decisions are security pros that understand both the technology and the nature of the business and industry they’re in.

“Executives want you to gear yourself as being as responsible for the business just as much as they are. And they want you to sit down and collaborate to figure out how to get better security without interfering with business objectives,” he says.

Shift to Data-based Decision Making The final fix is moving from making gut decisions, working off checklists, and blindly following best practices to more data-driven decisions. “What we are doing is playing whack-a-mole. We find the things that we are bad at (or cause breaches) and we fix it,” says Jay Jacobs, VP at the Society of Information Risk Analysts. “The problem is that there’s always something else that comes next. And the adversary is intelligent and can adapt, so they just move on [to the next vulnerability],” Jacobs says. “What really would be a dramatic improvement is if we start using the home field advantage that we have and start to collect the data in our environment and make sense of it,” Jacobs adds. That means better log analysis, more spending in big data security analytics, and better anomaly detection. This can give researchers more speedy insight into things that need to be investigated “I think adopting that technology would be a dramatic improvement. Unfortunately it’s a pretty steep hill to climb for most organizations,” he says. CIO George V. Hulme writes about security and technology from his home in Minneapolis. Send feedback on this feature to editor@cio.in

India is not prepared to handle a sophisticated cyber attack as it faces a serious shortage of trained professionals.

[ONE LINER:]

— JAY BAVISI, PRESIDENT AND CEO, EC COUNCIL TO PTI

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Ranking Data Breaches on Richter-like Scale

A P R I L 1 5 , 2 0 1 4 | REAL CIO WORLD

is stolen but cannot be deciphered by cybercriminals because it is encrypted, rendering it useless to them,” said SafeNet’s VP of cloud solutions, Jason Hart. Interestingly, the BLI’s sector breakdown accords roughly with 2013 numbers from US nonprofit, the Identity Theft Resource Center (ITRC) in that sectors such as healthcare report a large number of individual breach incidents (31 percent) that account for only a small number of records (2 percent). In contrast, the tech sector has relatively few breaches (11 percent), but these tend to be much larger (43 percent of the records), giving an average of 5.7 million records per breach. This tells us

Smartphone Kill-switch

ata breaches are a bad thing but are some worse than others in a way that can be measured objectively? Encryption firm SafeNet believes its new Breach Level Index (BLI), developed jointly with security analyst Richard Stiennon’s IT-Harvest, offers a solution. Covering 2013, the 575,486,661 records breached offers a disturbing new high-water mark for what we know has been happening even if it covers only incidents that were publically-disclosed. But instead of simply ranking publically-disclosed breaches by the number of records compromised, the BLI sets out to order them as one might for earthquakes or hurricanes, using a logarithmic scale. Using that, the recent Target and Adobe breaches (a combined total of 262 million records) score a maximum 10.0, the Evernote breach from earlier in the year (50 million) scores 8.8, while the relatively tiny MacRumours forum break-in (860,000 records) is a 7.8. This means that “a score of 7 is 100 times more severe than a score of 5,” to borrow the SafeNet’s own description of how its scientific methodology works. One danger in this approach is that people don’t understand data breach logarithms any more than they understand the Richter scale for earthquakes; a 7 sounds worse than a 5 but not 100 times worse. Another issue is that a quick check of the BLI database shows that severity (i.e the rating) lines up with breach size, a long-winded way of saying that the most massive data breaches are overwhelmingly the most severe. For breaches, big is always bad but sometimes simply very bad. SafeNet still thinks it has hit on something. “Not all breaches are created or should be treated alike. The Breach Level Index helps us track and differentiate between an insecure breach, in which customer data is compromised and lost, and a secure breach, where data

something about the state of the databases held in these sectors; healthcare holds databases that are fragmented and smaller while technology firms have consolidated these into super-databases. It follows that fragmented databases are harder to protect but offer hackers fewer records when compromised. Despite its proprietary methodology, the BLI still does the useful job of cataloguing publically disclosed data breaches, not just from the US (which has good breach disclosure laws) but across the world. It is also a useful source for information that tends to be fragmented across different websites. CIO John E Dunn writes for Techworld.com. Send feedback on this feature to editor@cio.in

Pressure on the American cellphone industry to introduce technology that could disable stolen smartphones has intensified with the introduction of proposed legislation that would mandate such a system. Senate bill 2032, “The Smartphone Prevention Act,” was introduced to the US Senate by Amy Klobuchar, a Minnesota Democrat, and covers smartphones, tablets and any personal electronic device on which commercial mobile data service is provided. It requires a function that allows the subscriber to remotely remove personal data stored on such devices and to render them inoperable on the networks of any mobile carrier globally. The function should also be resistant to the device getting reactivated by another carrier, reprogrammed or reset unless a passcode or similar authorization is provided by the subscriber. The bill specifies that the remote wipe and “kill-switch” function “may only be used by the account holder” and will apply to all such devices manufactured or imported in the US from January 1, 2015. There is an exemption for “low-cost, voice-only” phones. It also specifies that carriers “may not charge the account holder any fee for making the function ... available.” The penalty for breaking the rule isn’t specified in the bill. — Martyn Williams

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Evan Schuman

THINK TANK

TheTrouble with IoT Everything about the Internet of Things is cool. But underneath the magic of IoT lies the scary reality of the harm it can cause. CIOs, watch out.

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hen you and your colleagues in IT hear the CEO talking about the Internet of Things, the excitement in the CEO's voice means only one thing: You're unlikely to be home in time for dinner for quite some time. Boards and CEOs see all of the potential benefits of this all-inclusive toasters-and-vacuumcleaners-connected-to-the-Internet scenario and think little of the nightmarish risks. I mean, what could possibly go wrong when you have dozens of household appliances and devices being controlled by any seemingly authenticated person on the other side of an Ethernet connection? For starters, you could point out to the higher-ups that the Internet of Things has the potential to introduce millions of new backdoors into networks, putting proprietary information at risk. But you know what they'll tell you: "Well, it's your job to make sure that doesn't happen. Take care of it." If you spin up more elaborate threatsâ&#x20AC;&#x201D;such as someone taking over your oven, turning on the gas and turning off the pilot lights and blowing you upâ&#x20AC;&#x201D;they'll likely say that you've been watching too many bad movies. But being responsible for the information and device security of all of these things is only half the nightmare. How about handling the oceans of new data that you'll be responsible for managing, protecting and analyzing? You thought mobile data avalanches were bad? Wait until every car, refrigerator and vacuum cleaner is sending you files. And while you're dealing with all that, who in your company is keeping the alarming privacy threats of the Internet of Things in check?

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Evan Schuman

THINK TANK

If you think all this sounds silly, take a look at Google's purchase of Nest, a sophisticated household thermostat. Talk about data potential. What do you think is going to happen when you give a company that makes its money from advertising a window into your temperature settings? If you're someone who is always cranking up the heat, Google might send you an offer for 20 percent off electric blankets, firewood or two weeks in the Caribbean. Does that not seem all that intrusive to you? (Excuse me; I meant helpful.) Well, then, let's say that your Nest thermostat has recorded a long history of you keeping the thermostat at 71 degrees during the winter months but you suddenly start to set it at 66. Google's algorithms take note, make some calculations and conclude that you are in dire financial straits. Now you're getting offers for low-interest loans or selling your gold jewelry for cash now. Maybe your neighbor doesn't realize that you've been laid off, but Google does. But this isn't just about Google wanting to know all about youâ&#x20AC;&#x201D;though heaven knows its appetite for information about everyone on the planet is ravenous. Lots of companies want to get into this game, all in the name of making life easier for you, though somehow it manages to fall to their advantage. Consider the vacuum cleaner. Now consider a young man who owns a networked vacuum, which notes that the young man goes from hardly ever running the vacuum to using it every few days. Result: Young man is inundated with offers of discounts on flowers, candy boxes and dinners for two. He can only hope Google, Amazon or whoever is behind those offers doesn't spill the beans to mom before he has a chance. Then there's the grand poobah of household appliances, from an advertising perspective: The networked refrigerator. By scanning the barcodes of its contents and monitoring containers' weight, the smart fridge can keep you informed about expiration dates and an impending exhaustion of supplies. ("Your milk is two days past its expiration date, and you have only two cold beers left.") Makers of those products are going to love having a new and compelling way to nudge consumers to buy more stuff. Meanwhile, back in the IT datacenter, all of that data, from all kinds of appliances, will be pouring in, on top of the steadily increasing mobile datalanche you've been seeing for the last year or so. And you still have to deal with those potential backdoors that you warned the CEO about, the ones he told you are your problem. You are not being overly paranoid about

that. We have precedents. Remember when printers and scanners started getting network access and some rudimentary intelligence? IT was thrilled, until it realized that printers had become highly insecure backdoors into corporate networks. That security threat was obscured by all of the cool things these devices could potentially do. Because who is going to deny that it's cool when your printer can recognize that your 228-page print job can't be completed because it has only 100 sheets of paper loaded, and that printer also has the smarts to send your job to a printer with 250 sheets loaded? Then that second printer realizes that those 250 sheets don't have the letterhead you need for this job, so it finds another printer better equipped for your needs. And the third printer assesses the sensitivity of what you plan to print and sends your job to a printer that has enough paper with the proper letterhead that is located behind a locked door. And it lets you know where to pick up your job and advises you that, since you lack the clearance to get into that room, you are going to need to get someone to let you in. You respond that you need this printout for a meeting at 2 p.m. in conference room 4660, and it calculates when it needs to start the print job and finds yet another printer

The Internet of Things comes with some serious risks that you will need to clean up. But CEOs tend to get obsessed with all of the good things that a new initiative can do and assume that someone else has their back. That would be you.

A P R I L 1 5 , 2 0 1 4 | REAL CIO WORLD

that meets all your criteria and is located just steps from that conference room. I mean, all of that is very cool! And so is the Internet of Things. But like those printers, the Internet of Things comes with some serious risks that you and your IT teams will need to clean up. But CEOs tend to get obsessed with all of the good things that a new initiative can do and assume that someone else has their back to ward off any potential dangers. That would be you. So get ready for a lot of new work, because the advantages of the Internet of Things are far too powerful to stop. CIO

Evan Schuman was the founding editor of retail technology site StorefrontBacktalk and he is a columnist for CBSNews.com, and RetailWeek. Send feedback on this column to editor@cio.in

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Mike Elgan

FUTURE OF IT

The Age of Ambient Everything Trends in social, search, mobile, wearable and the Internet of things will alter our perception of reality. Change is in the air.

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hile shopping at the grocery store recently and wearing Google Glass, I got an incoming social media alert referring to a phrase used by the Pew Research Center: “Ambient news.” Wait, what the heck is ambient news? Pew uses that phrase to characterize the experience of getting news in social streams, especially on the social sites Reddit, Twitter and Facebook. People are increasingly getting their news as part of their social networking activity. This replaces an older model of "news time," where someone would sit down to read the newspaper or watch the evening news. "Ambient news" means that news information just appears, scrolls by and then vanishes, mostly in the cognitive background. I had to laugh at the incoming alert, because (thanks to Google Glass), the news about ambient news was itself ambient—floating in space over the frozen foods section. The experience got me thinking about the future. It's clear that mobile notifications, wearable computing, preemptive search, the Internet of things and location-based commerce are all conspiring to make everything ambient. Not just news. People talk a lot about ‘context’—the idea that information available to us will constantly change based on where we are and what we're doing. But the term ‘context’ looks at technology from the industry's point of view. It's how providers of location-based data think about how, when and where to serve up information. But from the user's point of view, the core attribute of this contextual data is ‘ambience’. It will just be there with us all the time. Location-based information doesn't ‘feel’ like context. The person receiving that information doesn't think "Oh, OK. This makes sense

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Company

Cognizant Technology Solutions

Industry

IT, Consulting, and BPO

Headquarters

New Jersey

Employees

171,000

A STRONG STORAGE

STRATEGY

Presenting the story of how EMC Isilon helped Cognizant Technology Solutions fulfill its internal storage needs, simplified data management, and ensured that business-critical data stays within the companyâ&#x20AC;&#x2122;s IT perimeter. By Aritra Sarkhel

CUSTOM FEATURE EMC

oliere, the famous French playwright, once said, “The greater the obstacle, the more glory in overcoming it.” One look at the implementation spearheaded by Venkatesh Balaji, director-NSS at Cognizant Technology Solutions, would reveal that he attained his glory by overcoming the complex storage challenges that his organization faced.

the network. We realized that we could not have our internal content move to an external cloud. We can only allow prototypes to move to the cloud and not critical employee data. And that is where we realized that we should create our own cloud storage which is available on the network for intranet employees,” says Venkatesh.

THE ORGANIZATION

Facing such a huge and daunting task, Venkatesh and his team sprang into action instantly and started actively looking out for options in the market. “We were contemplating as to what will sit on the Gold and Silver layers. After much thought, we

Cognizant is one of those organizations that hardly need any introduction. The US-based MNC, which is a leader in the IT, consulting, and BPO industry, finds a place in the prestigious Fortune 500 list and has been recognized as one of the “World’s Most Admired Companies” multiple times. It is majorly based out of India, with most of the data supporting internal processes for ERP and applications hosted in the country as well. Cognizant’s business has been growing consistently that in 2014, it expects about 16.5 percent growth in revenue. Therefore, it was imperative for the underlying IT infrastructure to scale up in direct proportion and be robust enough to support business growth. Highlighting this critical need, Venkatesh says, “Over the years, the datacenter has evolved from an isolated to a consolidated network and it was during this time that we started looking out for a storage vendor who could partner with us and help us solve our major data consolidation plans and issues,” points out Venkatesh.

THE BUSINESS CASE A few years ago, the senior management, which included the former CIO for the India region, put forth a challenge in front of Venkatesh and his core team. “The management challenged us to find a technology which is capable of handling the storage needs of Cognizant’s internal system. They wanted a solution which could fulfill the application team’s requirement and do so at a low cost,” says Venkatesh. Cost reduction and internal management were not the only causes put before Venkatesh; the task of giving employees a catalog of Silver, Gold, and Platinum storage to handle the internal IT application portfolio and system was one too. As if this wasn’t a huge challenge in itself for Venkatesh’s team, there were other pertinent issues as well. Data security, as always, was a major concern. “When we started moving on to the cloud in the last five years, the data started moving out of

THE SOLUTION

"No single points of failure and fully journalled file systems with low or no latency at all have made EMC Isilon our preferred storage vendor for our internal cloud storage." -Venkatesh Balaji, Director-NSS, Cognizant

decided that our SSD-based storage and memory-based storage will sit on Platinum, whereas our disc-based storage would sit on Gold. For the Silver layer—which would serve as a private cloud for employees alone—we needed to find something that was affordable, highly scalable, and easy to adopt at the same time,” says Venkatesh. After much research, he and his team chose the EMC Isilon brand for the Silver layer. The POC went for a period of month. The implementation that followed went like a dream for both Cognizant and the EMC brand. “The EMC Isilon brand lived up to the expectations from the perspective of basic storage. We procured a petabyte storage from EMC Isilon and built a rack around it so that it

acts as a Web-enabled storage for anyone to consume on our network,” says Venkatesh.

BENEFITS Venkatesh mentions that they chose EMC Isilon because it was reasonably priced compared to other solutions in the market. “When it comes to the Silver layer, cost plays a major role. It allows us to store and move the data as well as give the consolidated piece as an interface for employees to collaborate and share information between them. This could be done using SharePoint or some other online portal as well, but those are not cost-effective,” he says. Apart from the low cost, EMC Isilon’s data consolidation capability was another factor that worked in its favor. “Earlier, the data used to be in isolation in datacenters located across India, but now, the EMC Isilon has helped us consolidate these disparate sources and everyone uses the wire to access the internal network which is hosted in Chennai,” Venkatesh says. Another feature is the tremendously scalable EMC Isilon does not need a huge team for datacenter management. “We hardly need two people to manage it, which is pretty good from the system administration point of view,” he adds. EMC Isilon supports Cognizant's internal storage cloud called “My Drive”, which helps employees share content within the company's secured network. My Drive has all the features of other cloud storage tools such as Dropbox and Google Drive. Also, EMC Isilon's multi-node architecture eliminates single point of failure, while Snapshotting functionality helps Cognizant's IT staff with data protection and retention. “No single points of failure and fully journalled file systems with low or no latency at all have made EMC Isilon our preferred storage vendor for our internal cloud storage.” says Venkatesh. Having paved their path to glory by overcoming the complex data challenge at Cognizant, Venkatesh and his IT team are now countering other great obstacles to attain greater glory.

This case study is brought to you by IDG Services in association with EMC

Mike Elgan

FUTURE OF IT

given my context." It ‘feels’ like certain types of information exist in physical places. I'll dig into that idea more, but first let's explore the ‘ambient’ concept.

What Does Ambient Mean, Really? Something is ambient when it is or appears to be part of your environment or surroundings. When you're at a concert, everybody is paying attention to the music—that's not ambient music. But if you're at, say, a cocktail party, the music is usually ambient: You might pay attention to it, you might not. It's there, but it's in the background. In a digital information context, ambience will be brought about by the convergence of multiple trends, including: Mobile notifications. Notifications are about to become far more prominent in our lives. If you look at the notifications as they appear in, say, Google's Android KitKat or Apple's iOS 7, they just keep getting better, more informative and more relevant. Apps will increasingly feed notifications, and these will become increasingly location-based. The combination of constancy and location-awareness will make notifications on smartphones feel ambient, as if they're being harvested out of the air. Wearable computing. As I experienced with Google Glass in the grocery store, notifications and other incoming information will appear to float in the air. This ambient feeling is strengthened by Glass apps that provide contextual data. For example, I walked across an overpass recently, and a short article popped up in Google Glass telling me that the bridge was originally built in 1906 and other bits of information. It felt like that information lives on the bridge, and that Glass is some kind of magic eyewear that can see what's floating in the air there. Preemptive search. Google Now, Siri and other services that are cropping up will seek to answer our questions before we ask them. More importantly, the interface to these virtual assistants will be mostly voice—we'll talk to them, they'll talk to us. Because they'll exist in all our spaces—in our wristwatches, phones, laptops, PCs, cars and homes—we'll have the luxury of not caring which device is delivering the assistant. We'll talk to the air and the air will talk back. It will feel especially ambient when the trigger for these preemptive search services is our location. For example, we'll get in the car, and Google Now will eagerly guess (based on the fact that we're in the car and the time of day) where we're going. We'll walk in the house, and that will trigger reminders we've asked to receive when we get home. As we drive by the dry cleaners, Siri will remind us to pick up our clothes. Virtual assistants will be everywhere and all around us. The Internet of things. Our "things," such as our home appliances, will get microprocessors and Internet connections. Here's a very simple example: Laundry. We put some clothes

in the washer, and the washing machine will know who we are because it will detect identity from the phone. If we leave to run errands during the rinse cycle, the smart washer won't bother notifying us when it's finished because it will know that we're not home. As we walk up the path toward the door, the porch light will come on and the door will unlock—Bluetooth will alert the house that we're home. The lights will come on. The song that was half-played in the car will finish playing in the house. Oh, and the washer will know that we've returned and will remind us to put the clothes in the dryer. Walking into the house will feel like we're walking into a room full of data and intelligence. Location-based commerce. We hear a lot about locationbased advertising and marketing, but this will often be conjoined with location-based purchasing. Combine these, and shopping becomes ambient. For example, today you might spot a pair of sunglasses in a store window and decide to go in and buy them. With location-based commerce, you'll be able to buy sunglasses that you see on someone else's face or in a movie or magazine. The old way to shop was to go to specific locations like malls and look for things to buy. Location-based commerce turns the whole world into a store and puts everything you see up for sale.

Our perceptions about reality itself will change. We'll experience contextual systems as ambient knowledge—walking into a room will feel like we're being immersed in the knowledge that exists in that room.

A P R I L 1 5 , 2 0 1 4 | REAL CIO WORLD

Contextual computing is coming. But it won't feel like context. It will feel like ambience. Think about how touch tablets make you forget that you're using a computer. While swiping through your apps, you forget that this is an information machine with memory and storage and graphics processing. Kids growing up with post-PC devices don't know and don't care how it all works. It's just a magic window to a world of entertainment and information. The same thing will happen with the technologies behind mobile notifications, wearable computing, preemptive search, the Internet of things and location-based commerce. We will forget they exist. Instead, our perceptions about reality itself will change. We'll experience contextual systems as ambient knowledge—walking into a room will feel like we're being immersed in the knowledge that exists in that room. I've seen the future through Google Glass. And it's a future of ambient everything. Change is in the air. CIO

Mike Elgan writes about technology and tech culture. Send feedback on this feature to editor@cio.in

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Al Kuebler

VALUE OF IT

ITMagnetism When the CEO asks the CIO to find a way to attract the business units to the IT function, with the ultimate goal of increasing revenue, the CIO realizes his staff is going to need some new skills.

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he CEO who hired me as CIO to help modernize the IT function of a Fortune 500 enterprise was a visionary. He showed unusual perception about the value of IT. He didn't just want me to fix broken and outdated financial and operational support systems and to eliminate redundant IT spending that was the legacy of multiple acquisitions. He knew that bringing IT up-to-date was both overdue and essential to reduce IT cost, improve service, and favourably position the enterprise for additional IT-based products and services in the future. And he hung in there even as the IT update inevitably took longer than we'd expected. But after three years, IT unit costs were down, customer service had dramatically improved, and business units were becoming interested in using IT's services a bit more to improve their productivity. It was at that point that I saw how visionary the CEO was. Rather than being satisfied with the improvements we had already made in the IT function, he wanted us to build on our better relations with the business units by creating an "attraction strategy." We would need to attract the business units to the IT function by demonstrating to them that we could help them improve both their business and strategic performance. He saw IT as the best investment the enterprise could make in its quest to improve in price/performance year after yearâ&#x20AC;&#x201D;but only if IT was focused on avoiding cost, improving service, and increasing revenue. He was able to erase any doubts in my mind with this impeccable logic: "Won't your IT unit and service cost to business units continue to decrease if the demand for your IT services continues to increase? Won't that make our overall IT asset management program more productive?" It helped too that his last words to me at that meeting were, "Just tell me what you need."

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Riding the Azure Wave Dubbed India’s largest cloud conference, Microsoft Azure Conference 2014 showcased the tremendous transformation that the software giant is powering in India with its advanced cloud platform, Windows Azure. By Shweta Rao

he recently concluded Microsoft Azure Conference 2014 presented Indian IT leaders an opportunity to explore the vast prospects that Windows Azure, Microsoft’s cloud platform, is opening up for enterprises. Being India’s largest cloud conference, the event provided CIOs with a platform to meet partners, share insights among themselves, and discover growth opportunities. While Microsoft’s growth on the global level has been phenomenal, its growth in India has been equally impressive. “India is one of the fastest-growing markets for Azure,” said Karan Bajwa, MD, Microsoft India, in his keynote address. The reasons for this rapid growth are not difficult to deduce either: Easy scalability, cost reduction, agility, and speed of service roll-out are enticing Indian enterprises. Citing a study by Zinnov Consulting, Bajwa pointed out that the hybrid cloud leads the adoption race in India. According to the study, hybrid clouds

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can save 35 to 45 percent in costs, as opposed to private clouds. With this boom in the cloud scene and the large partner and developer ecosystem it enjoys, Microsoft is helping Indian organizations assess and transition to the cloud easily. Also, the Redmond-based IT behemoth has been investing significantly to improve its partners’ and developers’ cloud capabilities. In the last year alone, the company has grown the number of its cloud solution partners by 200 percent, has seen 100 percent growth in the number of independent software vendor (ISV) applications on Windows Azure, and helped 1,700 start-ups adopt Windows Azure. “Our investments in improving the readiness of our partners and developers is enabling faster cloud adoption. We are in a mobilefirst, cloud-first world and cloud is becoming an integral part of the Indian IT infrastructure today,” said Bajwa.

Further, Yousef Khalidi, a distinguished engineer who was a member of the team that built the initial version of Windows Azure, spoke in detail about Microsoft’s vision of the unified platform for modern business. “It’s all about extracting value out of information and giving it to people. We give you choice, we understand you have customers and existing investors. We basically give you a spectrum of technology and the right reasons to make your choices,” he said. In Microsoft Azure’s case, it’s not just the customer base and the demand for cloud, but the whole ecosystem that is growing. “We are gaining 2,000 new commercial customers per month in India for Azure and this is the second year in a row where we see a growth of 200 percent in business in cloud,” Khalidi said. With cloud computing gaining prominence in enterprises’ IT agenda, Microsoft’s Windows Azure, is poised to drive a major transformation in the Indian market.

A Higher Breed

Clout of the Cloud

trategy, budgeting and businessfeedback not withstanding, there’s nothing as effective as learning from experience when it comes to dealing with real-world obstacles in the enterprise space. In an interactive panel discussion at the Microsoft Azure Conference 2014, leading CIOs from four different industries shared insights from their hybrid cloud journeys. The agility to rapidly deliver what business demands is one of the strong reasons for cloud adoption in Indian enteprrises. For Ritu Madbhavi, senior VP-IT at Draft FCB Alka Advertising, the hybrid cloud provides this agility required to meet business demands. “At FCB Alka, business demands have to be fulfilled on an urgent basis. For example, IT was expected to support changes in 900 email domain names within a day when we went through a corporate identity change,” she said. Interestingly, Varun Sood, CIO at Fortis Healthcare, described his cloud journey as disruptive. He has realized his organization’s cloud deployment was transformational in two aspects. “The cloud has changed the perception of IT from being just a support function to being known as a business function. On the other side, we are now able to meet business demands, save capital demands, and redirect remaining budgets back to business,” he said.

Vinod Iyer, co-founder and CEO, iNube Software Solutions, acknowledged that cloud played a vital role in the success of a prestigious government project powered by his organization. iNube supports Rashtriya Swasthya Bima Yojana (RSBY), one of the largest public welfare projects in India which offers a health insurance cover program for BPL (Below Poverty Level) families in India, via its cloud service. “We needed an infrastructure that can manage volume surges and we naturally couldn’t afford a capex model for the solution. A hybrid cloud helped us build a world-class infrastructure for customers which serves the highest level of SLAs that exist,” Iyer said. Commenting on Microsoft’s role in the implementation, he added, “We built the platform with Microsoft and it helped build a bond of trust with the customer. RSBY today hosts about 40 million life claims on the cloud.” With such impressive credentials to its name, cloud computing is sure to make great strides. “Cloud is increasingly becoming one of the viable options that is evaluated for every new hardware refresh and implementation that we consider today, which wasn’t the case two years ago. In fact, we are considering implementing End User Azure Media Services apart from a host of cloud solutions that we are already on,” said Madbhavi.

ndian IT decision-makers are increasingly going for a hybrid cloud approach to complement their on-premises capacity rather than replace it. Pari Natarajan, CEO of Zinnov Consulting, presented a brief on the drivers of hybrid cloud adoption. According to Natarajan, the Indian market presents a solid foundation for cloud uptake. “One of the key reasons for cloud adoption in India is that it has strong ecosystem drivers in the form of 500 large enterprises and 10 million IT-ready SMBs,” he said. The slew of benefits that the hybrid cloud offers explains organizations’ enthusiasm to adopt the technology increasingly. About 78 percent Indian CIOs have witnessed reduction in TCO for infra-related spend due to the hybrid cloud. “Forty percent Indian CIOs have expressed readiness to implement hybrid solution in our cloud survey. And more than half of them feel that choosing the best cloud providers and ensuring integration are the most critical aspects to ensure success of the deployment,” Natarajan said. However, certain constraints currently keep IT decision-makers wary of hybrid deployments. “Need for increased management efficiency and skills required to handle the complexity of managing multiple vendors are some of the key barriers to hybrid deployments,” said Natarajan. He recommended CIOs to leverage one-stop-shop vendors for successful hybrid deployments. “CIOs need to attach hybrid cloud strategy to business growth and not just cost savings to truly maximize their cloud ROI,” he said.

IDG SERVICES

Al Kuebler

VALUE OF IT

BRM from Scratch This all happened several years ago. Nowadays, of course, a CIO who was told to create an attraction strategy would be able to find all sorts of information about business relationship management (BRM). Back then, though, we had to start from scratch. But I think our experience of finding our way with so little guidance available holds valuable lessons still. Not surprisingly, when I met with my direct reports to discuss the challenge the CEO had issued, we managed to see all kinds of snags: We weren't set up to operate like a business, we didn't have marketing or special communications resources, our staff was purpose-built around technical capabilities, we weren't deeply involved in our clients' businesses, and so on. But a direct appeal from the CEO can't be simply shunted aside, so we kept meeting to talk about it. For a while, we just couldn't get past the difficulties that we had identified, but then someone on the team was able to turn us around by noting that knowing all of the weaknesses we were bringing to this task was actually a strength. Because we had identified them so well, we should be able to figure out what we needed to do and what resources we would require to remedy each one. We also came to accept the following as the core principle underlying our undertaking: If the IT function was going to attract more demand, then everyone in it needed to view our business units as real customers who had a choice regarding where they obtained IT services. And if we were not directly focused on quality performance and meeting our customers' expectations, we would have no basis at all for them to seek additional IT services or assistance.

that is always current, accessible, and readily apparent. Sixth, identify opportunities for the continuous improvement of IT service quality, needed adjustments to existing IT services, and all-new IT services as they become needed, and jointly assess options to provide those services. And finally, periodically give updates to business units regarding the advantages, features, and benefits of existing IT services and any emerging technologies, tools, or techniques that might benefit them. In other words, if we were to create demand, we needed to add to our IT staff people who could be marketers, two-way communicators, voices of the customer, involved partners, trusted account managers, and advocates for shared services, all rolled up in one. These new people would be the foundation of a new IT function, which we wound up calling the Business Systems Group (BSG). But the entire IT staff, bolstered by some consultative training, would play a part. Built around basic client relationship management (CRM) principles, the BSG could be the impetus, we felt, to move the IT organization toward a commercialized culture. But how would we know if we had achieved that objective? We were aware that the CEO would want us to be able to tell him

If the IT function was going to attract more demand, then everyone in it needed to view our business units as real customers who had a choice regarding where they obtained IT services.

how we could be sure that our attraction strategy was working and whether or not this new BSG resource was accomplishing its mission.

New Skills

What is Success?

A proposal began to take shape. We saw that we could easily scale our "plan, build and run" services to accommodate growth in demand, but it was clear that we would need significant additional resources for a new kind of client relationship management function with a different skill set than the rest of the IT function. The new skills we were in need of were ones that could: Ensure that the services IT provided remained responsive to the needs of every business unit it serves. Second, become active contributors to performance-improvement initiatives in the business units, and be jointly accountable for the results. Third, build a strategy to advance the priorities of both business units and IT and thereby manage mutual expectations. Fourth, facilitate the provisioning of IT services, and ensure all services remain the best means to meet business partners' needs as situations change. Fifth, provide all business unit staff with a directory to IT services

One part of the question of how to measure success turned out to have a simple answer, once we returned to the CEO's original request. We realized that our attraction strategy (by now we were starting to like the term) would be working if demand for our services grew, and especially if that growth was primarily in IT's plan and build activities (in view of the CEO's emphasis on new uses of IT for improving business and strategic performance). But measuring the BSG's success in achieving the mission we'd set for it was harder. In the end, we came up with what we considered a pretty good guess. We would quantify the BSG function's effectiveness by measuring: • The useful knowledge it has (from a marketing viewpoint) about the business units its IT function serves. • How the IT function is perceived by business units. • How much the demand increases for IT services. • The extent to which the IT function objectively introduces

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Al Kuebler

VALUE OF IT

beneficial change throughout the business units it serves and the entire enterprise.

Expanding Our Skills Case closed? Not really. Before approving the investment needed for the BSG (what these days we would call the BRM function), the CEO made the point that we would need to work especially hard to find the right talent and then make sure that the new skill set held by those people remained current. If we didn't, he cautioned, our new function could be seen as an additional layer of IT cost and even bureaucracy. He was right, as usual. As it turned out, though, over half of the BSG unit was staffed from the ranks of the existing IT team. Because those staffers needed to be proficient in interpersonal communications, they were trained in consultative skills, and the entire BSG team had to be kept up to date on critical CRM practices (all we had at the time). Even better news was that our benchmarking processes and business unit assessments made it clear that our services were priced below the alternatives and that our approach to providing them responsively was considered anything but bureaucratic.

involved with the business units. At first, the BSG introduced a few small changes to business processes and built a few new (non-administrative) applications. Over the next four years, however, proportionally more IT initiatives were built to improve service and increase revenue (not just to avoid cost), and demand began to rise at a slightly higher rate. Real success came when the BSG, by virtue of its involvement with the business units, realized the power of the Internet in making our existing printed information product lines also available for sale in digital form there (I told you this was many years ago!). That initiative alone brought in significant new revenue at very little additional cost. The CEO was so pleased; the results of his IT attraction strategy became a key theme within the company's annual report to stockholders. As the CIO, I was most pleased with the increased sense of pride among the IT team as they came to understand more directly how what they did benefited both their clients and the enterprise. And they thoroughly enjoyed the chance to be creative as part of their charge to introduce beneficial change. CIO

Al Kuebler was CIO for AT&T Universal Card, Los Angeles County, Alcatel and

A Happy CEO

McGraw-Hill. He is the author of the book Technical Impact: Making Your Information

In the BSG's first year, demand for IT's services grew only at the same rate as before, as the BSG team became increasingly

Technology Effective, and Keeping It That Way, from which this article was adapted. Send feedback on this column to editor@cio.in

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Agility, performance, and reliability are of significance to today’s dynamic business environment. Here’s the story of how Eagle Home Appliances and Eiffel Group successfully fulfilled these needs with AllTimeIT Solutions and HP CloudSystem. By Gunjan Trivedi

or decades, IT followed a componentfocused model, integrating an evergrowing number of elements into the datacenter, including hardware, storage, networking, and applications. This drove down component costs, but put the burden of integration on IT. Now, cloud computing has emerged strongly, empowering users with automated

self-service access to a range of services. To fully capitalize on the cloud, IT needs to change the way it operates—transitioning to a new model that delivers IT as a service. The cloud promises big things: Improved innovation ability, increased agility, and reduced costs. But to realize these important benefits, you need to deploy the right cloud platform from the right vendor.

The huge expanse of the cloud technology playing field and the number of contenders— both large and small—might boggle your mind with regard to which service you should choose. But you can rely on HP to put you on the right path and make your business surge ahead with its CloudSystem solutions. Just like how Eagle Home Appliances leveraged AllTimeIT Solutions’ EffiCloud, a cloud

CUSTOM FEATURE HP service built upon the HP CloudSystem platform, to chart its route to success by hosting its ERP on the cloud, improving internal business processes, and providing better customer service. In a similar fashion, Eiffel Group, a realestate organization, also outsourced its applications to the EffiCloud, powered by HP CloudSystem, and significantly reduced the cost and management burden of running business-critical systems. Here’s how the organizations did it.

and it is currently supporting 40 concurrent SAP users. It is estimated that going for the cloud option saved Eagle up to £5,000 (about Rs 5 lakh) in set-up costs and EffiCloud is delivering 99.999 per cent availability, at the speed of service that Eagle needs. “Orders that previously took four or five days to be put into our systems can now be seen in five minutes,” says Dutta.

CORE ON CLOUD Based in Pune, Eagle Home Appliances is a leader in the home appliance market. To support business efficiency and offer good customer service, it decided to implement SAP ERP. However, integrating a wide variety of commercial functions calls for complex and sophisticated systems, which, in turn, put pressure on a company’s IT infrastructure and staff. Moreover, having recently launched a new travel and tourism arm, Eagle is constantly growing and found that its legacy ERP system could no longer provide the necessary level of support. “We used an ERP system that was just restricted to accounts and a lot of our processes were not covered by it. So, the company decided to change to SAP,” explains Swapan Dutta, head of Eagle’s Electronic Data Processing (EDP) Department. “Our aim was to connect the entire company to SAP with data stored in a central location. Previously, everything was manual and that was affecting our delivery schedules. In our business, delivery dates are very important,” he says. Since it only has a small IT team and virtually no infrastructure, Eagle decided that the best route, particularly in the early implementation phase, was to outsource the SAP application to a cloud services provider that could promise high availability with low latency and lower TCO. After a thorough evaluation of the options available, Eagle decided to carry out the deployment with AllTimeIT Solutions, a consortium of 15 leading Indian IT infrastructure service providers who recently partnered with HP to create the EffiCloud. AllTimeIT met one of Eagle’s first aims by providing the EffiCloud service at a day’s notice

“The performance and delivery of service of effiCloud and AllTimeIT have been very good and we have not had any problems with either availability or latency.”

-Thiru Moorthy, Head-IT, Eiffel Group

Managed in-house, the ERP system was experiencing problems related to availability and performance of critical applications. Moreover, manageability issues began to crop up as well. Hence, when it needed to refresh its server estate, the organization was attracted by the capex and opex savings offered by pay-per-use outsourcing. “We decided to outsource to a cloud service provider that promises to have the agility to scale server capacity up and down as required and have no constraints on bandwidth,” says Thiru Moorthy, head of IT, Eiffel Group. Therefore, to reduce costs, ease management, and increase availability, the company decided to outsource its critical SAP and CRM solutions to EffiCloud. Outsourcing has saved Eiffel Group a substantial amount of money on the cost of buying and maintaining infrastructure, and AllTimeIT’s pay-as-you-go model is also emerging to be commercially attractive with lower administration and more predictable budgeting. Making crucial SAP and CRM systems readily available has increased staff efficiency and productivity and, in turn, improved Eiffel Group’s services to its customers, suppliers, and business partners. “The performance and delivery of the service is very good and we have not had any problems with either availability or latency,” says Moorthy.

CONFIDENCE ACCELERATED

SERVICING BENEFITS Agile and reliable business systems are essential for all enterprises, but they are particularly vital for fast-moving, ambitious companies in order to support their rapid growth. With a mission ‘to build 100 new cities by 2030’, Indian housing venture XRBIA certainly fits that description. XRBIA is run by the Eiffel Group, which currently has building projects in Mumbai, Nagpur, Delhi, and its home city of Pune. A few years ago, Eiffel Group decided to streamline its business efficiency by implementing the ERP business platform SAP R/3 and the Sugar UX CRM system.

It’s pretty clear that once you decide to move to cloud, you want to put the process in motion immediately—and you can do it with HP CloudSystem. Begin with any type of cloud services—from basic infrastructure services to advanced application services— and grow seamlessly at your own pace.

This case study is brought to you by IDG Services in association with HP

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SDx

For the first time, the number of Indian CIOs pointing their enterprises towards a hybrid cloud model is equal to those focusing on private cloud. What gives? By Shubhra Rishi

Arthur Clarke once said, “Trying to predict the future is a discouraging and hazardous occupation.” Yet, that’s exactly what he did when he predicted the iPad in 1968 (he called it the ‘Newspad’). He wasn’t the only one. Isaac Asimov predicted online education, and Douglas Adams predicted e-books. All of them wrote science fiction. You don’t have to be a Clarke, an Asimov or an Adams to predict where cloud computing is headed in the short term. It isn’t the public cloud or the private cloud—but an amalgamation of both. Research from CIO India reveals that 42 percent of Indian CIOs are choosing a hybrid cloud strategy, when asked to select a cloud model their organizations are likely to implement in 2014. At the start of 2013, that number was 38 percent. But, here’s what’s more interesting: As far as the hybrid cloud is concerned vis-à-vis the private cloud, we’ve reached a tipping point. For the first time, the number of Indian CIOs planning for hybrid clouds is equal to those planning for private clouds. Until the middle of 2013, a majority of Indian CIOs (51 percent) were Reader ROI: pointing their organizations towards a private cloud strategy—and 35 percent to a hybrid cloud. Today, they are equally divided with 42 How more Indian companies are turning to hybrid clouds percent on both sides. Why they are doing that This sudden spike of interest in hybrid clouds is a recent phenomenon. In the middle of 2013, over half of Indian CIOs said hybrid clouds weren’t

even on their technology roadmap. Then six months later, 46 percent say they are either implementing a hybrid cloud or are planning to deploy one within a year. What gives?

Lined with Silver Sterlite Technologies is exactly the sort of place you’d expect to see a hybrid cloud. Headquartered in a posh Pune locality, a 10-minute walk from the Osho International Meditation Resort, the Rs 3,300 crore Sterlite Technologies, manufactures telecom and power infrastructure. And it’s very IT savvy. Four years ago, like many companies in India facing economic headwinds, Sterlite Technologies needed new ways to create a leaner, more efficient version of itself. And the public cloud was going to play a big role. “We realized that changing business dynamics required us to adopt a robust cloud strategy to help us reduce capex costs and eliminate the needless manageability of certain IT systems,” says Prasanth Puliakottu, CIO, Sterlite Technologies. Puliakottu isn’t alone. According to CIO research, 35 percent of Indian CIOs believe that public cloud offerings can help them convert capital expenditure into operating expense. And 44 percent believe it helps lower their total cost of ownership. Puliakottu and his team started pushing chunks of the company’s operations to public platforms. Today, its e-mail, sales and CRM applications, project management, and videoconferencing rest in the public cloud while its payroll, HRMIS, workflows and approvals operate from its private cloud. The company has integrated its e-mail with its internal ERP to streamline project workflows. Sterlite Technologies made the move four years ago, at a time when many CIOs were reluctant to dabble in technology platforms they had little control over. Today, however, that’s changed. “CIOs were very apprehensive about the side effects of the cloud but now the technology

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Prasanth Puliakottu, CIO, Sterlite Technologies, helped make his company more efficient using a hybrid cloud strategy.

has reached a level of commodization, and the mass adoption of the hybrid cloud is likely to happen,” says Rajesh Uppal, executive officerIT and CIO at Maruti Suzuki. For the Rs 44,376-crore Maruti Suzuki, its initiation to the cloud started as early as 2005 when it built a private cloud for its dealers, distributors and service stations for a nominal fee. Today, over 30,000 dealers, distributors and service stations, in over 3,000 locations, use its private cloud. The experience of hosting a cloud internally, says Uppal, was a great learning experience for the automobile manufacturer and helped it recognize the pros and cons of managing inhouse infrastructure at an early stage. In the next phase of its cloud strategy, Maruti Suzuki decided to move about 35 customer-facing applications—including

user websites and insurance applications—to a public cloud platform. Infrastructure costs, security concerns and manageability of resources were the three main drivers that strengthened the auto manufacturer’s decision to adopt a hybrid strategy. “We decided that we wanted to use more of our IT budget for innovation instead of spending it on running legacy infrastructure,” says Uppal. The move took only three weeks, says Uppal. Today, his team has fewer worries around the manageability and availability of customer facing apps. Before commencing on a hybrid cloud journey, Uppal advises CIOs to compare the performance of their on-premise apps and map them against the benefits of a public cloud. There, he says, they will find a business case for a hybrid cloud. REAL CIO WORLD | A P R I L 1 5 , 2 0 1 4

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“In the last eight years, the cloud has reached a level of maturity. It now makes business sense for us to utilize both private and public clouds to manage our internal and external customers,” says Uppal. At Sterlite Technologies, Puliakottu too, has seen monetary benefits from using a hybrid cloud. “Our hybrid cloud strategy has been quite profitable for us. We have been able to lower our costs by 30 percent,” he says. And rather than being pigeonholed into choosing one technology solution over another, the hybrid cloud, says Puliakottu, allows Sterlite Technologies to acquire the expertise of multiple technology partners. According to Puliakottu, managing multiple clouds from multiple vendors

and ensuring internal applications could be integrated into a hybrid service was no mean feat. “The most crucial aspect of leveraging a hybrid model is to coordinate between different vendors managing your applications,” says Puliakottu. Recently, in a first of its kind initiative, Puliakottu organized a meeting between the company’s C-suite and eight of its key IT vendors, who he prefers referring to as partners. The objective was to enhance transparency and increase collaboration between the two groups.

Light as a Cloud About five kilometers to the north-east of Sterlite Technologies, another Puneheadquartered company has already

Rajesh Uppal, Exec Officer-IT and CIO at Maruti Suzuki, believes that “the mass adoption of the hybrid cloud is likely to happen.”

discovered the first-hand benefits of using a hybrid cloud model. The hybrid cloud has done wonders for Bajaj Finance, a company with Rs 22,461 crore of assets under management. In 2008, the company which successfully ran a captive two-wheeler financing business, decided to expand its portfolio to become among the most diversified non-bank in the country. Today, it provides for 11 product lines across consumer, SME and commercial lines of businesses. It’s a transition that would have been less successful without a hybrid cloud strategy. “Our cloud journey began five years ago when the industry was still evaluating the pros and cons of a cloud strategy. However, our business model required an anytime, anywhere technology solution to on-board the vast number of consumers we were acquiring in our consumer durables business” says Rakesh Bhatt, COO, Bajaj Finance. “We realized that cloud solutions could help us scale operations quickly and gain business agility,” says Anurag Chottani, CIO, Bajaj Finance. According to many other Indian CIOs (53 percent) an increase in business agility is the most important benefit of leveraging the public cloud. Chottani says that by using a cloudbased sales CRM, Bajaj Finance’s approval turnaround time for its consumer durable business improved from three days to three hours to three minutes resulting in more processing capacity and improved customer experience. “Today, our cloudbased platforms enable us to acquire 2.4 million customers in a year across 4500plus retail chain outlets across India. This initial success led to the creation of a hybrid cloud strategy, which suited the business model much better,” he says. Today, Bajaj Finance leverages softwareas-a-service (SaaS) and platform-as-aservice (PaaS) offerings. “SaaS provides us opportunity to use and deploy off-the-shelf objects related to sales and service CRM framework,” says Chottani. “PaaS is used to build custom applications for complex business products like home loans and business loans,” he says, “Moreover, this strategy matches to the cyclical nature of our consumer business, which allows flexibility in managing our compute infrastructure.”

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Cover Story Apart from using the cloud for business applications, Bajaj Finance also made a huge foray into a cloud-based messaging solution and collaboration tool for the enterprise. “The best part about this is that we face zero downtime and there is no infrastructure management activities,” says Chottani. Chottani says that the main challenge with a cloud strategy is the integration of multiple solutions on the cloud and inpremise. Bajaj Finance has addressed this challenge by implementing middleware, which provides for real-time data exchange between cloud and in-premise solutions. For Bajaj Finance, the hybrid cloud has changed the company’s business dynamics radically. Sales CRM enables revenue benefits, service CRM enables high customer retention,and mail and collaboration solutions enable employee productivity. “This is an example of true cloud orchestration, a mix of in-premise, hosted, SaaS and PaaS solutions working in harmony to deliver the desired business process,” says Chottani. “Today, our hybrid cloud strategy enables the creation of a differentiated and profitable business model with focus on cross-selling, customer experience along with product and process innovation. This strategy delivers huge operating leverage for the company,” says Bhatt.

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Anurag Chottani (L), Chief-IT, and Rakesh Bhatt (R), COO, Bajaj Finance, used a hybrid cloud model to help the company expand its portfolio of services.

Simplifying the Datacenter Another reason, Indian CIOs are turning to the hybrid cloud is to reduce the stress on their datacenters. According to CIO India research, IT leaders say that the growth of server virtualization is one of the top factors increasing datacenter complexity. At some Indian organizations there’s the realization that server virtualization is actually increasing infrastructure costs. Server virtualization, goes the reasoning, packs a lot of applications onto a single machine, making it a single point of failure. As a result, few CIOs want to risk extending the life of their virtualized servers and having them fail—so they are calling for more frequent hardware refreshes. Datacenter complexity is also on the rise due to increases in both data volume and in the number of business-critical applications. 36

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These factors, say a quarter of Indian CIOs, have led to higher costs. That’s a terrible thing, especially because inadequate budgets is the third highest factor leading to datacenter complexity. A hybrid cloud strategy, one in which, some applications are pushed to public cloud, promises to alleviate some of that complexity. A hardware refresh is what triggered a hybrid cloud strategy for Ritu Madbhavi, senior VP-IT at Draft FCB Ulka Advertising. That isn’t unusual. “CIOs have almost always been influenced by technology refresh cycles in order to consider cloud as a viable option,” says Biswajeet Mahapatra, research director at Gartner. The firm commenced its cloud journey in 2011 when it decided to invest in an external cloud-based storage solution.

The company’s existing legacy storage was going out of support and Madbhavi didn’t want to invest in traditional storage and servers for data recovery and backup, and was therefore, looking at the cloud as a possibility. The company had already treaded the path of owning a datacenter and undergoing almost 100 percent server virtualization in the past. For two months, Madbhavi weighed her options and finally chose a cloudbased storage solution which provided the firm with primary storage, and backup and disaster recovery for an on-premise datacenter. It gave the company the flexibility to conduct DR on the cloud and saved immensely on capex costs. As per an Acronis Global Disaster Recovery Index report on BRIC nations,

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the top three benefits of using the cloud for backup and disaster recovery include lower IT operating costs, additional or flexible storage space, and improved compliance— all of which were true for the company. Testing the waters of a hybrid cloud storage has proved to be successful for the company because it freed up capital—but, perhaps more importantly, it gave it the confidence to do more with a hybrid model. “Our SAN storage costs have reduced by 40 percent,” says Madbhavi. For the company, the hybrid cloud journey has begun and Madbhavi is already in the process of moving the company’s development servers to the cloud. “Going forward, we will be making considerable cloud investments in the near future,” she says.

CIO research indicates that about 40 percent of Indian CIOs will move less critical IT systems to cloud services. That’s because they see the benefits of moving to a hybrid cloud environment. CIOs believe that the best of both worlds can help their IT organizations meet the growing demands of businesses to maximize efficiency, increase business agility, and improve manageability of resources within organizations. CIO research also indicates that Indian IT leaders also realize that hybrid clouds will overcome the hurdles of private cloud by lowering their cost of operations and enabling faster provisioning. This makes a reasonably strong case for the hybrid cloud and indicates

Ritu Madbhavi, SVP-IT, Draft FCB Ulka Advertising, lowered SAN storage costs by 40 percent, thanks to a hybrid cloud strategy.

a growing acceptance among CIOs to reposition their cloud strategy—from purely private to hybrid. That said, not everyone believes in the hybrid phenomenon. Some analysts believe that what’s currently being called hybrid cloud models, aren’t really examples of the hybrid cloud. True hybrid clouds should allow enterprises to lean on their public clouds during stretch periods, and vice-versa, some some analysts. Or what they call cloud bursting. “Hybrid clouds are still a lot of science fiction,” says Mahapatra. “That’s because IT organizations haven’t yet reached a level of cloud maturity for them to adopt a hybrid model,” he says. Whatever the definition of hybrid you follow, one thing is for sure: With every passing day, the environment is becoming more conducive for hybrid cloud models to build up. Some of the key ingredients of this environment include the lowering costs of bandwidth and an increase in hybrid cloud success stories. “Everyone was waiting for a few success stories to come up,” says Debdas Sen, executive director, PwC India. Another important factor is the changing perception of the public cloud’s security. “Both in reality and in perception, the insecurities around the public cloud have been taken care of. CIOs have realized that it’s now fairly safe for their businesses and workflow applications to reside somewhere else, in a multi-tenant environment,” says Sen. In fact, according to CIO research, 54 percent of Indian CIOs believe that the risk or working with cloud providers is about the same or lower than the risks of working with traditional outsourcers. According to Gartner, nearly half of all enterprises will have hybrid cloud deployments by the end of 2017. “The strength of the cloud lies in a hybrid model,” says Mahapatra. The hybrid cloud is the future. In the words of Douglas Adams, “Let the past hold on to itself and let the present move forward into the future.” Buckle up. CIO Shubhra Rishi is senior correspondent. Send feedback on this feature to shubhra_rishi@idgindia.com

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DIRECTION

Are you Dynamic? 4 - 5 September, 2014 | JW Marriott, Pune

Nominations open!

write to rupesh_sreedharan@idgindia.com

CIO Career

The battle between CIOs and CMOs is well-known, but how different are the two, really? To find out, we turned to the Myers-Briggs personality type test for a detailed breakdown of their traits and tendencies.

BRIDGE

C I O CMO DIVIDE

THE

B y To m K a n e s h i g e

Tired of waiting for lengthy approval processes, CMOs have been doing end-runs around the IT department for years. In turn, scorned CIOs would rip out the marketing department’s rogue tech. CMOs responded in kind by running to their buddy in the corner office — the CMO and CEO are often cut from the same personality cloth — and complain that those techies are at it again, slowing down business decisions they don’t understand and letting competitors beat them to the punch. “I can tell you horror stories,” says Kevin Reader ROI: Why they CIO and Cochrane, a tech industry veteran who has held CMO clash top marketing positions since the mid-1990s and How to fix it is currently CMO at OpenText, an enterprise Finding common ground information management software company.

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CIO Career

For years, the CIO and CMO have faced off in one of the rockiest executive relationships. As the two odd stepchildren in the C-level suite, they constantly must prove their worth, which often pits them against each other as they try to curry favor among their peers. Both need new technology to be successful and they must compete for scarce dollars. Making matters worse, their jobs tend to reward opposite personality traits; clashes can get ugly.

Frenemies of the Corporate World Now, in the age of the digital customer, the CIO and CMO must work together closer than ever. Given the antagonistic history between these two executives, it sounds like an impossible situation. At times, the CIO and CMO appear to be playing a zero-sum game. That is, one does well o nly at the expense of the other. During the financial crisis, for instance, the CIO was a highly valued cost-efficiency expert who kept the company running by delivering concrete returns on investment. The CMO, on the other hand, was a “black magic” brand enhancer who wasted precious dollars in advertising campaigns with no clear return on investment. The CMO almost didn’t survive and had to turn to technology to get closer to the revenue pipeline. Today, as the economy recovers and competition heats up, the roles have reversed. The CMO’s ability to show real sales flowing from technology investments in social, mobile and data analytics puts him in a prestigious position. Meanwhile, the

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CIO’s operational role means he no longer sits at the strategic table; his C-level status is under assault. Underscoring this power shift, Gartner predicts CMOs will spend more on technology than CIOs by 2017. In truth, CMOs and CIOs need each other to reach the digital customer and achieve the holy grail of marketing. “The only way marketing can get a holistic view of who is the customer, what they’ve done, and what they’re most likely [to do] is by partnering with IT for true multi-channel customer analytics,” Cochrane says. But how are they going to work together?

Are CIOs and CMOs Really That Different? For CIOs and CMOs to work well together, perhaps the first step is to understand how the other side thinks. It will also help if these C-level executives look inside themselves. One of the foundational ideas behind the Myers-Briggs personality system is to help individuals better understand their own personality tendencies and potential differences with coworkers and, ultimately, find common ground. The 16 personality types in the Myers-Briggs system are not stereotypes nor written in stone, rather they are merely natural inclinations toward particular preferences. That said, many CIOs fall into Myers-Briggs defines as personality type ESTJ: Practical, realistic, matter-offact. Decisive, quickly move to implement decisions. Organize projects and people to get things done, focus on getting results in the most efficient way possible. Take care of

routine details. Have a clear set of logical standards, systematically follow them and want others to also. Forceful in implementing their plans. CMOs tend to have the personality Myers-Briggs classifies as ENTJ: Frank, decisive, assume leadership readily. Quickly see illogical and inefficient procedures and policies, develop and implement

Then there are the opposing letters in the personality acronyms. For the CIO, there is the S, which stands for sensing. For the CMO, there is the N, which stands for intuition. “Sensing relies more on taking historical significance into account versus intuition, which may be following a hunch,” Haynie says. In the practical world, this difference can translate into

For years, the CIO and CMO have faced off in one of the rockiest executive relationships. As the two stepchildren in the C-level, they must prove their worth, often pitting them against each other as they curry favor among their peers. comprehensive systems to solve organizational problems. Enjoy long-term planning and goal setting. Usually well informed, well read, enjoy expanding their knowledge and passing it on to others. Forceful in presenting their ideas. Sherrie Haynie, organizational development consultant at CPP, publisher of the Myers-Briggs Type Indicator, is quick to point out that the CMO and CIO share more similarities than differences, which makes sense given that both hold executive leadership positions. Common ground includes a need to be decisive and efficient and, perhaps most relevant, the ability to solve problems.

variations in the perception of speed and willingness to fail, says Cochrane. When a CMO sees a change in consumer behavior or the competitive landscape, he wants to react very quickly. Marketers often come up with creative ideas on a gut feeling, and the CMO throws some money at it, assigns a couple of marketing people for a few weeks, launches, fails fast, and moves on to the next thing. CIOs are more diligent and need to think through a project proposal from start to finish. Continued on page 45.....

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NEXT LEVEL OF DATACENTER SERVICES Netmagic’s and NTT Communications’ new datacenter promises to bring world-class services to enterprises within the country. It is also a formidable addition to NTT Communications’ Nexcenter range of services. By Shweta Rao

etmagic, an NTT Communications Company and India’s only Datacenter Infrastructure Lifecycle Management (DILM) service provider, recently launched a datacenter in Bangalore on the 27th of March. Located at Electronic City, this 110,000 sq. ft. datacenter—part of the Nexcenter range of datacenter services by NTT Communications— is the first ever collaboration of Netmagic and NTT Communications in building an entire facility from the ground up. Akira Arima, president and CEO, NTT Communications, and Sharad Sanghi, MD and CEO, Netmagic, along with top executives from NTT Communications and Netmagic unveiled the new Netmagic datacenter. “This is a moment of pride for us, as this new datacenter will give Indian and global enterprises the opportunity to experience the state-of-the-art datacenters that NTT Communications operates across the world. The added advantage of Netmagic’s excellence in IT infrastructure management and service

delivery in the Indian enterprise space gives this datacenter the capability of becoming the benchmark for datacenters in India,” said Arima. The datacenter unveiling was followed by a guided tour of the facility to a select few delegates. CIOs present at the venue learnt in detail about the datacenter’s capabilities to deliver the entire range of Netmagic services including managed co-location, dedicated hosting, IT infrastructure monitoring and management, security, DR, and cloud computing. The datacenter will also act as a perfect place for large organizations both within and outside India to establish their disaster recovery and business continuity sites. The datacenter, aimed at large IT/ITeS companies looking for scalable and highquality datacenter space, adds to the growing number of NTT Communications’ world-class datacenters globally. Sanghi said that Bangalore offers a strong growth potential and a supply constrained market, making it the most opportune moment

for NTT Communications and Netmagic to launch the new datacenter. “Given the large concentration of data-intensive activities in Bangalore, our objective is to accommodate enterprises’ demand to house their critical IT infrastructure closer to them, as well as ensure that our datacenters have the scalability to meet their growing needs,” he said. It also offers co-location space with high power and cooling densities. The new facility offers not only individual racks, but also highly secure cages and enclosed server rooms to clients. As with all of the company’s datacenters, connectivity from multiple telecom providers will be available through physically redundant paths, allowing customers to architect on any network of their choice. The design of the facility lays stringent focus on security, both physical and logical. The new datacenter also boasts of being one of the facilities least prone to natural calamities and promises its customers ready access to key resources.

BUILDING THE DATACENTER OF THE FUTURE Sharad Sanghi, MD and CEO at Netmagic, speaks about the company’s new datacenter built in collaboration with NTT Communications, and what Indian enterprises stand to benefit from it. What role can NTT-Netmagic play in articulating a direct link between a responsive IT ecosystem and an increase in efficiency? Over the years, as systems and processes across organizations have matured, the underlying technology has gained precedence. In such a fast paced environment, the IT ecosystem needs to be more flexible, more scalable and faster performing than ever before. As technology deployments mature, the link between a responsive IT ecosystem and an organization’s efficiency will only grow stronger. In that light, such an articulation is something every CIO must face as they secure the budgets needed for their planned investments. But modern enterprises understand the importance of having a responsive IT ecosystem. This entire IT ecosystem needs to be supported by an infrastructure that can evolve to keep up with the needs of a growing enterprise, and that’s where Netmagic and NTT Communications come in with the Nexcenter range of services. As India’s only Datacenter Infrastructure Lifecycle Management Company, Netmagic has been partnering with enterprises at every stage of their IT infrastructure lifecycle. As part of NTT Communications’ Global Cloud Vision we’re positioned to offer seamless global connectivity and infrastructure solutions that are globally benchmarked. This covers all benefits that they can take advantage of when they move from an in-house setup to a third-party managed setup. In a nutshell, the Netmagic – NTT Communications together bring both global expertise and local know-how of helping organizations across the world formulate their next step in the IT evolution journey.

How do you see Indian customer expectations shaping up and markets reacting to new-age IT delivery models? The Indian customer is far more demanding, technologically mature and acknowledges the need to optimise disparate IT setup(s) in his/her enterprise. Over the years, we have witnessed a progressive shift from optimising the platform to the application layers and now, the IT Infrastructure layer. The change is a positive one and is constantly moving towards adoption of new-age IT delivery models. More importantly, enterprises are looking for a hybrid model that allows them to build upon their existing infrastructure. In fact, it’s seeing good traction within the BFSI, Media & Entertainment and E-commerce verticals, with most of them evaluating it for setting up their DR sites. What’s making this an attractive investment is the pay-per-use aspect which insulates them from the commitment of heavy capex. What governs the adoption of these new IT delivery models? How can NTTNetmagic help? Adoption of these models comes down to delivering operational efficiency, application compatibility, flexibility in hosting models and cost-effectiveness. And, the NTT Communications and Netmagic combine assists enterprises in doing just that. Having pioneered Cloud computing in India, we’ve always been sensitive to an enterprise’s expectation from this solution. Some of our existing customers like Dish TV, Star India, Hungama are live on a Hybrid model and we’ve been helping them deliver on the previously mentioned aspects. What can enterprises gain from the combined engineering excellence and

SHARAD SANGHI, MD and CEO, Netmagic

operational expertise of NTT Communications and Netmagic at the new datacenter? What makes the Netmagic and NTT Communications combination potent is a deep understanding of the unique needs of Indian enterprises that can now be addressed with the technological expertise that’s behind the no. 1 telecom company in the world. This combination will bring onto the table, the experience and expertise in catering to the varied needs of industries across India and across the globe, each with its own set of custom deployments. Besides this, the customer stands to benefit from the highest uptime in the industry, and consistent with Netmagic’s datacenter standards, connectivity from multiple telecom providers will be available from physically redundant paths allowing customers to architect on any network of their choice. Enterprises can also expect further attention to detail with amenities, such as a highly secure material handling system, based on bar coding and multiple checkpoints, adequate customer office space, dedicated storage space and heavy equipment handling systems. Netmagic and NTT together provide an entire suite of IT Infrastructure outsourcing services, and not just basic colocation services. We provide efficient delivery at every stage of IT infrastructure Lifecycle and at every iteration.

CIO Career .....Continued from page 41

More resources will be at stake, perhaps tens of thousands of dollars. The CIO must commit servers and developers for a month or more. “If you fail, you don’t just walk away,” OpenText’s Cochrane says. “You iterate, iterate, iterate until it works.” Forrester Research puts the onus on the CIO to respond faster to business needs. Additionally, Forrester advises companies to “create formal, hybrid-skills groups, or digital centers of excellence, which draw on skills and expertise from IT, application development, digital strategy, digital marketing, communications, customer support, and even project management

Can’t They Just Get Along? Cochrane says he believes the IT-business relationship boils down to the CIO and CMO and their ability to work together. In order to maintain a healthy relationship, Cochrane meets with the CIO every week. They sit in on each other’s staff meetings once a month, with Cochrane explaining the thinking behind marketing’s outlandish requests to the IT staff, and the CIO telling the marketing staff why some requests are taking long to fulfill. The CIO and CMO also travel to technology and marketing conferences together. They listen to and participate in the same discussions. They want to learn about the other’s craft and gain insight into their different perspectives. They want to build a level of familiarity and trust. They want to help each other. In other words, they work hard at the relationship. Still, problems arise. 45

5 WAYS TO GET ALONG WITH CMOs “The age of the customer,” points out a new report by Forrester Research, “places new demands on organizations, requiring changes to how they develop, market, sell and deliver products and service. But the report adds that, “IT and business teams frequently inhibit successful digital experience execution by failing to work cooperatively.” To help get past this challenge, Forrester offers five ways IT and business can work together and avoid such scenarios: For starters, CIOs must widen their agenda from internal operations to include business technology—that is, technology that touches the company’s customer. This means coming up with innovative ways to work more closely with the business side than ever before. Farm Credit Services of America, for instance, created a building with open areas and breakout rooms complete with humansized cardboard cutouts of customers and then filled the building with cross-role teams. Next, Forrester advises companies to have liaisons to grease the wheels of communication between IT and business. Many companies already have such employees, often called

“I’ve caught myself numerous times wanting to do an end-run-around IT,” Cochrane admits. He says working for a technology company can be more a curse than a blessing. “Having deep knowledge of technology isn’t good. Sometimes I know too much to basically say, I can do this myself. But I stop myself because I know I’m going to hit a wall six months later when I want to do the next thing.”

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business analysts, who have an acumen for both business and technology. Forrester’s third tip takes liaisons to the next level: “Create formal, hybrid-skills groups, or digital centers of excellence, which draw on skills and expertise from IT, application development, digital strategy, digital marketing, communications, customer support, and even project management.” In addition to the common ground of the customer experience, IT and business units can rally around data and analytics. For business units, there’s gold in them hills of customer data. That is, they can improve tactical processes, such as personalizing the digital customer experience, and make better strategic marketing decisions if they only knew more about their customers. IT can be the data miners that dig through the various data silos—CRM, ERP, Web content systems, to name a few—and find the nuggets that business units covet. By doing so, business units will quickly learn to appreciate what IT can do for them, and IT can become a true partner to the business side. Last, Forrester suggests IT look at ways to overcome its biggest weakness in the eyes of the business side: Slow response. There’s a reason business units bypass IT; in an ultracompetitive digital-mobile-social environment where fickle customers are armed with instant information, companies are racing to get to them first. It’s critical to be nimble in a fastmoving digital world, and IT traditionally hasn’t been able to keep up. —T.K

Knowing what not to do can be just as important. Some companies wanting to fix a dysfunctional IT-marketing relationship throw staff together in an open space. The thinking is that physical proximity leads to greater collaboration. But Cochrane says that’s a recipe for disaster. Just imagine marketers in the ecstasy of the creative process surrounded by a bunch of frowning-faced IT

programmers trying to code— neither would perform well. Lastly, Cochrane advises CIOs and CMOs not to fall back into the old habits that derailed relationships in the past. “If there’s a disagreement, just pick up the phone” and call your counterpart, he says. “Don’t go to the CEO, don’t bring it up at a budget meeting, don’t throw anyone under the bus.” CIO Send feedback on this feature to editor@cio.in

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The New Order of

Effectiveness In the enterprise, there’s no such thing as a oneman show. Teamwork forms the pillar of a successful organization and collaboration beyond boundaries forms the pillar of teamwork. In a recent roundtable, CIOs discussed ways to instill collaboration in the organizational grain. By Vinay Kumaar

o keep pace with the increasing demands of business, CIOs are constantly on the lookout for technological tools that would help their organizations be more agile and stay ahead of the curve. So, when business stakeholders say they want to be connected easily for quick decisionmaking, IT leaders make it possible with collaboration tools. However, concerns pertaining to security and organizational mindset are slowing down the adoption of collaborationin enterprises. To discuss how organizations can make best use of collaboration and how IT leaders can ensure it, CIO magazine, in association with Cisco, had recently conducted a roundtable. The discussion was moderated by IDG Media’s

editor-in-chief, Vijay Ramachandran. Tr a d i t i o n a l ly , verticals l i ke manufacturing are not really known for readily lapping up technology tools that are not directly related to the core production processes. A reflection of this can be seen in the case of collaboration tools as well. Balasundar Natarajan, CIO, ABB, touched upon this aspect when he said, “Collaboration is gaining traction in verticals like manufacturing only in the recent years. Users mainly want to be disconnected from desktops and laptops. Enabling that is the biggest challenge for us. In the past one and half years, we’ve done a lot of non-conventional collaboration and have our own social platform for users. As a result of this,

EVENT REPORT CISCO

Cover Story I can see that the usage of e-mails has drastically come down, by about 35 to 40 percent, thereby enabling quicker decision-making.” On the other end of the spectrum, there are verticals like IT which are wellknown for instantly embracing technology of any kind. However, they’re not devoid of their own challenges either. Darshan Appayanna, CIO at Happiest Minds - a leading IT solutions company, shared the challenge he faces. “From my perspective, there’s a collaboration overload. There is a huge proliferation of collaboration tools that users are not sure which one to use. Identifying a single solution that caters to all users’ needs and drive collaboration using that would be a big problem, going forward,” he said. No matter how effective collaboration can be, IT leaders should do their best to drive user adoption for it to show results. Ramakrishnan Sudarshanam, divisional VP-IT, United Breweries, spoke about this crucial aspect. He said, “The collaboration platform has to be informal in order to make users curious and enthused about trying it out. Conducting minor contests and sending regular mailers related to activities on the platform can help achieve this. Over a period of time, you can create a separate network for other organizations, like your suppliers, and channel communication through this. That’s where the ROI and benefits of collaboration can be derived.” However, the management has a vital role in driving adoption of collaboration technology as well. Ranendra Datta, VP-IT, SABMiller, shed light on this area. “There

Cisco strongly believes video is the nirvana of what we want to do and we’re also aware of the importance of providing a seamless experience irrespective of the device used. - Andre Smit, MD-Collaboration Solutions Sales, APACJ & Greater China, Cisco are instances where you can quantify ROI, as opposed to showing intangible benefits, when it comes to collaboration technology. Unless and until the management mandates it, you can’t put it to effective

use. Organizations need to append a KPI measurement parameter in the case of collaboration.” Having said that, while collaboration is indeed a beneficial concept, it’s not just a single technology but a melange of tools that’s in play. Therefore, it’s important for CIOs to realize which of those will help them derive maximum benefits. Andre Smit, MD-Collaboration Solutions Sales, APACJ & Greater China, Cisco, elaborated on what makes video the most effective of all collaboration tools. “One of the big elements about collaboration is trust. The best way to ensure collaboration without compromising on trust is video conferencing (VC). As of now, VC is confined to the executives and high level employees. It hasn’t pervaded to the level of every single person in the organization. That’s because the cost of setting up the infrastructure is too high. Cisco aims to bring down these costs. We strongly believe video is the nirvana of what we want to do and we’re also aware of the importance of providing a seamless experience, irrespective of the device used,” he said. Smit further spoke about the different industries and organizations that have benefitted greatly through VC. “Verticals such as healthcare are adopting VC increasingly. The Australian Federal Government has made a successful implementation wherein major Government offices are connected over a secure network. This has led to significant cost savings on travel and reduction of carbon emission for the government.”

This event coverage is brought to you by IDG Services in association with Cisco

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from the TOP

Samir Shah, MD & CEO, NCDEX, says that every crisis presents an opportunity to reform business and IT can enable that transformation.

What do CEOs and other C-level executives expect from you? Read all about it in VIEW FROM THE TOP. Visit www.cio.in/ceointerviews

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Rooting for

Reform BY SNEHA JHA

A call for change: That’s how the year 2013 will go down in history. Undoubtedly, it was the year that brought people around the globe to the streets rooting for change in political equations, in economic realities, and in societal convictions. Akin to that fight for change, somewhere in the corridors of India’s second largest commodities Exchange—National Commodities and Derivatives (NCDEX)—Samir Shah, MD & CEO, NCDEX, was stirring up a small revolution. When Shah took over the Exchange in the summer of 2013, markets were down and growth prospects bleak. The Exchange itself was stuck in a time warp and needed a fresh coat of paint. But Shah was unfazed. And that’s not surprising. With over 20 years of experience in turning things around, Shah, in his previous organization, was instrumental in making Dubai Gold and Commodities Exchange (DGCX) one of the fastest growing Exchanges in the world. An alumni of the Wharton School of Business, Shah knew that he would have to repeat that feat. Today, less than a year at the helm, Shah has launched several innovative contracts and breathed new life into shelved IT projects. And that’s transforming NCDEX.

You took charge of NCDEX last year. What challenges did you face? When I joined NCDEX, the Exchange was facing a drop in volumes and a reduction in trading participants.

Concurrently, the commodity cycle worldwide was in a bearish mode. Commodities Transaction Tax (CTT) had been announced in the budget and that had adversely impacted market sentiments and investor confidence in the commodities

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SAMIR SHAH EXPECTS I.T. TO Widen investor base Align with business objectives

PHOTOS BY SUMEET SAWH NEY

Modernize rural markets

market. Then the NSEL crisis happened. Although we were not affected by the crisis because it happened at another Exchange, but it affected the agriculture sector and NCDEX is the largest agriculture Exchange in the country. The crisis shook the confidence of stocks in warehouses and the credibility associated with warehouses and commodity trading. The crisis was the last straw. The series of unpalatable events unfolded one after another. I took the reins of NCDEX in such trying times.

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How did you tackle these challenges? There is a tremendous growth opportunity in the commodity markets in India. I firmly believe that commodity markets in India should be significantly larger than equity markets. There are three segments in the commodity market: Agriculture, metals, and energy. Letâ&#x20AC;&#x2122;s look at agriculture. Worldwide, a significant portion of agricultural production actually gets traded and

churned on commodity Exchanges. If you were to value last yearâ&#x20AC;&#x2122;s crop production, in terms of rupees, it was about Rs 9 lakh crore. But only a fraction of that amount actually got traded at the commodity Exchange. I realized that there is a huge untapped opportunity in the commodities market. To tap into that, we needed to refresh some of our old contracts. For example, our key contracts like gram and castor needed a refresh. We had to develop a

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View from the Top

slightly different way of looking at these contracts. So we introduced a smaller size contract for gram and castor. With this, we targeted a specific segment of the market place which hadn’t been tapped into: The financial and retail investors. They had been excluded from participating in the market because they did not have a fit-forpurpose contract. This experiment is still in its initial stages. Once it gains traction we want to replicate it for other contracts as well. In the non-agriculture sector, we re-launched the steel contract. I am very bullish about steel contracts. We made an attempt at launching steel contracts a couple of years ago but there were changes in BIS (Bureau of Indian Standards) laws, hence steel contracts did not perform well. So we had to retire our contract and re-launch it. It’s gaining traction in the market now. We re-launched the crude palm oil contract (CPO). Despite being the largest agriculture Exchange in the country, it was a bit strange that we never had an active CPO contract. So I thought it necessary to focus on one. We launched more contracts in the last one year than the Exchange has done in the last five years. And the idea was that if we have to tap into the potential of the market place then we need to have contracts that are designed to suit the different needs of the customer. You can’t have a one size fits all. The market is quite complex. You have arbitragers, real hedgers, farmers, mandi traders, large corporates, and retail investors. And each investor has a different way of looking at the market. We also launched a very unique design called the gold hedge and the silver hedge contract. Earlier, gold and silver contracts were physical delivery-based contracts. The government is now discouraging investment in gold in the physical form because it creates current account deficits and leads to higher amount of imports. So we needed to convert the physical holding to a financial form. Keeping that need in mind, we launched a financial 50

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“It’s important that the heads of business and IT are joined at the hip. They should work like a pair of Siamese twins.” — Samir Shah version of gold and silver contracts. The contract is a month-and-a-half old now but it brings in almost Rs 200 crore a day. This shows that there was an appetite for this kind of a contract. Therefore, designing products that are customized to suit different segments of the market was one of my focus areas.

What other innovations did you introduce? NCDEX has been a pioneer in warehouse infrastructure. We created COMTRACK, an electronic Web-based system which facilitates electronic accounting of commodities deposited in the warehouses approved by the Exchange. It connects the Exchange, warehouses, assayers, members, investors, and clients. However, the warehouse mechanism in India is fairly underdeveloped. It’s barely 10 years old and a lot needs to change. So I embarked on a strategy that I call logistics version 2.0 to create a new set of standards in warehousing. We are in the

process of implementing that. Also, after the NSEL crisis people’s confidence in stocks stored at warehouses got shattered. It was extremely important to come out as a leader to show to the market that we believe in the warehousing way of participating in the commodities market. Then I focused on customer centricity. We weren’t perceived as a customer focused Exchange. So, for the first time in the history of commodity Exchanges, I ran a customer satisfaction survey--conducted by an agency called Grass Roots. The findings of the survey stated that customers wanted us to make a step change in customer orientation. Based on that, I restructured the front office of my company. I made two groups in the company: One is the business development group and the other is a relationship management group. Another key aspect is technology. I re-prioritized a technology project that was languishing for three years. We indigenously developed what is called a Spread Engine. Worldwide, commodity markets are driven by spread trades. Our spread engine helps participants place spread orders. This facility enables spread trading using daylimit orders. Today, 25 percent of all our trade comes through this spread tool.

The true barometer of an Exchange is a healthy open interest. How does IT help you achieve that? Open Interest (OI) is an extremely important metric that shows the health and effectiveness of an Exchange. We have the best volume to open interest ratio in the country. We may be the second largest Exchange in the country in terms of volume but our volume to open interest ratio is much better than MCX. This shows that people trust us. Open interest indicates that the true end user is actually participating at the Exchange. Our OI is actually higher than our volume which is a fantastic foundation to have for any Exchange and we have always focused on it. We achieve that focus by keeping the

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View from the Top

SNAPSHOT

NCDEX end user in mind. We have a special team of product specialists who engage with end users, explain to them the meaning of hedging and get them connected on to the platform. At the same time, we like to connect our mandi participants and farmers with our platform and technology has a very critical role to play in that. Also, our three technology platforms-spread trading, COMTRACK and unified market platform--are indigenously developed and they contribute to price discovery.

That’s interesting. Would you prefer to be an early adopter of technology? I tend to believe that it’s wise to be an early adopter and take some calculated risks. The growth opportunities in the market are aplenty. Commodity markets in India have been fairly uni-dimensional as far as the use of technology is concerned. We need to deploy more leading edge technologies to widen the participation of retail players, farmers and traders in the mandis. I’ve had the fortune of working with companies that are at the cutting edge of technology. It gives me the confidence to explore possibilities that have so far not been explored in the commodities market in India.

Should the role of the CIO be given to someone from business rather than technology? I thinks that’s far too simple a way to look at it. It’s important that the heads of business and IT are joined at the hip. They should work like a pair of Siamese twins. I’ve made that integration happen. For instance, we are in the process of selecting our new trading system and that we believe is a paradigm shift to the way trading is done. The sponsor of that project is my chief business officer. However, the CIO is a key participant in the project because he handles the selection of the partner and implementation of the project. Likewise, when we rolled out our Spread Engine, we put in place a cross function team

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comprising business and technology people.

ESTABLISHED:

2003

EMPLOYEES::

The retail investor base is small in India. How are you using IT to tap into this opportunity?

1,500

HEADQUARTERS:

Mumbai

IT TEAM:

There is a two-pronged strategy to engage and attract retail participation. One is to have better designed contracts to suit retail investors. For instance, gold and silver hedge contracts, and the one metric ton contract that we launched for gram and castor are better suited for a retail investor. Another strategy is to launch an awareness drive for retail investors. We are using IT, mobile, Internet technologies and social media to promote awareness and connect with them more effectively. Aggregation of retail investors through fund structures is a global best practice that is needed in India. Worldwide, retail investors participate mostly indirectly through financial institutions. They participate through vehicles called CTA (commodities trading advisors). This is a unique practice followed worldwide and we need to import it to India. But we need a regulation to make that change.

What are your plans for expanding the agricultural futures market to benefit the farmer fraternity? We are trying to create more transparent electronic modern markets at the APMC (Agricultural Produce Market Committee) level. The experiments that we are doing in Karnataka form part of that strategy. We want to replicate that in the other states in the country. Modernizing the APMCs and then connecting them to the futures market is the first part of the strategy. The second is to launch more customized products for them. For instance, we launched a service called Exchange of Physicals for Futures (EPFs) that is a better

suited product for farmers and physical participants. The third part is to create more membership categories to allow farmers and Farmer Producer Organizations (FPOs) to participate more easily in the Exchange. We need to bring a change in the membership structure.

What reforms are needed in the commodity market to boost investor confidence? We should start by allowing foreign entities to participate in Indian commodity Exchanges. China and India are driving consumption in the global economy. Likewise, commodity markets will shift their gravity from west to east. India is the largest producer of many commodities so ideally we should be the price setter and not the price taker. However, in the current scenario, we are the price takers because our liquidity is low and we do not allow foreign participants in our market. Foreign participants can make our market more liquid. The third reform we require is that the micro structure of agricultural commodities should be brought to a level-playing field with non-agricultural commodities. More liberalization needs to happen in agricultural contracts. Till now, they have been treated with a lot more control. Bringing the two on a level-playing field will help us deal with inflation and food security more effectively. Also, we should allow banks, financial institutions and mutual funds to participate in the markets. Banks have an extensive exposure to the commodities market due to programs like priority sector lending and farmer loans. Participation of banks will bring in more professional expertise and research. This will make the market more liquid. We also need to reform the primary APMC markets. CIO Send feedback to sneha_jha@idgindia.com

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Prescribing the

Perfect Drug A technology platform that uses data analytics allows Mitra Biotech to find the most effective cancer drug for specific patients in seven daysâ&#x20AC;&#x201D;exponentially faster than traditional methods.

BY SHUBHRA RISHI

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FEB-

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sk any child what the largest mammal in the world

is and you’ll probably be told it’s the blue whale. At 30 meters and weighing over 170 tons, the child wouldn’t be wrong. Its size, however, isn’t the only thing that makes blue whales special. It is also more likely, given its size, to get cancer compared to any other mammal. In the words of author Carl Zimmer, “Strictly speaking, there should be no blue whales.” And yet, they live. In fact, blue whales can live for over a century. The longest living blue whale has flipped its large fins for 114 years. Scientists believe that they possess a natural mechanism that suppresses cancer that’s a 1,000 times effective than humans. Humans can be affected by over 100 types of cancer. According to the World Health Organization, cancer causes close to 500,000 deaths in India every year, and by 2017, that number will rise to 700,000. High treatment costs is one of the big challenges to beating cancer. Slow, inaccurate treatment is another. Here’s the dark truth about cancer treatment: Choosing the right treatment involves some amount of guesswork. While selecting which type of chemotherapy to use, doctors rely heavily on experience and information available from historical data. Despite advances in science, finding the right drug is often a matter of trialand-error. One company plans on changing that.

Early Symptoms Founded in 2009 by three Indian scientists, Dr. Mallik Sundaram, Dr. Pradip Majumder, and Dr. Shiladitya Sengupta, Mitra Biotech is a personalized cancer biology company headquartered in India. Mitra Biotech has gotten media attention thanks to its technology that offers a way to drastically reduce the guesswork around cancer medication—and speed up the process of figuring out the right

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By creating CANScriptTM, Dr. Mallikarjun Sundaram, and his team, eliminate trial-and-error, cutting down delays and unnecessary toxicity in patients. medicine. It’s on Fast Company’s list of the 10 most innovative companies, “for rethinking conventional cancer drug therapies by applying data analytics.” Before they launched Mitra Biotech, the three scientists ran a company in the US known as Mitra Life Sciences. Among his other accomplishments, Dr. Sundaram, an alumni of IIT-Varanasi, taught at MIT, Cambridge, MA, training students in the area of complex analytics and cancer biology. He also co-founded Momenta Pharmaceuticals and developed an FDA-approved, generic drug known as M-Enoxaparin. In 2010, the first year of approval, M-Enoxaparin brought

60 percent of the $4.5 billion global sales to Momenta and its partner Novartis. Dr. Majumder developed and steered two anti-cancer drugs from laboratory to Phase 2 of clinical trials in the US. He was also a professor of oncology at Harvard Medical School. And Dr. Sengupta is an assistant professor at Brigham and Women’s hospital at Harvard University. In addition to Mitra, he has co-founded Cerulean Pharma (US), Vyome Biosciences (India) and Invictus Oncology (India). In 2009, they decided to shift base to India because they saw the scope to help a larger pool of cancer patients. REAL CIO WORLD | A P R I L 1 5 , 2 0 1 4

Case File | Mitra Biotech Technology Therapy Traditionally, there are a couple of methods doctors use to select a cancer drug. One uses bio-markers to track the effects of cancer treatment. Biomarkers can be specific cells, molecules, or genes, gene products, enzymes, or hormones which can determine which cancer drug isn’t effective—but it can’t tell which drug works for a specific patient. Another method, the Xenograft mouse model, transplants cancer cells from humans into mice. Mice are then dosed with different drugs, until the right one is found. It’s a slow method though. According to Dr. Majumder, it can take four to six months for cancer cells to grow inside a mouse, which delays the drug selection process.

For different reasons, neither of these methods are as effective as people hope. The founders of Mitra Biotech knew this, and worked on a solution to the problem. That solution is called the CANScriptTM model. The CANScriptTM model is a platform that hosts cancer tumors in its native form in a specially customized incubator and provides a micro-environment where different drugs can be tried on cancer tumors. The CANScriptTM model shrinks the time it takes to select the most appropriate drug from months to just seven days. Part of the reason the CANScriptTM model can do that is thanks to its robust analytical framework. CANScriptTM results are expressed in a predictive measure

called the “M-Score”. The CANScriptTM model measures the effect of multiple drugs on a patient’s tumor using as many as 17 different parameters to assess the key effects on cell viability, cell death, tumor morphology, and cell proliferation. The raw data from these assays are converted into numerical scores that range from 0-100. Mitra’s proprietary algorithm then assigns appropriate weightages to individual assays and then converts them to a single, numerical, predictive score called M-Score. The higher the M-Score, the greater the probability that a given drug combination works for a specific patient. The M-Score algorithm was developed by simultaneously measuring patients’ clinical

Finding Cancer Cures Faster Mitra Biotech created a system that can find the most appropriate cancer drug faster and more accurately than traditional methods. And it relies heavily on data analytics.

The Traditional Approach There are a few traditional methods used to find the right combination of drugs to beat a specific cancer in a specific person. But they tend to be expensive, time-consuming, and inaccurate. Here’s one method.

The Xenograft Mouse Model: Transplants cancer cells from humans into mice. Mice are then dosed with different drugs, until the right one is found. Cons: It’s a slow method since it can take months for cancer cells to grow inside a mouse.

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The Mitra Biotech Approach The CANScriptTM model uses data analytics and specially customized incubators to shrink the amount of time required to find the right cancer drug.

The CANScriptTM model hosts cancer tumors in a specially customized incubator, where different drugs can be tried. It measures the effect of multiple drugs using up to 17 different parameters to assess effects on cell viability, cell death, tumor morphology, and cell proliferation. This raw data is converted into numerical scores (from 0-100). Mitra’s proprietary algorithm assigns appropriate weightages to individual assays and then converts them to a single, numerical, predictive score called M-Score. The higher the M-Score, the greater the probability that a drug combination works for a specific patient.

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responses to given drug combinations as well as CANScriptTM measurements across multiple dimension (17 assays measuring the tumor’s response to drugs). Advanced bio-informatic tools were used to assign differential weightages and arrive at a unique algorithm with the least cumulative penalty when comparing the prediction to actual clinical outcome in 1,000 patients in the training set. This was further confirmed in a separate set of 1,000 patients in the test cohort. Cumulatively, CANScriptTM has a very high sensitivity and specificity for different class of drugs-chemotherapeutics, biologicals, and targeted drugs. Data analytics is the key to the spectacular success of CANScriptTM model. “The accuracy level of the analytical system is extremely high, ranging between 90 and 95 percent,” says Dr. Sundaram.

Rx Accuracy The CANScriptTM model, with its data analytics framework, doesn’t only provide faster results than traditional models, it can also ensure more accurate results. Dr. Sundaram cites the example of a 57 year-old male suffering from head and neck cancer. The patient’s first line of treatment with Cisplatin, Docetaxel and 5-FU (CDF) failed. CDF is the most often prescribed drug for first line of treatment. They performed CANScriptTM analysis on his tissues with a list of drug combinations recommended by his physician. One of the drugs in the list was a combination of Cetuximab+Cisplatin+5-FU—usually not recommended during the initial stages of treatment. “But as it turned out, CANScriptTM helped us identify the right drug and it was effective in ensuring a complete response from the patient,” says Dr. Sundaram. This exercise of eliminating trial-anderror not only avoids delay in delivering the right treatment but also saves the patient unnecessary toxicity and side effects. It also has huge cost benefits. “There are lots of other patients with solid as well as hematological cancers who have benefitted from our technology,” says Dr. Majumder. There are other types of cancers that Mitra Biotech is helping patients with. HER2+ cancer, for instance, is a type of breast cancer. Herceptin is one of the drugs

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Dr. Majumder is part of the team which created a solution that shrinks the drug selection for cancer drugs to just seven days. recommended to HER2+ patients and can existing investors such as India Innovation cost lakhs in treatment in India. The drug, Fund and Accel Partners. however, may not be effective on all patients “We wish to ease the treatment cycle for suffering from HER2+ type breast cancer, patients and support their fight against cancer and could result in patients spending by helping them choose the appropriate drug,” enormous amounts of money. “Only 35-40 says Dr. Sundaram. percent of the patients respond to the Going forward, the company hopes treatment,” says Dr. Sundaram. to optimize its technology platform and Mitra Biotech is partnering with leading strengthen the process of drug discovery and Indian and American cancer hospitals such help cancer patients find the perfect drug. as Tata Memorial Hospital, MazumdarWe’ll probably never have the blue whale’s Shaw Cancer Centre, HCG Cancer Care ability to resist cancer, but with CANScriptTM, Network, and Cancer Treatment Centers of it may be possible to address cancer faster. CIO America. Last year in October, Mitra Biotech raised funding of about Rs 40 crore from Shubhra Rishi is senior correspondent. Send feedback Tata Capital Innovations Fund, along with on this feature to editor@cio.in REAL CIO WORLD | A P R I L 1 5 , 2 0 1 4

Getting IT Future Ready With its launch of new Unified Storage solutions that promise enterprise class at midrange affordability. By providing flash storage at the price of disk, Dell vows to redefine the economics of storage and enable enterprise future-readiness. By Gunjan Trivedi

ecently at Mumbai, CIOs participated in an exclusive IT leaders’ platform and experienced an extraordinary evening, where business technology leaders and experts came together to unveil and share the latest in IT innovations, listen to the business management and leadership insights shared, and collectively aimed for Future-Readiness at personal and organizational levels. To set the context of the event with a perspective on how to prepare for success, India’s first and only individual Olympics Gold Medalist, Lt. Colonel Abhinav Bindra, shared his experience and his views on Challenging Convention and Transforming Tomorrow.

SPECIAL EVENT COVERAGE

Playing Gold Standard Bindra spoke at length on the lessons he drew from his journey to success, and how he worked with today’s constraints and challenges to enable tomorrow’s advantage. He explained how both losing and winning can be difficult, yet meaningful experience. Bindra stated that one should focus on the journey to continuously hone skills and overcome impediments irrespective of the outcome. “My attention to details improved significantly much more from Athens to Beijing Olympics. I was even trained for a situation to continue shooting sharply even if my sight was disturbed. The chances for this were quite low. However, at Beijing it

did happen. But, I was trained to handle it,” recalled Bindra. He went on to say that after Athens, he learnt the art of detaching himself from the outcome. At Athens, the focus was just on the medal, he said, but at Beijing, he didn’t even care about the medal. “I was focused on executing each and every shot and I was immersed in the moment of that performance. That allowed me to win. This sense of detachment was born out of the experience of failure,” he stated. And, while preparing, he elaborated on how he and his team extensively uses technology to assess his approach, analyze his actions and course-correct accordingly.

SPECIAL EVENT COVERAGE DELL

Bindra described how his coach records a lot of data related to how he shoots each shot, how much time he takes and more. After a competition is over, Bindra and his team go back to the data to analyze and deliberate on what he did well and what went wrong. “A host of technology solutions provide me with feedback in a precise manner to take corrective action that helps me,” he said. In fact, he recalled that prior to Beijing Olympics, he did a lot of bio and neuro feedback training that analyzed his brain activity. At one of the sports technology laboratories at Capetown, South Africa, his brain was monitored and mapped as he went through shooting over 1500 shots. A lot of data was generated, stored, and analyzed by a team of experts. “We realized that there were certain parameters that were being duplicated when I shot well. Then I trained myself to replicate it and be in that frame of mind. I strongly believe that technology plays a very important role in modern sports,” said Bindra.

The New Economics of Storage While CIOs’ journey to address business needs and their strategic endeavors to

“I strongly believe that technology plays a very important role in modern sports.”

— Abhinav Bindra, Olympic Gold Medalist

future-proof their organizations continue, on an operational ground, it’s pertinent to experience innovations in the new-age technologies to create the ecosystems that support growth and enable agility. True to this, John McCloskey, Solutions

Director for the APAC & Japan, Storage Business, Dell and Neeraj Matiyani, DirectorStorage Business, Enterprise Solutions Group at Dell launched the company’s latest innovation, the Unified Storage solution SC4020, which prepares organizations for future-readiness and changes the economics of storage with flash. McCloskey and Matiyani shared their inputs on how they see the Enterprise Storage industry shape up, and how Dell aims at helping its customers in preparing for their future readiness. They detailed how the Unified Storage solution SC4020 will positively impact the business and what will change for their customers. McCloskey maintained that IT rules are being rewritten. “We have got emergence of big data, cloud computing, security, the software of IT, and that is making changes in the way our customers look at how do they store, analyze and grow their storage,” he underscored. This introduces some architectural changes, as there are no longer silos of compute, networking and storage that exist. Convergence is beginning to come to play, McCloskey pointed out. “In fact, convergence is actually about developing a rapid pace to change. A lot of customers are asking Dell how to gain flexibility and scalability while managing their investments. How do we get best of both the worlds of the new and the existing investments that had been done over a period of time?” he stated. McCloskey elaborated on the fact that through many years of working closely with companies like Google, Facebook and Amazon, Dell has taken the best out of what these companies have done to become world leaders. “We have added this to the best of the billion of customer conversations that we have had over the years to understand where do you want to get to. In this way, we are trying to drive and change the economics of storage to make it more affordable. Ultimately, the crux of the matter is to do more with less. That’s why we have been working hard at it. We have had nine product launches in last eight months. And today, we bring flash storage at the price of disk to our customers,” he announced. While announcing the launch of Dell’s Unified Storage solution, the Compellent SC4020 series of mid-tier storage arrays, Maityani stated, “We deliver the new

“We are trying to drive and change the economics of storage to make it more affordable. And today, we bring flash storage at the price of disk to our customers.” —John McCloskey, Solutions Director for the APAC & Japan, Storage Business, Dell economics of storage by ensuring that your data is the right data at the right time in the right place for the right cost.” Matiyani explained that when the product was designed, the team kept in mind that there would be different kinds of media, diverse environments that may be virtualized with varied workloads and absolutely uncertain future. Unlike established old storage vendors, new-age tiering technologies have been natively built into the product, he said. He elaborated that just as the industry has requirements for expensive and high performing Serial Attached SCSI (SAS) and cheaper near-line SAS today, we’d soon have flash storage arrays that would mimic the correlation between the cost of the storage and its performance. Most of the present day storage players do not have a feature to tier between these two kinds of flash storage. “In my opinion, you’d need this feature quite soon. Today, Compellent delivers this feature as you can tier between lowcost, low-performance flash (which is anyway faster than hard disks), and the high performance flash environments. The SC4020 range extends enterprise features to customers that are keen on mid-range affordability, while enjoying performance over 100,000 IOPS and scalability upto 400TB. This gives you new economics of storage without making you suffer from the amount

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of investments that you have to make,” pointed out Matiyani.

Product Showcase: Dell Storage SC4020

Balancing Growth versus Efﬁciency The audience also got to understand the strategic perspectives and the tactical impacts of keeping pace with burgeoning business ask on IT and balance the growth versus efficiency equation in an interactive Panel Discussion with three CIOs along with Dell’s Neeraj Matiyani and S.Sridhar, DirectorEnterprise Solutions, Dell. The panel was moderated by Vijay Ramachandran, Editorin-Chief, IDG Media. The CIO panelists were Sunil Mehta, Senior VP & Area Systems Director -Central Asia, JWT, Ajay Meher, CIO, Multi Screen Media and Rajesh Saboo, Head of IT at Future Group. “To get operational and management capabilities converged into one platform is becoming increasingly pertinent for today’s organizations. No one buys technology for the technology sake. What is expected from us has changed. Now an IT vendor would have to worry about its customer’s bottomline and topline concerns through IT. From a solution provider’s perspective, we look at it as a convergence of three aspects to deliver on our customer’s outcomes: preparedness, partnership, and performance. Creating customer value is primary for us,” said Sridhar.

“We deliver new economics of storage by ensuring that your data is the right data at the right time in the right place for the right cost.” — Neeraj Matiyani, Director-Storage Business, Enterprise Solutions Group, Dell

SPECIAL EVENT COVERAGE

The new Dell Storage SC4020, which can scale to 408 terabytes of raw capacity, supports a wide range of workloads for organizations across all industries and sizes. It offers:

“No one buys technology for technology’s sake. Creating customer value is primary for Dell.”

— S.Sridhar,

Director-Enterprise Solutions, Dell

Mehta agreed that the focus is now not on how much are you spending, it’s more on what you are doing with what you had already incurred. That’s why efficiency becomes one important scale to measure growth and success. “At any organization, three things matter to business: how does IT impact the topline and bottomline; is it easy to begin on a specific journey and how does it help in both efficiency and scalability. The challenge is that they don’t understand standardization and technology roadmap. They are usually short-sighted on their goals. That’s where we need to step in and tread carefully,” pointed out Saboo. “Usually we forget the basic aspect that we need to stabilize th e present and ensure that we derive most out of our existing infrastructure investment,” said Meher. The panel agreed that as data converts to information to business insight, it all depends on how do you provide capabilities that can scale, and build a design that is capable to deliver the business outcome. On the sidelines, several CIOs shared their favorable feedback on the event and the solution that was launched. In fact, a few of the attendees stated that from a mindshare perspective, Dell is making its presence felt quite strongly in the enterprise storage domain; and since they liked what they heard about the solution, they would be open to evaluate as the need be.

• Unprecedented value with a highly efficient SAN and compact size, making it ideal for mid-sized needs or remote or branch office deployments • Enterprise-class performance with dual controller capability and SAN optimized for all-flash or hybrid SSD/ HDD configurations • Flexible networking with fiberchannel connectivity and iSCSI support available for replication • Best-in-class intelligence with advanced levels of automation and control to auto-tune the customer’s storage environment • Advanced capabilities such as automated tiering, replication, thin provisioning, snapshots and centralized management for multiple local and remote SANs • Perpetual software licensing that enables customers to pay only once for software features, even across hardware upgrades • Unified storage with the ability to manage both block and file storage, with the Dell Fluid File System, from a single management console • World class Dell Copilot support services that provide a combination of centralized support and 24x7 active system monitoring to help improve system performance and stability

This event report is brought to you by IDG Services in association with Dell

SPECIAL EVENT COVERAGE DELL

1. The CIOs received autographed copies of India’s only individual Olympic gold medalist, Lt. Colonel Abhinav Bindra’s bestselling book - “A Shot at History”. 2. In a one-on-one interaction with IDG Media’s Editor-in-Chief, Vijay Ramachandran, Bindra shared more insights on his journey towards transformation and success. 3. A panel comprising Dell executives and leading CIOs from different verticals discussed how organizations can strike the essential balance between growth and efficiency. 4. The CIOs gained various business and technological insights from different sessions.

5. CIOs network during the event.

4 5

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CXO Agenda | Investments

CIO: Given the global economic downturn, what’s the last few years been like for the investment function?

Koushik Gopinath, Chief Investment Officer, Tata AIG General Insurance, illustrates how IT has been instrumental in helping keep the value of the company’s investment portfolio competitive.

KOUSHIK: The growth of our business is related directly to the growth of the country’s economy. For example, our motor insurance business is directly impacted by the way the automobile industry performs. We are also affected by the rising cost of healthcare; for us it’s an opportunity to increase our health insurance business. The investment function plays a very key role whenever a cyclical downturn in the economy occurs. The investment portfolio is expected to absorb a lot of the shocks that a company faces during an economic downturn. The management of these investments becomes very critical because we have to provide a lot of liquidity to the company. Say, for instance, there is a series of very large claims, the investment team has to ensure that there is sufficient funds in liquid assets to make payments. In the same breath, we also have to ensure that funds are invested in instruments that will give

IT Retu B Y VA R S H A C H I D A M B A R A M Koushik’s Agenda: To stand out in a crowded market by revolutionizing customer experience through IT-driven initiatives.

periodic returns to the investment portfolio. That’s the essence of investment management within the company. In the next financial year, our focus is to continue to engage with the business to ensure that funds are invested so that we are in a position to fulfill all our obligations to policy holders. At the same time, we strive to invest surplus funds in high-yield, fixedincome instruments—without compromising the credit quality of the portfolio—so that our returns are on par with industry returns. What stands in the way of these goals?

The challenges are numerous. The biggest among them, from an investment perspective, is the volatility of the financial markets, especially over the next few months, due to the general elections. This volatility has a direct impact on our portfolio valuations. 60

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CXO Agenda | Investments The second large challenge is portfolio growth. We are confident that the worst is over for the economy, and that a stable government can provide that much-needed impetus for growth. That said, we have faced these challenges in the past—and we have overcome them. We are well-prepared to face these challenges again in the coming months. In a crowded industry, how is your company increasing its edge over rivals?

First, I think competition is very important because it encourages innovation. Competition ensures that the focus remains on customer satisfaction. Going forward, we shall continue to focus on three things. The first is innovation. We will keep innovating with new products and services. The second is to continuously improve our claims service,

despite the fact that we have already established a high standard. And, finally, we aim to enrich every customer’s experience. For this, we are hugely dependent on IT. We want to revolutionize customer experience through IT-driven initiatives, and therein lies our competitive edge. Can you give us some examples?

We implemented SAP six months ago, and it has transformed our internal processes. It also increased the speed at which we process all payments substantially. IT initiatives, such as this, have improved efficiency and enriched customer experience. We are also in the process of replacing our core insurance application. Today, investments are managed completely using an 62

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IT system. The investment IT setup has revolutionized the way investments are managed. Today, limits are monitored by systems, investment returns are generated by systems, and accounting entries are generated by systems. And because these are systemdriven, everything takes place at a much faster pace. The transition from Excel sheets to IT system has ensured minimum manual intervention, thus resulting in error-free transactions. Your company has increased IT investments. What do you expect out of IT?

We live in an era where speed is of the essence, and customer needs are more challenging to meet. The needs and requirements of customers change on a day-to-day basis. To fulfill these customer demands, you need a robust IT setup. The setup should be able to adapt to the dynamic changes happening on the technology front.

Among the most visible areas where IT has created such a transformation is banking. You have to agree that footfalls in branches have lowered significantly because customers can transact online. That’s where IT plays a key role. For us, we are very focused on having a robust IT infrastructure in place, which will encompass all departments along with customer interactions. We are also engaging in social media; we’re using Facebook to address customer complaints. Access to online transactions definitely helps create more customer awareness. Could analytics help mitigate the unpredictability your function faces?

We use the Reuters EIKON for all our investment analytics

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CXO Agenda | Investments and data. Reuters provides us with news that directly impacts our investment portfolio. It helps make quick and informed decisions. It also has various valuation models that are built into the system. We use this information for peer comparison and the results have been very encouraging.

is trust that binds both the insurer and the insured. And that trust requires the complete confidentiality of information. The IT setup captures all the information of the insured and hence it is important that the IT setup is well protected. The regulated environment ensures such confidential agreements are not breached.

Should IRDA relax some regulations, to allow more IT-led efficiency, like using the cloud?

Do you believe the IT standardization imposed by IRDA is good for business?

I want to address the investment regulation part of the question first. From an investment perspective, we firmly believe in a regulated market. India has been insulated from global shocks primarily because we have well thought-out regulations. If you look at the financial market crisis in 2008, though we did face some market volatility, it was miniscule compared to what the US went through.

Yes, I agree with what IRDA has done. IRDA is in the process of implementing a business analytics project, which shall have various modules. Insurers are expected to submit all required data in a prescribed format, and this data has to be uploaded in their system. Such a standardized template will help with data analytics as all information, across the industry, shall be uniform. IRDA has made it mandatory for insures to upload financial information on its website. This initiative has helped not just policyholders, but also companies to form strategies in line with the competition. It also allows policyholders to assess the financial position of an insurer before making a decision.

speed is of the essence, and customer needs are more challenging to meet. To fulfill these Today,

you need a robust IT setup.

demands,

IRDA, our industry’s regulatory authority, has ensured that investments are well regulated thus ensuring policyholder protection at all times. IRDA also ensures frequent interaction between the industry and itself and industry feedback is considered whenever regulations are formulated. When, the industry feels the need to relax regulations the same is communicated through various forums to the regulator. Take, for instance, how IRDA recently relaxed norms for investments in mutual funds by an insurer. It has issued norms for investments in Exchange Traded Funds. Also, the regulator has amended the sector and investee company limits keeping in view policyholder’s protection. Regarding IT flexibility, we need to understand the relationship between the insurer and the insured. It VOL/9 | ISSUE/06

Has IT helped grow your function’s risk appetite?

Today, all our investments are managed through a system. Various regulatory and internal limits are all monitored by systems. Credit rating upgrades and downgrades are system monitored, giving us a sense of comfort to increase our risk profile. Reuters has helped us with the data to analyze various companies where we could possibly look at investments. Such information is very critical, and today, our investment returns, and the credit profile of instruments, are among the best in the industry. You’ve seen IT evolve. What has been IT’s biggest contribution to the investment function?

If you look at the investment assets managed by the Indian general insurance industry, it is in excess of Rs 1 lakh crore. To manage such a large investment portfolio, one needs to think beyond the use of Excel sheets. In 2008, IRDA made it mandatory for all general insurance players to have proper IT setups for the investment function, and these needed to have separate modules for front, mid- and back offices. The system has helped reduce manual intervention as the system performs all key functions of limit monitoring, IRDA reporting, and accounting entry generation. If there is one thing you’d like IT to improve, what would that be?

Today, the investment function has very limited access to other systems within the organization. There has to be a seamless integration between various systems within the organization. We are in the process of implementing a core insurance application which shall replace our existing application. This shall help immensely to achieve efficiency in fund management. CIO

Varsha Chidambaram is principal correspondent. Send feedback on this interview to varsha_chidambaram@idgindia.com

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SPECIAL EVENT COVERAGE TATA COMMUNICATIONS

EXECUTIVE VIEWPOINT

THE COMING OF AGE OF TRANSFORMATIVE CIO WeConnect 2013-2014 by Tata Communications provided industry IT leaders a platform to gain insights and understand the challenges that plague their contemporaries. By Shweta Rao

eConnect 2013-2014 hosted panel discussions in Mumbai, Bangalore, Chennai and Kolkata which looked into bridging the IT-business gap. During the discussions, prominent Indian IT leaders deliberated on the evolution of the role of CIO in the Indian enterprise. The forum discussed, at large, the evolution of the Indian IT leader and the transformation brought about within IT teams thanks to disruptive technologies like big data, mobility and cloud. Over the years, there has been a definitive shift in the way IT has evolved and bridged gap between business functions. Business peers now look at IT as a stakeholder that is a risk-taker and a shareholder. Making IT Agile and Responsive Although functional divides between IT and

business still remain, modern IT teams have learnt to be more agile, responsive, and adaptive to business needs. Srivathsan Aparajithan, CEO of Vidal Health said, “A CIO has to be a leader who can take business decisions with a primary focus on the technology front. Such transformative leaders are important for the future of IT.” The fact that all IT heads have experienced a strong evolution in the way enterprises operate became more evident as the discussion progressed. “IT’s way forward can only be successful when it moves away from conventional guidelines and charts out an innovative strategy that impacts all business functions. Innovation has an expiry date. Organizations need to constantly innovate to retain customers, increase market share, and get ahead in the race,” said Aniruddha Paul, CIO at ING Vysya.

Winning with Role Transformation CIOs will also play a pivotal role in transforming customer experience, but customer engagement holds the key to greater success. Who then, blueprints the IT vision of the organization—business or IT? Samit Ray, Executive Director at KPMG, Kolkata, pointed out that an organization’s marketing strategy should be driven by the support it gets from IT, without which marketing or HR-related activities will never succeed. “IT is an essential ingredient in the DNA of organizations. It is driven by the user-experience it delivers,” he said. Becoming a Business Partner Most enterprises have matured in leveraging IT to aid not a single function, but an array of them. According to Vikram Subrahmanyam, MD and Head- Operations & Technology, South Asia, Citibank, the most important shift has been from business trying to control IT spends to IT driving the entire agenda. “There was a time when customer insight and business intelligence were largely still concepts waiting to be made actionable. Today, we leave technologists alone to do what they do best and handle only the business engagement,” he said. The transformational CIO of today is viewed as being ahead of his or her time. It is hoped that what constitutes innovation today will serve as a foundation to build for the future. At the end of the various panel discussions, the fact remains that the role of the CIO and that of the technology function will continue to morph as business inevitably evolves.

IDG SERVICES

SPECIAL EVENT COVERAGE TATA COMMUNICATIONS

VISION

2020 I

n the universe of technology, the only constant element is “change”. From the age of flimsy floppy disks to new age marvels such as augmented reality and 3D printing, technology has come a long way, and there is no stopping this wave of innovation. Taking the same idea of metamorphosis forward, V.S. Shridhar, head – India Enterprise Business, Tata Communications, set the context of his keynote speech at WeConnect 2013-2014. “The business environment is changing rapidly and employees are increasingly adopting a “prosumer” (professional consumer) trend. The prosumer of today doesn’t want to wait for the final finished product. They want to be a part of its development so that it really does, in the true sense of the term – ‘work for them’. You need to pluck the innovation out the hands of the developers and let potential users experience and drive the completion of the prototype. While it is important to seek breakthrough ideas, it is equally as important to innovate through rapid and alert incremental steps along the way. This is made more important as we move towards a mobile workforce, wherein mobility, BYOD, social networking, wearable

From wearable smart devices to smart cars, we are moving to an era of immense data generation, wherein big data 2.0 is going to become a norm, enabling big data insights to be analyzed and transformed into products and services.

V.S. Shridhar,

Head – India Enterprise Business, Tata Communications

devices, big data 2.0, IPv6, and 3D printing are some of the major global trends in the market today,” pointed out Shridhar. He also stated that a few years ago, organizations would never have opened new platforms like social media to their employees, but the picture is very different now as organizations cannot do without it. “Without social media, organizations will be cut away from important customer feedback and employees connect,” said Shridhar. According to him, the promise of newage technological innovations is immense since they give a greater degree of control to organizations to run their businesses with utmost agility. Apart from social media, the unprecedented explosion of users on the Internet has led to IPv4 addresses’ getting exhausted and giving rise to a new platform—IPv6. Shridhar also mentioned that 3D printing, which has been a norm with manufacturers for decades, has come of age and many companies and consumers are now adopting it more and more. “From wearable smart devices to smart cars, we are moving to an era of immense data generation, wherein big data 2.0 is going to become a norm, enabling big data insights to be analyzed and transformed

into products and services,” said Shridhar. Having elaborated on the emerging technology trends that are going to have a major impact on enterprises, Shridhar also stated that Tata Communications has come up with a whole gamut of solutions to assist the ubiquitous networks of the modern era. “We are working across diverse areas to help customers manage the changing landscape. Our efforts on this front include conducting interactive events such as the Hackathon—held at Silicon Valley and Bangalore – to support the development of next generation collaboration tools, and building our on-demand video conferencing solution, jamvee™ that lets our customers connect to meetings anytime, anywhere using virtually any device.”

This Event Coverage is brought to you by IDG Services in association with

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casefiles REAL PEOPLE

* REAL PROBLEMS * REAL SOLUTIONS

SURVIVAL OF THE

QUICKEST As Snapdeal’s business grew 200 times, it needed its IT systems to scale and support its rapid growth. How its CIO made that happen.

BY SNEHA JHA Shopping is an endless thrill. It gives a high that’s unparalleled. It’s powerful enough to make the most apathetic shopper succumb to his latent shopaholic impulses. But in today’s fast paced life scouring shops and standing in painfully long queues makes shopping a gruelling experience. Online shopping has changed that. Today, buyers can just check out the multiple choices available on their laptops, snap up the best deals and their shopping is done. And one company that does that in style is Snapdeal. The Organization: Snapdeal is one of India’s largest e-commerce companies. Launched in 2010, the online retailer boasts of a network of over 22 million members, over 4 million products across 500 categories and more than 20,000 sellers. The company caters to over 5,000 cities in India. Today, Snapdeal.com’s platform enables sellers to list products for sale on the site, manage inventory, and make up-to-the-moment pricing changes. The Business Case: While that sounds impressive, the amount of pressure this enormity of business puts on Snapdeal.com is overwhelming. Its inventory and pricing management system had to process more than 500 writes per second (write operation in the database allows sellers to make changes to the price and inventory). In the meantime, buyers review and rate sellers for customer satisfaction based on their product experience, including shipping, delivery, and returns. All this had to happen in real time. However, as the company grew at a blistering pace, it was faced with the challenge of managing data real-time. “In two years, we have scaled more than 200 times—the number of products listed, the number of sellers, the amount of business they do, the number of servers, storage and the technology team—everything has grown

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200 times,” states Amitabh Misra, VPEngineering, Snapdeal. The Challenge: To support its inventory and pricing system, Snapdeal had deployed 10 MongoDB NoSQL database servers with 5GB of data in DRAM as a cache in front of MySQL. As the seller base swelled and it started listing more products and making more changes in response to market dynamics, Snapdeal had to moderate the rate at which it was pushing updates—in terms of price and inventory. It had to spread them out evenly throughout the day as opposed to being able to absorb them in near real-time. Sometimes the updates had to wait for three hours and the sellers could not sell anything during that time. MongoDB’s response times also shot up from 5 milliseconds to more than a full second. This compromised the buyer’s shopping experience. Moreover, Snapdeal anticipated its business volume would rise around Diwali and Misra wanted to address the challenge before it impacted business. “We needed our system response times to complete within 10 milliseconds, 95-99 percent of the time— even while our platform processed up to 10,000 reads per second,” recalls Misra. The Project: With 500 percent growth in 2013, Snapdeal realized that it would require a high-throughput and low latency system that could scale from two million to 150 million records, from 10,000 to 30,000 reads per second, and from 30 to 500 writes per second. Misra started out by evaluating the available solutions on four parameters: Cost-effectiveness, the ability to perform concurrent reads and writes, scalability and performance. Most of the systems he reviewed failed to meet at least one of the four criteria. The Solution: But soon he was able to zero-in on an in-memory NoSQL database that met his criteria. First, it performed with predictable low latency with 95-99 percent of transactions within 10 milliseconds. Second, it had the highest throughput. Third,

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Amitabh Misra, VP- Engineering, Snapdeal, revamped the company’s database to perform 95 percent transactions in 10 milliseconds.

it delivered the highest price/performance and, on top of that, it offered the lowest cost solution in terms of both hardware requirements and ease of operations. “None of the other systems that we evaluated were fully viable options for us. It worked magically out of the box,” says Misra. The Benefits: Today, Snapdeal has the ability to scale with the company’s growing business volume. “Now, we can

push through huge price changes while maintaining the same response time experience on the buyer’s side—even with millions of buyers. That’s the biggest advantage,” says Misra. Today, Snapdeal knows that even if its business grows 10 folds its database can scale up to that level without compromising customer experience. CIO Send feedback to sneha_jha@idgindia.com

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ESSENTIAL

technology IMAGE BY MASTERFILE.COM

A CLOSER LOOK AT MOBILITY

Like it or not, commerce increasingly involves keeping tabs on the customer's location. And customers might not always appreciate the attention. Here’s why.

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TrackYou Down BY LAMONT WOOD

LOCATION-BASED SERVICES | Jody Stevenson doesn't know she's been using location-based technology—and doesn't care. "I've been having a ball for almost a year," says the New Jersey homemaker. She enhances her shopping experiences with a service called Shopkick, which gives her loyalty points (convertible to gift cards and cash) just for walking into a participating store. Or, rather, an app on her smartphone (if she has remembered to invoke it) decides that it is inside a participating store, and rewards her with loyalty points (called "kicks"); the amount varies by individual store and the promotional policies of that store. She also gets varying points for scanning bar codes of specific merchandise, whether she buys the items or not. Overall, location-based services use three different levels of accuracy—vicinity to within a block or two (derived from GPS coordinates), presence (establishing that you are inside a given building or store) and department (pinpointing your location within a given store). Shopkick makes use of the presence level, primarily; it's also the level that's demonstrating the most commercial success and producing the most fears about Big Brother-style surveillance. VOL/9 | ISSUE/06

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Vicinity: Search Warrant

Presence: Eyes onYou

With modern smartphones able to locate themselves using the GPS satellite network, applications that allow multiple users to compare their locations for specific purposes are becoming well established. Here on Biz, a mobile app, locates nearby business people one might be interested in meeting, based on their social media entries. "I was in Chicago for a client meeting and was interested in meeting with the people in a large firm located there," recalls Garen Mareno, director of strategic partnerships for a design firm in Los Angeles. So he consulted his Here On Biz app, which locates nearby businesspeople he might be interested in meeting, based on their social media entries. "When I got there, many people from that firm popped up on my Here On Biz radar. I was able to set up drinks and make that first step. Another time I was in Russia and was able to reach out to colleagues I did not know were there," Mareno recalls.

GPS signals typically don't penetrate buildings, so determining presence inside a store requires additional technology. Meanwhile, if the information is shared with other stores, it raises all sorts of questions, notes Evan Schuman, founding editor of the Storefront Backtalk newsletter and a retail technology consultant. "As you enter a gift store they could know you just left a flower store—but what if you were a married man buying for another woman?" he suggests, adding that stores are not sharing such data yet. Shopkick—the service that Stevenson uses—bills itself as the most popular location-based service gathering data at the presence level. Since its introduction four years ago, Shopkick has been based on a box that emits a 21,000Hz tone overlaid with a modulation that is different in each store, explains Cyriac Roeding, co-founder and CEO of Shopkick. A free app on the user's smartphone hears the tone, decodes

The ultimate goal of in-store tracking is differential pricing,based on an ability to identify individual shoppers combined with accumulated information about their backgrounds. The main controversy at the vicinity level appears to involve the question of whether to display the results on a map, since doing so would seem to allow, or even promote, stalking. "We refuse to do mapping; we think it's a security issue," says Nick Smoot, one of the founders of Here On Biz. Another example of a vicinity service is POS REP (Position Report), intended to let military-service veterans find each other. It displays a map showing nearby veterans by branch of service, but the locations are only approximated until a user "pops a flare" indicating a desire to be found, explains Anthony Allman, co-founder.

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the modulation and decides what store its owner is inside of. Mobile app Shopkick gives customers loyalty points—convertible to gift cards and cash—just for walking into a participating store, among other transactions. Adults cannot hear tones higher than 16,000 Hz, and so shoppers are unaware of the signal, Roeding says, adding that while dogs—some of which enter stores as service animals—can hear the tone, it is not loud enough to bother them. The company started shipping the product in 2010, and its ultrasound boxes are now emitting pulses in about 10,000 stores in the US; the company claims

67%

Of consumers finding in-store personalized promotional tactics invasive. SOURCE: CISCO

revenue of $500 million (around Rs 3,150 crore) annually. Roeding says Shopkick users spend 30 percent to 60 percent more than other customers when shopping. For her part, Stevenson says her shopping habits have changed "just a little" since adopting Shopkick. "It might bring new products to your attention that you might not have noticed," she says.

Department: Where AreYou? Beyond knowing that a customer has entered the store, the merchant might like to determine the position of the customer within the store. Traditionally, this has been done with routers that triangulate the strength of the Wi-Fi signal of a customer's smartphone. The Wi-Fi emissions of a phone can be tracked passively, without any need for the owner to opt in, and each phone can be identified uniquely through its MAC address, although the tracking system will not know who owns the phone. There may also be a store app that provides various shopping services, but also encourages the customer to opt in so the store system can identify him or her. "Any meaningful retailer has some effort in this space underway," says retail industry analyst Charles Golvin. The most recent development has been adding Bluetooth low-energy (BLE) detectors, confusingly called beacons, to the triangulating routers. BLE is part of the Bluetooth 4.0 standard used on latemodel smartphones, and permits one-foot detection accuracy with small, inexpensive devices that have a battery life of several REAL CIO WORLD | A P R I L 1 5 , 2 0 1 4

ESSENTIAL technology

years, explains Kevin Hunter, director of product management at Qualcomm Retail Solutions. Passive tracking with Bluetooth is possible just as is done with Wi-Fi, without any need for the phone's owner to opt in, notes Schuman. "It costs 40 bucks, you stick it on the wall, and its batteries last five years," adds Roeding, whose firm is offering BLE as an enhancement for its Shopkick system. "It can also remind you to open the app in the store, if you opted into that; the fact that the user had to remember to open the app was a drawback in the past," he says. The resulting location data is not usually overlaid on a map, as that would involve the additional expense of mapping each store, Hunter adds. The stores are typically content to know what department the user is in, he notes, so they merely need to label the beacons by location.

Privacy is Dead But map or no map, customers are being electronically followed around the store. Storefront Backtalk's Schuman recalls a

facilities assumes the owner knows how. Meanwhile, turning off Wi-Fi may inhibit the owner's ability to make calls from inside large stores, notes Schuman. Roeding says Shopkick protects customer privacy because it, not the retailer, interfaces with the customer and hands out the loyalty points. "We don't supply any names, only aggregate numbers," he says. Hunter says that special features of Qualcomm's BLE beacon promote privacy by emphasizing the need to opt in, and for transparency. After opting in, users can turn off selected features, or opt out entirely and even erase all data about them that has been collected on the device, and do it easily, he claims. Fujitsu's "U-Scan shopper," shown at a trade show in 2005, allows customers to view uploaded shopping lists, check prices and locate items in stores. The monitors also allow retailers to offer loyalty incentives and personalized advertising based on individual shoppers' profiles. Schuman is not impressed. "If you use your phone to make a payment they will

The trick with systems designed to capture iris images at a distance is to use techniques such as "dynamic signage" or flashing alerts to draw the user's attention to the camera,rather than trying to solve image acquisition issues through better algorithms.

74%

Of smartphone users use location-based services to get information based on their current location. SOURCE: LOCAID TECHNOLOGIES

backgrounds. Price tags will be dispensed with, and customers will swipe a product's bar code and be given a price derived from various factors including their "price sensitivity" (that is, their known spending habits combined with their presumed income level). "You may be shown a higher price, because you are less price sensitive, while the next person may get a deep discount since they know that person will not buy it otherwise," Schuman predicts. Analyst Golvin disagrees. "I would be surprised at any attempt at that kind of approach—after all, they [the customers] are walking around with a very powerful communication tool that can provide price transparency." In other words, there is nothing stopping customers from checking prices elsewhere.

Anti-showrooming department store that put up a sign telling customers that their smartphone's Wi-Fi emissions were being tracked unless they went to a website and entered their phone's MAC address to opt out—generating so many complaints it stopped the tracking. "The lesson is that the customers don't like it—or that putting up the sign was a bad idea," he notes. The obvious pro-privacy move of turning off the phone's Wi-Fi and Bluetooth 70

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know who you are every time you walk in until you get a new phone," he notes. "They can pull your history. If you were fond of red sweaters, an associate can approach you and mention a 17 percent sale on red sweaters. What a coincidence!" Beyond that, Schuman says the ultimate goal of in-store tracking is differential pricing, based on an ability to identify individual shoppers combined with accumulated information about their

Indeed, the implications of research from various sources—gathered by Qualcomm and shared by a corporate spokesperson— hint that the retailers are not trying to establish some kind of "1984" or "soak the rich" environment. Rather, they are primarily hoping to counter the practice of "showrooming," where shoppers go to the store to examine a product, and then go home to buy it online at a presumably lower price.

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Around 43 percent of US adults have engaged in showrooming, making the practice a real threat to brick-and-mortar retailers. Even if they are not showrooming, nearly half of customers have been known to check prices on their mobile devices while in a store to make sure they are getting the best possible deal. But consumers are also 46 percent less likely to go comparison shopping if they have a particular retailer's app running on their device. The issue is not going to fade away; some 73 percent of smartphone owners have used their phones while shopping, primarily for checking prices but also to take photos to send to friends or family members. Wal-Mart found that 55 percent of the shoppers who walk into a WalMart store are carrying a smartphone. Those who have a Wal-Mart app on their smartphone enter the store twice as often and spend 40 percent more during their visits as does the "average" shopper. But privacy-conscious or skinflint customers are not the only problems facing retailers when it comes to locationbased services. Hunter at Qualcomm noted that Web retailers can send people into the showrooms of brick-and-mortar retailers (with non-Qualcomm equipment) to "wardrive" the Wi-Fi and BLE routers in the electronics departments of those stores—in other words, use passive devices to collect the network IDs of routers in the vicinity of high-dollar items. The Web stores could then send offers to anyone browsing in those departments, telling them the same products can be acquired cheaper online. One shopper's version of welcome personalized offers might have another person wondering if his favorite big box store has become a Big Brother store. "It's a question of how the retailers communicate the benefit of what they're doing," says Golvin. And for those who remain unconvinced, "Turning off your phone is always an option," he adds. CIO

YourPhone’sStalkingYou MOBILITY | It knows when you are sleeping. It knows when you're awake. And it's not Santa Claus. It is your increasingly smart smartphone, loaded with processors and apps that you acquired voluntarily, with "location services" that broadcast where you are and, in some cases, what you are doing. These services are promoted—and successfully sold—as tools to make your life easier and more interesting. And they do. The apps help you get where you want to go, or let you stay connected with your circle of family, friends, and associates. You can check in with your friends on the way to the hot new club downtown, so they know where you are and you know where they are. With the help of an app, you can find the restaurant your friends have all given rave reviews. Then there is Apple's own description of its latest iPhone M7 co-processor, which notes that it is, "designed specifically to measure motion data from the accelerometer, gyroscope, and compass," so fitness apps can monitor your workouts. "M7 knows when you're walking, running, or even driving," the company says, so that if you stop driving and start walking, its Maps app will switch to walking turn-byturn navigation. "And if your phone hasn't moved for a while, like when you're asleep, M7 reduces network pinging to spare your battery." With apologies to Sting, your mobile device is now in the realm of knowing, in essence, "every breath you take, every move you make." So, along with that easier and more interesting life comes a problem security experts have been talking about for years: If your phone knows, it isn't just your circle of selected friends, associates and family members who know. While teen users may be mostly concerned about their parents monitoring them, the companies that provide those magical conveniences are also collecting that information. And that opens the door to surveillance not only by advertisers but governments as well.

IMAGE BY THIN ISTO CK

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FOR YOUR EYES ONLY

— By Taylor Armerding Send feedback on this feature to editor@cio.in

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endlines RETAIL INNOVATION

* BY LOEK ESSERS

Philips is piloting an intelligent supermarket lighting system that can help shoppers find their groceries based on their location in the store. The LED lighting system can be used by retailers to send locationbased data to customers via an app, Philips said. Besides helping users to locate groceries like avocados, coffee and eggs, the system can also be used to send promotional offers to shoppers, depending on their location in a store. Targeted information and discount coupons can be displayed on phones at a precise position in the store "when shoppers need it most and are most receptive," Philips said. The system uses lighting fixtures that form a dense network that acts as a positioning grid, Philips said, adding that each fixture is identifiable and able to communicate its position to an app on a shopper's smart device. By integrating location services in the lighting system, retailers who want to offer location based services don't have to invest in additional infrastructure, Philips said. Brick-and-mortar businesses are increasingly interested in what customers do inside their walls. Several startups offer indoor location based services and like Philips, they want to help businesses gather data about their customers, like their dwell times at a location, and send promotions to mobile phones.

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Supermarket Smarts