Market Trends Report 2014

MAPPING THE CURRENT PERCEPTIONS, OPPORTUNITIES AND OUTLOOK OF ENTERPRISE DIGITAL DISRUPTION

N I M B U S N I N E T Y C O M M U N I T I E S

S P O N S O R E D

B Y

..TO THE NIMBUS NINETY IGNITE MARKET TRENDS REPORT 2014.

I’ve always found it hugely exciting to work within the world of business technology. Being at the forefront of cutting edge new developments that allow people to create, solve problems and achieve new heights is rewarding in itself; engaging with innovative professionals from world leading organisations that show us how we can take advantage of these trends is truly inspiring.

That excitement continues to escalate, unabated. The ever-increasing pace of development and all-encompassing scope of the new innovative tools and working paradigms at our disposal has created an era of business transformation to rival some of the greatest from history – the proliferation of the PC and globalisation among them.

No longer the reserve of IT teams alone, these developments are bringing huge opportunities – necessities even – for engagement and change among all professions, departments and disciplines. We are witnessing the widespread reinvention of structures, processes, cultures and even business models as organisation seek to ensure they’ll be the victors, rather than the victims, of the transformation taking place.

As the weight and breadth of opportunity has expanded, so has Nimbus Ninety.

I founded the company in 2005 with the ambition of creating a community of professionals that could inspire one another to reap the maximum rewards from emerging enterprise technologies. We began by focusing on business intelligence and performance management (Obis Omni), before creating the first UK professional end-user groups for both cloud computing (The Cloud Circle, 2009) and the new practices in advanced analytics that came with

the emergence of ‘big data’ (Big Data Insight Group, 2011). In 2013, we launched Business Leadership Exchange, a C-Level community which meets once a month for ‘Chatham House’ dinner discussions on various elements of bleeding-edge business issues, as well as sharing insights through a ‘behindclosed-doors’ web portal.

Our communities have collectively grown to over 5,500 members, all of whom are senior executives and project leaders from end-user organisations. As well as the forums that we started with, we now host over 30 masterclasses, dinners, thought leadership summits and networking gatherings per year. We provide our members with introductions to cutting edge technology providers, as well as one another, and we look to facilitate partnerships and collaboration across companies and industries. We also produce regular editorial reports, containing qualitative and quantitative research, granular explorations of emerging practices and changing industries, and interviews and case studies with global leaders.

WHAT IS IGNITE?

Nimbus Ninety IGNITE is a multi-faceted venture which brings all of our individual communities and various activities together. As well as the results and analysis of our survey of business professionals, this report also features interviews and case studies with some of the world-leading speakers from the two-day IGNITE launch event. The event featured a series of inspiring keynotes, masterclasses led by global innovators, demonstrations of the very latest enterprise

EDITOR:

Mark Young mark.young@nimbusninety.com

FOUNDER & MANAGING DIRECTOR: Emma Taylor emma.taylor@nimbusninety.com

CONTACT TELEPHONE NUMBER: 0207 630 1220

REPORT CREATIVE/DESIGN:

DIGITAL CREATIVE DESIGNER:

Registered company and publisher name: Nimbus Ninety Ltd Registration number: 06803745, registered in England & Wales Office address: Minster House, 272-274 Vauxhall Bridge Road, London, SW1V 1BB Registered business address: 16 Northfields Prospect, Putney Bridge Road, London, SW18 1PE

Jordan Constantinides jordan@nimbusninety.com

SPONSORSHIP:

Tilly Seccombe tilly.seccombe@nimbusninety.com

BUSINESS LEADERSHIP EXCHANGE COMMUNITY DEVELOPMENT: Milly Blundell milly.blundell@nimbusninety.com

Nimbus Ninety MARKET TRENDS REPORT 2014

Zeenat Motegheria zeenat@nimbusninety.com Francesca Thornton francesca.thornton@nimbusninety.com

HEAD OF RESEARCH & STRATEGY: Caroline Boyd caroline.boyd@nimbusninety.com

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MEMBERSHIP TEAM

Optic Juice Ltd www.opticjuice.co.uk

Copyright © Nimbus Ninety Ltd 2013 While every action is taken to ensure the information within this report is accurate, the publisher accepts no liability for any loss occurring as a result of the use of that information. All rights reserved. No part of this report may be published or stored in a retrieval system without the written prior consent of the publisher.

IF NO TR EE RWV OI ER W D ? ? ?I ?M N ? ? B? ? U? ? S? ? ? N? ? I? ?N? ?E ? ?T ? Y?

MEMBERS OF NIMBUS NINETY COMMUNITIES, NOVEMBER 2013

technologies and processes, strategy roadmap building sessions for senior executives, dinner discussions and the usual peer networking and meeting environments which are so critical to our culture.

Two more IGNITE events have already been planned for 2014, in May and November, and they will be supported by editorial and dynamic media content. We will also be launching a new service in 2014 which will provide bespoke support and guidance for technology projects, from concept to to implementation and beyond. Watch this space.

Ultimately everything that we do is governed by the needs of our members – that’s how we’re different.

We encourage you to get in touch and let us us know what you would like to see on the agenda.

Our thanks go to our research partners for this report: Logicalis; Rittman Mead; and Smart421, and to all that shared their insights for the survey.

Yours,

Emma Taylor, Founder and managing director, Nimbus Ninety emma.taylor@nimbusninety.com

CONTENTS THE IGNITE MARKET TRENDS SURVEY 6–14/ RESULTS The results of the Nimbus Ninety IGNITE Market Trends Survey of more than 250 senior business and IT leaders 16/ REACTION Reaction to the survey by our report partners: Smart421, Logicalis and Rittman Mead

EXECUTIVE INSIGHTS 18–20/ KEVIN GALLAGHER

CIO, Channel Four 21/ RAYID GHANI

Chief Data Scientist,

Obama for America re-

election campaign 2012 22–23/ ANDY WILLIAMS CIO,

Save the Children

JASMINE SKEE

Marketing Director,

Live Nation

MARK RIDLEY Director

of Technology, Reed.co.uk 24/ ROSS MCKEAN

Partner, Olswang

PARTNER CASE STUDIES AND THOUGHT LEADERSHIP 26–28/ SMART421 Case studies on the company’s work in cloud-based big data, disaster recovery and service transition with Quotemehappy.com, Haven Power and National Rail Enquiries.

29–31/ LOGICALIS James Thompson, Business Analytics & Information Management specialist, says transformation will make the CIO critical to new models of business innovation.

32–34/ RITTMAN MEAD Jon Mead, Co-founder and Managing Director of Rittman Mead, explains why big data is a new paradigm for the enterprise, and how technology is both the enabler and driving force.

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INTRODUCTION

WHY DIGITAL DISRUPTION?

N I M B U S

N I N E T

Y

CAROLINE

BOYD

HEAD OF RESEARCH AND STRATEGY, NIMBUS NINETY

INTRODUCTION TO THE NIMBUS NINETY IGNITE MARKET TRENDS REPORT 2014

T

he digital age is a dynamic and exciting time for consumers and enterprises – and for Nimbus Ninety members in particular. Over the past five years we have all borne witness to the incredible changes in our society and home and working lives through disruptive innovations like cloud computing, big data analytics, mobile and social networking.

Often starting out in the consumer space, these innovations quickly make the jump to the enterprise world where, with the benefit of investment, their development and scope for changing the way we live and work escalates rapidly. But recently it feels like the pace of this development is hurtling out of control and it’s a struggle for even the most digitally savvy leaders to keep up. The rules of the game have changed inexorably as the costs of changing entire industries have shrunk to virtually zero. The impact of the convergence of this ‘perfect storm’ of factors (which can be seen on any UK high street) has led analysts and journalists to coin the phrase ‘digital disruption’. Not every emerging technology will alter the business landscape – but some will have the potential to significantly disrupt the status quo, wiping out established business models and reshaping the competitive landscape.

It’s going to be a perilous journey to competitive advantage in the digital age and only those with winning strategies will succeed. Traditional business models and approaches just don’t cut it in this agile new world. New policies and procedures will need to be aligned in such a way as to foster and enable flexibility and innovation.

Leaders will need to adapt faster and organisations will need to place digital at the heart of their business strategy. Organisations will need to shortlist and prioritise the key disruptive tools and the right mix of technologies that will have the greatest business impact – and then find a way to effectively manage and integrate these often disparate tools and channels.

These are just some of the issues that we will explore in our Nimbus Ninety IGNITE Market Trends Report which aims to uncover what senior executives really think about the threats and opportunities of digital disruption and the steps they are taking to harness or react to the changes. The results of our IGNITE Market Trends Survey are extremely insightful and reveal the true extent of the disruption already facing many of our leading industries and organisations.

Our thanks go to the global leaders and our research partners who have contributed their experiences and thought leadership within the editorial articles beyond the survey, and to all that filled out the survey itself.

We hope you find the report a useful tool in providing best practice, inspiring you with ideas, in challenging your perceptions and in benchmarking your strategy against your peers.

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INTRODUCTION M A R K E T

MARKET TRENDS SURVEY 6–14/

THE RESULTS OF THE SURVEY

Graphical illustrations and overview analysis of the Nimbus Ninety Market Trends Survey of over 250 senior business and IT leaders

16/ MARKET TRENDS REPORT RESEARCH PARTNER REACTIONS

Responses to the survey by the three Market Trends

Report research partners: Smart421, Logicalis and Rittman Mead

S U R V E Y

MARKET TRENDS SURVEY

NIMBUS NINETY IGNITE MARKET TRENDS REPORT 2014

T R E N D S

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Fig 1/ Respondents by employee numbers

SURVEY

MAPPING THE CURRENT PERCEPTIONS, OPPORTUNITIES AND OUTLOOK OF ENTERPRISE DIGITAL DISRUPTION

HEADLINE FINDINGS Digital disruption is more than just hype – 76% agree the changes are as significant as the likes of globalisation and the proliferation of the PC Almost half (47%) of organisations say their industries are currently undergoing disruption A third (32%) are having to fundamentally change their business models or proposition as a result of the developments Only a quarter (27%) are fully prepared for the opportunities and threats of digital disruption, but 66% say their efforts to cope with it will position them for growth Marketing, PR and Comms is the biggest line-of-business department to benefit from digital disruption (53%) Mobile dominates in the list of emerging technologies, platforms or processes to have the biggest impact (Mobile devices, 78%; Mobile Internet 75%; Mobile applications 72%).

Financial restrictions are the most oft-cited barrier to implementing new technologies (41%). The skills gap (27%) and security (13%) were noted surprisingly less often.

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he Nimbus Ninety Ignite Market Trends Survey was conducted over September and October 2013.

It received 262 responses from senior executives and project leaders at blue chip to SME organisations across the private, public and third sectors.

The respondents were qualified as endusers – as opposed to suppliers – of business technologies. They are all responsible for running or overseeing technology projects within their organisations, or have a significant influence over which technologies are implemented.

Figures 1 – 3 illustrate the comprehensive range of organisations represented within the survey response, by turnover, employee numbers and industry sector.

1 -10 11 – 100 101 – 500 501 - 1,000

12% 11% 13% 6%

1,001 - 5,000 5,001 - 10,000 10,001 - 20,000 20,000+

19% 10% 4% 25%

Fig 2/ Respondents by annual turnover

£0 - £25m £25m - £100m £100m - £500m £500m - £2bn

27% 8% 18% 13%

£2bn - £10bn £10bn - £25bn £25bn - £50bn £50bn+

14% 8% 4% 8%

R E S U L T S MARKET

Fig 3/ Which industry sector does your organisation primarily operate within?

15% 11% 10% 10% 8% 7% 6% 5% 4% 3% 3% 2% 2% 2% 2% 2% 2% 2% 1% 3%

IF WE DO NOT ADAPT, WE WILL NOT CONTINUE TO EXIST. NEW, NICHE PLAYERS CAN GAIN MARKET SHARE VERY QUICKLY BY MAKING USE OF DIGITAL CHANNELS TO CREATE A PULL FOR THEIR PRODUCTS” Head of Analytics Innovation, blue chip pharmaceutical company

TRENDS

SURVEY

THE PERCEPTION OF DIGITAL DISRUPTION

T

he worlds of business and technology are both ripe breeding grounds for hype.

The current wave of ‘digital disruption’ encompasses not just one but a multitude of emerging technologies, platforms and processes aimed at delivering increased business functionality and efficiency. Those developments are creating closer relationships between IT and line-of business departments than we’ve ever seen before, in some case amalgamating the two traditionally distinct areas of the organisation completely.

It would be reasonable, therefore, to suspect that ‘digital disruption’ – one of the year’s undoubted biggest buzz terms – would spawn hype in abundance.

But respondents to the IGNITE Market Trends Survey certainly see that there’s more to digital disruption than hype alone. The majority (77%) see digital disruption primarily as ‘an opportunity’. Only four per cent see it primarily as ‘a threat’ and only two per cent see it as either ‘just hype’ or ‘none of our concern’. The remaining 15% see it as ‘a challenge’ (see fig.4).

In fact, almost half (47%) say their industry is in the process of being significantly disrupted by the current wave of emerging digital technologies, while a third (33%) report that it already has been (see fig.5) Respondents were also asked whether or not they see the current developments in digital enterprise technologies as constituting ‘disruption’ on a similar scale to previous examples of significant business change. The examples of globalisation, the expansion of the European Economic Area and the proliferation of the PC were offered as benchmarks. More than three quarters (76%) agreed that it does, while the majority of the remainder see the current developments as just ‘garden-variety evolution’. Only three per cent say ‘nothing is changing’.

However, fewer small companies than their larger counterparts identify the current changes as significant disruption.

Analysing the responses by annual turnover, only 66% of those in the £0-25m bracket and 53% of those in the £25m-100m bracket say the changes do indeed constitute disruption on a par with those previous instances. This compares with 90% in the £500m-2bn bracket and 81% of the £2bn+.

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Fig 4/ How is digital disruption viewed within your organisation?

An opportunity 77% A challenge 15% A threat 4%

Just hype 2% None of our concern 2%

Fig 5/ Do you think that your industry has been, or will in the future be, significantly disrupted by new technologies?

HOW ORGANISATIONS SEE THEMSELVES

T

he increase in the use of technology that we have seen in recent years is still gaining momentum, and its scope is widespread. Almost half (48%) of organisations rely on technology more today that they did just one year ago (fig. 6).

However, there are signs that companies may be struggling to keep up with the pace of developments. Little more than a quarter (27%) say they are fully prepared for the opportunities and threats that the current wave of digital disruption presents. In addition, more organisations identify themselves as susceptible to digital disruption (37%) than as a driver of it (27%) – though of course both can apply to a single organisation.

Many are having to make significant and fundamental changes to their organisations as a reaction to the current developments (fig. 7). A large majority (82%) note that digital disruption is affecting the way their products and services are delivered and only slightly less (74%) report the same for the way that they communicate with their customers. Almost half (43%) are having to alter their organisational structures to accommodate the changes and, perhaps most tellingly, almost a third (32%) are having to change their core business model or proposition.

Respondents are confident that their efforts could eventually pay dividends though, with 66% stating that new technologies are positioning their organisations to grow. On the flipside, 52% concede that new technologies are also making it easier for competitors to challenge them.

Fig 6/ Which of the following statements accurately describe your company? Please select all that apply

48% 39% 37% 27% 27% It is in the process of being disrupted It already has been disrupted

It will be disrupted over the next two years It will be disrupted, but not for at least two years Disruption could occur at any time with little warning It won’t be disrupted for the foreseeable future

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Nimbus Ninety MARKET TRENDS REPORT 2014

47% 33% 7% 6% 5% 2%

4%

R E S U L T S MARKET

TRENDS

SURVEY

Fig 7/ How is digital disruption affecting your organisation? Please select all that apply

82% 74% 66% 54% 52% 43% 40% 34% 32%

TOOLS AND PROCESSES

I’M NOT CONVINCED WE’RE FINDING TOTALLY NEW CUSTOMERS. A NUMBER OF SALES WILL BE TRANSFERRED BETWEEN DIFFERENT CHANNELS, BUT PEOPLE ONLY HAVE THE SAME AMOUNT TO SPEND IN TOTAL. LOYALTY IS ALSO HARDER TO ACQUIRE AND MAINTAIN WHEN IT’S NOW SO EASY TO FIND ANOTHER PURCHASING OPTION” Information Analytics and Innovation Manager, nationwide high street retailer

M

obile is certainly the topic de jour at the moment where emerging disruptive technologies are concerned. Mobile devices (78%), Mobile Internet (75%) and Mobile applications (72%) are the three most widespread emerging technologies, platforms or processes to be disrupting the way organisations work (fig.

8). This level of take up is broadly similar across the spectrum of companies, by size and industry sector. Cloud computing is also high on the agenda (68%). It is highest, in fact, for companies at the smallest end of the turnover scale (£0-25m, 80%) who benefit from the economically attractive entry points, scalability, and their freedom from legacy infrastructure concerns in implementing it (see barriers, fig.11, pg13).

The oft-cited democratisation of big data and advanced analytics – supported by pay-as-you-go computing, open source technologies and intuitive, easyinterface software – does not appear to have materialised fully as yet. There is a steady decline in line with turnover in the percentage of companies that are engaging in the processes, from 61% of those in the £2bn+ turnover bracket to just 29% in the £0-25m bracket.

So-called smart platforms such as telematics, intuitive machine learning, and smart materials are having the least influence at present. However, adoption rates for these technologies are expected to increase up to five-fold over the next three years, while all other technologies will decrease in adoption over the same time frame as they become normalised.

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Fig 8/ Which new emerging business technologies, platforms and processes are currently disrupting the way your organisation operates, and which will do so within the next three years? Choose as many answers as appropriate.

£0-25m £25m-100m £100m-500m £500m-2bn

£2bn+ All orgs now All orgs in three years

* Results by turnover represent current disruption levels.

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R E S U L T S MARKET

In terms of processes, internal collaboration (54%) and external communications (52%) are the most widely improved by the current wave of emerging technologies (fig. 9). However, a broad spectrum of undertakings has been improved overall. The use of collaborative and flexible technologies has served well in operational process efficiency drives (49%), something that is also inextricably linked to the increased analytical functionality of performance monitoring exercises (41%).

Organisations have found that they have been able to identify and reach new customers more commonly (45%) than to upsell to existing ones (36%), with the latter having historically been seen as a more efficient and profitable exercise.

In significant numbers, the larger companies have also used the new processes and tools and their disposal to redevelop their supply chains (27% among the £2bn+ turnovers; 36% £500m-2bn). This is understandably of little concern among the SMEs though (8% £0-25m; 6% £25-100m), as they do not have the same complexity among their supplier base and therefore direct their resources towards areas in which they have more to gain.

The advent of experimenting and testing – one of the key constituents of the agile methodology that has been enabled on a mass scale by developments like scalable cloud computing and analytics-related technologies and processes – is also commonly being employed (37%).

TRENDS

SURVEY

Fig 9/ Which of the following undertakings has your organisation been able to improve through the use of disruptive new enterprise technologies over the last two years? Please select all that apply.

54% 52% 49% 48% 45% 41% 38% 37% 36% 34% 26% 25% 20% 17%

BENEFACTORS AND BARRIERS

PREVIOUSLY, DEVELOPMENT CONTRIBUTED TO PARTIALLY CHANGED BUSINESS AND TECHNOLOGY OPERATIONS. THE CURRENT DEVELOPMENTS NOT ONLY ACCELERATE THIS CHANGE BUT FUNDAMENTALLY ALTER THE SHAPE OF ORGANISATIONAL DEPARTMENTS GOING FORWARD” Global Head of Technology, large manufacturing company

IT

is unsurprisingly the department of the organisation cited most often as having the most to gain from digital disruption (fig. 10).

Since digital disruption is fundamentally underpinned by technology, it stands to reason that those with the biggest controlling stake in it and the biggest understanding of it would be perceived to be the biggest benefactors. Yet, with respondents able to choose up to three areas, that it was selected by only 57% of respondents perhaps serves to indicate that however technologically focused – dependent, even – organisations become, that technology must serve a business need. Technology for technology’s sake is not only decadent, but could serve to be counterproductive with the added complexity it brings and the inefficiencies that arise from mismanagement.

Essentially then, technology must benefit the line-of-business activities. In line with the other answers to the survey, ‘marketing, PR and communications’ (as a single area) was noted as the business department that stands most to gain (53%), followed by operations (43%). Research and development – benefiting from the progressions in insight and test and learn capabilities offered by advanced analytics and scalable cloud – also scored highly at 35%.

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Fig 10/ Which area of your business stands to gain the most from disruptive new business technologies? Please select up to a maximum of three WHILST I AM SURE

57% 53%

THAT TECHNICALLY CLOUD COMPUTING COULD WORK IT WOULD BE HARD TO EXPLAIN THAT RISK TO OUR CUSTOMER BASE”

43% 38% 21% 35% 16%

Head of Data Management, blue chip banking company

7% 7% 4% 1%

Financial restrictions are commonly held to be the biggest barrier to implementing new emerging technologies, and they are the most widely cited obstacle in this survey (41%) (fig. 11). Interestingly, the much discussed skills gap that has emerged with the rapid development of new technology areas was only noted among the three biggest barriers by 27% of respondents. Likewise, security was surprisingly cited by just 13%. This might suggests that organisations feel they can work around these issues; while they are certainly concerns, they may not be the stumbling blocks that many suppose they are. As far as the skills issue is concerned, this sentiment is seemingly backed by the response to the question of the most important factors in the successful adoption of technology (fig.12, pg14).

However, an alternative reading might be that organisations are simply not exploring what the barriers are beyond the first obstacle of not having the financial resource to embark upon the project in the first place.

If that obstacle were to be circumvented, the skills and security issues might well prove to be bigger concerns than respondents initially give weight to.

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BY GOING SOCIAL AND MOBILE WE ARE GOING TO DISRUPT THE LANDSCAPE AGAIN, BUT NOT AS MUCH AS INTRODUCING ONLINE TO AN OFFLINE WORLD” CEO, SME Internet gaming company

Exploring the barriers within different turnover brackets throws up some interesting points of differentiation. The financial barrier reduces steadily as the company size increases (50% for £0-25m turnover to 34% £2bn+), as does the problem of lack of time (50% £0-25m; 22% £2bn+). The issue of governance, risk and compliance follows the opposite trajectory (13% £0-25m to 34% £2bn), tempered only slightly by an apparent anomaly at the £500m-£2bn level (18%). Anomalies aside, this is all fairly in line with the perceptions you would expect.

However, less apparent is why the skills barrier appears to be most prevalent at the mid-range company level (38% £100m-500m), and decreases relatively consistently either side (29% £500m-2bn, 23% £2bn+; 25% £25m-100m, 21% £0-25m). The mid-range companies may be suffering disproportionately from the concerns that come with growth such as organisational sprawl, legacy processes and regulation, without the financial backing that the larger companies have to appease these issues.

Meanwhile, the requirement to prove ROI appears virtually non-existent at the bottom of the turnover scale (4% £0-25m) but, in the context of the survey, a major concern at the top end (31% £2bn+).

R E S U L T S MARKET

TRENDS

SURVEY

Fig 11/ Which new emerging business technologies, platforms and processes are currently disrupting the way your organisation operates? Choose as many answers as appropriate

All 0 – 25m 25m – 100m

100m – 500m 100m – 500m 2bn+

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R E S U L T S M A R K E T

SIGNING OFF

A

fairly even split was registered in whom within the organisation signs off technology projects between the CIO (32%), CEO/MD (29%), IT director (29%), individual department heads (29%) and CTO (26%) [fig. 13]. This reflects the growing stake that lineof-business employees are taking in technology projects, both due to the increased influence that technology holds over business processes and – in many cases – the ease of access, implementation and operation.

Reiterating the earlier point around which business departments stand the most to gain, aligning projects to a business case (55%) was adjudged to be the biggest factor in the successful adoption of emerging technologies (Fig. 12). That the ability to iterate, learn and adapt (45%) and being flexible to fundamentally changing the organisation where necessary (40%) both scored highly among the factors reinforces the suggestion that a significant number of companies are of the mind-set that they may need to fundamentally alter their organisations so as not just to implement new technologies but to turn digital disruption from a threat to an opportunity.

T R E N D S

S U R V E Y

Fig 13/ Which of the following factors do you consider to be most important in your successful adoption of emerging technologies? Please select up to three

55% 51% 45% 40% 37% 27% 27% 20% 13% 12% 9% 3%

Fig 12/ Who within your organisation signs off technology projects? Please select all that apply

32% 29% 29% 27% 26% 19% 13%

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Nimbus Ninety MARKET TRENDS REPORT 2014

REALISING THE BUSINESS BENEFITS OF TECHNOLOGY INNOVATIONS

Nimbus Ninety is a group of interactive business technology focused communities.

We provide leadership and actionable insight for senior level business and technology leaders across the UK and Europe.

Nimbus Ninety communities include: Obis Omni The Cloud Circle Big Data Insight Group

Through our thought leadership events and market analysis reports, we help our members to understand and realise the business value proposition of technology.

Business Leadership Exchange

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CALL ON 0203 598 2237 or EMAIL info@nimbusninety.com WW W. NI M BUSNI N ETY.CO M

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CONCLUSIONS M A R K E T

T R E N D S

R E P O R T

REACTION REACTION TO THE SURVEY

BY THE NIMBUS NINETY IGNITE MARKET TRENDS REPORT RESEARCH PARTNERS ROBIN MEEHAN, CTO AND DIRECTOR OF PRINCIPAL CONSULTANCY

T

he acceleration of disruptive change is the key theme from this year’s study – acknowledged by a staggering 97% of the companies surveyed – and echoing what we are seeing amongst our customers. / Enterprises are rushing to meet the demands of mobile adoption as buying behaviour changes with consumers ‘inviting’ enterprises into their sitting room via the tablet device. Social media gives open access to product reviews, making independent C2C communications the primary channel for feedback. / Cloud too is set to release its potential, with a large number seeing it as a key investment area. Now recognised as a commercial game changer and not just a technology play, it is set to meet the needs of the information explosion and the speed of change.

However, be warned: those organisations without a coherent IT strategy are likely to suffer as competitors rapidly embrace these new disruptive technologies.

For established organisations, being able to harness and exploit these new disruptive technologies brings commercial opportunities, allows new business models to surface and creates new forms of data. Monetising your enterprise assets will depend on the degree to which you are willing and able to integrate data back into the IT estate you already work with.

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Nimbus Ninety MARKET TRENDS REPORT 2014

JAMES THOMPSON, SALES DIRECTOR & GERRY CARROLL, HEAD OF MARKETING

I

t is no surprise to us to see mobility as the most disruptive force – it is an area which will fundamentally change the way that businesses work and the way they define themselves culturally. Consumer technology drives uptake into the business world and organisations recognise that they have to embrace it and change their organisational structure to support it.

Mobility enables a far more customer-centric model, allowing you to gain granular insight to inform your products and services and to deliver them when, where and how the customer or business model requires.

The way you support customers, the way you operate and ultimately your profitability is all now dependent on the IT infrastructure.

But, as we also note from the survey, the line-of-business functions have to drive and own your innovation and business strategy as they have the touch points with the customer.

Therefore you need to have a close alignment between business objectives and IT enablement.

If IT can enable efficient and effective business insight then the business will make the right choices.

It’s then all about providing the elasticity to accommodate changes and reorganise with a rapidly iterating business model. That’s why we also see cloud computing remaining, alongside mobile, at the forefront of organisations’ technology strategies.

JON MEAD, CO-FOUNDER AND MANAGING DIRECTOR

T

he effect of digital disruption in 2013 is clearly a reality and not hyperbole.

Organisations are considering it to be a fundamental change in how they do business, and the vast majority see it as a positive opportunity.

The biggest change reported is the way products and services are delivered, which has enabled growth for two thirds of the respondents.

However there is also a feeling that this could lower barriers to entry and make it easier for competitors to challenge them. The majority of companies will increase their spend on cloud, big data and mobile technologies.

Also significant is how organisations communicate with their customers. Despite a greater amount of communication and data about customers only a third of organisations have been successful at up and cross selling additional products and services.

Mobile technologies are seen as the single biggest enablers of digital disruption with mobile devices driving both internal and external communication between organisations and their customers and also changing how products and services are consumed.

From Rittman Mead’s perspective we are starting to see a tipping point in organisations, firstly, investing in these projects and technologies, and secondly, in them becoming embedded in their core operating model.

INTRODUCTION E X E C U T I V E

EXECUTIVE INSIGHTS 18–20/

EXECUTIVE INTERVIEW

21/

BIG DATA BEST PRACTICE TIPS

Kevin Gallagher, CIO, Channel 4 Rayid Ghani, Chief Data Scientist, Obama for America re-election campaign 2012

22–23/

LEADERSHIP SPOTLIGHTS

24/

SECURITY COLUMN

ANDY WILLIAMS CIO, Save the Children JASMINE SKEE Marketing Director, Live Nation MARK RIDLEY Director of Technology, Reed.co.uk

Ross McKean, Partner, Olswang

EXECUTIVE INSIGHTS

NIMBUS NINETY IGNITE MARKET TRENDS REPORT 2014

I N S I G H T S

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TELEVISION HAS GONE THROUGH SOME FUNDAMENTAL C HAN GES OVER THE 30 YEARS SIN CE C HANNEL FOUR WAS FOUNDED. BUT ADOPTIN G THE SAME APPROAC H TO INN OVATION BEHIND THE SCENES AS IT DOES ONSCREEN HAS HELPED THE COMPANY TO THRIVE. KEVIN GALL AGHER EXPL AINS HOW THE COMPANY’S CULTURE HAS BEEN IT S BEDROC K.

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hen Kevin Gallagher joined Channel Four Television Corporation in 1999 as Head of Systems Delivery, the company was, like the vast majority of media outlets, at the very start of its digital journey.

Back then analogue was still the primary reception method for the majority of viewers. Indeed, digital delivery of Channel 4 had been introduced just the year before, at which point it had been joined by its first stable mate: the then £5.99 per month subscription service FilmFour.

The absolute cutting edge in web dynamism at that time was probably live chat, for those that could keep up – many households still struggled with loading heavy image-based pages in any sort of decent time.

Nearly a decade-and-ahalf on, much has changed.

Analogue TV no longer exists, and Channel Four’s portfolio has been expanded to six

different digital television channels (not counting the various ‘plus ones’ which repeat schedules an hour later), a further six digital radio stations, and its catch-up service 4OD. The website has been joined by a host of consumer applications which not only allow users to watch what they want, when they want, wherever they want, but also allow them to interact with programming too, through multiple devices, platforms and media types simultaneously. We’ve reached a state that would have been inconceivable to most people pre-turn of the millennium.

Yet Kevin – who has now spent four years as CIO after almost ten in his previous role – still feels TV has had it slightly easier in terms of digital disruption compared with others in the media industries.

“There’s something about the nature of TV that we haven’t been hit quite so dramatically,” he ventures.

“People are finding completely different ways to get their music

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and publishing content whereas with TV the incumbent dynamic has survived a lot of the disruption. A large part of TV consumption is still very much about a shared experience – people still come together around the television set in a social environment in the same way as they have for decades.

“We are far from complacent, and we have aggressively pursued a digital strategy around content distribution and viewer engagement. During this time there have been a number of new entrants and the battle for great content and viewers’ time has become ever more competitive. But we have had the opportunity to start diversifying in a planned way, rather than just seeing our business model drop off a cliff. The end result is still the same – we go from being a linear broadcaster to a multi-product company in terms of how we get our content out – but we’ve done it more or less on our own terms.”

The fact that the core paradigm has endured has allowed the key players in the television industry – the likes of Channel Four, the BBC and Sky – to build additional usage and revenue streams rather than cannibalise their existing ones.

The consumption of television via personal devices is a supplement to, rather than a replacement of that shared experience that Kevin alluded to. Online-only television, meanwhile, has up until now been unable to match the established producers in terms of scope or appeal, though the likes of Netflix are certainly looking to challenge this with their original programming.

While TV has been somewhat fortuitous in having enjoyed this element of protection, does Kevin think that there are lessons that other industries can take from it?

CHANNEL FOUR PROFILE

“The ability to adapt is key,” he says. “Even larger less agile organisations need to appreciate that this really is the key to success in this age. We have definitely adapted the way we work as the social and economic landscape has changed, as it has for everyone.

“But I think having a solid base from which to start is also critical, and it’s not just about ways of working. It’s also our approach to the way we develop and retain our staff and how we value them. Really, they are the core that is ‘The Channel’. You also have to be open to innovation wherever it may come from.”

EYES ON THE PRIZE

SOURCE: CHANNEL FOUR TELEVISION CORPORATION

FOUNDED: 1982 C HANNEL S: CHANNEL 4, 4SEVEN, FILM4, E4, MORE4, 4MUSIC, HEAT, KERR ANG!, KISS, MAGIC, SMASH HITS!, THE BOX REMIT : Channel 4 is a publicly-owned, commercially-funded, not-for-profit public service broadcaster and has a remit to be innovative, experimental and distinctive. Its public ownership and not-for-profit status ensure all profit generated by its commercial activity is directly reinvested back into the delivery of its public service remit. As a publisher-broadcaster, Channel 4 is also required to commission UK content from the independent production sector and currently works with over 400 creative companies across the UK every year.

ONLINE USER BASE: Channel4.com has nine million registered users, including 1 in 3 of all 16-24 year olds in the UK. The database continues to grow at a rate of 10,000 new registrants per day.

More than 60% of 4oD (on demand) views are from logged in, registered viewers.

Lucky or not, having an opportunity to control one’s own destiny is one thing, doing so effectively and sustainably is quite another. Channel Four’s success in that respect, according to Kevin, has been achieved by extending the central philosophies that guide its programming output to all other areas of the business.

Ever since becoming the UK’s fourth terrestrial TV channel, the company has sought to produce content that is first in the market and pushes boundaries. It has now made that mantra a key driver in the way that it sells advertising, the way that it utilises viewer

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data, the way that it develops and distributes supplementary products, and everything else behind the scenes.

In its programming, for instance, the organisation has a penchant for working with small, independent companies that are looking to break the mould. That model has now been applied to technology commissioning too, and it is helping Channel Four to circumvent some of the oft-cited barriers to keeping pace with the ever quickening technology development cycles.

“When new technologies emerge, you naturally get skills gaps,” explains Kevin.

“Sometimes that’s just the time that it takes people to get up to speed with variations in what they already know, sometimes it is a fundamentally new area that involves a whole new set of proficiencies.

“You have to work out how you’re going to fill those gaps. Do you employ new people, do you continually retrain your existing people, or do you go and find some niche external players to partner with? The answer is a mix of the three, but the only way to really diversify quickly is to have access to a lot of different partners with different specialities. Generally, the smaller companies and start-ups tend to be the ones that come up with something fresh and disruptive, and they are also open to working with you to find out how you can best complement each other and react quickly.”

As well as supporting emerging innovators and benefiting from cutting edge advances, this partnering strategy allows the in-house technology team to apply their talents to the core proposition. The team still works on certain new beta technology products and performs data analytics to measure the success of initiatives which can then inform tweaks to various parts of the strategy. But they are also free to help and oversee programming projects that leverage technology for the modern, multi-platform dynamic which is fast becoming the norm.

Says Kevin: “We enable people to make ‘new world’ types of content by removing the technology barriers and problem solving on their behalf. The play-along feature for The Million Pound Drop has been a hugely successful example of that. Another that we were very proud of was our D-Day: As It Happens event, where we played out D-Day over 24 hours through the experiences of seven people that were actually there, as if it was a live news story. It was a fabulous mixture of traditional research methods along with modern technology, social media and TV complementing each other.

“That undertaking wouldn’t have been possible unless our in-house technology team was in a position to provide project management and technical governance support in making sure it’s all secure and that

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-Day: As It Happens’ was a multi-platform initiative produced for Channel Four by Windfall Films. The event played across TV, Internet and social media, with the experiences of seven people that were actually there, reported as a live news story over 24 hours.

it is all going to perform live. Working with smaller content producers has traditionally entailed providing access to studios or linking up companies with our network of professionals. In the new technology-focused world, it’s also about helping those companies to utilise things like public cloud, hosting, real time analytics and social media links.”

PICKING YOUR BATTLES

Clearly in a digitally dominated industry like TV there are a multitude of new avenues to explore. And with its commitment to being first in the market, proof-of-concepts are a luxury rarely open to Channel Four. How then, does the company decide which new opportunities to focus on?

“Prioritisation is a real challenge,” Kevin agrees. “We know that we can’t just focus on our existing business models because we’ll become another Kodak. But we also know that we can’t do everything all of the time. Obviously we look at the return on investment, and we use our data analysis as a base for the business case and for deciding what we do first. Much of it is about balancing the relationship between the creative teams and those that focus on profit and loss. But sometimes you just have to have faith, and you have to accept that you’ll go down a few blind alleys from time to time.”

The data proposition, he says, is actually something of a double-edged sword. The company has invested a huge amount of effort in recent years into creating reasons for people to sign in to its online features so that it could profile its audience base and their habits. That enables it to link content up to advertisers more effectively, which you could argue serves both the consumer and the commercial partner to some extent. Partly to that end, Channel Four recently launched an app called 4Now which offers live second screen information and third party links related to TV shows as they are broadcast.

Channel Four also knows that it has a great opportunity – a responsibility even – to ‘listen’ to its customers and allow them to direct development of content. This is achieved through direct communications, by analysing what its users do with the products and content, and by monitoring what they say about them through social media.

But Kevin warns that there is a risk to innovation if you just listen to what people say they want, rather than trusting the creativity and intuitiveness of industry professionals. “It’s an interesting balance,” he says. “A certain amount of research is of course healthy from a consumer sovereignty perspective, but on the other hand you’re at risk of simply regurgitating the things that have been successful in the past.

“I was asked recently why we don’t just do what Netflix did with House of Cards [commission productions based on big data analytics of the user base]. But actually Channel 4 is about being innovative and trying out new things. We really trust our commissioning editors and artists to come up with ideas that will be a hit, and that’s often about producing things that people don’t necessarily know that they want. If we just pander to people we’ll lose our edge and we’ll just dumb down.”

That would of course be completely contradictory to the company’s image and the strategy that has served it so well over the last three decades. And there in lies the challenge.

“That’s the continual consideration, really,” Kevin summarises, “not just for us but for everyone: how do you grow and evolve in line with societal trends while staying true to your fundamental strategy?

“We are working at a time of enormous upheaval but we have a great opportunity to be involved in redefining our industries.

There’s no roadmap, and that’s scary but it’s also hugely exciting. There’s also no beginning and end, we all just have to carry on working at it and see where it takes us along the way. But you have to keep in mind who you are and what you stand for. I think if you have that right in the first place then it doesn’t have to change.”

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INSIGHT INSIGHT RAYID GHANI / CHIEF DATA SCIENTIST, OBAMA FOR AMERICA 2012 / FOUNDER, ERIC & WENDY SCHMIDT DATA SCIENCE FOR SOCIAL GOOD FELLOWSHIP, UNIVERSITY OF CHICAGO / CO-FOUNDER, EDGEFLIP

IN N OVEMBER 2012, BAR AC K OBAMA CONVIN CIN GLY DEFEATED HIS OPPONENT MITT ROMNEY AND WAS RE-ELECTED US PRESIDENT. INSTRUMENTAL IN THAT VICTORY WAS THE ANALYTICS PROGR AM RUN BY THE OBAMA FOR AMERICA 2012 CAMPAIGN TEAM, LED

BY CHIEF DATA SCIENTIST R AYID GHANI.

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ayid and his team used data to inform decisions across virtually every department of the re-election campaign, with the express aim of persuading the electorate to vote Democrat. Specifically, they combined data with field experiments and statistical modelling to score and prioritise individuals on a personal basis, identifying those that should be contacted in-person, by phone, social media, and direct mail across the country. They also used data to inform the publicist teams on how to present Obama and his opponents in the media.

The campaign has since become one of the most oft-quoted proof-of-concepts for advanced analytics and has played a huge part in the propelling of ‘big data’ into the mainstream spotlight.

Following the campaign, Rayid joined the University of Chicago where his focus is on helping governmental bodies, non-profits and their partnering organisations to build analytical models and prototypes for solving ‘social good problems’. As part of that, he founded the Eric & Wendy Schmidt Data Science for Social Good Fellowship, working alongside the Google Executive Chairman to bring aspiring young data scientists from around the world to Chicago to work on education, healthcare, energy, disaster relief, city services and public safety problems.

He has also co-founded Edgeflip – a private venture which aims to help supporters of social issues become advocates and to aid fundraising through digital tools and social media.

RAYID’S RULES Nine rules for embedding big data within your organisation

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Small iterations, not big transformations. Start small, prove small successes, and then grow. If you’re advocating for evidence-based decisions, set an example and show evidence to aid your cause.

Be metrics-driven – but the right metrics. Metrics are an excellent incentive and integrate groups when used effectively. But organisations often just track metrics that are easily measurable. Resist that temptation.

Use the metrics that help you act and change decisions.

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Invest in integration. Integrate data across departments as well as channels (onlineoffline for example)

Position tech talent at the heart of the business. Hire smart data, analytics and tech people but don’t isolate them in a dark, windowless room. They must understand, appreciate, and be immersed in the business, or their ideas won’t be useful or actionable.

You need to balance the contextual knowledge they need with the freedom to experiment and try things out.

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Embed analytics tool in business processes.

Nobody will adopt brand new ways of working when

they’re busy doing their day-today jobs. Make sure the new tools you develop not only solve real problems but are also embedded into the existing processes being used by the people involved with those particular issues.

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Multichannel on-message.

Each channel has its own quirks but make sure the data and analytics powering those actions are unified and the feedback loop exists. Integrating the data is good but integrating the intelligence behind the channels is the key.

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Utilise personalisation. Data enables you to personalise at scale. Your audience expects personalised communications and by interacting with an organisation they provide the data to make it happen.

Experiment, test and learn.

Democratise the testing culture but centralise the prioritisation of the experiments according to payback, effort and potential payoff.

Know the limits of your data. Data is power and you should be data driven.

But equally important is the ability to know when you don’t have the data to know or take action.

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EXECUTIVE INSIGHTS

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WILLIAMS CIO, SAVE THE CHILDREN INTERNATIONAL

LEADERS MUST INFLUENCE THROUGH COLLABORATION, NOT HIERARCHY

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henever IT and business leaders gather together, sooner or later the conversation turns to an age-old question: “To whom should the CIO report?” While there are usually several good answers offered and debated, I cannot help thinking that this is the wrong question.

Surely a more useful debate would be: “How can the IT leader maximise her influence in order to drive value for the enterprise?” To me it is clear: influential IT leadership is now more strongly linked with the ability to collaborate and much less about the position of IT within the organisation.

Collaboration can be viewed as a ‘meta-ability’ to enable new networked influence and leadership models. It requires leaders to identify, assemble and dismantle teams very quickly, based on the fluctuating demand for knowledge and experience across different challenges. It requires the personal agility and flexibility to run an innovation focus group on the shop floor in the morning, review a new business opportunity with the board in the afternoon, and attend a peer networking event in the evening. All of these activities provide a chance for a collaborative leader to influence and to learn, but they require relationships to be maintained all the way throughout the organisation and beyond, not just from the top down or from any

SILOS ARE THE NEMESIS OF ANY ASPIRING BUSINESS CHANGE LEADER LOOKING TO ‘SEED IDEAS’ AND BUILD SUPPORT ACROSS THE ENTIRE ORGANISATIONAL NETWORK” particular seat at any particular table.

Pro-actively guarding against organisational silos is also important. These are a common by-product in a business world that changes very quickly, with organisations regularly undergoing restructuring programmes as they seek higher levels of efficiency and effectiveness. However, they are also the nemesis of any aspiring business change leader looking to ‘seed ideas’ and build support across the entire organisational network.

The ability to influence through collaboration stretches beyond the boundaries of your own organisation too, into those of your customers and suppliers. This is becoming an essential part of leading on a truly global basis, with high performing teams increasingly made up of staff from both developed economies and those in the vitally important emerging markets.

Judgement and flexibility of style across all of these endeavours is now critical.

The collaborative, highly influential leader must become the golfer selecting their strategy for each shot – you have to have the ability and the understanding to play with all of the clubs in the bag.

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ANALYTICS PROVIDES THE EVIDENCE THE ECONOMIES OF SCALE OF LARGE YOU NEED TO INNOVATE BUSINESSES HAVE BEEN USURPED BY he driving force behind most marketers lies in the creative THE AGILITY OF SMALL ONES side – we all want to push the boundaries and do something

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new, something exhilarating or visually stunning, especially in industries like music, film and live events. And it’s that passion for innovation that produces the best results.

But ultimately the main ambition has to be to drive revenues.

There are very few opportunities where you simply work on a piece of marketing creative without linking to deliverables. For us to even have the opportunity to innovate as marketers, we have to convince people that our ideas will actually help to sell more tickets, phones or whatever else it is that we are looking to promote. That’s the biggest

WE CAN ENGAGE IN CAMPAIGNS THAT JUST WOULDN’T HAVE BEEN POSSIBLE WITH THE TRADITIONAL, PRE-DIGITAL BUSINESS MODELS, FROM A TECHNICAL OR BUSINESS CASE PERSPECTIVE” challenge because people will be resistant to trying new things when they’re not comfortable that it will actually turn into sales.

The new technologies and platforms for consumer trend analytics and social engagement provide us with a huge opportunity in that regard. Marketing has always been a mixture between science and art. Now the science side has vastly improved. It gives us the ability to accurately identify consumer trends and drivers and to prove the complex correlations between different elements of a campaign and the effect on different metrics. This liberates us to innovate in the ways we serve the need with the things we create. We can engage in campaigns that just wouldn’t have been possible with the traditional, pre-digital business models, from a technical or business case perspective.

As a marketing leader, that also enables you to keep your employees energised by freeing them up to follow their ambitions.

You can back them in their ideas because you can see the ones which will work. And proven success – which we can track through the various two-way engagement activities – breeds positive morale.

But with the rise in technology, the role of the professional marketer has diversified and grown in complexity. The generic days are gone. You have to specialise in something in any career now, and that’s certainly true in marketing. There is so much to know these days. Any company that looks to employ general marketing managers will struggle with the new dynamic.

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decade ago, the IT thought leader Nicholas Carr foresaw a moment where technology would cross a threshold and cease to be a strategic asset. As we have discovered over the last 18 months at reed.co.uk, that moment has now passed.

With just a credit card, we can now procure business systems which are as good as, sometimes better than, those used by FTSE 100 companies. Relatively small businesses like us, without the complexity of legacy systems and the overhead of high user numbers, can even embrace and adapt to web technologies more quickly than our larger peers. And of course, the ‘browser first’ paradigm scales all the way from one company founder to thousands of staff and is flexible and mobile, by location or device.

More than ever then, the competitive advantage isn’t in the quality of the technology you can afford, but in the way that you integrate that technology into your business. Here too the new model of technology deployment brings huge benefits. Best practice, learned across an install base of thousands, perhaps millions of customers, is often baked into products. Documentation becomes easily available

MORE THAN EVER THEN, THE COMPETITIVE ADVANTAGE ISN’T IN THE QUALITY OF THE TECHNOLOGY YOU CAN AFFORD, BUT IN THE WAY THAT YOU INTEGRATE THAT TECHNOLOGY INTO YOUR BUSINESS” and online support communities proliferate and flourish.

This means smaller companies can use their IT professionals for internal business process consultancy and supplier management, aligning their skills more closely with business value. This in turn enables those companies that are currently unable to justify dedicated staff for more esoteric roles, such as information security specialists, to outsource to providers in the company’s supplier pantheon.

Essentially, with costs and delivery times lowered, small companies are liberated to subscribe to agile development and lean start-up models. They can concentrate on small, incremental, business-focused improvements, rather than ‘death march waterfall’ projects. Failure is not only an option, but is to be encouraged. As the Poppendiecks wrote: “Think big, act small, fail fast; learn rapidly.”

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critical. This shouldn’t be confined to just considering personal data (i.e. personally identifiable information) but should consider all important data assets, including, for example, confidential information, trade secrets and IP. The assessment should take account of the inherent level of risk in the data in question, applicable legal obligations and standards of care and key stakeholder commitments and expectations. For example, you need to check what you have told your customers and regulators about moving data outside of your ‘home’ territory onto global cloud solutions.

Invariably it is considerably cheaper to design a cloud solution to meet requirements for information security and compliance before it has been implemented than to try ow do businesses create a culture to persuade a supplier, with a contract already in place, to of innovation to stay ahead of the make changes down the track. With the increasing ease of competition without exposing downloading SaaS solutions directly from the Internet, with themselves to heightened click-wrap user terms, it is also sensible to train staff to channel information security breach risks all procurement through a central procurement function. in the process?

On the supply side, the challenge is to maintain the This is a common conundrum for energy and passion of garage start-ups in a multi-billion executives today, and there isn’t a one size dollar, sprawling global entity. This is particularly hard for fits all solution. The right approach will organsiations in highly regulated sectors who traditionally depend on the organisation’s particular risk have been risk averse and focused on achieving compliance. profile and appetite. B2B outfits without The process of pro-active risk assessments isn’t always end-consumer personal data or payment feasible in fast moving sectors where launching first is key to card data generally face less information maintaining market share or, in the most extreme cases, the security risk when moving to, say, a cloud survival of the business. Launching fast may mean infrastructure-as-a-service more regulatory headaches and claims but may still platform or a cloud-based IN OCTOBER be preferable to launching late or not at all. The email solution than a retail 2013, THE key is to determine what level of security and bank wanting to adopt the EUROPEAN compliance risk is right for your business. same innovative technology.

PARLIAMENT VOTED Striking the right balance ON THE LATEST requires you to understand PROPOSED TEXT what level of risk is acceptable FOR EUROPE’S to your business with respect CONTROVERSIAL to your data assets. This GENERAL DATA may differ for different data.

Ross McKean is PROTECTION Handling payment card data a partner in the REGULATION. IT is risky and subject to a host London office INCLUDES A GENERAL of regulatory and contractual of the law firm OBLIGATION TO NOTIFY risk and liability. On the other Olswang LLP and ON DATA BREACHES hand, a list of your suppliers’ heads the firm’s AND FINES OF UP TO account manager contact data protection FIVE PER CENT OF details is inherently lower practice. For GLOBAL TURNOVER FOR risk data. updates on data BREACHES OF THE Carrying out a risk and security laws, NEW RULES. assessment before adopting including reports on the proposed EU the new technology is Regulation, see www.datonomy.eu

UNCOMFORTABLE BEDFELLOWS? T H E PER CEIVED WI S D O M IS THAT I N N OVATIO N IS F U N DAM EN TAL TO T HE SUCCESS O F AN Y B U S INESS. B UT I N F O RM ATIO N A N D CY B ER SE CURIT Y IS A L SO M OVIN G U P THE M ED IA, P O LITICAL AN D LE GA L AGEN DAS .

E STAB LISHIN G T H E RIG HT BA L AN CE F OR YO UR O R GANISATIO N A N D O B SER VIN G B E ST PR ACTICE I S C RITICAL.

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INTRODUCTION RESEARCH PARTNER INSIGHTS

RESEARCH PARTNER INSIGHTS 26–28/

SMART421 – CUSTOMER SHOWCASE

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LOGICALIS – THE CIO IS DEAD, LONG LIVE THE CIO

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RITTMAN MEAD – THE CHANGING WORLD OF DATA AND ANALYTICS

Smart421 rounds up its work in establishing cloud- based big data, disaster recovery and service transition with three household name organisations: quotemehappy.com, Haven Power, and the Association of Train Operating Companies

James Thompson, Business Analytics & Information Management specialist at Logicalis, says with successful transformation the CIO can become the pinnacle of the services defined organisation.

Jon Mead, Co-Founder and Managing Director of Rittman Mead explains why big data is a new paradigm for the enterprise, and how technology is both the enabler and driving force.

RESEARCH PARTNER INSIGHTS

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BIG DATA ANALYTICS

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CUSTOMER SHOWCASE IGNITE MTR PARTNER SMART421 GIVES THREE EXAMPLES OF ITS CAPABILITIES IN HARNESSING DISRUPTIVE TECHNOLOGIES FOR CLOUD-BASED BIG DATA, DISASTER RECOVERY AND SERVICE TRANSITION

Smart421 – part of the FTSE 250 KCOM Group – delivers high-end consultancy, integration and service management of business-critical systems for large enterprises.

For over a decade, Smart421 has been an IBM Premier Business Partner and an IBM Tier One Services Partner for WebSphere Business Integration. It is also accredited as an Amazon Advanced Consulting Partner, as well as by the Microsoft Partner Network, the Oracle Partner Network and by ForgeRock.

The Government Procurement Service has awarded a framework agreement to Smart421 for the provision of services under the G-Cloud. Smart421 also partners with Skyscape Cloud Services, a leader in public sector cloud and with Kcom, the specialists in Public Services Networks (PSNs).

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viva launched Quotemehappy.com in August 2011. In early 2012, the company turned to Smart421 for a fully functioning proof-of-concept showcase on how big data analytics could support its unique business challenges.

Smart421 architected Amazon Web Services (AWS) cloud instances and developed algorithms to support granular analysis of customer data on an individual basis. This gave the business a level of insight not previously possible with traditional on-premise business intelligence tools and techniques. It enabled not only new critical intelligence residing within the data sets to be revealed, but also visualisations of key performance measures, such as the geographical base mapping of insurance quotes.

It is now possible for Quotemehappy.com to analyse massive data sets of structured and unstructured data. This means that users within IT have been able to provide answers to questions which have gone previously unanswered, affordably, in a very short timescale. The business can therefore take decisions that impact brand, marketing and advertising spend across personal lines – significantly improving its capacity to trade more profitably and minimise cross-brand cannibalisation throughout the Aviva group.

SMART421’S CLOUD ARCHITECTS GAVE US A HEAD START ON MAKING BIG DATA REAL FOR US, INCLUDING HOW BUSINESS INSIGHTS ARE REALLY DELIVERED, WHAT THE COSTS REALLY ARE, AND HOW THE TECHNOLOGY REALLY WORKS IN OUR CONTEXT. THEIR OUTPUT CONTRIBUTES TO HOW WE DIFFERENTIATE OURSELVES IN A CROWDED MARKET” Keith Misson, Operations Director, Aviva/Quotemehappy.com

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usiness electricity provider Haven Power has grown rapidly since its 2006 formation. By 2011 the company had a rapidly expanding customer base and annual revenues of £125m. It turned to Smart421 for a new technology infrastructure that could keep up with demand.

Previously, Haven Power had invested in technology on a reactive basis as a result of business change, rather than to drive growth. It had only partial virtualisation, was using a mixture of onsite and offsite servers, and its systems were inflexible, offering limited support for technology testing and development. The biggest priority though, was that it had limited disaster recovery capability.

After a consultation period with Smart421, Haven Power decided to implement its business continuity and disaster recovery solution through AWS. Smart421 built a replica copy of the majority of Haven’s technology infrastructure – including Oracle and SQL Server databases, Active Directory, Microsoft Exchange and Windows file shares – and hosted it within an Amazon Virtual Private Cloud (Amazon VPC), ready to go at a moment’s notice should something happen.

With the disaster recovery forming the proof-ofconcept for AWS, Haven was then empowered to explore the further use-cases cloud offers for flexibility, agility and cost benefits.

AS WE ONLY NEED COMPUTE POWER FOR SHORT PERIODS OF TIME FOR DEVELOPMENT AND TESTING, THE CLOUD MEANT WE COULD PAY FOR ONLY WHAT WE USE. ALSO, BECAUSE WE DON’T NEED TO SPEND TIME MAINTAINING INFRASTRUCTURE MY TEAM CAN SPEND MORE TIME ON USING TECHNOLOGY TO IMPROVE OUR SERVICE TO CUSTOMERS AND HELPING THE COMPANY GROW” Paul Armstrong, Business Systems Manager, Haven Power, part of Drax Group

Smart421 is playing a key role within a modernisation programme being undertaken by the Rail Settlement Plan (RSP) – a division of the Association of Train Operating Companies (ATOC) which allows the UK’s various individual rail companies to provide a networked service.

The company is building a flexible, high availability cloud-based solution to support ‘Ticket on Departure’ – the collection of rail tickets purchased earlier on the web from self-service machines. The system will enable cost reductions and better productivity for all franchises when issuing passenger rail tickets. It also provides a foundation for the next generation of ticket issuing systems such as mobile and smartcards.

THIS LIVE SALES MANAGEMENT PROJECT WILL DELIVER HIGH QUALITY SERVICE AT REASONABLE COST WHICH IS GOOD NEWS FOR ALL INDUSTRY STAKEHOLDERS. WE REALISE THAT THIS PROJECT WILL BE WATCHED VERY CAREFULLY BECAUSE OF ITS IMPORTANCE TO RSP AND THE TRAIN OPERATING COMPANIES WE SERVE. SMART421 HAS DEMONSTRATED ITS CAPABILITIES AND CREDENTIALS TO OUR TOTAL SATISFACTION AND THEIR TENDER REPRESENTS EXCELLENT VALUE FOR MONEY” Steve Howes, Managing Director, RSP

NATIONAL RAIL ENQUIRIES

Meanwhile, Smart421 is also helping National Rail Enquiries (NRE), Britain’s leading train information service, also administered by ATOC, to migrate its high traffic, comprehensive, real-time travel information online services to the cloud.

The NRE website offers journey planning and fares information, ticket purchase and on-the-day train running alerts. It handles more than two million enquiries each weekday.

Smart421 is undertaking a service integration and management (SIAM) role which includes service design and readiness, service migration from current data centres to the AWS cloud, and provision of 24-7 service management. Moving forward, Smart421 will manage the scalability features within AWS by deploying tailored automation scripts to match peaks in demand, while minimising infrastructure costs.

IN 2012 WE LAUNCHED OUR APP WHICH – BY THE END OF DECEMBER – RESULTED IN MORE THAN 2.5M CUSTOMER DOWNLOADS. BY WORKING WITH SMART421 TO MOVE TO AWS WE WILL BE ABLE TO SUPPORT THIS SCALE OF GROWTH, ACROSS ALL OF OUR PLATFORMS WELL INTO THE FUTURE. GETTING THE MOST FROM THE AWS CLOUD MEANS HAVING A PARTNER THAT UNDERSTANDS HOW TO EXPLOIT THE FLEXIBILITY AND ELASTICITY IT OFFERS” Chris Scoggins, Chief Executive, National Rail Enquiries

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P A R T N E R L

THE CIO IS DEAD,

CIO

BUSINESSES ARE IN CREASIN GLY BECOMIN G SERVICES DEFINED ENTERPRISES. MANY SEE THAT AS DETRIMENTAL TO THE ROLE OF CIO AND IT IN GENER AL. HOWEVER, WITH SUCCESSFUL TR ANSFORMATION, JAMES THOMPSON, BUSINESS ANALYTICS & INFORMATION MANAGEMENT SPECIALIST AT LOGICALIS, SAYS THE CIO’S STAR CAN ONLY RISE.

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he demise of the IT department and the CIO has been prophesised for more than a decade. In recent years, the emergence and influence of Internet and cloud-based ‘anything as a service’ solutions, delivered as ‘pay as you grow’, have only added impetus to that prediction.

The problem, as many see it, is that the values of traditional IT departments and CIOs are seemingly at odds with new agile business models. This is a headache for CEOs who see insight and the ability to react quickly as the key differentiators needed to drive sustainable growth, profit and stakeholder satisfaction.

Industry analysts commonly contend that most major IT departments still spend around 80 per cent of their budgets on decisions made five to ten years ago. With the colossal ‘ball and chain’ of having to run all of those past technology investments, how can the CIO possibly keep up with the increasing demands for business innovation and insight? Given the pace of change, we can safely assume that, for some, the gap will be widening.

When you consider the rich seam of investment that service providers have tapped into, and the continual assertions from technology vendors that cloud is the ‘only option’ to survive, you begin to understand why the CIO’s standing in the workplace could be perceived to be under threat.

Some commentators even say cloud will be to CIOs what the meteorite was to the dinosaurs: in the new world of cloud, who on earth would choose to be a CIO and how could they survive?

LOGICALIS HOLDS A DIFFERENT THEORY

The dinosaurs had no alternative path when the meteor hit. The CIO does.

Rather than becoming less relevant to the business, Logicalis predicts that the CIO and the IT department will actually become more important than ever to CEOs and their line-of-business colleagues. We say they will be essential to the delivery of the insight that enterprises will need to succeed, and in

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Insight & Service Provision for your business Need to unlock the value of your information to gain clear business insight and drive smarter decisions?

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Businesses are ever more defining themselves by the services they use; they are becoming a Service Defined Enterprise (SDE).

How will you make the journey from head of Information Technology to head of Enterprise Insight?

Logicalis helping you deliver data & information driven insight

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www.uk.logicalis.com Nimbus Ninety MARKET TRENDS REPORT 2014

P A R T N E R L

orientating the emerging technologies and approaches that organisations will need to embrace as they regularly reinvent themselves.

New technologies still require contextualisation and integration within each individual enterprise, horizontally and vertically, to drive business success. The CIO and other specialised IT professionals remain best-placed internally to ensure that critical process takes place.

Transformation is required on their part, from the role of mere information technology provider to what Logicalis now terms the ‘insight and internal service provider’ – something that requires a much closer understanding of the business, and holistic and wide-reaching working relationships with the key players within it. That transformation – which has already begun in some organisations – will position the CIO as the enabler for the successful integration of ‘anything-as-a-service’ agility, measured by consistent enterprise differentiation, profitability and success.

Critically, it will also place the CIO as an assured counterpoint to the ‘quick fix’ messages from third party point solution vendors and providers that are regular and rife in a services led environment; messages that can easily turn the heads of business users and ‘skunkworks’ departments that do not have the contextual experience CIOs have developed through running enterprise class information technology operations.

AT THE CIO’S SERVICE

So the CIO becomes the spearhead of the services-defined enterprise – one that sees technology as a powerful tool in meeting its business objectives. It expects that power to be

SOME COMMENTATORS SAY CLOUD WILL BE TO CIOS WHAT THE METEORITE WAS TO THE DINOSAURS: IN THE NEW WORLD OF CLOUD, WHO ON EARTH WOULD CHOOSE TO BE A CIO AND HOW COULD THEY SURVIVE? BUT THE DINOSAURS HAD NO ALTERNATIVE PATH WHEN THE METEOR HIT. THE CIO DOES.”

THE SERVICES DEFINED ENTERPRISE

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he Internet rapidly accelerated the consumerisation of technology and enabled a growing and disparate range of service providers.

This has created a theoretically infinite choice of IT services that internal business consumers can compare and contrast their experience against.

Buying services is seen as agile, efficient, and, most importantly for the consumer, provides a near immediate realisation of investment benefit and gratification. A new mobile handset works immediately on leaving the store. You can send an email within seconds of signing up to a provider.

You can spin up a fully working Windows server to support your hobby somewhere in the cloud in seconds.

Business executives and line of business leaders are now taking the same approach. Software as a Service (SaaS) has exploded in use because the provider offers something the business user can react to and purchase near immediately. When the sales director wants improved customer relationship manager (CRM software) they can go straight to SalesForce.com and buy mature CRM processes as a service.

If the business approached IT for the same discussion, we know the time frame would have seemed much longer, the cost much higher, and the complexity much greater.

So, today, like the consumer, the business executive is thinking more about the services they require and less about the technology needed to make those services available. And when the business thinks service, they see speed and agility. Of course, this is the message the service provider presents at every opportunity.

Businesses, like consumers, are ever more defining themselves by the services they use; they are becoming services defined enterprises.

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increasingly responsive in adapting to its needs, and, more specifically, its customers’ needs.

The power will not be realised from the complexity of the underlying infrastructure in the organisation’s data centre, but from the business never knowing it even has a data centre. It does not need to know how a service is delivered, just that it is. As the predicted shift of IT spending moving from IT department to business unit occurs, executives and line-ofbusiness leaders are increasingly thinking of the services they need rather than any underlying technology decision making.

The agile, services-defined-enterprise will consider services from any source. This opens up three key opportunities for the CIO: Firstly, for IT to transform how it builds and operates IT infrastructure and systems, ensuring agility equalling that of external providers Secondly, for IT to define its position as the contextual advisor, able to define, source and engage with external service providers that support the enterprise service orientated goals, rather than detract from them.

Thirdly, to deliver data and information driven insight, from its ability to inform the strategic goals of the business based on total data insight and bridge the gap between operations, tactics and strategies throughout enterprise operations.

The role of the CIO won’t be to curtail these services portfolios, replete with their compelling operational, cost and consumption models. It will be to enable them contextually, sustainably and profitably source or create services from the most efficient and appropriate source, by cost, risk and speed. The CIO is dead, long live the CIO.

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ogicalis is an international IT solutions and managed services provider with a breadth of knowledge and expertise in communications and collaboration; business analytics and information management; data centre and cloud services; and managed services.

Logicalis employs highly trained service specialists who design, specify, deploy and manage complex ICT infrastructures to meet the needs of almost 6,000 corporate and public sector customers.

The Logicalis Group is a division of Datatec Limited, listed on the Johannesburg and London AIM Stock Exchanges, with revenues of over $5 billion.

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P A R T N E R R

THE CHANGING WORLD OF DATA AND ANALYTICS

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JON MEAD OF RITTMAN MEAD EXPL AINS WHY BIG DATA IS A NEW PAR ADIGM FOR THE ENTERPRISE, AND HOW TEC HN OLOGY IS BOTH THE ENABLER AND DRIVIN G FORCE. JON MEAD IS CO-FOUNDER AND MANAGING DIRECTOR OF RITTMAN MEAD, A BUSINESS INTELLIGENCE AND ANALYTICS COMPANY. HE SPLITS HIS TIME BETWEEN RUNNING THE COMPANY AND ENGAGING IN THE WIDER WORLD OF DATA AND DECISION MAKING.

rganisations have always had data at their core. Managers, executives and most knowledge workers have used it for insight and understanding in helping them make decisions as long as we’ve had the ability to count. Within any organisation, for instance, the basic profit and loss (P&L) report – however it is structured or broken down – is one of the key business drivers.

But there is overriding evidence to suggest that data is now playing an ever more prevalent, and potentially disruptive, role in our world. Data volumes are exploding, driven by mobile, social media, increased connectivity and lower hardware costs for

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THE TECHNOLOGY ENABLERS

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IT will always adapt to business problems.

Software has become more advanced and hardware has become cheaper, enabling more data to be stored on disk and to be pushed to memory for faster and more efficient processing.

However, the likes of Google, Facebook and Yahoo have given us the biggest breakthroughs. These organisations had significantly different data processing and storage needs from traditional corporations, so they chose to write a set of open source tools to address their needs. They developed programs like Hadoop, Hive, Impala and Pig which offered a cheaper way to both store and process data through a combination of open source, commodity hardware and distributed processing.

Alongside the ability to store and process ever larger sets of data, tools have also arisen to both statistically analyse the data and visualise the result. The main example of this is the R programming language.

As a result of both the rise of the significance of data, and of these new

THE NEW PAR ADIGM

TR ADITIONAL BUSINESS INTELLIGEN CE PYR AMID Decisions

Knowledge

Data

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storage. As consumers we are also becoming more and more used to instantly accessing and engaging with data.

Part driving this change, part as a reaction to it, businesses are having to adapt. Markets have been blown open and customers can now come from any geography or demographic. Trends, and hence customer needs, change quickly.

News and information, whether good or bad, travels faster.

Concepts like ‘big data’ and ‘customer experience’ are the reactions to these changes, and the ways organisations are addressing the challenges they bring.

Regardless of the nomenclature, data is underpinning this revolution.

Information

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Data

Data is disrupting our world.

Data volumes are exploding.

Data continues to play a more prevalent role in our lives. Driven by mobile devices, social media and increased connectivity, consumers now expect constant access to public and private data regardless of location.

Businesses need to adapt, understanding that markets are more open than ever before. Potential customers exist in any demographic or geographic location, and their needs change quickly.

Ri Rittman Mead is helping organisations across the globe increase their analytic capabilities by implementing Big Data initiatives and enhancing Customer Experience.

Contact us for further information: info@rittmanmead.com

www.rittmanmead.com

P A R T N E R R

technologies, organisations now have a different approach to storing and analysing data.

THE TRADITIONAL BI MODEL

Up until now, our modern-day data analytics has centred around the traditional business intelligence (BI) proposition. The BI pyramid is underpinned by data at its base which is then enriched through an integration and aggregation process (extract, transform and load - ETL) to become a smaller, richer layer of information. This in turn is translated to a pinnacle of knowledge by analysts and end users.

This pyramid is backed by a well-defined process. Reporting needs are analysed and a logical model is designed that allows users to query the data. The model is then created in a database, ETL processes are written to populate the database structures, and a semantic and reporting layer is laid over the top, allowing analysts to consume the information and gain insight.

That process solved the business problems it was designed to, and continues to solve those problems today. Now, though, there are new problems to solve and new things we can achieve.

THE NEW PARADIGM

Hadoop, and other similar ‘key pair’ or NoSQL databases, don’t need data to be structured in the same way as the relational databases in our traditional business intelligence proposition. Organisations can therefore use them as repositories for storing growing and more diverse data sets.

With this approach comes a new paradigm: schema-on-read. The traditional defined model for writing data into a warehouse requires a large amount of effort to be invested in transforming the data to that model and storing it. That makes it quick to read for the business problems it was

THE NEW DATA ARC HITECTURE

originally intended for, but if the business is changing rapidly the model can’t keep up with the changes. Hence, the queries run against the data warehouse would be solving yesterday’s problems. Additionally, the effort of loading every bit of data into a conformed model, with the potential volume and diversity of the source data, could mean massive overheads.

Schema-on-read allow organisations to store massive, diverse data sets and then only tackle the problem of deciphering it when specific business problems arise. The approach has thus led to a cultural change in how individuals and organisations view data by hugely widening the scope of what they can address with it.

INDUSTRIES LIKE TELECOMMUNICATIONS USE THE NEW TECHNOLOGY TO EXTEND THE AMOUNT OF DATA THEY CAN STORE. PREVIOUSLY IT WAS ONLY ECONOMICALLY VIABLE TO STORE A LIMITED AMOUNT OF THE NETWORK DATA THAT IS CONSTANTLY CREATED. NOW SIGNIFICANTLY MORE DATA CAN BE STORED, ALLOWING DEEPER ANALYSIS OF CUSTOMERS’ USAGE PATTERNS”

HOW THIS AFFECTS THE ENTERPRISE

The key question most organisations are asking is: ‘How can we use this new approach?’

Most organisations are not Google or Facebook. They have different business models, resources and requirements for data.

Coupled with this, relational databases are not going away; organisations have a need for transactionally consistent databases to run their line of business operations, and many organisations have invested heavily in their data warehouse infrastructure.

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They are therefore much more likely to take an evolutionary approach rather than a revolutionary one. This means that they will focus on integration and seeing how big data based technologies can complement their architecture.

There are a couple of usage patterns we are starting to see:

AUGMENTING DATA WAREHOUSES

Hadoop, or similar databases, can run alongside the traditional Enterprise Data Warehouse (EDW), storing the historic data that isn’t queried on a daily basis, but is kept for legal or ‘just-in-case’ reasons. This reduces the amount of data stored in the more expensive EDW. Industries like telecommunications are using the new technology to extend the amount of data they can store.

Previously it was only economically viable to store a limited amount of the network data that is constantly created.

Now significantly more data can be stored, allowing deeper analysis of customers’ usage patterns.

Another approach is to offload some or all of the ETL processing into the Hadoop database and then load the pre-processed results into the data warehouse.

DEEP ANALYTICS

Once an organisation implements a ‘big data’ data store it opens up the ability to use deeper analytical tools on these new, or wider, sets of data. The software is now available to do this and skilled users – data scientists – can interrogate the data and potentially find new insight into business problems.

The skills to perform this type of analysis are not typically end user skills, so investment in people is required.

THERE ARE CHALLENGES AHEAD

Whilst this article paints an optimistic picture for how data can help organisations, there are a lot of challenges ahead. Big data is not a one size fits all solution for every data problem within an organisation.

Data architecture, management and governance will not go away. Thinking of big data as a way to circumnavigate these will result in contradicting silos of information.

However, if the above technologies are implemented as part of a coherent information management strategy, backed by changes in processes and people across the organisation, then the new data and analytics paradigm has much to offer.

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Nimbus Ninety MARKET TRENDS REPORT 2014

NAVIGATE THE IMPACT OF DIGITAL DISRUPTION ON YOUR BUSINESS STRATEGY

We aim to help members create a fully integrated, emerging technology vision that helps them realise the innovation capabilities of digital disruption as well as helping to cut through the complexity and prioritise what needs attention now.

Business Leadership E X C H A N G E

• Exclusive access to research reports, case studies and C-level interviews • Monthly private networking dinner and discussion evenings, following Chatham House Rules, at some of London’s most stimulating and thought provoking locations.

‘I did find last night very interesting and thank you for hosting the event, it was enjoyable and the venue amazing’ – BP If you would like to take advantage of all of the benefits of the Business Leadership Exchange please contact Milly Maxwell-Scott at milly.maxwell-scott@nimbusninety.com or call: 0203 598 2237.

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