A grid style computing model

A grid infrastructure may not be the case for certain organizations. The reasons for this may be one of enterprise size, IT policy, outsourcing model, lack of budget, or ISV certification. In these circumstances it is generally recognised as good practice for applications with non-intensive workloads to use server virtualisation in order to consolidate.

However, where maximising consolidation, availability and agility are of paramount importance, a combination of server virtualisation and grid-based solutions are the best way to maximise the benefits of consolidation, availability and agility. Working in tandem, they can ensure enhanced server virtualisation, the ability to dynamically scale within and across nodes, and the dynamic resizing of virtual nodes.

Compared to other models of computing, IT systems designed and implemented in the grid style deliver a higher quality of service, at a lower cost, with greater flexibility. Higher quality of service results from having no single point of failure, a powerful security infrastructure, and centralised, policy-driven management.

Lower costs, meanwhile, derive from increasing the utilisation of resources and dramatically reducing management and maintenance costs. Rather than dedicating a stack of software and hardware to a specific task, all resources are pooled and allocated on demand, which eliminates underutilised capacity and redundant capabilities. Grid computing also enables the use of smaller individual hardware components, which reduces the cost of each individual component and provides more flexibility to devote resources in accordance with changing needs.

Forward-thinking enterprises are implementing grid computing to take advantage of database consolidation, running multiple, disparate workloads on the shared resources of the grid. The result is a more available, scalable, flexible and cost effective infrastructure resulting in better service levels to customers, users and partners. Latest grid-based solutions are now available that also offer all the benefits of server virtualisation to single-instance databases on a physical hardware infrastructure.

Many databases can be consolidated into a single cluster with minimal overhead while providing the high availability benefits of failover protection, online rolling patch application, as well as rolling upgrades for the operating system.

With these next-generation grid-based solutions, there are no limits to server scalability and if applications grow to require more resources than a single node can supply, they can be easily upgraded online. If the node becomes overloaded, users can migrate the instance to another node in the cluster using an online migration utility with no downtime for application users.

Business is adopting 'On-Demand' model

The business world is adopting an on-demand model, and for a very good reason: the business environment is changing faster and becoming more unpredictable. That leaves us with a choice to incorporate the change in our core business or spend money, time and effort in exploring the past trends.

How many times has it happened in the past? We made our cost benefit analysis, the savings looked terrific, the solution got implemented, and life was happy go lucky. Then the reorganization happened, the planning went out of window, and now we’re saddled into an IT infrastructure system that doesn’t fit the new situation we are in now. That’s business today. Even the list of things that are changing is changing. What we need is a solution that’s designed for change. What we need is an on-demand business model. We need to be able to change with a change in the IT infrastructure system.

And if, the IT infrastructure is an important part of your business, one can not ignore the on-demand model of design for change. Today, whatever challenge the IT face: reorganization, spin-off, T&M, outsourcing or off-shoring, we need to build flexibility into our IT infrastructure.

With the flexibility gained with pay-as-you go, we can reduce overhead significantly. Our  infrastructure will simply do what we need it to do. With more options open to business, we will be able to focus more on business strategy than on tactics. One can eliminate wasted time, effort and headaches, to focus on work that builds business value.

Accelerating the Business

Having survived Enterprise Application Integration (EAI) and Business-to-Business integration (B2Bi) projects, enterprises are looking for fresh ways to accelerate business and to increase efficiency and agility. Web services, a set of technologies that automate business processes,promise the speed and agility that enterprises seek to create a competitive edge.

Unlike previous technological innovations that required re-engineering work or hands-on intervention from end users in order to effect changes, Web services are layered onto existing applications and are themselves self-adapting, capable of discovering and querying one another automatically, and able to connect, compare, assess, re-configure, and transact as quickly as business needs demand. The result is an unprecedented degree of automation, efficiency, and agility.

Constellations of business connections and trading networks can appear overnight as Web services automatically pursue opportunities that even the most diligent human workers, peering into their Web browsers, would have been sure to overlook.

A Tool Cloud

Today, most sizable IT organizations have hundreds, if not thousands, of licenses for software tools that are critical for building and running the databases and applications that power their business. Managing these tools and their associated licenses, including deploying, provisioning, and updating them, is time-consuming and incurs many hidden costs. There are also real productivity costs when IT professionals can’t readily access the tools they need at the right time. On the other hand, putting a bunch of tools on a server with no management, provisioning or usage tracking capabilities around them can come at an even higher cost. So then, where should IT professionals or anyone else responsible for setting up and managing a tools infrastructure look for answers? The latest phenomenon sweeping the IT landscape – cloud computing – may hold the most promise to overcome this issue.

The reduced complexity, lower costs and improved scalability afforded by enterprise clouds are growing in appeal to many IT organizations. What many people fail to realize is that cloud-derived advantages such as on-demand access, shared pools and rapid provisioning are not limited to running their databases and applications. These same benefits can also be extended to help them reduce the costs and complexities of managing the myriad software tools they use to design, build and manage their systems. By employing cloud principles to set up a private cloud infrastructure for tools – a tool cloud, if you will – complete with application virtualization capabilities, organizations can centrally provision and manage licenses across their enterprise.

The emerging tool cloud approach can give IT groups within an enterprise instant access to many of the tools they need to solve critical tasks, both improving their productivity and reducing tooling costs by allowing software to be shared.

IT Ecosystem

The IT industry today consists of a rapidly evolving and massively interconnected network of organizations, technologies, products and consumers. In contrast with the vertically integrated environment of the 1990s and millennium 2000, today’s industry is divided into a large number of domains producing customized components, systems, and services. The degree of interaction between firms in the industry is truly astounding, with substantial number of organizations frequently involved in the design, development, out sourcing, or implementation of even a single module of enterprise software suites.

The IT ecosystem began the 21st century by entering a deep recession, made worse by over investments and business failures in the IT, Software and Telecommunications industries. At around the same time, Microsoft Corporation and the US Department of Justice entered into a Consent Decree (“Consent Decree”) that resolved their multi-year antitrust dispute. Since, this period of retrenchment, the IT ecosystem has regained its health, rebounding from its recession and delivering significant levels of innovation.

This network of organizations can be compared to a biological ecosystem. Like its biological counterparts, the IT ecosystem is characterized by a large number of variables who depend on each other for their mutual effectiveness and survival. Because the performance of individual firms and the utility of individual products depend so much on the performance of other firms and products in the ecosystem, understanding the IT ecosystem requires the development of ways to characterize the collective health of the setting. Drawing from a variety of public and proprietary data, including market value indicators, productivity measurements, and return on invested capital metrics with respect to the three critical indicators of IT ecosystem health, robustness, productivity, and innovation, the IT ecosystem is strong in all three of the most important sectors of Hardware, Software, and Services.

Robustness - can be assessed in a variety of ways. One way is to analyze the sustainability of value in the ecosystem. The persistence or recovery in the value of the constituent firms after a major disruption can be used as an indicator of the ecosystem’s robustness. Another approach to robustness, developed elsewhere, is a measure of financial betas and firm survival rates. A healthy ecosystem will promote the survival of a diverse set of firms, including those that populate a variety of niches, through inevitable disruptions. This diversity provides greater choice and reliability to the customers that depend on a business ecosystem.

Productivity - In conservation literature on biological ecosystems, the term productivity how effectively the ecosystem converts raw materials into living organisms - is a widely used measure of ecosystem health and how it benefits those who use it. Improvements in productivity show that an ecosystem is able to produce more with the same or less input. In the long run, real earnings in a business ecosystem are tied to productivity gains. Improvements in productivity within the IT ecosystem are equally important measures of the health and competitiveness of the IT industry. Output per hour of all persons – or labor productivity – is the most commonly used productivity measure.

Innovation - Robustness and productivity do not completely capture the health of a business ecosystem. Both in ecological and business literature, it is important that systems also exhibit variety or diversity — that they support many different species or types of organizations. Innovation, or Niche Creation, is the critical mechanism by which business ecosystems increase diversity over time. This diversity results in new alternatives and choices for the customers that depend on a business ecosystem. In the analyses of Innovation that follows, we will first look at broad indicators of innovation across the IT ecosystem, and we will then review specific cases of very rapid innovation in products and business models that have resulted in significant growth and changes in the competitive landscape. The return on venture capital is a good measure of the effectiveness of investment in innovation and niche creation. Venture capital is the primary source of funding for start-up activity in new ecosystem domains. Venture capital investment on its own (or the number of new firms created) is not necessarily a good indicator in this context, because we are interested in meaningful, sustainable innovative niches. Return on venture capital investment is a much better indicator of sustainable innovation and niche creation than overall investment levels.

Finally, there is a strong level of innovativeness and growth, with new competitors repeatedly challenging the more established companies. Software and hardware platforms are witnessing significant innovation and evolution, which is in turn fueling innovation in a broad variety of applications and business models.

Shared Business Model

Shared Service Model is collaborative approach to pool in all the resources into one. This approach allows the economies of scale, pooled experience, associative responsiveness, partnerships with in the organization for low cost and high quality. An internal business unit works as a service provider to the business clients that fulfills the non-core businesses and fragments the core business with higher epxertise within the pool of intelligent resources, with other business units of the same organization. Business organizations request products and services within the organization from the one of the business unit so called 'Shared Service Provider'. The various business units are billed interally and their costs are recovered through revenue generation. Since, these clusters of internal business units have to show profitability for their own existence. They normally buffers up some margins in the cost offered to the 'Shared Service Provider', which is a wrong practice. As it reflects the overall cost of the project that can be relatively higher then the actuals. These services are SLA driven and are renegotiated from one client to another. The measurement from internal and external benchmarks ensures that the shared service ogranization is constantly improving.

Also, the bigger organizations have widen their horizons to get into similar partnerships with OEMs to enjoy low cost, expertise, and efficieny in overall execution of the projects. This has certainly benefitted the cusotmers with a quality of service on one hand and lower cost on the other with a structured break up of fat cost that could have come from one business unit earlier.

However, the shared services model has it's own limitations. Unlike outsourcing, for example, which can be used with companies of any size, shared services can live up to its potential only when the parent corporation is above a minimum size. Whether or not shared services makes sense for a particular business application depends on the business, the corporate culture, the applicability of alternative business models, the economic health of the company, the wants and needs of corporate senior management.

Shared Services & Recentralizing

In a recent survey from Forbes, a big question poped up. Is the demand for IT services down or up? Well, the experts have said it right that "demand is still very strong". It's the companies who are cutting down budgets on new assets, hires, software, and hardware. They are trying to meet customer's needs with existing resources. Infact, they are curtailing consultants rather than consultancy. Most of the data is digitized and the volume of transactions are growing like anything. A robust data management infrastructure through data consolidation (green data center) and virtualization have some answers to cut down on cost and might bring a smile on the CIOs face to add some value to the customer's growing needs of humangous transactions.

The transation-volume-revenue, equation has broken down. But, the amount of work involved is growing at it's own pace. In the early years of 2000 the focus was on outsourcing when we were trapped in similar recession then. Now, the focus seems to be shifted in the similar scenario in this recession. Where, CIOs are focusing more on shared services and recentralizing IT.