cloud computing | Paul Wallbank - Communications Professional

Managing the data stream

Managing the data deluge is where Salesforce is focusing its efforts in a competitive market

One of the world’s biggest tech events – if not the biggest of the vendor shows – is Dreamforce, Salesforce’s annual spectacular that this this year attracted a 150,000 attendees to San Francisco’s Moscone Center.

Every year sees the company – which now holds the title of the world’s fourth biggest software company – and its CEO, Marc Benioff, defining the direction of the company in the face of a rapidly changing market. Despite being a pioneer in cloud computing, the company is as vulnerable to disruption as anyone else in a rapidly changing marketplace.

This year, the focus is on analytics and automation along with a strong leaning towards the Internet of Things and app development on the Lightning platform they announced last year.

With the Thunder platform, Salesforce is offering a service that allows businesses to connect devices onto their platform where users can build up rules based business automation. One notable part of this is the integration with Microsoft Office 365, another example of Microsoft’s reaching out to previously hostile companies.

For Automation, Salesforce is building upon its RelateIQ acquisition from last year, now branded as SalesforceIQ. The company says “Relationship Intelligence technology that utilizes advanced data science to analyze company relationships and drive actions.”

The Wave analytics service, which was also announced at last year’s Dreamforce, is a key part of the the business automation and IoT services in providing the insights into the data being collected. In many respect, Wave is going to be the glue that holds most of the products being announced this year.

Complementing the Wave, Thunder and SalesforceIQ products is the Lightning platform, again announced last year, that allows users to use the company’s AppCloud to quickly build business applications.

For Salesforce, the direction being laid out from this Dreamforce conference is in making helping customers deal with the masses of data coming into the enterprise. As Tod Neilsen, the company’s Executive Vice President of the App Cloud says, “we’re look at making the data usuable for spreadsheet users.”

As businesses struggle to manage and understand the masses of data flowing into their organisations, this may well be a powerful selling point for Salesforce.

Paul travelled to Dreamforce 2015 in San Francisco as a guest of Salesforce

Avoiding the next wave of tech carnage

Today’s high growth businesses could be in tomorrow’s deadpool

“From the EMC boardroom you can see the carnage of the mini computer industry – Wang, DEC, Data General – you can see their buildings from the headquarters,” said VMWare’s CEO Pat Gelsinger during an interview this morning.

Gelsinger’s point is well made, those companies were victims of the last major computing shift which saw the minicomputer fall out of favour and be replaced with workgroup servers largely running Windows.

For VMWare, those Windows based servers were the basis of their successful virtualization product and the company was one of the winners of the shift to Personal Computers.

Shifting to the cloud

Now a shift to the cloud, something that Gelsinger sees as a bigger and more fundamental change than the one that dispatched companies like Wang, DEC and Data General to the deadpool in the 1990s, threatens to do the same to the companies that did well in the PC era.

That shift is seeing VMWare repositioning their business to their “unified hybrid cloud”, Dell shifting away from being primarily a PC manufacturer and Microsoft rethinking its entire existence. All of these companies are deeply threatened by IT’s move to the cloud and mobile services.

Watching for unicorpses

It isn’t just today’s incumbents that are threatened by shifting markets, a few of the current crop of today’s billion dollar unicorns will almost certainly become ‘unicorpses’ warns Nick Bilton in Vanity Fair.

That some of today’s seemingly untouchable tech startups may also join venerable older companies in the history books may surprise some but the risks are high, the shifts are great and the successful business strategies are not always obvious early in a technology shift.

One clear point is that size is no barrier to eventual failure, as we see with once untouchable giants winding up after technology and markets move against them it’s only the fast moving and flexible thinking that will survive.

The Age of Rattling the Cage

We’re in a time where when taking risk is the lowest risk in business says VMWare CEO Pat Gelsinger

“It’s no longer the big beating the small, it’s the fast beating the slow,” says Eric Pearson, CIO of the InterContinental Hotels Group.

Pearson was quoted by VMWare CEO Pat Gelsinger in his five imperatives for digital business keynote at the VMWorld 2015 conference being held in San Francisco this week.

The five are an interpretation of the trends in a radically changing business environment where the barriers to entry have fallen dramatically, industries are globalised and the time to market for new products has collapsed.

Put together, Gelsinger believes established businesses have to be more nimble as market and industry forces are going to punish those who are too slow to adapt.

Elephants must learn to dance

Gelsinger’s initial point is the world of business is now asymmetric – incumbents have everything to lose in the face of new businesses where upstarts have nothing to lose.

Part of that asymmetry comes from the world of shared resources, which gives startups and smaller businesses access to tools that were once only available to large organisations.

An obvious example of this are the cloud computing services that is concentrating VMWare’s minds, however another good example of how shared resources will change industries is the self driving car where Gelsinger cites vehicle utilisation will go from 4% to 71%.

Gelsinger points out using a car on a pay for use basis will change the structure of our cities which in turn changes the economics of living in suburbia and the business models built around it.

Standardising the cloud

Cloud computing is at the end of its formative, experimental phase and entering into a professional era where different types of services are going to have to work together.

“We have the private cloud which is focused on IT as we know it today, pulling out costs, slow and complex applications but also has powerful governance and does what I need it to do while meeting compliance purposes,” said Gelsinger. “On the the other side we have the public cloud which is fast and is able to scale effectively but has weak governance.”

In a perverse way, it’s Edward Snowden’s revelations that are driving many businesses to maintain their own private cloud networks due to concerns about foreign powers tapping their information flows and the sovereignty of data.

The consequence of a range of different cloud environments mean they are all going to have to get along with open standards becoming more important as businesses ‘mix and match’ their requirements.

Meeting the security challenge

As the Snowden affair shows, IT Security is difficult, complex and messy and becomes more so as workers start using their mobile devices and data is pushed around the cloud.

Gelsinger sees the online security sector as being the one of the biggest opportunities for startups and one of the fastest growing costs for business, “the only thing growing faster than the spend on security is the cost of security breaches.”

While Gelisinger’s focus is on VMWare’s security proposition, the security mindset is going to have be adopted by all business people. As the Target and Ashley Madison breaches have shown, the damage that can be done by a security lapse can be crippling and is a tangible business risk that senior managements and boards need to be across.

Proactive technology

Artificial intelligence has been through a thirty year gestation and Gelsinger told of his early days as a computer engineer working on AI projects in the late 1980s. Those early days of AI were a failure as the results as the time didn’t live up to the hype.

Gelsinger sees this as the next wave of computing as it moves from being reactive to proactive as systems become able to anticipate actions based on the data they are seeing.

While this has major ramifications for the computer industry, it also promises to change management and the role of many professions.

“This is going to change human experiences,” says Gelsinger however there will be challenges as businesses strike a balance between creepy versus convenience and invasive versus valuable.

Welcome to the age of rattling the cage

Half of the firms on today’s Tech 100 list will be gone within 10 years, was the warning in Gelsinger’s final point and he focused on the need for businesses large and small to break out in order to stay relevant.

“Welcome to the age of rattling the cage,” stated Gelsinger. “A time when taking risk is the lowest risk.”

Paul travelled to VMWorld 2015 in San Francisco as a guest of VMWare

Dealing with an app driven world

The challenge of dealing with a app driven, mobile workforce isn’t just one for technology companies.

“It isn’t easy to create apps for the real world,” is the opening line of this morning’s VM World conference in San Francisco.

That line encapsulates the challenge facing almost every company, not just tech companies like VMWare, in the face of shifting marketplaces and technologies.

One of the biggest business shifts is the move to mobile technologies. This isn’t just changing marketing and user experiences but also changing companies’ operations as staff increasingly use their own smartphones and tablets to work.

Managing a shifting market

That shift though is not simple, as ZD Net reports Facebook’s move to ‘mobile first’ was a tough path in the words of the company’s senior engineer Adam Wolff.

“I think everyone would say it was worth it, but it was extremely painful,” Wolff admitted, explaining each sub-team was building in their own ways because there was no one to crossover with necessary knowledge.

Facebook has probably been the most successful company is dealing with the mobile shift and their difficulties despite their massive resources show just how difficult it is for companies to change not just their technology, but their business processes and in many cases the entire mindset of the organisation.

Those pain points in transitioning between ways of doing business is where opportunities lie, for VMWare they are seeing IT departments struggling with the development and deployment of apps along with the security risks of staff bringing their own mobile devices.

Happy coincidences

For VMWare, this is a happy coincidence in that their main business of computer virtualisation is as much at risk from the shift to cloud computing and mobile applications as any other business. By offering the tools for companies to manage that shift, they can retain their place in the market.

The threat though is this space has many other contenders – not least Facebook itself with its open source React platform the company developed out of its experiences in developing its mobile product.

One of the strengths VMWare has is being an incumbent, which is why they are pushing their ‘hybrid cloud’ offerings where companies use both their own data centres along with the public cloud providers such as Amazon and Microsoft.

Stuck with sunk costs

For large corporates with huge sunk costs in their own infrastructure and those with security or operational reasons for keeping some of their functions in house that hybrid strategy makes sense as it’s unlikely any board or CIO is going to happily burn their existing systems and process down and go to a ‘pure cloud’ or mobile strategy.

While catering to that market is lucrative for the moment, the longer term risk is that the next wave of large corporations – and today’s high growth businesses – are pure cloud companies.

For the companies catering to the old ways of doing business, for the short term there’s profits to be made in the pain points from an evolving marketplace but in the long term it’s how well businesses are placed for the world the end of that transition that will guarantee their survival.

The process facing software companies like VMWin dealing with as business shifts is a challenge faced by almost all industries, the question is how to adapt to a very changed way of working.

Why do we still use fax machines?

Fax machines were once a standard form of business communication, today they are a superseded transition effect. Why do still use them?

If you’re in the ABC Canberra area at 4.05pm, I’ll be talking about this with Adam Shirley. Listen live here.

One of the most frustrating statements in modern business is “you’ll have to send a fax.”

Facsimile machines, once the pinnacle of 1980s business communications although they were first invented in 1843, started to die once the internet became common and email became the dominant messaging system.

Once dial up modems started becoming standard on computers, receiving faxes electronically became feasible and for while businesses struggled with the notoriously unreliable software to receive facsimile messages without the hassle of paper.

Eventually however they passed away as most business found there was no need for faxes and anything requiring a signature could be electronically signed or a scan of the original document sent.

Some industries and sectors – particularly the legal world and some government agencies – still hold out the need to send an ‘original’ by fax, party under the fallacy a facsimile copy is more secure, reliable and legally more valid than an email or electronically lodged document.

During the ABC Canberra program one listener pointed out the medical industry is dependent upon the older technologies, “we couldn’t operate without them” she told the producers. In a time of connected medical equipment and electronic data interchange, the medical industry has little justification in using outdated manual methods but habits die hard in a very conservative industry.

None of the myths around the reliability of fax are true and the reality is details sent by fax are just as easily intercepted by nefarious employees or third parties as emails. In many respects a fax is less secure than electronically interchanged data.

If you do have the need to send or receive a fax though all is not lost, services like eFax will still send or receive messages and then, ironically, email them onto you.

However there is a downside with these services, as one harried PA whose organisation still receives faxes due to its dealings with the legal profession described, the vast bulk of messages they receive are junk messages mainly offering cheap deals on office supplies.

The fax machine is another example of a transition effect where a stop gap product was effective for a short period as businesses adapted to new technologies, the SMS is going through a similar process now. Neither will be the last example of this.

Learning the tools of online business

Accountants are faced with a great opportunity, but they have to learn the tools of online business

The accounting and professional services industries are uniquely positioned as the economy goes digital, while their own sectors are undergoing radical change so too are their clients.

Given the changes facing the accounting industry, the invitation to host last week’s CPA Australia Technology Accounting Forum‘s second day in Sydney was a good opportunity to see how the profession and its clients are dealing with major shifts in their industry.

The accounting profession has been one of the big winners of the Twentieth Century’s shift to a services economy. Last week’s story on how the workforce has been changing illustrates this with a chart showing how the occupation has grown over the past 140 years.

In many respects accountants should be well placed to benefit in a data driven economy given the training and skills they posses. The big challenge for existing practitioners is to shift with the times.

The transition from what’s been lucrative work in the past will be a challenge for some in the profession. Many of the manual tasks accountants previously did are now being automated with direct data links increasingly seeing operations like reconciliations and filing financial returns being done in real time without the need for any human intervention.

In private practice, the shift to cloud computing and direct APIs has stripped out more revenues with useful earners like selling boxed software petering away as services like Xero and Saasu arrived and established players like Intuit, Sage and MYOB moved to online models.

Shifting to the cloud

That shift has already happened with the presenter in one breakout session asking the audience how many practitioners used exclusively desktop software, purely cloud service or a hybrid of the two. Of the twenty in the room, the vast majority were using a combination with three being purely online and one sole operator still stuck with a desktop system.

For accountants the message from all of the sessions was clear; the future is online and businesses based around paper based models are doomed. The question though for them is how will they make the transition to being professional advisers.

Strangely, the big challenge for accountants in private practice may be their clients. A number of panel participants pointed out small business owners are slow to adopt new technologies and this holds both them and their service providers back. Divorcing tardy customers may be one of the more difficult tasks facing professional advisors.

The Technology, Accounting and Finance Forum showed the potential for accountants and professional services providers to be the trusted advisors in an online world, the task now is for practitioners and their clients to learn and understand those tools.

Saying goodbye to the boxes of gold

Intuit’s plan to sell Quickbook is part of the shift to cloud computing that’s leaving old business models dead.

“No-one is making money from cloud software, in the early days everyone made money from software,” bemoaned one of the panellists at last week’s CPA Technology, Accounting and Finance Forum.

A good example of this is the US accounting software giant Intuit putting the 32 year old Quickbooks on to the market.

Intuit was built on the back of Quickbooks but today the product today makes less than 6% of the company’s revenues and under 2% of the profits. Making matters worse is the old code base is clunky, proprietary and expensive to maintain.

Apart from getting a captive – and almost certainly dwindling – client base, there doesn’t seem to be a lot to attract buyers for Quickbooks as a desktop based product in a market shifting to the cloud.

The shifting business model hurts more than Intuit; the accountants, resellers and other service providers who were making a decent income from selling or supporting the box products have seen their margins evaporate.

For users, both Intuit and the services providers moving away from the product risks leaving them and their data stranded, something every business should understand about the risks of proprietary formats.

The shift though by Intuit should be a warning to small businesses that the days of box and inhouse software are numbered and running packages on servers and desktops will soon be for large organisations or niche applications.

Almost every business is going to have to plan its move to the cloud, those who don’t are increasingly going to be left behind in a shifting market.

Are small businesses too old and slow?

Does an aging small business population pose a risk to the economy?

Yesterday I hosted the second day of the CPA Australia Technology, Accounting and Finance Forum that looked at how the accounting profession is being affected by the changing technology landscape.

There’s plenty to write about from the day and how the accounting profession is facing technological change which I’ll write up shortly but one theme from the day was striking – that older small businesses owners are struggling to deal with adopting new tech.

Gavan Ord, the CPA’s policy advisor warns older practitioners are opening themselves to disruption and the Australian business community is in general is at risk as older proprietors aren’t investing or embracing technology at a rate comparable to their overseas competitors.

Older small business owners

That older skew in small business operators is clear, in 2012 The Australian Bureau of Statistics found 57% of the nation’s proprietors are aged over 45 as opposed to 35% of the general population.

Even more concerning is many of those small business owners expect to retire with a 2009 survey finding 81% were intending to retire within ten years – it would be interesting to see how those ambitions changed as the global financial crisis evolved.

A risk to the broader economy

This blog has flagged the risks of an aging small businesses community previously, but Gavan Ord’s point flags another risk – that older proprietors being reluctant to invest in new technology means a key segment of the Australian economy is unprepared for today’s wave of technological change.

A key message from the CPA forum was that the shift to cloud computing is radically changing the business world as sophisticated data management, analytic and automation tools become easily available. Companies, and nations, that don’t take advantage of modern business tools risk being left behind in the 21st Century.

Life at the data frontline

Google’s challenge with managing exponential data growth is something all companies will have to deal with

One of the defining features of the next decade’s successful businesses is how they manage data. No company has a greater challenge in dealing with information than Google.

In a feature tracking Google’s evolving data centres, Techcrunch describes how the company has dealt with the challenge of being the web’s repository.

The challenge has been huge, Google’s current Jupiter network delivers a petabit each second, a hundred times more capacity than its first-generation network and in 2005.

Google boasts 10,000 of their servers are capable of reading all of the scanned data in the Library of Congress in less than a tenth of a second.

While most businesses won’t need that sort of capacity in the near future, the exponential growth Google has dealt with is the same issue facing most managers and business owners as more devices, staff and customers become connected.

For most organisations, dealing with that dramatic growth is almost impossible and this is why automated services running on the cloud will become even more a part of daily working life. Those services will be running on the technology Google is developing today.

Business and the workforce in an app driven world

As the workforce shifts to being mobile, so too must businesses

One of the things we know about the future is the workplace will be very different. Just as the Personal Computer changed offices in the 1990s, the smartphone and tablet computer are changing today’s.

Part of that change though is being driven by the change in generations. While this blog tries to avoid falling into the trap of generalising about different age cohorts – and contends the entire concept of baby boomers as an economic group is flawed – there are undoubtedly differences between the world of the PC generation of workers and that of the new mobile breed.

The key difference is the idea that work devices are different to those at home. Those of us bought up with the idea that the office computers would be tightly locked workstations – in the 1990s we also had the quaint idea corporate desktops were generally more powerful than what we had at home – are now seeing that way of working being abandoned.

For the next generation of office workers, accessing corporate resources through an app connected to a cloud service will be as normal as opening Windows NT to access the shared corporate drive was 15 years ago.

Along with the technology and generational change driving businesses into the cloud-app computing world there’s also the needs of a much more fluid and mobile workforce. The shift to casualisation began well before PCs arrived on desktops but the process is accelerating as we see crowdsourcing and the ‘uberization’ of industries.

Older workers will adapt as well, many came through the evolution of business computing from ‘green screen’ displays – if their businesses had any at all – through to the server based systems of recent years. For them the shift to smartphones might be troublesome for those with fading eyesight, but it won’t be the first change.

For businesses this shift means they have to start planning for the mobile services that will change workforces and industries. The shift is already well underway – accounting software company Intuit estimates small businesses already use an average of 18 apps to run their business.

We all have to start thinking about how these apps can be used to manage our staff and workforces.

Mimecast and the future of email

Email continues to the key computer business application says Mimecast’s CEO Peter Bauer

Email remains the biggest business app in the world says Peter Bauer, the CEO and co-founder of mail management service Mimecast.

Boston based, South African born Bauer founded his company to “make email safer for business” and after launching in his home country and attracting 14,000 customers and spoke in Sydney about his company and how email is changing in the world of the cloud.

In many respects email is one of those applications – like SMS – that happened by accident. In it’s early days no-one intended or expected those messaging systems to become key communications services.

“I started my IT career in the mid-1990s as an e-mail systems engineer and if you think back to the mid 90s no business cared much about email at all,” says Bauer who believes the experience gave him a unique perspective to how the service evolved into a key business application.

Over the next ten years Bauer saw how email became the personal filing systems for most workers and put systems under pressure as companies had to manage large file stores with the associated compliance and discovery risks.

The security risks too were huge as email became the preferred malware delivery system as virus and spyware writers used infected messages to get onto users’ systems, a problem that has become worse as ransomware and phishing attacks have become common.

“Because business operations and process became dependent upon email, it became necessary to make the service highly available,” says Bauer in emphasising how important it has become to most large and small enterprises.

Even with the shift to the cloud, most companies have remained with email with companies moving to Microsoft’s Office365 – Bauer claims the take up has doubled in the last twelve months. Google’s Apps are gaining traction in the small end of the industry but the enterprises are really wedded to the Microsoft platform.

Bauer sees that shift to cloud based services as changing the risk profile for businesses and this is another opportunity for his business.

Email faces a number of challenges as social media and instant messaging apps become preferred communications tools for younger groups while some businesses are banning email.

For the moment though, it looks like the service is safe as companies remain wedded to email as the preferred form of business communication.

Subscribing to disruption – Zuora founder Tien Tzuo

The shift to a subscription economy promises to change many businesses says Zuora’s Tien Tzuo

“This is a customer driven revolution,” says Zuora co-founder and CEO, Tien Tzuo, of the business shift to a subscription payment model.

While the cloud computing business has been one of the leaders in the shift to the subscription model, the move is happening in industries as diverse as jet engines, agricultural machinery and music.

Zuora is one of the businesses providing the tools to manage customer subscriptions and Tien Tzuo shares with Decoding the New Economy how he sees the subscription economy changing industries.

Tien, who was an early Salesforce employee, describes some of the forces he sees driving this shift and where the opportunities lie for business owners, managers and entrepreneurs.

“We looked at companies like Netflix which at the time it was DVD rental service and Zipcar and saw the same payment challenges we had at Salesforce,” says Tien. “The leap for us was looking at the transformation of companies like Zipcar into a subscription model.”

There are few industries that won’t be affected to the shift to a subscription model, Tien believes, and he sees this radically changing many sectors with Internet of Things providing a huge push towards pay-as-you-go services.