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Digital IT Transformation

Posted on 19. Jan, 2018 by in Cloud, Developement, internet, Open stack, Programming, Uncategorized

Digital IT Transformation
Preparing for the Battle Ahead

By Tracy Corbo

Digital transformation requires organizations of all sizes, across all industries, to adapt to changing expectations regarding business velocity, scale and operational flexibility. Because technology is the catalyzing agent of digital transformation, this process puts enterprise IT in the crosshairs, requiring action to address the inevitable growing pains and strategic re-orientation needed to successfully navigate the journey.

It is no longer good enough to ‘keep the lights on.’ Today technology goes hand in hand with business, and that means leveraging technology advancements to align with business processes to create and retain a competitive edge.

Managing Digital Transformation

Inability to effectively implement and execute on business-IT transformation could soon become one of the most profound costs to enterprise organizations overall, resulting in loss of revenue, poor customer experience and losing ground to competitors that are quicker to adapt to a digital economy.

It is a fine line to balance ongoing business needs with the costs of adopting and implementing new technology. IT leaders must build the bridge between legacy on-premises systems with newer off-premises technologies while meeting security, performance and compliance requirements.

A few of the hot-button issues that came out of 2017 and will continue to be of concern in 2018 include:

  • Public Cloud – Is it the right deployment venue for your workload?
  • Staffing – Staffing shortages are worse in key IT areas
  • Security – IoT presents new security challenges

Public Cloud Is Not the Ideal Venue for All Workloads

The cloud is the biggest disruption – and opportunity – IT has faced in decades. Public cloud offers clear potential benefits, including optimized total cost of ownership, improved time to market, and better performance, availability and security.

While organizations are moving workloads to public cloud, there is no ‘one ring to rule them all’ in terms of the IT environments from which applications, workloads and data will be delivered.

451 survey data indicates that smaller organizations with fewer than 250 employees tend to lean more toward a cloud-first strategy, while larger organizations see it as one of many options to consider.

Public cloud is appealing because it promises to offer:

  • Optimized total cost of ownership
  • Improved time to market
  • Enhanced performance, availability and security

However, public cloud does not deliver on these benefits by default. Organizations should focus on the specific outcomes they need from IT environments (and not on cloud in the abstract) when evaluating the proper execution venues for both legacy and new applications and workloads.

Furthermore, the best execution venue for a particular workload may change over time in-line with performance, security, data locality or operating cost considerations.

Repatriation. Although the ongoing trend is toward moving workloads to the public cloud, it’s not the best option for all workloads. 451 Alliance survey data shows that many enterprises are moving applications and data back from public clouds and into on-premises and private cloud environments. This is sometimes referred to as ‘repatriation.’

Alliance members using cloud computing were asked approximately what percentage of the applications that had been running in a public cloud were moved to a private cloud environment. On average, across organizations of all sizes, 41% of applications that had been running in public cloud had been moved to private cloud environments.

A closer look by company size indicates that this has been more of an issue for organizations with fewer than 10,000 employees. That average drops to 21% for very large organizations because these organizations typically have a smaller percentage of their applications running in public cloud environments.

When asked what the primary drivers were for migrating off of public cloud, the top reason was performance. Public cloud is not necessarily a good fit for all workloads because moving to public cloud does not guarantee the same level of performance that can found in a more controlled on-premises environment.

Best of Both Worlds. Multi-cloud and hybrid cloud architectures that can support workloads across multiple IT environments (on-premises and off-premises, public cloud and private cloud, cloud and noncloud) are of growing interest. These are appealing because they provide flexibility with regard to workload execution and emerging technologies, in addiiton to allowing companies to accommodate compliance requirements.

In the Q3 2017 Cloud Transformation survey, 45% of respondents using IaaS/public cloud indicated that it was of high importance that their IaaS/public cloud vendor provide support for mutli-cloud/hybrid cloud environments.

Skills Shortages Remain Problematic

The influx of emerging technologies has created serious skills shortages and staffing challenges. Recent 451 Alliance studies reveal staffing shortages – and skill deficiencies – in almost every area, including virtual machine administration, server/system administration (including converged infrastructure), database administration, DevOps, security and cloud.

Despite the rise of the IT generalist, organizations still need specialist skills across projects and individual departments. With hiring on the upswing, it is critical to prepare now for future growth in service lines and emerging technologies.

Recent 451 Alliance studies indicate recruiting difficulties across a number of areas – both on- and off-premises. This problem is most acute in areas such as security, cloud and IoT than more mature areas of IT, such as datacenter and storage.

In the case of security, hiring is a problem for 88% of respondents, with 44% rating it highly difficult. This is affecting the adoption of technology, especially in larger organizations, where just over half of very larger organizations say it is having a direct impact on technology adoption.

The two most common solutions for dealing with the skills shortage across most of the IT areas is to either train existing staff or hire third-party contractors. In the case of cloud and IoT, there is a slightly higher tendency to hire new staff – 52% for cloud and 47% for IoT – rather than use contractors.

IoT Creates New Security Challenges

Security remains a top-of-mind consideration for organizations at all stages of cloud transformation, but the focus is shifting. Security is no longer simply a technology problem to be solved; it is now a broader structural issue as organizations begin to retool traditional (fragmented) approaches and develop cloud-first security models.

IoT is a particularly challenging environment for security. IoT devices represent an entirely new concept of endpoint, even as the security industry hasn’t yet solved endpoint security for the PC or mobile phone. Because of the limited computational and storage capabilities of these IoT devices, a number of the traditional approaches to endpoint security, including installing monitoring agents, will probably not work.

Respondents that are using data collected from endpoints were asked what their highest-priority initiatives were with regard to IoT deployments, and IoT security is first.

When asked about their biggest IoT security concern, respondents indicated that poor authentication of endpoints and application security vulnerabilities within the IoT systems themselves are of greatest concern.

IoT devices can be difficult to patch once in the field, and many manufacturers seem determined to relearn basic security concepts – as exemplified by last fall’s Mirai botnet attack on Dyn (a DNS provider now part of Oracle) that caused disruptions for a number of major websites, including Amazon and Twitter.

Many of the IoT devices used in this massive DDoS attack, including IP cameras, provided remote access through a dated protocol, Telnet, and used default passwords for access, making infection a trivial effort.

Patching firmware and default passwords or poor authentication is only part of the design challenge with IoT. There are also issues around the physical insecurity of endpoints, securing communication between IoT devices and the network that supports them, and protection of the data stores capturing reams of information from devices.

When respondents who are concerned with physically unsecure endpoints were asked how they plan to manage endpoint security, 55% said they hoped to be able to do so within the next year.

The Road Ahead

451 Research defines digital transformation as the result of IT innovation that is aligned with and driven by a well-planned business strategy, with the goal of transforming how organizations serve customers, employees and partners; supporting continuous improvement in business operations; disrupting existing businesses and markets; and devising new businesses and business models.

One of the principal reasons companies are struggling to become or remain competitive is the lack of differentiation in their own corporate structures and processes – the skeleton and organs giving shape to their organization do not easily yield to change. Most companies, broadly, consist of the same kinds of front-, middle- and back-office departments; are staffed by the same kinds of roles; are mediated by the same kinds of internal process; and are governed by the same compliance and regulatory considerations – all based on publicly available technologies.

We are in an era of digital revolution, where competitive advantage depends on how well we use the enterprise digital infrastructure, and how we utilize the business applications and massive amounts of data flowing across it. Every company is becoming a software company – some just don’t realize it yet. But those that do are digitally transforming themselves to take advantage of cloud computing at scale, advanced analytics, massive amounts of data coming from every connected device, and the power of AI and machine learning to derive insight from that data and drive better decision-making.

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