Tuesday, January 31

Changing CIO priorities

Over the last year there has been a distinct evolution in business expectations from CIOs. This change is evident through the Gartner CIO 2006 survey where the top 5 priorities are 1. Business Process Improvement 2. Controlling costs 3. Attracting and growing customer relationship 4. Improving competitive advantage 5. Improving competitivness.

These priorities have clearly evolved from last years priorities which were 1. Business Process Improvements 2. Security 3. Costs 4. Supporting competitive advantage 5. Data protection & privacy.

These trends will accelerate over this year and CIOs will be expected to leverage technology and truely deliver business innovation. Over last few years IT departments were expected to streamline operations and reduce costs. While the pressure on costs still remain and wider economic risks still loom in the horizon, achieving business growth is back on boardroom agenda and this will trickle down IT departments in form of expectations for new applications, services & infrastructure.

The one clear area of opportunity for IT to deliver on these expectations is customer relationships, customer interface, front office capabilities. CIO have to look beyond their enterprise silos and immerse themselves in some of the amazing ways users, customers are using the web. Refer to my earlier post on "Future of Marketing". These trends are best appreciated through first hand experience. Are you a blogger, are you linkedin, where are you in myspace, did you check out that podcast, how do you search for information etc. etc.

CIOs are in a unique position to seize initiative and show leadership across functional boundaries of marketing, operations, HR as the next wave of business innovation will be technology led.

Wednesday, January 18

Web 2.0 Meme

"Web 2.0" is one of those overhyped terms that started as a vacuous concept yet the popularity it has gained over last one year makes it a useful term that marks a milestone in the evolution of the Internet/web.

Tim OReilly, orignator and chief evangelist of Web 2.0, tries to articulate the principles governing Web 2.0 as being

1. Web as Platform: Web Services, Mashup sites, software-as-service
2. Long tail Business Model: Instead to targeting the few big fish, build for millions of small ones
3. Harnessing Colletive Intelligence: Network effects, folksonomy, wisdom of crowds
4. Ease of building mashup websites make data and content ownership critical to maintaining competitive advantage
5. Software products morph into software services
6. Ajax: Asynchronous data retrieval

There is an interesting discussion on the definition of Web 2.0 here

To me the key insight in following the trends that constitute Web 2.0 is that it is not about "cool, bleeding edge" technologies rather every successful example of Web 2.0 implementation/example provides its user the ability to create his/her own experience as an individual or as part of a community.


Google redefined "relevance" of search results from being output of "sophisticated computer algorithms to collective judgement of human web authors

Amazon allows users to create unique experiences for themselves

Ebay is a community co-created example of online marketplace as opposed to uninspired B2C websites

myspace.com, Wikipedia, Flickr, BitTorrent, Napster, blogs etc. each is an example that allows users to create unique experiences for themselves

In my opinion ability to co-create should be the central insight of Web 2.0, while principles put forth by Tim above only contribute to realizing this central concept of co-creating experiences

The book that put forth this idea of Co-creation is : The Future of Competition: Co-creating unique value with Customers by C. K. Prahalad, Venkat Ramaswamy

Wall Street Tech Stories

Current market capitalization of companies is a function of future expectations. It is the best mechanism of quantifying the (smartest) collective judgement of people who are voting with their money.

Below is a market cap (as of Jan 18 2005) of key competitors and they do tell a story

Dell vs. Apple

Apple: $71.39B (Revenue: $13.93B)
DELL: $71.5B (Revenue: $54.18B)

Apple has a future, Dell might not

Oracle vs SAP

Oracle: $64.22B (Revenue $12.89B)
SAP: 56.94B (Revenue: $9.9B)

It's a tie

Google vs. Yahoo

Google: $138.05B (Revenue: $5.25B)
Yahoo: $56.91B (Revenue: $4.83B)

Advantage Google

Microsoft vs IBM

Microsoft: $287.3B (Revenue: $40.34B)
IBM: $131.10B (Revenue: $94.28B)

Products is a better business than Services

IT services

Accenture : $17.55B (Revenue: $17.57B)
EDS: $12.71B (Revenue: $20.51B)
Infosys: $19.82B (Revenue: $2.01B)

Infosys has beaten Accenture & EDS

Google vs. Microsoft

Google: $138.05B (Revenue: $5.25B)
Microsoft: $287.3B (Revenue: $40.34B)

Who Knows??

Thursday, January 12

Bangalore floods on Hosur Road Oct 2005

Floods in Bangalore

Photos on flickr.com

Future of Marketing is now

Effective Ads, Viral Marketing, Communities or social networking, Co-creation

1. Ubiquitous, contextual, granular ads everywhere (Online, Mobile, Print): www.google.com
2. Viral marketing: Buzz-oven
3. Communities or social networking: www.myspace.com , www.milliondollarhomepage.com
4. Co-creating experiences: www.converse.com

Portfolio Approach to SCM

An old article of mine published on CIO.com

A Portfolio Approach to SCM

Seamless collaboration with complete information sharing between all supply chain participants is still in the future. But there are strategies to dealwith the current transitional state to help you come out on top today.

Link to article

Wednesday, January 11

IT imperatives beyond strategic alignment

Article I wrote published in Handbook of Business Strategy

While enterprises across the board have identified significant productivity improvements, and realized substantial improvements in consumer surplus using Information Technology, there has been little evidence of significant positive impact to sustainable business profitability. While IT systems so far have provided operational benefits and enhanced consumer experience, unless managers take care to go beyond strategic alignment of their information infrastructure investments to ensure architectural flexibility and constantly optimize IT delivery efficiency, they will begin to see diminishing returns from IT as the pace of business changes increase.

Link to paper

ROI is not a formula, it is a Responsibility

Article I wrote sometime ago and was published in Journal of Business Strategy

Ronald Reagan once famously said of government, “Just like a baby – an enormous appetite at one end and no sense of responsibility at the other.”

Excessive amount of ink has been devoted (in trade publications, marketing brochures and analyst reports) to help a CIO calculate “Return on Investments.” Methods recommended include, simple Cost-Benefit Analysis, IRR, Discounted Cash Flows, Total Cost of Ownership, EVA and real options. Among all this mumbo-jumbo of numbers and formulae, one loses track of the most important factor that will ensure “returns” on your investments, that is, “Accountability.” This paper lays out a framework to assign responsibility for various types of IT investments to ensure that you realize the projected “rosy” ROI numbers that any of the above formulae throws up.

Link to the paper

IT+BPO Combined Power

Integrating IT and Operational Resources for Continuous Improvement
By Krishnan Narayanan & Jacob Varghese

Managers have to look beyond the myopic silos of business transactions, IT applications and infrastructure and take a holistic view of business processes that includes all three components

As organizations begin to focus on generating long term value from offshore outsourcing, the emphasis has shifted from tactical cost reduction to sustainable continuous business process improvement. This has triggered a number of discussions about the merits of combining IT and Business Process Outsourcing (BPO). So far managers have made a clear distinction between outsourcing operations vs. IT systems within business processes. Since outsourcing has been viewed as a tactical make vs. buy decision, businesses have ended up outsourcing components of a single business process to disparate service providers. What are the relative merits of an integrated IT and BPO approach? How it can be achieved for optimal results?.

Link to paper

Patents vs Open Source to Patents with Open Source

US Patent office to partner with the open source community to improve quality of software patents.

Key Points

1. Open source recognized as prior art. A consortium including IBM to build a searchable database of open source

2. Public can send emails on review of patent applications to identify prior art

3. Development of patent quality index http://www.patentqualityindex.org/.

Monday, January 9

From Computerworld

Ray Kurzweil: IT Will Be Everything: "Future Watch: AI pioneer Ray Kurzweil looks out across the century and sees a wondrous but at times frightening world, where technology is everything and we have computers in our brains. "

From Amazon

Ray Kurweil referred to as "technology's most credible hyberbolic optimist" author of The Singularity Is Near : When Humans Transcend Biology ("the singularity," a reference to the theoretical limitlessness of exponential expansion) that will see the merging of our biology with the staggering achievements of "GNR" (genetics, nanotechnology and robotics) to create a species of unrecognizably high intelligence, durability, comprehension, memory and so on" quote from Amazon editorial review.

I have not read his books but a quick google has left me curious, given he is one of the 5 advisors to the US military on advanced technologies. (Who are the other 4?.) Would he have addressed issues from social, cultural, ethical, philosophical dimensions or would it be Moore's law exaggerated & extrapolated to everything. E.g. check out Omnipotence paradox
Best books of 2005: (Amazon)