In my previous blog post I started exploring what a cloud broker is and how it requires managing the partner network. The concept of broker leads much further though. A couple months ago I was challenged by one of my clients to describe the vision of IT as a Service Broker. I spend some time pulling the vision together and shared it with him not that long ago. He was impressed, he told me.
Here is what I told him, but before doing that, let me take a minute to define the term service as this word is extensively used in combination with cloud, but seldom truly defined. I went back to basics and defined it, courtesy of TechTarget, in following way: Cloud services covers a wide range of resources that a service provider delivers to customers via the internet, which, in this context, has broadly become known as the cloud. In the Digital Economy you have three players, the consumer, who uses services he gains access to through a broker. The broker either delivers the services himself or connects the consumer with an external provider that delivers the service, or parts of it (remember intermediation and aggregation in previous blog post). The characteristics of the cloud services include self-provisioning and elasticity; in other words, consumers can provision services as needed, on an on-demand basis and shut them down when no longer necessary. The provider(s) ensure sufficient capacity is available for the consumer to use the service as needed. Consumers typically subscribe to cloud services, and pay on consumption, rather than pay for software licenses and supporting server and network infrastructure upfront.
Consumers are not interested in shopping for services all over the internet, they want a single point of entry from where they get access to all the services they need regardless where they are ultimately sourced from. That is precisely the role of the broker, being the “storefront” from which you can consume the services needed when required without limitation on the quantity consumed. Obviously there will always be a limit, but that limit should be large enough that it does not hinder the consumer to do its business.
Aligning services to create new business models
The second element that leads to the thinking of service brokers is the concept that business processes are changing more often than elementary transactions. Today business processes are mostly embedded in applications as are elementary transactions. Twenty years ago, data was also embedded in the same environment, but the separation of code and data lead to a new industry, the database.
Today, separation of business processes and applications can be achieved through the use of a business process management system. Applications then turn into services that are invoked by the BPM system. That’s why microservices and other such technologies are getting popular these days. They enable the consumption of services and new business models can easily be set-up by the combination of existing services in a new way to address client demand.
As the business experiments with these new models, it is expecting IT to respond quickly and make available new services at a fast pace. Here is where the broker comes in. Not all new services need to be developed, some may just be sourced from other providers. You remember the discussion we had several months ago around how to manage the evolution of a portfolio of applications?
IT becomes a partner to the business
In most organization IT is considered a supporting function. This results in IT being kept unaware of the strategic thinking, of the key discussions of the evolution of the enterprise. In a world that is increasingly digital, where every object interacts through the internet of things, IT is no longer in support of the business. Business and IT are the two sides of the same coin.
This implies we can no longer have an attitude of “us and them”, we need to combine understanding of business requirements and technology to look for an optimal approach. The new consumption models the cloud enables allows for the development, the acquisition or the consumption of services. This requires a clear understanding of what fits where, resulting in a resurgence of enterprise architectures and standards. And all of this needs to work at the pace of the business requiring agility and speed. IT needs to become service oriented instead of technology based. IT also needs to work with suppliers rather than doing everything themselves. As you can imagine, this requires IT to change fundamentally.
Accelerate Time to Value requires a new approach
In tomorrow’s IT change is the only constant. More channels of interactions need to be developed with clients, prospects, partners, suppliers and employees, but more channels mean more possible threats. New applications and landscapes should be supported, supporting the latest trends in IoT, social media, mobile and cloud. All of this needs to be implemented while digitizing the enterprise. This leads to a series of guiding principles:
- The digitization of the business needs to be empowered. In other words, think digital first.
- Leverage deep industry expertise and skills in emerging technologies, have business and IT people working jointly on new projects to cross-fertilize thinking.
- Build on integrated solutions across hardware, software, services and applications. Think integrated, ensure the use of APIs and manage them properly
- Operate globally and at scale. The internet has no boundaries so most enterprises become global by nature, have that thinking embedded in the organization.
- Innovate with trusted partners. Don’t try to do everything yourself, but think out of the box and involve partners you can trust to expand your knowledge of markets, technologies and industries.
- Respond with flexible and agile models. Speed is of the essence. Don’t build the Rolls-Royce, build your solutions one step at the time and test each step out within the market as soon as built.
- Re-use as much as possible. You remember “Innersource”? Implement it in your enterprise and ask yourself what you can re-use or fork from rather than redevelop things from scratch.
Think through your value chains
IT’s activities are basically focused around two value chains, a development and a consumption one. The development value chain manages the creation of new services through the development or acquisition of services, or through the onboarding of an external service provider. End-users will consume service instances on a continuous basis and IT needs to ensure they can do so. That implies the management of the external providers as well as the operations and management of the internal services. Such thinking will lead you to some basic questions. Here are a couple:
- In what you have today, what stays and what goes?
- What do you put in the cloud and in which cloud?
- What needs to be transformed, what can simply be moved? What methodology and tools should you use in the process?
- What do you migrate and what do you rebuild?
- How fast can you get there?
- How should you minimize the impact on the business
- How do you manage your service suppliers?
Becoming a Service Broker needs careful planning
To become a service broker, truly part of the business in a digital enterprise, careful planning is required. It starts by getting business and IT aligned. We tend to do this through a workshop to which we invite both business and IT. Using a simple business process as example, we go through the exercise of defining what services are required to support the business process, which application delivers the functionality and what infrastructure is required to run the services. This leads to a common understanding of the journey you will have to go through and allows you to create a common vocabulary facilitating discussions between business and IT. In the next blog entry we will discuss the management of service providers as this becomes key in such approach. Good luck on your journey to the digital enterprise.