In today's frenetic economy, woe to any enterprise whose IT organisation isn't mentally resourceful and swift in action and thought: in a word, agile.
A former statistician at the Australian Bureau of Statistics used to famously claim that it was easier to kill a black snake with a bit of balsa wood than to stop a survey. CIO Jonathon Palmer believes exactly the same can be said about retiring existing systems.
The ABS has hundreds of applications in its software portfolio, ranging from the large and complex to the relatively small and straightforward. Palmer says that having to cope with that vast portfolio of applications over many years has forced the bureau to confront the need to make software as flexible as possible. As CIO, Palmer knows that as difficult as planning the retirement of those applications can be, smoothing their retirement is vital to software agility.
"Retirement of applications is an important ingredient in building agility. It is also a difficult issue because the last user has got to leave the building before you can turn the thing off, as it were," Palmer says.
However, considered and carefully planned retirement of applications is but one component in building software agility, and that elusive goal is one that many organisations would love to achieve.
"I think everyone is working towards software agility," says SRG Data Sell director Ken James. "We're moving along the path, and we can see that we're moving, which is a good thing. Mind you, we'll probably never get there - like no one will ever get there - because every time we change something, we need to change it again the next day."
Software agility goes to the organisation's ability to change and update software quickly, with a direct impact on the business's revenue and profit. Getting it right creates dramatic, long-term business advantage, such as making it easier for organisations to tailor IT systems to meet the challenges of e-business. After all, what challenge could e-business possibly pose to any organisation with truly flexible IT systems?
"Organisations that can change and update software, business applications, Web content and, consequently, business models, can create significant business advantage with software agility because changes in the software are changes to the business," wrote former GartnerGroup analyst Ray Paquet in Gartner's recent report Software-Enabled Business Agility.
That's the flexibility all organisations need if they are ever to realise their e-commerce and e-business strategy, particularly as long as e-business remains a rapidly evolving paradigm that is constantly reinventing itself.
Why is Barnes & Noble chasing Amazon.com? Because of Amazon's agility in the e-commerce world. Paquet sees software-enabled business agility as true competitive advantage.
There's never been more of a need for, nor a better payoff available from, software agility as business fights the increasing rate of change in business conditions. The exponential expansion in competitive perils means only the most agile businesses can hope to compete, survive and thrive.
"We define agility as speed and the ability to change quickly," says Greta James, Gartner research director, application integration Asia Pacific. "We see that primarily affecting software, but also process and organisation, and we recognise it as having four key factors. There's technology, which is primarily software; IT processes, the IT organisation and architectures. They're the four key elements organisations need to become more agile."
Forrester Research recognises three types of agility, each supported by different IT capabilities that build on one another: responsiveness, pacesetting, and game changing.
"To be responsive, IT needs to deliver proven technologies used in best practices. Pacesetters must have the execution environment that supports responsive agility - plus tools and processes to uncover and act on new opportunities. Game-changing IT is ready for dramatic upheaval by upping the ante with organisational flexibility and process design skills," Forrester says.
Stovepipes and legacy systems remain a bugbear for many organisations, Gartner's James says. However, the evolution and maturity of integration technology over the last five years has made it less of an issue than it was. James says integration technology has been given a huge boost by e-business, which brings with it a need for far greater agility.
"And the impact of the economic downturn is interesting as well, in that traditionally in Australia we've battened down the hatches. But Gartner contends that this is a terrific opportunity to develop greater agility and to invest in the infrastructure that allows you to do more with what you've got," she says. "Application integration should be used more extensively by enterprises in an economic downturn because it allows them to use what they've got today in new and different ways."
However, a GartnerGroup survey conducted at the end of last year shows Australia is lagging by up to 18 months behind the US and Europe, particularly in B2B integration. James says one reason is that there has been a huge push towards supply chain integration overseas, whereas Australia lacks an extensive high-tech manufacturing base. "Now traditionally, there has been a lot of integration in financial services and health care and, yes, we're doing it to some extent in banks and health care organisations. However, the market taken as a whole is somewhat behind Europe and North America," she says.
Be Nimble, Be Quick
At OneSteel, the spin-off from BHP Tubemakers, globalisation poses a significant challenge to competitiveness. The new organisation knows it must move quickly with the market to provide whatever services the market is demanding and also to differentiate its product. For the new organisation, agility means ensuring financial systems are capable of managing a new business environment. To ensure this, OneSteel is implementing the JD Edwards OneWorld financial reporting package and enterprise resource planning system based on Oracle.
"We need agility because the marketplace is changing on us all of the time," says Allan Strong, OneSteel manager, information systems. "Globalisation is a major problem for us in terms of competitiveness, and we have to move quickly with the market to provide whatever services the market is demanding and also to differentiate our product, because our product, steel, is very mature."
For the IT organisation, agility also means gearing up to reuse software rather than to write it afresh each time. Traditionally, organisations have built much of their application software from scratch. The key to agility is reusing both existing software assets and those that have been acquired in the form of application packages. In the agile organisation, the emphasis is far more on integration rather than on application development.
However, Gartner's James says the innate conservatism of Australian business has typically made it difficult for IT to convince the business to invest in the infrastructure that would allow this agility, including integration technology, integration middleware, and the training of staff in new technologies like Java and XML. She says making that business case is usually easier when the CIO is part of the CEO's gang. The CIO needs to be seen by executive peers as not just a service provider but a member of the team who can open up and participate in exploring new business opportunities.
Planning for Retirement
Despite the efforts of many organisations to ensure they are more flexible, Paquet sees a fundamental discontinuity in the way they approach IT. "About 80 per cent of applications will be replaced or upgraded in the next three years, but no one plans for the retirement of their software," Paquet says.
The term "no one" here is clearly an exaggeration. Certainly the ABS does just that, acutely conscious of the importance of phased retirement to its ability to be flexible in all things. But Palmer says the ABS is equally conscious of the need to satisfy business owners when software is to be retired.
"The thing I often find trickiest is if you're migrating an application just because it's too old, the business owners of the application never get very excited about just replacing the same thing. They would rather not hear that they have to redevelop it because we can't support it any more. They really only get interested in redeveloping if there's prospects of re-engineering the business process or delivering some new benefits."
To ease their pain Palmer, and his team generally try to ensure that they re-engineer before decommissioning applications when there is an ongoing need for the functionality concerned. "We don't just rebuild the same application, we have to rethink the business process so that you actually get some benefits out of this decommissioning," he says.
The ABS does tend to manage retirement fairly gracefully in most cases, Palmer says, largely because it has an abundance of skills and plenty of stability in staffing and because it does consistently try to re-engineer the process to ensure there are benefits from decommissioning.
So while Palmer faces the forced retirement shortly of a key application, he is confident of being able to rely on existing staff to understand the system well enough to keep it going for another year or so. "That's a key part of software agility," Palmer says. "The last thing you want to have to do is be forced to turn these things off instantly."
Every Last Drop
Software agility positions the organisation both to meet existing needs and to evolve to address future requirements.
Learning how to squeeze as much as possible from the agile software that does exist is a major iron in SRG Data Sell's fire as it strives to provide its clients with the agility they need. "That means learning how to use it properly then developing applications to educate the market and our clients and their clients about what is possible," SRG's James says. "Because once people know what applications they can use for agile software, they then automatically think up new ones."
A division of the Simon Richards Group, SRG Data Sell runs call and contact centres as an outsourcer and offers a range of services providing a "one stop" personalised direct marketing service for any business. It operates from two sites in Port Melbourne, with a site at Fennell Street servicing primarily integrated clients of the Simon Richards Group, and a larger site at Bertie Street handling direct project work and ongoing activity from external consultants and agencies.
Agility for the company means positioning itself as being able to provide state-of-the-art responses to market needs for contact management. "It means being able to handle contacts via the Web or phone or fax or any other method of contact that people can use electronically, and integrating them into a system that can measure them together for the tracking of the history of a customer or a transaction," James says.
SRG Data Sell started its operations without software many years ago, then introduced software to work with the normal phone system and integrate customer contacts. It recently upgraded to the new customer interaction centre from Interactive Intelligence. "That allows us a bit more flexibility in how we do things because we can integrate a whole range of unified messaging applications," James says.
The company has a small group of people who devote their time to building applications and integrating the new software into old projects and old systems to see how they work and find ways to better use them.
"They have to know the software inside out to think of a better way to do it because they have to know what it can't do as well as what it can," James says. "And there's a lot of stuff people are using overseas, that people are testing, that we can't actually do here yet - such as voice over IP that we're trying to plan towards as well."
Custom-Built for Agility
At the ABS, most of the hundreds of applications have been custom-built to meet statisticians' needs and also written with the need for agility in mind. From Palmer's perspective a key to building software agility is to build end-user-driveable applications using high-level languages and to try and put a lot of the fine-tuning in the hands of the end users by making them parameter- or end-user data-driven. In fact, way back in the sixties, the Bureau wrote table-generating software that delivered a high-level language into the hands of end users so that they could specify and generate their own tables. In more recent times, it has developed highly generalised systems for things like estimation and data editing and data input.
"We've got a long history of building highly generalised solutions which often are meta data-driven or end-user driven and designed so that in many cases the end users can manage a lot of the parameters that drive the system," Palmer says. "An example might be a system for editing some statistical data. The edits may be specified in a high-level language that the end users can modify for themselves. That means that you don't need to get a programmer to modify the application, the end users can modify those things themselves."
Construct those applications right, he says, and they don't require programmer-like skills to drive, although they do require people who aren't afraid of the technology.
In addition, Palmer says adopting high-level languages that give good programmer productivity, and embracing object-oriented technology and sharing class libraries are other important elements. The ABS started using high-level languages years ago, working not only Adabas Natural and others of its ilk but even developing a high-level language for end users to write in called Pleat - Procedural Language for Edit, Amend and Tabulation.
"We make really extensive use of Lotus Notes, which we have used intensively for nearly 10 years," Palmer says. "Many of our applications are either written completely in Notes or the interface component is in Notes, and I think there's a few interesting things about Notes that let you become very agile."
That includes the fact that the code for any of these applications tends to be well packaged. As a designer, you click on the same icon a user clicks on to invoke an application to get access to the complete design of the application. It might sound simple, Palmer says, but having all of the design easily accessible and in one package has proven really important when it comes to modifying applications.
The ABS has also adopted common approaches to developing all of these applications so that what the programmer or developer encounters seldom seems new or different.
All Tied Up
Hydro Tasmania faces significant strategic business issues in the years ahead, including increased use of natural gas and wind generation.
According to senior management accountant Robbie Lehman, the organisation used to run a combination of five or six different vendor software products and had developed interfaces in various instances to tie them together. Now, like OneSteel, it runs the JD Edwards OneWorld financial reporting package and enterprise resource planning "The previous set-up was very complex and few people could understand the full picture," Lehman says. "Sure enough, OneWorld is a big system and our people are still learning, but it's much easier as far as resources go.
"You know, if we needed something done to our old system there were probably precious few people who could come in and do something for us. We relied on one or two in-house experts. Now, although we pay for it, we can use our own resources, we can use JD Edwards' resources, or we can use their business partner in Tasmania. So for the longer term we have got a little more flexibility as far as what we do there, as well."
Lehman says the organisation has some issues with OneWorld - things it needs to tweak and improve and a range of problems. But the software has given the organisation a good, single repository of information. Hydro Tasmania's software agility depends on it, he says.
If You're Not Part of the Solution
Since the very core of e-business relies on rapid transformations in the way an organisation manifests itself to its markets, an e-business solution that can't allow for constant change is no solution at all.
As IT departments make the transition from technology shops to service providers, a first step to achieving agility is to improve the communication between the developers, the business units they are serving and the operations groups that will have to provide the infrastructure for the new systems.
"We've always had a model that is not too bad, not too distant from the business," SRG's James says. "I mean our IS department is really a pack of business analysts rather than a swag of backroom nerds. We suffer with the business."
No IT person can learn to understand the business requirements if they are locked away in a computing ivory tower, James says.
"If you're getting beaten around the head every day with complaints that we didn't get a customer or we couldn't get our prices down because we didn't know what out information was, and you have intimate contact with the sales/marketing people, your ability to move is a lot higher. That's because you understand what's pressuring them."
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