Saturday, May 23, 2015

Thinking of the As-a-Service Economy

I have really tried hard to understand the  emerging As-a-service economy. I am glad to say that I think I now understand the term better and agree that things are evolving in that direction. Let me explain what I have understood in my words.

Organisations use business service catalogues delivered to them through a mix of people and technology. Typically the business service catalogue has a back-to-back IT service catalogue. Business staff orchestrate the business services from the catalogue into business processes achieving business outcomes. IT staff orchestrate the IT services from the catalogue to support the business services. The agility (through flexible capability and flexible capacity) of the above business processes (and recursively those of its business services and IT services) and their cost are key to business success/failure. Business always wants more agility and ever lower costs. Depending on the people and technology portfolio of each organisation, its agility and cost get determined.

The As-a-service Nirvana is that the people portfolio is highly skilled, good at learning-unlearning-relearning and value-add focused supported by a technology portfolio which provides flexible capability and capacity. In the As-a-service Nirvana these are delivered through the IT service catalogue, business service catalogue forming the business processes supporting the business with a high degree of fast flexibility to vary services their providers as per the needs of the business to produce specific outcomes in the context of its business environment. The most important point about the As-a-service Nirvana is that it assumes a huge amount of automation and a huge amount of cloud usage, so that the cost structure options that BPaas/SaaS/Iaas can deliver are leveraged to the full.

Why is this important what is new about this?

Till date, the focus has been on each customer making one-time and on-going investments (and/or expenses) in infrastructure, software applications and (IT and business process) staff which tied up capital, made reducing people cost through offshoring/outsourcing the only way of reducing cost and reduced agility due to high cost/duration of change. It is a bit like building, maintaining and driving one's own manually driven car using T&M/Fixed price service and standard components and being locked into it when all you need is a car and Avis/Hertz can provide on-demand selection of car's with various configurations (including more automated self-driving ones) for a much lower operating cost overall. The key difference between this example and As-a-service Nirvana is that Avis/Hertz in the As-a-service economy will assemble the "car" on-demand from services provided by multiple providers and the next time you need a car, you can change any of these providers easily.

As I described in this article I think that things are moving towards utility computing provided through "standardised access" infrastructure just like electricity. Everyone does not need their own power generation, transmission infrastructure to use electricity. "Standardised "access" infrastructure is enough to leverage flexible computing as described in that article. As we reach there enterprises will primarily interconnect multiple "standardised access" infrastructure elements which separately/jointly plug into the computing coming through the wall. It is basically a more evolved way of living and it will locate the responsibilities in a more socially optimal manner.

Regards

Pratap Tambay

23 May 2015
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