CIO Asia April/May 2015 by Executive Networks Media

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10,000 mobile transactions happened while you were reading this headline. That works out to over 197 million mobile transactions a day, worldwide. And customers expect every checkout and check-in to go off without a hitch. 40% more powerful than before, the new IBM z13™ is built for what today’s customers want. Built for mobile. Built for apps. Built for cloud security. Introducing a new generation mainframe – IBM z13. Learn more at ibm.com/zsystems Visit us at ibm.com/systems/sg/z or contact IBM at 1800 3172 782 (Singapore Toll Free) or direct@sg.ibm.com

40% is a comparison against prior generation. IBM, the IBM logo, ibm.com and z13 are trademarks of International Business Machines Corp., registered in many jurisdictions worldwide. See current list at ibm.com/trademark. © International Business Machines Corp. 2015.

WHAT’S ON www.cio-asia.com Four Resource Centres for Information Executives

Executive Networks Media offers four distinct individual websites to benefit you, our subscribers and to maintain an Internet presence. They host a comprehensive set of social networking, feedback, search and multimedia features. The websites represent specific brands under our umbrella of media properties, including CIO Asia (www.cio-asia.com), MIS Asia (www.mis-asia.com), Computerworld Singapore (www.computerworld.com.sg) and Computerworld Malaysia (www.computerworld.com.my). Our greater digital media focus includes 20 weekly e-newsletters, expert blogs, features and breaking news, drawing upon the global content produced by more than 300 IDG magazines. Here is some of our latest Web-exclusive content: Leadership & Management IT leadership: Signs you’re a micromanager (and how to stop) Micromanagement might not appear to be a big deal— you’re just trying to make sure tasks and projects are on time, done right and in ways that will benefit the business, right? But the truth is, it’s incredibly damaging to every aspect of a business. http://bit.ly/1DDUl8R

Mobility and IoT Five takeaways for CIOs from this year’s MWC Here are some of the trends and announcements from this year that will have an impact on enterprise mobility. http://bit.ly/1x7ls9T

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COVER CIOs: From Tech to Relations Our 2015 State of the Asian CxO survey brings some interesting answers on the CIO’s role, and the hot areas they need to focus on.

FEATURES BIG DATA CIOS HAVE TO LEARN THE NEW MATH OF ANALYTICS Today’s data-driven business runs on the almighty algorithm. But if you’re not careful, those geeky formulas can stir up legal and ethical trouble.

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FIVE THINGS TO KNOW ABOUT HYBRID CLOUDS What are hybrid clouds? Should you be too concerned about its definition and application?

INTERVIEWS ENSURING A SUCCESSFUL CLOUD JOURNEY Conversation with Kerrie Holley, IBM Fellow and Master Inventor, who is also a business-savvy, technology executive and senior IT architect.

THE HYBRID WAY TO MANAGED SERVICES We caught up with NTT Communications’ Theodoric Chan and Chris Sandoval recently to talk about IT outsourcing, hybrid clouds and demand for managed services in Asia.

Data Analysis 5 steps for transforming your business using data Here are five steps digital leaders like you should take to become data champions. http://bit.ly/1xDShpO

Cloud Computing CIOs share lessons learned from the journey to the cloud The journey to the cloud can be fraught with peril and unexpected pitfalls, but many companies have undertaken to make it anyway due to the promised benefits from agility and scalability to cost reduction. IT executives who have successfully navigated the dangers have learned many lessons along the way. http://bit.ly/1I34v1r

Careers 9 networking tips for introverts Networking, whether during a job search or simply to maintain professional connections and grow your network, can be stressful, even for the most outgoing, extroverted job-hunter. For an introvert, however, the process can be downright paralysing. http://bit.ly/19EnrIN

EVENT REPORT CIO-NTT TECHNOLOGY OUTSOURCING FORUM 2015 Organised by CIO Asia and supported by NTT Communications, this event aimed to let attendees learn more about the trends, the how’s, what’s and why’s of IT outsourcing from industry experts.

DEPARTMENTS 01 What’s on www.cio-asia.com 04 Editor’s Note 06 Trendlines Five steps for transforming your business using data | Nearly half of Asian governments will utilise cloud by 2018: Microsoft | How DevOps can redefine your IT strategy | Driverless cars will spur development of robots: McKinsey | Google, Facebook racing for virtual reality launch | SCS crowns IT Leader Awards 2015 winners | Five takeaways for CIOs from this year’s MWC | Survey: Users hate lack of privacy controls on Internet 44 Datapoints

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Dell and Red Hat Modernize Yale-NUS College’s Data Center Earlier this year, Gartner released its 2015 CIO Agenda Report, a global survey which reported that one of the top investment priorities for CIOs is the data center (DC), with a projected 37% increase in spending this year. In Singapore, some organizations’ data center investments have been earmarked for the shift towards software-defined data center (SDDC). Among them is Yale-NUS College, a liberal arts college established in 2011, which chose to work with Dell and Red Hat for its SDDC project.

Raju Chellam, Head of Big Data and Cloud at Dell South Asia discusses how Dell and Red Hat supported Yale-NUS College.

What were the factors that encouraged Yale-NUS College to make the shift to an SDDC from a traditional DC? Let’s first define SDDC from a technical perspective. SDDC is where control of the DC is fully automated by intelligent software, allowing the hardware configuration to be fully maintained through a single interface. The aim is to achieve IT as a Service (ITaaS). All key DC resources (servers, storage, networking, CPU usage and data security) are virtualized and delivered as a service. The SDDC trend is real and is being implemented by DCs in most developed economies. For example, IDC expects the market for Software-Defined Networking (SDN) to cross US$3.7 billion by 2016, from US$360 million in 2013. IDC also estimates that the Software-Defined Storage (SDS) market will grow faster than any other storage market. The SDDC concept is ideal for organizations that need to expand exponentially quickly. The Yale-NUS College is a typical educational institution where the DC needs to deliver higher workloads every year. Without SDDC, the average annual capital expenditure (CAPEX) will be unsustainable. Moreover, unlike traditional DC where all the components (servers, storage, networking, security) are disparate and work in silos, SDDC works by integrating all the components and managing them from a single dashboard. Why did Yale-NUS College choose to work with Dell and Red Hat for this project? How did it solve its pain points? Yale-NUS College opted for Dell and Red Hat because of proven integration between the hardware components (from Dell) and the software solutions (from Red Hat). Yale-NUS College needed open, standards-based infrastructure that can scale-up and -out based on workload demands; capable of running some workloads in-memory while moving others between virtual and physical servers, and importantly, solutions that deliver the best ROI and feature set. Yale-NUS College found the Dell-Red Hat partnership to be the best to help it shift to SDDC from the traditional DC.

Which solutions have been deployed? Yale-NUS College deployed: • Dell servers, storage and networking optimized for Linux workloads and certified by Red Hat. • Red Hat Enterprise Linux OpenStack Platform, an Infrastructureas-a-Service solution that can scale to tens of thousands of systems with proven reliability and integrated for enterprise cloud functionalities. • Red Hat CloudForms, a unified, flexible cloud management platform that helps control virtual platforms, cloud platform and public cloud services access within the SDDC. • Red Hat Satellite which offers complete lifecycle management of Red Hat systems with provisioning software distribution, patch and configuration management across physical, virtual and cloud environments. The entire solution allows for rapid deployment. It has reduced deployment time by 80% and offers greater flexibility as there is no need to commit to a certain amount of storage upfront. CIOs want more efficiency from their DC investments. Higher efficiencies in the DC can only be achieved by deploying SDDC. According to Darwin Gosal, Head of IT Services, Office of Educational Resources and Technology at Yale-NUS College, “The Dell-Red Hat solution has given us greater capabilities and agility in our IT operations without allocating too much resource. We Brought to you By can spend less time on administrative workloads and dedicate more towards research and teaching.”

For more information you can contact Lee Kin Thong (Enterprise Solutions and Services) at kin_thong_lee@dell.com.

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A recipe to avoid becoming the next headline By Matthew Johnston, managing director for South Asia, Dell Software According to Gartner, with 25 percent of corporate data traffic expected to flow directly from mobile endpoints to the cloud globally in the next three years, there has been greater interest in identity and access management (IAM) to mitigate risks. The interest in IAM has increased also due to the possibilities introduced by the Internet of Things (IoT), which Gartner estimates will drive 20 percent of new IAM applications by end-2016. In spite of this, every day we hear of a “major” security breach at another big company. Security breaches can’t happen unless someone gets access they shouldn’t have. Access is totally within the organization’s control (or should be), and, while there’s no list to guarantee you’ll never be the victim of a breach, there are some simple best practices to make you a harder target, and minimize the damage if someone does get in. It starts with authentication and authorization. Identity and access management 101 explains that access is the combination of authentication (proving you are who you claim you are) and authorization (limiting what you can do based on who you are). Too often, access is executed haphazardly, taking a path-of-least-resistance approach that secures things appropriately as long as it’s not too difficult. It’s well worth the investment, however, to establish rights correctly, ensuring that every user has access to everything they need to do their job, and nothing else. Treat data security as a single issue, not several separate issues. The knee-jerk reaction to regulations and security is to search for the most likely target and find a way to secure it. The result is a siloed approach that’s neither efficient nor consistently secure. A better approach is to unify the things that control access (policy, identity, authentication, provisioning, role, etc.) and get it right once. If a single role definition includes all the appropriate access rights for a group of employees, the risk of someone going rougue, or someone doing something bad with stolen credentials, goes way down. If they can’t get it, how can they abuse it? Put the right people in control. The vast majority of access controls are set up by people who know how to manage the system, rather

than those with the most at stake. IT usually is at the front line of implementing access controls, because they have the rights, tools, and knowledge necessary to set up access for individuals and groups. But, IT typically lacks the context to know what access individuals should have. That’s the property of lineof-business personnel. Find a way to put the lineof-business in control of access rights and as much of the management process as possible. Don’t forget about your administrators. Finally, the “superuser” credentials associated with every system are the crown jewels of access. Someone logging in with these shared, anonymous, and all-powerful sets of rights, can do anything and everything they want, from planting malware to stealing data. Technologies exist that remove the shared nature and anonymity of administrative credentials, and audit all activities performed with them. This one practice alone could prevent the majority of high-profile breaches permeating the news. Just because you trust your employees doesn’t mean you shouldn’t implement access control on them – all of them. Please visit the Dell booth at the CXO Conference on 9 April (Singapore) and 23 April (Malaysia) to find out more about Dell’s comprehensive Identity and Access Management solutions. Alternatively, you can also visit www.software.dell.com or email us at singapore.info@software.dell.com to learn more about these solutions.

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From the Editor EDITORIAL EDITOR

T.C. Seow

Zafar Hasan Anjum Nurdianah Md Nur, Zafirah Salim CONTRIBUTORS Yves de Montcheuil, Sharon Gaudin, John Gold, Rich Hein, Margi Murphy, Kim S. Nash, Mikael Ricknäs, Bob Violino ART DIRECTOR Benedict Koh ASIA ONLINE EDITOR REPORTERS

Gleam Ahead he world mourned the passing of a great leader, so said many headlines around the globe, when the news of the death of Singapore’s first prime minister Lee Kuan Yew was announced, just when this edition was sent to the print. He deserved that recognition. After all, he was the driving force behind the spectacular success of this small nation state—from a colonial entrepôt to one of Asia’s financial powerhouses today. Strong leadership, willpower and tenacity were his hallmarks.

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On a much smaller scale, the success of an organisation also depends on great leadership and commitment to achieving its plans. While no one could accurately predict the future, with the benefit of hindsight, organisations surely can far better prepare for market uncertainties ahead. What’s needed are business leaders’ determination and commitment, and with support, to see through their plans in order to stay ahead of competition. Disruptive technologies aside, organisations too need to be mindful of cultural changes within. For some time now, we’ve seen the decision-making powers shifting from CIOs and IT leaders into the hands of other senior executives. Strategically, this change spurs many competent ones to be closer to the core of the business and quickly becoming a positive contributor worthy of his or her boardroom presence. Survivor of the fittest? Hardly. It’s no longer a competition to the top but a smoother climb up the corporate ladder that calls for

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tact, sensibility and versatility to conform and to contradict where necessary to realise the best outcome for the business. The findings of our latest “State of the Asian CxO Survey”, though not an exhaustive one, offer some insights into what shapes the thinking of the Asian IT leaders. From budgetary concerns to interpersonal skills, this condensed report will hopefully provide some fodder to start your thought process on how best to strive ahead.

T.C. Seow Editor, CIO Asia tcseow@execnetworks.com

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Shedding Light on Dark Data

April 2005, the National University of Singapore (NUS) contracted KS Solutions Pte Ltd for IT services. When the vendor ran into financial difficulties and could not continue, NUS terminated the contract. KS commenced legal action for wrongful termination, prompting NUS to counterclaim for damages. In the court proceedings, NUS alleged non-compliance by KS for failing to release relevant documents and emails. KS explained that some email records were innocently destroyed under its six-month retention policy but the courts were suspicious. They believed the retention policy should have been suspended and levied severe sanctions against the company, granting judgement in favour of the university. Many organisations routinely destroy electronically stored information with limited governance because of the sheer volume of data they generate. This digital debris is often referred to as ‘dark data’—vast pools of untapped, largely unprotected data idling in corporate IT systems. According to IDC estimates, companies can expect data volumes to keep on growing, averaging a 50 percent increase per year through 2016. So what can a company faced with a mountain of dark data do in this situation? Should they preserve every piece of digital information it shares and creates? Saving everything is fine if you know exactly what the dark data contains and how it would be relevant in the event of litigation or a compliance action. According to an online survey by Forester Inc. and ARMA International (Association of Records Managers and Administrators), only 12 percent of survey respondents are “very confident” their dark data was accurate and completely trustworthy. And if the IT department has no clue how useful the data might be in a given business context and business users who do, don’t really care since they don’t own the systems, just who is accountable for it? What about storage and other associated costs in preserving this information? According to the Compliance, Governance and Oversight Council, 69 percent of this dark data has no business, legal and regulatory value. The Enterprise Strategy Group estimates that companies could save as much as US$25 per gigabyte of data in associated storage costs if it is justifiably removed. Cost savings are not just about removal of storage but selecting the right storage technology to match usage patterns that optimise investment in the storage infrastructure. Whoever is accountable and whatever the legal exposure and storage costs, most companies realise it is too much to expect users to diligently follow retention policies. So there is strong interest in

developing an information governance (IG) plan that will incorporate a records management system with automated tagging, metadata correction and records classification. This will limit compliance and litigation risk, reduce storage costs for companies, and do so at scale. Taking Control: How An Information Governance Plan Can Tame Your Dark Data Your company can get on the path to effective information governance by answering four basic questions: • What is being stored and who is responsible for it? The first step is to manage and discover information rapidly and reliably. This will speed up sharing between departments, find records faster, and protect against information loss. By establishing a clear line of accountability, you can also manage and prevent security breaches and ensure information leaks are plugged and traceable. • What are the economics of unclassified, unsorted dark data? An immediate benefit of an IG plan is reduced storage costs, increased data processing efficiency and secure, protected archiving. Automated tagging and metadata classification will minimise manual sorting while automatic policy enforcement reduces security and privacy breaches to deliver an end-to-end solution. • How secure is the information? An effective IG plan will adopt proactive steps to defend against reputational, regulatory or legal exposure and liability. Automated compliance audits will minimise litigation risks and secure business records from inappropriate access and misuse. Enhanced e-discovery tools will help your organisation respond reliably and quickly while protecting the information. • Do you have the expertise to implement an IG plan? Whether you’re starting from scratch or have existing legacy records management solutions, HP consultants can help your company achieve better business results by leveraging best practices to manage your business information as an asset, and not just as dark data. HP Information Governance Services will align your current state and help you scale to your desired maturity level. For more information, please visit hp.com/go/infogovernance or contact enterprisesolutions@hp.com.

TRENDLINES NEW / HOT / UNEXPECTED

Five steps for transforming your business using data ORGANISATIONS THAT WERE BORN DIGITAL

are built around their IT platform, and all their business processes are IT-driven and data-powered. Every action, every decision, is based on the processing of data sets about users and customers, about usage patterns, external conditions, etc. But not every organisation was born digital. If you run a traditional organisation, with various degrees of sophistication in its IT, how can you still transform this business into a digitalised business? How can you create new business opportunities, based on your digital assets? Here are five steps you should take that digital leaders use. Drive your business intelligence toward real-timeliness Chances are, you are already collecting transactional data in a data warehouse or data mart, and you analyse it somehow. Maybe it’s to decide which sales rep to promote of fire at the end of each quarter. Or it’s to establish a list of customers to send the new catalogue to. The first step toward a digital business is to obtain this insight on a real-time basis. Now, “real time” does not always mean sub-second! In fact, I have argued before that “right time” is a better term: get insight when this insight is relevant to impact the business. Instead of just using your sales reps performance ranking for HR reasons, use them to send your best reps the best leads, and to provide a gamified challenge to these who usually do great but are having a (hopefully temporary) hard time. And use customer segmentation for in-app promotion and text-message-coupons.

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Of course, all of this requires insight to be obtained in right time. Agility and instantaneity constitute one of the foundations of digitalisation. Inject analytics into all business processes Obtaining insight from real-time analytics is only the beginning. Business processes need to be retooled to accept this insight as an input. When business intelligence was all the craze, this used to be referred to as operational business intelligence— the concept has not changed, only the technology. Real-time analytics, rules engines, intelligent business process management tools, push-style communication protocols make it possible to inject and modify rules, to trigger and modify actions based on insight. Always look for more data Storage is cheap, and the newest breed of data platforms makes it really easy to amass data even if the purpose is not clear. You may not be ready to move your transactional systems, or your data-warehousing infrastructure, away from the tried and proven mainframes or RDBMS they are running on. That’s fine. But consider complementing them with a data lake based on Hadoop, and to dump into this lake data you would not have considered worth keeping in the past: access logs, GPS records, abandoned carts, call data records, customer complaint messages, and so on. All of this so-called “dark data” can be used for new insight, for new actions. You may not know which ones yet—but you won’t know until you have had a chance to look.

Explore new ways to use your data With reason, give unrestricted access to all data to your analysts. I say “with reason”, because some industries have specific regulations that apply, and all industries need to be careful about data privacy. But, assuming you can trust them, and the proper governance exists that would curb any abuse, let your experts explore the data. They will find ideas—some that will work and some that won’t. It’s always difficult to measure the return on investment of innovation. But innovation happens when people are let to pursue ideas. Google got it right, with their “20 percent time” program. You may not have official data scientists. But a good business analyst, equipped with modern tools for data preparation/exploration, can achieve amazing results. Release often, test all the time and fail fast This last point is probably the most critical one. Digital organisations are agile. They always test innovations in real-life conditions. Once a feature is complete, go live with it and measure its effectiveness. If it does not yield the expected results, be ready to pull back—revert to the previous version, remove the option, try something else. And whenever possible, test different alternatives in parallel to see which one works best. The key is not to always get it right— nobody does. The key to success is to fail fast, and change course before it’s too late. — Yves de Montcheuil

nearly half (46.9 percent) of the cities in Asia would have adopted cloud computing to a moderate or extensive degree as part of their plans to become smart cities. This was one of the findings from a joint study by Microsoft Asia Pacific and CityNet, titled “City Cloud: Cloud Adoption for Asia’s Cities”, that polled 38 senior city officials from 37 cities of various sizes across the region. Population growth is said to be a major driver of cloud adoption by Asian city governments, said Stefan Sjöström, Vice President for Public Sector of Asia at Microsoft, in an exclusive interview. “Populations in Asia’s cities are growing at an unprecedented pace—more than 100,000 people per day. To improve the operating efficiency of city infrastructure and the living environment of citizens, we foresee that cities in Asia will increasing look to the cloud for the benefits that it will bring.” Sjöström added that cloud could help governments improve citizen engagement, ICT ecosystem development, and city administration; lower operating costs; and enhance revenue streams. “Take citizen engagement for example - with the cloud cities can expand their reach and improve citizen participation in municipal affairs. Using the cloud, online resources can provide citizens with virtually anytime, anywhere access to information and services,” he said.

BY 2018,

Lagging cloud adoption Despite the expected growth in cloud adoption, the figure pales in comparison to adoption rates amongst medium to large enterprises in the region. According to Microsoft, 71 percent of the 291 IT decision makers across 10 markets in Asia Pacific polled claimed to have prioritised investments in the cloud. Strip ad(b)V3.pdf

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Nearly half of Asian governments will utilise cloud by 2018: Microsoft The study revealed that that the main reasons for the slow cloud adoption rate in Asian cities include upfront costs, lack of a strong value proposition, riskiness of the cloud, and internal resistance. “These findings point to the high levels of misinformation about the cloud being perpetuated amongst Asia’s city leaders,” commented Sjöström. Clarifying the misconceptions, Sjöström explained that cloud can be much cheaper to implement than on-premise solution as it utilises a pay-as-you-go model and does away with physical infrastructure costs. Also, cloud can at times be more reliable than using a local data centre. “Some cloud providers are even willing to back the reliability of their cloud services with financially backed service level agreements,” he said. Silver lining for cloud   It was encouraging that over 80 percent

of the respondents acknowledged the potential benefits of cloud. Senior city officials agreed that cloud could help lower labour costs, improve disaster recovery, enhance interaction amongst city departments, as well as increase the speed of adoption of new technologies and deployment of e-government applications. To further encourage Asian cities to extensively use cloud, Sjöström urged cloud service providers to “take an active role in debunking cloud myths and educating on the benefits of cloud adoption.” He added that once city officials have the right knowledge about the cloud, it will be easier for them to communicate their vision, plans and commitment on using the cloud to advance sustainable urban development. “This clear direction will help garner better understanding and buy in from all stakeholders to smoothen the cloud adoption journey.” —Nurdianah Md Nur

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PEOPLE TODAY expect their software to work wherever they are, whether they are using a mobile device or a desktop PC. As a result, IT must respond to these demands quickly. DevOps aims to do just that by allowing organisations to produce and release more high-quality code better and faster. What is DevOps? Is DevOps a culture or a skillset? The answer is it seems is both, some even refer to it as a philosophy. Using both lean and agile methodologies organisations bring IT operations, development teams as well as quality assurance people together throughout the software lifecycle to create a more collaborative process that, in the end, should deliver software and/or services in a faster and more continuous manner. Traditionally, elements of IT have been siloed. DevOps aims to break down those silos to get everyone working towards the same goal. “What really sets DevOps apart in terms of movement and philosophy can be expressed by the ‘infrastructure as code’ philosophy. Traditionally, operations has been an ad hoc type of endeavour — with the capability to track changes and monitor the state of systems being something driven by external processes. DevOps, in general, aims to make those change and state processes more transparent by allowing the traditional concerns of infrastructure, state and security to be shared resources (“code”) rather than isolated silos of knowledge. Essentially the idea of DevOps integrates the configuration and deployment of applications as part of the development as opposed to a separate operational step,” said Shravan Goli, president of Dice.

DevOps value A recent report from Puppet Labs highlights the reasons that DevOps is a journey worth making. The study Strip ad(c)V3.pdf

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How DevOps can redefine your IT strategy surveyed more than 9,200 respondents from 110 countries, making it one of the larger studies on DevOps and its effect on the way organisations do business. Here are some of the highlights: • Traditional Ops are 41 percent more time-consuming overall. • Traditional Ops spends 21 percent more time putting out fires. • DevOps spends 33 percent more time on infrastructure improvements. • The data suggests that organisations using DevOps practices see organisational performance benefits, and that firms actually investing in DevOps see significant gains compared to those who do not. • The longer an organisation uses DevOps methods the higher their IT departments perform. • High performing IT organisations have 50 percent lower change fail rates than medium and low performing IT organisations. Finding people with this almost magical skillset is difficult. Unfortunately, there isn’t yet a clear career path for talent to follow. “Many DevOps people come up through the infrastructure technology path because of the heavy reliance on scripting and configuration management in DevOps. But then QA analysts well-versed in automation may end up running DevOps as well,”

said Angela Yochem, Global CIO at BDP International. So where should you be looking for talent in the DevOps arena? “It [DevOps talent] typically doesn’t come from IT; my experience is that engineers, working in IT, are a better fit. If they have manufacturing experience where LEAN has been instantiated for some time, it’s even better,” said Michael Henry, senior vice president and CIO at Rovi. This market is a competitive one in regard to talent acquisition. “It’s been easier to grow my talent internally for two reasons: Competition is fierce, and everyone wants to wear the DevOps tag on their resume,” Henry said. Another interesting fact from in the Puppet Labs survey is that 16 percent of those surveyed reported working within a DevOps department. This is a new trend, having only come into existence within the past five years. Of those who reported working within a DevOps department, a majority work in companies with 20 to 499 employees. These individuals, according to the Puppet Labs study, tended to work in the entertainment, technology and Web software industries. But before you create your own DevOps department, beware that there are critics of this practice and their argument isn’t without merit. In a

TRENDLINES recent blog post, Jez Humble wrote, “The DevOps movement addresses the dysfunction that results from organisations composed of functional silos. Thus, creating another functional silo that sits between dev and ops is clearly a poor (and ironic) way to try and solve these problems. Instead, DevOps proposes strategies to create better collaboration between functional silos, or doing away with the functional silos altogether and creating cross-functional teams (or some combination of these approaches).” Making a career in DevOps If you hope to take advantage of the DevOps trend there is good news. According to a recent study from Edureka, there has been a 75 percent increase in job listings that contain DevOps. However, there are things to consider: Our experts agree that strong collaboration and adaptability are essential but more in needed. “DevOps roles require more interpersonal and communication skills than either a traditional heads-down developer or operations person. [Because] you are in essence bridging the gap between the two areas, collaboration skills are key and the creativity to solve real-world problems is critical. Additionally, one needs to have a strong focus on process and continuous improvement,” said Tracy Cashman, senior vice president and partner with WinterWyman. “A successful DevOps candidate will likely have experience in both software development and operations, experience with soft skills and a collaborative approach to work, and a drive to learn and evolve as the needs of business and technology change,” said Goli. Experts are split on certifications. “DevOps, to me, is more about on-the-job training vs. certifications. Companies want to know that you have ‘been there, done that’,” said Cashman.

A SIDE-EFFECT OF DRIVERLESS CARS

will be the prevalence of robots, research firm McKinsey has found. Self-driving cars will rely on artificial intelligence, image recognition, GPS and processors to manoeuvre safely—similarly to robots. Interest shown by car manufacturers and tech firms like Google and Apple is accelerating the development of autonomous car technology and this in turn will lower the production costs for robots, which could use similar hardware benefitted by lower production costs, McKinsey said. Self-driving cars could also help people grow accustomed to other machines, like robots, that can complete tasks without the need for human intervention. Commonly used parts could allow auto mechanics to fix robots as well, said the recent report. Infrastructure like machine-to-machine communication networks could also be shared. The report was published while MPs in the UK are debating over whether to appoint a minister to oversee the incoming driverless and electric car trends. Louise Ellman, the Labour chair of the transport select committee said the UK may miss out on the opportunities presented by new car technologies if the government did not do more to encourage the car maufacturing industry, as well as consumers. Several car companies are working either independently or in a consortium to begin piloting driverless cars, and have said that the technology could be seen on public roads as soon as 2017. However McKinsey stated that trucks will become the first vehicles that drive autonomously on public roads, over the next two decades, requiring changes in the insurance industry. But autonomous passenger cars won’t appear in critical mass on public roads until after 2040, the report forecast. Fewer parking spaces will be necessary, as driverless cars will be wired for precise three point turns. It estimated the technology could free up 5.7 billion square metres of parking space in the U.S. by 2050. —Margi Murphy

Driverless cars will spur development of robots: McKinsey

Yochem agrees for the most part. “Most of the certifications are still platform/discipline-specific, and many of these are part of the DevOps world. But, overall, no certifications are necessary here.” There are some certifications out there worth looking into, according to Goli and Henry, although they aren’t the silver bullet you may be looking for. Lean certifications or certifications offered that can express a background in certain technical tools, such as

configuration management tools or cloud certifications. DevOps isn’t something you can just decide to do. Much like big data, it requires a culture change and a breaking down of the functioning silos within the IT organisation. It needs to start at the top. The endgame is to have your development and operations team working in a collaborative fashion toward the collective goal of continuous delivery of better software. —Rich Hein

www.cio-asia.com APRIL–MAY 2015 09

TRENDLINES

SAMSUNG

The Gear VR virtual reality headset works along with the Note 4 smartphone.

Google, Facebook racing for virtual reality launch the game is on. And Google and Facebook are competing hard to beat each other to the punch with their own virtual reality offering. “The company that gets here first, providing a rich development environment, will be able to set the standards that others will have to use,” said Dan Olds, an analyst with The Gabriel Consulting Group. “Both Google and Facebook are keenly interested in being the one that establishes the first viable platform. Assuming it’s a highly functional, and at least somewhat open, platform, the owner of that first platform controls how it develops over time. It’ll be a great position to be in.” Just last February, Facebook Chief Product Officer Chris Cox publicly said that the social network is working to develop virtual reality software. Without laying out any specifics, he said the company is focused on making apps that will enable users to create their own virtual reality content. Cox’ statement, made at the Code/Media 2015 conference in Laguna Niguel, Calif., stirred up a lot of online excitement. In another interview at the time, Olds said if Facebook can make this virtual reality software work, it could

WHEN IT COMES TO VIRTUAL REALITY,

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revolutionise the way people work and play online. Then things heated up when a Wall Street Journal report hit late last week noting unnamed sources who said Google is building an Androidbased operating system for virtual reality programs. According to the report, “tens of engineers” are working on the software that would be made freely available. Google has not yet responded to a request for confirmation. If the report is accurate, though, that would mean that Google and Facebook—once again—are pitted in a race. The two Internet giants are accustomed to battling it out. Going after as many users as they can accumulate, the two companies compete for online eyeballs and advertising, as well as in the social networking space with Facebook easily dominating Google+. Now, they’re in a sprint to be the first to hit the virtual reality market. “Getting in early means a technology can establish a beachhead, get their products in the hands of customers, and then build upon that early presence in the market,” said Brian Blau, an analyst with Gartner. “The largest consumer platforms and technology companies stand the most

to loose if they don’t come out early.” And it’s going to be an important market, with some analysts seeing virtual reality shaping the way we’ll entertain ourselves, as well as the way we conduct business in the near future. “It is the future of entertainment,” said Rob Enderle, an analyst with the Enderle Group. “Virtual reality puts you physically in the action. Whether we are talking movies, concerts, or games, it provides an opportunity for engagement that simply can’t be matched with traditional media.” For the enterprise, virtual reality might mean some business travel is replaced by tele-meetings where people feel like they are sitting beside their co-workers or clients, instead of sitting in their actual offices. Sales people could use virtual reality to walk potential clients through simulated experiences, while realtors could walk buyers through virtual homes or office buildings. “It could revolutionize remote education and telemedicine, for instance,” said Enderle. “Virtual reality would be a powerful ad revenue generating engine, placing ads in places where you couldn’t avoid them. And when it comes to social, you could allow people to remotely engage intimately in a virtual world of their choosing. The next Facebook could be a virtual reality firm.” Olds noted that he doesn’t expect to see many other major players go after the virtual reality market right off, but it will be critical for Google and Facebook to make this work for them. “What if virtual reality takes off and neither one of them are players?,” he asked. “This would mean users are plugged into their computers for long periods of time, but not using Facebook or Google, which would be a very bad thing for both companies. “If virtual reality is going to be big, then both Google and Facebook believe they need to be at the vanguard of it,” added Olds. —Sharon Gaudin

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TRENDLINES

SCS crowns IT Leader Awards 2015 winners THE SINGAPORE COMPUTER SOCIETY (SCS)

crowned the winners of the IT Leader Awards 2014 at its annual Gala Dinner last Friday (6 March 2015). Four distinguished individuals were recognised for their achievements and contributions to Singapore’s information, communication and technology industry. “We congratulate this year’s winners on their individual achievements and celebrate their contributions to the industry’s progress as a whole,” said Ong Whee Teck, SCS’ chairman of the IT Leader Awards 2015. “We are confident that their accomplishments will serve as an inspiration for the younger generations to pursue careers in IT and set new benchmarks.” Hall of Fame  Professor Christopher Chia, currently a professor of transformation practice at NUS Business School, was presented with the Hall of Fame award for his continuous efforts of bridging IT and the business world. When he was in the National Computer Board (NCB) in the 1980s, he pioneered the concept of quality assurance and app development standards in the Civil Service Computerisation programme. In 1995, Professor Chia became the founding CEO of the National Library Board (NLB). There, he leveraged IT to set up digitally-networked library, offering users information in multiple formats including electronic databases and various multimedia services. This resulted in NLB garnering over 2 million members, over 30 million visitors, and 32 million loans by 2003. Professor Chia also played a pivotal role as the CEO of Singapore’s Media Development Authority from 2004 to 2010. Under his watch, he successfully increased the value-add of the sector from about S$4.27 billion in 2003 to

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over S$7 billion in 2010. IT leader of the year  Award recipients at SCS’ gala dinner. From left to right: Chak Kong Soon (SCS President); Quek Yang Sheng (IT Youth); Tan Tong Hai, Darius Cheung (Entrepreneur of the Year), Professor Christopher Chia CEO and executive (Hall of Fame); Tan Tong Hai (IT Leader of the Year); and director of StarHub, Dr Yaacob Ibrahim, Minister for Communications and Information. was named the IT leader of the year for his exemplary mobile messaging app for classroom leadership, and leading innovations environment. The app is now used to and breakthroughs in development facilitate classroom collaboration and or application of infocomm and learning purposes, and was featured at media. At StarHub, Tan oversaw TP’s annual IT Project Show 2014. initiatives including the Golden With the belief that technology Gurus programme, which empowers should be used to positively impact tech savvy citizen to help their peers the society, Quek led his peers in by imparting their IT knowledge; community work through the use of IT. and MySmartEye, a mobile app that He started a workshop that garnered helps the visually impaired to see him and his team the Outstanding their surroundings with the aid of Achievement Award by Metropolitan a volunteer network. Besides that, YMCA Singapore in 2013. Called he has led StarHub to strategic “Build Your Own Android App”, the partnerships with cloud solution workshop teaches young beneficiaries providers to deliver cost-effective of the Chinese Development Assistance solutions to serve small and mediumCouncil the basic skills of building sized enterprises. mobile apps without any coding. Before joining StarHub, Tan headed the implementation of Entrepreneur of the Year the Central Identification and Darius Cheung, founder of property Registration Information System portal 99.co, took home the (CIRIS) for Singapore’s Immigration Entrepreneur of the Year title for and Checkpoints Authority (ICA), his continual role in the which won the 2008 Infocomm entrepreneurial ecosystem. Built to Singapore Awards. be easy to use, 99.co provides users trustworthy and relevant search IT Youth results, as well as intelligently collates Quek Yang Sheng, who is currently data to help consumers make the pursuing a Bachelor of Computing best property decisions. in Computer Science at NUS, bagged Before 99.co, Cheung founded SCS’ IT Youth award. He was the mobile security company tenCube, gold medallist for graduating top of which was later acquired by McAfee. his cohort with a Diploma in Mobile At tenCube, he grew the startup to and Network Services from Temasek a team of 26 people in two locations Polytechnic (TP). During his student over five years, raised two rounds of internship, Quek worked on an financing, created an award-winning initiative by the Ministry of Education’s mobile security product WaveSecure FutureSchool and Rockmoon and led the startup to profitability. —Nurdianah Md Nur Pte Ltd to create an educational

TRENDLINES A BROAD RANGE of companies at Mobile World Congress in March this year have teamed up to improve smartphone security and offer better software integration for Internet-of-things deployments. Here are some of the trends and announcements from this year that will have an impact on enterprise mobility: IoT can be more tightly integrated with business processes To make data from connected sensors more useful, IoT platform vendors are joining forces with software companies to open the door for better integration. Jasper teamed with Salesforce as well as SAP. The goal in both cases is to make it easier to deploy and manage IoT services. Android is becoming more enterprise-friendly Google’s announcement of Android for Work the week before Mobile World Congress was hardly a coincidence. The timing let the company’s partners, including AirWatch, demonstrate their compatible management tools and products in Barcelona. Android for Work—which separates business apps from personal apps—is a big step in Google’s effort to dispel notions that its OS isn’t safe enough for enterprise users. Time to start thinking about wearables In a sign of things to come, enterprise mobility management vendor Good Technology announced that it now supports Android Wear. As wearables become more popular, IT managers will have to start looking at what opportunities and challenges they present. More super-secure devices are on the way Swiss company Silent Circle announced a new smartphone and tablet along with enterprise messaging software. The BlackPhone 2 smartphone will go on sale in June with a similar price to its predecessor, the BlackPhone, which costs US$629. The specification includes a 5.5-inch screen and an octa-core processor. The Blackphone+ tablet will arrive during the second half of the year. Beyond a 7-inch screen, not much has yet been reveled about its specification. The Swiss company also said it’s working on an encrypted, peer-to-peer email system. The more established vendors are also taking steps to lock down their smartphones. Samsung has extended the company’s partnership with BlackBerry to include technology from its subsidiary Secusmart. The resulting SecuSuite for Samsung Knox—for encrypting voice, text and data traffic—will be available later this year. Affordable smartphones aren’t just for consumers Mid-range smartphones have become much more capable in just the last year, with octa-core processors, 5-inch screens and LTE becoming standard features. So, any responsible CIO needs to seriously consider Android-based smartphones that cost around US$300 unlocked, instead of devices that are twice as expensive or more. Microsoft also wants a piece of the action, as it hopes to increase Windows Phone and later Windows 10 market share. It launched the Lumia 640 and the Lumia 640XL phones at the conference. The company is also working with AT&T in the U.S. on the Mobile Office Suite to bundle smartphones, Office 365 and wireless plans for small and medium-size enterprises. —Mikael Ricknäs

Five takeaways for CIOs from this year’s MWC

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Survey: Users hate lack of privacy controls on Internet INTERNET USERS WANT PRIVACY,

but it’s increasingly difficult to find, according to the results of a study released today by open-source software company Open-Xchange. Of the 3,000 Internet users in the U.S., U.K. and Germany surveyed, 55 percent said that it’s “impossible” to keep their personal information private while enjoying the Internet, and 59 percent said that it was too hard to keep private information off the Internet. When asked what they would do when faced with a hypothetical service they knew was storing and monitoring their personal data, fully half said that they would immediately stop using the service, while 36 percent said they would want to review the data and make changes. Open-Xchange, of course, is at least partially concerned with selling its OX Guard encryption product—witness the additional questions on the survey about the willingness of users to use simple encryption to increase privacy. In spite of the majority’s view that keeping personal information off the Internet is “impossible,” a total of 69 percent of U.S. users surveyed rated themselves either “slightly good” or “extremely good” at protecting their personal data online, with a further 27 percent rating themselves “neither good nor bad.” Just 4 percent saw themselves as either “slightly” or “extremely” bad. Open-Xchange CEO Rafael Laguna was born in East Germany, and said in a statement that that experience made him particularly concerned about privacy issues. —John Gold

Visit www.opentext.com for more information or contact Opentext Singapore office at +65 6594 2386 or email: echan@opentext.com.

EVENT

echnology is enabling all levels of the enterprise to work more effectively and efficiently, while providing greater visibility on internal and external challenges and opportunities. From a CEO viewing company performance on a dashboard, to a CMO using customer data to more effectively plan engagement and retention; traditional IT has evolved to a point where it is in the position to play an active role in an organisation’s transformative change. So, how are forward-thinking CXOs using technology to identify their objectives and deliver valuable results? One way to find out is to be at this year’s CIO-CXO Conference in Singapore, which is jointly organised by Executive Networks Media (the publishers of CIO Asia Magazine) and IDC Asia/Pacific, to explore the benefits and pitfalls of technology at the LOB level. From the feedback from past delegates who said that the traditional conference format—with the one-way flow of information from speaker to audience— did not really promote engagement, this year’s conference will build on the already successful interactive Executive Networking Tables (ENTs) to further provide direct contact and face-toface interaction between participants, practitioners and industry experts. Most participants would have hoped for oneon-one time with the speakers, and they wanted to be able to relate to the content and they wanted to network and discuss real issues. The Executive Networking Tables (ENTs) allow delegates to have in depth discussions with the experts leading the discussions and their peers taking part in the conference. The ENTs involve small group discussions around a specific set of topics, hosted by an industry leader who will provide the business perspective, and a technology expert who will provide a perspective with references from the industry. The CIO ENTs will consist of three key themes, namely, Business, Technology, and Leadership. The Business track will focus on Revenue-generating IT

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CIO-CXO Conference: The Show for the C-suite Building on the success of the annual CIO conference held around the region in the past, this year’s programme promises to be refreshingly similar yet different to help bring CIOs to the next level.

Strategies and Business Growth; the Technology track on Mobility, Social, Consumer Devices, Big Data, and Cloud Computing—The Business Impact of IT Trends; and the Leadership track will focus on IT Leadership and Innovation, and Strategy and Execution. Running in parallel with the CIO Conference in Singapore is the inaugural CXO Conference, which is a natural progression to the already established CIO Conferences in the region. More importantly, it addresses the need for other C-suite executives to stay ahead of the technology game, which has become so much of any business’s success formula. “The CXO Conference series will run in our innovative and interactive ENT format,” said Mark Hobson, CEO of Executive Networks Media. “Delegates will go through a series of small, high level, group discussions where you spend 30 minutes on a set topic. The topic is defined, but what you focus on

under that topic is dictated by you, the delegate. Ask the burning questions, feel free to disagree and change the direction of the conversation.” The CXO ENTs will look at the following issues: Risk Mitigation (CFO Journey), Digital Innovation (CMO Journey), and Disruption (CEO/COO Journey).

CIO Awards 2015

Placed in its own separate hall, the CIO Conference will also have a segment on CIO Asia magazine’s annual CIO Awards. This year, the Awards programme will return for its 14th presentation, highlighting the top five winners from the region. Discussing issues specific to the CIO role, the CIO Conference will run alongside the CXO Conference with a shared exhibition and networking area. For more information, visit http:// www.cio-asia.com/microsites/cio/ cio100_2015/events.html

Three steps to remedy tension headaches for hybrid enterprises By Simon Naylor, Vice President, ASEAN, Riverbed Technology

The promise of cost savings and delivering a better user experience is driving the hybrid enterprise effort across Asia Pacific & Japan. For modern hybrid environments – those comprised of a combination of private assets and public services - the promise of savings mount from a less expensive physical footprint as well as more flexibility to get data and apps where they need to be. However, with an increasing range of complexity, rapid change, and lowcost initiatives, today’s networks and applications can quickly turn into a tension headache for CIOs and IT staff. Factors that contribute to this headache include keeping track of a changing mix of cloud-hosted, on-premise, and shadow IT apps, all of which combine to provide the backdrop for the modern hybrid enterprise. Here are three ways to provide the right remedy for any complications that can come along and result in a hybrid enterprise tension headache.

1. Visibility For visibility across the hybrid enterprise, it’s critical to get the right metrics to the right individuals who can address the issue at those day-end situation rooms where you’re all debating over whether it’s the network or the app and now “the cloud.” You’ll want to get cloud visibility, branch visibility, and end-to-end visibility. As many are now saying, “You cannot manage what you don’t measure—or see.” The right data helps you validate and measure everything that is important to your app delivery process and be proactive to issues that might affect your business bottom line. In a hybrid enterprise, by deploying a combination of agents and passive and active collection tools across the enterprise, you get: Real-time actionable data that can be stored and shared for all IT staff End-user experience monitoring of apps from end-to-end

Response times of page views for your critical applications

links where your critical data traverses for mission-critical applications.

Infrastructure health of servers and application tiers

With this in mind, you can identify some applications that you want to have priority over others for specific locations or sets of users. Having the tools to control who or what gets priority can really give you the flexibility to provide optimum service at a reduced cost.

In some cases, you might need to do a deep dive with a packet capture at one of the branch offices in your network, or consult an instrumented server in your data center. Apps hosted in the cloud can be measured for their page views and the response times of the page views to hold your service providers accountable to their SLAs.

2. Optimization When you have data that needs to get to users from anywhere on any device, you’ll want to deliver LAN-like performance for applications and data transfers regardless of WAN latency, capacity, and quality constraints. Using a WAN optimization strategy across your hybrid enterprise, you can accelerate applications by up to 100x. Here are some of the key benefits of WAN optimization: Data deduplication to optimizes WAN bandwidth utilization Reduce WAN requirements by up to 65-95% or more Eliminate transport protocol inefficiencies related to WAN latency and congestion Increase TCP throughput by up to 60x or more

With the right application performance platform in place, you can use all of your solutions in concert with each other. For example, Riverbed SteelHead appliances can also serve as data feeds for your visibility tools for a complete, integrated solution where visibility from strategic locations across the hybrid enterprise becomes quite easy to achieve because you already have a valuable footprint in the location of interest.

3. Control Once you have the right visibility and tools to improve end user experience, you’ll want to control and tune your environment when certain conditions or users need priority. For example, you might have a combination of MPLS lines and Internet

Some of the main areas of control include: QoS for outbound and inbound groups of traffic Bandwidth and latency prioritization and HFSC scheduling Application-centric, and business intent-based policies for path selection Secure multi-path encryption and any-to-any group VPN control

Much of the control is enabled by automatically identifying and organizing over a 1,000 applications running across your hybrid enterprise. Whether it’s video, voice, mission-critical, file transfer, or recreational traffic, you have the control to determine to policy configuration, reporting, and troubleshooting. Bringing it all together in a dashboard Bringing all of the above together in easyto-view dashboards makes this approach to the hybrid enterprise less of a headache and allows you to get back to the business of making sure that all of your end users are happy and productive. The hybrid model is now undeniably the new normal and the approach of choice for many businesses in Asia Pacific & Japan, with most of us familiar with “as a service” acronyms SaaS, PaaS, and laaS. By following the three steps outlined above, we’re confident that businesses can effectively manage the complexity that comes with a mix of private assets and public services, reduce tension headaches, and succeed as a hybrid enterprise.

COVER STORY

CIO:

From Tech to Relations

Our 2015 State of the Asian CxO survey brings some interesting answers on the CIO’s role, and the hot areas they need to focus on. BY T.C. SEOW

How has the role of the CIO changed over the last decade?

What new challenges will the CIO face in the near future? Where are the major pain-points in the overall responsibility of the CIO? We set out to seek answers to these questions in our annual “State of the Asian CxO” survey, except for 2014 when the survey was put aside to reconsider some of the information sought for, chiefly because the CIO’s role has indeed changed significantly over the last decade. A decade ago, the discussion around the CIO role continued to centre on the technological know-how of the CIO himself, being the person who sat on top of all things IT-related. In the last five years, that role morphed from being a tactical one to a strategic role that complemented senior management’s focus on shaping the organisation’s path ahead, with a view to boosting its overall productivity. That role is now poised for another major shift. According to a recent research by Gartner, CIOs will increasingly adapt processes that are dynamically able to capture the changing customer needs. And by 2017, 70 percent of successful digital business models will rely on deliberately unstable processes designed to shift towards meeting changing customer needs. The key phrase is “digital business model”. That encompasses the need to rely on information technology to better deliver services, achieve organisational agility, and delight customers in order to ensure longterm survival of the business. The Chief Information Officer now has a renewed calling to help attain that digital business model.

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Creating a Wonderful World

COVER STORY Here are some of the highlights from the survey conducted during the first quarter of 2015.

Management Issues

Table 01 shows what are the top five management issues CIOs face this year. For comparison, the table also lists the top fives for 2013 and 2012. Unsurprisingly, aligning IT and business goals is still the number one priority, followed by business continuity/risk management—virtually unchanged from those of 2013. Enterprise IT security has reared its ugly head this year, no thanks to the numerous accounts of major security breaches suffered by huge organisations around the world. In particular, preventing identity theft and information leaks have become an urgent undertaking for many organisations, which now realise that digital assets are worth every dollar spent to prevent theft and leaks from happening. The damage to property and name could be devastating, in addition to loss in business and customers. Going hand in hand is the need for data protection and privacy. To some extent, the authorities are forcing their hands to comply, which, in the longer term, could only benefit both the business and customer alike. Nevertheless, cost control is still among the big five, but there is now less emphasis on controlling costs. Two years ago, disruptive technologies such as BYOD and consumerisation of IT had caused tremendous headache to the CIO who was struggling to adapt to the changing ways how IT was deployed. That has now subsided, probably because the CIO’s ability to assuage such disruption has been well learned to suit the needs of both senior management as well as users alike. TABLE 01: Top 5 management issues 2012

2013

2015

Aligning IT & business goals

Aligning IT and business goals

Controlling costs

Business continuity/risk management Business continuity/risk management

Business continuity/risk management Controlling costs

Enterprise IT security

Improving internal customer (user) satisfaction

Enterprise architecture

Controlling costs

Process improvement

Data Privacy & Protection

Table 02 shows a clearer picture where the CIOs see themselves in their roles today. Survey respondents were asked to indicate their level of agreement with the statements listed. Here are the top five corresponding to their strongly agreeing to what were shown. TABLE 02: Top 5 strongly agreed statements 1.

The CIO role is becoming increasingly more challenging.

The CIO is becoming more important to your business.

It is challenging to find the right balance between business innovation and operational excellence.

The CIO role is becoming more rewarding.

The future CIO role will likely be focused primarily on managing contractors, cloud and other IT service providers.

Again, it’s unsurprising that CIOs see their role becoming more challenging. Disruptive technologies, like the four “pillars” of cloud, social business, Big Data/analytics, and mobility—as illustrated in research firm IDC’s third platform of technology evolution—has brought various issues to the table. CIOs are forced to look at ways to achieve organisational agility, and at the same time, quickly implement new solutions that could help bring competitive advantage in the near future. Looking ahead, Table 03 provides some interesting areas CIOs are moving into. These aren’t new issues but they have taken on new priorities as their business struggles to keep up with the competition externally, and to gain visibility and agility internally in order to make decisions faster and better than before.

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COVER STORY TABLE 03: Top 5 focuses for next 3 to 5 years 1.

Developing new go-to-market strategies and technologies

Identifying opportunities for competitive differentiation

Leading change efforts

Driving business innovation

Developing and refining business strategy

On budgets, the survey asked for a fresh perspective this time round. Instead of asking if IT budgets would be increased over the next 12 months, the survey asked respondents to choose the percentage of the total dollars their organisation invests in technology products and services is directly controlled by IT, and what percentage directly controlled by IT in the next three years. Sixty-six percent felt uncertain about their IT investments would be controlled by the IT departments in the next three years, versus only 34 percent weren’t not sure of their current IT budgets. A sign of contradiction: Almost 76 percent said they control 91 percent to 100 percent of IT investments currently, but that level of confidence dropped to 24 percent over the next three years. This could only mean that IT investments are moving out from the IT department and into possibly line of business’s decisionmaking process. Encouragingly, CIOs are taking proactive actions to help raise their status within their organisation. In Table 04, the respondents clearly felt that being able to see eye to eye with their peers would be important, and getting more line of business executives to understand their operations will be key to help foster better relationships with them. Forgetting too is the importance to be seen as reliable partners, while making things easier to understand and use. TABLE 04: Top five actions that will be most important in the coming year to elevate IT’s general relationship with business stakeholders 1.

Engage business stakeholders more effectively

Train IT staff to partner better with business stakeholders

Create quick wins for business partners

Simplify and standardise technology

Reorganise so that the IT group is easier to work with

Are you the top IT executive in your company or business unit?

Yes

Yes 76.9%

76.9% 22

23.1%

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What’s your job title? IT Director 33.3% Other 21% CIO 16.2% VP 13.3% General Manager 7.6% CIO & SVP 2.9% CIO & VP 1.9% SVP 1.9% CIO & EVP 1% CTO 1%

COVER STORY Respondents were also asked about their top three solutions that need to be implemented urgently. Table 05 shows the answers. Big Data and analytics are perhaps a topic that requires deep knowledge, but CIOs can comprehend the potential such solutions would bring to the table. TABLE 05: Top three technologies/solutions under pressure to implement 1.

Big Data solutions like business intelligence and analytics

Data privacy and risk management implementation

More efficient hosting solutions

Business Issues

One of the questions in the survey asked respondents to select from a list of initiatives that are likely to be their organisation’s top business priorities over the next 12 months. Regulatory compliance is of utmost importance, followed by human resource problems like hiring, developing and retaining the best people. In the longer term, addressing the rising expectations of customers and improving customer satisfaction has also taken on urgent tone as organisations work towards growing their business. TABLE 06: Top 5 business priorities in 2015 (in descending order) CRITICAL PRIORITY

HIGH PRIORITY

Comply with government regulations and requirements

Improve the capabilities of your products / services

Hire, develop, and retain the best employees

Improve the firm’s ability to innovate

Acquire and retain customers

Improve the quality of our products / services

Grow overall company revenue

Lower the firm’s overall operating costs

Address the rising expectations of customers and improve customer satisfaction

From the angle of technology deployment, businesses are paying attention to those issues listed in Table 07. Again, respondents were asked for their different priorities for contrast. What’s urgent now is the need to improve IT project delivery performance, perhaps more so when today’s top executives have become so used to experiencing using devices such as smartphones and tablets that work well without requiring intensive training, and easy access to information whenever and wherever they want.

What is the worldwide annual revenue of your organisation? To whom do you report? 9%

42.3%

26%

11.5% 11.5%

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CEO COO CFO Corporate CIO Other

> US$50 million 35.4% US$100m to 499m 17.7% US$50m to 99m 16.7% US$1b to 4.9b 10.4% US$500m to 999m 10.4% > US$10b 5.2% US$5b to 9.9b 4.2%

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COVER STORY TABLE 07: Which of the following technology will be a priority for your organisation over the next 12 months? (In descending order) CRITICAL PRIORITY

HIGH PRIORITY

Improve IT project delivery performance

Improve IT budget performance

Identify new ways IT can better support business / marketing objectives

Reorganise or retrain IT to better align with business outcomes and drive innovation

Improve the use of data and analytics to improve business decisions and outcomes

Improve IT project delivery performance

Reorganise or retrain IT to better align with Develop new skills to better support emerging business outcomes and drive innovation technologies and business innovation

Develop new skills to better support emerging Improve the use of data and analytics to technologies and business innovation improve business decisions and outcomes

From the top executive’s point of view, enterprise security (Table 08) is number one issue to be handled urgently. This ties in well with the CIO’s priorities listed earlier. TABLE 08: What are the CEO’s top three priorities for you in the coming year? 1.

Upgrade IT and data security to avoid cyber attack

Complete major enterprise project

Simplify IT

Conclusion

Has the role of the CIO changed so much that it has become irrelevant? From the survey results obtained, change is certainly the only constant but the CIO is evolving—not just to become relevant but a strategist as well. From another point of view, as organisations push ahead to become more entrenched in digital technologies, who else could be better positioned than the CIO to be the “digital adviser”? The CIO will continue to survive and even thrive in the new age characterised by all things interconnected digitally, and to make sense of it all requires the CIO who has the propensity to see the trends emerging and lay down strategies that work for the organisation. His career is far from over.

What is your organisation’s primary business? Countries

Manufacturing

23.8% Finance & Insurance

16.2% Other

13.3%

Transport & Logistics

10.5%

Construction

8.6%

Wholesale & Retail Trade

7.6%

Government

Singapore 29.3%

4.8%

Malaysia 23.2%

2.9%

Accommodation & Food Services

Philippines 14.1%

2.9%

Education

Thailand 13.1%

2.9%

Hong Kong 11.1%

1.9%

Indonesia 7.1%

1.9%

India 2%

1.0%

Energy & Utilities

1.0%

Healthcare

1.0%

Information Technology

Real Estate Arts, Entertainment & Recreation Mining

/ APRIL–MAY 2015 / www.cio-asia.com

10%

15%

20%

25%

BIG DATA

CIOs Have to Learn the

of basic concepts behind algorithms can help avoid bad results and bad press. “Algorithms allow us to get rid of biases we thought were there in human decision-making,” says Michael Luca, an assistant professor at Harvard Business School. “But pitfalls are equally important to think about.”

Math Magic

of Analytics Today’s data-driven business runs on the almighty algorithm. But if you’re not careful, those geeky formulas can stir up legal and ethical trouble. BY KIM S. NASH

We’re used to algorithms recommending books,

movies, music and websites. Algorithms also trade stocks and predict crime, identify diabetics and monitor sleep apnea, find dates (and babysitters), calculate routes and assess your driving, and even build other algorithms. These math equations, which can reach thousands of pages of code and routinely crunch hundreds of variables, may someday run our lives. Companies increasingly use them to run the digital business and gain competitive advantage. Unleashing an algorithm can lead to new customers and revenue, but it can also bring encounters with ethical and legal trouble. Already, consumer advocates and regulators are training their sights on the dark side of the algorithm revolution, such as creepy over-personalisation and the potential for illegal price discrimination. As CEOs look to chief digital officers and data scientists to conquer the next frontier, CIOs have sometimes been on the sidelines, whether by choice or default. But as business leaders, CIOs may now have to elbow into meetings where Ph.D.s, corporate lawyers and other colleagues are talking about the data-driven future. CIOs need to join those conversations to help steer company strategy, certainly, but also to contribute to decisions about what data to pour into an algorithm and what to keep out, and how to monitor what the algorithm does. That includes devising a defensible policy for handling the information produced, says Frank Pasquale, a professor of law at the University of Maryland. “Algorithmic accountability” will become part of the IT leader’s job, he says. That realisation can hurt. Athena Capital Research, a high-frequency stock trader, used a proprietary algorithm called Gravy to slip in big buy and sell orders milliseconds before the NASDAQ exchange closed for the day in order to push stock prices higher or lower, to Athena’s advantage. The Securities and Exchange Commission viewed that as illegal manipulation and last year called out Athena’s CTO for helping other managers plot the most effective use of Gravy during at least six months in 2009. Athena settled the case for US$1 million. No one says CIOs must delve into Ph.D.-level math. But a working knowledge

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Algorithms can be used to make operations more efficient, answer “what if” questions and make new products and services possible. At United Parcel Service, the 1,000-page Orion algorithm does all of that. In 2003, UPS started building Orion (for On-Road Integrated Optimisation and Navigation) to optimise delivery routes. You might have six errands to do on a given day. A UPS driver has about 120. The company wanted to save time and fuel by having drivers follow the most efficient routes possible while still making deliveries on time, says Jack Levis, director of process management. Levis oversees Orion and the team of 700 engineers, mathematicians and others who support it. Cutting just one mile per driver per day saves US$50 million per year, Levis says, and Orion has so far saved seven to eight miles per driver per day. UPS is on track to save US$300 million to US$400 million per year in gas and other costs by 2017. The most important thing any manager can do when embarking on an algorithm project is to “work backwards,” Levis says. That is, define carefully what business decisions the company struggles with, then identify what knowledge would help—what information you’d need to teach you the knowledge you lack. Then identify the raw data that—when combined and teased apart and interpreted—would provide that information. UPS spent nine years working on Orion before putting it into production, adding and subtracting data, testing, then adding and subtracting again. For example, at first Orion used publicly available maps. But they weren’t detailed enough. So UPS drew its own, showing

Research Report - Backup and Disaster Recovery

What does the future hold for SME IT Investment? The amount of information small-medium enterprises has to manage is accelerating at a rapid pace, creating new challenges every day. To uncover these unique challenges we undertook a survey of organisations across Asia. Our hope is that you’ll use the outcomes of this report to see how your data management practices match up. Whether it’s recovering a single file or getting an entire database back online after an outage, SMEs place great value on ease of use, costs and setting realistic recovery objectives.

Key Challenges for Protecting Virtualised Environments

79%

Data Management Challenges

Managing backups

Investment costs

Meeting recovery objectives

Key Driver for Backing Up Data

of SMEs cite data availability as a critical concern in their backup and recovery efforts.

Ensuring high data availability Protect against risk to business for data loss Disaster recovery requirements

86% 77% 73%

When asked about the key challenges of protecting virtualised environments, 60% had issues with data retrieval and over 75% faced challenges with general management and administration. Meeting recovery time objectives Ensuring the security of the backed up data Meeting recovery point objectives Ability to do granular recovery

Current Management of Data Backup Backing up to a local disk is the preferred method with more than 40 percent using this solution to back up their corporate data.

43%

Areas of Highest Data Growth

cited growth in data stored in centralised file servers and FTP servers as growing significantly.

User data (eg. File servers, FTP servers, etc.) Databases (eg. SQL, Oracle, etc.) Application data (eg. in Exchange, Sharepoint, Web servers, etc.)

92% 68% 61%

79% 79% 75% 60%

Back up to local disk only

25%

14%

Back up to tape only

Back up to disk to tape

Data Growth & Future Plans

Nearly a quarter of SMEs report losing critical business data from a failed backup.

24%

of SMEs expect annual growth in data volumes of between 20% to 60%.

YES

1-6 months’ time

Conclusion

1-6 months’ time

Download your FREE copy of the Research Report from www.cio-asia.com

This survey’s results strongly suggest that SMEs are overly reliant on existing storage technologies and are averse to seeking out upgrades. They are confident that their existing solutions will suffice and scale for future growth in data volumes.

NO %

Proudly sponsored by

BIG DATA features such as a customer’s half-mile driveway or a back alley that shaves time getting to a receiving dock—data points that Orion needs in order to plan how to get a package delivered by 10:30 a.m. But an algorithm created by data scientists in a laboratory can’t anticipate every factor or account for every nuance. Suppose a business customer typically receives one package per day. If Orion knows the package isn’t tied to a certain delivery time, the algorithm might suggest dropping it off in the morning one day but in the afternoon the next, depending on the day’s tasks. That might be the most efficient approach for UPS, but customers wouldn’t know what to expect if delivery times changed frequently. People don’t like that amount of uncertainty, and it might have cost UPS business. Companies often take deliveries in the morning, go about their business during the day and then call UPS back to request a late-afternoon pickup of an outgoing package. If UPS pushed deliveries to the end of the day for efficiency’s sake, it might not get that later call, Levis says. “We started realising the rules we told the algorithm weren’t as good as they should have been,” he says. “We’ve learned you need to balance optimality with consistency.” The Orion team is outside IT, but Levis says the IT group built the production version of Orion and CIO Dave Barnes understands what Orion can and can’t do, which is critical when he helps UPS devise business strategy. UPS’s My Choice service, which notifies customers of pending deliveries and lets them change delivery times or locations, wouldn’t be workable without Orion, Levis says. Not only does My Choice reduce multiple delivery attempts, it also brings in new revenue: 7 million customers have signed up for the service and pay US$5 per change or US$40 per year for unlimited changes. Next, UPS wants to bring it to other countries. To grow new business from algorithmic insights, companies must look for correlations that competitors haven’t spotted.

Chris Hartlove

When developing an algorithm, first identify a business problem, then identify the data you need to solve that problem, says Jack Levis, director of process management at UPS. Take H&R Block, for example. In December, executives at the provider of tax filing software and services talked in detail with financial analysts about the company’s new algorithm, which tailors marketing email messages and in-software pop-up boxes to individual customers. The company rolled it out this tax season, after starting algorithmic tests to quantify and categorise the behaviour of 8,700 tax filers in an effort to predict what customers will do. CMO Kathy Collins discussed how, for example, H&R Block may know that, based on past behaviour, you’re typically a February filer who prefers to interact with the company via mobile device. If you haven’t filed by Feb. 10, the algorithm will suggest that someone nudge you with an email reminder and a discount on help preparing your return. Other customers may receive an email offer the week they receive their W-2 forms. Over time, H&R Block expects to improve its algorithm by analysing not only the content of customer tax returns but also the very clicks a taxpayer makes while using its software, said Jason Houseworth, president of global digital and product management. “In our case,” he said, “the personal data is as rich as it gets,” The personalisation made possible through the algorithm, Houseworth said, “will make each user feel that the software was not only designed for them, but is always a step ahead.” Some customers may like that, but others won’t, says Pasquale, who wrote The Black Box Society: The Secret Algorithms That Control Money and Information. “There’s so much pressure to know more. That’s the arms race I fear.”

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The idea of knowing more about people is a driving force at eHarmony. The dating service matches members by their self-identified characteristics, such as hobbies and sexual orientation. But eHarmony also extrapolates what it calls unstated “deep psychological traits,” such as curiosity, by putting answers to questionnaires through various formulas. A neural network also produces a “satisfaction estimator” to rate potential pairings, and the system learns over time, as members report back about their satisfaction with matches eHarmony suggests. The company doesn’t have a CIO; COO Armen Avedissian handles that role. Decisions about whether to change the algorithm are made by a team that includes Avedissian, CTO Thod Nguyen, vice president of matching Steve Carter and corporate lawyers. “It’s not just hardware and software but the tactics and strategy of data manipulation,” Avedissian says.

Daniel Hennessy

At eHarmony, decisions about altering the algorithm that matches people involve “the tactics and strategy of data manipulation,” says COO Armen Avedissian. The company looks at 29 dimensions of compatibility, such as “emotional energy” and “curiosity,” each of which incorporates several variables collected through detailed questionnaires. More than 125TB of data is involved. The algorithm learns by assessing what a member does with each match that eHarmony suggests (contact right away? ignore?) as well as what feedback the members provide in questionnaires and open-ended responses. That data gets poured back into the equation and the cycle starts again, more informed, Avedissian says. The more relevant the matches, the higher the rate at which members will communicate with each other. The more they engage, the more likely they are to buy annual subscriptions. All the algorithms at eHarmony are intended to convert registrants into subscribers.

Examples of Algorithms in Action

Companies use algorithms in all sorts of systems to make money or optimise operations, and sometimes both at once. Here’s a sampling. Putting the Squeeze On | Coca-Cola’s Minute Maid division optimises drink blends--especially orange juice--by understanding consumer preferences about factors such as mouth feel and pulp content. But operations variables are also figured in, including freight and labor costs. Coca-Cola wants to create not only juices that people will like, but also ones that work with the realities of its supply chain and production processes. Who’s Watching What? | Netflix knows that several people might share one household account, so it wants to be able to correctly guess who is using its video service and make appropriate recommendations without having to ask customers to identify themselves or answer questions during every visit. Toward that end, the company has developed an algorithm that analyses patterns of customer behaviour and alters movie suggestions based on certain variables. One is time of day. In the afternoon, the viewer is more likely to be a child. Late at night, an adult. In the future, the system might make gender and age assumptions based on how hard the customer hits buttons on the device he’s using. Shopping Around | Retailers have turned to algorithms to help solve the omni-channel puzzle. American Eagle Outfitters uses an algorithm to figure out how best to fulfil online orders with products shipped from physical stores. One goal: Focus on slow-moving products at low-volume stores that are within two days’ shipping distance of online customers. Monetising Small Talk | MeetMe, an app vendor that matches members for mobile chats, has an “icebreaker algorithm” that uses quantitative data points, such as location, plus qualitative information, like self-declared interests in certain games, to suggest partners. This year, MeetMe plans to improve the relevance of its matches so people will spend more time chatting. Longer encounters mean more exposure to ads and more revenue for MeetMe. Fasten Your Seatbelts | Auto insurers have long calculated premiums based on the number of miles someone drives, the customer’s age, gender, marital status, vehicle type, driving record and home address. Now Allstate is finetuning that process with an algorithm that weights each risk factor differently. For example, the relative risk related to a 16-year-old driver could be triple that of someone age 30 to 50. But Allstate doesn’t simply assume that all the miles a teenager drives are equally risky. Over the course of a year, for example, the miles driven at the start of a policy are probably riskier than the ones driven at the end because, of course, practice helps. So Allstate determines risk levels for both kinds of miles. However, there’s a point at which learning slows down and each mile after that carries diminishing returns. The algorithm tries to find the point in the year at which that likely happens.

The dating service tests ideas by running slightly different algorithms for different customers, then measuring the rate at which registered members convert to annual subscribers. Risk and compliance teams run their own algorithms to see how the company’s other algorithms are using sensitive data. One recent discovery: Whether someone smokes and drinks turns out to be more important in dating in Europe compared to the United States. Once eHarmony more heavily weighted the smoking and drinking variables in its matching algorithm in the U.K., “business just took off,” Avedissian says. Meaning, suggested matches were more on-target, therefore satisfaction increased—and so did conversion rates. However, not all outcomes are expected.

Unintended Consequences

Uber is upending the taxi business with an app to connect passengers with rides and a proprietary algorithm that, in part, governs “surge pricing,” which raises fares at times of heavy demand. Taxi associations from New York to Paris and back have protested Uber for cutting into their business, and government regulators have challenged the company on questions of fair pricing and safety. Even so, the darling of disruption has raked in an estimated $4.9 billion in investor funding. In December, the cold, hard math collided with high emotion: Uber’s algorithm automatically jacked up rates in Sydney, Australia, as people tried to get away from a downtown café where an armed man held 17 people hostage. Three people, including the gunman, died. Uber later apologised for raising fares, which reportedly were up to quadruple normal rates, and made refunds. “It’s unfortunate that the perception is that Uber did something against the interests of the public,” a local Uber manager said in a blog post. “We certainly did not intend to.” Problems are most likely to arise when algorithms make things happen

www.cio-asia.com APRIL–MAY 2015 31

BIG DATA automatically, without human intervention or oversight. Control is critical, says Alistair Croll, a consultant and author of Lean Analytics: Use Data to Build a Better Startup Faster. “If algorithms are how you run your business and you haven’t figured out how to regulate your algorithms,” he says, “then by definition you’re losing control of your business.” Uber is working on a global policy to cap prices in times of disaster or emergency, a spokeswoman says. Other unintended consequences involve the liability of knowing too much. For example, say a hospital uses patient data to identify people who may be headed toward an illness, then calls them to schedule preventive care. If the math is imperfect, the hospital might overlook someone who later contracts an illness or dies. Or a whole group of people could get overlooked. “There’s concern about who are the winners and losers and can the company stand by it later, when exposed,” Pasquale says. Sometimes companies don’t set out to uncover uncomfortable truths. They just happen upon them. Insurance company executives, for example, should think carefully about results that could emerge from algorithms that help with policy decisions, says Croll, the consultant and author. That’s true even when a formula looks at metadata—descriptions of customer data, not the data itself. For example, an algorithm could find that families of customers who had changed their first names were more likely to file claims for suicide, he speculates. Further analysis could conclude that it is likely those customers were transgender people who couldn’t cope with their changes. An algorithm that identified that pattern would have uncovered a financially valuable piece of information. But if it then suggested that an insurer turn down or charge higher premiums to applicants who had changed their first names, the company might appear to be guilty of discrimination if it did so, Croll says.

The CIO’s Best Role

The best way a CIO can support data science is to choose technologies and processes that keep data clean, current and available, says Chris Pouliot, vice president of data science at Lyft, a competitor of Uber. Before joining Lyft in 2013, Pouliot was director of algorithms and analytics at Netflix for five years and a statistician at Google. CIOs should also create systems to monitor changes in how data is handled or defined that could throw off the algorithm, he says. Another key: CIOs should understand how best to use algorithms, even if they can’t build algorithms of their own. For example, if a payment service needs to figure out whether pending transactions could be fraudulent, it might hard-code an algorithm into its payment software. Or the algorithm could be run offline, with the results of the calculations applied after the transaction, potentially preventing future transactions. The CIO has to understand enough about what the service is and how the algorithm works to make such decisions, Pouliot says. CIOs should, of course, provide the technology infrastructure to run corporate algorithms, and the data they require, says Mark Katz, CIO of the American Society of Composers, Authors and Publishers, which licenses, tracks and distributes royalties to songwriters, composers and music publishers. Katz meets regularly with ASCAP’s legal department to make sure the results of the algorithms comply with the organisation’s charter and pertinent regulations. “We’re all information brokers at the end of the day,” he says. CIOs can expect increasing scrutiny of analytics programs. The Federal Trade Commission, in particular, is watching the use of algorithms by banks, retailers and other companies that may inadvertently discriminate against poor people. An algorithm to advise a bank about home loans, for example, might unfairly predict that an applicant will default because certain characteristics about that person place him in a group of consumers where defaults are high. Or online shoppers

/ APRIL–MAY 2015 / www.cio-asia.com

might be shown different prices based on criteria such as the devices they use to access an e-commerce site, as has happened with Home Depot, Orbitz and Travelocity. While companies may think of it as personalisation, customers may see it as an unfair practice, Luca says. The Consumer Federation of America recently expressed concern that, in the auto insurance industry, pricing optimisation algorithms could violate state insurance regulations that require premiums to be based solely on risk factors, not profit considerations. Consumers, regulators and judges might start asking exactly what’s in your algorithm, and that’s why algorithms need to be defensible. In a paper published last year in the Boston College Law Review, researchers Kate Crawford and Jason Schultz proposed a system of due process that would give consumers affected by data analytics the legal right to review and contest what algorithms decide. The Obama administration recently called on civil rights and consumer protection agencies to expand their technical expertise so that they’ll be able to identify “digital redlining” and go after it. In January, President Obama asked Congress to pass the Consumer Privacy Bill of Rights, which would give people more control over what companies can do with their personal data. The president proposed the same idea in 2012, but it hasn’t moved forward. Meanwhile, unrest among some consumers grows. “Customers don’t like to think they are locked in some type of strategic game with stores,” Pasquale says. CIOs should be wary when an algorithm suddenly produces outliers or patterns that deviate from the norm, he warns. Results that seem to disadvantage one group of people, he says, are also cause for concern. Even if regulators don’t swoop in to audit the algorithms, customers may start to feel uneasy. As Harvard’s Luca puts it, “Almost every type of algorithm someone puts in place will have an ethical dimension to it. CIOs need to have those uncomfortable conversations.”

INTERVIEW Kerrie Holley, IBM Fellow and Master Inventor, is a business-savvy, technology executive and senior IT architect. He is recognised internationally for his innovative work in architecture and software engineering centred on the adoption of services and service-oriented architecture. He is part of IBM Yorktown Research focused on scalable business services and the emerging API economy.

Ensuring a successful cloud journey BY T.C. SEOW

Previously, Holley served as a CTO in IBM Global Business Services. He

collaborates and engages with clients as architect, researcher and consultant on topics in the “next era” of computing (i.e., confluence of mobility, social, analytics, cloud, cognitive and IoT), and its impact on software engineering, business processes applications, and IT architecture. In this exclusive email interview, Holley shares his views on cloud computing, security and what businesses need to do to become more agile, more secure, and eventually, more successful.

There has been emphasis on getting organisations to become agile in everything they do. How does one get to be agile? Is going to the cloud the best way of getting there? KERRIE HOLLEY: Becoming agile for most organisations will be a journey and not a destination. That is, some aspects of a company (e.g., applications or lines of business) need more agility than others so companies must prioritise and determine where the biggest payback can be achieved. Becoming agile, elastic or flexible requires a focus in multiple overlapping areas: people, process and technology.

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Cloud computing is not just a disruptive technology; it’s a trend and market disruptor. Yes, companies seeking more efficiency and effectiveness, improved agility, in their people, process and technology should pursue cloud adoption. Cloud computing has several game changing business enablers: business scalability, market adaptability, cost flexibility, mobile development, and ecosystem connectivity. Companies need agility for a myriad of reasons: turbulent economic conditions, intense competition, evolving customer expectations, need to optimise use of capital, or increasing regulations. Cloud can be a growth engine for business allowing companies to innovate while managing rapid change. Cloud computing provides the foundation to manage hybrid technologies. Cloud is said to be the natural progression of utility model of computing from the last decade or so. Why did it take such a long

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INTERVIEW Cloud can be a growth engine for business allowing companies to innovate while managing rapid change. Cloud computing provides the foundation to manage hybrid technologies. time to gain popularity now? What core technologies are at play to bring cloud benefits to organisations? Cloud computing as currently defined represents the early stage of a major revolution in how information technology systems are architected, developed, deployed and consumed. Cloud computing dominance as a technology disruptor mirrors the evolution of several technologies and trends: virtualisation, open source, explosion of tech startups (venture capital investment), software defined environments, open standards, lower cost of servers, storage and networking, which have all matured over the last few decades. Couple this with the rise of web platforms creating demand for network delivered services and you get the culmination of a long term trend to simplify the purchase of IT Services, cloud computing. The emergence of the public cloud is perhaps the clearer form of utility computing of the past, where computing resources are shared by members of the cloud. But privacy and security issues have forced some to build private clouds. Are private clouds the way to go for those who are concerned about such issues? First, let’s understand that public clouds are not utility computing. Utility computing relates to the business model in which infrastructure resources (i.e., compute, storage and software) are consumed. Utility computing refers to the ability to meter the offered services and charge customers for exact usage. Utility computing can be used without using cloud computing. Cloud computing has several attributes: scalable, elastic, self-service, service-based, and the use of Internet technologies. Relating to the previous question, how then should organisations address their security concerns on cloud? Companies may have several cloud computing security issues and should identify their concerns and ensure cloud providers have a strategy for addressing. Protecting sensitive data, visibility, cloud security policies, transparency, privacy, are just a few security concerns. Companies must verify that cloud providers services are as secure as they would be in your company’s datacentre. Companies should also identify which cloud services are most vulnerable to external attacks and review the cloud strategy accordingly. Hybrid clouds have been claimed to be the best route to bridge the gap between private and public clouds, so that organisations can tap on public resources where conditions allow, yet maintain close control over data issues when necessary. What’s your view on this? How would you advise organisations who want to take the hybrid route? I don’t see hybrid clouds as a bridge between private and public clouds, although by definition hybrid clouds reflect the adoption of both private, public clouds. Hybrid clouds are a natural adoption model for most if not all companies given the state of the art today in cloud computing. Some workloads will be best for public while others will require private clouds. Hybrid gives companies greater architectural flexibility, potentially improved security, operating system choice, ability to accelerate innovation, and in some cases the only way to meet compliance requirements

/ APRIL–MAY 2015 / www.cio-asia.com

while adopting cloud computing at the same time. Hybrid is the most flexible option and natural end state of cloud adoption. I recommend companies create a cloud adoption strategy addressing what workloads are suitable for public clouds and which need to reside on a private cloud. Is hybrid cloud the next logical step towards cloud computing? Hybrid cloud is the most likely end state for companies adopting cloud computing. It’s less the next logical step but more a natural cloud adoption model. Can you briefly comment how cloud has changed the way we work, live and play? Would the advent of cloud be later rather than later if trends such as consumerisation of IT and mobility have not emerged in the last five years? Cloud computing, fundamentally changes everything about how we work, live, play. Mobility growth is exploding with cloud as we use mobile devices and keep our music, pictures and documents in the cloud. Enterprises share and collaborate using cloud ser vices. Mobility and the consumerisation of IT clearly places more demand on IT infrastructures spurring the growth and innovation in cloud computing. Could you comment on the AppleIBM strategic partnership that was forged last year? That seemed to have underlined quite significantly the importance of mobile devices in service delivery and information consumption. How should organisations get started? The IBM and Apple partnership is helping to build business apps using some of IBM’s world-class technology, such as Watson, hosting those apps on its cloud, while helping enterprises customise and deploy the apps. Start by becoming a mobile enterprise, and check out some of the apps.

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EVENT REPORT

CIO-NTT Technology Outsourcing Forum 2015 More than a hundred ICT professionals in Singapore gathered at the Grand Hyatt Hotel on February 12 for the inaugural Technology Outsourcing Forum 2015. Organised by CIO Asia and supported by NTT Communications, this event aimed to let attendees learn more about the trends, the how’s, what’s and why’s of IT outsourcing from industry experts. BY ZAFIRAH SALIM

FROM LEFT TO RIGHT: TC Seow, editor, CIO Asia; Reuben Wee, CTO of Independent Data Services (Holdings) Pte Ltd; Chris Sandoval, NTT’s Chief Evangelist for Managed Services; Lawrence Ting, Regional Head of Datacentres and DR/BCP Manager, Global Technology Services, Asia Pacific, Societe Generale Corporate and Investment Banking; Theodoric Chan, Vice President, Global Network Transformation Taskforce, Network Services, NTT Communications Corporation.

akeshi Kazami, President and CEO of NTT Singapore, was the first to address the audience. In his welcome speech, Kazami provided a quick overview of NTT’s business, vision and services at the global as well as regional level.

State of outsourcing in Singapore

TC Seow, editor of CIO Asia, kickstarted the event proper with his presentation on the state of outsourcing in Singapore. Besides touching on general ICT trends and current top concerns of CEOs, Seow also shared the findings of a research study conducted by CIO Asia on behalf of NTT Communications Corporation. Titled ‘Technology Outsourcing Trends in Singapore 2015’, the study polled over 170 respondents from companies across a spectrum of industries. The report also highlighted the trends, challenges and drivers behind the current outsourcing

/ APRIL–MAY 2015 / www.cio-asia.com

landscape in Singapore. According to the survey, more than 77 percent affirmed ICT outsourcing as a general practice in their companies. Although that figure showed outsourcing to be favourable, ICT spending priorities remain focused on essentials such as hardware and infrastructure upgrades, as well as network technology. In terms of which business functions, most respondents were open to outsourcing in their organisations, with 66.5 percent citing Information Technology as the main business function outsourced. However, very few people seem to favour outsourcing Human Resources (5.1 percent) and Finance (6 percent). This was understandable, according to Seow, as these two business functions involved important, sensitive information that most businesses would not like to divulge; so they tended to see it as a risk in the hands of outsiders. When asked about their key concerns,

cost was still a strong argument for outsourcing as reflected by the lowly ranked concerns around budget constraints (7.9 percent). However, data sovereignty was a bigger issue, at 34.7 percent. The second big issue was industry regulation (22.8 percent), as data stored in the cloud was often subjected to not just local jurisdiction but also international laws. With regards to the outsourcing experience itself, most respondents cited reduction of operating costs (78.1 percent) and the desire to consolidate (71 percent) as important considerations in their most recent outsourcing effort. “It is obvious that we outsource to reduce operating costs. A second major reason is to consolidate, which means reducing the number of things we have to handle. We have to make it less so we can manage more and focus better on our core business,” said Seow. When asked which factors are the most

important when selecting an outsourcing vendor, overall quality of service, or QoS (79 percent), and pricing (71 percent) ranked the top two criteria. The ability of service providers to deliver an end-toend ICT solution was also rated highly at 56 percent of responses.

Transformation of enterprise network

“Every organisation is demanding business growth; and regionalisation and globalisation are always key to accelerating this growth,” said Theodoric Chan, Vice President, Global Network Transformation Taskforce, Network Ser vices, NT T Communications Corporation. According to a recent Ernst and Young Globalisation Index survey, Singapore ranks second highest amongst the world’s top 60 economies. Adding to this, Chan said that Singapore is currently one of the best locations to enable business globalisation. Business growth, however, came handin-hand with tremendous IT challenges; and it was only possible when these challenges were resolved as quickly as they arose. Such challenges brought about a transformation of traditional enterprise networks, said Chan. To sustain long-term business growth was not as simple as addressing core issues like productivity, process efficiencies, and managing demand and supply, he said. The advent of increased globalisation, mergers and acquisitions, diversified IT endpoints, and distribution of business ecosystems – plus changing working styles, such as mobility – all added to the problem. “The need for a fast response to everchanging global market dynamics, and the ability to operate efficiently across multiple business locations is essential. As such, organisations require a scalable IT environment that can grow in tandem with their business needs,” said Chan. “With the right technology, infrastructure and support, enterprise networks can overcome pain points.” He added that transforming the enterprise networks was part of the NTT

vision to help achieve business goals by providing a reliable, seamless and innovative connectivity. Leveraging on this, organisations could achieve better utilisation of IT resources, improve ability-to-market condition, as well as optimise cost and performance. This was essential because according to a live poll, the majority of the respondents (28.2 percent) cited reliability and security as their biggest challenges in managing enterprise networks. Chan also drove the idea that softwaredefined networking (SDN) and network functions virtualisation (NFV) would enable cloud-based network services to help businesses simplify delivery and operation, boosting the efficiency, effectiveness and security of the enterprise network.

Innovation in outsourcing

The final speaker of the day was another representative from NTT, Chris Sandoval, who is NTT’s Chief Evangelist for Managed Services. Sandoval shared various survey findings, as well as a prediction report by Gartner, that highlighted the transition of IT’s role from aiming to improve ICT infrastructure to improving the business itself. During a live poll session, 29 percent of the attendees cited cost as their biggest business challenge. But from personal experience dealing with various customers over the years, Sandoval had a different opinion. “Reducing cost is a common conversation with our customer. But from a CEO’s point of view, in terms of new initiatives such as digital marketing and customer experience enhancement, increased costs may be OK if it helps create more business,” said Sandoval. In short, IT has begun to be a strategic partner to the business, he said, and advised the audience to “re-examine the role of IT within your organisation; if you align yourself to drive business innovation, sometimes the cost discussion becomes less important,” he added. Sandoval also talked about how businesses could leverage NTT’s Global Management One (GM1) to drive value

for their businesses, which provides a robust portfolio of ICT Managed Services spanning the entire ICT landscape. “This management service platform integrates and orchestrates the whole IT ecosystem to provide a single pane of glass. IT administrators can see the landscape from end-to-end and get a better sense of what is going on in the whole environment,” said Sandoval. NTT’s GM1 is offered globally from six service centres worldwide (with a seventh one to be launched in the U.S. this year) and supported by over a thousand qualified engineers with 150 unique industry certifications. Customers can leverage GM1 to complement their existing resources, address any challenges, or fully manage their day-to-day ICT operations, thereby freeing their limited IT staff to focus on more strategic initiatives. Sandoval also shared three customer case studies to highlight how NTT has helped them with their end-to-end IT ecosystem management to address business needs and drive growth.

Value and vulnerabilities of ICT outsourcing

Concluding the forum was a panel discussion that explored the pitfalls and opportunities of ICT outsourcing. Besides Chan and Sandoval, members of the panel included Reuben Wee, CTO of Independent Data Services (Holdings) Pte Ltd; as well as Lawrence Ting, Regional Head of Datacentres and DR/BCP Manager, Global Technology Services, Asia Pacific, Societe Generale Corporate and Investment Banking. Together with Seow as the moderator, the panel discussed what should be outsourced and what could be managed in-house, as well as the fundamental considerations when evaluating an outsource provider, who ultimately should be selected based on long-term relationships rather than just a business arrangement. Sandoval viewed outsourcing as a gradual relationship building that takes time. Wee shared the same sentiment, adding that the relationship with a

www.cio-asia.com APRIL–MAY 2015 39

/ APRIL–MAY 2015 / www.cio-asia.com

INTERVIEW

vendor should be regarded more like a “high-value partnership”. According to a live poll, almost half of the attendees (49 percent) voted ‘overall QoS’ as the top consideration when choosing an outsourcing partner, which was in agreement with the CIO Asia survey findings revealed earlier. From a provider’s perspective, Chan focused on two major areas – operation and customer relationship. “NTT possesses over a hundred years of operation experience. We are located at the hometown side of Japan, where we often experience natural disasters such as earthquakes. We always operate in a very extreme environment, but this highlights that we are still able to deliver good service to our customers despite the circumstance. We are very resilient in our service delivery,” said Chan. “Secondly, QoS also boils down to the customer relationship itself. The provider must be able to understand the business culture and business requirements of the customers, as well as its regional needs. This will help them to better understand the customer; and in turn, meet or even exceed the customer’s expectations,” he added Building on this view, Ting said that providers must also consider how they could continue to ensure the QoS was delivered throughout the contractual period, and this was where the cultural fit and account management would come into play. As a whole, providers must learn to be proactive and flexible to accommodate customer’s requests to ensure better service delivery. Another live poll revealed that majority of the attendees (42 percent) were unwilling to outsource security. Sandoval reasoned that customers did not want to give up control of what was most critical to them. “Once customers build a good relationship with their outsourcing partners, a trust relationship gets established. And as they recognize the benefits of outsourcing, eventually, they may be comfortable enough to entrust their critical business functions to be outsourced,” he added.

The Hybrid Way to Managed Services CIO Asia’s Zafar Anjum caught up with NTT Communications’ Theodoric Chan and Chris Sandoval recently to talk about IT outsourcing, hybrid clouds and demand for managed services in Asia. BY ZAFAR ANJUM

R Chris Sandoval

ecently, CIO Asia, together with NTT Communications, organised the inaugural Technology Outsourcing Forum 2015 in Singapore. Hundreds of ICT professionals attended the event. On this occasion, we interviewed Theodoric Chan, Vice President, Global Network Transformation Taskforce, Network Services, NTT Communications and Chris Sandoval, NTT’s Chief Evangelist for Managed Services. What resulted was a fascinating discussion on IT outsourcing, hybrid clouds and demand for managed services in Asia.

CIO Asia: What are the challenges enterprises face today in terms of data Theodoric Chan and their networking needs? THEODORIC CHAN: IT end points nowadays is very different from what it was five to 10 years ago—business units are worldwide located, partners may be physically far away from you, but need to be very interconnected together. Mobility users keep on increasing. Expansion, time to the market, these are always challenging. It is like almost as soon as you have an idea, you have to start the deployment right away. So, all those are common challenges. In some industries, they need to be very fast in market dynamics. So they need the data analysis, data visibility very fast, while some are a little bit focused on the security areas. CHRIS SANDOVAL: One of the challenges today is just the proliferation of data. A transpacific flight generates 1 terabyte worth of data, and how many planes are flying around? And that’s just one industry! Then how do companies derive value from and monetise the data? Of course that’s where the analytics comes in. But now you’ve got to serve that data to your business users at performance appropriate to the required workload. The challenges add up. CIO Asia: How is NTT solving the problems of data and cloud opportunities for customers? CHAN: We offer services in different layers. First of all, we are very focused offering good on infrastructure services in which we have invested end-to-end. Today, we operate more than 130 150 data centres globally, most of them are self-built, self-owned and self-managed. The data centre is the key location where the cloud environment is hosted. We also invest in inter-connecting the data centres in a very diversified way, on a global basis. We have ownerships on multiple sub-marine cables. We are focusing not just on the bandwidth but

EVENT REPORT also the values in terms of reliability and diversity as well as the latency benefit to customers. We own PC-1, ASE and other extra-low latency cables between the U.S. and Asia, as well as in the Asia region. We are very focused on technology innovations and IT management consultations to support customers to address business needs. We launched the industry’s first cloud networking services with instant self-service activation and pay-per-use model on global basis last year. SANDOVAL: Data is, sadly, not that mobile. You get 10 or 12 terabytes of data in a data centre. It is very hard to move that out and very hard to get it to where your users might be or serve it at performance appropriate to the required workload. We offer a multi-tiered storage option with our cloud services that can cover dynamic allocation based on the application or business criticality of the request. There are a lot of exciting things going on in the storage industry these days, and together with our technology partners, we are bringing these services to the market. Another great thing we have been able to do to help customers deal with very large data is by bundling our cloud service and network services such as WAN acceleration or content delivery, we can greatly increase performance and throughput—making it possible to work on CAD and other very dataintense applications in a complete virtual environment. CIO Asia: What about the data sovereignty issues? SANDOVAL: Yes, the European Union has a lot of restrictions around where data can go. We have set up our enterprise cloud (call it our availability hub) in 15 different countries. You can store your data wherever you need to, in compliance with the law. That is very helpful for companies that are dealing in multiple products and working in multiple areas of the globe. CIO Asia: How is your enterprise cloud different from other cloud providers? CHAN: There are a few differences. We are not just focusing on private

cloud. In essence, we are providing the hybrid cloud solution to the customer. Also, our cloud environment is a managed environment. The hosting environment and network connectivity are managed end to end. So this is part of the differentiation. Secondly, we also provide quite a flexible way to access the cloud applications as well as innovative business models. SANDOVAL: You talk about hybrid cloud. Starting with our Global Cloud vision, we embarked on this journey starting with our cloud platform. Customers needed help migrating, so we developed the migration services to aid our customers. Then we realised not everything is ready for the cloud. There may be technical limitations, or financial asset depreciation schedules to consider. Whatever the reason, some things need to remain on premises. So we developed Global Management One to provide a single pane of glass whether that device is in the data centre, in the cloud, or on premises. I think this holistic combination of the cloud platform, the professional services that enable migration and the end-to-end management of hybrid, heterogeneous environments sets us apart from other providers, and is something that people absolutely need. CIO Asia: Give us a sense of your customers—what kind of cloud services they are opting for? CHAN: Most of our customers opt for the hybrid way. For hosting environments like the data centre, most of the cases are that of infrastructure-as-a-service. That’s very popular. In general, like in ERP or CRM areas, most industries are moving to the cloud environment. SANDOVAL: Our customers and the market in general are hybrid. Gartner termed the hype cycle—where is the cloud in that? I think the cloud has passed the “over hyped” stage and the hybrid model is emerging as the predominant model. CIO Asia: Why should CIOs go for managed IT services? CHAN: It is very simple. The user experience, technology evolution—

everything is moving so fast. And very dynamically. IT talent management is another issue. In most of the markets, to retain IT talents is a tough challenges for CIOs. SANDOVAL: You have to be careful about what part of IT you are talking about [to put under managed services]. And you have to think: is this IT initiative very tactical in nature or is it strategic for the company? If it is strategic, then you should probably keep it and focus on that yourself. But if it is a tactical project, and a provider can do it cheaper, or more efficiently than you could yourself, or if you don’t have or can’t acquire the knowhow or the talent to provide services your business demands, then you should think about engaging a partner. CIO Asia: What are the new technologies that you see on the horizon? CHAN: We believe it is virtualisation. Cloud is in the mainstream of the trend. In terms of virtualisation, we do see that virtualisation could be applied to more devices. Innovation is evolving and how you play with your apps on your smart mobile devices—that scenario is not far off (for enterprise managed services too). SANDOVAL: Robotic process automation is huge right now; and in many cases, it is already hitting the second generation. Cognitive agents such as IPsoft’s Amelia or Apple’s Siri represent a new paradigm for the traditional help desk. IPsoft is a major technology partner for us; we have completely integrated their IPCenter platform into our service delivery model leveraging their automation prowess. Not only does this allow us to provide fast, reliable responses to customer incidents it helps ensure workflow compliancy so that we can maintain consistent quality of service worldwide. In the U.S. or Europe, many companies are in the second or third generation of outsourcing. The market is very savvy, and very competitive. Labour arbitrage is over, but with automation, we can provide a consistently high service level at a competitive cost.

www.cio-asia.com APRIL–MAY 2015 41

CLOUD COMPUTING

FIVE THINGS ABOUT

HYBRID CLOUDS 1.

The definition varies.

What are hybrid clouds? Should you be too concerned about its definition and application? Here’s why. BY BOB VIOLINO

There’s no consensus definition for what makes up a hybrid cloud environment, says IDC analyst Benjamin McGrath. “At the very least, it requires a mix of cloud and/or on-premises IT,” he said. “But some would add the requirement for the entire environment to be managed under the same umbrella. And some would add a portability component, where workloads can shift across public and private clouds, or nonclouds, as needed.” Hybrid clouds are more than just private and public cloud combinations, said Gartner analyst Ed Anderson. “Hybrid cloud is anytime you combine two or more clouds in a coordinated configuration,” he said. Vendors like to position hybrid cloud as the combination of their private cloud offerings and their public cloud offerings, Anderson said, but that is “only a small subset of the possible hybrid cloud configurations.”

Start planning now.

Whatever cloud technology it has today, a company is likely to end up with a hybrid cloud in the near future, Anderson said. “It’s better to be proactive and establish a framework for hybrid cloud now, so as new cloud services are introduced to the environment they have a home,” he said.

These are the big leagues.

“Organisations with a hybrid cloud strategy are generally more advanced both in terms the people within the organisation and the processes in which they engage with their technologies,” McGrath said. “A hybrid cloud environment is the goal state for a lot of cloud-using organisations.”

Many tools are available.

The tools to manage hybrid clouds come from many sources, including cloud management vendors, IT operations management vendors, pure-play cloud management startups and cloud service providers—which have their own tools for their platforms, Anderson said. "Organisations implementing hybrid cloud should consider their wide array of options, most likely including the IT operations management tools they are using today,” he said.

Expect management challenges.

Organisations that aspire to having a hybrid cloud strategy face big challenges because they must get to the point where they have a unified service catalog for IT resources and the ability to define cloud management policies and servicelevel agreements, McGrath said. “A lot of organisations have adopted some sort of cloud, or even some public and private clouds, and nearly everyone still runs some workloads on-premises,” he said. “But the key to a hybrid cloud environment is being able to manage those different deployment options.”

/ APRIL–MAY 2015 / www.cio-asia.com

DATAPOINTS 99% of IT professionals want SDN to extend beyond the data centre but 93% say the ability to do so today is extremely or moderately limited. 80% insist that SDN programming must be simple before adopting. 94% of large companies around the world are currently researching SDN. —AVAYA 2015 SDN EXPECTATIONS REPORT

IT investments of the Asia Pacific excluding Japan (APEJ) government sector will increase to US$32.5 billion in 2018. Investments will increase at a five-year compound annual growth rate (CAGR) of 6.2%. Overall 2015 year-over-year (YoY) IT spending growth for the APEJ public sector expected at 5.9%. —IDC GOVERNMENT INSIGHTS REPORT

40% of the decision makers in Asia’s financial services institutions (FSIs) expect IT budgets to exceed 10% in 2015. Asian FSIs have relatively young core systems, with 32% of the respondents admitted to owning related IT assets that are less than seven years old. Three in five FSIs claimed to be committing themselves to private, hybrid and public cloud investments this year.

Almost 9 out of 10 residents in Singapore have access to a smartphone, the highest globally. Singaporean users top the usage of voice calls, text messages and instant messaging, compared to its Southeast Asian counterparts. The country also has the highest frequency of usage, with 79% of females and 73% of males using instant messaging daily.

—IDC FINANCIAL INSIGHTS REPORT

—DELOITTE TMT SURVEY

Printer consumable market in the Asia/Pacific (excluding Japan) reached

US$1,729.65 million

in Q4 2014. Market declined 0.5% sequentially but increased 4.0% year-on-year to reach this figure. Third party brands contribute about US$392 million out of the total consumable market. —IDC MARKET RESEARCH

Hybrid cloud adoption has grown 9% since 2013, with 27% uptake across the globe—the highest being the Europe, Middle East and Africa (EMEA) region (28%), followed by Asia Pacific Japan (APJ) and Latin America at 24%. 68% of the APJ respondents cited agility and security as positive factors, but 58% of the region also said that they are losing control of technology spending. —EMC REPORT

/ APRIL–MAY 2015 / www.cio-asia.com

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