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INFORMATION TECHNOLOGY PRACTICEINFRASTRUCTURE EXECUTIVE COUNCIL®
EMERGING TRENDS IN IT INFRASTRUCTUREFindings from the Vision for Infrastructure Working GroupApril 2009
© 2009 The Corporate Executive Board Company. All Rights Reserved. IEC4343609SYN
Key Finding
Driven by prolonged market turmoil, corporate operating models
are evolving less as the result of planning and more as the result
of experimentation with new concepts. Corporate end users
are also bringing much more sophisticated expectations for IT’s
workplace potential—the potential to enable successful business
experimentation.
At the same time, market conditions mandate aggressive IT
consolidation and global standardization. Technology roadmaps
should soften the conventional trade-off between service flexibility
and innovation, and hard-won economies of scale.
Participate Now in Our 2009 Emerging Technologies Adoption Surveys
• Technology Strategy and Business Trends
• Emerging Server Technologies
• Emerging Storage Technologies
• Emerging End-User Technologies
• Emerging Network Technologies
• Emerging Collaboration Technologies
EMERGING TRENDS IN IT INFRASTRUCTURE 2
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Introduction
Over the past decade, most organizations have
pursued a common path toward economies of
scale: standardize technologies and processes,
and consolidate the technology footprint.
Unfortunately these gains often come at the
expense of business responsiveness. To make
matters worse, today’s economic crisis is
accelerating change in core business models,
and IT organizations struggle to support
business processes that deconstruct, evolve,
and reassemble in response to market volatility.
As a result, computing power must pool when
and where needed, as driven by the business
opportunity at hand. The implications for IT
infrastructure strategy are more profound than
at any other point in the past 10 years.
In 2008, the Infrastructure Executive Council
launched its Vision for Infrastructure (VFI)
initiative—a working group of senior IT
executives from more than 100 companies
and public-sector organizations collaborating
to define the future of the infrastructure
function as well as assess the enterprise value
and risk associated with nearly 40 emerging
technologies across all infrastructure towers.
The collective wisdom of the participants—
sharing implementation experiences and
challenges without vendor bias—generated a
roadmap outlining mainstream technology
adoption paths through 2012, in the context of
today’s business environment.
This paper synthesizes the observations of the
group, both about the key trends impacting
the infrastructure function as a whole and
individual infrastructure technology towers.
EMERGING TRENDS IN IT INFRASTRUCTURE 3
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The New Economic Context for IT Infrastructure
Manage Mainstream Virtualization: Findings in Server Technology
Wait for Change Triggers: Findings in End-User Technology
Accept Deployment Risk: Findings in Storage Technology
Search for Clear Value: Findings in Network Technology
Respond to Need: Findings in Collaboration Technology
Conclusion
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Contents
EMERGING TRENDS IN IT INFRASTRUCTURE 4
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IT infrastructure strategy must balance supply and demand, and touchstone changes in both environments promise to reshape strategy for the next several years. As The Economist has argued, “…the information revo-lution has helped to unbundle existing companies.”1
Consequently, infrastructure organizations should think beyond efforts to weather the storm and look to models that can adapt to the post recession landscape—much as businesses are likely to evolve in everything from core processes to labor demographics and supply chain architecture. Four critical trends are fueling change in IT infrastructure strategy.
THE BUSINESS CONTEXT: INFRASTRUCTURE (DEMANDED) ANYWHERE
New business challenges, like the need to optimize unstructured workflows or improve remote team management, will demand more extendable services than those that exist today—many of which simply automate older, more rigid business processes and patterns. Sharply reduced planning horizons, new geographies, and new interactions will require adaptation to rapidly changing use cases across a near limitless variety of working environments.
THE END-USER CONTEXT: RISE OF THE TECHNOLOGY NATIVES
The proliferation of flexible, adaptable services in consumer sectors, along with growing fluency in their use, is likely to raise new and important ques-tions about the value of infrastructure assets. A gen-eration has entered the workforce completely fluent in consumer technologies, such that most end users are now likely to use more powerful and advanced technology at home than in the office, even in emerging markets. Consequently, expectations for the productive and collaborative potential of cor-porate IT—in knowledge management, support for virtual teaming, and performance over distance—have risen substantially.
THE TECHNOLOGY CONTEXT: VIRTUAL INFRASTRUCTURE GOES MAINSTREAM
Virtualization, now accepted as a part of nearly every production environment, has caused a seismic shift for infrastructure organizations, with the promise of even greater changes to come through “cloud computing.” The ability to separate logical from physical computing resources not only relieves strained capacity but promises a future in which infrastructure organizations can pool and dynamically allocate computing by need—whether to support an application, house data, or provide desktop resources to end users.
THE RISK AT HAND: MANAGING THE NEW CENTRALIZATION
Having already fueled a wave of consolidation projects, virtualization is likely to continue to reverse computing sprawl within organizations. Yet while the potential for virtual infrastructure may be evident, the path to realizing that potential is revealing its own challenges. Organizations in the midst of consolidation, centralization, and vir-tualization experience inherent tensions among goals of scale economies, responsiveness, and the ability to provision service over distance—such that Infrastructure Executive Council benchmarks show that companies that have gone through a recent data center consolidation see an additional 23 hours of downtime per year for critical applications.
The New Economic Context for IT Infrastructure
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EMERGING TRENDS IN IT INFRASTRUCTURE 5
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The rapid evolution of infrastructure clearly demands a corresponding evolution of management and strategy, with the potential to redefine the role of the infrastructure executive as much as that of the function itself.
TOWARD A VISION FOR INFRASTRUCTURE: HOW WE ENTERED 2009
The conclusions reached by participants in the Vision for Infrastructure initiative as they entered 2009 planning cycles confirm conventional man-agement wisdom in some areas and are surprising in others.
So many technologies, so few management solu-tions. Although the number of emerging technol-ogies under review at infrastructure organizations suggests a highly innovative environment, practi-tioners report few deployment benefits in efficiency, flexibility, and growth. Vendors focus on redefining technology but fail to effectively support required
business change needed for benefits realization. Practitioners report that the technologies with the greatest business potential often lack management tools, integration, and vendor support. Even where mainstream adoption is well underway, as with vir-tualization, considerable value appears to remain on the table until effective management strategies can be defined.
Investments in collaboration technologies likely to be hindered by underinvestment in other towers. Infrastructure managers anticipate deploying emerging technologies more rapidly in the col-laboration space than in any other. Yet ironically, investment in collaboration technologies may fail to realize full benefit due to limited investment in other, more traditional infrastructure towers like network. Many emerging network and mobility technologies remain several years away from main-stream adoption, despite their intersection with collaboration technologies and demand for “infra-structure anywhere.”
VISION FOR INFRASTRUCTURE: METHODOLOGY AND OPERATING MODEL
As an alternative to conventional, vendor-influenced technology evaluation, Infrastructure Executive Council staff created a technology screening model to baseline participants’ assessments of enterprise value and risk and developed technology tower-based cohorts to identify potentially disruptive management trends and technology implementation solutions.
Steering Committee
Heads of Infrastructure
Technology Trends Workstream
Architects and Tower Leads
Operating Model Workstream
Strategists and Program Managers
� Scope and prioritize group output and validate findings.
� Diagnose emerging technologies’ true costs and benefits and how to mitigate deployment roadblocks.
� Provide best practice recommendations and future predictions for trends like Sourcing and IT Service Management.
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Look for efficiencies inside the data center, not out in the clouds. Despite considerable press around cloud computing, infrastructure managers plan to pursue adoption of more efficient server and storage technologies, along with power and cooling man-agement tools. Mainstream adoption of cloud com-puting, by contrast, is not anticipated until 2011 or later.2 This seems evident of a larger pattern across all technology towers—with the exception of collab-oration—of adoption strategies that seek to improve management of the infrastructure base, rather than risk radical changes to that base.
Again, mainstreaming appears highly contingent on clarity around cloud computing as a solution for business change—a case not yet demonstrated, except at the margins.3 For the market, this suggests less of a need to argue over definitions and cloud com-puting’s potential as the future and more of a need to show how cloud computing can deliver value to changing business needs.
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EMERGING TRENDS IN IT INFRASTRUCTURE 7
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MAINSTREAMING VIRTUALIZATION IN ALL ENVIRONMENTS
Server virtualization is no longer a novelty for enterprise IT organizations, with both hardware- and OS–level virtualization in mainstream use for Windows and Linux environments. Unix virtual-ization is rapidly scaling the adoption curve as well, with broad deployment anticipated across organiza-tions by next year.
FROM ADOPTION QUESTIONS TO MANAGEMENT NEEDS
Such broad and relatively recent adoption suggests a shift in debate that is already underway, as com-panies move beyond the business case for virtu-alization to identify the right management tools needed to monitor, inventory, and manage the lifecycle of virtual machines. Companies will also be looking to new toolsets to manage integrated or end-to-end virtualization across server, storage, and desktop resources, as they pool computing power to maximize the utility of the underlying physical resource base.
RADICAL CHANGES UNLIKELY
Within the data center, blade servers and multi-threaded processors will continue to see broad near-term adoption, as the trend toward increasing computing density continues.
Perhaps surprisingly, many organizations are unlikely to consider adoption of cloud computing beyond SaaS until 2011 or later. Despite considerable press around cloud computing, security, integration, and maturity concerns will lead most companies to focus instead on improving the capacity of their internal architectures, particularly through near-term adoption of improved power and cooling management technologies. While cloud computing advocates have made a significant case for architec-tural change, the business case is not yet as evident.
Manage Mainstream Virtualization
Figure 1: Which of the Following Cloud Computing Services Does Your Organization Plan to Use in 2009? (Select All That Apply)
51–75% of Portfolio 4%
25–50% of Portfolio 12%
Less Than 25% of Portfolio 84%
n = 57 companies surveyed, December 2008.
Figure 2: Within Three Years, What Portion of Your Company’s Applications Will Be Running on Various Cloud Services?
Business Software-as-a-
Service Offerings (e.g., Salesforce.
com) 27%
Platform-as-a-Service (e.g., Google App Engine) 2%
Workgroup Software- as-a-Service Offerings
(e.g., Google Docs) 2%
Infrastructure-as-a-Service (e.g., Amazon Web Services) 15%
Don’t Know 55%
n = 60 companies surveyed, December 2008.Note: Pie does not equal 100% due to rounding.
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EMERGING TRENDS IN IT INFRASTRUCTURE 8
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Wait for Change Triggers
NO VIABLE ALTERNATIVE TO CURRENT ENVIRONMENTS
Despite the cost associated with end-user computing, enterprise IT organizations have yet to identify a clear technology alternative to current desktop environments. While 32-bit systems will be around for many years, the 64-bit architecture will emerge as the future for enterprise computing as support for 32-bit applications eventually lapses, and as new product releases come only in 64-bit form.
While desktop performance improves, alternatives to the current PC environment remain expensive undertakings despite their potential management benefits, particularly when they require additional server and storage architecture. Few have demon-strated a net cost advantage. Desktop virtualization in particular has promised considerable management and security benefits—leading many companies to roll out pilot efforts—but deployment costs are likely to inhibit adoption beyond certain cost-effective environments (e.g., call centers) until the technology matures further.
TRIGGERS FOR CHANGE?
That said, the forthcoming release of Windows 7, as well as a worsening security environment, may serve as triggers for companies to reconsider business as usual in desktop and application man-agement. Companies transitioning from Windows XP to Windows 7 may wish to employ application virtualization to decouple applications from OS deployment, lowering overall transition and opera-tions costs and mitigating deployment risk.
Figure 3: Cost Comparison Between Typical PC and PC AlternativesAnnualized Deployment Cost for 10,000 Clients Excluding Operations and Support
Figure 4: Which Best Describes Your Client Infrastructure Strategy?45 Companies Surveyed, December 2008
Typical Rich Desktop
Application Virtualization
OS Streaming
Desktop Virtualization
Terminal Server
Blade PC
0 1 2 3 4 5 6 7
69%
29%
2% 0%
Continue Following Microsoft’s Desktop OS Roadmap
Provide Services to User’s Own
Client Devices
Seek Microsoft
Alternatives Such as Linux Desktop OS
Use Virtualization to Decouple Desktop OS
and Software Lifecycles
Millions of U.S. Dollars
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EMERGING TRENDS IN IT INFRASTRUCTURE 9
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Figure 5: Storage Virtualization Adoption Rates and Assessed Value (September 2008)
Accept Deployment Risk
TECHNOLOGY TO RESOLVE MANAGEMENT STRATEGY FAILURES?
Infrastructure managers continue to struggle with double-digit annual growth in storage demand, capacity subutilization, and performance degra-dation stemming from unchecked data growth. The limited effectiveness of policy-based approaches like tiering, chargebacks, and information lifecycle man-agement are leading companies to more aggressive consideration of emerging technologies.
ADOPTION UNDERWAY, BUT CONCERN OVER DEPLOYMENT RISKS PERSISTS
Mainstream adoption of both storage virtualization and 4GB/8GB fibre channel SAN are anticipated across enterprise IT organizations in 2009, with most organizations also seeking to deploy both appliance-based replication and data deduplication technology in 2010.
Among these, companies assess appliance-based rep-lication as the technology most likely to deliver the greatest enterprise value due to its ability to improve organizations’ disaster recovery capabilities.
Broad concerns exist among companies over the deployment risk associated with these and other technologies (storage cluster file systems, dis-tributed virtual tape, wide-area SAN, and storage resource manager) slated for mainstream adoption in 2011. Driven by both the growth of storage and its major root cause—data retention requirements—companies are understandably wary of the scal-ability and security risks associated with any storage solution and are also looking to the vendor com-munity to provide mature management toolsets to assist in governing storage architectures.
STORAGE—ASSET OR PROCESS?
Leading organizations focus on identifying risks in the storage management process to reduce vendor costs and improve storage utilization.
Cummins used failure-mode risk analysis to diagnose more than 200 points of risk and expense in storage management and developed customized contract clauses to transfer management and costs associated with the most critical risks to its vendor.
Full Implementation 20% Aware of
Technology 27%
Evaluation or Assessment 27%
Early Implementation 27%
Faster storage provisioning
No customer downtime during migration
Flexibility to migrate data among tiers in response to business need
Note: Pie does not equal 100% due to rounding.
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2007 2009 2012(E)
2,193
4,140
9,839
Search for Clear Value
CLEAR RISK, UNCLEAR VALUE
Unlike other technology towers, investments in emerging network technologies can be more art than science for companies, due to the difficulty in quan-tifying clear business benefits. None of the network technologies evaluated by Vision for Infrastructure participants are anticipated to deliver high levels of enterprise value, while participants associated medium or high levels of risk for each of the tech-nologies under consideration.
STICKING TO SAFE BETS
In 2009, companies are likely to restrict network investments to two safe bets—WAN optimization and video over IP. Sharp reductions in corporate travel budgets are likely to accelerate adoption of each, as companies increase their use of videocon-ferencing solutions for collaboration and client com-munication. WAN optimization also offers network performance enhancement while avoiding the levels of capital spend necessary for major network upgrades—an economically attractive proposition, considering recent sharp increases in the cost of capital for most organizations.
Figure 6: Forecasted Growth in Business IP Traffic (Average Petabytes per Month, 2007–2012)
According to Infrastructure Performance Improvement Laboratory data, 92% of companies will have deployed at least one WAN optimization technology by mid-2009 to counter a 35% compound annual growth rate (CAGR) in network traffic.
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UNDERSTAND NETWORK IMPACT ON END-USER EXPERIENCE
Infrastructure Executive Council research indicates that variance in service delivery is largely introduced in the WAN, leading progressive companies to combine standard metrics with a variation-based view of WAN performance.
Rather than attempt to manage to absolute latency targets, Schlumberger probes end-user tolerances across a range of response latencies for key transactions and uses a single index to measure variance in performance at each global site.
Outside of a limited number of industries, such as retail, most companies have yet to discern clear business value in advanced technologies like RFID systems, VoWiFi, and IPv6, making mainstream adoption unlikely before 2011.
Perhaps surprisingly, mainstream adoption of advanced mobility solutions, including 3G and 802.11n, is unlikely before 2010, assuming com-panies’ security concerns with these technologies are resolved. Indeed, it appears—from the per-spective of network investments—that collaboration over the network remains, at least in the near term, a matter of collaboration between fixed points, rather than across a highly mobile user base.
Future adoption and investment trends in network technologies will depend not only on the current economic crisis but, critically, on trends in other technology areas, driving demand for improved network performance and utilization. Increased adoption of desktop virtualization, software-as-a-service, and other network-dependent technologies may drive more aggressive adoption of emerging network technologies, but companies are unlikely to change their perceptions of value in stand-alone investments in the network.
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Respond to Need
BUSINESS NEED DRIVING RAPID ADOPTION
The Vision for Infrastructure roadmap indicates that collaboration is the fastest moving area of emerging technology adoption, with most tech-nologies reaching mainstream adoption by 2010. Although most companies lack systematic methods to determine the business value of collaboration technologies, clear business need for collaboration among teams, external partners, and customers likely influences early adoption. Moreover, the global economic slowdown and its effect on corporate travel budgets accelerate interest, particularly as companies express dissatisfaction with traditional solutions.
The accelerated adoption of emerging collaboration technologies is also likely due to a lack of perceived deployment risk. Despite some questions over tech-nology maturity and standards, many companies proceed with wide beta testing where possible, par-ticularly for Web 2.0 or Enterprise 2.0 technologies, and mitigate risk by concentrating spend with large, established vendors, such as Microsoft and Cisco Systems, rather than with smaller providers.
Figure 7: How Do You Expect to Change Your Collaboration Strategy as a Result of Recent Economic Turmoil?57 Companies Surveyed, December 2008
54%
14%
11%
24%
Expand Offerings—Focus on Maximizing Business Productivity and Travel Reduction
Contract Offerings—Focus on Reducing
IT Infrastructure Expenses
Reallocate Spend Among Available
Offerings
No Change
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EMERGING TRENDS IN IT INFRASTRUCTURE 13
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BUILD RETURN INTO COLLABORATION TECHNOLOGIES
Leading companies unlock the productivity benefits of collaboration tools by studying next-generation behaviors and workflows to roadmap technology and nontechnology support.
Ford Motor Company has initiated a digital worker steering committee to reconcile collaboration requirements across the organization, allowing the company to create a capabilities-based enterprise roadmap to guide collaboration.
Procter & Gamble has created a process for validating the benefits of collaboration solutions in terms of “minutes per week” a collaboration solution will save employees and has set a goal of returning 1 billion worker minutes to the company through collaboration tools.
Volvo AB has decreased travel costs for virtual teams by 50% using a simple assessment methodology to identify where virtual teams need help and a single number to track virtual team effectiveness over time.
FIXED-POINT RATHER THAN MOBILE SOLUTIONS
At this stage, the clear focus for spending on col-laboration technologies is to respond to an urgent business need: to improve communication between geographically separate but fixed points across the enterprise. In a parallel to findings in network tech-nologies, VFI participants also assessed that they would be far less likely to adopt mobile collaboration technologies, such as customized BlackBerry appli-cations, than they would unified messaging, desktop video, and other offerings.
While spending on collaboration technologies is likely to increase over the near term, spending outside this paradigm will depend on companies’ ability to define clear ROI and use cases for produc-tivity benefits less tangible than substitution for cor-porate travel—use cases that may depend more on a greater, cross-tower vision for investment.
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EMERGING TRENDS IN IT INFRASTRUCTURE 14
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RECESSION AND THE RETRENCHMENT TRAP
Evident across these findings is the sense that, despite the considerable hype around many emerging tech-nologies, corporate infrastructure organizations entered 2009 poised less for radical change than for aggressive cost and risk management. Despite the level of disruption in the technology environment, infrastructure organizations are focused first on managing the greater disruption in the economic environment. The result is a mix of both expected conservatism in some technology towers and rapid movement in other areas promising savings at low risk.
As one CIO has suggested, the danger in this posture is that IT organizations risk cutting “nerve tissue”—the ability to maintain responsiveness—as they cut fat from their operations. It would be a mistake for infrastructure executives to assume that today’s retrenchment marks a retreat from the trends of increasingly globalized business operations, inte-grated business supply chains, and diverse customer markets—meaning that demand trends for perfor-mance over distance, agile provisioning, and adapt-ability will grow stronger.
WATCH FOR OPPORTUNITIES TO ENABLE BUSINESS CHANGE
As the economic turmoil continues, it is possible that more radical change may become evident as companies and entire industries go through restruc-turing. Firms are twice as likely to experience sig-nificant changes in market share during a downturn than in conditions of economic growth. Recessions have a way of changing the calculus between winners and losers, as markets and opportunities rapidly and dramatically change.
Emerging infrastructure technologies that deliver adaptive flexibility are likely to be a key ingredient in post-recession success stories. Already, the con-tinued march of virtualization suggests a coming recentralization, in which leaner infrastructure organizations can proliferate highly utilized com-puting power across distant points without prolif-erating underutilized hardware. The trend toward speedy adoption of collaboration technologies sug-gests a similar, shared vision of better computing over distance.
Adoption patterns in collaboration technologies also highlight a core principle for infrastructure execu-tives and their priorities in today’s environment. While the ROI potential of collaboration technol-ogies is not yet clear, they offer IT leaders an oppor-tunity for business enablement, rather than just an efficiency solution.
BEWARE TECHNOLOGY CHANGE DRIVEN ONLY BY TECHNOLOGY EFFICIENCY
By contrast, the conservative approach to adopting other technologies by many stems in large part from fear of management risks. Even when it comes to virtualization, enterprise IT organizations continue to point to a lack of effective management tools, inte-gration, and vendor support as barriers to adoption at scale. As the operational consequences of con-solidation have demonstrated, efficiencies seized without consideration of potential service blowback may leave the business less prepared to navigate vol-atile economic conditions.
Conclusion
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THE VISION FOR INFRASTRUCTURE: A QUESTION OF MANAGEMENT
The point is one that should not be lost on the vendor community: IT infrastructure organizations may not be poised for radical technology change in the near term, but the fault for that may be less in the technologies themselves than in vendors’ ability to connect them to clear business solutions. The postrecession enterprise is likely to be characterized by a far different mix of people, processes, and tech-nologies than in years past. Emerging infrastructure technologies cannot be single-point, technology-only solutions but must assert a role in defining the entire mix if they are to see mainstream adoption.
The endstate vision of what the postrecession enter-prise is likely to demand—cost-effective, responsive, and geographically unbounded IT infrastructure—is clear. The management path to arrive at this endstate is not. The mandate for today’s infra-structure executive is not that of the technologist, but that of the strategist and business leader, one who can sense business opportunity first and map solutions that leaven supply-side efficiency with demand-side need.
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EMERGING TRENDS IN IT INFRASTRUCTURE 16
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16
This is a critical juncture in the history of our function. I would
like to better understand the balance of risk and opportunities
associated with impending changes. There is no better place to
get that information than from my peers.
Director IT Operations and Services
Technology Company
“
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EMERGING TRENDS IN IT INFRASTRUCTURE 17
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Notes and Sources
NOTES1 Page 4: “A special report on entrepreneurship,” from the 14–20 March print edition of
The Economist.
2 Page 6: The Vision for Infrastructure Working Group refers to cloud computing in this context as infrastructure-as-a-service (IaaS), or “bare metal.” For a full taxonomy of def-initions, see the Infrastructure Executive Council’s Emerging Technology Brief: Cloud Computing.
3 Page 6: For a project-based view of the risks and benefits of cloud computing, see the Infrastructure Executive Council’s Cloud Computing Migration Scorecard.
SOURCE � Infrastructure Executive Council research.
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