How software-defined storage translates into just-in-time data center scaling and hybrid IT benefits

The next BriefingsDirect Voice of the Customer case study examines how hosting provider Opus Interactive adopted a software-defined storage approach to better support its thousands of customers.

We'll learn how scaling of customized IT infrastructure for a hosting organization in a multi-tenant environment benefits from flexibility of modern storage, unified management, and elastic hardware licensing. The result is gaining the confidence that storage supply will always meet dynamic hybrid computing demand -- even in cutting-edge hosting environments.

Listen to the podcast. Find it on iTunes. Get the mobile app. Read a full transcript or download a copy.

To describe how massive storage and data-center infrastructure needs can be met in a just-in-time manner, we're joined by Eric Hulbert, CEO at Opus Interactive in Portland, Oregon. The discussion is moderated by BriefingsDirect's Dana Gardner, Principal Analyst at Interarbor Solutions.

Here are some excerpts:

Gardner: What were the major drivers when you decided to re-evaluate your storage, and what were the major requirements that you had?

Hulbert: Our biggest requirement was high-availability in multi-tenancy. That was number one, because we're service providers and we have to meet the needs of a lot of customers, not just a single enterprise or even enterprises with multiple business groups.

Hulbert

So we were looking for something that met those requirements. Cost was a concern as well. We wanted it to be affordable, but needed it to be enterprise-grade with all the appropriate feature sets -- but most importantly it would be the scale-out architecture.

We were tired of the monolithic controller-bound SANs, where we'd have to buy a specific bigger size. We'd start to get close to where the boundary would be and then we would have to do a lift-and-shift upgrade, which is not easy to do with almost a thousand customers.

Ultimately, we made the choice to go to one of the first software-defined storage architectures, which is a company called LeftHand Networks, later acquired by Hewlett Packard Enterprise (HPE), and then some 3PAR equipment, also acquired by HPE. Those were, by far, the biggest factors while we made that selection on our storage platform.

Gardner: Give us a sense of the scale-out requirements.

Hulbert: We have three primary data centers in the Pacific Northwest and one in Dallas, Texas. We also have the ability for a little bit of space in New York, for some of our East Coast customers, and one in San Jose, California. So, we have five data centers in total.

Gardner: Is there a typical customer, or a wide range of customers?

Big range

Hulbert: We have a pretty big range. Our typical customers are in finance and travel and tourism, and the hospitality industries. There are quite a few in there. Healthcare is a growing vertical for us as well.

Then, we rounded out with manufacturing and little bit of retail. One of our actual verticals, if you could call it vertical, are the MSPs and IT companies, and even some VARs, that are moving into the cloud.

We enable them to do their managed services and be the "boots on the ground" for their customers. That spreads us into the tens of thousands of customers, because we have about 30 to 25 MSPs that work with us throughout the country, using our infrastructure. We just provide the infrastructure as a service, and that's been a pretty growing vertical for us.

Software Defined Storage
Eliminate Complexity and Free Infrastructure
From the Limitations of Dedicated Hardware

Gardner: And then, across that ecosystem, you're doing colocation, cloud hosting, managed services? What's the mix? What’s the largest part of the pie chart in terms of the services you're providing in the market?

Hulbert: We're about 75 percent cloud hosting, specifically a VMware-based private cloud, a multi-tenant private cloud. It's considered public cloud, but we call it private cloud.

We do a lot of hybrid cloud, where we have customers that are doing bursting into Amazon or [Microsoft] Azure. So, we have the ability to get them either Direct Connect Amazon connections or Azure ExpressRoute connections into any of our data centers. Then, 20 percent is colocation and about 5 percent for back-up, and disaster recovery (DR) rounds that out.

Gardner: Everyone, it seems, is concerned about digital disruption these days. For you, disruption is probably about not being able to meet demand. You're in a tight business, a competitive business. What’s the way that you're looking at this disruption in terms of your major needs as a business? What are your threats? What keeps you up at night?

Still redundant

Hulbert: Early on, we wanted a concurrently maintainable infrastructure, which also follows through with the data centers that we're at. So, we needed Tier 3-plus facilities that are concurrently maintainable. We wanted the infrastructure be the same. We're not kept up at night, because we can take an entire section of our solution offline for maintenance. It could be a failure, but we're still redundant.

It's a little bit more expensive, but we're not trying to compete with the commodity hosting providers out there. We're very customized. We're looking for customers that need more of that high-touch level of service, and so we architect these big solutions for them -- and we host with a 100 percent up-time.

The infrastructure piece is scalable with scale-out architecture on the storage side. We use only HP blades, so that we just keep stacking in blades as we go. We try to stay a couple of blade chassis ahead, so that we can take pretty large bursts of that infrastructure as needed.

That's the architecture that I would recommend for other service providers looking for a way to make sure they can scale out and not have to do any lift-and-shift on their SAN, or even the stack and rack services, which take more time.

We have to cable all of them versus needing to do one-blade chassis. Then, you can just slot in 16 blades quickly, as you're scaling. That allows you to scale quite a bit faster.

We use only HP blades, so that we just keep stacking in blades as we go. We try to stay a couple blade chassis ahead, so that we can take pretty large bursts of that infrastructure as needed.

Gardner: When it comes to making the choice for software-defined, what has that gotten you? I know people are thinking about that in many cases -- not just service providers, but enterprises. What did service-defined storage get for you, and are you furthering your software-defined architecture to more parts of your infrastructure?

Hulbert: We wanted it to be software-defined because we have multiple locations and we wanted one pane of glass. We use HPE OneView to manage that, and it would be very similar for an enterprises. Say we have 30 remote offices, they want to put the equipment there, and the business units need to provision some service and storage. We want to be going to each individual appliance or chassis or application in one place to provision it all.

Since we're dealing now with nearly a thousand customers -- and thousands and thousands of virtual servers, storage nodes, and all of that, the chunklets of data are distributed across all these. Being able to do that from one single pane of the glass from a management standpoint is quite important for us.

So, it's that software-defined aspect, especially distributing the data into chunklets, which allows us to grow quicker, and putting a lot of  automation on the back-end.

We only have 11 system administrators and engineers on our team managing that many servers, which shows you that our density is pretty high. That only works well if we have really good management tools, and having it software-defined means fewer people walking to and from the data center.

Even though our data centers are manned facilities, our infrastructure is basically lights out. We do everything from remote terminals.

Gardner: And does this software-defined extend across networking as well? Are you hyper-converged, converged? How would you define where you're going or where you'd like to go?

Converged infrastructure

Hulbert: We're not hyper-converged. For our scale, we can’t get into the prepackaged hyper-converged product. For us, it would be more of a converged infrastructure approach.

As I said, we do use the c-Class blade chassis with Virtual Connect, which is software-defined networking. We do a lot of VLANs and things like that on the software side.

We till have some outside of that out of band, networking, the network stacks, because we're not just a cloud provider. We also do colocation and a lot of hybrid computing where people are connecting between them. So, we have to worry about Fibre Channel on iSCSI and connections in SAN.

That adds a couple of other layers that are a few extra management steps, but in our scale, it’s not like we're adding tens of thousands of servers a day or even an hour, as I'm sure Amazon has to. So we can take that one small hit to pull that portion of the networking out, and it works pretty good for us.

Software Defined Storage
Eliminate Complexity and Free Infrastructure
From the Limitations of Dedicated Hardware

Gardner: How do you see the evolution of your business in terms of moving past disruption, adopting these newer architectures? Are there types of services, for example, that you're going to be able to offer soon or in the foreseeable future, based on what you're hearing from some of the vendors?

Hulbert: Absolutely. One of the first ones I mentioned earlier was the ability for customers that want to burst into public cloud to be able to do the Amazon Direct Connects. Even with the telecom providers back on, you're looking at 15 to 25 milliseconds latency. For some of these applications, that’s just too much latency. So, it’s not going to work.

Now, with the most recent announcement from Amazon, they put a physical Direct Connect node in Oregon, about a mile from our data-center facility. It's from EdgeConneX, who we partnered with.

Now, we can offer the lowest latency for both Amazon and Azure ExpressRoute in the Pacific Northwest, specifically in Oregon. That’s really huge for our customers, because we have some that do a lot of public-cloud bursting on bold platforms. So that’s one new offering we are doing.

Disruption, as we've heard, is around containers. We're launching a new container-as-a-service platform later this year based on ContainerX. That will allow us to do containers for both Windows or Starnix platforms, regardless of what the developers are looking for.

We're targeting developers, DevOps guys, who are looking to do microservices to take their application, old or new, and architect it into the containers. That’s going to be a very disruptive new offering. We've been working on a platform for a while now because we have multiple locations and we can do the geographic dispersion for that.

I think it’s going to take a little bit of the VMware market share over time. We're primarily a VMware shop, but I don’t think it’s going to be too much of an impact to us. It's another vertical we're going to be going after. Those are probably the two most important things we see as big disruptive factors for us.

Hybrid computing

Gardner: As an organization that's been deep into hybrid cloud and hybrid computing, is there anything out there in terms of the enterprises that you think they should better understand? Are there any sort of misconceptions about hybrid computing that you detect in the corporate space that you would like to set them straight on?

Hulbert: The hybrid that people typically hear about is more like having on-premises equipment. Let’s say I'm a credit union and I’ve got one of the bank branches that we decided to put three or four cabinets of our equipment and one on the vaults. Maybe they've added one UPS and one generator, but it’s not to the enterprise level, and they're bursting to the public cloud for the things that makes sense to meet their security requirements.

To me, that’s not really the best use of hybrid IT. Hybrid IT is where you're putting what used to be on-premises in an actual enterprise-level, Tier 3 or higher data center. Then, you're using either a form of bursting into private dedicated cloud from a provider in one of those data centers or into the public cloud, which is the most common definition of that hybrid cloud. That’s what I would typically define as hybrid cloud and hybrid IT.

Gardner: What I'm hearing is that you should get out of your own data center, use somebody else's, and then take advantage of the proximity in that data center, the other cloud services that you can avail yourself of.

Then, you're using either a form of bursting into private dedicated cloud from a provider in one of those data centers or into the public cloud which is the most common definition of that hybrid cloud.

Hulbert: Absolutely. The biggest benefit to them is at their individual location or bank branches. This the scenario where we use the credit union. They're going to have maybe one or two telco providers, and they're going to be their 100 or maybe 200 Mb-per-second circuits.

They're paying a pretty premium for them, and now when they get into one of these data centers, they're going to have the ability to have 10-gig or even 40- or 100-gig connected internet pipes with a lot higher headroom for connectivity at a better price point. 

On top of that, they'll have 10-gig connection options into the cloud, all the different cloud providers. Maybe they have an Oracle stack that they want to put on an Oracle cloud some day along with their own on- premises. The hybrid things get more challenging, because now, they're not going to get the connectivity they need. Maybe they want to be into the software, they want to do an Amazon or Azure, or maybe they want a Opus cloud.

They need faster connectivity for that, but they have equipment that still has usable life. Why not move that to an enterprise-grade data center and not worry about air conditioning challenges, electrical problems, or whether it’s secure.

All of these facilities, including ours, have every checkbox for compliance and auditing that happens on an annual basis. Those things that used to be really headaches aren’t core of their business. They don’t do those any more. Focus on what's core, focus on the application and their customers.

Gardner: So proximity still counts, and probably will count for an awfully long time. You get benefits from taking advantage of proximity in these data centers, but you can still have, as you say, what you consider core under your control, under your tutelage and set up your requirements appropriately?

Mature model

Hulbert: It really comes down to the fact that the cloud model is very mature at this point. We’ve been doing it for over a decade. We started doing cloud before it was even called cloud. It was just virtualization. We launched our platform in late 2005 and it proved out, time and time again, with 100 percent up-time.

We have one example of a large customer, a travel and tourism operator, that brings visitors from outside the US to the US. They do over a $1 billion a year in revenue, and we host their entire infrastructure.

It's a lot of infrastructure and it’s a very mature model. We've been doing it for a long time, and that helps them to not worry about what used to be on-premises for them. They moved it all. A portion of it is colocated, and the rest is all on our private cloud. They can just focus on the application, all the transactions, and ultimately on making their customers happy.

Gardner: Going back to the storage equation, Eric, do you have any examples of where the storage software-defined environment gave you the opportunity to satisfy customers or price points, either business or technical metrics that demonstrate how this new approach to storage particularly fills out this costs equation?

The ability to easily provision the different sized data storage we need for the virtual servers that are running on that is absolutely paramount.

Hulbert: In terms of the software-defined storage, the ability to easily provision the different sized data storage we need for the virtual servers that are running on that is absolutely paramount.

We need super-quick provisioning, so we can move things around. When you add in the layers of VMware, like storage vMotion, we can replicate volumes between data centers. Having that software-defined makes that very easy for us, especially with the built-in redundancy that we have and not being controller-bound like we mentioned earlier on.

Those are pretty key attributes, but on top of that , as customers are growing, we can very easily add more volumes for them. Say they have a footprint in our Portland facility and want to add a footprint in our Dallas, Texas facility and do geographic load balancing. It makes it very easy for us to do the applications between the two facilities, slowly adding on those layers as customers need to grow. It makes that easy for them as well.

Software Defined Storage
Eliminate Complexity and Free Infrastructure
From the Limitations of Dedicated Hardware

Gardner: One last question, what comes next in terms of containers? What we're seeing is that containers have a lot to do with developers and DevOps, but ultimately I'd  think that the envelope gets pushed out into production, especially when you hear about things like composable infrastructure. If you've been composing infrastructure in the earlier part of the process and development, it takes care of itself in production.

Do you actually see more of these trends accomplishing that where production is lights-out like you are, where more of the definition of infrastructure and applications, productivity, and capabilities is in that development in DevOps stage?

Virtualization

Hulbert: Definitely. Over time, it is going to be very similar to what we saw when customers were moving from dedicated physical equipment into the cloud, which is really virtualization.

This is the next evolution, where we're moving into containers. At the end of the day, the developers, the product managers for the applications for whatever they're actually developing, don't really care what and how it all works. They just want it to work.

They want it to be a utility consumption-based model. They want the composable infrastructure. They want to be able to get all their microservices deployed at all these different locations on the edge, to be close to their customers.

Containers are going to be a great way to do that because they have all the overhead of dealing with the operations knowledge. So, they can just put these little APIs and the different things that they need where they need it. As we see more of that stuff pushed to the edge to get the eyeball traffic, that’s going to be a great way to do that. With the ability to do even further bursting and into the bigger public clouds worldwide, I think we can get to a really large scale in a great way.

Listen to the podcast. Find it on iTunes. Get the mobile app. Read a full transcript or download a copy. Sponsor: Hewlett Packard Enterprise.

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How IT innovators turn digital disruption into a business productivity force multiplier

The next BriefingsDirect business innovation thought leadership panel discussion examines how digital business transformation has been accomplished by several prominent enterprises. We'll explore how the convergence of cloud, mobility, and big-data analytics has prompted companies to innovate and produce new levels of award-winning productivity.

Listen to the podcast. Find it on iTunes. Get the mobile app. Read a full transcript or download a copy.

To learn how these trend-setters create innovation value, we're joined by some finalists from the Citrix Synergy 2016 Innovation Awards Program: Olaf Romer, Head of Corporate IT and group CIO at Bâloise in Basel, Switzerland; Alan Crawford, CIO of Action for Children in London, and Craig Patterson, CEO of Patterson and Associates in San Antonio, Texas. The discussion is moderated by me, Dana Gardner, Principal Analyst at Interarbor Solutions.

Here are some excerpts:

Gardner: Olaf, what are the major trends that drove you to reexamine the workplace conceptually, and how did you arrive at your technology direction for innovating in that regard?

Romer: First of all, we're Swiss traditional insurance. So, our driver was to become a little bit more modern to get the new generation of people in our company. In Switzerland, this is s a little bit of problem. We also have big companies in Zurich, for example. So, it’s very important for us.

Romer

We did this in two directions. One direction is on the IT side, and the other direction is on the real-estate side. We changed from the traditional office boxes to a flex office with open space, like Google has. Nobody has their own desk, not even me. We can go anywhere in our office and sit with whom we think it’s necessary. This is also on the IT side. We go in this direction to go for more mobility, an easier way to work in our company.

Gardner: And because you’re an insurance organization, you have a borderless type of enterprise, where you need to interact with field offices, other payers, suppliers, and customers, of course.

Was that ability to deal with many different types of end-point environments also a concern, and how did you solve that?

Romer: The first step was inside our company, and now, we want to go outside to our brokers and to our customers. The security aspect is very, very important. We're still working on being absolutely secure, because we're handling sensitive customer data. We're still in the process of opening our ecosystem outward to the brokers and customers, but also to other companies we work with. [See related post, Expert panel explores the new reality for cloud security and trusted mobile apps delivery.]

Gardner: Alan, tell us about Action for Children and what you’ve been doing in terms of increasing the mobile style of interactions in business.

Crawford: Action for Children is a UK charity. It helps 300,000 children, families, and young people every year. About 5,000 staff, operate from between 300 and 500 branches. So, 300 are our own and a couple of hundred locations are with our partner agencies.

Crawford

When I started there, the big driver was around security and mobility. A lot of the XP computers were running out of support, and the staff outside the office was working on paper.

There was a great opportunity in giving modern tablets to staff to improve the productivity. Productivity in our case means that if you spend less time doing unnecessary visits or do something in one visit instead of three, you can spend more quality time with the family to improve the outcomes for the children.

Gardner: And, of course, as a non-profit organization, costs are always a concern. We’ve heard an awful lot here at Citrix Synergy about lower cost client and endpoint devices. Has that been a good news to your ears? [Learn more about Citrix Synergy 2016.]

Productivity improvements

Crawford: It has. We started with security and productivity as being the main drivers, but actually, as we’ve rolled out, we’ve seen those productivity improvements arise. Now, we're looking at the cost, about the savings we can make on travel, print, and stationery. Our starting budget this year is £1.3 million ($1.7 million) less than it was the year before we introduced tablets for those things. We're trying to work out exactly how much of that we can attribute to the mobile technology and how much of that is due to other factors.

Gardner: Craig, you're working with a number of public sector organizations. Tell us about what they are facing and what mobility as a style of work means to them.

Patterson: Absolutely. I'm working with a lot of public housing authorities. One is Lucas Metropolitan, and other is Hampton Redevelopment Agency. What they're facing is declining budgets and a need to do more with less.

Patterson

When we look at traditional housing-authority and government-service agencies that are paper-based, paper just continues to multiply. You put one piece in the copier and 20 pieces come out. So, being able to take the documents that contain secure private information of our clients and connect those with the clients out in the field is why we need mobility and efficiency and workflows.

And the cloud is what came to mind with that. With content management, we can capture data out in the field. We can move our staff out in the field. We don’t have to bring all of the clients into the office, which can sometimes pose a hardship, especially for elderly, disabled, and many of those in the greatest need. Mobility and efficiency with the cloud and the security have become paramount in how we perform our business.

Gardner: I suppose another aspect of mobility is the ability to bring data in analytics to the very edge. Have you yet to take advantage of that or do you see that it’s something that you’re going to be working toward?

Patterson: We know that it’s something we're working toward. We know from the analytics that we’ve been able to see so far that mobility is the key. For some time, people have thought that we can’t put online things like applications for affordable housing, because people don’t have access to the Internet.

Our analytics prove that entirely wrong. Age groups of 75 and 80 were accessing it on mobile devices faster than the younger group was. What it means is that they find a relative, a grandchild or whoever they need that allows them to access the Internet. It’s been our mindset that has kept us from making the internet and those mobility avenues into our systems available on a broader scale. So, we're moving in that direction so that self service to that community can be displayed more in a broader context.

Measuring outcomes

Crawford: On the analytics and how that’s helped by the mobile working, we had a very similar result in Action for Children in the same year we brought out tablets. We started to do outcome measures with the children we were with. To reach a child, we do a baseline measure when we first meet the family, and then maybe three months later, whatever the period of the intervention, we do a further measure.

Doing that directly on a tablet with the family present has really enhanced the outcome measures. We now have measures on 50,000 children and we can aggregate that, see what the trends are, see what the patterns are geographically by types of service and types of intervention.

Gardner: So it’s that two-way street; the more data and analytics you can bring down to the edge, the more you can actually capture and reapply, and that creates a virtuous cycle of improvement in productivity.

Crawford: Absolutely. In this case, we're looking at the data and learning lessons about what works better to improve the outcomes for disadvantaged children, which is really what we're about.

Gardner: Olaf, user experience is a big topic these days, and insurance, going right to the very edge of where there might be a settlement event of some sort, back to the broker, back to the enterprise. User experience improvements at every step of that means ultimately a better productive outcome for your end-customers. [See related post, How the Citrix Technology Professionals Program produces user experience benefits from greater ecosystem collaboration.]

How does user experience factor into this mobility and data in an analytics equation?

We're looking at the data and learning lessons about what works better to improve the outcomes for disadvantaged children, which is really what we're about.

Romer: First of all, the insurance business is a little bit different business than the others here. The problem is that our customers normally don’t want to touch us during the year. They get a one-time invoice from us and they have to pay the premium. Then, they hope, and we also hope, that they will not have a claim.

We have only one touch a year, and this is little bit of problem. We try to do everything to be more attractive for the customer to get them to us, so that for them it’s clear if they have a problem or need a new insurance, they go to Bâloise Insurance.

We're working on it to bring a little bit of consumerization. In former years the insurance business was very difficult and it wasn’t transparent. The customers have to answer 67 questions before they can take out insurance with us, and this is the point. To make it as simple as possible and to work with a new technology, we have to be attractive for the customers, like taking out insurance through an iPhone. That’s not so easy.

If you talk with a core insurance guy to calculate the premiums, they won’t already have the 67 answers from the customers.  So, it's not only the technology, but working a little bit in a differently in the insurance business. The technology will also help us there. For me, the buzzword is big data, and now we have to bring out the value of the data we have in our business, so that we can go directly with the right user interface to the right customer area.

Gardner: Another concept that we have heard quite a bit at Synergy is the need to allow IT to say yes more often. Starting with you Craig, what are you seeing in the trends and in the technology that is perhaps most impactful for you to be able to say yes to the requests and the need for agility in these businesses, in these public sector organizations?

Device agnosticism

Patterson: It’s the device agnosticism, where you bring your own device (BYOD). It’s a device that the individuals are already familiar with. I'm going to take it from two angles. It could be the employee that’s delivering a service out to a customer in the field that can bring their own device, or a partner or contractor, so that we can integrate and shrink-wrap certain data. We will still have data security while they're deploying or doing something out in the field for us. It could be inspections, customer service, medical, etc.

But then, on the client end, they have their own device. By our being able to deliver products through portals that don’t care what device they have, it’s based on mobile protocols and security. Those are the types of trends that are going to allow us to collect the big analytics, know what we think we know, and find out whether we really know it or not and find it, get the facts for it.

The other piece of it though is to make it easy to access the services that we provide to the community, because now it’s a digital community; it’s not just the hardcore community. To see people in a waiting line now for applications hurts my feelings. We want to see them online, accessing it 24×7, when it makes sense for them. Those are the types of services that I see becoming the greater trends in our industry.

Those are the types of trends that are going to allow us to collect the big analytics, know what we think we know, and find out whether we really know it or not and find it, get the facts for it.

Gardner: Alan, what allows you to say “yes” more often?

Crawford: When I started with the XP laptops, we were saying no. So doing lot of comparisons in program within our center now, they're using the tablets and the technology. You have closed Facebook groups with those families. There's now peer support outside hours, when children are going to bed, which is often when they have issues in a family.

They use Eventbrite, the booking app. There are some standard off-the-shelf apps, but the real enterprise in our service in a rural community currently tells everybody in that community what services they're running through posters and flyers that were printed off. That moved to developing our own app. The prototypes are already out there, and the full app will be out there in a few weeks time. We're saying yes to all of those things. We want to support them. It is not just yes, but yes and how can we help you do that.

Gardner: Olaf, of course, productivity is only as good as the metrics that we need to convince the higher-ups in the board room that we need more investment or that we're doing good work with our technology. Do you have any measurements, metrics, even anecdotes about how you measure productivity and what you've done to modernize your workspaces?

Romer: Yes, for us it’s the feedback from the people. It’s very difficult to measure it on a clear technology level, but feedback from the people is very good and very important for us. You can see  with the BYOD we introduced one and a half years ago, a stronger cultural change in collaboration. We work together much more efficiently in the company and in the different departments.

In former times, we had closed file shares, and I couldn't see the files of the department next to me. Now, we're working completely in a modern collaboration way. Still, on traditional insurances, let’s say with the government, it’s very hard for them to work in the new style..

In the beginning, there were very strong concerns about that, and now we're in a cultural shift on this. We get a lot of good feedback that in project teams, or in the case of some problems or issues, we can work much better and faster together.

Metrics of success

Gardner: Craig, of course it’s great to say yes to your constituents, but it’s also good to say that we're doing more with less to your higher-ups and those that control the budget. Any metrics of success that you can recall in some of the public-sector organizations you're working with?

Patterson: Absolutely. I'll talk about files in workflow. When a document comes into the organization before, we mapped how much time and money it took to get it in a file folder, having been viewed by everyone that it needs to get viewed by. To give quick context, before, a document took a file folder, a label maker, copy machine, and every time a person needed to put a document in that folder, someone had to get it there. Now, the term "file clerk" is actually becoming obsolete.

When a document come in, it gets scanned, it’s instantaneously put in the correct order in the right electronic folder, and an electronic notification is sent to the person who needs to know. That happens in seconds. When you look at each month, it amounts to savings; before, we were managing files, rather than assisting people.

We can now see how many file folders you looked at, how many documents you actually touched, read, and reviewed in comparison with somebody else.

The metrics are in the neighborhood of just about 75 percent paper reduction, because people aren’t making copies. This means they're not going to the copy machine and along the way, the water-cooler and conversation pits. That also abates some of the efficiencies. We can now see how many file folders you looked at, how many documents you actually touched, read, and reviewed in comparison with somebody else.

We had as many as five documents, in comparison with 1,700 in a month. That starts to tell you some things about where your workload is shifting. Not everyone likes that. They might consider it a little bit "big brother," but we need those analytics to know how best to change our workflows to serve our customer, and that’s the community.

Gardner: I don’t know if this is a metric that’s easy to measure, but less bureaucracy would be something that I think just about everyone would be in favor of. Can you point to something that says we're able to reduce bureaucracy through technology?

Patterson: When you look at bureaucracy and unnecessary paper flows, there are certain yes-and-no questions that are part of bureaucracy. Somebody has it go their desk and their job is to stamp yes or no on it. What decision do you have to make? Well they really don’t; they just have to stamp yes. To me, that’s classic bureaucracy.

Well, if the document hits that person’s desk and it meets a certain criteria or threshold, the computer automatically and instantaneously approves it and it has a documented audit trail. That saves some of our clients in the housing-authority industry, when the auditors come and review things. But if you had to make a decision, it forced you to know how long it took you to make it. So, we can look at why is it taking so long or there are questions that you don’t need to be answering.

Gardner: So let the systems do what they do best and let the people do the exception management and the value-added activities. Alan, you had some thoughts about metrics of success of bureaucracy or both?

Proxy measure

Crawford: Yes, it’s the metrics. The Citrix CEO [Kirill Tatarinov] talked at Citrix Synergy about productivity actually going down in the last few years. We’ve put all these tablets out there and we have individual case studies where we know a particular family-support worker has driven 1,700 miles in the year with the tablet, and it was 3,400 miles in the year without. That’s a proxy measure of how much time they're spending on the road, and we have all the associated cost of fuel and wasted time and effort.

We've just installed an app -- actually I have rolled it out in the last month or so -- that measures how many tablets have been switched on in the month, how much they're been used in the day, and what they've been used for. We can break that down by the geographical areas and give that information back to the line managers, because they're the people to whom it will actually make sense.

I'm right at a stage where it’s great information. It’s really powerful, but it’s actually to understand how many hours a day they should be using that tablet. We're not quite sure, and it probably varies from one type of service to another.

We look at those trends over a period of months. We can tell managers that, yes, total staff used them 90 percent, but it’s 85 percent in yours. All managers, I find, are fairly competitive.

There are inhibitors around mobile network coverage and even broadband coverage in some rural areas. We just follow up on all of those user experience information we get back and try and proactively improve them.

Gardner: Well, that may be a hallmark of business agility, when you can try things out, A/B testing. We’ll try this, we’ll try that, we don’t pay a penalty for doing that. We can simply learn from it and immediately apply our lesson back to the process.

Crawford: It’s all about how we support those areas where we identify that they're not making the most of the technology they’ve been given. And it might be human factors. The staff or even the managers are very fearful. Or it might be technical factors. There are inhibitors around mobile network coverage and even broadband coverage in some rural areas. We just follow up on all of those user experience information we get back and try and proactively improve them.

Gardner: Olaf, when we ask enterprises where they are in their digital transformation, many are saying they're just at the beginning. For you, who are obviously well into a digital transformation process, what lessons learned could you share; any words of advice for others as they embark on this journey?

Romer: The first digital transformation in the insurance business was in the middle of 1990s, when we started to go paperless and work with a digital system. Today, more than 90 percent of our new insurance contracts are completely paperless. In Germany, for example, you can give a digital signature. It’s not allowed for the moment in Switzerland, but from a technical perspective, we can do this.

My advice would be that digitalization gives you a good situation to think about to make it simple. We built up great complexity over the years, and now we're able to bring this down and make it as simple as possible. We created the slogan, “Simply Safe,” for us to rethink everything that we're doing to make it simple and safe. Again, for insurance, it's very important that the digitalization brings us not more complexity, but reduces it.

Gardner: Craig, digital transformation, lessons learned, what advice can you offer others as they embark?

Document and workflow

Patterson: In digital transformation, I’ll just use document and workflow. Start with the higher-end items; there's low-hanging fruit there. I don’t know if we'll ever be totally paperless, which would really allow us to go mobile, but at the same time, know what not to scan. Know what to archive and just get rid off. And don't hang on to old technologies for too long. That’s something else that’s starting to happen. The technological revolution in lifecycle of technology is shorter and we need to plan our strategies along those lines.

Gardner: Alan, words of advice on those also interested in digital transformation?

Crawford: For us, it started about connecting with our cause. We’ve got social care staff and since we’re going to do digital transformation, it's not going to really enthuse them. However, if you explain that this is about actually improving the lives of children with technology, then they start to get interested. So, there is a bit about using your cause and relating the change to your cause.

You’ve got to follow through on all this change to get the real benefits out of it. You’ve got to be a bit tenacious with it to really see the benefits in the end.

A lot of our people factors are on how to engage and train. It's no longer IT saying, "Here’s the solution, and we expect you to do ABC." I was working with those social-care workers, and here are the options, what will work for you and how should we approach that, but then it’s never letting up.

Actually, you’ve got to follow through on all this change to get the real benefits out of it. You’ve got to be a bit tenacious with it to really see the benefits in the end.

Gardner: Tie your digital transformation and the organization’s mission that there is no daylight between them.

Crawford: We’ve got the project digitally enabling Action for Children and that was to try and link the two together inextricably.

Listen to the podcast. Find it on iTunes. Get the mobile app. Read a full transcript or download a copy. Sponsor: Citrix.

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Infrastructure as destiny — How Purdue builds an IT support fabric for big data-enabled IoT

The next BriefingsDirect Voice of the Customer IT infrastructure thought leadership case study explores how Purdue University has created a strategic IT environment to support dynamic workload requirements.

We'll now hear how Purdue extended a research and development IT support infrastructure to provide a common and "operational credibility" approach to support myriad types of compute demands by end users and departments.

Listen to the podcast. Find it on iTunes. Get the mobile app. Read a full transcript or download a copy.

To describe how a public university is moving toward IT as a service, please join Gerry McCartney, Chief Information Officer at Purdue University in Indiana. The discussion is moderated by BriefingsDirect's Dana Gardner, Principal Analyst at Interarbor Solutions.

Here are some excerpts:

Gardner: When you're in the business of IT infrastructure, you need to predict the future. How do you close the gap between what you think will be demanded of your infrastructure in a few years and what you need to put in place now?

McCartney: A lot of the job that we do is based on trust and people believing that we can be responsive to situations. The most effective way to show that right now is to respond to people’s issues today. If you can do that effectively, then you can present a case that you can take a forward-looking perspective and satisfy what you and they anticipate to be their needs.

McCartney

I don’t think you can make forward-looking statements credibly, especially to a somewhat cynical group of users, if you're not able to satisfy today’s needs. We refer to that as operational credibility. I don’t like the term operational excellence, but are you credible in what you provide? Do people believe you when you speak?

Gardner: We hear an awful lot about digital disruption in other industries. We see big examples of it in taxi cabs, for example, or hospitality. Is there digital disruption going on at university campuses as well, and how would you describe that?

McCartney: A university you can think of as consisting of three main lines of business, two of which are our core activities, of teaching students, educating students; and then producing new knowledge or doing research. The third is the business of running that business, and how do you do that. A very large infrastructure is built up around that third leg, for a variety of reasons.

But if we look at the first two, research in particular, which is where we started, this concept of the third leg of science has been around for some time now. It used to be just experimentation and theory creations. You create a theory, then you do an experiment with some test tubes or something like this, or grow a crop in the field. Then, you would refine your theory and you would continue in that kind of dyadic mode of just going backward and forward.

Third leg of science

That was all right until we wanted to crash lorries into walls or to fly a probe into the sun. You don’t get to do that a thousand times, because you can’t afford it, or it’s too big or too small. Simulation has now become what we refer to as the third leg of science.

Slightly more than 35 percent of our actual research now uses high-performance computing (HPC) in some key parts of it to produce results, then shape the theory formulation, and the actual experimentation, which obviously still goes on.

Around teaching, we've seen for-profit universities, and we've seen massive open online courses (MOOCs) more recently. There's a strong sense that the current mode of instructional delivery cannot stay the same as it has been for the last hundreds of years and that it’s ripe for reform.

Indeed, my boss at Purdue, Mitch Daniels, would be a clear and vibrant voice in that debate himself. To go back to my earlier comments, our job there is to be able to provide credible alternatives, credible solutions to ideas as they emerge. We still haven’t figured that out collectively as an industry, but that’s something that is in the forefront of a lot of peoples’ minds.

Gardner: Suffice to say that information technology will play a major role in that, whatever it is.

McCartney: It’s hard to imagine a solution that isn’t actually completely dependent upon information technology, for at least its delivery, and maybe for more than that.

Right now, our principal requirement is around research computing, because we have to put the storage close to the compute. That's just a requirement of the technology.

Gardner: So, high-performance computing is a bedrock for the simulations needed in modern research. Has that provided you with a good stepping stone toward more cloud-based, distributed computing-based fabric, and ultimately composable infrastructure-based environments?

McCartney: Indeed it has. I can go back maybe seven or eight years at our place, and we had close to 70 data centers on our campus. And by a data center, I mean a room with at least 200-amp supply, and at least 30 tons of additional cooling, not just a room that happens to have some computers in it. I couldn't possibly count how many of them there are now. Those stand-alone data centers are almost all gone now, thanks to our community cluster program, and the long game is that we probably won't have much hardware on our campus at some point a few years from now.

Right now, our principal requirement is around research computing, because we have to put the storage close to the compute. That's just a requirement of the technology.

In fact, many of our administrative services right now are provided by cloud providers. Our users are completely oblivious to that, but we have no on-premises solution at all. We're not doing travel, expense reimbursement and a variety of back-office things on our campus at all.

Gain Data Insights and Business Value
From the Proliferation
Of IoT Connected Devices and Machines

That trend is going to continue, and the forcing function there is that I can't spend enough on security to protect all the assets I have. So, rather than spend even more on security and fail to provide that completely secure environment, it's better to go to somebody who can provide that environment.

Data-compute link

Gardner: What sort of an infrastructure software environment do you think will give you that opportunity to make the right choices when you decide on-prem versus cloud, even for those intensive workloads that require a tight data and compute link?

McCartney: The worry for any CIO is that the only thing I have that's mine is my business data. Anything else -- web services, network services -- I can buy from a vendor. What nobody else can provide me are my actual accounts, if you wish to just choose a business term, but that can be research information, instructional information, or just regular bookkeeping information.

When you come into a room of a new solution, you're immediately looking at the exit door. In other words, when I have to leave, how easy, difficult, or expensive is it going to be to extract my information back from the solution?

That drives a huge part of any consideration, whether it's cloud or on-prem or whether it's proprietary or open code solution. When this product dies, the company goes bust, we lose interest in it, or whatever -- how easy, expensive, difficult is it for me to extract my business data back from that environment, because I am going to need to do that?

I'm quite happy for everybody else to knock the bumps out to the road for me, and I'll be happy to drive along it when it’s a six-lane highway.

Gardner: What, at this juncture, meets that requirement in your mind? We've heard a lot recently about container technology, standards for open-source platforms, industry accepted norms for cloud platforms. What do you think reduces your risk at this point?

McCartney: I don't think it's there yet for me. I'm happy to have, relatively speaking, small lines of business. Also, you're dependent then on your network availability and volume. So, I'm quite happy there, because I wasn't the first, and because that's not an important narrative for us as an institution.

I'm quite happy for everybody else to knock the bumps out of the road for me, and I'll be happy to drive along it when it’s a six-lane highway. Right now it's barely paved, and I'll allow other brave souls to go there ahead of me.

Gardner: You mentioned early on in our discussion the word "cynical." Tell me a little bit about the unique requirements in a university environment where you need to provide a common, centrally managed approach to IT for cost and security and manageability, but also see to the unique concerns and requirements of individual stakeholders?

McCartney: All universities are, as they should be, full of self-consciously very smart people who are all convinced they could do a job, any particular job, better than the incumbent is doing it. Having said that, the vast bulk of them have very little interest in anything to do with infrastructure.

The way this plays out is that the central IT group provides the core base that services the network -- the wireless services, base storage, base compute, things like that. As you move to the edge, the things that make a difference at the edge.

Providing the service

In other words, if you have a unique electrical device that you want to plug in to a socket in the wall because you are in paleontology, cell biology, or organic chemistry, that's fine. You don't need your own electricity generating plants to do that. I can provide you with the electricity. You just need the cute device and you can do your business, and everybody is happy.

Whatever the IT equivalent to that is, I want to be the energy supplier. Then, you have your device at the edge that makes a difference for you. You don't have to worry about the electricity working; it's just there. I go back to that phrase "operational credibility." Are we genuinely surprised when the service doesn’t work? That’s what credibility means.

Gardner: So, to me, that really starts to mean IT as a service, not just electricity or compute or storage. It's really the function of IT. Is that in line with your thinking, and how would you best describe IT as a service?

McCartney: I think that's exactly right, Dana. There are two components to this. There's an operational component, which is, are you a credible provider of whatever the institution decides the services are that it needs, lighting, air-conditioning or the IT equivalence of that? They just work. They work at reasonable cost; it's all good. That’s the operational component.

The difference with IT, as opposed to other infrastructure components, is that IT has itself the capability to transform entire processes. That’s not true of other infrastructure things. I can take an IT process and completely reengineer something that's important to me, using advantages that the technology gives me.

Gain Data Insights and Business Value
From the Proliferation
Of IoT Connected Devices and Machines

For example, I might be concerned about student performance in particular programs. I can use geo-location data about their movement. I can use network activity. I can use a variety of other resources available to me to help in the guidance of those students on what’s good behavior and what’s helpful behavior to an outcome that they want. You can’t do that with an air-conditioning system.

IT has that capability to reinvent itself and reinvent entire processes. You mentioned some of them the way that things like Uber has entirely disrupted the taxi industry. I’d say the same thing here.

There's one part of the CIO’s job that’s operational; does everything work? The second part is, if we're in transition period to a new business model, how involved are the IT leaders in your group in that discussion? It's not just can we do this with IT or not, but it’s more can a CIO and the CIO’s staff bring an imagination to the conversation, that is a different perspective than other voices in the organization? That's true of any industry or line of business.

Are you merely there as a handmaiden waiting to be told what to do, or are you an active partner in the conversation? Are you a business partner? I know that’s a phrase people like to use. There's a kind of a great divide there.

Gardner: I can see where IT is a disruptor -- and it’s also a solution to the disruptor, but that solution might further disrupt things. So, it's really an interesting period. Tell me a little bit more about this concept of student retention using new technologies -- geolocation for example -- as well as big data which has become more available at much lower cost. You might even think of analytics as a service as another component of IT as a service.

How impactful will that be on how you can manage your campus, not only for student retention, but perhaps for other aspects of a smarter intelligent campus opportunity? [See related post, Nottingham Trent University Elevates Big Data’s Role to Improving Student Retention in Higher Education.]

Personalized attention

McCartney: One of the great attractions of small educational institutions is that you get a lot of personalized attention. The constraint of a small institution is that you have very little choice. There's a small number of faculty, and they simply can’t offer the options and different concentrations that you get in a large institution.

In a large institution, you have the exact opposite problem. You have many, many choices, perhaps even too many subjects that, as a 19-year-old, you've never even heard of. Perhaps you get less individualized attention and you fill that gap by taking advice from students who went to your high school a year before, who are people in your residence hall, or people you bump into on the street. The knowledge that you acquire there is accidental, opportunistic, and not structured in any way around you as an individual, but it’s better than nothing.

There are advisors, of course, and there are people, but you don't know these individuals. You have to go and form relationships with them and they have to understand you and you have to understand them.

A big-data opportunity here is to be able to look at the students at some level of individuality. "Look, this is your past, this is what you have done, this is what you think, and this is the behavior that we are not sure you're engaging in right now. Have you thought about this path, have you thought about this kind of behavior for yourself?"

One of the great attractions of small educational institutions is that you get a lot of personalized attention. The constraint of a small institution is that you have very little choice.

A well-established principle in student services is that the best indicator of student success is how engaged they are in the institution. There are many surrogate measures of that, like whether they participate in clubs. Do they go home every weekend, indicating they are not really engaged, that they haven’t made that transition?

Independent of your academic ability, your SAT scores, and your GPA that you got in high school, for students that engage, that behavior is highly correlated with success and good outcomes, the outcomes everybody wants.

As an institution, how do you advise or counsel. They'll say perhaps there's nothing here they're interested in, and that can be a problem with a small institution. It's very intimate. Everybody says, "Dana, we can see you're not having a great time. Would you like to join the chess club or the drafts club?" And you say, "Well, I was looking for the Legion of Doom Club, and you don’t seem to have one here."

Well, you go to a large institution, they probably have two of those things, but how would you find it and how would you even know to look for that? How would you discover new things that you didn't even know you liked, because the high school you went to didn't teach applied engineering or a whole pile of other things, for that matter.

Gardner: It’s interesting when you look at it that way. The student retention equation is, in a business sense, the equivalent of user experience, personalization, engagement, share of wallet, those sorts of metrics.

We have the opportunity now, probably for the first time, to use big data, Internet of Things (IoT), and analytics to measure, predict, and intercede at a behavioral level. So in this case, to make somebody a productive member of society at a capacity they might miss and you only have one or two chances at that, seems like a rather monumental opportunity.

Effective path

McCartney: You’re exactly right, Dana. I'm not sure I like the equivalence with a customer, but I get the point that you're making there. What you're trying to do is to genuinely help students discover an effective path for themselves and learn that. You can learn it randomly, and that's nice. We don't want to create this kind of railroad track. Well, you're here; you’ve got to end up over there. That’s not helpful either.

My own experience, and I don’t know about other people listening to this, is that you have remarkably little information when you're making these choices at 19 and 20. Usually, if you were getting direction, it was from somebody who had a plan for you that was more based on their experience of life, some 20 or 30 years previously than on your experience of life.

Gain Data Insights and Business Value
From the Proliferation
Of IoT Connected Devices and Machines

So where big data can be a very effective play here, was to say, "Look, here are people that look like you, and here were the choices they've made. You might find some of these choices interesting. If you might, then here’s how you’d go about exploring that."

As you rightly say, and implicitly suggested, there is a concern with the high costs, especially of residential education, right now. The most wasteful expenditures there are is where you do a year or two to find out you shouldn't have ever been in this program, you have no love for this thing, you have no affinity for it.

What you're trying to do is to genuinely help students discover an effective path for themselves and learn that. You can learn it randomly, and that's nice.

The sooner you can find that out for yourself and make a conscious choice the better. We see big data having a very active role in that because one of the great advantages of being in a large institution is that we have tens of thousands of students over many years. We know what those outcomes look like, and we know different choices that different people have made. Yes, you can be the first person to make a brand new choice, and good for you if you are.

Gardner: Well it’s an interesting way of looking at big data that has a major societal benefit in the offing. It also provides predictability and tools for people in ways they hadn’t had before. So, I think it’s very commendable.

Before we sign-off, what comes next – high performance computing (HPC), fabric cloud, IT-as-a service -- is there another chapter on this journey that perhaps you have a bead on that that we’re not aware of?

McCartney: Oh my goodness, yes. We have an event now that I started three years ago called "Dawn or Doom," in which if technology is a forcing function, if it is. We're not even going to assert that definitely. Are we reaching a point of a new nirvana, a new human paradise where we’ve resolved all major social problems, and health problems or have we created some new seventh circle of hell where it’s actually an unmitigated disaster for almost everybody; if not everybody? Is this the end of life as we know it? We create robots that are superior to us in every way and we become just some intermediate form of life that has reached the end of its cycle.

This is an annual event that's free and open. Anybody who wants to come is very welcome to attend. You can Google "Dawn or Doom Purdue." We look at it from all different perspectives. So, we have obviously engineers and computer scientists, but we have psychologists, we have labor economists. What about the future of work? If nobody has a job, is that a blessing or a curse?

Psychologists, philosophers, what does it mean, what does artificial intelligence mean, what does a self-conscious machine mean? Currently, of course, we have things like food security we worry about. And the Zika virus -- are we spawning a whole new set of viruses we have no cure for? Have we reached the end of the effectiveness of antibiotics or not?

These are all incredibly interesting questions I would think any intelligent person would want to at least probe around, and we've had some significant success with that.

Next event

Gardner: When is the next Dawn or Doom event, and where will it be?

McCartney: It would be in West Lafayette, Indiana, on October 3 and 4. We have a number of external high-profile key note speakers, then we have a passel of Purdue faculty. So, you will find something that entertain even the most arcane of interests. [For more on Dawn or Doom, see the book, Dawn or Doom: The Risks and Rewards of Emerging Technologies.]

Listen to the podcast. Find it on iTunes. Get the mobile app. Read a full transcript or download a copy. Sponsor: Hewlett Packard Enterprise.

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How UPS automates supply chain management and gains greater insight for procurement efficiency

The next BriefingsDirect business innovation for procurement case study examines how UPS modernizes and streamlinines its procure-to-pay processes.

Learn how UPS -- across billions of dollars of supplier spend per year -- automates supply-chain management and leverages new technologies to provide greater insight into procurement networks. This business process innovation exchange comes to you in conjunction with the Tradeshift Innovation Day held in New York on June 22, 2016.

Listen to the podcast. Find it on iTunes. Get the mobile app. Read a full transcript or download a copy. 

To explore how procurement has become strategic for UPS, BriefingsDirect sat down with Jamie Dawson, Vice-President of UPS's Global Business Services Procurement Strategy in Atlanta. The discussion is moderated by me, Dana Gardner, Principal Analyst at Interarbor Solutions.

Here are some excerpts:

Gardner: What are the major trends that you are seeing in procurement, and how you're changing your strategy to adjust?

Dawson: We're seeing a lot of evolution in the marketplace in terms of both technology and new opportunities in ways to procure goods and that really is true around the globe. We're adjusting our strategy and also challenging some of our business partners to come along with us.

We're a $60 billion company. Last year, our total expenses were somewhere in the $50-billion range, lots of goods and services flowing around the globe.

Gardner: And so, any way that you can find new efficiency, new spend management benefits that turns into some significant savings.

Dawson: Absolutely.

Gardner: Now that you're looking for new strategies and new solutions, what is it in procurement that’s of most interest to you and how are you using technology in ways you didn't before?

Collaboration and partnerships

Dawson: One of the new ways is a combination or partnerships both with third parties as well as our own internal business partners. We're collaborating with other functions, and procurement is not something we are doing to them; we're working with them to understand what their needs are and working with their suppliers as well.

Dawson

Gardner: We're hearing some very interesting things these days about using machine learning and artificial intelligence, combining that with human agents who are specialized. It sounds like, in some ways, external procurement services can do the job better than anyone. Is that something that you're open to? Is procurement as a service something you're looking at? [See related post, How new modes of buying and evaluating goods and services disrupts business procurement — for the better.]


Dawson: Procurement-as-a-service has a certain niche play. There will always be basic buy-and-sell items, even as individuals. There are some things you don’t research, but you just go out and buy. There are other things for which you do a lot of research and you look into different solutions.

There are different things that will cause you to research more. Maybe it's a competitive advantage, maybe you're looking for an opportunity in a new space or a new corner of the globe. So, you'll do a lot more research, and your solutions need to be scalable. If you create and start in Europe, maybe you'll also want to use it in Asia. If you start in the US, maybe you want to use elsewhere.

Gardner: It sure sounds like, during a period of experimentation, that where the boundary was between things that you would buy by rote versus things you would buy with a lot of expertise or research is shifting or changing. Are you experimenting as an organization, and what is interesting to you as you look at new opportunities from those people who are in the procurement network space?

There will always be complex areas that require solution orientation more than just price. They need a deep understanding of industry, knowledge, and partnership.

Dawson: There will always be complex areas that require solution orientation more than just price. They need a deep understanding of industry, knowledge, and partnership. There are a lot of other areas where the opportunities are expanding every day. [See related post, ChainLink analyst on how cloud-enabled supply chain networks drive companies to better manage finances, procurement.]

Gardner: As you think about what you've done and been able to accomplish, do you have any advice for other organizations that are also starting to think about modernizing and strategizing, rather than just doing it in the traditional old way? What would you tell them?

Dawson: Two things. One would be within the procurement organizations to be open to new ideas. And second, get the rest of the organization behind you, because you're going to need their support.

Gardner: It seems that procurement as a function is just far more strategic than it used to be. Not only are you able to get more goods and services, but you can save significant amounts of money. Do you feel that your profile as an organization within UPS is rising or expanding in terms of the role you play in the larger organization? [See related post, CPO expert Joanna Martinez extols the virtues of redesigning procurement for strategic business agility.]


Don't have to sell

Dawson: I'm certainly aware that the knowledge of the capabilities and the demonstrated successes are now being recognized throughout the organization. And it becomes self feeding. You actually get on a roll and can further expand the capabilities once that knowledge is out there; you don’t have to sell.

Gardner: Last question, looking to the future, on a vision level, what’s really exciting to you? What are you thinking that might be more important to you in how you do business two or three years from now? It could be technology, suppliers, ecosystems, cloud enabled intelligence, that sort of thing.

Dawson: It’s a very interesting question, because it’s almost the same answer. Your greatest fear is the greatest benefit. I listened to what we just heard on the Tradeshift Go tool, and it’s crazy how exciting that this is. You heard all the questions in the room about how to adapt that to what you already have today? The world still exists as it exists today.

There's this huge transition period where we were bolting on these fantastic great ideas to our existing infrastructure. That transition into what's new and really embracing it is the most exciting of all.

So, there's this huge transition period where we were bolting on these fantastic great ideas to our existing infrastructure. That transition into what's new and really embracing it is the most exciting of all.

Gardner: Disruption can be good and disruption can be bad.

Dawson: It will be a challenging journey.

Listen to the podcast. Find it on iTunes. Get the mobile app. Read a full transcript or download a copy. Sponsor: Tradeshift.

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