Yes, the world continues to get ”smaller.&quot; And yes, it continues to get “flatter” and more interconnected through forces such as free trade, the Internet and the arrival of globalization. (Transition to the next slide)
The processes of business, government and life—which are ultimately the source of those &quot;surprising&quot; events, moments of widespread shock and global crisis—are not smart enough to be sustainable. We must make them better. The need for progress is clear. CONSIDER THIS FACT: 170 billion Kilowatt-hours wasted each year by consumers due to insufficient power usage information.
The technology and know-how to make these processes and systems better is here. We can make them better. The opportunity for progress is clear. CONSIDER THIS FACT: In the Pacific Northwest National Laboratory Smart Grid project, consumers decreased their overall peak load on the grid by 15% when offered the opportunity to save an average of 10% on their electricity bills.1 Link to PNNL reference: http://w3-01.ibm.com/sales/ssi/cgi-bin/ssialias?infotype=CR&subtype=NA&htmlfid=0GLOS-72NV6X&appname=crmd
The need for progress is clear by examining the impact of congested roadways in the U.S. - 4.2 billion lost hours and 2.9 billion gallons of gas.
The opportunity for progress is clear as demonstrated in Stockholm - 20 percent less traffic, a 12 percent drop in emissions and a reported 40,000 additional daily users of public transportation thanks to a smart tolling system. Link to Swedish National Road Administration reference: http://w3-01.ibm.com/sales/ssi/cgi-bin/ssialias?infotype=CR&subtype=NA&htmlfid=0GLOS-6A9FHE&appname=crmd
The need for progress is clear as evidenced by the 100 million people worldwide pushed below the poverty line by personal healthcare expenditures.
The opportunity for progress in the healthcare arena is clear. University of Pittsburgh Medical Center case study: http://www-304.ibm.com/jct01003c/software/success/cssdb.nsf/CS/JSTS-7HVLTH?OpenDocument&Site=default&cty=en_us
So, yes, the world continues to get flatter. And yes, it continues to get smaller and more interconnected. But something is happening that holds even greater potential. In a word, our planet is becoming smarter. This isn't just a metaphor. And I'm not talking about the Knowledge Economy—or even the fact that hundreds of millions of people from developing nations are gaining the education and skills to enter the global workforce. I mean the infusion of intelligence into the way the world literally works—the systems and processes that enable physical goods to be developed, manufactured, bought and sold… services to be delivered… everything from people and money to oil, water and electrons to move… and billions of people to work and live.
There’s a mandate for positive change among people, businesses, and institutions. And a mandate for change is a mandate for smart.
Something meaningful is happening—the infusion of intelligence into the way the world works.
What all of this means is that the digital and physical infrastructures of the world are converging. Computational power is being put into things we wouldn't recognize as computers. Indeed, almost anything—any person, any object, any process or any service, for any organization, large or small—can become digitally aware and networked. With so much technology and networking abundantly available at such low cost: What wouldn't you put smart technology into? What service wouldn't you provide a customer, citizen, student or patient? What wouldn't you connect? What information wouldn't you mine for insight? A smarter planet is possible because - Our world is becoming instrumented Our world is becoming interconnected . Virtually all things, processes, and ways of working are becoming intelligent . Let me explain each to you in a bit more detail… (NEXT SLIDE)
First, our world is becoming instrumented: The transistor, invented 60 years ago, is the basic building block of the digital age. Now, consider a world in which there are a billion transistors per human, each one costing one ten-millionth of a cent. We'll have that by 2010. There will likely be 4 billion mobile phone subscribers by the end of this year… and 30 billion Radio Frequency Identification tags produced globally within two years. Sensors are being embedded across entire ecosystems—supply chains, healthcare networks, cities… even natural systems like rivers.
Second, our world is becoming interconnected: Very soon there will be 2 billion people on the Internet. But that's just the beginning. In an instrumented world, systems and objects can now &quot;speak&quot; to one another, too. Think about the prospect of a trillion connected and instrumented things—cars, appliances, cameras, roadways, pipelines… even pharmaceuticals and livestock. And then think about the amount of information produced by the interaction of all those things. It will be unprecedented.
Virtually all things, processes and ways of working are becoming intelligent. New computing models can handle the proliferation of end-user devices, sensors and actuators and connect them with powerful back-end systems. How powerful? This year IBM's Roadrunner supercomputer broke the &quot;petaflop&quot; barrier—one thousand trillion calculations per second. Roadrunner is made from the same chips that go into consumer game consoles and the no-cost operating system Linux. Combined with advanced analytics, such supercomputers—and new computing models like &quot;clouds&quot;—can turn mountains of data into intelligence. And that intelligence can be translated into action, making our systems, processes and infrastructures more efficient, more productive and responsive—in a word, smarter .
As the world becomes instrumented, interconnected and intelligent, we have the opportunity to think and act in new ways—economically, socially and technically.
We are all feeling the pressure of the current economic climate, either directly in our company, or simply because we are seeing the constant barrage of stories about troubling economic conditions and weak market and industry trends. As a result of the economy, we are facing a variety of implications: Stock market volatility The credit squeeze Slowing global expansion Banking restructuring And mergers and acquisitions In this challenging economic climate, we see clients around the world asking difficult questions about sustainability, such as: How will we obtain organic growth? How can we cut costs? Will we have access to the skills and resources that we need? Will we remain in business? These are issues that have always been significant, but in the current environment, they’re even more pronounced.
In today’s uncertain environment, CIOs are developing and executing IT contingency plans In late 2008, we started seeing CIOs taking action within their domain to make sure they are getting the most out of their IT investment. Some CIOs are being asked to reduce IT spending or demonstrate faster return-on-investment. Others are simply preparing for potential budget tightening. This slide lists some of the various strategies that CIOs have used in the past (during the last recession in 2001) and are using again, now, to try to manage their IT expenditures during this time of economic uncertainty. Many CIOs are looking for ways to cut short term costs – for example, by putting a freeze on hiring, holding off on new projects, or considering other ways to reduce staffing expense – while also trying to drive larger structural changes in how they manage their IT. They are also considering larger structural changes in how they manage their IT environment.
Reducing current costs can provide an important source of funding for new initiatives Spending on operations continues to consume the largest portion of the IT budget. But it doesn't have to be that way. Technology continues to get smarter, faster and cheaper. You can leverage technology improvements to dramatically reduce the cost of operations — and free up a significantly larger portion of the overall IT budget for investment in new IT solutions that advance the enterprise. For example, you can take cost out of IT operations by consolidating and virtualizing infrastructure….or by increasing energy efficiency…or by using managed services. The money saved can be invested in revamping the supply chain…or overhauling customer relationship management…or anything else that will advance business model change and create greater opportunity. This is the key to driving the business model change the CEO wants to see. This is how CIOs turn IT into a value driver rather than a cost center. To begin our discussion on how to develop sales opportunities in this climate, let's go to the next slide.
It’s time to start thinking differently about infrastructure. It’s obvious that we’re going to have to work a lot smarter and more efficiently.
In this smarter world, we need our infrastructure to propel us forward, not hold us back. This infrastructure is instrumented, interconnected and intelligent and brings together business and IT to create new possibilities. Up to now, we've thought of physical infrastructure and IT infrastructure as separate: airports, roadways, buildings, power plants, oil wells, on the one hand; and datacenters, PCs, cell phones, routers, broadband, etc., on the other. The first was the stuff of concrete, wires and steel; the second of bits, chips and bandwidth. Transition Line: Now, the infrastructure of atoms and the infrastructure of bits are merging, into an intelligent global infrastructure . A dynamic infrastructure.
This approach to a dynamic infrastructure addresses today’s challenges and tomorrow’ opportunities. It allows for improved service - Not just high availability and quality of existing services, but also meeting customer expectations for real-time, dynamic access to innovative new services. And reducing cost- Not just containing it, but achieving breakthrough productivity gains through virtualization, optimization, energy stewardship, and flexible sourcing. And finally, not just managing the risk requirements that we are facing today, with security, resiliency and compliance challenges, but getting in front of new risks that may come with a more connected and collaborative world. Transition Line: We are working with many clients today who are making paradigm shifts in how they are addressing these areas.
What are the defining characteristics of a dynamic infrastructure? What does it mean to be truly dynamic? NOTE: on this slide you just want to introduce the characteristics of a dynamic infrastructure , you will be covering the details on the pages that follow: A dynamic infrastructure: Enables visibility, control, and automation across all business and IT assets : The ability to manage effectively across a converged business and IT infrastructure. Transforms assets into higher valued services: The value of any asset is measured by its ability to deliver services to customers and partners. Is highly optimized to achieve more with less: Optimizing the infrastructure leveraging virtualization, standardization, and energy efficient approaches can help you free up operating expense to drive new investment. Addresses the information challenge: Helping businesses control, protect and gain value from information. Leverages dynamic sourcing – such as cloud computing: The days of a single, self-enclosed data center are gone. Companies with dynamic infrastructures easily source services across value net of delivery providers, ranging from on-premise, to manage services, to cloud computing. Manages and mitigates risk: A dynamic infrastructure must meet the rapidly changing security, availability, and compliance challenges to allow the business to grow and succeed. Each of these characteristics is important and necessary to the ideals of a dynamic infrastructure than can improve service, reduce cost, and manage risk while helping to delivery service with greater agility and speed. Now lets take a closer look at how you can begin to build a more dynamic infrastructure
So how does one go about building a more dynamic infrastructure? This is an evolutionary process – not a rip and replace approach. Organizations are under pressure to drive efficiencies and optimize their processes to achieve more with less. Efficiency of business and IT assets comes from integrating virtualization, energy efficiency, standardization and automation to free up operational budget for new investment This includes working to automate as much functionality as possible to free up not just financial resources, but human capital as well. Converge business and IT infrastructure to work in concert, achieving breakthrough productivity and greater business value: Instrumentation of physical infrastructure resources is enabling more dynamic measurement, allocation and management to support innovation, transformation and differentiation. This transforms assets into valued services through common processes and systems that improve preventive and predictive maintenance and resource allocation to increase overall business performance. Utilize alternative sourcing approaches, like cloud computing, to deliver new services with agility and speed. Companies with a dynamic infrastructure quickly realize direct business benefits by leveraging a blended strategy for acquiring services and delivering information across customers, employees and third-party providers across the value chain. From an organizational perspective, cloud computing delivers services for consumer and business needs in a simplified way, providing unbounded scale and differentiated quality of service to foster rapid innovation and decision making. This can help address the explosion of information and respond to business requirements while reducing capital and operational costs associated with delivery of services.
Assessments hot link is active on this page. (Assessments box is hot linked to 4-pack in the back of the deck. Return button will be on the last page in the module section. You must be in screen show for this to work) As with any strategic plan, the first place to start is to define where it is you want to be. Then assess where you are at today and lay out a roadmap, or blue print to move you forward. But where to start first? Assess the potential benefits of each of the key areas that need to be changed, and choose those that will provide the greatest positive business impact in the shortest period of time. And what does IBM have to offer? This IBM approach is built on real experience with tens of thousands of client engagements IBM has tremendous expertise ranging from business architecture design, strategy and change expertise and overall data center strategy skills that can be used to help create a blueprint for success. Our strategy is based on a very disciplined approach that we have developed over the last decade, working with thousands and thousands of clients. We have built very structured implementation patterns , drawn from our working experiences - and approaches that combine the need to address the business transformation as well as the underlying infrastructure and management transformation. IBM also offers t he broadest systems, storage, software solutions and services portfolio in the industry to find the right fit for your business. In order to help clients create a funding and asset disposal strategy, IBM Global Financing offers customized financing of hardware, software and services for qualified customers, IT asset disposal services including disk data overwrite and IBM Certified Used Equipment, to improve service - accelerate project implementation, obtain capacity without impacting budget; consolidate funding for multi-vendor projects, customized, flexible financing structures to rapidly adapt to IT priorities while matching costs to benefits. further reduce cost - lower IT acquisition costs and improve overall TCO with a programmatic IT refresh strategy based on leasing) , and Manage risk - minimize IT obsolescence, project and financial risk, ensure safe & secure asset disposal. Finally, we bring all of our resources forward to help drive true transformation with an unparalleled research organization and our extensive patent leadership.
Collaborate with IBM, and you’ll have access to the broadest range of resources. The breadth and depth of our skills and expertise is unmatched in the industry; IBM research provides business and technology solutions from new ways to handle information across great distances, to how to improve food production in sub-Saharan climates; and key established resources centers strategically located around the world to take our expertise and skills to the customers. And, as mentioned before, extensive access to online resources for those wanting to simply gain more knowledge, or the true do-it-yourselfers
These areas – shown here- are ALL critically important as areas of focus. Each one incrementally can improve your overall operations. But improvements in one area could cause strain in another. For example: Demands for a better enterprise wide information infrastructure- providing integrated information to end users for example, could stress the issues of security and business resiliency. Creating highly virtualized resources demands a stronger, more integrated service management approach. Consolidation to optimize systems could drive up the density of systems, thereby putting more strain on the environment issues. Converging business and IT infrastructures can be a daunting task, if not handled in an integrated way. So in today’s world- it is critical to look at all of it together. How do things interrelate so that improvements in one area are matched with tools and techniques to support them in another? Taking a view of each of these areas is important but more importantly is a plan to integrate them together, creating the backbone or “dna” needed to thrive in a smarter planet.
Now it’s your choice – to choose out of 18 continuative speeches addressing the key items of dynamic infrastructure in more detail & to define your roadmap for this journey Thank you for your attention and I whish you a very informative day – interesting discussions and much success
Handling Economic Uncertainty While moving forward to a Smarter Planet David Simms - Director, Integrated Technology Services, CEE, May/2009
The need for progress is clear. 170 billion Kilowatt-hours wasted each year by consumers due to insufficient power usage information.
The opportunity for progress is clear. Utility networks : Pacific Northwest National Laboratory In the Smart Grid project, consumers decreased their overall peak load on the grid by 15% when offered the opportunity to save an average of 10% on their electricity bills. 1 10% REDUCTION IN ENERGY COSTS
The need for progress is clear. Annual impact of congested roadways in the U.S. alone. 1 3.7 billion lost hours 2.3 billion gallons of gas
The opportunity for progress is clear. Traffic system : Stockholm, Sweden The city cut traffic by 20%, lowered emissions by 12% and reported 40,000 additional daily users of public transportation. 1 20% LESS TRAFFIC
The need for progress is clear. People worldwide pushed below the poverty line by personal healthcare expenditures. 1 100 million
The opportunity for progress is clear. $30 million in cost savings Smarter healthcare : University Pittsburgh Medical Center This renowned academic medical center projects a $30 million reduction in capital and operating cost reductions over eight years, enabling it to meet an ambitious clinical agenda
We can respond to changes quickly and accurately, and get better results by predicting and optimizing for future events.
Every day, 15 petabytes of new information are being generated. This is 8x more than the information in all U.S. libraries. 1
An average company with 1,000 employees spends $5.3 million a year to find information stored on its servers. 1
New computing models manage the massive amounts of data generated by the proliferation of end-user devices, sensors, and actuators. Combined with advanced analytics, these technologies are making us smarter.
1 New Intelligence White Paper from ThinkForward website
+ + = An opportunity to think and act in new ways— economically, socially and technically.
At the same time the world is becoming more globally integrated, we are navigating uncertain economic conditions
Frozen credit markets and limited access to capital
Energy shortfalls and erratic commodity prices
Information explosion and risk/opportunity growth
Slowing superpowers and emerging economies
New customer demands and business models
The current economic climate is creating budget challenges and the need to cut costs.
Companies must realize near term cost reductions while continuing to drive structural change
Short Term Cost Reductions
New IT project budget freeze
Termination of sub-contracting agreements
Voluntary departure plans
Structural Cost Reductions
Relocation of resources/applications
Central vs. decentralized IT governance
Strategic alignment & prioritization
Type 1 Rationalization “ Reduce Capacity” Type 2 Structural Change “ Transform Fixed into Variable Costs” Cost x X’ Volume Change IT operating model Volume Reduce FTE, minimize overlap, improve control X’ x Cost
Reducing current costs can provide an important source of funding for new initiatives IT Spending Strategic Change Capacity Cost of Operations Operations Maintenance Operations Support New Solutions Application Enhancements Liberated funding for direct saving or transformational investment 100% Today Target Application Enhancements Operations Support Operations Maintenance New Solutions
Top Service Offerings that helps to cut cost and increase productivity of existing infrastructure with a ROI < 18 month
IT Optimization Strategy & Planning
Data Center Energy Efficiency Assessment
Converged Communication – IP Telephony
Video Communication – Telepresence
Virtual Infrastructure Access Services
Network Infrastructure Optimization
Server Consolidation & Virtualization
Storage Optimization & Integration
Information Protection Services
Remote Managed Infrastructure Services
Managed Security Services
Service Management Strategy & Planning
- IT Executive Workshop
Service Management Implementation
- IT Lifecycle Management & governance
Cut costs Get more from existing infrastructure Improve productivity
It’s time to start thinking differently about infrastructure.
In this smarter but economically challenged world, we need our infrastructure to propel us forward, not hold us back. Infrastructure that is We need a dynamic infrastructure. Infrastructure that brings together business and IT to create new possibilities Intelligent Interconnected Instrumented Facilities Infrastructure Production Infrastructure Mobility Infrastructure Technology Infrastructure Communications Infrastructure + + + +
Dynamic Infrastructure: Addressing today’s challenges and tomorrow’s opportunities. Not just containing operational cost and complexity, but achieving breakthrough productivity gains through virtualization, optimization, energy stewardship, and flexible sourcing. REDUCE COST MANAGE RISK Not only addressing today’s security, resiliency, and compliance challenges, but also preparing for the new risks posed by an even more connected and collaborative world. Dynamic Infrastructure Not only ensuring high availability and quality of existing services, but also meeting customer expectations for real-time, dynamic access to innovative new services. IMPROVE SERVICE
Dynamic Infrastructure… … delivers superior business and IT services with agility and speed .
Enables visibility, control, and automation across all business and IT assets.
Transforms assets into higher value services.
Is highly optimized to achieve more with less.
Addresses the information challenge.
Leverages flexible sourcing like clouds.
Manages and mitigates risks.
How do we build a more dynamic infrastructure?
Address today’s operational challenges to free up resources for new investments .
Converge business and IT infrastructure to work in concert, achieving breakthrough productivity and greater business value.
Utilize alternative sourcing approaches, like cloud computing, to deliver new services with agility and speed.