Maximise Software Investment In Uncertain Times


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Maximise Software Investment In Uncertain Times

  1. 1. ® IBM Software Group Managing Applications with Rational Pat Flisher FSS Business Value Lead UKI IBM Rational © 2007 IBM Corporation
  2. 2. IBM Software Group | Rational software IT & Business Executive Pressures Bottom line: IT flexibility enables business flexibility Enterprise Modernization 2
  3. 3. Developing an IT Strategy in Uncertain Times Andy Kyte Vice President & Research Fellow Notes accompany this presentation. Please select Notes Page view. These materials can be reproduced only with written approval from Gartner. Such approvals must be requested via e-mail: Gartner is a registered trademark of Gartner, Inc. or its affiliates.
  4. 4. The Real IT Strategy Challenge Return on Investment Return on Assets • To identify to business • To have a detailed stakeholders the potential understanding of exactly for current and future where you are technology innovations to deliver transformational • And a current plan for the value future life cycle management • To provide business of every asset change sponsors with • Based on the best available accurate cost/ understanding of an optimum risk/timescale estimates direction for IT-dependent business change initiatives • And a process in place to continuously review and optimize direction and plans
  5. 5. Balance Budget Planning and Strategic Planning Budget Planning Strategic Planning • 18-month horizon • Asset half-life or seven-year horizon (whichever is longer) • Objective — • Objective — quot;maximize quot;have a budgetquot; return on assetsquot; • Project-focused • Value-focused • Administrative overhead • Core discipline of IT management • Once per year • Continuous • Horse-trading • Portfolio management
  6. 6. Developing Persistent Commitment N.B. quot;Engagementquot; with maximizing value delivery High Business Engagement IT Engagement Engagement quot;They shoot The beginning horses, don't Of quot;legacyquot; they?quot; Low Live 5 Years 10 Years 15 Years 20 Years Asset Persistence
  7. 7. IBM Software Group | Rational software The world continues to get a whole lot smarter INSTRUMENTED INTERCONNECTED INTELLIGENT We now have the ability People, systems and We can respond to changes to measure, sense and objects can communicate quickly and accurately, and get see the exact condition and interact with each better results by predicting and of everything. other in entirely new ways. optimizing for future events. Today, there are 1 billion The internet of people is 1 Every day, 15 petabytes of new transistors for each person billion strong. Almost one third information are being generated. on the planet. of the world’s population will be This is 8x more than the information By 2010, 30 billion RFID tags on the web by 2011. in all U.S. libraries. will be embedded into our There will be nearly 4 billion An average company with 1,000 world and across entire mobile phone subscribers employees spends $5.3 million a ecosystems. worldwide by the end of 2008. year to find information stored on its servers. Enterprise Modernization 7
  8. 8. IBM Software Group | Rational software Fleet Management Daimler FleetBoard What’s Smart? Smart end-to-end system optimizing vehicle usage and routing Innovative technology for advanced telematic solutions Smarter Business Outcomes 5-10% reduction in fuel consumption due to optimized vehicle management 10% reduction in telecommunications costs due to increased automation “Focal Point helps us discover the optimal set of customer features How Rational Software Enables and balance those against the Smarter Products needs of our business, allowing us Improved collaboration in the product to deliver continual enhancements portfolio planning process to our telematic solution.” Automated release planning balancing cost, risk and reward Enterprise Modernization 8
  9. 9. IBM Software Group | Rational software Mobile Access to Medical Images Merge Healthcare What’s Smart? Provides medical professionals access to complex medical images on mobile devices Helps ensure prompt emergency diagnosis – anytime or anywhere Smarter Business Outcomes Reduced hospital operations costs Reliable, secure, scalable delivery of medical images and reports “We rely on Synergy and Change to How Rational Software Enables manage the complexity of the Smarter Products software and to ensure that our global development teams operate Collaboration across globally distributed as one, for the best result to our development teams customers. This software from IBM is Change management across the end- part of our livelihood; it's our DNA.” to-end software lifecycle Enterprise Modernization 9
  10. 10. IBM Software Group | Rational software Challenges to the effective delivery of software A history of cost overruns, schedule slips and quality issues “62% of projects failed “50% of outsourced projects to meet their schedules ” are expected to under perform” “49% of projects suffered “Only 42% of users are budget overruns” satisfied with project quality” “Only 37% are satisfied with the “41% of projects fail speed of software development” to deliver the expected business value and ROI” “Only 34% of software projects are deemed successful costing over $300B annually” Enterprise Modernization 10
  11. 11. IBM Software Group | Rational software The software challenge in systems is even greater Software failures can be dramatic for complex systems Aerospace Microsoft Ford Super Agency Zune Duty Pickup $1B prototype rocket 1 million owners of the Sales interrupted until self-destructed just 30-gigabyte device woke engine control software 40 seconds after takeoff up one morning to find could be updated to due to a software bug their devices inoperable recognize improper in the on-board due to poor leap year levels of heat in the guidance system handling exhaust system Enterprise Modernization 11
  12. 12. IBM Software Group | Rational software Old methods of measuring software engineering are inadequate and incomplete considering today’s complexity and scale 1960s-1970s 1980s-1990s Complexity 100% Custom 30% Reused Assets 70% Custom Process Ad-hoc Repeatable Teams Collocated Collocated On the job training Software skills Tools Proprietary Mix of Proprietary & Commercial Not integrated Not integrated Project Predictable Unpredictable Performance Over budget, over schedule Infrequently on budget, on schedule Success Rate 10% 25%-33% Enterprise Modernization 12
  13. 13. IBM Software Group | Rational software Challenges to effective software delivery today Complexity Challenges Team Challenges More granular service functionality Geographically dispersed teams in composite business applications that often include business partners Large number of projects and Effective cross-organizational assets including custom, outsourced visibility and synchronization, and packaged sharing becomes an imperative Process Challenges Tools Challenges Need for market experimentation Lack of standards impacts ability to collaborate, automate and report Blind adherence to process insensitive across teams and assumptions to potential business trade-offs Frequent asset updates and Need for agility at scale changing interdependencies How do I control this new world to gain advantage? Enterprise Modernization 13
  14. 14. IBM Software Group | Rational software Software engineering metrics that measure absolutes can provide the wrong incentives to your team Enterprise Modernization 14
  15. 15. IBM Software Group | Rational software Software engineering metrics must align with desired business outcomes 3 Value 2 Address development as a value creation center 1 Efficiency Foster innovation and reuse across organizational and geographical boundaries Address development Control as a cost center Enterprise application modernization Address the risks Productivity Speed merger and of development Software engineering acquisition absorption Perceived quality base quality Reduce traditional Scope uncertainty Process agility development in favor of smart package software Security failure Global collaboration integration and SOA platform Failing an audit Enterprise Modernization 15
  16. 16. IBM Software Group | Rational software Effective software delivery enabled by measurement Software Value investment management Project/Program aligned with Governance business priorities Global team Efficiency effectiveness and Individual quality collaboration and efficiency improvements Breadth of Impact Control Value INDIVIDUAL TEAM ORGANIZATION BUSINESS Measures of Reduction in Reduction in Increase in project Increase in architectural increasing scrap/rework and development labor predictability reuse and earlier time to associated labor cost worldwide Increase in quality value value costs Reduction in Improved market Increase in organizational Improvement in custom assets, reputation productivity, profitability release quality training, tooling and and market reputation process variants Enterprise Modernization 16
  17. 17. IBM Software Group | Rational software How can I get to more effective software delivery from where I am today? “How do I further automate software delivery within my organization?” “How can I enable collaboration throughout the software delivery process?” “How can I unobtrusively gather measurements to ensure progress towards desired business outcomes?” “How do I make incremental, iterative progress towards more effective software delivery?” Enterprise Modernization 17
  18. 18. IBM Software Group | Rational software Software delivery is a business process that must be continuously improved Implementation Requirements Deployment /Assembly Design Verification CIO’s top priority on behalf of the CEO over last three years: “Improving Business Processes” Source: Gartner, “Making the Difference: The 2008 CIO Agenda,” Jan. 2008 Enterprise Modernization 18
  19. 19. IBM Software Group | Rational software To improve coordination and visibility, look for ways to collaborate across the software delivery process Leverage social networking capabilities to enable broader and richer participation in software projects Collaborate Virtualize quot;team memoryquot; to Drive organizational overcome geographic and temporal consensus on priorities gaps in the software lifecycle and improve workforce productivity Enable flexible, global resourcing and energy-saving workplace models Enterprise Modernization 19
  20. 20. IBM Software Group | Rational software In Context collaboration Project Manager Developer / Build Engineer Tester Enterprise Modernization 20
  21. 21. IBM Software Group | Rational software To increase efficiency, look for ways to automate the business process of software delivery Improve productivity and reduce headcount Standardize processes and automate repetitive tasks to Automate improve team efficiency while Lower costs and improve reducing time to value quality by automating workflow based on real-time information Enhance regulatory compliance through self documenting data and workflows Enterprise Modernization 21
  22. 22. IBM Software Group | Rational software Process Awareness Project Manager Developer / Build Engineer Tester Enterprise Modernization 22
  23. 23. IBM Software Group | Rational software To ensure progress towards business outcomes, look at how to report on the software delivery process Make better informed decisions by leveraging the real-time instrumentation of the software delivery process Leverage metrics for continuous individual and team capability Report improvement Continuously improve by measuring progress against desired business outcomes Gain insight into a projects which span organizational and geographic boundaries with minimal disruption Enterprise Modernization 23
  24. 24. IBM Software Group | Rational Software Application Management and Modernisation Solutions Aimed at Customers with: Escalating or Permanently High Costs – Most spend too much time and resource on maintaining old applications (up to 80% of IT budget is maintenance) Desire to Innovate and Gain a Competitive Edge –In the current economic conditions IT needs to enable the business to differentiate and react speedily as those conditions change – yet resource available to do so is tied up in the existing applications. Proven, Available Solutions - whichever direction the process takes you, secure risk free and productive support solutions are essential. Real Solutions: Organisations can do two things outside the scope of this discussion - nothing (and pay for ever increasing costs) and replace everything by buying packages or outsourcing totally Once the applications are there are four other options which can to be discussed in detail –each will bring its own set of returns : • “Update” – Increase the support of the business and the business throughput by improving the user experience (both look and feel and navigation) • “Optimise” – Make it easier (and cheaper) to maintain the back-end applications. This can also support Application or Package retirement in a managed way (eg full impact known and understood with a mediation process in place for ensuring continuity of service [and services]) • “Convert” – Move the existing applications ‘as is’ to a new platform using automated tooling. Often • ..and “Re-write” – Start again but making use of the existing assets and extracted designs. Move to a ‘write once, use many times’ environment, increaing quality and lowering costs …but first there needs to be a management framework in place. Page 24
  25. 25. IBM Software Group | Rational Software The Four Options… Updated Modern Application Screens R (Java) Update “look B & feel” Transformation/ D Portal Conversion or Updated R Application Older, A (COBOL) Refactoring Expensive D “Rationalised” to Efficient Updated Version Maintain & Application of the Inflexible (Java EJB) Application (legacy) Applications Reusable Components or Re-Build or RAD Extract or Services New Design RBD Application SOA Page 25
  26. 26. IBM Software Group | Rational Software Enterprise Modernisation in a Managed Framework Application How do we decide Now we know what Modernisation where we should we are going to do Propositions start? Which first first and why, which -Update steps will be low risk tools are we going to and high return? use? What services -Optimise do we need? -Rewrite -Convert Next Project Loop Back Where are we starting from? Do we have a picture Have we got a suitable How are we going to of the current Architecture? Management Process for document the All the portfolio? Do we the Projects in place? Will requirements? know which Business we have visibility of ..through to – How processes are involved? progress (whoever is are we going to re- doing the work)? test everything? Page 26
  27. 27. IBM Software Group | Rational Software Enterprise Modernisation – via Systems Architect, Focal Point and Rational Team Concert Application HATS, RAA, Modernisation RAM, RAD, Propositions Focal RBD, RDi, RDz, -Update Conversion -Optimise Point Tools, ….. -Rewrite -Convert Next Project Loop Back Systems ReqPro, Doors, Architect Rational RRC, CC, CQ, Team Synergy, RQM, Concert QM portfolio, ….. Page 27
  28. 28. IBM Software Group | Rational Software Rational Portfolio in Modernisation Projects Process Improvement Manage RTC RMC RPT RQM Test For Portal HATS Requirements Automated Conversion Tools Update Convert Watchfire Screens Build RRC Legacy Enterprise Architecture RAM -(Systems Architect) Optimise Re-Write - “As Is” and “To Be” Assets Rational Analyse Design Transformation SOA Architect Decisions? Workbench Focal Point Page 28
  29. 29. IBM Software Group | Rational Software Returns…. Return on Investment or Return on Assets? Link to Gartner slides (Delivered at the Rational Executive Forum in April 09) Implementing and using a product like Systems Architect will produce a Return on Investment in the short term of 20 -30%; Managing your Application Portfolio actively and effectively over a longer period of time will give the business a much larger Return on their Assets – over the lifetimes of the assets Returns can be calculated for each product deployed and for supporting a customer’s overall investment but the returns are very much customer specific – we need to know the “As Is” and the “To Be” to calculate the returns, whichever view is to be taken. Returns are calculated by a combination of working with the customer, Proofs of Technology and Concept and by comparing with experiences of similar customers. The Measured Capability Improvement Framework MCIF provides a structured approach to helping organisations identify improvement in the core development practices that most impact business outcomes. It is a services engagement involving key customer personnel that looks at the current capabilities, what can be improved, how – and the returns to be expected Jazz products. A new set of benefits are developing for the Jazz products shown below which can be summed up as “Return on your People as the most important Asset” They start with the concept of Collaborate, Automate and Measure We expect to measure all activities going forward to see the Returns as the develop using Rational Insight Page 29
  30. 30. IBM Software Group | Rational Software Page 30