The IT Utility Can Lower Costs But Raises Many Challenges For CIO's, Finds IDC
Announcement posted by IDC 25 Nov 2003
In a recent study, IDC found that one of the biggest obstacles for CIOs wanting to leverage on-demand services through the IT Utility Model (I pay for what I use computing) Utility Computing Options: Public Utility - A public utility is one in which unrelated customers share a common infrastructure that is managed by a third-party service provider and owned by the service provider. is going to be developing a satisfactory customer/supplier relationship and giving up control of assets under management, as revealed in IDCs latest ITEyewitness report, Lowering the cost of connecting your business.
This study was conducted as part of IDC's global end-user research to understand what alternate forms of sourcing todays organisations are considering to minimise capital expenditure required for IT agility. The utility model promises to improve operational efficiency, quality of service and the ability to respond quickly to changing demands. Although the concept of computing on demand is already accepted by many, this study reveals that getting to the point where computing resources are always available when needed, where needed and with as much capacity and capability as needed is still a big challenge.
The report, Lowering the cost of connecting your business reveals the IT Utility Model cannot be adopted based on costs alone; it must be considered in the context of business drivers such as: business model innovation; process superiority; and cost/performance improvement, said Catherin Bennett, IDCs Director User Programmes.
IDCs research suggests that worldwide IT spending will continue to grow to almost US$1 trillion, into spending segments: 46% routine infrastructure, 28% ongoing initiatives, and 26% on new initiatives. The report found that there are different business drivers behind this growth in spending and that more than one approach to evaluating IT investments is needed. This report reveals the benefits offered by the IT Utility Model, the challenges it poses for overall IT/business operating models, future outlook and actions for success.
This study also revealed the IT Utility is considered by many to be the way of the future. IDC considers the provisioning of computing capacity as a utility to be the next stage in the evolution of traditional IT outsourcing and managed services. added Catherin Bennett, IDCs Director User Programmes.
Organisations need to consider all critical solution elements: people, processes, technology and financial justification that could inhibit and/or enable adoption of the IT Utility Model. said Bennett.
The challenges for CIOs adopting the IT Utility Model will be ensuring resources are always available when needed, where needed, and with as much capacity as needed. However, giving up control of assets under management may prove to be the biggest challenge for CIOs.added Ms. Bennett.
Click here to go to the press release: http://www.idc.com.au/resources/press/corporate/20031124_IT%20Utility.htm
This study forms part of IDC's ITEyewitness report series. To purchase this report, please contact Catherin Bennett on Ph: 02-9925 2259 or via email: cbennett@idc.com.
About IDCs End User Programme:
IDC recognises that IT managers and practitioners utilise a number of sources for knowledge and assistance. Our experience shows these include: Specialists, Research, Statistics, Tools and a network of people. IDC addresses each source through our research and advisory Management Portfolio for IT service. This portfolio of products and services for IT Managers focus on current research, tactical approaches, real life case studies and proven practices. Through this research and advisory programme IDC assists clients in making more informed business decisions regarding their use and application of information technology.
Additional information can be found at www.idc.com.au/managementportfolio *
This study was conducted as part of IDC's global end-user research to understand what alternate forms of sourcing todays organisations are considering to minimise capital expenditure required for IT agility. The utility model promises to improve operational efficiency, quality of service and the ability to respond quickly to changing demands. Although the concept of computing on demand is already accepted by many, this study reveals that getting to the point where computing resources are always available when needed, where needed and with as much capacity and capability as needed is still a big challenge.
The report, Lowering the cost of connecting your business reveals the IT Utility Model cannot be adopted based on costs alone; it must be considered in the context of business drivers such as: business model innovation; process superiority; and cost/performance improvement, said Catherin Bennett, IDCs Director User Programmes.
IDCs research suggests that worldwide IT spending will continue to grow to almost US$1 trillion, into spending segments: 46% routine infrastructure, 28% ongoing initiatives, and 26% on new initiatives. The report found that there are different business drivers behind this growth in spending and that more than one approach to evaluating IT investments is needed. This report reveals the benefits offered by the IT Utility Model, the challenges it poses for overall IT/business operating models, future outlook and actions for success.
This study also revealed the IT Utility is considered by many to be the way of the future. IDC considers the provisioning of computing capacity as a utility to be the next stage in the evolution of traditional IT outsourcing and managed services. added Catherin Bennett, IDCs Director User Programmes.
Organisations need to consider all critical solution elements: people, processes, technology and financial justification that could inhibit and/or enable adoption of the IT Utility Model. said Bennett.
The challenges for CIOs adopting the IT Utility Model will be ensuring resources are always available when needed, where needed, and with as much capacity as needed. However, giving up control of assets under management may prove to be the biggest challenge for CIOs.added Ms. Bennett.
Click here to go to the press release: http://www.idc.com.au/resources/press/corporate/20031124_IT%20Utility.htm
This study forms part of IDC's ITEyewitness report series. To purchase this report, please contact Catherin Bennett on Ph: 02-9925 2259 or via email: cbennett@idc.com.
About IDCs End User Programme:
IDC recognises that IT managers and practitioners utilise a number of sources for knowledge and assistance. Our experience shows these include: Specialists, Research, Statistics, Tools and a network of people. IDC addresses each source through our research and advisory Management Portfolio for IT service. This portfolio of products and services for IT Managers focus on current research, tactical approaches, real life case studies and proven practices. Through this research and advisory programme IDC assists clients in making more informed business decisions regarding their use and application of information technology.
Additional information can be found at www.idc.com.au/managementportfolio *