InformationWeek Stories by Chris Murphy

InformationWeek Stories by Chris Murphyhttp://www.informationweek.comInformationWeeken-usCopyright 2012, UBM LLC.2012-12-19T09:06:00ZInternet Of Things: Coming To Pool Near You?IT pros need to start conversations about how networked devices might change their businesses, no matter how unlikely the application might be.http://www.informationweek.com/global-cio/interviews/internet-of-things-coming-to-pool-near-y/240144572?cid=RSSfeed_IWK_authors<div class="inlineStoryImage inlineStoryImageRight"><a href="http://www.informationweek.com/windows/microsoft-news/8-cool-windows-8-tablets-for-home-and-of/240010621"><img src="http://twimgs.com/informationweek/galleries/automated/889/01_Intro_tn.jpg" alt="8 Cool Windows 8 Tablets For Home And Office" title="8 Cool Windows 8 Tablets For Home And Office" class="img175" /></a><br /> <div class="storyImageTitle">8 Cool Windows 8 Tablets For Home And Office</div> <span class="inlinelargerView">(click image for larger view and for slideshow)</span></div>Technology pros need to help their companies figure out how to cash in on the Internet of things. I got a letter from a reader today that shows how these discussions -- and letting people know what's possible -- can spark practical ideas in this area. <P> The reader, Rick Regan, owns a lighting business. He sees big potential for networked lights that can collect and send data about their condition, report on activity around them and allow for remote control. But he wrote to relay a chat with an electric service company that repairs wiring, installs fixtures and the like. Writes Regan: <P> "I was there one day and showing off a small device (a Moxa Cellular RTU) that has some digital I/O, some relay outputs and a cellular modem. I demonstrated a photocell coming on, which turned on a LED light bulb -- and sent an SMS message to my phone that it had come on. While not rocket science, this was pretty advanced for these guys, not ever having any PLC or automation training. They immediately said, 'Swimming pool monitoring!' Uh, what? <P> <strong>[ Wireless sensors already abound. Read <a href="http://www.informationweek.com/byte/when-wireless-sensors-meet-big-data/240005987?itc=edit_in_body_cross">When Wireless Sensors Meet Big Data</a>. ]</strong> <P> "They said that a big problem for one of their customers is monitoring swimming pool pumps. They said that a tech would go out to a pool at a hotel or gym, check on the pumps and filters and leave. But invariably there would be a problem that would pop up 10 minutes after the guy has left the parking lot. But nobody knows until the pump fails and people start complaining about the pool. Now everybody is mad. The boss is getting a lot of heat. The tech gets yelled at and goes blasting back to fix the problem. They said if they could install a device like this that would just send a text message when the pump stops (or a contact closes, or whatever), then the guy can turn right around and fix it before all hell breaks loose." <P> Regan half apologizes to me for sharing a simple-sounding use, but to me that's what makes it so interesting: Is this the Internet of Things described by GE, with turbines, auto-driving cars, big data with statistical analysis and predictive maintenance? No. But monitoring a VFD with a device that alarms through SMS and an iPad app seems pretty functional, innovative and valuable to these guys. <P> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"><div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"><a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a><div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div><span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span></div> </div>   <P> Functional and valuable are exactly the point. We need to ask questions now to anticipate how the Internet of things will change our businesses. What if I knew something sooner? Is there a missing piece of knowledge that, if I had sooner, would let me save money and time, provide better service, sell more? <P> Not all those vital data points are gettable today, and we'll spend a lot of time in the coming year looking at the limits of the Internet of things, where the shortcomings are and what emerging technology is needed to drive this trend. But it's time to have the discussions about what data is needed and what might be possible.2012-12-13T09:06:00Z6 Ways IT Still Fails The BusinessIT leaders should prepare their teams to avoid these mistakes in 2013.http://www.informationweek.com/global-cio/interviews/6-ways-it-still-fails-the-business/240144288?cid=RSSfeed_IWK_authors <div class="inlineStoryImage inlineStoryImageRight"><a href="http://www.informationweek.com/global-cio/interviews/20-great-ideas-to-steal/240006553"><img src="http://twimgs.com/informationweek/galleries/automated/860/01_Intro_tn.jpg" alt="20 Great Ideas To Steal" title="20 Great Ideas To Steal" class="img175" /></a><br /> <div class="storyImageTitle">20 Great Ideas To Steal</div> <span class="inlinelargerView">(click image for larger view and for slideshow)</span></div>  The harsh truth is that everyone remembers IT's mistakes more than its victories. So in that spirit, we're looking back on some of the problems we've written about in 2012 in hopes of purging those demons in the year ahead. <P> Sure, IT teams are doing a lot of things right. Cloud is a great example -- IT teams are increasingly not just open-minded to cloud software and infrastructure options, they're also starting to become the lead advocates for it. And a lot of everyday victories are things that never happen: systems that stay up. But every good IT leader has a spirit of constructive dissatisfaction, looking for ways to get better and test new boundaries. <P> So here's a list of six ways IT is still failing the business, with survey data and examples to back up why we see these risks. <P> <strong>1. IT Is Still Underestimating Mobile's Impact</strong> <P> Only 53% of IT teams are very or extremely involved in creating a mobility policy for their company, including bring-your-own-device, according to our <em>InformationWeek IT Perception</em> survey. This response is identical for IT and non-IT respondents, one of the rare areas they're in agreement. <P>   <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div>   <P> That means almost half of IT shops are sitting out -- or are cut out -- of the mobile discussion. IT leaders need to insert themselves in this conversation. They need to help companies make the most out of mobile devices, not just help manage them. Too often, IT has been caught napping in the mobile revolution. <P> First, too many IT shops missed the iPhone revolution by initially fighting their use by employees rather than seeing the potential and rolling up their sleeves to solve security problems. Then -- fool me twice -- they missed the iPad revolution, with too many seeing it, at best, a "niche-y" gadget. In 2010, almost 70% doubted that even 10% of employees would get tablets; in our just-completed <em>InformationWeek Outlook 2013</em> survey, it's down to half. Our survey finds that 35% of companies have mobile device management software on their project lists for the coming year, but only 26% are creating mobile apps for customers, and a mere 18% are creating mobile apps for employees. <P> <center><img src="http://twimgs.com/informationweek/1354/2013_projects.jpg" width="459" height="631" alt="chart: IT Projects For 2013" hspace="0" vspace="0" border="0" style="margin-bottom:7px;" /><br /></center></p> <P> Too many IT shops got caught like <a href="http://www.informationweek.com/global-cio/interviews/8-it-mistakes-must-have-lessons-from-top/240007998">this forward-looking IT operation</a> that nevertheless didn't move fast enough on tablets for the sales team: "Mobile computing has been a key component of our IT strategy for several years. We've delivered on initial focus areas, building mobile applications for customers and enabling employee personal mobile device access to company email. Our mistake was in not anticipating the dramatic surge in popularity of the iPad commensurate with the release of the iPad 2. Sales force demand to leverage company-liable tablets rose suddenly, requiring us to be uncustomarily reactive. IT quickly bridged the gap, setting policy and implementing mobile device management, which enabled the company to mitigate financial impacts. However, we're still working to regain the full confidence of our sales executives." <div class="inlineStoryImage inlineStoryImageRight"><a href="http://www.informationweek.com/cloud-computing/infrastructure/7-dumb-myths-about-cloud-computing/240124922"><img src="http://twimgs.com/informationweek/graphics_library/175x175/money_cloud.jpg" alt="7 Dumb Cloud Computing Myths" title="7 Dumb Cloud Computing Myths" class="img175" /></a><br /> <div class="storyImageTitle">7 Dumb Cloud Computing Myths</div> <span class="inlinelargerView">(click image for larger view and for slideshow)</span></div>  <strong>2. IT Budgeting Is Unrealistic</strong> <P> When we asked 453 IT pros about 16 different project types, the majority described the same funding scenario for every one of them: It will increase IT costs in the short term but decrease operating costs long-term. <P> That strikes us as, well, nonsense, and it led us to <a href="http://www.informationweek.com/global-cio/interviews/why-it-has-a-credibility-problem/232901377"> this cover story</a> about raising IT's credibility problem. Of course, IT projects such as a private cloud infrastructure absolutely must follow this model. So when 63% say cloud infrastructure will cause a short-term increase in capital spending and about two-thirds say it'll mean long-term capital savings and operational savings, it makes sense. But the 50% who think deploying mobile device management will lead to overall cost savings sound optimistic. <P> Deploying a new software platform to support a new tier of mobile devices, be they employee- or company-owned, sounds like a solid strategic move to engage employees and help them collaborate, but it also sounds like a tough cost savings plan. Likewise, building a big data business intelligence or decision-support system is seen as a cost saver by 73% of companies. Likely a smart investment, but it seems as likely to be an expense that lets the company spot revenue opportunities -- something less than one-third envision. <P> Jonathan Feldman writes, "It's hard not to read the survey data and think of anything but unbridled optimism. But it's not grounded in reality. … Everyone's going to spend in the short run but save in the long run." Feldman offers additional insight into budgets in <a href="http://www.informationweek.com/global-cio/interviews/it-has-changed-but-it-budgets-havent/240009244">a recent article</a> that found 4 of 10 companies either don't have an IT governance board or it has little influence on IT spending. <P> <strong>3. IT Is Too Slow</strong> <P> Asked if their organization was "distributed, agile, and flexible," a slim majority of IT pros -- 57% -- agree. In contrast, barely one-fourth -- 27% -- of businesspeople outside IT agree. It's a glaring gap, one of the worst differences in perception between IT and non-IT employees in our <em>InformationWeek</em> survey of <a href="http://www.informationweek.com/global-cio/interviews/why-business-doesnt-look-to-it-for-innov/240008408">IT Perception</a>. <P> We sounded this alarm almost <a href="http://www.informationweek.com/global-cio/interviews/it-is-too-darn-slow/229218781">two years ago</a>. The reality is that IT will never be fast enough. Marketing will always want projects yesterday. Technology is too essential and moves too fast. <P> The key element is this: When business units decide to move fast, do they consider IT a partner that will help a project get done more quickly? Do they trust IT to help find the right outside developers, if needed, to steer through the security and compliance concerns with practical answers that balance speed and market pressure as well as risk? <P> More companies are creating customer-facing apps and embedded software as part of their products. If CIOs are going to be part of developing those products, speed will be key. As Vail Resorts CIO Robert Urwiler <a href="http://www.informationweek.com/global-cio/interviews/vail-resorts-app-links-the-mountains-to/240006824"> puts it</a>, "An 18-month plan is not an appropriate plan. We need to be able to spin things up very quickly." <div class="inlineStoryImage inlineStoryImageRight"><a href="http://www.informationweek.com/software/information-management/13-big-data-vendors-to-watch-in-2013/240144124"><img src="http://twimgs.com/informationweek/galleries/automated/924/BigDataLogos_tn.jpg" alt="13 Big Data Vendors To Watch In 2013" title="13 Big Data Vendors To Watch In 2013" class="img175" /></a><br /> <div class="storyImageTitle">13 Big Data Vendors To Watch In 2013</div> <span class="inlinelargerView">(click image for larger view and for slideshow)</span></div>  <strong>4. IT Isn't Building Data-Powered Decision Tools</strong> <P> One-third of companies use dashboards extensively to provide interactive data visualizations. In comparison, 60% use spreadsheets extensively, and half use emailed PDF or HTML reports. This suggests plenty of room to move away from a mentality of backward-looking reports and toward data-driven decision-making tools. <P> The good news: This shift is starting. Almost half of companies (47%) plan to use analytics or BI for predictive analysis, compared with one-third that do so now. Only 20% have no plans for such use. That 47% is by far the highest category of "planned use" among 14 areas for <a href="http://www.informationweek.com/big-data/news/big-data-analytics/analytics-gets-more-accurate-more-accessible/240142189 ">analytics use</a> in our <em>InformationWeek</em> Analytics, BI and Information Management Survey. This isn't just IT's problem -- business unit leaders need to stop relying on rear-view mirror reports and start pushing for predictive analysis. <P> <strong>5. IT Hasn't Built A Bridge To Marketing</strong> <P> Barely half (51%) of IT pros characterize IT's relationship with marketing as good or excellent, our Outlook 2013 survey finds. Almost one in five (18%) says it's poor or fair. Human resources and supply chain are the only areas close to that, with only 54% and 53% rated as good or better. On the flip side, almost two-thirds describe their finance and CEO relationships as good or excellent. <P> IT can't let this stand. Marketing increasingly relies on data and analytics to do its job. Product development increasingly means apps and embedded technology as a key part of what makes products special. IT needs to contribute to those efforts. At the C-level, it's up to CIOs and CMOs to build this bridge -- and to the CEO to insist that it happens. Just as important, CIOs need to embed staff-level leaders inside the marketing organization to serve as a resource and plug the marketing efforts into the larger IT strategy. <P> <strong>6. IT Doesn't Focus On The End Customer</strong> <P> This is the area we've seen some of the greatest change in recent years -- for the better. The best IT teams and IT pros have always understood their industry as well as the technology. But the combination of mobile computing and improving analytics have let the best IT shops get closer than ever to their customers -- the people or companies who buy their products. <P> Companies are creating mobile apps for their customers, using analytics to understand and market to customers in new ways and embedding more technology in their products. In this year's <em>InformationWeek 500</em>, 46% had introduced an IT-led product or service; in 2009, just 37% had. Likewise, 30% include "engage customers in new ways" as a top priority, where 20% did three years ago. <P> Again, this isn't just IT's problem. Some companies chase these tech-powered customer opportunities by routing around the IT organization, hiring an outside mobile app developer or implementing customer analytics without IT's involvement (see the previously discussed concern about IT moving too slow). IT must be a part of those discussions, even if the decision is to outsource development or use cloud software. <P> <i>Tech spending is looking up, but IT must focus more on customers and less on internal systems. Also in the new, all-digital <a href="http://www.informationweek.com/gogreen/121012/?k=axxe&cid=article_axxt_os">Outlook 2013</a> issue of InformationWeek: Five painless rules for encryption. (Free registration required.)</i>2012-12-13T00:05:00ZResearch: 2012 State of IT Staffinghttp://reports.informationweek.com/abstract/166/9136/Professional+Development+and+Salary+Data/research-2012-state-of-it-staffing.html?cid=RSSfeed_IWK_authors2012-12-12T12:54:00ZTell Me Again Why CEOs Should TweetSocial media matters, but that doesn't mean it's every CEO's job to participate.http://www.informationweek.com/global-cio/interviews/tell-me-again-why-ceos-should-tweet/240144283?cid=RSSfeed_IWK_authors<div class="inlineStoryImage inlineStoryImageRight"><a href="http://www.informationweek.com/news/galleries/global-cio/interviews/232700109"><img src="http://twimgs.com/informationweek/galleries/automated/765/01_CEO_Logos_tn.gif" alt="8 CEOs Speak: IT Projects That Matter Most" title="8 CEOs Speak: IT Projects That Matter Most" class="img175" /></a><br /> <div class="storyImageTitle">8 CEOs Speak: IT Projects That Matter Most</div> <span class="inlinelargerView">(click image for larger view and for slideshow)</span></div> Help me with this one: Which CEOs you follow on Twitter regularly serve up must-read tweets? <P> I follow a handful of big-name CEOs, and I don't get much out of their tweets. And it makes me wonder if tweeting is a waste of time for most CEOs. <P> That's heresy to some. I'm sure it is to one CEO -- Josh James, of business intelligence software startup Domo (whom I also follow). Domo recently published a study with CEO.com that showed how little time Fortune 500 CEOs spend on social media. The study showed that CEOs at high-growth Inc. 500 companies tweeted far more often, had more Facebook friends and more LinkedIn ties. <P> <strong>[ Read <a href="http://www.informationweek.com/thebrainyard/commentary/social_networking_consumer/240003920/fortune-500-ceos-shy-away-from-social?itc=edit_in_body_cross">Fortune 500 CEOs Shy Away From Social</a>. ]</strong> <P> Among the findings of the <a href="http://www.ceo.com/social-ceo-showdown-report/">study</a>: <P> -- 3.8% of Fortune 500 CEOs are on Twitter, while 29.1% of Inc. 500 CEOs are on it. <P> -- Inc. 500 CEOs have been on Twitter 56.1% longer on average than Fortune 500 CEOs (about 1.2 years longer). <P> -- Fortune 500 CEOs have on average of 133.45 friends on Facebook, while Inc. 500 CEOs have an average of 561 friends. <P> -- 25.9% of Fortune 500 CEOs have LinkedIn profiles, while 77.6% of the Inc. 500 do. <P> Domo's James calls the <a href="http://www.domo.com/blog/2012/07/ceos-afraid-of-going-social-are-doing-shareholders-a-massive-disservice ">scant social media presence</a> by Fortune 500 CEOs "mind blowing" and a "massive disservice." (You might not know Domo yet, but <a href=" http://www.domo.com/company/executive-team#view/0 ">James</a> founded Omniture and sold it to Adobe for $1.8 billion.) Writes James: <P> <em>Social media isn't a passing fad. The primary reason you have to be social is because that is where your customer lives. Even if you are not leveraging it to close business and interact with your customers, you have to spend enough time online to at least understand the shift in the world. This lack of engagement would be similar to 50% of the world using email with F500 CEOs holding out; or 50% of your customers shopping online but no CEOs trying it.</em> <P> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"><div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"><a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a><div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div><span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span></div> </div>   <P> There's no denying that sites such as Facebook, Twitter and LinkedIn are now part of the daily fabric of most people's lives. And CEOs have a responsibility to their shareholders to be visible. CEOs who shun social media risk losing touch with some of their most lucrative customers, prospects and influencers. I agree CEOs need to understand social media, and that understanding it takes a certain level of immersion and use. <P> But I don't buy that every CEO needs to be a tweeter or be a visible and active presence on social media. To me, it's like the CEO starring in the company's commercials: It's the rare bird who does that well. <P> Who are the terrific big company CEO tweeters I'm missing? I'm one of Oracle CEO Larry Ellison's 34,281 devoted followers, and like them, I got his first-ever tweet on June 6. I can't wait to read his second one. I'm also one of the 44,447 followers of Salesforce.com CEO Marc Benioff, who has sent 1,840 tweets, including one today taking a pot shot at Windows 8. I can't say either executive's Twitter presence has had a discernable impact on my opinion or understanding of his company. <P> I'm open minded; I think it's possible for a CEO to add value by tweeting. Look at Domo CEO James. He had something thought-provoking to say on Twitter, and it got my attention. But as companies get larger, specialization takes over, and the same holds true of social media. If a CEO has a passion for tweeting, maybe there's a role for it. But building a Twitter presence takes a fair amount of time, time that most CEOs would spend better elsewhere. <P> <i>Stay ahead of the eCommerce technology curve. Watch our webcast, Next Generation e-Commerce Strategies for B2B Sales and Marketing, to learn the strategies and tactics you can use to more efficiently give your clients what they want, keep them happy and increase sales. <a href=https://www.techwebonlineevents.com/ars/eventregistration.do?mode=eventreg&F=1005250&K=ECOMEAIBM">Register now</a>.</i>2012-12-11T14:50:00ZUnion Pacific Opens Austin Software Development CenterCIO Lynden Tennison goes where the talent is to build his development team.http://www.informationweek.com/global-cio/recruiting/union-pacific-opens-austin-software-deve/240144235?cid=RSSfeed_IWK_authors <div class="inlineStoryImage inlineStoryImageRight"><a href="http://www.informationweek.com/big-data/slideshows/big-data-analytics/7-tips-on-closing-the-big-data-talent-ga/240012658"><img src="http://twimgs.com/informationweek/galleries/automated/895/01_BigD_Talent_Gap_tn.jpg" alt=" Big Data Talent War: 7 Ways To Win" title=" Big Data Talent War: 7 Ways To Win" class="img175" /></a><br /> <div class="storyImageTitle"> Big Data Talent War: 7 Ways To Win</div> <span class="inlinelargerView">(click image for larger view and for slideshow)</span></div>  In search of IT talent, Union Pacific, the U.S.'s largest railroad, is opening a software development center in Austin, Texas, that could employ up to 40 people. Union Pacific increasingly depends on tech talent for everything from <a href="http://www.informationweek.com/global-cio/interviews/union-pacific-delivers-internet-of-thing/240004930">developing analytics software</a> to running one of the largest privately owned telecom operations. <P> But the railroad also faces the challenge of how to <a href="http://www.informationweek.com/global-cio/interviews/tech-hotshot-want-to-work-at-a-railroad/240004931">recruit tech hot shots</a> into an industry and location that aren't top of mind for technologists. Union Pacific has centered its IT operations at its headquarters in Omaha, Neb. While Union Pacific has extensive internship and other outreach programs, Omaha is one of those "great place to raise a family" cities that can be tough to initially attract new talent. CIO Lynden Tennison says Union Pacific has been recruiting from Texas universities, but many candidates would prefer to live in Austin. <P> More companies in heavy industry and manufacturing will face a tech talent crunch as they increasingly become dependent on software and data analytics to run their companies or to embed software as part of their products. <P> <strong>[ The next great technology problems are out there in rail yards, power plants and farm fields. To drive tech innovation, <a href="http://www.informationweek.com/global-cio/interviews/silicon-valley-needs-to-get-out-more/240143972?itc=edit_in_body_cross">Silicon Valley Needs To Get Out More</a>. ]</strong> <P> <a href="http://www.informationweek.com/global-cio/recruiting/general-motors-picks-austin-for-500-job/240006925">General Motors</a> recently opened an Austin office that could employ up to 500 people in software development and other IT specialties. CIO Randy Mott is opening four such development centers around the U.S., in locations chosen specifically for the IT talent there. Ford and GE opened Silicon Valley offices in the past year. <P> Union Pacific has a lot to offer a technologist. The railroad does considerable custom development of software used in areas such as predictive analytics to anticipate equipment failures and to optimize logistics on its 32,000 miles of track. The company also develops a lot of the software-plus-hardware systems that are needed onboard to operate a train. <P> Union Pacific also is working on a lot of the same automation problems applied to trains that Google is researching for the self-driving car. For railroads, it's part of a Congressional mandate (called <a href="http://www.informationweek.com/global-cio/interviews/congress-20-billion-tech-mandate-make-tr/240004933">Positive Train Control</a>) to use technology to prevent accidents such as train collisions. <P> <i>Stay ahead of the eCommerce technology curve. Watch our webcast, Next Generation e-Commerce Strategies for B2B Sales and Marketing, to learn the strategies and tactics you can use to more efficiently give your clients what they want, keep them happy and increase sales. <a href=https://www.techwebonlineevents.com/ars/eventregistration.do?mode=eventreg&F=1005250&K=ECOMEAIBM">Register now</a>.</i>2012-12-07T09:06:00ZSilicon Valley Needs To Get Out MoreThe next great technology problems to solve are out there in rail yards, power plants and farm fields. If Silicon Valley is going to drive this "Internet of things," it needs to build closer ties with companies in established industries. http://www.informationweek.com/global-cio/interviews/silicon-valley-needs-to-get-out-more/240143972?cid=RSSfeed_IWK_authors<div class="inlineStoryImage inlineStoryImageRight"><a href="http://www.informationweek.com/big-data/slideshows/big-data-analytics/7-tips-on-closing-the-big-data-talent-ga/240012658"><img src="http://twimgs.com/informationweek/galleries/automated/895/01_BigD_Talent_Gap_tn.jpg" alt=" Big Data Talent War: 7 Ways To Win" title=" Big Data Talent War: 7 Ways To Win" class="img175" /></a><br /> <div class="storyImageTitle"> Big Data Talent War: 7 Ways To Win</div> <span class="inlinelargerView">(click image for larger view and for slideshow)</span></div>The industrial Internet, or what's more commonly called the "Internet of things," needs a new wave of innovation and invention to advance. Better analytics software, better sensors, new business models. If the Silicon Valley technology startup ecosystem is going to drive that invention, it needs to build closer ties with companies in established industries in order to understand their problems and opportunities. <P> Uber didn't arise because taxi companies called a conference to ask for technology to disrupt their industry. It started with three guys who had a problem calling a cab. So how do you let those "three guys" know about the everyday problems of running railroads, power plants, mines and farms? <P> We need ways for more people to tinker with industrial Internet problems without each industry's permission. Silicon Valley needs to figure this out, but so do established companies searching for the next wave of efficiency and revenue from technology. <P> <strong>[ Read <a href="http://www.informationweek.com/software/business-intelligence/how-to-find-strategic-advantage-from-big/240004983?itc=edit_in_body_cross">How To Find Strategic Advantage From Big Data</a>. ]</strong> <P> The industrial Internet promises to deliver that boost via machine-to-machine online connections -- putting sensors on equipment and infrastructure, including tractors, airplanes, electricity grids, medical systems and gas turbines, in order to collect data. Using analytical software to make sense of that data can let companies do things like predict when a jet engine part is starting to wear out and replace it long before it fails. <a href=" http://www.informationweek.com/global-cio/interviews/what-ges-15-trillion-industrial-internet/240142639 ">GE recently forecast</a> that the industrial Internet could add as much as $15 trillion in worldwide economic growth in the next 20 years. <P> Silicon Valley startups and venture capitalists will want their cut of that $15 trillion, but is the startup ecosystem sufficiently plugged in to these problems to work its magic? <P> Consider this advice <a href=" http://www.paulgraham.com/startupideas.html ">from investor Paul Graham</a>, from his recent essay on <em>How To Get Startup Ideas</em>, which anyone remotely interested in business innovation should read: <P> <em>"The way to get startup ideas is not to try to think of startup ideas. It's to look for problems, preferably problems you have yourself. The very best startup ideas tend to have three things in common: they're something the founders themselves want, that they themselves can build, and that few others realize are worth doing."</em> <P> The problem isn't that these industrial Internet problems are inherently harder because they involve sophisticated equipment such as power plants and jet engines. Consumer Internet companies such as Google and Facebook, with their massive-scale database, analytical and data center technology, connect with billions of people. That's what showed us that connecting hundreds of billions of machines and making sense of the data is possible. <P>   <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div>   <P> The risk is that people in the traditional startup talent stream: a) don't know what industrial problems exist; b) aren't jazzed by the problems (see Graham's "something the founders themselves want"); and c) don't see a big enough opportunity in solving those problems. <P> You get excellent Silicon Valley perspective on this challenge from an intriguing panel discussion <a href="http://www.youtube.com/watch?v=mMPlCGUeVHQ&feature=youtu.be">led by Tim O'Reilly</a> last week at a conference GE held about the industrial Internet. <P> On the subject of needing to know that problems exist, EMC chief strategy officer <a href="http://www.informationweek.com/cloud-computing/platform/emc-vmware-team-to-woo-cloud-developers/240143834">Paul Maritz</a> framed things this way. The first generation of Silicon Valley was plugged into enterprise IT needs and was wildly successful at automating companies' paper processes. The next generation pioneered the consumer Internet. Now the two worlds need to come together, to use the Internet to solve industry-specific problems. <P> But Silicon Valley lacks the deep industrial domain knowledge. "What we haven't had happen yet is the education of what does it mean to move a locomotive all the way from Long Beach to Chicago?" said DJ Patil, a former LinkedIn executive who's now data scientist in residence with the venture fund Greylock Partners.On the challenge of getting entrepreneurs jazzed about these industrial problems, O'Reilly sounded an optimistic note. "I love the idea that we have the chance to tackle big problems like healthcare and energy using the talent we have here," he said. O'Reilly thinks entrepreneurs will be motivated to make real products and established business models -- like taxis -- better. <P> But the business model could be one of the tougher nuts to crack. Accenture's Matt Reilly, also on the panel, noted that a lot of industry Internet investments will be around "micro" problems -- a big project by one company with a $1 billion capital investment. Those are harder to "open up," and the successes also won't create the next Internet star. "The revolution will not be televised. … It's about things that happen and you don't know," Reilly said. "It'll be about flights that are on time, luggage that got there, product that are on the shelf." <P> Industrial company CIOs worry that their technology challenges don't represent a big enough market for startups to tackle. For example, Union Pacific CIO Lynden Tennison lives the <a href="http://www.informationweek.com/global-cio/interviews/union-pacific-delivers-internet-of-thing/240004930 ">Internet of things</a>, as the company's sensors, spread across 32,000 miles of train track, take 20 million readings a day to provide an early warning when a wheel is at risk of failing. But Tennison ends up having his in-house IT team build a lot of UP's technology. The problem is that even if a technology vendor gets three-fourths of the railroad market, it's likely still a small business, so that startup needs to charge a lot for its products, and it's often on shaky financial footing. Not exactly your dream tech partner. <P> I've heard the same lament in other industries. UPS CIO Dave Barnes regularly works with startups and will even invest in the promising ones. In early 2009, Barnes told me how he was pushing vendors for faster data analysis so that UPS could be more responsive in creating driver routes. And this past year, UPS leveraged today's <a href=" http://www.informationweek.com/global-cio/interviews/ups-empowers-package-recipients/240006802 ">faster database and processing technology</a> to offer a service that lets customers change delivery instructions online on-the-fly, for an added fee. But like Union Pacific, UPS often has to build the technology itself. <a href="http://www.informationweek.com/ups-positioned-for-the-long-haul/212900815">Said Barnes</a> back in 2009: "If we believe in something and can't get someone to do it, we'll pave the path. But we aggressively look to partner." <P> GE and Ford both opened <a href=" http://www.informationweek.com/global-cio/interviews/ford-navigates-rough-road-of-software-de/232602132 ">Silicon Valley offices</a> this year with the stated goal of getting closer to startups and Internet-driven innovations. Such moves are great, but they're not enough. <P> The industrial Internet will thrive only if there are ways for entrepreneurs to experiment with new products and ideas without the industries' permission. We need people outside the system who solve problems the industry doesn't even know it has, or who expand on ideas the industry rejected or ignored. <P> A start is for industrial companies to share more of their data. GE, for instance, is launching a "quest" in which it will give people two months of flight information -- from flight schedules to wind data -- from the National Airspace System. The challenge is to create a predictive model to increase airline efficiency. It's proposing something similar for healthcare. <P> Even after we have freed up more data, though, we need something else: data jockeys. EMC's Maritz noted that it still takes a highly educated and talented specialist to make sense of these huge data sets. Consulting firms that specialize in big data are touting them as "god-like creatures called data scientists, there are 1,500 of them in the world, and we've already hired 1,000," Maritz joked. He makes the great point that we need tools that can "democratize" data analysis the same way we made programming something your average clever person could tinker with. <P> It's a long list of problems to solve, but problems are the gas that drives Silicon Valley. Although we lack sufficient connections today between the technology startup ecosystem and industrial industries, you can bet some firm already fancies itself the Y Combinator or Andreessen Horowitz of the industrial Internet. <P> Which takes me back to Paul Graham's post, and his advice that the way to look for startup ideas is to look for what's missing. Writes Graham: <P> <em>"Most things that are missing will take some time to see. You almost have to trick yourself into seeing the ideas around you. But you know the ideas are out there. This is not one of those problems where there might not be an answer. It's impossibly unlikely that this is the exact moment when technological progress stops. You can be sure people are going to build things in the next few years that will make you think 'What did I do before x?'"</em>2012-11-29T15:25:00ZGE Isn't Running An Industrial Internet Charity, FolksGE CEO Jeff Immelt expects strong revenue growth from new software products and services that tie machines to the Internet to allow better data analysis.http://www.informationweek.com/global-cio/interviews/ge-isnt-running-an-industrial-internet-c/240142916?cid=RSSfeed_IWK_authorsThe "industrial Internet" involves collecting data from machines in order to run analytics to use those machines better. It's an easy enough concept to grasp, but let's talk about the metric you really want to know -- can it drive revenue? <P> GE CEO Jeff Immelt on Thursday predicted that GE can grow its "dollars per installed base" by 4% to 5% annually by selling products and services that support this effort to use online data for better operations. GE did $36.3 billion in revenue last quarter. Immelt says GE has a "services backlog" of $150 billion that it will "leverage" to develop these industrial Internet products. What does that mean? It means GE has contracts that are performance based -- it gets paid based in part on whether the jet engine, power plant turbine, etc., is operating as promised. If data-driven analytics <a href="http://online.wsj.com/article/SB10001424127887323751104578147594272182354.html">keeps that equipment running, or cuts the costs of keeping it running</a>, it means more profit for GE. <P> We're talking about these numbers in part because GE is doing a lot of promotion this week about its concept of the "industrial Internet," with a big report on its potential economic impact and a live event in San Francisco. I'm discussing it with you, though, because it's one of the most essential strategic issues a CIO can address. Do connected devices -- whether they're customer smartphones or an MRI machine linked via Wi-Fi -- provide a new, critical connection to my customer or my operations, and a way to bring technology into the product my customer uses? If I don't create this connection, will someone else use it to take my customer? <P> GE thinks so. It just announced new product and services business to sell software and data management and analysis services into the key industries where it sells equipment -- starting with aviation, healthcare, energy and transportation. In aviation, it just started a joint venture with Accenture called Taleris to improve airplane operating efficiency by analyzing data to minimize downtime and waste. GE estimates a 1% cut in fuel use would save the airline industry more than $30 billion the next 15 years. <P> For more on what the industrial Internet needs to take off, check <a href="http://www.informationweek.com/global-cio/interviews/what-ges-15-trillion-industrial-internet/240142639">this article</a> from earlier in the week. <P> Two additional things to consider about the business opportunity from this industrial Internet -- or more broadly, the Internet of things that goes well beyond industrial uses. <P> One is that GE's steps to spur an ecosystem of development around this industrial Internet take a GE-centric view, focusing on the industries where it sells products. That means it's way too narrow. Think about agriculture, using moisture sensors to direct irrigation and thus use dramatically less water. It's happening on a small scale but could become essential and even required by law as water shortages grow. How about cars that talk with traffic lights, roads and other vehicles, so that traffic can move more efficiently and relieve the gridlock that plagues megacities from Mumbai to Sao Paulo. Whatever your industry, you're likely to see ways the competitive and regulatory landscape will change. <P>   <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div>   <P> Lastly, GE is playing defense as well as offense. Some $15 trillion of economic growth and 4% more dollars per installed base sound lovely, but the Internet of things will destroy businesses, companies and jobs as surely as it creates them. Would better usage data reveal that your customers under-utilize their machines, so they actually could buy 25% less if they used them efficiently? Do you rely on break-fix services revenue that could be wiped out by data-driven preventative maintenance? Do you sell extended warranties that could be made obsolete? And I'm certain your doomsday scenarios would be much scarier than mine. <P> These problems and opportunities point to the need for CIO leadership in helping companies take part in this emerging innovation ecosystem around the Internet of things.2012-11-28T08:00:00ZA Proposal For IT: Set Just One Goal For 2013Be measurably more relevant to your customers.http://www.informationweek.com/global-cio/interviews/a-proposal-for-it-set-just-one-goal-for/240142445?cid=RSSfeed_IWK_authorsIf I've set a really good goal for myself, and I stop to think about what it'll take to get there, it creates a physical reaction. A long exhale. A few sleepless hours. A queasy feeling in the gut.</p> <P> It's a physical reaction to what my brain is saying about the goal. Can I really do it? Can I change the actions I take every day, that I've been doing for years, in all the ways needed to accomplish this new goal? Will the toil and expense pay off? Is it even the right goal?</p> <P> 'Tis the season for setting goals and priorities for the year ahead. This time, rather than creating a short list of priorities, IT leaders might consider setting just one goal. And if it's only one, that goal should be one that makes you at least a little uncomfortable to think about. </p> <P> So here's what I propose for 2013: Make IT measurably more relevant to your customers. I'm talking about end customers, the people or companies that buy our stuff -- not IT's internal customers, a.k.a. employees. Following are three avenues to do that. </p> <P> Understanding customers: Companies always have craved information about their customers. What's different today is the potential to predict consumer behavior with greater accuracy. Better analytics and the ability to more affordably crunch huge amounts of data create this opportunity. </p> <P> This "understanding customers" category might sound like the safest, easiest way for IT to get closer to customers -- just watching and analyzing. But it doesn't stop there. Yes, customer data helps you run the business internally, but would big data analysis help the customer even more if you gave it away? This is the classic FedEx breakthrough -- package tracking was an essential internal tool, but sharing package status transformed customer relationships in the industry.</p> <P> Sharing your analysis with customers can get uncomfortable. I talked with a CIO whose company shared usage data with one customer, only to have that company conclude it should buy less. The customer was underutilizing what it had. Not only might customers not thank you for the data, they might ask why you sold them that last unit and how long you've had these insights. It's a moment that tests what "partner" and "long-term relationship" really mean.</p> <P> In consumer products, predicting behavior based on social media sentiment is a new opportunity. Can social media predict success of a new product launch, and even help steer production levels and reduce stockouts? Can social media analysis spot new product ideas or get customers involved in product development? 2013 will be a year of experiments, embarrassing failures and early successes in social media analysis. </p> <P> Promotions for customers: Once IT has created a better understanding of customers, the next step could be improving promotions. A big reason marketing is increasing spending on technology is to make promotions more data-driven and efficient. But there's a long way to go in customizing them.</p> <P>   <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div>   <P> Data-driven customization is fraught with risk. Just because people sign up for a loyalty card doesn't mean they want a stream of promotions. I love my bike and skis and wouldn't mind hearing more from the companies that make them, but I never need to hear from my coffee company. Does your data make those distinctions?</p> <P> Sears is an innovator in using Hadoop to mine big data for customer insights, and it's in the early stages of applying that to promotions. Big-box retailers need to test more customized, real-time promotions to compete with online stores. But when I wrote about Sears' efforts, this note from a reader warned of the risks: "I think that retailers may have forgotten that the customer is a person that does not always make logical decisions, but will hold grudges."</p> <P> Products for customers: The ultimate customer-facing role is to help drive technology that the customer actually uses. From Ford to Nike to Royal Caribbean, companies across industries increasingly embed tech in products and services to differentiate them. Building customer-facing products often takes higher quality and faster development than IT is used to for internal projects, so don't underestimate the cultural change required. Mobile apps have accelerated this trend, giving companies a new way to interact with customers. Those apps also create a new data source, which brings us full circle to understanding customers.</p> <P> We're living through a historic shift that makes technology more important -- in fact, indispensable -- to building close customer ties. IT leaders can seize the moment by ruthlessly focusing 2013's goals on the customer who buys their products. </P> <P>  <center> <div id="printfeaturePDFpromo"><div class="printfeaturePDFCover"><a href="http://reports.informationweek.com/abstract/18/9395/Mobility-Wireless/informationweek-december-3-2012.html?k=axxe&cid=article_axxe_os"><img src="http://twimgs.com/infoweek/1352/smallcov2.jpg" alt="InformationWeek: Dec. 3, 2012 Issue" title="InformationWeek: Dec. 3, 2012 Issue" /></a></div> <div class="printfeaturePDFCopy"><strong><a href="http://reports.informationweek.com/abstract/18/9395/Mobility-Wireless/informationweek-december-3-2012.html?k=axxe&cid=article_axxe_os">Download a free PDF of <nobr><em>InformationWeek</em> magazine</nobr></a><br /> (registration required)</strong></div> <div class="clearBoth"></div> </div> </center> 2012-11-27T13:11:00ZWhat GE's $15 Trillion Industrial Internet NeedsGE makes the case that a more business-oriented 'Internet of things' will spur a productivity boom. Not so fast.http://www.informationweek.com/global-cio/interviews/what-ges-15-trillion-industrial-internet/240142639?cid=RSSfeed_IWK_authorsHere's a stat sure to become PowerPoint porn in the months ahead: General Electric predicts that the "industrial Internet" could add $10 trillion to $15 trillion to the world economy in the next 20 years. <P> Indeed, $15 trillion is a "wow, that's big" number sure to be dropped into many a presentation, but it's not the most important part of <a href="http://files.gereports.com/wp-content/uploads/2012/11/ge-industrial-internet-vision-paper.pdf">GE's major new report</a> on its industrial Internet vision. The most important part is why GE would bother to calculate this projection and issue such a report. The reason -- beyond the marketing value -- is that GE needs a whole lot of help from other vendors, regulators, financiers and users of technology before this vision and its $15 trillion payoff can come true. This report looks like an attempt to rally an ecosystem. <P> GE describes an industrial Internet where the machines it makes, such as jet engines, power plant turbines and MRIs, constantly gather data and send it along over the Internet for analysis. The data might alert people to take action, like replace a part that's close to wearing out, or tell a machine to automatically take an action, like slow down a turbine that isn't needed. The idea's more broadly discussed as the "<a href="http://en.wikipedia.org/wiki/Internet_of_Things">Internet of things</a>." <P> GE created the report in part because the whole idea of Internet innovation is under attack, says co-author and GE chief economist Marco Annunziata, and "we thought it was important to challenge this view." The report cites Northwestern University professor Robert Gordon for his view that the "innovations of the Internet Revolution are simply not as transformative as those of the Industrial Revolution." People think of the Internet's impact as centered on entertainment and social networks, Annunziata says. That's why GE spends much of the report trying to quantify the industrial Internet's potential in terms of economic and productivity growth. <P> But this industrial Internet needs a lot of technical and regulatory pieces to expand at the scale GE envisions. Based on my reading of the report, my interview with Annunziata, and <em>InformationWeek</em>'s reporting on the Internet of things throughout this year, I think the following changes must happen for GE's growth vision to become reality. <P>   <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div>  <strong>Analytics Must Get Better</strong> <P> This is No. 1 on Annunziata's list of required technology advancements. The cost of sensors is dropping, and the reach of wireless and wired Internet is expanding. It's getting cheaper and easier to gather and transmit data. Data analytics capabilities must improve "to make sure the data that comes available can be used in a productive way," Annunziata says. In GE's report, he describes this capability as "harnessing the power of physics-based analytics, predictive algorithms, automation and deep domain expertise" to know how machines and systems operate. <P> Startups and established vendors are developing big data analytics to make sense of the Internet of things, and do so quickly enough to make a timely business decision. GE's own software unit is among them. In <a href="http://www.informationweek.com/global-cio/interviews/union-pacific-delivers-internet-of-thing/240004930">an article</a> earlier this year, here's how we described one technology problem GE software is working on, that of combining real-time data and what-if scenarios: <P> <em>What GE wants to offer is the ability to ask, "Has any machine in our entire system ever had X, Y and Z factors, and what happened four hours later?" GE's systems today would take about 30 days to answer that question -- if they could even answer it. GE's working to combine its data management and analytics software with Hadoop-based data processing to deliver an answer in 30 seconds.</em> <P> <strong>Automation Must increase</strong> <P> As companies collect more data from more sources and then try to make faster decisions with it, the complexity soon exceeds humans' ability to keep up, Annunziata says. People must continue to oversee the process, he says, but more machines need to automatically take actions. Automation requires more embedded technology and, back to analytics, better decision-making software. Automation also points to the dark side of the industrial Internet: Doing it right means destroying a lot of manual jobs and betting that economic growth creates enough new ones.<strong>People Need New Skills</strong> <P> Annunziata highlights three new job growth areas: skills that cut across traditional lines of engineering and software development, creating a new role like a "digital-mechanical engineer"; data scientists, who specialize in fields from cybersecurity to pattern recognition to data visualization; and user interface experts, who can design human-machine interfaces that make a job easier and people more productive. We recently wrote about how <a href="http://www.informationweek.com/global-cio/recruiting/why-ford-courts-electrical-and-software/240062659">Ford is recruiting</a> more electrical and software engineers to do this kind of engineering-plus-design work for its cars, as software becomes a bigger part of why people buy a vehicle. As cars get more connected, such as sharing data car-to-car to know if there's an accident or traffic jam ahead, these skills get more important. Companies such as GE and Ford need universities to start training such specialists. <P> <strong>Policymakers And The Public Must Be Convinced</strong> <P> How much machine automation should people allow? We see this debate beginning around <a href="http://www.informationweek.com/government/policy/google-autonomous-cars-get-green-light-i/240008033">Google's self-driving car</a>. In financial markets, automated high-speed trading creates controversy at times such as the "<a href="http://www.wallstreetandtech.com/technology-risk-management/flash-crashes-kill-switches-and-10-milli/240010032">flash crash</a>," when markets seem to overreact. <P> The risks are real, Annunziata says, so we need "transparent public debate on how much control we are giving to machines." Cybersecurity also becomes of vital public importance when it relates to networked power plants, jet engines and healthcare equipment. GE argues for cybersecurity regulation that's less fragmented across states and countries. Again, it points to why GE needs to make a case that the risks and economic disruption of a more networked and automated business world will pay off in economic growth. <P> <strong>Companies Must Invest</strong> <P> GE's report focuses mostly on macroeconomics. Getting the U.S. economy back to the 3.1% productivity growth rate of the 1995 to 2005 Internet boom, rather than the 1.6% rate since then, drives its prediction of $10 trillion to $15 trillion in economic growth from the industrial Internet. <P> But investing in the industrial Internet is a microeconomic issue -- companies make this decision one by one, project by project. <a href="http://www.nytimes.com/2012/11/24/technology/internet/ge-looks-to-industry-for-the-next-digital-disruption.html"><em>The New York Times</em></a>, in writing about GE's industrial Internet concept, cited an example of a wind farm operator upgrading the sensors and optimization software -- and netting a modest 3% energy output gain. <em>InformationWeek</em> wrote about Union Pacific's system to monitor train wheels and use analytics to predict failures, leading to a 75% drop in wheel-related derailments, but the next level of investment and innovation hinges on more effective sensors, better predictive analytics and better data sharing to predict the effects on the entire rail network. <P> The decision by companies whether to invest in this technology brings us back to the need for better analytics, more automation and new skills, factors that will drive the ROI of these Internet of things projects. We are seeing companies take these steps and make incremental gains with networked machines. But we need an innovation ecosystem to kick in to get anywhere near GE's $15 trillion vision. <P>  <center> <div id="printfeaturePDFpromo"><div class="printfeaturePDFCover"><a href="http://reports.informationweek.com/abstract/83/9496/IT-Business-Strategy/informationweek-december-17-2012.html?k=axxe&cid=article_axxe_os"><img src="http://twimgs.com/infoweek/1354/smallcov2.jpg" alt="InformationWeek: Dec. 17, 2012 Issue" title="InformationWeek: Dec. 17, 2012 Issue" /></a></div> <div class="printfeaturePDFCopy"><strong><a href="url_to_come">Download a free PDF of <nobr><em>InformationWeek</em> magazine</nobr></a><br /> (registration required)</strong></div> <div class="clearBoth"></div> </div> </center> 2012-11-13T08:40:00ZWhy Ford Courts Electrical And Software EngineersFord CTO Paul Mascarenas discusses the company's challenges in recruiting and in developing products, as software becomes more critical to differentiating its cars and trucks.http://www.informationweek.com/news/240062659?cid=RSSfeed_IWK_authorsFord the automaker is celebrating its double identity as a software company, heralding the 5 millionth vehicle sold carrying the SYNC in-vehicle software. <P> For a reality check on how hard it is to embrace software development, listen to Ford CTO Paul Mascarenas. In the video below, Mascarenas discusses two big challenges: recruiting talented software developers and engineers, and meshing the "that's-so-six-months-ago" mobile software mentality with the years-long process needed to design a new car. <P>  <P> <div style="display:none"> Informationweek.com run-of-site player, used to publish article embedded videos via DCT. The same ads will be served on this player regardless of embed location. </div> <P>  <P> <script language="JavaScript" type="text/javascript" src="http://admin.brightcove.com/js/BrightcoveExperiences.js"></script> <P> <object id="myExperience1880918296001" class="BrightcoveExperience"> <param name="bgcolor" value="#FFFFFF" /> <param name="width" value="480" /> <param name="height" value="270" /> <param name="playerID" value="1223625539001" /> <param name="playerKey" value="AQ~~,AAAAAF14eAc~,GZC-YoxXnehVitUBmX0u2QYfPEVvZG_k" /> <param name="isVid" value="true" /> <param name="isUI" value="true" /> <param name="dynamicStreaming" value="true" /> <P> <param name="@videoPlayer" value="1880918296001" /> </object> <P>  <script type="text/javascript">brightcove.createExperiences();</script> <P>  <P> Ford noted its <a href="http://gigaom.com/2012/11/05/if-you-think-your-car-is-smart-and-connected-now-just-wait/">5 million mark </a> last week with its SYNC development partner, Microsoft. But earlier this fall, Mascarenas talked in-depth with InformationWeek 500 conference attendees about the challenges Ford still faces in the journey to <a href="http://www.informationweek.com/global-cio/interviews/why-ford-just-became-a-software-company/231902920"<http://www.informationweek.com/global-cio/interviews/why-ford-just-became-a-software-company/231902920%22>become a software company</a>. <P> Companies in a range of industries will face this same software challenge as they create customer-facing technology, from embedded software like Ford's to mobile apps. Here are two key excerpts: <P> <strong>On recruiting development talent:</strong> "Electrical engineers coming out of college aren't really thinking about the auto industry in the way we would like to have them thinking about the auto industry," Mascarenas said. <P> He singled out electrical engineers because that skill is in particularly short supply. Ford is trying to get graduating EEs to think of a carmaker as a place to go to create zippy customer-facing experiences, not just to build systems that run antilock brakes and windshield wipers (although carmakers need those, too). <P> Ford faces the same challenge in recruiting other technical talent, from software developers to "human-machine interface" designers. In particular, Mascarenas sees growing demand at Ford for controls engineering, software engineering and core electrical engineering. <P> <strong>On the pace of development with software:</strong> When Ford comes out with a new vehicle, such as its redesigned <a href="http://www.ford.com/cars/fusion/">Fusion </a> and <a href="http://www.ford.com/suvs/escape/">Escape</a> models this year, the mechanical features have been locked down for about two years in order to get them tested for quality and safety and to set up factories to build them. With software features tied to SYNC, Ford can make changes less than a year before launch. <P> Ford needs to move at least that fast to keep its software from looking stale since SYNC's interface will be compared with Android smartphones, iPhones and tablets that evolve at least every year. SYNC lets drivers do things like interact with apps on their smartphones using voice commands. Ford has an ongoing challenge, Mascarenas said, to mesh in these faster-changing features and technology into what is still a longer, more traditional product development cycle for the vehicle itself. <P> Ford grabbed an early lead in in-vehicle electronics, but all its competitors now offer voice controls and integration with smartphone apps. In the video below, Mascarenas discusses the new pace of competition at Ford as both a maker of cars and trucks and as a software and consumer electronics company. CIOs across industries will have to learn to live with a similar dual identity. <P> <i>InformationWeek is conducting our annual Outlook Survey to explore how IT leaders are planning their priorities and budgets for 2013. The results of the survey will appear in an upcoming issue as well as in an in-depth report. Take our <a href="http://informationweek.Outlook2013.sgizmo.com/s3/">InformationWeek 2013 Outlook Survey</a> now and enter to win one Samsung Series 5 Chromebook. Survey ends Nov. 19. </i>2012-11-07T09:06:00ZHow Do You Survive The Innovation Hamster Wheel?This is how two tech leaders do it, and we'd like to hear more tactics from you.http://www.informationweek.com/thebrainyard/news/240049890?cid=RSSfeed_IWK_authorsIt really isn't ever going to stop, is it? You had that great idea. You aligned, crowdsourced, socialized, got buy-in, managed change, transformed ... Name it, and you did what was needed to push from brainstorm idea to business success. <P> Time to do it again. Now what have you got? <P> We talk a lot about tech-driven innovation, but we should acknowledge that what IT and other business leaders want to do just isn't natural. Yes, everyone wants to work on new and exciting projects. But then most normal people want to settle back into some steady state. People resist the notion of constant innovation, of constant disruption and change. We did that big-change thing. Aren't we done? <P> It's why CIOs need some process for innovation, some formal way not only to keep disruptive ideas coming, but to guide them safely through the gauntlet of ways companies can kill even great ideas. <P> <strong>[ Gather more good ideas. See <a href="http://www.informationweek.com/global-cio/interviews/6-bright-ideas-found-at-a-tech-conferenc/240008433?itc=edit_in_body_cross">6 Bright Ideas Found At A Tech Conference</a>. ]</strong> <P> Richard Thomas, the CIO of Quintiles, which provides services to pharmaceutical and biotech companies to help them run clinical trials, has a somewhat unusual way of keeping innovation in the pipeline. "We passionately believe in giving our ideas away," Thomas said at the <em>InformationWeek 500</em> Conference in September. (Watch the <a href="http://www.informationweek.com/global-cio/interviews/is-its-core-competency-making-others-loo/240009362">video of Thomas' presentation</a>.) <P> Thomas pushes his IT team to come up with what he calls "game changing" ideas: IT-powered new products that drive revenue, or process improvements that reduce costs significantly. Once IT has that great idea, however, Thomas looks for the right business unit to partner with and lets that business unit champion it and carry it forward. <P> For example, Quintiles has worked for three years on a project called Semio, with partner and customer Eli Lilly. Semio is a collaborative environment that pharma companies can use to examine healthcare data to design the best approach to a clinical trial, balancing the cost, time and chance for success. To develop that project, Thomas teamed his IT pros with Quintiles business unit experts and Eli Lilly experts; those business experts led three of the four technical development teams. <P>   <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div>   Giving away ideas isn't always easy for ambitious IT folks to swallow. But Thomas doesn't want to build a fiefdom of products that he and his IT team run on an ongoing basis. He's creating an engine for producing those ideas and partnering with others to get them done. <P> If IT hands off projects once they're built, that keeps a certain pressure on his team to come up with the next game-changing idea -- and to stay in this world of constant change. "New IT is definitely not for everyone," Thomas warned. "It's a bit out there, and it's not certain what it will look like when it's finished, especially with some of these game-changing types of initiatives." <P> <Strong>Innovation Blitzes</strong> <P> Allstate has its own way of keeping the innovation wheel spinning. For the past five years, an innovation team run out of the IT organization has worked with business units to figure out the company's biggest problems and then rally employees to generate ideas to solve them. <P> It started out with plenty of doubters. Matt Manzella, Allstate's director of technology innovation, remembers how the innovation team wanted chairs that were a different color from those used elsewhere at Allstate, to send a small visual cue to visitors that they're doing something different in that area. A facilities manager balked. "She said, essentially, 'When you fail in a year, we need to redeploy those chairs,'" Manzella said at the <em>InformationWeek 500</em> Conference. (<a href="http://www.informationweek.com/global-cio/interviews/allstate-shares-hard-lessons-in-driving/240012728"> See Manzella's presentation</a>.) <P> Allstate runs two or three "innovation blitzes" a month -- online brainstorming sessions aimed at a specific problem, using software from Spigit to vote ideas up and down and marshal comments. The innovation team works with business units to frame those problems, so when good ideas come in there's a receptive audience. <P> <i>InformationWeek</i> is looking to profile more of these organized innovation efforts, so if you have a system that works, we'd love to hear from you. (I'm at <a href="mailto: cjmurphy@techweb.com">cjmurphy@techweb.com</a>, or on Twitter <a href="https://twitter.com/Murph_CJ">@murph_cj</a>). <P> What matters isn't the exact approach. Other companies tackle innovation in a more ad hoc way, pulling SWAT teams together with only a very small central team for support. Some companies hold annual innovation fairs. What does matter is having a system for innovation that the company recognizes and fits the company culture. Having such an effort acknowledges that continuous, disruptive innovation, while an unnatural act, is nonetheless critical to keeping companies and products from stagnating.2012-11-05T10:09:00ZElection 2012: Where Are The PowerPoint Slides?Our presidential candidates act like they're campaigning in 1912, not 2012. Did Ross Perot ruin charts forever?http://www.informationweek.com/news/240044403?cid=RSSfeed_IWK_authorsI figured it out. I figured out how in one small step the candidates could make the 2016 presidential campaign more informative and effective: Use PowerPoint. <P> I mean it. If you were making a bet-your-career business pitch, wouldn't you work up a few killer PowerPoint slides, at a minimum? <P> I'd guess pretty close to 100% of you would, if not a more elaborate, data-intensive multimedia presentation. But Mitt Romney and Barack Obama didn't have enough cash to whip up a deck of slides? In the business world, I hear executives constantly telling me they're trying to make more data-driven decisions. CIOs are creating dashboards that help employees visualize data so they know what action they should take. So why is it that Mitt Romney and Barack Obama almost never push charts on us to try to sway our votes? <P> The economic issues at the heart of this election are custom-made for data slapped up on a PowerPoint presentation. Governor Romney wants to show the economy is worse off than it was four years ago and is trending in the wrong direction. President Obama wants to show that the country was saved from ruin and is on the upward swing of a recovery. Show us. <P> And the deficit and debt? Never has an issue been more custom-made for a chart-aided discussion. The numbers are so astronomical they're hard for us to get our heads around, so help us picture the problem and what our government will look like when you're done. <P> The worst in me suspects two big reasons. One is that the campaigns think we're too stupid. Data and charts will confuse voters and won't have a meaningful impact on our decisions. I get that the campaigns focus on emotions as much as policies, feelings as much as performance. But in a razor-tight election, isn't there a niche here? The independents, the Latino vote, suburban women -- and the data-driven voter! <P> The second reason I fear is that numbers and charts are too concrete. Once you put numbers to page, they can be used against you. Numbers are harder to "walk back" when it turns out they don't play well in the polls. "Let me show you the chart put up by my opponent … " <P> Or maybe I'm too cynical, and the dearth of PowerPoint slides and charts is nothing more than a decades-long Ross Perot hangover. Remember the charts he brought to his campaign -- and the Saturday Night Live <a href=" http://www.hulu.com/watch/4266">spoofs</a> they launched?   <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div>   <P> I'm no political pundit. I'm just a voter in a swing state (Wisconsin) who has watched the debates, convention speeches, and so many rival-bashing campaign ads that I think I can recite some word for word. So next year we voters should insist, like a 6th grade teacher making a public speaking assignment, that each candidate show at least three charts to support his or her argument. <P> Or perhaps I should just hope for this: Whoever gets into office will try a chart or two as he explains to us what he’s going to do about all of these problems we've been hearing about. <P> <i>Download the new issue of <a href="http://www.informationweek.com/gogreen/101512mr/?k=axxe&cid=article_axxt_os">Must Reads</a>, a compendium of our best recent coverage on IT-as-a-service. It includes articles on cloud computing myths, how to build an IT service catalog, security problems, and more. (Free registration required.)</i> <P>2012-11-05T09:06:00ZAllstate Shares Hard Lessons In Driving InnovationCreating an innovation group was a small step. Learning from rejection and winning over skeptics was the real challenge.http://www.informationweek.com/thebrainyard/news/240012728?cid=RSSfeed_IWK_authorsAllstate has spent more than five years honing a formal approach to innovation. It hasn't always gone smoothly -- insert <a href="http://www.allstate.com/mayhem-is-everywhere.aspx">Mayhem</a> joke here -- but director of technology innovation Matt Manzella doesn't hide from the hard lessons he has learned. <P> Manzella shared his experience at the recent <i>InformationWeek 500</i> Conference, and you can view his presentation below. Here are a few of the lessons I took away: <P> <strong>Focus On The Burning Issues</strong> <P> When Allstate's innovation lab started, it was a place where people could offer ideas, and the lab staff would pursue the ones it considered most interesting. <P> "We had a lot of orphaned ideas," Manzella said. "People would drop them off and not really want to work on them." Even if the lab took them up, when it would bring an idea or prototype to a business unit, "we heard 'no' a lot." Business unit leaders weren't involved in honing the idea, so they weren't interested in implementing it. <P> <strong>[ Learn more about Allstate's innovation lab. See <a href="http://www.informationweek.com/global-cio/interviews/allstate-quintiles-succeed-with-new-it-r/240007103?itc=edit_in_body_cross">Allstate, Quintiles Succeed With New IT Rulebook</a>. ]</strong> <P> Now the innovation lab works almost exclusively with a business unit. It does "innovation blitzes" -- 10-day sprints to solicit employee input on a business problem, using an online tool for commenting and voting. The questions posed in the blitz are honed with business unit leaders to make sure they're aimed at the biggest problems or opportunities. <P> <strong>Expect Rejection; Don't Give Up</strong> <P> One of the biggest skeptics of the innovation blitz idea initially was the claims department, Manzella said. Its leaders' concerns were purely practical: The department has thousands of employees on the phones, and their time is closely monitored to make sure the group runs as efficiently as possible. How would it account for time spent "ideating?" <P> Now the claims department is one of the biggest advocates of the blitzes. A turning point was from one idea, which got 500 "up" votes and hundreds of comments in the blitz system, that saves the department about $18 million a year. One accommodation: The claims department has branded its innovation blitzes "Gold Mine" so that claims people know that it's discussing topics relevant to their roles. <P>   <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div>   Manzella's advice still holds: "If you're going to work on an innovation team, you better have a thick skin. Because you're going to hear 'no' a lot." <P> <strong>Get Executive Support</strong> <P> Brainstorming of the kind Allstate is doing just won't work unless employees know that it's OK to take time to contribute, and that their bosses expect them to. Manzella recalled how in one of the earlier idea-generating efforts, one that involved a big investment of time, some employees took time off because they weren't sure it would be OK to contribute on the clock. On the flip side, when one group ran its first blitz, the group's president passed through the cafeteria asking: "Have you put an idea in the blitz?" Executives need to comment in the tool as well. <P> It ties back to that focus on burning problems: Work on the right questions, and get people involved who have the budget and influence to move things forward. <P> <strong>Acknowledge The Effort</strong> <P> People want to know that their ideas are being considered, or they won't keep contributing. But Manzella doesn't think that requires cash rewards or prizes. Allstate did offer a chance to win an Xbox console with its first blitzes, and some people gamed the system to win them, Manzella said. Now they're focused on leader boards that offer recognition for ideas that get many votes and comments, and for top contributors. <P> For more details on Allstate's experience, view Manzella's presentation here: <P>  <div style="display:none"> Informationweek.com run-of-site player, used to publish article embedded videos via DCT. The same ads will be served on this player regardless of embed location. </div>  <script language="JavaScript" type="text/javascript" src="http://admin.brightcove.com/js/BrightcoveExperiences.js"></script> <object id="myExperience1886968215001" class="BrightcoveExperience"> <param name="bgcolor" value="#FFFFFF" /> <param name="width" value="480" /> <param name="height" value="270" /> <param name="playerID" value="1223625539001" /> <param name="playerKey" value="AQ~~,AAAAAF14eAc~,GZC-YoxXnehVitUBmX0u2QYfPEVvZG_k" /> <param name="isVid" value="true" /> <param name="isUI" value="true" /> <param name="dynamicStreaming" value="true" /> <param name="@videoPlayer" value="1886968215001" /> </object>  <script type="text/javascript">brightcove.createExperiences();</script> 2012-11-01T11:35:00Z6 Surprises About IT Hiring PlansMobile is a hot skill that might not get you hired. Check out this and other surprising glimpses from our newest IT staffing survey data.http://www.informationweek.com/news/240012679?cid=RSSfeed_IWK_authorsThe IT hiring picture is looking OK. Comparing their IT organizations to a year ago, 47% of the 1,391 business technology pros who responded to <em>InformationWeek</em>'s 2012 State of IT Staffing Survey said staffing increased, 35% saw no change, and 18% saw a decrease. But IT isn't a monolith; demand varies widely by specific skills. Here are six staffing areas where interesting trends popped up in our survey. <P> <strong>1. Mobile's A Hot Skill But Might Not Get You Hired.</strong> <P> It's not that there's a surplus of mobile talent -- 51% of survey respondents think it will be hard to find the talent their companies need. But instead of hiring, most companies will retrain employees: Just 17% of respondents say their companies will rely mostly on hiring, one of the lowest percentages among 15 skills covered in our survey, while 57% rely mostly on retraining. (The rest are a mix of the two.) <P> Retraining can make sense because industry and company knowledge are so valuable in creating mobile apps. That's the approach Waste Management took last year, for two main reasons: Mobile developers who understand enterprise IT were almost impossible to find, and the company found that quality Java programmers could quickly learn Android development and were energized by the opportunity. <P> <strong>2. For Social And Collaboration Projects, New People Aren't Needed.</strong> <P> Many social networking and collaboration projects are happening, but there's not a lot of hiring to get them done. Just 6% say social/collaboration is among their companies' top two hiring priorities, tied for last among 15 areas. Among companies looking for social/collaboration skills, just 16% will rely mostly on hiring to meet the need, which is tied for the lowest mark. And they don't expect stiff competition for talent: Just 16% of companies looking for social/collaboration pros think salary demands will be too high, the lowest percentage of any job category. <P> <strong>[ Want all our IT Staffing survey data? <a href="http://reports.informationweek.com/abstract/166/9136/Professional+Development+and+Salary+Data/research-2012-state-of-it-staffing.html?itc=edit_in_body_cross">Download our full report</a>. ]</strong> <P> <strong>3. For Big Data Analytics, Companies Look Outside.</strong> <P> Companies aren't adding lots of big data analytics staff -- 12% of companies put it among their top two staffing priorities, middle of the pack. But among those companies looking for analytics talent, 53% think it will be hard to find -- the highest hard-to-find percentage among the staffing areas in our survey. And 27% think those pros' salaries will be beyond their means. With talent hard to find and unaffordable, the 28% planning to rely on hiring are probably kidding themselves. Another 39% will rely mostly on retraining, and 33% a mix. <P> Big data analytics is a new role at many companies, so some might not know what they need. A Ph.D. in statistics? An expert in Hadoop? What they really need are intangibles, like a knack for spotting patterns in data and framing relevant questions. "It's absolutely important to groom your talent internally when you get started," said Neeraj Kumar, a VP at Cardinal Health who is working on its big data efforts. "You will not find resources outside." <P> <strong>4. Security Hiring Is Strong -- And Still A Manual Task?</strong> <P> <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"><div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"><a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a><div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div><span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span></div> </div>   <P> Security is among the top two staffing priorities for 17% of companies, tied for second in our survey. No doubt information security remains an indispensable priority, but shouldn't staff size be leveling off? The threats aren't getting less severe, but we should be making progress in automating more manual IT security tasks -- the monitoring, processing, and alerts. Only 39% say security people will be hard to find, well below other specialties. <P> <strong>5. Help Desk Is A Priority, But For The Wrong Reasons.</strong> <P> End user support/help desk ranks high among staff growth areas -- 16% put it in their top two, making it fourth. (It's also No. 1 on the list of likely cuts among companies cutting.) Half of companies will rely mostly on hiring to fill those needs, only 28% on retraining, and the reasons aren't good when it comes to career and salary prospects. First, companies consider help desk skills plentiful -- 46% say they're easy to find, the highest of any category. Second, people inside a company are unlikely to want to retrain and shift to support, because of its relatively low pay. <P> A few companies are trying to make IT support more appealing. Accounting firm BDO USA made its help desk responsible for creating wiki content on tech topics, and it coaches high performers in leadership. Both Intuit and Starbucks created a help desk modeled after the Apple Genius Bar, where customers can walk up with a support problem. <P> <strong>6. App Dev Rules.</strong> <P> Application development is the biggest staff growth area, with 25% putting it among their top two areas. That's promising. Companies need to shift IT firepower to new project development and away from run-the-business IT operations, and app dev tends to be about new project work. It's also a promising sign for economic growth -- companies don't add developers unless they're building new products or supporting new initiatives. <P> <i>InformationWeek Healthcare brought together eight top IT execs to discuss BYOD, Meaningful Use, accountable care, and other contentious issues. Also in the new, all-digital <a href="http://www.informationweek.com/gogreen/073012hc?k=axxe&cid=article_axxt_os">CIO Roundtable</a> issue: Why use IT systems to help cut medical costs if physicians ignore the cost of the care they provide? (Free with registration.) </i>2012-10-31T08:00:00ZShould Sears CTO Be Building A Tech Startup?Definitely, if it helps drive needed change at the retailer. If it's a distraction, Sears is doomed.http://www.informationweek.com/news/240009700?cid=RSSfeed_IWK_authorsGiven all of the headwinds Sears faces, should its CTO be spending much of his time building a startup? Sears Holdings had operating losses four of the last five quarters. Sears chairman Eddie Lampert, whose hedge fund owns more than 60% of the company, started his chairman's letter back in February with this assessment: "Our poor financial results in 2011, culminating in a very poor fourth quarter, underscore the need to accelerate the transformation of Sears Holdings." <P> In that environment, launching a technology startup is risky, given the potential for distraction from meeting the IT needs of a $42 billion-a-year retail business that includes Sears and Kmart. With the MetaScale venture, CTO Phil Shelley is looking to take advantage of Sears' broad experience with using the Hadoop big data platform. MetaScale sells subscription services to manage large data sets using Hadoop, and it offers big data consulting.</p> <P> Shelley doesn't see such a startup as risky. Lampert, he says, sets the expectation that executives need to make such moves. "It's a very innovative environment," Shelley says. "The concept of generating new business, a new business model, a whole new business, is very much encouraged."</p> <P> Sears is doing cutting-edge work when it comes to Hadoop and big data management. Some of the most practical work--work that other big companies might buy as a service--is moving big batch processing data loads off of mainframes, cutting hours of processing time. Applied to Sears' own business, eliminating mainframes could save tens of millions of dollars.</p> <P> But when it comes to applying big data tactics to change Sears, it feels like Sears could be doing more and moving faster. One of the most promising areas is for customized marketing promotions, using Sears' growing loyalty card program to know what customers bought in the past and what they're now buying, and to give them an intensely relevant offer to get them to buy more. Sears is just beginning to do that kind of personalization at scale.</p> <P> "You're starting to see that much more personal, targeted, digital engagement," Shelley says. "It's a big company to change, so it will take awhile, but it is changing."</p> <P> A critical advantage of Hadoop, Shelley says, is its ability to let companies keep and analyze all of their data. Whereas Sears used to analyze 10% of data on customers to figure out which promotions might work, now it can analyze all data on them. Because it's cheaper and faster to keep and analyze data, he says, it's collecting more of it--such as data coming into Sears' call center about which appliances are breaking and how often. But Shelley doesn't offer a clear example of how Sears is putting that kind of data to profitable use.</p> <P> One argument in favor of Sears doing a startup like MetaScale is that Amazon.com, the most feared company in retail today, is doing its own tech startups. The e-commerce giant's Amazon Web Services arm pioneered the sale of commodity infrastructure-as-a-service, letting companies buy computing capacity by the hour with only a credit card. Sears is attacking a niche in the cloud computing market: high-end, specialized Hadoop workloads.</p> <P> A more powerful argument in favor of MetaScale is that it forces Sears to stay on the leading edge of big data management and analytics, and lets it learn from big companies that are innovating in other industries while also driving some revenue. Shelley won't say how many clients MetaScale has, but he refers to a major healthcare company and another in financial services.</p> <P> <strong>Retail Must Change</strong></p> <P> You can't walk into a Sears store today and really feel how Shelley's big data efforts have changed the shopping experience. But Sears isn't alone--up against this challenge is every single big retailer: Best Buy, J.C. Penney, Wal-Mart, Target, Home Depot, Lowe's. Every one of them needs to figure out how to make in-store shopping so appealing that customers come to their stores to make purchases rather than to just look around and then buy from discount competitors online.</p> <P> It's no exaggeration to say that Sears' survival hinges on its ability to figure out how to serve customers across store, Web, and mobile channels. </p> <P> Lampert, in his chairman's letter, listed the five pillars of Sears' business (see p. 22). One is "reinventing the company continuously through technology and innovation." Lampert said he spends more of his time on that pillar than any other. He realizes that people will soon, instinctively, reach for their smartphones as they shop in stores. "How people shop today is changing, and it isn't just the younger generation that is benefiting from iPads, Facebook, and online retail," Lampert wrote.</p> <P> Retailers have yet to take truly daring steps to create this cross-channel experience. But imagine stores geofenced by Wi-Fi, so that loyalty card customers' smartphones automatically notify the store when they walk in. Sounds creepy at first, but that's exactly what many people have set up on Amazon. Give people a compelling reason to set that kind of functionality up in a physical store--say, to receive customized offers on their phones--and they will. </p> <P> How about changing prices multiple times a day? Sears is building the data analytics necessary to make those kind of dynamic price and inventory decisions; like other retailers, it's also experimenting with digital price signs in stores that would make such changes feasible. Again, dynamic pricing would be a dramatic change, but perhaps one needed to compete with online retailing. </p> <P> Retailers' survival depends on these kinds of changes in the mobile e-commerce era. If Sears' MetaScale work helps it figure out the omni-channel shopper, its startup will succeed. If it doesn't, or it distracts Sears from this mission, it will have failed because there won't be a Sears or Kmart left. </p> <P> <center>Go to the main story:<br> <b><a href="http://www.informationweek.com/global-cio/interviews/why-sears-is-going-all-in-on-hadoop/240009717">Why Sears Is Going All-In On Hadoop</a></b></center></p> <P>  <center> <div id="printfeaturePDFpromo"><div class="printfeaturePDFCover"><a href="http://reports.informationweek.com/abstract/81/9118/Business-Intelligence-and-Information-Management/informationweek-november-5-2012.html?k=axxe&cid=article_axxe_os"><img src="http://twimgs.com/infoweek/1349/smallcov2.jpg" alt="InformationWeek: Nov 5, 2012 Issue" title="InformationWeek: Nov 5, 2012" /></a></div> <div class="printfeaturePDFCopy"><strong><a href="http://reports.informationweek.com/abstract/81/9118/Business-Intelligence-and-Information-Management/informationweek-november-5-2012.html?k=axxe&cid=article_axxe_os">Download a free PDF of <nobr><em>InformationWeek</em> magazine</nobr></a><br /> (registration required)</strong></div> <div class="clearBoth"></div> </div> </center>  <P>2012-10-22T11:41:00ZWill CMOs Outspend CIOs? Wrong QuestionInstead of focusing on who controls those tech dollars, IT pros should focus on why companies need more tech in marketing and where they can fill those needs.http://www.informationweek.com/thebrainyard/news/240009521?cid=RSSfeed_IWK_authorsRemember Thomas Friedman's <i>The World Is Flat</i>? In four clever words, he gave us a catchphrase for all the fear and promise and complexity of globalization. Same with Nicholas Carr's article "IT Doesn't Matter"--a three-word summary of all the fear about IT becoming a commodity. <P> The 2012 phrase of fear has been "the CMO will spend more on IT than the CIO." Not quite as catchy, and almost no one cites the source of that prediction: Gartner analyst Laura McLellan. McLellan staked out her claim in two webcasts this year, predicting that CMO spending will pass CIO spending on technology within five years. <P> So I called McLellan. Whether her prediction comes true isn't that important for you. What is essential to any CIO's career is to understand the trend she's talking about. Here's what I learned. <P> <strong>The Basis</strong> <P> McLellan's core argument is that marketing's role in the company is expanding as e-commerce sales grow and social and mobile rise as customer channels. Marketing budgets are rising overall, technology as a share of those budgets is rising, while conventional IT budgets are growing more slowly. Ergo, those lines will cross and marketing tech will pass IT spending, she predicts, by 2017. (Most of McLellan's data pertains to high-tech companies, but she says it applies broadly.) <P> <strong>[ Want more on how IT's changing? Read <a href="http://www.informationweek.com/global-cio/interviews/15-new-rules-for-it-to-live-by/232601847?itc=edit_in_body_cross">15 New Rules For IT To Live By</a>. ]</strong> <P> Of the three big areas of marketing tech spending, first is e-commerce. Marketing often owns the e-commerce site, so more and more CMOs McLellan talks with have P&L accountability because of e-commerce. <P> Second is social and mobile. This used to be trying to get people on Facebook to click through and buy something. That approach hasn't worked so well. Now it's about mining social networks for new product ideas, building loyalty through social interactions, and offering self-serve customer information for support. It means building mobile apps to enhance products. And that means spending big money on software development, analytics, data management platforms, and raw computing power. And CMOs are buying in all those areas, often without IT's help. <P> The third spending area is around marketing effectiveness, i.e., campaign management and process management. Marketing hasn't gone through the efficiency and automation wringer that other company areas have. <P>   <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div>   <strong>Marketing's Role Is Expanding</strong> <P> The old outlook was that marketing was in charge of promotions to get and keep customers. The new outlook is that "marketing's role is to drive growth," McLellan says, and that mandate includes product development, strategic planning, and customer service and interaction. It seems to me that McLellan paints a picture where marketing owns just about everything about the customer. <P> <strong>The Tension</strong> <P> The reason "CMO will outspend CIO" strikes a chord is because 1) it rings true about rising marketing tech spending, and 2) many CIOs know they don't have a good relationship with the CMO. <em>InformationWeek</em> research finds that more IT leaders give their relationship with marketing weak marks (29%) than for any other business area. With the CMO-CIO relationship, "my gut feel is it's not working in more places than it is," McLellan says. <P> <strong>My Takeaway</strong> <P> And yet, marketing desperately needs great technology if it's going to succeed. Marketing is in a trial-and-error mode, McLellan says, trying out new techniques for tasks like analyzing customer sentiment on social networks or trying to create a two-way interaction via mobile and social channels. Whether to automate their operations or analyze data, marketing teams are buying cloud software, giving it a short run, and dumping it if it isn't working. "Marketing has an internal innovation and R&D role that is brand new," McLellan says, adding: "Marketing's thinking might be 12-plus months ahead of where IT is." <P> Do IT leaders understand where all of this is headed? <a href="http://www.informationweek.com/big-data/commentary/global-cio/interviews/240008750/memo-to-oracle-sap-listen-to-pgs-language">Listen to Procter & Gamble CIO Filippo Passerini</a>'s remarks at the <em>InformationWeek 500</em> conference in September: "There is nothing more important for us than to be able to predict [customer response] when we launch a new initiative, a new brand, a new product, a new packaging." He thinks P&G can monitor online reaction to predict in-store sales well before sales data comes in. "We haven't cracked this nut yet. I believe this is the next stage of breakthrough opportunity." <P> Marketing is searching for answers. IT needs to be immersed in that search. <P> This isn't just about marketing; it's about digitizing more of our customer interactions. What used to be a phone call and a customer file now could include a customer's mobile app activity, tweets, Web searches, and purchase history. It's not about marketing winning and IT losing--it's about creating a new function across marketing, tech, product development, and customer experience that doesn't exist today. We haven't cracked this nut.2012-10-19T10:46:00ZWhy GM's Hiring 3,000 IT Pros From HPMove answers a key question that had been hanging over GM CIO Randy's Mott's strategy.http://www.informationweek.com/news/240009371?cid=RSSfeed_IWK_authorsGeneral Motors plans to hire 3,000 IT people who now work for Hewlett-Packard on GM projects. HP has been one of the main IT service providers for GM, which is bringing nearly all of its outsourced IT work in-house. <P> GM CIO Randy Mott, on board since February, thinks his IT workers can be more efficient and effective as in-house employees. The 3,000 HP people GM is bringing onboard have been running and developing IT systems for the automaker in locations worldwide. Their hiring is part of an IT overhaul led by Mott that will move the company from relying on outsourcers for 90% of its IT operations to only 10%. <P> The pact with HP answers one question hanging over Mott's strategy: Could GM hire thousands of employees and get them up to speed on the car industry fast enough to avoid disruptions? HP says many of those 3,000 hires are long-timers on the GM account, so they know the company and the industry. They'll join GM over the next six months. <P> Mott said he can get more value out of those 3,000 people by changing the kinds of work they do. He expects to automate a lot of the work outsourcers used to do, so that IT staffers can work on more innovative, change-the-business kinds of projects. "Their jobs will be changing pretty rapidly," Mott said, during a conference call discussing the HP deal. <P> <strong>[ Want details on GM's insourcing? Read <a href="http://www.informationweek.com/global-cio/interviews/general-motors-will-slash-outsourcing-in/240002892?itc=edit_in_body_cross">General Motors Will Slash Outsourcing In IT Overhaul</a>. ]</strong> <P> That drive for automation leads to the second part of GM's deal with HP. GM plans to buy HP software to increase automation of tasks such as infrastructure monitoring and management, as well as for information security. George Kadifa, executive VP of HP Software, called the deal "the largest deployment of our full software portfolio in the world." <P> Mott, who was CIO of HP until June 2011, has experience with those platforms, having used them to drive automation and consolidation at HP. At GM, Mott's plan includes consolidating 23 data centers to 2, as well as reducing the number of applications GM runs by at least 40%. <P> GM will also implement HP's Autonomy data management software and Vertica analytics software. Mott puts those investments in the innovation category, since they address the company's shortcomings in using data to gain insights into the business, from customer buying habits to warranty redemption trends to production data from assembly plants. GM will also implement HP portfolio management software to help manage its projects, as Mott implements his <a href="http://www.informationweek.com/software/business-intelligence/the-metrics-that-matter-most/212200749">detailed planning process</a>. <P> GM has also entered into service contracts with GM to help the automaker with its data center consolidation, legacy application modernization, and security-related projects. Neither company would reveal the value of the deal. <P> GM previously announced that it will hire about 1,500 employees in Warren, Mich., outside Detroit, and about 500 in Austin, Texas, for what it calls "innovation centers." Those people are supposed to focus on working with business units to craft IT-powered projects and quickly deliver them. <P> While Mott hasn't discussed specifics on the kind of innovative projects GM needs, CEO Dan Akerson has identified the need for better data warehousing and more data-driven decision making, and Mott has noted that too much data is in silos that could be more powerful if shared across business groups. Mott estimates GM has about 200 sizeable data warehouses, and his goal is to move that onto one architecture. But IT will be under pressure for new ideas across GM's business: in-car technology, customer research such as social network sentiment analysis, globalizing applications, dealer management, and global collaboration tools. <P> There's a famous quote about Alabama football coach Bear Bryant: "Bryant can take his'n and beat your'n, and then he can turn around and take your'n and beat his'n." Mott has to prove he can do something similar. He's using 3,000 of the same people who have been doing IT for GM, but with a different strategy and focus he thinks he can make better use of them. The key, Mott say, will be moving many of those people out of run-the-business roles and into innovation roles. <P> <i>The business world is changing. Is your company ready? E2 Innovate, formerly Enterprise 2.0, is the only event of its kind, bringing strategic business professionals together with industry influencers and next-gen enterprise technologies. Register for <a href="http://www.e2conf.com/innovate/registration/?_mc=IWKPL">E2 Innovate Conference & Expo</a> today and save $200 on current pricing or get a free expo pass. Nov. 12-15, 2012, at the Santa Clara Convention Center, Silicon Valley.</i>2012-10-19T09:12:00ZIs IT's Core Competency Making Others Look Good?Quintiles CIO's team focuses on revenue-driving ideas, then partners with business units to make them real.http://www.informationweek.com/news/240009362?cid=RSSfeed_IWK_authorsRichard Thomas, the CIO of Quintiles, thinks his IT team's most critical skills need to be making other people in the company look good. <P> Now, that approach could be a disaster if used as an excuse for IT to stay in a back-office, just-support-the-business role. But Thomas and his team are doing it right, as Thomas explained to the InformationWeek 500 Conference last month. (See the video below.) <P> Quintiles provides services to pharmaceutical and biotech companies to help them run clinical trials. Thomas has spent the past seven years as CIO of Quintiles pushing the IT team to be a revenue generator as part of that effort. In doing so, however, Thomas isn't trying to build a fiefdom of software products that he and his IT team runs. And that's where making others look good comes in: When IT sees a way to make money selling IT products or IT services, it looks for the right business units to partner with, and lets them champion it and carry it forward. <P> "We passionately believe in giving our ideas away," Thomas said. <P>   <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div>   <P> In the video below, he explains how Quintiles has worked for three years on a project called Semio, with partner and customer Eli Lilly. It's a collaborative environment that pharma companies can use to examine healthcare data in order to design the best approach to a clinical trial--balancing the cost, time, and chance for success. You can see glimpses of that environment in this video. To develop that project, Thomas teamed IT pros with Quintiles business unit experts and Eli Lilly experts--those business unit leaders led three of the four technical development teams. "That worked really well. There was no us and them. There was no divide," Thomas said. <P> He calls these tech-driven new products "game changers." They're driving about $40 million in annual revenue, Thomas said, but more important, they helped Quintiles land $400 million in new business where the technology was a key part. That's why the business unit partnerships are so important. "All our game changers have been where we try to shift the idea into a business line and let them take it forward," Thomas said. <P> In the video, Thomas has a lot more to say on the people and culture needed to focus an IT organization on creating products and working directly with key customers, instead of just keeping the IT lights on. "New IT is definitely not for everyone," he warned. "It's a bit out there, and it's not certain what it will look like when it's finished, especially with some of these game-changing types of initiatives." <P> Another reason occurred to me to have business units take IT's great ideas and operate them long-term: If IT hands off projects once they're built, that keeps a certain pressure to come up with the next game-changing idea. <P>  <div style="display:none"> Informationweek.com run-of-site player, used to publish article embedded videos via DCT. The same ads will be served on this player regardless of embed location. </div>  <script language="JavaScript" type="text/javascript" src="http://admin.brightcove.com/js/BrightcoveExperiences.js"></script> <object id="myExperience1886855168001" class="BrightcoveExperience"> <param name="bgcolor" value="#FFFFFF" /> <param name="width" value="480" /> <param name="height" value="270" /> <param name="playerID" value="1223625539001" /> <param name="playerKey" value="AQ~~,AAAAAF14eAc~,GZC-YoxXnehVitUBmX0u2QYfPEVvZG_k" /> <param name="isVid" value="true" /> <param name="isUI" value="true" /> <param name="dynamicStreaming" value="true" /> <param name="@videoPlayer" value="1886855168001" /> </object>  <script type="text/javascript">brightcove.createExperiences();</script> 2012-10-08T11:11:00ZGM To Hire 1,500 IT Pros In MichiganIT development center in Warren is the latest location in General Motors' plan to ramp up staff and reduce its use of outsourcing.http://www.informationweek.com/news/240008636?cid=RSSfeed_IWK_authors <div class="inlineStoryImage inlineStoryImageRight"><a href="http://www.informationweek.com/global-cio/interviews/20-great-ideas-to-steal/240006553"><img src="http://twimgs.com/informationweek/galleries/automated/860/01_Intro_tn.jpg" alt="20 Great Ideas To Steal" title="20 Great Ideas To Steal" class="img175" /></a><br /> <div class="storyImageTitle">20 Great Ideas To Steal</div> <span class="inlinelargerView">(click image for larger view and for slideshow)</span></div>  General Motors is opening what it calls an Information Technology Innovation Center in Warren, Mich., where it will hire up to 1,500 IT pros over the next several years. This is the latest step in GM's IT overhaul under new CIO Randy Mott, in which the automaker is hiring employees to do technology work rather than relying on outsourcers. <P> The automaker plans to have four of these IT development centers in the U.S. GM last month opened one in Austin, Texas, where it plans to hire up to 500 people. The other locations haven't been announced. Mott said the centers' locations would be chosen based on the quality of talent they'll be able to attract, including their proximity to universities. <P> GM has relied on outsourcers for about 90% of its IT work, from developing software to operating data centers. Mott, who was named GM CIO in February, intends to reverse that percentage, bringing 90% of the company's IT work in-house and using outsourcers for just 10%. It's a <a href="http://www.informationweek.com/global-cio/interviews/general-motors-will-slash-outsourcing-in/240002892">high-risk strategy change</a> that will mean hiring thousands of tech pros and building a new culture of IT innovation and collaboration with the rest of GM. But Mott maintains that IT staffers will better understand the automotive industry and thus come up with more innovative ways to use technology than outsourcers could. <P> <strong>[ Want more on GM's hiring? Read <a href="http://www.informationweek.com/global-cio/personnel/gm-cio-why-were-hiring-recent-college-gr/240007319?itc=edit_in_body_cross">GM CIO: Why We're Hiring Recent College Grads</a>. ]</strong> <P> GM already has a data center in Warren, north of Detroit, that will be the site of one of GM's two global data centers. GM plans to consolidate its more than 20 data centers into two. The new development center is at the same location as the data center. The company says it has jobs available in software development, project management, database management, and business analysis, and that it's recruiting recent college graduates and experienced professionals (Applications at careers.gm.com/itjobs.)2012-10-08T08:00:00Z6 Bright Ideas Found At A Tech ConferenceFrom working with the CMO to experimenting with clouds.http://www.informationweek.com/news/240008433?cid=RSSfeed_IWK_authorsThe weather stinks, wish you were here! The forecast proved 100% accurate for my latest tech conference, TechTomorrow in Columbus, Ohio: Rain, with a 100% chance for agreement that mobile's important, big data is hard, and damn it, we really, absolutely must get IT aligned with business goals. </p> <P> Every event faces intermittent obviousness, but good ones help the clouds part so smart ideas shine through. Here are six useful things I heard.</P> <P> <strong>"I need an IT partner in everything I do."</strong> That's a chief marketing officer--Shelly Stotzer, CMO and VP for publishing company Highlights for Children.</p> <P> IT's latest existential worry is that its tech spending will be eclipsed by the CMO's as marketing becomes more data-driven. Meanwhile, CMOs just want to make sense of the loads of data they're accumulating, get mobile apps built faster, and know when social networks light up with flames of glory (and disgust) about their products. The problem is that too many IT teams have a strained or nonexistent relationship with marketing, so marketing doesn't even think of IT as a resource for tech-intensive problems.</p> <P> Stotzer said a CMO needs someone who knows what's possible with technology and can help wring out a fix--not someone who waits for the CMO to request a project. "I need you to figure out what I really need," she said.</p> <P> <strong>"A lot of times we ask, 'Why did the customer do that?'"</strong> Tara Paider, associate VP of IT architecture at Nationwide Insurance, said its statisticians look at its data to understand customer trends. But Nationwide also has a behavioral psychologist, along with marketing, tech, and product specialists, on a cross-discipline team.</p> <P> While emerging tools like Hadoop let companies explore new unstructured data sources, Paider emphasized that companies already know a lot about their customers from conventional, structured data warehouses, and those environments aren't going away. Better decisions will come from combining the new insights from unstructured data with existing customer knowledge. "Looking at big data out of the context of the information you already have about your customers and policies and products is a bad idea," Paider warned. </p> <P> <strong>"Digital is completely different from steel lift trucks."</strong> Mike Gallagher is VP of design at Crown Equipment, a maker of lift trucks that for the past seven years has been working to make technology a bigger part of its products. Its software includes tools that monitor data such as the operating efficiency of fork lifts--and the people who run them.</p> <P> Crown has learned that designing a digital component takes far more collaboration than designing a mechanical part, Gallagher said. Software elements are different because they connect to so many parts of the product, and because the user interface is so central to the experience. Plus, they change much faster than mechanical parts.</p> <P>   <div style="margin:0; padding:0 0 10px 15px; width:244px; float:right;"> <div style="margin:0; border-top:1px solid black; border-bottom:1px solid black; padding:6px;"> <a href="http://www.informationweek.com/global-cio/"><img src="http://twimgs.com/infoweek/1217/217ID_GlobalCIO_75.jpg" width="75" height="75" border="0" align="right" alt="Global CIO" style="margin:0 0 6px 6px;"></a> <div style="margin:0 0 6px 0; font-size:1.3em; font-weight:bold; color:#113e53;">Global CIOs: A Site Just For You</div> <span style="font-size:.9em; font-weight:bold;">Visit <a href="http://www.informationweek.com/global-cio/">InformationWeek's Global CIO</a> -- our online community and information resource for CIOs operating in the global economy.</span> </div> </div> 	 	 <P> As more machines are linked into an "Internet of things," more companies have to bring digital experiences into their products. They'll learn it's hard to mesh the faster, more collaborative software development cycle with an existing product development process.</p> <P> <strong>"We refer to mobile not as a channel but as a metachannel."</strong> Risking obviousness here, but it's a point well said by Scott Gamble, VP at Alliance Data. A mobile strategy used to mean mobile marketing and commerce. Now it's understanding how people use a smartphone while shopping in a store, visiting a resort, filing a claim, or talking with a patient.</p> <P> <strong>"Once you've spent a certain amount of money, pilots don't fail."</strong> Cloud infrastructure and software should mean we now do fast and cheap experiments rather than slow, costly pilot projects, said MIT's Michael Schrage (author of Who Do You Want Your Customers To Become?). Doing so would make it more likely for people to do real experiments--ones where the outcome's uncertain and it's really OK for them to fail. With cloud infrastructure, if an experiment works, the company can scale up more quickly. "The future of innovation is, how do we learn from small experiments and scale them?" Schrage said.</p> <P> <strong>Run these experiments on "customers the organization respects."</strong> Also from Schrage. It strikes me that this is the part of cloud-based experiments that's not cheap and easy. The attention of your best customers is precious, and you can throw only so many half-baked ideas at them, yet it's the opinion of great customers that companies value most. So I see this as the main constraint on ramping up more cloud-based experiments. Schrage, however, argued that "your customers will think you look smart for approaching them." </P> <P>  <center> <div id="printfeaturePDFpromo"><div class="printfeaturePDFCover"><a href="http://reports.informationweek.com/abstract/83/9095/IT-Business-Strategy/informationweek-october-15-2012.html?k=axxe&cid=article_axxe_os"><img src="http://twimgs.com/infoweek/1346/smallcov2.jpg" alt="InformationWeek: Oct. 15, 2012 Issue" title="InformationWeek: Oct. 15, 2012 Issue" /></a></div> <div class="printfeaturePDFCopy"><strong><a href="http://reports.informationweek.com/abstract/83/9095/IT-Business-Strategy/informationweek-october-15-2012.html?k=axxe&cid=article_axxe_os">Download a free PDF of <nobr><em>InformationWeek</em> magazine</nobr></a><br /> (registration required)</strong></div> <div class="clearBoth"></div> </div> </center>  <P>2012-10-03T08:00:00Z8 IT Mistakes: Must-Have Lessons From Top CIOsSpare the euphemisms. Great teams embrace mistakes and get better.http://www.informationweek.com/news/240007998?cid=RSSfeed_IWK_authorsThe best companies stare their IT mistakes straight in the eye. </p> <P> They don't tiptoe around them. They don't rename them "teaching moments" or "issues." They don't play blame games. They lay their mistakes bare so that their teams can improve. </p> <P> They talk about their IT mistakes in the way CenterPoint Properties CIO Scott Zimmerman describes his team's first mobile application development. "We had to refactor because our egos caused us to forget the golden rule of software development: Always involve the users," Zimmerman says.</p> <P> Mistakes are at the center of any business technology innovation--swing for big wins, sometimes fail, learn and improve. </p> <P> We embraced this idea as part of this year's <a href="http://informationweek.com/500"><i>InformationWeek 500</i></a> by asking every IT team to share its biggest mistake this year. Not everyone was comfortable discussing them publicly--the wound is too fresh for some, and many are still working on the fix. What follows are real-world examples from IT teams willing to share. </p> <P> <strong>Mistake: Treating mobile development like desktop development</strong></p> <P> CenterPoint is a developer and manager of industrial property, and it has some veteran application developers who know the business well. The kind you want. But when it came to building a mobile app, that knowledge of the business recently got the better of the IT team. CIO Zimmerman describes it this way:</p> <P> "So when we created our first mobile app, we wanted to surprise/impress our business colleagues. We let enthusiasm cloud our judgment, trying to think through requirements for them. Initial adoption was disappointing. It 'looked cool' but didn't meet their 'mobile' needs. We failed to recognize that people often perform business functions differently in the field than at their desk."</p> <P> That realization forced the team to redo the app, and it's what reminded the IT team of that golden rule of software development, and the importance of working closely with the application end users. The app is back on track.</p> <P> Mobile app dev is serving up a lot of tough lessons. Few enterprise IT teams have deep experience with the technology and languages. And there's almost always an impossible time pressure, as marketing wants that mobile app this quarter rather than next year.</p> <P> Vail Resorts CIO Robert Urwiler says he made the mistake of outsourcing too much of the resort company's customer-facing mobile Web app, EpicMix, in its first year. In year two, he built an internal team for much of that work (see <a href="http://www.informationweek.com/global-cio/interviews/vail-takes-sharp-turn-on-dev-outsourcing/240007027" target="_blank">Vail Takes Sharp Turn On Dev Outsourcing Strategy</a>). Creating customer-facing software also demands that developers have a tight relationship with business units, especially marketing. "It's not like 'You do the idea generating, and we'll build the software,'" Urwiler says. "We need to be joined at the hip throughout these initiatives." </p> <P> <strong>Mistake: Assuming everyone wants a social network inside a company</strong></p> <P> Several <i>InformationWeek 500</i> companies noted initial lackluster adoption of employee-focused social networking and related collaboration tools. Some, like online game company Zynga, turned that reluctance around, while others say the software still isn't delivering. Zynga put it this way:</p> <P> "We anticipated that internal collaboration tools would gain adoption faster than they did. We've made significant improvements on that front but learned a lot in the process. The biggest reminder for us was that content is key to driving internal adoption of enterprise social network tools."</p> <P> What's refreshing about Zynga's experience is that it comes from a company on the cutting edge of the social Web, whose games are intimately linked with Facebook and social sharing. The Zynga team lives and breathes the social concept, but it still needed vital content in an in-house social platform to make the tools relevant.</p> <P> That's an important reminder if IT is tempted to blame end users for not hopping on new social collaboration tools: Employees are old, they don't get it, they're not tech savvy. Those are all cop-outs for not providing employees with a compelling reason why a social tool is a better, more efficient way to collaborate.</p> <P> <strong>Mistake: Using outsourcing the wrong way </strong></p> <P> Several companies cited outsourcing problems as their big mistake. Sometimes it was execution, such as the outsourcer not having the promised skills or capability. Vail's Urwiler, as mentioned above, felt he handed over too much project management. One admitted to moving too much to outsourcers too fast. With all of the outsourcing mistakes cited, we're seeing IT leaders get more demanding of what they expect from their vendors. </p> <P> Edward Wagoner, CIO of the Americas for Jones Lang LaSalle, is fine-tuning his company's outsourced IT help desk strategy to better fit the commercial real estate company's culture. In commercial real estate, even as digital marketing becomes more important, it's still the top talent who drive growth, and these rock-star salespeople thrive on relationships. </p> <P> Explains Wagoner: "We bought into the theoretical concept that certain IT functions such as help desk support could be 'black boxed' (e.g., that the end user wouldn't care who the help desk person was or where they were located as long as the problem was resolved). We failed to realize that our top talent values that personal relationship in all areas of their work life. They want to know that Donna is their IT support person. They want Donna to understand their business and the way they work. They want Donna to be a part of their extended team. They value having a relationship with Donna vs. calling an 800 number."</p> <P> Wagoner has started assigning individuals to support key people and offices. Those outsourced support people have the go-ahead to ignore certain productivity metrics if it means solving a problem--"think airline platinum" status, Wagoner says. Salespeople have even called him to thank him for the support. And the relationship building continues.</p> <P> Outsourcing may or may not be right for a given company. But regardless, IT needs to consider its company's unique culture and business model, and bend the outsourcing model to its needs. </p> <P> <strong>Mistake: Underestimating the upside</strong></p> <P> Innovation often happens only after putting IT tools in employees' hands and watching what they do with them. Nice in theory, but it takes flexible IT operations to react to the new demand that such a process can create. </p> <P> Hertz came to this realization when it created its ExpressRent kiosks, which let people make a rental car reservation using a live video call to a customer service rep, along with a touch screen to enter data, a scanner to validate a driver's license, and a printer to provide a rental agreement. But Hertz's IT team had to scramble when demand picked up in an unexpected market. Says Hertz: </p> <P> "We originally marketed the ExpressRent kiosks primarily to body shops and dealerships for insurance replacement rentals, assuming usage would be greatest for one-off rentals outside of business hours. We hadn't anticipated the airport market, already fully staffed and with a vast majority of 'existing' reservations, would be the success point for implementation. Modified deployment planning and additional kiosk refinements needed to be made in addition to securing airport authorities' approval for placement."</p> <P> Quintiles, which runs clinical trials for biotech companies, launched a cloud-based service for drug development in 2011. Its business plan predicted that only small biotech companies would use the service. But some of the industry's largest biotech companies showed interest, asking for a scale of deployment for which Quintiles didn't have the people or technology, forcing it to scramble to ramp up. </p> <P> Success is a nice problem to have, but it can still test IT's ability to deliver results.</p> <P><strong>Mistake: Struggling to get off legacy systems</strong></p> <P> A surprisingly large number of CIOs described how hard it has been to get off a legacy system. Some problems involved moving to cloud software, including integrating systems from different vendors to replace a single legacy system. Some described employees who relied on specific features or databases tied to the old system, requiring process and cultural changes to switch software and get off those functions. </p> <P> One IT team, asking that its company not be identified, described its change management challenge: </p> <P> "We began a legacy system replacement early last year. Going into one of our larger locations, we thought we were cruising. But we had failed to truly understand the complexity of management reporting they had developed internally over the years. So when we swapped the system, all their custom reporting broke. It was big-time scramble mode to review, design, and build the reporting they were expecting. In all, a six-month project delay due to insufficient discovery. Big lesson learned for our project management team. And we left with a better design headed to the next location."</p> <P> IT will rarely be hailed as the hero at first for moving the company off a legacy software system. Such moves force employees to change, so they resist. As this example shows, processes and functions can break during the process.</p> <P> But for every problem we heard about moving off legacy systems, we heard another say their biggest mistake was not moving off legacy systems fast enough as they brought on new systems, sapping the new project's return on investment. </p> <P> <strong>Mistake: Taking on too much</strong></p> <P> In a healthy business, there's always some tension caused by business units asking for more than IT can deliver. IT is a constrained resource. But many IT leaders cite mistakes in managing the demand pipeline, either by not communicating and setting priorities well with the business units, or just taking on too much and crushing their teams.</p> <P> One CIO, who asked that his company not be identified, says a lot of projects were pushed to the back burner during a three-year ERP project, which the company finished in 2010. So 2011 "was a year where pent-up demand for systems reached a peak," he says. The company launched a website, a customer loyalty program, and more in the first quarter of 2011. The logjam became clear in the following months, and IT met with each main business unit in the third quarter to better set priorities and expectations. </p> <P> Mismanaging IT demand badly can lead to poor-quality software and systems. But even when IT does deliver strong results, leaders must recognize the very real human toll. Cincinnati Children's Hospital Medical Center recognized that risk as it raced to innovate: </p> <P> "In 2011 our organization took on a number of high-profile and strategic projects that required significant time and dedication from our staff," the hospital says. "Although we successfully completed all of these projects, we risked staff burnout in asking our staff to go above and beyond on multiple occasions throughout the year."</p> <P> <strong>Mistake: Getting into a virtualization rut</strong></p> <P> Server virtualization has been the golden goose of technology ROI. By getting higher utilization from servers, IT shops have been able to consistently lower data center costs and in some cases avoid the multimillion-dollar capital expense of building a new data center. But even this money machine has its limits.</p> <P> HCA Information Technology & Services found that limit. The group provides IT services to the 150 HCA hospitals, hundreds of physician offices, and non-HCA healthcare groups as a revenue center for the company. Here is its experience: </p> <P> "We began server virtualization in 2009, and as our successes increased we began to see virtualization as a hammer searching for a nail. In 2011, we discovered several scenarios where we had chosen virtualization hastily, or we combined environments that did not match logically. All of this required us to take a step backward and to develop a more defined methodology and framework to decide which applications were right candidates for virtualization. We believe our move into internal cloud services will require us to learn from our virtualization days and ensure we have a highly defined selection process."</p> <P> Plenty of companies have broken applications as they virtualized servers. As companies get more aggressive by building private cloud environments that virtualize computing, storage, and even networks, the transition will get more difficult. FedEx, for example, has created an entire private cloud data center and will only move applications into it once the company has rewritten these apps so that they're optimized for that highly virtualized environment. </p> <P> IT organizations tend to think of a private cloud as the safe choice--all of the flexibility and security of a public cloud such as Amazon's EC2, but without the security worries. But plenty of gotchas await. </p> <P> <strong>Mistake: Underestimating mobile demand</strong></p> <P> IT didn't see the iPhone revolution coming. It wasn't until top execs and salespeople started bringing them in and demanding to get corporate email on them that IT took on the security problems iPhones created. So lesson learned, right? IT would be all over the iPad?</p> <P> Not really. IT did start experimenting with tablets right away, but many teams thought it would be at best a niche device, maybe something that would start slowly with executives. IT organizations weren't ready for how soon and how many employees would crave iPads--and who could make a credible case for why tablets make sense for work. </p> <P> A number of healthcare companies, in particular, were caught flat-footed by how many doctors insisted on using personal tablets. They've told us of extraordinary steps that "maverick docs" took to use iPads, like using apps of questionable security or installing desktop access software on a tablet to view records from the doctor's PC. </p> <P> Salespeople instantly saw the iPad's appeal as a better device to use while chatting one-on-one with a prospect. One financial company described its iPad experience this way: </p> <P> "Mobile computing has been a key component of our IT strategy for several years. We've delivered on initial focus areas, building mobile applications for customers and enabling employee personal mobile device access to company email. Our mistake was in not anticipating the dramatic surge in popularity of the iPad commensurate with the release of the iPad 2. Sales force demand to leverage company-liable tablets rose suddenly, requiring us to be uncustomarily reactive. IT quickly bridged the gap, setting policy and implementing mobile device management, which enabled the company to mitigate financial impacts. However, we're still working to regain the full confidence of our sales executives."</p> <P> Sales executives are going to need IT's help to get the most out of tablets. Companies that roll out tablets quickly learn that they need content and applications fine-tuned to their specific needs, such as for accessing inventory available for sale and providing tablet-friendly presentations. </p> <P> But this company's reaction is a pretty good guide to bouncing back from any of these mistakes. Fix the technology, build a platform for future innovation--and spend time strengthening IT's relationships so that mistakes are much less likely to happen in the future. </p> <P> <center><a href="http://www.informationweek.com/1343"><img src="http://twimgs.com/infoweek/1343/1343_500_return_to_homepage.gif" width="299" height="45" hspace="0" vspace="0" alt="Go to the 2012 InformationWeek 500 homepage" title="Go to the 2012 InformationWeek 500 homepage" border="0"/></a></center></p> <P>  <center> <div id="printfeaturePDFpromo"><div class="printfeaturePDFCover"><a href="http://reports.informationweek.com/abstract/19/9060/Network-Infrastructure/informationweek-october-8-2012.html?k=axxe&cid=article_axxe_os"><img src="http://twimgs.com/infoweek/1345/smallcov2.jpg" alt="InformationWeek: Oct. 8, 2012 Issue" title="InformationWeek: Oct. 8, 2012 Issue" /></a></div> <div class="printfeaturePDFCopy"><strong><a href="http://reports.informationweek.com/abstract/19/9060/Network-Infrastructure/informationweek-october-8-2012.html?k=axxe&cid=article_axxe_os">Download a free PDF of <nobr><em>InformationWeek</em> magazine</nobr></a><br /> (registration required)</strong></div> <div class="clearBoth"></div> </div> </center> 2012-09-18T10:03:00ZZuora: $82 Million Bet On 2 Big IdeasZuora is the latest startup whose success hinges on customers' willingness to turn their business over to a cloud vendor.http://www.informationweek.com/news/240007506?cid=RSSfeed_IWK_authorsZuora, a startup with $82.5 million in venture financing, is betting on two big ideas. <P> One is that subscription services are becoming such a big part of companies' revenue streams that they need software designed from scratch to deal with the nuances. <a href="http://www.zuora.com/">Zuora</a> dubs it the "subscription economy" and cites Zipcar as an example--people subscribe to a car as a service rather than buy one. But they also point to established companies like Lowe's offering a home monitoring service. <P> The second big idea is that CIOs will trust run-the-business, revenue-focused operations to a 5-year-old cloud software company. <P> The first big idea, that companies need a parallel system to deal with subscriptions, is the most debatable and most interesting of the two. <P> Zuora CEO Tien Tzuo, the one-time chief strategy officer of Salesforce.com, is tapping into the trend whereby companies don't make money by selling things--music, books, movies, cars--but by selling services that provide those things. There's no great debate that this trend is growing. <P> <strong>[ Stuck in a strategy rut? Read <a href="http://www.informationweek.com/global-cio/interviews/6-uncomfortable-questions-it-teams-shoul/240007022?itc=edit_in_body_cross">6 Uncomfortable Questions IT Teams Should Ask</a>. ]</strong> <P> The debatable part comes when Tzuo argues that selling a service is so different from selling a thing that companies should junk their ERP systems and use Zuora cloud software to manage the entire pricing-to-cash-to-revenue recognition cycle for subscriptions. ERP systems were made to manage a physical object that's manufactured and shipped, Tzuo argues, and companies are contorting themselves into knots to make that software work under a subscription model. "It's a Rube Goldberg mess," Tzuo says. "What we're arguing is the ERP model is fundamentally wrong." Selling a service involves offering a wide range of pricing plans with different service levels, and in ERP that often requires creating a different product for each variation of those services, Tzuo says. <P> Zuora offers its Z-Billing and Z-commerce cloud software to manage those functions. Its new <a href="http://www.zuora.com/company/news-and-press/zuora-aunches-z-finance-the-worlds-first-finance-application-built-for-the-subscription-economy.html">Z-Finance</a> software, announced this week, manages the accounting for those sales, intending to make it easier to handle the recurring nature of subscription revenue. Companies still need general ledger software to report financial results for shareholders, but Z-Finance is meant to integrate with the general ledger to handle most of the heavy lifting for steps such as revenue recognition of a long-term subscription. <P> Zuora has started offering all three cloud software services in what it calls a Z-Business suite, starting at $100,000 for the enterprise edition and $30,000 for the "growth edition," with fewer features. Pricing tiers are based on invoice volumes. <P> <strong>Is Zuora The Next Salesforce.com?</strong> <P> Zuora has a disadvantage compared with Salesforce.com in its early days: Zuora can't do an end-run around IT to sell its products. Salesforce was notorious for selling its Salesforce management software directly to a sales team, getting a foot in the door before the IT organization knew what hit it. <P> Tzuo knows that tactic well: He was employee No. 11 at Salesforce, rising to become chief marketing officer and later chief strategy officer. But because Zuora services manage revenue and have to integrate with accounting systems, Tzuo describes it as a "complex sales" process that's very different from Salesforce.com. <P> But there's one obstacle Zuora doesn't face, and it's the reason Zuora's big idea No. 2 isn't all that debatable: Companies are absolutely ready to run critical systems on cloud software. <P> Tzuo says Zuora used to get questions from IT teams on whether they could license the software and run it inside their own data center, an option Zuora didn't offer. "We're not getting those requests anymore," he insisted. "Something happened 18 months ago. ... The CIO has to justify why it isn't SaaS or cloud." <P> Tzuo may have studied hype with a grandmaster, Salesforce founder and CEO Marc Benioff, but here he's actually understating the case. I don't hear the CIO being forced to justify not using cloud software these days; I hear CIOs insisting that their teams consider cloud options. <P> Something has indeed flipped in the past 18 months. CIOs are increasingly open to using cloud software for critical systems--85% of the companies in our latest <a href="http://www.informationweek.com/global-cio/interviews/iw-500-data-shows-how-it-rules-have-chan/240006825"><em>InformationWeek 500</em></a> ranking use software as a service. But something else has flipped as well. They aren't going to cut SaaS a break for features or performance. If it's going to run a critical operation, it needs to offer a clear and dramatic improvement to be worth the risk. You're going to hear a lot about cloud software this week as Salesforce.com holds its <a href="http://www.salesforce.com/dreamforce/DF12/">Dreamforce</a> conference. But CIOs no longer need the cloud religion pitch. They only need the business value pitch. Zuora may be founded on two big ideas, but it has to sell only one of them.2012-09-13T15:03:00ZGM CIO: Why We're Hiring Recent College GradsGeneral Motors CIO explains why IT newbies will be welcome as his team fills thousands of U.S. developer jobs.http://www.informationweek.com/news/240007319?cid=RSSfeed_IWK_authors  <div class="inlineStoryImage inlineStoryImageRight"> <a href="http://www.informationweek.com/thebrainyard/news/galleries/social_networking_consumer/240005778"><img src="http://twimgs.com/informationweek/galleries/automated/853/Chatter-Influence-_full.png" alt="Enterprise Social Networks: Must-Have Features Guide" title="Enterprise Social Networks: Must-Have Features Guide" class="img175" /></a><br /> <div class="storyImageTitle">Enterprise Social Networks: Must-Have Features Guide</div> <span class="inlinelargerView">(click image for larger view and for slideshow)</span> </div>   General Motors is hiring thousands of IT pros as the automaker shifts away from outsourcing, and around 25% to 35% of those new jobs are likely to be filled with people coming right out of college, GM CIO Randy Mott told attendees at the <em>InformationWeek 500</em> conference Monday in Dana Point, Calif. <P> General Motors is in the midst of a massive IT overhaul that includes having GM employees do 90% of its IT work, whereas in the past it has relied on IT outsourcers for about 90% of its work. That will require hiring thousands of GM IT workers over the next five years. <P> Most of those IT jobs will be in the United States. GM plans to have about four technology development centers--one in the Detroit area, one in Austin, Texas, and the others in locations not yet named. The big driver for those locations will be ability to attract talent, including proximity to universities. <P> <strong>[ Collaboration-based hiring practices are gaining traction, especially with younger workers. Read more at <a href="http://www.informationweek.com/thebrainyard/news/workgrouping_team_collaboration_workspaces/free-social-recruiting-app-winning-over/240007216?itc=edit_in_body_cross">Free Social Recruiting App Winning Over Larger Companies</a>. ]</strong> <P> Mott said there are a lot of good reasons to keep a steady flow of fresh-from-college graduates coming into the company. "I'm looking for a high level of energy, and that's what I get," Mott told the InformationWeek 500 conference audience. New college grads also bring a fresh view on how to do things, so they tend to challenge expectations like how long it should take to do a given assignment. "They don't know what they don't know," Mott said. "And they don't know that something's not possible. Within a very short time they rewrite the rulebook for how long it takes to do something." <P> Of course, new graduates lack the technical experience and the business and industry savvy that more veteran IT pros have. But IT always requires a high degree of learning given the rate of technology change, and college grads can learn as fast as any other worker, Mott said. Still, that leads to a critical step for the IT leadership if it's going to make the most of new graduates: Put those newbies around experienced IT pros who are true experts from whom they can learn. "If I think about skills, I think: Hire experts, and hire college grads, and you'll drive a very productive workforce," Mott said. "And oh, by the way, great people want to work around great people, so that helps on the retention side." <P> But new college grads often aren't the first choice for managers looking to hire. IT managers looking to fill a slot will start by making a wish list for a person with every precise skill they might need, "never mind that there might be only four of them on the planet," Mott said. His advice: "You have to force people to hire [new] college grads." <P> <i>Couldn't make it to the InformationWeek 500 Conference? Join us for the <a href="https://www.techwebonlineevents.com/ars/eventregistration.do?mode=eventreg&F=1004761&K=7IK">InformationWeek 500 Virtual Event</a>, featuring the best of the conference plus all-new material. It happens Oct. 2.</i> <P> <em>To find out more about Chris Murphy, please visit his <a href="http://www.informationweek.com/authors/showAuthor.jhtml?authorID=1115">page</a>.</em>2012-09-12T00:01:00ZIW 500 Data Shows How IT Rules Have ChangedFor every cost-cutting priority, there's an equally important customer-focused initiative.http://www.informationweek.com/news/240006825?cid=RSSfeed_IWK_authors <div style="margin:0; padding: 0 0 10px 10px; width:120px; float:right; text-align:center;"> <a href="http://www.informationweek.com/1343"><img src="http://twimgs.com/informationweek/1343/343IWK_CSart_110.jpg" width="110" height="110" alt="InformationWeek 500" hspace="0" vspace="0" border="0" /></a> </div>  <P> Mobile devices, cloud computing, and big data analytics are blowing the old IT rules to pieces. Where companies once turned to their IT organizations for tech support, they now need technology embedded into their products and services. This customer-facing role for IT has been growing ever since the dawn of the Web, but now its a win-or-lose imperative. What were seeing in this years <i>InformationWeek 500</i> ranking of the most innovative U.S. users of business technology is how the very best IT organizations are changing to play by these new rules.</p> <P> In our survey of these 500 innovators, for every efficiency and cost-cutting priority, we see a customer-centric priority as well. Asked to name the top three areas in which they expect to innovate, 49% of <i>IW 500</i> companies cite improving the efficiency of business processes, making this efficiency area the most-cited priority. But thats down five points from a year ago, and down from 60% back in 2009s recession. Very close, noted by 46% of the 500 companies this year, is introducing new IT-led products and services for customers. Back in 2009, only 37% had that as a top priority. (<a href="http://www.informationweek.com/global-cio/interviews/iw-500-data-shows-how-it-rules-have-chan/240006825?pgno=2">See more <i>IW 500</i> data on the next page.</a>)</p> <P> Likewise, 29% cite lower business or IT costs as a priority, down sharply from 2009, when 47% did. Right alongside this cost focus is improve Web operations and customer experience (31%) and engage customers in new ways (30%--up a whopping 10 points from 2009).</p> <P> We see the rise of customer-facing technology just as clearly in the IT projects of our <i>IW 500</i> leaders--from Deere & Co. putting wireless diagnostics software in tractors to UPS letting customers give drivers instructions on where to leave a package.</p> <P> Mobile apps are a major driver of the customer focus--companies are getting mobile apps out to customers even faster than they are to employees. Already, 37% of <i>IW 500</i> companies have widespread deployment of customer-facing mobile apps, compared with 25% for employees. Another third have such mobile apps in limited deployment or pilot for customers. Whether its Vail Resorts giving a smartphone app to skiers or Royal Caribbean putting an iPad in every room of some cruise ships, CIOs are accepting that customers dont want to unplug--they want relevant apps that add to their experience. And ITs working closely with marketing to deliver.</p> <P> Big wins are possible with employee-facing apps, too--38% say that deploying iPads or other tablets is among their biggest productivity boosters. But tablet or smartphone apps are only a hit if theyre finely tuned to employee needs. Thats what IT did at Simon Property Group, the countrys largest shopping mall owner, for a tablet app that can show details and images of all of the companys properties available for rent--an app it credits with helping close deals it otherwise would have missed. </p> <P> Cloud computing is firmly established among <i>IW 500</i> companies. Eighty-five percent use cloud software, and 27% use a cloud platform-as-a-service, such as Microsoft Azure and Google App Engine, up eight points from a year ago. But companies arent just using cloud computing as a platform for internal apps; theyre using it to offer new products to customers. Zynga has taken this trend full circle. It launched its social online gaming business using Amazons pay-for-use cloud infrastructure. Now its big enough that it has brought much of that computing to its own data center, and its launching its own cloud service--letting newbie game companies rent its infrastructure to run their own games. </p> <P> With big data analytics, the disruptive impact has just begun. Look at its use to analyze social media sentiment. Three-fourths of <i>IW 500</i> companies use social networking tools to collaborate with customers and suppliers, up from 42% in 2009. But just 29% use sentiment analytics to assess what people are saying about their companies and products on social and other sites. Another 39% have sentiment analytics in pilot testing or plan to roll it out within a year, but a third have no plans to use it. </p> <P> Forty percent of <i>IW 500</i> companies put better business intelligence for employees among their innovation priorities, but that number has barely budged in recent years. More telling is how IT is using analytics--like at Beth Israel Deaconess Medical Center, the No. 1 <i>IW 500</i> company, where CIO John Halamka is daring to give more clinicians access to huge amounts of data to run queries. Speed of processing has changed the rules for analytics: A clinician can search BIDMCs 200 million data points on 2.2 million patients for how many have breast cancer and took ACE inhibitors, and the answer comes back in three seconds.</p> <P> The innovators realize the rules for IT have changed, and CIO roles are changing accordingly: One-third of <i>IW 500</i> CIOs now have formal responsibility for innovation in their companies, more than double the 16% who did in 2009. </p> <P> <center><img src="http://twimgs.com/informationweek/1343/343IWK_CSart_v2.jpg" width="611" height="1740" alt="InformationWeek 500 Data Charts " hspace="0" vspace="0" border="0" style="margin-bottom:7px;" /><br /></center></p> <P>  <center>Go to the story:<br /> <b><a href="http://www.informationweek.com/global-cio/interviews/how-the-informationweek-500-are-chosen/240006826 ">How The <em>InformationWeek 500</em> Are Chosen</a></b></center></p>  <p>  <center><a href="http://www.informationweek.com/1343"><img src="http://twimgs.com/infoweek/1343/1343_500_return_to_homepage.gif" width="299" height="45" hspace="0" vspace="0" alt="Go to the 2012 InformationWeek 500 homepage" title="Go to the 2012 InformationWeek 500 homepage" border="0"/></a></center></p>  <P>2012-09-12T00:01:00ZUPS Empowers Package RecipientsNew service lets customers provide on-the-fly instructions to drivers, giving UPS another tool to compete for growing volume of e-commerce shipments.http://www.informationweek.com/news/240006802?cid=RSSfeed_IWK_authorsUPS's tech-driven innovations have been centered on package shippers and employees, but a breakthrough new service focuses on the person receiving a package.</p> <P> Called UPS My Choice, it lets customers set up a two-hour window in which they want to receive a package. It also lets them provide unique instructions for each package they're getting--leave it by the side door, hold it at a UPS store--and change delivery options while the package is in transit. Customers enter instructions through a Web or mobile app, and they're sent directly to the mobile device that each UPS driver carries.</p> <P> That might not sound hugely complicated until you consider the scale of UPS. It moves 15 million packages on a typical day, 20 million or more during the holidays. UPS optimizes the routes to deliver those packages, and now its systems must factor in changes in real time if a customer decides to, say, reroute a package to be held at a UPS store. Letting GPS many millions of package receivers "essentially shift on demand what the driver was doing every day was a big leap for us," says CIO Dave Barnes.</p> <P> <strong>Technical Challenges</strong> <P> My Choice gives UPS another tool to compete for the growing volume of e-commerce shipments. The basic service provides alerts, approximate delivery times, holds, and the option to reroute delivery for a fee; a $40-ayear premium service includes twohour delivery windows, the option to give the driver instructions on where to leave a package, a delivery planner, and more. About 1.65 million customers have signed up for My Choice. UPS has let shippers reroute packages en route since 2007, so it had the core systems, including Package Flow, which tracks a package through the UPS network, and the handheld mobile devices drivers use to get instructions.</p> <P> But package receivers presented new technical challenges, and in all more than 50 IT systems needed to be revised to offer My Choice.</p> <P>  <div class="inlineStoryImage inlineStoryImageRight"> <img src="http://twimgs.com/informationweek/1343/343IW500_BI_UPS_175.jpg" alt="Reroute that package" title="Reroute that package" class="img175"> <div class="storyImageCaption">Reroute that package</div> </div>  <P> For example, it's fairly easy for UPS to find a shipper's particular package because each package has a shipper ID number on it. There's no such number for the receiver. So UPS had to write algorithms to search its entire inventory to find all packages headed to Dave Barnes--and know that David Barnes and even D. Barns might be right, too--at a given address. And it needs to search not just the 15 million packages being delivered today but all those due in the days around it.</p> <P> UPS needed faster raw computing power, so it replaced servers with ones capable of much faster input/output operations, in part by using accelerator cards. It also uses in-memory database techniques to speed up searches. UPS teams work closely with tech vendors as they refine these kinds of technologies to "not let size and scale be an impediment" to new services like My Choice, Barnes says.</p> <P> UPS sees plenty of work still ahead. Its shipping network has been optimized for known events--which packages are headed where. My Choice shows UPS reacting in real time to changes. Barnes sees UPS using predictive analytics to react to events that haven't yet happened--like seeing a looming storm that will cause delays and starting to anticipate all of the ripple effects along the supply chain sooner. "We're moving in a big way in that direction," he says, "and it's really going to take big data even further."</p> <P> <center><a href="http://www.informationweek.com/1343"><img src="http://twimgs.com/infoweek/1343/1343_500_return_to_homepage.gif" width="299" height="45" hspace="0" vspace="0" alt="Go to the 2012 InformationWeek 500 homepage" title="Go to the 2012 InformationWeek 500 homepage" border="0"/></a></center></p>