Strategic CIO // Executive Insights & Innovation
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12/19/2008
06:37 PM
Chris Murphy
Chris Murphy
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Dell CIO: In Search Of Infrastructure Management Innovation

I spoke with Dell CIO Steve Schuckenbrock today, who said this about the $1.2 trillion a year companies spend on IT infrastructure. One-third is on hardware, where Moore's Law relentlessly drives improvement. The other two-thirds is spent managing infrastructure, and there's "no innovation to speak of" in that arena. Too harsh?

I spoke with Dell CIO Steve Schuckenbrock today, who said this about the $1.2 trillion a year companies spend on IT infrastructure. One-third is on hardware, where Moore's Law relentlessly drives improvement. The other two-thirds is spent managing infrastructure, and there's "no innovation to speak of" in that arena. Too harsh?I don't necessarily think so. But first, the context on Schuckenbrock's assessment.

In addition to being CIO, Schuckenbrock is president of Dell Global Services, which includes infrastructure management. Dell's making a sizable bet on services, spending about $500 million over the past 12 months, along with several acquisitions, to build capability for remote infrastructure management. That's where functions such as provisioning software, patch management, archiving, and antivirus updating are done by Dell remotely, automatically, and without software on the PC being managed.

Dell envisions this services push letting it repeat the PC glory days, where Dell's direct sales strategy and superior supply chain shook up an established industry. "If you look at the services industry today, it's archaic, it's labor intensive, it's not a very efficient supply chain, and it needs the same kind of disruption," Schuckenbrock says.

Schuckenbrock, a former co-COO of EDS, paints Dell as the ideal disruptor to the services supply chain, since it doesn't have a revenue base to protect in the conventional outsourcing model. Some worry that means Dell doesn't have the breadth to compete with the likes of Hewlett-Packard, which acquired EDS. Plenty of companies, including the Indian outsourcing companies, are jockeying to offer remote infrastructure management.

Regardless of who provides such services, or even whether they stay in house, Schuckenbrock's broad point -- that there's a need for fresh innovation in infrastructure management -- rings true. In too many companies, IT remains the cobbler's child, helping other business units drive automation and process improvements but not doing the same for its own IT operations and processes. Managing IT remains a people-intensive process at many companies, something that begs for change as the pressure grows to cut the cost of keeping the IT lights on.

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