Intrepid CIO Stu Laura mourns the death of Big Iron as he embraces the cloud religion.
We return to our ongoing conversation with CIO Stu Laura...
Anderson: Stu, how is this year different in the wild and wooly world of running IT at your shop?
Laura: Well, we're very sad this week. We had to put our mainframe down. It was past its prime. It was like saying goodbye to a very good friend. And I'm not ashamed to admit it -- I cried.
Anderson: Stu, Stu, Stu. Don't be ashamed. You and he had a very long time together.
Laura: She -- actually her name was Gertrude. And yes, we had been together for a long, long time. Gertrude was actually the fourth generation of IBM mainframes that we owned, all from the same sturdy stock, all who served us well.
Anderson: Well, you can always get another one. I'm sure that there's an adoption agency that handles that sort of thing.
Laura: I'm afraid not. We've moved on... to the cloud. And we don't think there's any turning back. We won't be buying servers. We will be buying precious little storage. We've severely cut back on software. We've had an epiphany: It's smarter to rent computing power than to own computers. And almost all of our productivity apps going forward will be in the cloud. Just think about the future -- no more golf outings with IBM, no more boondoggles with HP, no more beating up the EMC guys for a better price. I'm going to be one very lonely guy.
Anderson: But you'll still buy something from those guys, won't you?
Laura: Maybe. IBM is building some massive datacenters, and I'm sure we'll give them every consideration -- if their price is right. But remember that Amazon drops its prices it seems every 45 days, so it's hard to have loyalty to any of the cloud guys. We'll just let them fight it out.
Anderson: Sounds like you've returned to the time-sharing days of the 1960s.
Laura: Funny you mention that. In some ways it's true. But time-sharing was slow and its security was wishy-washy. The cloud today has better security, has better backup, and has some offerings we didn't know we needed -- until we saw them.
Laura: Analytics. We've spent a lot of money on analytics over the past few years. But it's going to make more sense to get those services from the cloud than continually reinvest on our own.
Anderson: What else?
Laura: Every year we spend a king's ransom on consultants to help us install and run our new hardware and software. We should spend maybe a third less this year and every year going forward. I'm going to miss those consultants... they always had bunches of funny stories to tell.
Anderson: Aren't you concerned about security? Or having your data God knows where?
Laura: There was always a feeling of comfort to peek out from my office and see my hardware humming along. It was kind of like having a room full of AK-47s: We knew we could go to war with our hardware and software weapons. And maybe the guys on Wall Street still feel that way, but they'll be following us as soon as the next economic downturn hits and they're under financial pressure. Now that doesn't count the guys doing high-velocity trading. They're nuts and have a black belt in spending.
Anderson: So your budget for computing is going down?
Laura: Curiously, no. We're just spending more money on applications, on more talent to build them quickly and integrate them with our other apps and data stores. We're concentrating on how social networks can impact us, and what we are doing about mobility. It's challenging and it's different, but my best people are on it.
Anderson: So did you have a nice ceremony for Gertrude, before you put her in the ground?
Laura: Thank you for asking. Yes, we did, it was truly a sad day. But we couldn't bury her.
Anderson: Why not?
Laura: The EPA wouldn't allow it. So I took her out to sea.
Anderson: Very touching. You buried her in the ocean?
Laura: Not exactly. She rides on my fishing trawler. I needed an anchor.
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Howard Anderson is on the faculty of the Harvard Business School. He was the founder of the Yankee Group and co-founder of Battery Ventures. He attempts to keep his rampant skepticism from morphing into galloping cynicism, a battle he seems to be losing. View Full Bio
The Business of Going DigitalDigital business isn't about changing code; it's about changing what legacy sales, distribution, customer service, and product groups do in the new digital age. It's about bringing big data analytics, mobile, social, marketing automation, cloud computing, and the app economy together to launch new products and services. We're seeing new titles in this digital revolution, new responsibilities, new business models, and major shifts in technology spending.