| About one year ago (end of Oct. 2002), the concept of
e-business on demand was launched, with big fanfare and a
big budget by IBM, as the new paradigm by which businesses
could redefine themselves in this era of constant change,
unprecedented risks – and global opportunity. On-demand
is a long-term strategy; the vision is grand, the promise
compelling, and the implementation daunting. One year has
passed. What has really happened in the on-demand arena?
The leader
IT analysts agree there is no question that IBM’s
on-demand initiative was, and still is, the most articulate
of the visions offered for the 21st century by the information
technology heavy-weights. IBM followed the launching of
the “on-demand era” with a massive ad campaign
(“Can you see it?”) and a strong re-focusing
of their sales and marketing machine, as well as offerings
of products and services and some changes to their internal
processes. The acquisition of Price Waterhouse Cooper was
the most notable move aimed at supporting the on-demand
strategy, as it helped to strengthen their management and
business consulting services. IBM has to their advantage
a very strong brand, unparalleled breath and depth of infrastructure,
a multitude of software and hardware products, and an all-important
differentiator - vast consulting and management capabilities
that they can deploy on a global scale.
All these not withstanding, there was no shortage of analysts
to sound alarm bells: IBM’s on-demand was seen by
some as a new way of packaging existing products and services,
adding complexity to offerings in order to pump up revenues,
or a new strategy to lock-in customers. Some warned that
the complexity of the tasks envisioned, the immaturity
of some of the technologies, as well as the immaturity
of many business processes on the client’s side,
were risk factors that could derail IBM’s on-demand
strategy.
The others
Hewlett Packard was, and still is, IBM’s main competitor
in the on-demand arena. If one year ago they talked mainly
about a Universal Data Center, (a hardware and software
solution for utility computing), now they have built a
complete vision around this and other existing products
and services. The vision and it’s “Demand More” advertising
campaign, was launched in early May under the name of Adaptive
Enterprise. The vision tries to build on HP’s strengths – an
array of already available smart technologies and automation
solutions that have self-managing and self-healing capabilities;
delivery of solutions based on collaborative partnerships;
and a pay-per-use pricing model. Some analysts identify
gaps in the HP’s vision and decry the fussiness around
it, acknowledging that HP’s consulting capabilities
are no match for IBM’s.
Sun Microsystems is also a strong player in the on-demand
arena through their N1 initiative and products such as
Sun One and Grid Engine Software for grid computing. Sun
is adept at creating an integrated system by “virtualizing” the
infrastructure needed to deliver utility computing. However,
this system is centered on Sun’s proprietary products.
Another weakness is the limited availability of the software
and services to sustain business services, outsourcing,
integration and support - Sun having to rely on third parties
to deliver these.
Computer Associates also came up with an on-demand vision
in the spring of 2003 - followed by a strong ad campaign
- that focused on the infrastructure products they have
to offer. CA’s strengths are their e-business portfolio
of applications, which are platform neutral, as well as
their in-house network management product called Unicenter,
which supports network management from a single location.
The development of storage and security products for the
enterprise, as well as a subscriber-based business mode,
has positioned CA as a compelling presence in the on-demand
landscape.
IBM also faces competition from Accenture, who are offering
business transformation at the high end of the market.
On the operating environment front, Dell is a competitor
for grid computing, due to the low pricing of their PC’s,
servers and storage devices. Again, the weaker point is
in their limited capabilities to offer and sustain support
services.
Other companies, while not having articulated an on-demand
vision, do have attractive products that could serve segments
of the on-demand market. Some are positioning their existing
proprietary products (notably Microsoft with their .net
development platform and enterprise servers) to take advantage
of the markets most likely to be shaped by the new paradigm
of on-demand.
The name of the game
The world of on-demand is still very much in its infancy.
Not only do new products and services have to be designed
and implemented, but also businesses have to be brought
up to speed as their processes and technologies are not
always mature and integrated.
Because on-demand is still new, there is a multitude of
products and claims and opinions on the market; but there
is little agreement on the definition of on-demand. Each
of the major players has come up with a vision that plays
best to their own specific strengths. And yet on-demand
cannot be dismissed as a plot of an industry that is trying
to pick itself up from the dust of the fly-high 90’s.
Amid the confusion and reluctance, the common note that
can be heard is that the way of doing business today and
tomorrow is changing because our world is changing - and
information technology is still the driving force, and
the enabler, of what is yet to come.
Tatiana Andronache is IT technical staff
for a large information technology company in Toronto, Canada.
She can be reached at tatiana.andronache@sympatico.ca
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