Hi- I’m Joe Homnick, principal owner of Homnick Systems and a Microsoft Gold Certified Partner for Learning Solutions, located in Boca Raton, Florida.  I am a Microsoft Regional Director Ambassador and trainer for the Microsoft Metro program, which targets early adopters of Microsoft technologies for the last five years.   

I believe that as the world moves out of this recession, extending productivity through IT will be a major means for allowing business enterprises to succeed in a more competitive market and innovation should not be sacrificed.   The results from the recent Microsoft survey (conducted by Harris Interactive) of 1200+ IT professionals, implementers and decision makers from the U.S., UK, Germany and Japan show ominous clouds hovering over investment in technology.   Per the study 55% say the economy has changed the role of IT and 51% say that budget cuts are the biggest barrier to innovation, while only 22% say giving the business a competitive edge is their top priority.  It appears that with reduced budgets, IT is much more concerned with “keeping the lights on” and are not focused on innovating as much as they have in the past.  

There are two major areas that IT should look at in leveraging their dwindling budgets while still innovating; one is a new technology thrust and the other a tried and true method to extending productivity and innovation.  To more efficiently implement innovation, businesses should be looking at a hybrid method of building their infrastructure into the future by including the concept of Cloud Computing along with the on-premise approach.  Education is another area that should be invested in, so that innovations can be realized within the existing infrastructure and informed decisions about future directions in hybrid infrastructure expansion can be made.

Cloud Computing is quickly becoming a reality with major investments by Microsoft, Google and Amazon.  Cloud Computing allows you to efficiently extend and scale your IT infrastructure into a shared internet environment and overcome two major investment concerns when an enterprise invests in new technology.  The first of these concerns is the Cash Flow Curve of Costs to Utilization for new technology investments.  The typical curve for private cloud cash expenditures is as follows:

Typically there are large cash expenditures for infrastructure well before there is utilization related to revenue/efficiencies to be realized on the private cloud investments.  As utilization of the infrastructure takes place there is typically a period that occurs where over utilization of the resources occurs, which results in another capital expenditure to give greater capacity than is needed until once again utilization out strips capacity and the whole process of underutilization/overutilization takes place again.  The Cloud Computing approach smoothes this Cost/Utilization by allowing the enterprise to only purchase the amount of computing power that they need to meet utilization requirements.  Another issue that Cloud Computing addresses is daily Periodicity of Demand.  The typical demand curve in a fully utilized system looks like the following:

The Y axis shows a measure of infrastructure capacity based upon simultaneous users while the X axis shows time within a day.  As can be seen, the system is underutilized (yellow) through the majority of the day with a couple of spikes of overutilization (red).  Of course, the overutilization spikes carry the added inefficiency of a not optimal computing environment.  The Cloud Computing platform with its on demand scalability and pay as you go pricing model address both the cost curve and periodicity of demand concerns related to IT infrastructure expenditure.

Education is usually one of the first IT budget line items to be cut and this approach has a very negative effect on efficiency and innovation within IT.  There are major concerns that return on the training investment is not sufficient.  This is due to a consistent failure of the online training approach to deliver the needed skills while the expense of tried and true instructor led training is considered too high.  The instructor led training expenses of lost time and travel can be mitigated by planning your training to take place locally or even having an instructor come into the enterprise.  A hybrid method of local instructor led classes and take home labs with online assistance can greatly alleviate these education costs while still delivering the knowledge transfer required in maintaining efficiency and creating innovation.

As IT moves into a more limited budget cycle, hopefully it will look to a hybrid method of implementing infrastructure with a mix of private cloud and public cloud computing along with hybrid method of local instructor led training with online supported labs.  This will allow for the efficiencies and innovation that can fuel productivity within the business enterprise, even within a constrained budget.