a smac in the face for enterprise software …...cloud (smac) have involved, and will involve...

Phone: +1-610-644-2856

Measure. Optimize. Deliver.

softwarevalue.com

A SMAC in the face for enterprise

software development?

Michael HarrisPresident & CEO

©2016 DCG Software Value 1

Who are these people?

“It’s frustrating that there are so many failed software projects when I know from

personal experience it’s possible to do so much better – and we can help.”Mike Harris, DCG President

Our Vision:

A future state in which the value of every software

initiative is visible to the business.

Our Mission:

To provide powerful information empowering your

organization to control successful outcomes.

©2016 DCG Software Value 2

The DCG Story

THE BASICS• Founded 1994• International (U.S. and U.K. Offices)• 20+ Employees [+Industry Thought Leaders]• Industry Leaders [Software Consulting Services]

OUR SIGNATURE• Centers of Excellence• Build, Operate, Transfer (BOT)• Consulting

HIGH-LEVEL FINANCIALS• Profitable• Small Business• Self-Funded• Growing

OUR REPUTATION“I would definitely describe them as experts in their field. We are much more disciplined now than we were before, much more."

- Bob Lento, President, Convergys Information Management

OUR EXPERIENCE• Combined 50+ Years Experience• Authors of Publications and Books Used as Industry Guidelines• Frequent Guest Speakers at Industry Conferences

©2016 DCG Software Value

What’s He Talking About?

• Social media, mobile, analytics and

cloud (SMAC) have involved, and will

involve (phew!), a lot of software

development.

• However, it’s different from the

enterprise software development

we’ve been doing for the past ten

years.

• We will identify some changes that are

occurring and predict some that are

likely to occur.

• We will provide some ideas for how

organizations should respond,

particularly for improving the flow of

business value.

3


The SMAC in the Face

4

SaaS

Enterprise Software Dept.

For XXX

Corp.


The SMAC in the Face

• IT is not focused on value

– Software development is often driven by technology and completion date

• IT bases software development projects on the following:

– How difficult the project is

– How many and which resources the project will require

– Who shouts the loudest to get it

• Findings from DCG analysis of more than 1,500 software development projects in 2 years

– Median cost for a Fortune 500 company ranges from $114,000 - $164,000

– Most companies have a sense of the average cost of their projects, but it is probably unrealistic

– Very few companies know the range of value of their projects

5

The future is lots of small projects/stories:

How to ensure value and avoid herding cats?


Digital Enterprise Evolution

6

Mainframe Client-Server LAN/WAN/Internet New Ecosystem

Processing Power

Processing BoxData/Content

Software

TIME

Se

rvic

es

Co

mp

an

yS

taff

Custo

mers

Other

People

Other Companies

New

Services

TH

E I

NT

ER

NE

T O

F T

HIN

GS


A Different View?

7

Source: “Internet of

Cores” by Saied

Abolfazli, Zohreh

Sanaei and Irena

Bojanova, IEEE IT

Profesional Magazine,

May/June 2015


A Different View?

8

Source: “Intelligent

Energy Industrial

Systems 4.0” by

Patricia Robison,

Manjusri Sengupta and

David Rauch, IEEE IT

Profesional Magazine,

May/June 2015


The Internet of Things

• Michael Schrage, MIT Sloan: “The glib way of thinking

about the internet of things is social media for machines.”

https://youtu.be/qWR32v5uaI8

• Final nail: Business and IT can no longer be separated:

– Software will be the lifeblood of the business

– Data will be the oxygen

• Arpan Pal, writing in IEEE’s IT Pro (May/June 2015):

– Scalability: Leverage Computing at the Edge

– Privacy: Make it Measurable

– Affordability: Crowdsourced Sensing

– Context-Awareness: What it Means for IoT Analytics

– Ease of Development: Address Complexity

– Security: Why it’s Different for the IoT

9



What Are the CIOs Saying?

• Analyst firm Gartner estimates that 55% to 75% of all ERP projects fail

to meet their objectives.

• “We are not taken seriously enough in the organization …”

– “CIOs continue to talk a different language than business”

– “In C-Suite, Earners have more clout than Spenders …”

– “The CFO has most clout of all as the steward of the organization’s

financial assets.”

• The voice at the table that many CIOs complain they don’t have is

being usurped by the CDO – the Chief Digital Officer.

– This role IS seen as an earner not a spender

– This is a transformational role

• The CIO role will decline in importance and value – it may disappear.

10


The CDO

• Ahead of the Gartner Enterprise

Information & Master Data Management

2014, held March 12-13 in London,

Gartner predicted that by 2015, 25% of

large global organizations will have

appointed CDOs.

• Debra Logan, research VP and Gartner

Fellow, said that there are more than 100

CDOs serving in large organizations

today [2014], which is more than double

the number in 2012.

• Gartner has also found that 65% of

CDOs are in the U.S. while 20% are in

the U.K.

• See http://www.chiefdigitalofficer.net/

11

http://www.chiefdigitalofficer.net/


Security, Privacy, Usability and Software

Security

PrivacyUsability

12

Security

PrivacyUsability


Business and IT Must Focus on Making the

Value of Software Visible

• All stakeholders must know the business and economic value of the

software development investment and work toward the same goals

• Business units and IT must collaborate to define “value” for each

initiative. Accountability will be essential to monitor progress and

assure successful attainment of the goals through each software

investment

• Most software development will continue to be in-house customization

BUT much of the source code delivering the functionality will be

external. The monolithic, in-house systems of old (e.g. ERP, HR) could

become a competitive disadvantage if not kept up to date (at a cost)

• Charlie Asaujo: “… In 5-10 years, 80% of what is in-house today will

move out. The transition will be hard work. IT as we know it is dead.

Managing the value supply chain will be the future for developers

wanting to stay in the business.”

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Managing the Value Supply Chain:

How to Visualize the Value?

14


The Value Visualization Framework (VVF)

(www.valuevisualization.com)

• VVF is a 5-step process

– Creates requirements or stories to “Visualize the Value”

– Focuses on the following:

STEP 1: Define the units of value delivery

(e.g. number of subscribers, hours saved in the process)

STEP 2: Define the value of the project in specific units

(e.g. 17 new subscribers once deployed)

STEP 3: Define the “size”

(e.g. 100 story points)

STEP 4: Define the cost of delay of the implementation challenge, including level of complexity, duration, etc.

(e.g. $2,000 penalty for a missed deadline)

STEP 5: Quantify the economic value once deployed

(e.g. $30 per subscriber)

15


New Software Ecosystem Hypotheses:

1. Software development will be driven by APIs: Best FADS will win.

– Functionality

– Availability

– Dependability

– Security

– Bridget Karlin, Intel, “Monetize with API’s”


2. Business has to change its processes and governance for the new

SE

3. Businesses must choose between “command & control” and

“experiment & evolve” for their staff’s software (and their clients?)

4. With much less (minimal?) control over source code, businesses will

need to differentiate themselves around the “edges”

16



Stop! What Did He Just Say?

• Social media, mobile, analytics and

cloud (SMAC) have involved, and

will involve (phew!), a lot of software

development.

• More code external to the business

• Smaller projects

• APIs

• New processes and governance

• Experiment & evolve

• Differentiate on the edges

• Less Enterprise, More Enterprising!

17


Contact Us

Email: [email protected]

Phone: 1-610-644-2856

http://www.softwarevalue.com

18

@DCGSWValue

/DCGSWValue

/company/DCG-Software-Value

Measure. Optimize. Deliver.

softwarevalue.com

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a smac in the face for enterprise software …...cloud (smac) have involved, and will involve...

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