What a computer system organization should look like!
Friday, January 25, 2013
47.8 Million iPhones in First Quarter of 2013
Apple reports selling 47.8 Million iPhones in the first quarter of their 2013 fiscal year! Are your computer systems capable of supporting the iPhone for your customers, employees, or trading partners. With close to 200 million iPhones in use that is one big market place!
Wednesday, December 5, 2012
Programming Jobs in US Lowest in Recent History
In 1990 there were 595,000 Programming jobs in the US. Today there are less than 320,000 jobs. These numbers are from the US Bureau of Labor Statistics (http://www.bls.gov).
Many of these jobs have been outsourced to India, China, and other countries paying programmers less than 10% of the typical US salary.
As much as I hate the idea of outsourcing US jobs, there is little that any individual company can do to counter this. The only reversal on the trend in outsourcing will be taxation and regulation by government that addresses the issue. Until such time, I strongly recommend that companies get on board and outsource their IT in order to be competitive.
While I maintain that there is no single solution for any specific enterprise which each has their unique requirements, outsourcing and cloud computing should both be on the table as serious potential means of reducing costs while improving IT services.
Don't fall for the argument put forth by many internal IT folks, that offshore people are low quality and cause more problems than they provide benefit! That is simply not true. Offshoring requires strong management and controls at your location and within your company. Note that developers in India and China as well as some other companies are better educated and more highly skilled than the traditional US worker.
So tell me do you want to pay $80,000 and up (plus benefits) to a US worker with a high school education, maybe a year's worth of training a technical school, junior college, or worse a couple of weeks by an IBM SE, or a person with a Masters in Computer Science from Universities that rival MIT and people with IQ's and performance scores equalling or exceeding MIT and other major US universities for $10,000 per year (with no benefits).
The key in successful outsourcing is the agreements you have in place between you and your outsourcing contractor, statements of work governing each project, and clearly stated responsibilities for defect resolution. It is also your responsibility to provide very specific and accurate specifications as well as creating and executing formal test plans with review and acceptance by key business unit managers and executives.
The real key to success is your up front work and planning followed by your oversight on the execution. You can save millions of dollars.
Many of these jobs have been outsourced to India, China, and other countries paying programmers less than 10% of the typical US salary.
As much as I hate the idea of outsourcing US jobs, there is little that any individual company can do to counter this. The only reversal on the trend in outsourcing will be taxation and regulation by government that addresses the issue. Until such time, I strongly recommend that companies get on board and outsource their IT in order to be competitive.
While I maintain that there is no single solution for any specific enterprise which each has their unique requirements, outsourcing and cloud computing should both be on the table as serious potential means of reducing costs while improving IT services.
Don't fall for the argument put forth by many internal IT folks, that offshore people are low quality and cause more problems than they provide benefit! That is simply not true. Offshoring requires strong management and controls at your location and within your company. Note that developers in India and China as well as some other companies are better educated and more highly skilled than the traditional US worker.
So tell me do you want to pay $80,000 and up (plus benefits) to a US worker with a high school education, maybe a year's worth of training a technical school, junior college, or worse a couple of weeks by an IBM SE, or a person with a Masters in Computer Science from Universities that rival MIT and people with IQ's and performance scores equalling or exceeding MIT and other major US universities for $10,000 per year (with no benefits).
The key in successful outsourcing is the agreements you have in place between you and your outsourcing contractor, statements of work governing each project, and clearly stated responsibilities for defect resolution. It is also your responsibility to provide very specific and accurate specifications as well as creating and executing formal test plans with review and acceptance by key business unit managers and executives.
The real key to success is your up front work and planning followed by your oversight on the execution. You can save millions of dollars.
Wednesday, October 24, 2012
The importance of Tablets and Smart Phones
Dell just announced the hiring of Jai Menon, former IBM CTO of its Systems and Technology Group as its new CTO of its Enterprise Group. Dell like other PC makers are seeing the handwriting on the wall and adapting to tablets and smart phones which are rapidly replacing desktop and laptop PC's as the user interface to computer systems.
With Apple's new iPAD mini announcement along with devices from other Android based tablet providers it looks like the PC as a client driven device is rapidly diminishing.
Vendors like Dell are moving to backend server providers leveraging both Linux and Microsoft Windows based technologies, but also adding data storage via low cost advanced SAN's (Storage Area Networks).
This will have a very interesting impact on IBM who has always maintained an extremely high price point on its Intel based servers known as the xSeries. IBM has always been able to charge more money by providing services on top of the equipment and therefore selling a high price total solution to its customers.
Companies like Dell are responding with lower cost equipment with integrated software that reduces the need for vendor provided expert consultants.
While IBM may have been a step ahead of others by selling its client oriented PC business to Lenovo and retaining its server business, but lets see if it can adapt to this new low cost easy to use set of equipment from Dell and other competitors.
With cloud on the up swing and major could providers buying literally thousands of servers as they grow, and internal companies moving to a tablet client server driven environment the demand for low cost servers is increasing rapidly.
It shall be interesting to see how this all plays out. There is a strong message here however. If you are not looking at tablets along with Internet based server centric solutions for your employees and systems you need to take a closer look.
With Apple's new iPAD mini announcement along with devices from other Android based tablet providers it looks like the PC as a client driven device is rapidly diminishing.
Vendors like Dell are moving to backend server providers leveraging both Linux and Microsoft Windows based technologies, but also adding data storage via low cost advanced SAN's (Storage Area Networks).
This will have a very interesting impact on IBM who has always maintained an extremely high price point on its Intel based servers known as the xSeries. IBM has always been able to charge more money by providing services on top of the equipment and therefore selling a high price total solution to its customers.
Companies like Dell are responding with lower cost equipment with integrated software that reduces the need for vendor provided expert consultants.
While IBM may have been a step ahead of others by selling its client oriented PC business to Lenovo and retaining its server business, but lets see if it can adapt to this new low cost easy to use set of equipment from Dell and other competitors.
With cloud on the up swing and major could providers buying literally thousands of servers as they grow, and internal companies moving to a tablet client server driven environment the demand for low cost servers is increasing rapidly.
It shall be interesting to see how this all plays out. There is a strong message here however. If you are not looking at tablets along with Internet based server centric solutions for your employees and systems you need to take a closer look.
Friday, October 19, 2012
BIG DATA?
First of all if you are working with "Big Data", I'd love to hear from you.
I was recently involved in a discussion where old AS/400 based folks were debating the merits of relational database and SQL. It was a bit unbelievable since Dr Codd first published his papers on relational database architecture in 1970, 42 years ago! In the course of discussion the issue of modern alternatives to relational database systems came up.
This brings us into the topic of "Big Data". "Big Data" is defined by Volume, Velocity, and Variety. We are seeing data volumes in Petabytes (1000 terabytes) and Exabytes (1000 petabytes) materializing regularly.
The concept of "Big Data" first materialized in scientific computing circles where measurements in weather, aeronautics (i.e. wind or airflow on an airframe), medicine, and other industrial or scientific applications produced massive amounts of data that needed to be captured and analyzed, often in real time.
We then began to see social media sites like Facebook Google, Amazon, and others create unbelievably huge repositories of data. Facebook reports that it operates over 30,000 computers and captures log files of over 25 terabytes of data each day...
Today we are seeing Big Data move into commercial business enterprises. Consider the following:
I would really like your help in pursuing this line of thought and exploring the use of "Big Data" by commercial business enterprises. Send me your experience at: bobc@rjcancilla.com. Let me know if I can use your name or company name or if I should keep that info confidential. I'd really love to hear from you.
I was recently involved in a discussion where old AS/400 based folks were debating the merits of relational database and SQL. It was a bit unbelievable since Dr Codd first published his papers on relational database architecture in 1970, 42 years ago! In the course of discussion the issue of modern alternatives to relational database systems came up.
This brings us into the topic of "Big Data". "Big Data" is defined by Volume, Velocity, and Variety. We are seeing data volumes in Petabytes (1000 terabytes) and Exabytes (1000 petabytes) materializing regularly.
The concept of "Big Data" first materialized in scientific computing circles where measurements in weather, aeronautics (i.e. wind or airflow on an airframe), medicine, and other industrial or scientific applications produced massive amounts of data that needed to be captured and analyzed, often in real time.
We then began to see social media sites like Facebook Google, Amazon, and others create unbelievably huge repositories of data. Facebook reports that it operates over 30,000 computers and captures log files of over 25 terabytes of data each day...
Today we are seeing Big Data move into commercial business enterprises. Consider the following:
- Marketing applications that search the Internet for hits on a product or company name and then collect and analyze the content of everything found to determine the sentiment or attitude of the public toward the product or company.
- Consider huge international retailers who capture and monitor every sales transaction in every store (millions of transactions daily) to analyze product movement and revenue opportunities.
- Consider a major retailer who captures everything that a user does in their e-Commerce web sites, including products they look at but do not buy, searches they perform, every single keystroke and then analyze why visitors behave the way they do...
I would really like your help in pursuing this line of thought and exploring the use of "Big Data" by commercial business enterprises. Send me your experience at: bobc@rjcancilla.com. Let me know if I can use your name or company name or if I should keep that info confidential. I'd really love to hear from you.
Saturday, September 29, 2012
Where are the Programmer Jobs
I've been doing some research for my new book "Managing Computer Systems in the 21st Century" and came across a rather stunning fact at the US Bureau of Labor Statistics (BLS.gov).
First and foremost, it is interesting that various analysts like Gartner Group, Forrester and others report that IT budgets continue to fluctuate in the range of 1.6% to 1.8% of revenue and have since the 1970's.
At first glance that is not unusual, but when we look at hardware costs, we see that the cost of computer equipment which used to dominate IT budgets have dropped to a fraction of what they were in the 1970's.
You can now pay $1500 for computers that are several times more powerful than those that you had to pay well over $1 million for in 1974. This is not just packaged systems but also components of computer systems. How about a 1970's IBM 3330-1 Disk Drive with 100 mb capacity selling for approximately $25,970.00 (http://www.jcmit.com/diskprice.htm) compared to a 1 terabyte Western Digital plugable drive for $99.99 at Best Buy (http://tinyurl.com/8goq8sb).
Today's costs have shifted to labor costs. Often times a great deal of the modern IT department's costs are in labor for employees that support the hardware, operating systems, and other infrastructure and system software that are required to support the hardware today. Large companies will spend millions of dollars on this type of support while even small companies will spend a great deal of their budget on this type of non-productive but "necessary" overhead.
The programmer population in the US has decreased dramatically in the last few years. According to The US Bureau of Labor Statistics (http://www.bls.gov) The U.S. population of programmers fell from 363,100 people in 2010 to 320,100 in 2011 a loss of 43,000 people! Note that salaries have climbed steadily since 1922 when the BLS reported an average programmer salary of $63,690 to 2011 where the average grew to $76,010.
Where did the jobs go? This number includes ALL programmers, not just legacy programmers in COBOL or other legacy language (like RPG). It includes Java and C++ programmers. Note that major employers like Microsoft, IBM, HP, Google, Yahoo, and many other well known companies are outsourcing thousands of programming jobs to India and China.
Some major US corporations have followed suit, but most have tended to retain their legacy staff of developers. It is time to look critically at corporate IT organizations today and look at three critical opportunities to reduce costs and improve overall efficiency:
First and foremost, it is interesting that various analysts like Gartner Group, Forrester and others report that IT budgets continue to fluctuate in the range of 1.6% to 1.8% of revenue and have since the 1970's.
At first glance that is not unusual, but when we look at hardware costs, we see that the cost of computer equipment which used to dominate IT budgets have dropped to a fraction of what they were in the 1970's.
You can now pay $1500 for computers that are several times more powerful than those that you had to pay well over $1 million for in 1974. This is not just packaged systems but also components of computer systems. How about a 1970's IBM 3330-1 Disk Drive with 100 mb capacity selling for approximately $25,970.00 (http://www.jcmit.com/diskprice.htm) compared to a 1 terabyte Western Digital plugable drive for $99.99 at Best Buy (http://tinyurl.com/8goq8sb).
Today's costs have shifted to labor costs. Often times a great deal of the modern IT department's costs are in labor for employees that support the hardware, operating systems, and other infrastructure and system software that are required to support the hardware today. Large companies will spend millions of dollars on this type of support while even small companies will spend a great deal of their budget on this type of non-productive but "necessary" overhead.
The programmer population in the US has decreased dramatically in the last few years. According to The US Bureau of Labor Statistics (http://www.bls.gov) The U.S. population of programmers fell from 363,100 people in 2010 to 320,100 in 2011 a loss of 43,000 people! Note that salaries have climbed steadily since 1922 when the BLS reported an average programmer salary of $63,690 to 2011 where the average grew to $76,010.
Where did the jobs go? This number includes ALL programmers, not just legacy programmers in COBOL or other legacy language (like RPG). It includes Java and C++ programmers. Note that major employers like Microsoft, IBM, HP, Google, Yahoo, and many other well known companies are outsourcing thousands of programming jobs to India and China.
Some major US corporations have followed suit, but most have tended to retain their legacy staff of developers. It is time to look critically at corporate IT organizations today and look at three critical opportunities to reduce costs and improve overall efficiency:
- Cloud computing and eliminate not only computer hardware costs, but the labor cost of the people required to support these computer systems without providing a direct ROI to the enterprise.
- Outsourcing of software development to 3rd party firms. Replace a fixed annual cost for developers to a direct cost associated with development projects supported and budgeted by the business units.
- Open Source vs 3rd party vendor or in-house developed software. While open source is not free, it is vastly more cost effective and of much higher quality from a feature and functionality perspective than traditional 3rd commercial vendor systems (which are most likely 25 years old or more) and have no annual maintenance paid to the vendor. Note there are now open source applications for just about every business enterprise imaginable.
Wednesday, August 1, 2012
IBM Sells of Retail Equipment Business
If anyone had any doubts the direction IBM would head under Virginia Rometty's leader ship the article on the Wall Street Journal's Market Watch web site pretty much states the case. IBM has been quietly selling off its hardware manufacturing divisions with Printers, Disk, the PC Division, and now its Retail systems hardware!
How long before they sell of the computer business? Lest anyone have any doubts, IBM has become a technology consulting company. Services are now their entire focus for the future.
Quite frankly as sad as this may make some of us who saw IBM as the ultimate leader in computing equipment for many years, this makes total sense.
Today, IMHO, cloud computing is the future turning Thomas Watson's 1943 quote: "I think there is a world market for maybe five computers." into a reality!
Well there may be many more than 5 computers, but with cloud computing you no longer need computers in your place of business and today's millions of servers may shrink to thousands in cloud based provider data centers.
It is however interesting to theorize why IBM could not longer be profitable in businesses that it dominated for years. Being an ex-IBM'r, I can't help but wonder if it is IBM's management structure and the incredible overhead they have everywhere you turn (except in actual R&D) that makes them too inefficient to produce anything any more?
It is time to start carefully evaluating your use of IBM equipment and systems and look at alternative solutions if you have not all ready.
Tuesday, July 10, 2012
Time to Change the IT Name
IT or Information Technology has evolved into the standard for what businesses are calling their computer systems department today. It is fascinating to note that the term "Information Technology" was coined by Harold Leavitt and Thomas Whisler in their 1958
Harvard Business Review article entitled “Management in the
1980’s” which was a prediction of what things might be like in business management 30
years into the future.
Isn't it ironic that we use a 54 year old term to refer to today's 2012 organizations that manage computer systems for today's business enterprise?
Maybe its not so inappropriate considering the people working for the IT organizations of many business enterprises today. Many of your IT staff have been working for nearly as many years! I think it is time to modernize the name however and perhaps use something realistic like "Computer Systems".
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