Some insights from Australian IT leaders…
This week we spent a lot of time meeting with IT execs across a wide range of industries in Australia. It was a great checkpoint on IT strategy in Australian business. In particular we had deep conversations with CIOs and CTOs in some of the largest financial services companies, telcos, engineering firms, federal government and retailers. When you step back and look at the challenges and strategies as a whole it paints an interesting picture. Here are some highlights:
- Blockchain is having a big impact on financial services (in some cases affecting market cap in the $billions of value). Payments is being disrupted. A small number of Australian FSI firms are investing in DevOPs, Agile, Bimodal and leaning in to fail-fast innovation leveraging private cloud to innovate. The majority are struggling with modernising legacy environments and systems. There was a lot of discussion around how Australian banks can start to follow what many global banks have been doing in shifting to software defined and hyperconverged architectures to replace legacy IT models, creating more agility for their businesses.
- The tension between digital transformation and the teams that “run IT” is increasing. Multiple companies talked about how digital was trying to move at speeds that the Infrastructure teams are not ready to support. The comment that business is moving faster than IT came up multiple times, both from application teams and infrastructure teams.
- Government CIOs want to leverage shared private cloud, transform their IT towards on prem private cloud, and in certain use cases (particularly non-secret standardised apps) leverage public cloud for services like office 365. BTW – awesome that Dimension Data has launched their gov cloud to help with all this!
- Big recent adoption of two technology trends in the retail industry (1) hyperconvergence for both remote data centres and core data centre workloads (2) big data, analytics and Hadoop workloads for customer analytics. These workloads are shifting to private cloud and hosted private cloud (one of our great partners, Macquarie Telecom, is doing an awesome job here). Some of the public cloud use cases started out well but now the customers are looking to shift to on prem in order to get more real time with customer engagement.
- There’s a general trend in the mining industry in Australia to shift to converged architecture, build out service catalogues and automate a set of standard offerings. A number of these organisations had planned to move entire data centres a few years ago to public cloud. Now the shift is trending towards hybrid.
- The topic of consumption economics is big. Customers have been building IT systems for many years. Now they want to shift to buy (ie converged systems) rather than build but more pervasively towards consume. Waste is rife in the IT industry. Businesses have been funding capital projects only to find they have used 30% of their investment after 5 years. The transformation towards true utility consumption models for private cloud is happening as companies shift the risk or problem of technology consumption to vendors. Buy and plan for 5 years is shifting to pay as you use. Hyperconvergence lends itself really well to this as it fits really well with unpredictable growth and decline models for IT.
One of the biggest surprises was how only a small number of large Australian companies were embracing Silicon Valley style IT models – OpenSource, commodity architectures built around composable containers, DveOps, Agile. We heard a lot of stories about how large US companies are looking at what the startups are doing and borrowing these ideas. With the exception of a few innovative companies, these new models seem to still be on the “emerging” trend in Australia.
A great week with a lot of really interesting insight into how IT strategy and culture is shaping up in Australia.