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HP Software's community for IT leaders // October 2013
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4 keys to the software-driven era

Every enterprise more sophisticated than your kid’s lemonade stand can use the simplicity and flexibility of software to transform their industry. Here’s how the CIO steps up in the software-defined enterprise.

The bottom line

What: The software-defined enterprise is what most businesses don’t realize they’re turning into.
Why: Whatever you sell, software is increasingly how you deliver it, how you measure it, and how your customers interact with you.
More: Dig deeper into your IT/business transformation with HP Software’s Professional Services team.

For the hard-nosed executive who thinks software is a distraction, consider that with more than 13,000 software developers, leading global bank HSBC has more developer muscle working on better trading algorithms than Microsoft has assigned to improving Windows. Or that a traditional retailer like Walmart differentiates itself using thousands of developers to orchestrate the dance of retail, social, and mobile channels.

Even that most “hardware” of industries, manufacturing, is cutting labor and production costs through smarter software and 3D printing. Software has become integral to nearly everything we manufacture. The radio and navigation system in the current S-Class Mercedes-Benz requires more than 20 million lines of code, and most future cars will require 200 to 300 million lines of code.

“Ultimately, every enterprise will be a software enterprise,” says Paul Muller, VP and chief evangelist for HP Software. “Regardless of the industry you’re in, your company will be disrupted and ultimately transformed by software, and the sooner you act on it, the greater the opportunity to be the disrupter versus the disrupted.”

What’s good enough for GE …

It’s no surprise that the General Electric CEO, Jeff Immelt, is betting big on the power of IT and analytics: “I’m going back to school on big data and software,” he told an Australian newspaper. And he has backed that with a nearly $1 billion investment in about 50,000 developers and data scientists over recent years.

The biggest visionary flash is for your business leaders, who can no longer afford to think about IT as a utility—a service peripheral to what the enterprise does. “Rather, software is part of the product,” Muller says, “something leaders need to understand—and thus exploit.”

This of course makes the role of IT-savvy leaders more vital than ever before—and offers a few things to think about. Developers, designers, and even data scientists have to be closer to the strategy-setting and innovation process. This is a critical first step to leveraging their expertise—identifying ways software can differentiate or simplify the product, service, or process that matters.  Here are four ways to start that ball rolling.

1. Trust your maturing LOB colleagues.

“Your LOB users are probably more open to the idea of the software-defined enterprise than you think,” Muller says. Most recognize that the web and apps are the front door to your enterprise, and they want to be able to quickly, securely innovate to provide a compelling user experience. Also, managers across the enterprise are becoming much more savvy about tech and its value to their mission. They can now manage their own software spending, taking more ownership over the choice of designers, developers, testing, and even hosting.

Rather than react to that shift in a piecemeal fashion, your IT team has the opportunity to provide thought leadership, establishing education courses and convening design teams to help shape their thinking in a consistent way across the organization.

2. Release the change.

Consumerization has dramatically eroded centralized IT control. The former ivory tower of “No!” now has to enable self-service change without compromising service quality. This creates two contradictory challenges—stability and speed—and one key solution: smarter automation. With 10 to 100 production changes a day, you can’t run each through a rigid Change Advisory Board review when the change itself is largely automated.

Instead, the CAB must focus on preparing for and testing changes to the policies and the automation itself, with manual management performed by exception.

3. Transform your enterprise into APIs.

The software-defined enterprise exists when application programming interfaces come together to create platforms on which innovative developers can create new products and services.
 
A software-defined enterprise has to apply this concept to everything that it does—opening up incredible possibilities for innovation and agility. Innovators such as Netflix already provide a set of self-service capabilities so fine-grained that there’s virtually nothing that a talented programmer can’t accomplish with time and creativity.

4. Facilitate collaboration and flexibility—and transform the internal culture.

With IT not just a procurement place, but a broker of shared services to the business, collaboration with business managers and users plays a huge role. This gives rising importance to “business engineers” who truly understand the business processes and application needs.
 
Flexibility is equally key: the biggest change for software-defined businesses will be the nature of change itself. There will be much more of it, and it will move from being infrequent, punctuated change to continuous and incremental progression. You’ll need to flexibly deal with a large number of small changes instead of—or perhaps as well as—a small number of large changes.

Developing the new enterprise

The “software-defined” concept has been used over the last two decades by technologists to transform everything from radio to the data center. It was complex jargon for a simple idea: lower the cost, risk, and time required to implement change by making infrastructure programmable.
 
The ultimate goal for the software-defined enterprise is the same: make the entire enterprise “programmable,” letting employees, customers, and partners “self-serve” and combine the capabilities of the entire organization—information, products, services, and platforms—directly. With some creativity and a good developer, you can redefine your organization for a new era in which your software is the face, and often the heart, of your business.

For more on the art of getting the most from your software and using industry-leading best practices to transform your increasingly software-defined organization, meet HP Software’s Professional Services team.


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