HP’s new AE management mantra

Sources say that HP spends nearly 60 percent of its R&D budget (approximately $2.6 billion per year) on research for Adaptive Enterprise. RAHUL NEEL MANI says that even if this is a little exaggerated, HP’s bet on Adaptive Enterprise is so heavy that it can create new fortunes for the company

The Adaptive Enterprise strategy has helped customers integrate heterogeneous technologies, cut IT costs and automate responses to real-time business demands, says Bithin Talukdar

IT’S been nearly a year since HP introduced its Adaptive Enterprise (AE) strategy for enterprises after the Compaq-HP merger. At a recently held HP Software Universe conference in Germany, the company announced about 40 new products and services designed to support the AE vision. HP says that these products will provide customers with software and services to create IT environments that grow and shrink according to business demands. On the other hand, where IBM and Sun with their utility computing strategies—On Demand and N1 respectively—are trying to lure users, HP is offering a competitive edge by hawking better management of these services. But what benefit will the end-user gain by going in for this model of AE vis-a-vis the On Demand and N1 models? Will it not be appropriate to say that in terms of Indian conditions and IT usage patterns, AE solutions are really far off?

HP’s approach to adaptive management integrates people, process and technology to run IT as a business and automate the dynamic link between business and IT. “Extending its AE strategy, HP has introduced more than 40 new management services and software products to help customers integrate heterogeneous technologies, cut information technology operation costs by up to 30 percent, and increasingly automate responsiveness to real-time business demands,” says Bithin Talukdar, market development and alliances manager, Software Business Global Unit, HP India.

The company says that adaptive management breaks the cycle of endless maintenance costs, so CIOs can once again invest in innovation. Management services like ITSM can help customers create a lean, responsive IT operation, while management software provides the key to linking business processes and applications down into the raw hardware. For any CIO expected to do more, investing in management is a fast path to controlling costs while becoming a more adaptive enterprise.

Explains Talukdar, “The combination of people and resources comprises 75-80 percent of IT budgets. It is our belief that we will be able to help customers bring it down to 55-60 percent, thus freeing precious resources to work on new IT initiatives, making IT strategic to the business.” The most negative scenario is that the dollars required for ongoing maintenance of an existing infrastructure will prevent investment in new, more strategic areas, and that’s where AE helps a lot. Talukdar says that adaptive management is the most powerful means of bringing down this cost and creating opportunities to invest in activities that will grow the business and enable it to be more successful. “Adaptive management creates a tight automated linkage between the status of the computing infrastructure and the ability to allocate computing resources,” he says. This is not all. The ultimate vision of HP is to have an adaptive world where IT is synchronised to business cycles, objectives and requirements. Call it a real-time enterprise or organic IT, it looks as if this is here to stay, though maybe it will take some more time to penetrate the corporate boardrooms of Indian enterprises.

HP can give a definite technology perspective, but what it really needs is to get into boardrooms and explain how its technology addresses critical business issues of diverse interests. To translate that into profits, HP has to ultimately ensure that adoption is at a higher level. Talukdar says that from the software perspective, HP preaches a definite approach for IT management. “The first step is that when you plan you plan top down. When you implement you implement bottom up. Involvement of top management is the first buy-in for such long-term projects,” says Talukdar. According to the company, the short-term focus should be on stability. This should typically cover configuration management, network management, service desk, computer operations, problem management, release management, computer installation and acceptance, testing IT services, operational use and change management. The medium-term focus should be on managing service levels, while the strategic focus should be on achieving a quality organisation. “Have a clearly-defined reference model to work with. Every organisation should have a reference architecture that takes into consideration IT processes on a horizontal axis, and data and infrastructure on a vertical axis across service management, task management, element management and mission-critical application integration,” says Talukdar. Recently, Sun also announced such reference architectures to help end-users achieve harmony in a heterogeneous network environment.

In this context it is relevant to point out that HP and SAP have proposed deeper collaboration to support large enterprises. The two companies are to deliver joint toolsets and methodologies to help enterprises efficiently manage heterogeneous IT environments. “By combining the necessary toolsets and methodologies from HP’s AE strategy and SAP’s Adaptive Business Service Strategy, the two companies will work to allow more effective management of customers’ heterogeneous IT environments—networks, systems, middleware, databases and enterprise software—to support the needs of adaptive business,” says Talukdar. Leveraging SAP’s business application and process management strengths and HP’s infrastructure management solutions for heterogeneous environments, the companies intend to provide customers with a superior managed application environment. The collaboration will be based on the industry-standard IT infrastructure library, HP’s IT service management reference model and management solutions, and SAP’s IT service and application management. Both organisations will deliver joint services to the customer.

HP is reportedly spending 60 percent of its R&D budget ($2.6 billion) on AE technologies, and about half of that is spent on creating management software to support an adaptive data centre. Where does the company spend so much—and why? “HP’s recent solution-specific announcements covered three key aspects of AE management. These were business-level management (BLM), application and service management (ASM) and infrastructure and resource management (IRM),” says Talukdar. Within these solution areas, new versions of software have been launched, including HP OpenView Network Node Manager 7.01, Glance Plus 4.01, Operations for Windows 7.X, IUM 5.0, Reporter 3.6, Service Quality Manager 1.1, Service Activator 4.0 and Smart Plug Ins for BEA Weblogic and DB2.

Industry watchers strongly feel that a part of HP’s strategy is acquiring technologies to build its OpenView management portfolio. The acquisitions could help HP fill gaps in software and deliver products to the market more quickly. HP’s AE vision is “the integration of people, processes and technologies to run IT as a business and automate the dynamic link between business and IT. Says Talukdar, “This vision requires management across all the three basic elements—infrastructure, applications and business processes. It is all about heterogeneous environments, for no enterprise bases its architecture on a single vendor alone.” He explains that HP has strong links and a history of alliance partners with whom it charts the future. In the past HP has acquired some technologies like Trinagy, Consera, Persist, Talking Blocs and Select Access. It also invests in partnerships: application vendors like BEA, Microsoft, Oracle and SAP; infrastructure vendors like Cisco, Intel and Nokia; and global system integrators like Accenture, Bearing Point, and Ernst & Young. “We are moving with speed and agility to bring the best solutions to help organisations achieve AE,” says Talukdar.

What reaction does the company see when it sells AE products/services/software to Indian users? What kind of market does it anticipate for the AE product in India? HP believes that building an AE is the only way to stay competitive in the times to come. “AE is a vision…it is not a product that you can buy,” declares Talukdar. “HP OpenView has been present in India for a little over four years. In this period we have come a long way. We believe that today the market has three basic categories of organisational requirements, and therefore solutions.” HP feels that 75 percent of all organisations look at IT as operations-centric, 20 percent as service-centric, and only 5 percent as business-centric. “Our interaction in the Indian market shows that most Indian companies are in Stage 1 of maturity. Many of the larger organisations in this category are focusing on outsourcing non-core activities like operations management through their facilities management vendor. Such managed services use our solutions to deliver the services, and that’s the market we would like to address,” says Talukdar. He adds that companies in the second stage of the maturity curve are looking at outsourcing services. Some of the services being outsourced are help desk services, network and systems management services, and application management services. “The final step will be the automation of the process linking business needs through software that drives adaptive and virtual infrastructure. 5 percent of organisations are working towards achieving this vision,” informs Talukdar.

But the real challenge is for HP to prove to customers what utility computing or an AE could mean for them. A lot of people don’t even know about utility computing as yet. HP needs to educate users. Most users are very opinionated about how they manage their network, so this isn’t going to happen overnight. But HP says it hopes to spur customers along by assuring them that its approach doesn’t mean a giant upheaval for their IT systems.

Meanwhile, companies like IBM and Sun are not sitting quiet. They are updating their utility computing strategies to catch up with the pace of technology. With its strong customer base, IBM also has an edge over others because of its in-house expertise in many areas, unlike HP, which has to depend on many of its partners. The recent announcement of reference architectures by Sun is another step towards strengthening its N1 strategy. One point that comes out from all this is that utility computing or on-demand computing makes good business sense if users have faith in their outsourcing partners.

rahul@expresscomputeronline.com