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A New Angle on the Classic Challenge of Retained IT

By Pierre Moncassin

Pierre Moncassin-cropWhen discussing the organization models for managing cloud infrastructure with customers, I have come across situations where some if not all infrastructure services are outsourced to a third party. In these situations my customers often ask – does your (VMware) operating model still apply? Should I retain cloud-related skills in-house? If so, which ones?

The short answer is: Yes. The advice I give my customers is that their IT organization should establish a core organization modeled on the “tenant operations” team as defined in Organizing for the Cloud, a VMware white paper by my colleague Kevin Lees.

Let’s assume a relatively simple scenario where a single outsourcer is providing “standard” infrastructure services — such as computing, storage, backups. In this scenario, the outsourcer has accepted to transform at least some of its services towards software-defined data center (SDDC), which is by no means an easy step (I will return to that point later).

For now let’s also assume a cooperative situation where customer and outsourcer are collaboratively working towards a cloud model. The question is — what skills and functions should the customer retain in-house? Which skills can be handed over to the outsourcer?

The question is a classic one. In traditional infrastructure outsourcing, we would talk about a “retained IT” organization.  For the SDDC environment, here are some skill groups that I believe have to be preserved within the core, in-house team:

  • Service Design and Self-service Provisioning is clearly a skillset to keep in-house. The in-house team must be able to work with the business to define services end-to-end, but the team should also be able to grasp accurately the possibilities that automation offers with software such as VMware vCloud Automation Center.  Though I am not suggesting that the core team needs to be expert in all aspects of workflows, APIs or scripting, they do need a solid grasp of the possibilities of automation.
  • Process Automation and Optimization.  A solid working knowledge of automation software is useful but not enough.  The in-house teams are required to decide which processes to automate and how. They need to make business-level decisions. Which processes are worth automating? What is the benefit of automation versus its cost?
  • Security and Compliance is often a top priority for cloud adopters. The cloud-based services need to align with enterprise policies and standards.  The retained IT function must be able to demonstrate compliance and where needed, enforce those standards in the cloud infrastructure.
  • Service Level Management and Trend Analysis. Whilst the retained IT organization does not need to be involved in the day-to-day monitoring and troubleshooting, they need to be able to monitor key service levels. Specifically, the business users will be highly sensitive to the performance of some business-critical applications. The retained IT organization will need to keep enough knowledge of these applications and of performance monitoring tools to ensure that application performance is measured adequately.
  • Application Life Cycle (DevOps). We have assumed in our scenario an infrastructure-only outsourcing — the skills for application development remaining in-house.  In the SDDC environment, the tenant operations team will work closely with the application development teams. Amongst other skills, the retained IT will need detailed knowledge not only of application provisioning, but also the architectures, configuration dependencies, and patching policies required to maintain those applications.

I have reviewed skills groups needed as more automation is used, but there will be less reliance on skills that relate to routine tasks and trouble-shooting. Skills that can typically be outsourced include:

  • Routine scripting and monitoring
  • System (middleware) configuration
  • Routine network administration

The diagram below is a (very simplified) summary of the evolution from traditional retained IT to tenant operations for SDDC environments.

Retained IT modelIt is also worth noting that the transformation from traditional infrastructure outsourcing to SDDC is a far from obvious step from the point of view of an outsourcer. Why should the outsourcer invest time and cost to streamline services, if the end customer has already contracted to pay for the full cost of service? Gaining buy-in from the outsourcer to transform its model can be a significant challenge. Therefore it is prudent to key to gain acceptance either:
–  early in the contract negotiations, so that the provider can build in a cloud delivery model in its service offering,
– or towards the end of a contract when the outsourcer is often highly motivated to obtain a renewal.

Finally outsourcers may initiate their own technology refresh programs, which can create a win-win situation when both sides are prepared to invest in modernization towards SDDC.

3 Key Take-Aways

  1. Organizations that undertake their journey to SDDC with an outsourcer are advised to establish a core SDDC  organization including most tenant operations skills; a key focus is to leverage automation (whilst routine, repetitive tasks can be outsourced).
  2. The exact profile of the tenant operations (retained IT) will depend on the scope of the outsourcing contract.
  3. Early contract negotiations, renewals, or technology refresh can create opportunities to encourage an outsourcer to move towards the SDDC model.

———
Pierre Moncassin
is an operations architect with VMware’s Global Operations Transformation Practice and is based in the UK. Follow @VMwareCloudOps on Twitter for future updates.

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  1. Pingback: Fresh Links Sundae – September 28, 2014 Edition from David Lowe of Disciplined IT and Actionable ITSM | Disciplined IT

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