How complexity spilled the oil

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Notice for regular readers (thanks!) I did not write or influence this headline in any way. If you follow the link you will see it is all the work of one of the most authoritative sources global research companies, Forrester, via the, ever reliable, Computerworld who will keep you up to date on IT and general “geekery”.

If the subject matter looks familiar that is precisely because IT IS! I have written about this specific incident in the blog on several occasions and from a couple of perspectives, going back to the days when it wasn’t fashionable NOT to have a daily dig at BP and poor wee Tony Hayward: a man whose, now legendary, gift for miscommunication, could have been learnt at piñata finishing school!!!

They had just placed themselves, respectively, in the positions of “Big bad Corporate” and “sacrificial lamb” for an outraged global population and US administration desperate to find someone to BLAME. WE already suspected that so much of that rhetoric was about deflection…we ALL knew, from the collapse of global banking, that, when it came to Corporate activities, regulation was a fallacy, only an effective smokescreen and that risk management perceived a mere drain on potential profit and bonus potential…therefore tax revenue!

Current societies…are characterised by their extreme complexity at a moment in history in which traditional political institutions have lost much of the power, a power which has now passed into the hands of multinational companies with their relocation strategies. In this situation, a growing deregulation can also be observed which, in turn, redounds in the appearance of new risks and uncertainties.

Ulrich Beck

The best any of us concerned citizens could hope for was that this incident would be, not so much a disastrous oil spill as an inglorious watershed.

The Gulf oil spill of April 2010 was an unprecedented disaster. The National Oil Spill Commission’s report summary shows that this could have been prevented with the use of better technology. Read more of this post

Reshaping IT management for turbulent times

McKinsey Quarterly introduce A new model for managing IT combines factory-style productivity to keep costs down with a more nimble, innovation-focused approach to adapt to rapid change.

If your business IT system fails what is your business life expectancy!? How resilient is your business…how quickly can the impact be managed or how long can you survive?

But the lessons for business and  for society from this process are even greater!

You will notice consistent references to complexity in the following extract from McKinsey and if you aren’t clear what it is or why it is so significant let me know!!!

Complexity is the “unseen” problem-solving capability that underpins the functions that we perform and upon which we are reliant in our day-to-day lives. But, just like in IT systems, there is a sustainable limit of system complexity in proximity to which the system is unstable and unpredictable. Beyond which, unless new “structure” is added, functionality is lost…sometimes rapidly! Here are some complexity facts from Ontonix.

If you measure complexity you have an opportunity to manage it as you would other business risks.                      If you do not, the business remains unnecessarily exposed to uncertainty.

I wonder how long before this is recognised as a matter of Corporate Governance?  

Holistic business cases—cutting complexity through improved planning

For most companies, IT complexity increases gradually, as systems slowly evolve beyond their initial purpose, or through acquisitions, when new, sometimes duplicative systems are built for individual business units. Performance suffers over time, as ineffective IT slows product introductions, hampers customer interactions, and often makes post merger integration more difficult.

IT leaders recognize the adverse effects of complexity, but replacing these systems involves a substantial commitment of resources: hardware, new applications, and staff and vendor time. The economics are difficult to justify given the short time horizons of many tough-minded CFOs, particularly since tangible benefits are often realized only in the longer term.

To manage complexity, companies are starting to employ a more holistic business case model that goes beyond the traditional, IT-centric versions. This model includes realistic, verifiable cost–benefit analysis to assess the impact of new systems on the entire organization. Critically, such plans also require a road map for how future projects might build on the investment. At one company, for instance, the business case to deliver a unified view of all customer data showed how better information management could enable follow-on projects for marketing systems, enhancing cross-selling opportunities.

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Enormous cost of IT failure: $500 bn per month – complexity often cited as culprit!

In a recent whitepaper titled “IT complexity: Danger or Opportunity,” Roger Sessions calculates that each year the U.S. loses $1.3 trillion to IT failures. Worldwide it equates to $500 billion per month or $6.18 trillion. Sessions says the culprit is almost certainly IT complexity.

Whether the figures are accurate or not the message is clear: Prevention is key because the price of failure is huge

Problem: there aren’t many companies ready, willing or able to invest the kind of money required to replace existing systems.

Answer: monitoring and maintenance…but who (in their right mind) doesn’t already do this?

It does rather appear that costs of the magnitude that, prior to the virtual collapse of global financial markets, were (almost) exclusively the domain of playground fantasy are being spent of “shutting the door once the horse has bolted.”

Solution: a reliable and proven means of mapping, monitoring and managing system complexity with inbuilt “crisis anticipation”…Ontonix

In the following example we refer to monitoring an IT system within a banking environment. Often, due to a mish mash of legacy and bespoke systems, amongst the most complex and, therefore, vulnerable. At the other end of the spectrum lie systems associated with Call Centres (link).

Experience: Major Polish telecommunications providers turn to Ontonix – Polkomtel acquires licenses of OntoSpace and OntoDyn.Plus

Existing clients

image Swisscom is Switzerland’s leading telecoms provider, with 5.7m mobile customers and around 1.8m broadband connections

Real-time Monitoring of IT Systems (Bank)clip_image002 IT systems in banks are extremely complex dynamical systems, composed of disparate hardware platforms, disk, routers, software applications, and are accessible by the bank’s customers via the internet. Clearly, the correct operation of a bank’s IT infrastructure is of vital importance. Real-time monitoring of the complexity (and fragility) of a large IT system may be used to issue early warnings to the system’s managers, helping intervene before the systems reaches a state of crisis.

The following graphic is not specific to IT or telecoms. systems but highlights some of the consistent and verifiable results of our unique research into system complexity. Our technology is in use in a wide range of sectors including Banking, Mining, Medical research, Healthcare and Air traffic control to Computer aided design and petrochemical manufacturing.

Principle of Incompatibility

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