At ITWeb`s recent e-government conference, Mike Brierly, CEO of MTN Network Solutions, defined Internet access as "just another utility".
"Municipalities are in the business of providing utilities and the metros will argue today that they need to be allowed to deliver Internet access in the same way they deliver lights, water and refuse removal," he says.
Whether there will one day be an indecipherable Internet portion on our bills from City Power remains to be seen, but there`s no doubt the service delivery model is becoming more popular in many portions of ICT.
Want your Active Directory managed across the world? Talk to a managed service provider. Need your incoming network logs analysed by real humans? Talk to a network security service provider. Do you like the idea of outsourcing, but want it to be provided as a service? Talk to - you get the idea.
In the IBM white paper: Preparing for utility computing: The role of IT architecture and relationship management, authors JW Ross and G Westerman discuss the risks of various approaches to outsourcing. They conclude that so-called "utility computing", when combined with the already significant momentum around outsourcing, will lead to significantly more outsourcing, but that the success rates depend on the maturity of the customers` infrastructure. "The technologies make it possible for large numbers of services to be purchased rather than performed internally," say Ross and Westerman.
"Thus, firms will be able to do more with less. Outsourcing in a utility environment will enable firms to devote less attention to mundane commodity-oriented IT tasks and industry standard business processes. Instead, firms will be able to allocate their most strategic resources to their most strategic opportunities."
Out of the backlash
Managed services have been around as long as the post office and electricity utilities, but they`re a relatively new phenomenon in IT. Managed services were born out of the environment at the turn of the century, which saw IT become a commodity that relied too much on the skills of individuals.
This is an opportunity for South African service providers.
Derek Wilcocks, service director for Africa and the Middle East, Dimension Data
According to Derek Wilcocks, service director for Africa and the Middle East at Dimension Data, there was a relatively poor understanding of processes and it was hard to blend the in-source and outsource model. "Both companies that opted to outsource everything and companies that kept everything in-house faced challenges," he says.
"Organisations that wanted to do it all themselves found it hard to retain skills in a growing market, whereas outsourcing arrangements were often hampered by the difference in incentives between the outsourcer and the client."
As Ross and Westerman`s white paper makes clear, a popular approach to this modern form of outsourcing is to selectively manage a network of service providers.
"We have seen a strong move towards multi-sourcing," says Wilcocks. "Clients are now somewhere between the two extremes, rebuilding their internal capability around things like strategy, governance, enterprise architecture and commercial management of services. These are helped by the fact that even internal IT departments are positioning themselves as providers of services with SLAs and contracts. As soon as you multi-source, you can shop around from the best global service providers. This is an opportunity for South African service providers to develop good capability in particular areas and offer them globally."
South Africa has excellent technical skills, which are perhaps not as cheap as certain countries, but offer a good Western service ethic and the ability to relate to English-speaking countries.
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