The 'New Efficiency'

In a recent speech given by Microsoft CEO Steve Ballmer to the CBI here in the UK, he referred to 'The New Efficiency'.  He was referring to the pressure in the IT market to enable customers to do more with less.

Whilst we may be coming out the other side of the recession, budgets will remain constrained as businesses strive to become more frugal in order to survive, yet the information technology requirements within their business continue to grow.

One way to do more with less is to outsource - to rent rather than buy.  When you buy something you are stuck with it until the end of its useful life.  Like a car for example.  I usually get bored of mine after about 12 months, but feel compelled to hang in to it for 3 years to extract value from the investment I have made.  But I spend the last 2 years constantly looking around at how car designs have improved, how they have become more efficient, powerful etc - and wishing I could just upgrade.  Sure, I could sell my car and buy a new one, but the money I would lose in depreciation alone forces me to hang on to it.

This analogy can of course be applied to IT infrastructure, where the pace of technological advancement is even greater than that in the automotive industry.  Those hard disks you bought last year - this year, for the same money you can have twice the storage and twice the speed!  Those tape libraries you invested in, which of course the finance guys wanted to write off over 5 years - 2 years later you know they are not the best way to back up your data, but you're stuck with them - no-one is going to buy them off you, so you're just gonna have to be behind the times for the next 3 years until you're allowed to buy something else.

So why buy tin?  There is a whole plethora of cloud based services which you can rent to do the same job, regardless of the application.  The problem of keeping at the cutting edge, refreshing technology and managing depreciation - this is no longer yours!  What freedom!  But what if your cloud provider doesn't keep pace?  Change it!  We live in a world where lock in is becoming less and less of an issue, both technically and contractually - as long as you factor this into your initial choice of provider, you should be able to enjoy this freedom to switch.

So what are you waiting for?