Showing posts with label Cost-savings. Show all posts
Showing posts with label Cost-savings. Show all posts

October 11, 2017

Amazon + Teva = A Marriage Made In Heaven


Amazon has upended so many industries--and you can basically buy almost anything there.

And yes, what you can't buy today, you will be able to buy tomorrow. 

What started as books and DVDs is now virtually synonymous with e-Commerce itself!
Next up for Amazon is pharmaceuticals!

Some people may think that Whole Foods gives Amazon the footprint it needs to sell these and dominate.

But what people aren't considering is that Amazon can sell the pharmaceuticals online.

Amazon can do what other online drug distributors can't.

Why?

Because Amazon has the most unbelievable distribution network in the world. 

Currently, people can order drugs through the mail, but these tend to be for regular reoccurring prescriptions that have lead time. 

However, Amazon can outdo these mail order pharma companies, because they can get you the drugs you need when and where you need it. 

- You don't feel well and can't make it to CVS, Amazon will deliver to your door. 

- Need same-day delivery, no problem. 

- Plus do all your shopping together in one fell timesaving swoop. 

My prediction: 
Amazon the low cost, efficient online seller of everything to everywhere is going to partner with Teva Pharmaceuticals, the #1 world leader in low cost generic drugs.

Teva already produces 120 billion tablets and capsules every year, operates in 80 countries, and currently fills 1 in 6 generic prescriptions in the U.S. 
Together, Amazon and Teva can make beautiful music, that is medicine + money!

Who needs CVS when pharmaceuticals perhaps soon can be gotten at Whole Foods or at your Trusty Amazon.com.  

One more time, I see some radical disruption--and this time it will bring you cheaper and more convenient drugs--make a l'chaim to your health. ;-)

(Source Graphic: Andy Blumenthal)

(Endnote: I am a big fan + investor in Teva, and of course, all opinions here are my own.)
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January 26, 2017

Camera Of Life

So this open-door market has no workers there.

Someone comes in to stock the shelves periodically, and that's it!

It's completely automated of workers, and only has this automated kiosk for check-out. 

As you shop, there are cameras watching you, so you don't steal anything. 

Then you go to the checkout and like in other stores, you scan you items and pay with your credit card, but the difference is that it's without anyone else around at all.

Can you imagine someone would leave there business and there is no one watching you, except the cameras.

You're on your honor system. 

Just think how much money the owner saves by not having to stand there or hire someone to stand there all day. 

He can have 10 or 100 or 1,000 of these stores and no daily labor to pay for. 

Talk about people losing their jobs to automation and robotics!

So even if someone does steal 1 or 2 things, it's a minor loss to the owner compared to paying someone to stand there and check people out all day (salary, benefits, payroll taxes, workers comp insurance, and more). 

What if the camera isn't even real and it's just a dark cone, so you are just left to think that you're being surveilled...another savings for the owner. 

Now imagine if we all internalized this thought in life that we were under the watchful eye of our Maker, and everyone would do the right thing even when no one else was there watching. ;-)

(Source Photo: Andy Blumenthal)

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February 7, 2016

Cloud Pleasing

Technology vendors have wised-up and are rushing to the cloud to give customers what they want. 

You want cloud?  

You got cloud!

Cloud Computing with the virtually infinite promise for flexible, cost-effective, on-demand computing--all centrally managed by the vendor--you can sleep easy at night, oh baby. 

CIOs love it. 

The only problem as everyone moves to the cloud is the promise of the cloud continues to fall short

Now how unpopular a thing to say is that? 

Take out the guillotine...

Seriously though, it was supposed to be flexible, but it isn't so much as vendors contract with customers for multi-year deals and customers find switching vendors not quite so easy...anyone hear of vendor lock-in?

Also, cloud was supposed to be more cost-effective, but vendors still need to make their margins, so longer commitments, service bundling, minimum fixed costs, and variable month-to-month pricing--sure helps things add BIG DOLLARS for the cloud vendor. 

Then you have vendors that simply call everything cloud...ah, "cloud washing" that is.  If you think you are getting cloud (even if it ain't so much so), yippee are you happy...you have drunk the cool-aid and it is sweet.

Technology leaders swooping into a new job want to come in with a bang..."Hey, look what I did to modernize, transform, reinvent, revolutionize...and save money too--thank G-d, they hired me."

So cloud, cloud, cloud...it sounds so CLOUD PLEASING, I mean crowd-pleasing. 

Whether in the specific situation it's better or not, that's not the point, stupid. 

At least, it's out of our hair--let the vendor worry about it!

One, two, three...everyone say "CLOUD!" ;-)

(Source Graphic: Andy Blumenthal)
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December 25, 2013

The Lie Of The Open Workspace

There are so many workplace liars—the problem is many of them are experienced and good at selling you a bunch of malarkey.

Often, they tell you what they want, either to save the company money or to make themselves look innovative, but either way it’s inevitably at your cost. 

One of these lies is from chieftains that tell you’ll be better off working in an open workspace--i.e. thrown into a corporate bullpen.

Oh, by the way, vacate your office by Friday!

Sure there are a plethora of benefits to having common spaces to share ideas and open up communications—and these should be plentiful and stocked with comfy sofas, energy-inducing munchables, and ample white boards and tech gear to facilitate collaboration.

But when the pendulum swings all the way to the other side, and your personal office space become a hoteling situation, you know you are losing out to penny-pinching executives, who want to save on leasing office space, furniture, and the like in order to boost their personal bonuses at the end of the year. 

Just ask yourself:

- Do people need privacy to handle sensitive personnel, budget, contracting, and strategic planning and execution issues (as well as occasional family or personal issues—we are all human)?

- Do you need time to close the door for some quiet time to think, innovate, and catch up on work?

- Is there a genuine human need to have a place to put your work and personal things to be productive and comfortable?

The truth is that people need and deserve a balanced work environment—one where people can move healthily between closed and open spaces, individual work and teamwork, privacy and sharing, creativity and productivity, individualism and conformity, comfort and cost-savings. 

Anyone that tells you that people work better in a fully open environment where you have to book up a desk and computer is selling you on short-term organizational cost-savings at the expense of longer-term human capital satisfaction and productivity.

Next time, a “leader” tries to convince you of the merits of your not having a professional workspace, desk, computer, and so on—ask yourself whether you want to work in a Motel 6 every day or for a stable organization that values and invests in it people. 

An appropriate blended environment of open and closed work spaces, where it shows that you are empowered and valued is a career, and not just a job;-)

(Source Photo: here with attribution to epochgraphics)
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November 10, 2013

Green Data Center Cooling

I read with great interest this week in BBC about 2 mysterious barges off the East and West coasts of the U.S.

One barge is by San Francisco and the other by Maine. 

The 4-story barges belong to Google. 

There is speculation about these being, maybe, floating data centers.  

I think that is more likely than showrooms for Google Glass.

These barges would potentially avail themselves of the ocean water for cooling the IT equipment. 

I would imagine that there could be some backup and recovery strategy here as well associated with their terrestrial data centers.

But how you protect these floating data behemoths is another story. 

A white paper by Emerson has data center energy consumption in the 25% range for cooling systems and another 12% for air movement, totaling 37%.

Other interesting new ideas for reducing energy consumption for data center cooling include submersion cooling. 

For example, Green Revolution (GR) Cooling is one of the pioneers in this area.

They turn the server rack on its back and the servers are inserted vertically into a dielectric (an electrical insulator--yes, I had to look that up) cooling mineral oil. 

In this video, the founder of GR identifies the potential cost-savings including eliminating chillers and raised floors as well as a overall 45% reduction in energy consumption, (although I am not clear how that jives with the 37% energy consumption of cooling to begin with).

Intuitively, one of the trickiest aspect to this would be the maintenance of the equipment, but there is a GR video that shows how to do this as well--and the instructions even states in good jest that the "gloves are optional."

One of my favorite aspects of submersion cooling aside from the environmental aspects and cost-savings is the very cool green tint in the server racks that looks so alien and futuristic. 

Turn down the lights and imagine you are on a ship traveling the universe, or maybe just on the Google ship not that far away. ;-)

(Source Photo: Green Revolution)
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October 12, 2012

Cloud $ Confusion

It seems like never before has a technology platform brought so much confusion as the Cloud.


No, I am not talking about the definition of cloud (which dogged many for quite some time), but the cost-savings or the elusiveness of them related to cloud computing.

On one hand, we have the Federal Cloud Computing Strategy, which estimated that 25% of the Federal IT Budget of $80 billion could move to the cloud and NextGov (Sept 2012) reported that the Federal CIO told a senate panel in May 2011 that with Cloud, the government would save a minimum of $5 billion annually.

Next we have bombastic estimates of cost savings from the likes of the MeriTalk Cloud Computing Exchange that estimates about $5.5 billion in savings so far annually (7% of the Federal IT budget) and that this could grow to $12 billion (or 15% of the IT budget) within 3 years, as quoted in an article in Forbes (April 2012) or as much as $16.6 billion annually as quoted in the NextGov article--more than triple the estimated savings that even OMB put out.

On the other hand, we have a raft of recent articles questioning the ability to get to these savings, federal managers and the private sector's belief in them, and even the ability to accurately calculate and report on them.

- Federal Computer Week (1 Feb 2012)--"Federal managers doubt cloud computing's cost-savings claims" and that "most respondents were also not sold on the promises of cloud computing as a long-term money saver."

  - Federal Times (8 October 2012)--"Is the cloud overhyped? predicted savings hard to verify" and a table included show projected cloud-saving goals of only about $16 million per year across 9 Federal agencies.

  - CIO Magazine (15 March 2012)--"Despite Predictions to the Contrary, Exchange Holds Off Gmail in D.C." cites how with a pilot of 300 users, they found Gmail didn't even pass the "as good or better" test.

- ComputerWorld (7 September 2012)--"GM to hire 10,000 IT pros as it 'insources' work" so majority of work is done by GM employees and enables the business.

Aside from the cost-savings and mission satisfaction with cloud services, there is still the issue of security, where according to the article in Forbes from this year, still "A majority of IT managers, 85%, say they are worried about the security implications of moving to their operations to the cloud," with most applications being moved being things like collaboration and conferencing tools, email, and administrative applications--this is not primarily the high value mission-driven systems of the organization.

Evidently, there continues to be a huge disconnect being the hype and the reality of cloud computing.


One thing is for sure--it's time to stop making up cost-saving numbers to score points inside one's agency or outside.

One way to promote more accurate reporting is to require documentation substantiating the cost-savings by showing the before and after costs, and oh yeah including the migration costs too and all the planning that goes into it. 

Another more drastic way is to take the claimed savings back to the Treasury and the taxpayer.

Only with accurate reporting and transparency can we make good business decisions about what the real cost-benefits are of moving to the cloud and therefore, what actually should be moved there. 

While there is an intuitiveness that we will reduce costs and achieve efficiencies by using shared services, leveraging service providers with core IT expertise, and by paying for only what we use, we still need to know the accurate numbers and risks to gauge the true net benefits of cloud. 

It's either know what you are actually getting or just go with what sounds good and try to pull out a cookie--how would you proceed? 

(Source Photo: Andy Blumenthal)

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April 17, 2012

Let's Come Clean About The Cloud

An article in Federal Times (16 April 2011) states that "Experts See Little Return For Agencies' Cloud Investments."

The question is were the savings really achievable to begin and how do you know whether we are getting to the target if we don't have an accurate baseline to being with. 

From an enterprise architecture perspective, we need to have a common criteria for where we are and where we are going.

The notion that cloud was going to save $5 billion a year as the former federal CIO stated seems to now be in doubt  as the article states that "last year agencies reported their projected saving would be far less..."

Again in yet another article in the same issue of Federal Times, it states that the Army's "original estimate of $100 million per year [savings in moving email to the DISA private cloud] was [also] 'overstated.'"

If we don't know where we are really trying to go, then as they say any road will get us there. 

So are we moving to cloud computing today only to be moving back tomorrow because of potentially soft assumptions and the desire to believe so badly. 

For example, what are our assumptions in determining our current in-house costs for email--are these costs distinctly broken out from other enterprise IT costs to begin? Is it too easy to claim savings when we are coming up with your own cost figures for the as-is?

If we do not mandate that proclaimed cost-savings are to be returned to the Treasury, how can we  ensure that we are not just caught up in the prevailing groupthink and rush to action. 

This situation is reminiscent of the pendulum swinging between outsourcing and in-sourcing and the savings that each is claimed to yield depending on the policy at the time. 

I think it is great that there is momentum for improved technology and cost-savings. However, if we don't match that enthusiasm with the transparency and accuracy in reporting numbers, then we have exactly what happens with what the papers are reporting now and we undermine our own credibility.  

While cloud computing or other such initiatives may indeed be the way go, we've got to keep sight of the process by which we make decisions and not get caught up in hype or speculation. 

(Source Photo: here with attribution to Opensourceway)

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January 29, 2012

Platforms - Open or Closed

Ever since the battles of Windows versus Linux, there have been two strong competing philosophies on systems architecture.

Many have touted the benefits of open architecture--where system specifications are open to the public to view and to update.  

Open sourced systems provide for the power of crowdsourcing to innovate, add-on, and make the systems better as well as provides less vendor lock-in and lower costs.  

Open Source -----> Innovation, Choice, and Cost-Savings

While Microsoft--with it's Windows and Office products--was long the poster child for closed or proprietary systems and has a history of success with these, they have also come to be viewed, as TechRepublic (July 2011) points out as having an "evil, monopolistic nature."

However, with Apple's rise to the position of the World's most valuable company, closed solutions have made a strong philosophical comeback.

Apple has a closed architecture, where they develop and strictly control the entire ecosystem of their products. 

Closed systems provides for a planned, predictable, and quality-controlled architecture, where the the whole ecosystem--hardware, software and customer experience can be taken into account and controlled in a structured way.  

Closed Systems -----> Planning, Integration, and Quality Control

However, even though has a closed solutions architecture for it's products, Apple does open up development of the Apps to other developers (for use on the iPhone and iPad). This enables Apple to partner with others and win mind share, but still they can retain control of what ends-up getting approved for sale at the App Store. 
I think what Apple has done particularly well then is to balance the use of open and closed systems--by controlling their products and making them great, but also opening up to others to build Apps--now numbering over 500,000--that can leverage their high-performance products.

Additionally, the variety and number of free and 99 cent apps for example, show that even closed systems, by opening up parts of their vertical model to partners, can achieve cost-savings to their customers. 

In short, Apple has found that "sweet spot"--of a hybrid closed-open architecture--where they can design and build quality and highly desirable products, but at the same time, be partners with the larger development community. 

Apple builds a solid and magnificent foundation with their "iProducts," but then they let customers customize them with everything from the "skins" or cases on the outside to the Apps that run on them on the inside. 

Closed-Open Systems -----> Planned, Integrated, and Quality PLUS Innovation, Choice, and Cost-Savings

Closed-Open Systems represent a powerful third model for companies to choose from in developing products, and which benefits include those from both open and closed systems.

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December 24, 2011

Wheelchairs Get A Boost

I am very excited by this new assistive technology for personal mobility coming out of Japan that can be used to help the aged or handicapped.

Rather than have to buy a separate electric scooter for longer distances that is heavy and can be challenging for people with certain disabilities to use, the WHILL is a simple add-on that can be attached to and removed from a regular wheelchair and can be steered, like a Segway, simply by leaning in the direction you want to go.

The WHILL is high-tech looking--like a futurist headphone that you place over the wheels of the chair and according to Gizmodo, it turns the wheels with a rechargeable lithium-ion battery that powers the chair up to 12 mph for 19 miles and then recharges in under 2 hours.

While pricing information is not yet available, my assumption is that this add-on will be significantly cheaper than a full-out electronic scooter.

One concern that I have about the WHILL is how someone who is wheelchair-bound will be able to attach/remove the drive-train device without the help of an aide or nurse. Perhaps an even more futuristic version will have the U-shaped WHILL built with push-button retractable arms, so that the attachment can simply "open up" rather than have to be removed.

Another question that I have is what safety features will be built in for example for automatic cut-off should someone using it get ill and keel over unto the device causing it to drive/spin out of control. I am thinking a weight-sensor on the WHILL that detects if too much of a person's body weight is leaning on it and then cause a safety shutdown.

Overall, I am encouraged by what WHILL will soon be bringing to help people in need to get around more easily in the future.


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July 24, 2011

How Do You Like Those Apples?

Apple

A new proposed method for determining Cost of Living Adjustments (COLA) for people receiving Social Security and federal and military retiree pensions is called the Chained Consumer Price Index (CPI).

The Federal Times (18 July 2011) reports that "proposed COLA changes would mean smaller annuities for retirees."

Essentially, the Chained CPI doesn't just look at the change in prices for "market basket" of goods, but it "takes into account...the fact that most consumers change their buying habits when prices go up."

What this means in a simple example (exaggerated for effect) is that:

If the price of an Apple goes up from $1 to $2 instead of COLA being adjusted so that retirees get $2 for the apple, we give them instead maybe $1.25, since we ASSUME that because the price of apples went up "people are likely to buy fewer apples or switch to a cheaper fruit."

Does that sound right from your shopping experience?

Are you going to buy fewer apples or are they sort of a necessity? Further, if the price of apples goes up, is it not likely that the price of other common fruits will go up in an inflationary environment as well.

This proposal which is estimated "to save $300 billion in its first decade" sounds like quite the fuzzy economics indeed.

So how do you like those apples?

(Source Picture: here)

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September 7, 2010

Enterprise Architecture Panel - Snowmaggedon and the End of the (Desktop) World: The Mobile Workforce


[Pictured (Left to Right): Andy Blumenthal, Chief Technology Officer, Bureau of Alcohol, Tobacco, Firearms and Explosives; Ms. Doreen Cox, Chief Enterprise Architect, U.S. Customs and Border Protection; Mr. Rod Turk, Chief Information Security Officer, U.S. Patent and Trademark Office.]

Introduction:

Good afternoon. I'm Andy Blumenthal, the Chief Technology Officer at the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). It's a great honor for me to be here with you today to talk about telework and how EA is shaping it's adoption.

Just coming out of the blazing hot summer, the blizzard this past February seems like ages ago. Yet this storm brought the federal workforce in D.C. to a halt for 6 days, costing more than $100 million in lost productivity per day. This was offset only by the 1/3 of the federal workforce which was teleworking.

Just in case you don't remember take a look at this:

I still remember Snowmaggedon because that was when we shoveled out the wrong car because the snow was so high we couldn't see which was ours.


More seriously though, telework benefits federal agencies in many ways:

1. Increases productivity
2. Enhances work-life balance and morale
3. Helps the environment by keeping cars off the road
4. Can save the taxpayer money by reducing the agency's footprint


Data from the Telework Research Network indicate that telework could save agencies and participants as much as $11 billion annually (on such things as real estate, electricity, absenteeism, and employee turnover) and that if eligible employees telecommuted just one day every other week, agencies would increase productivity by more than $2.3 billion per year (driven by employee wellness, quality of life, and morale).

According to OPM telework adoption is growing. As of 2008, telework increased 9% over the previous year and now slightly more than 5% of the federal workforce are teleworking.

Telework got a boost when the House and the Senate passed similar bills--in May and July respectively--to expand telework opportunities. The two chambers now must reconcile their versions before a final bill heads to President Obama for approval. The Telework Enhancement Act would make employees presumptively eligible and require that agencies establish telework policies, designate a telework managing officer, and incorporate telework into agency's continuity of operations plans.

Five years ago nobody would've thought that EA would inform the discussion on telework. EA was still primarily a compliance only mechanism and didn't have a real seat at the decision table. Now thanks to the efforts of all of you, it's strategic benefit is recognized, and
EA is playing a vital role in planning and governing strategic IT decisions such as in investing and implementing telework solutions for our agencies.


Our distinguished panelists here today will discuss how EA is informing the discussion of telework from both the policy, systems, and security perspectives.

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May 22, 2010

Staying Open to Open Source

I don’t know about you, but I have always been a pretty big believer that you get what you pay for.

That is until everything Internet came along and upended the payment model with so many freebies including news and information, email and productivity tools, social networking, videos, games, and so much more.

So when it comes to something like open source (“free”) software, is this something to really take seriously for enterprise use?

According to a cover story in ComputerWorld, 10 May 2010, called “Hidden Snags In Open Source” 61% say “open source has become more acceptable in enterprises over the past few years.” And 80% cited cost-savings as the driving factor or “No. 1 benefit of open-source software.”

However, many companies do not want to take the risk of relying on community support and so “opt to purchase a license for the software rather than using the free-of-charge community version…to get access to the vendor’s support team or to extra features and extensions to the core software, such as management tools.”

To some degree then, the license costs negates open source from being a complete freebie to the enterprise (even if it is cheaper than buying commercial software).

The other major benefit called out from open source is its flexibility—you’ve got the source code and can modify as you like—you can “take a standard install and rip out the guts and do all kinds of weird stuff and make it fit the environment.”

The article notes a word of caution on using open source from Gartner analyst Mark Driver: “The key to minimizing the potential downside and minimizing the upside is governance. Without that you’re shooting in the dark.”

I think that really hits the target on this issue, because to take open source code and make that work in a organization, you have got to have mature processes (such as governance and system development life cycle, SDLC) in place for working with that code, modifying it, and ensuring that it meets the enterprise requirements, integrates well, tests out, complies with security, privacy and other policies, and can be adequately supported over its useful life.

If you can’t do all that, then the open source software savings ultimately won’t pan out and you really will have gotten what you paid for.

In short, open source is fine, but make sure you’ve got good governance and strong SDLC processes; otherwise you may find that the cowboys have taken over the Wild West.


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August 24, 2008

FDCC and Enterprise Architecture

Setting standards help us to reduce complexity, contain costs, build interoperability, and secure the enterprise.

The Air Force is leading the way in setting standard configurations for the Federal government for computers, servers, printers, and cell phones.

Government Computer News, 4 August 2008, reports that “The Air Force started taking delivery in July on the first of 150,000 new PCs…the first to come equipped with their Windows Vista operating systems, including Internet Explorer 7, preset to meet Federal Desktop Core Configuration (FDCC) 2.1 standards.”

The FDCC is an outgrowth of the Air Force’s IT Commodity Council (ITCC) “efforts with Microsoft in 2006 to test and develop a standard software configuration.” This was coordinated with NIST, NSA, and DISA, and other agencies. Further, OMB “required agencies to implement FDCC’s Windows XP and Vista standards by Feb, 1, 2008.”

Now ITCC is working with DISA, NSA, Army, Navy, Marine, and Coast Guard to build Server configurations. Microsoft is taking these base configurations and “will develop configurations for ‘roles placed on top,’ says Michael Harper, Microsoft Service Director.

“Those will include the file and print servers, the domain controller, Exchange, SQL server, SharePoint, Web, and Windows deployment services.”

FDCC is “forcing the software industry to pay greater attention to the default settings of its products”. This is helping to reduce security vulnerabilities, and reducing costs.

Some examples of reducing costs and achieving other benefits from FDCC include:

  • “Preinstalling software at the factory rather than retrofitting a machine.”
  • Reducing energy costs by “preconfiguring Vista’s energy management settings.”
  • Steamlining the number of…device categories.”
  • “Standardizing…software…makes it easier to manage network and document security.”

FDCC has been so successful that ITCC is now moving forward with doing the same standardization for mobile devices.

FDCC is a step forward in terms of inter-agency collaboration, working with the vendor community, and creating an enterprise architecture that hits the mark for improved IT planning and governance.


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