Monday, April 30, 2018

Plan Carefully in Moving to the Cloud

Various surveys show that a priority of many IT Directors is to move applications to the cloud. We also know that a great many companies have a large number of legacy applications, which means they will be faced with the issues around moving those old applications to the cloud - often referred to as lift and shift.

In some cases, this will mean that significant advantages of the cloud will be sacrificed, notably that of scalability. This could mean you pay more for less.

Selecting the right cloud vendor is one of the early and most important decisions. As is the selection of an IT migration specialist to help wth the transition. And then there's establishing suitable and effective channels of communication, especially if there is a high volume of data, as there usually is with business applications.

High volumes of data also raise the issue of storage cost, which can be a substantial part of the overall cost of cloud based applications.

Of course, moving applications to the cloud usually is a significant project, requiring extensive and careful planning and execution, not to mention maintaining security. These few comments are the very top of the tip. Suffice to say that established pre-conceptions about the benefits of cloud computing cannot be taken for granted.

For more detail on this topic, check out this link.

Friday, April 27, 2018

Priorities Among IT Professionals Not What You Might Expect

Solarwinds has released its 2018 survey of IT professionals. This time, they contacted 803 professionals from North America, the UK and various other points around the globe as to their views on IT priorities now and in the near future.

The conventional wisdom as to priorities focuses on artificial intelligence (AI), machine learning (ML), and blockchain. But there is a hype cycle at work here and with some of these, the cycle has not yet reached the stage of disillusionment. Nevertheless, C-Suites are trying to explore these technologies and how they might help them in their businesses.

IT Professionals, on the other hand are those charged with the job of inplementing technologies, and have a huge say in what ultimately goes live. The survey reveals that Cloud/hybrids are the top priority for this group. Second is the more general category of automation and third is big data analytics. Maybe these technologies are further along than others in the hype cycle. At the bottom of the heap are AI, ML and Blockchain.

What the survey indicates is a certain dissonance between what the C-Suite is looking at and the priorities of the IT Professionals. However, these two groups have a common goal - using technology to maximize productivity and efficiency. The survey may simply be indicating that some technologies are less advanced in terms of implementability than others.

Solarwinds recommends that organizations continue to focus on the development of cloud/hybrid technologies. In particular they emphasize implementation of Containers, which are technologies that improve the abilities of operating systems to share applications most efficiently.

As the report puts it, "investment and skills development perspective. IT professionals must remain grounded in the here and now, understanding that containers represent lower-hanging fruit in terms of investment, requirements, and barrier to consume. Specifically, containers enable application portability and promise consistent deployment, scalability, and development agility—all of which are key benefits in hybrid IT environments."

For the report, check out their site.

Friday, April 20, 2018

How Companies Become Digital Champions

PWC has published a study in which they interviewed 1,155 manufacturing executives in 26 countries to develop an index that ranks companies by digital operations maturity, from Digital Novices, Digital Followers, Digital Innovators to Digital Champions.

Out of that study, they developed a blueprint as to how companies can build themselves into digital champions, a distinction that only 10% of companies hold.

Digital champions are defined in the study as companies that have fully integrated digital technology into their systems end-to-end. They analyzed the data according to four ecosystems, which were Customer Solutions, Operations, Technology and People. It's important to note that these are not separate systems in the conventional sense but rather layers of systems within the company. Integration using digital technology is the key.

"Digital Champions distinguish themselves by advancing their capabilities through all four ecosystem layers, creating an organizational environment that takes the greatest advantage of the opportunities from digitization."

They found that companies in the Asia-Pacific area have the most leaders.

The report is available on the PWC website.

Monday, April 16, 2018

AI - Develop, Outsource or Buy?

A recent Gartner survey showed that 4% of companies have implemented Artificial Intelligence and 46% plan to do so. That shows two things - AI is in it's infancy and interest in it is strong.

How they actually implement is an open question. They can develop it on their own, but that's really expensive and requires a major effort. Or they can outsource it from providers like Amazon or Google. A third approach is to buy it from their software provider, which involves waiting until they offer it, and then determining if it fits their organization.

The latter approach is bound to be quite popular for the larger organizations and many medium ones that use SAP or Oracle, because a great many do use one or the other of these. Also, typically SAP or Oracle as the case may be will usually have invested in learning about the needs of the company and can help develop solutions that will be most likely to be a fit.

Most companies will not build their own AI apps. So either of the other approaches, the issue will be how to establish a competitive advantage.  Forrester Research's Brandon Purcell has the answer to that issue, "Data will be the key source of competitive differentiation in the world of AI -- emerging data sources, innovative data transformations, and business-infused data understanding will lead to better models and ultimately better results from AI.

Once again, data rules the day.

For more, check this article.

Wednesday, April 11, 2018

The Future of Corporate Reporting is Digital

The UK’s FRC Lab issued a deep dive report in December that urges regulators, companies, investors and technology providers to work together to realise fully the potential of XBRL and to respond to the challenge of a new European Single Electronic Format (ESEF) for digital corporate reporting due to come into effect in 2020.

XBRL has become the leading technology in the world for digital reporting. It is required by more than 100 regulators in 70 countries, including the SEC, which last year implemented requirements for foreign private issuers to file their reports in XBRL. That was a significant requirement for all FPIs around the world using the IFRS accounting standards. This includes over 300 companies in Canada, most of its largest companies.

In the EU, the ESEF requirement takes effect in 2020. That requirement calls for the use of XHTML combined with iXBRL to present reports. All EU Companies will be required to follow this approach. In the UK, iXBRL is already required by the tax authority and some 2300 companies must comply. Also, over 2000 companies file their reports in iXBRL with Companies house, the national companies registry.

The deep dive report was triggered by the forthcoming advent  of ESEF and a recognition that preparation is required to make it work properly.

The movements of the US, UK and others towards digital reporting point to the fact that a world where corporate reporting is based on paper is rapidly coming to a close. In an increasingly digital world, where companies are engaged in digital transformation at all levels, the expectation of a continuance of paper based reporting is absurd. Paper reports will survive for some time, but they will be secondary reports, expensive relics of the past.

The deep dive report fully supports the power of XBRL and contains several important suggestions, including:
  • for regulators to work together to align reporting requirements and thereby reduce reporting burden.
  • for executives and Boards to ensure that suitable governance is in place so that digital reports meet the needs of users. Companies need to have appropriate processes and procedures in place to manage disclosure in a digital age.
  • for users to familiarise themselves with Inline XBRl and structured financial statements, to ensure that they can maximise the benefit that digital disclosure of fundamental data can deliver.
  • for software vendors to work to educate the market and to continue to innovate in the delivery of high quality software that is easier, more intuitive and more accessible for the preparer community.
Here is a link to the (PDF!) report.

Monday, April 09, 2018

Need for A Stronger Role for Libraries in Digital Information Consumption

With all the fuss during the past year on the reliability and truth of information, especially that available through the digital media and the news media, has led to renewed interest on how people can be confident about the information they have available to them.

As part of the research on this topic, Pew Research Centre did a survey last year on the types of information available and the feelings and attitudes of people about that information. They explored factors such as the following. "How interested are they (consumers) in the subject? How much do they trust the sources of information that relate to the subject? How eager are they to learn something more? What other aspects of their lives might be competing for their attention and their ability to pursue information? How much access do they have to the information in the first place?"

An analysis off these factors led to a conclusion that two main elements contribute to the level of their enthusiasm about information - "their level of trust in information sources and their interest in learning, particularly about digital skills."

Other studies have shown that people must have some trust in the information in order to be able to use it intelligently. But what to trust in the digital world, particularly that of the internet, is a difficult challenge. Levels of sophistication about information reliability tend to vary with levels of education. Also, gaining access to the information requires a certain level of digital skill with the tools being used. This in turn requires some desire to learn those technologies. This desire to learn varies as well. Often the level of sophistication about the information and the desire for learning follow the same track in tandem.

While the Pew study concluded that there is not a "typical user" out there because of the spread of the variations across the population, there is an obvious possible role for a learning mechanism for those who are at all willing to take part in learning activities, which according to the results constitute a large proportion of the population. Pew points to the libraries as a possible resource in this effort.

AS the Study says, "Library users stand out in their information engagement. Overall, about half (52%) of adults have visited a public library or connected with it online in the past year. Those library users are overrepresented in the two most information-engaged groups. Some 63% of the Eager and Willing were library users in the past year, while this is true for 58% of the Confident. Additionally, both groups are much more likely than others to say they trust librarians and libraries as information sources."

Something to think about, especially for those who think that libraries are obsolete. Here's a link to the Pew Study.

Wednesday, April 04, 2018

What we Mean by Information Integrity

With the growing focus on data for purposes of decision making, whether it be big data or regular internal data, there is a growing need for a focus on information integrity. However, what exactly is meant by information integrity is not widely understood.

In 2013, the AICPA Assurance Services Executive Committee’s Trust Information Integrity Task
Force in conjunction with the Canadian Institute of Chartered Accountants published a paper on this topic. The paper provides a full explanation of the meaning of information integrity.

In that paper, "information integrity is defined as the representational faithfulness of the information to the underlying subject of that information and the fitness of the information for its intended use."

These two concepts - representational faithfulness and fitness for intended use - form the core of information integrity.

Representational faithfulness is determined by how well the information "represents the subject that it purports to represent. For example, a weather report is the representation of the weather. Therefore, the integrity of the weather report depends on how well it represents the weather."

The other concept - fitness for use, is clearly related to the concept of representational faithfulness since if the information does not fairly represent the subject, it will be of little use.  But fitness for use goes well beyond this idea. The paper points out that "information is prepared for a specified purpose and includes: (1) the observations about the characteristics of the specific events or instances to which it pertains, (2) information about the environment in which the events occurred or the instances existed and (3) other information necessary for the observations to be used for their intended purpose."

This additional information is often referred to as meta-information. "Information integrity is determined based on both the information’s consistency with its meta-information and its representational faithfulness. Therefore, information integrity includes the accuracy, relevance, precision, timeliness and completeness of the information and its meta-information. Information that is accurate, relevant, precise, timely and complete for a particular purpose can be termed to be “fit for purpose.”

That's quite a handful to deal with. It requires some dedicated effort by management to assess the integrity of the information it is using, but this effort is crucial to making sound decisions.

The paper has some ideas for how management can obtain the assurance they need, ranging from making sure they understand the context of the information to obtaining an independent report from an information assurance professional. It's an area that deserves a lot of attention. A copy of the ASEC report can be obtained on the AICPA site.

Tuesday, April 03, 2018

The Need for Trust in Data

The rise of usage of big data, often from outside the company, with the use of data analytics enhanced by Artificial Intelligence in making decisions has led to a confluence of issues around the question of whether the data can be trusted. Since automated decision making can often operate independently of people intervention, and in fact operates along with people, the issue becomes one of governance.

C-suites are beginning to consider this issue since they are in charge of overall governance. They are asking - how does the involvement of machines in decision making affect corporate governance?

In a recent study commissioned by KPMG International, Forrester Consulting surveyed "almost 2,200 global information technology (IT) and business decision makers involved in strategy for data initiatives.The survey found that just 35 percent of them have a high level of trust in their own organization’s analytics."

This is an important issue. Trust is essential in order for people to interact effectively with machine generated decisions. Lack of trust will inevitably lead to the development of informal workaround processes that will not serve the organization well in the long term.

What it means is that machines making decisions need to be managed along with people. So organizational responsibility for data and for analytics needs to be assigned. To establish trust, there needs to be some assurance about the quality and integrity of the data and the integrity of the analytics (models and algorithms) being used.

It's a major challenge. Check out the KPMG Report here.