Digital transformation is not a new term, but it’s gaining currency among business leaders who want to use the Internet of Things and IT to change business models. The goal? Better cost-efficiency and return on investment, lower costs, and improved customer experience and business processes.
Among CEOs surveyed in April by Gartner, 42 percent have a digital transformation business strategy in place.
What are the key building blocks of successful digital transformation? Speaking last week at the CDW Executive Summit in Chicago, William Giard, CTO of the Data Center Group at Intel, laid out five key elements. According to Giard, they include hybrid cloud, virtualized networks, future-ready storage, an analytics and data strategy, and multilayered security.
“Some businesses will have to invest in one more than the other,” Giard said, noting that every business is different.
1. Hybrid Cloud Helps Balance Workloads
Businesses need to take a holistic approach to digital transformation, Giard said, but hybrid cloud — a mix of private and public cloud services — is a crucial element. According to Giard, 40 percent of enterprises are using hybrid cloud today, and 60 percent of enterprises are testing or planning a hybrid cloud implementation within the next 24 months.
Businesses no longer need to go entirely with one type of cloud, Giard said. “Both public and private cloud make sense,” he noted.
As business leaders decide which kind of cloud environment is right for them, they should consider the company’s needs, including agility and time to market, legal and regulatory compliance issues, and total cost of ownership.
Business and IT leaders must also consider the technical characteristics of their cloud environments, including performance, integration, how much data they are processing and the security needed for that data. Security, Giard notes, is the No. 1 reason why organizations go with on-premises cloud deployments.
Additionally, organizations need to consider how their cloud ecosystem will be configured. Do they have mature Software as a Service offerings? Will they be locked in with one cloud service provider, or can they rely on multiple vendors? And how much access to cloud expertise do they need?
If an organization decides to go with hybrid cloud, Giard said it should evaluate and optimize where it is putting its workloads. Organizations should also consider application innovation and optimization with internal Platform as a Service and Database as Service offerings. And, finally, they should make sure to dive into the details with any public cloud offering.
2. Virtualized Networks Handle Traffic Growth
According to Cisco Systems’ 2017 Visual Networking Index forecast, global IP traffic in 2016 stood at 96 exabytes per month and will nearly triple by 2021, to 278 exabytes per month. That traffic growth will make network virtualization even more important as businesses seek to be more agile in the face of mounting data traffic.
“Organizations are recognizing the critical role of network virtualization in IT transformation,” said Giard. He cited Bank Leumi, an Israeli bank that deployed a private cloud–based, software-defined infrastructure model powered by Intel. With the new setup, the bank was able to cut the time required to configure new services from three weeks down to three hours, and a new firewall policy that previously took eight hours to deploy took only 15 minutes.
As organizations implement virtualized networks, Giard advised that they should virtualize on a common platform to reduce the total cost of ownership, deploy network functions virtualization for better security and agility, and use tools such as Intel Network Builders solutions.
3. Future-Ready Storage Captures Data
The amount of data that organizations generate is burgeoning, Giard said. Business data is growing at a 30 percent rate each year, while IT storage investment is growing at only around 3 percent, according to IDC’s “Worldwide Semiannual IT Spending Guide.”
As organizations think through their data storage options, Giard said they need to inventory their current data across the storage environment, leverage the right kinds of media for optimized data tiering and deploy software-defined storage that can scale out.
Giard noted that a large grocery store chain saw significant benefits by deploying a software-defined storage solution. The company achieved a 92 percent performance gain, cut its capital expenditures by 80 percent and reduced its IT footprint by 90 percent.
4. Data Analytics Drives Insights
Analytics is the top investment priority of CIOs, according to the 2017 Gartner CIO survey.
“The goal is to reduce ‘time to insight’ and drive competitive differentiation,” Giard said, yet challenges exist. Data is scattered and often unusable, there is a shortage of skilled data experts, and analytics solutions can often make IT environments more complex.
But when businesses analyze their data effectively, the results can be powerful. For example, when Caesars Entertainment implemented a Hadoop environment with Cloudera Distribution Hadoop on Intel architecture, said Giard, it cut processing time from three hours to 45 minutes and expanded capacity to three million records per hour.
For companies that are rolling out analytics, Giard said, business outcomes should drive the strategy. Organizations need to future-proof their analytics infrastructure and democratize analytics to create a data culture.
5. Multilayered Security Protects IT
The projected cost of cybercrime to business will reach $2.1 trillion by 2019, according to Juniper Research.
“Effective security is built on multilayered trust and vigilance,” said Giard. He described this as “defense in depth,” which comprises securing the platform, protecting the data (at rest and in motion) and monitoring analytics.
Organizations face barriers to deploying such a strategy, said Giard, including performance issues related to encryption; a lack of solutions in the market that can analyze high volume and varied types of data; and high levels of human intervention required for threat detection, analysis and remediation.
To deploy effective multilayered security approaches, organizations need to build security into their platforms at the hardware level, use encryption whenever possible and take advantage of analytics.