Organisations are increasingly looking to hosted applications and outsourcing to provide solutions as they decide that IT provision is not part of their core competencies. Although the concept isn?t new, it has been developed and enhanced by the need for improved electronic communication and teamwork across widely dispersed sites. Linda Davies discovers that the approach is proving a winner for three organisations prepared to break the mould.
Implementing and maintaining any in-house IT system can be expensive and problematic. Even after the initial investment has been made, the appropriate resources to meet the changing demands of the business ? and cope with the speed at which technology is advancing ? may be inadequate. Organisations increasingly need to concentrate on core competencies, not IT provision. As a result, they are considering outsourced solutions for some, or all, of their IT and network activities, including application delivery. This, together with the prevalence of global connectivity offered through the Internet, is leading to the emergence of a new demand for externally hosted and delivered applications. These specialist software solutions are provided by a network service provider which can offer more robust, timely and complete services than can be supported or delivered internally. Notably, using a service provider achieves a significant time-to-market advantage, together with a greater capacity to maintain and support these technologies to match user requirements.
The concept of hosted applications is not new (remember bureau services?), but it?s one which has been developed and enhanced by the need for improved electronic communication and collaborative working, especially within a geographically dispersed environment.
Lotus is leading the field in the creation and delivery of hosted applications, by providing the tools that allow its business partners and service providers to develop and deliver specialist applications. Examples include vertical applications for the pharmaceutical, educational, legal and sales arenas, as well as workflow environments in which such technology has not traditionally been used, such as the construction industry.
The advantages of using hosted applications are that the speed of deployment is very rapid, they are available and supported by specialists 24 hours a day, and the latest technology will always be in use ? without any of the problems associated with roll-out and deployment.
Application usage is flexible and can be turned on or off at will ? Lotus?s applications are designed to be chargeable almost by the day and by the user. The main advantage of hosted applications is that companies can concentrate on their real business without having the worry of dealing with technology issues or employing a range of experts to support, manage and deliver them.
Because the application sits on the service provider?s server, there are a number of ways in which this can be accessed ? all of which rely on internetworked capability. The obvious technology being exploited is the Internet, using browser and Web standards to reach the host server.
More sophisticated systems may be part of a virtual private network, where the private circuit is provided by the telco and the hosted server forms part of it. Ross McConachie, marketing manager of groupware and applications at BT, says: ?Connection to the BT hosted services can be by any communication method, such as PSDN or ISDN. Because the communication link can still be quite a tricky part of the system, we would go in and set it up for clients as part of our service.?
The benefit of using standard technologies means that there is no specialist installation needed at the desktop ? additional users are simply plugged into the network. More commonly, service providers are offering a completely managed solution from the desktop, through the LAN and back to the host server. BT is launching a range of totally managed services, from desktop to hosted application, aimed at specific vertical markets, including manufacturing and finance industries.
The difficulty of building a wide area network takes managers away from productivity issues, and they can spend months or even years building and managing networks and applications which are out of date before they are implemented. Using specialist external providers, and standard communication technology, either through Internet or dial-up, removes a large part of this scaleability problem. The service provider is at the cutting edge, reducing the technology risk and offering a transparent solution, freeing IT managers from the hassle of building and re-building the corporate network as their global infrastructure changes.
In addition to specialist vertical applications, general purpose business tools ? word processors, spreadsheets and databases ? are being developed, mainly in Java, as hosted applications designed for access across the Internet. Both Oracle?s Interoffice Hat Trick suite and Corel?s Java Suite are examples of standard business tools that are being designed for use in this way, although these products are still immature.
Small and medium organisations as well as large organisations are taking advantage of this technology because they don?t need an IT department to run them and they greatly reduce the cost of ownership. Service providers are gaining a set of vertical, value-added applications to offer to their customers, who will soon have easy access to thousands of applications in a timely and affordable manner. Many of these applications will then be available to rent, with payment made for usage time.
The focus is now on end-user tasks rather than the technology which is needed to achieve them, while still retaining the high degree of functionality expected, including mobility, integration and security.
CASE STUDY 1: WS Atkins
Consultancy, management and technical services
BT Construct and Lotus Notes
To improve work control procedures on a new hospital development
Building a new hospital is a major undertaking, demanding co-ordination and teamwork from architects, project design teams, contractors, sub-contractors, lawyers and many others, who are usually spread geographically. Put these pressures together with the requirement for economy and a history of litigation and you find an industry ready to embrace new working practices, including the use of IT.
BT Construct is a new application offering a correspondence and change management system, a drawings and controlled documentation database, together with email and workflow software all based on Lotus Notes.
The aim of the system is to improve communication between all parties and to provide full document and work control procedures for every stage of a construction project.
WS Atkins piloted BT Construct on a recent major building project at Cambridge University and the company has subsequently chosen it to control documentation in a new hospital development in the Midlands which is being built under the Government?s Private Finance Initiative.
Divisional director Craig Wood explains: ?We were looking to develop a close working relationship between our contractors with less option for confrontation and more emphasis on teamwork, so that we could all get on with the job. For this we needed to adopt an electronic system that would allow us to collaborate and work successfully as a virtual team.?
The decision to use an IT solution was unusual for an industry which, by its nature, is contractually bound and has traditionally had a safe and sure approach to adopting IT.
?The decision had to be sold not only to the Board but also to our contracting partners who were tendering with us for the project,? continues Wood.
?The main task was to persuade them that no additional costs would be incurred by using technology to communicate between the parties, and that the system would indeed bring the anticipated benefits of time savings, instant access, consistency of information, decrease in volume of paper and reduced administrative costs.?
Both projects are complex, requiring a high degree of co-ordination, with very tight costing. ?Every project is a prototype with short lead times,? says Wood. ?But the only problem with shorter lead times is that any failure would have a significant impact on the viability of the whole project, so we need to get it right first time and have the minimum of re-work. It has to be a quality product ? in both finish and detail.?
Wood thinks the main advantage of using BT Construct was in the distribution of the drawings. ?This really did save both time and money,? he says. ?The greatest benefit to us was the time saving. Almost 30 per cent of a design engineer?s time is spent looking for information, so this was a significant aid. We knew that the system was working because people preferred to use it, and they were using it effectively.?
One of the most difficult tasks in evaluating the success of the product was deciding the performance metrics for evaluation and creating an understanding of what was going to come out of using the application, so that the degree of success could be measured.
?Construction projects are managed by deliverables, and this is what the system gave us ? the answers,? explains Woods. ?No longer did we have to resort to physically checking drawings to see that they had been completed and properly authorised ? it was all available within the system and from anywhere.?
The experience of the Cambridge University project has led WS Atkins to adopt BT Construct for other projects. ?The initial trial was a success,? says Wood, ?and the system has proved itself in the field. Plus, it coexists well with our existing paper methods and has shown us considerable savings, especially in time and the approval processes, so we are prepared to make a long-term investment in the system.?
CASE STUDY 2: The Salvation Army
To improve communication between its offices worldwide
The Salvation Army is an international movement, operating in more than 100 countries where its members provide a wide range of social, medical and other community services to millions of people, particularly in times of crisis. Its members need to be able to communicate efficiently and effectively, especially in war zones and remote areas of the world. The solution was to extend the Lotus Notes system used in its London office to all other parts of the world, replacing the traditional paper methods of fax, mail or costly courier services for the distribution of information to the global territories.
The Salvation Army embarked on a trial last year to connect the New York and Bangladesh offices with its London headquarters. Following the success of this venture, it has outsourced the hosting, management and deployment of its Notes applications using a hosted service supplied by Interliant.
?The Salvation Army needed to roll out Lotus Notes globally, offering each of our territories an equal service level regardless of location, time zone or communications facilities,? says Mark Calleran, the organisation's? IT manager.
?With Lotus Notes, we?ve improved the flow of information to keep the entire organisation briefed with up-to-date policies and guidelines. Using our outsourced Notes provider means we have more connections in more countries and removes the burden of support from us. We can communicate with countries such as Zaire, where before it was impossible even to send a fax.?
From a secure data centre in Houston, in the US, the hardware, software and administrative expertise is provided to host the Salvation Army?s Notes applications ? monitoring and managing the servers around the clock. Working with a variety of telecoms carriers, a range of economical connectivity options through local numbers is available for Salvation Army workers in the field.
The Salvation Army is replacing expensive, time-consuming couriers, faxes and phone calls with Notes messaging and databases that are replicated and distributed on the organisation?s behalf. Calleran says: ?We have improved communications, reduced costs and had a rapid deployment globally, while avoiding the personnel, time and capital costs of building a dedicated network.?
He adds: ?Information transmitted electronically now arrives in minutes not weeks, and is not affected by gunfire. We are now able to implement our relief initiatives more rapidly than ever. By outsourcing our applications and network management we have streamlined our administrative overhead without sacrificing communications or flexibility. As a result we have more resources to focus on our worldwide relief efforts.?
CASE STUDY 3: British Airways & Cathay Pacific
Aeronet which provides access to Boeing On-line data
To improve efficiency and minimise costs of aircraft maintenance
Airlines around the world are saving up to #350,000 per aircraft each year through the use of Boeing On-Line data (Bold) ? an application hosted by Sita?s Aeronet.
Bold provides access to all Boeing?s engineering drawings, component maintenance manuals and service bulletins for major and minor structural repairs, heavy maintenance, modification design, and parts information and enquiries. It has been designed to meet the needs of the air transport industry, with high-level security, global availability and local support.
?British Airways has used Sita?s Aeronet for the past two years to access Boeing?s Bold service,? says Tim LeBlond, manager for telecoms development at British Airways. ?This is because Sita offers a higher level of service than other methods can provide. This is particularly important to BA operations as we have increasingly come to rely on such systems for mission-critical applications.?
The efficient maintenance of a Boeing 737 involves a great deal more than just on-site engineering work. As a vital back-up, engineers require a maintenance library consisting of more than 140,000 cards, including 30,000 annual updates, and different drawings which are specific to the tail number of each aircraft. Airlines usually operate a mixed fleet of models, each with an increasing number of cards ? for example, a 747 has more than 400,000 cards and has multiple maintenance locations so these libraries have to be duplicated worldwide.
Chris Gibbs, managing engineer at Cathay Pacific, is in no doubt about Bold?s contribution. ?Aeronet has greatly increased efficiency in our engineering department by eliminating the need to produce, distribute and update hundreds of thousands of drawings held on microfilm,? he says.
?We probably access Bold about 1,000 times a day, and the cost savings that we are making are very important. But more than this, our engineering teams have actually achieved time savings and efficiencies that we could never have gained if we had still been using paper and microfilm.?.
According to the Air Transport Association, making this kind of technical information available to a mechanic at an aircraft work site not only saves significantly on the maintenance costs of each aircraft, but boosts aircraft reliability. This is because it largely eliminates information-related delays and improves troubleshooting, which can be worth up to #2.5m per year per fleet.
George Ligler, an independent computer systems and telecoms consultant, claims: ?The total annual benefits to a major airline are projected to be in the order of #420m ? presuming that there is an efficient implementation of document distribution.?
1 Keep it simple; the point of application hosting is to free you from making major IT investments yourself. It also provides a simpler alternative to outsourcing ? you don?t have to enter into long-term contractual commitments.
2 Until you are 100 per cent happy with a partner, keep your contracts short.
3 One of the main advantages of application hosting is that it gives you the opportunity to try before you buy.
4 If you find you?re still spending significant amounts of money on staff and support at your end, it?s possible that application hosting is not the best solution. Perhaps you should consider a longer-term outsourcing solution ? or even bring the job in-house
R BT: 0121 230 2054
R Interliant: www.interliant.com
R Sita: www.sita.int
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