Lessons from 2009
by John Parkinson
"May you live in interesting times" is a pretty good translation of an old Chinese curse. The times have been pretty interesting lately - and interesting times can be instructive if you are paying attention and get to live through them. Here's my list of the top five "learnings" from 2009's tough survival course.
- When TCO really matters, look at your maintenance and support costs and weep with frustration. As hardware and (especially) software get proportionately cheaper to acquire, a larger and larger proportion of TCO gets allocated to support and maintenance. For hardware, this is finally getting addressed by manufacturing quality programs, predictive failure monitoring and remote diagnostics. For software, it's just getting more expensive (both relatively and absolutely). Look for this to be a pivotal issue in 2010 and 2011.
- Integration costs make everything more expensive. When I took a close look at this in 2009, I was surprised at how much of our routine engineering and operations capacity was required to keep all the technology we use updated and working together. This is a hidden productivity tax on everything we do and will also be a major focus in 2010. I don't know yet what we will do to fix the issue, but fewer moving parts has to be high on the list.
- It's easier to scale up than scale down. Although our marginal costs decrease as we grow, the exact reverse is true when we need to shrink capacity fast. Buying some on demand capacity as variable cost insurance needs to factor into our thinking when growth resumes. Nothing grows forever and we need to be smarter and better positioned ahead of the next inevitable downturn.
- Going "green" may make you feel good, but it's really all about energy efficiency. Access to an adequate and reliable electricity supply, plus the means to keep hot equipment cool (or at least thermally stable) has been something we have taken for granted. I think we should stop doing that. Whatever it is that's happening to the climate, demand for power and cooling isn't going to go away - and I'm worried that growth in demand will far exceed growth in capacity over the next decade. The time to start planning to be more efficient is right now.
- Don't throw essential people off the bus. Many organizations get smaller in tough times, but do they shrink efficiently? The criteria by which the "survivors" are selected aren't always as transparent and rational as we like to think and the organization can suffer as a result. Investing in people in the tough times always pays dividends later - even with today's differently motivated work force and eroding corporate cultures.
Happy holidays and best wishes for 2010.