Monday, April 13, 2009

cash is kind

"cash is king" is a principle that many companies today have to follow. this simple means all decision must follow to increase cash flow.

for all activities and departments of a company with no direct impact to the core business process this means that they are forced to immediate reduce their budget to a minimum / essential value.

HR, IT, TechDoc, .... are examples for affected units.

the current situation is not designed for mid or long term investments in the mentioned buisness areas which "only" improves long term operation. what you need is short term benefit without too much investment.

good opportunity for outsourcing, isn't it? i expect significant amount of companies try to reduce their supporting activities through outsourcing services even if the services doesn't fit 100% to their specific needs and the missing parts isn't essential for daily operation.

what do you need for service outsourcing:
  1. service function must be fully defined (in technical context this means that the interface must be fully defined)
  2. service availability must be defined
  3. service security must be defined
    =>what happens with the data maintained by a different organization?
  4. service termination must be defined
    =>what happens if service is moved in-house again or moved to different service provider?
  5. price must be defined
    =>pay per use / per time period / ?
having this in mind i expect increasing request to ASP / PaaS / SaaS / PRaaS buisness models and companies can provide such services in certain domains.

provide IT infrastructure (software & hardware) for daily operation for a dedicated amount of money.
=>IT assets based

provide a dedicated platform to implement and host a application for a dedicated amount of money.
=>development asset based

provide a dedicated set of software features for a dedicated amount of money.
=>software application / function based

provide a dedicated Process / Business function incl. the corresponding IT asserts for a dedicated amount of money.
=>business process based

the amount of semantic involved is increasing from top to down. therefore the potential value but also the potential risk for the requesting company increase. todays knowledge and IT infrastructure make usage of those business models not only possible for big, enterprise companies but also for mid and small size ones.

but beside few other points you still have to trust in trust if you want to go this direction.....

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