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Hardware Load Balancing | Financing Your Vendor's Technical Debt

Josh Grose
Posted on May 3, 2017 10:11:30 AM

A CIO’s mantra for 2017: Relentlessly automate. Digitally transform. 

Put plainly, get the product out the door...fast. Then get feedback, iterate, and get a more compelling product out the door. Do that and you may win for a year or two, three max. Otherwise, some known or unknown competitor will do it. And you’ll be out of a job. 

Today, moats are built on the speed at which companies operate and innovate.

If we all agree on that premise, how does an enterprise achieve speed while being saddled with organizational, procedural, and technical debt?

One way to handicap your organization in this pursuit is by “investing” in the technical debt of your legacy vendors. This is, in essence, enterprise technology’s version of a negative yield bond, but so much worse. At least with a negative yield bond, you are guaranteed some value at maturation, even if it is less than your original investment. Such generous guarantees don’t exist with purchase orders to legacy vendors.

Before tackling the causes of your vendor’s technical debt, take stock of your own environment. Likely you have infrastructure sitting on various code levels, refresh cycles, and maintenance contracts. Middleware connects it all. Either homegrown or off-the-shelf monitoring tools provide operational awareness. Everything is running a variety of virtualization and OS versions. You have a heterogeneity of “clouds” running inside and outside your building. On these clouds, teams are starting to embrace containers while still nurturing monolithic applications. It’s impossible to keep track of, secure, and maintain such a complex ecosystem. That is why 70-80% of your IT budget is spent on maintenance.

The common goal among all these teams of operators, architects, and application owners is the desire to become modular...or abstracted...or disaggregated...or decoupled. The question they are asking themselves is, how do I remove all the dependencies so I can substitute at-will and, ultimately, have control over my own domain?

What would you say if I told you that legacy vendors running purpose-built appliances are in even worse shape? And how is that even possible?

It’s 80% financial and 20% organizational.

In addition to the environment challenges you may be facing, your vendors are also up against their shareholders. Appliances cost more than software. To convert to a software strategy, a company must be willing to tell shareholders that they plan to cannibalize their moneymaker and, ultimately, make less money than they did the year prior. Then they must continue to invest in the existing platform, while also committing 100% to a software version that requires many cycles to reach feature parity. And to market this new technology, they have to walk the fine line of anchoring against their existing product, while also re-training a hardware focused sales force. Sounds expensive and unlikely.

To build a new software version of an existing product, there are organizational challenges that make it difficult. An organization must retool or hire a different breed of talent to define the new architecture. This divestment from existing projects wreaks havoc on those working on legacy products and quickly becomes mainstream news. Because of these inescapable challenges, vendors try to speed up the process by taking shortcuts to market by releasing software editions that end up sharing many of the same “black box” limitations as their hardware counterparts. Despite the press release, the market soon recognizes these new products are not open, flexible, or cloud-ready. The result: software packages that fail or subsist on the same annual release cycles, inoperability with the rest of the stack, and wizard-based, appliance-like deployment models.

So that brings me to the question:

On a scale of 1 to 10, how confident are you that your current vendors will be able to help you in your quest to build your company’s next great moat?

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Topics: load balancer, Load Balancing, sales 101, vendor technical debt, enterprise selling

   
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