On-Demand Update

Irving Wladawsky-Berger of IBM provides an update three years after its launch:

When we announced On Demand, we were convinced that one of the biggest changes coming to computing was in how customers acquired and paid for IT and IT-enabled business processes. This was the logical outgrowth of several widespread changes: an increasingly powerful and reliable IT infrastructure; the continuing acceptance of open standards all the way to the business process level; and the growing economic and competitive pressures faced by every business. In the previously referenced Information Week article Sam Palmisano said: “If businesses are going to become more flexible and variable, they’re going to need more flexible and variable ways to acquire and pay for information technology. A pay-as-you-go delivery model lets [customers] concentrate on their core business and tap into computing resources far beyond what they could reasonably own or manage.”

People initially seized on this concept of “pay-as-you-go” and equated it with On Demand. In the last three years, however, we have gotten past having to defend On Demand as being more than just “utility computing.” There is wide acceptance of On Demand as a state in which every company focuses on what it does best and partners for the rest, in order to remain flexible and to keep adapting to changing market conditions. This major trend has been very well captured in a recent paper from IBM’s Institute for Business Value which said, “In this environment, only specialization – a laser-like focus on the few activities that confer real advantage and profit – will enable firms to deliver full value to their key stakeholder groups of customers, employees and shareholders.”

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Rajesh Jain

An Entrepreneur based in Mumbai, India.