Industry Shift: From IT Services to Services Aggregator The boundaries between cloud and non-cloud are not rigid. As enterprises embrace new ways of working in which the divisions between private and professional lives begin to dissolve, they need service partners with a new perspective for a new age. In Brief Every now and again the continual day-to-day changes we are used to in business and technology are overshadowed by a bigger shift. The big shifts are never the result of single social, economic or technology events – it’s only when these different influences align that the way we do things tomorrow really becomes different from the way we do them today. We are experiencing such a shift right now – and the cloud is at its heart. But in addition to the emerging commercial and technological viability of cloud service delivery we also see the impact of globalization and the transformative effect that digital technology has had on lifestyle – both in terms of social interaction and in terms of our expectations of every product and service provider. Delivery “as a service” is central to this shift: the cloud is transformational and changes the rules both of ownership and expectation. In this paper, we are going to look at how this shift impacts roles and responsibilities inside the enterprise – particularly for the CIO and CFO teams. We will also ask how the traditional role of the IT service partner is transformed, and show how KPN has anticipated and prepared for that change.

1. Industry Shift:
From IT Services to
Services Aggregator

2. Table of content
In Brief 3
Who is this paper for? 3
New Ways of Working 4
Change and Opportunity 5
Building on strength 6
Collaborative Shift 7
From IT Service Company to Cloud Services aggregator 7
Services Aggregator Snapshot 8
Service Profiling 9
Why aggregate? 9
Network differentiation 10
Benefits and Recommendations 10
About the author 11
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3. Industry Shift:
From IT Services to
Services Aggregator
The boundaries between cloud and non-cloud are not rigid. As enterprises
embrace new ways of working in which the divisions between private and
professional lives begin to dissolve, they need service partners with a new
perspective for a new age.
In Brief The KPN Corporate Market team is redefining itself, shifting
Every now and again the continual day-to-day changes we are its focus from IT services to business service aggregation.
used to in business and technology are overshadowed by a In this new role, we are ready to engage in all critical business
bigger shift. The big shifts are never the result of single social, discussions relating to cloud and delivery “as-a-service”.
economic or technology events – it’s only when these different
influences align that the way we do things tomorrow really Who is this paper for?
becomes different from the way we do them today. We hope this paper will be especially useful to members of the
CIO and CFO teams. This is not a document to be read in private.
We are experiencing such a shift right now – and the cloud is These roles will demand increasing collaboration in the new
at its heart. But in addition to the emerging commercial and cloud landscape and in some cases may even see these two
technological viability of cloud service delivery we also see the enterprise functions fusing into one.
impact of globalization and the transformative effect that
digital technology has had on lifestyle – both in terms of social In our role as Services Aggregator, we would welcome the
interaction and in terms of our expectations of every product opportunity to discuss the themes and issues raised in this
and service provider. paper with you.
Delivery “as a service” is central to this shift: the cloud is We are particularly keen to share ideas and opinions on:
transformational and changes the rules both of ownership • The growing complexity of vendor and contract management
and expectation. • he challenges of running cloud and non-cloud operations
T
concurrently
In this paper, we are going to look at how this shift impacts • The need to set performance metrics in the cloud
roles and responsibilities inside the enterprise – particularly for • he impact of cloud delivery on security, regulation and
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the CIO and CFO teams. We will also ask how the traditional compliance
role of the IT service partner is transformed, and show how
KPN has anticipated and prepared for that change. If you would like to talk about what the shift means for you,
please contact me directly.
Maurice Remmé
maurice.remme@kpn.com
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4. New Ways of Working
Even though the emergence of cloud invites us to examine how For this to happen, every enterprise must understand how the
an enterprise manages and sources IT and business services, services it delivers to the workforce will, above all, empower
it is worth starting from a different perspective: look at how them to excel. Everything else is secondary. Sure, you need to
people work – and ask how best to equip the workforce in a drive the costs out of operation; you need to increase process
world of changing practices, attitudes and regulatory obligation. efficiency; you need to minimize risk and respect regulatory
obligations; and you need to strengthen and sustain the bond
When the economic climate is tough and people are concerned with customers – but you cannot do any of this effectively
about job security. It’s easy to overlook the fact that people do without the commitment of your workforce.
have choice – people work for you because they have chosen to
work for you. The success of any enterprise, in public or private
sector, rests firmly on the goodwill of its employees – and on
their desire to continue to contribute positively and to the best
of their ability.
Continuity Sustainability
Device are disposable Ethical and Environmental
(responsibly) - but service responsibility is part of me.
must be continuous.
Mobility
We expect information
Digital Maturity
With 2 Billion internet users
to come to us - wherever
worldwide, we are (almost)
we happen to be.
all digitally adept.
Personal
Perspectives
and
New Ways
Global Horizons of Working Security
We work and live in a Security and compliance to
globolizad economy - be built in - too complex for
offshore is everywhere the individual.
for everybody.
Automation
Every digital experience must
be designed to help - we don't
want to be form fillers.
Pay-per-use Social Networking
Whether it's movie In both our private and
downloads or phone professional lives we expect
contracts - we want to be connected and
service transparency. collaborative.
Figure 1: Personal Perspectives and New Ways of Working
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5. In Figure 1 on page 4 we see some of the perspectives which
shape the individual’s experience of a lifestyle influenced by Political The political implications of cloud adoption
will differ from country to country and from
digital information and communications. With every one of sector to sector. What regulatory issues will
these influences, cloud and virtualization now act as experience- affect the individual enterprise, for example,
shapers: the digital lifestyle shown here would simply not be with regard to data location?
possible in a world of locally-held, device-dependent data.
Economic Cloud offers a basic shift in economic
What employees know in their private lives, now creates clear practice, as enterprises minimize capital
expectation in their working lives: investment in favour of pay-per-use service
models, but how best to compare costs
across cloud and traditional IT systems?
• eople expect to be able to work productively without being
P
chained to a single device or location
• hey expect to be able to connect and collaborate with
T Social Internet and mobile technologies change the
ways that employees, partners and customers
colleagues, partners and customers easily and appropriately
communicate and collaborate, but how does
• hey expect to be able to “click and pick” with immediate
T this shift affect your business process and
access to services and utilities culture?
• hey need to be protected from risk and from the possibility
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of error
Technological The emergence of cloud models will not
change traditional IT practice overnight.
These expectations are not confined to the “knowledge workers”. What are the implications of cloud in terms
Whatever your job, these factors come into play. A team of of business continuity and new models phase
railway service engineers, for example, needing to identify and in and older ones phase out?
fix an electrical problem in the middle of the night need easy
access to communication and collaboration tools just as much Environmental Every organization needs to make CSR part
as the planners who convene virtually in daylight for their next of its business value. Can you quantify, for
example, the extent to which new cloud
strategy meeting.
models could help shrink the current data
centre carbon footprint?
Every CIO and CFO team responsible for sourcing the business
and IT services today’s enterprises need, is now examining the
implications of cloud models. The quality of that examination Legal Pay-per-use service models demand new
kinds of business contract – often with new
will always be boosted by those who start by placing cloud in kinds of service provider.
the context of the new world of work – and asking how the Is your understanding of cloud contract good
potential of cloud seen in private use of digital technology can enough to assure continuity and security?
be appropriately adopted for the enterprise.
At KPN we take this analysis a stage further, and encourage our
clients to evaluate cloud scenarios for their individual enter-
prise according to the PESTEL model. This exercise invites
critical and candid examination. The value gained will be
proportional to the breadth of professional interest around
the table, with CIO and CFO teams essential contributors.
Change and Opportunity
So what does the cloud challenge? It challenges entrenched
notions of how IT works and how its associated services are
procured and delivered. It also challenges the operational and
organizational roles which have served the enterprise until now.
The CIO team have, to a large extent, been the gatekeepers for
all IT provisioning. When a business unit has needed processes
and technologies to support a new business development, the
CIO team have been responsible not just for delivery. They have
also been responsible for:
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6. • nsuring that new developments are integrated with existing
E For the immediate future, the CIO team has an indispensible con-
systems and practices tribution to make to cloud strategy – specifically with regard to:
• hat the rules of standards and governance are applied,
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and where necessary, refined to accommodate the change • he need for ongoing integration of cloud and non-cloud
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• aking sure that every innovation is cost-justified, and
M approaches
managed within budget • The impact on overall security, governance and regulation
These obligations have been made continually more challen- If the CIO team takes ownership of this inevitable move to
ging in recent years in the face of relentless pressure to reduce cloud-based delivery, then they will continue to be in a position
IT spend and in the need to achieve ever greater degrees of to make an essential contribution to the evolving enterprise.
flexibility – delivering in shorter timeframes, and being able If, on the other hand, they attempt to stand against the tide,
to scale up and down as business conditions change. then they will rapidly be marginalized within the enterprise.
Their authority and budget will soon be eroded as other functions,
Even though the CIO team may be fully conscious and and the CFO team’s in particular, step in to fill the gap.
sympathetic to the influences of the new world of work
described previously, the challenge of simply maintaining an Building on strength
acceptable degree of operational continuity at acceptable cost The cloud impacts your organization from technological, legal,
has often outweighed the desire to create new and more organisational, physical and financial perspectives. The depth of
dynamic working practice. experience of the CIO team in all of these areas makes their
contribution critically important, particularly with regard to the
The arrival of cloud as a viable model for sourcing and delivery need to sustain concurrency and integration with existing
now makes it essential for every CIO team to review current systems and processes.
practice, and to ask how these new approaches can be
managed to co-exist with the heritage landscape for the KPN has observed a change amongst its own customers, not so
foreseeable future. much in focus as in attitude. When IT “owned” the technology
and the resources, it was able to take a position of controlling
This reappraisal is not primarily about technology choices. authority over everything from hardware purchase through to
It is about the operational relationships between established Internet security policies.
business functions:
This position of authority is no longer sustainable in the face of
• hen business units can buy services on the open market,
W cloud. The stance now becomes one of collaboration and advice.
independently of the IT function, how is the authority and The snapshot below gives an idea of how the CIO team position
influence of IT affected? will change – although the ability to run all heritage systems
• hen the CFO team and procurement functions can buy
W and practices continues to be a parallel requirement
services on a pay-as-you-go basis, how is the relationship throughout the shift to cloud.
with IT affected – and how is the IT budget realistically
allocated from now on?
Focus CIO Team Position
Pre-cloud Cloud
Technological Holds approver rights for all enterprise technology choices Manages the implications of technology-independent service
choices
Legal Designs IT practice to meet externally specified compliance Works proactively with legal and compliance to safeguard
and regulation service decisions
Organisational Accepts and executes commissioned work from within the Builds and promotes the overall repository of enterprise
enterprise service practice
Physical Runs and/or manages the physical infrastructure either Manages the crossover between cloud and non cloud
themselves or through third parties resources and practices
Financial Holds and presents IT budgets, usually with significant capital Minimal capital investment. Develops new financial
investment forecasting based on service rather than license/ownership.
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7. Collaborative Shift From IT Service Company to Cloud Services aggregator
As cloud now becomes mainstream for the enterprise, every Enterprises and their business partners grow together. As needs
successful CIO team will become more consultative and less and circumstances change, so does the partner’s own position.
proscriptive. The management and evolution of the enterprise Close examination of this shifting scenario with our enterprise
IT estate has always been a means to an end – and the end has clients over the last two or three years has lead KPN to redefine
always been the provision of business services. its own enterprise IT position.
With the arrival of cloud, a significant tranche of the IT element Rather than thinking of ourselves as an IT services company,
disappears altogether, as the focus shifts to pure business we now see our role very much as being a cloud-driven services
service. When, for example, an enterprise is able to take an aggregator.
HR management system directly as a cloud-based service rather
than as a series of applications and databases which need to be Rather than attempting the impossible task of taking ownership
physically hosted, managed and maintained, then the enabling of all cloud-sourced services for our enterprise clients, we act as
role of the CIO team changes accordingly. a service coordinator, able to bridge the gap between traditional
and cloud delivery for our clients. In this role, we are able to
This shift from IT manager to service enabler also has a bring our clients the maximum value of our experience in IT
significant impact on a company like KPN. Until now, the KPN and telecommunications, while extending these capabilities to
Corporate Market function has been focused on IT service embrace the management of the full array of third party cloud
provision. We have managed desktops, data centers and provision.
networks because that is what our clients have needed us to do.
Just as the cloud forces a shift from IT to business service In this respect, we are also acting from a position of experience.
provision for the CIO team, so it does for KPN Corporate Market Many major IT service contracts require the prime contractor to
– and every other IT services provider: manage multiple specialist third parties, while presenting a
• hen the enterprise desktop is virtualized, and “bring-your-
W single and transparent progress, performance and pricing view
own” becomes a viable reality, the IT service provider is no to the client. The same skills in managing and aggregating
longer required to deliver traditional locked-down desktop reporting data in complex enterprise IT service contracts are
services. directly transferable to our new role as Services Aggregator.
• hen the enterprise is able to take advantage of storage and
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processing “on-demand”, then the focus on outsourced In addition, because we span both the traditional world of
management of the enterprise data center shifts to the owned and outsourced IT service and the new world of
provision of scalable storage and processing resource. virtualized business services, we are in an excellent position not
• hen all services, fixed and mobile, are delivered via the
W just to help clients take full advantage of these new delivery
Internet, then the critical demands on the network and the models, but also to safely transition to them.
ability to source and manage the best deal and the best
performance from telecommunications service providers This is important. No organization is starting from zero: every
becomes a priority. enterprise must continue to build on current investments, even
if in the longer term target much of the current base will be
decommissioned. All our clients have data centers, legacy
systems, standardized infrastructure and custom applications.
As a Services Aggregator, we will help clients leverage these
investments, creating a service mix based on workspace,
connectivity and data center domains, designed to enable the
New Way of Working described at the start of this paper.
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8. Client
Services Aggregator
Billing Access Security Integrated Service
Management
Workspace Connectivity Data Centers
Legacy Standard Cloud 3rd Party Cloud Service
Figure 2: KPN Corporate Market Services Aggregator
As shown in Figure 2, in its role as Services Aggregator, KPN The overall service catalogue is tiered, allowing KPN Corporate
Corporate Market established a simplified single interface to Market clients to decide how they want to serve and equip
the hybrid worlds of legacy and cloud delivery, and most employees:
importantly, is able to act as a rationalized gateway to third • nterprise profiles – what services do you want every
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party cloud services. member of the extended enterprise to be able to use?
These may include enterprise social networking and
Services Aggregator Snapshot communication programs, for example.
In the new world of cloud service provision, the boundaries • epartmental profiles – what do specific communities within
D
become much freer. As an IT Service provider, we were keen to the enterprise need to excel? Even though different commu-
deliver a comprehensive and clearly documented framework of nities need different toolsets, we need to understand how
services. access to common data boosts innovation and efficiency
across increasingly interconnected departmental functions.
As a Services Aggregator, we are no longer working to a “fixed • eam and taste – teams are dynamic and personal tastes and
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menu”: whatever our client chooses to source using cloud- preferences are individual. How can we make it easy and safe
based provisioning can potentially become part of the mix. for teams and individuals to set their preferences across a
We offer a combination of services targeted at large and range of cloud-based business services?
midsized enterprises, conceived and presented according to
the professional profiles of the different communities within
the enterprise.
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9. Service Profiling Why aggregate?
By designing access to services according to specific profes- As a Services Aggregator, KPN Corporate Market is able to help
sional profiles, the Services Aggregator approach simplifies all rationalize cloud adoption which, without this degree of
aspects of access and administration. Access is managed via a intelligent service profiling would soon become so fragmented
suite of portals, implemented for each enterprise client and that any overall view of trend and usage would become
then presented to the different communities within the client impossible to achieve.
organization according to professional need.
An integral and associated benefit is seen in the ability to
Service profiles will fall into one of eight broad categories, each maximize the efficiency of billing and account management.
of which can then be tuned in turn according to the needs and Without this service aggregation function, each service used by
preferences of those to whom it is addressed. the enterprise would be billable individually. This is clearly not
sustainable in terms of either the ongoing management burden
or in terms of understanding usage and costs.
Portal Type Function and characteristics
1 End-user Every employee of the client enterprise can shop – browsing, requesting and managing
different services, from acquisition through to service termination. End users can personalize
both their environment and their access support preferences.
2 Budget Holder Budget holders can set the limits of end-user profiles, typically indicating the range of
authorized services for each end-user and approving or declining service requests which
fall outside the agreed service set.
3 Customer Store Portal: Each enterprise customer has a dedicated service store, from which employees and
ICT Manager employee administrators can define and administer profiles. The portal’s ICT Manager
toolset allows the client technology team to order, monitor and scale ICT services to
meet changing user requirement.
4 Customer Store Portal: The system administrator portal provides the tools needed to define user groups, manage
System Administrator all universal services, and personalize the default environment to the specific enterprise.
5 Customer Portal: The customer portal ICT manager view provides a comprehensive technology view of all
ICT Manager cloud-usage across the enterprise.
6 Customer Portal: The customer portal sales manager provides a corresponding view of the commercial
Sales Manager usage of enterprise cloud usage. This makes the service costs of changing monthly usage
clearly auditable and delivers an essential guide to trend and consumption.
7 Customer Portal: The customer portal system administrator can create, personalize, manage, and remove
System Administrator store portals at both a departmental and enterprise level.
8 KPN Corporate Market: The KPN Corporate Market portal administrator is the counterpart of the customer portal
Portal Administrator system administrator, and will ensure that the client’s cloud service requests and preferences
are professionally managed. This function also delivers the comprehensive log files used to
check technical and functional performance and support targets.
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10. By providing the means to aggregate cloud service invoices into Benefits and Recommendations
a unified service statement, KPN Corporate Market will eliminate Initial reactions to the KPN Corporate Market proposition as a
the need to manage multiple, complex and highly fragmented cloud Services Aggregator from both clients and analysts have
service charges. been positive. Indeed, in the Forrester1 report, “Cloud Broker
— A New Business Model Paradigm”, KPN is recognized as “one
The advantages of working through a Services Aggregator are of the most sophisticated in the market and among the first full
not, however, limited to transparency in usage, trends and cloud brokers globally”.
billing. It also makes a significant contribution to best practice
in governance and security. Because of our dual enterprise IT service and telecommunica-
tions heritage we are well-positioned to enable organisations
Without a highly structured and intelligently automated means to bridge existing legacy/IT with new, cloud-based technolo-
of creating accounts and commissioning services, the enter- gies. Our depth of experience in workplace services is
prise is soon left with an uncontrolled situation in which it is particularly valuable in the transition to cloud-based delivery:
impossible to discriminate between active and ghost accounts. the profile-driven approaches to ensuring that the workplace
fits the professional needs of the individual employee translate
Because KPN Corporate Market team is able to assume full directly into the value of cloud delivery.
responsibility for the Identity and Access Management process,
we are well-positioned to rationalize the shift to cloud in terms Few enterprises today rely on a single provider for all IT services.
of governance and security. The benefits extend fully to the user As cloud delivery comes to account for a larger and larger
experience: by managing single sign-on across multiple service proportion of the “IT service spend”, this diversity of supply is
accounts, for example, we eliminate the need for individual set to increase even further.
members of the workforce to adopt and remember multiple
passwords. The benefits of the shift to cloud have been explored in depth
in recent years, with the ability to scale according to demand;
The physical depth of our position as a Services Aggregator the ability to minimize capital expenditure; and the ability to
then becomes the final element of the proposition. rapidly source and adopt innovation without excessive risk all
KPN Corporate Market owns and operates a network of Tier 3+ identified as critical characteristics.
data centers, ensuring physical control over all data relating
to Identity and Access Management, with scalable resource The benefits, however, will be compromised if the cost of
for all storage, back-up and archival requirements. adoption lies in increased administrative and management
burdens, and in the failure to sustain responsible models of
Network differentiation governance.
As enterprise cloud adoption gathers momentum, we are unlikely
to see simple single delivery models adopted uniformly. The Services Aggregator model is very new, and it is largely
The diversity of culture and regulation found in different untried. However, by considering partnership with a services
industries and different geographies is not going to disappear. aggregator – and especially one with the depth of IT service and
telecommunications expertise as KPN Corporate Market – you
The broad combination of on-premise, off-premise, private and stand to gain the agility and cost benefit of cloud while main-
shared, hosted and co-located cloud delivery models is set to taining the overall vision and transparency which both CIO and
remain in place for the foreseeable future. Across all these CFO teams have strived so long to achieve.
models, however, dependence on high-performance and
high-resilience networking remains absolute: any network In terms of practical next steps, KPN Corporate Market has
compromise results in a corresponding dip in the performance developed a Cloud Migration Framework and a range of
and reputation of cloud services. introductory and consultancy services designed to allow you
to explore, and trial the options. These include:
Membership of the KPN Group helps differentiate the KPN
Corporate Market positioning as a cloud Services Aggregator. • loud readiness assessment, business case, roadmap and
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Every aspect of connectivity is fully backed both in terms of transition services
skills and investment in fixed and mobile, wired and wireless • aaS selection analysis – examining the options including
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networking. This is not just true in the KPN European heartland: Google vs Microsoft
extended global alliances deliver parity of network perfor- • loud quickstep with Rapid Deployment eXperience (RDX)
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mance and reliability right around the globe. for Office 365
• loud Integration Services – exploration and analysis
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1 Cloud Broker — A New Business Model Paradigm, Forrester Research, Inc., August 10, 2011
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11. About the author
Maurice Remmé is Director Customer Advocacy
at KPN Corporate Market and has over 12
years of experience in the ICT industry.
He is actively involved in the development and
implementation of the KPN Services Aggregator
and cloud strategy.
More information
You can contact Maurice Remmé directly
via e-mail: maurice.remme@kpn.com or
via Twitter: @MauriceRemme.
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