HP execs map new ‘adaptive enterprise’ strategy

On the one-year anniversary of its acquisition of Compaq Computer Corp., Hewlett-Packard Co. mapped out its vision for focusing its broad resources on helping enterprises optimize their technology investments by more tightly linking IT and business operations.

Announced at a press event in San Jose Tuesday, HP’s “adaptive enterprise” strategy touches all aspects of its software, services and hardware portfolio. Emphasizing automatic management, straightforward integration, and architectural flexibility, the approach echoes moves made lately by several of HP’s rivals, most notably IBM Corp., which has for months been pursing a similar strategy it’s dubbed “on-demand computing.”

In a play on IBM’s tagline “e-business on demand”, HP CEO Carly Fiorina claimed that her company’s adaptive strategy is about demanding more. “The truth is technology should be, and can be, understood in terms of the results it delivers,” she said. “It has to yield to the demands of business.”

HP’s strategy centres around a reference architecture, called Darwin, designed to integrate business processes with virtually every enterprise product, service and standard that HP supports: everything from J2EE to .Net, to software from PeopleSoft Inc. and SAP AG. “The goal is to have infrastructure that is standardized and modularized and integrated,” said Fiorina.

Looking to turn questions about the success of the Compaq merger into a competitive advantage, Fiorina said that the challenges in merging the two companies’ operations had actually made HP stronger. “Like evolution, it’s how a company reacts and responds and adapts to change that’s the difference between competitive vulnerability and competitive success,” she said.

In fact, Fiorina claimed that some of the ideas behind Darwin were developed within HP as the company struggled to integrate the infrastructure of 1,200 networked sites, 7,000 applications and 21,671 servers that the merger created. “Change presents opportunities,” she said. “We are bringing to market the distillation of the integration experience that we have been through.”

She added that since the merger, HP had reduced its own IT costs by almost 25 per cent. “This is what we mean by demand more,” she said.

An array of partners have lined up to support HP, including Accenture Ltd., BEA Systems Inc., BearingPoint Inc., Cisco Systems Inc., Deloitte Consulting, Oracle Corp., PeopleSoft, SAP and Siebel Systems Inc. With the goal of simplifying systems management and integration at the heart of its message, company executives say partnering will be key to carrying out HP’s vision.

According to one of HP’s customers, Sprint Principal Network Design Engineer Tom Steele, another benefit of the merger has been a change in HP’s culture. “If anything, we’ve seen that old Compaq Tandem culture come out in HP,” he says. “Now we see a lot more of the HP reps.”

Sprint has worked with HP to implement a Zero Latency Enterprise architecture that integrates Sprint’s telecom networking data with its other systems, including customer relationship management, bandwidth management, and fraud detection.

As part of the event Tuesday, HP announced 15 new products and services supporting its adaptive enterprise push. Among the announced software offerings are HP Virtual Server Environment, a virtualization tool powered by an enhanced version of HP-UX Workload Manager. This software, available now as part of HP’s Mission Critical version of HP-UX, lets HP machines band together and add or reduce the number of processors they are using, depending on application requirements. “The server gets bigger or smaller, depending on your workload,” said HP Director of Utility Computing Nick van der Zweep.

HP also announced Software Self-healing Services for HP OpenView, which are intended to expand the dynamic allocation and troubleshooting capabilities of HP’s network management software.

The self-healing services features will first be available for HP’s OpenView Operations and Network Node Manager, and will roll out over time throughout the entire OpenView line, HP said. Within the next 12 months, the company will introduce adaptive-enterprise-themed enhancements in the areas of virtualization, automatic provisioning, business impact analysis, service-level agreements (SLAs), dynamic deployment and maintenance of management functions, policy-based IT flexibility, and service lifecycle management, the company said.

Embedding itself deeply within its customers’ IT infrastructures is part of HP’s game plan, and in launching its new vision, the company made sure to highlight one of its biggest wins: a just-finalized US$3 billion, 10-year managed services contract with Procter & Gamble Co. Approximately 2,000 P&G employees from 48 countries will become part of HP Services when the agreement commences on Aug. 1, pending regulatory approvals.

The P&G deal is one of more than 200 managed services contracts HP has signed since acquiring Compaq, the company said.

HP’s rivals were quick to cast the company’s “adaptive enterprise” campaign as a marketing manoeuvre posing as an operating strategy.

“This is a repackaging of what we’ve seen come out over the last few months,” said Sun Microsystems Inc. Manager of Competitive Strategy Paul Phillips. “They’ve now done what IBM’s favorite trick is: put a big banner out there they can later put anything they do underneath.”

Sun has also been emphasizing a simplified, flexible approach to IT management through its N1 initiative. While Sun took a “clean slate” approach to fashioning N1, HP is shaping its strategy around its existing OpenView line, according to Phillips.

“Our take on it is they are applying a somewhat old software technology and methodology to what is a newer problem,” he said.

Computer Associates International Inc., which spoke last week of its own commitment to on-demand computing and related additions to its Unicenter line of management software, said HP is too focused on its own proprietary technology.

“It’s obvious that HP’s primary support is for HP. We don’t see any plans for their Virtual Server Environment to support any non-HP platforms,” said David Hochhauser, CA’s vice-president of Unicenter marketing, in an e-mailed statement. “Customers who also have IBM or Sun servers are going to have to look to platform-neutral vendors like CA.”

HP’s plan is to eventually extend the Virtual Server Environment to the Windows and Linux operating systems, though no timeframe is out yet on when the extension will be available, an HP spokesperson said.

Services vendor Electronic Data Services Corp. (EDS), which has suffered through financial problems and the recent ouster of its CEO, also jumped on the on-demand bandwagon, touting on Tuesday its “agile infrastructure architecture” approach to utility and integration services.

“This is our party, we set the table two years ago,” EDS Executive Vice-President Doug Frederick said in a prepared statement. “Hardware vendors are pushing utility computing on their terms, their hardware.”

While HP executives claimed Tuesday to be 18 months ahead of the rest of the industry in implementing a true virtual data centre, analysts at the event said that in reality the differences between HP and competitors like IBM are far less dramatic.

“It’s almost like an arms race,” said Forrester Research Inc. Vice-President Bill Martorelli. “These things are long on vision…If you want to remain viable as a large-scale supplier of IT, you have to put together a road map first.”

But as vendors squabble over whose on-demand approach is the purest and most customer-friendly, it helps the industry to at least have everyone singing the same tune about a standards-based, modular approach to building a modern IT infrastructure, Sun’s Phillips acknowledged.

“Anybody who helps that dialogue helps everybody. It helps all the vendors to spend less time explaining what they’re doing and more time talking about their implementation and how they’re approaching it,” he said. “All (the vendors) have gone from fairly straightforward things 10 or 15 years ago, building servers and such, to building whole technology infrastructures. It helps everyone to have vendors talking about that level of complexity, and how integral (those IT infrastructures) are to the business as a whole.”

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