Part 2: Continuous delivery tool chain efficiency > Outsourcing savings
(Check out Part 1 of the series Will DevOps Kill IT Outsourcing?)
Experts on digital disruption and DevOps practices are vocal in their belief that DevOps and traditional outsourcing models don’t mix well.
“Adopting DevOps requires organizations to erase the barriers between development and operations teams,” says Dan Cornell, CTO of Denim Group. “This is hard enough to do within a single organization and nearly impossible to do across organization boundaries.”
If push came to shove and an organization needed to justify an either-or decision for DevOps over outsourcing, the argument would likely revolve largely around business value. Continuous delivery makes it possible to move to market more quickly, develop products better aligned to customer sentiment and kick the pants out of competitors who don’t do the same. That was the impetus behind the shift at GE Capital. Last year the firm’s CIO Jim Fowler said he was looking to significantly reduce IT outsourcing and shift toward more Agile teams. Earlier this summer Matt Merchant, former global managing director of DevOps for GE Capital gave DevOps.com a snapshot into how this is driving innovation. (Ed. Note: Merchant suddenly passed on this summer. Our interview was just prior to this tragic event.) He explained how the company was able shift customer-facing mobile app development from a six- to eight-week release cycle to twice weekly.
But the decision to dump outsourcing in favor of supporting DevOps practices within a more centralized IT group doesn’t just have topline revenue and innovation benefits. The upside presents itself in the bottom line as well.
In many ways, we can chalk that up to the fact that the automation and cloud technology that facilitates continuous delivery is light years ahead of where it was when belt-tightening outsourcing deals crescendoed following the 2008 financial crisis. As things stand, the cloud has enabled IT to decouple infrastructure outsourcing from operational and process outsourcing.
“Companies today realize they can achieve many of the cost efficiencies that outsourcing was originally intended to achieve by leveraging cloud technologies,” says Thomas Enochs, vice president of customer success at Chef . “There is a general trend towards leveraging cloud services rather than cheap labor to achieve the scale, speed, and flexibility they desire.”
The fact is that many an outsourcing deal was born in a day when the tools of development were slow to deploy and expensive.
“DevOps practices and modern software tools have drastically reduced the time and cost required to develop custom applications,” says Bernard Sanders, CTO of CloudBolt Software. “In the early 2000s, the step of just getting the servers and infrastructure set up for a new app could be a multi-week or -month chore.”
Virtualization vendors, cloud providers and self-service automation have all made it possible for developers to get easy and affordable access to the infrastructure they need when they need it, Sanders says. And then there’s the advances in deployment pipeline automation that are seriously streamlining hand-offs over the course of the software development lifecycle. It’s all adding up to added efficiency and reduced cost of development and deployment.
“In the future, the overhead required to build custom apps will be driven to near zero, and enterprises will be able to in-source this development, retaining this function that has become key to enterprises’ brand identity, product offerings, and customer experience,” Sanders says.
Even now, though, the DevOps toolchain is completely blowing up a lot of the financial models that initially drove IT departments to aggressively outsource. While many outsourcing deals continue to be renewed without reviewing old assumptions, this is starting to change.
“We have seen cases where outsourced functions like automating test or other processes has been brought back in house because equipped with the right approach and tooling, the internal team could achieve better results, but also because the automation work was a key building-block to a longer-term DevOps plan,” says Alex Henthorn-Iwane of QualiSystems.