The Modern NOC

IT OpsPredictionsfor 2018

Introduction

If Your Role Is: See These 2018 Predictions

The pace of IT automation in the last decade has been staggering. The data center has transformed. Workloads have migrated to the cloud. Applications have been re-architected to microservices. Both applications and infrastructure have become increasingly fragmented, distributed and dynamic. When IT operations becomes a bottleneck, the whole organization suffers.

It’s clear that to keep pace with continued digital transformation of the enterprise, IT Operations will continue to be rocked by paradigm shifts in 2018.

Automation has helped enterprise IT to modernize, and yet somehow the role of Service Operations has been left behind. When services go down, every minute means lost revenue. Front-line “level one” operators and engineers continue to be overwhelmed by the flood of event data generated by IT monitoring tools – especially alert data – causing stress and frustration. Whether called a NOC or DevOps or SREs, the teams responsible for delivering quality of service should heed the trends predicted in this ebook.

IT Executive

NOC Management

Tools Architect

NOC Operator/ Engineer

1 2 3 5 7 8

2 4 5 6

2 3 8

431 7 8 9

No matter your specific function in IT Operations, BigPanda is pleased to bring you these 2018 predictions.

1

2018 Implication for Your IT Operations team:

Forward-thinking digital businesses will continue to sunset their legacy vendor solutions in favor of newer, cloud-based alternatives.

DevOps Organizations reporting that by 2021,

All New Services will be Deployed in the Cloud 80%

80%

The Modern NOC - Predictions for 2018 | 1

2016 2018

On premises

2020 2022 2024

0%

20%

40%

60%

80%

Going for Flexibility: Enterprise Computing Workloads are Departing to the Cloud

Off premises Cloud providers

Legacy Maintenance Costs as part of Software

Total Cost of Ownership

The death knell is finally sounding for the legacy Event Correlation & Analysis

(ECA) market, long controlled by aging solutions from players such as IBM, HP,

BMC and CA. Cloud adoption and DevOps are finally killing the traditional

solutions stack. Infrastructure-as-code is supplanting the physical datacenter.

Mission critical environments with high workloads are moving to the cloud. The

centralized NOC is evolving to a more distributed model with complex incident

escalation workflows. Meanwhile the legacy ECA vendors are not investing in

any new features or innovation. Many enterprises feel stuck paying

“maintenance taxes” to these providers because they think it's too hard to

replace them. Other negative impacts include the cost of hardware, the cost of

downtime required for upgrades, and the retirement of skilled resources with

legacy expertise.

Legacy Event Management Solutions Enter a Death Spiral

Sources: Gartner,Forrester, IBM

Source: Gartner

Source:

Increased Investment in IT Automation Benefits Digital Operations

In 2017, only one-fifth of organizations included “modernizing IT Operations” in

their overall digital transformation strategy, according to a study by Digital

Enterprise Journal. In 2018 we expect this number to double, with 40 percent of

top-performing enterprises increasing their investment in IT automation

technologies as a business strategy. We've reached a tipping point. Most

enterprise IT organizations have automated the software development lifecycle.

They have virtualized the datacenter. Now a clear majority of organizations - 63

percent - express the desire to improve their IT alerting & notification

capabilities, including automated incident escalation processes. This increased

investment will comprise not just new automation technologies, but IT “service

operations” – the people and processes that keep IT services operating

smoothly.

2018 Implication for Your IT Operations team:

Consider increasing investment in automated alert management capabilities as part of a drive to digital operations.

2

Implementing Automation Software

Expanding Existing Automation Footprint

Other

29%

201851%

71%

40%

53%

The Modern NOC - Predictions for 2018 | 2

Source:

Increase in Interest in IT Automation since 2011

Source: Digital Enterprise Journal

Digital Transformation Initiatives that will be

Supported by AI/Machine Learning, by 2019

Source: IDC

CIOs citing Machine Learning as a Core

Investment Priority

Source: ServiceNow

More Intelligent Monitoring Will Not Solve the Alert Noise Problem

Alert storms remain as inclement as ever. New machine learning offerings by

monitoring tools such as Splunk ITSI and AppDynamics/Perspica, while

encouraging, will not entirely solve this persistent alert management problem.

Applying intelligent capabilities to diagnostic monitoring data can better

identify anomalies so that humans don't have to configure them, but this

approach will still produce too many alerts. Machine learning when applied to

alert data that’s correlated across ALL enterprise monitoring tools provides a

more holistic view of critical incidents by adding change data and other

contextual information necessary to speed MTTR.

2018 Implication for Your IT Operations team:

Evaluate new machine learning offerings with a primary goal of reducing the total number of incidents requiring manual review.

3

The Modern NOC - Predictions for 2018 | 3

61%

More Enterprises Adopt Application-centric Monitoring

Enterprise IT operations teams are finding it hard to stretch their traditional

monitoring tools and strategies to cover dynamic, cloud native workloads. The

traditional "bottom-up" approach of very granular monitoring of individual

infrastructure components increasingly doesn't work in public clouds with their

elastic scaling and ephemeral resources. In 2018 forward-looking enterprises

will monitor business services & apps, not components. This focus on

"top-down" application-centric monitoring stresses user experience, transaction

availability and SLA compliance to measure service performance. It uses service

mapping to identify the stable, long-lived cloud elements on which any given

application depends.

2018 Implication for Your IT Operations team:

Eliminate infrastructure monitoring siloes by mapping application & service dependencies critical to delivering high availability & performance to the end user.

4

The Modern NOC - Predictions for 2018 | 4

IT Organizations reporting

Higher Customer Expectations

for Experience & Engagement

Source: Digital Enterprise Journal Source: Gartner

Source: Trace3 Research Source: Digital Enterprise Journal

IT Organizations citing Application

Performance Monitoring as

Important/ Critically Important

Average Cost of a Data Center

Outage

Average Cost per Minute for

Service Outages

68%

$740K $72K

Continued IT Staffing Shortage Drives Continued Service Automation

As enterprises continue to add new workloads and scale up relentlessly, they

will need to do so without adding additional NOC/IT Ops headcount. Humans

simply don’t scale very efficiently. The need for existing IT staff to focus on

solving business-oriented problems via digital innovation will drive the

continued automation of mundane manual IT tasks. For example, IT engineers

can concentrate on improving the customer experience only if intelligent

auto-remediation of critical incidents helps maintain service

availability/reliability without their intervention. By employing increasingly

autonomous technology to reduce MTTR and increase uptime, expert IT

resources can be refocused on adding business value.

2018 Implication for Your IT Operations team:

Plan for the continued shortage of skilled workers by automating whatever can be automated, especially in managing IT events.

5

Functions Suffering from Skills Shortage, according to IT Leaders

Big data/ analytics

Enterprisearchitecture

Business analysis

Technicalarchitecture

Security& resilience

Projectmanagement

Development

42%34% 34% 32%

28% 26% 25%

83%

The Modern NOC - Predictions for 2018 | 5

Organizations reporting the Tech Talent

Shortage has Hurt their Business83%Source: Indeed.com

Source: LinkedIn

Job Growth for Machine Learning

Experts, since 2012

1.4M 9.8XEstimated Number of

Open/unfilled IT Positions by 2020

Source: U.S. Department of Labor Statistics, Gartner

Sources:

Enterprises Will Demand BetterIT Operational Visibility

6

The Modern NOC - Predictions for 2018 | 6

45% 46%

90% 40%

IT Organizations reporting

5 or more Blind Spots in the

IT Service Value Chain

Source: Digital Enterprise Journal

IT Leaders Citing Delivery of

Better Business Intelligence as

an Operational Priority

Source: Harvey Nash/KPMG

CIOs say Greater Automation

Increases the Accuracy & Speed

of DecisionsSource: ServiceNow

CIOs who will Lose their Jobs

within 5 years due to Failure to

Deliver Business OutcomesSource: Gartner

In 2018, the nascent IT Operational Analytics marketplace will accelerate in

maturity. IT will be expected to share its business intelligence data with the rest

of the business. The focus on delivering better customer experiences will

demand IT actively optimize service performance and availability. This in turn

will drive the need for solutions that deliver operational visibility with robust

visual analytics. Moreover, ITOA will help rationalize machine learning and

monitoring tool investments. Enterprises will have clear visibility into which

“solutions” are not solving anything, and which ones are worth their weight in

gold. Gartner warns that up to 40 percent of today's CIOs could be turned out if

they fail to efficiently and reliably provide high quality results to the businesses

they serve.

2018 Implication for Your IT Operations team:

Start experimenting with emerging ITOA tools. Decide which metrics IT will share with executive leadership to support digital transformation.

IT Event Hubs Emerge in Open Integration Platforms

Open integration has been a key component of many IT operations platforms,

with some claiming to be a “system of record” thanks to wide interoperability

with myriad apps and tools. However, market momentum will build for

integration hubs specific to IT event management. Several vendors are offering

their version of a central incident data bus that marries ITOM monitoring to

ITSM ticketing systems. These special integration hubs incorporate real-time

monitoring data, change data, runbooks, even non-IT data streams – anything

that can add necessary context for speedier MTTR. Such hubs could perfectly

support intelligent workflows such as auto-remediation performed by ITSM

systems. Seamless integration between monitoring tools and IT operational

analytic systems could flow through them. “Event hubs” will exist in parallel, not

as a replacement, with systems of record.

7

16,590

18,850

2017 2018

The Modern NOC - Predictions for 2018 | 7

2018 Implication for Your IT Operations team:

Not all vendor claims of “open integration” are created equal. Evaluate them for their ability to add contextual data to speed incident resolution.

Source: Digital Enterprise Journal

Organizations Leveraging Machine Learning

that Report an Improvement in MTTR63%

Number of APIs Listed on ProgrammableWeb Directory

IT Buyers Will Start to Distinguish between Flavors of Machine Learning

In 2017 the differences between "open" and "closed" machine learning approaches

was something that only the most sophisticated IT buyers understood. To others, all

the buzz around AIOps from IT press and analysts seemed like so much marketing

fluff. However, as early forward-leaning enterprises begin to have more success with

applying machine learning to IT Ops, buyers will become more savvy. Half of IT

organizations are already applying machine learning in support more complex tasks

such as incident response, beyond simply managing alert volumes. Organizations will

have to decide between dual approaches. Black box, or “closed” machine learning, is

locked down and thoroughly trained with data by expert engineers before going into

production. White box, or “open” machine learning, is more exposed and transparent,

allowing greater user control on the fly. The correct model for any given IT

organization will depend on its unique environment and specific requirements.

2018 Implication for Your IT Operations team:

Keep any evaluation of machine learning technology focused on its ability to deliver the benefits promised, in a fully auditable fashion.

8

The Modern NOC - Predictions for 2018 | 8

CIOs who are Advancing beyond the

Automation of Routine Tasks to more

Complex Decisions

Sources: ServiceNow

Source: Gartner

Data Centers that Will Fail Operationally

if AI/Machine Learning Is Not Effectively

Applied

52%

30%

Serverless Enters the Mainstream Discussion

Serverless Computing is the next evolutionary step for software architecture in

the face of digital transformation. In the data center, going serverless moves

beyond provisioning virtual machines to buying dynamic workloads. More

forward-looking enterprises will start exploring serverless architecture in 2018.

Why? Because going serverless reduces many risks associated with scaling

digital operations. Visibility is important to manage alert volumes and ensure

the performance of service workloads. There's still a long way to go before

serverless becomes the dominant paradigm, but the coming year will see the

concept become part of the mainstream dialogue regarding the future of IT

Operations. By 2020, Gartner predicts that serverless will emerge as a leading

platform architecture for cloud-native application services.

2018 Implication for Your IT Operations team:

Your enterprise IT organization should begin playing with serverless in research & development, if not yet in production.

9

The Modern NOC - Predictions for 2018 | 9

Physical Servers

Virtual Machines/Containers

Functions

Source: Adrian Cockcroft

$100 - $1,000 per month

$10 - $100 per month

$1 - $10 per month

42%

Source: Trace3 Research

Average Increase in Annual IT Operating Cost per

Server with a Performance Monitoring Solution $800

AWS Lambda Revenue

Growth, 2016 to 2017

+5%

+12%

Serverless Solution Adoption Rates

2016 2017

References

Databorough: “Software Maintenance Productivity Factors”.

Digital Enterprise Journal: “Modernizing IT Operations for Digital Economy”, August 2017

Forrester Research: “Automation Drives the I&O Industrial Revolution”, November 2017

IDC: “The Dawn of the DX Economy and the Rise of the Digital-Native Enterprise”, November 2016

ServiceNow: “The Global CIO Point of View”, October 2017

Gartner: “End-User Experience Monitoring Is the Critical Dimension for Enterprise APM Consumers”, September 2016

Co.Design: “Dollars And Sense - The Business Case For Investing In UI Design”, March 2012

Trace3 Research: “360 View Trend Report: IT Operations Monitoring & Analytics”, February 2017

Digital Enterprise Journal: “Modernizing IT Operations for Digital Economy Research Study”, August 2017

Gartner: "Service Providers are Waging War Against U.S. Talent Shortage With Unconventional Methods," 2015

Indeed.com: “Is the Tech Talent War Hurting Innovation? Hiring Managers and Tech Recruiters Respond”, December 2016

Harvey Nash/KPMG: “CIO Survey 2017 - Navigating Uncertainty”

ProgrammableWeb API Directory

Adrian Cockcroft: Monitorama 2016, “Monitoring Challenges”, June 2016

About BigPanda

BigPanda Inc. enables Enterprise IT to intelligently automate

and scale Service Operations to meet the complex demands of

the modern datacenter. The company’s algorithmic machine

learning platform turns IT noise from fragmented clouds, teams,

applications and monitoring tools into actionable insights to

speed the resolution of IT incidents. Many of the world’s largest

enterprises such as Intel, Workday, News Corp, Macy’s, and Cisco

rely on BigPanda to power their Service Operations.

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