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Event-driven deliveries

How is changing customer demand affecting your IT strategy?

Traditional mail volumes are decreasing by 10% a year, but the volume of parcels is going up. That’s transforming our business whether we like it or not. To be able to handle parcels, you need to approach delivery in a different way: people want packages delivered at certain times of day, they want you to be able to drop it at the local supermarket or with the next-door neighbour, and they want you to let them know that this has happened. I don’t think there is anyone who has tackled that successfully yet, but we don’t want to be the last.

How do you plan to address this?

It is one of the motivations for the events network that we are currently planning, which will underpin every event that happens in Royal Mail.

Any time an employee use a machine, such as a PDA, that isn’t part of a big application like SAP or our CRM, that machine will publish an event to the network. Each event will ‘decide’ where it needs to go – whether it is into SAP, or a messaging database, or to the customer to tell them where their package is.

At the moment this is in the conceptual phase, and we’re going out to tender. This is effectively going to be based on complex event processing (CEP) technology, although we don’t have complex events; rather, we have simple events at scale. That is why the CEP architecture is the right one – because it is a very distributed architecture.

Will this be a cloud-based system?

We are not going to direct the market on that. One of the things we are going be asking prospective suppliers is whether they would host it in a traditional data centre or build it as an infrastructure-as-a-service offering. We need to hear what the market thinks is the best way to do this, given the scale and volume of messages that we are going to have. However, in the long term, everything is going to be based on a cloud.

Scalable computing

What makes you believe that?

The reason is that I think the traditional outsourcing model is broken. I don’t think the traditional outsourcers get it, though, and I know why they don’t get it: if they moved to a truly service-based model, they would end up cannibalising their traditional revenue streams.

How do you see your organisation procuring cloud-based services?

As an organisation, I don’t want to buy cloud services directly from Amazon Web Services, and I don’t want to go to a systems integrator, who will build a custom system and host it in a traditional data centre. I want to go to a ‘services integrator’ who will provide me with a given set of services and with a given service level agreement associated with it. I don’t care, at the end of the day, where the underlying infrastructure is.

What would be the advantage of this approach?

We want to pay for IT on a demand basis. We currently have an enormous amount of infrastructure to deal with four days’ business around Christmas, which is nuts. It just sits there eating up the atmosphere.

And we’re in a pretty cash-strapped economy at the moment; we can’t afford to do massive procurements in which we pay for everything upfront. What we have to do is align our IT costs with our revenue.

Are suppliers happy to operate in this way?

No. I’m finding that we’re having to do a lot of work in persuading the systems integrators that this is the kind of model we’re looking for.