Many executives are under pressure to develop successful data center strategies that work for their organization, according to industry-specific criteria. While data centers have been in use for decades and began as largely in-house centers for proprietary data, they have evolved. In the 2020s, they are more likely to be remote facilities or networks of facilities owned by cloud service providers housing virtualized infrastructure for the shared use of multiple companies and customers. This note offers an overview of the types of data centers, including enterprise, cloud, and colocation; a brief history of data centers; and data center statistics, including especially costs and energy efficiency. With the rise of artificial intelligence, the Internet of Things, and edge computing, among other innovations, data centers are in high demand and evolving to meet it. This note includes video of Jim Miller, a tech industry executive and an expert in the field, discussing hyperscalers, the early days and evolution of data centers, and what's involved in scaling a data center. Along with related notes, this technical note is updated regularly in response to changes in the technology and industry. At the Darden School of Business, it is taught in an MBA course on "Digital Operations."
This note introduces cybersecurity what it is, why it is needed, and current practices and solutions. While the broad issue of information security is a concern for governments and individuals, this note focuses on internet-related risks facing private-sector enterprises. Cybersecurity is, or should be, front and center in the minds of leaders at companies that are adopting and applying digital technologies to transform how their companies operate. Those technologies continue to advance in some cases at mind-boggling speed. Think artificial intelligence (AI), cloud solutions, enterprise integration, 5G communication, the Internet of Things (IoT), robotics, and more. While these technologies promise to increase an enterprises efficiencies and deliver better customer services, they also introduce a new business risk: cyber risk. Cyber risk means risk of disruption of an enterprises operations, damage to its reputation, or both, caused by the deliberate actions cyberattacks of outsiders (cybercriminals) or enterprise insiders. Once thought to be the responsibility of an enterprises information technology (IT) department, cybersecurity the prevention of and response to cyberattacks is now every employees responsibility, from hourly workers to the board of directors. At the Darden School of Business, this note is taught in the second-year elective Digital Operations class; it would also be suitable in a module covering cyber risks.
This final note in the five-part series on competitive-cost analysis introduces the concept of the experience curve, which can be analyzed with a log-log relationship between unit cost and cumulative volume.
The Internet of Things (IoT) can be generally explained as a network of objects that collect data regarding their surroundings and transfer it across the internet to various systems. While the addition of more information can improve a business's data-driven decision-making, should all businesses invest in IoT? This technical note explores IoT technologies, discusses how it is being used in industry, brings up some advantages and disadvantages, offers examples and applications, and investigates how it might fit into a firm's digital strategy.
A digital twin can be described as a digital model of a real object. But what makes it different from a prototype? How are digital twins being used in business settings outside manufacturing? How do they relate to machine learning and augmented reality? When digital twins meet their fullest potential, they enable businesses to optimize operations by managing their assets more efficiently, generating higher productivity, and reducing costs. This technical note discusses some potential benefits and drawbacks of digital twins; offers examples in aviation, car manufacturing, and agriculture; and helps managers identify where implementing the technology may be useful.
As companies increasingly rely on data and analytics to make decisions and improve their operations, it becomes clear that data quality can be a major issue. The insights gleaned from data analytics are useful only if the data is of high quality. This note summarizes some common issues that can result in low-quality data and explores the crucial task of data engineering. This note is taught at Darden in the second-year elective, "Digital Operations." It would also be suitable in a course or module covering data analytics.
This technical note provides a general overview of cloud computing and how businesses are using it to achieve their digital goals. Specifically, this note outlines the different service models that cloud computing supports, including Infrastructure-as-a-Service, Platform-as-a-Service, and Software-as-a-Service. The note also details some of the advantages and disadvantages of cloud computing, and it reviews the cloud computing industry and some of its top players.
This technical note details virtual and augmented reality and how these immersive technologies can be used in business. Specifically, this note highlights several business applications of both virtual and augmented reality-describing each technology's advantages and disadvantages. Various companies have uncovered new and interesting applications using these technologies, ranging from assisting distribution-center workers to improving learning and development. This note is taught at Darden in the second-year course, "Digital Operations." It would also be suitable in a course focused on technology strategy covering virtual and augmented reality or a module on the metaverse.
The task before Siddhidhar Parulekar seemed challenging. Only eight months before, in March 2021, he had joined Dovrex Company (Dovrex) as senior director of global strategic supply chain. In an industrial-equipment company that utilized roughly a thousand suppliers and tens of thousands of part numbers, he knew there were bound to be opportunities for savings and supply chain improvements-but where were they? And how should he start to find them? Parulekar formed an internal team to partner with a consulting firm to conduct a procurement diagnostic, which he hoped would justify investment in a transformational strategic sourcing initiative. The consultants produced a "spending cube" (included in the accompanying student spreadsheet) that covered every line item of every purchase order over the prior 11 quarters. As Parulekar perused the spending cube, he realized the team needed to prioritize a subset for the initial analysis. This case is taught at Darden in the second-year "Operations Strategy" course in a module covering strategic sourcing. It could also be used in a course with the focus or one on the broader topic of supply chain management.
This technical note offers an overview of artificial intelligence (AI) and some ways in which machine learning is leveraged to build this type of intelligence. The note also explores two schools of thought around AI's potential, discusses the possible roles for AI in business, highlights opportunities for collaboration between employees and AI, and considers one approach around responsible AI implementation. This note is taught at Darden in the second-year Digital Operations course. It would also be suitable in a module covering AI.
In January 2022, Shiftsmart cofounder and CEO Aakash Kumar wanted to capitalize on the company's momentum. Shiftsmart connected workers on a shift-by-shift basis to some of the world's largest corporations and government agencies. Fractionalizing traditional jobs into shifts was profoundly disrupting the idea of labor. At the time, the company operated in three verticals-Retail Insights, Flexible Contact Centers, and Convenience Retail. Kumar was considering whether to move up-market to professional services (such as tax preparation); attack the large, growing, and critical labor vertical (health care); or invest in fast-growing but highly competitive grocery delivery. The case provides students with the opportunity to examine platforms, analyze network effects, and evaluate the three expansion options Kumar was considering. It describes Shiftsmart's business model and its proprietary platform, which was the operational lifeblood of the company. This case is taught in Digital Operations, a second-year MBA elective course at the Darden School of Business. It could also be used in courses focused on digital operations or strategy and in those that consider how labor is changing.
Charu Thomas, cofounder and CEO of Ox, a software platform provider that helped retailers improve online order fulfillment, was proud of how her business had grown and earned positive feedback from investors, beta customers, and the press. Now, in the summer of 2021, revenue was on track to meet projections, and she began a comprehensive analysis of her costs, especially cloud hosting and computing costs. Ox's software was built and relied fully on cloud services, and Thomas had originally chosen a cloud provider based on capabilities and speed to build, not on cost. When she compared her costs to those of similarly sized start-ups, she realized Ox was paying 10 times what she expected to pay at scale. Fortunately, Thomas had recently welcomed Brent Sperry, who had worked on multiple cloud initiatives, as Ox's new chief operating officer. She shared her insights into the costs of cloud providers with Sperry and proposed the next project: benchmarking and reevaluating cloud costs for Ox. They aimed to better understand which activities were driving cloud-related costs, how prices compared across cloud providers for each activity, what operational constraints, if any, Ox currently faced, and the advantages of one provider over another. In the end, would they stick with the current cloud provider? What changes would they request on their current cloud bill? Would Ox benefit from a multi-cloud strategy? This field-based case, which is used in Darden's "Digital Operations" course, includes an overview of cloud computing's history and types; student and instructor spreadsheets with an interactive cost estimating model are also available.
In October 2021, Miles Arnone, CEO of Re:Build Manufacturing (Re:Build), was thinking about Re:Build's next acquisition. Arnone contemplated the pros and cons of each of three candidate companies as he prepared for a discussion with his colleagues. His associate had synthesized the results of a screening assessment for the three potential acquisitions, one element of Re:Build's acquisition decision-making process. Arnone and others had launched Re:Build in 2020 to help rejuvenate the US industrial base. The vision entailed acquiring and scaling manufacturing and engineering businesses into a tightly integrated portfolio to leverage technical capabilities across the enterprise. Adding a company to the Re:Build stable was no small decision, and getting it right would be another step forward in creating a "new" type of conglomerate-one where each company worked together to share technology, knowledge, and ideas. Which company (if any) offered the best fit with the overarching strategy? This partially disguised field-based case includes discussion of Re:Build's company structure, decision-making process, and acquisition criteria, as well as data about its current companies and the three under consideration for acquisition. This case is taught in "Operations Strategy," a Darden School of Business elective MBA course. It could also be used in other MBA courses and Executive Education programs that address entrepreneurship, private equity, and general strategy.
In fall 2021, start-up Rivian was poised to begin delivery of its first electrical vehicles (EVs) to external customers after several delays. The company had over 70,000 preorders for its R1T (pickup truck) and R1S (SUV) models. On November 11, the company went public, raising approximately $12 billion in the largest US IPO since Facebook. Early investors were bullish on Rivian. The company's success would depend in part on the availability of charging stations. Rivian had plans to establish two networks of chargers in the United States and Canada. Rivian Adventure Network would be a network of Level 3 DC fast chargers, while Rivian Waypoints would be Level 2 AC chargers. The company had announced that it wanted to establish these networks in locations near national parks and locales it expected its customers to visit. Rivian was targeting consumers who were outdoor enthusiasts. The case describes EV charging options and challenges students to determine where Rivian should locate its charging stations, how many were needed, and what types were best to serve consumers traveling the 469-mile Blue Ridge Parkway. Ultimately, this is not simply a problem seeking an "optimized solution" given predicted demand, but one that will fundamentally shape emerging consumer behavior. This case is taught in Operations Management, a required first-year course at Darden School of Business. It can also be used in a second-year elective course that explores the major issues and managerial concepts relating to strategic management of the operations function in today's global economy. The set includes a series of short video interviews with the case protagonist.