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Few companies IT-ready

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Dell EMC announced the results of a new study conducted by Enterprise Strategy Group (ESG), which revealed that a majority of senior IT leaders and decision-making managers of large companies surveyed around the world indicate their organisations have yet to fully embrace the aspects of IT Transformation needed to remain competitive.

While there is a clear imperative for companies to transform their legacy IT, digital transformation is becoming the driving force to making IT Transformation a top priority. However the ESG 2017 IT Transformation Maturity Curve study commissioned by Dell EMC shows 95 per cent of survey respondents indicate their organisations are at risk of falling behind a smaller group of industry peers that are transforming their IT infrastructures, processes and delivery methods to accelerate their goals of becoming digital businesses.

Many organisations still measure application cycle times in months, if not years; have siloed infrastructures; and continue to grapple with rigid legacy architectures – all barriers to undertaking a successful digital transformation.

“These findings mirror how the vast majority of customers are telling us they need to optimise their existing infrastructures to take advantage of digital-age opportunities,” said David Goulden, President of Dell EMC. “However, the research shows that most respondents are falling behind a small and elite set of competitors who have cracked the IT Transformation code, and they’re competing more vigorously because of it. As organisations progress in their IT Transformation investments, they can overcome the conflict between legacy IT and digital business initiatives to realise their goals, speed time to market and increase competitiveness.”

The ESG 2017 IT Transformation Maturity Curve study was designed to understand the role that IT Transformation plays toward becoming a digital business. ESG employed a research-based, data-driven maturity model to identify different stages of IT Transformation progress and determine the degree to which global organisations have achieved those different stages based on their responses to questions about their organisation’s on premise IT infrastructure, processes and organisational alignment.

Based on the global survey responses, the 1,000 participating organisations were segmented into the following four IT Transformation maturity stages:

·         Stage 1 – Legacy (12 per cent): Falls short on many – if not all – of the dimensions of IT Transformation in the ESG study

·         Stage 2 – Emerging (42 per cent): Showing progress in IT Transformation but having minimal deployment of modern data center technologies

·         Stage 3 – Evolving (41 per cent): Showing commitment to IT Transformation and having a moderate deployment of modern data center technologies and IT delivery methods

·         Stage 4 – Transformed (5 per cent): Furthest along in IT Transformation initiatives

The majority of respondents (71 per cent) agree that IT Transformation is essential to ongoing business competitiveness. Of the “Transformed” companies, 85 per cent believe their organisations are in a “very strong” or “strong” position to compete and succeed in their market over the next few years contrasted with 43 per cent of the least mature companies.

The “Transformed” organisations report the most progress in leveraging IT resources to speed product innovation and time to market; automating manual processes and tasks; and running IT as a profit center rather than a cost center. These companies:

·         (96 per cent) Exceeded revenue targets last year, more than two times the least mature

·         Are eight times more likely than the least mature organisations to report a highly cooperative relationship between IT and the business

·         Made “excellent progress” running IT as a profit center rather than a cost center (seven times more likely than the least mature)

·         Are seven times more likely than the least mature organisations to have IT viewed by the business as a competitive differentiator

·         Leverage IT resources to speed product innovation and time to market (six times more likely than the least mature organisations)

According to ESG, the adoption of modern data center technologies, such as scale-out storage systems and converged/hyper-converged infrastructure, can improve the agility and responsiveness of infrastructure provisioning, IT project delivery and application development. The study found:

·         54 per cent of all respondents use converged or hyper-converged infrastructure to support applications

·         58 per cent of all respondents have adopted scale-out storage systems in some capacity

·         Roughly 50 per cent of respondents are committed to software-defined as a long-term strategy and have begun to implement, evaluate or plan for software-defined technologies

According to ESG, the adoption of modern IT processes, – such as self-service provisioning capabilities, running IT like a public cloud and use of DevOps methodologies – can be an attribute of a successfully transformed company. The study found:

·         26 per cent of all respondents have “extensive” or “established” self-service capabilities

·         65 per cent of all respondents have made “excellent” or “acceptable” progress toward providing end users with the same ability to provision IT resources that they can get from a public cloud provider

·         43 per cent of respondents claim “extensive” or “good” adoption of formal DevOps principles and best practices

IT Transformation is often correlated with a more cooperative and effective relationship between IT and the business, which was validated by the research. The study found:

·         36 per cent of IT organisations and their outcomes are evaluated by the C-suite or board of directors monthly, and 38 per cent are evaluated quarterly

·         39 per cent have the most senior IT executive reporting directly to the CEO

·         61 per cent of the least mature organisations indicate their line of business stakeholders view IT as a “stable service provider, but ultimately a cost center”

At Dell EMC World in May 2017, experts will explore IT Transformation and how it enables organisations to achieve their digital transformation goals.

Supporting Quotes:

John McKnight, Vice President of Research and Analyst Services, Enterprise Strategy Group

“Companies today increasingly rely on technology to grow and improve all aspects of their business. However, ESG’s research found that fully ‘Transformed’ IT organisations are admittedly rare at this time. The good news is that there are incremental benefits to be had by making any progress along the maturity curve, which can be achieved by emulating the behaviours of these ‘Transformed’ organisations.”

Adam DeMattia, Director of Research, Enterprise Strategy Group

“Legacy IT is largely unprepared to meet the requirements of the new digital business: application cycle times measured in months, if not years; siloed infrastructure that prohibits organisations from viewing their data holistically; performance bottlenecks that impact end-user experience in a world that demands constant availability and response times; rigid architectures that force organisations to make forklift upgrades as requirements change; and traditional provisioning processes in which IT is often seen as a barrier rather than an enabler for the business. Organisations must resolve this conflict between Digital Transformation goals and today’s IT reality if the business is to meet its ultimate objectives.”

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Crouching Yeti strikes

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Kaspersky Lab has uncovered infrastructure used by the Russian-speaking APT group Crouching Yeti, also known as Energetic Bear, which includes compromised servers across the world.

According to the research, numerous servers in different countries were hit since 2016, sometimes in order to gain access to other resources. Others, including those hosting Russian websites, were used as watering holes.

Crouching Yeti is a Russian-speaking advanced persistent threat (APT) group that Kaspersky Lab has been tracking since 2010. It is best known for targeting industrial sectors around the world, with a primary focus on energy facilities, for the main purpose of stealing valuable data from victim systems. One of the techniques the group has been widely using is through watering hole attacks: the attackers injected websites with a link redirecting visitors to a malicious server.

Recently Kaspersky Lab has discovered a number of servers, compromised by the group, belonging to different organisations based in Russia, the U.S., Turkey and European countries, and not limited to industrial companies. According to researchers, they were hit in 2016 and 2017 with different purposes. Thus, besides watering hole, in some cases they were used as intermediaries to conduct attacks on other resources.

In the process of analysing infected servers, researchers identified numerous websites and servers used by organisations in Russia, U.S., Europe, Asia and Latin America that the attackers had scanned with various tools, possibly to find a server that could be used to establish a foothold for hosting the attackers’ tools and to subsequently develop an attack. Some of the sites scanned may have been of interest to the attackers as candidates for waterhole. The range of websites and servers that captured the attention of the intruders is extensive. Kaspersky Lab researchers found that the attackers had scanned numerous websites of different types, including online stores and services, public organisations, NGOs, manufacturing, etc.

Also, experts found that the group used publicly available malicious tools, designed for analyzing servers, and for seeking out and collecting information. In addition, a modified sshd file with a preinstalled backdoor was discovered. This was used to replace the original file and could be authorised with a ‘master password’.

“Crouching Yeti is a notorious Russian-speaking group that has been active for many years and is still successfully targeting industrial organisations through watering hole attacks, among other techniques. Our findings show that the group compromised servers not only for establishing watering holes, but also for further scanning, and they actively used open-sourced tools that made it much harder to identify them afterwards,” said Vladimir Dashchenko, Head of Vulnerability Research Group at Kaspersky Lab ICS CERT.

“The group’s activities, such as initial data collection, the theft of authentication data, and the scanning of resources, are used to launch further attacks. The diversity of infected servers and scanned resources suggests the group may operate in the interests of the third parties,” he added.

Kaspersky Lab recommends that organisations implement a comprehensive framework against advanced threats comprising of dedicated security solutions for targeted attack detection and incident response, along with expert services and threat intelligence. As a part of Kaspersky Threat Management and Defense, our anti-targeted attack platform detects an attack at early stages by analysing suspicious network activity, while Kaspersky EDR brings improved endpoint visibility, investigation capabilities and response automation. These are enhanced with global threat intelligence and Kaspersky Lab’s expert services with specialisation in threat hunting and incident response.

More details on this recent Crouching Yeti activity can be found on the Kaspersky Lab ICS CERT website.

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R5m in software fines

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South African companies paid almost R5.2 million in damages for using unlicensed software in 2017 up from R3.6 million in 2016.

This is according to data from BSA | The Software Alliance, a non-profit, global trade association created to advance the goals of the software industry and its hardware partners.

The significant increase in unlicensed software payments – which includes settlements as well as the cost of acquiring new software to become compliant – is the result of more accurate leads from informers, says Darren Olivier, Partner at Adams & Adams, legal counsel for BSA. In 2017 BSA received 281 reports in South Africa alleging the use of unlicensed software products of BSA member companies – this up considerably up from 230 leads in 2016.

“BSA’s recent social media campaign also helped to create awareness among local companies about the need to comply with existing legislation in order to avoid legal action,” Olivier says.

The result has been a 13% increase in settlements paid in 2017, with the settlements total reaching almost R2.5 million.

While the average settlement paid by companies in 2017 was around R36 094, in some cases the amount owed was far greater, as is evidenced by Shereno Printers, a print and design company based in Gauteng, which ended up paying a hefty settlement amount of R260 000 last year in an out of court settlement.

The company’s case was in line with a broader trend, which saw the print and design industry as a whole rank among the top sectors plagued by unlicensed software.

Aside from settlements, companies also paid more than R2.6 million in licenses purchased to legalise their unlicensed software.

And the ramifications of software piracy extend beyond financial implications. “It also results in potential job losses and loss in tax revenue. This is not to mention the financial and reputational damage brought about by security breaches and lost data,” comments Olivier.

As unlicensed software has not been updated with the latest security features, it leaves businesses vulnerable to cyberattack, he explains.

This is a particular problem for companies operating in South Africa where economic crime has recently reached record levels, according to the Global Economic Crime Survey. Indeed, 77% of South African organisations have experienced some form of economic crime. What’s more, instances of cybercrime totalled 29% of economic crimes reported.

This in turn, raises questions around government policy and the adequacy of existing copyright legislation, which only enables the registration of copyright in films, but not in computer programs.

Olivier notes that it is likely the percentage of unlicensed software on South African computers has increased over the past year. “We received many more leads this year, which is an indicator that the amount of pirated software is greater than in previous years,” he comments.

Often unlicensed software is not so much a case of deliberate piracy as it is a result of poor software asset management (SAM).

“For this reason, the BSA encourages all businesses to ensure they have effective SAM practices in place. Companies should be able to confirm what software they are using and are licensed to use – this will help them to identify unlicensed software and can also bring about cost savings. Even the most basic SAM practices such as regular inventories and software use policies can help,” says Chair of the BSA SA Committee, Billa Coetsee.

With this in mind the BSA offers a range of SAM solutions, not only to help organisations reduce legal and security risks, but also to create business value.

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