Latest industry report from The Raconteur (as distributed in The Times newspaper) and sponsored by Digital Realty. Excellent insight into the technology, business and financial impacts of the Cloud.
3. CLOUD FOR BUSINESS
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FINANCE
ȖȖ With internet-connected PC
andmobiledevicesrunningcloud-
based consumer software and
services, such as e-mail and social
networks,itiseasytoseewhycom-
pany finance departments want to
capitalise on the same cost-sav-
ings,accessibilityandconvenience
afforded their staff at home.
However, this vital line of busi-
ness has been comparatively slow
to realise the benefits of cloud
computing,comparedforexample
to its sales, marketing or human
resourcescounterparts,withtheir
highlydistributedandincreasingly
mobileworkforces.Aglobalsurvey
of 2,041 business executives, com-
missioned by Microsoft and con-
ducted by 451 Research, confirms
that 32 per cent of organisations
now include a formal cloud com-
puting plan as part of their overall
IT and business strategy.
A financial services sector study
published by Oracle, Accenture
and Longitude Research also
reveals 68 per cent of 1,275 execu-
tives are either planning to use a
cloud-based financial accounting
systemorarealreadydoingso.But
they are only likely to subscribe
or apply cloud-based software or
services in selective situations.
“Cloud is the single most dis-
ruptive force in technology,” says
Steve Cardell, president of enter-
prise services and diversified
industries at HCL Technologies,
who runs the IT software and
services provider’s enterprise
applicationsoftwarepractice.“But
I would also say that finance has
beenatthebackofthebus.Andfor
goodreason–theyhavealotmore
legal and regulatory compliance
considerations than some other
parts of a business.”
This cautious attitude is slowly
beginning to change in response
toemergingchallenges.Speed
of deployment and lower
capital costs, for example,
are often the primary rea-
son a finance department begins
to evaluate what the cloud can
offer. Hosted IT infrastructure
services, for instance, are help-
ing finance departments manage
seasonal peaks in demand for
computing power.
“Budgeting and planning often
need a huge amount of IT capac-
ity,” says Mr Cardell. “In some
cases, the month-end processes
can cause IT-based systems to
COUNTINGTHECOST
OFBEINGCLOUDLESS
Finance departments are playing catch-up in
switching to cloud-based accounting systems,
as Miya Knights discovers
Machines
inthecloud
Page06
grind to a halt. So most build for
the peak and don’t use that spare
capacity the rest of the time or
struggle to meet demand during
peakperiods.”Wheredatagovern-
ance and security is often written
into service contracts, he adds,
“cloud infrastructure can be most
helpful for cost-effective opera-
tional speed and agility”.
The finance department also has
a range of options when it comes
to cloud-based software, includ-
ing those developed for time and
expense reporting, for example.
“I call these input applications,”
says Mr Cardell. “They
are usually the
first area
of cloud-based finance software
adoption.” Used by management
and staff to provide finance with
vitaloperationsdata,theseapplica-
tions, which can often be accessed
through a browser or mobile
device, can streamline the gather-
ing and dissemination of account-
inginformationinreal-time.
Mr Cardell highlights the core
finance function itself as the place
where cloud adoption has so far
failed to keep pace with the rest of
the business. “These applications
tendtobehighlytransactionaland
are therefore more liable to risk
and regulation, such as payroll or
statutory financial accounting
packages,” he says.
This is because enter-
prise resource plan-
ning(ERP)software
has historically
required signif-
icant invest-
ment and
in-house
manage-
ment
where
“there are
just not as
many cloud prod-
ucts on the market,” Mr Cardell
says. Major vendors, such as
Oracle and SAP, have introduced
large enterprise cloud-based
ERP offerings. But cloud-based
vendors, including NetSuite and
Salesforce, are also mak-
ing headway in the mid-
market.
The finance department
of Broadway Malyan
made the move to cloud-
based accounting soft-
ware early. Anne Howard,
head of UK finance for
the international archi-
tecture practice, says it
has enabled more effec-
tive resource planning,
as well as cost-savings
and improved productivity.
“The business had already made a
move into cloud with Google Apps
a couple of years ago,” Ms Howard
says. “So we were open to cloud
solutions where finding a fit with
ourglobalbusinessmadecost,flex-
ibility and scalability paramount.
It means we have no hardware
costs and that the software is
constantly upgraded. And we can
expand access to the systems to
ourpeopleanywhereintheworld.”
She adds that, although security
is a major consideration, cloud
providers’ systems are often more
securethanbusinesseswhosecore
purpose is not IT related.
Broadway Malyan migrated to
Twinfield, integrating the provid-
er’s online, cloud-based account-
ing suite with the company’s
existing customer relationship
management system in 2012. Ms
Howardsaysthecompanyworked
with Twinfield to develop some
specific local functionality, which
included handling BACS (Bank-
ers’ Automated Clearing Services)
and cheque payments. But this
was preferable to buying a larger
enterprise package with “more
functionality than we needed”,
she says.
“It’s just been so easy. We have
better visibility of what’s happen-
ing internationally, where before
that would only happen when we
physically visited each office to do
an audit. And we can now spend
the time saved on value-added
areas rather than churning out
the accounts.” This includes more
business-facing analysis of opera-
tions, to reveal the least and most
efficient projects or most valuable
clients, for example. “And we can
run reports knowing the data is
automaticallyrefreshed,”sheadds.
MsHowardagreeswithMrCard-
ellthatthemainopportunitycloud
now offers is around reporting
and analytics. “Different business
functions can pull external data
sourcesandunstructureddatainto
cloud-based analytic platforms or
tools,” he says.
“You can run finance data
through Power BI, for example, to
produce tables and integrate this
dynamically with a presentation,
so that the content of the slides
changes whenever the underlying
data changes.” With benefits like
these, it is easy to see why 47 per
cent of organisations, surveyed
by researchers at Gartner, plan to
move their core ERP systems to
the cloud within five years.
Problemsfloatawayinthecloud
Theadvantagesofworkinginthecloudarejust
toogreattoignore,says Big Red Cloud
sion2.0andnewlicencesareneeded,
you’llbeopeningyourwalletyetagain.
The cloud does away with all of that.
A user can log-on via a web browser
to have full and immediate access
to the very latest version of their
accounts software. It doesn’t matter
which computer they use. It could be
via a tablet. It could be on a PC in an
internetcaféatNaritaairport,Japan.
The cloud application provider
takes charge of all hardware
requirements so there are no serv-
ers to buy and no visits from the man
with the drill. The cloud provider
handles and pays for all the ongoing
nitty-gritty, such as upgrades, anti-
virus and back-up. Costs associated
with these activities simply evapo-
rate. Oh, and no electricity bill spikes
either – not your problem anymore
asyouaren’trunningadatacentre.
By moving to the cloud you’ll be
benefiting from your partner’s
technical expertise. They will have
a large cohort of dedicated techni-
cal staff, way in excess of what an
individual firm could justify sus-
taining. And cloud providers have
access to lavish resources, such
as Microsoft Azure’s platform. This
is Microsoft’s datacentre offering,
which leases mass-scale technical
infrastructure to cloud hosts.
Marc O’Dwyer, chief executive of
BigRedCloud,whichbasesitscloud
accounting service on Azure, says:
“Microsoft has thrown millions at
Azure. It offers incredible resilience,
back-up and cost advantages. The
power of Azure is now available at
thefingertipsofsmallbusinesses.”
Shouldyouraccountsbeinthecloud?
At first glance this might seem unim-
portant. What does it matter? Can’t
the IT guys decide the technical stuff
like this? Well, yes, they can. But
the question of where to host your
accountingsoftwareiscritical.
Inadditiontothecostconsiderations,
there is a long list of operational ben-
efits to the cloud. When you start to
graspthedifferencesbetweentheold-
fashionedapproachofbuyingsoftware
and installing it on your own equip-
ment stored in your office, and the
cloudapproachwherebyallyouneedis
access to the internet, the advantages
oughttogetyouprettyexcited.
Let’s start with something basic,
like capital expenditure. The old way
of using software was to do every-
thing in-house. This required firms
to splash out on servers to run soft-
ware.Thebillsquicklyaddedup.
The software costs money. And
you’ve got to fork out for an IT guy
to install the software. He’ll need to
maintainittoo.Upgradesandpatches
must be applied. The data must be
backed-up, which costs money. You’ll
need to make sure your anti-virus
systemisuptothejob.
The expenditure doesn’t end there, as
there are hidden nasties, like the cost
of ethernet cabling, electricity bills
andforkingoutforatechniciantodrill
holes in your walls to accommodate
your bulky kit. And there is possible
downtimeduringupgrades.Butwhen
the software maker launches ver-
This means even the smallest
firm can have the same technol-
ogy at its disposal as the very larg-
est. The cloud will change the way
your firm works, for the better.
There are game-changers. For
example, accountants can use the
cloud platform to access data in
real-time.
Mr O’Dwyer explains: “If you are
not in the cloud there is a time-delay.
Firms need to download their data
to a file and then send that to the
accountant. This is not a responsive
way to work. But with the cloud, the
accountant can look at the financial
information at any time of day and
always get the very latest picture.
This means the accountant can take
amoreactiverole.
“They can use our business intelli-
gencetoolstogiveadvancedinforma-
tionondebtorsdays[howquicklycash
is being collected from debtors] or to
warnexecutivesthatcashcollectionis
behind schedule and action needs to
be taken. It changes the relationship
between accountants, book-keepers
and their clients. It is for this reason
we offer free access to accountants
andbook-keepers.”
The same is true for business-own-
ers as real-time information gives
more accurate insight into the busi-
ness, allowing for faster and more
insightfuldecision-making.
There are additional improve-
ments, such as the ability to hot-
desk in the office. Workers can use
any machine to access accounts.
Perhaps you are stuck at home
with the kids or need to address an
urgent issue when on holiday. With-
out the cloud, you are reduced to
using some sort of “remote login”
third-party application or must
wait for someone to download and
e-mail you the files you need, which
may be out of date by the time you
get them. With the cloud you have
instant access to everything.
And the old system meant invoices
couldn’tbeprocesseduntiltheaccount-
antshaddonetheirwork.Withthecloud
thereisnodelay.Ifnecessary,therecan
be an ongoing conversation between
multiple parties, all viewing the same
accountsfrommultiplelocations.
For fast-growing firms the cloud
offers seamless – and limitless –
expansion possibilities. You simply
aren’t going to hit a point where your
ITguyshakeshisheadandsays,“The
server is full”. In the cloud, it is com-
pletelyscalableandsimpletoaddten,
a hundred or a thousand new staff to
an application. With Big Red Cloud
an unlimited number of users are
allowed,fornoextrafee.
Maybe though the biggest pay-off is
mind-space. Business-owners need
to focus on their core activities. They
should not spend valuable time trying
toboneuponhowadatacentreshould
berunorwhethertheirsoftwareisup
todate.Thecloudmeansyoucanforget
aboutreamsofnigglingissuesforever.
Pick the right cloud partner and
you can take your business to new
heights. Big Red Cloud founder Mr
O’Dwyer says: “Big Red Cloud is
simple to implement, works from
the get-go and comes with full tel-
ephone support. We’re here to help
smart modern enterprises make
better business decisions and set
thefoundationforfuturegrowth.”
Clarity of mind, lower costs, maxi-
mum up-time, automated back-ups,
anywhere-access, easy expansion,
improved management control and
greater security all come as standard
in the cloud. It is pretty much impos-
sible to achieve anything similar in-
house. That is why there is so much
excitement about the cloud. You’d be
crazynottotakeadvantage.
Formoreinformation,pleasecontact
MarcO'Dwyer
Tel:01619268822
Web:bigredcloud.co.uk
E-mail:info@bigredcloud.com
Thecloudmeansyoucanforget
aboutreamsofniggling
issuesforever
THECLOUDAPPLICATION
ON-PREMISE
Largeup-frontcapital
infrastructureandinstallation
costs.Extrairregularpayments
Generallyonelicenceper
computerwithdatadownloads
andmanuallydistributedfiles
E-mail or physical back-up
data exchange with risk of
being out of synch
Server, hardware and
infrastructure required
Manual, potential downtime
and extra licence costs
Often pay for
separate licences
In-house reliability,
storage and back-
up issues
Extralicencesneeded
Nocapitalexpendituretoget
upandrunning.Regularand
predictablepayments
Real-timeinformationanywhere,
anytimewithinternetconnection
Real-time updating of a
single data set by client
and accountant
No limits. Accommodates
increasing volumes of data
Automatic, with every user
on the same version
Included in
subscription cost
Major industry specialist
delivers the required and
secure computing power
Potentiallyunlimited
FINANCIAL
USERS
BUSINESS
ACCESS
ACCOUNTANT'S
ACCESS
SCALABILITY
UPGRADES
TECHNICAL
SUPPORT
PLATFORM
SaaS CLOUD MODEL
COMPAREIN-HOUSEANDTHECLOUD
UPDATE
RECORDS
REAL-TIMECOLLABORATION
ACCOUNTANT BUSINESSOWNER
SIMPLEAND
INTUITIVEINTERFACE
SIMPLEAND
INTUITIVEINTERFACE
4. CLOUD FOR BUSINESS CLOUD FOR BUSINESS
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INTERNETOFTHINGS
ȖȖ Understanding the societal
impact of computing and test-
ing the possibilities of machines
withhuman-likeintelligencehave
always been passions of Sir Nigel
Shadbolt. Yet he recognises the
threats concomitant with trusting
toomuchincode,eveniftheyseem
like science fiction to some.
It’s only been 12 months since
Sir Nigel was knighted for his ser-
vices to science and engineering,
but his work stretches back 30
years. Over that time, through his
psychology and computer science
research, he’s seen the inexorable
spread of the internet as a force
for change and is now keeping
a watchful eye on the so-called
internet of things.
This will see the spread of con-
nected,automateddevices,largely
operating on their own, suppos-
edly for the benefit of the general
public. They will be powered
by cloud-based systems, again
consisting of collections of highly-
automated machines, spread
across global data centres, with
the ability to deal with massive
fluxes of traffic – something the
growing pool of connected things
isexpectedtodeliver.Fortheaver-
age home-user, this means being
able to let computers decide how
best to manage their energy use to
save money or having their fridge
send alerts when groceries have
reached their use-by date.
But Sir Nigel believes the most
successful internet of things pro-
jectswillinitiallybenefittheemer-
gencyservicesandurbanplanning
groups,astheycantakeadvantage
of open data streams. He has been
impressed by one initiative using
avarietyofinformationsourcesto
placeambulancesasclosetolikely
incidents as possible and expects
cities to get greener with more
efficient energy usage thanks to
automated controls.
In a bid to further the benefits
of the web for the common man,
Sir Nigel and his team at the Uni-
versity of Southampton, where
he is a professor of artificial intel-
ligence (AI) and head of the Web
and Internet Science Group, are
working on the study and practice
of social machines (SOCIAM).
The project will determine how
to develop distributed, crowd-
powered systems that have the
potential for profound impact on
individuals, businesses and gov-
ernments. “We want to make that
a routine way in which business is
done,” he says.
He also founded the Open Data
Institute (ODI) with the forefa-
ther of the world wide web, Sir
Tim Berners-Lee. The purpose of
the ODI is to encourage govern-
ment and businesses to open up
sourcesofdataforthepublicgood.
Yet Sir Nigel believes this idea of
openness needs promoting across
other areas to ensure the inter-
net continues to bring benefits
to a wide audience, whether via
web browsers, the cloud or con-
nected “things”.
Inparticular,ina“post-Snowden
world” and one in which a handful
of companies have massive power
over the way the web works, he
worries about excessive control
over the internet. He frets about
“intrusive and exclusive control
by any agency”, whether a state
agency, such as the US National
Security Agency, or an organisa-
tion on the scale of Facebook and
Google. Despite the intrusions on
privacysuchentitieshavebrought,
Sir Nigel is still hopeful. “The
thing that depresses me is when
people just sit on their hands and
say privacy is dead, get over it. It’s
entirely in the hands of our soci-
ety,” he says.
His answer is to build account-
ability into the internet, by having
tracking working for the average
user, rather than against them.
“We’vegotmorecomputingpower
than ever; some of it should be
devotedtothisissueoftrackingfor
ourbenefit,”headds.“Thewayyou
can do that is doing what’s called
‘accountable computing’, where
there’s a trace associated with the
flowofdatainthesesystemsabout
whereit’sbeen,whohashadaccess
to it.”
Those building the architecture
of the internet also need to be
wary of granting machines too
much decision-making power
through AI. “You have to keep
asking yourself, if we keep grant-
ing autonomy to these systems to
takedecisionsonourbehalf,dowe
understand the full range of their
responsesandtheside-effectsthat
might have?
“Fundamentallywehavetoaskat
everypointwherewe’redelegating
decision-making authority, do we
know how to take it back and do
we understand the limits of that
authority? That’s really crucial,”
he says.
While cloud systems have seen
failures, for example when Goog-
le’s Gmail goes down or Amazon
Web Services hosting collapses
causing websites to go dark, they
stillworkmostofthetime.Aslong
asmachinesarecodedresponsibly,
these systems will continue to
operate adequately, says Sir Nigel,
and the same goes for other, more
contentious technologies, such
as weaponised military drones.
“You have to put those rules of
subservienceintothefundamental
software systems,” he says.
Sometimes the code giving
machines their instructions does
get out of control, so much so that
humans cease to understand how
they work. “We’ve got this very
interestingareaofAIcalledgenetic
algorithms where you essentially
evolve programs,” Sir Nigel says.
“Those programs can do things
that you stare at as a designer for
hours and hours to work out how
it’s doing what it’s doing.
“There’s a very good example
in electronic design where they
had a program to design oscil-
lators and amplifiers, simple
electronic circuits. They found
some of these designs that the
genetic algorithms had evolved
and nobody could make any sense
outofthem.Thesystemhadlearnt
totakeadvantageofreallypeculiar
impurities and facets of the hard-
ware and the materials that you
wouldneverdesignforasahuman
designer. It’s fascinating, but it’s
kind of spooky.”
Yet fears of the fictional Skynet,
of a world in which machines
have taken over, are far-fetched.
It should be remembered humans
oftenmakefatalmistakes.Inmany
cases, we should trust machines
more than an individual with free
will and capacity for error, Sir
Nigel says.
He concludes: “What we do
know is that, in lots of routine
kinds of automation, the error
rates are much less than when
you’vegothumanoperatorsthere.
That’s just a sad fact. People make
mistakes more often than our
machines do.”
Fundamentallywehavetoaskat
everypointwherewe’redelegating
decision-makingauthority
Smartmachinescan
savetimeandmoneyin
thecloud
PLACINGOURTRUST
INTHEMACHINES
A fridge that knows the use-by date of food and appliances
which switch off to economise on electricity are just the start of
an internet-like network of machines increasingly entrusted to
make our decisions, writes Tom Brewster
Brightenup
business
Page12
ȖȖ Examples of national and
regional efforts to embrace the
cloud can be found in the United
States, Europe, Japan, China,
Singapore, Taiwan, Thailand and
many other countries and regions.
In the private sector, adoption of
cloud services is growing within
thebankingindustry,manufactur-
ing, healthcare and in many other
largecorporations,aswellassmall
and medium-sized businesses.
Despitethesimplicityoftheidea
of information and communica-
tions technology services offered
as a utility, on demand and pay-
as-you-go, the cloud computing
modelisbasedonacomplexchain
of interactions between multiple
parties, which operate in different
countries and cross jurisdictions.
The complexity and opacity that
sometimes characterise the cloud
“supply chain” have generated
somebarrierstofasteradoptionof
cloud computing, including:
• Lackofclarityaroundthedefini-
tionandattributionofresponsi-
bilities and liabilities
• Difficultiesachievingaccountabil-
ityacrossthecloudsupplychain
• Incoherent global, and some-
timesregionalandnational,legal
frameworkandcompliance Wre-
gimes
• Lack of transparency of some
service providers or brokers,
particularlyaroundsecurityand
risk management
• Difficulties in performing inter-
nal and external due diligence
• Lack of clarity in service level
agreements (SLAs)
• Lack of interoperability
• Lackofawarenessandexpertise.
A key underlying theme in all
theseistheneedforassuranceand
trustbetweencloudprovidersand
customers, and generally within
the overall ecosystem.
Barriers can be removed. Gov-
ernments, cloud service providers
and customers should be working
collaborativelytowardsincreasing
the level of trust in the market.
Tothisend,thedefinitionofsecu-
ritycontrolandcertificationframe-
works, SLAs, standardised contrac-
tualterms,andtheuseofcontinuous
monitoringarekeymeanstoprovide
moretransparencyandgovernance
tothecloudcustomer.
The European Commission strat-
egyforcloudcomputing,forinstance,
isbasedonthreemainpillars:
1. Identification of suitable stand-
ards and certification schemes
2. Definition of model terms
for SLAs, and contractual terms
and conditions
3. Definition of common
requirements in public sector
organisations, and use of public
procurementasamarketandqual-
ity stimulus.
Similarapproachesarecurrently
being adopted in the US and Asia-
Pacificregion.Cloudprovidersare
strivingtobecomemoretranspar-
ent, especially when it comes to
security and privacy.
Cloud Security Alliance (CSA)
STAR, a voluntary registry where
cloud providers can publish the
results of their security assess-
ment – either self-assessment
or third-party audit-based cer-
tification – against the CSA best
practices, namely Cloud Control
Matrix, is a clear example of cloud
providers’ willingness to maintain
the trusted relationship they have
with existing customers and to
provide assurance to potential
new ones that their service will
be sufficiently secure. Assurance
is provided by telling customers
whicharethesecuritycontrolsand
measures in place to manage risks
to their infrastructures, services
and data.
The objective is to put the cus-
tomer in a position to compare
competing offerings against their
requirements, to make informed
decisions when choosing the ser-
vicetheyneedandtobeableverify,
duringtheservicedeliveryphase,if
realitymatcheswhatwaspromised.
These are certainly steps in the
right direction and point to the
creationofamarketwheresecurity
is a market differentiator, where
transparency is the general rule
andobscuritytheexception.Cloud
solution providers have business
incentives to be transparent, to
shareinformationwithregulators,
enforcementauthorities,aswellas
current and potential users, about
their security practices.
The most obvious business
incentive is based on the simple
logic that the customer is more
likely to buy services only from
those providers which provide
enough information to effectively
managetheirrisks.Inthisrespect,
the example of an incident man-
agement process is very illustra-
tive; in fact a cloud customer
necessarily needs information
and co-operation from the cloud
provider to be able to manage an
incident properly.
Policy-makers are playing their
part by introducing a number of
“soft” policy measures, as well as
newbindingrulesontransparency
and accountability. We have also
seen a more proactive approach of
somecloudsolutionproviderswho
are voluntarily sharing relevant
information with the general pub-
lic. What is still missing, perhaps
surprisingly, is a more active role
of cloud service customers.
Cloud Security Alliance is a
not-for-profit organisation focus-
ing on best practices, standards,
research-provider certification
and education in cloud computing
security. CSA’s activities include
the Open Certification Frame-
work/STAR Certification, aware-
ness and educational campaigns,
conferences, seminars, summer
schools, webinars, educational
papers, guidelines for companies
and government, and finally train-
ing and professional certification
through the CCSK (Certificate of
CloudSecurityKnowledge).
TRANSPARENCYAND
ASSURANCEFOR
ATRUSTEDCLOUD
Shareanddiscussonlineatraconteur.net
OPINION
Cloudcomputingisbecomingamaturebusinessmodel,
andmanycompaniesandgovernmentsaroundtheglobe
areimplementingstrategiestoembracecloudservices,says
DanieleCatteddu,managingdirector,Europe,theMiddle
EastandAfrica,atCloudSecurityAlliance
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CLOUD FOR BUSINESS
CLOUD FOR BUSINESS
ȖȖ WhentwoHelpforHeroesweb-
sites crashed under the weight
of traffic following the murder of
soldier Lee Rigby in the streets of
London, the charity turned to the
cloud to make sure it did not hap-
pen again.
“Before that I was a bit of a
sceptic about the cloud,” admits
Charles Bikhazi, head of IT devel-
opment at Help for Heroes. “But
the move was forced upon us by
events – we needed to be able to
handle these spikes in demand.”
As cloud services move into the
mainstream, companies ranging
from the giant Coca-Cola down to
the small, corner restaurant are
looking to the web to deliver their
information and communica-
tions technology (ICT). Although
most avoid Help for Heroes’ crash
course in technology, many strug-
gle to make informed decisions
about the cloud.
Marketing hype and the absence
of reliable, independent analysis
make it difficult for hard-pressed
managers to understand an eco-
system in which nearly every
ICT function from servers and
storage to application software
and telecommunications has its
cloud equivalent.
Underlying the services is a bit-
ter commercial struggle involving
suppliers that only operate in the
cloud and established firms jug-
gling their cloud offerings with
older products developed for use
“on-premise”.
The competition has led to
keenerpricesforsomecloudprod-
ucts, although comparing services
iscomplicatedbythelargenumber
ofsuppliersandthemanydifferent
ways they have of presenting and
charging for their wares.
For example, providers are not
abovemakingcloudbuyerspayfor
resources that they do not need.
Organisationsmaybeaskedtobuy
extra disc storage and processor
power in order to get the amount
of main memory they require.
“Many of these problems stem
from[services]thatweredesigned
aroundlegacyarchitectures,which
is why we see such dramatic per-
formance and cost differences
among providers,” claims a study,
from cloud company Profitbricks,
called The Secret World of Cloud
Integration-as-a -Service Pricing.
The industry has created an
alphabetsoupofjargontodescribe
its technology. At the top floats
Software-as-a-Service (SaaS), the
longest established cloud service.
In SaaS, software solutions and
associated data are held centrally
by one or more suppliers and can
be accessed by their customers
throughanyPCwithawebbrowser.
Common business applications
– e-mail, human resources man-
agement, customer relationship
managementandaccounting–are
available as a service from well-
known names such as Salesforce,
Microsoft and Google. Instead
of laying out for a single licence,
customers pay monthly for each
user, sometimes according to how
muchtimeusersactuallyspendon
the service.
AlthoughSaaSisthelargestmar-
ketforcloudcomputingatpresent,
in the longer term Platform-as-a-
Service(PaaS)islikelytobeamore
important sector.
PaaS is aimed at business man-
agers who want to develop and
adapt their own applications.
Suppliers provide both the hard-
ware and operating systems for
running applications, and the
tools for developing them. The
tools are usually presented as an
application stack.
ECOSYSTEM
Howthecloudworksandinteractswith
othertechnologyasanIT“community”can
beconfusing,unlessyoureadJohnLamb’s
jargonbuster
UNDERSTAND
THECLOUD
ECOSYSTEM
LOOKINGBEHINDTHECLOUD
Theindustryhascreatedan
alphabetsoupofjargonto
describeitstechnology
TheadvantageofPaaSisitmakes
itmucheasiertodevelopnewbusi-
ness processes without involving
IT experts. Off-the-shelf services
enable managers to develop and
adapt business applications with-
out incurring high costs and long
lead times.
The business of loading up a
server with systems, data and
software, known as provisioning,
is faster in the cloud. End-users
areabletoselectandremovecloud
services by themselves. Indeed,
many services include software
that adds additional resources
automatically.
Infrastructure-as-a-Service
(IaaS) is the third main category
of cloud service. It is aimed at
organisations that want to reduce
the amount of money they spend
on buying,hostingandsupporting
their computer servers.
IaaS providers offer comput-
ing power on a rental model
that IT departments can access
instead of buying their own serv-
ers and running the risk of having
too much or too little capac-
ity. Organisations access virtual
machinescreatedwithinsuppliers’
datacentres.
A price war has already broken
outbetweenmajorplayers,suchas
Amazon Web Services, Microsoft
Azure and Google Cloud. In April,
Microsoft cut the price of renting
virtualmachinesbyuptoathirdin
order to match earlier reductions
by Amazon. Not to be outdone,
Google has followed suit.
Recent tests of the performance
of virtual servers on Amazon EC2,
Google Compute Engine, and
Microsoft Windows Azure, carried
out by InfoWorld magazine, put
Googleaheadintermsofspeedand
cost, closely followed by Azure. But
thatpeckingorderislikelytochange
asthesuppliersjockeyforposition.
Amazon and Google’s public
cloud services have grown out
of the huge server capacity the
companies built up to run their
own businesses. Microsoft on the
other hand is a relative newcomer
and has adopted a hybrid strategy
with Azure mixing private and
public cloud.
There are growing pains. Some
service providers suffered outages
lastyear,butthatseemsunlikelyto
dent the growth of a business that
now sees Amazon installing more
server capacity each day than its
entire business required to run a
decade ago.
Few organisations of any size
have moved their ICT entirely to
the cloud; most manage a mixture
of existing software and hardware
on their premises together with
new cloud services.
They must also choose between
buying public cloud services that
are shared with other users and
building their own private cloud.
Many users opt for a hybrid
approach, running a mixture of
public and private cloud services.
For example, Help for Heroes is
keepingitsall-importantdatabase
ofdonorsin-houseforthemoment
and relies on its cloud supplier
Rackspace to provide additional
computing power when needed.
However, in future Mr Bikhazi
is looking to expand Help for
Heroes’ use of the cloud. Projects
include introducing cloud-based
customer relationship manage-
ment and adopting Microsoft’s
Azure, which provides both IaaS
and PaaS resources.
Help for Heroes will also take
advantage of the free access to
Office365,theSaaS thatMicrosoft
offers to not-for-profit organisa-
tionstorune-mailandPowerPoint
applications online.
Managing a transition like this
can be tricky. “Businesses can find
themselvescobblingtogetherend-
to-end processes as a result,” says
Jez Back, cloud expert at manage-
ment consultancy Deloitte UK.
Recently, cloud brokers have set
upshoptoaidtheprocess.Brokers
combine technology, consulting
and buying power. They act as
middlemen between business
users and cloud suppliers, putting
together packages of services.
Securityremainsoneofthehottest
issuesforcloudusers.NationalSecu-
rity Agency whistleblower Edward
Snowden’s revelations about the
extent of covert data gathering
by security services in the United
StatesandtheUKhaveundoubtedly
affected corporate attitudes to the
securityofcloudcomputing.
Around two thirds of organisa-
tions not currently using cloud
feel the revelations have pre-
vented them from moving their
ICT into the cloud, according to
the NSA After-shocks survey by
the Japanese communications
company NTT.
Many are looking for reassur-
ance about where their data will
be stored in increasingly global
networks of cloud datacentres.
But looking ahead the cloud is
likely to provide fewer shocks. It
will become more transparent as
suppliers fine tune their services
and terms of business. Mean-
while, customers will buy with a
greater certainty of what they will
be getting.
Shareanddiscussonlineatraconteur.net
CLOUD
SERVICE
MODELS NUMBEROFPROVIDERS
DATABASE,WEBSERVER,
DEVELOPMENT TOOLS...
VIRTUAL MACHINES,
SERVERS, STORAGE,
NETWORK...
THECLOUDPYRAMID
CRM, E-MAIL,
VIRTUAL DESKTOP,
COMMUNICATION,
GAMES...
Software-as-
a-Service
Platform-as-
a-Service
Infrastructure-
as-a-Service
CLOUDCLIENTS-APPS,BROWSERS,MOBILES
PUBLICCLOUDSERVICES,WORLDWIDE(US$M)
Source: Gartner 2014
MOST
POPULAR
LEAST
POPULAR
WHICHSERVICESAREYOUUSINGINTHEPUBLICCLOUD
ORTHEPUBLICPORTIONOFYOURHYBRIDCLOUD?
42%
Collaborationsoftware
42%
IaaS
39%
Disasterrecovery
56%
Cloudstorage
62%
SaaS
23%
Cloud-based
networkmanagement
26%
Businessintelligence
21%
Security-as-a-Service
21%
Hybridcloudintegration
13%
Desktop-as-a-Service
SaaS
PaaS
IaaS
PUBLIC,PRIVATEORHYBRIDCLOUDSTORAGE?
35,777
2,492
22,374
3,604
9,208
132,605
49,060
5,045
38,720
7,199
25,117
214,313
53,553
5,957
45,503
8,718
32,802
253,436
20152013
Cloudbusinessprocess
servicesTOTAL
2014
Cloudapplication
infrastructureservicesTOTAL
Cloudapplication
servicesTOTAL
2016
Cloudmanagementand
securityservices TOTAL
2017
Cloudsysteminfrastructure
servicesTOTAL
2018
Publiccloud
servicesTOTAL
58,843
6,912
52,911
10,136
41,826
293,918
THOUSANDS OF
APPLICATIONS IN
THE CLOUD
FEW CLOUD
PLATFORMS
ELITE GROUP
OF PROVIDERS
SCALABILITY
SECURITY
PERFORMANCE
RELIABILITY
COST
PUBLICCLOUD PRIVATECLOUD HYBRIDCLOUD
Veryhigh Limited Veryhigh
Good,butdependsonthesecurity
measuresoftheserviceprovider
Mostsecure,asallstorageis
on-premise
Verysecure;integrationoptionsadd
anadditionallayerof security
Medium;dependson internet
connectivityandservice
provider availability
High,asallequipment
ison-premise
Mediumtohigh,ascached
contentiskepton-premise,but
alsodependsonconnectivityand
service provider
Verygood;pay-as-you-gomodel
andnoneedforon-premise
storage infrastructure
Good,butrequireson-premise
resources,suchasdatacentre
space,electricityand cooling
Improved,sinceitallowsmoving
some storageresourcestoapay-
as-you-gomodel
Lowtomedium Verygood Good,asactivecontentiscached
on-premise
Source:TechTarget 2013
Source:Raconteur
40,207
3,330
27,321
4,643
13,341
157,776
44,555
4,143
32,646
5,830
18,585
184,537
6. CLOUD FOR BUSINESS
11raconteur.net twitter: @raconteur10 raconteur.net twitter: @raconteur
ȖȖ Over the past few years, more
businesses have discovered the
benefits of using the cloud to pro-
vide elements of their IT infra-
structure. Often the initial deci-
sion will have been based around
costefficienciesandtheattraction
of not having to pay large upfront
costs, but for many the cloud has
also been a source of innovation
that has helped to drive organisa-
tionalgrowthorchangethewayin
which they operate.
One of the biggest advantages
has been the ability to experiment
with new offerings without hav-
ing to commit to costly projects.
“Many business leaders will tell
you that true innovation is try-
ing out different ideas and cloud
computinghasbrokendownsome
ofthetraditionalcostbarriersthat
can prematurely halt this kind of
trialanderror,”saysAndyBarrow,
technical director at ANS.
“If a small enterprise is develop-
ing a smartphone application or
website for particular territories,
public cloud providers like Ama-
zon or Google can be used to build
apresenceandrolloutacampaign
quickly, while only paying for the
cloud provision that they need in
each of those territories.”
Othershavefoundmoreefficient
ways of working on the back of
being able to access information
from almost anywhere, across a
rangeofdevices.“Physicallocation
no longer matters, so the best tal-
ent can be sourced wherever they
are to create unique, global teams
basedonexpertise,”saysPeteBax-
ter,vicepresidentatAutodeskUK.
“The cloud is enabling businesses
todowhattheycouldn’tdobefore.”
The ability to access software
through the cloud is also helping
IT departments provide extra
resources or functionality to busi-
ness teams, without physical or
geographicrestraints.“Cloudplat-
forms are allowing thousands of
point solutions to be developed
by IT and the business alike,”
says Steve Cardell, president of
enterpriseservicesanddiversified
industries at HCL Technologies.
“Thisisahotbedofinnovationand
creativity,bringingthepotentialto
enrich every job role.”
AGILITYANDINNOVATION
CASESTUDY
CASESTUDY
TRACINGSUCCESSTOTHECLOUD
GETTINGACAFFEINEBOOST
Demand-generationmarketingagencyTrace-
pointstartedupthreeyearsagoanddecidednot
toownanyserverhardware,butinsteadtorely
onthecloud.
Thebusinesssawimmediatepracticalbenefits,
particularlyaroundsharingfileswithclients
andstaff,buthasalsousedthecloudtohelpit
becomemoreinnovativeandresponsive,toboth
itsownneedsandthoseofclients.
CompanyfounderJamesCoxsaysthereallight-
bulbmomentwaswhenthebusinessswitched
fromatraditionalaccountancymodeltoacloud-
basedpackage.“Althoughwewerequitequick
atgettinginvoicesandexpensesacrosstothe
accountants,itwouldtakefourorfiveweeksto
getfinancialinformationbackintothebusiness,”
saysMrCox.“Nowwecancloseourbooksfive
daysaftertheendofthemonth,andveryquickly
seewhichactivitiesareproducingthebest
resultsandwhichneedsomeattention.”
Thecloudmodelhasalsohelpedthecompany
competewithmuchbiggeroperatorsbyenabling
ittoaccessarangeofsoftwarepackagestooffer
clients.“Thesebringtogetherdatasilos,inplaces
suchasGoogleAnalytics,customerrelationship
managementorsocialmediasoftware,andcon-
nectitalltogether,”hesays.“Itwasalwaysmuch
moredifficulttolinkupdifferentpartsofthebusi-
nesswhenthingsweren’tinthecloud.”
LikeMrMilligan,MrCoxattributesmuchofhis
business’ssuccesstothiswayofworking.“We
wearitasabadgeofhonourthatwehavenever
lostaclientandwecouldn’thavegrownaswe
havewithoutdeliveringatangibleimpacttotheir
businesses,”hesays.“Wecouldn’thavedone
thatwithoutthecloud.”
ForAndyMilligan,founderofconsultancy
firm CaffeinePartnershipandauthorof
Brand ItLikeBeckham,thecloudhascome
toepitomisetheinnovationhisbusiness
stands for.
“Whenwefirstsetup,wewantedtobean
unconventionalconsultancysowelookedat
whatwewoulddodifferently,”says
Thecloudisenabling
businessestodowhatthey
couldn’tdobefore
This ability is helping organisa-
tions embrace trends, such as big
data, modelling and simulation,
and 3D animation, says Professor
Sian Hope, chief executive of HPC
Wales. She gives the example of
architectural visualisation firm
iCreate, which has used the pro-
cessing power of supercomputers
based in the cloud to improve
details of its animations and
reducetheamountoftimeitspent
rendering them. “This increased
quality, alongside faster produc-
tion speeds, allows the company
to compete more effectively in a
globalmarket,takingonlargerand
more ambitious projects, and pro-
viding services to more customers
thanpreviouslypossible,”shesays.
But Chris Harding, director
of interoperability at The Open
Group, a vendor and technology-
neutral IT consortium, also has a
wordofwarning,despiteacknowl-
edging the potential of the cloud
as a source of innovation. “The
advantages of being able to use
resources as and when you need
them, and paying only for what
you use, often make the decision
tousecloudfordevelopmentano-
brainer,” says Dr Harding.
“Buttheconsiderationsforlong-
term operation of systems are
very different and cloud is not
always the best solution. Do not
fall into the trap of relying on the
specialfeaturesthatyourdevelop-
ment cloud provides, so that it is
impossible to move to an in-house
or hosted platform, or even to
anothercloudproviderthatmaybe
more economic for your produc-
tion system.”
INNOVATIONISAS
FREEASACLOUD
Flexibilityofferedbycloudcomputing
makesbusinessesmoreagileandableto
innovatewithoutcostlycommitmentstoIT
infrastructure,asNickMartindalereports
MrMilligan.“Wethoughtnimblenesswasthe
key,andtodothatweneededpeoplewhowere
reallygoodatthinkingsmartlyandquickly.”
Byenablinggenuinelyflexibleworking,the
company’suseofthecloudhashelpedboth
recruittherightkindofpeopleandcreatethe
conditionsinwhichtheirnaturalinstinctscan
flourish.
“Ourclientstendtobeseniorleadersand
ourpropositionisgivingthemexperienced
businesspeoplewhowillhelpthemtogrow,”
hesays.“Youcanonlydothatifyouhave
expertpeople,andtheytypicallytendtobe
self-startersanddon’twanttobemanagedina
traditional way.”
Morepractically,thecloudalsomeansstaffcan
bebasedalloverthecountry,whichallowsthe
growingconsultancytorespondquicklytonew
projects.“Ifaclientasksifwecanstartwork
tomorrowinBirmingham,Glasgoworeven
overseas,wecansayyesbecausewe’llhave
oneofourconsultantassociateswhodoesn’t
livethatfaraway,”saysMrMilligan.
Thecloudalsocreatesaculturewhere
partneringwithotherorganisationsbecomes
thenorm.“Theabilitytolinkupwithnimble
networksallowsustocreateamuchbetter
offering,”hesays.“Atrulyinnovativemindsetis
naturallycollaborative.”
sioned by Adapt, 75 per cent do not
feel that their cloud provider really
understands their business and one
in four businesses does not expect
their cloud provider to be meeting
their business needs within the next
12months.
The survey, conducted by Easy-
Insites on behalf of Adapt in March
2014, comprised 102 respondents
from commercial organisations
with 200-plus employees in the
UK. It discovered that cloud is cur-
rently used to support a wide range
of requirements. Some 60 per cent
of businesses use it to manage
diverse workloads from test and
development to business-critical
applications, with specific com-
pliance and governance require-
ments and varying infrastructure
demands. With this diversity comes
natural specialism – you wouldn’t
put your low-priority workloads
on an expensive extreme perfor-
mance platform in the same way
you wouldn’t buy a Ferrari to tow a
caravan – it’s about fitness for pur-
pose and the most efficient, appro-
priate solutions for the objectives
you need to achieve.
What all businesses agree on is
the need to drive maximum return
from their existing investments and
develop a future strategy that is both
relevant and the right-fit. So can one
provider do it all? Tellingly, some 62
per cent of businesses are already
multi-sourcing and 53 per cent of
respondents had learnt from experi-
ence that a single provider could not
meetalltheirneeds.
Provider specialisms can help busi-
nesses achieve more, faster. How-
ever, managing a range of provid-
ers requires considerable time and
effort on the part of in-house teams,
Three quarters of UK businesses
are now officially “in the cloud” in
one form or another. The universal,
horizontal benefits of agility and
utility are undeniable and compel-
ling, but businesses still need to be
able to translate these into enable-
ment and competitive advantage
to really get the most out of their
cloud investments.
Not all clouds are created equal,
and depending on your drivers,
desired outcomes and preferences,
some will be a far better fit than
others. But in a fragmented, rap-
idly evolving provider market that
features niche startups, traditional
infrastructure providers, telcos
and a technicolour array of differ-
ent propositions and services, it is
hard to be (and stay) well informed.
It’s sometimes difficult to know
where to go and how to map your
changing requirements to individ-
ual provider capabilities.
Amismatchisevidentbetweenwhat
UK businesses need versus what
they actually get from their provid-
ers. According to research commis-
forcing investment at both a service
management and supplier manage-
ment level, and potentially missing
out on economies of scale. The indi-
vidual providers meanwhile inevi-
tably have an incomplete view of
the customer, so organisations are
not aligned to support their overall
long-termgrowthstrategy.
Against this backdrop, the idea of
working with a single overall pro-
vider that manages these various
relationships can be highly appeal-
ing. Cloud brokers or aggregators
match organisations with providers
that can service their needs at a par-
ticular point in time, or on a certain
cost model. But because the broker/
aggregator is a tactical rather than
strategic role, their ability to develop
long-term relationships that evolve
withcustomerdemandislow.
Another option is the cloud inte-
grator. Integrators are the advisory
conduit between the business and
what the complete provider land-
scape can deliver. Unlike brokers
and aggregators, who simply bundle
ABOUTADAPT
multi-provider services together to
be consumed through one contract,
integrators take the long-term part-
nership view, comparing providers
and clouds through the eyes of your
business, and evaluating the poten-
tial for specific commercial, opera-
tional, technical and compliance
gain. Cloud integrators are not cre-
atedovernight–ittakesyearsofreal-
world experience and significant
investment in platforms, people and
processestoreallydeliverresults.
But the fundamental difference is
that the integrator takes account-
ability and responsibility for end-
to-end service management,
bringing together provider, legacy,
customer-owned and public hyper-
scaler solutions to achieve a set
of goals or outcomes. This single
pane, comprehensive view reduces
complexity, and delivers more
meaningful insight and intelligence
back to businesses.
The integrator approach empow-
ers organisations to maximise their
return on investment, and really capi-
talise on the breadth of choice and
options available, maintaining a per-
manentlyoptimisedblendofservices,
solutions and providers that repre-
sent the best fit for delivering busi-
ness outcomes for today and tomor-
row’s aspirations. This is a marked
difference from the traditional out-
sourcing concept, under which cus-
tomers tend to be locked into three or
five-year cycles with little scope for
flexandchangealongtheway.
Crucially, it also releases in-house
IT teams from managing those rela-
tionships, freeing them to focus on
getting new products to market more
rapidlyanddeliveringreal-worldben-
efitbacktothewiderbusiness.
According to the research, almost
half (48 per cent) of UK businesses
expect to make big changes to their
cloudplatformsinthenext12months.
Ifyouareoneofthem,takethetimeto
consider your options carefully. Keep-
ing your teams focused on creating
business value and outsourcing the
effort, worry and uncertainty associ-
ated with choosing, migrating to and
managingmultiplecloudenvironments
mightjustbetherightmoveforyou.
Ifyou’dliketofindoutmoreabouthowa
cloudintegratorstrategycouldhelpyour
businessmakethemostofthecloud,visit
www.adapt.com/extending-your-cloud
Canoneproviderdoitall?
The rise of the integrator model helps UK businesses make the most
of the cloud, says Adapt's Tom Needs
Outsourcingtheeffort,worry
anduncertaintyassociated
withchoosing,migratingto
andmanagingmultiplecloud
environmentsmightjustbethe
rightmoveforyou
“Inrecentyears,financialuncer-
taintyhasforcedtacticaldecisions–
it’snowallaboutgearingforgrowth
again.Agoodcaseinpointwasacus-
tomerwhohadbeenacquiredand
leftwithcostlyout-of-supportlegacy
infrastructureandarequirementto
integratecomplexcoreHRandpay-
rollsystems.
“Ourexperiencemeantwewere
abletotakeonmanagementofthe
legacyand,collaboratingwiththe
customer,designedcreativetrans-
Adaptisanaward-winning,end-to-
endmanagedservicesproviderand
cloudintegrator.Wehelpcustomers
makethetransitiontohighlysecure,
scalable,enterprise-classITthat
deliversreal-worldadvantage,ena-
blingchangeandinnovation.
formationplansthatexploitedamix
ofpublicandprivatecloudservices,
whilemovingtowardscomplete
integrationwiththenewparent
company’ssystems.Theresult–a
fastertimetobenefitandasizable
costreduction,puttingthemina
strongpositiontogrowtheircom-
binedmarketshare.”
KevinLinsell
Headofservicedevelopment
Adapt
Adaptservicesincreaseagility.Our
integratedofferingspanstheentireIT
infrastructurefromend-to-endman-
agementandcloudservicesthroughto
colocation,hostingandcomplexnet-
workingsolutions.Formoreinforma-
tion,visitwww.adapt.com
INTEGRATEDCLOUDINCONTEXT
ONECLOUDPROVIDERDOESNOTFITALL
Useprivatecloud
65%
Usepubliccloud
43%
Usecommunitycloud
23%
Useblendedhybridcloud
31%
COMPANIESARETRYINGTOCREATETHERIGHTCLOUDMODELTOMATCHTHEIRNEEDS THEREISAMISMATCHBETWEEN
WHATBUSINESSESREQUIRE
VERSUSWHATTHEYACTUALLY
GETFROMPROVIDERS
OFUKBUSINESSESARE
OFFICIALLYINTHECLOUD
75%
USECLOUDFORBOTHBUSINESS-
CRITICALANDGENERALPRODUCTION
ACTIVITIES
60%
AREUSINGMORETHANONE
PROVIDER
62%
AGREETHATONECLOUD
PROVIDERCANNOTDOITALL
53%
DONOTEXPECTTHEIRCLOUDPROVIDERTOBE
MEETINGTHEIRBUSINESSNEEDSIN12MONTHS
DONOTFEELTHATTHEIRCLOUDPROVIDER
REALLYUNDERSTANDSTHEIRBUSINESS
Tom Needs
Chief commercial officer, Adapt
7. CLOUD FOR BUSINESS CLOUD FOR BUSINESS
13raconteur.net twitter: @raconteur12 raconteur.net twitter: @raconteur
OPINION
Perceptionofthe
cloudisshiftingtothe
bestwayofmoving
companiesintothenew
ageofdigitalbusiness
CLOUDFOR
DIGITALBUSINESS
GregorPetri,Gartnerresearch
director,looksintothecloudand
thenewageofdigitalbusiness
33
Movefrombeing
anITbuilder
toaservicebroker
COMMERCIALFEATURE
The modern chief information officer needs to
focus attention on finding new ways to add value
to the business, says Dave Allen, NetApp vice
president for Northern Europe, the Middle East
and Africa, and general manager for UK Ireland
Thethingsthatcreaterealvalue
aretheapplicationswhichpower
yourbusinessortheproductsyour
businesscreates
modityareas,youcanmakedecisions
about how to deal with them. Do you
have them delivered to you as a cloud
service? Or do you build shared infra-
structures that are highly efficient
and automated to reduce the costs of
running them? Typically this is a dis-
cussion focused on operational excel-
lence and legislative requirements,
ratherthantechnology.
The opportunity for CIOs to add
value and competitive differen-
tiation to the business increases
exponentially as investment shifts
from commodity IT to business
value IT and new opportunities.
According to Gartner, 63 per cent
of IT budget is spent running cur-
rent IT infrastructure, 21 per cent
on meeting the natural growth in
application performance require-
ments and data, but only 16 per
cent on new opportunities, where
there is the potential to create the
most value.
This is the challenge for a modern
CIO: how do you maintain opera-
tional excellence while increasing
investment on ways to add busi-
ness value and exploit your unique
data? How do you move from being
abuilderofITtoabrokerofservice?
NetApp creates innovative prod-
ucts, storage systems and software
that help customers around the
world store, manage, protect and
retain one of their most precious
corporateassets–theirdata.
For more information visit
www.netapp.com /uk
The IT market is changing faster
than ever. Industry trends, includ-
ing cloud, big data, mobile, flash
and the software-defined datacen-
tre, mean this will only acceler-
ate. The landscape is changing for
chief information officers (CIOs) as
workloads are becoming more dis-
tributed and hybrid cloud becomes
reality. So, given this complexity,
what should CIOs and the rest of
us in IT be discussing and thinking
about? Where should you be look-
ing to save money and where to
invest your time?
The things that create real value
are the applications which power
your business or the products your
business creates. With more focus
here it’s amazing how much addi-
tional value IT can add through
aggressive application of tech-
nology innovation. An example is
accelerating test and development
by enabling developers to instantly
create database copies. The focus
should be providing high levels of
automation and self-service.
Companies are constantly look-
ing to exploit data and informa-
tion, whether it’s social media
feeds, such as the Twitter Firehose
which streams 500,000,000 tweets
directly to you every day, new ana-
lytics tools, such as Hadoop, to
mine vast quantities of information
for trends and patterns or develop-
ing BYOD (bring your own device)
strategies to better enable your
mobile workforce.
For example, NetApp IT recently
deployed a Hadoop solution, which
has reduced queries on 24 billion
records from four weeks to less than
10.5 hours, accelerating the compa-
ny’s ability to respond to customers’
needs.Itenabledapreviouslyimpos-
sible query on 240 billion records in
less than 18 hours, further enhanc-
ing its proactive service capabilities.
A survey by Vanson Bourne shows
that 69 per cent of C-level executives
cite technology as one of the main
reasons why business decisions are
notbeingmadequicklyenough.
The things IT has to do to sup-
port the business are necessary
and time consuming, but typically
add little value. Ask yourself the
question, “If I started today from
scratch, what would IT do and
not do?”
Once you’ve identified these com-
ȖȖ For a while, business leader-
ship considered cloud comput-
ing merely as a smarter way to
do IT – with smarter most often
meaning faster, better and, espe-
cially, cheaper.
The part about the cloud being
faster is certainly true. Many a
company finds their IT depart-
ment is able to respond sig-
nificantly faster to their needs by
using cloud services. And if not,
they gain speed by going rogue,
simply bypassing their IT depart-
ment and going straight to the
cloud themselves.
Cheaper is a different question.
Eventhoughcloudproviders,such
as Amazon Web Services, Micro-
soft Azure and Google Compute
Engine, continue to lower their
infrastructureserviceprices,many
companies find that the cost of
infrastructure is only a very small
partoftheirtotalITcost.Sotheuse
ofthecloudisnotnecessarilymak-
ingoverallITsignificantlycheaper.
In response, perception of the
cloud phenomenon is shifting
from merely a smarter way to
facilitate “business as usual” to
the best way of moving companies
intothenewageofdigitalbusiness.
Digital has taken the business
communitybystorm.Afterdecades
of IT lingering at the bottom of the
annual chief executive top ten pri-
oritylistandcostreductionbecom-
ingthemostdiscussedaspectofIT
in boardrooms across the world,
the idea of gaining competitive
advantagethroughdigitalcapabili-
tiesisbackwithavengeance.
Granted, new imaginative
capabilities, such as 3D printing,
smarterdecisionsthroughbigdata
analysisandthepotentialofreach-
ing out directly to millions of con-
sumersthroughsocialnetworking
technologies, did more good to
the momentum of digital than IT
departments finding ways to run
their existing enterprise resource
planning system “in memory” or
“on Amazon”.
Thismadesomearguethatdigital
business should not reside under
the current chief of information
processing and indeed we are see-
ing the new role of a chief digital
officer or CDO emerge in many
organisations. Some old-school
chief information officers (CIOs)
may worry that these fast-moving
CDOs have the same devastating
impact on IT’s role as that other
type of CDO, collateralised debt
obligation,hadonfinancialmarkets
inthewakeofthesub-primecrisis.
Other CIOs cannot wait to
embrace the role themselves to
get back into making a real differ-
encebyusingthecloudtorunwhat
could be described as “software-
defined business”.
Over time, digital business will
make digital resources as impor-
tant to companies as today’s most
mentioned critical success factor
–humanresourcesorHR.Andjust
asbusinessesdidnotconcededay-
to-day control over their human
capital to a corporate staff depart-
ment, neither should we expect
them to do so with digital.
Already we see lines of busi-
ness taking a more active role in
defining their digital future. For
example, by bringing architects
anddevelopersbackintotheirline
organisation.Thatwouldmeanthe
emergence of “rogue” or “citizen”
ITisnotapassingfad,butasignof
times to come.
To manage this change, corpo-
rate IT will need to eschew its
traditional service provider role
for a brokering role, similar to the
roleofcentralHRincorporations,
to provide the crucial governance,
complianceandbusinesscontinu-
ity still needed in the ever-faster
moving digital economy.
Advertsforcloudcomputingareusuallyaboutasexcitingasthoseforanewmicrowave
oven.Youcanheatfoodupquicker,saysone;noupdatestoinstallandnobig
capitalexpenditure,saystheother.Thesedaysweallknowthere’smoretolifethan
microwavedfood.Andthesameistrueforthebenefitsofthecloud.Fiveyearsagothe
internetwaslikethehighstreetwithcompaniessellingtoconsumers.Nowit’scentral
toalmosteverycompany’sbusiness,connectingthemwithsuppliers,employees,
customersandpartners.StephenArmstronghasourtoptenwaysthecloudhelps
businesseswithsomeshop-freshexamples…
TOPTIPS
CLOUDCANBRIGHTEN
UPYOURBUSINESS
TEN
WAYS
JohnWinsor,chiefinnovationofficerat
HavasandchiefexecutiveatVictors
Spoils(VS),saysthecloudisrestruc-
turingtheadagencymodel.VSuses
aglobalteamoffreelancerspaidper
job.XeniosThrasyvoulou,founder
andchiefexecutiveofPeoplePerHour,
arguesthatcrowdsourcingtalentis
thefutureforflexiblefirms.Theonline
marketplaceletssmallfirmsadvertise
projects;freelancersrespond.
04DIFFERENT
WAYS
TO EMPLOY
06SHARING
INFORMATION
NewhamUniversityHospital
NHSTrustservesapopulation
ofsome240,000inEastLondon.
Theadventoftablets,smart-
phones,wi-fiandthecloudmeans
doctorsandnursescanaccess
datainstantlywherevertheyare.
DavidBolton,directorofpublic
sectormarketdevelopmentfor
QlikTech,saysthecompany’s
softwarespeedsupproductionof
reportsandsharesinformationvia
an online dashboard.
Lockingallsuppliersintoyour
supplychainallowsafreeflowof
information,measurement,and
costandinventorycontrol,says
DebraHofman,vicepresidentof
supplychainresearchatresearch
giantGartner.Thecompany
predictsthatby201660percentof
banksworldwidewillprocessthe
majorityoftheirtransactionsin
the cloud.
01SUPPLY
CHAIN
“Usuallyitiseasytodeploywherever
youwant,”saysRobKeenan,headof
UKportfoliomanagementatSiemens
EnterpriseCommunications.London
agencyJamesParkAssociates
designsfirst-classseatsforairopera-
tors,includingSingaporeAirlines,
andusesthecloudtoenableitsAsian
andLondonofficestocollaborateon
design,thuseffectivelyoperatinga
24-hourworkingday.
07WORKING
FASTER
SalessoftwarehotshotSalesforce
measureshowinfluentialemployees
areonthecompany’scloud-based
internalsocialnetworkChatter.Chief
executiveMarcBenioffinvitesthe
company’stop20influencerstothe
quarterlyoff-siteretreatwithtopexec-
utives.“Weestimatewehave25 per
centfewermeetings,26percentless
e-mailandaccessto39percentmore
informationusingChattertocommu-
nicateandcollaborateinternally,”the
companysays.
09COLLABORATION
Manylargeserversrunatlessthan
30percentcapacity,accordingto
PeterZonneveld,co-founderandchief
executiveofGreenclouds.The com-
panybuyssurpluscomputingpower
fromthosewithtoomuchandsellsto
thosewithatemporaryneed.InBrazil,
startupAudioMonitorlinkstothe
country’sradiostations,viathecloud,
andpromptsartistswhentheirtunes
areplayedtomaximiseroyalties.
03NEW
BUSINESS MODELS“Forbusinessfacingachangingmar-
ketandclientneeds,thecloudbrings
incredibleresponsiveness,”says
JacquelineDavey,IBMvicepresident,
cloud.Thecompanyhelpedonline
gamedeveloperMojang,ofMinecraft
fame,spinupitscloudpresencefor
itsnewBattlefield4game.“Using
thecloudallowedustoaddanextra
25,000playersinjustfourhours,”
Ms Davey says.
02MARKET
RESPONSIVENESS
Thecloud’sreal-timedatarecord-
ingandresponseallowsTPVision,
ajointventureofHongKong-based
TPVTechnologyandTVmanufacturer
PhilipsElectronics,tomeasureview-
ers’habitsandfine-tuneprogramming
suggestionsforPhilipsSmartTVcus-
tomers.Thecompanycanpersonalise
programmesuggestionsaspeople
viewandtargetadvertswiththepreci-
sionofasearchengine.
08DATA
GATHERING
Cloud-basedsoftwarecompany
CallidusCloudhasdeveloped
MySalesGame,pioneeringthe
gamificationofsales.MySalesGame
setslevelsandmissionsintoa
company’scustomerrelationship
managementsoftware,suchas
salesstaffadoptingbestpractice,
reachingmilestonesandhitting
targets.Thosefinishingamission
oralevelgetrewardsfrompeer
recognitiononsocialcollaboration
platformsoraperk.
05NEW WAYS
TO MOTIVATE
GreeneMotionistheEuropean
Union’scontinent-widebidto
promotetheuseofelectriccars.
Thesystemhastolink43coun-
tries,allownewcomersonstream,
enableanyGPSdevicetoconnect
tothesystemandmapelectriccar
rechargingdocksacrossEurope.
“Thiswouldhavebeencompletely
impossiblebeforethecloud,”
saysJacquelineDavey,IBMvice
president,cloud.“Usingthecloud,
however,thesystemcangrowas
largeasitneeds.”
10SCALABILITY
8. CLOUD FOR BUSINESS CLOUD FOR BUSINESS
15raconteur.net twitter: @raconteur14 raconteur.net twitter: @raconteur
The complexity and volume of data generated by
sophisticated racing cars means cloud
computing could soon be in pole position
for Formula 1, writes Caroline Reid
Asenterprisesofallsizescontinuetoadopt
cloud-basedservices,DaveHowellasksis
securitystilla major concern?
SKY’STHELIMITFOR
F1ANDTHECLOUD
ACLOUDOF
INSECURITY?
FORMULA1
ȖȖ When millions of dollars are
spenttogainameretenthofasec-
ond advantage, it’s little surprise
that Formula 1 teams are looking
to high-tech solutions, such as
cloud computing, for the future
direction of the sport.
Competing in F1 is a costly busi-
ness. The leading teams spend
more than $400 million each to
propel two cars around a track for
a few hours 19 times a year. Every
teammustdesignandbuilditsown
chassisand,withonly2.5secondsa
lapseparatingthechampionsfrom
the losers, getting the technologi-
cal advantage is crucial.
The most visible components
may be the sponsor-covered chas-
sis and wheels, but it’s what the
eye can’t see that makes the cars
so costly. Incorporating on-board
computing power in an F1 car
presents its own challenges and
increases costs.
To make sure the bodywork is as
slender and aerodynamic as pos-
sible, all the wiring, electronics and
cooling systems must be packed in
a tight space around the engine –
more difficult than it sounds when
there’s 1.25km of wiring and up to
150on-boardsensorstobeinstalled.
Each sensor gives readings up to
1,000 times per second and data is
sent wirelessly from the car to the
pits. This gives around 1.5 billion
samplesofdatafromeachraceand
these are monitored in the garage
while the car is on track, then
analysedafterwardsbysupercom-
puters back at the team’s factory.
Leading teams take around 20
engineers to races just to work on
telemetryread-outs,withafurther
30backatbaseworkingsimultane-
ously. In this environment, quick
transfer of data is crucial.
This is the reason why cloud
computing is starting to play a
major part in the world of F1, long
before the racing car even gets on
thetrack.RedBullRacinghaswon
boththedrivers’andconstructors’
world championships for the past
fouryears,andcloudcomputingis
playing an ever-increasing role in
the team’s quest for victory.
Its head of technical partner-
ships Alan Peasland explains: “At
Infiniti Red Bull Racing we have
a private on-premise cloud that
we use for a variety of simula-
tion and computing tasks. In the
design and development of the
car, we use our high-performance
computer (HPC) to run compu-
tational fluid dynamics (CFD)
simulations and finite element
analysis in order to support the
core design activities.”
This affects areas from the evalu-
ation of aerodynamic performance
totherefinementofthemechanical
properties of a design, such as its
strengthandfatiguelife.Mostofthe
computing power running within
RedBullRacing’sHPCisconsumed
in processing the hundreds of
simulations performed by CFD in
a typical week. Running parallel to
this,theHPCalsoanalysesthedata
produced as the team tests scale
modelsinitswindtunnel.
Toaccomplishthisithasthesup-
port of some of the world’s leading
techcompanies.Suppliersinclude
ȖȖ The cloud is transforming every
aspect of the business community.
Surveys of business owners con-
sistently conclude that the cloud
now plays a significant role in their
ability to compete and realise their
strategic goals. Security though,
continues to be a concern, but is
fast receding as a major barrier to
theadoptionofmorecloudservices.
Cyber attacks have been made
oncloud-basedservicesthatmany
enterprises have come to rely
upon. Twitter, Dropbox, LinkedIn
andGoogleDocshaveallhadtheir
securitycompromisedoverthelast
few years. The Heartbleed secu-
rity scare that impacted on many
cloud-based services was the last
to hit the headlines.
According to researchers at The
Verge, as much as one terabyte of
data per day is being stolen from
businesses, academic institutions,
the military and governments.
David Emm, senior security
researcher at Kaspersky Lab, says:
“Recently, trust in cloud storage
has been undermined somewhat
by the Snowden [NSA] leaks and
growing fears about privacy. I
think it’s too early to say whether
thiswillaffectthetake-upofcloud
services significantly. Although
it may well ensure that security
issues become a key part of the
negotiations between cloud pro-
viders and prospective clients.”
With Andy Barrow, technical
director at ANS commenting:
“Security concerns are often a
scapegoat used by IT teams who
are adverse to change, rather than
a legitimate concern. In reality,
working in the cloud means busi-
nesses can access a level of data
security that may be cost-prohibi-
tive to invest in themselves.”
Findings from the Cloud Indus-
try Forum (CIF) reveal busi-
nesses are pushing ahead with
cloud adoption despite security
concerns. “Around 69 per cent
of businesses express concerns
about security, yet the overall
cloud adoption rate has increased
rapidlyfrom48percentin2010to
69percentin2013,”saysCIFchief
executive Alex Hilton.
Asthecloudbecomesubiquitous,
business owners need to appreci-
ate that the perimeter of their
organisation’s security has shifted
fromtheiron-siteserversandinto
the cloud. In the brave new world
of cloud-supported business, a
fresh appreciation of security
is rapidly developing across the
entire business environment.
To ensure high levels of secu-
rity, businesses need to partner
with cloud service vendors that
can demonstrate they meet cur-
rent security standards, such as
ISO 27001, ISAE3402/SSAE16
and CSA STAR. Carrying out due
diligence when adopting cloud
services is vital to ensure robust
and reliable data security.
When cloud security is consid-
ered, it seems that experience
breeds confidence. As businesses
gainmoreknowledgeandseesecu-
rity concerns are being addressed,
securitybecomeslessofapressure
point to more cloud adoption.
“Overall, the security risks still
exist, but companies are willing to
acceptthemtomakesavingsandto
be more responsive to demands,”
says Dr Gerhard Knecht, head of
global security services and com-
pliance at Unisys. “Others delay
the large-scale implementation
until the first wave of security
breaches and remedial action has
Asbusinessesgainmoreknowledgeand
seesecurityconcernsarebeingaddressed,
securitybecomeslessofapressurepointto
morecloudadoption
Cloudcomputingisstartingtoplaya
majorpartintheworldofF1,longbefore
theracingcarevengetsonthetrack
IBM Platform Computing, Ansys,
iLight, ATT and Siemens PLM
who,accordingtoMrPeasland,“all
contribute to the overall solution
that takes us from initial concept
design, through simulation and
analysis, and into manufacture”.
All this takes place long before a
car turns a wheel on a track some-
times half way around the world
from Red Bull Racing’s Milton
Keynes base. Calculations done in
the cloud are key to making sure
everything runs smoothly.
“Performance on track will be
influenced not only by the new
components we send to each
race that help to tailor the car for
the specific circuit, but also how
quickly the car can be optimised
during the race weekend,” says
Mr Peasland. Information travels
in the other direction too. “Data
captured on-car during practice
sessionswillbetransferredbackto
the factory, by virtue of our ATT
Global EVPN Network, where it
will then be analysed by our team
of experts.”
Perhaps surprisingly, at the
moment cloud computing is little
used for processing data during
the race, and Red Bull Racing and
the other teams instead transport
heavy servers to each race.
Shareanddiscussonlineatraconteur.net
DATASECURITY
been taken care of. This is akin to
companies using the ‘never install
version 1.0 in your company’
approach.”
Ultimately the cloud services
that any business adopts must
instillhighlevelsofconfidenceand
trust,asRajinderTumber,security
consultant at Auriga, concludes.
“Customer trust is of paramount
importance to business owners.
Withouttrust,customerswillseek
business with a rival competitor.
Therefore, businesses need to
ensure they are using secure and
trustworthy cloud-based services
and platforms, as well as imple-
menting and embedding effective
securitypracticestobetterprotect
customer data,” he says.
There is little doubt that the
cloudscape offers massive value
and flexibility that all enterprises
can leverage. The cloud itself isn’t
necessarily inherently insecure. If
asensibleapproachtosecuritypol-
iciesistaken,cloud-basedservices
canbesecurelymanagedtodeliver
the benefits they clearly offer.
Security concerns will prevent
a wholesale move to the cloud for
some time yet, but the advantages
the cloud presents far outweigh
any security concerns.
Security specialist Graham Clu-
ley says it best when he observes
thatthecloudreallymeans“some-
body else’s computers”. In this
context, business owners consid-
ering the cloud and its security
should simply ask themselves if
they are comfortable placing their
data on these systems?
“We have our own software-
defined on-premise cloud,” he
says. “The main reason for doing
so is due to the sensitive nature
of the data being processed and
stored, and also the speed of
access to this data.
“Formula 1 is a high-paced,
time-restricted environment in
all areas of the business, so being
able to have real-time access to
largevolumesofdataiscrucialin
order to perform complex simu-
lationsduringraceweekendsthat
can ultimately deliver increased
performance on the track.”
However,MrPeaslandbelieves
cloud technologies are set
become more important in the
nearfuture.“Ascloudtechnology
advances and with the introduc-
tion of hybrid clouds that can
support our peaks in demand,
it’s highly likely that this will be
an area of development for the
team,” he says.
Bill Peters, chief information
officer of Caterham F1, says his
team is considering migrating
IT to the cloud. “We’re starting
to look at potentially having our
supercomputer capabilities as a
service that we buy, as opposed
to something we have in-house.
Similarly, if we could have reli-
able enough communications to
trackside, there’s no reason why
you couldn’t host all your track-
side systems in the cloud as well,
so you wouldn’t need to carry
thewholeITcircusfromtrackto
track,” he says.
It would also help to cut costs
and, in a sport where many
smallerteamsstruggletokeepup
with the larger outfits’ accelerat-
ing budgets, this could be a driv-
ingforcebehinditsproliferation.
Mr Peasland agrees that “cloud
computing, in the right environ-
ment and used in the correct
way, will most definitely be able
to offer cost-savings.” And that
isn’t the only way it will change
the sport.
He says: “As cloud technology
and services mature, it will not
only be areas such as CFD and
simulation that will benefit,
but all other business systems,
including telephony and com-
munications, design and devel-
opment. And it’s our innovation
partners, such as IBM Platform
Computing and ATT, who will
workwithustomoveusforwards
in this area.”
Formula1motorracing
teamsaredriving
computerdiagnosticsin
thecloud