Cloud computing implications for project management methodologies


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Cloud based technologies are becoming increasingly pervasive across society and are considered by many in business as the next major disruptive innovation. For the first time, organizations can consume, as needed, on-demand, business ready Cloud based enterprise services. This is also known as the Consumerization of IT.

Transitioning to, or deploying new IT systems and services using Cloud technologies present their own unique set of challenges to the IT Departments, Project managers and Pproject management Offices (PMO) alike.
The primary objective of this presentation is to provide a number of key considerations for Project Managers in dealing with projects involving Cloud computing technologies.

This was presented at the 25th International Project Management Institute's Global Conference in Australia on the 11th October 2011 by Rob Livingstone

Published in: Business, Technology

Cloud computing implications for project management methodologies

  1. 1. Cloud computing: Cloud Computing: Implications for Project Management Methodologies.<br />ROB LIVINGSTONE- PRINCIPAL, Rob Livingstone Advisory Pty Ltd, and<br />- Fellow, University of Technology, Sydney<br />Brisbane, 11th October 2011<br />
  2. 2. Cloud computing: Cloud Computing: Implications for Project Management Methodologies.<br />What I’ll be covering:<br />Cloud computing basic definition and attributes <br />Overview: Public, Private and Hybrid Cloud<br />Next few years – from confusion to calm<br />The consumerisation of IT effect in the enterprise<br />Project Management implications<br />Cloud: Some key considerations for organisations<br />The future is now<br />Questions and discussion<br />
  3. 3. 1. Cloud computing basic definition and attributes:<br /><ul><li>Cloud is a very broad term for IT systems accessed via the Internet or your browser.
  4. 4. In public cloud, the various components are all run by an external party, and you do not own anything, other than the data that you load into the system.</li></ul>The primary attributes of public Cloud systems are:<br />You subscribe to the service (never own)<br />The system is accessed via the Internet<br />You neither have control or title over the Cloud system<br />You have limited to full title over the data that you upload<br />
  5. 5. 2. Overview: Public, Private and Hybrid Cloud<br />Private<br />Hybrid<br />Public<br /><ul><li>No control
  6. 6. No ownership
  7. 7. You own data
  8. 8. Apps stay behind
  9. 9. You control all
  10. 10. You may own
  11. 11. Offers balance of security, control
  12. 12. Can be more complex</li></li></ul><li>3. Next few years – from confusion to calm<br />Gartner Hype Cycle 2011 – Cloud has very it’s own cycle<br />
  13. 13. 4. The consumerisation of IT effect in the enterprise<br />… also known as the ‘democratisation’ of IT<br />Fuelled by Cloud and pervasively accessible web based applications as an individual ….<br />I see it, I like it, I want it, I buy it (or it’s free!), I use it – Now!<br />
  14. 14. 4. The consumerisation of IT effect in the enterprise<br />Individuals have unprecedented access to all type of IT systems, from email, file storage, accounting, CRM, banking, shipping, social networking (eg Facebook™ ).. The list is almost endless.<br />What is meant by ‘consumerisation’ of IT?<br /><ul><li>Individuals can use / buy systems as they see fit.
  15. 15. Personal choice and immediacy reigns supreme
  16. 16. Buy it / use it without necessarily a long term in mind
  17. 17. ‘Apps’ – for iPhone™, Android™, etc</li></ul>For enterprises, however, this presents a number of challenges for the unwary, and have potentially serious implications for the PMO<br />
  18. 18. 5. Project Management implications<br />Inconsistency in understanding of ‘Cloud’<br />Cloud: Compression of time<br />Reversal of the traditional business case: ‘buy before you try’<br />Cloud, pilot projects and driving innovation<br />‘The viral cloud’ phenomenon<br />Managing project boundary conditions<br />Challenges for standard methodologies such as PRINCE2<br />Use of cloud technologies BY project managers<br />
  19. 19. 5. Project Management implications<br />a) Inconsistency in understanding of ‘Cloud’<br /><ul><li>While there is largely a solid understanding of what’s inside the public cloud ‘black box’ by CIOs and those in the IT industry, this is largely not the case for line-of-business executives and managers.
  20. 20. As long as this asymmetry of understanding exists, the full relevance and potential of cloud computing may not be fully realised in organisations.
  21. 21. Project managers also need to become familiar with specific issues and challenges associated with cloud computing, and quickly.</li></li></ul><li>5. Project Management implications<br />b) Cloud: Compression of time<br />
  22. 22. 5. Project Management implications<br />c) Reversal of the traditional business case: <br /> ‘Buy before you try’<br /><ul><li>Public cloud offers, potentially, enterprise ready applications in hours or days
  23. 23. Mostly have easy to manage configuration options through a ‘control panel’
  24. 24. Impatient business stakeholders want to bypass the ‘paralysis by analysis’ stages associated with the requirements gathering and analysis phases.
  25. 25. ‘Better 90% on time’ is often the catch-cry of business stakeholders who are becoming increasingly impatient with the complexity and lead times on IT projects.</li></li></ul><li>5. Project Management implications<br />d) Cloud, pilot projects and driving innovation<br /><ul><li>Cloud systems can be invaluable in supporting innovation initiatives in that:
  26. 26. no up front capital is required,
  27. 27. walk-away costs are minimised,
  28. 28. Very speedy
  29. 29. Often does not require IT
  30. 30. The opportunity for immediate and rapid scale-up to production exists without the need provide working capital:
  31. 31. Very tempting for users and business stakeholders
  32. 32. Comprehensive due diligence needs to be done before production scale-up!
  33. 33. Set expectations a the start that the immediate scale-up to production will not automatically occur
  34. 34. Need to manage expectations</li></li></ul><li>5. Project Management implications<br />e) The ‘viral cloud’ phenomenon<br /><ul><li>A viral Cloud is characterised by a localised initial installation of a Cloud system (approved or otherwise!).
  35. 35. Additional subscriptions gradually purchased for others outside of the initial user pool to approve workflows, access documents, process information etc.
  36. 36. The low barrier to entry could mask the potential for additional cost, unmitigated risk and breach of minimum governance standards.</li></ul>A leading Australian University experienced an unauthorised deployment of a Cloud system that was funded from one Faculty’s discretionary budget, as it fell within their prevailing local discretionary expenditure approval limits. This was only noticed when data integrity issues within their core student enrolments databases started occurring.<br />Source: ‘Navigating through the Cloud ‘; Rob Livingstone<br />[ISBN 13: 978-146115285], Page xvii<br />
  37. 37. 5. Project Management implications<br />f) Managing project boundary conditions<br /><ul><li>With the increasing availability of development APIs, as well as vendor ‘applications markets’, there are a large array of satellite applications written by third parties, the quality of which may be variable.
  38. 38. The Salesforce App Exchange, Android Market and the Apple iStore are examples of such eco-systems.
  39. 39. Some of these applications can be implemented by ends users, and extend the boundary of projects in an uncontrolled manner
  40. 40. What project governance controls can be implemented to mitigate adverse consequences?</li></li></ul><li>5. Project Management implications<br />g) Challenges for standard methodologies such as PRINCE2<br /><ul><li>The comprehensive use of rigorous, large scale project methodologies such as Prince2™ are often not appropriate for all but the largest of enterprise IT projects, although key elements are universally applicable to all projects.
  41. 41. The interpretation and adaptation of the various large scale project methodologies to volatile ‘implement first and modify as you go’ environments needs some careful consideration
  42. 42. This is likely to present a large challenge to organisations that are impatient to get results</li></li></ul><li>5. Project Management implications<br />h) Use of cloud technologies BY project managers<br /><ul><li>No need to buy PM software – just use it for the life of the project
  43. 43. One of the compelling value propositions in cloud computing is universal access, and the opportunity of lowering the barrier to entry for applications by using handheld applications using iPhone and Android devices, for example.
  44. 44. This could have very positive implications for geographically distributed projects, where information sharing and timely updates of project activities and status’ are important to mobile project stakeholders
  45. 45. Issues for consideration:
  46. 46. Can you scale down to a single user at the end of the project?
  47. 47. Can you ‘park’ your PM data and electronic artifacts that are stored in the cloud for later use if needed?
  48. 48. What happens to the data if you leave the cloud? Can you extract it in a useful form?</li></li></ul><li>6. Cloud: Some key considerations for organisations: <br />Security<br />Privacy<br />Cost<br />Commercial, legal and jurisdictional<br />Vendor contracts<br />Regulatory<br />Strong PM to counter opacity of Cloud offerings<br />Governance: System change and version control <br />
  49. 49. 6. Cloud: Some key considerations for organisations: <br />a) Security<br /><br />
  50. 50. 5. The key considerations for organisations: <br />b) Privacy<br />
  51. 51. 5. The key considerations for organisations: <br />b) Privacy<br /><br />
  52. 52. 6. Cloud: Some key considerations for organisations: <br />c) Cost<br />Know the TCO over the expected life-span of the system<br />Do not exclude on-premises (Private Cloud, or traditional hosted) if these options exist<br />Compare on like-for-like basis<br />Illustrative example only<br />
  53. 53. 6. The key considerations for organisations:<br />d) Commercial, legal and jurisdictional<br />What are your key drivers behind the adoption of Cloud?<br /><ul><li>Drive innovation?
  54. 54. Lower cost?
  55. 55. Increase flexibility?</li></ul>Level of protection under the contract<br /><ul><li>Do the remedies for service outages make commercial sense?
  56. 56. Have you read and understood your vendor contract</li></ul>What is the cost of seeking legal recourse?<br /><ul><li>If you provider’s contract is in an overseas legal jurisdiction, how practical will it be to seek damages?</li></li></ul><li>6. The key considerations for organisations: <br />e) Vendor contracts<br />
  57. 57. 6. The key considerations for organisations: <br />e) Vendor contracts<br />What’s your Cloud contract duration?<br /><ul><li>If this is truly utility Cloud, why commit to a contract for a long period of time? </li></ul>If marketed on ‘per user per month’ pay on that basis. <br /><ul><li>Some request annual pre-payment. You are then the vendor’s banker.</li></ul>Request a copy of the draft contract early<br /><ul><li>The procurement cycle can be time consuming for large projects.
  58. 58. All that effort could be wasted if there is a major sticking point in the contract.
  59. 59. Read your contract and understand what ie means!</li></ul>Global Cloud providers are reluctant to change standard contracts <br /><ul><li>Standardisation is the cornerstone of Cloud
  60. 60. Some vendors will amend terms if you have large buying influence</li></li></ul><li>6. The key considerations for organisations: <br />f) Regulatory<br />The International Accounting Standards Board (IASB) and the US Financial Accounting Standards Board (FASB) Planned changes in reporting off-balance sheet leasing (2012-2013)<br /><ul><li>All leases, regardless of their terms, should be accounted for in a manner similar to how finance leases are treated today.
  61. 61. Definition of annual software subscription as a lease?</li></ul>A spectrum of regulations and standards may apply to your organisation:<br /><ul><li>The Privacy Act 1988
  62. 62. Corporations Act 2001
  63. 63. Australian Standard AS ISO 15489 - Records Management
  64. 64. Australian Prudential Regulation Authority
  65. 65. … and more ….</li></li></ul><li>6. The key considerations for organisations: <br />g) Strong PM to counter opacity over key aspects in the cloud<br /><ul><li>One of the fundamental benefits of public cloud is the removal of IT complexity.
  66. 66. It’s invisible to the end user.
  67. 67. Paradoxically, this presents those organisations concerned about IT security, risk and governance with a challenge because lack of visibility of what’s ‘under the covers’ may present unacceptable risks if fully disclosed and understood.
  68. 68. Effective project management governance is critical to ensuring that these risks are surfaced for scrutiny and management.
  69. 69. Know which questions to ask!</li></li></ul><li>6. The key considerations for organisations: <br />h) Governance: System change and version Control<br />You get to take what is given …..and maybe when it suits you ….<br />
  70. 70. 6. The key considerations for organisations: <br />h) Governance: System change and version Control<br />Modify / Test Interfaces <br />V1.1<br />Eg: V1.1 èV2.0<br />
  71. 71. 6. The key considerations for organisations: <br />h) Governance: System change and version Control<br />Scenario: Upgrading your Cloud ó’other system’ interfaces<br />Usual practice to take a ‘point in time’ backup as a restore point before implementing the upgrade. <br /><ul><li>This is in the event of needing to fallback to the pre-upgrade point should the upgrade fail for whatever reason.</li></ul>If your Cloud provider cannot restore designated elements of, or your entire system, in an acceptable timeframe*, what can you do? <br /><ul><li>Core to effective governance of IT is change control and recovery processes</li></ul>(eg SOX Section 404 – General controls, to name but one).<br />* - eg: Restore may be needed immediately. Some providers can take a few days<br />
  72. 72. 7. Cloud – The future is now<br />Cloud technology, as with any other innovation, has the potential to do things cheaper, faster and better.<br />This has significant implications for both CIOs, IT Departments and Project managers<br />Cloud has the potential to be a real game changer for the astute<br />Organisations need to deliberately define their strategy now:<br /><ul><li>Be an early adopter, or
  73. 73. A fast follower, and leap-frog the early adopters be capitalising on their experiences</li></ul>To achieve the real benefits of Cloud technologies, understand:<br /><ul><li>the true cost
  74. 74. the value
  75. 75. the risk
  76. 76. when to buy
  77. 77. what to buy, and
  78. 78. when to exit the technology and/or switch horses.</li></li></ul><li>8. Discussions and questions<br />Rob Livingstone Advisory Pty Ltd<br />ABN 41 146 643 165<br /><br /><br /><br />P: +61 2 8005 1972<br />P: +1 609 843 0349<br />M : +61 419 632 673 <br />F: +61 2 9879 5004<br />rladvisory<br />© All rights reserved. Unauthorised redistribution not without prior approval<br />