Cloud Computing- Why are we really here and how can you make a success of it.• Where are we now in the IT cycle and how did we get here?• Why is Cloud so transformative?• What are the key drivers behind the ROI from Cloud?• What are the lessons learnt from moving to the Cloud and how should you approach it?
To Microsoft Exchange
Bringing all the benefits of Google apps- horizontal scalability, reliability, etc
To Microsoft Exchange
Look back to see how we viewed previous paradigm shifts
Mainframe – pc – ultimate benefits not forseen
http://www.ecommercetimes.com/story/69737.html?wlc=1271077512&wlc=1271086353 The fact of the matter is that, if you're looking for cheap IT, we can give you cheap IT. However, you're not going to be able to keep up with the competitive value that IT needs to bring to your enterprise. To get that competitive value, you're going to have to spend additional money.The ability to align your IT resources to the needs of the business quickly, get into markets fast, delight customers, sell more, and create supply chain integration systems that provide with frictionless commerce is really where the value is in this.The myth is that cloud computing is always going to be less expensive. I think cloud computing typically is going to be a better, more strategic, more agile architecture, but it's also typically going to be more expensive, at least on the outcome.We're probably going to have to spend more money initially. That's really what the takeaway is from the initial cloud-computing projects that I am involved in. At the end of the day, it's about strategic use of technology. Ultimately, cost reduction should be part of the result, but in getting there, we're going to have to spend additional dollars.
http://blogs.gartner.com/mark_mcdonald/2010/06/27/what-is-the-production-function-of-it/What is the Production Function of IT?by Mark McDonald | June 27, 2010 | 1 CommentUnderstanding IT’s role in the enterprise is complex and incomplete. IT is the subject of great debate as some see it as the source of competitive advantage and others see it as an enabling function. CIOs and IT professionals themselves have a tough time answering the question about IT’s role.Why? because I believe we are asking the question in the wrong way.We need to ask,“What is the production function of IT?”Production function, sounds kind of academic right, but its simply the output you get for all the combination of inputs. Its what you take and what you make.Every part of your enterprise has a production function. So, when you ask different parts of the enterprise what they take and make you get answers like:SALESTOP LINE REVENUE: We take prospects and turn them into ordersSUPPLY CHAINPROFIT: We take orders and turn them into invoicesFINANCECASH: We take invoices and turn them into cashIT?????? Silence ??????I know its silence because I have asked the question to dozens of IT leadership teams. They look at each other and cannot put IT’s contribution in a simple answer. It is not because IT is more complex than these other functions. No its more that IT professionals have thought of themselves as something apart for the enterprise, something special and therefore not falling under the same rules.There are two production functions for IT that can be summarized in two words SPEED and SCALE.SPEED: We take strategy plans and turn them into operational performanceIT’s production function is to deliver speed of execution against the company’s strategy and plans. Strategy execution involves change and change requires IT participation. The faster IT is able to execute its processes, deliver results and accelerate strategy execution the better.IT drives speed when it concentrates on reducing its own internal cycle times for providing IT services, solution development and governance. Concentrating internal operations on speed of execution makes IT more responsive and innovative. IT organizations operating at speed give their business a steady stream of value that actually expands ITs role and enterprise flexibility.Without speed, IT is a bottleneck to strategic execution and operational performance. It is the reason we cannot go faster. This is the reason why change is expensive. The reason why I have to control IT costs, because if they cannot go fast enough for me, then I had better make sure that they do not cost too much.SCALE: We take operations and increase their capacity and reduce their average costIT’s other production function is to create scale of operation across the enterprise. Scale in this sense is the ability to IT to aggregate activities and deliver greater capacity at a lower average cost. IT creates scale through its infrastructure and operations activities that make the modern enterprise possible. IT is one of two scale functions in the enterprise. The supply chain is the other scale function.IT drives scale through the infrastructure by constantly aggregating operations, virtualization and active contract management to gain the benefits of being bigger. Without this scale, growing transaction volumes and the cost of operating disparate infrastructures would literally consume the company’s profit.Without scale, operations drown in a combination of complexity, duplicate cost and faltering service levels. You see this with high growth companies that are heroes that suddenly fail – because they do not have scale.***What is IT’s production function? To deliver speed and scale to the enterprise.Speed and scale can seem as two different things, and that can be part of the reason why they are difficult for CIOs and IT leaders to articulate. Most go “ah ha” when they think about their role in speed and scale.But, when you boil it down, we know why an enterprise has a sales function, a supply chain, a finance function, etc. We had thought that IT existed to manage the technologies that these functions depend on.That is true in terms of the activities IT provides, but ‘to what end’Speed of execution andScale of operation.
Traditional IT departmentIn the past, the only way for a company to maintain control of their business process was to completely own the technology supporting the process. The rationale was that a company's most strategic, differentiating processes are unique and therefore have to built by the company either from scratch or by heavily customizing packaged applications. This also meant owning the entire technology stack supporting the process and the application. So, while the intent was to create differentiated processes that were agile and differentiating, the reality has become that the technology stack is an albatross around the IT team's neck that prevents them from moving as quickly and as efficiently as they would like to.The result is that while IT organizations are keen to support the business, they are unable to go much beyond providing basic services. The solution to the problem of managing the entire stack was traditionally either hosted/managed server services or outsourcing, but each introduces its own problems.http://blog.appirio.com/2009/05/do-your-most-strategic-apps-belong-in.html
OutsourcingIn the case of outsourcing, the enterprise gains cost savings but relinquishes control of their business process and has to adhere to the provider's "best-practice" process. This clearly means that outsourcing can only be applied to commodity processes rather than any differentiating processes or processes where innovation is needed. The IT team's role shifts to primarily vendor management with little ability to innovate or drive the business.
Hosted/Managed ServersHosting gets a bit closer to solving the problem because it reduces some of the IT team's pain in terms of managing infrastructure. However, the IT team still needs to spend a lot of their time maintaining the application and the middleware stack, i.e., applying patches and bug fixes, implementing upgrades, maintaining integrations, etc. In addition, the team also needs to manage their relationship with the hosting vendor. So, again, the main impact is some cost savings but no real gains in terms of agility or ability to innovate or support the business.
IT department in the cloudCloud computing changes the decision process completely. No longer do companies face a choice between relinquishing all control of their business process for cost savings or dealing with the high costs and complexity of supporting an entire software stack.Platforms like Force.com and Google App Engine give companies a way to control the parts of the stack that matter most, the application and business process layer and abstract away the management of the infrastructure. This means that the IT team can focus their energies on driving innovation and supporting the business.
http://gigaom.com/2009/06/17/how-clouds-can-complement-consolidation/As businesses struggle to remain viable, much less grow, cost management is an imperative. Massive data center consolidation, automation and virtualization can drastically reduce costs — reportedly up to a billion dollars annually, in at least one case. However, money isn’t everything: CIOs need to balance what I’ll call the six FACETS of IT: Flexibility, Availability, Cost, Experience, Timeliness and Security.However, money isn’t everything: CIOs need to balance what I’ll call the six FACETS of IT: Flexibility, Availability, Cost, Experience, Timeliness and Security.These goals are often in conflict with each other. For example, consolidation alone can negatively impact availability — by putting all your server and storage eggs into one data center basket. And creating engaging user experiences for interactive applications demands geographic dispersion, the antithesis of consolidation.A hybrid approach that uses cloud services to complement consolidated enterprise data centers can holistically address these six FACETS:
Flexibility — CIOs constantly face the challenges of new technologies, shifting application mixes, and changing market conditions. Unlike fixed-capacity enterprise data centers, cloud services promise “near-infinite” scalability to meet variable or unpredictable demand. But flexibility is more than scalability, e.g., it might entail the ability to shift resources from voice to video, or change data retention policies. This is where virtualization, converged multiprotocol networks, and cloud platforms can help.
Availability -– Today’s global IT users — customers, employees and partners — demand instant gratification 24/7. High availability of applications and infrastructure benefits from reliable components and from rapid detection, diagnosis and repair processes, but fundamentally is enabled via increased redundancy, which drives up cost. However, the cost of outages usually substantially outweighs the cost of mitigation. Unfortunately, since availability can never exceed 100 percent, there are exponentially diminishing returns on redundancy investments. The good news: Flexible, on-demand cloud resources can be provisioned only in the event of a disaster, reducing the cost of enhanced availability.
Cost — Nick Carr has argued that there will be a “big switch” to pure reliance on pervasive clouds to service enterprise IT needs, in the same way that electric utilities — which are also clouds — meet enterprise power needs. McKinsey & Co. has argued the opposite, complaining that cloud services are too expensive. However, for most businesses, the truth is somewhere in between; whenever demand is variable or unpredictable, total cost can be minimized through a combination of enterprise data centers and cloud resources.
Experience — The user experience has become a key competitive battleground; think how much the success of Google search or Apple’s iPhone owe to usability and responsiveness. Unfortunately, global network latencies are greater than the threshold of human delay perception and reaction times (about 150 ms), so data center consolidation can aggravate response time issues as sites close to end-users are shuttered and interactive applications and functions — SaaS, AJAX, keystroke and mouse move processing via remote virtual desktops, interactive gaming — are moved to more remote sites. Therefore, consolidation of enterprise data centers must be complemented by dispersed cloud-based services such as content and application delivery if the user experience is to be positive.
Timeliness — Accelerating time-to-value to meet ever-shorter product lifecycle windows is more important than ever. Cloud-based applications, infrastructure and platforms-as-services can compress time by replacing ponderous requirements, development, testing and/or provisioning processes with template configuration and agile assembly of component services.
Security — Security, in all its dimensions — authorization, authentication, protection, privacy, compliance, etc. — is as critical, if not more so, than the other FACETS. Cloud services have had occasional issues, but the real question is not whether cloud services are perfectly secure, but whether they are more secure than their enterprise counterparts. Just like banks are more secure than homes — because they must be to remain in business — cloud services either are or will be more secure than enterprise data centers. Security can often be maximized either by leveraging pure cloud services, or by complementing enterprise IT with cloud-based security services such as network-based firewalls, anti-DDoS, cloud-based anti-spam and anti-virus, and web filtering.
Cloud. Why? How
Cloud. Why? How.<br />Justin Pirie<br />@justinpirie<br />http://justinpirie.com<br />firstname.lastname@example.org<br />Cloud Computing World Forum<br />London July 1st 2010<br />massdistraction<br />