The document presents a business case for upgrading an insurance company's ICT data security system to accommodate cloud computing. It discusses the advantages of cloud computing, including reduced costs, scalability, and improved productivity. A financial analysis is presented, showing an estimated payback period of 4 years, 28.4% IRR, and 1.98 profitability index. Based on this analysis, the chief information officer recommends implementing the cloud computing project to enhance the company's efficiency and security while minimizing costs.

1. Business Case for upgrading ICT
Data Security System of KD
Insurance PLC to Accommodate
Cloud Computing
By
Keerthi Delwatta: Chief Information
Officer.
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2. Agenda
What is Cloud Computing
Advantages and Disadvantages
Business Proposal
Financial Analysis
Conclusion
List of References
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3. Purpose of Presentation
To enlighten CEO, Board and Executives on Cloud
Computing to upgrade the ICT Data Security System
of the company to protect client’s and firm’s data.
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4. Cloud Computing in Insurance
Industry
How the Cloud is utilized :
Data is stored in the off site virtual server owned by
a service provider on the basis of actual usage.
Associated Risk:
Loss of control over software application.
Over Dependence on service provider for
Maintenance, Upgrading and Management.
Experiences of other Companies:
Very positive and Encouraging.
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5. Cloud Computing in Insurance Industry
Advantages :
Economies of scale
Scalable Processing & Application
Minimum Capital Investment
Speedy Implementation
Higher Productivity
Disadvantages:
Extreme Dependence on the Service Provider
Loss of control over software application
Compromise confidentiality & Privacy
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6. Cloud Computing in Insurance
Industry
 Scope of Recommendation:
Upgrading ICT Data security system to protect Client’s
and Firm’s own data.
To synchronize and ensure integrity of data on servers
and end user devices.
 Infrastructure Requirements:
Cloud specific software applications
Improved Communication Network Facilities
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7. Financial Feasibility
• Base Case Analysis:
7
Base case analysis of cloud computing to accommodate ICT Data security system of K D Insurance Plc.
year 0 1 2 3 4 5 6
Relevant benefits (millions)
Reduced costs of capital $0 $25 $30 $30 $35 $40 $45
Improved productivity $0 $25 $30 $40 $60 $75 $80
Reduced insurance $0 $20 $20 $30 $40 $50 $60
Total improvements (A) $0 $70 $80 $100 $135 $165 $185
Relevant costs
policy development and maintenance $0 $40 $45 $55 $55 $60 $70
software acquisition $40 $10 $10 $10 $10 $10 $10
support team $25 $10 $10 $10 $10 $10 $10
incremental maintenance $0 $0 $10 $10 $10 $10 $10
training $10 $5 $0 $0 $0 $0 $0
Total costs (B) $75 $65 $75 $85 $85 $90 $100
Net cash flow -$75 $5 $5 $15 $50 $75 $85
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8. Financial Feasibility
8
Pay back Period 04 Years
$ 73million
28.4 %d
NPV @ 10%
IRR
Profitability Index 1.98d
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9. Sensitivity Analysis
Criteria: Policy Development & Maintenance Cost:
Recommendation:
 Policy Development & Maintenance Cost is highly sensitive to Net Present value
and hence should be properly controlled.
9
100%
Policy
Development &
Maintenance
Cost
314%
Net Present
Value
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10. Sensitivity Analysis
Criteria: Incremental maintenance cost
Recommendation:
 Maintenance cost is relatively sensitive to Net Present value and hence should be
controlled.
10
100%
Maintenance
cost
47%
Net Present
Value
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11. Sensitivity Analysis
Criteria: Productivity
Recommendation:
 Productivity is highly sensitive to Net Present value and hence should be properly
monitored to ensure desired results.
11
100%
Productivity
288%
Net Present
Value
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12. Conclusion
• Cloud Computing is highly advantageous to the
company as it enhance the productivity , increase
efficiency of the ICT Data Security system while
minimizing the cost and hence I seek your
authorization and financial support for immediate
implementation of the project.
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13. Lessons learnt from Conducting the
Research
The risk mitigation strategy of adopting a Private
Virtual Infrastructure(PVI) Model to share
responsibility for Security of Cloud Computing between
information owner and service provider has been
evolved which is encouraging.
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14. Lessons learnt from Conducting the
Research
Trusted Virtual Machines Identification Technique has
been evolved to ensure proper management of virtual
machines in the data center that encourage cloud
computing.
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15. List of References
1. Kenneth, C, Loudon, Jane P. Loudon 2014,Management Information systems,
Thirteenth Edition, Pearson, England.
2. Das, T K ., and Teng, B.S. (1999), “Managing risks in strategic Alliance”, Academy
of Management Executives, Vol. 13 No. 4, pp. 50 -62
3. J.Heiser and M. Nicolett, Accessing the Security Risk s of Cloud Computing,
Gartner, inc., Stemford, Ct, 2008.
4. M. Armbrust, A. Fox, R. Griffith et all., Above the Cloud: A Berkeley View of
Cloud Commutating, University of California , Berkerley, Berkerly, CA, 2009,
5. Greenberg, A., Hamilton, J., Maltz, D.A., Patel, P. (2009). “The Cost of a Cloud:
Research Problems in Data Center Networks”, ACM SIGCOMM Computer
Communications Review.
6. Undheim, A., Chilwan, A., Heegaard, P. (2011). “Differentiated Availability in Cloud
Computing SLAs”, Proc. GRID conference, pp. 129–136.
7. Menascé, D. A, Ngo, P. (2009). “Understanding Cloud Computing: Experimentation and
Capacity Planning”, Proc. Computer Measurement Group conference
8. http://www.ibm.com/developerworks/cloud/about.html
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