Cloud Organizational impact, Emerging trends
Transcript of Cloud Organizational impact, Emerging trends
2011
Impact of Cloud on Enterprise Organization - PoV
Executive Overview R1.1 Alex Shahidi August, 15 2011
§ Ability to shi+ to service provider mindset and structure is directly propor6onal to maturity of IT service
management in an organiza6on. This means realis6c service level measurements against stated targets and true cost of delivering it. This cost is o+en poorly defined, understood or measured.
§ Well defined demarca6on of provider and consumer allows for clear defini6on of responsibili6es. Cloud providers sell to consumers and that is a different rela6onship than exists in IT today.
§ The real promise of cloud compu6ng lies in developing new markets and services. This requires process, flow, promo6on tracking, response management, and a slew of other ac6vity on the fly that in turn require providers to ever more flexibly and expediently enable changes in workloads , types, QoS, and physical and virtual resources. Managing this mode of interac6on at the speed of internet requires structurally new, more agile teams and forma6ons than what today’s enterprise IT is used to.
§ This new team and organiza6on structure is already challenging many. Some will be significantly disrupted. Most will need substan6al help naviga6ng this complexity and morphing.
§ Most IT ini6a6ves tend to target current pain points or new func6ons but to effec6vely leverage cloud a larger strategic view is crucial to success. Enterprise IT should adopt this approach in offering services to the business.
§ Business needs to respond to customers and providers need to understand both paMerns to deliver the right plaNorm and tools to facilitate demand-‐response
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Paralleling cloud technology
Evolution of IT organization to demand-response delivery model
1-‐ Enterprise infrastructure architecture and applica6on design that is 6ghtly coupled
• What does a cloud infrastructure look like and why it is so different • Why applica6ons must func6on independent of the infrastructure plaNorm • Transi6on from virtual to Cloud can leverage many exis6ng assets
2-‐Systems management, capacity, work flow that is sta6c (or semi-‐sta6c), containerized and is build on top of exis6ng infrastructure and applica6on constraints and limita6ons
• How to separate applica6ons from infrastructure and key decision factors • Leveraging integra6on point services (intelligent API management), and key decision factors • Can current enterprise middleware deliver the abstrac6on necessary for separa6on?
3-‐Enterprise IT organiza6on that is formed around technology and applica6on silos
• Applica6on silos evolved with containerized apps. Virtual apps are distributed & data store driven. • Infrastructure silos evolved along an IT Push model, by architecture & design, that creates areas of
control. Cloud applica6ons are demand driven and interconnected across physical boundaries • With transi6on to cloud tradi6onal control is exchanged for speed and agility • This organiza6onal shi+ may parallel architecture of cloud. Loosely coupled parts in a DC centric
supply/demand driven approach
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Opportuni5es to unleash new efficiencies, services & business models by cloud face three major hurdles
Challenges of cloud for Enterprise
New models and capabili5es of cloud should determine structure of suppor5ng and managing organiza5on
§ A change in business decision or process should not impose changes within infrastructure and plaNorm (and vice versa). As such that decision chain prominent in most organiza6ons should be untangled
§ Technology plaNorm becomes the DC that may be internally operated, or outsourced in exchange for a fully managed plaNorm.
§ The business plaNorm may be outsourced, depending on complexity and scale. But it is a value add ac6vity that itself is o+en a business asset
§ Business management plaNorm is the apex of enterprise’s business model support capability. This is essen6ally driven by analy6cs, market intel and emerging social enterprise plaNorms such as data.com
§ The informa6on value chain and its key segments define the organiza6on and skill sets that own or support it. As data is released from the confines of infra and app dependencies to flow where demand pulls it, defining and designing the structure and architecture of that demand becomes the core around which a cloud IT organiza6on is built.
§ It invariably requires a resource shi+, the speed of which is a func6on of an organiza6on’s roadmap, risk assessment and priority
§ The challenge is to minimize disrup6on without compromising on target state and 6melines
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Unwinding business from IT
Cloud optimized organization
Lack of well defined risk factors and key decision points are not conducive to big decision making § Organiza6onal impact: from Capex to Opex driven by accurate cost analysis to establish full delivery cost , to
speed and size of shi+ or strategic sequence of implementa6on, changing roles and 6tles, and net impact on boMom line need evalua6on and assessment for a successful transi6on
§ TCO: despite common assump6on of savings with cloud, there is not sufficient data on overall TCO . Newcomer cloud startups hardly provide a baseline or equal comparison for classic enterprises in terms of size, complexity and risk. Public and private cloud comparisons also lack sufficient detail for ABC (ac6vity based cost accoun6ng) or other applicable methods that can provide reliable cost per unit at enterprise scale
§ How fast: Not only this is linked to organiza6onal readiness and impact assessment, but also an understanding of the delta between enterprise current state and target state. This needs an assessment of addi6onal features, func6ons and capabili6es that public cloud (Google apps, AWS…) or cloud-‐in-‐a-‐box solu6ons lack because at the core they are purpose built DC’s and reaching target state on them takes 6me, resources and poses risks to manage including plaNorm specific limita6ons, licensing models and scenarios, applica6on and infra varia6ons, standardiza6on, SLA and contract management…
§ The business case for using u6lity compu6ng for specific enterprises and ver6cals. And regardless of who/where IT is run, uncertain6es need clarity against the level of defined risk thresholds
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Challenges of unknown and undefined
Level of IT maturity drives speed of cloud adop5on
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Enterprise adop5on of cloud requires a concerted due diligence and planning to understand delta between current and target state to define transi5on methodology and target architecture
Navigating uncertainty
Opportunity to counter risks: § Ever larger data volumes (Big Data ) coupled with intelligent analy6cs can combine to provide valuable
strategic and opera6onal informa6on from structured and ad hoc data.. § Virtualiza6on has been adopted to gain consolida6on; and o+en stagnant around 20% range due ton 6ght
coupling of apps and infrastructure. This barrier mi6gates gains in workload op6miza6on and consolida6on, and efficient cloud adop6on
§ This virtual barrier drives inefficiencies that o+en offset gains in server consolida6on and complicate cloud adop6on
§ API management that is mostly sta6c or yet to be sufficiently dynamic and interac6ve (intelligent) § Tools and so+ware from ERPs, ISVs and third par6es that topically address some of these concerns, cannot
overcome inability of server centric virtualiza6on to dynamically and elas6cally respond to the stack that sits above it
§ New business models, delivery mechanisms, elas6city and service offerings that cloud enables, create significant compe66ve opportuni6es; and considera6ons to counter threats, some6mes existen6al, for enterprises of significant size
§ Cloud has already claimed several casual6es ranging from online video entertainment, to retail and gaming. The pace of this shi+ is only accelera6ng
More than opera5onal dilemmas for the C suite
Motivating factors for Cloud adoption
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Cloud is cheap; public cloud is even cheaper § There is liMle, if any, generally available enterprise class detailed ABC (ac6vity based cos6ng) type or other
methods that clearly lay out the cost of various cloud op6ons and permuta6ons § Many enterprise applica6ons are not available as cloud based and when they become available the cost models
and TCOs are far from known or proven, in par6cular for larger more complex enterprises. These variables impact many components ranging from performance to licensing costs including virtualiza6on
§ Formula6ng new consumable services and capabili6es along with experimenta6on and tes6ng can be accomplished rather inexpensively and much faster via a cloud. This is inherently valuable to business. Procurement, licensing and related costs of doing this in house along with resource and management costs are reason enough to leverage a cloud solu6on, but cloud does not address costs beyond procurement and provisioning and brings concerns about various exposures that must be planned and designed for
§ Cloud has lowered barrier to entry; in terms of cost, quality, sophis6ca6on and then scaling. This is a significant risk to established enterprises par6cularly when offerings and services are not ‘tangible’ goods
§ The net value of cloud is in transforming an enterprise to a nimble, responsive, fast thinking en6ty able to redefine and morph its services in intelligent, elas6c and right-‐sized manner. The most challenging part is gehng it right based on architecture, structure and organiza6on impact. This is not something to be gained on the cheap. But given all the new possibili6es and unpredictable nature of global business make this a cri6cal strategic investment for any enterprise. All the promised cost efficiencies and gains of cloud can be realized by puhng in place the right enabling architecture first
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Facts vs. hype and theory
Cloud costs less?
As infrastructure becomes more intelligent and analy6cs enable beMer understanding of data, organiza6ons: § Shi+ focus even further to higher value ac6vity and closer to business § Understand themselves beMer § (Re)structure themselves beMer § be more responsive to their dynamic opera6ng environment § Manage through intelligent and Open API’s that facilitate service consump6on § Mobile First § Emergence of Security Proper design and implementa6on of intelligent plaNorms enables transi6on or organiza6ons from product centric to service centric. This cloud driven and enabled transi6on can help extract significant knowledge even from exis6ng data; to release value currently trapped inside constrained plaNorms & data models.
Drive data driven organiza5ons
Intelligent Platforms
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