Enterprise Open Cloud Forum: The Cloud is Making it Rain

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The Cloud is “Making it Rain”! How to Maximize ROI with Cloud Computing

Presented By: Rackspace Enterprise Cloud Solutions

RACKSPACE® HOSTING | WWW.RACKSPACE.COM 2

Your Hosts

Rafat Shaheen Sr.IT Strategist Rackspace Enterprise Cloud Solutions

Stacy Williams Rackspace Director of Production Support

RACKSPACE® HOSTING | WWW.RACKSPACE.COM

What We Will Cover Today

How does cloud enable first mover advantage to maximize profits?

What are the Key Performance Indicators (KPIs) to measure your Return on Cloud?

Why does a flexible deployment model maximize your cloud ROI?

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A New Way of Thinking

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Virtualization is a TECHNOLOGY …

Cloud Computing is a BUSINESS MODEL


The Right Way to Think About Cloud Adoption

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BUSINESS BENEFIT

COST ONLY

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ROI: Different Points of View WHAT I CARE ABOUT…

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BOARD • Competitiveness • Brand • Market Capitalization

IT MANAGERS • Total Cost of Ownership • Project Costs, Risks,

Value • Key IT Metrics

CIO • IT Budget • Project Success • Justify Resources

BIZ UNIT EXECS • Business Revenue • Improving Productivity • Key Business Metrics

CEO / CFO • Financial Reports • Cash Flow • Competition


What Is Your Cost of NOT Going to CLOUD?

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HARD COSTS

SOFT COSTS

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Cost of Capital & Cash Flow

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CIOs are Fueling the Innovation Engine

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PROJECT BEEF JERKY

TIME 1 2 3 4 5 6 7 8 9 10 11 12

The CAPEX Financial Model

Approvals Provisioning Testing

CAPEX Expenditure

LAUNCH

FIXED Capacity

CAPA

CITY

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TIME 1 2 3 4 5 6 7 8 9 10 11 12

The CAPEX Financial Model

Approvals Provisioning Testing

CAPEX Expenditure

LAUNCH

FIXED Capacity

Under Provisioning: Degradation of Performance

Over Provisioning: Wasted Compute/Cost

CAPA

CITY

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PROJECT BEEF JERKY


CAPA

CITY

TIME

1 2 3 4 5 6 7 8 9 10 11 12

Cloud Financial Model

LAUNCH

DEMAND

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CAPA

CITY

TIME

1 2 3 4 5 6 7 8 9 10 11 12

Cloud Financial Model

LAUNCH

MAX

MIN

AVE USAGE

DEMAND CAPACITY

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Investigating Investment and Return COSTS & RISKS

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Investigating Investment and Return QUANTITATIVE & QUALITATIVE


Project-Based

It’s time to own your business.

“Understand your projects… provide greater organizational health”

• Real-time ROI Assessment

• Identify Star Performers

• Flexibility to Course Correct

ACCOUNTING

Have the insight to Pull the Plug!

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Cloud Enabled IT

• Understand characteristics & behaviors of projects

• Group similar usage patterns

• Establish assumptions & benchmarks

• Forecast Cloud OPEX Group C

Group B

Group A

Use Demand Patterns to Forecast and Plan

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Leverage a Hybrid Model Adaptive Deployment

Move projects to the most ROI rich environments.

YOUR DC DEDICATED/ MANAGED VIRTUALIZATION CLOUD

SERVICE PROVIDER Traditional IT

You Control MAXIMIZATON of ROI.

START HERE

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Justifying a Business Case

Return On Cloud, A Framework

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Rackspace Proprietary Information



Return On Cloud, A Framework

Obtain Current Metrics

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Return On Cloud, A Framework Identify Workloads


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Develop Success Criteria



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Cloud-Deploy Prioritized Projects



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Decide on ROI Period/Interest Rate



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Calculate Quantifiable Benefits



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Identify Qualitative Benefits









Document KPIs and Ratios



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Financial Instruments:

TCO, NPV, IRR, Pay Back Period







Calculate ROI with Supporting KPIs



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Maximize ROI (Refine Deployment Model)












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Maximize ROI (Refine Deployment Model)











Identify Next Project


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The Quantifiable Financials

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Rate of TCO Reduction

CapEx Vs. OpEx Savings

Improved Cash Flow

Supply Chain Cost

Reduction

Workload cost effeciency

CapEx/Cloud CapEx Ratio

OpEx/Cloud OpEx Ratio

ROTA/ROCE

NPV/Internal Rate of Return

Pay Back Period

Return on Investment


Cloud KPIs/Ratios Return on Cloud

Risk Management

Agility Core

Quality of Service

Revenue Improvement

Productivity Enhancement

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Time to Market and delivery

Rate of new projects

Level of automation

Transaction throughput and

latency

Rate of fulfilled requests

Risk Management

Agility Core

Quality of Service

Revenue Improvement


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Level of automation


latency


Time to profitability

Improved opportunity cost

Rate of margin improvement

Rate of revenue growth

Revenue efficiency

Risk Management

Agility Core

Quality of Service

Revenue Improvement


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Level of automation


latency






Revenue efficiency

Improved user satisfaction SLA error rate

Service response

optimization

Rate of labor reduction

Improved time to resolution

Risk Management

Agility Core

Quality of Service

Revenue Improvement


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Level of automation


latency






Revenue efficiency


Service response

optimization



Relative compliance risk

ratio

Cost of capital optimization

Operational risk reduction

Competitive growth rate

Business service

continuity

Risk Management

Agility Core

Quality of Service

Revenue Improvement


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Level of automation


latency






Revenue efficiency


Service response

optimization



Relative compliance risk

ratio

Cost of capital optimization

Operational risk reduction

Competitive growth rate

Business service

continuity

Time to deliver, implement, and

change

Rate of new products and

services

Market penetration rate

Rate of reuse/lock in

issues

Flexibility of deployment

Risk Management

Agility Core

Quality of Service

Revenue Improvement


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ROI Supporting Tools Partners examples

There are effective tools available for usage monitoring

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http://www.planforcloud.com/index.html�


IT Transformation Framework

IT Evolution Workshop

Application Profiling

Workshop

Cloud Readiness

Assessment

Design

Migration Services

Solution Online

Customer Data Center

Strategize & Assess Design Migrate Implement Support & Optimize

Step by step approach to adopting cloud

Governance Planning & Customer Maturity Evolution

POC Pilot

Architecture

We Will Get You There…

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Get SMART on Cloud

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“Our goal is to create the most

CLOUD SAVVY customers in the industry”

Use cases: – Hybrid Hosting: Dominos Pizza and watch the video – RackConnect™: VEVO and watch the video – Private Cloud: Lighthouse1 – Advisory Services: Acquity Group

Recommended Industry Resources: • The Big Switch, Nicholas Carr • Cloudonomics: The Business Value of Cloud

Computing, Joe Weinman

• Rackspace Cloud Tools Marketplace • http://gigaom.com/ • www.gartner.com

• www.forrester.com • www.idc.com

Rackspace Knowledge Center

JOIN US!

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http://www.rackspace.com/knowledge_center/search/site/lighthouse�

http://c1776742.cdn.cloudfiles.rackspacecloud.com/downloads/pdfs/Rackspace_Acquity_CaseStudy_web.pdf�

http://www.nicholasgcarr.com/bigswitch/�

http://www.cloudonomics.com/�

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https://cloudtools.rackspace.com/home�

http://gigaom.com/�

http://gigaom.com/�

http://www.gartner.com/�

http://www.forrester.com/�

http://www.idc.com/�

http://www.rackspace.com/blog/rackspace-named-2012-microsoft-hosting-partner-of-the-year/�

http://www.rackspace.com/knowledge_center/�

https://community.rackspace.com/�


What We Covered Today

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How does cloud enable first mover advantage to maximize profits?

What are the Key Performance Indicators (KPIs) to measure your Return on Cloud?

Why does a flexible deployment model maximize your cloud ROI?


Q & A

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1.This presentation outlines general information regarding our services and is for informational purposes only; all statements and information are provided “AS IS” and are presented without warranty of any kind, express or implied. Our product/services offerings are subject to change without notice.

2.Trademarks and Service Marks Rackspace® and Fanatical Support® are service marks of Rackspace US, Inc. registered in the United States and other countries. OpenStack and OpenStack design are trademarks of OpenStack, LLC. Other trademarks and tradenames appearing in this presentation are the property of their respective holders. We do not intend our use or display of other companies’ tradenames, trademarks, or service marks to imply a relationship with, or endorsement or sponsorship of us by, these other companies.

Enterprise Open Cloud Forum: The Cloud is Making it Rain

Technology

Transcript of Enterprise Open Cloud Forum: The Cloud is Making it Rain