cloud strategy executive scorecard

7/30/2019 Cloud Strategy Executive Scorecard

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Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.

Cloud strategy starts

and ends from afinancial view of IT --

CABMark E. BradleyDecember 4-6, 2012

Session: CAB Strategy, Planning and Governance


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Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.2

The 0pportunity

Deliver

businessinnovation / growth

Cut costs andmanage budgets

well

Visibility

Resourceallocation

Investmentcapital

Maximize investment of company funresources to make a difference

Communicate IT value through IT spand baselines by business service, abusiness unit, and IT budget catego


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5.0%

3.3%

7.8% 9.5%

15.6%

22.7%

11.4%

11.4%

13.3%

What is your current IT financial baseline

Operations Spending

31.9%

63.5%

4.6%

New ITInvestments

Operations

& Support

Planning &Strategy

Data Ce

S/W

Source: Planning and Budgeting Best Practices Benchmark Survey

Total Spending

ApplicaMainte

End User Support

Security & ContinuityOutside Services

Network

Shared ServiceOther


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Why Cloud?

Main initiatives

- Cost Control

- Increased Business Demands- Market Disruptors- Heightened Customer Demands- Economic Impacts- Aid with Business Problem Solving- Governance, Regulation and Security- Advances in Technology (e.g., Cloud Solutions, etc.)

- Optimize IT- Manage Technology Disruptors- IT Performance and Responsiveness- Talent Management


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Why?

Evaluating cloud computing

Show how Cloud Computing adoption can benefit business, IT consumers an


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Source: Implementing Service & Support Management ProcPage:276

By Mark E. Bradley

Expectation/s

IT Services

Performance/$

Requestfor service

SLA SLA

s

di

Consume

rs

IT organization

Service

catalog

GoldSilverBronze

OptionsParametersLevels

OLA UC


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5 things you need to consider as you plan appro

Cloud

1. Pre-cloud planning and preparation laying the groundwork

strategy2. Understanding the types and styles of cloud computing IaaS

SaaS

3. The economics of cloud computing identifying the ROI and

benefits

4. Security and governance venturing into the wild, wild cloud

5. Storage in the cloud

ensuring access to your data


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3 Main As-A-Service Options


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Cloud performance evaluation and management landscape

Evaluating cloud computing

Infrastruc

a Service

PlatforServic

Sofas Se

Personas

Consumers of any asset delivered as a service Providers ofXaaS delivered from private/hybrid/public cloud

Main initiatives

Agility time to procure, provision any asset as a service

Utilization/Elasticity optimize cost of resource utilizationbased on demand

Risk and compliance

Operational versus capital expense

Cost management and flexibility


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Key Cloud Attributes & Source of Savings


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Why Nationwide went with Cloud

Nationwide Challenge -- It sought to increase its pace of innovation.

The problem: New environments were taking weeks or months to provision and deploy Current infrastructure was definitely stifling innovation

80 to 90 percent unused from a capacity standpoint -- grossly inefficient

Nationwide the solution turned out to be a private cloud -- created a multi-platform private of Linux virtualized servers optimized for the organizations different workloads

The payback: reduction in power, cooling, and floor space requirements by 80 percent and expenditure on its distributed server landscape, saving an estimated $15 million over the firMore importantly, since private cloud resources are virtualized, they could be provisioned, dmoved quickly, in minutes or hours rather than weeks or months


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Conclusions

A top down process of analysis and refinement, describing business

capabilities and matching cloud technologies Respect both the business and IT dimensions of an organization

Balances value and risk to identifying cloud opportunities while mitigthreats

Flexible, adaptable and reusable


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Thank you


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Back-up Slides


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IT Financial Mgt Common Measurements

IT Spend Ratio Discretionary vs. Non Discret Business & IT Service costs (e.g. CRM, Cloud,

Cost per business or IT transaction Business Unit Cost Allocations IT Organization Budget vs. Actuals

Application Total Cost of Ownership IT Cost Category Budget vs. Actuals

Creates Financial Insights to ImprovePerformance


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Difference between Capex & Opex

Capex: Funds used by a company to acquire or upgrade physical ass

property, industrial buildings, or equipment. IT hardware represents onorganizations largest capital investments.

Opex: Funds used to cover expenses related to the production of goservices. Operating expenses do not include taxes, debt service, or ot

inherent to the operation of a business but unrelated to production.

Ten years from now nobody will be talking about the cloud. It will just b

computing


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Continuously evaluate the performance of anything as a service

Executive Scorecard for the cloud

Utilization of network, storage, serverand applications

Automation (compliance, patches)

Information and data traffic privacyand security incidents

Vendor performance

Financial perspectives ofinfrastructure and applications(budget vs. plan etc.)Availability and SLA performance


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Having visibility into your environment is critical

Balancing demand & supply

Demand management

Finan

IT cost / budget

(Volume & price)IT FTEs

IT operating budget

IT demand drivers

Internal business

initiatives

Regulatory compliance

requirements

External market forces

IT co

strate

Susta

struct

Disc

Short

measIT demand management

Chargeback/cost allocation

Project portfolio

management

Service catalog

IT demand

(Quantity & quality)

Internal IT end users

External IT end users

Fi i l C t A t ti E l


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Financial Cost Automation Example

Stage 1

Facil i ty Costs

Project

Initiation

Project

Execution

Project

Comple

Stage 2

Power Costs

Stage 3

Secur i ty Costs

Sta

Labor

Calculate Linux Server Service Cost Scenario

Stage 1

Backup Costs

Project

Initiation

Project

Execution

Project

CompleStage 2

Patch Costs

Stage 3

DR Costs

Sta

Labo

Stage 1

Hardware Costs

Project

Initiation

Project

Execution

Project

CompleStage 2

Software Costs

Stage 3

Maint. Costs

Sta

Cost p

Calculate

Data Center

Host ing

Costs

Calculate

Managed

Serv ice

Costs

Calculate

Server

Costs


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Total Cost of Ownership Levers

Rapid elasticity

Provides ability to turn-on additional containers only when demand requires more capaci

Provides ability to turn-off under utilized containers and lower expense

Measured Service and Pay Per Use

No foundational infrastructure investment required

Possibly a minimal up-front registration investment

Only charged for usage (e.g. platform up-time, deployed application count, transaction co

Resource Pooling

Minimize usage cost by sharing and re-using resources

On-demand self-service

Create and provision platform without third party participation


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Total Cost of Ownership Advantage

Rapid elasticity

Containers shared across multiple tenants

Capacity managed per service, not per tenant

Single, flat container partition space enables maximum sharing

Containers may be partitioned by service

Resource Pooling

Application footprint lower than single tenant, dedicated containe

Lazy loading further minimizes footprint


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Total Cost of Ownership Advantage

Measured Service and Pay Per Use

Cloud infrastructure investment recaptured after 4 tenants subsctime usage per tenant)

Can meter and bill based on business transaction usage, applica

On-demand self-service

Application teams do not have to specify infrastructure topology (count)

Subscribe to application platform services instead of application sinstances

cloud strategy executive scorecard

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