getting your head in the clouds

Copyright 2009 Archistry Limited. All Rights Reserved.

Getting Your Head in the Clouds

Andrew S. TownleyFounder & Managing DirectorArchistry Limited22 September 2009

Public Information Copyright 2009 Archistry Limited. All Rights Reserved.

Introductions

SOA for E-Government2006

2007

2006

Adoption Forum 2006

Symposium 2007

2008

3 Public Information Copyright 2009 Archistry Limited. All Rights Reserved.

Agenda

■ What is cloud computing?

■ What matters to your organisation?

■ What value can you realise from the cloud?

■ What are the risks and challenges of the cloud?

■ How can you get into the cloud?


Agenda







via theInternet

Cloud Computing is...

Datacentre Hardware& Systems Software

Accessed anytime,anywhere

& on-demand

Applications Deliveredas Services

+


But, isn't that...

IaaS

SaaS

PaaS

Outsourcing

InternetIntegration

ManagedServices

ApplicationServiceProviders

ServiceCommercePlatform

ServiceOrientedArchitecture


But, isn't that...

IaaS

SaaS

PaaS

Outsourcing

InternetIntegration

ManagedServices

ApplicationServiceProviders

ServiceCommercePlatform

ServiceOrientedArchitecture

Oh, Hell...It's a technology thing, isn't it?


Not completely...

■ Organisational DNA changes required■ Not just an IT issue:

● Legal● Human Resources● Marketing & Sales● Research & Development● ...etc.

■ How you work with others

Oh, and that technology thing too...


What's the Point?

■ IT as a utility:● Inexpensive● Pay-as-you-go● Scalable availability● Self-service access● Ubiquitous access● Reliability

■ Capabilities & relationships

Focus on the core business


Why Now?

1 Illusion of on-demand, infinite resourceseliminates the need for long-term resource planning

2 No up-front commitmentsstart small and increase consumption as necessary

3 Pay-per-use for short-term needsdrives efficiency and conservation of resources


Alphabet Soup

■ SaaS – software as a service

■ PaaS – platform as a service

■ IaaS – infrastructure as a service● Software infrastructure● Hardware infrastructure


Cloud Models

Image source: MWD Advisors, http://www.mwdadvisors.com/blog/2009/07/seven-elements-of-cloud-value-public-vs.html


Cloud Models

Image source: MWD Advisors, http://www.mwdadvisors.com/blog/2009/07/seven-elements-of-cloud-value-public-vs.html

Hybrid clouds blend both models to meet specific business needs


Cloud Caveats

Our definition

Is a “Private Cloud” really a cloud at all?


Agenda







Profitability

CO

ST

CO

ST

PR

OD

UC

TIO

NP

RO

DU

CT

ION

PR

ICE

SP

RIC

ES


Value Disciplines

OperationalExcellence

CustomerIntimacy

Product / ServiceLeadership

Adapted from “Customer Intimacy and Other Value Disciplines”, Harvard Business Review, Jan/Feb 1993 by Treacy and Wiersema


Value Disciplines

CustomerIntimacy

Product / ServiceLeadership

Adapted from “Customer Intimacy and Other Value Disciplines”, Harvard Business Review, Jan/Feb 1993 by Treacy and Wiersema


You've gotta do them all, but you can only focus on one!


The CEO's Agenda

Excerpted from The Conference Board's CEO Challenge 2007: Top 10 Challenges (http://www.conference-board.org/publications/describe.cfm?id=1362)Excerpted from The Conference Board's CEO Challenge 2008: Top 10 Challenges (http://www.conference-board.org/publications/describe.cfm?id=1569)

Excellence in execution

Sustained top-line growth

Consistent strategy execution

Profit growth

Talent management

Customer loyalty & retention

Speed, flexibility & adaptability

Corporate reputation

Innovation & creativity

Speed to market

Excellence in execution

Consistent strategy execution

Speed, flexibility & adaptability

Global economic performance

Financial risk (incl. liquidity)

Sustained top-line growth

Customer loyalty & retention

Improving productivity

Business confidence

Profit growth

1

2

3

4

5

6

7

8

9

10

2007 Survey 2008 SurveyOperations Customers Innovation


Your Execution Approach


Extends Stage 3

Business services

IT innovation

IT/Business feedback loop

Your EA Maturity Level

Based on research from MIT Sloan School’s Center for Information Research and IMD involving nearly 500 companies from 1995-2005

Local investments

Local structures

Local processes

Basic IT automation

High costs

Local IT automation

Start shared infrastructure

Start platform reduction

Technology & delivery standards

Lower costs

Enterprise view

Centralized data

Standardized interfaces

Reusable processes

Enterprise systems

Business Silos

StandardizedTechnology

Optimized Core

Business Modularity

SOA

Cloud


Agenda







It Depends on Who You Are

vs.

SME = 99.9%( > 16M )

of EU businesses LE = 0.1 % (~17,000)of EU businesses

Figures from ENSI - The European Network for SME Research (1994), European Observatory for SMEs: Second Annual Report, ENSI authors and publishers. The Netherlands.

Yearly technology spend:~ $100,000 - $400,000

Yearly technology spend:~ $2M - $50M+


SME Adoption Drivers

■ Cashflow and survival● Manage utilities and facilities costs● Economies of scale● Pay-as-you-go pricing

■ Avoid Microsoft licensing fees

■ “One stop shop” approach

■ Exposure as end-users


Enterprise – Costs

Human cost per server €500/yr~100 servers / admin

€0.25/yr~200,000 servers / admin

Internal IT Cloud

Network bandwidth costs $500/Mb $12/Mb

Storage costs $3.75/GB $0.10/GB

CAPEX investment for 18extra months of IT capacity

$4.3M $0


Enterprise – Productivity

■ On-demand compute resourcesOn-demand compute resources● Eli Lilly able to parallelize ~20M compute tasks/monthEli Lilly able to parallelize ~20M compute tasks/month● Significant decrease in cycle times to get resultsSignificant decrease in cycle times to get results

■ Dynamic collaboration environmentsDynamic collaboration environments● Support “anytime, anywhere” accessSupport “anytime, anywhere” access● Multi-user, realtime co-creation of deliverablesMulti-user, realtime co-creation of deliverables● No internal IT set-up time or costNo internal IT set-up time or cost


Mapping Value Disciplines

CustomerIntimacy

Significant cost reductionsApplication consolidationMature sales & marketing vendors


Streamlined & shared processesCost reductions

Product /Service

Leadership

Easier & quicker collaborationSupports more open innovationReduced time to market


Agenda







The Cloud Reality

Your AppsYour Apps@ time @ time ttYour AppsYour Apps@ time @ time t + nt + n

70% of IT execs rated cloudsecurity risks “very significant”


BCCIA Analysis Framework

■ Business Execution

■ Compliance

■ Confidentiality

■ Integrity

■ Availability


Business Execution Risks

■ Who guarantees the SLAs?

■ Will a “one size fits all” SLA work for me?

■ What happens if we don't pay our bill?

■ How much risk transparency provided?

■ Do we really own our data?

■ Will it be practical to switch providers?

■ Can I set maximum spend limits?


Compliance Risks

■ Where in the world is my app and data?

■ Can I limit sharing/scalability to certain localities?

■ What legal jurisdictions apply to my data?

■ Are we still compliant with all software licenses?

■ What happens when the vendor gets sued?

■ What does PCI in the cloud really mean?

■ What about HIPPA, SOX, BASEL II, etc.?


Confidentiality Risks

■ What other apps and orgs share infrastructure?

■ What transmission & storage controls possible?

■ Is my data classified appropriately for the cloud?

■ In what cases can the vendor share data?

■ Do the terms change after acquisition?

■ What happens if vendor goes bust?


Data Integrity Risks

■ What's my archive/restore plan?

■ How many copies of data will we have?

■ Where is the “master” data now?

■ Can we map all of the new data flows?

■ Will we know if cloud data has been modified?

■ What gets added to our data by the vendor?


Availability Risks

■ What happens in DoS/DDoS at vendor?

■ Do I know how much I can actually consume?

■ What isolation exists between customers?

■ How & when do upgrades/maintenance happen?

■ How do I measure/manage/throttle use?

■ Is the data model available?

■ Is it cost-prohibitive to get my data?


What Can You Do?

■ Policies are key● Services tied to classification levels● Integrate business & security planning

■ Vendor management● Be explicit in the details● Have a clear exit strategy● Understand liability

■ Incidents not just about you■ Have a strong federated IdM story


What Can You Do?

■ Policies are key● Services tied to classification levels● Integrate business & security planning

■ Vendor management● Be explicit in the details● Have a clear exit strategy● Understand liability

■ Incidents not just about you■ Have a strong federated IdM story

Above all: be flexible and prepared to adapt to new ways of thinking!


Agenda







Start Now!

■ What can you move in 3-6 months?● Understand what you have now● Identify what commodity services you have● Identify the services that add real business value

■ How can you leverage the cloud to innovate?● Examine the existing organizational structures● Plan to build future applications differently● Identify what can get you closer to your customers

■ How much altitude can you actually manage?


References

■ Armbrust, M, et al., Above the Clouds: A Berkeley View of Cloud Computing, http://d1smfj0g31qzek.cloudfront.net/abovetheclouds.pdf

■ Burton Group, Catalyst 2009 North America, Cloud Computing track, 2009-06-29.

■ Knorr, E, et al., “What cloud computing really means”, InfoWorld, 2008-04-07, http://www.infoworld.com/d/cloud-computing/what-cloud-computing-really-means-031

■ New Zealand Ministry of Economic Development, SMEs Internationally, Last update: 2007-07-30, http://www.med.govt.nz/templates/MultipageDocumentPage____3118.aspx

■ Preston, R., “Down to Business: Customers Fire A Few Shots at Cloud Computing”, Information Week, 2008-06-14, http://www.informationweek.com/news/services/data/showArticle.jhtml?articleID=208403766&pgno=2&queryText=&isPrev=

■ Ross, J.W., P. Weill, and D. C. Robertson. Enterprise Architecture as Strategy -- Creating a Foundation for Business Execution. Harvard Business School Press, Boston, MA, 2006.

■ Treacy, M., F. Wiersema, “Customer Intimacy and Other Value Disciplines,” Harvard Business Review, January/February 1993, pp. 84-93.

■ Urquhart, J., “The three routes to cloud computing's future”, cnet news, 2009-03-16, http://news.cnet.com/8301-19413_3-10196722-240.html

■ Weill, P., J.W. Ross. IT Governance: How Top Performers Manage IT Decision Rights for Superior Results. Harvard Business School Press, Boston, MA, 2004.

http://d1smfj0g31qzek.cloudfront.net/abovetheclouds.pdf

http://www.infoworld.com/d/cloud-computing/what-cloud-computing-really-means-031

http://www.med.govt.nz/templates/MultipageDocumentPage____3118.aspx

http://www.informationweek.com/news/services/data/showArticle.jhtml?articleID=208403766&pgno=2&queryText=&isPrev

http://news.cnet.com/8301-19413_3-10196722-240.html

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