Getting Cloud Computing right


Few technologies have received as much hype in the past couple of years as Cloud Computing. Virtually every major IT provider such as Amazon, Google, HP, Intel and IBM is now aggressively promoting their new CC services. Despite the excitement, business adoption has been slow for mission-critical production applications within traditional large IT buyers like financial services, healthcare and manufacturing.

Simply defined, CC is a range of enterprise-level technologies that enable organizations to draw their computing power and data from a centrally managed internal or external pool of compute resources including servers and software licenses.  Acting like an electrical utility, a Cloud can supply users (Companies, operating units and individuals) computing resources as needed, when needed.  In an ideal situation, CC enables organizations to reduce or defer the purchase cost of expensive hardware and software assets, accelerate application performance at peak load periods and drive up overall IT utilization – which for most firms languishes at around 25% of potential capacity.  Importantly, CC also enables companies to move to a more flexible, scalable and efficient IT pay per usage model also known as Software-as-a-Service (SaaS).

CC and its predecessor Grid computing have been around for over 20 years.  If the Cloud is going to move beyond niche applications into the mainstream of business computing, it will need to overcome some important adoption challenges, as follows: 

Standards confusion

Although slowly emerging, there are still a plethora of competing standards that inhibit a quick and low risk adoption of CC.  For example, there are competing standards in the critical areas of IT infrastructure components, security, identity and system interfaces.  CIOs need to ensure their CC adoption plans and technologies are readily aligned with standards as they are set, even if they do not represent the best technology at this moment.  One simple step would be to follow the Open Data Center Alliance, an independent consortium comprised of leading global IT managers who seek to provide a unified vision for long-term data center requirements.

Organizational challenges

CC adoption continues to be stymied by (often hidden) organizational barriers such as who controls IT resources and how is IT linked to business priorities.  Furthermore, ongoing concerns around computing resource availability, external cloud viability and data privacy often make CC a difficult to sell to the business unit owners.  Because of its revolutionary nature, organizations must treat CC like it would any other transformational project.  This requires using change management methodologies, right sizing the organizational structure to reflect new mandates & roles and using pilot projects to build internal support and generate key learnings.  Gary Tyreman, CEO of Univa a leading Cloud Computing provider, says:  “While Cloud looks like an easy way out, one needs to begin by connecting the project to a strategic imperative, orderly define a starting point, identify low hanging fruit and create the white space for the team to make this happen.”

Market confusion

Given its short history, its no surprise that there is considerable market uncertainly and bewilderment over what is CC, how are solutions best deployed and who really can deliver on its promise.  In fact, almost every IT provider of consequence now promotes a CC and SaaS capability. This market clutter has created an adoption barrier for many firms. Despite this clutter, there are more than enough success stories for firm’s study.  “There is now a compelling business case for the Cloud and enough proven case studies across many industries to speed implementation and reduce business risk,” says Tyreman.    

Lack of IT transparency

Many CIOs lack sufficient visibility into their IT infrastructure and operating units to understand which business applications and cost centers represent the best opportunities to deploy CC.  One of the most important first steps to moving to the Cloud is to understand what IT assets firms have, how they are used and where is the cost (hardware, software and operating). 

Given its transformational value and record to date, CC is on the cusp of crossing the adoption chasm in 2011.  Although they need to do their homework, CIO’s should look deeper into how CC can reduce their cost and improve business performance.

For more information on our products and services, please visit the Quanta Consulting Inc. web site.

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5 comments so far

  1. [...] from security breaches at Amazon and Sony that impacted millions of users.  And, there remain important challenges to fully exploiting CC’s potential.  Not all first generation initiatives have met [...]

  2. [...] from security breaches at Amazon and Sony that impacted millions of users.  And there remain important challenges to fully exploiting CC’s potential.  Not all first generation initiatives have met [...]

  3. [...] fully leverage CC’s potential, IT managers will benefit from a better understanding of how companies are leveraging the cloud, what kind of financial returns are they seeing and what the organizational implications of these [...]

  4. [...] own subscription pricing schemes and buying other cloud offerings.  It’s more preferable – though not easy – to cannibalize your own business in a controlled manner than let someone else do it to you.  [...]

  5. [...] subscription pricing schemes and buying other cloud offerings.  It’s more preferable – though not easy – to cannibalize your own business in a controlled manner than let someone else do it to [...]


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