Big Blue isn't just pitching cloud technology, it's migrating its own apps to a shared, virtualized infrastructure. CIO Jeannette Horan shares her lessons learned to date.
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IBM has promised to deliver earnings of $20 per share to stockowners by 2015. The public commitment puts pressure not just on revenue generators like salespeople and product specialists, it also has the company's IT management under the gun to reduce costs without hurting Big Blue's ability to operate and innovate on a global basis.
That's the pressure-cooker of a background against which newly-installed CIO Jeanette Horan is leading IBM through a transition that will see the company migrate the bulk of its critical systems to an internal cloud environment. "We have to drive down our cost of running IT," said Horan, at lunch event with reporters in New York City.
With that in mind, IBM is adopting a cloud-based version of its Cognos software for business analytics, and it's also putting the development and test center for its 5,000 internal applications in the cloud. In addition, the company is building out a storage cloud, and a desktop cloud that will ease its ability to bring on new workers no matter which part of the world they are based. The latter "is the next step" on IBM's cloud journey, said Horan, who was named CIO last month.
"Our strategy is primarily private cloud" for all deployments, she said, citing IBM's need for security and non-stop uptime.
Horan said that, despite the daunting nature of such a major IT redesign, there are some aggravation-saving methods that can help reduce the complications of a cloud migration--at IBM or any other company.
The first rule for ensuring a successful cloud migration has little to do with technology. Moving business departments that are used to managing their own technology fiefdoms onto a common, corporate-wide cloud environment "raises cultural issues," said Horan. "You've got to get them to give up control."
That leads directly to a second step that can help remove those cultural pain points. IT itself can set the example by moving its own operations to the cloud. As a vendor that sells cloud solutions to other companies, IBM's internal move to the cloud exemplifies the thinking behind this on an organization-wide basis. "You've got to walk the talk," said Horan, who noted that IBM CEO Sam Palmisano is a big backer of the company's cloud push.
Third, a cloud migration can proceed much more quickly and smoothly once a common platform has been decided upon and apps are migrated to that platform. For IBM, that's its own ZLinux environment.
Fourth, cloud migrations "should start small and grow," said Horan. That is, cloud models should be implemented starting with small departments or workgroups. Once the architecture is proven and accepted, it can be expanded throughout the organization.
Finally, IT leaders must "demonstrate the cost advantage" of moving to the cloud. For Horan, it's more than just rough numbers. She's got specific targets to meet to fulfill her part in getting IBM to its $20 per share goal. (The company is currently on pace to post EPS of $13.22 for 2011, according to analysts' estimates.) Proving cloud economies and linking them to larger corporate financial objectives will help ensure CEO buy in, said Horan.
Horan said IBM's cloud migration is proceeding on schedule, and that the company has seen cost reductions of between 5% and 10% in many areas of IT where cloud has been applied. But she conceded the real heavy lifting lies ahead, when more mission-critical systems will go to the cloud. "We've already done most of the easy things," she said.
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