Cloud // Infrastructure as a Service
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2/19/2014
10:06 AM
Jimit Arora
Jimit Arora
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Enterprise Cloud Adoption: 5 Hard Truths

Everest Group lead analyst Jimit Arora looks at five factors that can determine successful cloud adoption in the enterprise.

Last fall I had the honor of sitting on the selection committee for the inaugural ICE (Innovation in Cloud for Enterprise) Awards, sponsored by the Cloud Connect show and Everest Group. The experience taught me how large enterprises are adopting cloud computing in ways that are often compelling, sometimes surprising, and occasionally breathtaking.

The winner, Revlon, Inc., presented an impressive case for how it leverages cloud to achieve organizational transformation that boosts competitiveness and consumer wallet share.

As impressive as each individual entry was, there were five recurring themes that emerged across the enterprise cloud adoption stories we read. While certainly not scientific, they reflect what enterprises themselves report as important factors in the success of their cloud deployments.

1. Identify a compelling reason to step out of the comfort zone.
We've read about the importance of senior management buy-in to achieve success in cloud transformation. But what we found in the award entry submissions is that the truth is even starker: Senior management must believe that cloud adoption is critical to organizational survival.

The high-level driver might be one of the ethereal themes we read about in the tech press: Product or service differentiation, moving to market faster with new services, or getting closer to the customer through big data analysis. However, the visceral driver is always primal: We do this or we're going to suffer at the hands of our competitors.

2. Tackle business challenges before taking on cultural or technical issues.
Organizational issues are real, and organ rejection can kill a cloud project. But the successful enterprises we studied had to deal with another set of challenges first: the financial realities of procuring a new IT stack in an environment where resources are often severely constrained.

[What else can go wrong when moving to the cloud? Read Top 10 Cloud Fiascos.]

3. Follow a multi-year, phased adoption roadmap.
This may seem obvious, but it merits mentioning because it's a universal marker for success. Enterprises that have made cloud work for them mapped out a transformation agenda that in many cases spanned 3 to 5 years. And while they certainly took the time to test and validate each step, they started with real production workloads, not just dev/test. To be sure, these early workloads were non-critical, but they were live applications serving real customers inside the enterprise.

This is a good place to point out that successful enterprises don't view cloud as private or public. They understand that hybrid -- defined as the ability to move data and workloads to the infrastructure best suited to the business objective at that moment in time -- is a roadmap item. In other words, it's part of the long-term IT infrastructure evolution plan, and they're not jumping in with both feet. Yet.

4. Cloud is a way to simplify the IT stack.
Twenty years of enterprise IT has led to a proliferation of IT silos, often with each supporting a small number of applications in a dedicated stack. Since complexity consumes resources, IT professionals spend their time maintaining and troubleshooting a variety of environments.

Eliminating this inefficiency was a common goal of the successful entries we looked at. The winner, Revlon, undertook an aggressive simplification of its IT stack, resulting in one DNS/DHCP, one directory, one network, one SAN, one hypervisor, one server image, one desktop image and one management toolset. Its results were impressive.

5. View cloud through lens of agility, competitiveness, not cost.
This point should remind enterprises that the significant business benefits offered by the cloud are unlocked only when a transformational mindset is embraced. The decision to adopt cloud alone will not ensure the desired level of business impact. It is perhaps instructive that few of the enterprises submitting award entries mentioned cost reduction as a primary objective of their cloud efforts.

What's the takeaway in all this? Two things: Develop a coherent strategy and vision for your cloud adoption journey, with a well-defined set of end objectives. This should take into account the disparate needs of each business user segment. Then step back and view cloud as a complete solution rather than a collection of silos or platforms.

That's how the successful enterprises in the ICE Awards did it. Cloud objectives should transcend conventional considerations, cost reduction, and risk management. Instead, focus on the business value of the entire solution.

Engage with Oracle president Mark Hurd, NFL CIO Michelle McKenna-Doyle, General Motors CIO Randy Mott, Box founder Aaron Levie, UPMC CIO Dan Drawbaugh, GE Power CIO Jim Fowler, and other leaders of the Digital Business movement at the InformationWeek Conference and Elite 100 Awards Ceremony, to be held in conjunction with Interop in Las Vegas, March 31 to April 1, 2014. See the full agenda here.

Jimit Arora leads the IT Services research practice, focused on applications, infrastructure, cloud services, and next-generation IT. Jimit's does research on banking, financial services, insurance, and healthcare outsourcing. Before joining Everest in 2005, he managed client ... View Full Bio

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ben@thedatacave.com
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ben@thedatacave.com,
User Rank: Apprentice
3/4/2014 | 10:51:18 AM
Great points!
You make several points in this post, many of which we have heard regularly from potential clients we've met. I agree especially with #5, regarding the focus that so many people but on $$. It seems that almost every time, people we talk to primarily see the Cloud as a means to simply save money, and nothing more. While it defintiely does help with that, it can also help businesses to actually GROW as well, when there is smart planning involved...it's definitely a mindset shift that needs to take place, but when it does, it has amazing results.
Stratustician
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Stratustician,
User Rank: Ninja
2/22/2014 | 1:10:01 PM
Getting the Guys at the Top to Buy-In
You raise a good point about the importance of getting buy-in from the top.  Traditionally, IT seemed to be pushed as a bottom up approach.  "We need X" and then you push a business case upwards until hopefully finance signs off.  But with Cloud, since it's a transformation methodology that is really less about technology and more about changing the way your organizations creates value for customers, it really does need to be driven from the top down.  

I find often Chief Marketing Offices (CMOs) can be a great ally for this.  They are the ones with the constantly being cut budgets, the ones who are measured on whether the company hits its objectives, despite that it's really the Sales folks that drive the performance of the company (I could argue both ways, but traditionally strategy has come from Marketing, and so they are the folks with the most skin in the game).  If they are shown that they can do things more efficiently, effectively and using tools that aren't plagued by legacy back end systems that are constantly touted as "this is how we've always done things.", there could be significant backing for the CIO who is trying to tie his streamlining projects into how it will transform the company in a tangible way.  
Laurianne
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Laurianne,
User Rank: Author
2/19/2014 | 3:21:14 PM
Agility
I would agree that agility trumps cost as a gain with cloud services. As an IT leader, cloud services help you say "yes" more than "no." What was the last tech trend before cloud that offered this much of a speed-up for the business?
Charlie Babcock
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Charlie Babcock,
User Rank: Author
2/19/2014 | 12:41:20 PM
How not to hand ammunition to your cloud project critics
Internal opposition can stifle the construction of private cloud. "Organ rejection can kill a cloud project," acknowledges Arora, but he urges settling the was the project will be financied first. Good advice, or critics will have added ammunition.
Multicloud Infrastructure & Application Management
Multicloud Infrastructure & Application Management
Enterprise cloud adoption has evolved to the point where hybrid public/private cloud designs and use of multiple providers is common. Who among us has mastered provisioning resources in different clouds; allocating the right resources to each application; assigning applications to the "best" cloud provider based on performance or reliability requirements.
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