As cloud computing becomes widely adopted, organizations still maintain vastly different schools of thought on what the term “cloud” really means. That’s partly due to the term “cloud computing” being used for a broad collection of services, delivered at many different layers (infrastructure, application platform, software, and business process), and implemented in a variety of different ways (public, private, hybrid, on-premises, and off-premises).
There’s a big difference between “cloud” for bottom-line improvement and “cloud” for top-line improvement; and they can be diametrically opposed strategies. Cloud does not have a single value proposition for all types of services or enterprises, and there are risks to those who ignore its many variations.
Explore Three Rationales for Doing Cloud Computing
Three perceptions of “cloud computing” dominate today and often drive enterprise IT strategies. Usually, the IT organization is focused on only one of these, to their peril:
It’s a way to save money. With this belief, cloud computing’s economies of scale will always win, and IT is a commodity. This abounds in “cloud first” (or worse, “cloud only”) strategies. The danger here is that cloud computing is not always cheaper. Services that can be effectively outsourced to “the cloud” to save money are often highly-standardized commodity services that have varied demand for infrastructure over time. The cost of retrofitting existing applications can sometimes be prohibitive. Standardization is required for cloud, and standardization can save money – but standardization has eluded enterprise IT for years in certain areas. Cloud computing doesn’t, by itself, make standardization easier to adopt.
Bottom line: Cloud computing can save money, but only for the right services.
It’s a way to renovate enterprise IT. The belief here is that cloud computing is an ideal form of computing, and that enterprise IT should change to adopt the learnings of the “cloud.” This is often expressed by enterprise IT organizations attempting to turn their entire infrastructure into a “private cloud.”
However, cloud computing, by definition, turns IT services into fast food. Not everything fits this style of IT service design and delivery. Not everything requires speed of deployment, or rapid scaling up or down. Not every IT service benefits from runtime automation. Some services are unique and run the same way, day in and day out, for years (and will struggle if the underlying service keeps changing). Some services require significant and unique enterprise differentiation and customization.
Bottom line: Enterprise IT can learn from cloud computing, and private cloud, when applied to the right services (that can’t be deployed to a public cloud provider), can drive the organization to more efficient and effective standards.
It’s a way to innovate and experiment. The belief here is that cloud computing is where innovation and start-ups are born. While this is certainly true, the low barrier to entry of cloud computing enables large enterprises to behave like start-ups for new services. Cloud computing makes it extremely easy to get started and to pilot new services. The challenge for enterprises is to enable innovation and experimentation, but to have a feasible path from pilots to production, and operational industrialization.
Bottom line: Cloud computing enables new forms of computing and can enable experimentation and short-running services like never before – but there is a balance between innovation anarchy, and long-term operational effectiveness and efficiency that need to be managed, just right.
In summary, cloud computing does not have a single value proposition for all enterprises and all services. A cloud computing strategy should include these three approaches and organizations must probe where they can benefit from cloud in various ways. This will help drive enterprise IT to a new core competency, away from solely being a provider of services, and toward being both a provider and a broker of services delivered in a variety of ways for a variety of business values – what we call Hybrid IT.