November 17 - Day 1: Cloud's Business Benefits: How Cloud Services Actually Affect the Balance Sheet - InformationWeek

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November 17 - Day 1: Cloud’s Business Benefits: How Cloud Services Actually Affect the Balance Sheet
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Thanks for being with us, everyone -- we'll look forward to seeing you in class tomorrow!

Strategist

Great chat session! Thanks for hosting it. Have a nice day everyone.

Ninja

Enjoy the rest of the day! And thanks for the great questions. See you soon.

Ninja

Thanks for the great discussion everyone!

Apprentice

Great point... best to speak the same language when going head to head with the chief revenue officer.

Apprentice

Looking forward to seeing you all tomorrow.

Ninja

However, as I mentioned, sometimes it's not about the hard cash flows. Clearly, when the cash flows work, and there is business value, then you flip the switch. But sometimes it's not so obvious.

Ninja

@Wendy, I think that cash flow analysis is THE way to do it. It's the most credible methodology that you can bring to the table when it comes to crediblility with Finance.

Ninja

I love the parking solution. I've traveled to other municipalities that have something similar in use and it's a tremendous relief.

Apprentice

@Wendy, great accounting question.

Ninja

@CherianV300, yes, 2:00ET every day despite what I said in error on Twitter! :-D

Ninja

@Lorna, re PaaS, the trouble is that the real cloud users are DEV, not infrastructure people!

Ninja

Perfect, are they at the same time, 2:00 EST

Apprentice

@Brian.Dean, thanks, I hope so. :)

Ninja

I mean, the parking solution is fairly obvious: not a lot of up-front cost, delight customers, parking revenue goes up... no heavy lifting needed.

Ninja

speaking of cash flow analysis (and you may be covering this in a future discussion) what ways do you use to measure cloud ROI? 

Apprentice

PaaS still seems a bit underbaked to me, unless you have lots of dev skills on staff

Author

@jfeldman, that will also be a great class.

Ninja

@CherianV300, in day 3, I'll show you a decision matrix that I think is useful for more complicated cases.

Ninja

@CherianV300, I would recommend doing a cash flow analysis FIRST.

Ninja

@Jfeldman oooh, looking forward to it!

Apprentice

@Wendy, later in this series, we'll talk about a use case for which it didn't make sense for us to move to SaaS because the costs to do it in house were so low.

Ninja

What crietrias do I apply to determine if SAAS, PAAS or IAAS is the appropriate chice to make?

 

Apprentice

@Brian.Dean, yes, I think that a market segment of SaaS cost savings would be a more meaningful metric.

Ninja

@Lorna, I think you need to have hosts (not guests) in the 100s for it to start making sense. That's not to say that people don't "cloudwash" their buckets of virtualization and call it private cloud... but unless it's automated and responds to an API call, it's not really cloud.

Ninja

Those are good point. I was thinking that maybe for CRM, average savings might have been calculated for example.

Ninja

@Brian.Dean, also, I wouldn't be so quick to say that SaaS costs less all of the time. We are in the  middle of considering a switch from one SaaS to another, and it's 4x the cost, and it's making us think about hosting it internally. Still haven't finished analysis, but that's how it's looking so far.

Ninja

YOu said private clouds aren't viable for smaller orgs. At what size do you think it starts making sense?

Author

@Brian wouldn't that be really dependent upon the application and existing hardware in place? I've seen some instances where it actually made sense to just keep it in house (mostly because someone had gotten crazy with budgetary spends the previous year, so hardware was just sitting there unused). Of course that's certainly an outlier.

Apprentice

@Lorna, I wish I could "like" that "move on" comment. :)

 

Ninja

Hi @Brian.Dean, great to see you here. I think the SaaS savings vary too widely for an arithmetic mean to have much value, but that's one guy's opinion. ;)

Ninja

Agreed re perimeter. There isn't one now. Move on.

Author

Oooh, good point. I'm fascinated by the concept of IT going back to original paradigms, especially given how much disruption there is in the marketplace in terms of technological advances. Whenever someone points out that "it's like we used to do it, only with a different name" I always perk up.

Apprentice

Lorna, I think that our board is happy that we can respond quickly. I presume that they're happy that our budget is 1.75% of organizational spend, and our cloud computing efforts are definitely a part of that.

Ninja

SaaS will cost less than in-house, has there been any research conducted that gives out an average figure for the percentage saved?

Ninja

@Wendy, it depends upon how it is set up. For example, our disaster recovery servers are behind an IaaS firewall that only allows logins from specified locations. FWIW, I think designing for no perimeter makes for better overall security anyway. Depending upon the perimeter makes it easier for an insider to do damage. Right?

Ninja

What reaction do you get from your "bosses" on the council about using more cloud vs. adding staff?

Author

I've seen a claim that the move to cloud is forcing IT back into the old security mindset we used to have in the 90's, the way we lived before everyone had firewalls. You now have your server on an exposed domain and anyone can create a log in... is that accurate?

Apprentice

Re competitive market space and IaaS, each provider wants to lock customers in. So they offer goodies that are easy to use but that make your code break if you move it off their service. (are you dependent on the AWS DNS service? Etc.)

Ninja

And, our provider has more fault tolerance than we could afford for that system because of their scale.

Ninja

But, that same backhoe could take out our Internet service, and we could use an alternative service (or, heck, a mobile phone) to launch a call.

Ninja

Think about it: one backhoe could have ruined our day / week when we had it on premises.

Ninja

@Lorna, I believe Joe Emison had a really great webinar on IW for breaking up with Oracle. Maybe something like "How to break up with your cloud provider"? I'd watch that! ("Dear AWS, it's not you, it's us....")

Apprentice

@Lorna, I actually worry LESS about emergency callout being down that I used to.

Ninja

@Wendy, TOTALLY. "We just got everything hunky dory and you want to do WHAT?" :)

Ninja

That's pretty mission-critical stuff

Author

Having survived several "blow it up" campaigns in IT, I can understand why people might freak out just a little bit.

Apprentice

OTOH, the contenders are playing catch up with mindshare and skill set building.

Ninja

Re "aws slipping," it's undeniable that they USED to have close to a 100% so of course as other competitive offerings come into play, they do slip.

Ninja

With emergency callout, do you worry about the SaaS service going down? Not that an internal service is bulletproof, but ...

Author

But -- I think the real challenges are the normal ones. Documentation, coordination, ...

Ninja

I sense a workshop there ... something about architecting for an exit strategy

Author

@wendy, re ops challenges, I think they're largely cultural. Traditional infra people feel like only recently is everything humming along great with virtualization mgmt, now we're going to BLOW IT UP AND MOVE IT TO THE CLOUD??? What, are you nuts? ;)

Ninja

@Lorna, re: "have you heard of anyone actually moving a ton of data?" for our disaster recovery project, as I recall, we moved on the order of half a terabyte...

Ninja

I just saw a market report that shows AWS slipping a bit. IBM's & MS' message about bare bones vs. value add seems to be sticking

Author

@lorna, sure, but there's no merit in "owning". The question is "what business value are we delivering?" In the case of emergency callout, not much.

Ninja

... and the point of using cloud and devops is that you can be agile enough to switch providers IF you plan right.

Ninja

What kinds of operational challenges might a smaller organization encounter as they start deploying to public cloud? 

Apprentice

AWS is clearly the 800 pound gorilla but there is good and healthy competition happening.

Ninja

I think that it is a very healthy market right now. The Day 3 slides show some market trends.

 

Ninja

With the owned strategy, you had some equity though, right? In servers that can presumably last a while, and in skills development.

Author

(that might be going a little off field for this discussion and that's okay too)

 

Apprentice

I'd actually be curious to know your feelings on AWS versus Azure -- they keep lowering the prices and I wonder if SMBs will be lured into creating private clouds, not fully understanding the cost creep that can occur when they have projects that go out of control.

Apprentice

We actually have a contractual stipulation about data ownership.

Ninja

Everyone worries about portability, but have you heard of anyone actually moving a ton of data?

Author

We have changed SaaS vendors twice with the emergency call out vendor.

Ninja

Lorna, to your point about substantial line item: marketing classes teach that you don't charge someone on a cost basis, you charge them for value delivered, e.g. AS HIGH AS THE MARKET WILL BEAR, ... LOL. But, if you're still saving money, it's a good thing.

Ninja

I am interested in finding case studies of IT shops that actually did fire a cloud vendor.

Author

IT knows about data portability (or lack thereof). IT can vet the level of security; the level of availability, and so on.

Ninja

Wendy, lock in is a vendor's favorite thing. That's EXACTLY why IT needs to be part of the conversation!

Ninja

Well hello again, all!

Ninja

Thinking about smaller businesses trying to be agile, what kind of vendor lock in is out there for PaaS and IaaS solutions? What's the norm?

Apprentice

And, if you cite manpower savings, who is being laid off?

Author

Not insubstantial at all - 25% reduction.

Author

You just can't write that kind of scenario. No one would believe it! Brilliant example. 

Apprentice

You couldn't have planned a more illustrative problem! 

Author

@CherianV300, are you not seeing/hearing the player? If that's the problem, then please try refreshing your browser window. That will solve the problem much of the time...

Strategist

Cherian, What browser are you using?

Author

Interesting point about private cloud benefits not being recognized by smaller and midmarket companies. I've always suspected as much but so much cloud brouhaha says otherwise.

Apprentice

Cannot get through on the registered session !!!

 

Apprentice

Ashville is one of the happiest cities in the U.S. I suspect this convenient parking system is part of that rating.

Apprentice

Gingerbread house competition going on now!

Author

So SaaS is less, but it's still a substantial line item.

Author

@tony.castellano  - trying refreshing your browser. What browser are you using? Chrome and Firefox work best

 

Apprentice

I am also on Chrome, so maybe that's why mine has been issue-free

Apprentice

Hi Tony, Yes, it has, but I had to go to Chrome.

Author

Tony, it definitely has started. Maybe refresh?

Apprentice

No player is showing.  Has this session started yet??

 

Apprentice

I haven't gotten any messages about errors and it sounds loud and clear on my end.

Apprentice

Good Afternoon Everyone!

Ninja

Hi all -Audio is live! If you don't see the audio bar at the top of the screen, please refresh your browser. It may take a couple tries. When you see the audio bar, if it doesn't start automatically, hit the play button. If you experience audio interruptions and are using IE, try using FF or Chrome as your browser. Many people experience issues with IE. Also, make sure your flash player is updated with the current version. Some companies block live audio streams, so if that is the case for your company, the class will be archived on this page immediately following the class and you can listen then. People don't experience any issues with the audio for the archived version.

Apprentice

@Lorna, my player is working well, though I had to refresh my browser window once to get it going. 

Strategist

Hi All! I got a message from FF about a plug-in issue. Anyone else?

 

Author

Really looking forward to this discussion! 

Apprentice

We'd love to have your voice in the class discussion here. To take part, just type your comment or question into the "Your Post" box and then click on the "Post" button below the box. Feel free to introduce yourself before the class starts -- I think you'll find that we're a very friendly community here! 

Strategist

Hey, everyone, we're glad you could join us! When the class is scheduled to start, at 2:00 p.m. EST, an audio player should appear above the "Your Post" window. If it doesn't appear, you might need to refresh your browser until it does. If it appears but doesn't start playing, then you may need to click on the "play" button on the far left of the player. 

Strategist


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