November 19 - Day 3: Evaluating Where Cloud Can Save -- Even Make -- You Money - InformationWeek

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November 19 - Day 3: Evaluating Where Cloud Can Save -- Even Make -- You Money
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Thanks Jonathan! Looking forward to tomorrow's chat!

Apprentice

Thanks for the great questions. I will hope to see you all tomorrow for "The Cloud Broker Role!" Have a great rest of your day. --JF

Ninja

My understanding is that the up time is very slow, so depending on how much transactional data you have and the frequency of those transactions, it might miss some stuff.

Apprentice

Ok, y'all, thanks for coming today!

Ninja

I was going to post the URL then I remembered the dreaded anti-spam bot. Just search the web for "amazon glacier FAQ" ;)

Ninja

However, I just looked at the Glacier FAQ and apparently the recovery time is measured in hours. So, if that's ok with your business and you can find a cloud DR app that supports it, that works.

Ninja

Yes, it's very very slow. 

Apprentice

Which might make it a problem.

Ninja

Wendy, my immediate answer on the Glacier without looking is that I seem to recall that Glacier has a pretty long (relatively) recovery time to put something back into S3.

Ninja

That is big, especially in Gov. No offense.

Author

That's a pretty darn big shift!

Ninja

Thinking about super small mom and pop shops, would you recommend slower DR like Amazon Glacier to keep costs down? 

Apprentice

But, our technical services manager recently contacted our audit firm because we want to protect our ERP with our cloud DR solution, and they were fine with it.

Ninja

I know this has been a big problem in the past.

Author

I remember talking to a financial auditor over a year ago and she looked at me blankly when I mentioned cloud computing.

Ninja

YES. Great question, Lorna!

Ninja

Have you seen an attitude shift with auditors?

Author

I still think that most people are going to do the ROI calc for cloud disaster recovery, today.

Ninja

Wendy, re ROI: it's complicated. Do people do ROI calculations on VoIP anymore? Probably not, right? I think as the market for XYZ matures, the need for complex ROI or risk/benefit calculations drops.

Ninja

Lorna, I agree with you. A year ago it was really hard to convince anybody it was a good idea. Nowadays, I think most of the major players are offering a solution and people are really starting to adopt.

Ninja

@Lorna, re hybrid cloud: Yes. I think I mentioned yesterday that we have an ISV that acquired our SaaS vendor; in this case, the ISV offers as "cloud"(really hosted) offering at least 4x the cost, but they offer a more affordable premises solution.

Ninja

@Wendy, I think DR in the cloud has reached the point where it's obviously better and cheaper.

Author

This is a complicated question but do you think most people are actually calcing out the disaster recovery ROI? I just saw a survey that said less than 20% of IT directors were going through the effort. Is that short-sighted?

Apprentice

I know there are two schools on hybrid cloud. Do you think there are cases where keeping at least part of the cloud internal is the best way to save?

Author

How could a generic IaaS spreadsheet address all of the factors in the disaster recovery use case? Answer: it couldn't.

Ninja

... but as you can see, sometimes the use cases are complicated and require "customization" to really understand all of the factors, and therefore a "generic" ROI spreadsheet is not helpful.

Ninja

@Lorna, the "who are you laying off" phrase is THE way to put a stop to that nonsense. ;)

Ninja

Plus, Lorna, there are so many factors in whether (for example) IaaS is a good fit. If the APPLICATION running on IaaS can scale itself down to 1 or 2 micro-instances while it's not being heavily used, and scale up to 20 instances when it's under demand, IaaS will likely pay for itself. BUT, for static apps that don't know how to create or destroy cloud instances, you're going to have to "over-rent" a big set of instances, and then you'll be overpaying. (Because the instances will be running all the time and sized for peak loads.)

Ninja

I hate to say this, but I really think that vendor ROI sheets are created by marketing people and not actual IT people. Some discussions I've had with vendors.... let's just say that they belong in the fiction section rather than the non-fiction section of the library. Perhaps even science fiction section. 

Apprentice

Yes, you've mentioned the "who are you laying off" point before.

Author

Wendy, when it comes to overcoming emotion, I think you just have to be a little patient and keep asking "why". Eventually the facts will assert themselves. But being patient is very hard when you are trying for speed to market.

Ninja

I admit I don't often get pitched by cloud vendors, but I am intrigued by the idea of them pitching their value proposition as paying for themselves, the way the parking app does.

 

Author

One example: one of the vendor sheets gives servers a two year lifecycle. That's nonsense; nobody replaces server hardware every two years! (Except for VERY compute-intensive apps). Other sheets make the mistake of equating soft cost savings and representing them as hard costs. (Who are you laying off?)

Ninja

Lorna, I am very ... cynical ... about how accurate the vendor ROI spreadsheets are.

Ninja

Agreed, those preconcieved notions are totally overriding so many decisions and people don't even realize it. Kind of awesome from a psychological perspective, but troublesome when trying to cut through those paradigms from a leadership perspective. Jonathan, how do you really set those emotional factors straight? 

Apprentice

One question that I always get is "will I still have a job?" My answer is the only honest one for ANYBODY: as long as we continue to contribute value in some way, we will.

Ninja

What's really fascinating to me is how many "irrational" / emotional factors are present in a what is a very "fact based" profession (infrastructure).

Ninja

Agreed wholeheartedly on automating processes. That's another fallacy -- people are worried, as Lorna says, that they'll be eliminated by automation, and frequently point out the rare scenarios where the automation won't work. It's the 80/20 rule... if it covers 80% of the situations, probably time to automate. 

Apprentice

Cloud vendors also offer TCO worksheets. Have you ever used these?

Author

Wendy, I love that! I'm stealing that phrase. :)

Ninja

Wendy, indeed. That's another reason why automation is so very important. Automated processes aren't as prone to human failure. And when failure is not an option... why would you rely on manual processes?!

Ninja

Ah yes, I think that's called something like the gambler's fallacy, where you're more likely to keep throwing money after a bad idea because you think it's going to work out eventually.

Apprentice

@Lorna, you're right. Incumbency loyalty is really, really preventing a lot of innovation from happening. :(

Ninja

And, loyalty to incumbent vendors.

Author

I guess in terms of agility, I was thinking the ability to recover very quickly after a disaster.. failure to bring things back to bright in the right (or wrong) business? You're on the news. 

Apprentice

@CherianV300, yeah, Lorna's right, there's an irrational loyalty to sunk costs (costs already spent) sometimes.

Ninja

CherianV300, I think that's true. The leader's role in this case is to firmly redirect the conversation back to the facts. But your point about "what cannot be achieved with other infrastructure choices" is also true.

Ninja

Ahm @Cherian, the sunk costs. We already own all these servers, so ...

Author

In terms of "other", just about every SaaS CRM claims to enhance revenue.

Ninja

The problem is most discussion tends to be not fact based, and more a question around what cannot be achieved with existing Infrastrucutre choices

 

Apprentice

BTW, we used a very similar (but less formal) approach to the parking app in terms of decision matrix.

Ninja

Lorna, yes, the parking app DEFINITELY makes the organization money. To reiterate from yesterday, my slides say over 6% increase in revenue. However, after my slides were sent, I learned that our more recent numbers reveal a 10% increase. Wow...

Ninja

My staff is used to seeing me as having divided loyalty... which I think is an honest way to be when you are the CIO. Your FIRST responsibility is to the business; the SECOND (and still very important) loyalty is to staff. But both are very important.

Ninja

In terms of cloud making the org money, yesterday you discussed your parking app. I am assuming that the revenue increase more than offsets the cost. Do you have other examples you've hear of?

Author

Wendy, I definitely think that agility is a HUGE part of it, BUT... BUT... the challenge that I would make is that you must DEFINE what agility means to the business! Does it mean quicker customer order turnaround? Does it mean (in our case) the ability to launch a DR test whenever we want?

Ninja

Hi CherianV300, I hope that the security discussion (fact-based, not emotion-based) starts to answer your "internal politics" question. If not, please dig in and ask more. :)

Ninja

Jonathan, do you have any thoughts on "return on agility" for DR? Where does agility come into the equation? 

Apprentice

Seems like the big question is how do you overcome politics WHEN TCO/ROI DON'T OVERCOME THE PUSHBACK! Your staff may well see you as a traitor!

Author

Howdy all! Hope you enjoyed the audio portion. :)

Ninja

DR isn't even a question... I can't imagine anyone seriously not covering their bases here, but this decision matrix can definitely help to see the "Wow, I didn't even consider that" element of the process. 

Apprentice

DR really is a no-brainer.

Author

IS the Microsoft Cloud solution on the presentation Azure

Apprentice

CIO = All of the Above!

Apprentice

Automation ... it's a wonderful thing.

Author

@Cherian, do you have the slide deck? There's a matrix in there. We also have several reports just on cloud ROI modeling:

http://reports.informationweek.com/abstract/5/8702/Cloud-Computing/Research:-Cloud-ROI-Calculations.html

http://reports.informationweek.com/abstract/5/8678/Cloud-Computing/2012-InformationWeek-Cloud-ROI-Modeler.html

The second one lets you compare vs. in-house. The first one has research and is by Jonathan!

 

Author

How do we overcome the internal polictics and get the facts on the ROI, to justify the shoft to Cloud?

Apprentice

... you're rarely disappointed (when you're a catastrophic thinker)

Author

Excellent point, Lorna. It makes sense not to keep all your eggs in one basket, one would think.

Apprentice

Seems like it's in IT's best interests to support a varied vendor ecosystem. Let's not build another Cisco.

Author

Hi All! Excited to hear today's session. In my mind, I'm calling it "Show me the money!"

Apprentice

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

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

Hello everyone! I will be focused away from the live chat during the show, but Curt will be watching, so if you have a question, shout it out here. I'm happy to answer questions during the voice portion.

Ninja

We'd love to have your voice in the 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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