Experts suggest that Vijay Sahai should establish a strategic direction beginning with low risk applications on cloud
- 1) N Jayantha Prabhu, CTO, Essar Group
2) Vinod Sivaramakrishnan, CIO, Walmart India
3) Dheeraj Sinha, Head- Global IT and Supply Chain, Apollo Tyres
Will Vijay Sahai be able to muster the confidence to move all his enterprise applications to cloud? I am sure most IT heads face a similar dilemma - in making key decisions around moving critical applications to cloud. Vijay Sahai, Senior Manager-IT of a large automobile manufacturing firm finds his cost of infrastructure maintenance (both applications, hardware and software) soaring. The company, which has a large network with offices spread out across various locations and caters to multinational customers runs umpteen applications. With multiple users of these applications, it is a Herculean task for Sahai to keep tabs and ensure security. Since the company owns a huge captive data centre, Sahais challenges know no bounds. After much debate, Sahai managed to convince his conservative top management to opt for cloud model as a corporate strategy. However, scepticism around cloud prevailed and with much hesitation, a private cloud was created. But Sahai is still not convinced and wants his entire enterprise applications to move into the real cloud model.
The industry is abuzz with various cloud models and their testimonials. Large application vendors too make tall claims about their cloud offerings around various business critical applications. There are SaaS, PaaS, IaaS and hybrid models trying to invade the market. Sahai is completely bowled over by the cloud concept,cloud offerings and their advantages. On the one hand, he is tempted to move all his business critical applications to the cloud and relax; on the other, he is clueless about the intricate challenges and risks involved as there are no proven standards around cloud model.
While cost saving is one aspect, security is a key parameter he cannot ignore. Senior colleagues in the industry have yet another perspective:large enterprises should not opt for public cloud as there are several risks and shortcomings with regard to handling data or information. Therefore, he seeks answers from experts on two big questions; these will help him make the right decision.
THE BIG QUESTIONS
- Which cloud model do you think Vijay Sahai should consider at this point of time?
- Which of the applications should he consider moving to the cloud (which fits best) model?
- What is the approach he should take withcloud strategy? For instance, should he go in for a cloud service provider?
- How does he address security issues and what kind of benefits should he expect for the cloud model?
N Jayantha Prabhu, CTO, Essar Group
Principal owner of ESSAR Group Enterprise Architecture Board-IT Infrastructure & Technology; acting as Chairman, Technology Committee. Heads the ITCenterofExcellence
Evaluate Insourcing and Outsourcing Needs
Cloud-based service delivery will empower enterprises to simplify their infrastructure and potentially reduce costs via standardised platforms, combined with new skills and management practices.
The current challenge is to develop a cloud-services decision matrix to determine where to leverage the cloud. It is important to know which is the right solution for yourorganisations unique needs and circumstances. When choosing applications to migrate to a cloud model, you need to find the right balance between value and risk. You need to figure out where various applications and/or business functions fit in the Cloud Services Decision Gridand where they dont.
We recommend that Sahai assess service portfolios, identifying those services that are core to the business versus those that are commodity, and matching that against the corresponding delivery mechanism of Insourcing versus Outsourcing.
As a first step, it is advisable to plunge into public cloud model and take a cautious approach: initially choose a few least critical applications to host on public cloud as well as migrate server from physical to virtual to observe application portability, performance, security concerns, the next phase of applications to be included and cost analysis.
There are many benefits offered by cloud-based services such as increased scalability, flexibility, availability and productivity. For maximum benefit from migration to the cloud, it is essential that organisations develop a cloud strategy which takes into consideration commercial and technical concerns.
Based on our experience and knowledge, I recommend a 3-pronged cloud strategy:
a) Establish strategic directionthis begins with low risk applications or pilots and draws lessons for the future. This requires assessment of suitable business needs, triggers and timing, considering financial impacts and organisational capability, while managing change and reviewing governance
b) Implement a cloud solution as a structured projectbuild a business model, assess the risks, capture functionality, standards, and performance, manageability, security and compliance requirements, while preparing an exit plan.
c) Review the implementation by conducting a post-implementation review after implementation to:
- Undertake periodic risk assessments
- Confirm the benefits
- Capture lessons learned
- Prioritise any new business changes
To address the security challenge, I suggest putting a risk-mitigation strategy firmly in place, while performing due diligence checks in evaluating cloud security. Determine data privacy policies and data retention policies and be sensitive to latency considerations. Key business benefits would be a low start-up cost, reduced Opex/Capex expenditure, reduced data centre cost and complexity. This allows IT operations teams to focus on production uptime, increase application quality and predictability, achieve superior scalability, enhanced information security as all data lies on the server, and a secured client operating environment. Expert resources can now focus on key tasks and initiatives.
Vinod Sivaramakrishnan, CIO, Walmart India
Experienced business information technology executive with over 16 years experience in all aspects of IT, with cross-functional knowledge in finance and risk management.
Experiential Evidence is Key to Cloud
If Sahai intends to move forward on the journey to the real cloud, he should certainly look at a hybrid cloud model. His own personal conviction of the concept notwithstanding, there has to be solid financial and experiential evidence that the private cloud already implemented has resulted in specific maintenance cost savings, while maintaining the service levels that his multinational customers and offices experience. If there is no such evidence, at least directionally, he has no case.
Unless he is in a position that requires drastic cuts, his purpose is best served by evaluating on a case by case, area by area basis as to what the level of comfort is with moving the data and applications out of his environment to the real cloud, and what the risks are versus the verifiable cost benefits of taking those systems out. Then he will need to create a project plan that gradually moves out these applications and data, ensuring at each stage that the benefits are realised and that there are no significant operational or security issues, before going on to the next area.
When it comes to core applications and data that differentiates his company from others, he will have to tread very carefully. Despite the short or medium term financial advantages he may obtain from moving these to the real cloud, the risks from a strategic and business perspective will most certainly outweigh these financial benefits, forcing him to consider keeping these in-house now -- and indeed, forever.
Depending on the service provider and the technology, cloud security has evolved to a point where it may not be substantially less secure--for the class of applications which are generally moved to the public cloud--than an internally hosted and managed environment. However, as the class of applications moves up the scale from generic point applications to core enterprise applications, the associated risks start adding up.
The key issues here are:
* Contractual--Questions of liability and exposure, especially given he has multinational offices and customers with differing legislative and privacy requirements, as well as different comfort levels with being placed on the cloud
* Strategic--Questions of diminishing ability to work in multi-partner environments and being at the mercy of a large single-vendor environment where he may lose control over the future of his costs.
Dheeraj Sinha, Head-Global IT & Supply Chain, Apollo Tyres
Aligning IT with business, improving organisational effectiveness, team management with focus on the outcome and implementing effective supply chain practices.
100% cloud is for large firms
Since Vijay Sahai works in a manufacturing organisation with complex inter-dependent applications granular security, along with extensive network and security roles and profiles, his challenge is how to reduce costs while taking some of the complexities away, and at the same time, enhance performance levels of the IT systems.
Certain sets of applications which are completely inward facing and provide backend automation, like ERP, SCM, PLM, etc., are much more integrated with business processes and are more difficult to move to the cloud for an established business (at least in the near future)
For these complex applications, Vijay can look at IaaS (Infrastructure as a Service). For a lot of applications, corporates have a separate Dev/QA and Production environment.
There would always be requirements for a new set of applications which are workflow automations, or process efficiency enhancements. If the data interface needed for these are not very exhaustive, he can create a strategy around PAAS and have all newer applications delivered through the PAAS model or SAAS model, provided the Saas model exists.
For large enterprises, 100 per cent solutions on the cloud seem a distant dream. It is a matter of testing and migrating small pieces of application on the cloud and experiencing vendor solutions, their commitment and security practices. Theres still quite some time for corporates to move their real IT to the cloud. At least, not yet.
It is essential to enlist all future initiatives, with data complexity and dependency of the data on other applications (interface) along with app criticality defined, as the task becomes a little bit simpler.
Sahai needs to pick up applications and initiatives that are low on data integration, a little less critical and possibly having users outside of the office domain as well. They are the most appropriate targets for cloud.
Also, IT infrastructure requirements like Petabytes of space needed for backups, disaster recovery, infrastructure for less critical but necessary components like QA and Dev environment for various application landscapes can all be migrated to cloud.
The obvious advantages are much quicker delivery times, more robust platforms and the luxury to demand headroom for peak traffic requirements. All this would come at a fraction of what it will cost to own and maintain the systems, servers and applications.