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Own the Cloud: Strategy and Action Plan
Cloud computing is not the future, it is the current reality. Be it on-premises or off, public or private, IT must have a strategy and plan for brokering cloud services.
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ANALYST PERSPECTIVE It’s not “to cloud or not to cloud” but whether IT will own the cloud or be left behind. The cloud is not a place. It is a method of provisioning compute services based on abstraction, elasticity, and automation on industry standard architectures. There has been a lot of hype about cloud but the adoption trends are real. Public cloud service adoption is being led by Amazon Web Services and Microsoft Azure. Meanwhile, private clouds both on-premises and in hosted services continue to grow. For IT departments, cloud is both an opportunity and a threat. The opportunity is to transform IT to be an effective broker of services from the hybrid cloud. The threat is that the business will flock to the cloud with haphazard abandon leaving out IT and the important roles you play in business accountability, security, and availability. Develop a position on cloud and a methodology for evaluating cloud opportunities and mitigating risks. Develop an action plan. Own the cloud! John Sloan, Research Director, Infrastructure Practice Info-Tech Research Group
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Help for IT to create a repeatable cloud assessment process
Infrastructure managers/VPs, IT Directors, and CIOs that are considering moving infrastructure, services, or applications to a cloud environment (Private, Public, IaaS, PaaS, SaaS). Review and evaluate known, current, and potential cloud initiatives. Assess cloud appropriateness and value of moving services to the cloud. Develop an approach and method of addressing risk. Build an action plan to mitigate risks and take next steps for cloud initiatives. Executive management of organizations that are evaluating existing cloud workloads or evaluating cloud as a destination for infrastructure, services, and applications. Establish a reliable and repeatable process for use in future cloud assessments. Gain certainty around cloud value proposition and cloud opportunities. Ensure their organization’s IT capabilities support the evolving business needs. Understand and articulate the need, benefits, and rationalizations of migrating services to the cloud.
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Executive summary Cloud is maturing and others are finding substantial benefits in leveraging its elasticity, agility, availability, and IT efficiency gains. The CIO or CFO are demanding better management of services, cost cuts, and calling for a review of the organization’s cloud strategy. Vendor pressure is pushing you in the direction of the cloud. The cloud is not a place. Though hosted private and public cloud are attractive outsourcing targets, they are not the whole story of either outsourcing or cloud computing. Hybrid is the goal. Most are pursuing a strategy of on-premises and off site public and private clouds together in hybrid. Cloud is not fire and forget. Cloud strategy needs to account for changes to people, processes, and technology to be successful. Neglecting cloud as an option may result in missed opportunities to lower costs or improve service to the business, but identifying which infrastructure or services belong in the cloud is challenging, whether a service is in the cloud already or not. Truly understanding business impact (cost/benefit) and the risk potential is daunting, but decisions must be made that will have lasting impact. Evaluate the business goals, drivers, and existing policies toward cloud service provisioning to understand the true purpose and objective of a cloud strategy for the business. Using Info-Tech’s Cloud Strategy Workbook IT Assessment, determine the organizational readiness to adopt cloud services across major areas that affect an organization’s ability to effectively leverage cloud services. Identify in-scope IT services for potential cloud initiatives and the strategy as a whole. Assess selected services’ value and readiness to be moved to the cloud. Identify and mitigate risk using a systematic methodology to build key preventive elements into the action plan. Define a target state and action plan to present to business stakeholders using our Cloud Strategy and Action Plan Template. Use Info-Tech’s Cloud Service TCO Comparison Tool and Cost/Benefit Analysis Tool to review the business impact of cloud.
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Why do you need a cloud strategy? – Info-Tech clients tell us…
We are concerned about shadow IT. Departments and individuals are already using cloud services without regard for security or integration. Our CEO attended a conference and was impressed by an Amazon AWS presentation. Our CEO wants to know why we aren’t using the cloud and when and how we will start. We have a mandate to migrate our on-premises data center to the cloud over the next three years. We are a Microsoft shop and Microsoft has been hard selling Azure as the future home of all of our applications and services. We are interested in moving everyone to Office 365 this year, including productivity apps, SharePoint, Outlook, and OneDrive.
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Cloud is not a place; it is a way of provisioning compute services based on abstraction, elasticity, and automation Cloud computing is a model for enabling ubiquitous, convenient, on-demand network access to a shared pool of configurable computing resources (e.g. networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. The cloud model is composed of five essential characteristics, three service models, and four deployment models. Source: National Institute of Standards and Technology (NIST) Definition of Cloud Computing.
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Cloud is not the future; cloud is current reality
Rapid growth in the adoption of multiple devices by end users, consumers, and businesses is a major factor in the transition to cloud-based services that can provide ubiquitous access to content and applications through any device at any location. Cloud-based services are essential to the Internet of Everything (IoE), which increases the ability for people, data, and things to communicate with one another over the Internet. According to Machina Research, machine-to-machine (M2M) connections are expected to grow 5X faster than smart devices between 2012 to 2022. Approximately 66% of data is in the cloud today. 49% of companies are using the cloud to fuel revenue generation or new product creation. By 2017: Nearly two-thirds of all workloads will be processed in the cloud. Global cloud IP traffic will account for more than two-thirds of total data center traffic. 68% of data center traffic will be cloud traffic. Sources: Cisco Global Cloud Index: Forecast and Methodology, 2012–2017 RightScale 2016 State of the Cloud Report Cloudtweaks: Cloud Infographic – Cloud Fast Facts The Future of Cloud Computing 2014, North Bridge in partnership with Gigaom Research
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Cloud will be an increasingly important part of IT services; a planned approach will avoid the pitfalls of an ad hoc approach Unmanaged and ad hoc approaches to cloud opportunities cause: Increased potential for unacceptable risk (security and compliance) to critical enterprise data. Fragmentation of business data, processes, and identity management due to lack of integration. Missed opportunities to lower costs and improve service to the business. Ad hoc due diligence that frustrates the speed and agility benefits of cloud. IT to be shut out of key IT decisions and its role and validity to be questioned. An enterprise cloud computing strategy results in: Broad consensus on goals and expected results of moving select processes to the cloud. Standardized, consistent approach to evaluating the benefits and challenges of cloud projects. Clear requirements for the negotiation and monitoring of partnerships with cloud service providers. Understanding and consensus on the enabling and managing role IT will play in future cloud initiatives. Goals and a roadmap for transforming internal IT from asset managers to service brokers. In January 2016, RightScale surveyed 1,060 technical professionals across a broad cross-section of organizations about their adoption of cloud computing. Source: RightScale 2016 State of the Cloud Report
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“Not Here” The simplest, and least accurate, definition of cloud
Cloud strategy is often seen only as outsourcing IT services to external hosts. I wonder if we can outsource this to a web host, co-location provider, managed service provider, or application service provider? I wonder if we can use the cloud for this? Then Now
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An outsourcing strategy is not a cloud strategy; however, cloud models, both public and private, can be attractive options Private cloud. The cloud infrastructure is provisioned for exclusive use by a single organization comprising multiple consumers (e.g. business units). It may be owned, managed, and operated by the organization, a third party, or some combination of them, and it may exist on or off premises Source: (NIST) Definition of Cloud Computing In-House Application Co-Location MSP IaaS Virtual Machine Storage Facilities Server Organization has control Organization or vendor may control Vendor has control An externally hosted service is a cloud service by virtue of how it is provisioned, not by virtue of it being external. A private cloud can be on-premises in your own data center but it can also be off premises in a co-lo site. As well, it can be managed and operated (controlled) by you or a third party in a managed service. Remember, cloud is not a place.
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For most infrastructure groups, the ideal is a hybrid cloud strategy of on-premises and off-site public and private cloud Hybrid cloud. The cloud infrastructure is a composition of two or more distinct cloud infrastructures (private, community, or public) that remain unique entities, but are bound together by standardized or proprietary technology that enables data and application portability (e.g. cloud bursting for load balancing between clouds). Source: (NIST) Definition of Cloud Computing Source: RightScale 2016 State of the Cloud Report
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Before you go any further, these common myths about cloud need to be addressed and debunked
1 You should use the public cloud for everything. Not every workload, application, or piece of data belongs in the public cloud. For many workloads and use cases, the public cloud can make a lot of sense. But there will remain workloads that just are not good cloud candidates and others that are best hosted in your private cloud. 2 Data is less secure in the cloud. Security has traditionally been a top of mind risk for new cloud customers. While an important consideration, security becomes less of a concern with experience. Data security is typically more robust in the cloud than on-premises because “the majority of cloud providers build security using a multi-layered approach into their infrastructure from the ground up.” – Paul Mazzucco, Chief Security Officer, tierPoint LLC. 3 Outsourcing to cloud is all about the cost savings. Public cloud IaaS prices are dropping but don’t let cost savings rule your decision. Lower cost barriers to entry (rapid instantiation and pay as you go) are definite cloud benefits but overall total costs over time may be comparable to on-premises infrastructure. Focus on decreased time to value, agility (elasticity), cost predictability, and reduced operational complexity instead of looking for big long-term cost savings.
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Best practice for cloud strategy includes four key phases
1 Assess current state for cloud readiness and priorities. How cloud-like is your current IT regime? Is infrastructure already consolidated, standardized, virtualized, and automated? What are your corporate IT goals? What form of cloud service models and delivery models are your priority? 2 Evaluate cloud readiness of given workloads. Where will your cloud strategy likely start? Identify the low hanging fruit. What workloads are excellent candidates for external public or private cloud hosting? What are the applications and services which are not good candidates for cloud provisioning? 3 Mitigate risks and challenges of cloud. Identify the risks and challenges of greater adoption of cloud services. What can be done to mitigate those challenges (both actions you can take and requirements of a services provider)? Build and communicate your action plan. By this point you will have a set of priorities, workload and service candidates, actions, and requirements. It is time to pull this together into an actionable roadmap with activities, key dates, and success measures. Communicate this plan to the organization. 4
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Follow Info-Tech’s methodology to build and execute your enterprise cloud strategy
Phases 1 Evaluate the Business and the Cloud 2 Mitigate Key Risks 3 Complete the Cloud Strategy Steps 1.1 Assess Current State 2.1 Identify Cloud Risks & Roadblocks 3.1 Define a Strategic Target State 1.2 Prioritize Cloud Initiatives 2.2 Build Strategies to Mitigate Risks 3.2 Review Business Impact 1.3 Assess Value & Readiness 3.3 Finalize an Action Plan Tools Current State Assessment Risk & Mitigation Register Cloud Service TCO Comparison Deployment Model Decision Tree Action Plan & Communication Deck Service Value and Readiness Assessment
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Cloud readiness analysis plots your workloads and services on the cloud decision matrix
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Info-Tech has identified five key risk and roadblock areas that IT must address when evaluating cloud projects In Info-Tech’s experience with cloud implementations, most of the challenges and pitfalls tend to be related to these five areas. In these risk areas, there are both internal and external implications. Data is a critical resource. In the cloud, data is entrusted to a third party and shares tenancy with other people’s data. 1 Availability and reliability are still real concerns. It’s not a matter of if, but when. No matter the cloud service provider, you need to be prepared for outages. 2 3 Success in adopting cloud solutions isn’t possible without a solid integration strategy. 4 Moving to the cloud does not make internal infrastructure responsibilities disappear. 5 Take a proactive position to prepare for the shift in IT responsibility.
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The top challenges of using the cloud also change with maturity
Security is no longer the top concern for businesses that leverage the cloud. In fact, as maturity increases security becomes less of an issue. Today, the top challenge is building sufficient resources and expertise. Place Cloud Beginners Cloud Explorers Cloud Focused #1 Lack of resources/expertise (38%) Lack of resources/expertise (34%) Lack of resources/expertise (26%) #2 Security (35%) Compliance (32%) Building a private cloud (19%) #3 Compliance (34%) Managing costs (30%) Managing costs (18%) #4 Managing multiple cloud services (30%) Security (28%) Managing multiple cloud services (18%) #5 Governance/Control (29%) Managing multiple cloud services (26%) Security (17%) Cloud Beginners New to cloud computing and are working on proof-of-concepts or initial cloud projects. Beginners want to gain experience with cloud in order to determine future projects. Cloud Explorers Explorers have multiple projects or applications already deployed in the cloud. Cloud Explorers are focused on improving and expanding their use of cloud resources. Cloud Focused Businesses that are heavily using cloud infrastructure and are looking to optimize cloud operations as well as cloud costs. Source: 2016 State of the Cloud Report, RightScale
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Use this blueprint to move forward in Open Data Center Alliance’s Cloud Maturity Model (CMM)
Source: Open Data Center Alliance
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FEATURED CASE STUDIES 1 2 3 Company Industry Anonymous
Personal Care Consumer Packaged Goods (CPG) The IT leadership of this Personal Care producer, a multinational corporation (MNC), met in a workshop facilitated by Info-Tech to build a cloud strategy. Without a strategy already in place, cloud procurement was largely ad hoc and slow to execute. The business was now demanding “cloud speed.” Their findings are shown in this report: Case Studies: “Cross-organizational silos are broken at this multinational corporation (MNC) when cloud value is laid to bare.” “Info-Tech’s IT assessment delivers direction-changing insight to contribute to the overall strategy.” “A roadmap is developed to transform IT from an order taker to a service broker.” 2 Company Industry Anonymous Non-Profit Education Services This non-profit company based in Washington, DC needed to build the case for transition services from a co-location provider to a managed services solution. What it didn’t realize was the potential for leveraging cloud services in this new environment. Case Study: “For this private non-profit, cloud strategy was all a part of acquiring managed services.” “The financials were needed, but they didn’t make the business case – the incremental value of the service is the real sell.” Company Industry Anonymous Financial Services From Info-Tech’s continuous engagement with its members through such services as advisory and workshops, Info-Tech collects great information like these two cost cases: 3 Cost Case #1: The elasticity of the cloud can be a game changer. Starting with DR can prove cost-effective. Cost Case #2: Direct cost comparison is critical. Consider these real client quotes for in-house, co-location, and cloud. Note on Subject Companies All of the above are real companies and cases.
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Info-Tech delivers Current State Assessment How far are your current people, processes, and technologies from a hybrid cloud delivery model? Service Readiness Assessment Of the many services you maintain, which would be better or worse cloud candidates? Risk Mitigation Plans Actions and requirements to mitigate the five key risk areas. Execution Timeline A timeline of project milestones for executing your strategy. Cloud Strategy and Action Plan Template The final deliverable is a strategy that documents cloud priorities and actions.
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Use these icons to help direct you as you navigate this research
Use these icons to help guide you through each step of the blueprint and direct you to content related to the recommended activities. This icon denotes a slide where a supporting Info-Tech tool or template will help you perform the activity or step associated with the slide. Refer to the supporting tool or template to get the best results and proceed to the next step of the project. This icon denotes a slide with an associated activity. The activity can be performed either as part of your project or with the support of Info-Tech team members, who will come onsite to facilitate a workshop for your organization.
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Info-Tech offers various levels of support to best suit your needs
Guided Implementation “Our team knows that we need to fix a process, but we need assistance to determine where to focus. Some check-ins along the way would help keep us on track.” DIY Toolkit “Our team has already made this critical project a priority, and we have the time and capability, but some guidance along the way would be helpful.” Workshop “We need to hit the ground running and get this project kicked off immediately. Our team has the ability to take this over once we get a framework and strategy in place.” Consulting “Our team does not have the time or the knowledge to take this project on. We need assistance through the entirety of this project.” Diagnostics and consistent frameworks used throughout all four options
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Measured value for Guided Implementations (GIs) and Workshops of this project
Engaging in GIs doesn’t just offer valuable project advice, it also results in significant cost savings. GI Measured Value Phase 1: Evaluate the Business and the Cloud Time, value, and resources saved by using Info-Tech’s tools to assess IT readiness to move to the cloud; evaluate service value and readiness for cloud provisioning. For example, 2 FTEs * 10 days * $80,000/year = $6,400 Phase 2: Mitigate Key Risks Time, value, and resources saved by using Info-Tech’s methodology and sample data to identify and mitigate risks pertinent to a successful cloud strategy execution. Phase 3: Complete the Cloud Strategy Time, value, and resources saved by following Info-Tech’s methodology, tools, and templates to define a target future state of leveraging cloud services, compare TCO and cost benefit analysis of potential scenarios, and build an action plan to execute. For example, 2 FTEs * 5 days * $80,000/year = $3,200 Total Savings Example: $16,000 Workshop Our members say this workshop saved them… Dollar Impact $50,000
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Best-Practice Toolkit Guided Implementations
Own the Cloud: Strategy and Action Plan – project overview (three phases) 1. Evaluate the Business and the Cloud 2. Identify and Mitigate Key Risks 3. Complete the Cloud Strategy Best-Practice Toolkit 1.1 Evaluate Current State 1.2 Align and Prioritize Initiatives 1.3 Assess Value and Readiness 2.1 Identify Key Risks 2.2 Build Mitigation Strategies 3.1 Refine the Vision 3.2 Review Business Impact 3.3 Finalize an Action Plan Guided Implementations Discuss goals and drivers. Introduce Cloud Strategy Workbook. Review IT current assessment. Discuss business activities and IT services. Prioritize services to run through readiness and value assessment of Step 2.1. Review value and readiness results. Discuss stakeholder concerns regarding cloud. Walk through risk assessment activities and present module 3 of Cloud Strategy Workbook. Review risks and brainstorm mitigation strategies to address risks identified from 3.1. Consider implications to desired target state. Discuss and define target state. Review cloud strategy and business impact. Outline strategic action plan to move strategy forward across business. Continue ongoing touchpoints as desired with analyst to discuss cloud strategy impact and effectiveness. Onsite Workshop Module 1: Evaluate business and cloud current state. Module 2: Evaluate opportunities and readiness. Module 3 and 4: Mitigate key risks of target cloud computing and build a strategic action plan. Phase 1 Outcome: Current state assessment Prioritized cloud initiatives Value and readiness assessment of selected services Phase 2 Outcome: Action plan to mitigate identified risks Phase 3 Outcome: Strategy document TCO service comparison Action plan to execute on strategy Communication deck
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Workshop overview Contact your account representative or for more information. Workshop Day 1 Workshop Day 2 Workshop Day 3 Workshop Day 4 Workshop Day 5 Activities Evaluate Current State and Organizational Suitability 1.0 Define cloud. 1.1 Outline corporate goals, current unmet needs, key stakeholders, and strategy drivers. 1.2 Assess IT current state. 1.3 Review cloud deployment models and service types. 1.4 Align, prioritize, and select cloud initiatives for review. Evaluate Service Opportunities and Readiness 2.1 Assess the value opportunities for moving selected services to the cloud. 2.2 Evaluate readiness of selected cloud initiatives. Mitigate Key Risks of Target Cloud Computing 3.1 Understand risks associated with cloud and contrasting perspectives. 3.2 Demonstrate methodology for addressing cloud risk across 5 key areas: Security & Compliance Availability & Reliability Data Integration Staff Resourcing Internal Infrastructure 3.3 Build mitigation strategies to address risks. Build a Strategic Action Plan 4.1 Define a strategic target state. 4.2 Review business impact (cost model, benefits, resourcing). 4.3 Build an action plan. Off-Site 5.1 Complete an ongoing communication plan. 5.2 Review your cloud strategy. Deliverables List of goals, unmet needs, key stakeholders, and cloud drivers. IT cloud readiness assessment. Candidate services for Module 2 selected. Service specific readiness/value assessment. Establish Go/Caution/Stop for selected services. Risk registry. Action plans for risk mitigation. Clearly-defined and documented target state vision. Build action plan timeline. Build first draft of strategy and action plan document. Communication plan for cloud adoption. Cloud strategy document.
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Critical Insight Breakdown
Phase One: “Not here” is Not Good Enough. Defining cloud as a blanket term for outsourcing – cloud = not here – does neither outsourcing nor cloud computing justice. Cloud computing is a specific way of provisioning compute resources. It can certainly be a legitimate outsourcing target but is not the only option. It can also be an effective and efficient way of provisioning compute on your own premises, or co-lo facility, as a private cloud. If the ultimate goal is a hybrid cloud – and for many it is – you must develop a rich understanding of the cloud service options as well as your core drivers and then assess readiness of your department and your workloads for migration to cloud. Phase Two: Cloud Risks and Challenges are Yellow Lights. When driving an automobile, a red light means stop. A yellow light means slow down, assess the risk or danger, and proceed with caution but be prepared to stop. The five areas of risk and challenge identified by Info-Tech are all yellow lights. They require caution and assessment, and due diligence. They are not automatic deal breakers, but to proceed without plans for addressing these is like obliviously speeding through an intersection. You do so at your peril. Phase Three: Don’t Lead With Total Cost Savings. The real cost benefits of cloud computing are at the front end. Cloud offers potential of short time to value as there is little in the way of upfront capital costs (low barriers to access). However, cloud costs accumulate over time and total accumulated cost over the lifespan of a service can start to look like the cost of an on-premises technology. Focus first on agility and value added services.
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