Q&A WITH RICHARD GARSTHAGEN, DIRECTOR CLOUD BUSINESS DEVELOPMENT, AND IAN TICKLE, VP, EMEA SAAS SOLUTIONS
Can you briefly talk us through the core elements of cloud computing?
Richard Garsthagen, Ian Tickle (RG, IT): 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. This definition from the National Institute of Standards has gained broad support from the industry.
The NIST definition of cloud computing describes essential characteristics, service models and deployment models.
Five Essential Characteristics
– On-demand self service
– Resource pooling
– Rapid elasticity (IT resources are able to scale out and in quickly and on an as-needed basis)
– Measured service, including chargeback
– Broad network access
Three Service Models
-Software as a Service (SaaS) – Applications delivered as a service to end-users typically through a web browser.
-Platform as a Service (PaaS) – An application development and deployment platform delivered as a service to developers who use the platform to build, deploy and manage applications. The platform typically includes database, middleware, development and management tools
-Infrastructure as a Service (IaaS) – Compute servers, storage, and networking hardware delivered as a service. This infrastructure hardware is often virtualised, so virtualisation, operating system and management software are also part of IaaS as well.
Deployment Models
Private Clouds – For exclusive use by a single organisation and typically controlled, managed and hosted by the organisation’s IT department. The hosting and operation of private clouds may also be outsourced to a third party service provider, but a private cloud remains for the exclusive use of one organisation.
Public Clouds – For use by multiple organisations (tenants) on a shared basis and hosted and managed by a third party service provider. Public clouds are a form of outsourcing. The degree of resource sharing varies – shared resources can include some or all of facilities, network, storage, computing servers, databases, middleware and applications.
Hybrid Clouds – When a single organisation adopts both private and public clouds for single and/or multiple applications in order to take advantage of the benefits of both.
Modern cloud computing technology can help organisations see new business opportunities and innovate faster, because less it reduces risk and speeds up provision of resources. Whereas with traditional IT, organisations have to invest up front in resources to build the solution, not knowing if it will be successful. With most forms of cloud computing, this upfront investment is replaced by a “pay as you go” model which allows organisations to grow or scale down their IT as needed. This is how Oracle Cloud Solutions – the most complete and integrated cloud offerings in the industry – are helping people at all levels of their organisations succeed in modern business:
– Oracle Cloud – Oracle’s broad portfolio of software as a service applications, platform as a service, and social capabilities, all on a subscription basis.
– Oracle Private Cloud Products – Oracle’s comprehensive portfolio of best-in-class, integrated applications, platform, and infrastructure products and solutions.
– Oracle Managed Cloud Services – Oracle’s enterprise-grade, end-to-end managed cloud services across its broad portfolio of business applications, middleware, database, and hardware technologies.
– Oracle Services provides services across the lifecycle to help you plan your path to cloud and stay optimised.
What are the main trends in Europe around cloud computing?
RG, IT: Cloud computing is transforming the way businesses operate, streamlining processes and creating greater cost efficiencies. Demand for cloud is exploding. Of the 150 executives interviewed in UK, France and Germany for recent research for the Financial Times, 87% say their firm is already using cloud computing. (82% UK, 84% France, 94% Germany).
What’s driving cloud implementation? Cost is the overwhelming driving force behind corporate cloud implementation. When surveyed, 30% of respondents say that lower operating cost is the key driver. Reinforcing this point, a further 30% say that infrastructure costs are the major factor.
Businesses clearly recognise the transformational effect that cloud can have on corporate balance sheets. By shifting services onto the cloud, the costs associated with traditional IT, such as servers, software, staffing and maintenance, are considerably reduced. This has an impact on both capital and operational expenditure. “By implementing cloud, we end up paying a low, predictable, flat-rate monthly fee per user for the software that we use, which means that we can scale up or down as our business needs demand,” explains one UK-based CIO. “When we take on more staff, we can switch on new licences immediately, and similarly turn off the tap if we scale down.”
Improved resource allocation is also seen as important by respondents, with 19% highlighting a more efficient use of people and processes as their main reason for adopting cloud. For IT departments, this implies a transition to new value-added roles. “The IT workload is reduced because of cloud and the team is able to focus on improving the company by bringing new ideas that could enhance our processes,” says a France-based CIO.
Geographical Differences
While there are significant areas of commonality between France, Germany and the UK, there are differences among respondents regarding the drivers underpinning cloud implementation. This is clearly seen with lower infrastructure costs: while 40% of French respondents point to this as the most important factor, only 20% of German respondents do so. In part, these national variations can be accounted for by differences in maturity levels. Businesses in Germany are ahead of their counterparts in France and the UK in terms of cloud adoption, with 94% of German firms in the survey already using cloud. Based on our research, it seems that organisations tend to de-emphasise the importance of lower infrastructure costs once they start using cloud, with firms shifting focus to new areas of differentiation.
Where do firms deploy cloud? Cloud is seldom implemented across an entire organisation as a single project. Instead, most organisations adopt a bespoke approach to cloud adoption. Sales/CRM represents the single-most prominent department for cloud deployment, with 30% of firms implementing cloud solutions in this area. Marketing is the second most popular, with an average of 19% of organisations introducing cloud, followed by operations and logistics (15%) and product development (13%). Research, human resources and accounting amount to less than 10% each.
Where is cloud computing headed what’s next?
RG, IT: When it comes to the cloud, businesses are going to have one immediate responsibility: understanding which applications are going to increase productivity while making the business more efficient. This will involve deploying cloud solutions that will add value to the whole organisation including marketing, HR, the supply chain, customer engagement and sales, amongst others.
Concurrently, the Chief Information Officer will continue to evolve into the ‘Chief Innovation Officer’ – a role that feeds directly into the business goals of the organisation. The CIO will increasingly work much more closely to the CFO and the CEO to drive business growth through cloud applications and infrastructure. All three will become much more tech-savvy.
The Future of the Cloud also lies in Openness
Customers want choice, and this will drive the development of interoperable cloud technologies that they can mix at will. Businesses will use both public cloud services and private cloud services in tandem across a unified infrastructure. Importantly, these services will be accessible via a range of devices, many of which will be employee owned. These services will also be ‘socialised’, making them easy to use and helping to increase collaborative working.
Another key issue, related to openness, is integration. It is essential, in a future, hybrid-cloud world, that cloud-based and on premises applications can talk to each other to ensure an accurate and complete view of an organisation’s key data. As Larry Ellison himself put it, in a joint announcement with salesforce.com: “When you move to the cloud, companies don’t expect a multi hundred million dollar project to make their CRM from salesforce work with ERP from Oracle. We have to make that implementation work out of the box.” This announcement was the first in a series of announcements of cloud connector capabilities from Oracle, all of which go to underline the importance of integration across a hybrid cloud environment for businesses as they plan their future in the cloud.
