IT Managers Share Their Cloud Experiences

The common best-practices associated with managed cloud service utilization are hard to find, since the early-adopters rarely share their insights. Of course, for all the other people that are still assessing the potential benefits, that guidance is truly invaluable.

Therefore, it's very helpful that Forrester Research was able to interview more than 60 organizations that are currently leveraging Infrastructure as a Service (IaaS) cloud-based solutions within their business environment.

Forrester defines public IaaS cloud computing as the delivery of compute (virtualized servers, storage, and networking) on-demand as a shared service. Based on their findings, they say that the evolving usage characteristics fall primarily into three emerging practices.

Test and Development in the Cloud
The most common practice they found among enterprise users of IaaS cloud platforms was to build and validate new apps. Cloud platforms provide relief for in-house test and development teams who face resource constraints. Moving these actions to the cloud relieves a significant IT burden, but only for apps that are suited to the cloud -- those that can fit within the confines of a virtual server.

Deploying Web Applications
The majority of applications deployed on public cloud infrastructures are Web-based apps. Early users of IaaS clouds have found the greatest benefits with Web apps that are short-term oriented and/or unpredictable or volatile traffic patterns. These types of apps can best take advantage of the pay-per-use element of cloud infrastructures to right-size the cost of deployment to the behaviors of the apps.

High-Performance Computing
Another good fit with IaaS cloud platforms is high-performance computing. These often massively parallel programs can be scaled-out to effectively tackle very large problems, and the constraints of HPC are usually the size of compute grid that can be deployed. Enterprises are constantly having to trade off grid size and cost against speed of getting the result. Apparently, IaaS clouds provide relief to this tension.

Next Wave of Manage Cloud Service Apps
According to Forrester, given the above mentioned IaaS best practices, the next wave of cloud services best practices that infrastructure and operations professionals should focus on are as follows:

• Leveraging cloud management applications and services.
• Cloud bursting -- to maximize scaling within the cloud.
• Integrating cloud services with data center services.
• Leveraging cloud-scale services.
  

The Beginner's Guide to Cloud Adoption
So, where should you start? Forrester suggests, make sure you have supportive executives who will view your use of cloud computing as empowering for the business -- not as a threat to infrastructure and operations. Then, start experimenting with the common applications listed.

Clearly, IT and network out-tasking has a place in most organizations. Forrester says that their key findings show that cloud, while truly compelling, shouldn't be viewed as a replacement for the data center. It is, however, a viable alternative approach to consider.

How to Unlock the Power of Virtualization

Virtualization uses technology to remove the physical barriers associated with computer servers and applications -- enabling the consolidation or replacement of servers, storage, network and other physical devices.

As a result, your business can better use computing capacity and drive more value from IT resources as well as consolidate data centers and significantly lower energy consumption.

For companies who need guidance on a virtualization project, Verizon Business offers these five tips -- culled from the company's years of experience handling complex IT installations and expertise in implementing and managing virtual environments:

1. Make sure you're looking at the big picture: A business should first complete a thorough assessment of its current IT environment and computing resources, including a full review of all servers. Once the enterprise has a better understanding of its infrastructure, it is easier to determine which computing resources, such as servers and devices, are candidates for consolidation.
2. Enlist vendor support: After compiling a list of applications that can be virtualized, it is important to confirm there will be very few, if any, issues with vendor support. Some vendors, especially smaller ones, do not support their software on virtualized platforms.
3. Evaluate licensing costs: When assessing applications for migration, evaluate the licensing costs associated with them. While consolidating multiple servers and devices into a single virtual machine will lower hardware and facility costs, this does not necessarily apply to software licensing costs. Many vendors still charge based on total available power and the number of physical applications. If that's the case, consider working with vendors that embrace more flexible licensing models.
4. Avoid common bottlenecks: Carefully assess the memory and storage requirements for applications moving to the virtual environment. Memory and storage can severely limit how many virtual machines a host can support. A common scenario is an environment with consolidated storage and a high number of mobile BlackBerry users, requiring large memory and storage needs. Therefore, assessment, management and proper allocation of applications per virtual machine are key.
5. Security, security, security: Security should be a top priority; it should be built in from the ground up to ensure the new environment comes with the right safeguards. Enterprises also should pay close attention to relevant industry regulations. For instance, businesses that store, handle or process customer payment information must maintain compliance with the Payment Card Industry Data Security Standard (PCI DSS), a comprehensive set of requirements for enhancing payment account data security. In that case, PCI DSS compliance would be a key requirement for the new virtual environment.
   

"Virtualization holds huge promise for the enterprise," said Michael Marcellin, vice president of Verizon global managed solutions. "Its ability to increase efficiency and agility while managing costs is unparalleled. With that potential, however, comes complexity concerning deployment and implementation. Our hope is that enterprises will take this promising technology to heart and embrace our suggestions -- based on our more than 10 years experience managing complex IT infrastructures -- on how best to utilize it."

Verizon Business offers a wealth of IT and hosting solutions to help customers meet their most-pressing IT needs in today's dynamic business environment. As we've previously reported on the Business Technology Roundtable, enterprise and small-business executives are actively adopting the selective out-tasking of applications to these managed cloud services.

Why Early-Adopters Embrace the Cloud

Cloud computing is all about new technology, right? Well, perhaps that depends upon your point of view -- as an application developer, or a business decision maker.

Private Cloud development will grow during the coming year, with 48.9% of developers expecting to deploy applications (via their on-site data center), according to a survey of 500 software developers by Evans Data Corp.

Their survey showed that 29.7% are currently working on applications destined for a private cloud environment, while an additional 19.2% expect to enter development within the next 12 months.

Taking Baby Steps with Cloud Computing
"Software developers are finding many reasons to develop software for the cloud, whether for a private cloud or public cloud," said John Andrews, President and CEO of Evans Data. "Not surprising, while developers want to take advantage of the cloud, our research indicates a strong preference for them to favor a cloud related development environment to simply extend their existing technology know-how."

The survey measured the intentions and adoption patterns of developers. This included Public and Private Cloud development -- types of apps moving first to the Cloud, development dynamics and tools for developing in the Cloud, data centers and virtualization, security, regulations, benefits, and inhibitors.

"Private clouds seem to be appealing for the easier methods of deploying and automating software delivery rather than the elasticity, and different pricing, that drove the initial fervor in public clouds," commented Michael Cote, software industry analyst for Redmonk.

Michael Dortch, acting director of research at Focus, said "Frankly, I'm surprised it's only 48 percent of developers, given that software as a service and other cloud-based elements are the only piece of the current software marketplace showing consistent, significant growth."

The survey results expose the trends. Half of the developers using Amazon public cloud services are adopting them experimentally or for prototyping -- rather than for business critical applications.

Three quarters of developers think that data for applications deployed in the cloud should be backed-up outside the public cloud -- either in traditional on-site storage or in a private cloud.

Fearless Early-Adopters Seek an Advantage
"The buying community is setting themselves up for another cloud spending moment once they decide public clouds are okay and move from private clouds," Cote said. "While security and regulatory concerns are very real, companies would do well to spend time asserting how they might skip some of their computing needs over the public clouds and avoid paying twice for everything."

That said, the primary motivation for business decision makers, that are early-adopters of managed cloud services, can be simply put -- strategic competitive advantage. While their peer group ponders the risks versus rewards, they're already vigorously moving forward.

Cloud Services Interest Erupts in Groundswell

The anticipated benefits from adopting managed cloud services have reached the executives suites of many corporations. Proactive CEOs and CFOs are pushing their IT leadership team to seek out actionable information and guidance.

There's also a constant stream of service providers announcing new offerings -- and the momentum is becoming a global phenomenon. As a result, Forrester Research has witnessed an expanding number of client inquiries around cloud computing.

The acceleration in market development has been building for some time now. Forrester analysts responded to more than 264 client inquiries about cloud computing between January 2008 and April 1, 2009 from companies of all sizes and industries.

IT Teams are Adopting Cloud Strategies
Once considered a niche business technology where awareness was viewed as optional, Forrester now says that knowledge of cloud computing has become an IT organization necessity. Interest is fueled by expectations of major cost savings, scalable and dynamic environments, on-demand infrastructure, and much smaller maintenance requirements.

In a recent research note, Forrester outlined the most common questions about cloud services.

Twenty-three percent of cloud computing inquiries were about the types of applications that companies were moving into the cloud and how best to leverage cloud service environments. People want to know the spectrum of possibilities -- what apps to put in the cloud?

Some questions are motivated by the need for improved business agility. The promise of better scalability and versatility makes cloud services appealing. Moreover, innovation is often stifled by the investment needed to acquire and deploy new IT infrastructure and associated application environments.

Fifteen percent of the inquiries were on challenges, risks, and the effects of cloud-based services on IT -- such as, what are the typical use cases, and how much enterprise data should live in public clouds?

Clouds are Coexisting in Hybrid Models
Forrester believes questions regarding when to build internal clouds, and the "internal vs. external" debate, will be at the forefront of cloud computing due diligence in the coming months -- which cloud service scenario is a best-fit for our particular needs?

Forrester concluded from their client engagements that cloud computing represents a significant shift in the way IT operates today -- it's not a passing fad, it's a trend that's based upon solid business need for a change in the status quo.

The following are Forrester's recommendations:

• Know your costs, requirements, and potential areas for cost saving.
• Businesses with basic requirements can begin to pilot public clouds.
• Evaluate internal clouds, while also considering a hybrid model.
• Formulate standards, and a cloud policy to govern procurement.
  

As the momentum for managed cloud services continue to build in 2009, we'll be on the lookout for additional sources of insight.

Retailers Upbeat About TelePresence Applications

Companies with extended supply chains frequently need to collaborate with multiple partners -- simultaneously and visually. Yesterday at the National Retail Federation Conference in New York, AT&T and Cisco reminded attendees that they have added multipoint capabilities to their telepresence offering, which AT&T delivers as a managed service.

Attendees visiting AT&T's booth participated in videoconferencing discussions with Cisco employees in San Jose, and expressed confidence that they could apply the teleconferencing capabilities in their business immediately. Collin Cupid of high-end handbags and accessories manufacturer Coach said, "It made you feel like everybody's in the same room."

Sally Curtis of Planet Retail, a market research firm, said, "We can use this in our own context for communicating with customers. It's absolutely real." A couple of executives from United Rentals wanted an installation "yesterday," but were willing to settle for getting the equipment from the show floor. "Can we take that one right now?" asked Michael Ellis.

According to the companies, the AT&T Telepresence Solution works over the AT&T Virtual Private Network transport and provides:

• AT&T-owned Cisco TelePresence equipment
• Visual experience with the simplicity of a phone call
• Installation, monitoring and management of the application
• On-site equipment maintenance and repair, plus remote support
  
• Ability to handle complex, multinational, inter-company communications
• Security and reliability, as well as reduced IT staff requirements and limited impact on existing network applications
• Reduced exposure to technological obsolescence, reduced upfront capital expenditure
  

Global companies with extended supply chains can use telepresence to improve communications and accelerate time-to-market. They can also apply the visual medium to transcend cross-cultural communication hurdles, and thereby improve the speed of decision-making and overall operational efficiency.

Managed Service Scenarios: Choosing the Best-Fit Solution

Are you puzzled about how to choose the best-fit managed service solution for your particular business needs? As a basic guide, the following are three typical high-level scenarios for deploying managed network services.

Scenario 1: Customer Owns Network and Shares Management Responsibility

Companies that already have an internal IP network can continue to manage it while out-tasking the management of onsite equipment -- usually known as customer-premises equipment (CPE), used for the managed service (see Figure 1).


The Roles and Responsibilities are as follows:
Managed service provider -- Sets up, maintains, and administers the equipment needed for the managed service, including company-owned equipment such as servers.

Company -- Managed service customer maintains and administers its internal network.

Scenario 2: Service Provider Owns the CPE; Customer Can Share Equipment Management with Service Provider

Some companies do not own a LAN, either because the location is new or the company already out-tasks its LAN services. In this situation, the service provider can manage the equipment needed for the corporate network as well as the managed service.

Many large enterprises like this arrangement because they can maintain physical control of the equipment while relying on the service provider for 24-hour network operational support (see Figure 2).


The Roles and Responsibilities are as follows:
Managed service provider -- Sets up, maintains, and administers the equipment for the managed services as well as the corporate network.

Company -- Monitors its corporate network through a Web interface provided by the service provider, receives regular reports on the network status and managed services, and is notified in case of a defined emergency.

Scenario 3: Service Provider Owns Equipment in its Own Facility; Customer Monitors Service Provider's Management of the Equipment

The difference between this scenario and the previous one is that most of the equipment is physically located in the service provider's "hosting" facility instead of on the customer premises.

The Roles and Responsibilities are as follows:
Managed service provider -- Sets up, maintains, and administers the corporate network and related managed services; most of the network equipment is physically located in the provider's computing center; the exceptions are the equipment for the LAN and network connections, as well as gateways for computers and IP telephony.

Company -- Monitors performance of its systems through a Web interface provided by the service provider, receives regular reports on the network status, and is notified in case of a defined emergency.

Summary: each of the three basic scenarios can be customized to meet your particular requirements. In upcoming posts, we'll identify some more specific application examples.

Creative Applications for Managed Network Services

Perhaps the restaurant sector doesn't immediately come to mind when you think of creative applications of current business technology. But, that's exactly why it can provide a distinctive competitive advantage for a savvy forward-looking company.

Popeyes quick-service restaurant was founded in 1972 and has expanded to over 1000 franchised locations globally. A Popeyes franchise owner of multiple U.S. east coast locations became interested in using the latest communications technology to reduce his operational costs and streamline back-office functions at each site.

This upgrade included installing a new voice and data network that could manage secure credit card transactions. The decision was made to research a solution to update communication capabilities with a private Internet Protocol (IP) network.

A network using Multi-Protocol Label Switching (MPLS) technology was procured, replacing the cumbersome and outdated analog communication lines. Once the private voice, data, and video network was in place, the next logical step was to determine how to further gain cost advantages by leveraging this advanced infrastructure.

Built on a Solid Foundation
After carefully evaluating several telephone system solutions, the decision was made to use a hosted Voice over IP (VoIP) service from Geckotech, layered over the new backbone network. As a hosted service provider, Geckotech manages an off-premise voice solution that has built-in disaster recovery and very high reliability.

The Popeyes franchises are now able to fully realize the advantages of an outsourced VoIP phone system without having to purchase, maintain, or manage separate phone systems at each location.

All restaurant sites can easily reach each other using simple 4-digit extension dialing. They also benefit from one consolidated monthly telecom bill -- which includes unlimited local and long distance, advanced features like Auto-Attendant, eFax, Conferencing, and Unified Messaging.

Moreover, all of the outdated phone systems were replaced with one advanced VoIP solution, using Cisco Systems hardware end-to-end. As a result, Geckotech enabled the franchise owner to prepare for future business needs, based on a solid communications foundation.

The multiple locations benefit from a built-in disaster recovery plan, which reroutes all calls to a different office location should any site experience a disturbance or natural disaster. The new voice system has reduced overall operational costs by almost 40 percent at each site.

The Power of Strategic Foresight
In reality, there are few enterprises in the 21st century that are inherently low-tech. Every industry has its early-adopters of business technology that assess all the options, survey the competitive landscape, and then take decisive action.

The rewards clearly go to those business leaders who keep and open mind, and willingly embrace change –- especially when it equates to a quantum leap in progress.

Small Community Banks, Big Managed Service Benefits

Community banks have attracted new customers by offering a truly personal banking experience that their larger rivals can't match, and by maintaining close ties to local communities.

However, all bank customers are demanding Business Technology driven services that many community banks simply can't provide with their current infrastructures. The lack of the latest technology can make migrating to new services prohibitively complex and expensive.

Community banks have depended on multiple providers for their voice and data networks. These banks found that they were paying substantially more for their network connections than larger institutions.

Moreover, having to deal with multiple providers can strain the smaller bank's modest IT staff. Implementing and operating a new converged voice/data/video IP network would overwhelm an IT team that usually handles simple tasks.

In addition, deploying a new IP network could negatively impact the community bank's operating budget. In fact, the total cost of ownership (TCO) for a typical bank's voice and data networks is second only to employee salaries and benefits.

Truly Demanding Operating Environment
Adding to these business challenges is the banking industry's strong emphasis on security and business continuity. Banks must be certain that their networks can pass their banking regulator's annual IT audit -- and deliver 24/7 services to customers in the event of a major disaster.

A strict regulatory environment and tight budgets make community bankers conservative when it comes to implementing technologies they consider unfamiliar. One solution that's proven, and likely to deliver lower operating costs, is the out-tasking of IT and communication network needs to a managed service provider.

A managed service solution can reduce a community bank's recurring voice and data expenses by 10 to 25 percent, with even greater reductions possible for larger banks.

Less Restrictions, More Freedom to Innovate
That said, an out-tasked IT and network infrastructure scenario isn’t purely about cost-reduction, it's also an enabler of customer service innovation. As an example, community banks are now deploying TelePresence applications that simplify the challenge of delivering full-service offerings at their distant branch locations.

A customer at an outlying branch can contact a bank officer at another branch and talk face to face without having to travel a great distance for the meeting. Plus, all required transactions can be completed locally.

Small community banks can now gain big Business Technology benefits, thanks to the creative use of managed services.

Intro to the Business Technology Roundtable

Today, the application of technology is an integral part of most businesses – in some shape or form. However, while many decision makers are now primarily concerned with using technology to pursue new business opportunities, and gaining business-related capabilities is their main objective, the vendors and suppliers that they encounter sometimes don't speak the same language.

Matching buyer's business needs with technology vendor's offerings is sometimes referred to as the business/technology alignment chasm. Filling that void with substantive information, meaningful guidance, and compelling "how-to" storylines is the charter of the Business Technology Roundtable (BTR). We seek to shed light where there has been an apparent absence of editorial illumination.

A business technologist -- perhaps a new term to some -- should be focused on driving business technology adoption, rather than purely the acquisition of new systems.

They should also value delivering business results promptly, instead of merely applying inventive product features and functions. Once informed, they'll likely crave low-cost integration into existing business processes, pay-as-you-go pricing, and efficient knowledge transfer.

Given this backdrop, new business technology adoption is often more dependent upon changing behavior than the common prior scenario -- changing underlying technology.

Within this new scenario, the insights and recommendations of trusted peers and independent subject-matter experts supersede all others in the process of choosing a justifiable approach, and supporting key business decisions.

As the co-authors of BTR, we will be on the lookout for resources -- plus proven and repeatable processes -- to speed-up the shift to subscription-based business technology offerings. We'll also highlight the competencies required to enable the facilitation of adoption education and acceleration.

A Call to Action
We invite you to join us in an exploratory dialogue about managed Business Technology services, and welcome contributions of your ideas and associated expertise, as we embark upon this journey together.