Five Proven Benefits of Cloud Services

How can your company get started with cloud computing? Well, consider following the market leaders. With a few more months of client experience, Forrester Research recently addressed the major questions that executives have about the adoption of cloud services.

The key benefits that most early adopters report do not start with costs -- but rather with business flexibility. According to those that have deployed it, the benefits of cloud computing, in order of importance, are:

1. Improving time-to-application deployment. Cloud platforms give you the option of developing and deploying new applications on existing infrastructure as quickly as desired. Traditional platforms can take up to three or four months to procure, install, and configure, stalling the application deployment process.

2. Aligning IT budgets with application demand. How many Web applications does your organization deploy without exactly knowing how popular they’ll be or how much capacity you’ll need to accommodate that popularity? Many of the early cloud adopters host customer and public-facing Web applications with cloud providers for this reason. They can pay just for the resources they use, hour by hour.

3. Accommodating peaks in demand for data center capacity. Cloud computing is also good for handling episodic spikes in demand for computing, storage, and network resources. Rather than provision for the expected peak of the holiday shopping season, retailers can push the additional demand into a cloud environment. Big batch jobs also fit this model.

4. Delivering applications without raising the budget. Cloud computing gives you the ability to deliver new applications without having to buy systems, avoiding an investment of your firm’s capital in new equipment. Application development and delivery can all be handled using pay-as-you-go operating expenses.

5. Sharing without putting the data center at risk. Many of the early adopters of cloud computing are looking for an inexpensive and easily accessible way to share information. Medical researchers are an example. Cloud services enable these organizations to host data on public clouds, rather than making their internal data center available to external parties.

Three Questions to Ask a Cloud Service Provider
How do you know if a managed cloud service provider is a good-fit for your business? Forrester concludes that you should ask all providers the following three basic questions:

• What are your enterprise references and what kinds of applications do those organizations run in your cloud?
• For which application scenarios does your cloud environment deliver the maximum flexibility and scalability?
• What security and reliability commitments do you make to your customers?
  

The Secret of Business Growth in 2010

Having had their fill of the economic downside, business leaders are truly ready for the eventual upside. Apparently, U.S. companies are preparing for a global economic recovery to begin in the first half of 2010, according to a new "Road to Growth" market study from AT&T.

Key study findings include the following insights:

Business Agility and ROI Pressures
In today's economic climate, U.S. companies have significantly shortened the time frame over which a Return on Investment (ROI) is delivered.

More than half of U.S. IT executives stated they are under pressure to deliver a return on investment in half the time than their previous efforts. As a result, two-thirds cited that the change has affected their IT budgets, strategies and priorities.

The study found that companies are less willing to invest in longer-term projects -- where the return does not come quickly. One CIO stated that IT projects must give at least a 100% ROI in 12 months -- otherwise, the project is terminated.

Shrinking Costs, While Growing the Upside
No surprise, regarding the top-of-mind challenges. Cost cutting and increasing revenue remain the two primary business goals. To achieve those objectives, survive the recession and move towards growth, business technology strategies are focused on:

Reducing operating costs: 87 percent cited "reducing operating costs" as "extremely or very important." Improve collaboration with customers and partners: 85 percent cited "improved collaboration with customers and partners" as "extremely or very important." Enhancing workforce performance and productivity: 83 percent cited "enhancing workforce performance" as "extremely or very important."

Rise of the Any-Term Business Strategy
The study found that U.S. companies employ multiple strategies to address business goals, and do not distinguish between short-term and long-term strategies. It appears that U.S. companies are reducing the time period for their long-term forecasting until after the recession is over.

Moreover, the role IT plays in helping U.S. companies achieve long-term strategies is very similar to the role IT plays in supporting a company's short-term business strategies.

Ongoing Role of Business Technology
IT investments and priorities are very focused in a couple of key areas. The study found that "business continuity and security solutions" will have the biggest positive impact on business growth as U.S. companies prepare for an economic turnaround.

This is closely followed by "enterprise mobility solutions" and "Web delivery solutions." Areas of IT investment that are expected to have a high to moderate impact on businesses are "unified communications services" and "hosted solutions."

For more information, and a copy of the executive summary, visit the AT&T Road to Growth Study on their website.

Managed Service Buyer Checklist – part 2

The following are questions four through seven of a ten-point Q&A designed to help guide your managed or hosted service procurement process. Here are the first three buyer questions and service provider answers.

4. What is the depth and breadth of your current managed service portfolio?

• A service migration path provides the means to adapt to your growth needs.
• Service providers that are specialists may offer services through their partners.
  

It helps to have a forward-looking view of your needs when selecting a service provider. Sometimes a specialist is preferable to a multi-service provider. Otherwise, try to anticipate future service requirements, and consider giving preference to a provider with those combined skills.

5. How can I be sure you will apply the best people, processes, and tools? Is your company certified by a leading vendor, and are your offerings delivered using industry-leading technologies to meet the highest quality of service?

• Service providers have data on how they've qualified to meet standards.
• Providers are often required to attain a "qualification level" that is tiered.
  

The good service providers will achieve basic industry-standard technical certifications. The better service providers will comply with the ITIL foundation practices. The best will have passed the stringent qualifications of a service designation process that requires an independent third-party audit of their performance. They must pass rigorous annual assessments of their network operations center. Technical design and operations staff must also complete advanced training.

6. Where are your network management facilities located, and what are the hours of operation? Describe your escalation process, in the event of an outage.

• Service providers typically have both primary and backup facilities.
• Find out whom to contact when your primary support contact is not available.
  

Depending on your needs, service support during regular business hours may be enough. However, some businesses have requirements for 24-hour operation. Help desk coverage, staffing levels, and backup planning are important aspects to consider in this scenario.

7. What are the assurances for levels of availability, serviceability, performance, and operation? What is the process for remedy if and when levels aren't maintained?

• All service providers establish and maintain benchmark measurements.
• Service contracts detail the metrics, and references have results data.
  

It is now common for service providers to offer service-level agreements (SLAs) as an integral part of a service contract, where the "level of service" is formally defined. The SLA can include the common understanding about services, priorities, responsibilities, and guarantees -- sometimes specifying financial remedies as a result of failure to comply with SLAs.

Next step: The remaining Q&A will be featured in part 3. We'll also provide a link to a complete list, and an ROI calculator to help you start to build a business case.