Cloud business, cloud IT - Bill McNee

Cloud IT and Cloud Business: Going Mainstream

Open World ForumEurosites George VP i FParis, FranceSeptember 22, 2011

Bill McNeeFo nder and CEOFounder and CEOSaugatuck [email protected]

Westport, CT ● Falmouth, MA ● Santa Clara, CA ● Frankfurt, Germany

Copyright 2011 ǀ Saugatuck Technology, Inc. ǀ All Rights Reserved ǀ www.saugatucktechnology.com ǀ +1.203.454.3900

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Accelerating Business and IT Velocity In the wake of the “Great Recession,” businesses of all sizes are

reshaping themselves to better compete in an increasingly intertwined and complex global economy.

Thi i l d thi ki d i ti f i ith i ti This includes rethinking and reinventing new ways of engaging with existing customers, as well as carving out new business opportunities.

Large businesses are waking up! Recent discussions with senior business and IT leaders repeatedly emphasized both the power and thebusiness and IT leaders repeatedly emphasized both the power and the threat of the Cloud – especially around the concept of accelerating “Business Velocity” for firms developing / implementing in the Cloud. Key benefits cited include substantially faster time-to-market and time-to-profitKey benefits cited include substantially faster time to market and time to profit.

In this environment, IT is increasingly being asked not only to help companies save money and facilitate internal process improvement, but to better enable the business to grow with differentiated new products, g p ,services and offerings.

Given this, it isn’t surprising that “IT Velocity” has replaced “IT / Business Alignment” as the top concern for many CIOs.

Copyright 2011 ǀ Saugatuck Technology, Inc. ǀ All Rights Reserved ǀ www.saugatucktechnology.com

g p y

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Cloud IT and Cloud Business

Cloud IT Everything-as-a-Service – with a

focus on cost savings and process

Cloud Business New ways of doing business New business opportunities

improvement: Infrastructure Platform Application

Driven by:Low barriers to entryProven offerings from providers with

viability and visionpp ca o Business Process Integration Management

Disr pti e in IT strateg planning

viability and vision Assimilation, standardization, and

management of CloudPreviously-unrealized levels of business

+ IT integration in funding planning Disruptive in IT strategy, planning, budgeting, buying, and management – therefore disruptive to business strategy, planning, budgeting,

+ IT integration in funding, planning, management, and operations

Key Challenges: Identifying Opportunitiesgy p g g g

buying, and management Key Challenge:The Hybrid Portfolio

Assessing ROI / BenefitsAcquiring Cloud SolutionsManaging Resources (including Partners)

Source: Saugatuck Technology Inc


Source: Saugatuck Technology Inc.,

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Large Enterprise Customers – What are They Doing? CTO Gl b l I f ti P id ( id f ti l d h i t l k t ) CTO, Global Information Provider (wide range of vertical and horizontal markets)

– “Our challenge is to never build another data center. It is a very expensive proposition, and we’d rather not have to do that.”

– “Our focus right now is mostly around the Cloud as a means to provide services internally”.“[The Cloud has] allowed us to drive a level of simplification [and] helped us articulate the [high]– [The Cloud has] allowed us to drive a level of simplification . . . [and] helped us articulate the [high] cost of customization [to the business] that we haven’t been able to do in the past.

– “We are not yet comfortable with the idea of using Public Clouds to provide our services; we think that our customers typically [will] want a throat to choke.”

President Corporate Ops and Technology Financial Services President, Corporate Ops and Technology, Financial Services– “A lot of the differentiation that we had inside [our company] is becoming meaningless now because

Cloud infrastructures are coalescing around a LAMP stack, or some version of it.”– “[With] legacy . . . there will be a slow migration to technologies that are equivalent to Cloud and, as

Cloud continues to decrease in cost, the semi-private and public clouds will start to receive more workloads in the 5-10 year timeframe.”

– “As it concerns the ‘new,’ people are going to implement completely in the Cloud or using Cloud-like technologies from the get-go.”

VP Global Strategy, Customer Communications Management Provider– “The old way of doing product development has been very structured and routine and isn’t going to

work [in the Cloud].” – “The whole concept of agility that is required to get new businesses up can be dealt with so much

easier in the Cloud, both in terms of the underlying technology and product development. It is way easier to bootstrap a new offering by leveraging the inherent pay as you go pricing of the Cloud ”


easier to bootstrap a new offering by leveraging the inherent pay as you go pricing of the Cloud.

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Key Trends T d ’ i it ti ti t f th Cl d d i b b i th t Today’s economic situation continues to favor the Cloud, driven by businesses that are

reshaping themselves as the global economy recovers from the Great Recession. The Cloud – including SaaS, PaaS, IaaS and Cloud Services – will drive increasing

business and IT activity, resulting in hybrid architectures to manage, a new Cloud IT mission, and the launch of Cloud-enabled Business Services by traditional businesses.

Through 2015, SaaS will continue to dominate Cloud IT spending, including business apps, social computing and mobility solutions – key aspects of the boundary-free enterprise.– BI joins CRM, Customer Service, Collaboration and SFA as the leading Cloud Business Solutions in j , , g

demand through 2012. Financial Analysis / Planning and HR rising dramatically in investment priority.– Big Data and Advanced Cloud Analytics become key drivers of Cloud solution demand.

Enterprises will increasingly leverage PaaS platforms and ad-hoc aggregations of Cloud Services across the stack (through the use of APIs) to build composite Cloud solutionsServices across the stack (through the use of APIs) to build composite Cloud solutions. – This includes Cloud services such as SaaS and IaaS, as well as powerful Social Business and Mobile

Commerce technologies that are increasingly imbedded directly into critical business workflows.– Private Clouds are gaining traction – especially at large enterprises wishing to maintain control.

Integration and workflow in the Cloud will remain a critical capability and requirement Integration and workflow in the Cloud will remain a critical capability and requirement, especially for hybrid large enterprise environments.

Cloud Services Providers (including Cloud Enablers and traditional service providersaggressively pursuing the Cloud) will flourish – as they increasingly incorporate Open S d C dS i t t i d b S S P S I S d BP S


Source and CrowdSourcing strategies and embrace SaaS, PaaS, IaaS and BPaaS.

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Saugatuck’s Cloud EcoStack™What Is It? What Is In It? Who Is In It?

Level 4

Cloud Business Services and Operations

Business Process Outsourcing, Managed

Services, Systems Integration, Related

Accenture, Appirio, Cognizant, Comcast, IBM, Infosys, Perot / Dell, SAP, Symantec, Tenzing, Verizon Wipro

Level 3 Cloud Business Solutions

Software -as-a-Service (SaaS)

ADP, Ariba, Adaptive Planning, DellHost Analytics, Intacct, Microsoft,NetSuite, Oracle, Salesforce, SAPSuccessFactors, Symantec,Taleo Workday

and Operations gServices

Verizon, Wipro

Level 2 Cloud Platforms & Hubs

Platform -as-a-Service (PaaS), Hosted services (e.g., analytics, business services, app dev, DBMS,

i t ti it )

Accenture, Amazon, Apprenda, Dell Boomi, Google, HP, IBM, Joyent,Microsoft, OpSource, Oracle, ProgressRackspace, SafeNet, Salesforce,S i S S ib VMW

,

Taleo, Workday

Level 1

Cloud Infrastructure Services

Infrastructure -as-a-Service (IaaS) / “Cloud

Computing” (e.g., computing storage)

Amazon, AT&T, HP, IBM, Joyent,Layisys, Microsoft, Navisite, NTT,Opsource, Peer 1, Rackspace,Savvis, Verizon, Wipro

integration, security) Savvis, Servoy, Scribe, VMWare,

Level 0 Cloud Technologies

Basic hardware, software, networking,

and services

Cisco, Dell, HP, IBM, Intel, Microsoft, OpenStack, Oracle, Red Hat, Ubuntu, VMWare

computing, storage) , , p




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Open Source in the Cloud EcoStack™

Open Source Roles & Influence Through 2014:• Open source will provide low-cost building blocks, integrated

within providers’ core technology stacks and solutions- Enabling low-cost functionality at all layers while encouraging

Cloud Business Services and Operations

Enabling low cost functionality at all layers while encouraging independent development – and fragmentation

• LAMP Stack will be the de facto SaaS / Cloud provider technology platform for Cloud services and providers

- Linux Apache MySQL PHP & Ruby

Cloud Business Solutions

- Linux, Apache, MySQL, PHP & Ruby • Community-driven global innovation in technologies and

applications will support Cloud provider evolution• HOWEVER: Technology standards fragmentation, and open

it t ib ti d l ill ti t h ll

Cloud Platforms & Hubs

community contribution models, will continue to challenge widespread standardization and profitability for open source software developers and providers

- Any vendor domination is unlikely and impracticalCloud Infrastructure

Services- Cloud represents a tremendous opportunity for open source

developers and providers (globally)- Opportunities will continue to follow core technology threads

instead of commercial vendor ecosystems Cloud Technologies


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The Evolving Cloudscape

Through 2015, the largest driver of Cloud IT workloads will continue to be Cloud Business Solutions (including business apps, social business technologies and mobile solutions).Key drivers shift from “better, faster and cheaper” to “transforming the enterprise.”

The Rise of Cloud IT and Cloud BusinessHigh

Wave I: 2001-2006Cost-Effective

SaaS 1.0Wave II: 2005-2010

Integrated

SaaS 2.0Wave III: 2008-2013Workflow-Enabled

Cloud IT EraWave IV: 2011-2016

Measured, Monitored, Managed

optio

n

Cost EffectiveSoftware Delivery

IntegratedBusiness Solutions

Mainstream SaaS Adoption

Business Transformation

Ubiquitous SaaS AdoptionFoc s on B siness Transformation

Post-SaaS Adoption• End-to-End Cloud Business Processes• Intelligent Hubs Linking Platforms• Virtualization on Mobile Devices

, , gBusiness Processes

Cloud ITGestation

Period• SaaS Remains Core

Ado

Early SaaS Adoption• Stand-alone Apps• Multi-tenancy• Limited Configurability• Focus on TCO / rapid deployment

Mainstream SaaS Adoption• Integrated w/ Business• SaaS Integration Platforms • Business Marketplaces

and SaaS Ecosystems• Customization Capability• Focus on Integration

• Focus on Business Transformation• ISV to SaaS Enablement • Server and Application Virtualization• SaaS Development Platforms (PaaS)• Public Cloud Infrastructure (IaaS)• Cloud Collaboration Platforms• Customized, Personalized Workflow

• Virtualization on Mobile Devices• Elastic Cloud Infrastructure• Standards for Workload Portability• SLAs for Composite Service Offerings• Support at Business Process Level

• PaaS Enables Composite Solutions• IaaS at the Margins (because lack of standards)

• Mobility, Collaboration and

S S t k T h l

Low

deployment

2006 2007 2008 2009 2010 2011 2012 20132004 2005 2014 2015 20162003

Social Business technologies Explode


Source: Saugatuck Technology

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After the Storm – The Shift to the Cloud Accelerates

By 2015, 50 percent or more of NEW enterprise IT spend will be Cloud-based or Hybrid. By 2015, 65 percent or more of NEW enterprise IT workloads will be Cloud-based or Hybrid.By 2015, 25 percent or more of TOTAL enterprise IT workloads will be Cloud-based or Hybrid.

< 100 Employees2010 2012 2014

But significant differences in adoption by size of company!

70.0%

For each of the following years, please indicate what percent of your company's preference for deploying NEW

software (on a continuum from Cloud-based to On-premise) will be:

Cloud-based (Public) 26.5% 34.5% 43.6%

Hybrid Cloud 17.7% 23.8% 22.5%

On-premise 55.7% 41.6% 33.9%30 0%

40.0%

50.0%

60.0%

On premise 55.7% 41.6% 33.9%

5,000 + Employees2010 2012 2014

Cloud-based (Public) 17.0% 24.5% 34.6%0.0%

10.0%

20.0%

30.0%

2010 2012 2014

S S t k T h l I 2010 Cl d IT S (S t b 2010) Gl b l N 546

( )

Hybrid Cloud 17.5% 24.7% 27.3%

On-premise 65.0% 50.8% 38.1%

2010 2012 2014

Cloud-based (Public)

Hybrid Cloud / On-Premise (Public or Private)

On-premise


Source: Saugatuck Technology Inc., 2010 Cloud IT Survey (September 2010), Global N=546

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Cloud IT Solutions in Production SystemsToday Through 2013

How soon do you expect to see your company acquire

Through 2012, Collaboration, Mobility and Social Business technologies will lead all forms of Cloud IT deployment.

55% 20% 5%Collaboration Tools and Capabilities (email Web conferencing et al)

How soon do you expect to see your company acquire the following Cloud IT solutions for use in production

systems? Obvious top tier now thru 2013+; maps to historic SaaS data

28%

28%

24%

25%

9%

10%

Cloud Infrastructure (Compute, Storage, et al)

Software-as-a-Service or SaaS / Cloud Business Solutions (Finance, HR, …

(email, Web conferencing, et al)SaaS data

SaaS, IaaS and ESC are neck-and-neck

20%

36%

24%

19%

9%

6%

Platform-as-a-Service or PaaS (Apps Development Integration Mobile mgmt )

Social Networking

et al)

Widespread Cloud-based In-house

and neck

0% 10% 20% 30% 40% 50% 60% 70% 80%

Development, Integration, Mobile mgmt.)

In Use/2010 Planned for 2011-2012 Planned for 2013 +

development by user enterprises is not a given

S S t k T h l I 2010 Cl d IT S (S t b 2010) Gl b l N 546


Source: Saugatuck Technology Inc., 2010 Cloud IT Survey (September 2010), Global N=546

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Key Challenges / Common Pitfalls for Mid-to-Large Enterprises

Key Challenges:– IT Asset Management– Understanding and Managing Risk (business and technology)Understanding and Managing Risk (business and technology)– Integration: Data, Security, Processes (internal and external) – Opportunity Recognition and Execution

Common Pitfalls in the Cloud Transition: Common Pitfalls in the Cloud Transition:– No formal planning process– Missing or poor governance structure– Poor or missing responsibility matrixPoor or missing responsibility matrix– Neglecting or underestimating HR and change management challenges– No project management office (PMO) – Missing or incomplete inventory of assets– Lack of operational oversight – Few relevant SLAs– Poor communication to constituencies




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Summary

Cloud Business

Cl d ITCloud IT


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