Altabel Group's Blog

In the cloud: which is right for you?

Posted on: July 30, 2012

Cloud computing is not a buzzword, it has become reality for many companies from SMEs to large organizations: as analyst Quocirca reports in their Cloud findings this year: a substantial minority out of 900 business respondents see cloud computing either as a “passing fad” (8%) or as something that had “no place in the future of my organization’s plans” (11%).

The benefits of cloud computing have been discussed back and forth:
-With cloud services you gain mobility and real-time visibility of your metrics. Without the need for servers, hardware and software installation, data can be accessed from any location that has a Web browser and an Internet connection.
-Cloud-based business applications can be thoroughly and easily integrated with existing programs, such as Microsoft Outlook or Excel or Lotus Notes, and mobile devices like BlackBerrys, iPhones or other smartphones.
– For middle-size and large companies with a tree of various depts and units cloud services mean streamlined functionality across all departments and facilitation of interdepartmental communication.
– Small firms and start-ups couldn’t afford some services and software so far. With cloud services they can now get use and advantage of them as this costs less, the cost is fixed and predictable. Most cloud computing applications are pay as you go, and it can be purchased only necessary part of the cloud services package for a certain even short period of time.
– Cloud computing resources can be scaled up or down as required along with the organization’s size fluctuation or coping with the company’s occasional peaks in demand.
– By using of computing resources delivered over the internet, the business is able to save money, replacing hefty capex with predictable opex.
– Burden of day-to-day IT administering responsibilities is taken off the shoulders of the business in case of using public cloud services.

The good thing about cloud is that almost each company or organization can find the right one for themselves. To figure out what form of cloud suits the business you should start with an analysis of the existing state-of-play and an assessment of your future needs. Also what works for a particular organization will depend on the characteristics of that organization: how large it is, which vertical sector it’s in, what investment it’s already made in infrastructure and how complex its IT needs are. This initial piece of analytic job will be valuable by itself since it paves the way for a strategic approach to cloud resulting in long-term cost savings and greater agility.
For larger organizations who would like to develop a cloud strategy, the picture is more complicated. As statistics of 2011 shows 45% were already using cloud for sourcing some IT services, principally for cloud’s “speed of provisioning, flexible capacity and demand management benefits.” So they have already invested heavily in infrastructure, and the scale benefits will not be as easy to realize as for a smaller organization.

Basically there are several attractive options of moving to the cloud:
1/ a move to the public cloud, which provides economies of scale and a move from a capex to an opex payment model;
2/ development of a private cloud, which enables to save money by rationalizing infrastructure and providing services on a hosted basis;
3/ a hybrid model, in which the private cloud is used as the basic method of delivering applications and services, but mixed with functions and services from the public cloud, where it makes sense to do so (for example, if that function would be expensive or complicated to provision internally.)
4/for public sector organizations, it may be also collaboration with other organizations to adopt shared services. In UK the example of this model can be the emerging G-cloud.

Naturally all the models can co-exist within the same company or organization.

Public cloud is a standard cloud model in which a business hires its computing resources from a large provider such as Amazon.
As an alternative, private cloud may be adopted, run either in-house or by a third party. Although private clouds lack the scale benefits of a public cloud, they do provide organizations with greater control over their data. Private clouds also provide an opportunity for organizations to take a good look at their current software use and to take steps to manage it more effectively. “In some cases there’s a degree of transformation that needs to take place, and quite often investment in private cloud is the instigator for that transformation that needs to take place,” Ovum analyst says. “Very many organizations need to rationalize their applications footprint before since they are simply supporting too many applications, too many versions, too many releases, across the organization.”
In reality it need not be an either/or choice between public and private cloud. Some experts believe that a hybrid cloud model combining private and public clouds will be an increasingly popular and workable model in future.
There exist even more diverse choice for public sector organizations. One is shared services, in which different public sector organizations pool their IT resources to deliver back office functionality. Several shared services initiatives are already underway. There are currently about 200 shared services projects in operation in local UK government, for instance. One of them is NHS Shared Business Services (NHS SBS), a joint venture between the Department of Health and Steria, that offers back office services such as finance & accounting and payroll & HR to NHS trusts.
Again in UK, the really big initiative in the public sector is the government’s £4.9m G-cloud program, which it expects to save £120m between 2014 and 2015. The G-cloud is a private, government-controlled cloud that will offer four categories of IT service (infrastructure, software, platform and specialist service) to central government departments, local authorities and other public sector organizations. Currently each government department has its own set of IT systems performing similar functions, so there is needless duplication of functionality and therefore it makes sense to develop or purchase a single application that can be scaled across multiple councils than for each council to buy its own application.

And what about your company – is cloud computing already your choice of the day? Then which cloud model do you get use of?

Interested to hear your thoughts🙂

Thanks in advance,
Helen Boyarchuk
Altabel Group – Professional Software Development

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