When TELUS Customer Solutions Architects David Steele and Nathan Roarty talk about today’s IT management reality, they reference the concept of drawing your lines in the sand. In previous posts, they explain how the concept can be applied when making IT management decisions about cyber security and technology refresh.
But what about cloud? As more and more companies contemplate or pursue the shift, David and Nathan share their insights about the small decisions that can contribute to new ways of managing IT by capitalizing on the cloud.
Q: How do you define cloud within this context of drawing the IT management line in the sand?
DS: In this context, cloud means moving away from owning a piece of equipment or technology toward buying capabilities as a service. Typically, the shift to cloud is a financial and risk-driven decision originating outside of IT. But the implications to IT are numerous and must be considered. New skills are often required to adjust to a new way of doing things. There are alterations to cost models. And risk is distributed differently.
NR: Traditionally when planning an IT procurement, organizations factor in peak usage and growth, and size their environments to meet those needs. For example, if you are a large retailer running an ad during the Superbowl, it is important to make sure your environment can take the load resulting from the exposure. However, it is challenging to determine exactly what that load will be. It is a similar scenario for growth. IT often has to predict needs 18 months to two years out and invest accordingly based on some data and a lot of guessing. The implication for many companies? They often end up procuring more capacity than they need. In the past, it would not have been unusual for an organization to see an average utilization of 10 to 15%, while still paying for 100% of its IT investment, all of the time.
Cloud services have established a utility model for consuming IT resources and services. The pay-as-you-go model can be applied across the IT services stack, ranging from compute and storage resources to comprehensive software-as-a-service offerings. Where you draw your IT management line in the sand depends on the nature of the service that you are consuming.
Q: Much of what we read about cloud talks about shifting focus back to core competencies. What is your take on that idea?
DS: Operating in the cloud does require two specific sets of skills. First, you need migration expertise so you can transition to the cloud effectively. Then you must ensure that your business is optimized for ongoing cloud operations by adding capabilities including utilization monitoring and establishing best practices. Many companies struggle with letting go of niche skills and replacing them with more generic capabilities. When moving to the cloud, it’s important to look at the profile of your IT skills and determine what you actually need for this new way of operating.
NR: We are seeing organizations look to cloud providers to provide solutions including fleet tracking, cyber security, DDOS scrubbing and file sharing. It often doesn’t make sense to invest in technology and skills to enable those solutions when there are service providers that solely focus on providing those enterprise-grade services. If you choose to cloud enable certain solutions and capabilities, it’s important to have people within your IT organization that can support those cloud services. For example understanding the privacy and security implications of a cloud-based service is critical to effective ongoing operations.
Q: What is the reality around spending?
DS: The typical discussion around cloud and spending focuses on capex vs. opex. But there is an interesting thread here that many people don’t often reference. The savings typically associated with transitioning to an opex model don’t come automatically. There is an investment required to adapt your business to cloud-based operations, which doesn’t follow a traditional “lift and shift” upgrade.
NR: Organizations that want the advantage of operational cost savings must realize that those savings correlate directly to optimizing cloud operations. For example, if you’re choosing Amazon Web Services to host servers and apps, you have to be aware that it’s a complex pricing model. Deploying your application to run on the best Amazon components can help you optimize performance and costs. It’s also important to point out that not all businesses focus on saving capital. Governments are a good example. Many government organizations choose the on-premise model because of their need to maintain control and reduce certain risks such as privacy.
Q: What is the liability line in the sand?
DS: As soon as you move to the cloud, your solution or hardware is no longer within your four walls. And there is a liability associated with that. When you have technology sitting in your data centre, on your equipment, you have control over those operations. As you move to the cloud, you are shifting liability to a service provider. Service Level Agreements (SLAs) help to manage the liability, but you do give up some sense of control.
NR: Ultimately, the liability is that you’re still liable. Cloud provider service levels give you a certain amount of assurance, but your customers still look to you when problems arise. I believe that companies aim to make the best decision possible at the time they make it. But moving to the cloud does not divorce the decision maker from the associated implications and outcomes. PCI compliance is a great example. For payment services, many companies rely on a cloud service provider that adheres to PCI compliance, which is a great way to manage financial transaction data liability. But there is a flip side to that as well. Migrating a service to the cloud and moving data with it does not remove an organization’s liability for the privacy implications of the data it handles. It also ties into regulation. When you embark on any cloud journey, it’s vital to be aware and remain diligent about your compliance requirements.
Q: What is an often-overlooked opportunity with cloud?
DS: With cloud, you’re not just drawing the IT management line in the sand you’re actually moving it completely. Deciding how much of your technology stack you own and how much you entrust to an expert is an exercise in gaining insight. With that insight, you optimize your IT organization in new ways by adding new levels of flexibility and adaptability.
NR: Flexibility and adaptability don’t come free. There is an investment in time, money and strategy required to enable that shift. Irrespective of the outcome – whether you adopt cloud or not – there is a benefit to going through the consideration process. You gain insight into the skills you have and how you want to deploy them, how you want to spend money and what liabilities you really want to take on. In this case specifically, the act of planning a cloud services adoption can be more valuable than the actual plan to move to cloud services.