Tag Archives: Nicholas G. Carr

Reducing costs is not the only benefit of cloud computing & SaaS

The wisdom of the crowd seems to have decided that both cloud computing and its sibling SaaS are cost plays. You engage a cloud or SaaS vendor to reduce costs, as their software utility has the scale to deliver the same functionality at a lower price point than you could do yourself.

I think this misses some of the potential benefits that these new delivery models can provide, from reducing your management overhead, allowing you to focus on more important or pressing problems, through to acting as a large flex resource or providing you with a testbed for innovation. In an environment where we’re all racing to keep up, the time and space we can create through intelligently leveraging cloud and SaaS solutions could provide us with the competitive advantage we need.

Sameul Insull

Could and SaaS are going to take over the world, or so I hear. And it increasingly looks that way, from Nicholas Carr‘s entertaining stories about Sameul Insull through to Salesforce.com, Google and Amazon‘s attempts to box-up SaaS and cloud for easy consumption. These companies massive economies of scale enable them to deliver commoditized functionality at a dramatically lower price point that most companies could achieve with even the best on-premises applications.

This simple fact causes many analysts to point out the folly of creating a private cloud. While a private cloud enables a company to avoid the security and ownership issues associated with a public service, they will never be able to realise the same economies of scale as their public brethren. It’s these economies of scale that enables companies like Google to devote significant time and effort into finding new and ever more creative techniques to extract every last drip of efficiency from their data centres, techniques which give them a competitive advantage.

I’ve always had problems with this point of view, as it ignores one important fact: a modern IT estate must deliver more than efficiency. Constant and dramatic business change means that our IT estate must be able to be rapidly reconfigured to support an ever evolving business environment. This might be as simple as scaling up and down, inline with changing transaction volumes, but it might also involve ¬†rewriting business rules and processes as the organisation enters and leaves countries with differing regulation regimes, as well as adapting to mergers, acquisitions and divestments.

Once we look beyond cost, a few interesting potential uses for cloud and SaaS emerge.

First, we can use cloud as a tool to increase the flexibility of our IT estate. Using a standard cloud platform, such as an Amazon Machine Image, provides us with more deployment options than more traditional approaches. Development and testing can be streamlined, compressing development and testing time, while deployed applications can be migrated to the cloud instance which makes the most sense. We might choose to use public cloud for development and testing, while deploying to a private cloud under our own control to address privacy or political concerns. We might develop, test and deploy all into the public cloud. Or we might even use a hybrid strategy, retaining some business functionality in a private cloud, while using one or more public clouds as a flex resource to cope with peak loads.

Second, we can use cloud and SaaS as tools to increase the agility of our IT estate. By externalising the the management of our infrastructure (via cloud), or even the management of entire applications (via SaaS), we can create time and space to worry about more important problems. This enables us to focus on what needs to happen, rather than how to make it happen, and rely on the greater scale of our SaaS or cloud provider to respond more rapidly than we could if we were maintaining a traditional on-premises solution.

And finally, we can use cloud as the basis of an incubator strategy where an organisation may test a new idea using externalised resources, proving the business case before (potentially) moving to a more traditional internal deployment model.

One problem I’ve been thinking about recently is how to make our incredibly stable and reliable IT estates respond better to business change. Cloud and SaaS, with the ability to shape the flexibility and agility of our IT estate to meet what the business needs, might just be the tools we need to do this.

The cloud in context: everything new is old again

Nicholas Carr does a great job of putting the current hype over cloud computing into a historical and economic context.

Key takeaways:

  • Cloud is analogous to historical shifts with disruptive technologies
  • Reactions to these shifts have been emotional, but the benefits quickly drove adoption
  • The infrastructure and business models for Cloud computing are now robust
  • The Cloud assumes collaboration which will drive experimentation & innovation
  • Conflict between IT and the business can be overcome in the Cloud

Posted via email from PEG

Innovation [2009-10-18]

Another week and another collection of interesting ideas from around the internet.

As always, thoughts and/or comments are greatly appreciated.

Are we wasting our time searching for the next brilliant idea? That idea that’s going to drive a disruptive innovation. The race for the new-new thing. The innovation silver bullet. Or is innovation the result of combining many small, commoditised ideas? With the real challenge being the identification of interesting problems and synthesis of a new solution from the sea of good ideas we’re swimming in, in today’s hyper-connected world.

  • The good enough revolution: when cheap and simple is just fine [Wired]
    Jonathan Kaplan and Ariel Braunstein made a cheap, feature poor video camera, the Flip. Two years later, the Flip Ultra and its revisions are the best-selling video cameras in the US, commanding 17 percent of the camcorder market. Sony and Canon are now scrambling to catch up.
  • Cheap IVF offers hope to childless millions [New Scientist]
    By leveraging good enough, low tech tools and techniques, the Low Cost IVF Foundation (LCIF) has transformed IVF from a luxury of the rich western countries, into a tool for alleviating the public ridicule, accusations of witchcraft, loss of financial support, abandonment and divorce, not to speak of their own shame and depression associated with being childless in the third world. “If you are not able to conceive, you are not [considered] normal,” says gynaecologist Abdelrahim Obaid Fadl Allah of the University of Khartoum clinic.
  • Forget lawn mowers, bring in the goats [TreeHugger]
    Sometimes the old school solution is the best solution. They chose the goats because they’re a non-polluting alternative that’ll eat up just about anything. “They [goats] can clear vegetation from hard-to-reach places, and they’ll eat the seeds that pesticides and mowing leave behind, preventing vegetation from coming back next year.”
  • Conservative innovation [Nicholas G Carr]
    Many of the of the innovations which drive the corporate world forward are the result small, incremental steps and not large, bold strides based on brilliant, game changing ideas. Toyota’s hybrid is a good example of this incremental, conservative approach.