Tag Archives: business strategy

Five Questions Boards Of Directors Need To Ask About Cloud Governance

BOD-cloud-questionsThe many benefits of cloud computing include helping enterprises become more efficient, agile, innovative and flexible, but achieving those benefits depends on a number of factors, including the involvement of the board of directors. ISACA, a nonprofit, independent association of more than 100,000 governance, risk, security and assurance professionals worldwide, has issued new guidance outlining key questions for boards of directors to ask to ensure their enterprise’s cloud initiative is in line with business objectives and the organisation’s risk tolerance.

“Board members need a clear understanding of cloud computing benefits and how to maximise them through effective governance practices,” said Marc Vael, CISA, CISM, CGEIT, CISSP, an ISACA board member and chief IT audit executive at Smals.“This requires the board to see cloud computing not as an IT project, but rather as a business strategy.”

According to ISACA’s Cloud Governance: Questions Boards of Directors Need to Ask, boards should address the following five questions to determine the strategic value that cloud services are expected to provide and the impact that the cloud may have on resources and controls:

1. Do management teams have a plan for cloud computing? Have they weighed the value and opportunity costs?

2. How do current cloud plans support the enterprise’s mission?

3. Have executive teams systematically evaluated organisational readiness? For example, are the right skills available? Do cloud processes conflict with other established processes? Do cloud plans conflict with enterprise culture?

4. Have management teams considered what existing investments might be lost in their cloud planning? Does the adoption of a cloud service nullify already-made technology investments that have not reached their planned end date, and is that noted and approved?

5. Do management teams have strategies for measuring and tracking the value of cloud return vs. risk?

“The answers to these questions will help determine the enterprise’s readiness to adopt cloud computing and also help ensure that the necessary governance is in place,” said Vael. “The COBIT 5 framework for governance and management of IT can also help enterprises manage investments such as cloud services. COBIT 5 helps ensure consistent practices to maximise value and manage risk.”

ISACA’s white paper, “Cloud Governance: Questions Boards of Directors Need to Ask,” is available as a free download at www.isaca.org/cloud-governance. The COBIT 5 framework is a free download at www.isaca.org/cobit.

 

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Cloud Computing Key To Business Success

A massive 93% of financial decision makers believe that cloud computing will be important to the success of their businesses over the next couple of years, according to research.

Vanson Bourne questioned 100 senior executives within the finance departments at UK companies for the research, which was commissioned by Google.

It also found that 68% of businesses surveyed had either already implemented cloud services or have plans to.

A total of 66% makers believe the cloud increases the IT department’s contribution to corporate strategy and 69% believe that cloud computing increases the IT department’s ability to innovate.

The importance of cloud computing to business strategy means the finance departments will get more involved in IT decision making. The research found that half of the finance executives believe that, as cloud computing becomes a business strategy, the CFO will have more influence over IT decisions.

Of the surveyed executives, 94% believe that cloud computing provides their business with quantifiable benefits, while 64% said cloud computing is more beneficial than traditional outsourcing

“To date, enterprise cloud adoption has been largely driven by the IT function. However, today we see ourselves having more discussions with CFOs, COOs and CEOs and it is not hard to see why. The benefits of cloud computing go far beyond the obvious cost savings on software and reducing the burden of maintenance,” said Thomas Davies, Head of Google Enterprise for the UK and Ireland. “The strategically significant role it can play within an organisation in terms of driving innovation and productivity is making it an increasingly attractive option for businesses that want to remain competitive and agile.”

What are the benefits of the cloud?

44% – reduced IT maintenance costs
47% – reduced IT spend
47% – reduced operational costs
34% – improved process efficiency

Author: Karl Flinders
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Reasons To Include The Cloud In Your Business Strategy

The issue of success or failure in moving your company data, IT storage, servers or software to the cloud is often driven by technical issues, including performance, bandwidth, security and total-cost-of-ownership (TCO) considerations. While many of these factors are key criteria for selecting cloud solutions, they usually don’t align with the bigger picture that C-level executives must consider when adding new IT solutions.

How IT can help sustain or create a competitive advantage has never been more apparent than today through the use of cloud computing. This technology boasts benefits such as reduced costs and scalability, just to name a few, but many companies fail to find the right fit for cloud within their business. [Disclosure: The Open Group is a sponsor of BriefingsDirect podcasts.]

This is because cloud computing is not ‘one size fits all’. Performance, network bandwidth, security, and total cost concerns can be allayed through a better portfolio and investment approach that considers the multitude of options available.

How cloud computing fits

In industries where working capital bears a high price and is in short supply, businesses often have to make ends meet and have limited investment available. Therefore, being able to source the lowest cost and drive efficiencies even further is critical to growing business and market share.

For companies with limited working capital resource or cash flow funds, the use of on-demand services becomes an attractive option for consumers to avoid upfront costs or maintenance of services. Likewise, companies seeking to provide better profitability from their operation and vendors managing their cost center can leverage on-demand models to target areas of their portfolio to reduce cost and maximize return.

When adopting cloud computing, companies are often driven by cost effectiveness, rather than looking at the bigger picture and asking what cloud solution is the best fit for the business. Cost savings, longevity of product, and performance aren’t mutually exclusive, and all should be factored into the decision-making process when researching and purchasing a cloud solution.

Here are four questions, which include key metrics and drivers, to ask when researching cloud solutions that will maximize the value of cloud computing for your organization:

Why is investment being spent on areas of IT that are not differentiating your business and can be commoditized?
Key Metric: The balance of percent of investment on non-core commodity IT
Key drivers: TCO needs to consider where to focus IT investment

How can IT grow and adapt with the ever-increasing expansion of data storage and the growth of computing demands eclipsing on-premise facilities?
Key Metric: The cost of storage and archiving , recovery and continuity
Key drivers: Latency of network and storage costs can be targeted through considering the whole IT portfolio, not just niche use cases of cost-performance. Look at the bigger picture.

How can access to new markets and new channels be better served through extending networks and partnerships?
Key Metric: Size of markets and effectiveness of sales channels, both internal sales and external direct sales and reselling
Key drivers: Total cost of acquisition can include the creation or use of third-party distributed marketplaces and self-service portals and platforms

Is your own IT fast enough to beat your competition or drive the cost savings or revenue and margin growth plans you need?
Key metric: Speed of IT delivery and its cost and quality of service.
Key drivers: Performance can be offered through selected service provisioning. Question whether all knowledge needs to be in-house. Skills can be as-a-service too.

Author: Dana Gardner
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Paving a Pathway Into The Cloud

Before spacecraft are blasted off into space, the astronauts that travel in them, mission-control personnel, and other key staff undergo specialised education and training, launch procedures are verified and rehearsed, and policies are drawn up so that everyone is clear about their roles. Organisations wanting to move into the cloud computing space need to employ similar rigour.

Although cloud service technology is easily available and is a potential business game-changer, it is best for enterprises to not plunge straight into it without a well thought out plan. First, be clear on your business strategy and what the specific drivers for change are. In the current climate many are prioritising on growing business revenue, reducing operational costs, and winning new customers. The correct use of cloud computing services may well be able to support these goals.

Understanding what cloud computing is all about will help organisations to identify its potential business value. In its purest form cloud computing is simply a style of computing delivery and not a technology as it is sometimes perceived. Resources such as compute power, storage assets, applications etc. are virtually pooled and delivered as services which are shared by many other users and organisations. This form of economical sharing of IT resources is often referred to as the multi-tenancy model.

Cost savings

Cloud providers build large data centres employing multi-tenancy infrastructure with massive scaling capability, giving their customers significant cost savings. Paying only for what services you use in cloud computing is what often sets it apart from traditional IT outsourcing when it comes to contracts and pricing. In cloud computing, when a user needs IT resources, he/she provisions them from the available resource pool, uses them as long as needed and, typically, pays for them based on usage and not in the form of a fixed charge. When the resources are no longer needed, they are returned to the pool.

It is important to understand that such sharing, while highly cost-effective, often brings with it security and data protections concerns. Despite efforts being made to assure customers of public cloud security, many organisations seek the benefits of the cloud delivery model without using shared public services. The logical solution to such concerns is a private cloud, where organisations duplicate the efficiency of the public cloud model, but build the cloud inside their protected premises. Many organisations are figuring out whether it makes sense for them to use public or private service; others feel a hybrid approach is the best solution.

Cloud types

Commonly cloud services are delivered in three configurations: Software as a Service (SaaS), in which users have access to shared commodity-like applications hosted on an internal or external cloud infrastructure; Platform as a Service (PaaS), essentially software and services running above the server operating system such as development tools, databases, middleware, authentication and security software; and finally Infrastructure as a Service (IaaS), which enables organisations to self-provision base operating systems such as Windows and Linux, thus eliminating the long waiting times for purchasing and installing physical servers.

The cloud computing connectivity model breaks down into four types: private, public, hybridand community cloud. A private cloud as previously mentioned is installed on business premises running on the internal corporate network and is an exclusive resource. A public cloud is accessible from routable worldwide Internet connections, with infrastructure and services shared with potentially thousands of customers. A hybrid cloud is a carefully selected blend of public and private services; powerful hybrid cloud use cases occur in functionality such as “cloud bursting”, where excess workloads are transferred to an external cloud to be processed. Finally the less well known “community cloud” is a collection of clouds between organisations where a level of trust or grouping exists between the entities.

Besides providing better alignment of cloud computing with business goals, the preparatory effort prior to cloud entry also gives an organisation the opportunity to improve its process framework. Invariably, internal business processes related to SLA, service management, incident management, disaster recovery, and so on will need to be tweaked, especially for public cloud utilisation.

The case for cloud

The last few years have seen thousands of use cases emerging that prove that, in the right circumstances, cloud computing does pays off significant benefits. Cloud computing services underpinned by an efficient virtualized architecture present all types of end-user companies –and cloud providers themselves – with a powerful competitive engine to respond to the most demanding business needs.

How each organisation develops its strategy for the cloud transformation journey will determine their ultimate return on investment – and maybe even survival. Their choice of cloud model, the underlying technology, and the consulting and implementation partners’ pedigree will be major factors in that journey to efficiency and business agility. In addition, never underestimate the importance of bringing on board business users early to provide key business input in the development of your cloud roadmap.

Like it or not, the pressure to be part of the private, public or hybrid cloud movement is there. Those that do not adopt it or adapt to it will find themselves probably in some sort of difficulty growing the business and staying viable. In the last couple of years, it’s been quite easy to hide a little bit behind the hype, so to speak. Not any more – we’re in a new world again and that future for now is Cloud Computing.

Laying the virtual foundation

In planning the journey to a private cloud implementation a well architected combination of server, network, software and storage virtualization layer is an essential design consideration. A resilient and performance-orientated cloud environment should include stringent automated IT operational security controls and effective monitoring and alerting, with high-availability failover capabilities in place.

Another key element of cloud computing is consumer cloud self-service. In cloud computing savvy business departments needing resources simply browse and select from a service catalogue, configure, add to the shopping cart and click to agree to pay a fee. Each month an invoice is generated for the consumer as a chargeback, giving visibility of just how much resources are consumed. In an ideal world cloud self-service should be a CIO’s automation dream. Though often successful when controls are in place, poorly designed self-service capability could lead to more headaches than it set out to solve if users go on an endless shopping spree for limited resources.

Public cloud considerations

Organisations looking at adopting public cloud computing also need to bear in mind that most cloud services are commoditised. Thus the luxury of determining every detail you have on your in-house infrastructure and middleware may not be available in all cases in public clouds. For many company applications and services this may not pose any form of a barrier or restriction. However, it becomes a key point when considering moving applications to external clouds. When developing a business case justification for using public cloud services, carefully analyse the SLA with the future cloud provider and the legal and process aspects of data handling and storage.

Despite the commercial benefits of public cloud, for many sectors such as financial, healthcare and government, the large-scale use of public cloud services may remain off the immediate radar due to regulatory, national and industry compliance concerns. As confidence grows in the security and reliability of public cloud computing some regulatory aspects may be relaxed, allowing further use of public cloud services.

Managing the cloud

Capacity and performance planning is an important factor in cloud management. Organisations need to understand how their cloud environment is growing and performing in order to make suitable projections about the amounts of network bandwidth, storage, CPU power, etc. needed. In the 1980s and 1990s IT needs had a sort of linear capacity progression and one could plan three years ahead with a decent degree of accuracy. The rise of the Internet and high data proliferation has shortened the planning window to between a few months and two years in some cases. In particular, unfettered growth of unstructured data is presenting the IT organisation with one of its biggest challenges. A smart cloud design will need to have features to make sure end-users consumers and the IT organisation are not caught out by any nasty capacity or performance surprises.

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