© 2009 Verizon. All Rights Reserved. PTE13757 06/09

Your Cloud Under Your Control? Enterprise Ready On-Demand Computing

June 6th, 2011

Your Kings-of-the-Cloud:

Drs. Job Stierman RE MoC CGEIT - VerizonDrs. Mike Chung RE - KPMG

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IT leadership must help accelerate business growth while optimizing performance.

The Extended Enterprise A Complex, Global, and Dynamic Business Model A Complex, Global, and Dynamic Business Model

•Challenges for IT Leaders

– Complex networks

– Large number of applications

– Security and compliance

– Remote locations and workforce

– In-house expertise

– Capital investment

– Timely support for Infrastructure growth

RemoteWorkers

Partners

Customers

Retail Locations

BranchOffices

Data Centers

ContactCenters

Headquarters

Distributors

Suppliers

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Business ChallengesInflexible and Cost Prohibitive Infrastructure

Enterprises are faced with a common set of business challenges centered around improving performance of applications and infrastructure while controlling the cost of doing business.

• Common challenges include:• Traditional method: Traditional method:

Plan to peakPlan to peak

• Each department or business Each department or business application was in a silo with application was in a silo with dedicated resourcesdedicated resources

• Demand varies over time Demand varies over time

• Idle servers waste capital, Idle servers waste capital, power and cooling, and power and cooling, and data center spacedata center space

• Traditional method: Need a Traditional method: Need a feature, buy a boxfeature, buy a box

• Cannot scale quickly for Cannot scale quickly for fluctuating business cyclesfluctuating business cycles

• Loss of flexibility Loss of flexibility

• Once locked into dedicated Once locked into dedicated infrastructure, you become infrastructure, you become rapidly overtaken by rapidly overtaken by technology advancementstechnology advancements

• Traditional method: Traditional method: Need redundancy – buy Need redundancy – buy two of everythingtwo of everything

• Capital intensive, Capital intensive, significantly drives up costsignificantly drives up cost

• Complex in nature and Complex in nature and difficult to managedifficult to manage

• Must sacrifice flexibilityMust sacrifice flexibility

• Traditional method: IT as Traditional method: IT as cost center for businesscost center for business

• Difficult to prioritize Difficult to prioritize individual needsindividual needs

• Difficult to perform as Difficult to perform as value centervalue center

• Companies are looking for Companies are looking for departmental charge back to departmental charge back to help cost managementhelp cost management

– Managing the cost of underutilized resources

– Need the ability to deploy capacity on demand

– High availability configurations are complex and costly to manage

– Transparency with information for cost management and chargeback

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Software as a Service

Platform as a Service

Infrastructure as a Service

Ap

pli

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on

sA

pp

lica

tio

ns

Infr

astr

uct

ure

Infr

astr

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ure

Dev

elo

pm

ent

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• Business customers leverage platform to deliver consumer applications, like social networking, video, and music

• Underlying technology is abstracted from IT user

• Business customers leverage platform to deliver consumer applications, like social networking, video, and music

• Underlying technology is abstracted from IT user

• Users access applications from the web, mobile devices, office, and home computers• Purchase features in a flexible manner: per seat, per application, or usage-based

• Users access applications from the web, mobile devices, office, and home computers• Purchase features in a flexible manner: per seat, per application, or usage-based

How Can You Use the Cloud?

CRM/ERP/HR UC Industry Applications

Business Processes

Billing Middleware Database Integration

End User

IT User

• Provide low cost infrastructure as foundation for other services• Multiple entry points to consume resources, software applications, web-based portal

• Provide low cost infrastructure as foundation for other services• Multiple entry points to consume resources, software applications, web-based portal

Server Storage Data Center Network

IT User

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Cloud Drivers Across IndustriesCloud Drivers Across Industries

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Cloud Inhibitors Across IndustriesCloud Inhibitors Across Industries

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Industry Near Term Cloud Opportunity (<2012)Industry Near Term Cloud Opportunity (<2012)

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Utility Based Pricing Cash Flow Friendly Model

Take financial risk in monthly increments by transitioning from a CAPEX model to an OPEX oriented model, matching resources consumed to actual business demand and growth.•Based on Daily Usage, billed

monthly

•Predictable Monthly Rates per Resource

•Proration for Mid-Month Usage

•Usage Reporting and Trending

• Flexible Contract Terms – Pure usage – Commitment Tiers

Resource Usage Metric

Servers Per Device

Software Per CPU / Device

Storage & Backups Per GB

Bandwidth Per Mbps

Firewall / LB Per Device

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Comprehensive Security is mandatory Layered Approach: Design with Security in Mind

Infrastructure Infrastructure SecuritySecurity

• Physical security of data center environment • Rigorous security testing and audits including certification

• Benefits of Virtual Farm approach:– Load Balancer controls application exposure to Internet– Multi-tiered network with Virtual Firewall in between

• Single sign on portal • Audit trail of all change actions• Secure connection to customer provisioned farms • Hardened OS build on private build network• Continuous patch management

ClientClientSecuritySecurity

Optional SecurityOptional Security• Identity and Access Management• Host Intrusion Detection/Host Intrusion Prevention • Log Management• Application Vulnerability Assessment• Network Application Assessment• Professional Security Services including SMP

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CLOUD SERVICES MATURITY LEVELS: AN ENTERPRISE, EITHER CLIENT OR SERVICE PROVIDER IS CHARACTERIZED AS:

Ad Hoc / Initial:

Processes around

cloud services are ad

hoc and disorganised

There is evidence that the enterprise has recognised that cloud-services exists and need to be addressed. Management recognises the need for cloud services planning. Developments and emerging technology with regards to cloud services implementations are ad hoc and isolated. There is a reactive and operationally focused approach to cloud services. Technology directions are driven by the often contradictory product evolution plans of hardware, systems software and applications software vendors. Communication of the potential impact of changes in technology is inconsistent. There are, no standardised processes to deploy cloud-services; instead, there are ad hoc approaches that tend to be applied on an individual or case-by-case basis.

Repeatable but intuitive: Processes around cloud services follow a regular pattern

The need for and importance of cloud services are communicated. Planning is tactical and focused on generating solutions to technical problems, rather than on the use of cloud technology to meet business needs. Evaluation of technological changes is left to different individuals who follow intuitive, but similar, processes. Processes around cloud services, such as maintenance, problem & change management, have developed to the stage where similar procedures are followed by different people undertaking the same task. There is no formal training or communication of standard procedures on how to deploy cloud services, and responsibility is left to the individual. There is a high degree of reliance on the knowledge of individuals and, therefore, errors are likely.

Defined process: Processes around

cloud services are documented and communicated

Management is aware of the importance of cloud services. Development planning and process around the cloud are reasonably sound and aligned with the IT strategic plan. There is a defined, documented and well-communicated technology infrastructure plan, but it is inconsistently applied. The cloud services direction includes an understanding of where the organisation wants to lead or lag in the use of cloud services, based on risks and alignment with the organisation’s strategy. Key vendors are selected based on the understanding of their long-term technology and product development plans, consistent with the organisation’s direction. Procedures around cloud services, such as maintenance, problem & change management, have been standardised and documented, and communicated through training. It is mandated that these processes should be followed; however, it is unlikely that deviations will be detected. The procedures themselves are not sophisticated but are the formalisation of existing practices.

Suggested Cloud Maturity Model (1)Suggested Cloud Maturity Model (1)

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CLOUD SERVICES MATURITY LEVELS: AN ENTERPRISE, EITHER CLIENT OR SERVICE PROVIDER IS CHARACTERIZED AS:

Managed and measurable: Processes around cloud services are monitored and measured

Management ensures the development and maintenance of the cloud services plan. IT staff members have the expertise and skills necessary to develop a cloud services plan. The potential impact of changing and emerging technologies is taken into account. Management can identify deviations from the plan and anticipate problems. The process of developing the cloud services plan is sophisticated and responsive to change. Internal good practices have been introduced into the process. The human resources strategy is aligned with the technology direction, to ensure that IT staff members can manage technology changes. Migration plans for introducing new technologies are defined. Outsourcing and partnering are being leveraged to access necessary expertise and skills. Management has analysed the acceptance of risk regarding the lead or lag use of cloud services in developing new business opportunities or operational efficiencies. Management monitors and measures compliance with procedures and takes action where processes around cloud services appear not to be working effectively. Processes are under constant improvement and provide good practice.

Optimised: Cloud best practices are followed and automated

A research function exists to review emerging and evolving cloud services and benchmark the organisation against industry norms. The direction of the cloud services plan is guided by industry and international standards and developments, rather than driven by technology vendors. The potential business impact of cloud services change is reviewed at senior management levels. There is formal executive approval of new and changed technological directions. The entity has a robust cloud services plan that reflects the business requirements, is responsive and can be modified to reflect changes in the business environment. There is a continuous and enforced process in place to improve the cloud services plan. Processes have been refined to a level of good practice, based on the results of continuous improvement and maturity modelling with other enterprises. Cloud services are used in an integrated way to automate the workflow, providing tools to improve quality and effectiveness, making the enterprise quick to adapt.

Suggested Cloud Maturity Model (2)Suggested Cloud Maturity Model (2)

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Any Questions?Any Questions?Any Questions?Any Questions?