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Is Your Head In The Clouds

By Faisal Hoque Print this article Print

It takes a new way of thinking about IT and a separation of business from buzzwords to determine the real value of utility computing in your enterprise.

Cloud computing is a fitting term for something shrouded in mystery and hard to grasp. Adding to the confusion is the plethora of buzzwords that surround this concept: grid, utility, service-oriented architecture (SOA), service management, software as a service and platform as a service.

It’s easy to get lost in the promise of this technology, but it’s important to keep in mind that this is ultimately a matter of business, not technology. As such, cloud computing’s usefulness must be assessed in the context of the enterprise as a whole.

New ways of thinking are required. Investment decisions and success measurements will not be about individual technologies or projects—or even about the information technology department itself—because the cloud is about the whole organization.

Essentially, cloud computing involves processing and storage that’s done “elsewhere.” It’s physically removed from the user and is typically off-site. The user doesn’t have to think about the hardware: It’s selected and made available by the vendor company that maintains the cloud.

In some cases, the user doesn’t even need to think about specific applications: He or she just specifies the functionality needed. In other situations, a business-side user employs the functionality without a technology department acting as an intermediary. The strategic and tactical guidance typically performed by internal IT groups resides in the cloud.

Amazon, for example, is trying to make the purchase of computing resources as simple as buying a book. It created a “cloud” out of its vast storage and processing capacity and offered it to outsiders. To date, 370,000 developers have signed up. The same company that tends to your book or DVD orders is making its technology available to these companies on a pay-as-you-use-it basis.

Amazon touts its Amazon Elastic Compute Cloud (EC2) as a major shift in the economics of computing: It reduces the time required to obtain and boot new server instances to minutes, allowing quick scaling up or down as requirements change. Users pay only for what they use. Developers have the tools to build failure-resilient applications and isolate themselves from common failure scenarios—although Amazon’s services recently went down for a time, crippling the businesses running on them.

One Amazon customer is Assay Depot, a company that seeks to improve the way drugs are developed. It brings research service providers together on its Web site, where they are accessible to researchers worldwide. The infrastructure of the firm’s site is hosted by EC2.

“This setup makes testing and scaling a breeze,” says Assay Depot CIO Chris Petersen. “We can start a new server at any time. For instance, if we have a code or database change that seems particularly dangerous, we bring up a new instance for staging, deploy the latest code to it and test it to our heart’s content. Since the staging server is an exact copy of the production server, we can be sure our code will run the same in both environments.”

The clincher: Assay Depot runs its business for a fraction of the cost of traditional environments.

This article was originally published on 2008-05-28
Faisal Hoque, Founder, Chairman and CEO, BTM Corporation Faisal Hoque is the Founder, Chairman and CEO of the Business Technology Management Corporation. BTM Corporation innovates new business models, enhances financial performance, and improves operational efficiency at leading global corporations, government agencies, and social businesses by converging business and technology with its unique products and intellectual property (IP). A former senior executive at General Electric (GE) and other multi-nationals, Mr. Hoque is an internationally known, visionary entrepreneur and award winning thought leader. He conceived and developed Business Technology Management (BTM) to direct the social and economic growth of organizations by converging business and technology, helping transform them into "whole-brained enterprises." He is the author of "The Alignment Effect," "Winning the 3-Legged Race," and "Sustained Innovation," among other publications.
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