What it means to adopt a Cloud strategy?.
Cloud computing in the areas of Platform as a Service (PaaS), Infrastructure as a Service (IaaS) and Software as a service (SaaS) were the words of 2012. Vendors like SAP, IBM,Microsoft, RedHat, Oracle, VMWare and Citrix all entered this space early on and now we see that these solutions are evolving into second generation products in 2013 (Read more at http://venturebeat.com/2013/01/14/the-second-generation-of-cloud-startups-is-here/#ST0T4K7MFbYxhGlA.99)
Now that cloud computing is making a huge impact in other market areas like big data, social and mobility, to help drive and support new business scenarios, we will see more and more hardware and software vendors embarking this journey around their products and solutions. ( See: Gartner: 10 critical IT trends for the next five years)
Benefits of the cloud offerings is often associated with reducing cost and increasing agility. While this is true, the more strategic role that cloud solutions can play for the customers and the vendors are in achieving operational excellence, product leadership, customer intimacy, and open innovation. Cloud computing is part of a long and powerful trend towards virtualization. Virtualization acts as a stepping stone for cloud which mainly helps to bring down the operation cost down, at the same time facilitate speed and agility in deployment and maintenance in the long run.
Given the above factors, the following are typical areas to consider when thinking of ROI when adopting a cloud strategy:
- Hardware costs – how much will this save in terms of the servers and storage devices.
- Maintenance for the hardware – will there be any savings ?
- Software licenses cost – usually the license post for a cloud solution is priced less than on premise. How much cost can be reduced per seat?
- Maintenance for the software – include both the vendor support and your internal support costs
- Facilities costs – can you lower the power, HVAC, building costs etc.?
- Productivity/efficiency costs– what is the learning curve, are the people who will use the new system more productive? what is the cost involved for training?
- Agility around new opportunities – are you able to respond faster, but cheaper, to opportunities that otherwise would have taken more development time and money?