For years now, enterprises and service providers alike have been leasing data center space from wholesale providers to meet their large-scale IT infrastructure requirements. While this model has worked for organizations with the financial and personnel resources to build out space themselves, the growing demand in the industry is for more flexibility to ramp up space and power on an as-needed basis.
To address this recent demand, providers are starting to offer larger colocation areas — something referred to as a Data Center-as-a-Service approach.
Smart Business learned more from Pete Stevenson, CEO at Latisys, about the difference between Data Center-as-a-Service and the more traditional wholesale leasing models.
What is Data Center-as-a-Service?
Data Center-as-a-Service is an offering that mirrors the features of colocation — providing access to power, cooling and bandwidth within a secure space inside a 24/7 staffed, fully redundant and highly reliable facility — but is designed for customers seeking 250 kilowatts to 2 megawatts of IT load. This size of deployment is typically ideal for the wholesale leasing arrangement, where tenants within what the wholesale providers consider a ‘turnkey’ facility are still responsible for facilitating their own routing infrastructure, racks, cabling, IP connectivity, etc. Data Center-as-a-Service providers deliver all of this under a service contract, leveraging their investments in equipment, technical experts and premier providers to eliminate the need for any customers’ capital expenditures.
Why would an organization choose a Data Center-as-a-Service solution over a traditional leasing model?
The Data Center-as-a-Service model provides the customer with much more flexibility than traditional leasing models. Most leasing arrangements are long-term agreements, ranging from 7- to 10-year-long contracts. As more and more companies are learning about the advantages of server virtualization and cloud computing environments, locking up a significant investment in a lease over several years can prove to be very limiting with regard to taking full advantage of rapidly advancing technologies that offer improved efficiency and reliability.
Providers of the Data Center-as-a-Service business model are often in a better position to offer more reasonable leasing terms, as well as additional IT infrastructure management solutions. From managed hosting to managed services, including storage, backup, security services, monitoring, load balancing and disaster recovery services, the provider’s ability to align different services and solutions according to the customers’ requirements translates into maximum agility for the customer. They are able to take full advantage of the latest infrastructure technologies.
What are some of the key advantages with a Data Center-as-a-Service model?
- OPEX versus CAPEX: Rather than investing large capital expenditures in building your own infrastructure or turning up and staffing a leased space, you can utilize the technological innovations, dedicated service professionals and efficiencies of scale that a Data Center-as-a-Service provider delivers. You get space, power, bandwidth, cooling, security, 24/7 on-site staffing and more all under a single service contract and monthly service fee.
- Service Level Agreement: Leveraging a provider’s Service Level Agreement (SLA) ensures that your IT infrastructure availability and performance sync with your firm’s business objectives. SLAs help guarantee performance delivery by including economic penalties that hold the provider financially accountable.
- Network redundancy: In a leased environment, you’d be responsible for contracting your own network providers, which usually makes you reliant on a single Internet carrier and susceptible to embarrassing and expensive outages. Most Data Center-as-a-Service providers are able to offer blended bandwidth — multi-gigabit connections through diverse IP providers to ensure reliable connectivity through enhanced redundancy.
- World-class security: Security processes are essential for the integrity of your mission-critical infrastructure. For the protection of all customers within the facilities, providers typically feature multi-layered security systems, digital video surveillance, network monitors and a 24/7 NOC team.
- Managed services: Have a single point of contact for all monitoring, reporting, maintenance, performance and availability of the IT infrastructure. And while there may be different specifics per each unique service in place, all solutions are provided under the SLA to ensure the highest levels of reliability and performance.
- Ultimate scalability: Gain a much more flexible relationship with the provider, as you’re in a place that can scale along with you. Take as much space, power, bandwidth and cooling as you need today — and when you need more, add only as much as you need. Data Center-as-a-Service providers truly become partners, as they are able to grow with you, at the speed of your growing business.
What traits should an organization look for when choosing a Data Center-as-a-Service provider?
All Data Center-as-a-Service providers have different capabilities, so it’s important you find one that not only meets all your current requirements, but that’s building for the future. Make sure the provider you choose is financially stable, has top-notch physical security, clearly defined SLAs, and sufficient growth capacity to meet your data challenges of today as well as the ever-evolving data challenges of the future. That’s when you can be sure you’re in a safe place to grow.
Pete Stevenson is the CEO of Latisys. Reach him at email@example.com.
Anyone who is familiar with Jellyvision Lab’s work knows that the company has been an innovator in human-machine interface since 1995, plugging out such interactive hits as “You Don’t Know Jack” and “Who Wants to be a Millionaire.”
But there is another way that Jellyvision has been an innovator, largely thanks to company president Amanda Lannert’s efforts: its culture.
Lannert was named one of 2010 Smart Leader honorees by Smart Business and U.S. Bank. We asked her how she overcomes challenges, innovates and gives back to the community.
Give us an example of a business challenge you and/or your organization faced, as well as how you overcame it.
In 2000, a few months after I joined the company as director of marketing, the company was headed toward a steep cliff. The company’s core business was in CD-ROM games and despite a very successful run with interactive hits like You Don’t Know Jack” and “Who Wants to be a Millionaire,” the CD-ROM market itself was dying.
Even though I was the most junior executive in the company, I prevailed on the rest of the team to be clear-eyed about the gravity of the situation and begin the process of laying off employees in order to keep the company alive — employees including myself.
As painful as this was, it allowed Harry Gottlieb, the CEO, to raise a little money and reconstitute the company, taking it in a new direction. In less than a year, I was rehired to the post of president. Nine years later, the company is thriving.
In what ways are you an innovative leader, and how does your organization employ innovation to be on the leading edge?
Jellyvision has always been fortunate to be staffed with extraordinarily creative, talented and decent people who’ve had the opportunity to work on interesting projects. But I’ve tried to take those ingredients and, like adding pectin to pie, bound them with daily delight. Institutionalized delight. It is fun to work at Jellyvision.
Of course, the work can be hard and frustrating at times, but even then, employees bask in the humor and fellowship of each other’s company. This inclination flows from the top, because I practice it and live it every single day. I make a point of praising in public.
When we lose our electricity every summer (thank you ComEd), I gather the entire company in a giant game of ‘Murder.’ No birthday passes without an e-mail to the company letting everyone know who to celebrate that day. On my birthday every year, I insist that all the men in the company ‘honor’ me by growing out their facial hair the month before and come to work that day in a mustache.
And I try to make sure Jellyvision’s clients ‘feel the love.’ My goal is for everyone at Jellyvision to understand that being fun and easy to work with, being empathic and grateful, is a fundamental reason why our clients keep coming back for more.
How do you make a significant impact on the community and regional economy?
For the legions of Chicago improv artists and comedians who are waiting tables and filling temp jobs to make ends meet, Jellyvision provides hope: There is a place on the shore of Lake Michigan where they can ply their talents, actually get a real salary, medical insurance and a 401(k) plan and, as a bonus, be treated with endless respect. Do you have any idea how much creative ability is given birth in this city? Go to Los Angeles, more than half the people there with real talent come from Chicago. Jellyvision contributes to the second city, by hiring some of our best and brightest and keeping them away from ‘the great sucking sounds’ of the East and West Coasts. Moreover, I have served on the board of directors of the Chicago Improv Festival and was a mentor to startups in Chicago’s accelerator program, Excelerate.
How to reach: The Jellyvision Lab, www.jellyvision.com
If someone told you that you could drop your operating costs by 40 percent, would you listen? If that same person said you could you save between $70 and $150 per user per year in energy savings alone if you tried something new, would you try it?
A lot of companies are listening, and those same businesses are trying something new — cloud computing and software as a service (SaaS) — and reaping the many benefits, which start with the aforementioned cost savings.
“From a cost perspective, it’s low-risk,” says Adam Caplan, founder and CEO of Chicago-based Model Metrics, a cloud-computing services firm. “You don’t have to pay monstrous upfront payments. It’s success-base as you go — you pay per user for cloud applications.”
With a model like that, it’s easy to save money, which is one of the biggest appeals of cloud technologies.
“There’s a tremendous amount of money to be saved because if you look at IT budgets, nearly 80 percent of that budget, in many cases, is spent just to keep the lights on, which means the other 20 percent is the only money that’s actually able to be used to implement new technologies into the model,” says Jeff McNaught, chief marketing officer at Wyse Technology.
McNaught’s company builds a device that replaces the PC and connects you to the cloud. The device doesn’t make a lot of noise, but more importantly, it doesn’t cost a lot of money.
“When you look at cloud computing, operating expenses can drop by about 40 percent a year, and that’s real money,” he says. “These devices use one-tenth of the energy of the PCs. Now you’re really talking about saving real money.”
How cloud works
So the idea of saving that much money has caught your attention, and now you may be asking, “What exactly is this whole cloud computing thing anyway?”
Caplan says the biggest idea to grasp is that cloud technology allows you to approach business differently.
“The biggest change is for the first time, businesses can roll out applications and know that they’ll be extremely successful with these applications,” he says. “If you look in the past, the chance of success was so low. Companies spent a lot of money, they spent a lot of time, and now they’re going to be successful.”
The reason for that is the way this technology changes what you’re currently doing.
Dave Hitz is the co-founder and executive vice president of NetApp, a company that sells enormous amounts of storage to people that need it. For example, Yahoo stores all of its e-mail accounts on his equipment, and the special effects for “Avatar” were stored on his equipment, as well. He sees two different definitions of cloud computing.
“Definition No. 1 of cloud computing is you no longer buy a computer,” Hitz says. “You access computing service over the Internet to somebody else’s data centers, and they spend the capital and they hire the people to build them and they do everything, and all you do is pay a monthly bill and access the service over the Internet. Style No. 2 of cloud computing is a completely technical definition (that) has to do with if you’re going to build a data center, what does the architecture look like? And if the architecture has a lot of shared infrastructure, then people tend to call that kind of environment a cloud computing environment.”
His first definition is another benefit to cloud because it eliminates many IT headaches because, being honest, how often do you have an overly positive IT experience?
“I imagine people would say they’re experience with IT has been less than optimum,” says John Dillon, CEO of Engine Yard Inc., a company that delivers an environment for software developers to write programs that run inside the cloud. “The reason is you spend so much money building all this infrastructure, that going the last mile, which is where you write the application that interfaces with the human, the user, doesn’t get the attention, doesn’t get the money and doesn’t get the investment.”
The idea of the cloud is essentially that you plug into the wall, and you get a whole data center.
“It’s IT as a service, just as you get electricity or water,” Dillon says. “In business, you, in most cases, don’t have your own power plant, you didn’t dig your own well, you didn’t build your own building, you don’t have your own fire department or police department. So why on earth do we basically give power to a group to build something that has been built before in-house, and then hope it works?”
Dillon also points out that in the United States, capital expenditures are a huge expense. In fact, about 50 percent of capital expenditures in America are information technology.
“Unbelievable,” Dillon says. “How many people are getting the ROI on this? What’s happening with the cloud is some big companies are saying, ‘Look, I’ll build the data center.’ It’s changing who buys, why it’s bought, and it changes the capacity and the economic decision-making process around IT.”
When you look at how much money most organizations spend on their IT systems, these cost savings are a big driver, but another benefit is cloud makes your IT department more effective in the company.
“The real power that CIOs are finding is that they go from worrying about managing data centers and managing servers and the non-strategic things their teams are focused on, and they love this stuff because after this, they’re focused on strategic initiatives that drive revenue growth,” Caplan says. “They’re actually contributing in a real way to revenue growth and cost reductions and not just focusing on the servers are out.”
A lot of times, your CIO may wonder if this means you’ll need to reduce the IT department staff size, but Caplan says that’s rarely the case.
“Usually, you have the old line, ‘I’m very scared of change,’” Caplan says. “And all my people in IT, their job is to make sure the servers don’t go down, to make sure the e-mail works. Their job is to reset passwords and worry about the lights. There’s sometimes fears if you don’t have to worry about that stuff anymore — that stuff just works, and you don’t have to worry about it — what will happen to my team? Will my team shrink? Almost every time, the answer is no. The team just morphs into a far more strategic team. They can get more active in the business on cool applications that drive the business forward.”
Another benefit is that now have everything that is on your PC in one location that can be accessed from anywhere — not just from the PC itself — and that comes with benefits in and of itself.
“When you take your software and your applications and your data and you move it to the cloud, something’s happened,” McNaught says. “First off, the cloud is the data center of your company and you can always get to it. You’re connected to the Internet, so you can get there from home, from the conference center, from the airport. And guess what? Because it’s not on a PC with a hard drive failing and memory getting filled up, it’s protected. It’s backed up. It’s secure. So the cloud provides this real opportunity to take the things that make up our work life, and within five years our home life, as well, and move them to this one place where we can always find our stuff.”
The evolution of cloud
Experts agree that cloud computing is pretty amazing, but it’s not a new concept.
“Looking at best practices, this stuff isn’t new anymore,” Caplan says. “We’re in year eight now. Salesforce has been around since 1999. Amazon Web Services, Google — whether you’re using their technology, none of them are brand new, so there are a lot of best practices to learn from.”
So if this isn’t new, it’s interesting to look at how cloud has developed and how it’s changing business. Dillon is amazed by cloud computing, and it’s hard to disagree with him.
“This cloud thing is the biggest thing that’s happened in technology since the IBM computer, and that’s pretty big, and at least as big as the Internet in terms of economic disruption, because it changes how and where we do our computing,” Dillon says.
He says to go back a few years and remember how every small and midsized business had a room with computers in it and maybe a server or two.
“As businesspeople, you probably didn’t understand what they were for, but you knew they were important and you wrote checks,” he says. “It was hard to be good at that, because you had a business to run, and presumably you were an expert at that business, and you used technology to be good at that business or best at that business, so it was a necessary evil.”
Over the last 10 to 15 years, a variety of things happened that became game changers. First, we got the Internet.
“Everybody is connected — not just a few people are connected — and we’re connected not just inside our companies but outside our companies,” Dillon says.
Second, access became ubiquitous with the advent of cell phones, BlackBerrys, iPhones and laptops.
Then access got cheap — almost free. It doesn’t cost you anything to go to Google and look up any information that you want.
“You think about that perfect storm that happened — we’re having an explosion,” Dillon says.
McNaught would add another element to that perfect storm — the PC itself. He asks how many people really love their PC with its bulk, weight and the fact that if you drop it, it’s useless. He says the data indicates that PC market share, which is about 94 percent now, will drop over the next decade to about 10 percent.
“It’s not because less PCs will be sold — maybe a few less, but it will lose its role as the core device we use to access our stuff,” he says “You’ll see this huge proliferation has already started with tablets and mobile devices and mobile phones and the mobile Internet exploding now. The question becomes, how do I access my stuff? How do I access it securely? And how do I access it at the lowest cost?”
These are questions that most people would agree are incredibly important. In fact, these questions are reasons why cloud hasn’t been successful in the past.
“This had been tried before and it’s failed, because there were two things we couldn’t get right as an industry,” McNaught says. “Early on, we couldn’t make all the software that was important to your business work reliably. We walked into the hospital and the hospital says, ‘We have 400 applications, we can only make 350 work on the cloud. Where are the other 50 we need to execute?’”
The other factor was user experience.
“If you get, from the cloud, an experience that is the slightest bit less robust than the experience you get at home or the office today, what are you going to do?” McNaught says. “You’re going to go beat the living daylights out of the IT guy who suggested the cloud.”
But now, the technologies have changed, and these two pieces have largely been addressed. On top of that, security is stronger than with a PC, and that’s why companies large and small are now using the cloud.
“There’s an adage in the IT industry that when you introduce a technology that reduces costs, you’re giving up benefits, and if you introduce a technology that gives you big benefits, it costs you a fortune,” McNaught says. “The thing about cloud computing is that it fires on both cylinders — it reduces costs dramatically and delivers incremental benefits that you don’t get with the current model.”
How cloud can affect you
You may read this and think how great it all sounds and see how important cloud is to the future of business. But if you’re not ready to jump on the bandwagon, Caplan would caution you to rethink your position.
“With other companies rapidly implementing these, if you’re not doing it, it’s turning from a competitive advantage to, for those laggards to moving into the cloud, definitely a competitive disadvantage,” he says. “Just to keep up is critical.”
You may wonder why this particular technology is so critical to business. Hitz says this is similar to other major technology game-changers in the past.
“I’ve had the opportunity to ask a lot of CIOs, ‘How is cloud computing affecting your business? How much cloud computing are you using?’” he says. “The most common answer I get is, ‘It doesn’t affect our business at all yet, and we’re not using it at all yet.’ I will tell you that almost all those CIOs are wrong. They’re already using it but not thinking right.”
He say that CIOs need to think differently and compares it to the early days of the transition from the mainframe to the PC. In those days, if you asked a CIO if they had a PC strategy, many said, “Oh no, that’s not part of what we’re doing,” but half the employees had PCs.
“When data started leaking out the door because somebody lost their PC, who do you think the CEO went to beat up?” Hitz says. “The CIO, and the CIO said, ‘Well, PCs aren’t really IT.’ Those are the CIOs that are gone. I predict the exact same thing is going to happen to the CIOs who think that cloud computing isn’t happening in their business. … There’s an enormous amount of work that CIOs need to start thinking about — how do I get my arms around all the cloud contracts that are being found in little places scattered around.
“It’s affecting a lot more than people are realizing, because they’re not defining it broadly enough. If they look at that broader definition, the stuff they’re already sort of doing or in denial about, that stuff is a pretty good road map to where the future is headed, just more.”
Not only is it affecting how your business will run, but it’s also going to change how new companies enter the market. Brian Jacobs is founder and general partner of Emergence Capital Partners, a Silicon Valley-based venture capital firm.
“Silicon Valley is very much a startup culture — there’s always something starting up here, and it’s important to note that cloud computing also changes the economics of a startup,” Jacobs says. “A startup today doesn’t need as much capital to get going because of cloud computing. A developer, who could be an independent contractor, an engineer who’s working at a day job and at night has a new product he wants to develop — he can log in to a platform as a service like Engine Yard, and they can start developing their product without a single dollar of investment. They can work for free developing the product until they’re at the point they can introduce it to the market.”
Aside from all the ways that cloud computing will change business, it’s also changing how employees approach their jobs. While people can work from home in their pajamas, it’s often difficult, and in many cases, employees don’t have access to everything that they could if they were on their PC actually in the office.
“Cloud computing lets you access your work environment, and you’re on your couch — maybe in your pajamas — and you’re doing real e-mail and doing real work, and yeah, maybe your boss is getting a little more work out of you, but you’re doing it, quite honestly, voluntarily because you get to work in your environment, you’re not in the office, you’re not sitting in front of the computer in the office and you probably have better TV shows on,” McNaught says. “The technology that cloud computing provides is about saving cost and delivering additional benefits.”
To give you a real example, Hilton Hotels decided to close their physical reservation centers and send all of their reservationists home with these devices that connected them securely to the Hilton system.
“What Hilton found was they could close all those buildings and save those costs of real estate, and they saved all the energy costs of running the PCs in the buildings, and they found the employees were happier, because they were working from home — maybe in their pajamas but nobody could tell. They were working over secure devices, so Hilton didn’t lose any data, and they were working over a device that didn’t have the complexity of the PC, so they weren’t calling the IT staff out to their homes to fix this,” McNaught says. “Cloud computing allowed Hilton to save money in so many ways that satisfaction increased, and they found that people working at home would take a lower pay. They saved on all sorts of fronts. Cloud computing has a transformative effect on all kinds of business.”
On top of that, Caplan says that cloud has the ability to raise employee morale even if you’re not sending them home to work.
“Put aside the adoption and cost benefits, and I think what you’ll find is your team just loves these applications because they’re used to dealing with consumer-based applications,” Caplan says. “They all know how to use Google, Facebook, Amazon. You’re basically equipping them with applications that are just as easy to use as those, and I think you get a ton of employee loyalty and you make your employees so much more efficient that from a recruiting perspective and a retention perspective and from efficiency, there’s just huge value.”
CHICAGO, April 26, 2011 /PRNewswire/ -- Low-cost summer camp requests have almost doubled since 2008, according to a new work-life report released today by ComPsych. Overall summer care requests have increased by 7 percent as more working parents seek help from ComPsych Work-Life services. ComPsych Corporation is the world's largest provider of employee assistance programs and is the pioneer and worldwide leader of fully integrated EAP, behavioral health, wellness, work-life, HR and FMLA administration services under the GuidanceResources brand.
"Working parents are increasingly looking for help in locating free or reduced-cost options for summer care and activities," said Dr. Richard A. Chaifetz, Chairman and CEO of ComPsych. "This is a major change from pre-recession trends, which included more-expensive options such as sports or performing arts-themed camps.
"Employers who support their workforce with ComPsych programs – including a staff of experienced work-life specialists who can research low-cost summer alternatives – will see better productivity, less distraction and less stress in their employees."
Key findings of the report:
- As a percentage of overall work-life calls, summer care requests have increased by 7 percent in 2011, with parents seeking less-expensive alternatives for their summer needs.
- Camp requests overall have increased to 42 percent, surpassing Infant and Toddler Care.
- Nanny Service requests have dropped from 9 percent to 6 percent, as in-home care has become increasingly cost prohibitive for many families.
- Requests for relatively expensive summer camps, such as sports and performing arts-themed camps, are less than half of early 2008 levels, before the recession.
ComPsych® Corporation is the world's largest provider of employee assistance programs (EAP) and is the pioneer and worldwide leader of fully integrated EAP, behavioral health, wellness, work-life, HR and FMLA administration services under the GuidanceResources® brand. ComPsych provides services to more than 13,000 organizations covering more than 35 million individuals throughout the U.S. and over 100 countries. By creating "Build-to-Suit" programs, ComPsych helps employers attract and retain employees, increase employee productivity and improve overall health and wellbeing. Follow us on Twitter: http://twitter.com/ComPsych.
SOURCE ComPsych Corporation
Cloud computing is the talk of the town. It seems like everyone is doing it, and anyone who isn’t is thinking about it. But is the cloud the answer for everything? How can companies leverage the cloud in ways that are smart for their business? What should companies be thinking about as they transition?
Smart Business spoke with Mike Landman, CEO of Ripple IT to get some insight.
The cloud seems to be everywhere. What should businesses be thinking about? Is the cloud right for everyone?
The short answer is: Yes, it’s right for everyone. The long answer is: Maybe not right now, and not for everything.
First, everyone has their own definition of cloud computing. But I’ll use the shorthand that cloud computing is pooled, distributed, mostly virtualized computing resources. The cloud might be utilized for applications like Google Apps or hosted Exchange, or it might be used for all of a company’s servers and infrastructure.
Cloud computing will be for everyone because there is really no turning back. Over the next five years, nearly all server computing will be pooled, distributed and virtualized. This is good. Cloud computing is cheaper, more reliable and easier to manage.
The issues are more about the transition, how to get there and what will and won’t work right now. A five-person company has it pretty easy. The founder can just decide they don’t want any servers and put everyone on Google Apps on Sunday afternoon. A larger company has lots of legacy computing and applications; and disruption, training and workflow become larger considerations. They don’t have it so easy.
So why would a company want to hold off on moving to the cloud?
It’s unlikely that anyone would hold off entirely on cloud computing. Most companies are using at least one tool that is cloud-based right now, but the transition may be slower for certain types of companies.
We work with a lot of ad agencies, for example. They have a great use case for moving e-mail to the cloud. We have at this point transitioned almost every client to cloud-based messaging. But transitioning all of their server infrastructure is much more difficult and, in many cases, not yet possible. An ad agency is filled with people that routinely work on 500MB files. There’s just no reasonably priced bandwidth option that gives an agency a satisfactory experience working on such big files across the Internet. They still need a LAN. That’s going to apply to most companies with lots of big files. But those companies can still take advantage of many cloud benefits by making sure their IT people are leveraging virtualization for the resources that need to stay in-house. Virtualization allows for many cloud benefits, even on a LAN.
What’s virtualization and what is its role?
Virtualization is basically where you take a server — something that has traditionally been dedicated to a single OS — and allow it to run multiple ‘instances’ of servers. It is traditionally thought of as a way to consolidate resources. Instead of running three servers, each on its own hardware, perhaps you can run three servers on one piece of server hardware.
To me, that’s pretty cool, but it’s not the most important thing about virtualization. The best part is that in order to run multiple servers, virtualization has to ‘fool’ the OS into thinking it’s running on one type of hardware, no matter what the hardware actually is. As a result, the underlying hardware isn’t particularly important. Since the OS thinks all the hardware is the same, the server instances can be moved around with relative ease. Like when there is a hardware failure, a migration, or when you are moving from your LAN to a public cloud. The reason that’s cool is that it means less downtime, faster recovery from failures, faster (cheaper) migrations, and a much easier time moving to public (or semi-public) cloud resources.
That’s why, even at our very smallest clients, we leverage virtualization. A virtualized environment opens up options and makes most everything easier for a move to the cloud, whether that cloud is public, private or something in between.
That’s terminology I have been hearing a lot. Private versus public clouds. What’s the difference?
Public clouds are large, distributed pools of resources that everyone can use. Amazon, Rackspace, and Google are the biggest public clouds. Private clouds still use pooled, distributed and virtualized resources like public clouds, but they are under the control of the company using them. Most large companies have data centers they operate themselves. They are increasingly becoming private clouds.
The importance is blurring though. There are a number of ways to use public clouds privately. Much like using VPN technology to privately access computers over the Internet, it is possible to use public cloud resources privately with restricted access and encryption. At Ripple, for example, we run our cloud technology with total separation between clients, creating completely separate networks and servers while still leveraging a pool of technology to increase redundancy and uptime, and provide a cost-effective way for our clients to leverage the cloud.
So what should companies do as they transition to the cloud?
My counsel would be to work it through with a trusted IT resource, someone that can help you think things through from a business perspective, not just an IT perspective. At the same time, don’t just walk in and demand that your IT folks ‘put your business in the cloud.’ There is a lot to consider from both sides (strategy and infrastructure) and moving to cloud infrastructure, while inevitable, needs to be well planned, and with the entire business in mind.
Mike Landman is the founder and CEO of Ripple IT, an IT company that makes IT run smoothly for companies with less than 100 employees.
Whether you’re prepared for it or not, Apple’s iPad and the myriad of new tablet computers coming to market will change the way you do business. Not because there is a shiny new gadget available, but because that shiny new gadget is raising your customers’ expectations by a degree far greater than smartphones like the iPhone, Blackberry and Droid already have.
Regardless of the business you’re in – B2B, consumer direct or retail – the customer experience you provide is critical for long-term sustainability and growth. This is especially true for commodities that can be purchased at multiple retailers, online or direct from the manufacturer.
The impact of mobile on the enterprise, however, is being felt far beyond the point of sale. For example, at Eli Lilly and Co., advanced mobile devices and applications offer its pharmaceutical sales force the capability to be highly productive while they are presenting to physicians, as well as during the significant downtime waiting to see them.
For Lilly, mobile devices with longer battery life like the iPad that are always on and provide instant, secure access to any and all existing resources a physician may want to review about a drug are a must. Compared to the antiquated process of combing through hard copy brochures that may or may not have the very latest information or waiting for a laptop computer to start-up and open applications, this is a tremendous enhancement to the customer experience.
In deal-flow environments such as the one at Simon Property Group Inc., the sales force manages tens of thousands of active leases which have volumes of paperwork and space plans associated with them. Traditionally, the Simon sales force has had to travel with the associated paperwork or store it on discs, neither of which is easy to access quickly and seamlessly. Mobile devices like the iPad have helped Simon bring the largely paper-based leasing side of their business into a streamlined digital space that is much more customer friendly.
The important distinction between the way you may have done business in the past and the way you will have to do business in the future is the consumers’ expectation of access to what they want to see, how they want to see it and when they want to see it. Offering customers a technology-limited experience will be met with increasing frustration or abandonment as the tablet and smarter smartphones become ubiquitous.
For most companies, accessing e-mail via mobile devices is now common. This is great and it represents a big leap forward for many organizations. The new standard, however, is for your work force to be able to take everything they do in the office and do it whenever and wherever they need to, without disruption and without having to fundamentally alter the way they do business.
This means having secure access to all documents, software and other applications – multiple reservoirs of corporate information – and being able to interact with them in familiar environments that have the same interfaces as the office.
Though they are more than just incremental upgrades, mobile devices are still not replacing primary business computers in most workplaces. Today’s mobile devices are highly integrated into the work flow and they are excellent tools for displaying and communicating. However, mobile devices are not yet particularly conducive to content creation. Yes, portable keyboards and docks make mobile devices more like full capability desktop environments. But they are not the first choice when one needs to create a business plan or design a website.
The impact of mobile on the enterprise largely results in acknowledging that your customers (and your employees) expect more from you than they did before smartphones and tablets made their debut. Allowing customer expectations to drive the way you engage and interact with them should help you assess how to implement mobile throughout your business and match the right tools with the right people for deeper connections and a better overall brand experience.
James L. Jay is president and CEO of TechPoint, Indiana’s technology industry and entrepreneurship growth initiative. Jay also serves as president and CEO of TechPoint Ventures, which has invested more than $16 million in early-stage capital in twelve Indiana-based technology companies through HALO Capital Group since 2009. An Indianapolis native, Jay has a successful track record as an entrepreneur, business leader and public servant.
Cloud computing can help businesses harness the portability and convenience of Web-based IT services, and if your company hasn’t started investigating this new technology, now is a good time to start.
Cloud computing provides businesses with ease of maintenance, scalability and cost reduction, says Sassan Hejazi, director of the Technology Solutions group at Kreischer Miller, located in Horsham, Pa. Specifically for accounting and financial departments, offsite management of these systems can be particularly valuable from a security and updating standpoint.
Meanwhile, more businesses are looking to the cloud for services instead of purchasing software or overseeing systems in-house that can instead be managed off-site by specialists. Rather than dealing with the limitations of traditional in-house software, companies can simply turn to the cloud and access the programs they need from anywhere.
“Like a utility, when you plug an appliance into an outlet, you get power,” says Hejazi. “You don’t know where that power comes from or who manages the production of that power; all you know is that the power is there when you need it. The IT world is evolving into a utility-based commodity that is very sophisticated and being delivered by specialists. We are now increasingly accessing the technology via ‘the cloud.’”
Smart Business spoke with Hejazi about how businesses can use cloud computing in finance/accounting and other disciplines to streamline their IT portfolios.
What is cloud computing, and how can it work for businesses?
Cloud computing refers to using Web-based applications and services provided by offsite providers. A simple example is e-mail such as Gmail or Hotmail. You can access these services from anywhere with an Internet connection, and you never have to worry about upgrading the program or running out of storage.
Today, most software and hardware providers also offer a ‘cloud strategy,’ so businesses can shift systems they currently manage in house to the cloud and save time, money and resources.
Essentially, cloud computing is the next phase of the Internet evolution. Rather than the Internet serving as a tool for communication, it also can house the systems and services you use to conduct business so you can access these applications anywhere.
What advantages does cloud computing bring to financial and accounting departments?
When finance and accounting departments manage their systems internally, they are responsible for upgrading these systems regularly and keeping up with software changes so they can run them efficiently. The resources required to keep these systems operating at peak performance can be draining, and there’s no reason to expend resources this way now that there are off-site, Internet-based options.
A growing number of applications from leading companies offer cloud-based versions of their accounting and financial systems, which allow businesses to leverage capacity without having to invest in internal resources for basic system maintenance. Cloud-based systems give companies economies of scale because the provider serves many different companies. As a result, resources are highly productive, trained and specialized, giving companies better ROI than if they operated their own system in-house. Essentially, cloud computing allows companies to shift from an internal to an external service provider.
Another advantage is that cloud-based systems are scalable. Companies can easily add more users to increase capabilities, or decrease users to scale back. Also, cloud computing allows companies with multiple locations to access information. Employees can work from home offices or on the road and use the system, as long as there is an Internet connection.
Is cloud computing secure?
There is always some level of risk involved because if a company loses its Internet connection, it cannot access its cloud-based systems. However, this is becoming less of an issue with the newer wireless devices. With a cloud-based system, you also have the ability to access information from anywhere should internal issues such as a system crash occur.
Regarding security, the providers of these offsite systems must earn a SAS 70 certification, which involves rigorous security audits. Generally, they have better backups and disaster recovery than most companies that manage systems internally.
Rest assured, cloud computing has evolved significantly in recent years to become a strong option for companies of all sizes. Of course, to minimize risk, management teams should conduct a thorough study of alternatives and create a cloud computing roadmap.
What should a company consider when evaluating which IT services can be shifted ‘to the cloud’?
First, take an inventory of all hardware and software systems — your portfolio of IT assets. Divide that portfolio into distinct groups, for example, by department and by function, and analyze each section.
How old is the technology? How well supported are the systems? How could operations be improved? Tie this into the bigger picture of business objectives: How does existing software/hardware support your goals for the future? This exercise will help you focus on cloud computing as a business value proposition. As you do this analysis, consider the cost of purchasing systems. It’s not just what you pay today for software/hardware. Figure the total cost of ownership, including periodic upgrades and maintenance.
This is where cloud computing offers a real economic advantage. For scalability, ease of maintenance and lower cost of ownership, cloud computing offers competitive systems that give companies increased flexibility and the ability to access information from anywhere.
Sassan Hejazi is director of the Technology Solutions group at Kreischer Miller, Horsham, Pa. Reach him at (215) 441-4600 or firstname.lastname@example.org.
IPv6 is the “new” way to connect to the Internet. For years we’ve been using version 4 of the Internet Protocol, but have since run out of IP addresses, which are your business computers’ unique address on the Internet.
IPv6 replaces IPv4 and provides a much larger pool of IP addresses.
Smart Business spoke with Bill Mathews at Hurricane Labs to learn more about what the transition will mean for your business.
Why should businesses be concerned with IPv6 now?
I know what you’re saying: That’s years away, why worry about it now? I know that up until about a year ago that was my reaction. I recall all too well sitting in boardrooms in the early century talking about the ‘big migration’ to IPv6 and working with a particularly forward-thinking company on an implementation plan. It was then, of course, we realized maybe they were too forward-thinking, as many vendors hadn’t worked out their support plans just yet.
Fast-forward a decade or so later and a lot of that is still true. Vendor support is spotty and many Internet service providers are saying, ‘IPv6, sure we have that in beta.’ Unfortunately though, this time we’re really running out of IP addresses. It’s important that businesses at least recognize the need to move on to this exciting new realm.
What makes IPv6 a must for businesses?
Strictly speaking from an infrastructure perspective, the IPv6 transition will likely dominate planning meetings and budget forecasts for the next couple of years. Owners should start their strategic thinking now. How will you do a proof of concept? How will you lab this new way of connecting up? What is it going to cost? What are the benefits/drawbacks? What is the impact to the bottom line? Of course these are questions you should ask of any project, but they are particularly important to IPv6 because, for starters, it impacts the entire way you connect to the world. From desktops to desk phones, mobiles and laptops, it affects everything your business touches on a daily basis. I say all that to stress that it’s a pretty big project with far-reaching consequences.
Of course, my standard, stolen disclaimer applies: Don’t panic! There are quite a few resources out there to help you figure it out.
Where can businesses learn more about IPv6?
My company publishes a newsletter (I know what you’re thinking, but it’s not a big advertisement); it’s a way for our engineers to learn more about some emerging technologies and then share it with our customer base and whoever is interested. This month it is dedicated entirely to IPv6. There’s even a ‘cheat sheet’ included that links IPv4 concepts to their IPv6 counterparts to help clear up some confusion.
There are also the wonderful people at Hurricane Electric, no relation, that provide wonderful connectivity to the IPv6 world and even a free certification program. And there are the SixXS guys, who provide tunnel broker services and links to many other resources. So all is not lost; there are a lot of people providing a lot of free resources to guide you along the way.
This brings me to IPv6 World Day on June 8, 2011. It’s a nice little event where companies will show off their IPv6 readiness and have at least their websites presented to the world. We plan to have our network serving both IPv4 and IPv6 versions of our services by then. Won’t you join us?
Bill Mathews is Lead Geek at Hurricane Labs. Reach him at email@example.com.
With the vast array of telecommunications choices and unproven technologies available to businesses, how can they determine which solutions will work to meet their unique operational needs and be the most cost-effective?
“The variety of options available to large companies only adds to the complexity. There are too many competing carriers and technologies,” says Shane Heise, president of Simplify Inc., a firm that helps large multi-location corporations simplify and optimize their communications lifecycle management. “It makes for a world where companies are forced into being reactionary and devoting too many resources to deal with the chaos. This is the opposite of any best-practices approach; but it’s the norm that the industry creates.”
Smart Business spoke with Heise about how to make the right choices that fit your telecommunications needs.
What telecommunications challenges are companies facing right now?
There is a lot of uncertainty in the marketplace right now when it comes to telecommunications. Much of that is due to consolidation in the industry. Additionally, the traditional way of buying telecommunications (local, long distance and data products) has changed because of different technologies available today, some to which people have never before had access.
Most companies today hear buzzwords like VoIP and SIP, but they don’t have anybody on staff with the expertise to even know if those are the best strategies for them. Are they going to save you money long-term? What is the return on investment? Could going to one of these new technologies increase productivity?
Can you really rely on your carrier for these answers? They aren’t going to give you an honest appraisal of their products compared to those of their competitors. The key is opening your mind and saying, ‘I do have those challenges and I know there are a lot of technologies out there, but I don’t know how to uncover what’s best for me.’
How are companies dealing with these challenges?
The traditional telecommunications provider’s tactic is to lock you up in a long-term contract, or try to consolidate all your spend with them as a single provider. They tell you that the more you spend, the better your price points.
However, that’s not necessarily true. You don’t have to give everything to one carrier to get the best price. You don’t have to sign high-commitment, long-term contracts with a single provider. You can consolidate everything into a handful of companies and still get the best solution at the best price, while still doing what is right for your business instead of just doing things the way they’ve always been done.
How can this be done?
Instead of working with an account representative that proposes the same old contract renewal with a few minor changes, consider using a dashboard that identifies trends and assesses your current situation. Then take action to improve technology, reduce cost, etc. You can proactively identify, assess and take action, or reactively work within the constraints of a traditional contract renewal. Which would you rather do? We recommend using a strategic solution process that puts together short- and long-term technical, cost-effective solutions.
How does an executive team ensure that they are optimized?
Great question. You need a collaborative process that leads to a strategic solution. The telcos are not invested in your business. They aren’t meeting as a team and brainstorming new solutions for you. They are proposing options that benefit them but not necessarily you. They may cooperate, but they can’t collaborate. Instead of being in reactionary mode, renegotiating and renewing each contract, companies can ensure optimization by peeling back the layers, assessing all of the telecom spend and bringing an objective voice into the conversation. It’s about collaboration. Ultimately, contract negotiation is part of the process and some renewals may be appropriate. The question is whether you arrive at your strategy based on objective input from a collaborative partner or merely a price quote from a cooperative vendor. The difference is vast. We’re trying to open the eyes of executives to what a collaborative relationship looks like and can mean to the bottom line.
How can you be sure the approach you are taking is truly strategic?
The heart of it is having the right analytics, the right insight into the provider world, and a commitment to an over- arching, specific direction. The dynamics of the industry are continuing to evolve and new technologies are available, but who has time to test all the options? Ultimately, you need to know players in the industry who have both the insight to provide guidance and the accountability to be responsible for the direction they suggest. This goes beyond the average consultant. Companies need a trusted adviser. Most successful executives wouldn’t dare go through life without a trusted wealth manager. Why would they allow the business to go without a trusted adviser for such a critical service as communications? Executives don’t just need a consultant. They need someone whose neck is on the line for any solution they suggest. They need a trusted adviser.
Shane Heise is the president of Simplify Inc. To learn more about Simplify, call 87-SIMPLIFY ext. 236, or visit
As executives well know, the ebbs and flows of growing a business can lead to evolving IT infrastructure requirements. When outsourcing IT infrastructure to a data center colocation, managed hosting and managed services provider, identifying which IT services to outsource and which functions should remain in house is critical.
Smart Business spoke with Don Goodwin, chief revenue officer at Latisys, on how executives can effectively determine which level of IT outsourcing (ITO) would most benefit their organization.
What risks or costs do organizations face when handling IT infrastructure in house?
As companies grow, their IT infrastructure evolves, requiring additional capacity and process efficiencies. The systems and IT infrastructure required to support a company’s operations can quickly exceed available physical space, resources and capabilities provided by the in-house data room or data center. The company might then pursue a path of building additional data center space on site, or place their IT equipment in less secure, less reliable environments within their building — which risks security, reliability and uptime.
In addition to incurring structural and facility-based capital expenses as IT equipment needs increase, companies also must add appropriate staff to monitor and maintain all systems and ensure continuous uptime. They are often specialized for the systems they are hired to manage — and don’t contribute to the core business of the company.
Are there different types of ITO a company can leverage?
There are four ITO profiles enterprises typically align with. The first ITO profile is ‘off-premise,’ which refers to a company ready to move its IT infrastructure to a secure, redundant powered ‘off-premise’ data center facility. The second profile is ‘off-load,’ whereby a company seeks to ‘off-load’ some or all non-core IT systems and software applications. The third is ‘optimize,’ for companies with requirements for additional infrastructure management along with preserving capital. These companies benefit from access to proven support teams, bundled hardware and software, and a service level agreement for a monthly operating expense instead of incurring the capital outlay and headcount expense. Finally, with the ‘outsource’ ITO profile, a company would seek support for its above-platform applications and turnkey support services, in turn shifting segments of their IT systems, process and/or functions to service providers specializing in managing IT functions on a captive or shared tenant basis.
Please describe each ITO profile and the services that would best fit their requirements.
Off-premise: The typical off-premise company is looking for more security, reliability and scalability than what its in-house data center capabilities can provide. It requires a colocation provider that can offer data center space, with redundant power and cooling to ensure 100 percent uptime and 24-7 physical security, where the company owns and maintains its own equipment and software.
Off-load: Companies seeking to off-load IT infrastructure management often leverage managed services provided by a colocation provider to augment their colocation solution. They want to take advantage of managed security services such as managed firewall and VPN, as well as intrusion detection and intrusion prevention services. Companies may want to leverage around-the-clock availability of certified IT professionals for ongoing monitoring and management of core network services for their production environment, as well as managed storage and managed backup for complete data protection. This can often be combined with geographically dispersed data centers for disaster recovery and business continuity plans.
Optimize: As an enterprise’s IT requirements for increased efficiency and consolidation become a strong fit for virtualization and managed servers, it may explore options of how best to achieve the ability to turn up and run its applications quickly with minimal involvement from its own technical resources. To gain the benefits of this approach without incurring significant capital investment, companies can leverage the packaged solutions offered by a data center service provider and turn the associated monthly charges into more manageable operational expenses that permit greater financial flexibility.
Outsource: This company desires the fea-tures, functionality and benefits of its busi-ness applications without the headache of managing and running them. They want to fully outsource their investment in IT infrastructure and day-to-day IT management to achieve the highest level of performance for their spend. They seek a provider or providers who can go beyond the network and equipment, and provide above platform-level support and services.
What questions should an organization ask itself to understand what profile it falls into?
A company should first determine whether or not IT infrastructure management is one of its core competencies. The answer to this question goes a long way in determining the ITO profile that fits them best. Companies should consider what infrastructure improvements and additional capabilities can be achieved, and look at areas of IT spend that could more efficiently be managed by leveraging firms that provide IT infrastructure management as their core business. The decision will depend on their immediate and long-term goals and resource availability.
What type of provider offers ITO and what are the primary benefits of this approach?
In addition to the traditional IT consultants and contract firms for monitoring and maintenance services, the outsourced infrastructure providers are typically classified as data center or colocation providers, managed hosting and managed services providers. While each provides a distinct offering, finding a provider that can offer combinations of, or all of, these capabilities will often result in cost savings, as well as increased ease of management and control for the enterprise.
Don Goodwin is chief revenue officer at Latisys. Reach him at firstname.lastname@example.org.