Cloud com­put­ing trends to watch out for in 2014

InformationWeek - - Opinion -

The en­ter­prise cloud has be­gun its tran­si­tion to the fast lane. In the last 18 months, draw­ing from sev­eral CXO con­ver­sa­tions, I clearly see at least an aver­age 10 per­cent in­crease in the num­ber of en­ter­prises us­ing at least one cloud plat­form.

The cloud is also in­creas­ingly seen as the next evo­lu­tion­ary step in IT ser­vices de­liv­ery, with more than half of the en­ter­prises world­wide in­te­grat­ing cloud bud­gets into over­all IT spends, as op­posed to treat­ing it as a par­al­lel project. An­other sign of en­ter­prise cloud ma­tu­rity is that scal­a­bil­ity, re­silience, agility, speed-to-mar­ket and abil­ity to in­no­vate, rather than only cost, are clearly the key driv­ers of adop­tion.

Based on our ex­pe­ri­ence, and the cur­rent mo­men­tum of the cloud, we be­lieve that 30-50 per­cent of en­ter­prises will have a clearly ar­tic­u­lated cloud strat­egy roadmap in 2014, un­am­bigu­ously defin­ing strate­gic cloud mile­stones within the broader con­text of their en­ter­prise IT strat­egy. With most or­ga­ni­za­tions tak­ing a crawl-walk-run jour­ney into the cloud, this blue­print will en­able them to pick and choose ser­vices and providers as they evolve, as well as adopt ap­pro­pri­ate met­rics to pe­ri­od­i­cally mea­sure the out­comes of their cloud de­ci­sions.

Here are some fea­tures that will de­fine the progress and pace of the cloud jour­ney in 2014:

The IT or­ga­ni­za­tion will grav­i­tate to­wards out­come-based, SLA-ori­ented con­structs

The tech­nol­ogy head­quar­ters of the en­ter­prise will be­gin to trans­form it­self into a ser­vices bro­ker­ing pow­er­house bring­ing to­gether the best of var­i­ous ser­vice providers. And the trans­for­ma­tion will gain im­pe­tus from the or­ga­ni­za­tion’s cloud strat­egy. There will be in­creas­ingly greater lev­els in ma­tu­rity in busi­ness-IT part­ner­ing.

The most vis­i­ble im­pact of these re­de­fined terms of en­gage­ment will be on SLAs. Users will in­sist on mov­ing away from stan­dard­ized SLAs to­wards agree­ments that more ac­cu­rately cap­ture their busi­ness-led pri­or­i­ties. Also, in a move that may well spell the end of ven­dor lock-in, more and more SLAs will in­cor­po­rate con­testa­bil­ity clauses and open stan­dards pro­vid­ing users the lee­way to seek best-in- class so­lu­tions from an evolv­ing land­scape of ser­vice providers, or change providers at will.

Pub­lic cloud will be ready for en­ter­prise, and en­ter­prise ready for the pub­lic cloud

This means early adopters have the world to gain in terms of speed-to-mar­ket, agility, in­no­va­tion and cost ad­van­tages. Con­cepts like sand­boxes, cages, a healthy port­fo­lio of ser­vices, lo­ca­tion-spe­cific se­cu­rity and reg­u­la­tory re­quire­ments, trans­par­ent re­cov­ery pro­ce­dures, etc., will be­come key con­sid­er­a­tions in the en­ter­prise en­gage­ment model. And this will be sat­is­fac­to­rily ad­dressed in the hy­brid cloud ecosys­tem. Start­ing next year, pub­lic cloud ser­vice providers will raise their of­fer­ings and their pitches to re­flect en­ter­prise re­quire­ments and pri­or­i­ties, bet­ter than ever be­fore.

Say hello to trans­formed out­sourc­ing with the cloud in per­spec­tive

The num­ber of IT out­sourc­ing con­tracts in­clud­ing a cloud com­po­nent has tripled in the last three years. The pro­por­tion of cloud ser­vices within a typ­i­cal out­sourc­ing deal is also in­creas­ing. These de­vel­op­ments will com­pel rad­i­cal struc­tural changes in the na­ture of sourc­ing con­tracts. In the scal­able, ag­ile, flex­i­ble world of cloud com­put­ing, multi-year mono­lithic con­tracts will be­come ex­tinct. Users will in­sist on in­clud­ing con­tin­gen­cies and vari­ables into con­tracts to en­able them to rapidly re­align ven­dor re­la­tion­ships in or­der to lever­age emer­gent com­pe­ten­cies in the cloud ecosys­tem. Suc­cess­ful cloud sourc­ing con­tracts will be struc­tured around in­di­vid­ual busi­ness rules and needs rather than on long-term ven­dor part­ner­ships.

WE’LL LET GO OFF THE LEGACY

Ad­dress­ing the con­straints cre­ated by legacy ap­pli­ca­tions and in­fra­struc­ture has al­ways been a top pri­or­ity for en­ter­prise tech­nol­ogy stew­ards. Start­ing 2014, the cloud will spur a two-fold in­crease in ap­pli­ca­tion and in­fra­struc­ture mod­ern­iza­tion pro­grams.

Mod­ern­iza­tion will be­come an im­per­a­tive for en­ter­prises look­ing to lever­age new-age pos­si­bil­i­ties with the cloud as well as make the most of con­verg­ing tech­nolo­gies in mo­bil­ity, so­cial and Big Data, which are best served by the dis­trib­uted com­put­ing model. Any hy­brid en­ter­prise IT model that still has a sig­nif­i­cant legacy com­po­nent will cre­ate op­er­a­tional bot­tle­necks for or­ga­ni­za­tions. Only with large-scale mod­ern­iza­tion will en­ter­prises be able to fully re­al­ize the cost, ef­fi­ciency, agility and flex­i­bil­ity fea­tures of the cloud.

The cen­ter of grav­ity, around cloud, will be­gin to shift from in­fra­struc­ture to ap­pli­ca­tions

En­ter­prises’ cloud strat­egy will

have an in­creas­ingly bal­anced view of both in­fra­struc­ture and ap­pli­ca­tions. All of this will be geared to in­spire con­fi­dence amongst users con­cerned with in­ter­op­er­abil­ity and porta­bil­ity is­sues. This will man­i­fest it­self in sev­eral ways — like a move to­wards a cloud-stan­dard API that will en­able users to con­nect and evolve ap­pli­ca­tions across the cloud ecosys­tem based on their busi­ness ob­jec­tives. The cloud ecosys­tem will be­gin to look more holis­tic.

Cur­rently, more than 160 dif­fer­ent stan­dards gov­ern cloud com­put­ing sys­tems. The shift to­wards com­mon or open stan­dards for cloud de­ploy­ments will be cen­tral to the de­vel­op­ment of the cloud model, es­pe­cially if fea­tures like in­ter­op­er­abil­ity and porta­bil­ity are to be re­al­ized

Stan­dard­iza­tion will take cen­ter stage

The cloud ecosys­tem to­day is char­ac­ter­ized by a plethora of stan­dards, mostly unique to ser­vice providers and there­fore in­com­pat­i­ble with other plat­forms.

Cur­rently, more than 160 dif­fer­ent stan­dards gov­ern cloud com­put­ing sys­tems. This sit­u­a­tion has the po­ten­tial to dampen the growth prospects of the cloud. The shift to­wards com­mon or open stan­dards for cloud de­ploy­ments will be cen­tral to the de­vel­op­ment of the cloud model, es­pe­cially if fea­tures like in­ter­op­er­abil­ity and porta­bil­ity are to be re­al­ized. The move­ment for a com­mon cloud stan­dard will have to be spear­headed by users to en­sure that the cloud prom­ise does not get buried un­der an overwhelming bar­rage of in­com­pat­i­ble op­er­at­ing prin­ci­ples.

Con­sor­tiums like the Open Data Cen­ter Al­liance (ODCA), framed to fo­cus at­ten­tion on the cry­ing need for a de­pend­able frame­work to progress the evo­lu­tion of or­ga­ni­za­tional stan­dards, that stream­line the cloud jour­ney, will grow in stature.

New lead­ers will emerge

The fi­nan­cial ser­vices sec­tor, given its near- ob­ses­sive con­cerns of com­pli­ance and se­cu­rity, seems an un­likely can­di­date to lead cloud adop­tion. But sur­pris­ingly, our anal­y­sis strongly in­di­cates that the sec­tor will in­vest al­most 4 per­cent of its to­tal IT spend on cloud tech­nolo­gies.

The cloud model will em­power banks on two counts — by help­ing them ad­dress the sig­nif­i­cant legacy com­po­nent that still ex­ists, and al­low­ing them to en­hance the scale and scope of their prod­uct and ser­vice portfolios in the face of a com­pet­i­tive on­slaught from more tech­no­log­i­cally en­abled play­ers. Tak­ing a geo-view, by size, North Amer­ica will con­tinue to dom­i­nate cloud ser­vices spend­ing. But Asia-Pa­cific and Latin Amer­ica will set the pace of growth for the cloud mar­ket.

Mo­bile, an­a­lyt­ics and so­cial so­lu­tions will still be driven in si­los

The abil­ity to deliver a uni­fied mo­bile, an­a­lytic and so­cial so­lu­tion is one of the key op­por­tu­ni­ties pre­sented by cloud adop­tion. And yet, most en­ter­prises still have siloed strate­gies for each of these in­ter­twined com­po­nents.

Just as it is hard to imag­ine a suc­cess­ful scal­able mo­bile de­ploy­ment on non- cloud in­fra­struc­ture, it is hard to en­vi­sion a mo­bile or so­cial so­lu­tion that will ac­tu­ally be use­ful with­out ac­cess to on-the-fly an­a­lyt­ics.

In short, nei­ther mo­bil­ity nor an­a­lyt­ics nor so­cial should be viewed in si­los — as some­thing to be bolted even­tu­ally onto a cen­tral cloud strat­egy. And yet, en­ter­prises in 2014, will not adopt this co­he­sive strat­egy. How­ever, the first ma­ture plans for these com­po­nents to be em­bed­ded into a core cloud strat­egy will be for­mu­lated.

In the last two years, the cloud has gen­er­ated suf­fi­cient reach and mo­men­tum to be­come a se­ri­ous con­tender in IT ser­vices de­liv­ery. But as it moves from hype to en­light­en­ment, there are still some is­sues that need to be ad­dressed by users, ser­vice providers and pol­icy mak­ers to take the cloud to its po­ten­tial as quickly as pos­si­ble.

I am plac­ing my bets on a great chunk of this hap­pen­ing in 2014.

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Vishnu G Bhat, is Se­nior Vice Pres­i­dent and Global Head, Cloud & Big Data, In­fosys

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