Transcript
of a discussion on why
changes in cloud deployment models are forcing a rethinking of IT economics,
and maybe even the very nature of acquiring and cost optimizing digital
services.
Dana Gardner: Hello,
and welcome to the next edition of the BriefingsDirect Voice of the Analyst
podcast series. I’m Dana Gardner, Principal
Analyst at Interarbor
Solutions, your host and moderator for this ongoing discussion on the
latest insights into successful digital
transformation.
This hybrid IT management
strategies interview explores new ways that businesses should procure and
consume IT-as-a-service. We’ll now hear from an IT industry analyst on why changes
in cloud deployment models are forcing a rethinking of IT economics, and maybe
even the very nature of acquiring and cost-optimizing digital business services.
Here to help us explore the everything-as-a-service
business model is Rhett Dillingham,
Vice President and Senior Analyst at Moor Insights and Strategy.
Welcome back, Rhett.
Rhett Dillingham: Hi, Dana.
It’s good to be here.
Gardner: What is
driving change in the procurement of hybrid- and multi-cloud
services?
Dillingham: What
began as organic adoption -- from the developers and business units seeking agility
and speed -- is now coming back around to the IT-focused topics of governance,
orchestration across platforms, and modernization of private infrastructure.
Gardner: So
the way you acquire IT these days isn’t apples or oranges, public or private,
it’s more like … fruit salad. There are so many different ways to acquire IT
services that it’s hard to measure and to optimize.
Dillingham: And there
are trade-offs. Some organizations are focused on and adopt a single public
cloud vendor. But others see that as a long-term risk in management, resourcing,
and maintaining flexibility as a business. So they’re adopting multiple cloud
vendors, which is becoming the more popular strategic orientation.
Gardner: For
those organizations that don’t want mismanaged “fruit salad” -- that are trying
to homogenize their acquisition of IT services even as they use hybrid cloud
approaches -- does this require a reevaluation of how IT in total is financed?
Champion the cloud
Dillingham: Absolutely,
and that’s something you can address, regardless of whether you’re adopting a
single cloud or multiple clouds. The more you use multiple resources, the more you
are going to consider tools that address multiple infrastructures -- and not base
your capabilities on a single vendor’s toolset. You are going to go with a
cloud management vendor that produces tools
that comprehensively address security, compliance, cost management, and monitoring,
et cetera.
Gardner: Does
the function of IT acquisitions now move outside of IT? Should companies be
thinking about a chief procurement officer (CPO) or chief financial officer (CFO)
becoming a part of the IT purchasing equation?
Dillingham: By
virtue of the way cloud has been adopted -- more by the business units – they
got ahead of IT in many cases. This has been pushed back toward gaining the fuller
financial view. That move doesn’t make the IT decision-maker into a CFO as much
as turn them into a champion of IT. And IT goes back to being the governance arm,
where traditionally they been managing cost, security, and compliance.
It’s natural for the business
units and developers to now look
to IT for the right tools and capabilities, not necessarily to shed
accountability but because that is the traditional role of IT, to enable those capabilities.
IT is therefore set up for procurement.
IT is best set up to look at
the big picture across vendors and across infrastructures rather than the
individual team-by-team or business unit-by-business unit decisions that have
been made so far. They need to aggregate the cloud strategy at the highest organizational
level.
Gardner: A central
tenet of good procurement is to look for volume discounts and to buy in bulk. Perhaps
having that holistic and strategic approach to acquiring cloud services lends
itself to a better bargaining position?
Dillingham: That’s
absolutely the pitch of a cloud-by-cloud vendor approach, and there are trade-offs.
You can certainly aggregate more spend on a single cloud vendor and potentially
achieve more discounts in use by that aggregation.
The rebuttal is that on a long-term
basis, your negotiating leverage in that relationship is constrained versus if
you have adopted multiple cloud infrastructures and can dialogue across vendors
on pricing and discounting.
Now, that may turn into more
of an 80/20-, 90/10-split than a 50/50-split, but at least by having some cross-infrastructure
capability -- by setting yourself up with orchestration, monitoring, and governance
tools that run across multiple clouds -- you are at least in a strategic
position from a competitive sourcing perspective.
Gardner: I
think that’s why we’ve seen vendors like Hewlett Packard Enterprise (HPE)
put an increased emphasis on multi-cloud
economics, and not just the capability to compose cloud services. The
issues we’re bringing up force IT to rethink the financial implications, too. Are
the vendors on to something here when it comes to providing insight and experience
in managing a multi-cloud market?
Follow the multi-cloud tour guide
Dillingham: Absolutely,
and certainly from the perspective that when we talk multi-cloud, we are not
just talking multiple public clouds. There is a reality of large existing
investments in private infrastructure that continue for various purposes. That
on-premises technology also needs cost optimization, security, compliance, auditability,
and customization of infrastructure for certain workloads.
Consultative
input is very valuable when you see how much pattern-matching there is
across customers -- and not just within the same industry but cross
industries.
And that consultative input is
very valuable when you see how much pattern-matching there is across customers
– and not just within same industry but across industries. The best insights
will come from knowing what it looks like to triage application portfolios,
what migrations you want across cloud infrastructures, and the proper set up of
comprehensive governance, control processes, and education structures.
Gardner: Right.
I’m sure there are systems integrators, in addition to some vendors, that are
going to help make the transition from traditional IT procurement to everything-as-a
service. Their lessons learned will be very valuable.
That’s more intelligent than
trying to do this on your own or go down a dark alley and make mistakes, because
as we know, the cloud providers are probably not going to stand up and wave a
flag if you’re spending too much money with them.
How to Solve Cost and Utilization Challenges of Hybrid Cloud
Dillingham: Yes,
and the patterns of progression in cloud orientation are clear for those consultative
partners, based on dozens of implementations and executions. From that experience
they are far more thoroughly aware of the patterns and how to avoid falling
into the traps and pitfalls along the way, more so than a single organization could
expect, internally, to be savvy about.
Gardner: It’s
a fast-moving target. The cloud providers are bringing out new services all the
time. There are literally thousands of different cloud service SKUs
for infrastructure-as-a-service, for storage-as-a-service, and for other APIs
and third-party services. It becomes very complex, very dynamic.
Do you have any advice for how
companies should be better managing cloud adoption? It seems to me there should
be collaboration at a higher level, or a different type of management, when it
comes to optimizing
for multi-cloud and hybrid-cloud economics.
Cloud collaboration strategy
Dillingham: That really comes back to the requirement that the IT
organization partner with the business units. The more business units there are
in the organization, the more IT is critical in driving collaboration at the
highest organizational level and in being responsible for the overall cloud
strategy.
The cloud strategy
across the topics of platform selection, governance, process, and people skills
-- that’s the type of collaboration needed. And it flows into these
recommendations from the consultancies of how to avoid the traps and pitfalls.
For example: Avoiding mismanagement of expectations and goals in order to drive
clear outcomes on the execution of projects, making
sure that security and compliance are considered and involved from a functional
perspective all the way through, and on down the list.
The decision of what advice to
bring in is really about the topic and the selection on the menu. Have you considered
the uber strategy and approach? How well have you triaged your application
portfolio? How can you best match capabilities to apps across infrastructures
and platforms?
Do you have migration planning?
How about migration execution? Those can be similar or separate items. You also
have development methodologies, and the software platform choices to best support
all of that along with security and compliance expertise. These are all aspects
certain consultancies will have expertise on more than others, and not many are
going to be strong across all of them.
Gardner: It certainly
sounds like a lot of planning and perhaps reevaluating the ways of the past. I’m
afraid we’ll have to leave it there. We have been exploring new ways that
businesses can procure and consume IT-as-a-service, and we have
learned why changes in cloud deployment models are forcing a rethinking of IT
economics in general.
Please join me in thanking out
guest, Rhett Dillingham, Vice President and Senior Analyst at Moor Insights and
Strategy. Thank you, sir.
Dillingham: Great
to be with you, Dana.
Gardner: And a
big thank you as well to our audience for joining this BriefingsDirect Voice of
the Analyst hybrid IT management strategies interview. I’m Dana Gardner,
Principal Analyst at Interarbor Solutions, your host for this ongoing series of
Hewlett Packard Enterprise-sponsored discussions.
Thanks again for listening.
Please pass this along to your IT community, and do come back next time.
Transcript
of a discussion on why
changes in cloud deployment models are forcing a rethinking of IT economics,
and maybe even the very nature of acquiring and cost optimizing digital
services. Copyright Interarbor Solutions, LLC, 2005-2019. All rights reserved.
Transcript
of a discussion on how
a Canadian maker of containers leverages the Internet of Things to create a
positive cycle of insights and applied learning.
Our next manufacturing modernization
and optimization case study centers on how a Canadian maker of containers
leverages the Internet of Things
(IoT) to create a positive cycle of insights and applied learning.
We will now hear how CuBE Packaging Solutions,
Inc. in Aurora, Ontario has deployed edge intelligence to make 21
formerly isolated machines act as a single, coordinated system as it churns out
millions of reusable package units per month.
Stay with us as we explore how
harnessing edge
data with more centralized real-time analytics integration cooks up
the winning formula for an ongoing journey of efficiency, quality control, and
end-to-end factory improvement.
Here to describe the
challenges and solutions for injecting IoT
into a plastic container’s production advancement success journey is Len Chopin,
President at CuBE Packaging Solutions. Welcome, Len.
Len Chopin: Hi, thanks
for having me.
Gardner: Len,
what are the top trends and requirements driving the need for you to bring more
insights into your production process?
Chopin: The
very competitive nature of injection molding
requires us to stay ahead of the competition and utilize the
intelligent edge to stay abreast of that competition. By tapping
into and optimizing the equipment, we gain on downtime efficiencies, improved throughput,
and all the things that help drive more to the bottom line.
Gardner: And
this is a win-win because you’re not only improving quality but you're able to
improve the volume of output. So it’s sort of the double-benefit of better and
bigger.
Chopin:
Correct. Driving volume is key. When we are running, we are making money, and we
are profitable. By optimizing that production, we are even that much more
profitable. And by using analytics and protocols for preventive and predictive maintenance,
the IoT solutions drive an increase the uptime on the equipment.
Gardner: Why
are sensors in of themselves not enough to attain intelligence at the edge?
Chopin: The
sensors are reactive. They give you information. It’s good information. But leaving
it up to the people to interpret [the sensor data] takes time. Utilizing
analytics, by pooling the data, and looking for trends, means IoT is pushing to
us what we need to know and when.
Otherwise we tend to look at a
lot of information that’s not useful. Utilizing the intelligent edge means it's
pushing to us the information we need, when we need it, so we can react
appropriately with the right resources.
Gardner: In
order to understand the benefits of when you do this well, let's talk about the
state at CuBE Packaging when you didn't have sensors. You weren't processing
and you weren't creating a cycle of improvement?
Chopin: That
was firefighting mode. You really have no idea of what's running, how it’s
running, is it trending down, is it fast enough, and is it about to go down. It
equates to flying blind, with blinders on. It’s really hard in a manufacturing
environment to run a business that way. A lot of people do it, and it’s affordable
-- but not very economical. It really doesn’t drive more value to the bottom
line.
Gardner: What
have been the biggest challenges in moving beyond that previous “firefighting” state
to implementing a full IoT capability?
Chopin: The dynamic
within our area in Canada is resources. There is lot of technology out there. We
rise to the top by learning all about what we can do at the edge, how we can best
apply it, and how we can implement that into a meaningful roadmap with the
right resources and technical skills of our IT staff.
It’s a new venture for us, so
it's definitely been a journey. It is challenging. Getting that roadmap and then
sticking to the roadmap is challenging, but as we go through the journey we
learn the more relevant things. It's been a dynamic roadmap, which it has to be
as the technology evolves and we delve into the world of IoT, which is quite fascinating
for us.
Gardner: What
would you say has been the hardest nut to crack? Is it the people, the process,
or the technology? Which has been the most challenging?
Trust the IoT process
Chopin: I
think the process, the execution. But we found that once you deploy IoT, and you
begin collecting data and embarking on analytics, then the creative juices become
engaged with a lot of the people who previously were disinterested in the whole
process.
But then they help steer the
ship, and some will change the direction slightly or identify a need that we
previously didn't know about – a more valuable way than the path we were on. So
people are definitely part of the solution, not part of the problem. For us, it’s
about executing to their new expectations and applying the information and technology
to find solutions to their specific problems.
We have had really good buy-in
with the people, and it’s just become about layering on the technical resources
to help them execute their vision.
Gardner: You have
referred to becoming, “the Google of manufacturing.” What do you mean by that,
and how has Hewlett Packard Enterprise (HPE)
supported you in gaining that capability and intelligence?
People are definitely part of the solution, not part of the problem. For us, it's about executing to their new expectations and applying information and technology to find solutions to specific problems.
Chopin: “The Google
of manufacturing” was first coined by our owner, JR. It’s his vision so it’s my
job to bring it to fruition. The concept is that there’s a lot of cool stuff
out there, and we see that IoT is really fascinating.
My job is to take that
technology and turn it into an investment with a return on investment (ROI) from
execution. How is that all going to help the business? The “Google of manufacturing”
is about growth for us -- by using any technology that we see fit and having
the leadership to be open to those new ideas and concepts. Even without having
a clear vision of the roadmap, it means focusing on the end results. It’s been a
unique situation. So far it’s been very good for us.
Gardner: How
has HPE helped in your ability to exploit technologies both at the edge and at
the data center core?
Chopin: We
just embarked on a large equipment expansion [with HPE], which is doubling our
throughput. Our IT backbone, our core, was just like our previous equipment -- very
old, antiquated, and not cutting edge at all. It was a burden as opposed to an
asset.
Part of moving to IoT was putting
in a solid platform, which HPE has provided. We work with our integrator and a
project team that mapped out our core for the future. It’s not just built for today's
needs -- it's built for expansion capabilities. It's built for year-two, year-three.
Even if we’re not fully utilizing it today -- it has been built for the future.
HPE has
more things coming down the pipeline that are built on and integrated to this
core, so that there are no real limitations to the system. No longer will we
have to scrap an old system and put a new one in. It’s now scalable, which we think
of as the platform for becoming the “Google of manufacturing,” and which is going
to be critical for us.
Gardner: Future-proofing
infrastructure is always one of my top requirements. All right, please tell us about
CuBE Packaging, your organization’s size, what you're doing, and what end
products are.
The CuBE takeaway
Chopin: We have
a 170,000-square-foot facility, with about 120 employees producing injection-molded
plastic containers for the food service industry, for home-meal replacement, and
takeout markets, distributed to Canada as well as the US, which is obviously a huge
and diverse market.
We also have a focus on
sustainability. Our products are reusable and recyclable. They are a premier
product that come with a premier price. They are also customizable and brandable,
which has been a key to CuBE’s success. We partner with restaurants, with sophisticated
customers, who see a value in the specific branding and of having a robust
packaging solution.
Gardner: Len,
you mentioned that you're in a competitive industry and that margin is
therefore under pressure. For you to improve your bottom line, how do you
account for more productivity? How are you turning what we have described in
terms of an IoT and data capability into that economic improvement to your
business outcome?
Chopin: I refer
to this as having a plant within a plant. There is always lot more you can squeeze
out of an operation by knowing what it’s up to, not day-by-day, but minute-by-minute.
Our process is run quite quickly and so slippage in machine cycle times can
occur rapidly. We must grasp the small slippages, or predict failures, or when
something is out of technical specifications from the injection molding
standpoint or we could be producing a poor-quality product.
Getting a handle on what the
machines are doing, minute-by-minute-by-minute gives us the advantage to
utilize the assets and the people and so to optimize the uptime, as well as
improve our quality, to get more of the best product to the market. So it
really does drive value right to the bottom line.
Gardner: A big
buzzword in the industry now is artificial
intelligence (AI). We are seeing lots of companies dabble in that. But
you need to put in place certain things before you can take advantage of those
capabilities that not only react but have the intelligence to prescribe new
processes for doing things even more efficiently.
Are you working in conjunction
with your integrator and HPE to allow you to exploit AI when it becomes mature
enough for organizations like your own?
AI adds uptime
Chopin: We
are already embarking on using sensors for things that were seemingly unrelated.
For example, we are picking up data points off of peripheral equipment that
feed into the molding process. This provides us a better handle on those inputs
to the process, inputs to the actual equipment, rather than focusing on the
throughput and of how many parts we get in a given day.
For us, the AI is about that
equipment uptime and of preventing any of it going down. By utilizing the
inputs to the machines, it can notify us in advance, when we need to be
notified.
Rather than monitoring
equipment performance manually with a clipboard and a pen, we can check on run
conditions or temperatures of some equipment up on the roof that's critical to
the operation. The AI will hopefully alert us to things that we don't know
about or don't see because it could be at the far end of the operations. Yet
there is a codependency on a lot of that pre-upstream equipment that feeds to
the downstream equipment.
So for us to gain transparency
into that end-to-end process and having intelligence built-in enough to say, “Hey,
you have a problem -- not yet, but you're going to have a problem,” allows us
to react before the problem occurs and causes a production upset.
Rather than monitoring equipment performance manually with a clipboard and a pen, we can check on run conditions or temperatures of some equipment up on the roof if that is critical to the operations.
Gardner: You can
attain a total data picture across your entire product lifecycle, and your
entire production facility. Having that allows you to really leverage AI.
Sounds like that means a lot
of data over long period of time. Is there anything about what's happening at
that data center core, around storage, that makes it more attractive to do this
sooner than later?
Chopin: As I
mentioned previously, there are a lot of data points coming off the machines. The
bulk of it is useless, other than from an historical standpoint. So by utilizing
that data -- not pushing forward what we don't need, but just taking the
relevant points -- we piggyback on the programmable logic controllers to just gather
the data that we need. Then we further streamline that data to give us what
we're looking for within that process.
It's like pushing out only the
needle from the haystack, as opposed to pushing the whole haystack forward.
That’s the analogy we use.
Gardner: So
being more intelligent about how you gather intelligence?
Gardner: I’m
afraid we’ll have to leave it there. We have been exploring how a Canadian
maker of containers is leveraging IoT to create a positive cycle of insights
and applied learning. And we've learned how harnessing edge data in centralized,
real-time analysis can cook up a winning formula for an ongoing journey of
efficiency, quality control, and ongoing, end-to-end factory improvement.
Please join me in thanking our
guest, Len Chopin, President at CuBE Packaging Solutions in Aurora, Ontario.
Thank you so much, Len.
Chopin:
Thanks for having me.
Gardner: And a
big thank you as well to our audience for joining this BriefingsDirect Voice of
the Customer digital transformation success story. I’m Dana Gardner, Principal
Analyst at Interarbor Solutions, your host for this ongoing series of Hewlett Packard
Enterprise-sponsored interviews.
Thanks again for listening.
Please pass this along to your IT community, and do come back next time.
Transcript
of a discussion on how
a Canadian maker of containers leverages the Internet of Things to create a
positive cycle of insights and applied learning. Copyright Interarbor
Solutions, LLC, 2005-2019. All rights reserved.
Transcript
of a discussion on how businesses struggle with cloud computing adoption, and how
they could improve by attaining a culture directed at cloud consumption and
total productivity.
We will now examine why many
businesses struggle with cloud
computing adoption, and how they could improve by attaining a
culture directed at cloud consumption and total productivity. Because of
inertia, a lack of skills, and even outright hostility, some enterprises are stumbling
in their march to cloud use due to behavior and perception -- and
not the actual technology hurdles.
We will now hear from an observer
of cloud adoption patterns on why a cultural solution to adoption may be more
important than any other aspect of digital business
transformation.
Here to help us explore why cloud inertia can derail business advancement is Edwin Yuen, Senior Analyst for Cloud
Services and Orchestration, Data Protection, and DevOps at Enterprise Strategy Group (ESG). [Note:
Since this podcast was recorded on Nov. 15, 2018, Yuen has become
principal product marketing manager at Amazon Web Services.]
Welcome, Edwin. How are you?
Edwin Yuen: I’m
doing fine, thank you.
Gardner:
Edwin, why are enterprises finding themselves unready for public cloud adoption
culturally?
Yuen: Culturally
the issue with public cloud adoption is whether IT is prepared to bring in public
cloud. I bring up the IT issue because public
cloud usage is actually really high within business organizations.
At ESG, we have found that cloud
use is pretty significant -- well over 80 percent are using some sort of public
cloud service. It’s very high for infrastructure- (IaaS) and platform-as-a-service
(PaaS).
But the key here is, “What is
the role of IT?” We see a lot of business end-users and others essentially
doing Shadow IT – of going
around IT if they feel like their needs are not met. That actually increases
the friction between IT and the business.
It also leads to people going
into the public cloud before they are ready, before there’s been a proper evaluation
– from a technical, cost, or even a convenience point of view. That can potentially
derail things.
But there is an opportunity
for IT to reset the boundaries and meet the needs of the end users, of thoughtfully
getting into the public cloud.
Gardner: We may
be at the point of having too much of a good thing. Even if people are doing
great things with cloud computing inside of an organization, unless it’s strategically
oriented to process, fulfillment, and a business outcome, then the benefits be
can lost.
Plan before you go to public
cloud
Yuen: When
line of business (LOB) or other groups are not working with core IT in going to
the public cloud, they get some advantages from it -- but they are not getting
the full advantage. It’s like going from an old piece of smartphone technology,
at 7 or 8 years old, and then only going up to the fifth or sixth best phone. It’s
a significant upgrade, but it’s not the optimal way to do it. They’re not
getting the full benefits.
The question is, “Are you
getting the most out of it, and is that thoughtfulness there?” You want to
maximize the capabilities and advantages you get from public cloud and minimize
the inconvenience and cost. Planning
is absolutely critical for that -- and it involves core IT.
So how do you bring about a
cultural shift that says, “Yes, we are going into the public cloud. We are not
trying to stop you. We are not being overly negative. But what we are trying to
do is optimize it for everybody across the board, so that we as a company can
get the most out of it because there are so many benefits -- not just
incremental benefits that you get from immediately jumping in.”
Gardner: IT
needs to take a different role, of putting
in guardrails in terms of cloud services consumption, compliance,
and security. It seems to me that procurement is also
a mature function in most enterprises. They may also want to step in.
When you have people buying
goods individually on a credit card, you don’t necessarily take advantage of
volume purchasing, or you don’t recognize that you can buy things in bulk and
distribute them and get better deals or terms. Yet procurement groups are very
good at that.
Is there an opportunity to
better conduct cloud consumption like with procuring any other business
service, with all the checks, balances, and best practices?
Cut cloud costs, buy in bulk
Yuen: Absolutely,
and that’s an excellent point. I think people will often leave out procurement,
auditing, acquisitions or whatever department that there is for cloud. It
becomes critically important organizationally, especially from the end-user
point of view.
From the organizational point
of view, you can lose economies of scale. A lot of the cloud providers will
provide those economies of scales via an enterprise agreement. That allows for purchasing
power to be taken.
Yet if individuals go out and
leave procurement behind, it’s like shopping at a retailer for groceries
without ever checking for sales or coupons. Buying in volume is just a smarter
way to centralize the entire organization so you can leverage it. It becomes a
better cost for the line of business, obviously. Cloud is really a
consumption-based model, so planning needs to be there.
We’ve talked to a lot of
organizations. As they jump into cloud, they expect cost savings, but sometimes
they get an increase in cost because once you have that consumption model
available, people just go ahead and consume.
We've talked to a lot of organizations. As they jump into cloud, they expect cost savings, but sometimes they get an increase in cost because once you have that consumption model available, people just go ahead and consume.
And what that generates is a
variability in the cost of consumption; a variability in cost of cloud. A lot
of companies very quickly realize that they don’t have variable budgets -- they
have fixed budgets. So they need to think about how they use cloud and the
consumption cost for an entire year. You can’t just go about your work and have
some flexibility but then find that you are out of budget when you get to the
second half of the third or fourth quarter of the fiscal year.
You can’t budget on open-ended
consumption. It requires a balance across the organization, where you have
flexibility enough to be active -- and go into the cloud. But you also need to
understand what the costs are
throughout the entire lifecycle, especially if you have fixed
budgets.
Gardner: If
you get to the fourth quarter and you run out of funds, you can’t exactly turn
off the mission-critical applications either. You have to find a way to pay for
that, and that can wreak havoc, particularly in a public company.
In the public sector, in particular,
they are very much geared to a CAPEX budget. In cities, states, and the federal
government, they have to bond large purchases, and do that in advance. So, there
is dissonance culturally in terms of the economics around cloud and major
buying patterns.
Yuen: We
absolutely see that. There was an assumption by many that you would simply want
to go to an OPEX model and leave the CAPEX model behind. Realistically, what
you’re doing is leaving the CAPEX model behind from a consumption point of view
-- but you’re not leaving it behind from a budgeting and a planning point of
view.
The economic reality is that it
just doesn’t work that way. People need to be more flexible,
and that’s exactly what the providers have been adapting to. But the providers will
also have to allow you to consume in a way that allows you to lock down costs.
But that only occurs when the organization works together in terms of its total
requirements as opposed to just simply going out and using it.
The key for organizational
change is to drive a culture where you have flexibility and agility but work
within the culture to know what you want to do ahead of time. Then the
organization can do the proper planning to be fiscally responsible, and
fiscally execute on the operational plan.
Gardner: Going
to a cloud model really does force behavioral changes at the holistic business
level. IT needs to think more like procurement. Procurement needs to get more
technical and savvier about how to acquire and use cloud computing services. This
gets complex. There are literally thousands, if not tens
of thousands, of SKUs, different types of services, you could
acquire from any of the major public cloud providers.
Then, of course, the LOB people
need to be thinking differently about how they use and consume services. They
need to think about whether they should coordinate
with developers for customization or not. It’s rather complex.
So let’s identify where the cultural
divide is. Is it between IT of the old caliber and the new version of IT? Is it
a divide between the line of business people and IT? Between development and
operations? All the above? How serious is this cultural divide?
Holistic communication plans
Yuen: It
really is all of the above, and in varying areas. What we are seeing is that
the traditional roles within an organization have really been monolithic roles.
End-users were consumers, the central IT was a provider, and finances were
handled by acquisitions and the administration. Now, what we are seeing, is
that everybody needs to work together, and to have a much more holistic plan. There
needs to be a
new level of communication between those groups, and more of a
give-and-take.
It’s similar to the running of
a restaurant. In the past, we had a diner, that was the end user, and they
said: “I want this food.” The chef says, “I am going to cook this food.” The management
says, “This food costs this much.” They never really talked to each other.
They would do some back-and-forth
dialog, but there wasn’t a holistic understanding of the actual need. And, to
be perfectly honest, not everybody was totally satisfied. The diners were not
totally satisfied with the meal because it’s wasn’t made the way they wanted. They
weren’t going to pay for something they didn’t actually want. Finance fixed the
menu prices, but they would have liked to charge a little bit more. The chef really
wanted to cook a little bit differently or have the ability to shift things around.
The key for improved
cloud adoption is opening the lines of communication, bridging the
divides, and gaining new levels of understanding. As in the restaurant analogy,
the chef says, “Well, I can add these ingredients, but it will change the
flavor and it might increase the cost.” And then the finance people say, “Well,
if we make better food, then more people will eat it.” Or, “If we lower prices,
we will get more economies of scale.” Or, “If we raise prices we will reduce volume
of diners down.” It’s all about that balance -- and it’s an open discussion among
and between those three parts of the organization.
This is the digital
transformation we are seeing across the board. It’s about IT being more
flexible, listening to the needs of the end users, and being willing to be
agile in providing services. In exchange, the end users come to IT first,
understand where the cloud use is going, and can IT be responsive. IT knows better
what the users want. It becomes not just that they want solutions faster, but
by how much. They can negotiate based on actual requirements.
And
then they all work with operations and other teams and say, “Hey, can we get
those resources? Should we put them on-premises or off-premises? Should we
purchase it? Should we use CAPEX, or should we use OPEX?” It becomes about
changing the organization’s communication across the board and having the
ability to look at it from more than just one point of view. And, honestly,
most organizations really need help in that.
It’s not just scheduling a
meeting and sitting at a table. Most organizations are looking for solutions
and software. They need to bridge the gap, provide a translation of where
management of software can come together and say, “Hey, here are the costs
related to the capacity that we need.” So everyone sits together and says, “Okay,
well, if we need more capacity and the cost turns into this and the
capacity turns into that, you can do the analysis. You can determine if
it’s better in the cloud, or better on-premises. But it’s about more than just bringing
people together and communicating. It has to provide them the information they
need in order to have a similar discussion and gain common ground to work
together.
Gardner:
Edwin, tell us about yourself and ESG.
Pathway to the cloud
Yuen:
Enterprise Strategy Group is a research and analyst firm. We do a lot of work
with both vendors and customers, covering a wide range of topics. And we do
custom research and syndicated research. And that backs a lot of the findings
that we have when we have discussions about where the market is going.
I cover cloud orchestration
and services, data protection, and DevOps, which is really
the whole spectrum of how people manage resources and how to get the most out
of the cloud -- the great optimization of all of that.
As background, I have worked
at Hewlett
Packard Enterprise (HPE),Microsoft, and at several
startups. I have seen this whole process come together for the growth of the
cloud, and I have seen different changes -- when we had virtualization, when we
had great desktops, and seeing how IT and end-users have had to change.
This is a really exciting time
as we get public cloud going; more than just an idea. It’s like when we first
had the Internet. We are not just talking about cloud, we are talking what we
are doing in the cloud and how the cloud helps us. And that’s the sign of the
maturity of the market, but also the sign of what we need to do in order to
change, in order to take the best out of it.
This is a really exciting time as we get public cloud going. It's more than an idea. We are talking about how the cloud helps us. That's a sign of maturity and what we need to do to take the best out of it.
Gardner: Your
title is even an indicator that you have to rethink things -- not just in
slices or categories or buckets -- but in the holistic sense. Your long, but
very apropos, job title really shows what we have been talking about that
companies need to be thinking differently.
So that gets me to the issue
about skills. So maybe the typical IT person -- and I don’t want to get into
too much of a generalization or even stereotyping -- seems to be content to
find a requirement set, beaver along in their cubicle, maybe not be too
extroverted in terms of their skills or temperament, and really get the job
done. It is detail-oriented, it is highly focused.
But in order to accomplish
what companies need to do now -- to cross-pollinate, break down boundaries,
think outside of the box -- that requires different skills, not just technical
but business; not just business but extroverted or organizationally aggressive
in terms of opening up channels with other groups inside the company, even
helping people get out of their comfort zone.
So what do you think is the
next step when it comes to finding the needed talent and skills to create this
new digitally transformed business environment?
Curious IT benefits business
Yuen: In
order to find that skill set, you need to expand your boundaries in two ways.
One is the ability to take
your natural interest in learning and expand it. I think a lot of us,
especially in the IT industry, have been pushed to specialize in certain things
and get certifications, and you need to get as deep as possible. We have closed
our eyes to having to learn about other technologies or other items.
Most technical people, in
general, are actually fairly inquisitive. We have the latest iPhone or Android.
We are generally interested. We want to know the market because we want to make
the best decisions for ourselves.
We need to apply that
generally within our business lives and in our jobs in terms of going beyond
IT. We need to understand the different technologies out there. We don’t have
to be masters of them, we just need to understand them. If we need to do
specialization, we go ahead. But we need to take our natural curiosity --
especially in our private lives -- and expand that into our work lives and get
interested in other areas.
The second area is accepting
that you don’t have to be the expert in everything. I think that’s another
skill that a lot in business should have. We don’t want to speak up or learn if
we fear we can’t be the best or we might get corrected if we are wrong.
But we really need to go ahead
and learn those new areas that we are not expert in. We may never be experts,
but we want to get that secondary perspective. We want to understand where
finance is coming from in terms of budgetary realities. We need to learn about
how they do the budget, what the budget is, and what influences the costs.
If we want to understand the
end users’ needs, we need to learn more about what their requirements are, how an
application affects them, and how it affects their daily lives. So that when we
go to the table and they say, “I need this,” you have that base understanding
and know their role.
By having greater knowledge
and expanding it, that allows you to go ahead and learn a lot more and as you
expand from that area. You will discover areas that you might become interested
in or that your company needs. That’s where you go ahead, double-down, and take
your existing learning capabilities and go really, really deep.
A good example is if I have a
traditional IT infrastructure. Maybe I have learned virtual machines, but now I
am faced with such things as cloud virtual machines, containers, and Kubernetes, and with
serverless.
You may not be sure in what direction to go, and with analysis paralysis
-- you may not do anything.
What you should do is learn
about each of those, how it relates, and what your skills are. If one of those technologies
booms suddenly, or it becomes an important point, then you can very quickly
make a pivot and learn it -- as opposed to just isolating yourself.
So, the ability to learn and
expand the skills gap creates opportunities for everybody.
Gardner: Well,
we are not operating in a complete vacuum. The older infrastructure vendors are
looking to compete and remain viable in the new cloud era. They are trying to
bring out solutions that automate. And so are the cloud vendors.
What are you seeing from cloud
providers and the vendors as they try to ameliorate these issues? Will new
tools, capabilities, and automation help gain that holistic, strategic focus on
the people and the process?
Cloud coordinators needed
Yuen: The
providers and vendors
are delivering the tools and interfaces to do what we call automation
and orchestration. Sometimes those two terms get mixed
together, but generally I see them as separate. Automation is taking an
existing task, or a series of tasks or process, and making it into a single,
one-button-click type of thing. The best way I would describe it is almost like
an Excel macro. You have steps 1, 2, 3, and 4, I am going to go ahead and do 1,
2, 3 and 4 as a script with a single button.
But orchestration
is taking those processes and coordinating them. What if I need to have
decision points in coordination? What if I need to decide when to run this and
when not to run that? The cloud providers are delivering the APIs, entry points,
and the data feedback so you have the process information. You can only
automate based on the information coming in. We are not blindly saying we are
going to do one, two and three or A, B and C; we are going to react based on
the situation.
So we really must rely on the
cloud providers to deliver that level of information and the APIs to execute on
what we want to do.
And, meanwhile, the vendors
are creating the ability to bring all of those tools together as an information
center, or what we traditionally have called a monitoring tool. But it’s really
cloud
management where we see across all of the different clouds. We can see
all of the workloads and requirements. Then we can build out the automation and
orchestration around that.
The vendors are creating the ability to bring all of those tools together as an information center, what we traditionaly called a monitoring tool. But it's really cloud management across all of the different clouds.
Some people are concerned that
if we build a lot of automation and orchestration, that they will automate themselves
out of a job. But realistically what we have seen is with cloud and with
orchestration is that IT is getting more complex, not less complex. Different
environments, different terminologies, different way to automate, the
complexities of integrating more than just the steps that IT has – this has created
a whole new area for IT professionals to get into. Instead of deciding what
button to press and doing the task, they will automate the tests. Then we are left
to focus on determining the proper orchestration, of coordinating amongst all
the other areas.
So as the management has gone
up a level, the skills and the capabilities for the operators are also going to
go up.
Gardner: It
seems to me that this is a unique time in the long history of IT. We can now apply
those management principles and tools not just to multicloud or public cloud,
but across private cloud, legacy, bare-metal, virtualization, managed service
providers, and SaaS applications. Do you share my optimism that if you can, in
effect, adjust to cloud heterogeneity that you can encompass all of IT
heterogeneity and get comprehensive, data-driven insights and management for
your entire IT apparatus regardless of where it resides, how it operates, and
how it's even paid for?
Seeing through the clouds
Yuen:
Absolutely! I mean that’s where we are going to end up. It’s an inverse of the
mindset that we currently have in IT, which is we maintain a specific type of
infrastructure, we optimize and modify it, and then the end result is it’s
going to impact the application in a positive way, we hope.
What we are doing now is we
are inverting that thinking. We are managing applications and the applications
help deliver the proper experience. That’s what we are monitoring the most, and
it doesn’t matter what the underlying infrastructure or the systems are. It’s
not that we don’t care, we just don’t care necessarily what the systems are.
Once we care about the
application, then we look at the underlying infrastructure, and then we
optimize that. And that infrastructure could be in the public cloud, across
multiple providers, it could be in a private cloud, or a traditional backend and
large mainframe systems.
It’s not that we don’t care
about those backend systems. In fact, we care just as much as we did before –
it’s just that we don’t have to have that alignment. Our orientation isn’t
system-based or application-based. Now, there potentially could be anything -- and
the vendors with systems management software, they are extending that out.
So it doesn’t matter if it’s a
VMware
system, or a bare metal system, or a public cloud. We are just managing the end-result
relative to how those systems operate. We are going to let the tools go ahead
and make sure they execute.
Our ability to understand and
monitor is going to be critical. It’s going to allow us to extend out and
manage across all the different environments effectively. But most importantly,
it’s all affecting the application at the top. So you’re becoming a purveyor
and providing better skills to the end-users and to finance.
Gardner: While
you’re getting a better view application-by-application, you’re also getting a
better opportunity to do data analysis across all of these different
deployments. You can find ways of corralling that data and its metadata and
move the workloads into the proper storage environment that best suits your
task at the moment under the best economics of the moment.
Not only is there an application
workload benefit, but you can argue that there is an opportunity to finally get
a comprehensive view of all of the IT data and then manage that data into the
right view -- whether it’s a system of record benefit, application support
benefit or advanced analytics, and even out to the edge.
Do you share my view that the
applications revolution you are describing also is impacting how data is going
to be managed, corralled, and utilized?
Data-driven decision making
Yuen: It is,
and that data viewpoint is applicable in many ways. It’s one of the reasons why
data protection and analysis of that data becomes incredibly important. From
the positive side, we are going to get a wealth of data that we need in order
to do the optimizations.
If I want to know the best
location for my apps, I need all the information to understand that. Now that we
are getting that data in, it can be passed to machine learning (ML)
or artificial intelligence
(AI) systems that can make decisions for us going forward. Once we
train the models, they can be self-learning, self-healing, and self-operating.
That’s going to relieve a lot of work from us.
Data also impacts the end-users.
People are taking in data, and they understand that they can use it for
secondary users. It can be used for development, it can be used for sales. I
can make copies of that data, so I don’t want to touch the production data all
the time. There is so much insight I can provide to the end users. In fact, the
explosion of data is a leading cause of increased IT complexity.
We want to maximize the
information that we get out of all that data, to maximize the information the
end-users are getting out of it, and also leverage our tools to minimize the negative
impact it has for management.
Gardner: What
should enterprises be doing differently in order to recognize the opportunity,
but not fall to the wayside in terms of these culture and adoption issues?
Come together, right now, over cloud
Yuen: The
number one thing is to start talking and developing a measured, sustainable
approach to going into the cloud. Come together and have that discussion, and don’t
be afraid to have that discussion. Whether you’re ready for cloud or you’ve already
gone in and need to rein it back in. No matter what you need to do, you always
have that centralized approach because that approach is not going to be a
one-time thing. You don’t make a cloud plan and then not revisit it for 20
years -- you live it. It’s an ongoing, living, breathing thing -- and you’re
always going to be making adjustments.
But bring the team together,
develop a plan, build an approach to cloud that you’re going to be living with.
Consider how you want to make decisions and bring that together with how you
want to interact with each other. That plan is going to help build the
communication plan and build the organization to help make that cultural shift.
Companies honestly need to do
an assessment of what they have. It’s surprising that a lot of companies just
don’t know how much cloud they are using. They don’t know where it’s going. And
even if it’s not in the cloud yet, they don’t know what they need.
A lot of the work is
understanding what you have. Once you build out the plan of what you want to do,
you essentially get your house in order, understand what you have, then you
know where you want to go, where you are, and then you can begin that journey.
The biggest problem we have
right now is companies that try and do both at the same time. They move forward
without planning it out. They may potentially move forward without
understanding what they already have, and that leads to inefficiencies and
cultural conflicts, and the organizational skills gaps issues that we talked
about.
So again, lay out a plan and
understand what you have, those are the first two steps. Then look for
solutions to help you understand and capture the information about the
resources you already have and how you are using them. By pulling those things
together, you can really go forward and get the best use out of cloud.
Gardner: I’m
afraid we’ll have to leave it there. We have been exploring many different
business issues around the adoption patterns for cloud, how to avoid pitfalls,
and even start rethinking your entire organization. It seems to me that cloud
adoption is a catalyst to larger change. And we have heard why a cultural
solution might be among the most important aspects of making a successful
transition to cloud adoption.
Please join me in thanking our guest, Edwin Yuen, Senior Analyst for Cloud Services and Orchestration, Data Protection, and DevOps at ESG. [Note: Since this podcast was recorded on Nov. 15, 2018, Yuen has become principal product marketing manager at Amazon Web Services.] Thanks you so much, Edwin.
Yuen: Thank
you.
Gardner: And a
big thank you as well to our audience for joining this BriefingsDirect Voice of
the Analyst hybrid IT and cloud computing strategies interview.
I’m Dana Gardner, Principal
Analyst at Interarbor Solutions, your host for this ongoing series of Hewlett Packard
Enterprise-sponsored discussions. Thanks again for listening. Please pass this
on to your IT community, and do come back next time.
Transcript
of a discussion on how businesses struggle with cloud computing adoption, and how
they could improve by attaining a better culture directed at cloud consumption
and total productivity. Copyright Interarbor Solutions, LLC, 2005-2019. All
rights reserved.
