Harvard Business Review
You’re in a meeting. You and your team identify a great new business opportunity. If you can launch in 60 days, a rich new market segment will be open for your product or service. The action plan is developed. Everything’s a go.
And then you come down to earth. You need new computer equipment, which takes weeks, or months, to install. You also need new software, which adds more weeks or months. There’s no way to meet the timeframe required by the market opening. You are stymied by your organization’s lack of IT agility.
Or, you could have the experience the New York Times had when it needed to converta large number of digital files to a format suitable to serve up over the web. After the inevitable “it will take a lot of time and money to do this project,” one of their engineers went to the Amazon Web Services cloud, created 20 compute instances (essentially, virtual servers), uploaded the files, and converted them all over the course of one weekend.
Total cost? $240.
This example provides a sense of why cloud computing is transforming the face of IT, with the potential to deliver real business value. The rapid availability of computational resources in a cloud computing environment enables business agility — the dexterity for businesses to quickly respond to changing business conditions with IT-enabled offerings.
Notwithstanding the fact that IT seems to always have the latest, greatest thing on its mind, cloud computing has the entire IT industry excited, with companies such as IBM, Microsoft, Amazon, Google and others investing billions of dollars in this new form of computing. And in terms of IT users, Gartner recently named cloud computing as the second most important technology focus area for 2010.
But what is cloud computing exactly? Why is it different than what went before? And why should you care? While there are many definitions of cloud computing, I look to the definition of cloud computing from the National Institute of Standards and Testing (NIST), part of the US Department of Commerce. In its cloud computing definition, NIST identifies five characteristics of cloud computing, which include:
- on-demand self service, which allows business units to get the computing resources they need without having to go through IT for equipment.
- broad network access, which enables applications to be built in ways that align with how businesses operate today – mobile, multi-device, etc.
- resource pooling, which allows for pooling of computing resources to serve multiple consumers.
- rapid elasticity, which allows for quick scalability or downsizing of resources depending on demand.
- measured service, which means that business units only pay for the computational resources they use. Translation: IT costs match business success.
To offer a concrete example of how cloud computing agility enables organizations to respond to business opportunity, let me share the experience of one of our clients, the Silicon Valley Education Foundation. Its Lessonopoly application allows 13,000 teachers throughout Silicon Valley to collaborate on lesson plans. NBC approached SVEF just before this year’s Winter Olympics with science-focused lesson plans centered around the science behind the experience of Olympic athletes (e.g., the loads placed on a skier’s legs as she swerves around a slalom gate).
One concern SVEF had was whether or not Lessonopoly could handle the likely application load increase. There were only a few days before the start of the Olympics, which would initiate heavy use of these lesson plans. The group had migrated the application to Amazon Web Services a few months earlier, and they were able to quickly shut down the small machine Lessonopoly was running on and bring it back up on a larger instance with three times the computing capacity of the original.
It’s a cliché to say that business is changing at an ever-increasing pace, but one of the facts about clichés is they often contain truth. The deliberate pace of traditional IT is just not suited for today’s hectic business environment. Cloud computing’s agility is a much better match for constantly mutating business conditions. To evaluate whether your business opportunities could be well-served by leveraging the agility of cloud computing, download the HyperStratus Cloud Computing Agility Checklist, which outlines ten conditions that indicate a business case for taking advantage of the agility of cloud computing.
Bernard Golden is CEO of HyperStratus, a Silicon Valley-based cloud computing consultancy that works with clients in the US and throughout the world. Contact him at firstname.lastname@example.org