Enabling Business Transformation with Cloud Computing

Enabling Business Transformation with Cloud Computing W H ITE PA P E R

Enabling Business Transformation with Cloud Computing

Table of Contents Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 What’s Driving Enterprises to Think “Cloud-First”? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Cloud Mix: Private, Public, and Hybrid. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Hybrid Cloud Capabilities Offer the Best of Both Worlds. . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Hybrid Cloud Consumption Models . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

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Introduction The explosion of data, mobile devices, and the consumerization of IT have placed unprecedented pressure on IT resources. The cloud is no longer optional, it’s a necessary component in delivering the agility and enabling the innovation required to remain competitive in today’s market. Many IT discussions focus on cost controls of cloud computing rather than the greater potential benefit— business agility. IT leaders are more likely to ask “How much capital and operational expense can I cut with cloud?” than “How will cloud improve revenue or my company’s competitiveness?” Yet business decision makers want IT to help them drive innovation and accelerate past competitors. Forward-thinking CIOs are embracing cloud computing as a strategic weapon—not just for IT but ultimately to enable business transformation itself. Game-changing CIOs think business transformation first, then how technology enables it. They are the ones strategizing with their CEOs and other business leaders. They look beyond simple cost calculations to the business agility that cloud computing enables. They are leading the discussions on how to build a “cloud-first” enterprise that takes maximum advantage of the efficiencies and economies of cloud computing; how to determine whether an all-cloud, partial-cloud, or no-cloud strategy is best for the business; how to choose the right combination of cloud services to support short- and long-term IT and business strategies; and how to optimize cloud computing to support business efforts related to mobile applications, Internet of Things (IoT) initiatives, business continuity, e-commerce, or business process innovation. This paper discusses IT and business challenges cloud computing can help address, why public cloud with hybrid cloud capabilities is emerging as the preferred model, and case studies for success. IT is looking to cloud computing as a way to build a new partnership with business stakeholders based on the ability to deliver innovation and business value.

What’s Driving Enterprises to Think “Cloud-First”? Server virtualization was the start of a journey toward a more streamlined, nimble approach to delivering IT services. By extending the core concepts of abstracting, pooling, and automating to the entire fabric of the data center, organizations are achieving greater efficiency, flexibility, and scale. This is the core promise of the Software-Defined Data Center, an architecture that provides the foundation for cloud-based service delivery and removes unnecessary cost and operational friction that can inhibit business agility and value. Cloud computing services can certainly be useful in addressing many core IT issues, but what prompts an enterprise to think “cloud-first” and what does that mean? A “cloud-first” mentality simply means considering cloud service options before building new infrastructure or implementing other internal “do it yourself” alternatives. We’ve ranked the top five reasons IT organizations are discovering that taking a cloud-first approach helps solve IT issues and business challenges.

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• Speed: IT organizations are pressured to deliver what the business needs in a timeframe that allows the organization to capitalize on an opportunity or gain a competitive advantage. Cloud services give IT the ability to expand capacity and implement business initiatives much faster than extending the existing data center. Simply put, it’s far faster to extend (or provision) cloud infrastructure, on demand, than to rack and stack new servers—and it’s less expensive than paying all the associated costs of running and maintaining an in-house infrastructure. Cloud computing enables faster time-to-market, which is a driver for public cloud deployment for 50 percent of businesses.1 • Scale: To meet business demand, IT is often faced with the need to expand rapidly and economically, two things that don’t always go hand in hand. Cloud computing enables the IT organization to scale infrastructure and meet uncontrolled and unpredictable spikes in demand more cost-effectively. It’s easier, faster, and less expensive to expand and support local geographies compared with building, deploying and supporting new data centers. The cloud enables scalability to meet application requirements. • Process Innovation: IT has an opportunity to identify core processes for automation, including the provisioning and deployment of standard services across clouds and new service development and release processes. Automation enables IT teams to retire many of the slow, error-prone manual processes and controls prevalent in their organizations. Cloud provides IT with the ability to expand on policy-based management and automation practices initiated in virtualized environments, extending these models across to the cloud. IT teams can more effectively manage operating expenses while creating strategic plans for reinvesting freed up resources to fuel innovation. As a result, IT can become partners in the business, leveraging their skills and expertise to make the business more innovative to drive business growth. • Data: The demand for deeper understanding, analysis, and insight is increasing computing and storage consumption. The Big Data technology and services market represents a fast-growing multibillion-dollar worldwide opportunity. A recent IDC forecast shows that the Big Data technology and services market will grow at a 26.4% compound annual growth rate to $41.5 billion through 2018, or about six times the growth rate of the overall information technology market. 2 While virtually all companies are already collecting, storing, and analyzing data, most are doing it in an ad-hoc way, creating siloes of data and insights that are of limited value to the enterprise. With the cloud model, data and insights from analytics can be shared, so business decisions and processes can be optimized and continuously improved. In addition, the cloud provides an extremely cost-effective way to scale storage resources and compute power for analyzing large data sets. • Mobility: Mobility has forever changed the equation for forecasting service demand. According to Morgan Stanley, 75 billion devices will be connected to the Internet by 2020—which means the number of mobile endpoints that trigger consumption of data, compute, and storage resources makes it impossible to keep up with demand using the traditional “build it” data center model. The advent of mobile applications has made users more demanding when it comes to performance. Employees and customers expect 24/7 access to Web and mission-critical applications. In fact, research shows that 49% of users expect a mobile application to respond in two seconds or less, 53% uninstall the app if it fails to respond, and only 16% still use an app that runs slowly. 3 On the other hand, a mobile application that rates highly with users can explode in popularity, forcing IT to scramble to provide the infrastructure needed to support it. In the mobile environment, using cloud-based services is a flexible, effective way to support this demand.

1. Source: IDG Research Services, May 2015 2. Source: IDC 3. Dimensional Research, “Mobile App Use and Abandonment,” January 2015

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CASE STUDY: CARISBROOKE SHIPPING Carisbrooke Shipping is a worldwide shipping organization based in England with a fleet of 60 cargo vessels. CHALLENGE Carisbrooke wanted to go beyond the limitations of physical infrastructure; it also needed to unify the IT estate across its UK, Germany and Holland. SOLUTION Carisbrooke utilized the vCloud Air platform to boost the reliability and performance of Microsoft Exchange. RESULTS Carisbrooke now has the unified IT estate it was looking for. The team in the UK manages everything across its international offices, through one VPN connection. Provisioning new infrastructure has become a much simpler process—they can now spin up any additional IT resource at the push of a button.

“vCloud Air was the immediate answer to our issues… You can just link the public cloud to your own data center, as an extension to the existing infrastructure and network.” —— Daniel Lewandowski, IT Manager, Carisbrooke Shipping Ltd.

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Cloud Mix: Private, Public, and Hybrid Cloud adoption plans can quickly be derailed or delayed by misconceptions about cloud types and the trade-offs among them. Private clouds, public clouds, hybrid clouds—the meaning of each term has been pushed and pulled by vendors to suit their own agendas and product offerings. The result is considerable confusion over what each term truly means and where it fits in a cloud adoption strategy. What are the various cloud types, and how do you decide when to use which? We’ve summarized three basic categories: • Private cloud is infrastructure dedicated to only one organization. In many cases it is built by an enterprise, hosted on-site at that enterprise, and run by enterprise staff. In other cases it could be built, operated, and managed by a third-party service provider. Private cloud usually offers stronger security than public cloud and keeps control tightly in the hands of the enterprise or trusted provider. • Public cloud refers to infrastructure and services that are available for use by anyone who has a network connection and can pay the price of the service. The public cloud is often less expensive and more scalable but may be less secure than a dedicated private cloud onsite. In many cases there is no common governance model or security architecture, leaving IT in the dark about how to ensure compliance with corporate and governmental regulations. However, public cloud adoption continues to grow rapidly. Globally, 16% of IT budget is now dedicated to public cloud services, a figure expected to double in the next two years, according to an IDG survey.4

4. IDG Research Services, May 2015

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• Hybrid cloud is not truly a separate cloud “type;” it is an environment that employs both private cloud and public cloud resources. A more accurate description would be “public cloud with hybrid capabilities.” It’s a way to reap the benefits of public cloud without giving up the advantages of private cloud. For example, a company could host its e-commerce website on a public cloud and do the related transaction processing and other financial activities in a private cloud. Part of the appeal of the hybrid cloud model is the ability to optimize the balance between public and private cloud resources. Through 2020, the most common use of cloud services will be a hybrid model combining on-premises and external cloud services. 5

Hybrid Cloud Capabilities Offer the Best of Both Worlds Many cloud providers define hybridity as nothing more than virtual machine migration and a VPN connection between on and offsite locations. Hybridity, as delivered by VMware, is the deployment of a common set of applications, tools, and services across a hybrid multi-cloud environment. VMware vCloud® Air™ is a secure public cloud service built on the trusted foundation of VMware vSphere® that leverages a consistent network and security model, seamless access to data across environments, and unified management that allows organizations to extend the same skills, processes, and workflows they have already invested in with their existing vSphere data center to the cloud. The service supports existing vSphere workloads and third-party applications as well as new application development, giving IT a common platform to seamlessly extend their data center into the public cloud while remaining in control of IT resources.

When evaluating cloud providers, look for these hybrid cloud capabilities to achieve maximum value of leveraging on-premises and off-premises resources: • Elastic Consumption Model • Common Management • Seamless Networking • Common Authentication • Common Governance, Billing • Common Security Model

5. Gartner, “Cloud Computing Innovation Key Initiative Overview,” April 24, 2014

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CASE STUDY: NEVRO Nevro is a medical device manufacturer headquartered in Menlo Park, California. The company is developing technology that delivers high-frequency spinal cord stimulation for pain relief. CHALLENGE A “two-company” culture impeded data integration; regulatory requirements demanded privacy; and IT personnel needed control, scalability and performance. SOLUTION Nevro harnessed vCloud Air to increase the speed and ease of deployment, ease of integration with existing solutions, and scalability for future growth. RESULTS Seamless, instant access to the cloud; 25X faster uploads with WAN optimization; scalability for future growth.

“ vCloud Air performance has been so overwhelmingly good, the integration into our existing platform has been surprisingly simple, and the people are so helpful, it’s hard to imagine a better vendor experience.” —— Jeff Wilson IT Director, Nevro Corporation

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Hybrid Cloud Consumption Models VMware has identified two broad consumption models for hybrid cloud. One is an “inside-out” consumption model, where organizations extend their existing client/server applications, such as Oracle, SAP, or Microsoft, to the cloud. This is most often done to free up capacity, address geographic latency, cover seasonality or shortterm spikes in capacity, or to support simple, cost-effective disaster recovery. This extension of the data center to the cloud covers both existing enterprise applications as well as the modernization of enterprise applications to deliver new capabilities like cloud scalability, Web and mobile consumption models, and more flexible serviceoriented architectures. This inside-out model is typically IT-driven, and a hybrid cloud can quickly and easily provide the scalable capacity necessary to meet the demands of the business. The other consumption model is an “outside-in” use case, where companies are developing new “cloud-native” applications, such as mobile apps or big data apps, that are developed in and for the cloud, leveraging next generation application development tools and application architectures. Although “born in the cloud,” these next generation applications are still very much hybrid in nature, with dependencies on systems of record, including data, applications, and authentication services that continue to operate within the on-premises data center. This outside-in use case leverages a converged operation where the development, performance, and scalability of the next generation application is best served by a cloud service, but requires seamless operational integration with on-premises applications and data in the existing data center. When combined with the benefits of an existing vSphere data center and the agility of vCloud Air, organizations have a true hybrid cloud that is scalable, portable, and agile enough to meet growing business needs.

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On-premises Data Centers

vCloud Air Data Centers vCloud Plug-in Outside-In Consumption Cloud-Native Applications

IT

DevOps

Existing Applications, Disaster Recovery Inside-Out Consumption

Management

Figure 1. Hybrid cloud consumption models

CASE STUDY: SAIC Science Applications International Corporation (SAIC), based in McLean, Virginia, provides information technology, system integration, and e-business solutions worldwide. CHALLENGE SAIC needed a rapid development platform to stay competitive. Customers required a more flexible, secure development and IaaS platform, and the global workforce needed centralized access to key data and systems. SOLUTION vCloud Air provides SAIC with a flexible, secure development platform to deliver unique solutions more cost-effectively. RESULTS New capabilities can now be delivered to the R&D team in minutes rather than weeks or months. Data migration is seamless to and from the cloud, streamlining day-to-day processes. The ability to automate network administration tasks saves time and reduces costly errors; and the increased platform speed and flexibility enable SAIC to deliver unique solutions more cost-effectively.

“Now we can respond rapidly to customer requests, and we can create unique, differentiated solutions more cost-effectively.” —— Coby Holloway, Vice President, SAIC

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Summary Enterprises are looking to cloud computing to deliver new business value and competitive advantages—and to enable IT to become a strategic partner to the business. Public cloud with hybrid capabilities is emerging as the cloud model that provides the best of both worlds: external consumption on demand that is fully compatible with existing onsite vSphere data centers. This approach solves the need of IT operations to maintain security, consistency, and governance across the data center to the cloud while lines of business and developers gain on-demand, self-service access to the IT resources they need. VMware believes that a hybrid cloud approach provides the best platform for meeting the needs of IT and the business without compromise.

Learn more about the hybrid cloud capabilities of vCloud Air by visiting vcloud.vmware.com.

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