Tag Archives: Open Group survey

Counting the Cost of Cloud

By Chris Harding, The Open Group

IT costs were always a worry, but only an occasional one. Cloud computing has changed that.

Here’s how it used to be. The New System was proposed. Costs were estimated, more or less accurately, for computing resources, staff increases, maintenance contracts, consultants and outsourcing. The battle was fought, the New System was approved, the checks were signed, and everyone could forget about costs for a while and concentrate on other issues, such as making the New System actually work.

One of the essential characteristics of cloud computing is “measured service.” Resource usage is measured by the byte transmitted, the byte stored, and the millisecond of processing time. Charges are broken down by the hour, and billed by the month. This can change the way people take decisions.

“The New System is really popular. It’s being used much more than expected.”

“Hey, that’s great!”

Then, you might then have heard,

“But this means we are running out of capacity. Performance is degrading. Users are starting to complain.” 

“There’s no budget for an upgrade. The users will have to lump it.”

Now the conversation goes down a slightly different path.

“Our monthly compute costs are twice what we budgeted.”

“We can’t afford that. You must do something!”

And something will be done, either to tune the running of the system, or to pass the costs on to the users. Cloud computing is making professional day-to-day cost control of IT resource use both possible and necessary.

This starts at the planning stage. For a new cloud system, estimates should include models of how costs and revenue relate to usage. Approval is then based on an understanding of the returns on investment in likely usage scenarios. And the models form the basis of day-to-day cost control during the system’s life.

Last year’s Open Group “State of the Industry” cloud survey found that 55% of respondents thought that cloud ROI addressing business requirements in their organizations would be easy to evaluate and justify, but only 35% of respondents’ organizations had mechanisms in place to do this. Clearly, the need for cost control based on an understanding of the return was not widely appreciated in the industry at that time.

We are repeating the survey this year. It will be very interesting to see whether the picture has changed.

Participation in the survey is open until August 15. To add your experience and help improve industry understanding of the use of cloud computing, visit: http://www.surveymonkey.com/s/TheOpenGroup_2012CloudROI

Dr. Chris Harding is Director for Interoperability and SOA at The Open Group. He has been with The Open Group for more than ten years, and is currently responsible for managing and supporting its work on interoperability, including SOA and interoperability aspects of Cloud Computing. He is a member of the BCS, the IEEE and the AEA, and is a certified TOGAF practitioner.

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New Open Group Survey Aims to Understand Cloud Computing ROI and Business Drivers

By Chris Harding, The Open Group

What are the real business benefits from using the Cloud that enterprises see today?

To help answer this question, The Open Group has launched its second annual study to gather information about the evolving business requirements for Cloud Computing and examine the measurable business drivers and ROI to be gained.

We are specifically looking for input from end-user organizations about their business requirements, concerns with implementing Cloud initiatives, and tools for measuring Cloud ROI. We would greatly appreciate your insight and encourage you to spend a few minutes completing the survey: http://www.surveymonkey.com/s/TheOpenGroup_2012CloudROI

The Open Group Cloud Computing Work Group exists to create a common understanding among buyers and suppliers of how enterprises of all sizes and scales of operation can include Cloud Computing technology in a safe and secure way in their architectures to realize its significant cost, scalability and agility benefits. It includes some of the industry’s leading Cloud providers and end-user organizations, collaborating on standard models and frameworks aimed at eliminating vendor lock-in for enterprises looking to benefit from Cloud products and services. It has created a series of whitepapers, guides and standards to help business approach and implement Cloud Computing initiatives, which are available from download from The Open Group bookstore. The Open Group book, Cloud Computing for Business, gives managers reliable and independent guidance that will help to support decisions and actions.

The results of the survey will contribute to our future work and will be publicly available for the benefit of the industry as a whole.

Dr. Chris Harding is Director for Interoperability and SOA at The Open Group. He has been with The Open Group for more than ten years, and is currently responsible for managing and supporting its work on interoperability, including SOA and interoperability aspects of Cloud Computing. Before joining The Open Group, he was a consultant, and a designer and development manager of communications software. With a PhD in mathematical logic, he welcomes the current upsurge of interest in semantic technology, and the opportunity to apply logical theory to practical use. He has presented at Open Group and other conferences on a range of topics, and contributes articles to on-line journals. He is a member of the BCS, the IEEE, and the AOGEA, and is a certified TOGAF practitioner.

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