Be inside, kicking out...

Looking back through the years,

I remember quite distinctly spotting some developing trends that caused me to “re-tool” and shift where the market was pointing. Some, just in time. For instance, telecommunications was not the most secure place to be after the late 80's, so I retooled into Data Communications. I also distinctly remember when those PC and Novell outlanders came out of nuisance status and started replacing big iron mainframes. 

Then we spotted the “internet” at the Super Collider and created my ISP as a full service ISDN offering (it “was” high speed). I'm not suggesting I'm brilliant, as a matter of fact probably most of us in these fields could see these things coming, you just had to be really stubborn to ignore them. If you did ignore them, well...

Now we have another train that’s long left the station, “cloud”. Actually my ISP company started selling thin-client (early days SaaS) service via internet in the late 90’s. We may have been a bit early in the market, but the train is now freight train status, largely due to big bandwidths enabling web clients access to native applications without the trouble of thin client..

I wouldn't look at cloud as a career though, not in and of itself. I'd look at is as an enabler of whatever you feel your secret sauce is. In my case I love business process improvement. Helping organizations streamline time to market and slash processes that don't fit. The modern interpretation to this is "reducing technical debt". Well, business process improvement is not new, but the optimal solution set is much easier than it used to be with XaaS (my new word, X being just about any service as a lease).

Still, apparently the word is not completely out with cloud. Recently I saw an article with a title that included “cloud is here to stay”.  I had to double-check the date to be sure it wasn’t 5 years earlier, but nope. Some are still viewing cloud as one viable option. On the contrary, it’s difficult to see any company not using SaaS or PaaS for most applications within 5 years. The ROI is too strong. Not only in cash flow but also the impact on CapEx and limberness (elasticity is the current word).

So being in the industry we have to continue to re-tool, learn all we can, test the boundaries, take risks, and… something different… actually learn how to think like the CFO, or even the CEO. Technology decisions should principally revolve around opportunity, elasticity, and cash-flow. No, I didn’t mention governance and security because we’ve probably already passed the point where it’s now easier to secure using XaaS. All this to say, make the future your best friend and conquer your own horizon.

To close on a fun note, and speaking of prophesying, I bet you’ve already thought the following question will oft be asked in 10 years’ time: “Can you believe they actually let people steer these cars back then?”   Or even… “Daddy/Mommy why are there so many empty lanes on the highway”?   “Well dear, people used to drive to work…” Let's take it further then. If that does comes to pass, what do you think we'll do with all those extra roads and highways? Could be fun.

 (Patrick Bouldin is the President & CEO of Run This Project, specializing in cloud computing strategy and Business Process Improvement.)

The inevitable CEO – CIO Conversation?

The past conversations have been tense enough: 

CEO  : Jack, what are we doing about the cloud? 

CIO  : Al, it’s ok, the cloud is insecure, no governance and we’d be at the mercy of someone else... but don’t worry, we moved our email and our on-boarding app to it and sort of checking it all out…

Tomorrow's conversation: 

CEO : Jack, I know our company has been a profit mecca for 25 years, but the guys at the CEO lunch told me we have to have a “cloud migration strategy" or we’ll get undercut by competitors that don’t even exist right now. Plus, I'm told our valued I.T. staff can get certified in these services. I hear there's even an art to juggling different cloud providers and optimizing the service costs.

Ok, both conversations are accurate based on the time they occur. Times have changed, and the train has long left the station. Cloud providers actually offer the governance specs you’re looking for, for the most part. And yes, guys and gals are spinning up companies like spinning up cotton candy because it’s so cheap to do now. Your company’s “secret sauce” is what made it successful for the last two decades, but nowadays it’s no longer secret. Your market share can be assured by providing top quality, but all things being equal you’ll have to produce your product at a cost on par with new competitors. Besides, you’ve been frustrated at time to market, and I.T. technical debt has been limiting company growth for years.

The answer is to migrate the expenses that you can to the cloud, where it makes sense. But what “makes sense”? Those factors should drive your cloud migration strategy. If your company has custom code that runs on an old OS that’s not offered in the cloud then your plan has to also include migrating the OS. Worried? You shouldn’t be, you knew you’d have to do it anyway.

Check out this table, I know it’s busy, just cast your eyes on the three arrows.

The graphic is showing you the ideal situation – conventional data center expenses rolling off over time and cloud expenses going up. Yet, the THIRD red arrow is the most important, the total is less than ever, and the Sparkline trend shows dramatic downward trending! Is it overstated? Not if you plan it out well.

Guess THE most important factor? Is it the execution and migration? Nope. Is it the limberness and scalability improvement? Nope. THE most important factor of success in cloud migration is proving to the CEO (via the CFO) that your net expense trend is going down! But, your plan must have a well-organized process to retire services – and while tempting, it simply can’t be somebody’s part time side job.

That’s a risky proposition – but success can be assured if, and only if, your migration plan has someone ensuring that you’re killing off leases, reducing power and cooling consumption, consolidating data storage and redeploying assets to other areas.

The migration plan itself is yet another subject and involves a deep dive on each application. Not all apps are created equal, have the same risk or have the same importance or the same priority. So, the plan will be multi-faceted. Apps that can’t move today, apps that must move soon and apps that might make more sense staying in-house. Approach this with the old 80/20 rule and you’re the hero in the next annual report.

(Patrick Bouldin is the President & CEO of Run This Project, specializing in cloud computing strategy and Business Process Improvement.)

Businesses Must Care About Cloud

Businesses Must Care About Cloud

Elasticity is THE key advantage in using cloud services. Traditionally with Information Technology spending, actual demand is either less, or greater than capacity. If I.T. has built out capacity too far ahead of demand, it may result in good service, but the cost is not so pleasing to those concerned with earnings.  Conversely, if I.T. is short on capacity nobody in the company is happy. To understand the true gravity of the opportunity or threat that cloud has on legacy business, let’s start with this:

“Constraints, in general, are likely the single biggest factor why a profitable legacy company can fail in this millennium.”

Of course one could make the argument that this has always been the case. The difference is that because of the tools available to entrepreneurs now, you have very little time to respond to competitive attacks. The legacy companies usually were birthed because of some secret sauce. After they became huge and established the sauce wasn’t secret anymore. However, competition was easily held at bay due to the bigger company’s ability to survive a price war or some other predatory tactic.

There have been books and books written on this subject. My favorite is Judo Strategy: Turning Your Competitors' Strength to Your Advantage, by David B. Yoffie. This book was written well before the term “cloud” was coined. While the practice of Judo is ancient, the fundamental point will never change – and the point is in the title itself. Suffice it to say that if an entrepreneur can figure out a way to deliver some small component of a product to a customer cheaper, better and faster, then he may be able to drive a splinter in that market and thrive. Why? Because the big company’s processes are too fat, too slow and too invested to react quickly enough to head off Mr. Small Potatoes. See the Judo reference?

Cloud is a tool that entrepreneurs will use to strike it rich from here on out, and this will continue to erode legacy market share. However if you’re a legacy company take heart, everyone can play and win at this game.

Watch out though, because cloud is just a tool and you could easily buy the wrong brand, spend too much, fail to measure, implement it incorrectly or fail to establish a timeline. With so much to lose or so much to gain, I can’t think of a single legacy business in this country that shouldn’t be evaluating cloud services in some way and at this very moment.

(Patrick Bouldin is the President & CEO of RunThis Project, specializing in Cloud computing and Business Process Improvement.)

Why Businesses Must Care About Cloud!

Elasticity is THE key advantage in using cloud services. Traditionally with Information Technology spending, actual demand is either less, or greater than capacity. If I.T. has built out capacity too far ahead of demand, it may result in good service, but the cost is not so pleasing to those concerned with earnings.  Conversely, if I.T. is short on capacity nobody in the company is happy. To understand the true gravity of the opportunity or threat that cloud has on legacy business, let’s start with this:

“Constraints, in general, are likely the single biggest factor why a profitable legacy company can fail in this millennium.”

Of course one could make the argument that this has always been the case. The difference is that because of the tools available to entrepreneurs now, you have very little time to respond to competitive attacks. The legacy companies usually were birthed because of some secret sauce. After they became huge and established the sauce wasn’t secret anymore. However, competition was easily held at bay due to the bigger company’s ability to survive a price war or some other predatory tactic.

There have been books and books written on this subject. My favorite is Judo Strategy: Turning Your Competitors' Strength to Your Advantage, by David B. Yoffie. This book was written well before the term “cloud” was coined. While the practice of Judo is ancient, the fundamental point will never change – and the point is in the title itself. Suffice it to say that if an entrepreneur can figure out a way to deliver some small component of a product to a customer cheaper, better and faster, then he may be able to drive a splinter in that market and thrive. Why? Because the big company’s processes are too fat, too slow and too invested to react quickly enough to head off Mr. Small Potatoes. See the Judo reference?

Cloud is a tool that entrepreneurs will use to strike it rich from here on out, and this will continue to erode legacy market share. However if you’re a legacy company take heart, everyone can play and win at this game.

Watch out though, because cloud is just a tool and you could easily buy the wrong brand, spend too much, fail to measure, implement it incorrectly or fail to establish a timeline. With so much to lose or so much to gain, I can’t think of a single legacy business in this country that shouldn’t be evaluating cloud services in some way and at this very moment.

(Patrick Bouldin is the President & CEO of RunThis Project, specializing in cloud computing strategy and Business Process Improvement.)