Wednesday, March 31, 2010

But It's Not About the Technology

Today the conversation on cloud computing continues having migrated slowly from definitions and scope to adoption and migration. The primary focus of IT professionals from the CIO and CTO through system administrators is cost reduction; maximizing the use of existing hardware. Secondary, in fact a very distant second whom only a few really seem to understand, is the application of cloud technologies to reduce complexity by drawing distinct lines of responsibility between the layers of the IT stack. Both goals are reasonable, even commendable, but they only breach the surface of the value of cloud computing. With Cloud, it isn't about the technology.

So what is it about? The business. As with so many other technologies that have come before we are again falling into that time honored trap of applying technology for it's own sake. Saving a few dollars here and there may sound like the interests of the business are first, but that's a very myopic point of view. Very few IT organizations have taken the time to explain cloud computing to their business leaders and engage them in the discussion. In fact I am actively looking for my first example so I can praise them, learn from them, and write about them. Stay tuned but don't expect any posts on the topic in the near future.

Cloud Computing provides a new model to loosely couple organizations providing them a dynamic, opportunity based model to share services and data. As the landscape in various industries shrinks through competition and acquisition pure head-to-head rivals fade replaced by the new model of "co-opetition". Companies today find themselves increasingly competing as well as cooperating with their partners. The concept isn't new but instead of being a rare exception it has emerged as a predominant model. How do you draw distinct lines in the sand to separate you from a competitor in one area when you want to share information and assets with the same company in another area. In the past we have created physical partitions which, by their static nature, often limited the growth of the partnership because the partitions either didn't or couldn't change easily. Workarounds become common which lead to wasted labor, inefficiencies, and increasing complexity. Cloud technologies with virutalization at the core provide the toolset required to dynamically map and remap resources. Adopt a cloud model whereby each partition becomes a cloud and the opportunities explode.

I am a firm believer the value of cloud computing lies in its ability to take collaboration further, extending our model of human-to-human cooperation between companies to our technology assets. Integrations between companies today are based on a steady state business process: accounts receivable, purchase order, shipment notification, etc. A new model will emerge, Cloud Keiretsus, whereby federations of companies will be loosely coupled with clouds providing the foundation. Data will move into, around, and out of the cloud as necessary to fulfill the objectives of the organizing principle whether it's to bring a product to market, manage a financial service offering, or develop a new drug. In this model when two or more organizations begin working together a collaboration cloud is provisioned as a foundation to facilitate the sharing of information; emails, prior work, document management, etc. As the relationship progresses and opportunities to share data emerge the cloud operates as both a repository and gateway managing the flow. New applications can be rapidly developed in the cloud to fulfill new needs and existing services can be exposed to automate processes as they cross over into the scope of the relationship.

An important advantage of this model is the ability to share and enforce standards, even when different, on both sides. Mapping the workflow of a process between organizations will enable compliance without requiring either company to abandon their own standards. Company A can map it's SDLC to that of Company B without explicit conversion. Exceptions where Company B has additional requirements can be mapped into the workflow of Company A. For example, such an approach would reduce the ramp-up time and cost of establishing the Program/Project Management Office for new projects and simplify the execution of the project.

As the world becomes smaller companies are pushed to cooperate combining resources to compete effectively. The next weakest link in the chain is the rapid integration of processes to ensure everyone involved is "singing from the same sheet of music." Cloud Computing provides a new architecture enabling collaboration between companies at the business process level. Those who see and take advantage of the opportunity first will be the best positioned to redefine their markets.