Answer

The Return on Investment of a Cloud Deployment

Abstract

Net Experts is an innovative internet based company with millions of customers worldwide seeking to replace its traditional on-campus IT datacenter based infrastructure to a cloud-based infrastructure. The company’s main problems are the rising fixed and running costs of keeping and maintaining their traditional in-house infrastructure and the need to replace it with a solution that provides the same power and flexibility like the traditional systems, but with much less cost. To achieve this goal, public IAAS based cloud service, a cloud based solution, is proposed as this would ensure great flexibility and reduction in costs and human capital. Key performance indicators are also defined to ensure quality in all aspects of business functions and efficient optimization process.

The Return on Investment of a Cloud Deployment

Introduction

Traditionally, most IT companies have been supporting their IT and network infrastructure needs by developing in house datacenters supported by the internet.  While this worked very well for such companies, associated costs have been very high. The technology landscape is dynamic as new and disruptive technology keeps emerging from time to time, serving as an advantage for tech savvy organizations. In the recent times, a new technology has been changing how organizations treat their IT resources and business workflows, and this technology is called Cloud Computing. Cloud computing technology in particular has changed the way that organizations treat their IT resources and business workflows. Cloud computing involves provisioning of scalable and virtualized resources in the run time over the internet as a service. It covers any subscription-type or pay as you use service provided in real time over the Internet, and extending an organization’s existing capabilities.

This paper discusses a shift from traditional on premise datacenter infrastructure to cloud solution for a leading internet based company (Net Experts) with millions of customers worldwide, seeking to enhance the experience of their customers and reduce costs and infrastructure overheads.

Further, the paper discusses the company’s present IT infrastructure situation and proposes a solution to counter this problem and provides the rationale for the solution and its feasibility. Since the proposed solution is cloud based, different environment and models involved in the deployment process are also discussed.

Every project planning and implementation requires specific resources and, therefore, resources for implementing the cloud based solution are also discussed in great detail in this paper. Operation and performance monitoring is also a key aspect in cloud based IT infrastructure and to achieve this goal, solid operations and performance evaluation procedures must be developed. This is done in the form of the key performance indicators (KPIs) which are quality parameters that measure performance of loud based solutions in various areas like business impact, marketing, customer growth, latency, availability and security. Each of these parameters is discussed.  Finally, a graphical illustration is presented to discuss the actual underlying architecture and scheme of the cloud solution (Iyer & Henderson, 2010).

Cloud Technology Deployment

Net Experts is an innovative internet based company with a presence in over seven continents and millions of users worldwide. The company uses a private data and IT infrastructure but due to rising costs of maintaining and keeping a private infrastructure up to date, the company needs to find a replacement for their current infrastructure with a  more efficient and cost effective one.

To alleviate this need, cloud technology promises to be the best solution. Cloud computing involves provisioning dynamically scalable and virtualized resources over the internet as a service. It encompasses any subscription-based or pay-per-use service that in real time over the internet and extends its existing capabilities. This could be offered as Infrastructure or Platform, or Software as a service.

For the current needs of the company, a high functioning public cloud technology is the best choice because apart from cutting down or the company’s IT associated costs, it provides latest advancements in communications and internet technologies.  Moreover, the technology is considered as secure as a private cloud, making it the best choice of a cloud environment for the company (ArcView, 2009).

Net Experts is a multidimensional company with diverse organizational functions and processes requiring suitable resource and software suites that streamline and make the processes effective and efficient. Therefore, the software as a service environment is the cloud environment that will be best suited to the company’s needs since it is a public cloud with private and secure functional software running on a private space (J Becker, 2000).

There are many excellent solution providers that are providing state of the art cloud softer as a service services. However, one solution stands out is Oracle’s Cloud platform since it provides robust, secure and flexible software as a service solution. Oracle Cloud is considered the industry’s most integrated and broad public cloud. One of the primary benefits for choosing Oracle Cloud is its ability to help companies to reduce IT costs and operational complexity (J Becker, 2000).  Software as a Service (SaaS) is one of the cloud solutions from Oracle that will be selected for Net Experts Company. This cloud platform is employed in transforming the business, functional processes, and work and data flows. SaaS applications provide companies with an innovation and state of the art cloud software in a cloud suite which is fast, efficient, and safe.

There are multiple advantages that selecting the oracle cloud over other solution providers will give the company. Oracle is one of the oldest providers of cloud computing services in the market. Therefore, it guarantees that cloud best-practices and state of the art server systems are deployed. Oracle also provides built-in analytic, mobile and social media feature. In this manner, Net Experts will be able to deliver efficiency and speed expected by customers, while enjoying cost advantages for success and performance demanded by the market. Oracle’s cloud solutions are more complete, integrated, and advanced than those from any other solution provider in the world. Oracle’s software as a service application can run in the cloud, on premise, or in combination. This, therefore, provides an extra advantage and flexibility in functionality can be added in future. Additionally, some parts of the cloud infrastructure can be deployed on premises which will result in a hybrid cloud (Marston, n.d). After the solution provider selection, it is important to analyze the resources required for the deployment.

It is essential for Net Experts to understand secure appropriate resources required for their cloud system. Moreover, both the company and the service providers require an efficient creation and arrangement of cloud administrations for establishment of their IT operations to avoid restarting and redeployments. .There is thus a need for efficient system architects that can plan and implement the cloud deployment (Subashini & Kavitha, 2011).

The planning includes considering the number of users and devices that will use the system now and the number of user and workstations that the system will be serving five years later. It also includes the hardware and network infrastructure that is suitable for running and relaying the company’s software suits. All these requirements need to be communicated clearly to the solutions provider (Subashini & Kavitha, 2011).

To deploy the functionality of cloud computing, it is vital that planners and implementers have a simple tool for monitoring and evaluating the system’s performance, KPIs, and offered services. Offered services quantify set of services and apps that end users can consume through the provider. It is also a requirement that the offered services include resource guarantees, uninterrupted services and efficiency. It is also required that the company hires resources that can periodically evaluate the network performance and constantly report to the management about the system’s performance. When the network is deployed and running, it becomes vital to measure the performance and benefits of the cloud deployment in a quantitative way (J Becker, 2000).

The set of parameters against which the cloud network will be measured are called KPIs. These are the attributes and qualities of the clod network through which the quality of the cloud based solution will be measured.

Cost saving with cloud deployment is one of the most important key performance indicators for the company. It shows how much annual fixed and running cost is saved by shifting to cloud based solution and getting rid of the traditional, on premise network infrastructure (ArcView, 2009).

The cost parameter can further be divided into capital costs saving, operational cost casings and predictable workload cost savings. The capital cost is a onetime deployment cost of the whole cloud based solution and it will be compared with the fixed cost of installing private datacenter based IT infrastructure. Operational expenditure or OPEX is the running cost of the cloud solution that will be measured along a fiscal period. This can be monthly recurring cost, quarterly recurring cost, half yearly recurring costs, or yearly recurring costs. The predictable workload is the amount of traffic the cloud solution will handle at a certain time or the number of data transaction requests that the system will be serving at any given time. This is calculated during the planning phase of the cloud deployment and the system’s capacity is designed according to this parameter. There are also costs associate with the predictable workload parameter that is determined by measuring the amount of power, network resource and computing resource spent in serving a request. This is also an important aspect of the KPI and should be measured vigilantly to measure the system’s quality.

The second important key performance indicator is the time taken to deploy the whole solution. Since the company does not have to plan and implement the whole infrastructure and software, it is obvious that the clod solution deployment is going to take less time than a dedicated private network infrastructure. Another important KPI is the availability of the cloud solution. It has to be available 99.99 percent of the time and must have extremely efficient business continuity plans and disaster recovery and management plans. It must also not be susceptible to power failures or network failures or disk and computing failures. The availability ration will be compared with the on premise network solution (ArcView, 2009).

On the software front, the most important key performance indicator is the intelligent task and workflow automation built into the system. This is how efficiently and rapidly the system handles complex processes. This of course depends greatly on the deployment strategy and expertise of the solution provider, and as the company ensures that the solution provider is one of the best, it must be duly measured and analyzed.

The ultimate purpose of cloud deployment for Net Experts was to be a smart service provider and deliver better services to their customers while keeping costs and failures to a minimum. Therefore, an important key performance parameter is customer growth. This is one of the most direct determinants of whether the cloud solution has improved the company’s processes. Monthly figures provided by the company’s sales teams must, therefore, be looked closely. It should also be noted whether they are still bringing in new customers and whether the numbers are higher or equal to what was observed the previous month. Increased numbers should not stop the company from optimizing the software suits tuning on the cloud and if the numbers are decreasing or low, the company must investigate the root causes of the decline, whether it is the hardware that is lacking or the software is unable to cope with the customers’ demands so as to come up with an optimization solution. All key stakeholders including the service provider must be involved in the process (Iyer & Henderson, 2010).

The average revenue per user (ARPU) is another important quality measuring parameter in this regard. ARPU is earned from all the users and calculated by dividing the total revenue by total number of customers. A good cloud strategy must help the company to achieve increased ARPU of at least 15-20 per cent. To achieve the above mentioned KPIs, the solution provider must deliver state of the art cloud architecture (Becker, 2000).

Figure 1 in the appendix illustrates a visual representation of the company’s chosen cloud architecture and it is evident that the whole infrastructure consists of state of the art architecture schemes. The computational component or the datacenters and the servers are power with storage, network and bandwidth upon which the virtualization takes place and multiple virtual machines are created according to the user’s demand. On every virtual machine, relevant software is run according to the functional role the client is performing on them (Iyer & Henderson, 2010).

In conclusion, for an innovative internet based company like this, exceptional user experience and great customer service is extremely important.  Given the rapidly mounting costs of keeping and maintaining private and company owned datacenters, cloud technology becomes the best alternative since it is a very affordable and time and cost saving solution. It also has the ability to provide security and privacy of a private infrastructure and flexibility to scale the hardware and software according to the organization’s needs.