CIO Canada tearsheet: Explain the cloud to your boss

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Cloud Computing
Definition: The “cloud” refers to the Internet. Instead of owning and operating all the computers and servers you need to run a business, a company can work with an outside firm to use computers in their offices and simply run all the software programs remotely through the Internet. These are often called “public clouds” because your company’s information and IT resources are technically going outside of your complete control and into the hands of a third party. Some organizations are setting up what they call “private clouds” by using software that makes one computer act like multiple machines and putting information online, but in a way that only they can control.

Business Case: As companies grow, they often need to buy, set up and maintain more and more computers and servers to keep up with the needs of employees and departments. Cloud computing allows them the opportunity to meet those needs without necessarily adding machines or personnel. Instead, working with a company that sets up public clouds would mean you’re charged a subscription fee to add or decrease the amount of computing power you need, sort of like the way the electricity company lets you turn up the thermostat rather than forcing you to set up your own mini power plant every time it gets cold. This can be a way of essentially outsourcing some of the work that IT departments need to do today.

Risks: Many companies have worried about whether their information will be secure enough when it’s running through the Internet via another firm. There have been concerns, particularly in Canada, that the companies providing cloud computing services have not been in business long enough to be credible or that they are prepared to meet the needs of a large organization. For public sector and even some private firms, there are privacy concerns and regulatory barriers to dealing with cloud vendors based in the United States. The contracts involved in the pay-as-you-go model of cloud computing can also be complex and require sophisticated negotiating from companies that don’t want to be locked in with a poorly-performing supplier.

Ecosystem: The potential benefits of cloud computing have nearly every technology vendor announcing services to provide it, new products that make it easier to set up and manage or changes to their existing services. Major consulting organizations have revamped their programs to help guide firms through the process of moving into the cloud. It is probably safe to say that there are multiple conferences every month in Canada that focus on cloud computing to provide IT professionals the chance to share concerns and brainstorm best practices. There are also a number of case studies, published in CIO Canada magazine and elsewhere, of organizations who have been successful with this model and who are willing to discuss their challenges and lessons learned.

Metrics: The money saved from buying less IT infrastructure and the overall personnel and associated operating costs of running your own servers may be offset by the costs involved in mitigating cloud computing’s many security risks. This includes having a third-party security assessment done on a potential cloud computing provider. Some firms have chosen to measure improvements in how often computers and software resources are running smoothly without the need to call the IT department for help. Some feel they are better able to track how much they are actually using software and computer resources, which assists their ability to plan for the future. Or, the bottom line may be simply how well the IT department is able to meet business needs, or, having outsourced some of the work around setting up and managing IT equipment, how much time they have to work on more creative projects that help the overall business succeed.



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