Enterprise Cloud Adoption: Key Trends and Considerations

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1 02: 2017: The Year Of The Enterprise Cloud 03: The Cloud Is The New Business Operating Model 05: Keeping It In The Clouds Enterprise Cloud Adoption: Key Trends and Considerations

2 : The Year Of The Enterprise Cloud Enterprise IT investments and transformation in the cloud will accelerate in the next 12 months. According to IDC, enterprise spending on public cloud services in the Asia Pacific region excluding Japan will grow to 22.9% almost six times the rate of overall IT spending from nearly US$7 billion in 2015 to US$15 billion in This is faster than the forecasted rate for worldwide cloud services spending at 19.4% 1. Looking ahead, analysts offered the following insights: 1. Private Cloud Hyperconvergence Hyperconverged systems a softwaredriven platform to drive scaling and new services will be the fastestgrowing segment for integrated systems globally, reaching almost $5 billion by 2019, according to Gartner s Prepare for the Next Phase of Hyperconvergence report 2. Private Cloud Hyperconvergence adoption will accelerate with savings from lower support and maintenance costs. From a Capex perspective, hardware investments will become neutral but hyperconvergence requires advanced virtualisation, standardisation, automation, self-service access and resource monitoring. Stitching these capabilities together into a cohesive system is daunting and expensive. 2. Cloud Spend Capabilities In Demand According to the Forrester report, IT executives will get better at containing cloud costs in 2017 as their best practices mature 3. An experienced cloud architect in a large enterprise could save as much as 10-15% of their cloud consumption by monitoring usage. There are many cloud cost management tools available; there s no What To Expect In Hyperconvergence will drive cloud platform for more scalability, services and savings 2. Cloud spend management will make the cloud cost effective 3. Enterprise apps in the public cloud will be commonplace 4. IaaS and SaaS will drive greater hybrid and public cloud adoption 5. Cloud interoperability will see more SDN adoption 6. Massive PaaS cloud growth because of IoT 7. Data analytics will see more use of cloud reason to stay away from the cloud any longer because of runaway costs. 3. Enterprise Apps Come To Public Cloud In 2016, several software vendors including SAP and Splunk offered hosted, enterprise-grade applications in AWS. As CIOs become more comfortable hosting critical software in the public cloud, Forrester expects this trend to continue through Public And Hybrid Cloud Computing Set To Grow Rapidly According to IDC, public cloud is gaining traction but growth will come mainly from Infrastructure-as-a-Service (IaaS) and Software-as-a-Service (SaaS) 4. Spending on public cloud will be worth US$195 billion by while the hybrid cloud market will grow to a compound annual growth rate of 29% through Productivity, vendor lockin, security and privacy concerns will compel enterprises to embrace a hybrid cloud strategy. 5. Software-Defined Everything Virtually every piece of hardware in a data centre is being abstracted into a software tool. From routers to storage and servers, software-defined

3 03 networking and tools are finally maturing and will impact cloud decisions in The biggest benefit to enterprises: interoperable APIs that will allow for data centrewide software abstraction without vendor lock-ins. 6. Internet of Things (IoT) Will Drive PaaS Cloud Growth Working in tandem, IoT and the cloud will generate massive amounts of data through the cloud and enable rapid IoT service deployment worldwide. As a result, demand for Platform-as-a-Service (PaaS) will spike in a few years. IDC expects database, analytics, and IoT workloads to account for 22% of the total business workloads by 2020 and drive wider PaaS demand Cloud Demand Will Come From Data Analytics/ Management Business/data analytics and data storage/management are projected to lead cloud adoption strategies in 2017 and beyond. Nearly 22% of organisations surveyed expect business/data analytics to drive their cloud adoption plans while 21% expect to prioritise data storage/ management apps for cloud migration in In the next 12 months, enterprises will lean on cloud computing platforms to store and process large amounts of data and critical applications. Agility, scalability, security and the lack of cloud computing skills will persist as chief concerns for many CIOs even as they migrate to the cloud for greater efficiency and savings. Beyond 2017, the shift to the cloud as the new enterprise normal over the next five years will provide a significant boost to global economies. 1 Worldwide Semiannual Public Cloud Services Spending Guide, Gartner Inc: Prepare for the Next Phase of Hyperconvergence, January Forrester: Predictions 2017: Customer-Obsessed Enterprises Launch Cloud s Second Decade 4 Worldwide Semiannual Public Cloud Services Spending Guide, Ibid 6 Global Hybrid Cloud Market , Sandle Research 7 Worldwide Semiannual Public Cloud Services Spending Guide, Ibid Ensuring Success In Cloud Adoption With A Proven Cloud Operating Model By Sandip Gupta, Vice President Cloud Business, Singtel Faced with unprecedented levels of disruption, enterprises need to be agile to respond to competitive and market changes. In order to respond to these market forces, it s essential that organisations remodel themselves as dynamic businesses, giving themselves the flexibility to embrace speed, agility, innovation in the shortest time and reducing cost resulting in greater growth and profitability. As a result, more organisations are looking at a cloud-centric operating model to remake themselves and realise the benefits of a dramatically different way of running a business. This is a challenging proposition for many enterprises transitioning from a more traditional IT operating model; one where the IT department sources services reactively and at a fixed cost. But the shift to the cloud is a totally new paradigm that promises to digitally transform the way businesses are run. Running off the cloud, IT becomes the engine for responsive growth and agility where IT serves the business goals efficiently and dynamically, often in realtime and at a variable, not fixed, cost. The question then is how does your enterprise organise all the technical and non-technical aspects of the cloud, and how does it transform the current IT operating model into the cloud operating model needed in the new world? This transformation is driven by changing business requirements (read: digital disruptions) where the enterprise is expected to continuously perform a balancing act between its core functions (sales, finance, manufacturing, etc) and the business units (product divisions, geographic segments, etc) in investing, generating revenue, ensuring customer satisfaction and managing costs to ensure profitability. One of the routes to embracing this new, cloud operating model is to build a dynamic organisation that will transform and modernise applications and Sandip Gupta infrastructure. As companies migrate operations to a cloud architecture, the balance shifts from the core functions toward the business units, from a Capex mode to an Opex mindset, shifting dependencies on traditional functional IT services to a service-centric structure. The hybrid cloud offers enterprises an accelerated path to a service-centric IT platform, one where IT shifts focus from infrastructure to workloads and applications. And it s clear that many businesses agree. According to research firm IDC, an estimated 65% of Asia- Pacific enterprises will commit to hybrid cloud architecture in A Changing Mindset The most successful cloud adoptions include fundamental changes to every aspect of a business IT operations model, extending well beyond technology to include people and processes. The industry is evolving from the euphoria of cloud and realising the reality and trying to get to maturity. The reality is that the outcomes that businesses aspired for may have been sporadic and non-repeatable. The challenge for those seeking to follow the footsteps of other s limited successes, is that each transformation has followed its own unique path, and those who ve enjoyed success see this

4 04 as part of their secret sauce and are keeping the details to themselves. If we want to see mass success with hybrid cloud adoption, businesses need a blueprint to follow. In particular, industries such as financial services and healthcare, with strict governance guidelines, require clearly documented framework for the adoption of new technologies. A framework that gets them to cloud maturity something that is repeatable and prepares them for the future. The Cloud Operating Model Framework The goal of the Cloud Operating Model (COM) is to accelerate the adoption of hybrid cloud and get enterprises to maturity. IDC measures an organisation s current hybrid cloud maturity on a five-step scale, from ad hoc, through to optimised 2. It identifies the dimensions of core IT and business readiness for an organisation, giving them clear outcomes to measure at full maturity. For each stage of maturity, the COM provides a framework for operations to build a certain set of capabilities. The model addresses the need for cultural change including forming new team structures, creating new roles and acquiring new skills. The traditional silos of server, security, storage and network translates into service owners, DevOps/Cloud Ops, platform engineering, etc. This should lead to convergence of skills, better productivity and an agile organisation prepared for digital transformation. It warrants the need for collaboration with other lines of business (LOB) and finance the core functions of the enterprise. Ideally, your IT department will give LOB users the ability to launch and consume cloud services themselves. You should also be able to track usage and bill departments inside your company. If your IT department doesn t operate this way, it will likely become bogged down with managing constant software releases and service requests. These new ways of working set the scene for adopting new processes for managing cloud services. This includes creating new workflows and policies, for example around API usage. This approach paves the way for standardisation, optimisation and ultimately automation, where the end state would be for businesses to automate policy-based brokering of service requests across hybrid resources. Alongside this, a governance framework provides the structure for moving budgets from Capex to Opex, defining new KPIs and SLAs and evaluating and adapting existing security policies. Policies driven governance to drive stricter compliance and better user empowerment. For example, will a test server and production server be deployed differently? Is there an advantage to having some applications run on your on-premises data server, and others in the cloud? Automating the selection and migration of workloads can allow your developers, testers and infrastructure engineers to create and deploy software quickly and easily. The model also addresses an approach to developing an ecosystem of service and industry application partners to support your organisation s transformation drive. Adopting The Model The advantage in implementing COM is that the enterprise can quickly test and publish new services without being tied up with complicated questions about where and how workloads are hosted and in what cloud. Organisations will know how much they are spending on cloud infrastructure at any moment, and be able to easily and quickly adjust spending as budgets change, ultimately allowing them to validate cloud strategy and spending. Most importantly, the business can respond much faster and cost-effectively. While intended as a blueprint for hybrid cloud success, the model is adaptable to an organisation s needs. Generally, around 60% of the COM framework will be applicable to every business, with the remainder being personalised to your unique set of circumstances. For example, if your data centre contract is expiring, or you are looking to build a new cloud native app, your software/hardware is end-of-life, or you are looking for a new partner The goal of the Cloud Operating Model (COM) is to accelerate the adoption of hybrid cloud and get enterprises to maturity.

5 05 to manage your infrastructure, you should consider creating a softwaredefined infrastructure across multiple clouds. Aligning IT To Your Business Goals A pre-requisite for success is having a clear strategy and a set of goals for the IT organisation that are clearly linked to the goals of the business. The COM can provide a framework and the building blocks to develop this strategy and define these goals. Transforming your business is important and necessary; ongoing market disruption means that the inability for businesses to quickly respond to market threats and opportunities puts them at a competitive disadvantage and poses survival threats. It s essential that IT organisations are aligned to these challenges and structured in such a way that allows the business to be innovative and to act with speed and agility. This requirement goes well beyond technology adoption and needs to start with people and process. The COM Framework The COM framework acknowledges that businesses are at different stages with cloud adoption and offers them a framework to identify their current level of maturity. It defines what their end state should look like and recommends how users can move themselves through the stages of euphoria to reality to maturity. The COM framework also serves as a roadmap to help organisations define their future state of maturity; one where they have the capabilities to deliver services to their customers and employees using a software-defined architecture and the hybrid cloud. In each critical area of operation security, networking, personnel, interoperability and automation Singtel offers a blueprint to assess where organisations want to be and the tools and services to reach their hybrid cloud destination. 1 IDC Press Release: Hybrid Cloud: The New Standard for Delivery of Digital Transformation 2 IDC MaturityScape: Hybrid Cloud Management Keeping It In The Clouds For any business looking to grow with the cloud, there are three priorities. So, your organisation has made the move to the cloud. You ve crunched the numbers, studied the processes, convinced upper management, and shortlisted the cloud service providers. But you still have concerns if the migration to cloud computing will work. How can you guarantee the shift to the cloud will be a success for your company? Experienced IT leaders understand there are essential components that must be in place to realise the savings and productivity the cloud will deliver. If you plan to grow with the cloud, you must tackle these three priorities: Security, Interoperability and Manageability. Security: Proven Framework Cloud security is a multi-layered affair, requiring shared responsibility between users and service providers, and a strong, wide-ranging arsenal of security technologies and policies. No single product or solution can solve all of today s regulatory, application and data security requirements. Before committing to a cloud service contract, businesses must examine what are these cloud security solutions. Does the range of security solutions cover the level of endpoint protection you re expecting? Is there adequate data encryption to protect your data and applications at all times at rest, in motion, and in use, across a hybrid cloud environment? Does your cloud service provider have shared access management through integrated enterprise directories to prevent unauthorised access? Are security protocols and policies aligned to your own on-premise security framework? A cloud service provider with diverse security partnerships will ensure consistent security auditing and upto-date certifications. For example, does the cloud provider hold SOC1 and 2 (Service Organisation Controls) certifications? Does it satisfy the requirements for the PCI DSS (Payment Card Industry Data Security Standard) certification as stipulated by the financial services industry? Regular thirdparty internal audits, risk assessments, and an on-going certification and standards regime are signs of your cloud service provider are committed to a sound security model. Interoperability: Playing Nice If you plan to host applications and data in the cloud, you want the freedom to move among the clouds from public to private and back again. Such freedom requires full data interoperability as well as abstraction from the hardware but no two vendors cloud environments implement their clouds in exactly the same way. That means different hypervisors, processes, network addressing, directory services, firewalls, routers, switches, identity services, security, cloud APIs, licensing

6 06 models and more, all of which probably did not exist with the original application environment. Experts suggest two steps to ensure you are not locked into any one particular offering: Embrace microservices and containers. Microservices are smaller, independent application service units that allow developers to write and upgrade code without disrupting the other parts of the application. Containers help to move this code seamlessly across virtual machines, private cloud and public cloud, and provides everything from an operating system to the code responsible for executing a task. Google Container Engine or Amazon EC2 Container Service are examples of enterprise containers for microservices. Adopt a single-view management platform. Whether it s a private cloud or multiple clouds, a singleview management framework that your IT team already understands will allow for a seamless application move to a target cloud, even if you have to port the applications. Manageabillity: Orchestrate And Automate The automation and orchestration of workflow processes is an essential component of cloud computing. Without them, an IT team would have to perform hundreds of these tasks manually adding new instances during an auto scaling event, elastic load balancers, alarms, etc and in a specific sequence, with roles, security tools and permissions stipulated to ensure everything works as expected. Cloud orchestration and automation, when done correctly, will lower overall IT costs, free up engineering time and improve delivery times. But not every organisation has the resources, personnel or the appropriate IT policies to enable effective cloud orchestration and automation. When evaluating your cloud provider choices, make sure you have detailed workflow diagrams the cloud provider uses for orchestration. Ask for a live demonstration of the cloud management platform, ordering process, and the orchestration workflows. This orchestration system will also allow Orchestration system will also allow you to bridge your traditional IT and cloud systems allowing you to leverage existing scripts and automation tools while transitioning long-term to more sophisticated orchestration workflows. you to bridge your traditional IT and cloud systems allowing you to leverage existing scripts and automation tools while transitioning long-term to more sophisticated orchestration workflows. Please approach your Singtel Account Manager or cloud@singtel.com to find out how Singtel can help you drive success in hybrid cloud adoption.