The Business Case For Private Cloud Services

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1 Velocity Technology Solutions / May 015 This Private Cloud Services guide will: Define a common vocabulary around Private Cloud Service Providers Describe how Private Cloud Services can reduce the total cost of ownership (TCO) Provide a TCO analysis of a traditional vs. private cloud model Identify ways in which a Private Cloud Service model decreases risk Identify ways in which a Private Cloud Service model increases productivity

2 Defining Private Cloud Service Providers TABLE OF CONTENTS Defining Private Cloud Service Providers A Great Time To Move To The Private Cloud How Private Cloud Service Providers Lower TCO 5 A TCO Analysis: Traditional On-Premise vs. Cloud Service Provider 6 How Private Cloud Service Providers Reduce Risk 8 Ways Cloud Service Providers Reduce Risk 9 How Private Cloud Service Providers Increase Productivity Characteristics of a Shared Service Model 70% A Private Cloud Service Provider offers application of private cloud adopters use third parties to manage their environments 1 $8 billion 0 1 A Public Cloud Service Provider uses commoditized components to deliver generic services co-mingled across industry, domain and application. The adoption of private cloud services is expected to grow by over 0% in 015, more than X as fast as the growth of public clouds. In 0 the global private cloud market was worth hosting and software services available through a private cloud dedicated to a single enterprise. 0% 015 Public Cloud Growth In 01 the global private cloud market was worth $ billion 015 Private Cloud Growth x faster growth than public clouds By 018 the global private cloud market is expected to be worth $69 billion Private Cloud Customer Research Report, Technology Business Research, 01, Private Cloud Customer Research Report, Technology Business Research, 01,

3 A Great Time To Move To The Private Cloud How Private Cloud Service Providers Lower TCO JD EDWARDS UPGRADE HARDWARE END OF LIFE DIVESTITURES OR ACQUISITIONS The cost savings achieved through a private cloud model has sparked its rapid adoption. There are a number of factors that contribute to the lower TCO of private cloud services. Traditional On-Premise Large upfront capital expenditure for hardware and migration Private Cloud Zero to minimal upfront costs When you are planning a major upgrade When planning a major JD Edwards application upgrade, there is typically a need for additional hardware capacity to perform the upgrade. When your hardware needs a refresh Aging infrastructure requires a refresh of hardware and technology that may justify the move to the cloud. Once in the cloud, your business will not have to worry about spending CapEx on hardware again. When your business hits a milestone event Acquisitions or divestitures often require building new environments which are expensive and consume large amounts of resources at a time when those resources are already overloaded with acquisition/ divestiture activities. Multiple experts across a wide skill set for solutions - MM, SD, FICO, etc. are cost prohibitive Recurring costs to refresh, fix and maintain systems Fractionalizes the cost of industry experts across multiple clients Low, predictable monthly costs for 5, 7 or years Long processes for new installations Cuts timeline by 5-0% due to hardware procurements, provisioning, etc Limited agility and flexibility in response to changes and demands on environment, space and resources Leverage economies of scope and scale (pay for only the environmental footprint and staff you need at any given time) 5

4 A TCO Analysis: Traditional On-Premise vs. Cloud Service Provider See how the TCO of JD Edwards applications differs between cloud and traditional models over a 1 year period. VELOCITY COMPONENT ON-PREMISE PAY TO: PRIVATE CLOUD PAY TO: JD Edwards Resources () - JDE $0,000 Internal Headcount Included Velocity Infra, JDE CNC Admin Budgets Allocation of DBAs, Server Admin $80,000 Internal FTE, Included Velocity (0.5 at $160k) rd Party Advantages of Velocity s Private Cloud Model Vs. Multiple Vendors 1 JD Edwards-Specific Expertise. Expertise across every component. A cloud built for your software. 9 Virtual Servers and storage $81,000 Internal Spend, Included Velocity ($750 per server and SAN per month) Lease or Co- Location Partner Space, power, bandwidth $6,000 Internal Spend Included Velocity or Co-Location Partner Server Admin $85k) $1,50 Internal Headcount Included Velocity Backup and Recovery, off site storage $,000 Internal Spend Included Velocity or rd Party Third Party DR service $0,000 rd Party Included Velocity Simplified Vendor Management. One invoice, one phone number, one relationship. Increased Accountability. No finger pointing between multiple vendors. TOTAL ONE YEAR COSTS $71,50 $00,000 Velocity Cost savings = $71,50 What business improvements could you make with an extra $71,50? * Assumptions: JD Edwards Financials, Distribution, Manufacturing: approx 50 users of each. Velocity Hosting, JD Edwards Infrastructure MS, JD Edwards Applications Admin/MS. Please note that budgetary estimates do not necessarily reflect actual costs for the management of your specific application. 6 7

5 How Private Cloud Service Providers Reduce Risk Ways Cloud Service Providers Reduce Risk 1 Ensure your ERP system stays current with the most recent releases and up-to-date with industry-specific requirements (e.g. tax updates required for payroll). Risk [risk] The probability that a natural event, resource or system could exploit a vulnerability in the application or ERP system that causes business loss. Plan for the impacts that updates and patches have on your ERP system configuration, customization and performance. Test your applications based on your requirements in the development environment and after the updates are applied in production. Identify customizations and manual processes that can be eliminated as a result of the updates or patches. 5 Deploy best practices based on how other clients across a wide range of industries and platforms are leveraging the latest updates to improve their processes. According to a leading technology market research firm, enterprise businesses in North America lose as much as $0 million per year in downtime related to information and communication technology. Larger organizations may be apt to manage the infrastructure, implementation, upgrades, updates, end-user support and functional support required for large ERP applications. But for many businesses, in-house application management places a heavy burden on internal IT resources, especially at the point of major upgrades Fully manage the cut-over from the development environment to production. Provide analytics to monitor segregation of duties and make business process optimizations and manage compliance. Eliminate HR risks associated with the knowledge transfer and ramp-up time required with any new personnel or turn over within your business technical and functional teams. Ensure compliance with changing and complex requirements for your industry. Provide disaster recovery (DR) services in the event of a natural disaster. Infonetics:Technology and Network Downtime Costing Businesses $ Million a Year, February, 015, Market Wired, How Private Cloud Service Providers Ensure Application Compliance Control in a virtual private cloud Focus on ITL Software-defined environments Third-party audit and attestation Penetration testing Advanced logging and monitoring Disaster Recovery Data Center Requirements If you are considering a private cloud service provider for DR services, check to see if their data center locations meet the following criteria: FEMA region coordination (MDR/EDR) Network bandwidth Capacity planning Optimization Dedication/syndication levels Storage management Each DC connected to other DC 8 9

6 How Private Cloud Service Providers Increase Productivity Progressive organizations realize that placing resources on the tasks best fit for their skill set increases productivity. Private Cloud Service Providers have resources specifically trained in your application within your industry to manage your applications. Private Cloud Service Providers can: Free-up talented resources to focus on strategic initiatives vs. tactical tasks associated with managing software applications and environments. Manage multiple and simultaneous demands of various businesses within your organizations (e.g. HR, Finance & Payroll) through a shared service model. Provide comparison analytics for similar-sized organizations in your industry to identify bottlenecks that prevent streamlined processes and monitor compliance and risk. Characteristics of a Shared Service Model 1. Alignment of subject matter experts (SMEs). Guaranteed service levels. Platform agnostic best practices and thought leadership. Preparation for business events (e.g. an acquisition) 5. Ticketing system 6. Periodic strategy meetings 7. /7/65 call center 8. Service transparency 9. Eliminate risk associated with staff turnover Operational expertise, scalability and affordability just are some of the reasons more companies are turning to Private Cloud Service Providers. It s a trend that is likely to continue as IT environments grow more complex and resources become increasingly burdened. Velocity Technology Solutions, Inc. is a leader in enterprise and business application hosting services which are fully-managed and protected within a virtual private cloud. Velocity lowers operational costs, provides world-class customer experiences, and delivers application access at top levels of performance and availability. Velocity s expertise managing software /7, combined with its proprietary infrastructure design and cloud management platform, guarantee the availability, security, and control over software. Velocity is the trusted partner for rapidly deploying application software into a secure and resilient virtual private cloud. Velocity is headquartered in Charlotte, North Carolina with facilities in North America, Europe, and Asia. Velocity is a portfolio company of Silver Lake Sumeru, a global leader in private equity investments in growth-oriented technology and technology-enabled companies. 11

7 Velocity Technology Solutions 1901 Roxborough Road, th Floor Charlotte, NC 811 Phone: Fax: VelocityCloud.com Velocity and the Velocity logo are registered trademarks of Velocity Technology Solutions, Inc. 015 Velocity Technology Solutions, Inc. All rights reserved. All other trademarks are the property of their respective owners BCPRIVCLOUDJDE

The Business Case For Private Cloud Services

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