I D C M A R K E T S P O T L I G H T. P r i va t e a n d H yb r i d C l o u d s E n a b l e New L e ve l s o f B u s i n e s s and IT Collaboration
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1 I D C M A R K E T S P O T L I G H T P r i va t e a n d H yb r i d C l o u d s E n a b l e New L e ve l s o f B u s i n e s s and IT Collaboration September 2013 Adapted from IDC Maturity Model: Cloud A Guide for Success by Mary Johnston Turner, IDC # Sponsored by SUSE Cloud computing is rapidly changing how businesses and institutions evaluate, procure, deploy, and optimize business processes enabled by IT assets. IDC's research indicates that 71% of all companies in North America are in the process of using, planning to use, or researching the value of for their business. These organizations understand that capabilities such as self-service provisioning; dynamic, elastic scaling and pooling of resources; policy-based automation; and usage-based payment and chargeback schemes have the potential to fundamentally transform the way that business and IT teams engage to enable faster creation and delivery of a wide range of business services. At the same time, IT decision makers understand that the security, compliance, and service-level requirements of mission-critical applications and workloads necessitate a mature approach to the purchase, provisioning, and management of resources. In many cases, multitier applications may rely on a hybrid mix of traditional physical and virtual infrastructure resources as well as solutions. As a result, many IT organizations are beginning their journey to with in-house, projects that allow business and IT stakeholders to partner as they develop a strategy for how can transform the delivery of IT services across their organization. As their understanding of how to best deliver services using architectures matures, many organizations extend this insight to create hybrid environments that strategically leverage public services in addition to in-house resources. This Market Spotlight looks at the role that and hybrid s will have in transforming the way that IT teams and business groups can partner and innovate over the next several years. Trends in Enterprise Adoption of Cloud: Service-Centric Hybrid Architectures Emerge At its core, computing can be defined as an IT architecture that allows on-demand, self-service access to shared IT resources using standard protocols and automation. Cloud goes beyond simple virtualization to enable dynamic sharing, pooling, and provisioning of infrastructure and application resources. Clouds in general leverage virtualized infrastructure but focus on the delivery of standardized resources and services using service catalogs and predefined templates and policies. Clouds can be implemented by in-house IT staff and service providers. Private s are generally deployed in a single organization's datacenter or hosted on a dedicated or colocation basis. Many organizations may also use selected public services to create hybrid environments that mix public and options. As Figure 1 shows, over the next few years, the majority of IT organizations polled by IDC expect to shift IT spending away from traditional physical and virtual architectures to a hybrid mix of solutions, with the greatest focus being on s. IDC 1562
2 F i g u r e 1 Shifting Investments from Traditional IT to Cloud, Now and in 24 Months Q. How much of your company's IT budget is allocated to buying and managing these different types of IT services, today and 24 months out? Traditional IT Deployment Models Dedicated/single-tenant Cloud Services Deployment Models Shared/multitenant Traditional on-premise IT Traditional outsourcing Self-run Managed Dedicated Virtual Public Customer site Service provider site IT budget in 24 months Change 36% 13% 17% 19% 15% -11 pts -1 pt +6 pts +4 pts +2 pts n = 801 Note: Respondents represent companies with 100+ employees. Source: IDC's North American CloudTrack Survey, 2012 IDC's research indicates that most organizations develop and implement strategies in phases, over time, as they become more comfortable with defining standard configurations and service policies and drive use of standard APIs and automation across their IT environment. The journey often requires business and IT stakeholders to collaborate closely to define service offerings, SLAs, and user self-service capabilities, but the result can be a much more agile and responsive IT environment. IDC's Cloud Maturity Model traces the increasing value of and investment in computing across five stages, from ad hoc, project-based programs to optimized, policy-based strategies. The stages are summarized as follows: Stage 1: Ad Hoc. Companies are beginning the exploration process to increase their awareness of technology options, key considerations, and 's contribution toward IT efficiency. Most investments focus on specific projects or use cases. Stage 2: Opportunistic. Companies are testing their ability to transition workloads from existing architectures to on a case-by-case basis. Most initiatives consider for new solutions or isolated computing environments with minimal impact on existing business processes or IT resources, but companies are beginning to view as a viable option for a range of use cases. Stage 3: Repeatable. Companies are enabling more agile access to IT resources through aggressive standardization, identifying best practices, and increasing governance. Business and IT users are beginning to rely on self-service portals to access a range of services as well as to automate approvals and workflows that are necessary to rapidly provision and activate services IDC
3 Stage 4: Managed. Companies are expanding the boundaries of how and why they use and adopting a consistent, best practice enterprisewide approach to, speeding iterative improvement cycles to increase adoption and business value. Companies in this stage are orchestrating service delivery across an integrated set of resources and collaborating internally and externally to support their future technology needs. Stage 5: Optimized. Companies are driving business innovation through seamless access to a hybrid mix of resources. They are using to lower the costs and speed up the delivery process. The business impact is most noticeable for new initiatives as well as for high business value or highly innovative projects, where some level of customization of IT resources is critical and risk sharing creates an environment that fosters innovation. The most important strategic shift that takes place during this progression is the recognition that a consistent, standard set of APIs and interfaces is needed to streamline end-to-end automation and that the business needs to establish clear service definitions and policies related to performance, cost, security, user access, regulatory constraints, and other business policies. Once a policy-based, service-centric approach to defining and deploying workloads has been implemented using standard open APIs, IT organizations can automate the deployment of workloads across pooled resources and hybrid environments without disrupting day-to-day business operations. Benefits: IT Teams Become Strategic Business Partners Effective use of architectures requires IT and business stakeholders to shift focus from simply monitoring the health and performance of components and applications to targeting the performance, security, access controls, and availability of end-to-end services, regardless of where the workloads reside physically. This pivot to focusing on services and end-to-end service delivery allows IT organizations to redefine their relationships with business stakeholders and creates opportunities for IT teams to automate many low-value repeatable activities while freeing time to add more value to strategic business uses of IT. By using standards and automation to decouple workloads and services from hardware stacks, IT organizations can allow their business stakeholders to focus on service requirements. Private and hybrid architectures then allow IT teams to share resources across a range of workloads and user groups, shifting resource consumption as different applications have different needs. This increases IT resource utilization and helps control the overall cost of IT delivery. Simultaneously, the adoption of standard service definitions, configurations, approval processes, and self-service provisioning options allows IT to automate increasingly time-consuming activities and to empower end users to be more self-sufficient. Standardized services are often more reliable and easier to upgrade and patch using advanced configuration and provisioning automation technologies. For IT staff, the shift to service-centric strategies provides a unique opportunity to improve IT staff productivity, consolidate existing legacy management tools and processes, and become more responsive to business requirements. IDC's research shows that increased use of virtualization and, proliferation of mobile devices and multitier application architectures, and rising use of big data analytics are all contributing to the complexity of today's IT environments. The need for IT teams to be able to focus on harnessing technologies to add value to the business has never been greater. Adopting an automated, service-centric approach to and hybrid operations is an important strategy for helping IT teams spend less time on low-value infrastructure support tasks while allowing them to increase the value they add to the business IDC 3
4 Considerations For many IT organizations, the thought of moving to a more standardized, open architecture may seem somewhat threatening as many traditional activities become automated and end users become more self-sufficient in terms of ordering and provisioning many routine services. Some IT staff may be concerned that their skills and insight will no longer be valued by the organization, causing them to resist change or slow down innovation. They may also be concerned about the challenges related to acquiring new skills or learning new management tools. IDC's research indicates that many early adopters have indeed found that enables them to streamline, integrate, and simplify management software environments and processes (see Figure 2). Most early adopters have welcomed this opportunity to streamline overly complex management environments and have welcomed the opportunity to better partner with business stakeholders and focus more clearly on supporting critical business services. F i g u r e 2 Extent to Which Organization's Cloud Strategy Is Driving the Consolidation or Elimination of Existing In-House Management Software Products NA/unsure (7.5%) Low (10.4%) High (33.8%) Moderate (48.2%) n = 201 Source: IDC's IT Management QuickPoll, January 2013 Taking a phased approach to gradually building a mature, service-centric strategy helps mitigate many of these concerns as IT and business decision makers collaborate at each phase to focus on how to best architect environments to add value to the business. Conclusion: Phased Transitions Provide Opportunity to IT and Business to Collaborate over the Long Run IDC expects that over the next five years, most enterprise IT organizations will embrace hybrid IT or hybrid strategies, driven by the divergent needs of different types of workloads, applications, and user groups. As a result, use cases and ROI models for s will evolve from emphasizing ad hoc, rapid dev/ops deployment to focusing on runtime production application scalability, end-user productivity, and competitive business advantage. Computing and analytics applications that benefit from highly liquid IT architectures can be expected to help lead the IDC
5 transformation of datacenters and IT management strategies, while content and information storage, management, and distribution volumes will challenge IT decision makers to consider how to best pool and share resources to maintain service levels while keeping costs manageable. IDC expects architectures will be an important part of many hybrid enterprise IT infrastructure strategies for a number of years and will challenge IT decision makers to develop more streamlined, automated, and integrated approaches to optimizing a wide range of IT management, governance, and compliance processes and workflows as these environments evolve. IT decision makers should take a leadership role in moving their organization from ad hoc to mature, optimized environments and partner with business leaders to ensure that service SLAs, governance, and self-service policies are consistent with business priorities and goals. A B O U T T H I S P U B L I C A T I ON This publication was produced by IDC Go-to-Market Services. The opinion, analysis, and research results presented herein are drawn from more detailed research and analysis independently conducted and published by IDC, unless specific vendor sponsorship is noted. IDC Go-to-Market Services makes IDC content available in a wide range of formats for distribution by various companies. A license to distribute IDC content does not imply endorsement of or opinion about the licensee. C O P Y R I G H T A N D R E S T R I C T I O N S Any IDC information or reference to IDC that is to be used in advertising, press releases, or promotional materials requires prior written approval from IDC. For permission requests, contact the GMS information line at or gms@idc.com. Translation and/or localization of this document requires an additional license from IDC. For more information on IDC, visit For more information on IDC GMS, visit Global Headquarters: 5 Speen Street Framingham, MA USA P F IDC 5
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