1 White Paper Creating an Enterprise-Wide Cloud Strategy Theresa Villatore-Silva, NetApp July 2012 WP-7166 Executive Summary This paper discusses why a holistic strategy for cloud adoption should be a top priority for the enterprise today; provides guidance from NetApp s own experience on how to determine which workloads are best suited for migration to private, public, and hybrid clouds; and offers best practices about prioritizing workloads for transition to the cloud.
2 TABLE OF CONTENTS 1 Define Your Cloud Strategy to Amplify the Benefits You Achieve Benefits of a Having Cloud Strategy Best Practices in Creating a Cloud Strategy... 4 Step 1: Categorize Your Workloads... 4 Step 2: Determine Which Cloud Type Fits the Workload... 5 Step 3: Prioritize Workloads for Initial Projects Summary: Make Your Cloud Strategy a Business Priority... 7 LIST OF FIGURES Figure 1) Categorize your workloads according to their strategic value and operational flexibility Figure 2) Use guidelines to help determine which cloud type is best suited for your workloads Creating an Enterprise-Wide Cloud Strategy
3 1 Define Your Cloud Strategy to Amplify the Benefits You Achieve Among CIOs, cloud computing is no longer marketing fluff. More than a third of current IT budgets are allocated to cloud solutions, according to IDG Research 1, and fully 86% of respondents in a CIO survey said that they have cloud projects in progress or planned; 65% indicated that their enterprises will depend on private or hybrid clouds. Yet only 37% of respondents in the same poll said that they have an enterprise strategy for cloud adoption. That is a striking statistic, because research shows that companies with an enterprise-wide cloud strategy are far more successful at using the cloud to reduce costs, improve efficiency, and increase business agility than companies without such a strategy. This paper discusses why a holistic strategy for cloud adoption should be a top priority for the enterprise today; provides guidance from NetApp s own experience on how to determine which workloads are best suited for migration to private, public, and hybrid clouds; and offers best practices about prioritizing workloads for transition to the cloud. 2 Benefits of a Having Cloud Strategy The cloud model is mature enough to present real opportunities to those who embrace it, and an enterprise-wide cloud strategy provides a structured way to incorporate cloud services into the IT mix. It helps make sure that all stakeholders have a say in how, when, and where cloud adoption occurs. It can also offer advantages that you may not have considered. For example, creating a holistic cloud strategy can help you: Maximize the business benefits of the cloud. The advantages of moving to the cloud are numerous and compelling: cutting costs, improving efficiency, increasing agility, and so on and those benefits increase when there is a clear cloud strategy in place. According to an IDG study, companies with an enterprise-wide cloud strategy saw an average of 60% more cost savings than those without one. They also achieved higher efficiencies and were able to offer more IT services via the cloud. Uncover business benefits you might otherwise miss. The process of creating an enterprise cloud strategy can reveal opportunities you hadn t thought about. For example, one frequently overlooked advantage of the cloud is the ability to accelerate innovation. By moving certain functions to the cloud, IT can speed up the process of building, testing, and refining new applications so teams can explore more ideas, see what works and what doesn t, and get innovative products and services to market faster. Prepare the infrastructure you ll need. A well-thought-out cloud strategy provides an opportunity to consider some of the infrastructure needs of the cloud model up front rather than as an afterthought. By addressing the requirements for a shared, virtualized infrastructure of storage, compute, and network resources, companies can position themselves to transition workloads to the cloud model efficiently and at their own pace. Retain control in an era of on-demand cloud services. Today, anyone with a credit card can buy and use cloud-based IT services from and CRM applications to development platforms to compute and storage infrastructure. The consumerization of IT can pose huge risks for the enterprise. After all, the need for governance, compliance, and security doesn t disappear just because the IT services are sourced elsewhere. An enterprise-wide cloud strategy can help your business maintain control of how cloud services are purchased and used so that enterprise governance policies and standards can be managed and enforced Cloud Computing Research, IDG Enterprise Survey, November Creating an Enterprise-Wide Cloud Strategy
4 3 Best Practices in Creating a Cloud Strategy Creating a cloud strategy means determining which workloads are candidates for transitioning to the cloud model, which cloud type is best suited to a given workload, and how to prioritize workloads for migration. These can be complex decisions for most enterprises because so many variables are involved: the strategic value of the workload, the infrastructure and data dependencies of the applications, the availability of cloud services from service providers, build-versus-buy considerations, and so on. This section offers guidelines to help you create your enterprise cloud strategy. Step 1: Categorize Your Workloads An effective cloud strategy starts with a business-level evaluation and categorization of your workloads. This categorization should be based on the lifecycle and goals of the workloads, keeping in mind that the goals may change over time. There are two key dimensions to consider at this stage: the strategic value of the workload and the operational flexibility requirements of the workload. Strategic value indicates whether the workload is core (a competency or a source of competitive differentiation) or context (a vital function but not a source of differentiation). For example, most organizations would consider customer relationship management to be a context application; the information is important but the processing of that information doesn t provide strategic differentiation for the company. Operational flexibility indicates the complexity of the workload, how dependent a workload is on other applications or infrastructure, and how much it requires in terms of resources. For example, a custom application that is integrated with multiple applications but has finite resource requirements would be considered low in operational flexibility. Figure 1) Categorize your workloads according to their strategic value and operational flexibility. 4 Creating an Enterprise-Wide Cloud Strategy
5 Examining all of your applications to understand how they are currently deployed and whether to move them to the cloud is a valuable exercise. You may decide to keep business-critical applications in dedicated, application-based silos. Many of these applications will be candidates for virtualization and the cloud, but it may be too expensive or disruptive to move some of them in the near term. Many enterprises have a mixed data center model, in which the IT organization maintains some applications in dedicated infrastructures, embraces virtualization for the majority of applications, and evolves over time toward a private, public, or hybrid cloud. When you have categorized your workloads according to strategic value and operational flexibility, you are ready to move to the next step: determining which type of cloud model private, public, or hybrid is best suited for each workload. Step 2: Determine Which Cloud Type Fits the Workload With a list of categorized workloads that are candidates for the cloud, you can begin to consider which type of cloud will be most efficient and cost-effective for delivering that workload. There are three primary cloud types: Private cloud. A private cloud can be built and managed by either internal IT or an external service provider and operated solely for a specific organization, typically on-premise inside the firewall. IT services are offered to the organization s internal customers via a service catalog with self-service access, as well as showback or chargeback capabilities. Public cloud. Public cloud services are typically offered from third-party service providers who make resources such as applications and/or IT infrastructure available to subscribers on a pay-per-use basis. Hybrid cloud. A hybrid cloud offers the ability to link private clouds with public clouds in a pay-forwhat-you-use model. Hybrid clouds are in the early adoption phase. A common use case is when additional capacity or resources are needed for a specific time period. The rest of this section offers principles and examples to guide you in determining the appropriate cloud model for your workloads Figure 2) Use guidelines to help determine which cloud type is best suited for your workloads. 5 Creating an Enterprise-Wide Cloud Strategy
6 Public Clouds Applications and workloads that are most appropriate for public clouds tend to have low strategic value and high operational flexibility requirements. These workloads may not be core to your business; must adapt to dynamic demands such as peaks in usage; can be easily consumed in a self-service, pay-asyou-go model; and are readily available from cloud service providers. For example, nondifferentiating Web applications such as Webmail, office suites, order entry, and online auctions can be good candidates for the public cloud because external service providers can typically scale them quickly, on demand, and more cost effectively than internal IT organizations. In some cases, dev/test workloads are appropriate for public clouds where resources are needed quickly and for specific periods of time. Private Clouds Applications and workloads that are most appropriate for private clouds tend to have high strategic value and high operational flexibility requirements. These workloads may be core to your business, provide a source of differentiation for your company, and contain highly confidential and sensitive information. They may benefit from being available to your users on a self-service basis where you can meter and showback or chargeback for usage. For example, development and test workloads typically require high flexibility because the resources need to scale up and down as projects are initiated and completed, and they may be very strategic to your organization. Many dev/test workloads can benefit from a dynamic infrastructure that enables faster provisioning through automation, which can result in the ability to bring products and services to market faster. However, dev/test workloads can also be candidates for public cloud or even hybrid cloud, which can offer an on-demand, dynamic environment. Hybrid Clouds Applications and workloads that have low or high strategic value and high operational flexibility requirements can be good candidates for hybrid cloud. These workloads may have unpredictable requirements that require flexibility and scalability for spikes in demand, such as dev/test or external applications that have high user demand. When you have defined the most appropriate cloud type for your workloads, you are ready to plan and prioritize your cloud projects. Step 3: Prioritize Workloads for Initial Projects In prioritizing workloads to move to the cloud, many enterprises choose to build a private cloud first before moving workloads to a third-party service provider because of concerns such as security of data and loss of administrative control. Moving appropriate workloads to a private cloud may also make sense for IT organizations that have virtualized their environment and are ready to take the next steps to evolve to a private cloud with more advanced automation and self-service. Building a private cloud is also a consideration for taking advantage of a hybrid cloud in the future. Your decision depends on your organization s specific business needs. Here are a few guidelines to keep in mind: Prioritize less-critical or smaller workloads to move to a private cloud so you can gain experience and grow your cloud footprint gradually over time. Consider moving nonproduction workloads, such as development and test, to a private cloud to gain the benefits of a cloud environment with less risk exposure. Evaluate well-known and trusted cloud services from third-party service providers for workloads that are appropriate for public cloud. Consider setting a high priority on moving these workloads; this would enable you to begin to offload less strategic, noncore workloads and to free up IT resources to concentrate on more strategic projects. 6 Creating an Enterprise-Wide Cloud Strategy
7 4 Summary: Make Your Cloud Strategy a Business Priority The benefits of cloud computing are no longer theoretical or hypothetical. The cloud is here; the benefits are real; and the time to make the transition is now. But don t make your move to the cloud until you ve made a serious commitment to creating an enterprise-wide cloud strategy. The time you take to formalize your strategy will pay off in higher cost savings, better efficiency, more agility, and higher levels of innovation. Equally important, the process of creating an effective cloud strategy underscores the urgency of moving to the cloud model as a business imperative. It gets all key stakeholders thinking and talking about the best way to move forward; it clarifies the expected benefits and business results; and it prepares the organization for the tasks ahead. In short, it is a catalyst for maximizing the business benefits of cloud computing. You can learn more about NetApp for the cloud at For detailed guidance about evaluating and selecting cloud service providers, download the white paper Five Steps to Choosing an Enterprise-Class Cloud Service Provider. NetApp provides no representations or warranties regarding the accuracy, reliability, or serviceability of any information or recommendations provided in this publication, or with respect to any results that may be obtained by the use of the information or observance of any recommendations provided herein. The information in this document is distributed AS IS, and the use of this information or the implementation of any recommendations or techniques herein is a customer s responsibility and depends on the customer s ability to evaluate and integrate them into the customer s operational environment. This document and the information contained herein may be used solely in connection with the NetApp products discussed in this document NetApp, Inc. All rights reserved. No portions of this document may be reproduced without prior written consent of NetApp, Inc. Specifications are subject to change without notice. NetApp, the NetApp logo, and Go further, faster are trademarks or registered trademarks of NetApp, Inc. in the United States and/or other countries. All other brands or products are trademarks 7 Creating an Enterprise-Wide or registered Cloud trademarks Strategy of their respective holders and should be treated as such. WP-7166