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June 2011

The basics of cloud computing

By Samir Kapadia | Chartered Accountants
Reading Time 7 mins
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Part 3

About this article:
In the previous write-up on this issue we discussed certain important aspects about cloud computing including key terminology and some offerings. This write-up focusses on certain issues which would require consideration before one decides to opt for cloud services.

Background:
Cloud computing basically refers to providing the means through which everything i.e., from computing power to computing infrastructure, applications, business processes to personal collaboration, can be delivered to you as a service wherever and whenever you need. This model is fast emerging as the choice of several large and small businesses. The choice is quite natural considering the (assured) cost savings. Such savings can be either in the form of lower capital expenditure on hardware, software licence, infrastructure or in the form of lower operational expenditure i.e., operation and maintenance expense or reducing idle time, downtime, etc. (refer to the write-up titled Cloud computing basics — part I published in BCAJ April 2011 issue).

Businesses, large and small, have several options, between whether to opt for private or public or hybrid clouds (refer to the write-up titled Cloud computing basics — part II published in BCAJ May 2011 issue). Having several options itself, sometimes, becomes a hurdle while making strategic investments. Cloud computing also brings to the fore certain unique concerns, concerns which are more significant from the ‘enterprise’ point of view.

Primary objective of moving to the cloud:
As organisations evaluate how cloud computing can achieve these advantages, they are faced with numerous choices. While moving to the cloud has definite advantages such as — improving business agility, reducing management complexity and controlling costs, etc., one needs to appreciate that simply moving towards a service-oriented cloud computing model does not automatically deliver benefits. To derive maximum benefit and Return on Investment (ROI), cloud computing needs to be considered as part of a larger move towards more effective management and integration. Needless to say inadequate planning and half-baked cloud computing solutions may add complexities rather than reduce them.

Some myths and some clarifications:
While there are several myths and misconceptions associated with the topic of cloud computing, the ones that the readers of this journal are more likely to identify with are:

Myth 1:

Data security: Will the cloud service provider guarantee security?

One common concern amongst businesses looking to move to cloud computing is data security. Primarily, moving to the cloud entails — parking your data with the service provider, this can be a discomforting thought. The very possibility of threat to confidentiality and security of the data is the source of discomfort.

From a practical standpoint, public cloud datacentres are amongst the most secure premises on the planet. Yet, at the logical level, a cloud provider with every security certification still can’t guarantee the integrity of specific servers, applications, and networks, if your applications are poorly written, set up and secured. Similarly, all the security practices of a cloud provider are meaningless if a customer organisation’s security practices are weak.

The key take-away here is that there are several layers of security to protect your data, but there is always a possibility of chinks in the armour.

Myth 2:

Data control: My organisation will be locked into one vendor and lose control of its data, if it moves to the cloud:

Almost every organisation would acknowledge that businesses need to store shared files securely. This would assume more importance when the organisation is engaged in providing medical, legal and financial services. These organisations are subject to strict local laws.

If one believes that the best way to keep your data a secret is to manage it yourself, then the moot question would be why stash your precious data offsite?

It is relevant to point out that the essence of cloud services is ‘flexibility’. One application may call another on a different cloud service, and data may be stored anywhere, including your own network, but still be accessible to cloud applications. No cloud provider offers a service that completely takes control of your environment. The best cloud solutions will be a combination of on and offpremise services.

The key take-away is that while the service provider may control the infrastructure, the data is not entirely in his control. Sure!!! he controls your access to your own data, but his primary interest is merely optimal utilisation of his resources (just like you).

Myth 3:

Cost savings: An organisation must move all its applications to a cloud service to be able to benefit fully from cloud computing:

Moving an entire datacenter to the cloud is a tall task. Practically, no cloud provider would recommend this, at least not at one go (if you ask me — you are inviting trouble). Ideally, one should adopt a step-by-step approach. One should start by identifying applications in his pipeline that can benefit his organisation by being in the cloud. Look for applications where resources are used intensely for a short period each month then left idle for the rest of the time, or applications where a moderate level of resources are used continuously, but experience ‘periods’ of very high activity.

Such applications are ideal cloud candidates. This is so, because the cloud can scale up and down resources on demand. The cloud is built for flexible access to resources that can be allocated to other applications, or even other customers, when idle.

The key take-away is that one should do a cost benefit analysis of all activities undertaken and gauge the advantages/disadvantages of shifting to the cloud. A proper evaluation would also ensure that you minimise disruptions and costs associated thereto. Who knows, the sum of all parts may be greater than the whole.

Myth 4:

IT role changes: Do I still need an IT administrator?

The role of the Exchange Administrator does not become obsolete due to the cloud. There are still many tasks that remain on-premise. You still have to manage your users and their mailboxes. Industry-specific data retention compliance, as well as implementing custom workflows, is still your responsibility. While some tasks may no longer reside on-premise, managed cloud services free up your time to engage in more strategic roles, providing you with new opportunities.

Apart from patching those servers and physically maintaining them, all other aspects of managing applications remain in the IT administrator’s hands. Monitoring, updating, integration with services such as Active Directory, security and network monitoring — these task are still required within organisations utilising cloud services.

The key take-away is that the all powerful IT administrator’s role is impacted, but the role does not get diminished. The IT administrator’s role will evolve as the availability of compute cycles and networked storage increase — that is a given, just as the IT role has evolved in the past. The question IT administrators must ask themselves is, ‘Am I prepared to play a more strategic role in my organisation?’

Myth 5:

Getting started: All you need is your credit card to start cloud computing:

You can begin using cloud computing services with just a credit card. This is a good way to get experience with this new frontier of services, in fact some of the basic services may be available free. Most cloud services provide an environment designed for getting started and developing applications.

It is important that one gets used to the concept and gain comfort. Post this one may evaluate the advantages/disadvantages of moving to the cloud.

The key take-away is take small, measured steps. Learn from experience before betting it all.

In summary:

There are pros and there are cons, also there are hyped stories of success and spiced-up stories of failure. Readers may well be cautioned to do their own research and allay their fears of this emerging service. While the service provider may promise you the moon, one should pare his expectations and make investments only upon realising measured benefits. In short, look before you leap!!!!!!!

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