1. Desktop Cloud ~ Applied Materials recently moved from 17 decentralized IT groups down to one. It decided to rid itself of the expense of changing out desktop PCs every three years, not to mention the cost of maintaining them. Instead, it virtualized many of its desktops, starting with its higher end Computer Aided Design (CAD) users that operate for the company from multiple sites around the world."We developed a desktop cloud for CAD," said Jay Kerley, Deputy CIO of Applied Materials.
He didn't see the point of keeping data tied to the desktop. By putting it on the cloud, the data follows users wherever they go, and they need only a screen to visualize it. Under the desks are stripped-down desktop blades with a Graphics Processing Unit (GPU) in place of big ticket workstations. In addition, high-speed networking is piped in to each cubicle to eliminate networking slows. Kerley added that HP Remote Graphics Software (RGS) was the final element that pulled everything together, enabling CAD professionals to collaborate in real time by accessing the cloud and seeing rich 3D designs on screen.
2. Using the Cloud to Lower Innovation Costs ~ Dave Smoley, CIO Flextronics International, used the cloud to lower the cost of innovation within a company that has 27 million manufacturing square feet at 130 locations in 30 countries. It operates two data centers with more than 400 TB of storage. Flextronics spends less than 1 percent on IT. Yet Smoley said unbelievably tight budgets necessitate tremendous internal innovation. In such an environment, he said, it often pays big dividends to look for newer ways to do things rather than opting for the industry leader that "everybody uses."For example, the company had many human resources applications running throughout the enterprise. When it came time to centralize on one platform, conventional wisdom pointed to the established HR package software used in 70 percent of large organizations. Although one business unit already used it, Flextronics partnered with the small cloud vendor find a simpler, more useable, faster and cheaper online tool.
"Leadership questioned not going with the market leader, but it saved us more than $15 million," said Smoley.
3. Internal Cloud ~ This example also comes from Flextronics. It wanted to harness social networking to speed up global collaboration. With many solutions on the market, the company again looked to cut costs by allowing a small Flextronics software team based in the Ukraine to experiment with an internal Facebook-type application it developed called Whisper Enterprise Collaboration, which has been piloted and is now being rolled out across the operation. Huge savings resulted by developing it using internal resources.
Similarly, Flextronics created an internal YouTube-type video sharing app for engineers to share problems and solutions with their peers around the world. Instead of spending hundreds of thousands, it ended up costing $8000 a year to connect to the app and host videos on the cloud."Companies will sell you $250,000 worth of equipment to house all your media, but why invest in it if it's obsolete in six months," said Smoley. "The cloud and the consumerization of IT are having a huge impact. Anyone can find a good bottle of wine for $60, but the trick is to find one for $10."
4. Bleaching the Cloud ~ Clorox Company had an aging infrastructure and had historically underinvested in IT. But as it expanded into a global market, this had to change. The company opened two centralized data centers, outsourced some data center hosting services, and put other services on the cloud. It upgraded from running Windows 2000 with four-year old Lotus email and aging Blackberrys a year ago to laptops running the latest versions of Windows, new smartphones and iPads. Despite having no money for this project, IT returned $500,000 to the bottom line."We achieved this by adding a lot more cloud based services and web-based apps," said Ralph Loura, CIO of Clorox.
For example, the cloud is used for Microsoft Exchange and SharePoint. The company tested them for two months then implemented.
"It works really well," said Loura. "Employees can use them from home and synch/connect from anywhere without having to go through a virtual private network firewall. And because it is on the cloud, it didn't cost anything more when all factors are taken into account."
5. Apps to the Cloud ~ HP CIO Randy Mott is pushing forward on a strategy to increase efficiency by moving many IT apps to the cloud. An inventory of global revealed that eight to 10 apps were doing the same thing in different parts of HP operations. He blamed this, in part, for keeping IT focused too much on maintenance of the existing infrastructure rather than on innovation to increase business productivity. The inventory also revealed that HP had 85 data centers in 29 countries running more than 7,000 applications, 700 data marts and 1,240 active business projects all for internal IT. From that, the company went to six data centers, less than 1,700 apps, one enterprise data warehouse and 500 active business projects.
"That kind of inefficiency meant we could only spend 10 percent of our time on innovation and the rest on keeping the lights on," said Mott.
The company divided its apps into two categories. Enterprise applications will comprise 45 percent of the consolidated HP global IT platform and will be hosted internally. The rest will be delivered as software as a service on the cloud.
"It takes leadership and vision to adopt a next-generation architecture and to push through all the barriers to achieve real gains," said Mott. "By doing so, we took IT spend from 4 percent of our revenues down to 2 percent."
6. Cloud Acceleration ~ An industrial pump company known as Pump Solutions Group (PSG) has a data center in Southern California that it augments with cloud-based storage. Jeff Rountree, Global Network Manager for PSG, implemented cloud resources managed by AT&T, which has rapidly established itself as one of the major players in cloud infrastructure. But he realized that solving mushrooming storage demands by throwing everything onto the cloud was a recipe for trouble. Initially, the apparent low cost of storage would save the organization money.
However, as data was placed on the cloud indiscriminately, he foresaw a future where storage again began to cost the organization too much. After all, most cloud providers charge by GB, often based on how many GBs uploaded and how many downloaded.
Instead of shipping everything to the cloud, therefore, Rountree saw the value of deduplicating and encrypting his backups before sending them to AT&T. He purchased the Whitewater Cloud Storage Accelerator by Riverbed.
"Why pay for 100 GB when you can deduplicate it and pay for 10 GB instead," Rountree said.
For disaster recovery purposes, he set it up that AT&T would keep local and remote copies of his backups to ensure redundancy and failover, should the AT&T systems suffer an event, while also keeping a master copy of his data onsite in the Whitewater appliance.
"Whitewater Accelerators optimize and deduplicate data, so that keeps my costs down in a pay-as-you-go cloud model," said Rountree. "Backup times have been cut in half, and we have entirely eliminated the practice of having to stage backups on disk before sending them to tape. In fact, we have no more need to truck backup tapes offsite."
7. Cloud Philosophy ~ The cloud has even given rise to high-flown philosophizing about how it can change the world. Michael Schrage, research fellow at MIT Sloan School's Center for Digital Business said, "The cloud is the greatest medium for rapid multi-modal experimentation and test in the history for the world."
What he's talking about is the future of the agile infrastructure. Many organizations, he said, decline to ask fundamental questions about the business they are in and the value they provide. Just being a technology company, for example, is not enough. He said that infrastructure has a very bad brand -- regarded as overhead. IT has to get away from that, and he pushes the cloud heavily as the best approach. But he cautioned that many in IT, by retaining old beliefs in centralized IT, were under threat by the cloud.
"Business managers who have had trouble getting IT to experiment and test things out, are going to the cloud to do it themselves," said Schrage.
Due to the explosion in data volumes, he thinks R&D is gradually becoming E&S (experiment and scale).
"Storage and IT owns scaling, so why not adopt the experimental side?" said Schrage. "Instead of being in the back office, you could move to the front line."
The big inflection point is to do it with internal IT or with the cloud. It is up to IT if it resists this movement and seeks to live within a data center silo, he said, or adopts the cloud and evolves into this new role. Otherwise, outfits like Amazon could well see themselves taking over more and more of the storage role via online services.
Drew Robb is a freelance writer specializing in technology and engineering. Currently living in California, he is originally from Scotland, where he received a degree in geology and geography from the University of Strathclyde. He is the author of Server Disk Management in a Windows Environment (CRC Press).