The Realities of the Public Cloud

By Jyeh Gan, Director of Product Management and Strategy, Dell Extreme Scale Infrastructure (ESI)

Jyeh Gan, Director of Product Management and Strategy, Dell Extreme Scale Infrastructure (ESI)

Considerations for Today’s CIOs

Cloudy with a Chance of Misfortune

Today’s CIOs are often asked to evaluate internal IT offerings against operating in a public cloud. While the rise of the public cloud has certainly provided advantages for many situations, the vast majority of enterprises are still typically better served with a hybrid IT approach that provides the best of both worlds in terms of security, cost-effectiveness, performance, and regulatory compliance.

"Public clouds can certainly offer benefits in standing up new offerings quickly, piloting projects ahead of full-scale roll-outs, and adding burst capacity for existing operations"

When starting conversations around cloud deployments, the first thing we discuss with our customers is how appropriate their workloads are to the nature and limitations of the public cloud. While cloud-native applications are becoming very popular for new development projects, most IT today still supports core business operations like email, customer databases, employee files, and other proprietary data that can be risky to store in a public environment, even when fully encrypted.

Public cloud providers can also act as a sort of gatekeeper on innovation, security, and performance. This can hamper a business’ ability to differentiate itself from its competitors, outweighing the capital expense savings and simplicity that often draw businesses to the public cloud in the first place.

In fact, that very simplicity can be a double-edged sword for many companies, as it fosters the continued rise of ‘shadow IT’. Shadow IT, or resources existing outside of the ‘known’, grew out of control during the bring-your-own-device (BYOD) era of the past several years and most CIOs certainly want to avoid a repeat of that in their own organizations today.

Hastily-created public cloud projects typically also don’t follow existing business protocols around privacy or security, especially in an increasingly globalized marketplace. So that simple swipe of a credit card by a developer or marketing operations employee can open your business up to regulatory lawsuits and unforeseen operational costs, among a host of other issues, if you’re not careful about how you approach the public cloud.

Finding the Silver Lining of Enterprise Hybrid Clouds

Having worked closely with major cloud service providers to optimize their own infrastructure for most of the past decade, Dell Extreme Scale Infrastructure (ESI) has developed a set of considerations that CIOs should carefully evaluate as they map out their own future-ready IT strategy.

First, consider how much product innovation underlies your business value. Do you typically lead your industry in the use of key technologies? If you need access to customized or high-performance tools and applications, the public cloud may not be an ideal solution as it typically lags the leading edge (often by months or even years) and also adds a layer of complexity and latency to many operations.

Second, are the workloads you’re looking at bringing to the public cloud appropriate for use there? Applications under heavy load can be more costly to operate in a public cloud than on your own equipment, whether you run it on-premises or in a hosted location. While cloud-native applications can certainly drive business value when implemented properly, operating all of your IT inside the public cloud can be risky and often more expensive in the long run. Just as with buying a house versus renting one, you often end up paying more for the convenience of avoiding up-front capital expenses over the long run.

Third, how global are your operations and how portable is your data? Recent decisions like the invalidation of the Safe Harbor provisions between the US and the European Union shine increasing light on the need for mindful regulatory compliance around data privacy and security. Public cloud customers were previously shielded from these issues because data could live and move freely around the globe in most cases. But with countries exerting increasing oversight around their own citizens’ data and its privacy impacts, the panacea of global data availability is now under assault.

To avoid these issues, many enterprises we work with are returning to operating their own data centers in the countries they serve as it allows them to meet unique regulatory requirements and better control their own destinies in these countries. In addition, they are often seeing how innovations in their own IT operations can further set them apart from their competitors in ways that aren’t possible in the ‘common denominator’ world of the public cloud.

Lastly, companies should evaluate the ability of cloud providers to operate effectively on a global scale in terms of support and reliability. Though public cloud operations are often assumed to reach every corner of the globe equally, this is typically not the case.

Public clouds can certainly offer benefits in standing up new offerings quickly, piloting projects ahead of full-scale roll-outs, and adding burst capacity for existing operations. They can also facilitate building a presence in far-flung areas where a business case for private data centers may not make sense yet due to unknown costs or limited consumer demand in the region. As with any CIO decision, those benefits should be weighed against any inherent risks and evaluated carefully.

Building a Future-ready Hybrid IT Strategy

The public cloud has brought a wealth of new opportunities to the world of enterprise IT. Having a front-row seat to much of the development of cloud-native applications and the infrastructure behind them, we have seen first-hand the many ways companies have succeeded and failed in their journeys with both public and private clouds.

Every one of our customers today is seeking greater agility and efficiency in their IT operations and the public cloud is clearly a part of that equation. But assuming that the public cloud is a solution to every IT problem is a recipe for disaster. If you’re looking to implement truly future-ready solutions for today’s IT challenges, you should carefully consider what parts of operations are best served by what architectures.

Looking at how technology innovation plays a role in your business, how well your applications actually fit the public cloud model, and how you will handle data privacy and global support are key factors in how much of your IT investment should be put into the public cloud versus your own on-premises or hosted private clouds.

Build with a clear vision of your own future needs and keep your eyes focused on ever-evolving clouds on the horizon.

SIDEBARDell State of IT Trends 2016 Global Study

• ITDMs (62 percent) and BDMs (51 percent) agree that cloud computing is the most important technology trend for their companies.
o The ability to burst to public cloud as needed is important to both ITDMs (83 percent) and BDMs (74 percent)
o In terms of technology spending for 2016, cloud is the main priority among both ITDMs (67 percent) and BDMs (59 percent).
• Eighty-eight percent of ITDMs and 80 percent of BDMs say their organization is considering adopting a software-defined data center (SDDC), is in the process of transitioning, or has already completed the transition to one.
o Both groups agree the benefits of SDDC are flexibility, simplicity, efficiency and cost-savings, although ITDMs also place a greater value on increased scalability (57 percent) than BDMs (40 percent).
• Eight out of 10 respondents agree that a compute-centric approach to data center solution development is key in driving innovation.

This Dell-sponsored research performed was by PSB, which conducted 1,200 online interviews between April 15 and May 4, 2016, in the U.S., U.K., Germany, Japan, Brazil, India and China.

Of the audience, 700 respondents were IT Decision Makers (ITDMs) and 500 were Business Decision Makers (BDMs).