At our Q1 Innovation Club, with a select group of global CIOs, we discussed the topic of public cloud computing in the enterprise. At EnVirtual it seems to us that the impact and pace of technology innovation, driven by consumer computing, software as a service, and cloud infrastructure, will be truly transformative for enterprise IT.

What’s the best way to leverage the emergence of the massively scaled technology ecosystems (from Amazon, Google, Microsoft, Apple, and others) that provision both server and client compute power with service levels and price performance ratios that few enterprises can match?

Total investment in real and virtual revenue-generating IT assets Ref.  Gartner analyst Lydia Leong 2013

Andrew Mendoza, Strategy

Q1: Is the $50 billion investment in public cloud a driver of change or just business as usual?

Q2: Does public cloud help more in the front, middle, or back office?

The discussion included:

  • Change management and process re-design are constants
  • In established businesses its ‘business as usual’, just a new sourcing option
  • New entrants can move faster and ‘may’ threaten established businesses
  • Maintaining data integrity across solutions is a big issue for SaaS
  • Concentration of suppliers, all non-European, is a pricing power & security risk
  • Media industry 100% in the public cloud soon; manufacturing perhaps never
  • Custom software is a new differentiator, developers start with public cloud

Matthew Jolliffe, Architecture

Q3: What enterprise architecture and governance processes change for public cloud and SaaS?

Q4: Is public cloud more or less secure than your own infrastructure?

The discussion included:

  • Governance, in principle, remains the same

  • Non-IT department buyers now need to be included in governance to control the Enterprise Architecture and data integrity over the long term

  • Public clouds seem secure, however they are certainly not transparent and their service agreements make no security or data leakage guarantees

  • Enterprise SaaS providers, like salesforce, reserve the right to use public cloud for provision of services, this represents a security and data risk

Adrian Butter, Software

Q5: Will you mandate that software suppliers develop in the public cloud for scale and performance?

The discussion included:

  • Public cloud under the covers potentially represents a risk (see Architecture)
  • However, ERP badly needs more competition with real SaaS pay per use and pay per feature  pricing models
  • Barriers to change in niche vertical industry specific applications seems the same in cloud - i.e. the market size may still be small for niche verticals and a deterrent to innovation