For the last 20 years, I have focused on designing, developing and implementing world-class finance, process and technology solutions for clients ranging from Mom & Pop Start-ups to Fortune 500 corporations. What I have recognized during this time is that regardless of the organizations size and focus, issues and opportunities seem to be pretty consistent. This blog focuses on the good, the bad, and the ugly of what our clients face on a day to day basis.
IS YOUR HEAD IN THE CLOUDS?
As the economy remains sluggish, many of our clients are looking for ways to cut costs. In recent months, I have been asked on more than one occasion to give my thoughts on the virtues of Cloud Computing. Software vendors are making the rounds presenting “Value Added” cloud-based computing solutions that they maintain will drive significant savings. The first question though is, “What is Cloud Computing?” This is a great question as you may receive different answers depending upon whom you ask! I side with Gartner. Gartner takes the position that Cloud Computing as “a style of computing in which massively scalable IT-related capabilities are provided “as a service” using Internet technologies to multiple external customers.”
Hmmm, let’s think about this for a second. The opportunity to transfer all of the day to day IT support problems and cost sounds enticing. The idea of reducing the need for hardware also sounds great. The idea of reducing internal IT headcount (while difficult) also provides some bottom line pick-up. However, I say to you: “Measure Twice, Cut Once!”
In certain cases, Cloud Computing offers some significant advantages. However, it is critical that you fully understand what the new environment entails from a people, process and technology perspective. To gain this understanding, you should ask many questions and check several references to make sure that Cloud Computing (and the firm providing it) meets or exceeds your requirements.
At a minimum, you should get a detailed understanding of the following:
- Does the functionality meet or exceed your core / critical requirements?
- Is the cost structure truly lower than what you have today?
- Are the savings presented by the vendor realistic?
- What is the commitment to application availability (uptime) and system response time?
- Are there Service Level Agreements (SLA’s) outlining the vendors support requirements? Is there financial consideration should the vendor not meet these SLA’s?
- Are the application, data tables, and hardware secure?
- Is the vendor financially solvent?
- Does the vendor have a feasible disaster recovery / business continuity program?
- Is the vendor willing to allow for configuration changes / customization to support your business requirements? If so, at what cost?
I do believe that there is a time, place and use for Cloud Computing; however, make sure that you fully understand the specifics of the environment prior to moving forward. Again, measure twice, cut once!
Mark T. Warren, MS
Director of Business Consulting
Gorfine, Schiller & Gardyn, PA
Mark Warren has over 20 years experience in business consulting, including business performance management, contract management and strategic sourcing. He works with clients of all sizes in Baltimore, Maryland and throughout the Mid-Atlantic.