Business Drivers

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Business Drivers

Business Drivers

Before delving into the layers of technologies that underlie clouds, the motivations that led to their creation by industry leaders must first be understood. Several of the primary business drivers that fostered modern cloud-based technology are presented in this section.

The origins and inspirations of many of the characteristics, models, and mechanisms covered throughout subsequent chapters can be traced back to the upcoming business drivers. It is important to note that these influences shaped clouds and the overall cloud computing market from both ends. They have motivated organizations to adopt cloud computing in support of their business automation requirements. They have correspondingly

motivated other organizations to become providers of cloud environments and cloud technology vendors in order to create and meet the demand to fulfill consumer needs.

Capacity Planning

Capacity planning is the process of determining and fulfilling future demands of an organization’s IT resources, products, and services. Within this context, capacity represents the maximum amount of work that an IT resource is capable of delivering in a given period of time. A discrepancy between the capacity of an IT resource and its demand can result in a system becoming either inefficient (over-provisioning) or unable to fulfill user needs (under-provisioning). Capacity planning is focused on minimizing this discrepancy to achieve predictable efficiency and performance.

Different capacity planning strategies exist:

  • Lead Strategy – adding capacity to an IT resource in anticipation of demand
  • Lag Strategy – adding capacity when the IT resource reaches its full capacity
  • Match Strategy – adding IT resource capacity in small increments, as demand increases

Planning for capacity can be challenging because it requires estimating usage load fluctuations. There is a constant need to balance peak usage requirements without unnecessary over-expenditure on infrastructure. An example is outfitting IT infrastructure to accommodate maximum usage loads which can impose unreasonable financial investments. In such cases, moderating investments can result in under-provisioning, leading to transaction losses and other usage limitations from lowered usage thresholds.

Cost Reduction

A direct alignment between IT costs and business performance can be difficult to maintain. The growth of IT environments often corresponds to the assessment of their maximum usage requirements. This can make the support of new and expanded business automations an ever-increasing investment. Much of this required investment is funneled into infrastructure expansion because the usage potential of a given automation solution will always be limited by the processing power of its underlying infrastructure.

Two costs need to be accounted for: the cost of acquiring new infrastructure, and the cost of its ongoing ownership. Operational overhead represents a considerable share of IT budgets, often exceeding up-front investment costs.

Common forms of infrastructure-related operating overhead include the following:

  • technical personnel required to keep the environment operational
  • upgrades and patches that introduce additional testing and deployment cycles
  • utility bills and capital expense investments for power and cooling
  • security and access control measures that need to be maintained and enforced to protect infrastructure resources
  • administrative and accounts staff that may be required to keep track of licenses and support arrangements

The on-going ownership of internal technology infrastructure can encompass burdensome responsibilities that impose compound impacts on corporate budgets. An IT department can consequently become a significant-and at times overwhelming-drain on the business, potentially inhibiting its responsiveness, profitability, and overall evolution.

Organizational Agility

Businesses need the ability to adapt and evolve to successfully face change caused by both internal and external factors. Organizational agility is the measure of an organization’s responsiveness to change.

An IT enterprise often needs to respond to business change by scaling its IT resources beyond the scope of what was previously predicted or planned for. For example, infrastructure may be subject to limitations that prevent the organization from responding to usage fluctuations-even when anticipated-if previous capacity planning efforts were restricted by inadequate budgets.

In other cases, changing business needs and priorities may require IT resources to be more available and reliable than before. Even if sufficient infrastructure is in place for an organization to support anticipated usage volumes, the nature of the usage may generate runtime exceptions that bring down hosting servers. Due to a lack of reliability controls within the infrastructure, responsiveness to consumer or customer requirements may be reduced to a point whereby a business’ overall continuity is threatened.

On a broader scale, the up-front investments and infrastructure ownership costs that are required to enable new or expanded business automation solutions may themselves be prohibitive enough for a business to settle for IT infrastructure of less-than-ideal quality, thereby decreasing its ability to meet real-world requirements.

Worse yet, the business may decide against proceeding with an automation solution altogether upon review of its infrastructure budget, because it simply cannot afford to. This form of inability to respond can inhibit an organization from keeping up with market demands, competitive pressures, and its own strategic business goals.