Contracting for Cloud Services A 6-Step “How-To” Guide to Contracting for Cloud Services Includes a 137-Element Contracting Checklist
Ron Scruggs, Thomas Trappler, & Don Philpott
Published by
ISBN: 978-1-937246-67-9
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About the Publisher – Government Training Inc.™ Government Training Inc. provides worldwide training, publishing and consulting to government agencies and contractors that support government in areas of business and financial management, acquisition and contracting, physical and cyber security and intelligence operations. Our management team and instructors are seasoned executives with demonstrated experience in areas of Federal, State, Local and DoD needs and mandates. For more information on the company, its publications and professional training, go to www.GovernmentTrainingInc.com. Copyright © 2011 Government Training Inc. All rights reserved. Printed in the United States of America. This publication is protected by copyright, and permission must be obtained from the publisher prior to any prohibited reproduction, storage in a retrieval system or transmission in any form or by any means, electronic, mechanical, photocopying, recording or likewise. For information regarding permissions, write to: Government Training Inc. Rights and Contracts Department 5372 Sandhamn Place Longboat Key, Florida 34228
[email protected] ISBN: 978-1-937246-67-9 Sources: This book has drawn heavily on the authoritative materials published by a wide range of sources. These materials are in the public domain, but accreditation has been given both in the text and in the reference section if you need additional information. The author and publisher have taken great care in the preparation of this handbook, but make no expressed or implied warranty of any kind and assume no responsibility for errors or omissions. No liability is assumed for incidental or consequential damages in connection with or arising out of the use of the information or recommendations contained herein.
Agency/Business Management For more information on the company, its publications and professional training, go to http://www.governmenttraininginc.com
Delivering Your Message with PowerPoint Highly Effective Communications for Government & Corporate Managers PowerPoint presentations can be an enormously effective communications tool— provided you follow some basic rules. These rules are spelled out in “Delivering Your Message with PowerPoint,” written by Dave Paradi, a proven expert and sought-after speaker at all levels of government and corporations. The book is crammed with examples—good and bad—best practices, and checklists to ensure your presentation is a success.
Developing the Positive, Healthy & Safe Workplace A 7-Step Management Process Leading to a Culture of Personnel Safety & Security Rita Rizzo is a nationally recognized expert on all aspects of workplace quality, employee development, leadership and workplace security. Her thoughtprovoking seminars and books have brought practical solutions to the challenges of leadership. In the book, Rita presents a 7-step process for use by management and staff to create a positive, healthy, and safe workplace.
Telework: How to Telecommute Successfully A 5-Step Guide Designed for the Modern Teleworker Millions of people go to work every day without ever leaving their homes. They are part of a growing army of teleworkers in both the private and public sector. If you think you can do your job from home without being distracted, then teleworking could be right for you—and it is certainly worth considering. The book spells out all the positives—and the negatives—and with the use of checklists and questionnaires will help you succeed as a teleworker.
Agency/Business Management For more information on the company, its publications and professional training, go to http://www.governmenttraininginc.com
How To Get Others To Do What You Want Them To Do (Or... Never Kick a Kangaroo!) Wouldn’t it be great if you always got your way in negotiations and never lost another argument? We all have the tools to achieve this, but most of us don’t know how to use them. That is what How To Get Others To Do What You Want Them To Do (Or… Never Kick a Kangaroo!) is all about. It may be a strange title, but you should never get into a kick-boxing fight with a kangaroo—you would lose. In order to be successful you must understand the other participants —what they want, and the tools they use. You can then pick the tools and techniques that will work in your favor.
Executive Briefings & Presentations Best Practices Handbook A Step-by-Step Process and Guide to Making Powerful Presentations to Colleagues and the Press The book will teaches you how you to develop a plan so that you will know what to do, what to say, and how best to say it in any situation. These techniques will support you whenever you need to communicate—whether it is in the office, or in front of millions of people during a live television interview.
GovCloud: Cloud Computing for the Business of Government A 5-Step Process to Evaluate, Design and Implement a Robust Cloud Solution The book describes the key characteristics of cloud computing and various deployment and delivery models. It contains case studies and best practices, how to set and meet goals, guidelines for developing a robust business case analysis, how to implement and use cloud computing, and how to make sure it is performing well for your organization.
Agency/Business Management For more information on the company, its publications and professional training, go to http://www.governmenttraininginc.com
Handbook for Managing Teleworkers A 5-Step Management Process for Managing Teleworkers The book is an A-Z guide aimed at managers tasked with introducing teleworking, or overseeing teleworkers and ensuring that everything runs smoothly. The rules for managing teleworking are the same whether you are a federal or state employee, or work for a private company or organization. The book is also very useful to people who are considering teleworking, or trying to persuade their employer to introduce it.
Handbook for Managing Teleworkers – Toolkit The handbook discusses all the arguments that have been put forward against teleworking and then debunks them using the latest surveys and case studies. There are chapters on problems and how to overcome them, how to motivate through counseling and coaching, and developing trust. It is an invaluable resource for all telework managers and those who might be tasked with taking on this responsibility. An essential companion guide to Government Training Inc.’s Handbook for Managing Teleworkers.
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Acknowledgements This handbook has drawn heavily on authoritative materials published by many federal agencies and especially the Department of Defense (DoD), General Services Administration (GSA) and the Government Accountability Office (GAO). These materials are in the public domain, but accreditation has been given either in the text or in the reference section at the end of the book if you need additional information.
Disclaimer Our aim is to provide a comprehensive framework that will allow you to understand the challenges of cloud computing, how to define procurement vehicles, processes and how to build and finalize a contract, as well as how to manage that contract. However, this book is a guide only and contains references should you need more detailed information on particular subjects. This book is not a legal handbook. “Example” clauses are given throughout this book, but before preparing a contract you must seek legal counsel. Also, if you have detailed legal questions seek the advice of an appropriate legal expert.
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About the authors Ron Scruggs Ron Scruggs, Certified Technology Procurement Executive, has a distinguished career in sourcing, purchasing and contract management. He started his career in Washington, D.C., negotiating and managing federal government contracts in the 1960s. He also knows the international market well, having spent more than 20 years as Director of Contracts in Europe. Most recently he has co-developed the original Contracting in the Cloud seminar based on his experience since the early 2000s before the name “cloud” was attached to these services. Ron has assisted companies with IT and Business Process Outsourcing, Cloud Services, software development, software licensing, and Website development and other projects. He has negotiated dozens of Cloud Services agreements and developed a number of Cloud SaaS template agreements for clients. Additionally, Ron has developed software agreements for vendors, as well as customers, leading to an edge by knowing the vendors’ reasons for their terms and conditions while also understanding the customer needs. Acting as a consultant for a number of Fortune 500 and other companies, he has saved these companies millions of dollars while achieving better terms. On a single software deal, he saved $50 million for one of his clients. As manager of Strategic Alliances for Digital and Bay Networks, he negotiated major purchases, such as personal computers ($40 million a year) and software alliances with Microsoft, Olivetti and other major firms. He also spent 20 years working as Director of Contracts for Digital and Bay Networks. Ron has developed and taught courses to include Negotiation Success, Resolving Software Business Issues, Export Control Issues and Solutions, Open Software Dynamics and Procurement Management including Purchasing, Legal, Technical and Finance and Contract Management subjects. Ron has a BA and MBA and has also completed post-graduate courses with INSEAD in France, the Institute of Business Methods (IMEDE) in Switzerland and the Swedish Institute of Management. His published articles include: “Get Better Deals by Listening,” “Effective SOW Writing,” “Cloudy SLAs,” and “What Vendors Do Not Want You To Know About Escrow.” Ron lives in Florida with his wife of 45 years and his pet, Benji. He still consults and teaches IT procurement issues. Thomas Trappler Thomas Trappler (www.thomastrappler.com) is Director of Software Licensing at the University of California, Los Angeles (UCLA), and has extensive experience leading enterprise-wide IT procurement and vendor-management initiatives and negotiations focused on cost reduction and risk mitigation, with an emphasis on cloud computing contracts and software license agreements. www.GTIBookstore.com
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Elected the inaugural Chair of the University of California (UC) system-wide Technology Acquisition Support Group, Thomas has led the investigation, implementation and ongoing vendor management for more than 30 enterprise-wide IT acquisition agreements. These agreements provide 188,000 licenses to 228 operational units in a decentralized enterprise and have resulted in savings of $7.5 million/year. Additionally, Thomas is the lead author and project manager for initiatives to develop UC-wide standard software license agreement and cloud computing contract templates. Dubbed “The Cloud Contract Advisor” by Computerworld magazine, Thomas is a nationally recognized expert and published author in cloud computing risk mitigation via contract negotiation and vendor management. He has been a guest lecturer at the Polytechnic Institute of New York University, and developed and teaches “Contracting in the Cloud,” the original seminar focused on the unique issues associated with the acquisition and management of cloud computing services. Thomas is currently working with the Cloud Security Alliance as the lead author and project manager on an initiative to establish a standard cloud computing contract checklist. His presentations and publications include: Cloud Expo West 2011, presentation, Cloud Computing Contract Issues, November 7, 2011; Educause 2011, presentation, Managing Cloud Security Risks Through the Right Partnerships, October 19, 2011; Computerworld, column, The Cloud Contract Adviser, ongoing; The Business of Cloud Computing Conference, pre-conference workshop, “Due Diligence and Cloud Service Agreements,” June 13, 2011; Security Professionals 2011, presentation, If It’s in the Cloud, Get It on Paper: Cloud Computing Contract Issues, April 6, 2011; Educause West/Southwest Conference 2011, presentation, If It’s in the Cloud, Get It on Paper: Cloud Computing Contract Issues, February 23, 2011; EDUCAUSE Live!, webinar, Spotlight on Cloud Computing, December 10, 2010; Educause 2010, discussion session, Cloud Computing Contract Issues, October 14, 2010; Educause Quarterly, article, If It’s in the Cloud, Get It on Paper: Cloud Computing Contract Issues, Volume 33, Number 2, 2010; Educause Quarterly, article, Is There Such a Thing as Free Software? The Pros and Cons of Open Source Software, Volume 32, Number 2, 2009. Don Philpott Don Philpott is editor of International Homeland Security Journal and has been writing, reporting and broadcasting on international events, trouble spots and major news stories for almost 40 years. For 20 years he was a senior correspondent with Press Association-Reuters, the wire service, and traveled the world on assignments including Northern Ireland, Lebanon, Israel, South Africa and Asia. He writes for magazines, and newspapers in the United States and Europe, and is a regular contributor to radio and television programs on security and other issues. He is the author of more than 100 books on a wide range of subjects and has had more than 5,000 articles printed in publications around the world. His most recent books are Handbooks for COTRs, Performance Based Contracting, Cost Reimbursable Contracting, How to Manage Teleworkers, Crisis Communications and Integrated Physical Security Handbook II. He is a member of the National Press Club.
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Contents Acknowledgements ..................................................................................................................................... vii Disclaimer ................................................................................................................................................... vii Step 1. Understanding Cloud Computing ...................................................................................................1 Why it is Called Cloud Computing? ...............................................................................................................1 Key Cloud Computing Benefits ......................................................................................................................4 Challenges of Cloud Computing ..................................................................................................................10 PaaS Issues .................................................................................................................................................22 Step 2. Understanding The Federal Government’s New Approach To Cloud Computing .........................23 Cloud First ..................................................................................................................................................23 President’s Cyber Policy ...............................................................................................................................25 Federal CIO Statements ...............................................................................................................................28 Cybersecurity Gets a Boost ..........................................................................................................................28 IT Reform Push, Nine Months After ‘Cloud First’ Introduction........................................................................41 GSA is in the Cloud .....................................................................................................................................47 Step 3. Identifying/Determining Your Needs ............................................................................................59 Provision of Selected IT Services ..................................................................................................................61 Successful Move to the Cloud Requires Agency Introspection First ................................................................74 Focus/Roadmap ..........................................................................................................................................85 Pricing Billing Terms ....................................................................................................................................85 Step 4. Defining Potential Procurement Vehicles and Processes .............................................................91 Contracts and RFPs .....................................................................................................................................91 How do you Gather Information on Cloud Services? .....................................................................................91 Customer References...................................................................................................................................93 A Process For Acquiring Cloud Computing Services ......................................................................................93 Developing a Performance-Based Work Statement .....................................................................................110 Other Agencies’ Cloud Implementations ....................................................................................................135 Step 5. Building and Finalizing a Contract .............................................................................................139 Infrastructure/Security ...............................................................................................................................139 Information Security ..................................................................................................................................153 Operations Management ...........................................................................................................................158 Third-Party Certifications ...........................................................................................................................160 Customer Data Center Inspection Rights ....................................................................................................163 Performance Reporting ..............................................................................................................................164 Location of Data .......................................................................................................................................172 Data Protection, Access, Location – Questions............................................................................................176 Fees/Payments ..........................................................................................................................................177 Terms and Conditions Online .....................................................................................................................191 Storage Limits/Fees ...................................................................................................................................191 Technical Support ......................................................................................................................................192 SaaS, Security, the Cloud and the Contract .................................................................................................192
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Step 6. Managing The Contract and The Vendor Relationship ...............................................................213 Contract Administration.............................................................................................................................213 Overcoming Weaknesses ...........................................................................................................................215 Contracting Officer’s Technical Representative (COTR) ................................................................................216 Voucher/Invoice Review, Approval and Processing ......................................................................................221 Re-certification/Re-inspection ....................................................................................................................227 SLA/KPI Monitoring ...................................................................................................................................227 Vendor Continued Viability – Proactively Monitor .......................................................................................228 Payment for Performance...........................................................................................................................229 Compliance...............................................................................................................................................229 Relationship Advice for Contract Managers ................................................................................................229 Conclusion ................................................................................................................................................230
Notice: Appendices & Blank Forms are available online. To access additional materials, visit our website at www.GovernmentTrainingInc.com, go to the Books section of the website, and click on Contracting for Cloud Services. In the Reference Library Login area of the page, use the following credentials to login: Username: GTI246679 Password: 10119781 This username and password are assigned to you, the purchaser. You will need to enter your email address when logging in so that we can verify each visitor. This information is for the use of the purchaser only and not to be distributed to anyone except the purchaser.
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Symbols Throughout this book you will see a number of icons displayed. The icons are there to help you as you work through the Six Step process. Each icon acts as an advisory – for instance alerting you to things that you must always do or should never do. The icons used are:
This is something that you must always do
This is something you should never do
Really useful tips
Points to bear in mind
Have you checked off or answered everything on this list?
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STEP 1
Understanding Cloud Computing
Cloud computing describes a broad movement to treat IT services as a commodity with the ability to dynamically increase or decrease capacity to match usage needs. By leveraging shared infrastructure and economies of scale, cloud computing presents organizational leadership with a compelling business model. It allows users to control the computing services they access, while sharing the investment in the underlying IT resources among consumers. When the computing resources are provided by another organization over a wide-area network, cloud computing is similar to an electric power utility. The providers benefit from economies of scale, which in turn enables them to lower individual usage costs and centralize infrastructure costs. Users pay for what they consume, can increase or decrease their usage, and leverage the shared underlying resources. With a cloud computing approach, a cloud customer can spend less time managing complex IT resources and more time investing in core mission work.
Why it is Called Cloud Computing? The term “cloud” is used as a metaphor for the Internet, based on the cloud drawing used in the past to represent the telephone network, and later to depict the Internet in computer network diagrams as an abstraction of the underlying infrastructure it represents.
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“It comes from the early days of the Internet where we drew the network as a cloud… we didn’t care where the messages went… the cloud hid it from us.” – Kevin Marks, Google
NIST Provides a Formal Definition for Cloud Computing Cloud computing is defined by the National Institute of Standards and Technology (NIST) as “a model for enabling ubiquitous, convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. This cloud model promotes availability and is composed of five essential characteristics, three service models and four deployment models.”
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Step 1. Understanding Cloud Computing Five Characteristics
On-demand self-service. A consumer can unilaterally provision computing capabilities, such as server time and network storage, as needed automatically without requiring human interaction with each service’s provider. Broad network access. Capabilities are available over the network and accessed through standard mechanisms that promote use by heterogeneous thin or thick client platforms (e.g., mobile phones, laptops and PDAs). Resource pooling. The provider’s computing resources are pooled to serve multiple consumers using a multi-tenant model, with different physical and virtual resources dynamically assigned and reassigned according to consumer demand. There is a sense of location independence in that the customer generally has no control or knowledge over the exact location of the provided resources but may be able to specify location at a higher level of abstraction (e.g., country, state or datacenter). Examples of resources include storage, processing, memory, network bandwidth and virtual machines. Rapid elasticity. Capabilities can be rapidly and elastically provisioned, in some cases automatically, to quickly scale out, and rapidly released to quickly scale in. To the consumer, the capabilities available for provisioning often appear to be unlimited and can be purchased in any quantity at any time. Measured Service. Cloud systems automatically control and optimize resource use by leveraging a metering capability at some level of abstraction appropriate to the type of service (e.g., storage, processing, bandwidth and active user accounts). Resource usage can be monitored, controlled and reported, providing transparency for both the provider and consumer of the utilized service. Three Service Models The NIST definition categorizes cloud computing into three service models: Cloud Software as a Service (SaaS).The capability provided to the consumer is to use the provider’s applications running on a cloud infrastructure. The applications are accessible from various client devices through a thin client interface, such as a Web browser (e.g., Web-based email). The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, storage or even individual application capabilities, with the possible exception of limited user-specific application configuration settings.
Examples: Google, NetSuite, RightNow, Salesforce, Service-Now, SuccessFactors, Taleo and Workday.
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Cloud Platform as a Service (PaaS). The capability provided to the consumer is the ability to deploy onto the cloud infrastructure consumer-created or acquired applications created using programming languages and tools supported by the provider. The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems or storage, but has control over the deployed applications and possibly application hosting environment configurations.
Examples: Google App Engine, Salesforce.com’s Success on Demand, Engine Yard and Azure.
Cloud Infrastructure as a Service (IaaS).The capability provided to the consumer is to provision processing, storage, networks and other fundamental computing resources where the consumer is able to deploy and run arbitrary software, which can include operating systems and applications. The consumer does not manage or control the underlying cloud infrastructure but has control over operating systems, storage and deployed applications, and possibly limited control of select networking components (e.g., host firewalls).
Examples: Amazon Web Services (EC2, S3 etc.), ENKI, GoGrid,Logicworks, OpSource, Rackspace, SAVVIS (acquired by CenturyLink) and Terremark.
Four Deployment Models The NIST definition of cloud computing includes four deployment models, each of which provides distinct trade-offs for agencies which are migrating applications to a cloud environment. Public cloud. The cloud infrastructure is made available to the general public or a large industry group and is owned by an organization selling cloud services. Private cloud. The cloud infrastructure is operated solely for an organization. It may be managed by the organization or a third party and may exist on premise or off premise. Community cloud. The cloud infrastructure is shared by several organizations and supports a specific community that has shared concerns (e.g., mission, security requirements, and policy and compliance considerations). It may be managed by the organizations or a third party and may exist on premise or off premise. Hybrid cloud. The cloud infrastructure is a composition of two or more clouds (private, community or public) that remain unique entities, but are bound together by standardized or proprietary technology that enables data and application portability (e.g., cloud bursting for load-balancing between clouds).
Key Cloud Computing Benefits A number of government agencies are adopting cloud technologies and are realizing considerable benefits. For instance, NASA Nebula, through a community cloud, gives researchers access to IT services relatively inexpensively in minutes. Prior to adopting this approach, it would take researchers months to procure and configure comparable IT resources and significant management oversight to monitor and upgrade systems. Applying cloud technologies across the entire federal government can yield benefits such as:
Step 1. Understanding Cloud Computing
Cost Reduction
Scalability
Automatic Updates
Remote/Mobile Access
Increased Reliability
Rapid Deployment/Easy Implementation
Access to Higher Level IT Resources
Green IT
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Cost Reduction
You only pay for what you use, as you use it.
Hardware, software and IT staff expense reductions.
Additional reduced costs from energy and real estate.
In FY2010, approximately 30 cents of every dollar invested in Federal IT was spent on data center infrastructure. Unfortunately, only a fraction of this investment delivers real, measurable impact for American citizens. By using the cloud computing model for IT services, the federal government will be able to reduce its data center infrastructure expenditure by approximately 30 percent (which contributes to the estimated $20 billion of IT spending that could be migrated to cloud computing solutions). Similar efficiency improvements will be seen in software applications and end-user support.
Tip As utilization is improved, more value is derived from the existing assets, reducing the need to continuously increase capacity. Fewer machines mean less spending on hardware, software and operations maintenance, and real estate and power consumption.
These savings can be used to increase capacity or be reinvested in agency missions, including citizen-facing services and inventing and deploying new innovations. Cloud computing can allow IT organizations to simplify, as they no longer have to maintain complex, heterogeneous technology environments. Focus will shift from the technology itself to the core competencies and mission of the agency.
Across the public and private sectors, data center infrastructure investments are not utilized to their fullest potential. For example, according to a recent survey, many agencies are not fully utilizing their available storage capacity and are utilizing less than 30 percent of their available server capacity. Low utilization is not necessarily a consequence of poor management, but, instead, a result of the need to ensure that there is reserve capacity to meet periodic or unexpected demand for key functions. With cloud computing, IT infrastructure resources are pooled and shared across large numbers of applications and organizations. Cloud computing can complement data center consolidation efforts www.GTIBookstore.com
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by shifting workloads and applications to infrastructures owned and operated by third parties. Capacity can be provisioned to address the peak demand across a group of applications, rather than for a single application. When demand is aggregated in this fashion and properly managed, the peaks and troughs of demand smooth out, providing a more consistent and manageable demand profile. The shift to cloud computing can help to mitigate the fragmented data, application and infrastructure silo issues associated with federated organizational and funding models by focusing on IT services as a utility. IT services become candidates for more cost-effective procurement and management, similar to the model currently used for buildings and utility services. Cloud computing has the potential to provide a more interoperable and portable environment for data and systems. With the appropriate standards, over time, organizations may be able to move to common services and platforms. Cloud computing can accelerate data center consolidation efforts by reducing the number of applications hosted within government-owned data centers. For those that continue to be owned and operated directly by federal agencies (e.g., by implementing private IaaS clouds), environments will be more interoperable and portable, which will decrease data center consolidation and integration costs because it reduces unnecessary heterogeneity and complexity in the IT environment.
Scalability
Easily access resources needed
Start small and increase over time
Facilitate seasonal peak needs
Resources can grow as your needs grow
With traditional infrastructure, IT service reliability is strongly dependent upon an organization’s ability to predict service demand, which is not always possible. For example, the IT system used in the Car Allowance and Rebate System (CARS, more commonly known as “Cash-For-Clunkers”) had numerous failures because the load was considerably higher than what its system could handle. The sponsor for “Cash-for-Clunkers,” the National Highway Traffic Safety Administration (NHTSA) anticipated a demand of 250,000 transactions over a four-month period, but within just 90 days, the system processed approximately 690,000 CARS transactions. Within three days of the first dealer registrations, the system was overwhelmed, leading to numerous outages and service disruptions. The $1 billion appropriated for the Remember program was nearly exhausted within one week, and an additional $2 billion was appropriated to triple the The impact of cloud computing potential number of transactions just nine days after will be far more than economic. the program began. Cloud computing will also allow agencies to improve services and respond to changing needs and regulations much more quickly.
NHTSA deployed a customized commercial application hosted in a traditional data center environment, but the CARS system presented a very good example of an unpredictable service demand and a short devel-
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opment window that could have been more efficiently handled using a cloud computing approach. Cloud computing will allow agencies to rapidly scale up to meet unpredictable demand, thus minimizing similar disruptions. Notably, cloud computing also provides an important option for agencies in meeting short-term computing needs such as the one above; agencies need not invest in infrastructure in cases where service is needed for a limited period of time. With a larger pool of resources to draw from, individual cloud services are unlikely to encounter capacity constraints. As a result, government services, such as “Cash-for-Clunkers,” would be able to more rapidly increase capacity and avoid service outages. Given appropriate service level agreements and governance to ensure overall capacity is met, cloud computing will make the government’s IT investments less sensitive to the uncertainty in demand forecasts for individual programs, which frequently emerge rapidly in response to national program needs which cannot be foreseen in the early stages of the federal budget cycle.
Automatic Updates
With cloud computing, you always have the current version, functionality and patches, because the service is continuously updating in real time.
The result is a reduced need to dedicate your resources to continuously update/patch in-house systems because the cloud vendor does it all for you. This frees up in-house IT staff to focus on core business issues.
This can present a challenge if you don’t want to update. For example, due to lack of integration with in-house systems or lack of training for your end user staff.
Remote/Mobile Access
Employees, partners and clients can access and update files and information wherever they are (as long as there’s an active Internet connection), rather than having to run back to the office.
This increased accessibility can lead to increased productivity for employees that are on the road.
This increased accessibility can lead to increased collaboration. The ease with which a geographically dispersed team can access the same documents makes it easier to work cooperatively on the same project. There is no need for time to be wasted waiting for emailed revisions because every team member can see what is being done by the others in real time.
Increased Reliability
Unless you’re in the business of running data centers or other computing services, this is not likely to be your organization’s core area of expertise, nor should it be.
By moving these processes to the cloud, they’re being run by organizations whose core business is to provide such services, so their expertise in these areas is likely higher than your own, ideally resulting in improved infrastructure security, business continuity and disaster recovery.
An additional benefit is that your in-house resources can be redirected from these areas to focus on differentiating projects related to and supporting your core business. www.GTIBookstore.com
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Rapid Deployment/Easy Implementation Cloud computing also provides an indirect productivity benefit to all services in the IT stack. For example, less effort will be required to stand up and develop software testing environments, enabling application development teams to integrate and test frequently in production-representative environments at a fraction of the cost of providing this infrastructure separately. Cloud-based projects can be conceived, developed and tested with smaller initial investments than traditional IT investments. Rather than laboriously building data center capacity to support a new development environment, capacity can be provisioned in small increments through cloud computing technologies. After the small initial investment is made, the project can be evaluated for additional investment or cancellation. Projects that show promise can gain valuable insights through the evaluation process. Less promising projects can be cancelled with minimal losses. Reducing the minimum required investment size will also provide a more experimental development environment in which innovation can flourish.
This “start small” approach collectively reduces the risk associated with new application development.
The ability to reduce capital investment and transform it into operational expenses is an advantage of cloud computing. Cloud computing can lower the initial cost and reduce the time it takes to deploy new services, and thus can align expense with actual use. Many businesses also prefer OPEX over CAPEX because of tax considerations.
Instead of having to acquire, install and configure a wide range of hardware and software to get a new IT solution up and running (a process often taking months to complete), you just sign up for what you need over the Internet, and access to the service is typically provisioned in a matter of hours.
Business process owner units, in particular, may value the ability to get a solution up and running quickly. The time reduction in their case may also be increased by the ability to by-pass traditional central/corporate IT and/or procurement processes that they may have had to go through in the past. From an overall organization perspective, this may not always be a good thing.
Access to Higher Level IT Resources
Some organizations, especially smaller agencies, may not always be able to afford to acquire the latest technology and/or hire IT staff with the highest level of skills. By moving to a cloud solution, those organizations can have more equal access to such technology and IT staff resources, thus allowing them to compete more effectively with larger organizations. Due to the economies of scale achieved by a cloud vendor, those resources can be provided at a lower cost that doing so in-house.
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Step 1. Understanding Cloud Computing
Additionally a cloud vendor may have expertise in business processes that are needed to keep your business running, but that are not your core business or a key differentiator. For example, Salesforce and CRM, or Workday and payroll/personnel. Moving to a cloud solution could provide you with access to expert systems and resources in those areas, again allowing you to redirect in-house resources to initiatives supporting your core business.
Cloud computing will not only make the federal government’s IT services more efficient and agile, it will also serve as an enabler for innovation. Cloud computing allows the federal government to use its IT investments in a more innovative way and to more easily adopt innovations from the private sector. Cloud computing will also help the federal government’s IT services take advantage of leading-edge technologies including devices such as tablet computers and smart phones.
Green IT
Since a cloud provider’s core business is running data centers, they’re more likely to be able to build and run them in the most energy efficient manner possible (virtualized servers, efficient cooling, building close to renewal energy sources, etc.) than an organization with a different core business. This results in reduced needs to acquire in-house hardware, and reduced energy consumption and carbon footprints, per server.
Organizations with green initiatives may be able to further those initiatives by adopting cloud services. Cloud Benefits: Efficiency, Agility, Innovation Cloud Benefits
Current Environment
EFFICIENCY Improved asset utilization (server utilization>60-70%)
Low asset utilization (server utilization
