IT Capabilities Transformation of Cloud Computing - Essay Example

?Introduction Cloud computing is increasingly becoming an attractive paradigm for businesses regardless of whether the enterprises are small, medium or large. Decreased capital and operating cost coupled with agility of service development and deployment, as well as the capability of cloud to allow scalability in times of high and lows of enterprise provisions are some of the promises of this trend. Nevertheless, for organizations to achieve the benefits of cloud computing, organizations have to tread carefully and have the right map for migration to cloud environment. Among other things, organizations have to develop enterprise applications that are suitable for distributed environments and appropriate data, information and infrastructure architecture. Established organizations have strategic vision that drive their future direction offer guidance toward business strategies, which in turn drive the IT strategy useful in developing the enterprise architecture. This offers an organizing principle, which aligns the mission of the enterprise with its IT strategy and implementation plans. Cost flexibility and IT scalability in cloud computing Business organizations large and small all over the globe and in almost all industries embrace cloud computing as a means of reducing the difficulty and costs linked to conventional IT approaches. Cost flexibility is an essential reason many companies value adoption of cloud computing because cloud environment has the ability to decrease fixed IT costs and shift to variable cost structure. Cloud computing enable organizations to decrease fixed IT costs because it allows shift from expenses on resources to operational expenses. Capital expense in IT that often involves enterprise software licenses, servers and expensive networking equipment that are less fluid and hard to forecast compared to IT operating costs associated cloud computing. Therefore, cloud computing applications make the conventional hardware, software installation and dedicated software license fees redundant because cloud services allow an organization to shift costs from capital to operational costs. By adopting cloud environment, organizations pay only for what the organizations need when necessary; hence, this pay per use offer great flexibility and eradicates the desire for significant IT capital expenditure. Cost flexibility is an appealing attribute of cloud computing because apart from cost flexibility, cloud computing offer firms access to tool and computing power that would normally be affordable to large companies (Berman, et al, n.d). IT scalability is acknowledged as major benefit associated with cloud adoption; but for organizations, cloud offers more than mere IT scalability because it allows organizations to scale business operations as well. By offering quick provisioning of IT key resources with no scale restrictions, cloud computing enables organizations to gain from economies of scale without accomplishing large volumes of vital resources on their own. Apart from business scalability and cost flexibility offered by cloud, cloud computing also provides the advantage of masking complexity. Cloud computing provides businesses a means of hiding some complexities of their operation, which is helpful in attracting a broad scope of consumers. Since cloud computing veils complexity from end users, a company is able to expand product and service sophistication without increasing the level of knowledge within user regarding use or maintenance of the product or service. Convergence of enterprise architecture and cloud computing has enabled a shift from monolithic systems to multitier architecture. As service-orientation concepts become pervasive and popular, IT in enterprises fully embraces them in order to be flexible in its operations, offerings and outlook. With massive adoption of cloud computing, enterprises are changing themselves into on-demand, instant-on, lean and adaptive organizations. Cloud computing being an enterprise-class technology naturally merges and mingles with enterprise architecture in preparing and offering advanced capabilities to global enterprises. Moreover, acquired knowledge in cloud computing results in readying the underlying IT systems for proactive, pre-emptive and to the constructive delivery of versatile and premium services. Service orientation in enterprises has become the most common architectural principle and pattern for designing and delivering enterprise-scale applications (Berman, et al., n.d). Cloud computing vs. Contemporary IT Information technology in the contemporary digital age was an integral part of organizational infrastructure in most knowledge-intensive organizations within any sector. Traditionally IT resources like data, software, CPUs, servers and memory cards are hosted internally and maintained by the user organizations. However, with the continuous business and technology evolution, organizations are increasingly supported by various IT applications and sophisticated IT infrastructure. The increasing amount of internal IT facilities and resources has become costly and time-consuming for organizations to maintain. The development of fresh IT and web technologies including cloud computing emerged in recent years to be a solution to the dilemma in IT. Cloud computing being an advanced IT model hosts and shares both software and hardware resources through the internet, which allows organizations to use IT resources and applications virtually through the web without holding those resources internally. The emergence of cloud computing facilitated IT standardization and commoditization, which is a phenomenon where IT resources especially infrastructure resources like storage, servers and networks are used by companies as standardised commodities instead of being uniquely designed, installed and maintained. Cloud computing promises to offer organizations high quality and advanced IT services with substantial low costs because of reduced hardware investments, less maintenance fee and low electricity consumption associated with IT usage. These features and potential benefits associated with cloud computing are widely considered as the most important development within the IT industry in late 2000s. In fact, the period between 2008 and 2010 cloud computing was consistently rated as one of the best strategic technologies with the potential of changing traditional IT usage within corporations and even transform the IT industry globally (Dutta, et al., 2013; “IBM Study Says”, 2012). Although data centre performance requirements are increasing, IT managers are looking for ways to limit physical expansion by increasingly utilizing the current cloud resources. Server consolidation through server virtualization has become an appealing option because the use of multiple machines take advantage of physical server computing potential and enable rapid response to shifting data centre demands. Power consumption and efficiency continue to be a concern in typical IT data centres for operators and designers because the data centre facilities have to be designed with specific power budget. Moreover, development in the number of servers and increase in electronic components in conventional IT environments consume power at a very high rate; hence, the need to embrace the cloud computing to reduce costs and improve business outcomes. Cabling also in conventional IT environment represent a significant part of typical data centre budget because cables sprawling limit data centre deployments by obstructing airflow, which requires complex cooling systems; therefore, IT departments look for innovative ways to help organizations keep up with rapid growth with increased efficiency at a low cost (Valerdi, 2013; Josyula, Orr and Page, 2012). Challenges in cloud computing However, despite the attractive features and benefits associated with migration to cloud computing, moving internal IT resources and sensitive business data to cloud vendor is not an easy decision for CEOs, and IT managers. In fact, the adoption of cloud environment is associated with many potential risks and challenges related to security and privacy of business and customer data in the cloud. Moreover, organizations have to companies have to make various internal changes like refining It roles and downsizing the IT department to prepare for the new cloud environment. This has the potential of resulting in job dissatisfaction within the in-house IT and business staff. Once an organization the essential effort to migrate their data and IT application to the cloud environment, it makes it difficult and expensive for the business to move back to the in-house IT environment in case something goes wrong (Dutta, et al. 2013). Lack of trust in cloud computing is the main barrier to broad adoption of cloud computing because the lack of trust invalidates the economic and increased flexibility associated with the cloud environment. The rapid increase in computing power together with the increased use of virtual machine environment increases the demand for high bandwidth and at the same time creating extra challenges to the supporting networks (Josyula, Orr and Page, 2012). In conventional IT environments have dedicated physical servers and their associated applications, maintenance and licensing costs and easily mapped to departments using them, which helps make billing straightforward for such resources. However, in shared virtual environment, the task of calculating IT operational costs for all consumers in real time is a major challenge. The top concern in IT leadership teams implementing the utility platform involves how providers of cloud computing track service and bill the service usage; hence, the dynamic nature of cloud computing and its associated layer of abstraction increase metering complexity of services offered. Workings of cloud computing Cloud delivery models help organizations scale investments while they grow their businesses and open door to fresh business approaches through standardised application and business processes that aid in improving service delivery and efficiency. In cloud computing, vital IT resources are vigorously pooled into centralised hosting services in order to effectively offer enterprise data as well as enterprise services. The cloud environment allows ubiquitous access to critical IT services from a wide range of networks and mobile devices; hence, the high accessible applications in cloud computing are accessible through devices like smart phones. Since cloud computing has automated and dynamic scaling as well as elasticity, it allows users to respond to changing demands and automatically change resources in order to meet service level. Cloud computing transforms IT capabilities in various ways; for instance, using internet portal, cloud users are able to provision certain servers and network storage with no human interaction as well as manage infrastructure and inventories. Through cloud computing, critical IT services and software are accessible at any time from a wide range of network devices without installing the programs in local machines. Moreover, clouding computing allows individual computing resources to be pooled, which allows operating environment to be dynamically changed according to consumer demand. Rapid elasticity offers largest benefit to cloud users because of its automated and dynamic scaling of computer resources and its ability to monitor the environment and adjust computing resources as required. In addition, since cloud users pay for what they use, the model reduces upfront investment costs and allows transparent monitoring, controlling and reporting to both the user and the provider. Since cloud computing uses infrastructure as a service, the model bases on self-provisioned services, which allows automatic provisioning of servers and network storage without the need of human intervention (Allen, n.d; Oracle, 2011). Through preservation of crucial resources and enhancing mission performance, cloud computing has the ability to transform organizations because, simplicity, transparency and security in the cloud are essential in organization’s successful adoption of cloud computing. However, cloud computing requires significant and wide changes in order to reap the true promises of the new model in IT; hence, successful adoption of cloud computing relies on careful planning that addresses the range of capabilities implied by cloud computing strategy. In cloud computing architecture, capabilities involve guidelines that ensure practitioners adhere to the architecture; however, crucial capabilities in cloud architecture include resource pooling, interoperability and self-service. Infrastructure in cloud computing include capabilities regarding service infrastructure and tools that offer technical foundation for the cloud environment such as shared services, provisioning and model packaging. Operations, administration and management in cloud computing involve capabilities regard the post deployment features of cloud service like all aspects of administration, operations and management within the cloud environment. Moreover, organizations have to develop organizational competency around cloud computing in areas such as the organizational structure and skills as well as the organization authority. In essence, cloud environment provides access to applications that usually reside in a different location instead of being in an organization’s computer but rather in a distant data centre. The beauty of cloud computing is that another company hosts an organization’s application or even suite of applications meaning that the hosting company handles the cost of server, managing software updates and depending on the contract the contracting organization pays less for the services offered. This means that the business does not need to buy the costly equipment, which in return means reduced capital expenditure. Moreover, by having another company host the applications of an organization means that the organization never requires purchasing of the servers or even pay for the electricity to power and even cool servers down. Moreover, cloud computing is a convenient way of telecommuting and travelling because remote users can simply log in and use the application regardless of their location. However, although cloud computing is great, as with all things in IT, cloud computing has its pros and cons; for instance, although an organization’s internet outage with its internet service provider is rare, the organization may be unable to access its applications and carry out its business because the cloud service provider is inaccessible. For instance, in 2008, Amazon’s S3 cloud storage service went down and many applications hosted by the company and its services could not be accessed until technicians fixed the problem and some applications were down for up to eight hours (Velte, Velte & Elsenpeter, 2010; Mahmood, 2013). Cloud computing has integration issues like trying to integrate applications that are geographically dispersed; for instance, for two applications to exchange information, it would be easy if they resided in the same place. In topological sense, cloud environment is made of various elements that include clients, data centre as well as distributed servers that make up cloud computing solution for businesses. Each constituent in cloud computing plays a precise and significant role in distributing functional cloud based applications. Clients in cloud computing architecture are the local area networks and computers such as desktops, laptops, tablets, smart phones or even PDAs that are propel cloud computing owing to their mobility. Cloud computing categorises clients in three categories; mobile clients like smart phones; thin clients, which are computers without internal hard disks that allows servers to do the work and thick clients, which are the regular computers that use web browsers to connect to the cloud. The data centre in cloud computing is a collection of servers where the organisation’s applications are kept; the servers are often kept in large rooms. However, there is a growing trend in IT of virtualizing servers through installed software, which allows multiple instances of virtual servers within the same physical server. Moreover, cloud computing also embraces distributed servers instead of servers found within the same location. This offers service providers increased flexibility in options and security; for instance, Amazon has its cloud solution in servers all over the world. There are various ways through which cloud infrastructure can be deployed depending on the application the provider builds the cloud solution. This feature remains a crucial advantage for using cloud computing because an organization’s needs may exceed in-house budget; however, the processing power of cloud computing offers a cheap alternative for organizations (Velte, Velte and Elsenpeter, 2010; Goodburn and Hill, 2010). In conclusion, cloud computing has become mainstream IT world because it has the influence to unlock doors to competent, responsive and new methods of conducting business. Corporations across the globe acknowledge cloud’s capabilities in promoting sustainable competitive advantage in businesses and changing the IT department in the organizations. Cloud computing is transforming the conventional way IT has been in business through its cost effective way of handling company data through sharing the processing power of cloud resources. References Allen, B., n.d. Cloud Computing. [online] Available at http://www.boozallen.com/media/file/12.004.10H_Cloud_Comput_Cap_FS.pdf [Accessed 10 October 2013] Berman S.,et al., n.d, The power of cloud: Driving business model innovation. IBM Institute for Business Value. [online] Available at http://www.ibm.com/cloud-computing/us/en/assets/power-of-cloud-for-bus-model-innovation.pdf [Accessed 10 October 2013] Dutta, A, et al. 2013, 'RISKS IN ENTERPRISE CLOUD COMPUTING: THE PERSPECTIVE OF IT EXPERTS', Journal Of Computer Information Systems, 53, 4, pp. 39-48, Goodburn, M, & Hill, S 2010, 'The Cloud Transforms Business. (cover story)', Financial Executive, 26, 10, pp. 34-39. 'IBM Study Says Cloud Computing to Rewrite Corporate Business Model' 2012, Security: Solutions For Enterprise Security Leaders, 49, 4, pp. 14-16. Josyula, V., Orr, M., & Page, G., 2012, Cloud computing: automating the virtualized data center. Indianapolis, Ind, Cisco. Mahmood, Z. 2013, Cloud computing methods and practical approaches. London, Springer. http://dx.doi.org/10.1007/978-1-4471-5107-4. Oracle, 2011, ‘Cloud Computing Maturity Model Guiding Success with Cloud Capabilities’. [online] Available at http://www.oracle.com/technetwork/topics/entarch/oracle-wp-cloud-maturity-model-r3-0-1434934.pdf [Accessed 10 October 2013] Valerdi, R 2013, 'The cloud systems', Industrial Engineer: IE, 45, 8, p. 28. Velte, A. T., Velte, T. J., & Elsenpeter, R. C., 2010, Cloud computing a practical approach. New York, McGraw-Hill. Read More