A briefing for a large retailer considering cloud services.
Perhaps the biggest buzzword regarding business over the Internet today is Cloud. In basic terms, the cloud can be defined as, “any of several, often proprietary, parts of the Internet that allow online processing and storage of documents and data as well as electronic access to software and other resources” (Dictionary.com, 2016). The concept of the cloud has been around for years, but has gained popularity in the last seven years with most businesses today using the cloud in some form or another (Kavis, 2014). The key pluses of moving to the cloud can save companies on what matters most: resources, time and money. Although the cloud has the ability to make a company more agile, there are minuses that should be considered before moving to the cloud. The decision about moving to the cloud should be based on an analysis of the current legacy architecture, the provider’s steadfastness, the technical knowledge of the people, and the degree of security.
Pluses of the Cloud
Scalability is a major advantage of cloud servicing. It is possible for a business to call and increase or decrease services to match their customer demand at any given time, with seemingly unlimited resources (Barry, n.d.). One of the challenges that large retailers face is the massive amount of data and information they need to handle. Google operates colossal data centers that include over 900,000 virtualized servers. Other cloud providers have followed suit, allowing them to meet the needs of these retailers (Popat & Stine, 2012). The amount of information users are producing is increasing by 35% every year (Wang & Lin, 2016). In a retail environment, increasing data can be analyzing customer feedback and complaints through social media and other channels, tracking customer buying habits, or managing inventory information. It is essential for businesses to hear and respond to what their customers are telling them in order to remain successful.
Businesses utilize providers’ resources on a pay-per cycle, pay-per use or on-demand basis (Bhardwaj, Jain & Jain, 2010). As mentioned earlier, a user can call a provider and scale up or down their resources. This is especially attractive for retail chains, for example, when sales peak towards the end of the year and decrease after the holidays. The user is only going to pay for what is used and needed; this can have significant cost savings. A real life example can be seen in Michael Kavis’s Architecting the Cloud, when his total cost was $1 to test a new virtual resource for two hours from the cloud provider. Three new prototypes were tested on a daily basis costing a total of $3. Alternatively, if the company did this themselves, they would have to purchase three different servers costing up to $5,000, decide on one, buy more of the one that worked, and disregard the others. Also, cost savings can be massive due to the fact that the cloud provider is responsible for procuring, installing, managing & upgrading the hardware (2014).
Time is money, and being able to do everything quicker is another plus of moving to the cloud. “Since moving some applications and data to Amazon’s cloud last April, Eli Lilly & Co. has seen provisioning time drop from weeks to minutes” (Schultz, 2009). On-demand access allows services to be ready to run in only five minutes, and users can test a different virtual services within two hours (Kavis, 2014). While the provider is maintaining resources for the user, more time will be available within the company to innovate and focus on its products and customers.
Minuses of the Cloud
Although time and money can be saved switching to the cloud, there needs to be an analysis to determine if the cloud will be able to sustain those qualities long term. On the other side of the scalability coin, for large enterprises, it may be more cost effective to create its own cloud rather than using a provider’s: “The bigger you are, the bigger your IT resource pool…the less likely it is that you’ll see any enormous financial advantage in outsourcing to the cloud” (Schultz, 2009). The provider’s reliability must also be taken into account. How often has it had an outage? Does its bandwidth provide a fast enough connection for our users? These are all real possibilities that can cause poor service for a client.
Most large retailers have been around a long time, which means that there are organizational challenges when transitioning to the cloud. The data centers and servers they currently use have been in place for years, and it may be more difficult to move that information to the cloud. There is also the human factor to consider. The cloud generation requires people with technical savviness and the drive to learn new things, which at times can be exasperating (Schultz, 2009). Does the client have the right people with the right skills to move to the cloud?
The greatest disadvantage with cloud computing is the security of information. When using cloud services, the client will be sharing the responsibility of protecting information, and that can expose vulnerabilities when moving data from one kind of security framework to another. The cloud has a lack of standards and best practices due to its recent popularity and development. It can be challenging for the user to monitor if the provider is keeping data secure and in accordance with any governance standards the company is required to comply with. If there are any faults or weak points in the provider’s resources, attackers can steal, damage or compromise the user’s data. Due to the multi-tenant environment in the cloud, providers are desirable to hackers because if they were successful at breaking through the system, they could have access to more than one company’s information (Erl et al., 2013).
Before recommending that the client move into the cloud, many issues need to be examined. While the pluses seem to outweigh the minuses of the cloud for a large retail chain, we do not want the client go into the cloud head first. We will have to analyze the cons of the cloud and make certain that they will not prove destructive to the company. For example, does the cloud provider have sufficient strategies to avoid outages and security breaches, and also a plan should the client be faced with any threat? It also needs to be determined how much time and money would be saved, and if the company employs people with the technical savviness to work with the cloud. The plan of action that I propose, then, is to examine the client’s needs and problems and decide if the cloud services would resolve them. After choosing a cloud solution, it should be analyzed on a regular basis to be certain that the pluses outweigh the minuses. In cautiously joining the cloud system, the company will be able to choose the provider and services that are the right fit for the business.
Barry, D. K. Service Architecture. Retrieved October 2016, from Semantic vocabularies, http://www.service-architecture.com/articles/cloud-computing/infrastructure_as_a_service_iaas.html
Bhardwaj, S., Jain, L., & Jain, S. (2010). Cloud computing: A study of infrastructure as a service (IAAS). International Journal of Engineering and Information Technology, 2(1), 60–63. Retrieved from https://www.academia.edu/1181740/Cloud_computing_A_study_of_infrastructure_as_a_service_IAAS_
Dictionary. (2016). The definition of cloud. Retrieved October 2016, from http://www.dictionary.com/browse/cloud?s=t
Erl, T., Puttini, R., & Mahmood, Z. (2013). Cloud computing: Concepts, technology & architecture. Boston, MA, United States: Prentice Hall, ServiceTech Press.
Kavis, M. J. (2014). Architecting the cloud: Design decisions for cloud computing service models (SaaS, PaaS, and IaaS). Hoboken, New Jersey: John Wiley & Sons, Inc.
Popat, B., & Stine, J. (2012). Achieving Retail Agility Is Cloud Computing the Answer? Retrieved from http://www.cisco.com/c/dam/en_us/about/ac79/docs/retail/Retail-Cloud-PoV_IBSG.pdf
Schultz, B. (2009, May 18). Cloud computing: Pros and cons. Retrieved October 2016, from http://www.networkworld.com/article/2268032/cloud-computing/cloud-computing–pros-and-cons.html
Wang, C.-S., & Lin, S.-L. (2016, June 26). Why are People Willing to Pay for Cloud Storage Service? Retrieved 2016, from Computer and Information (ICIS), 2016 IEEE/ACIS 15th International Conference, http://ieeexplore.ieee.org.proxy.bsu.edu/stamp/stamp.jsp?tp=&arnumber=7550806&tag=1