Академический Документы
Профессиональный Документы
Культура Документы
March 7, 2012
Agenda
Ongoing budget pressure Demand for business value Vendor i i V d pricing Security and regulatory compliance
High cost single-tenant models Underutilization f U d tili ti of dedicated hardware Suboptimal skill mixes Underachievement of economies of scale
Rapid volume growth; high variability; explosion of data / complexity l it Anytime / anywhere access Speed / on-demand service Configurability
Flexibility Impact
Talent Factories
High talent, low cost resources organized by an optimized workforce pyramid
Optimized staffing pyramid leading to improved resource utilization Remote support from low cost locations Dynamic workload shift to achieve 4-5X efficiency gain Pooled resources/multitenancy Cost linked to C t li k d t consumption ti
Improved access to specialized skills and technical expertise Enhanced resource scalability On-demand processing and storage capacity Self-service provisioning Capital avoidance
Cloud Services
IT delivered as a service through private, public, and/or hybrid cloud models
Mobility
Smartphones, tablets, sensors and other mobile end point end-point technologies.
Lower device end-user TCO (for certain segments) Productivity improvements y p Location and motion information utility
Payroll Order-to-cash Procure-to-pay P t Hire-to-retire CRM HCM Email Collaboration F&A Dev Only Dev + Runtime
Platform as a Service
(PaaS) PaaS)
Multi-tenant application development and hosting p g environments Shared data center, infrastructure hardware and software resources
Infrastructure as a Se ce Service
(IaaS) IaaS)
Compute (Server / OS) Storage Database Networking Content Delivery Compute (Server / OS) Storage Database
Levers and impact differ by delivery model BPaaS SaaS PaaS IaaS Private / hybrid cloud Economics sensitive to contextspecific factors Refresh cycle Migration approaches and cost Significant variations in value impact across vendors / CSPs
Cloud Impact
Shift loads to fill valleys (where possible) Maximize private cloud utilization
Hybrid models can drive truly disruptive economics Applicable at individual workload and portfolio level Dynamic bursting not required to capture initial benefits p
100
65 60-65
Peak Load
Public Cloud
Shift spike compute hours to public cloud Pay only for consumption
25
Public Cloud
N/A
( (service provider) p )
Hybrid Model
40%
Private Cloud
Keep base compute hours in private cloud Maximize utilization
1 Assumes average workload mix and profile; 15% of total peak workload hours shifted to public cloud in an on-demand model; does not include application migration costs Source: Everest Group Cloud Value Assessment Model
Agenda
Formulated sourcing strategy for corporate IT infrastructure supporting operations in 28 countries on 5 continents Reduce asset ownership Outsource commodity skills Secure variable pricing Explored Next Generation cloud solutions with 4 global providers Strong cloud capabilities SAP expertise and global reach Ability to transition quickly Assessed proposals for broad managed services solutions with different cloud mixes Range of savings potential Variety of cloud intensiveness
Consolidated IT Outsourcing agreements for 12 operating companies into a single service provider Build a solution that has high availability during and after transition Reduce cost of IT Evaluated proposals for comprehensive IT infrastructure outsourcing Traditional IT outsourcing solutions Cloud-based solution Awarded contract to provider that proposed cloud-based solution, albeit with a more conservative transformation timeline than original cloud proposal
10
Shared
Solution Description
Solution leverages true public cloud (via partner) ~80% of workloads to cloud-based services; includes DR SLAs reflect standard (public) offering, not customized to client situation 82% of workloads to private cloud, includes DR SAP resides fully in cloud environment No minimum commitments required SLAs reflect shared environment
Provider A
Physical SAP
Private Cloud
Public Cloud
Provider B
Physical
Provider C
Physical SAP
Solution aggressively virtualizes (20:1 ratio) and transitions to a dedicated, single-tenant environment; excludes DR Client-specific SLA s met Status quo does not transform infrastructure No formal service levels; no self-service portal; no consumption-based service model; no service catalog; no ability to track application usage Incomplete DR provided for select business applications
11
Baseline
Physical SAP
Virtual
0%
25%
50%
75%
100%
Nearly 30% improvement in cost provided by public cloud-enabled solution Even modest use of public cloud to drive utilization appears to have substantial benefit All provider solutions include enhanced scope (albeit with some SLA tradeoffs) Rapid changes in cloud service provider landscape make provider selection an important success factor
Year 2
Year 3
Year 4
Year 5
1 Transition costs are spread over 2 years; retained costs excluded. Proprietary & Confidential. 2012, Everest Global, Inc. 12
Solution must provide high availability infrastructure, with heightened sensitivity during transition Key decision criterion is magnitude and timing of cost savings Total scope included infrastructure and applications (this case example focuses on infrastructure) RFP guided service providers toward traditional solution
Cloud-based solution
Dedicated private cloud for most applications (including SAP) No movement of clients existing, owned equipment 90% of desired SLAs met Perceived risk of service disruption during transition was low
13
200
150
38% cost improvement provided by cloud-enabled solution All provider solutions address p substantially same scope as Baseline
CloudEnabled solution
100
50
Represents initial pricing from all providers (expectation for p ( p substantial concessions from finalists were met) Year 4 Year 5 Year 6 Year 7 Provider 4s cloud-centric solution provided compelling economic advantages
0 Year 1
Year 2
Year 3
Footnote: Transition costs are included. Providers ramp-up services in first two years. Provider 1 is the incumbent. Client chose cloud provider. Analysis based on largest subsidiary of the parent company.
Proprietary & Confidential. 2012, Everest Global, Inc. 14
Apps SaaS
Cloud Impact
B Opportunists
Cloud adoption opportunistic; primarily driven by business unit / departmental initiatives
C Solutioners
Cloud adoption intentionally driven by business / functional use cases and needs
D Transformers
Cloud models leveraged broadly across the enterprise, integrated with traditional models, often driving wide-scale IT transformation
E Provider
Cloud models providing foundation for new, integrated service delivery business model based on services market principles
Cloud Penetration SaaS IaaS Private / Hybrid None / limited Individual buyers None None Limited / Modest Ind. / dept buyers Individual use Private POCs Modest LOB buyers POC / pilots Limited Modest / Ext Enterprise buyer Limited Modest Modest / Ext Enterprise buyers Limited Extensive
Business
Business
Business / IT
IT
Business / IT
Agenda
17
18
Exclusivity contract limits services that can be contracted to other providers Revenue commitment (floor) minimums preclude moving workloads Performance guarantee service levels cannot be met by cloud solutions Regulatory compliance regulations cannot be satisfied by cloud solutions Warranties cant cleanly separate scope for cloud services can t services
19
Not present; tower termination Demand exceeds floor Engineered outcomes Vertically-oriented clouds Scope / change management
20
Financial Disincentives
Lack of cloud delivery platforms and technologies across private, public and hybrid models bli d h b id d l
Skill Gaps
21
Were seeing ~33% less revenue on cloud ITO clients this is creating a lot of internal resistance to move our clients
- Sales Engineer, leading IT services vendor d
Yes, e provide o Yes we can pro ide you SAP in a cloud environment!
- Same sales rep, one week later Names have been changed to protect the innocent !!!
revenue until we change our comp plans, theyll never drive to cloud solutions
- Executive, leading IT services vendor
We have found that cloud solutions cannot economically compete with our data center solutions"
22
Strategic fit Business model Alignment Investment model Offerings Structure/packaging Delivery capability y p y Go-to-market Sales approach Pricing models Solutioning Example p p providers
Enterprise-focused Strongly influenced by legacy, risk-shifting frame of reference Strong enterprise-class skills Enterprise-focused Talent-based Underdeveloped for enterprise Advanced, consistent with legacy Limited enterprise solution focus Largely absent for enterprise Sophisticated, cloud-centric Legacy elements tend to appear in cloud offerings Cloud delivery capabilities often mixed with legacy Biases toward enabling rather than core solution Talent model focused Network-centric flavor often exists Building capabilities Highly standard cloud not always enterprise-friendly Most advanced cloud-focused Difficult balance of traditional and cloud models Conflicting goals, especially with existing revenue base Bias toward client funding of initiatives Focus remains on talent services to enable cloud Poor fit with infrastructure Little appetite for investment beyond talent factory y y Difficult balance of traditional and cloud models Good alignment with standard delivery; less go-to-market Strong alignment with historical approaches pp Built from start for cloud Sharp cloud focus Oriented to support rapid cloud growth g
Enterprise-oriented
23
DR/ BCP Spiky LOB applications Web sites it ERP Backup/ archive Virtual desktop d kt Transactional applications
HCM
24
Everest Group
Leading clients from insight to action