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INFOTECH: Cloud–Driving Operational Efficiencies, Increasing ROI, Decreasing TCO and Creating a Competitive Advantage


Recent Western Cape Business News

Cloud computing has the potential to deliver significant business benefit by turning IT into an operational cost rather than a capital expense. In addition, cloud is the foundation of leading-edge technologies such as mobility and collaboration, which are essential for competitiveness in today’s business world. Cloud also helps to simplify off-site disaster recovery (DR), enhance flexibility and scalability of technology, and ensure organisations can leverage the latest and greatest solutions and software updates without additional investment says AJ Hartenberg, Portfolio Manager: Data Centre Services at T-Systems in South Africa

All of these benefits combine to deliver improved operational efficiency, which allows for significant return on investment (ROI), lower total cost of ownership (TCO) of IT, and most importantly, the creation of a competitive advantage. However, leveraging these benefits to their full extent requires flexible, self-service IT service provisioning, and making sure this is in place and available is critical to the success of cloud implementations.

Cloud underpins a dynamic infrastructure service, of which flexible IT service provisioning is a vital component. As IT becomes increasingly consumerised and commoditised, self-service provisioning becomes essential in allowing users to fully leverage the flexibility of the cloud. Self-service provisioning enables customers, or tech-savvy IT administrators, to provision their own virtual machines, as well as increase or decrease processing power and storage as and when required. It can also be extended to enable customers to provision operating systems or even databases. This is enabled thanks to the virtualised nature of cloud computing– there is no need to go through lengthy procurement cycles to obtain physical hardware or software licenses, all components are delivered as a service, on demand and on tap. This creates significant competitive advantage, while improving TCO and ROI.

Take for example a company that is responding to a market demand for a new service. In order to develop and deliver this service, four new servers may be required. In order to commission these servers and go through the procurement channels and procedures, it could take up to six months for the servers to be ordered, delivered, configured and operational. By then, the window of opportunity has probably passed and competitors that make use of IT service provisioning will have already delivered this same service to market.

Furthermore, the compute and storage requirement is usually inflated, as the team of developers will want to ensure they do not under-estimate these requirements. There is a hefty price tag involved with this, and by the time the project is completed, the capacity and computing power of these servers may not necessarily be utilised fully when absorbed back into the main IT infrastructure. Something else that is often overlooked is the fact that operating systems become out-dated, as does the server technology. What must be considered is the IT cost involved that contributes to the overall cost of the new service. This is factored into establishing the price of the new service as an indirect cost, resulting in a higher price, which further hinders competitive advantage.

Flexible, self-service IT provisioning effectively addresses all of these challenges. The necessary additional servers can be provisioned in a matter of minutes, as opposed to months, allowing an organisation to take immediate advantage of opportunities. Compute and storage capability can be added exactly to the specifications required, as this can be up- or down-scaled dynamically should the estimated requirement be inaccurate. The cost of the additional capacity is added to the monthly cloud service fee, rather than requiring initial investment, and if it becomes obsolete in future, this capacity can simply be removed from the virtual services basket. Server and operating system technology will always be the latest solutions. As a result, organisations are empowered to take advantage of market opportunities quickly, and deliver more cost effective and agile solutions to their end customers.

With flexible self-service provisioning enabled by the cloud, organisations can dynamically scale IT infrastructure in both directions to add or remove servers, applications and other IT resources on demand. The cloud and virtualisation effectively enable IT infrastructure and services to become commodities to be consumed as services on demand. In addition, the IT department now becomes an IT service aggregator, rather than its traditional role as a procurement house for technology.

Cloud has become essential in creating a competitive advantage, as business profits now rely on how quickly an organisation can get to the customer with services they need to become and remain engaged. Delivering products and services customers’ need, when they need them, is critical to business success, and this is underpinned by the delivery of IT services and solutions in a flexible and agile manner through virtualisation and the cloud.


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