How To Pitch Hybrid Cloud To Your CFO

In this article, TechWeekEurope has called on the experts from the hybrid cloud arena to explain how to pitch the idea of using hybrid cloud to your chief financial officer (CFO). The first step is understanding what exactly hybrid cloud is, and if you need help with that then we suggest heading over to How To Explain Hybrid Cloud To A Five-Year-Old, published on TechWeekEurope earlier this month.

Gordon Haff, Cloud Strategist at Red Hat:

“A hybrid cloud puts CFOs and their companies firmly in control of their own IT economic models and compliance obligations. It gives them the ability to choose to focus on CAPEX or OPEX expenditures. It gives them the ability to treat a given part of their IT infrastructure as an ‘outsourcable’ expenditure or a strategic asset to maintain in-house.

“A key requirement to keep in mind however is to take an open approach to hybrid computing whenever possible. This leaves the organisation in control of their technology roadmap by maintaining the ability to move workloads between public clouds and internal IT infrastructure.”

Martin Warren, Cloud Solutions Marketing Manager, EMEA at NetApp:

“A hybrid cloud solution is perfect for data storage, as it provides organisations with the security and control of an on premise data centre and the agility and economics of the cloud, which is why more and more organisations are adopting it.

“It’s a cost-effective solution, as companies can switch cloud services on and off as their requirements change, meaning they do not pay for more than they use.

“Going down the hybrid cloud route provides organisations with the flexibility of being able to change or add service providers as their needs or technology develop. Choosing a technology vendor that can provide data portability in a common format between cloud and service

providers is really important as, unlike compute, which is transitory, data has physical mass, is valuable, and needs to be protected and managed, often against industry or government regulations, over the course of many years.

“In some instances, organisations can still have data sovereignty and security concerns, even with hybrid cloud solutions. The beauty of using a hybrid cloud solution is that you can choose which data should remain private and which elements you’re happy to store in the public cloud. One solution is to select a co-located data centre, which is close to the cloud provider, but not actually in the cloud. That way, organisations can get all the benefits of the cloud, combined with the security of storing data in a co-located data centre.”

William Fellows, 451 Research:

“Hybrid cloud is simply a delivery model. It consists of two or more distinct cloud infrastructures that remain unique entities, all coordinated by standardised or proprietary technology, and interoperate to deliver seamless business functions.Users expect to be able to make rational decisions about how and where to run applications and tasks based upon workload profile, policies and SLA requirements.

“As the worlds of outsourcing, hosting, managed services and cloud converge, the options are growing exponentially. Best Execution Venue strategies will enable users to determine which hybrid services are right for their needs. The most sophisticated IT users may operate these supplier relationships independently, but even those with contract negotiation expertise will likely struggle with the complexity of mechanisms available, especially in relation to cloud service pricing and delivery.

“The reality is that most organisations don’t have access to more than a handful of cloud services – the same kind of access as they probably have to other utilities. Indeed where they do exist these are mostly bi-lateral sourcing relationships between the end user and service provider.

“We expect third party tools including technical and financial cloud brokers, business application marketplaces and other integrators can therefore have an important role to play in providing access to other venues. Some applications, workloads or service requests may be best suited to running on-premise, for others a public multi-tenant cloud may be sufficient, while a dedicated hosted venue may be necessary to meet others. This is the operation of the hybrid cloud model.”

Juniper Network’s Paul Gainham, senior director of marketing EMEA:

“You run and own your own business. Think of Private Cloud as owning your own car.  You are fully responsible for its upkeep, security and its (mostly) fixed costs and you ultimately decide how and when its used and who uses it, could be you, could be other members of your family.  Think of public Cloud as renting a car for a specific purpose.

“The user interface is predominantly the same but now ownership of the car is with somebody else who carries all of those fixed costs whereas you literally are responsible for the ‘pay as you use’ variable costs of rental period and fuel.  Now think of Hybrid cloud.  As your business ebbs and flows, you may decide to vary the number of rented cars.  You don’t sell your own cars, you

keep them.  You can terminate the car rental almost immediately with no long term ‘penalty’.  This is Hybrid Cloud, a seamless combination of owned and non-owned assets allowing for rapid expansion and shrinkage of usage, paid for on demand.

“Interestingly, if you spell the words Hybrid, Public and Private with Scrabble tiles, Hybrid is worth more than either public or private and is an interesting indicator of where future value lies.”

Zahl Limbuwala, CEO, Romonet:

“The main information a CFO wants to hear is whether hybrid cloud, or any other strategy, will either save the business money or provide a return on investment in the long run. Data centre and IT capacity is expensive, so what you own should be kept as heavily utilised as possible to maximise its value and counteract a substantial fixed cost burden. Excess demand, particularly in the short-term, can be displaced into a service provider’s cloud to minimise your required investment. However, sometimes the load can be operated in-house at similar or lower cost than many of the cloud providers in the market today.

“Reducing load and displacing some to the cloud is frequently misrepresented as a cost saving measure but in the vast majority of cases it simply drives up the cost of the remaining in-house services and fails to deal with the underlying fixed cost base. As a result, understanding the cost impact of each choice is critical, not just a single project at a time but strategically. If the IT department can present the comparative costs of an in-house, hybrid and pure cloud approach, it will find the CFO much easier to convince of the correct course of action.”

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