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This article was published on December 2, 2013

Is Hybrid Cloud the future for enterprises?

Is Hybrid Cloud the future for enterprises?
Ian Gotts
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Ian Gotts

Ian Gotts is a tech CEO and non-exec director, author of 7 books and a challenging yet entertaining speaker. Having sold his last company to Ian Gotts is a tech CEO and non-exec director, author of 7 books and a challenging yet entertaining speaker. Having sold his last company to TIBCO he is now reinventing the event management space with his latest startup based in San Francisco / @iangotts

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The question is, “Is hybrid cloud the only way to go for enterprises?”

With all the talk of cloud, there are major corporates that, due to IT strategy and legacy, are unable to migrate 100 percent fully to cloud. So is hybrid the only way to go? This article looks at the rise the hybrid cloud and the implications for enterprises.

What is hybrid?

First there was “the cloud”, but now there are multiple clouds: private cloud, public cloud, G-cloud, Stealth cloud…. And now there is “hybrid cloud”. As the name suggests, hybrid cloud is a combination of a number of clouds, but most commonly it is the private cloud together with the public cloud.

So the private cloud is what used to be called your company network. It may be accessed whilst inside the firewall, or outside via some form of secure VPN. But it is a resource controlled and consumed by your internal IT department.

The public cloud comes in many forms. It could be cloud-based resource (sometimes called Infrastructure-as-a-Service – IaaS), or it could be provided with a cloud application. The fundamental difference is that a cloud resource can be consumed and used as an IT resource, just like the private network, albeit with the opportunities and constraints of a cloud service. The cloud application has a cloud service provider behind the scenes, but this is managed and charged as part of the cloud application.

Choice or history?

So is hybrid part of your company’s IT strategy, a necessary evil, or something that seems to have appeared in your IT landscape?

I would suggest for many corporates, it is the latter. With the line increasingly blurred between the applications that employees use at work and at home, the rise of BYOD and enterprise cloud vendors actively targeting consumers, it is not surprising that end users are using cloud applications, with or without the IT Department’s knowledge or permission. Once the application has gained traction inside an organization, the CIO’s hands are tied and they are forced by the business to consider an IT-sanctioned roll-out of the cloud application. Suddenly, there is a hybrid environment.

Some more forward thinking CIOs have embraced the cloud, but recognize that their legacy operation systems are not going to change. There is no business case that can be built on cloud-based cost savings alone, especially for the wholesale rip-and-replace of major operational systems like SAP and Oracle. But there are business opportunities to be had from a hybrid cloud environment.

There are benefits to move to cloud applications for some operational systems, for support systems such as HR or finance, and for office productivity and email. The challenge with this approach is that with a mixed environment, the users need to sign on to multiple systems. Behind the scenes, the data integration challenges also build as more cloud apps are implemented. This should be a simple business benefit vs. cost discussion. Some of the issues that need to be addresses were raised in an earlier article, The Cloud vs On-Premises Software: What you Need to Consider for your Business.

This is the majority of the marketing buzz you see around enterprises that are migrating to the cloud. They are starting with email and office productivity and moving into the periphery of operational systems like HR, finance, sales and marketing, and support.

The most adventurous CIOs see cloud as a resource rather than an application delivery platform. They use a cloud platform as Infrastructure-as -a-Service. That means that it is the natural extension of the private cloud, except it is (infinitely) scalable to cope with peaks or burst loading.

At its best, those systems being run on the private cloud can seamlessly consume public cloud resources to cope with the peak loading, as and when it is needed. It’s the perfect overflow capacity that is paid for only when it is used. In practice it is rather less seamless, but nevertheless valuable. When a known peak in volume is predicted, such as a TV ad running an offer, then the applications can be run on the public cloud where there is huge scalability. Clearly, this means that the applications have been designed to take advantage of cloud platform scalability.

Give me the simple life: born in the cloud

The easiest IT strategy moving forward is 100 percent cloud applications across the entire business. Described by some as “born in the cloud”, this approach means that there are no internal systems and databases to maintain, and limited infrastructure to support.

Whilst this seems like the perfect world, the role of CIO is very different from the traditional CIO or IT Director. It becomes more like a high level strategic architect and contract and vendor manager rather than head of infrastructure and R&D. These are very different skills, and the IT department can look top heavy with a high proportion of senior staff. This can impact the self esteem of an IT Director who measures their importance by the size of their team.

Opportunity = risk

With cloud, systems have effectively been outsourced, so there is a huge role to play by managing the risks of vendor failure. This is a critical part of vendor evaluation and management, but is often poorly done. Get this wrong and there are more than just security risks. There are also corporate compliance and reputational risks that need to be managed.

Vendor evaluation is critical, but it is particularly difficult where the vendor may have, in turn, outsourced some of their responsibilities to third parties who in turn have bought in services. For example, a cloud application vendor may use a third party for hosting. But that hosting company may use a third party for disaster recovery or backup. Suddenly, there is a chain of back-to-back contracts. It is not good enough to hope that those contracts and SLAs all dovetail neatly… because they probably don’t.

Of course, you don’t need the cloud to be exposed by poor vendor evaluation problems. Over 30 years ago I was an IT Director of one of the largest UK Government Departments. When performing a QA for a project integrating two key customer systems, it was identified that they were using a small piece of ‘bridge’ software that was critical to the integration.

When asked about the software, no-one seemed to know much about the company providing it. So they phoned the number on the brochure (no websites then).  It was answered by a middle-aged woman who openly admitted she knew nothing about software. When asked for one of the Directors of the company by name she said, “Oh. He went out with his brother last night. He probably got drunk as he hasn’t come home yet.” It was 11am, so she was casually asked how old he was.  “He’s 18 and his brother is 20, and yes they did write computer programs up in their bedroom”, she confirmed.

Panic stations and red faces were all around the Department. Quickly, they purchased the source code and got a team up to speed on the code. Fortunately, it was written in a language which was a standard for the Department. Ouch.

It is the role of the CIO to make sure that they are comfortable in how the service, end-to-end, is being delivered and that it meets the company’s IT strategy, security and compliance standards.

The new hybrid CIO

As every enterprise starts to use the cloud in a small or large way, they are embarking on a hybrid cloud strategy. For many CIOs who were excellent R&D managers and then IT Directors, the cloud means that there is a set of additional skills that they need to master.

Welcome to the new world of the hybrid CIO.

Image credit: Shutterstock

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