A quick Introduction to Cloud Computing

Today, IT usage by business is all pervasive. Whether it is in the form of Utilities that keep the wheels of business running or niche computing where in, IT is embedded in the business processes, optimized to bring value and competitive differentiation - most shades of IT usage by business is here to stay.

Even then, self integrating, owning and maintaining IT internally has been a tough call for firms. In retrospect, The journey so far of IT organizations appears to be more of a labyrinth which branches onwards in complex and confusing ways. If we take the case of IT assets purchases such as hardware, software and licenses, buyers are increasingly preferring standardisation over customization in a bid to cut costs. The automation of internal business processes, connectivity with suppliers, partners and customers usually spawns a whole range of specialized enterprise wide applications, infrastructure and services, which may be sourced from one or more vendors. Unfortunately, the business environment changes too fast for the monolithic IT organization to keep pace with.

Outsourcing has stepped in to address this pain point, but with continued pressure on margins, fixed rates and stringent Service Level Agreements ,which are contractual risk-reward related penalty clauses tied to performance of service delivery, outsourcers' agility has reached a tipping point. These vendors are stepping up all the guns,trying out more radical engagement models, innovative solutions and global delivery.

Beyond these dire moves, vendor strategists have to take a long range view to ensure continued success of the firm. In this backdrop, on the radars of vendors and rightly so, are the small specs of clouds appearing on the technology horizon. Cloud computing simply refers to broad range of technologies that help business information to reside on the internet and that are accessible from anywhere and at any time. Unfortunately, cloud confusion is also central issue because there are multiple definitions and vendors hype floating around preventing building up of common view.

Cloud computing is gaining adoption from bellwether clients. Most adoptions seem to have tested the waters with movement of emails and other less critical data. Still it is a positive sign. What remains to be seen is the how fast the security and multitenancy issues are addressed in a credible manner to assuage the concerns of sectors such as financial services, Insurance etc. Another barrier seems to be the issue of environment sustainability of cloud computing.

The benefits to the businesses are many. It helps free up resources and allows focus on strategic initiatives. It helps businesses to rapidly provision services in response to rising demand and scale down in leaner periods. Ideally, Cloud computing helps them to avail of IT as a variable cost. To provide maximum business value,Vendors need to tap into global innovation networks to rapidly package emerging technologies as standardized process bundles for a sector and offer it on pay as you go model. As noted above,the drive to reduce IT assets costs has led to the trend wherein Hardware and software purchases are increasingly standardized. Now,this trend of standardization is purported to extend to business processes for industries and widespread adoption of cloud computing is expected to further accelerate this trend