IT organizations of Small-Medium Enterprises (SMEs) use a variety of providers to support their diverse business needs:
While this list is not complete, it clearly demonstrates that SMEs are likely to obtain products, services and solutions from a variety of providers.
Putting this into the context of SMEs considering adopting Cloud services, one of the inhibitors for SMEs to rely on Cloud services is trust and confidence in Cloud service providers and related offerings. With all these different providers, to whom should SMEs turn when it comes to sourcing Cloud services?
The fact is that the Cloud services market is crowded and has many players. SMEs will find Cloud service offerings from almost all of the above listed types of providers. To make things even more complicated, “one size doesn’t fit all” is true in this context as SMEs will be challenged to find the one single Cloud offering that can meet all of their IT needs.
So what does this mean? SMEs adopting Cloud services have to run a hybrid sourcing model. To illustrate this a little bit more, SMEs should be prepared to run some of their IT stack in-house while other IT capabilities are being provisioned from various service providers. In essence, the IT organizations of SMEs become an IT service broker, sourcing services from internal and from external service providers. Figure 5 provides a visual depiction of Cloud sourcing strategies.
Cloud Sourcing Strategies
As stated earlier, the Cloud services market is crowded. The upside of this is that SMEs can select Cloud services from countless providers and from a huge variety of Cloud offerings. The downside is that it makes it difficult for IT organizations of SMEs to find the viable Cloud provider that specifically meets their needs.
To get some structure into this decision area, IT organizations of SMEs should classify their needs into established Cloud services categories: Infrastructure as a Service (IaaS), Platform as a Service (PaaS), Software as a Service (SaaS), and Communication as a Service (CaaS). Although this list is not complete, it represents the most common Cloud services that are available today. In principle, every aspect of an SME’s IT needs may want to be consumed as a service and the IT and telecommunications industries are working diligently at putting these “Everything as a Service” offerings into the market.
IaaS definitely is the least disruptive Cloud service that an SME can adopt. It is at the very bottom of the IT stack and serves as an enabler for the Cloud services above such as PaaS or SaaS. Cloud providers in the IaaS space compete on their performance, their pricing, and their SLAs. Some example Cloud services that IaaS providers offer that are relevant to SMEs are:
PaaS is interesting for SMEs who want to develop applications but don’t want to invest heavily in development environments (i.e., hardware, operating system, development software) and don’t want to operate it from in-house. In general, PaaS can provide services for the entire lifecycle of applications, from design to retirement.
SaaS appears to provide the most value to SMEs. Why? Because SaaS supports the “plug and go” concept where IT organizations of SMEs source applications from public Cloud service providers and make them available to their consumers. This is the scenario where IT organizations of SMEs literally become IT service brokers. The list of SaaS offerings is endless. So are the providers. On the other hand, this scenario is the most disruptive for IT organizations to adopt unless the SME business is in start-up mode and has no existing software stack and data. Otherwise, IT organizations need to find a way of migrating existing data from the in-house applications onto the public SaaS environment. Many Cloud providers offer migration services to overcome this exact hurdle. To list a few common SaaS offerings:
And many more …
CaaS allows SMEs to take advantage of communication services like VoIP (Voice over IP) or UC (Unified Communications), and in cases where SMEs are Communications Service Providers (CSPs), CaaS provides a platform for not only service consumption but enables them to better bundle and resale services to meet company-specific market demands. As with all Cloud services, this means there is no need for the SMEs to make hardware investments. Instead, the Cloud provider takes care of the infrastructure, from hardware to software to managing the solution.
In essence SMEs have a wide range of Cloud services at their disposal. It is important for IT organizations of SMEs to do their homework first and go through the applications and workload analysis. This analysis helps IT organizations to build a business case for adopting Cloud services. Moreover, it provides clarity as to what types of Cloud services are targeted and what deployment model best suits the requirements.