Cloud Buyers' Decision Tree : The Questions

 

Question 1: Is your Business Situation Vertical?

Decision Process for Question 1

Decision Process for Question 1

Objective

To identify whether your business scope is a vertical or horizontal business process in the industry domain of operation.

Decision

Definition

Next Decision

Objective

Yes:
Vertical

There are inter-dependencies between your business process, application, platform, and infrastructure layers. For example, your business processes rely on particular applications software. “Vertical” in this context does not refer to “industry vertical” or “geo vertical”.

Go to Question 2.

Determine which layers (see Question 6) should be outsourced; and – whether outsourced or in-house – for which layers should Cloud solutions be considered.

No:
Horizontal

No inter-dependencies between your business process, application, platform, and infrastructure layers

Go to Question 3.

Determine how much of each solution layer should be outsourced or in-house, and for which of those decisions should Cloud solutions be considered.

Previous Steps

None.

Question 2: Are the Processes Differentiating?

Decision Process for Question 2

Decision Process for Question 2

Objective

Identify if the Business Process is differentiating for the business. This is to determine whether the business drivers and performance of this process are critical to the competitiveness and cost-effective operation of the enterprise. Differentiating business process are the only processes for which a business case for in-house, custom, dedicated enablement independent of the rest of the business portfolio can be readily made.

Decision

Definition

Next Decision

Objective

Yes:
Differentiating

Processes which are integral to a business' competitive advantage.

Go to Question 7.

Keep competitors from adopting.

No:
Non-differentiating

Business-as-usual or external compliance processes which are not significant contributors to a business' competitive advantage.

Go to Question 3.

Keep investments to the minimum required and/or market parity.

Previous Steps

Question 1: Is your business situation vertical? Yes

Question 3: Are there Impediments to Outsourcing?

Decision Process for Question 3

Decision Process for Question 3

Objective

Identify any barriers or business and industry-specific location risks and government legislation issues that may prevent some or all of the layers of the process enablement from being outsourced.

Impediments to outsourcing include:

  • Complementary Requirements Profile to in-house differentiating requirements
  • Labor contracts
  • Long-term leases
  • Switching costs
  • Fixed assets with depreciation value
  • Immature business architecture
  • Business culture
  • Geographic location sovereignty rules
  • Industry Regulation
  • Compliance audit rules
  • Community relations

Decision

Definition

Next Decision

Objective

Yes:
Impediments to Outsourcing

Your business situation includes one or more of the Impediments to Outsourcing, such as long-term labor contracts and enterprise licenses; aspects of your business environment would impede an outsourcing solution.

Public Cloud is not a good fit unless the impediments to outsourcing are addressed. Go to Question 6.

Determine whether a private PaaS (Cloud) is a good fit.

No:
No Impediments to Outsourcing

Your business situation does not include any of the Impediments to Outsourcing; your business environment does not have aspects which would impede an outsourcing solution.

Go to Question 4.

Avoid pursuing a public Cloud or other form of outsourcing solution without first having addressed the impediments to doing so.

Previous Steps

Question 1: Is your business situation vertical? No

Question 2: Are the processes differentiating? No

Question 8: Is the differentiation IT-based? No

Question 10: Is the HW & OS custom (or specialized)? No

Question 4: Are there Impediments to Cloud Adoption?

Decision Process for Question 4

Decision Process for Question 4

Objective

Identify if the service has barriers to Cloud adoption through issues in hosting the service in a Cloud environment that may be detrimental to the process business drivers and return on investment (ROI) goals.

Considerations reviewed after Question 3: Impediments to Outsourcing. These impediments apply to Cloud solutions for various layers, and combinations of in-house (private) and public.

Impediments to Cloud adoption include:

  • Custom resources, no transformation planned
  • Standard resources, but not adaptable to one-to-many; transformation not practical
  • Policy restrictions on resource sharing and/or on control of configuration changes
  • Flat requirements profile, no fractional resources
  • Too few potential subscribers (not attractive market to providers)
  • Entry costs too high
  • Service Level Agreement (SLA) performance is not acceptable (9999's level)
  • The RPO and RTO performance is not acceptable

Decision

Definition

Next Decision

Objective

Yes:
Impediments to Cloud

Your business situation includes one or more of the Impediments to Cloud Adoption, such as a functionally adequate legacy application on fully depreciated custom hardware.

Cloud is not a good fit unless the impediments are addressed. Go to Question 5 to continue assuming that these impediments will be addressed.

Avoid pursuing a Cloud solution without first having addressed the impediments to doing so.

No:
No Impediments to Cloud

Your business situation does not include any of the Impediments to Cloud Adoption.

Go to Question 5.

Avoid pursuing a Cloud solution without first having addressed the impediments to doing so.

Previous Steps

Question 3: Are there impediments to outsourcing? No

Question 6: Will the solution be a platform? Yes

Question 5: Is the Primary Business Driver Cloud-Compatible?

Decision Process for Question 5

Decision Process for Question 5

Objective

Though there may not be any operational barriers to Cloud adoption, if the business objectives are not aligned with the inherent strengths and characteristics of Cloud solutions, then non-Cloud solutions will be a better fit for the business situation.

Cloud-compatible business drivers include:

  • Reduce medium and/or long-term TCO
  • Improve cash flow
  • Shift from CAPEX to OPEX (private Cloud-incompatible)
  • Improve QoS and/or SLAs
  • Access to functionality and/or domain expertise
  • Scale labor and/or fixed asset capacity up/down
  • Become a Cloud provider

Cloud-incompatible business drivers include:

  • Cut short-term costs
  • Shift from OPEX to CAPEX (public Cloud-incompatible)
  • Increase capacity without need for third-party financing
  • Change tax situation (recognize depreciation, job creation incentives, …)
  • Shift fixed assets (potentially including leases) and/or labor to provider

Decision

Definition

Next Decision

Objective

Yes:
Driver is on Compatible List

Cloud strengths match business objectives.

Cloud is a good fit. Review the previously selected Decision Nodes and Solution Considerations to determine which type of Cloud solution is the best fit.

Ensure strategic as well as tactical fit.

No:
Driver is on Incompatible List

Cloud strengths do not match business objectives.

Cloud is not a good fit. You may wish to consider out-tasking or non-Cloud outsourcing.

Avoid pursuing a suboptimal IT enablement strategy.

Previous Steps

Question 4: Are there impediments to Cloud adoption? No

Question 6: Will the Solution be a Platform?

Decision Process for Question 6

Decision Process for Question 6

Objective

Transform the layers below the application and business process layers into a standard, shared configuration for delivering all of the company's IT services.

Solution stack layers:

  • Business Process
  • Application
  • Middleware
  • Hardware and Operating System
  • Data Center Infrastructure

Decision

Definition

Next Decision

Objective

Yes:
Middleware and HW & OS

An IT platform is comprised of the Middleware and Hardware and Operating System Solution Stack Layers. The Data Center Infrastructure may also be included.

Go to Question 4.

Determine whether private PaaS (Cloud) is a good fit.

No:
HW & OS and/or Data Center

Horizontal HW & OS solutions include server farms, storage pools, and on-demand infrastructure. A data center includes network, physical plant, and a Network Operations Center (NOC).

Cloud is not a good fit, but other solutions such as virtualization, appliances, and out-tasking may be a good fit. Review Solution Considerations and consider Question 5.

Increase the yield of in-house IT infrastructure resources.

Previous Steps

Question 3: Are there impediments to outsourcing? Yes

Question 7: Is the Application Insulated from Changes to the Business Process?

Decision Process for Question 7

Decision Process for Question 7

Objective

Determine if the business process architecture can be customized without impacting the underlying standard application configuration and its shared IT management timeline, or if the IT configuration can be customized without impacting the execution of the business process with shared resources (especially labor) and using a standard process definition (architecture).

Decision

Definition

Next Decision

Objective

Yes:
Application is Insulated

Business process definition is abstracted from the enabling application such that a business person with no knowledge of the application can modify the definition of the business process without impacting the ability of the application administrator to manage and maintain the application efficiently.

Go to Question 8.

With insulation, delivery of the IT layers can be somewhat independent of delivery of the business process layer.

No:
Application is not Insulated

A change to the business process definition requires a change to the application, and vice versa.

Outsourcing (including public Cloud) is not a good fit, and by itself this business situation cannot support private cloud. To consider private PaaS, go to Question 4.

Avoid inhibiting changes to the differentiation; changes to a Cloud solution are made at the provider's convenience – whether the provider is internal or external. Insulation and control of change management may not be applicable to a process differentiated purely on scale (i.e., differentiation through commoditization). Private PaaS could be a good fit if the benefits of a common shared IT platform for this differentiating process and several non-differentiating processes, outweighs the benefits of enabling those non-differentiating processes with a public Cloud or non-Cloud outsourcing solution.

Previous Steps

Question 2: Are the processes differentiating? Yes

Question 8: Is the Differentiation IT-based?

Decision Process for Question 8

Decision Process for Question 8

Objective

Identify if IT is a key enabler of differentiation for the business process.

Decision

Definition

Next Decision

Objective

Yes:
Differentiation is IT-based

IT is integral to the differentiation.

Go to Question 9.

Improve IT enablement without enabling competitors to replicate the IT architecture on which the differentiation is based.

No:
Differentiation is not IT-based

IT merely supports the differentiating business process.

Business Process Outsourcing (BPO) is not a good fit. Go to Question 3.

Improve IT enablement without enabling competitors to replicate the business process architecture.

Previous Steps

Question 7: Is the application insulated from changes to the business process? Yes

Question 9. Are the HW & OS and Application Custom?

Decision Process for Question 9

Decision Process for Question 9

Objective

If both the HW & OS and Application layers are custom, then Cloud solutions are not a good fit; but if only one of the two layers is custom, then Cloud might be a good fit.

Examples of custom HW & OS and Application:

  • Mission Control Weapons System
  • Business Intelligence System

Decision

Definition

Next Decision

Objective

Yes:
Custom HW & OS and Application

The IT configuration must be managed on a unique timeline.

Cloud and most forms of outsourcing are not a good fit. Go to Solution Considerations.

Legacy IT solutions are often custom, so until a major transformation activity can be justified, Cloud is not a good fit.

No:
HW & OS and/or Application are Standard

Either the HW & OS or the Application layer is standard (off-the-shelf).

Go to Question 10.

Investigate the standard IT layer for Cloud fit.

Previous Steps

Question 8: Is the differentiation IT-based? Yes

Question 10: Is the HW & OS Custom (or Specialized)?

Decision Process for Question 10

Decision Process for Question 10

Objective

Identify which IT layer is standard, and therefore a potential candidate for enablement with a Cloud solution.

Examples of custom or specialized HW & OS, tailored application (“yes”):

  • Fault-tolerant
  • Hard real-time processor and OS
  • Special memory (supercomputer)
  • Cell processor

Examples of standard HW & OS, custom application (“no”):

  • Search engine
  • Information broadcast

Decision

Definition

Next Decision

Objective

Yes:
Custom or Specialized HW & OS, Tailored Application

The HW and/or OS are specialized, while the Application configuration fully or nearly matches the most typical configuration of that application.

Cloud and most forms of outsourcing are not a good fit. Go to Solution Considerations.

Re-evaluate the requirements necessitating custom HW and/or OS. And if the technology is early stage, then as it matures look for providers to start to support it.

No:
Standard HW & OS, Custom Application

The HW & OS but not the Application are configured in a typical fashion.

Go to Question 3.

Rule out Cloud solutions for the Application layer.

Previous Steps

Question 9: Are the HW & OS and Application custom? No

 

 

 

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