Building Return on Investment from Cloud Computing – Discussion: The Importance of a Business Perspective of the Cloud
From a business perspective, the way an organization operates differentiating business processes and their Quality of Service (QoS) is key to business operating success. Identifying competitive business processes as well as standard commodity operations will improve the focus of innovative market growth and cost of service optimization activities made possible by business models based on Cloud Computing opportunities.
Just focusing on infrastructure improvements may result in cost rationalization but may miss the impact and value of applications and business processes to the end customer. QoS is an essential ingredient in evaluating the business effectiveness. The elements of QoS are made up of infrastructure, resources, activities, and services spanning the whole lifecycle of business.
Amortization of Economies of Scale
In Cloud Computing the operating challenges experienced from one customer can be proactively fixed for all the other customers of the Cloud service by using a shared platform. Amortization of problems is just one example of how a Cloud solution can achieve more favorable QoS levels. So, value can be leveraged from amortizing economic economies of scale across the collective membership potential of a service ecosystem created by the Cloud.
Business Portfolio Focus
Just looking at Cloud Computing from a technical infrastructure point of view is potentially missing the wider picture of the impact of technology on the business.
Overall, what matters is defining the value to business. Value can be defined in many ways. It does not just mean the financial values of Total Cost of Ownership (TCO) and Return on Investment (ROI), but can also mean customer value, seller provider value, broker value, market brand value, corporate value, as well as technical value of the investment.
Your business is a portfolio of business processes. Using portfolio management techniques, group your business processes into three domains where the processes in each domain have common IT enablement solution selection criteria (for example, differentiating based on IT, differentiating not based on IT, and not differentiating), and apply the solution selection criteria.
The business perspective also includes consideration of whether using Cloud services can help facilitate interactions with business partners or partner organizations – for example, by using SOA or EDI through the Cloud – and whether using Cloud services may endanger any existing interactions, where suppliers of data impose particular conditions for handling confidential data.
The work of the Cloud Business Artifacts (CBA) Project in The Open Group Cloud Computing Work Group is seeking to identify the key Cloud buyer questions and in a language business can understand and use to target solutions to meet real business requirements.