Wednesday, February 11, 2009

What Should Go In The Cloud?

Cloud computing is all the rage. Vendors are falling over themselves to offer services from the cloud. Analysts are proclaiming that the cloud is the next big thing. So given that cloud based services provide economies of scale that most businesses can’t dream of, we should be pushing all of our services in to the cloud rather than provisioning them ourselves, right?

Let’s consider an example from the last programme that I worked on. In that programme a national single sign on (SSO) solution was provided as an external service (in the cloud in fashionable parlance). This ensured a single identity across NHS organisations, allowing users to cross organisational boundaries with a single identity. Great idea. One minor problem: if for any reason this external service was unavailable, users were not able to log in to any of their applications, and users already logged in had their sessions terminated. Unavailability of that single service impacted all other business applications.

What seemed like a great idea at the time, did not really stand up to scrutiny in practice. Of course hindsight is a great tool so I am not criticising the original design choice, but trying to learn from it. Using this example it is obvious that not everything should be in the cloud - operational considerations need to be traded off against financial benefits. So how do we decide what should go in the cloud and what we should deliver ourselves?

There are a number of dimensions to this. The first consideration is the business’s value chain. Any secondary activity in the value chain is a candidate for delivery via the cloud. For example, HR systems, intranets etc. What about primary activities? Instinctively these should be delivered internally. But if that is the case, how is it that salesforce.com has been so successful?? I think the answer is deeper: primary activities should be delivered from the cloud if they can so provide greater levels of quality and reliability than would be possible by delivering it internally. So for a large, mature organisation with a sophisticated IT operation, delivering CRM internally might make sense. For other organisations CRM via salesforce.com might make sense even though this is a primary activity for the organisation.

Returning to my SSO example then, for those NHS organisations for whom SSO is too complicated a task it makes sense to deliver this from the cloud. For larger, more sophisticated NHS organisations, internal delivery of SSO might be appropriate. That just leaves the problem of interoperability...for a later blog!

2 comments:

Andy Brett said...

And the choice isn't always as simple as 'in the cloud' or 'local'. In your SSO example, one of the primary objectives of centralisation was single user account management across the whole national organisation. Localising the solution effectively results in requiring a federated approach, which leads to replication, alignment and recency of information challenges.

Paul Mukherjee said...

Agreed!

The challenge as ever is to understand what the business problem is, and after that use technology to solve it. Cloud vs local should be part of the technology solution, not the starting point for the business problem.