Cloud and Social infrastructure innovation

The first hype-driven stage of cloud adoption has already passed. CIOs now need to prepare for a second stage of on-demand technology, based around flexible infrastructure services tailored to the requirements of specific sectors - so says Hitachi Data Systems (HDS) CTO Francois Zimmerman

The first hype-driven stage of cloud adoption has already passed. CIOs now need to prepare for a second stage of on-demand technology, based around flexible infrastructure services tailored to the requirements of specific sectors.


That is the view of Hitachi Data Systems (HDS) CTO Francois Zimmerman, an executive who drives innovation for the technology giant across Europe. He describes this first phase of cloud adoption as the ‘if you build it they will come’ approach and believes it has failed as it was not a sustainable strategy.


“Over the last couple of years we saw businesses pre-provisioning large blocks of infrastructure to enable private and community cloud offerings.” These dedicated blocks were purchased and deployed in fixed sizes rather than in an elastic, on-demand basis. As a result these internal cloud offerings were typically very under-utilised and CIOs had to carry a lot of financial risk while trying to cajole internal users into moving their services into this new offering.”


Zimmermann believes that this approach was also common in system integrators trying to provide shared services and that this led to significant losses as demand for these preprovisioned services often didn’t materialise when expected. He suggests a new approach is required, where CIOs are able to move towards the elastic procurement of services provided by real on-demand computing.


“CIOs need to start the process by thinking about how they procure their technology and then start thinking about how they relate to their suppliers. Everyone needs to get their heads around flexibility, both in terms of pricing and in terms of purchasing capacity on-demand.”


The business aim, suggests Zimmerman, should be to create tighter and more strategic relationships with vendor partners, where an increased amount of risk is passed to suppliers. He says CIOs should then be able to take advantage of cloud technology and grow their use of services as business demands change. “A more sustainable approach is to create a technological solution that relies on flexible resources,” says Zimmerman. “CIOs then only pay for IT as it is required. Get that approach right and the CIO’s infrastructure will have evolved to support change, rather than to act as a potential barrier to transformation.”


The end-user is a key factor in business change.


Smart CIOs are keen to provide the kind of transformation that allows users to access applications and information securely from any device and in any location.


Some IT leaders, however, feel hamstrung by compliance and fears about potential data leaks.


There was an early belief in the first stage of hype associated to on-demand IT that two or three large providers would dominate the cloud. This did not happen because their offerings were too broad and did not take into account the regulatory needs of specific sectors and geographies. But system integrators and resellers are in fact evolving to provide on-demand services that are tailored to the information security requirements of particular sectors, such as government and media. This type of community cloud, suggests Zimmerman, represents the future of flexible business IT.


“Vertical clouds make it easier for CIOs to take advantage of innovation,” says Zimmerman. “Once service providers have understood the sector-specific data boundaries of particular industries, CIOs are able to take advantage of a tailored approach that their business users can consume without concern.”

Zimmerman says HDS is working to develop the community cloud. The storage specialist is able to draw on the experience of the wider Hitachi Group, and its broad approach to social infrastructure innovation. The Group has already pioneered sector-specific developments in a range of areas, from healthcare to finance and from transport to utilities.


“There are a few companies in the marketplace that have a wider reach and they will be ableto deliver real value for particular sectors,” says Zimmerman. “That is where you’ll start to see real innovation in the cloud.”


He expects further innovation to come from deeper business intelligence. Hitachi has already worked with blue-chip finance companies, including the Tokyo Stock Exchange, and helped to drive the development of real-time analytics that are essential in algorithmic trading.


“What we’re moving towards is an intelligent IT infrastructure that takes data feeds from various sources and creates smarter endto- end processes,” says Zimmerman. “Once again, vertical specialism and experience is crucial. Your partners will be the key to developing an on-demand approach that provides benefits to the business.”

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