INFORMATION TECHNOLOGY AS A SERVICE (ITAAS)

INFORMATION TECHNOLOGY AS A SERVICE (ITAAS)

 

Information Technology as a service (ITaaS) is a technology-delivery method that treats IT as a set of defined services, providing an organization with exactly the amount of hardware, software, and support it needs for an agreed-on monthly fee. IT service delivery is undergoing a seismic shift in its operating structure. Cloud computing has established next-gen infrastructure benchmarks, which present an entirely different set of challenges for the hardware-designed legacy infrastructures.

With ITaaS, technology solutions can be deployed as needed, when needed, and bill for only what is used. This allows IT to be a strategic enabler to the business, but allows users of technology services to take control of the process and work at their own speed.

Technology as a Service is a unique financing opportunity that gives you the technology hardware, software and service that you want without having to pay for it right now. You can spread the payments out over three years with 0% interest and the option to either buy your equipment, or replace with new at the end of your contract.

Today, 70% of the world economy has become services, and this percentage continues to grow worldwide. The United States produced 79% of its 2010 GDP in services. Majority of the companies believe that by 2020 they will be competing primarily on service basis. As the service shift sweeps across all corners of the economy, it brings both opportunities and threats to companies that produce and sell technology products. Many companies that make industrial equipment, scientific instruments and computing devices are seeing their margins shrink relative to the prosperity in adjacent service businesses. It is no surprise that such traditional product companies are seeking a “service strategy”.

For many organizations, this approach creates a dramatically different outside-in view of IT and business resources. When ITaaS is used effectively, the resulting solution drives transformation through the enterprise and helps IT evolve from a tactical role to strategic one that potentially leads to a competitive advantage.

In technology, the boundary between hardware and software is blurring. Software is infiltrating more and more technology products that used to function only by mechanical rules and analog signals. Google has created a driverless car that navigates itself with sensors and software. This trend is not stopping. Hardware-based technology companies often find themselves falling behind their innovative software counterparts in identifying new value for customers. In more dramatic cases categories of hardware technology got replaced by software. No one still buys radio or CD player anymore. Today software is threatening to replace hardware-based networking. The “commoditization trap” for hardware seems impossible to escape without a product strategy backed by software innovation.

The growing dominance of services and the disruptive innovations of software are the two megatrends that will shape all technology businesses in the next decade. To continue their success, hardware-based product companies need software and service transformations. Such transformation requires new approaches in how technology is developed, delivered, commercialized and consumed. This approach, which we callTechnology-as-a-Service (TaaS), is the rising future for technology sectors. This model has already been showcased in the computing industry. Today’s most successful companies in this industry are no longer HP or Microsoft, but are companies like Salesforce, Amazon and Google. Salesforce is well known for its Software-as-a-Service (SaaS) success. Amazon has expanded itself into Infrastructure-as-a-Service (IaaS). Google has always made available its technologies as services and are coming out with more services for enterprises.

Simply put, service is economic transactions of value without ownership transfer of the underlying asset(s) from the provider to the customer. TaaS is proprietary technology empowered by software and provided as “services”. Unlike the traditional generation of labor-based services, the services of TaaS are highly software-enabled, on-demand, customizable to business contexts, and often virtually delivered by a system of hardware, software and people. Unlike in traditional product model, TaaS uses technology tools to deliver dynamic functions and solve business problems in close collaboration with customers. A TaaS based business model uses software to increase its functional versatility, and leverages ecosystem to expand the scale of value created for the customer.

There are 10 important characteristics that set TaaS apart from traditional technology products and traditional services.

1. Technology anchor.Unlike conventional service providers, a TaaS provider develops and owns proprietary technologies.
2. Maintaining ownership.Services are delivered without fully transferring ownership of the underlying assets.
3. Services should be unique to customer needs and can be customized accordingly.
4. Traditionally, obtaining services but not ownership from assets often indicates sharing and the sacrifice of privacy. The printing service at FedEx is shared and non-private. TaaS however provides customers exclusivity without ownership. Exclusive service is a service rendered in a private and secure environment, where a customer has complete control on functions without interference from other customers.
5. On demand.On demand means a resource or function can be activated and/or scaled whenever the business situation requires.
6. Consumption-based transaction model.This means services are charged only when used, and the transactional unit can be counted at at micro level of functional usage.
7. Virtual delivery.TaaS services are often delivered by a system consisting of machines/devices, data, applications, people and processes. Such service delivery assets should be freed from locational constraints whenever possible.
8. In context.Unlike traditional technology products, which have features fully baked into shape coming out of factory, TaaS needs to deliver functions that are responsive to and shaped by business contexts.
9. Modular means a component or function is self-contained with standardized interfaces, so that it can be utilized to build different systems or run disparate processes.
10. Software-defined functions.Traditional hardware-based functions are fixed once out of the factory. From the customer’s perspective, software-defined technology functions are extensible and programmable; they have the flexibility to serve multiple purposes and create cross-functionality processes.

In the next decade, TaaS will become the dominant model to commercialize technology. Apple transformed its business and then its industry by turning devices such as iPhone and iPad into personalized service hubs, supported by technology systems and business ecosystems. New technologies such as solar power and 3D printing are choosing TaaS models to go to market. Established technology companies including GE and Siemens are turning monitoring and diagnostics technologies into services.

TaaS is a proactive strategy against technology commoditization pressure, but it is also a strategic transition that must be carefully planned and executed. This is because a set of technical, commercial and operational capabilities would be required for TaaS, many of which can be new to product-based technology companies. A three-stepped approach, starting with “asset-based services”, moving to “function-driven services” and then to “business-defined services” allows a company to gradually build up capabilities towards a successful TaaS model. Companies that lead in this transition will create the future prosperity for the industrial sectors and the enterprise businesses.

 

The Great Cloud Takeover

The Great Cloud Takeover

In an amazingly short span of a couple or so years, Cloud Computing has become an integral, perhaps even the most vital part of an enterprise’s IT Strategy. It has helped free-up a huge chunk of the IT from the constrictions of legacy software and hardware licensing data center models, and has opened, revolutionized and to an extent democratized the way IT delivers services and how the users access information, applications and business services.

But with the ever increasing impact the cloud has on IT, there’s also a palpable confusion about how its full value to business can be harnessed, mainly because of the continuous and rapid evolution of the cloud and its related technologies and the growing flux of vendors using portentous hyperbolic marketing speak to sell their cloud solutions.

In 2014, workloads in the cloud surpassed workloads in traditional IT environments for the first time. Since then, there has been a flurry of unplugging and replugging into the cloud. Last August, Netflix announced it was shuttering the last of its data centers, making it one of the first large enterprises to run all of its information technology in the cloud. The Netflix shift has been in the works for more than seven years, triggered after the media streaming giant was hit with a major hardware failure in 2008.

In October, General Electric announced that 70 percent of its enterprise workloads would migrate to the cloud by 2020. GE bills the move as the biggest transformation in the company’s 130-year history. The objective? To position GE as the premier digital industrial enterprise. Moving to cloud applications, GE contends, frees up vast resources it can use to focus on differentiating itself from competitors. It’s a smart strategy for the enterprise looking to thrive on its way from traditional to new.

 

Cloud

Migration to the cloud has gone from a stream to a flood.

In 2014, workloads in the cloud surpassed workloads in traditional IT environments for the first time. Since then, there has been a flurry of unplugging and replugging into the cloud. Last August, Netflix announced it was shuttering the last of its data centers, making it one of the first large enterprises to run all of its information technology in the cloud. The Netflix shift has been in the works for more than seven years, triggered after the media streaming giant was hit with a major hardware failure in 2008.

In October, General Electric announced that 70 percent of its enterprise workloads would migrate to the cloud by 2020. GE bills the move as the biggest transformation in the company’s 130-year history. The objective? To position GE as the premier digital industrial enterprise. Moving to cloud applications, GE contends, frees up vast resources it can use to focus on differentiating itself from competitors. It’s a smart strategy for the enterprise looking to thrive on its way from traditional to new.

 

The Great Cloud Swell

This stream to the cloud is quickly becoming a swollen river. Indeed, traffic to the cloud will swell 33 percent annually over the next five years. By 2019, 86 percent of all workloads will be processed in the cloud. Just 14 percent will be performed in traditional data centers.

Internet traffic to the cloud is surging exponentially. Information flows between data centers are expected to grow at a much faster rate than traffic to end-users. And while the index projects overall cloud workloads are poised to grow at an annual rate of 27 percent between 2014 and 2019, public cloud growth is expected to top 44 percent annually. Private cloud (cloud services delivered to enterprises by their IT departments) workload growth will tick up at a much slower rate: 16 percent annually.

 

The Great Cloud Challenge

However, this flood to the cloud is not without challenges. Because cloud environments function fundamentally differently from the way enterprise IT typically runs—with different feature sets and management protocols—they introduce a layer of complexity. One solution is to integrate cloud and on-premise data center services—the hybrid cloud solution—under a single architecture supported by a single vendor.

The potential benefits are worthy of the journey. Migrating workloads to public or hybrid clouds delivers vastly more business value; value that manifests in terms of cost savings, flexibility, efficiency, and scalability. Yet, enterprises typically realize just 35 percent of this potential value, leaving 65 percent untapped.

Cloud is fast becoming a critical enterprise component. In this age of digital transformation, cloud means enterprise IT can focus on competitive differentiation, not digital plumbing. Ignore it at your peril.

 

Strategic Cloud Computing Trends that will drive cloud strategies through 2016 and 2017.

 

• Hybrid Cloud Computing Is The Way Forward

Hybrid Cloud Computing means using a combination of public or private cloud services and physical application infrastructure and services.

As is evident from some recent developments/deployments, hybrid cloud computing is set to become an imperative, in the form of a unified integrated cloud model, consisting both internal and external cloud platforms that can be leveraged based on specific business requirements.

Industry Analysts and Cloud Experts recommend that enterprises should center immediate efforts on integrating the application and dynamic data infrastructures to form a hybrid solution. To avoid oversights and other glitches, they should set guidelines and standards for how the public cloud application services or applications will combine with the various components of internal systems to ensure an efficient hybrid environment.

• Cloud Services Brokerage Is Going To Be A Key Strategic Role Of IT

Over the last year, Cloud Services Brokerage (CSB) has graduated from being an option to a key strategic factor for users and IT alike. CSB essentially involves a service provider playing a liaising role in assisting the consumption of cloud computing. CSB as a trend is predicted to gather speed over the next couple of years as users choose to use cloud services, independent of IT bureaucracy.

So what the IT critically needs to do to uphold its relevance and significance is to find ways to position itself as an Enterprise CSB by creating simple, flexible, and business user-centric tools and processes (for instance modifying internal portals and service catalogs) that facilitate cloud adoption and encourage end users to seek IT’s assistance.

• Cloud Friendly Decision Frameworks Are A Business Imperative

Even the greatest skeptic now agrees that Cloud Computing offers a plethora of completely indispensible features and benefits, like cost-effective use-based models of IT consumption and service delivery, greater agility and lesser complexity. It also allows the IT to focus its resources on delivering new services that fuel innovation and accelerate the business.

Yet, the success of your cloud adoption completely depends on whether your decision making structure optimizes the gift of the cloud. You need to first ensure you alleviate any concerns that you have regarding the performance, security, availability, and integration. Once you’ve satisfyingly crossed these issues, you can go about planning, implementing and optimizing your cloud strategy.

• Application Design Must Be Cloud-Optimized

Now the way organizations go about cloud computing is to basically just transfer their enterprise workloads to the cloud or an application infrastructure. This is a good approach where the workloads need a variable supply of resources or where the application logically adapts to horizontal scalability.

But to fully extract the potential of your cloud model to deliver truly gold standard world class applications, you need to start designing applications that are cloud-optimized from paper to practice.

• Future Datacenters Need To Adopt Implementation Models Of Cloud Service Providers

In a cloud computing environment, the data center and other implementation details are handled by the service provider while the enterprise only concerns itself with service consumption.

But as enterprises carry on building/expanding their own data centers, they will be far better served applying the cloud computing implementation models of Cloud Service Providers to increase performance, efficiency, and agility.

Thanks and Regards

Vijay Jain

+91 9870291860