The Growth Trajectory of Cloud what is it really costing you?

The growth trajectory of Cloud has been well documented, you’d be pretty hard pressed not to be able to find a reference to the increase in adoption worldwide. Pretty much every IT vendor is vying for a place in the race to cloud adoption. We are at a unique inflection point with a mass of opportunity ahead of us as providers, vendors, sellers and enablers of IT, as consumers continue to drive us toward innovation, as we continue to strive for faster, more efficient, more effective, cheaper ways to do, well, everything! The opportunity that the cloud presents to enable, scale and efficiencies that have been previously unavailable to many is disrupting the fabric of the way we have done business to date and literally opening up a world of opportunities.

To steal a phrase from the recent Cisco report Impact of Cloud IT Consumption models “One of the clearest expressions of this cloud-driven change is the emergence of lines of business (LOBs) — human resources, sales, R&D, and other areas that are end users of IT — both as direct consumers of cloud-based services, and as ever more prominent influencers of companies’ IT agendas. IT as it were, is no longer the domain of the IT department, it has permeated the entire organisation and is becoming an increasing challenge for those responsible for budgets and finance to truly understand the cost of the Cloud.

Your cloud, your way is very real in the current world of private, hybrid and public cloud offerings and pretty much every software product you purchase today can be consumed across all three however there is an ever increasing push to fully managed software as a service (SaaS) products and services and the global SaaS market is projected to grow from $49B in 2015 to $67B in 2018. Source: Technology Business Research presentation The Developer’s Coup: 2015 Applications Development Demands and Vendor Opportunities.

“Cloud computing continues to grow at rates much higher than IT spending generally,” Gartner research director, Ed Anderson, said. “Growth in Cloud services is being driven by new IT computing scenarios being deployed using Cloud models, as well as the migration of traditional IT services to Cloud service alternatives.”

While the move to the cloud has a myriad of considerations there is one that I liken to the early days of the mysterious internet charges and data download charges (although some would argue they still don’t understand these). Do we really know the true usage costs of cloud?

I run a professional services company called SixPivot and product company, Cloud Ctrl and our customers consistently ask the following:

  1. We are about to start our cloud journey and I’ve looked at the efficiencies cloud will provide us, but I have not thought about the true and increasing nature of cloud consumption.
  2. How do I know which public cloud provider is best for me and will truly offer best pricing on consumption?
  3. We are looking for SaaS solutions but we understand that there will be a cost for the cloud usage of those solutions but few software companies can articulate those costs to me.

Independent Software Vendors who have adopted Cloud Ctrl say:

  1. As a SaaS provider I really don’t know what I should be charging my customers, I am unsure how much consumption my product or service will use
  2. We are working on a number of projects that will be enable IOT for our customers but we are unable to model what the consumption data will look like
  3. There is an emergence of an entirely new class of business models based on smart machine technologies, advanced analytics and big data run in the cloud as a business we need to provide our solutions on these pillars but at what cost?

In the Cisco report “Impact of Cloud IT Consumption Models” note this report was written in 2013 and surveyed 4,226 IT leaders, across 18 industries and 9 key economies and yet the highlights, concerns and forecasts are still as relevant three years later in 2016 and for the most part business is still grappling to address these concerns

The below is taken straight from the report and still today represent two of the most common issues we see with our customers and why our customers are choosing Cloud Ctrl.

Cloud Cost Challenges Increase, but Optimization Efforts Lag

26 percent of respondents identify cloud cost management as a significant challenge in 2016, a steady increase each year from 18 percent in 2013.

Improving cloud cost management provides a significant opportunity for savings, since few companies are taking critical actions to optimize cloud costs, such as shutting down unused workloads or selecting lower-cost cloud or regions. The most common optimization action is monitoring utilization and rightsizing instances (45 percent of enterprises and SMBs). 36 percent of SMBs are purchasing AWS Reserved Instances (RIs) to save money, but only 21 percent are tracking purchased RIs to make sure that they are being fully utilized. When purchased RIs are not fully used, the savings decline, and the RI can even end up costing more than on-demand instances.

DevOps Grows and Docker Spreads Like Wildfire, Especially in the Enterprise

The twin trends of DevOps and cloud adoption are closely linked. As companies seek to drive digital business by delivering new software applications and features more quickly, they look to both DevOps and cloud as key enablers. DevOps is now being adopted by 74 percent of organizations, up from 66 percent in 2015.

As part of adopting DevOps processes, many companies choose to implement configuration management tools that allow them to standardize and automate deployment and configuration of servers and applications. In the last two years, companies have also begun to embrace container technologies, such as Docker, to help them standardize and streamline the way they package and deploy code.

Docker has shown phenomenal growth year-over-year, with more than double the number of respondents using it (from 13 to 27 percent). Ansible also doubled (10 to 20 percent), Puppet showed strong growth (24 to 32 percent), and Chef grew as well (28 to 32 percent).

Through the work we do in our consulting business to lift and shift customer products to the cloud not only as an IaaS solution but as a PaaS, SixPivot built Cloud Ctrl as an enabler product for our customers based on the ongoing challenges in understanding the true cost of cloud solutions.


About the Author

Faith Rees is the co-founder and CEO of SixPivot. Faith has worked in the Australian IT industry for the past 18 years across a variety of roles from sales and marketing to general management, director and chief operating officer roles including holding board director roles. Much of her last 10 years in the industry has been involved in software development and vendor management. Faith is a strong believer in giving back to the ICT community through, through her role as an advocate for the IT industry, Faith also serves on a number of government and industry committees. Faith is an advocate for diversity and in particular supporting women in their careers, she is a member of Women on Boards, is a mentor for the WiT Board Readiness Program and is on the Advisory Committee for Diverse City Careers (DCC).

It’s not every day you get to share your startup experience with the PM.

The View from my Office – the incredible vale of a flexible workplace

Bradley Boveinis joined the SixPivot family a little over 6 months ago and knows first hand the value of a flexible workplace. Read his story….

You would be forgiven for thinking that’s not much of a view, let alone one worth writing about. It’s not the view from a luxurious high rise building overlooking the bay, it’s not a cool chill out area with a Foosball table, drinks fridge, and fancy coffee machines. It’s just me, on the recliner, in my lounge room. Rather boring, actually. But that’s my view, it has been my view for the last 5 weeks, and I wouldn’t trade it for all the free energy drinks in the world.

Now, like many people who work from home, I have a home office. In my home office, I have my comfortable leather office chair, a large desk, a fancy mechanical keyboard, stereo system, 3×24″ monitors, noise cancelling headphones, emergency whisky, and all the other little luxuries one requires for a highly productive, distraction free, work environment. My home office, however, is currently completely useless to me.

You see, 5 weeks ago, I was in a remote part of Queensland on holidays with family and friends. We were in what was considered one of the ‘back paddocks’ of a 150,000 acre cattle station. A rough, rarely visited part of the property with paddocks full of dense mulga forests interrupted by the occasional dirt track. We were about 1 to 1½ hours’ drive from the homestead, and another 2 hours from the nearest town, depending on who was driving at the time, of course. It was late on a Thursday afternoon, sunset wasn’t far away, we were on our way back to the quarters when I was involved in a fairly serious accident. The short story is, I managed to roll a quad bike, and in the process, put an 8cm deep hole in the upper part of the calf of my right leg right through my gastrocnemius and into the soleus muscle behind it. On top of this, 350kgs of angry quad bike decided my knee was a nice resting place for the back tyre when it came down to settle. This little stunt of mine landed me 3 nights in hospital, a flight with the Royal Flying Doctors, surgery, a free set of crutches and moon boot. Oh, let’s not forget the ongoing weekly physio appointments.

My leg had swollen to about twice it’s normal size, with all different shades of purple, blue and yellow. I had gravel rash on every part of my body, with the worst being on the right hand side, and of course there was the hole in my leg. My head was fine, I was wearing a helmet, luckily.

It was 3 days after I was discharged before I could manage to hobble around confidently with the assistance of crutches. It was week and a half before I could get around without crutches, relying entirely on the moon boot. At 2 weeks the moon boot came off and the stitches came out, and I was back to relying on crutches again until I built up the strength in my ankle. It was around week 3 when I could hobble about the house without the need of crutches or the moon boot, and progress since has been measurable but slow. I still have swelling around my knee that prevents a lot of movement (at last physio check-up, I could only bend my knee 65 degrees).

Tomorrow marks week 5, and I still have to keep my leg elevated. If my knee falls below the level of my heart, the blood gradually fills all the contusions in my leg increasing the swelling and discomfort. Even with the compression bandage, once elevated, it can still take hours to drain back to a comfortable level. I still haven’t had an uninterrupted night sleep since the accident, averaging around 4-6 interruptions each night as I try to find a new comfortable position to lie in. Every day activities I used to take for granted are still a challenging task, but they get easier with each passing week. However, I’m still unable sit in a chair for more than 10 minutes at a time without experiencing great discomfort.

But, for all the physical impairment, I have only needed to take one day off work – a day when the pain was too great and I was unable to sleep the night before. This is possible because of the arrangement SixPivot has with our clients. It was also something I never saw mentioned when reading about the benefits of working from home. How many people plan to spend 10 weeks, stuck at home, recovering from an accident resulting in unplanned surgery? I certainly didn’t. How would it affect you if you were unable to work for months at a time? For some employers I have worked for in the past, I don’t think I would have a job to go back to after my holidays had run out. This would have forced me to return to work early, which could be disastrous for my recovery. I have income protection, sure, but that could take months before it is paid out, and by that time I would be selling off assets and investments just to make ends meet.

I have read that working from home can equate to the same happiness as a $55,000 pay increase. I’m not sure how someone came to that figure, but I can say it offers something worth more than that. Working from home has allowed me to maintain a stable income, when I would have otherwise not been physically able to do so, and when I needed it the most. We’re a single income household. While my girlfriend finishes her engineering degree, all financial obligations fall on my shoulders. It has also helped me stay occupied and focused when the limit of my abilities was to lie in bed with my leg on a pile of pillows. There were days when all I did was work, or sleep. With nothing but the usual necessary hygienic rituals in between. I was unable to do anything more. Now I can hobble around a bit more, and I’ve graduated to the recliner in the lounge room, but I would still be unable to work on site. If I could last the duration of the commute, I have not worked at a client that catered for people who needed to keep their leg elevated at all times. At least at home, if the discomfort becomes too much, I just go take a break and rest it until I am good again. I can recover at my own leisure, and the stress of urgency to return to work is lifted off my shoulders.