Showing posts with label multicloud. Show all posts
Showing posts with label multicloud. Show all posts

Wednesday, November 21, 2018

Dark Side of Cloud—How People and Organizations are Unable to Adapt and Improve the Business

Transcript of a discussion on how cloud adoption is not reaching its potential due to outdated behaviors and persistent dissonance between what businesses can do and will do with cloud model strengths.

Listen to the podcast. Find it on iTunes. Download the transcript. Sponsor: Hewlett Packard Enterprise.

Dana Gardner: Hello, and welcome to the next edition of the BriefingsDirect Voice of the Analyst podcast series. I’m Dana Gardner, Principal Analyst at Interarbor Solutions, your host and moderator for this ongoing discussion on the latest insights into hybrid IT and cloud computing.

Gardner
Many of our ongoing discussions focus on infrastructure trends that support the evolving hybrid IT continuum. Today’s focus shifts to behavior -- how individuals and groups, both large and small, benefit from cloud adoption.

It turns out that a dark side to cloud points to a lackluster business outcome trend. A large part of the disappointment has to do with outdated behaviors and persistent dissonance between what line of business (LOB) practitioners can do and will do with their newfound cloud strengths.

We’ll now hear from an observer of worldwide cloud adoption patterns on why making cloud models a meaningful business benefit rests more with adjusting the wetware than any other variable.

Here to help explore why cloud failures and cost overruns are dogging many enterprises is Robert Christiansen, Vice President, Global Delivery, Cloud Professional Services and Innovation at Cloud Technology Partners (CTP), a Hewlett Packard Enterprise (HPE) company.

Welcome, Robert.

Robert Christiansen: Thank you for having me, Dana.

Gardner: What is happening now with the adoption of cloud that makes the issue of how people react such a pressing concern? What’s bringing this to a head now?

Fits and starts 

Christiansen
Christiansen: Enterprises are on a cloud journey. They have begun their investment, they recognize that agility is a mandate for them, and they want to get those teams rolling. They have already done that to some degree and extent. They may be moving a few applications, or they may be doing wholesale shutdowns of data centers. They are in lots of different phases in adoption situations.

What we are seeing is a lack of progress with regard to the speed and momentum of the adoption of applications into public clouds. It’s going a little slower than they’d like.

Gardner: We have been through many evolutions, generations, and even step-changes in technology. Most of them have been in a progressive direction. Why are we catching our heels now?

Christiansen: Cloud is a completely different modality, Dana. One of the things that we have learned here is that adoption of infrastructure that can be built from the ground-up using software is a whole other way of thinking that has never really been the core bread-and-butter of an infrastructure or a central IT team. So, the thinking and the process -- the ability to change things on the fly from an infrastructure point of view -- is just a brand new way of doing things.

And we have had various fits and starts around technology adoption throughout history, but nothing at this level. The tool kits available today have completely changed and redefined how we go about doing this stuff.


Gardner: We are not just changing a deployment pattern, we are reinventing the concept of an application. Instead of monolithic applications and systems of record that people get trained on and line up around, we are decomposing processes into services that require working across organizational boundaries. The users can also access data and insights in ways they never had before. So that really is something quite different. Even the concept of an application is up for grabs.

Christiansen: Well, think about this. Historically, an application team or a business unit, let’s say in a bank, said, “Hey, I see an opportunity to reinvent how we do funding for auto loans.”

We worked with a company that did this. And historically, they would have had to jump through a bunch of hoops. They would justify the investment of buying new infrastructure, set up the various components necessary, maybe landing new hardware in the organization, and going into the procurement process for all of that. Typically, in the financial world, it takes months to make that happen.

Today, that same team using a very small investment can stand up a highly available redundant data center in less than a day on a public cloud. In less than a day, using a software-defined framework. And now they can go iterate and test and have very low risk to see if the marketplace is willing to accept the kind of solution they want to offer.

And that just blows apart the procedural-based thinking that we have had up to this point; it just blows it apart. And that thinking, that way of looking at stuff is foreign to most central IT people. Because of that emotion, going to the cloud has come in fits and starts. Some people are doing it really well, but a majority of them are struggling because of the people issue.

Gardner: It seems ironic, Robert, because typically when you run into too much of a good thing, you slap on governance and put in central command and control, and you throttle it back. But that approach subverts the benefits, too.

How do you find a happy medium? Or is there such a thing as a happy medium when it comes to moderating and governing cloud adoption?

Control issues

Christiansen: That’s where the real rub is, Dana. Let’s give it an analogy. At Cloud Technology Partners (CTP), we do cloud adoption workshops where we bring in all the various teams and try to knock down the silos. They get into these conversations to address exactly what you just said. “How do we put governance in place without getting in the way of innovation?”

It’s a huge, huge problem, because the central IT team’s whole job is to protect the brand of the company and keep the client data safe. They provide the infrastructure necessary for the teams to go out and do what they need to do.

When you have a structure like that but supplied by the public clouds like Amazon (AWS), Google, and Microsoft Azure, you still have the ability to put in a lot of those controls in the software. Before it was done either manually or at least semi-manually.
The central IT team's whole job is to protect the brand of the company and keep the client data safe. They provide the infrastructure necessary for the teams to go out and do what they need to do.

The challenge is that the central IT teams are not necessarily set up with the skills to make that happen. They are not by nature software development people. They are hardware people. They are rack and stack people. They are people who understand how to stitch this stuff together -- and they may use some automation. But as a whole it’s never been their core competency. So therein lies the rub: How do you convert these teams over to think in that new way?

At the same time, you have the pressing issue of, “Am I going to automate myself right out of a job?” That’s the other part, right? That’s the big, 800-pound gorilla sitting in the corner that no one wants to talk about. How do you deal with that?

Gardner: Are we talking about private cloud, public cloud, hybrid cloud, hybrid IT -- all the above when it comes to these trends?

Public perceptions

Christiansen: It’s mostly public cloud that you see the perceived threats. The public cloud is perceived as a threat to the current way of doing IT today, if you are an internal IT person.

Let’s say that you are a classic compute and management person. You actually split across both storage and compute, and you are able to manage and handle a lot of those infrastructure servers and storage solutions for your organization. You may be part of a team of 50 in a data center or for a couple of data centers. Many of those classic roles literally go away with a public cloud implementation. You just don’t need them. So these folks need to pivot or change into new roles or reinvent themselves.

Let’s say you’re the director of that group and you happen to be five years away from retirement. This actually happened to me, by the way. There is no way these folks want to give up the range right before their retirement. They don’t want to reinvent their roles just before they’re going to go into their last years.

They literally said to me, “I am not changing my career this far into it for the sake of a public cloud reinvention.” They are hunkering down, building up the walls, and slowing the process. This seems to be an undercurrent in a number of areas where people just don’t want to change. They don’t want any differences.

Gardner: Just to play the devil’s advocate, when you hear things around serverless, when we see more operations automation, when we see artificial intelligence (AI)Ops use AI and machine learning (ML) -- it does get sort of scary.

You’re handing over big decisions within an IT environment on whether to use public or private, some combination, or multicloud in some combination. These capabilities are coming into fruition.

Maybe we do need to step back and ask, “Just because you can do something, should you?” Isn’t that more than just protecting my career? Isn’t there a need for careful consideration before we leap into some of these major new trends?

Transform fear into function 

Christiansen: Of course, yeah. It’s a hybrid world. There are applications where it may not make sense to be in the public cloud. There are legacy applications. There are what I call centers of gravity that are database-centric; the business runs on them. Moving them and doing a big lift over to a public cloud platform may not make financial sense. There is no real benefit to it to make that happen. We are going to be living between an on-premises and a public cloud environment for quite some time.

The challenge is that people want to create a holistic view of all of that. How do I govern it in one view and under one strategy? And that requires a lot of what you are talking about, being more cautious going forward.

And that’s a big part of what we have done at CTP. We help people establish that governance framework, of how to put automation in place to pull these two worlds together, and to make it more seamless. How do you network between the two environments? How do you create low-latency communications between your sources of data and your sources of truth? Making that happen is what we have been doing for the last five or six years.
We help establish that governance framework, of how to put automation in place to pull these two worlds together, and to make it more seamless.

The challenge we have, Dana, is that once we have established that -- we call that methodology the Minimum Viable Cloud (MVC). And after you put all of that structure, rigor, and security in place -- we still run into the problems of motion and momentum. Those needed governance frameworks are well-established.

Gardner: Before we dig into why the cloud adoption inertia still exists, let’s hear more about CTP. You were acquired by HPE not that long ago. Tell us about your role and how that fits into HPE.

CTP: A cloud pioneer

Christiansen: CTP was established in 2010. Originally, we were doing mostly private cloud, OpenStack stuff, and we did that for about two to three years, up to 2013.

I am one of the first 20 employees. It’s a Boston-based company, and I came over with the intent to bring more public cloud into the practice. We were seeing a lot of uptick at the time. I had just come out of another company called Cloud Nation that I owned. I sold that company; it was an Amazon-based, Citrix-for-rent company. So imagine, if you would, you swipe a credit card and you get NetScaler, XenApp and XenDesktop running on top of AWS way back in 2012 and 2013.

I sold that company, and I joined CTP. We grew the practice of public cloud on Google, Azure, and AWS over those years and we became the leading cloud-enabled professional services organization in the world.

We were purchased by HPE in October 2017, and my role since that time is to educate, evangelize, and press deeply into the methodologies for adopting public cloud in a holistic way so it works well with what people have on-premises. That includes the technologies, economics, strategies, organizational change, people, security, and establishing a DevOps practice in the organization. These are all within our world.

We do consultancy and professional services advisory types of things, but on the same coin, we flip it over, and we have a very large group of engineers and architects who are excellent on keyboards. These are the people who actually write software code to help make a lot of this stuff automated to move people to the public clouds. That’s what we are doing to this day.

Gardner: We recognize that cloud adoption is a step-change, not an iteration in the evolution of computing. This is not going from client/server to web apps and then to N-Tier architectures. We are bringing services and processes into a company in a whole new way and refactoring that company. If you don’t, the competition or a new upstart unicorn company is going to eat your lunch. We certainly have seen plenty of examples of that.

So what prevents organizations from both seeing and realizing the cloud potential? Is this a matter of skills? Is it because everyone is on the cusp of retirement and politically holding back? What can we identify as the obstacles to overcome to break that inertia?

A whole new ball game

Christiansen: From my perspective, we are right in the thick of it. CTP has been involved with many Fortune 500 companies through this process.

The technology is ubiquitous, meaning that everybody in the marketplace now can own pretty much the same technology. Dana, this is a really interesting thought. If a team of 10 Stanford graduates can start up a company to disrupt the rental car industry, which somebody has done, by the way, and they have access to technologies that were only once reserved for those with hundreds of millions of dollars in IT budgets, you have all sorts of other issues to deal with, right?

So what’s your competitive advantage? It’s not access to the technologies. The true competitive advantage now for any company is the people and how they consume and use the technology to solve a problem. Before [the IT advantage] was reserved for those who had access to the technology. That’s gone away. We now have a level playing field. Anybody with a credit card can spin up a big data solution today – anybody. And that’s amazing, that’s truly amazing.

For an organization that had always fallen back on their big iron or infrastructure -- those processes they had as their competitive advantage -- that now has become a detriment. That’s now the thing that’s slowing them down. It’s the anchor holding them back, and the processes around it. That rigidity of people and process locks them into doing the same thing over and over again. It is a serious obstacle.

Untangle spaghetti systems 

Another major issue came very much as a surprise, Dana. We observed it over the last couple of years of doing application inventory assessments for people considering shutting down data centers. They were looking at their applications, the ones holding the assets of data centers, as not competitive. And they asked, “Hey, can we shut down a data center and move a lot of it to the public cloud?”

We at CTP were hired to do what are called application assessments, economic evaluations. We determine if there is a cost validation for doing a lift-and-shift [to the public cloud]. And the number-one obstacle was inventory. The configuration management data bases (CMDBs), which hold the inventory of where all the servers are and what’s running on them for these organizations, were wholly out of date. Many of the CMDBs just didn’t give us an accurate view of it all.

When it came time to understand what applications were actually running inside the four walls of the data centers -- nobody really knew. As a matter of fact, nobody really knew what applications were talking to what applications, or how much data was being moved back and forth. They were so complex; we would be talking about hundreds, if not thousands, of applications intertwined with themselves, sharing data back and forth. And nobody inside organizations understood which applications were connected to which, how many there were, which ones were important, and how they worked.
When it came time to understand what applications were actually running inside of the four walls of the data centers -- no one really knew. Nobody knew what applications were talking to what applications, or how much data was being moved back and forth.

Years of managing that world has created such a spaghetti mess behind those walls that it’s been exceptionally difficult for organizations to get their hands around what can be moved and what can’t. There is great integration within the systems.

The third part of this trifecta of obstacles to moving to the cloud is, as we mentioned, people not wanting to change their behaviors. They are locked in to the day-to-day motion of maintaining those systems and are not really motivated to go beyond that.

Gardner: I can see why they would find lots of reasons to push off to another day, rather than get into solving that spaghetti maze of existing data centers. That’s hard work, it’s very difficult to synthesize that all into new apps and services.

Christiansen: It was hard enough just virtualizing these systems, never mind trying to pull it all apart.

Gardner: Virtualizing didn’t solve the larger problem, it just paved the cow paths, gained some efficiency, reduced poor server utilization -- but you still have that spaghetti, you still have those processes that can’t be lifted out. And if you can’t do that, then you are stuck.

Christiansen: Exactly right.

Gardner: Companies for many years have faced other issues of entrenchment and incumbency, which can have many downsides. Many of them have said, “Okay, we are going to create a Skunk Works, a new division within the company, and create a seed organization to reinvent ourselves.” And maybe they begin subsuming other elements of the older company along the way.

Is that what the cloud and public cloud utilization within IT is doing? Why wouldn’t that proof of concept (POC) and Skunk Works approach eventually overcome the digital transformation inertia?

Clandestine cloud strategists

Christiansen: That’s a great question, and I immediately thought of a client who we helped. They have a separate team that re-wrote or rebuilt an application using serverless on Amazon. It’s now a fairly significant revenue generator for them, and they did it almost two and-a-half years ago.

It uses a few cloud servers, but mostly they rely on the messaging backbones and non-server-based platform-as-a-service (PaaS) layers of AWS to solve their problem. They are a consumer credit company and have a lot of customer-facing applications that they generate revenue from on this new platform.

The team behind the solution educated themselves. They were forward-thinkers and saw the changes in public cloud. They received permission from the business unit to break away from the central IT team’s standard processes, and they completely redefined the whole thing.

The team really knocked it out of the park. So, high success. They were able to hold it up and tried to extend that success back into the broader IT group. The IT group, on the other hand, felt that they wanted more of a multicloud strategy. They weren’t going to have all their eggs in Amazon. They wanted to give the business units options, of either going to Amazon, Azure, or Google. They wanted to still have a uniform plane of compute for on-premises deployments. So they brought in Red Hat’s OpenShift, and they overlaid that, and built out a [hybrid cloud] platform.

Now, the Red Hat platform, I personally had had no direct experience, but I had heard good things about it. I had heard of people who adopted it and saw benefits. This particular environment though, Dana, the business units themselves rejected it.

The core Amazon team said, “We are not doing that because we’re skilled in Amazon. We understand it, we’re using AWS CloudFormation. We are going to write code to the applications, we are going to use Lambda whenever we can.” They said, “No, we are not doing that [hybrid and multicloud platform approach].”

Other groups then said, “Hey, we’re an Azure shop, and we’re not going to be tied up around Amazon because we don’t like the Amazon brand.” And all that political stuff arose, they just use Azure, and decided to go shooting off on their own and did not use the OpenShift platform because, at the time, the tool stacks were not quite what they needed to solve their problems.


The company ended up getting a fractured view. We recommended that they go on an education path, to bring the people up to speed on what OpenShift could do for them. Unfortunately, they opted not to do that -- and they are still wrestling with this problem.

CTP and I personally believe that this was an issue of education, not technology, and not opportunity. They needed to lean in, sponsor, and train their business units. They needed to teach the app builders and the app owners on why this was good, the advantages of doing it, but they never invested the time. They built it and hoped that the users would come. And now they are dealing with the challenges of the blowback from that.

Gardner: What you’re describing, Robert, sounds an awful lot like basic human nature, particularly with people in different or large groups. So, politics, right? The conundrum is that when you have a small group of people, you can often get them on board. But there is a certain cut-off point where the groups are too large, and you lose control, you lose synergy, and there is no common philosophy. It’s Balkanization; it’s Europe in 1916.

Christiansen: Yeah, that is exactly it.

Gardner: Very difficult hurdles. These are problems that humankind has been dealing with for tens of thousands of years, if not longer. So, tribalism, politics. How does a fleet organization learn from what software development has come up with to combat some of these political issues? I’m thinking of Agile methodologies, scrums, and having short bursts, lots of communication, and horizontal rather than command-and-control structures. Those sorts of things.

Find common ground first

Christiansen: Well, you nailed it. How you get this done is the question. How do you get some kind of agility throughout the organization to make this happen? And there are successes out there, whole organizations, 4,000 or 5,000 or 6,000 people, have been able to move. And we’ve been involved with them. The best practices that we see today, Dana, are around allowing the businesses themselves to select the platforms to go deep on, to get good at.

Let’s say you have a business unit generating $300 million a year with some service. They have money, they are paying the IT bill. But they want more control, they want more the “dev” from the DevOps process.
The best practices that we see today are around allowing the businesses themselves to select the cloud platforms to go deep on, to get good at. ... They want the "dev" from the DevOps process.

They are going to provide much of that on their own, but they still need core common services from central IT team. This is the most important part. They need the core services, such as identity and access management, key management, logging and monitoring, and they need networking. There is a set of core functions that the central team must provide.

And we help those central teams to find and govern those services. Then, the business units [have cloud model choice and freedom as long as they] consume those core services -- the access and identity process, the key management services, they encrypt what they are supposed to, and they use the networking functions. They set up separation of the services appropriately, based on standards. And they use automation to keep them safe. Automation prevents them from doing silly things, like leaving unencrypted AWS S3 buckets open to the public Internet, things like that.

You now have software that does all of that automation. You can turn those tools on and then it’s like a playground, a protected playground. You say, “Hey, you can come out into this playground and do whatever you want, whether it’s on Azure or Google, or on Amazon or on-premises.”

 “Here are the services, and if you adopt them in this way, then you, as the team, can go deep, you can use Application programming interface (API) calls, you can use CloudFoundation or Python or whatever happens to be the scripting language you want to build your infrastructure with.”

Then you have the ability to let those teams do what they want. If you notice, what it doesn’t do is overlay a common PaaS layer, which isolates the hyperscale public cloud provider from your work. That’s a whole other food fight, religious battle, Dana, around lock-in and that kind of conversation.

Gardner: Imposing your will on everyone else doesn’t seem to go over very well.

So what you’re describing, Robert, is a right-sizing for agility, and fostering a separate-but-equal approach. As long as you can abstract to the services level, and as long as you conform to a certain level of compliance for security and governance -- let’s see who can do it better. And let the best approach to cloud computing win, as long as your processes end up in the right governance mix.

Development power surges

Christiansen: People have preferences, right? Come on! There’s been a Linux and .NET battle since I have been in business. We all have preferences, right? So, how you go about coding your applications is really about what you like and what you don’t like. Developers are quirky people. I was a C programmer for 14 years, I get it.

The last thing you want to do is completely blow up your routines by taking development back and starting over with a whole bunch of new languages and tools. Then they’re trying to figure out how to release code, test code, and build up a continuous integration/continuous delivery pipeline that is familiar and fast.

These are really powerful personal stories that have to be addressed. You have to understand that. You have to understand that the development community now has the power -- they have the power, not the central IT teams. That shift has occurred. That power shift is monumental across the ecosystem. You have to pay attention to that.

If the people don’t feel like they have a choice, they will go around you, which is where the problems are happening.

Gardner: I think the power has always been there with the developers inside of their organizations. But now it’s blown out of the development organization and has seeped up right into the line of business units.

Christiansen: Oh, that’s a good point.

Gardner: Your business strategy needs to consider all the software development issues, and not just leave them under the covers. We’re probably saying the same thing. I just see the power of development choice expanding, but I think it’s always been there.

But that leads to the question, Robert, of what kind of leadership person can be mindful of a development culture in an organization, and also understand the line of business concerns. They must appreciate the C-suite strategies. If you are a public company, keeping Wall Street happy, and keeping the customer expectations met because those are always going up nowadays.

It seems to me we are asking an awful lot of a person or small team that sits at the middle of all of this. It seems to me that there’s an organizational and a talent management deficit, or at least something that’s unprecedented.

Tech-business cross-pollination

Christiansen: It is. It really is. And this brings us to a key piece to our conversation. And that is the talent enablement. It is now well beyond how we’ve classically looked at it.

Some really good friends of mine run learning and development organizations and they have consulting companies that do talent and organizational change, et cetera. And they are literally baffled right now at the dramatic shift in what it takes to get teams to work together.

In the more flexible-thinking communities of up-and-coming business, a lot of the folks that start businesses today are technology people. They may end up in the coffee industry or in the restaurant industry, but these folks know technology. They are not unaware of what they need to do to use technology.

So, business knowledge and technology knowledge are mixing together. They are good when they get swirled together. You can’t live with one and not have the other.

For example, a developer needs to understand the implications of economics when they write something for cloud deployment. If they build an application that does not economically work inside the constructs of the new world, that’s a bad business decision, but it’s in the hands of the developer.

It’s an interesting thing. We’ve had that need for developer-empowerment before, but then you had a whole other IT group put restrictions on them, right? They’d say, “Hey, there’s only so much hardware you get. That’s it. Make it work.” That’s not the case anymore, right?
We have created a whole new training track category called Talent Enablement that CTP and HPE have put together around the actual consumers of cloud.

At the same time, you now have an operations person involved with figuring out how to architect for the cloud, and they may think that the developers do not understand what has to come together.

As a result, we have created a whole new training track category called Talent Enablement that CTP and HPE have put together around the actual consumers of cloud.

We have found that much of an organization’s delay in rolling this out is because the people who are consuming the cloud are not ready or knowledgeable enough on how to maximize their investment in cloud. This is not for the people building up those core services that I talked about, but for the consumers of the services, the business units.

We are rolling that out later this year, a full Talent Enablement track around those new roles.

Gardner: This targets the people in that line of business, decision-making, planning, and execution role. It brings them up to speed on what cloud really means, how to consume it. They can then be in a position of bringing teams together in ways that hadn’t been possible before. Is that what you are getting at?

Teamwork wins 

Christiansen: That’s exactly right. Let me give you an example. We did this for a telecommunications company about a year ago. They recognized that they were not going to be able to roll out their common core services.

The central team had built out about 12 common core services, and they knew almost immediately that the rest of the organization, the 11 other lines of business, were not ready to consume them.

They had been asking for it, but they weren’t ready to actually drive this new Ferrari that they had asked for. There were more than 5,000 people who needed to be up-skilled on how to consume the services that a team of about 100 people had put together.

Now, these are not classic technical services like AWS architecture, security frameworks, or Access control list (ACL) and Network ACL (NACL) for networking traffic, or how you connect back and backhaul, that kind of stuff. None of that.

I’m talking about how to make sure you don’t get a cloud bill that’s out of whack. How do I make sure that my team is actually developing in the right way, in a safe way? How do I make sure my team understands the services we want them to consume so that we can support it?

It was probably 10 or 12 basic use domains. The teams simply didn’t understand how to consume the services. So we helped this organization build a training program to bring up the skills of these 4,000 to 5,000 people.

Now think about that. That has to happen in every global Fortune 2000 company where you may only have a central team of a 100, and maybe 50 cloud people. But they may need to turn over the services to 1,000 people.

We have a massive, massive, training, up-skilling, and enablement process that has to happen over the next several years.

Gardner: I’m afraid we’ll have to leave it there. We’ve been exploring how a large part of the disappointment with cloud-based business outcomes has to do with outdated behaviors and even persistent dissonance between what line of business practitioners can do and what they should do with their new cloud strength.

And we’ve learned why making cloud models meaningful businesses rests more with the people, change management, and talent management than just about anything else.


Please join me in thanking our guest, Robert Christiansen, Vice President, Global Delivery of Cloud Professional Services and Innovation at Cloud Technology Partners, an HPE company.

Robert, thank you so much. I really enjoyed it.

Christiansen: Thanks, Dana. I did too. I hope to come back again.

Gardner: And thanks also to our audience for joining this BriefingsDirect Voice of the Analyst hybrid IT and cloud computing strategies interview.

I’m Dana Gardner, Principal Analyst at Interarbor Solutions, your host for this ongoing series of Hewlett Packard Enterprise-sponsored discussions. Thanks again for listening.  Please pass this along to your IT community and do come back next time.

Listen to the podcast. Find it on iTunes. Download the transcript. Sponsor: Hewlett Packard Enterprise.

Transcript of a discussion on how cloud adoption is not reaching its potential due to outdated behaviors and persistent dissonance between what businesses can do and will do with cloud model strengths. Copyright Interarbor Solutions, LLC, 2005-2018. All rights reserved.

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Tuesday, September 18, 2018

How Datacenter Adjacency and Global Partnership Ecosystems Propel Adoption of Hybrid Cloud

Transcript of a discussion on how Equinix, Microsoft Azure Stack, and Cloud28+ together are advancing and extending hybrid cloud options across the globe.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: Hewlett Packard Enterprise

Dana Gardner: Hello, and welcome to the next edition of the BriefingsDirect Voice of the Customer podcast series. I’m Dana Gardner, Principal Analyst at Interarbor Solutions, your host and moderator for this ongoing discussion on digital transformation success stories.

Gardner
Our next hybrid cloud advancement interview explores how the triumvirate of a global data center hosting company, a hybrid cloud platform provider, and a global cloud community are solving some of the most vexing problems for bringing high-performance clouds to more regions around the globe.

We will now learn how Equinix, Microsoft Azure Stack, and Hewlett Packard Enterprise (HPE)’s Cloud28+ are helping managed service providers (MSPs) and businesses alike obtain world-class hybrid cloud services.

Here to help us explore new breeds of hybrid cloud solutions is David Anderson, Global Alliance Director at Equinix for its Microsoft alliance.

Welcome, David.

David Anderson: Thanks for having me, Dana.

Gardner: We are also here with Xavier Poisson, Vice-President of Worldwide Services Providers Business and Cloud28+ at HPE. Welcome.

Xavier Poisson: Hi, Dana, thanks.

Interconnected cloud interactions


Gardner: It seems to me there is a paradox when it comes to the hybrid cloud -- that it works best in close proximity technologically yet has the most business payoff when you distribute it far and wide. So how are Equinix, Microsoft, and HPE together helping to solve this paradox of proximity and distribution?

Anderson
Anderson: That’s a great question. You are right that hybrid cloud does tend to work better when there is proximity between the hybrid installation and the actual public cloud you are connecting to. That proximity can actually be lengthened with what we call interconnectedness.

Interconnectedness is really business-to-business (B2B) and business-to-cloud private network Ethernet connections. Equinix is positioned with more than 200 data centers worldwide, the most interconnections by far around the world. Every network provider is in our data centers. We also work with cloud providers like Microsoft. The Equinix Cloud Exchange connects businesses and enterprises to those clouds through our Equinix Cloud Exchange Fabric. It’s a simple one-port virtual connection, using software-defined networking (SDN), up to the public clouds.

That provides low-latency and high-performance connections -- up to 10 Gigabit network links. So you can now run a hybrid application and it’s performing as if it’s sitting in your corporate data center not far away.


The idea is to be hybrid and to be more dispersed. That dispersion takes place through the breadth of our reach at Equinix with more than 200 data centers in 45 metro areas all over the world -- and so, interconnected all over.

Plus, there are more than 50 Microsoft Azure regions. We’re working closely with Microsoft so that we can get the cloud out to the customers fairly easily using the network service providers in our facilities. There are very few places on Earth where a customer can’t get from where they are to where we are, to a cloud – and with a really high-quality network link.

Gardner: Xavier, why is what we just heard a good fit for Cloud28+? How do you fit in to make hybrid clouds possible across different many regions?

Poisson
Poisson: HPE has invested a lot in intellectual property in building our own HPE and Microsoft Azure Stack solution. It’s designed to provide the experience of a private cloud while using Microsoft as your technology’s tool.

Our customers want two things. The first is to be able to execute clouds on-premises, but also to connect to wider public clouds. This is enabled by what we are doing with a partner like Equinix. We can jump from on-premises to off-premises for an end-user customer.

The second is, when a customer decides to go to a new architecture around hybrid cloud, they may need to get reach and this reach is difficult now.

So, how we can support partners to find the right place, the right partners at the right moment in the right geographies with the right service level agreements (SLAs) for them to meet their business needs?

The fact that we have Equinix inside of Cloud28+ as a very solid partner is helping our customers and partners to find the right route. If I am an enterprise customer in Australia and I want to reach into Europe, or reach into Japan, I can, through Cloud28+, find the right service providers to operate the service for me. But I will also be hosted by a very compelling co-location company like Equinix, with the right SLAs. And this is the benefit for every single customer.

This has a lot of benefits for our MSPs. Why? Because our MSPs are evolving their technologies, evolving their go-to-market strategies, and they need to adapt. They need to jump from one country to another country, and they need to have a sustainable network to make it all happen. That’s what Equinix is providing.
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We not only help the end-user customers, but we also help our MSPs to build out their capabilities. Why? We know that with interconnectedness, as was just mentioned, that they can deliver direct cloud connectivity to all of their end users.

Together we can provide choice for partners and end-user customers in one place, which is Cloud28+. It’s really amazing. 

Gardner: What are some of the compelling new use cases, David? What are you seeing that demonstrates where this works best? Who should be thinking about this now as a solution?

Data distribution solutions


Anderson: The solution -- especially combined with Microsoft Azure Stack -- is suited to those regions that have had data sovereignty and regulatory compliance issues. In other words, they can’t actually put their data into the public cloud, but they want to be able to use the power, elasticity, and the compute potential of the public cloud for big data analytics, or whatever else they want to do with that data. And so they need to have that data adjacent to the cloud.

Same for an Azure Stack solution. Oftentimes it will be in situations where they want to do DevOps. The developers might want to develop in the cloud, but they are going to bring it down to a private Azure Stack installation because they want to manage the hardware themselves. Or they actually might want to run that cloud in a place where public Azure may not yet have an availability zone. That could be sub-Saharan Africa, or wherever it might be -- even on a cruise ship in the middle of the ocean.

There's a lot of legacy hardware out there. The need is for applications to run on a cloud, but the hardware can't be virtualized. These workloads could be moved to Equinix and then connect to a cloud.
Another use case that we are driving hard right now with Microsoft, HPE, and Cloud28+ is on the idea of an enterprise cage, where there is a lot of legacy hardware out there. The need is for applications to run to some degree on a cloud, but the hardware can’t be virtualized. But these workloads could be moved to an Equinix data center and connected to the cloud. They can then use the cloud for the compute part, and all of a sudden they are still getting value out of that legacy hardware, in a cloud environment, in a distributed environment.

Other areas where this is of value include a [data migration] appliance that is shipped out to a customer. We’ve worked a lot with Microsoft on this. The customer will put up to 100 TB of data on the appliance. It then gets shipped to one of our data centers where it’s hooked up through high-speed connection to Azure and the data can be ingested into Azure.

Now, that’s a onetime thing, but it gives us and our service providers on Cloud28+ the opportunity to talk to customers about what they are going to do in the cloud and what sort of help might you need.

Scenarios like that provide an opportunity to learn more about what enterprises are actually trying to do in the cloud. It allows us then to match up the service providers in our ecosystem, which is what we use Cloud28+ for with enterprise customers who need help.

Gardner: Xavier, it seems like this solution democratizes the use of hybrid clouds. Smaller organizations, smaller MSPs with a niche, with geographic focus, or in a vertical industry. How does this go down market to allow more types of organizations to take advantage of the greatest power of hybrid cloud?

Hybrid cloud power packaged


Poisson: We have packaged the solutions together with Equinix by default. That means that MSPs can just cherry pick to provide new cloud offerings very quickly.

Also, as I often say, the IT value chain has not changed that much. It means that if you are a small enterprise, let’s say in the United States, and you want to shape your new generation of IT, do you go directly to a big cloud provider? No, because you still believe in your systems integrator (SI), and in your value-added reseller (VAR).

Interestingly, when we package this with Equinix and Microsoft, having this enterprise cage, the VARs can take the bull by the horns. Because, when the customer comes to them and says, “Okay, what should I do, where should put my data, how can I do the public cloud but also a private cloud?” The VAR can guide them because they have an answer immediately -- even for small- to medium-sized (SMB) businesses.
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Our purpose at Cloud28+ is to explain all of this through thought leadership articles that we publish -- explaining the trends in the market, explaining that the solutions are there. You know, not a lot of people know about Equinix. There are still people who don’t know that they can have global reach.

If you are a start-up, for example, you have a new business, and you need to find MSPs everywhere on the globe. How you do that? If you go to Cloud28+ you can see that there are networks of service providers or learn what we have done with Equinix. That can empower you in just a few clicks.

We give the access to partners who have been publishing more than 900 articles in less than six months on various topics such as security, big data, interconnection, globalization, artificial intelligence (AI), and even the EU’s General Data Protection Regulation (GDPR). They learn and they find offerings because the articles are connected directly to those offering services, and they can get in touch.

We are easing the process -- from the thought leadership, to the offerings with explanations. What we are seeing is that the VARs and the SIs are still playing an enormous role. 

So, it’s not only Microsoft, with HPE, and with the data centers of Equinix, but we put the VARs into the middle of the conversation. Why? Because they are near the SMBs. We want to make everything as simple as you just put in your credit card and you go. That’s fair enough for some kinds of workloads.

But in most cases, enterprises still go to their SIs and their VARs because they are all part of the ecosystem. And then, when they have the discussion with their customers, they can have the solution very, very quickly.

Gardner: Seems to me that for VARs and SIs, the cloud was very disruptive. This gives them a new lease on life. A middle ground to take advantage of cloud, but also preserve the value that they had already been giving.

Take the middle path


Poisson: Absolutely. Integration services are key, application migrations are key, and security topics are very, very important. You also have new areas such as AI and blockchain technologies.

For example, in Asia-Pacific and Europe, Middle East and Asia (EMEA), we have more-and-more tier-two service providers that are not only delivering their best services but are now investing in practices around AI or blockchain -- or combine them with security -- to upgrade their value propositions in the market.

For VARs and for Sis, it is all benefit because they know that solutions exist, and they can accompany their customers to the transition. For them, this is all also a new flow of revenue.

Gardner: As we get the word out that these distributed hybrid cloud solutions are possible and available, we should help people understand which applications are the right fit. What are the applications that work well in this solution?

The hybrid solution gives SIs, service providers, and enterprises more flexibility than if they try and move an application completely into the cloud.
Anderson: The interesting thing is that applications don’t have to be architected in a specific way, based on the way we do hybrid solutions. Obviously, the apps have to be modern.

I go back to my engineering days 25 years ago, when we were separating data and compute and things like that. If they want to write a front-end and everything in platform-as-a-service (PaaS) on Azure and then connect that down to legacy data, it will work. It just works.

The hybrid situation gives SIs, service providers, and enterprises more flexibility than if they try and move an application, whatever it is, completely into the cloud, because that actually takes a lot more work.

Some service providers believe that hybrid is a transitory stage, that enterprises would go to hybrid just to buy them time till they go fully public cloud. I don’t believe Microsoft thinks that way, and we certainly don’t think that way. I think there is a permanent place for hybrid cloud.

In fact, one of the interesting things when I first got to Equinix was that we had our own sellers saying, “I don’t want to talk to the cloud guys. I don’t want them in our data centers because they are just going to take my customers and move them to the cloud.”

The truth of the matter is that demand for our data centers has increased right along with the increase in public cloud consumption. So it’s a complementary thing, not a substitution thing. They need our data centers. What they are trying to do now is to close their own enterprise data centers.

And they are getting into Equinix and finding out that the connectivity possibilities and -- especially in the Global 2000 enterprises -- nobody wants cloud vendor lock-in. They are all multicloud. Our Equinix Cloud Exchange Fabric solution is a great way to get in at one point and be able to connect to multiple cloud providers from right there.

It gives them more flexibility in how they design their apps, and also more flexibility in where they run their apps.

Gardner: Do you have any examples of organizations that have already done this? What demonstrates the payoffs? When you do this well, what do you get for it?

Cloudify your networks



Anderson: We have worked with customers in these situations where they have come in initially for a connection to Microsoft, let’s say. Then we brought them together with a service provider and worked with them on network transformations to the point where they have taken their old networks – a lot of Multiprotocol Label Switching (MPLS) and everything else that were really very costly and didn’t perform that well -- and ended up being able to rework their networks. We like to say they cloudify their networks, because a lot of enterprise networks aren’t really ready for the heavy load of getting out to the cloud.

And we ended up increasing their performance by up to 10, 15, 20 times -- and at the same time cut their networking costs in half. Then they can turn around and reinvest that in applications. They can also then begin to spin up cloud apps, and just provision them, and not have to worry about managing the infrastructure.

They want the same thing in a hybrid world, which is where those service providers that we find on Cloud28+ and that we amplify, come in. They can build those managed services, whether it’s a managed Azure Stack offering or anything else. That enables the enterprise IT shops to essentially do the same thing with hybrid that they are doing with public cloud – they can buy it on a consumption model. They are not managing the hardware because they are offloading that to someone else.
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Because they are buying all of their stuff in the same model -- whether it’s considered on-premises or a third-party facility like ours, or a totally public cloud. It’s the same purchasing model, which is making their procurement departments happy, too.

Gardner: Xavier, we have talked about SIs, VARs, and MSPs. It seems to me that for who we used to call independent software vendors (ISVs), the former packaged software providers, that this hybrid cloud model also offers a new lease on life. Does this work for the applications providers, too?

Extend your reach


Poisson: Yes, absolutely. And we have many, many examples in the past 12 months of ISVs, software companies, coming to Cloud28+ because we give them the reach.

Lequa AB, a Swedish company, for example, has been doing identity management, which is a very hot topic in digital transformation. In the digital transformation you have your role when you speak to me, but in your other associations you have another role. The digital transformation of these roles needs to be handled, and Lequa has done that.

And by partnering with Cloud28+, they have been able to extend their reach in ways they wouldn’t ever have otherwise. Only in the past six months, they have been in touch with more than 30 service providers across the world. They have already closed deals.
If I am only providing baseline managed information services, how can I differentiate from the hyperscale cloud providers? MSPs now care more about the applications to differentiate themselves in the market.

On one side of the equation for ISVs, there is a very big benefit -- to be able to reach ready-to-be-used service providers, powered by Equinix in many cases. For the service providers, there is also an enormous benefit.

If I am only providing baseline managed information services, how can I differentiate from the hyperscale cloud providers? How can I differentiate from even my own competitors? What we have seen is that the MSPs are now caring more about the application makers, the former ISVs, in order for them to differentiate in the market.

So, yes, this is a big trend and we welcome into Cloud28+ more and more ISVs every week, yes.

Gardner: David, another concern that organizations have is as they are distributing globally, as there are more moving parts in a hybrid environment, things become more complex. Is there something that HPE is doing with new products like OneSphere that will help? How do we allow people to gain confidence that they can manage even something that’s a globally distributed hybrid set of applications?

Confident connections in global clouds


Anderson: There are a number of ways we are partnering with HPE, Microsoft, and others to do that. But one of the keys is the Equinix Cloud Exchange Fabric, where now they only have to manage one wire or fiber connection in a switching fabric. That allows them to spin up connections to virtually all of the cloud providers, and span those connections across multiple locations. And so that makes it easier to manage.

The APIs that drive the Equinix Cloud Exchange Fabric can be consumed and viewed with tools such as HPE OneSphere to be able to manage everything across the solution. The MSPs are also having to take on more and be the ones that provide management.

As the huge, multinational enterprises disperse their hybrid clouds, they will tend to view those in silos. But they will need one place to go, one view to look at, to know what’s in each set of data centers.

At Equinix, our three pillars are the ideas of being able to reach everywhere, interconnect everything, and integrate everything. That idea says we need to be the place to put that on top of HPE with the service providers because then that gives you that one place that reaches those multiple clouds, that one set of solid, known, trusted advisors in HPE and the service providers that are really certified through Cloud28+. So now we have built this trusted community to really serve the enterprises in a new world.

Gardner: Before we close out, let’s take a look into the crystal ball. Xavier, what should we expect next? Is this going to extend to the edge with the Internet of Things (IoT), more machine learning (ML)-as-a-service built into the data cloud? What comes next?

The future is at the Edge


Poisson: Today we are 810 partners in Cloud28+. We cover more than 560 data centers in more than 34 countries. We have been publishing nearly 30,000 cloud services in only two years. You see how fast it has been growing.

What do we expect in the future? You named it: Edge is a very hot topic for us and for Equinix. We plan to develop new offering in this area, even new data center technology. It will be necessary to have new findings around what a data center of tomorrow is, how it will consume energy, and what we can do with it together.

We are already engaged in conversations between Equinix, ourselves, and another company within the Cloud28+ community to discuss what the future data center could be.

A huge benefit of having this community is that by default we innovate. We have new ideas because it's coming through all of the partners. Yes, edge computing is definitely a very hot spot.

For the platform itself, I believe that even though we do not monetize in the data center, which is one of the definitions of Cloud28+, the revenues at the edge are for the partners, and this is also by design.

Nonetheless, we are thinking of new things such as a smart contracting around IoT and other topics, too. You need to have a combination of offerings to make a project. You need to have confidentiality between players. At the same time, you need to deliver one solution. So next it may be solutions on best ways for contracting. And we believe that blockchain can add a lot of value in that, too.

Cloud28+ is a community and a digital business platform. We are thinking of such things as smart contracting for IoT and using blockchain in many solutions.
Cloud28+ is a community and a digital business platform. By the way, we are very happy to have been recognized as such by Gartner in several research notes since September 2017. We want to start to include these new functions around smart contracting and blockchain.

The other part of the equation is how we help our members to generate more business. Today we have a module that is integrated into the platform to amplify partner articles and their offerings through social media. We also have a lead-generation engine, which is working quite well.

We want to launch an electronic lead-generation capability through our thought leadership articles. We believe that if we can give the feedback to the people filling in these forms, with how they position versus all of their peers, on how they position versus the industry analysts, they will be very eager to engage with us.

And the last piece is we need to examine more around using ML across all of these services and interactions between people. We need to deep dive on this to find what value we can bring from out of all this traffic, because we have such traffic now inside Cloud28+ that trends are becoming clear.
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For instance, I can say to any partner that if they publish an article on what is happening in the public sector today, it will have a yield that is x-times the one that has been published at an earlier date. All this intelligence, we have it. So what we are packaging now is how to give intelligence back to our members so they can capture trends very quickly and publish more of what is most interesting to the people.

But in a nutshell, these are the different things that we see.

Gardner: And I know that evangelism and education are a big part of what you do at Cloud28+. What are some great places that people can go to learn more?

Poisson: Absolutely. You can read not only what the partners publish, but examine how they think, which gives you the direction on how they operate. So this is building trust.

For me, at the end of the day, for an end-user customer, they need to have that trust to know what they will get out of their investments.

Gardner: I’m afraid we will have to leave it there. We have been exploring how the triumvirate of a global data center hosting company, a hybrid cloud platform provider, and a global cloud community are solving some of the most vexing problems for bringing high-performance clouds to more regions around the globe. And we have learned how new breeds of hybrid cloud solutions are allowing more users to attain world-class cloud services nearly anywhere.

So please join me in thanking our guests, David Anderson, Global Alliance Director at Equinix for its Microsoft Alliance. Thank you, David.

Anderson: Thank you, Dana. It’s been a pleasure.

Gardner: We have also been here with Xavier Poisson, Vice President of Worldwide Service Providers Business and Cloud28+ at HPE. Thank you, sir.

Poisson: Thank you, Dana. A pleasure.

Gardner: And a big thank you as well to our audience for joining us for this BriefingsDirect Voice of the Customer digital transformation success story discussion.

I'm Dana Gardner, Principal Analyst at Interarbor Solutions, your host for this ongoing series of Hewlett Packard Enterprise sponsored interviews. Thanks again for listening. Please pass this along to your own IT community, and do come back next time.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: Hewlett Packard Enterprise

Transcript of a discussion on how Equinix, Microsoft Azure Stack, and Cloud28+ together are advancing and extending hybrid cloud options across the globe. Copyright Interarbor Solutions, LLC, 2005-2018. All rights reserved.

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