1. Windows Azure
Customer Solution Case Study
Company Efficiently Delivers
Advanced Forecasts with Scalable
Software-plus-Services
Overview “Previously, we could not produce such
Country or Region: France
Industry: Professional services an advanced forecasting model with
accuracy in an hour—it is only with
Customer Profile
Lokad develops statistical Windows Azure that this is possible.”
forecasting models that enable
Rinat Abdullin, Chief Technology Officer, Lokad
its customers to manage
inventory levels, call volumes, Lokad is a software development company that
and sales demands. The
company has six employees
delivers sales, demand, and call volume forecasts
and serves 300 customers of all for more than 300 customers—from one-person
sizes.
eCommerce companies to multinational retailers.
Business Situation To improve its forecasting capabilities, the
Lokad wanted to deliver a more
accurate forecasting model but
company developed advanced forecasting tools
was constrained by the and models. However, the more powerful
computing requirements and
costs associated with such a
forecasting models required significantly more
powerful model. Lokad also computing resources than the company had
wanted to expand into new
markets.
available. Lokad decided to implement its
software-plus-services forecasting application on
Solution
Lokad chose the Windows
the Windows Azure™ platform—a quick, efficient
Azure™ platform to deliver its process. As a result, Lokad reduced IT
software-plus-services
application to customers and
maintenance costs compared to traditional
extend its solution offerings. approaches, delivered more powerful and
Benefits
accurate forecasts to its customers, and
• Fast development time improved its ability to expand into new markets.
• Reduced IT maintenance
costs
• Improved service offerings
for customers
• Greater competitive
advantage

3. “We anticipate the Situation forecasts within one hour. The
Based in Paris, France, Lokad company delivers its forecasting
ability to deliver 100 provides sales, demand, and call technology through a simple
volume forecasts for customers object access protocol (SOAP)-
times the forecasts of all sizes. Lokad’s customers based Web services application
—up to 100 million rely on accurate forecasts to programming interface (API).
optimize their business Customers upload their data to
forecasts per hour operations. Often used by Lokad and then download their
retailers to help meet supply and forecasts programmatically.
with Windows demand needs, forecasts are Because the Lokad solution is
Azure.” also used across several other based on standard technologies,
industries. For instance, banks it can be integrated into virtually
Joannès Vermorel, Chief need cash statistics to supply any third-party application, as
Executive Officer, Lokad automated teller machines and long as an Internet connection is
branches with banknotes; and available. In addition, Lokad
businesses with large call centers provides specialized client
need to forecast call volumes and applications: a safety stock
staffing levels to meet customer calculator to optimize inventory
service needs. levels, a call center calculator to
optimize staffing levels, and a
Statistical forecasting is a sales forecast add-in for
complex process, especially if Microsoft Office Excel®
there are multiple products and spreadsheet software. Lokad
what-if parameters. With also continues to develop other
traditional statistical forecasting applications with Microsoft
methods, businesses must hire technologies, each solving
specialists to prepare data using specific forecasting problems for
a time-consuming, complicated its customers.
process, taking into consideration
special situations, such as Though Lokad provides a unique
exception points and seasonality. statistical forecasting solution
The mission for the six-person that makes the forecasting
team at Lokad is to facilitate this process simple and quick for its
process for its customers and customers, the company wanted
make forecasting a simple task to deliver even higher-quality,
that does not require any more accurate forecasts. “The
statistical expertise. forecasts we deliver to
customers directly impact their
With the Lokad solution, which is bottom line,” explains Joannès
built on the Microsoft® .NET Vermorel, Chief Executive Officer
Framework 3.5, customers send at Lokad. “For that reason, we
their relevant data to Lokad take any opportunity we can to
through a Web-enabled service, improve our forecasts.”
and Lokad returns accurate

4. The company developed a set of retailer’s warehouse, but also to
more powerful forecasting provide forecasts at the point-of-
models; however, to continue sale. Instead of providing monthly
delivering forecasts within one forecasts for products in a
hour, those models required a warehouse, customers could
significant amount of processing take advantage of daily forecasts
power. To handle the increased to gain insight into fluctuating
CPU requirements, Lokad inventory levels at retail locations.
considered adding more physical However, point-of-sale forecasts
servers to its rented data center require significantly more
in the United States. That option, processing power, which Lokad
however, is both time consuming did not have available.
and expensive for a small
company. Lokad would need to
hire full-time systems Solution
administrators to manage the In an effort to address its needs
additional servers, and it would for a scalable, cost-effective
not be able to scale up quickly to solution that would yield
meet processing needs. Also, significantly more processing
adding more servers to handle power, Lokad decided to
peak processing loads meant implement the Windows Azure™
that the company would pay for platform, a solution that provides
unused server space during non- application hosting by Microsoft
peak times. with high-availability and virtually
unlimited processing and storage
“Our new statistical models are capacity. The Windows Azure
extremely powerful and will allow platform includes a cloud
us to deliver intricate and highly services operating system and a
accurate forecasts, but it’s also set of developer services.
greedy in terms of CPU,” says
Vermorel. “It would be so Prior to the public announcement
expensive for us to implement in of Windows Azure, Lokad knew
terms of computing power and that it wanted to implement a
personnel resources that we “cloud computing” solution—the
didn’t even bother to put those hosting and management of Web
models into production.” applications and services on the
Internet through data centers.
In addition to delivering powerful, The company evaluated both
accurate forecasts, Lokad Rackspace and Amazon Elastic
wanted to expand into new Compute Cloud (EC2), but neither
markets. For instance, the option was an optimal solution to
company recognized an meet its needs. For instance,
opportunity to not just provide Lokad has built its IT
forecasts for inventory levels in a infrastructure on Microsoft

5. products and technologies and and returns the results through
develops its solution using the C# another queue.
programming language and the
Microsoft Visual Studio® 2008 For its relational database needs,
Professional Edition development Lokad uses Microsoft SQL
system. With Rackspace and Server® 2008 data management
Amazon EC2, developers at software. In the future, it will
Lokad would have to learn new upgrade to Microsoft SQL Azure
technologies; however, with and use cluster agents to meet
Windows Azure, developers can the infinitely scalable needs of the
use their existing skills and company. Lokad will continue to
develop new solutions with tools use Language Integrated Query
they are already familiar with. In (LINQ), which it already uses in its
addition, the Windows Azure current environment, to retrieve
software development kit table data with expressive
provides a utility that simulates queries.
the Windows Azure development
fabric on a local machine, Forecast Accuracy with a Cost-Effective,
enabling developers to run and Efficient Strategy
test services locally before With the nearly limitless
deploying it. processing power offered by
Windows Azure, Lokad can
Software-plus-Services for Storage Needs implement more powerful
In addition to the Windows Azure forecasting models. Its new
operation system, Lokad is taking statistical models require 10 times
advantage of Windows Azure the processing power of its
Storage services, including Blob existing models. And with the
Storage and Queue services. limited capacity of its rented
With Blob Storage, Lokad can server space, the company would
store the limitless unstructured, not be able to process forecasts
binary data that customers with its new model in the one-
upload for analysis. Queue hour turnaround time that it
services enable Web Roles and promises customers.
Worker Roles in Windows Azure “Previously, we could not
to communicate with each other. produce such an advanced
Lokad customers upload their forecasting model with accuracy
data via the Web-based in an hour—it is only with Windows
application implemented by a Azure that this is possible,” says
Windows Azure Web Role, which Rinat Abdullin, Chief Technology
then writes a message to a Officer at Lokad.
queue. A Windows Azure Worker
Role reads the message, The company now expects to
completes the forecasting task, deliver significantly more
forecasts each hour with

6. Windows Azure. “We anticipate
“Now, we can rely the ability to deliver 100 times the Benefits
on Microsoft to forecasts—up to 100 million By using the Windows Azure
forecasts per hour with Windows platform, Lokad efficiently
absorb Azure,” says Vermorel. What’s implemented its software-plus-
more, Lokad can quickly and services forecasting application.
[administrative and cost-effectively scale up or scale Lokad quickly developed the
maintenance] work down to meet customer needs. solution and, by relying on
Instead of paying for racks of Microsoft hosting services,
for us, making the underutilized servers, Lokad can maintaining its technology
pay for its computer processing infrastructure is not a worry. In
cost of Windows and storage needs on a pay-per- addition, by focusing on its
Azure considerably consumption basis with Windows business logic, Lokad can invest
Azure. more time developing powerful
lower than if we solutions and expand its services
to new industries, giving the
had to do that Opportunities to Develop New Solutions
Because Lokad has nearly company a competitive
same work.” limitless storage and processing advantage in its unique market.
resources with Windows Azure,
the company can experiment with Fast Development Time
new solutions for niche markets Because Lokad already uses
and expand its marketing the .NET Framework and
opportunities. In addition to developer tools, such as Visual
delivering point-of-sale forecasts, Studio 2008, developing on the
Lokad is looking to develop a Windows Azure platform requires
solution that measures energy minimal training time. Developers
consumption. For instance, in can use their skills to migrate the
Europe, energy companies are existing Lokad solution to
installing smart grids in Windows Azure and make better
consumers’ homes to measure use of their time spent developing
electricity use. By using new applications, especially
advanced forecasting models compared to other offerings.
based on that data, energy
companies can tune electricity In addition, when a new
production and reduce the developer joins the team at
amount of energy that is lost due Lokad, he or she can get to work
to over-production. To develop a quickly without learning a new
forecasting solution to process programming language or tool
that amount of data would result set. “We hired a new developer
in exorbitant costs. Without this week and he has already
Windows Azure, Lokad would not started working on the Windows
be able to implement the solution, Azure project—he was
much less develop it. immediately productive,”
explains Abdullin.

7. “Windows Azure models that give businesses the
Reduced IT Maintenance Costs insight they need to modify
gives us the ability With only six staff members at resources, inventory, and sales
Lokad, all of whom are techniques.
to experiment and developers or mathematicians,
find new, innovative the company has lean operations Lokad has the development and
and relies on an easily managed mathematical expertise to create
ways for us to IT infrastructure. With Windows more advanced and precise
Azure, Lokad does not need to forecasting models; however, the
penetrate new redirect valuable developer company did not have the
markets with our resources or hire additional staff computing resources to deliver
to deploy and manage the server that model to its customers.
statistical infrastructure that supports its Explains Abdullin, “With
forecasting solution. Instead, advanced forecasting models
forecasting because the solution is hosted by there was no hope to deliver
models. This isn’t Microsoft, Lokad can rely on forecasts in less than one hour,
enterprise-class service for but Windows Azure is changing
possible—from a maintenance tasks, such as that.”
troubleshooting issues or
time, cost, or producing backup files. “With the
scalability classic approach to client-side
computing, as opposed to the
cloud computing that Windows
Azure offers, you need a lot of
personnel and money just to
administrate and maintain your
infrastructure,” says Vermorel.
“Now, we can rely on Microsoft
to absorb that work for us,
making the cost of Windows
Azure considerably lower than if
we had to do that same work.”
Improved Service Offerings for Customers
In times of global economic
downturn, companies look for
new ways to optimize inventory
and staffing levels, helping them
to maintain tighter control over
expenditures. By using the
computing power of Windows
Azure, Lokad can offer improved
service offerings and implement
more advanced forecasting

8. Greater Competitive Advantage
By using the Windows Azure
platform, Lokad developers are
focused on building new service
offerings for customers. With
robust forecasting services in
place, the company can inject its
business logic and statistical
models into other niche markets—
while still maintaining scalability.
For instance, Lokad could extend
its services beyond traditional
forecasting markets and into new
markets, such as construction
project management. Forecasting
and model optimization is critical
for delivering complex and long-
running projects to success;
however, the construction
industry does not currently have
the technology, research
methods, or software to optimize
relevant forecasts. With Windows
Azure, Lokad can take its
established business logic and
evolve a construction project
schedule in real-time and solve
issues with project constraints.
“Windows Azure gives us the
ability to experiment and find
new, innovative ways for us to
penetrate new markets with our
statistical forecasting models,”
explains Abdullin. “This isn’t
possible—from a time, cost, or
scalability perspective—with any
other solution.”

9. For More Information Windows Azure Platform service built on Microsoft SQL
For more information about The Windows Azure platform Server 2008 technologies.
Microsoft products and provides an excellent foundation
services, call the Microsoft for expanding online product and To learn more about the Windows
Sales Information Center at service offerings. The main Azure platform, visit:
(800) 426-9400. In Canada, call components include: www.windowsazure.com
the Microsoft Canada • Windows Azure. Windows Azure
Information Centre at (877) is the development, service
568-2495. Customers in the hosting, and service
United States and Canada who management environment for
are deaf or hard-of-hearing can the Windows Azure platform.
reach Microsoft text telephone Windows Azure provides
(TTY/TDD) services at (800) developers with on-demand
892-5234. Outside the 50 compute and storage to host,
United States and Canada, scale, and manage Web
please contact your local applications on the Internet
Microsoft subsidiary. To access through Microsoft data
information using the World centers. In addition, Windows
Wide Web, go to: Azure serves developers’
www.microsoft.com connectivity needs through
the following services.
For more information about 〉 The Service Bus connects
Lokad products and services,
services and applications
call (716) 989-6531 or visit the
across network
Web site at: www.lokad.com
boundaries to help
developers build
Additional Resources:
distributed applications.
Download: Windows Azure
〉 The Access Control Service
Platform Training Kit
provides federated,
claims-based access
control for REST Web
services.
• Microsoft SQL Azure. Microsoft
SQL Azure offers the first
cloud-based relational and
self-managed database
Software and Services • Microsoft Server Product
• Windows Azure Platform Portfolio
• Windows Azure • Microsoft SQL Server 2008
• Microsoft SQL Azure • Technologies
• Blob Storage • Microsoft .NET Framework
• Queue 3.5
• Microsoft Visual Studio • Solutions
• Microsoft Visual Studio 2008 • Software-plus-services
Professional Edition
This case study is for informational
purposes only. MICROSOFT MAKES NO
WARRANTIES, EXPRESS OR IMPLIED, IN
THIS SUMMARY.
Document published November 2009