2. IS CLOUD COMPUTING A TECHNOLOGY, AN OPERATIONS MODEL
OR A BUSINESS STRATEGY?
SPEAKER: Joe Weinman
SVP
Cloud Services and Strategy
Telx
Tuesday, October 1, 13
3. Is Cloud Computing a Technology,
an Operations Model, or a Business
Strategy?
Joe Weinman
SVP, Cloud Services and Strategy, Telx
jweinman@telx.com
@joeweinman
Tuesday, October 1, 13
4. NIST Definition of Cloud
oud computing is a model for enabling convenient, on-demand network access to a share
sources (e.g., networks, servers, storage, applications, and services) that can be rapidly p
inimal management effort or service provider interaction.
On-demand self-service: A consumer can unilaterally provision computing capabilities, su
orage, as needed automatically without requiring human interaction with each service’s p
Broad network access: Capabilities are available over the network and accessed through s
se by heterogeneous thin or thick client platforms (e.g., mobile phones, laptops, and PDAs
Resource pooling: The provider’s computing resources are pooled to serve multiple consu
th different physical and virtual resources dynamically assigned and reassigned accordin
nse of location independence in that the customer generally has no control or knowledge
ovided resources but may be able to specify location at a higher level of abstraction (e.g.
amples of resources include storage, processing, memory, network bandwidth, and virtua
Rapid elasticity: Capabilities can be rapidly and elastically provisioned, in some cases aut
pidly released to quickly scale in. To the consumer, the capabilities available for provisio
nd can be purchased in any quantity at any time.
Measured Service: Cloud systems automatically control and optimize resource use by leve
vel of abstraction appropriate to the type of service (e.g., storage, processing, bandwidth,
sage can be monitored, controlled, and reported providing transparency for both the prov
rvice.Tuesday, October 1, 13
24. Creative Destruction
Destruction Creation
Edited Print Encyclopedia Crowdsourced Wikipedia
Telco SMS Over the Top WhatsApp
Circuit-Switched Voice Skype, Google Voice
Matchmakers Match.com
Film Photography Digital / Instagram
Books eBooks
CDs iTunes / Pandora / Spotify
Waving Down Cabs Uber
Cash Registers Square
Based in Part on Mary Meeker/KPCB, “Internet Trends,” D10 Conference, May 30, 2012
Tuesday, October 1, 13
25. Range of IT Value
Source: Joe Weinman, Cloudonomics
Tactical
Tuesday, October 1, 13
26. Range of IT ValueIncreasingValue
Source: Joe Weinman, Cloudonomics
Operational
Tactical
Tuesday, October 1, 13
27. Range of IT ValueIncreasingValue
Source: Joe Weinman, Cloudonomics
Strategic
Operational
Tactical
Tuesday, October 1, 13
28. Range of IT ValueIncreasingValue
Source: Joe Weinman, Cloudonomics
Existential
Strategic
Operational
Tactical
Tuesday, October 1, 13
29. Range of IT ValueIncreasingValue
Source: Joe Weinman, Cloudonomics
Existential
Strategic
Operational
Tactical
•Base Functionality
Tuesday, October 1, 13
30. Range of IT ValueIncreasingValue
Source: Joe Weinman, Cloudonomics
Existential
Strategic
Operational
Tactical
•Base Functionality
•Total Cost
Tuesday, October 1, 13
31. Range of IT ValueIncreasingValue
Source: Joe Weinman, Cloudonomics
Existential
Strategic
Operational
Tactical
•Base Functionality
•Business Agility
•Total Cost
Tuesday, October 1, 13
32. Range of IT ValueIncreasingValue
Source: Joe Weinman, Cloudonomics
•Firm Survival
Existential
Strategic
Operational
Tactical
•Base Functionality
•Top Line Revenue/Growth
•Market Share
•Customer Churn
•Core vs. Context
•User Experience
•Business Agility
•Total Cost
Tuesday, October 1, 13
33. IT and the Cloud Do Matter
Tuesday, October 1, 13
34. IT and the Cloud Do Matter
Increasingly Digital World
Tuesday, October 1, 13
35. IT and the Cloud Do Matter
Increasingly Digital World
IT/Cloud Imperative
Tuesday, October 1, 13
36. IT and the Cloud Do Matter
Increasingly Digital World
IT/Cloud Imperative
Strategic & Existential
Tuesday, October 1, 13
37. IT and the Cloud Do Matter
Increasingly Digital World
IT/Cloud Imperative
Strategic & Existential
Focused Investment
Tuesday, October 1, 13
38. Decision Making
Source: Brynjolfsson, Hitt, and Kim, “Strength in Numbers:
How Does Data-Driven Decisonmaking Affect Firm Performance?,” 2011
Tuesday, October 1, 13
39. Decision Making
“Data-driven decision
making” correlates
with higher
productivity, market
value, ROE, and asset
utilization.
Source: Brynjolfsson, Hitt, and Kim, “Strength in Numbers:
How Does Data-Driven Decisonmaking Affect Firm Performance?,” 2011
Tuesday, October 1, 13
40. Firm Profitability
Fixed Effect Models*
Base Model Incl Sales, OPEX
IT 1.912 1.837
Sales 0.054
OPEX 0.137
Advertising 0.155 0.142
R&D 1.001 0.993
R2 (overall) 0.49 0.51
Observations 276276
Number of Firms 8686
Source: Sunil Mithas, Ali Tafti, Indranil Bardhan, Jie Mein Goh, “Information Technology and Firm Profitablilty,” MIS
Quarterly, March 2012. Used by Permission (*includes intercept, year, industry average Tobin’s q. Herfindahl Index, and
industry capital intensity.”
Tuesday, October 1, 13
41. Value Disciplines
Source: Michael Treacy & Fred Wiersema, “The Discipline of Market Leaders;”Joe Weinman, Cloudonomics
Tuesday, October 1, 13
43. Value Disciplines
Operational Excellence Product Leadership
Source: Michael Treacy & Fred Wiersema, “The Discipline of Market Leaders;”Joe Weinman, Cloudonomics
Tuesday, October 1, 13
44. Value Disciplines
Operational Excellence Product Leadership
Customer Intimacy
Source: Michael Treacy & Fred Wiersema, “The Discipline of Market Leaders;”Joe Weinman, Cloudonomics
Tuesday, October 1, 13
45. Value Disciplines
Operational Excellence Product Leadership
Customer Intimacy Accelerated Innovation
Source: Michael Treacy & Fred Wiersema, “The Discipline of Market Leaders;”Joe Weinman, Cloudonomics
Tuesday, October 1, 13
58. Organizational Designs
Source: After Nadler, Gerstein, Shaw, Organizational Architecture
Hierarchical
Bureaucracy
Simple
EnvironmentalComplexity
Tuesday, October 1, 13
59. Organizational Designs
Source: After Nadler, Gerstein, Shaw, Organizational Architecture
Hierarchical
Bureaucracy
Simple
Entrepreneuri
al
EnvironmentalComplexity
Pace of Change
Tuesday, October 1, 13
60. Organizational Designs
Source: After Nadler, Gerstein, Shaw, Organizational Architecture
Hierarchical
Bureaucracy
Network
Simple
Entrepreneuri
al
EnvironmentalComplexity
Pace of Change
Tuesday, October 1, 13