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How to Utilize Cloud in <br />your Corporate IT Strategy<br />Paul Selway<br />James Smale<br />Jason Baker<br />1<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Paul Selway<br />Paul brings to Redpath Consulting Group over 25 years of experience in the consulting industry.<br />His extensive background and career progression through the roles IT Management Consultant, Technology Director, and Principal Partner began from a solid foundation as a Software Engineer.<br />His experience was gained from numerous management consulting engagements for clients in both Europe and North America; focused on the healthcare, financial, banking, brokerage, and capital markets industry.<br />Paul has an International MBA from Henley Business School, B.S.C Honors Computer Science Degree, Electronics Degree, and is a Chartered Engineer.<br />Paul Selway<br />President<br />2<br />Redpath Consulting Group confidential and proprietary 2010<br />

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James Smale<br />James brings to Redpath Consulting Group over 20 years of experience in business and the IT consulting industry.<br />His extensive background and career progression through the roles Sr. Technical Analyst, Technology Director, Business Entrepreneur and Principal Partner began from a solid foundation as an IT Infrastructure Engineer.<br />His experience was gained from numerous management roles and consulting engagements for clients in both Europe, Asia, Latin America and North America; focused on software manufacturing, airline operations, advertising, agriculture, manufacturing, and health care industries.<br />James also has extensive experience in operational support leadership, process improvement, strategic organization planning and enterprise architecture planning.<br />James Smale<br />CEO<br />3<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Jason Baker<br />Jason Baker has over 15 years of experience working with Internet and telecommunications organizations in Minnesota. As CTO of VISI he helped architect ReliaCloud, the first public cloud computing platform in the Upper Midwest. Prior to VISI, he co-founded Digital North and was the technology leader within the organization. In his capacity as Director of Operations, Baker helped Digital North expand into multiple datacenters serving thousands of customers. <br />During the dot-com era in the late 1990’s, Baker was a key technology driver and partner at iPares, a multinational dot-com consultancy. Baker managed the profitable Application Hosting division within the organization. <br />Early in his career he joined MEANS Telcom, a regional telecommunications provider. As a member of their professional services team he worked closely with businesses during a time when the Internet was first becoming a useful business tool.<br />Jason Baker<br />CTO<br />4<br />Redpath Consulting Group confidential and proprietary 2010<br />

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About Redpath<br />Our mission is to help our customers leverage enterprise-class cloud computing technology. We can develop your cloud computing strategy, technology roadmaps, business value propositions, and cost-benefit analysis. We can deploy and support your cloud solutions.<br />We are recognized partners with leading cloud vendors:<br /><ul><li>Salesforce.com

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Google

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Visi/Reliacloud</li></ul>Let us show you how you can leverage the cloud.<br />www.redpathcg.com<br />5<br />Redpath Consulting Group confidential and proprietary 2010<br />

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About Visi /ReliaCloud<br />ReliaCloud, a product of VISI, is an enterprise-class cloud designed for businesses and that need dynamic infrastructure.<br />- Based in Minneapolis/St. Paul region<br />- 2 data center locations (SAS 70 Type II)<br />- 10+ years in data center business<br />- 24x7x365 live support<br />www.visi.com<br />Data Center 1: St. Paul, MN<br />6<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Agenda<br /><ul><li> Introduction to IaaS

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What should be considered for an IaaS ROI?

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What makes an IT Infrastructure component a good candidate for IaaS?

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How can an assessment help identify cloud IaaS opportunities?

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What about the organizational change management challenge?

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How do you build a hybrid IT Strategy that includes cloud components?

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How can you create a compelling business case to justify cloud components </li></ul> in your IT Strategy?<br />7<br />Redpath Consulting Group confidential and proprietary 2010<br />

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8<br />Redpath Consulting Group confidential and proprietary 2010<br />

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So What Is Cloud Computing and IaaS?<br />Cloud Computing is internet based computing, where shared resources like computer hardware, data, and software packages are provided on demand as a utility, very much like electricity is provided from the electricity grid.<br />Infrastructure as a Service (IaaS) - public cloud computing customers do not own their hardware infrastructure, so avoid capital expenditure by renting it from a cloud provider. <br />9<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Cloud Computing<br />Characteristics - Cloud users pay for what they use on either a utility model (like electricity) or a subscription model (like a newspaper). Low upfront costs to get started.<br />Economics (ROI) – Low cost to establish, elastic (you can have as little or as much of it as you want), pay for what you use, terminate contract therefore avoiding ROI risk and uncertainty.<br />Architecture - Cloud architectures typically involve multiple cloud components generally joined together (web services) with integration points to legacy systems. <br />10<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Data Centre Evolution<br />ApplicationSilos<br />Zones ofVirtualization<br />PublicCloud Services<br />PrivateCloud Services<br />Apps<br />Servers<br />Network<br />Storage<br />From silos…to Dynamic Data Center and IT as a service<br />Standardize<br />Virtualize<br />Departmental<br />Self-Service<br />Consolidate<br />Automate<br />Centralize<br />11<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Cloud Framework<br />Hybrid Clouds<br />Deployment<br />Models<br />Service<br />Models<br />Community<br />Cloud<br />Public Cloud<br />Private Cloud<br />On Demand Self-Service<br />Essential<br />Characteristics<br />Broad Network Access<br />Rapid Elasticity<br />Software as a Service (SaaS)<br />Platform as a Service (PaaS)<br />Infrastructure as a Service (IaaS)<br />Resource Pooling<br />Measured Service<br />Massive Scale<br />Resilient Computing<br />Common <br />Characteristics<br />Homogeneity<br />Geographic Distribution<br />Virtualization<br />Service Orientation<br />Low Cost Software<br />Advanced Security<br />12<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Business Models in the Cloud<br />VISI / ReliaCloud<br />Amazon EC2<br />Rackspace Cloud Server<br />Google App Engine<br />Microsoft Azure<br />force.com<br />Google Apps<br />Salesforce.com<br />Intuit<br />13<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Cloud Deployment Models<br />Private cloud <br />- Enterprise owned or leased<br />Hybrid cloud <br />- Shared by several organizations<br />Community cloud <br />- Shared by a few organizations<br />Public cloud <br />- Shared by the general public<br />14<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Business Need<br />Virtualized Storage<br />Servers<br />Virtualization-Aware<br />Unified Fabric<br />Abstraction is the key to IaaS<br />Horizontal Infrastructure<br /><ul><li>Abstraction breaks dependencies </li></ul> on physical hardware:<br /><ul><li>Mobility

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Cloning

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Scalability (up & down)

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Redundancy

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Dynamic provisioning

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Hardened security model

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Utility pricing (“Pay-as-you-go”)

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Formal Service Level Agreements

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Predictable Quality of Service </li></ul>Applications<br />Virtualization-Aware Network<br />Virtualized Dynamic Infrastructure<br />Service-Based Holistic Decision<br />15<br />Redpath Consulting Group confidential and proprietary 2010<br />

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What’s Driving Cloud Adoption?<br /><ul><li> Cost savings, economic uncertainty, and the CFO

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Security and regulatory requirements

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Accelerated time to delivery

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Elastic resources & scalability

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NEW apps vs. legacy apps</li></ul>16<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Cost of Traditional Data Centers<br /><ul><li> 11.8 million servers in data centers

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Servers are used at only 15% of their capacity

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800 billion dollars spent yearly on purchasing and maintaining </li></ul> enterprise software<br /><ul><li> 80% of enterprise software expenditure is on installation and maintenance of</li></ul> software <br /><ul><li> Data centers typically consume up to 100 times more per square foot than a</li></ul> typical office building<br /><ul><li> Average power consumption per server quadrupled from 2001 to 2006.

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Number of servers doubled from 2001 to 2006</li></ul>17<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Energy Conservation and Data Centers<br /><ul><li> Standard 9000 square foot costs $21.3 million to build with </li></ul> $1 million in electricity costs/year<br /><ul><li> Data centers consume 1.5% of our Nation’s electricity, </li></ul> doubling every 5 years.<br /><ul><li> Green technologies can reduce energy costs by 50%

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IT produces 2% of global carbon dioxide emissions</li></ul>18<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Faster Time to Value<br />Cloud Computing<br />Applications<br />Automated Upgrades<br />Large Operating Expenses<br />Cloud Computing Value<br />Value<br />Value<br />Time<br />No Capital Expenses<br />Upgrade Expense<br />Large Capital Expense & High Risk<br />Average 51% ROI <br />within 12 Months2<br />53% of software projects cost <br />189% of original estimate1<br />1 Standish Group, Chaos Report 2006<br />2 Third-Party CustomerSat Research on 3,500 Salesforce.com customers, December 2008<br />19<br />Redpath Consulting Group confidential and proprietary 2010<br />

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IaaS ROI<br />On Premise = Hidden Costs<br />Cloud Computing: 40% - 60% <br />Lower TCO<br />Licenses<br /> Hardware<br /> Consultants<br /> Infrastructure<br /> Dedicated Staff<br /> Upgrades<br />Pay-as-you-go<br />Commodity Hardware Infrastructure<br />Lower Implementation Costs<br />Faster provisioning<br />On demand scalability<br />Utility pricing<br />No capital investment<br />Fast deployment of sandboxes<br />Improved Service Levels (99.999%)<br />Simplified billing as expense<br />20<br />Redpath Consulting Group confidential and proprietary 2010<br />

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What Makes an IT Component a Good IaaS Candidate?<br /><ul><li> Need for on-demand test and development sandboxes

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An application that can be virtualized

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Servers with cyclical demand for scalability

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Email systems

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Storage systems

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Document management systems

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Content management systems

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Archive and redundancy servers

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Training servers

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Demo servers

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“Garage” applications</li></ul>21<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Using A Cloud Assessment to Identify IaaS Opportunities<br /><ul><li> Identify your business architecture

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Identify core business capabilities

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Understand your current technology </li></ul> architecture<br /><ul><li> Build an application inventory

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Build infrastructure inventory

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Identify Total Cost of Ownership (TCO)

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Generate your strategic options:

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Infrastructure lifecycle refreshes?

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Redundant or duplicate infrastructure?

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Infrastructure that can be virtualized?

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Commodity systems that can be moved to the cloud?

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Any quick wins?

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Select your strategies

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Create a hybrid IT strategy roadmap</li></ul>22<br />Redpath Consulting Group confidential and proprietary 2010<br />

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The Hybrid Cloud Assessment<br />23<br />Source: Redpath Consulting Group.<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Hybrid IT Cloud Strategy Roadmap<br /><ul><li> Should you replace every infrastructure component with the cloud? No

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Use a big bang strategy? No

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Use an incremental phased approach reduce risk? Yes

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Can startups can go directly to the cloud? Yes

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Does “the cloud” have the same meaning for each cloud vendor? No

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Do I have any commodity on premise systems? Probably

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Am I paying for capacity that I am not fully utilizing? Yes

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Can I use cloud components with my on premise IT? Yes

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Can I get similar service levels and quality of service? Yes

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Is the cloud secure? Yes</li></ul>24<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Org Change Management A Focus on Success<br /><ul><li> Reduce resistance to change

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Address job security fears

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Provide training and communicate benefits

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Expectation setting

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Address perceived loss of control

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Educate on security model to reduce concerns

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Manage people, process and technology change

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Position better use of IT resources

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Provide communication plan</li></ul>25<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Future will be in the clouds<br /><ul><li> You are probably already using cloud services

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Everyone wants IT to cost less and wants IT when they want IT

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Let your IT staff focus on innovation instead of infrastructure

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Get access to enterprise class systems at a reasonable price

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Are there clouds on your horizon? Yah you betcha….</li></ul>26<br />Redpath Consulting Group confidential and proprietary 2010<br />

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Promos<br />Free ½ Day Cloud Strategy Mini-Assessment *<br />Redpath Consulting Group will provide an experienced cloud strategy <br />consultant for ½ day to work with your business and IT team to perform an<br />assessment of your current state and identify cloud computing opportunities.<br />* For businesses with 25 employees or more. Contact Redpath about your specific situation<br />Free Cloud Server for Mini-Assessment - ReliaCloud<br />ReliaCloud will provide a $200.00 credit towards creating a cloud server <br />for you try out one of your apps in the cloud.<br />27<br />Redpath Consulting Group confidential and proprietary 2010<br />

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28<br />Redpath Consulting Group confidential and proprietary 2010<br />