Continuous change is something that every business has to deal with today, yet the IT capacity required to meet that change is consistently underestimated. Soon businesses will need 10x more capacity, but they won’t be given 10x budgets to cope. Enterprises are challenged to respond faster while containing costs to remain competitive. One way to meet this challenge is through a different way of looking at the data center and the cloud.

The Classical Definition of Cloud Has Evolved

There are many definitions of the cloud, some of them ten or more years old. Wikipedia describes cloud computing with a metaphor:

For a user, the network elements representing the provider-rendered services are invisible, as if obscured by a cloud.

Wikipedia has some reservations about this classical cloud business model:

“Proponents claim that cloud computing allows companies to avoid upfront infrastructure costs, and focus on projects that differentiate their businesses instead of on infrastructure … Cloud providers typically use a “pay as you go” model. This can lead to unexpectedly high charges if administrators do not adapt to the cloud pricing model.”

Most people believe that cloud means renting the infrastructure from third parties on-demand, because it avoids capital investments in infrastructure. The new direction is to run applications across multiple clouds, because multiple clouds is the new reality in 2016. Enterprises often have a hybrid cloud and want to also use OpenStack, AWS, Digital Ocean, along with many more public and/or private clouds. Apcera’s CEO, Derek Collison, said in an interview with SiliconANGLE‘s John Furrier:

“People are expensive. This is the only resource that is getting more expensive. Right now when people say ’I have Amazon, and if I want to add something else [other clouds], I need to add more headcount who understand how to port to that platform, how to manage that platform.’ That is pretty prohibitive.”

Continues Derek:

The Battle for the Cloud used to be about [upfront] cost; it used to be about the geo-footprint. In my opinion, the battle of the cloud is around the class of services.

Derek mentions an enterprise customer running on Amazon, who wanted to use IBM Watson for data analytics. The only solution at the time was to move all the applications from Amazon to IBM Bluemix. The multi-cloud integration is not about apps A running only on AWS and apps B running only the hybrid cloud. The solution is to run any of the A and B apps on both hybrid and other clouds.

Ericsson’s Digital Industrialization Concept

How can you accomplish this feat? Through digital industrialization; Digital Industrialization is not about reducing a specific cost item (like infrastructure) or moving from CAPEX (Capital Expenditures) to OPEX (Operational Expenditures). It facilitates the overall management of the enterprise’s compute, data and network resources. It’s a continuous cycle. Digital industrialization turns the IT infrastructure from a cost into an asset, by:

  1. Standardizing on one set of technologies and economics across facilities, hardware, software, and operations
  2. Consolidating datacenters, abstracting functionality, automating operations
  3. Governing it all to ensure security, integrity, and compliance.

It’s not easy to re-think enterprise governance in an analytics-driven world. Digital industrialization will facilitate this transformation and will make the change natural. One of the best summaries of the digital industrialization process and how Ericsson Cloud addresses it comes from a short Quora post by Geoff Hollingworth, Digital Industrialist Wannabe and one the top cloud evangelists in Ericsson:

“Ericsson Cloud is not another piece of technology, but a toolbox that enables digital industrialization…. Ericsson Cloud consists of a number of independent products and services designed using the same technical advances the likes of Amazon and Google have adopted, but not shared.”

The last line is significant: both Amazon and Google use only in-house software and middleware components. Most clouds today tend to be defined by the engineering features and business models of their providers, not the needs of their enterprise customers. It is time for a cloud that is focused on the needs of the enterprise customer. Running an enterprise business on others’ clouds, which have their own security and governance rules, may be different from a cloud-adopting enterprise wanting to “turn IT infrastructure from a cost into an asset.” Each organization desires specific governance, compliance policy as part of a social contract that best fits its goals.

Part 2 | Part 3

Acknowledgements:  Many thanks to; Geoff Hollingworth whose one-line prompt generated the idea for this blog; to Rick Ramsey for asking excellent questions and editing; to Deirdre Straughan for managing expertly the production of this blog.

Digital Industrialization

Miha Ahronovitz

I graduated in engineering from Israel Institute of Technology, I am an alumini of Hass Business School at UC Berkeley in product management executive program. I was a co-founder of Gridware, acquired by Sun Microsystems in 2000, becoming the product manager of Sun Grid Engine. I am active in a group called The New Dandelion , fighting for the rights of young people who are highly functional autistic to gain a professional degree and become employed in mainstream companies.

Miha Ahronovitz