Introducing Appirio's first State of the Public Cloud Survey

Balakrishna Narasimhan

Today, we're very pleased to announce Appirio's first State of the Public Cloud Survey. Over the past four years we've been privileged to work on more than 800 cloud projects, and the difference between our customers' first-hand experience with cloud computing and how it was being portrayed in market and industry research always struck us as odd. Most of what we read is about security concerns or how cloud apps are a way for business to get around IT, when in fact, we rarely focus on security issues with customers outside the sales process and the majority of our day-to-day customers are IT. We started to wonder whether our customers were truly unique or whether there was a difference in how those who've tried and adopted a cloud solution behave relative to the market as whole.

So, this August, we worked with a third-party firm, Itracks, to host an online survey targeting IT decision makers at 155 mid-to-large US-based enterprises. What we found confirmed a few things we suspected, e.g., the majority of cloud adopters believe their cloud apps are better and are using cloud apps to change the role of IT within their businesses. But we were surprised by how positive cloud adopters are and how aggressively they plan to ramp up their adoption of public cloud solutions. We were also surprised that some challenges we'd expected to emerge over the next few years, such as cloud-to-cloud integration and more unified mobile access, are already becoming top priorities for cloud adopters.

Please check out the complete State of the Public Cloud report and leave us a comment or tweet @appirio with your biggest surprise from the survey.

Workday Rising 2010: Appirio Joins the Rising Revolution

Jennifer Taylor

Last week, we were thrilled to be a part of Workday Rising, Workday's annual event for customers and prospects. We were joined by 800+ customers, prospects, Workday executives and partners. Workday calls it the "Rising Revolution" and from the time we started setting up our table last Monday until the conference ended, it sure felt like we were part of a revolution. If you've ever used Oracle or SAP, you'll know how unusual this level of customer excitement is when talking about HCM or Financials. Workday is on a triple-digit growth trajectory and it's not hard to see why.

So, we thought we'd share our early thoughts about why Workday is generating so much excitement from its customers and partners.

1. Culture: It's almost a cliche to talk about Workday's unique culture that comes from founders Dave Duffield and Aneel Bhusri. They're both customer-oriented to the core and the values they've worked hard to instill are clear in every interaction that you have with anyone at Workday. Customers we talked to always mentioned how they always felt comfortable, even when things got challenging with their implementations, because of their trust in the Workday team. And the earnest pursuit of customer success is not without laughs. One of our favorite moments was when Dave Duffield deftly combined customer success and humor with a segment on how he (and his family) supported his customers from Chiquita Bananas to McKee foods to Sony Pictures and many more.


2. Compelling product and vision: It goes without saying that Workday has a compelling product. They're delivering a far superior user experience at much lower TCO than traditional HCM solutions. Senior executives at one of Workday's largest customers apparently say that Workday is the most successful IT project in their history. And HCM is just the start. By integrating Financials and HCM, Workday has a vision of giving enterprises insight into not only into where their teams are investing their time but also how this translates into business outcomes. Business systems of the past helped enterprises optimize how widgets got produced but did less well at helping enterprises manage their most precious resource, their people. By moving beyond transactions, integrating with financials and providing easy-to-use analytics, Workday could unlock significant new value within enterprises, many orders of magnitude beyond the TCO savings on the systems themselves.


3. Great customer community: We had heard a lot about Workday's traction with large enterprises but seeing is believing. What's amazing is to see enterprise IT and HRIS teams at large enterprises genuinely excited about what they're experiencing with Workday. We even talked to a few people at the event who were in the first week of their Workday go-lives. Try that with your on-premise system!


4. Lots of opportunity to innovate: Workday showed off a lot of exciting new features including mobile analytics, new reporting capabilities and a nifty Outlook plug-in that brings contextual Workday information right into email. In addition, Workday is making it easy for customers and partners to bring Workday information to business users. This is what makes it possible to build solutions like PeopleWorks that bring the power of Workday to the tools that people use to work.


5. Friendly ecosystem: Unlike other events where there's an air of cut-throat competition among competitors in the ecosystem, this was a much friendlier and collaborative affair. Workday takes pains to foster the idea that everyone is on one team and often brings together multiple partners to deliver the best solution to customers. Our interactions with other partners at the event reinforced this notion and made us excited to be able to contribute our cloud expertise and innovation to the ecosystem.

Along with Google and Salesforce, Workday is at the forefront of a dramatic shift in enterprise computing, toward a world in which even the largest enterprises run their businesses in the cloud and we're excited to help accelerate that shift!

Gartner Symposium ITxpo 2010 - Cloud Computing "Rights & Responsibilities"

Glenn Weinstein, CTO, Appirio

Gartner’s Daryl Plummer led a panel discussion this morning at Gartner Symposium ITxpo 2010 in Orlando, reporting on the findings of its Global IT Council for cloud services. Specifically, the council surveyed over 300 cloud computing users and used those results to formulate a “bill of rights” consisting of 6 rights and 1 responsibility for organizations that consume cloud computing services. The panel joined 4 members of the Global IT Council itself - Daryl plus 3 CIOs, from Marathon Oil, MIT’s Lincoln Laboratory, and International Finance Corporation - along with representatives from 3 providers - Accenture, Microsoft, and salesforce.com.

The reports highlights a largely uncontroversial set of customer rights, including the notion that vendors should provide users rights to control their own data, be notified of service issues, be made aware of legal requirements and security provisions, and to expect certain service level agreements. The one customer responsibility, in return, was merely to respect licensing restrictions.

The group spent little time debating the rights themselves, and moved into what seemed to be a more general discussion on core issues around cloud computing adoption, organizational responsibility, and vendor relationships.

In that discussion, the group articulated a much richer set of responsibilities that cannot be fulfilled by vendors, and therefore must fall to the (smart) customer. These fall into two key themes:

• If it’s technology, the CIO owns it. Marathon Oil CIO Thom Sneed made this point amid a discussion on today’s multi-vendor scenario (more “multi” than ever with the advent of cloud computing) as other panelists debated whether it’s fair for companies to seek “one throat to choke.” Thom said the answer to that question was simple - “when they are looking for whose throat to choke when something goes wrong, that’s easy... the CIO’s.” More broadly, the CIO and the IT organization continue to own ultimate accountability for the application and adoption of technologies that further business aims, even in a world where the VP of sales can go directly to salesforce.com and purchase licenses. That’s even more true when the first calls come into the help desk. It’s great that vendors provide customer success managers, account managers, and the like, but in the end, it’s the customer that bears true responsibility for putting the technology to best use.

• SLAs and penalty enforcement clauses are great, but customers need to be realistic about risk assessment. It’s tempting for a purchaser to demand punitive SLA clauses not just for lost productivity, but even perhaps for damages that could be caused by significant outages or other data issues caused by cloud vendors. But let’s get real - IT isn’t perfect, even (or especially) when it’s in-house. Do you ever find bugs in your homegrown software? Does your data center provide 5 nines of uptime for every application? Are you really willing to pay the price to ensure against any negative possibilities (either self-insurance via over-investment in IT internally, or externally via paying much higher prices), rather than making a realistic assessment of risk vs. reward? The cloud model provides tremendous direct value and comes with a track record of solid reliability, but not perfection. At some point, you’ve got to make your own cold-blooded assessment of the true risks associated with on-premise vs. cloud models, and figure out how much risk you can accept in return for the rewards. Just because it’s hosted doesn’t mean it’s any more risky, and in fact, it may be significantly less risky.

As adoption of public cloud computing goes mainstream in the enterprise, I suspect we’ll see more of these “adult conversations” between vendors and customers, where both parties bear significant responsibilities towards making a successful outcome. We may even see this dynamic as the catalyst leading to the rise of the cloud services brokerage, as Plummer defines it, whereby the brokerage not only mediates services on behalf of the customer, but also helps the customer meet the obligations on their end of the bargain.

Eight Insights from Gartner Symposium ITxpo 2010

Glenn Weinstein, CTO, Appirio

Gartner Symposium ITxpo 2010 in Orlando this week drew over 6,000 IT professionals, including 1,700 CIOs. The words most often heard in the keynote, sessions, and hallway chatter? "Cloud computing!"

We work every day with customers who have made commitments to the public cloud, so it’s easy to forget how revolutionary the concept can still be to the broader IT community. Thousands of companies are still stuck with largely on-premise architectures, and on-premise ideas. Here are eight insights from day one of the conference that challenge that thinking:

1. Cloud computing isn’t just about cost savings anymore. Gartner Research SVP Peter Sondergaard, kicking off the conference, listed cloud computing as #1 among 4 metatrends in IT, along with social computing (Facebook-style enterprise collaboration), context-aware computing (billions of connected devices that know their locations and contexts), and pattern-based computing (modeling future behavior via predictive analytics). But while IT has traditionally focused on optimizing internal processes, and cloud computing has often been sold based on cost savings, the future will be more focused on outcomes than costs. Talking about how cloud computing offers more "choice" to the business is another way of saying that time-to-market, not raw cost savings, will be the primary factor in architecture decisions.
   
   
2. Systems live on different layers, which call for different architectures. Gartner’s Eric Knipp and Yvonne Genovese introduced the following taxonomy of IT systems:
   
   • Systems of record, such as general ledger.
   • Systems of differentiation, such as a pricing engine.
   • Systems of innovation, such as a product promotion.
   We don't have to revolutionize every layer of IT at once. General ledger systems that are running on-premise don’t need to be our first target for moving to the cloud. For established enterprises, systems of innovation represent the best first opportunity to use cloud computing to deliver net-new business functionality. We may not change everything overnight, but when it comes to delivering altogether new systems that bring new ideas to life, we can avoid doing it the "same old way" for the same old costs and with the same old dependencies.
   
   
3. Privacy is a tradeoff. Sometimes, it's a good trade. Nick Jones, Gartner VP and Distinguished Analyst, asked these provocative questions: What if credit scoring services, which collect heaps of personal data about each of us, offered "opt-out?" Would you opt out? What if it meant your mortgage would go up 10%? We have accepted many such tradeoffs when the bargain seems good for individuals and for society as a whole. Imagine a future clothing line that could monitor your body functions, and alert an EMT such that an ambulance might pull up alongside you to urge you to "get in - you’re about to have a heart attack!"
   
   
4. Awareness of cloud computing still an issue. Gartner's Ben Pring introduced a few fairly well known analogies to explain cloud computing's appeal, including its parallels to utility-based electricity, telephony, and parcel delivery, as well as payroll and 401K processing. But these analogies still provide a powerful clarity to general audiences such as today's. When Ben asked for a show of hands of those who had a good idea of what salesforce.com was delivering, only a minority raised their hands. His introduction of concepts like infrastructure as a service (IaaS) was appreciated by his audience, which was also impressed (and horrified) to learn that according to Ben, 65% of all Siebel seats and 55% of all Peoplesoft seats never made it into production. Talking about cloud computing's "pay-as-you-go" model may strike some as 101 education, but it is still having a huge impact on the market.
   
   
5. With cloud computing, IT’s role changes - for the better. Ben claimed that with increased adoption of cloud computing, IT's role will evolve into overseers of process integrity, master data management, and workflow. In other words, as IT's burden for managing infrastructure declines, its ability to deliver higher-value services will increase. And what company couldn't use better and more intelligent ownership of these areas?
   
   
6. Private cloud is an evolution of virtualization. And virtualization leads inexorably to cloud computing. Those are (paraphrased) quotes from Gartner's Thomas Bittman, VP & Distinguished Analyst and a true expert in virtualization. Thomas explained that virtualization technology is moving through five stages of evolution:
   
   • Stage 1: Server virtualization
   • Stage 2: Distributed virtualization (across more than one machine)
   • Stage 3: Private cloud (adds self-service provisioning, standardization, & usage-based pricing)
   • Stage 4: Hybrid cloud (not within a single app, but overflow capability for the private cloud as a whole)
   • Stage 5: Public cloud
   Thomas says we are currently in Stage 2, and new products from VMware and Microsoft are moving us to Stage 3. But in the end, when security concerns are all addressed and businesses want the full benefit of operational expenses (over capital expenses) along with pay-per-use pricing, there’s no reason to believe any company will have a reason to cling to their private cloud past its next refresh cycle.
   
   
7. Want board funding for technology? Better come with a top-line growth story. Dr. James Cash's excellent lunch keynote illustrated this vividly. Dr. Cash, a board member at GE and Wal-Mart among others, told us that boards see two kinds of technology proposals:
   
   • Ideas that implicitly assume we will be in business long enough to implement them.
   • Ideas that will actually keep us in business.
   Naturally, you want your proposal to fall in the latter category. This requires that the CIO think in terms of top-line revenue growth, not merely operational efficiency. Indeed, Dr. Cash's position is that projects that target operational efficiency must be self-funding. Only projects that aim to add new sources of revenue merit separate funding. Takeaway: cloud computing is best suited for systems of innovation (see #2 above), which are most likely to have the potential for adding top-line growth.
   
   
8. The borders of the corporate network are crumbling. Cisco's Chris Kozup, in a session entitled "Business Innovation Anywhere, Any Time With Borderless Networks," argued that today’s "bordered network," with its reliance on IT-issued devices and requirement for VPN authorization prior to every login, was giving way to the "borderless network," characterized by access for "anyone, anywhere, any time, on any device." Cisco's answer today is a suite of products including its AnyConnect VPN client, "adaptive security appliance" (ASA) for large-scale device connectivity, and even single sign-on for endpoints like salesforce.com. But ultimately the concept should lead to a corporate network architecture that lets users access systems with the same ease regardless of whether those systems are public cloud-based or "internal" systems.
   
   Can you imagine a world where concepts like firewalls, DMZs, and VPNs fade into the background? I can - when standards such as two-factor authentication, OpenID, and Oauth become ubiqitous, making users and IT feel just as comfortable with public cloud-based systems as they do with “internal” systems that are protected by a traditional corporate network.

Day 1 down, many more insights to come. Stay tuned for tomorrow’s update!

Top 5 Disappointments as Cloud Computing enters the 'Trough of Disillusionment'

Gartner released its 2010 "Hype Cycle" report, identifying cloud computing as "at the peak of inflated expectations." It's clear that expectations around cloud computing are huge. But if you approach cloud computing with a business-case driven roadmap, and focus on the services provided by public cloud leaders, disillusionment isn't inevitable. Here's a tongue-in-cheek top 5 list of the things I think you'll actually be disappointed in as you do more in the public cloud...
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