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CIOs adopt down-to-earth cloud strategy

Ann Bednarz | Oct. 15, 2014
For CIOs at these large companies, being selective is the key to cloud success.

giants cloud primary
Credit: Chris Koehler

Editor's Note: Giants in the Cloud was written by Network World assistant managing editor, features, Ann Bednarz, based on interviews conducted by CIO Magazine managing editor Kim S. Nash, senior editor Brian Eastwood, Network World senior writer Brandon Butler and Computerworld technologies editor Johanna Ambrosio. This package, based on an idea from CIO executive editor Mitch Betts, was edited by Network World executive features editor Neal Weinberg, designed by Steve Sauer and illustrated by Chris Koehler.

CIOs are taking a pragmatic approach to cloud computing, selectively launching SaaS applications and shifting infrastructure resources to IaaS platforms while building their own private clouds.

In our interviews with CIOs and cloud leaders at 16 large enterprises we found that everybody is doing some form of cloud computing. But nobody is all-in on the cloud.

The CIOs we talked to are enthusiastic about the potential for cloud computing, but their optimism is tempered by realism. All are well aware of the challenges posed by decades of investments in legacy systems.

As Ray Voelker, CIO at Progressive Insurance, says: It would be "a whole new ballgame" if Progressive were some midsized business that didn't have an extensive data center footprint, but "we already have assets we own that we can leverage."

Like many other big companies, Progressive today relies on the public cloud mainly for SaaS applications that aren't core to running the business, such as HR management and expense reporting. On the infrastructure side, Progressive uses IaaS largely for experimentation. More widespread use of the public cloud is a ways off. "We're likely to continue to watch the move toward hybrid clouds very closely as that technology continues to develop and mature," Voelker says.

Likewise, Avnet, a $27 billion distributor of electronic components, has been building a private cloud internally for several years, while its public cloud usage is primarily limited to SaaS. Its biggest rollout, Microsoft Office 365, is just getting underway.

Avnet is open to wider use of public cloud services, says CIO Steve Phillips, and has identified three scenarios where it makes sense for the company: To provide functionality that's not a core competency for IT and wouldn't sacrifice competitive advantage; when there's a need to implement quickly and a cloud offering can reduce risk and capital expense; and when a short lifespan is expected.

Boston Scientific, too, is moving faster with SaaS than IaaS workloads.

"SaaS allows us to quickly support our business globally," says Rich Adduci, CIO at the medical device maker. "The ability to access a lightweight app, with a powerful back-end, and spin it up in minutes, is really a tremendous asset when you're moving in fast-paced markets." The "maturity level" of IaaS puts that on the "near-term horizon," Adduci says.


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