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Thought Leaders In Cloud Computing: Ric Telford, Vice President Of Cloud Services, IBM (Part 3)

Posted on Friday, Aug 20th 2010

RT: That’s a good question. Generally, it’s reports – customized reports for sales people who could use that data, for example, average deal size for customers in a city, or the top twenty opportunities. Finance organizations see common usage of IRR, ROI, and other business calculations such as financial risk and liquidity. Sales and distribution are tracking the rate and pace of product sales and relevant trends in our markets globally to determine the best mix of products to introduce. In addition, we see common use of scorecards, dashboards, and BI reports for traditional performance management activities in and among the brands and business units.

SM: What I am sensing is that with this type of data, you have collected real-world data on what are the top analytic activities in a company such as IBM, which means that when you take that outside to IBM Global Services customers, there would be some proxy of that, right?

RT: Absolutely, and that’s exactly why we do it with Pat Toole’s organization. IBM is an excellent proxy for its customers. We see ourselves as developing an internal barometer of what our clients are going to see, and they shape with us the way we are going to market with a productized version of something like Blue Insight.

SM: Let me ask some questions about your clients from the perspective of cloud computing. The first question is about the business model. What are your hearing from the clients about the cloud business models? How significant is the business factor in selecting the cloud architecture or cloud providers? What is your general sense of what’s going on?

RT: The cloud started purely as a cost-savings initiative in many enterprises. They were looking at the IT costs and thinking about how the cloud could help them to cut costs. A lot of the business work we did with them with our cloud consulting folks and cloud design folks that help-we did ROI studies to help us figure out where we got the most bang for the buck in cloud computing. More often than not, it turned out to be some sort of testing and development where they could get some sort of return in less than a calendar year, and that was compelling. That could help these companies fund projects to get to the cloud and save money in the first year, which would help them bank money in the coming years. So, whether it would be for a desktop cloud, development cloud, or storage cloud, the primary motivators in the original setup has been building business models that show how we can save money. But now that people better understand the cloud, we are starting to see interesting things. People are starting to see the cloud not only from the cost-savings side, which will always be there, but also from the innovation side.

SM: And probably from the usability side as well. It’s a much more user-friendly model where people from all across the world can access data and information in a more user-friendly way.

RT: Right, there’s a sense of empowerment. When people offer a self-service model, you might think you are offloading your work to the customer, but traditionally if done right, self-service systems are very empowering to the people, and they embrace them. An ATM network is a good example. People like being able to go and get cash when they want to and on their terms, rather than being waited on by a teller.

SM: Yes, and the example that you gave earlier of a sales rep in a city looking for custom data for ASPs for his territory – these are custom reports that are best done on a self-service mode.

RT: Yes, there are a lot of different kinds of services. People like to do what-if scenarios. We have one of our research divisions use the computing and storage infrastructure as a service cloud. They are an IBM research team – scientists all over the world can use computing resources all over the world, and they can figure out the amount of computing or storage power, how much will that cost. They can say, maybe I will need that much; let me go back and change it. And they don’t have to keep issuing requests. They can change what-if scenarios on their own time. As you said, it makes it much more usable, and it is more empowering for people to be able to do that on their own.

This segment is part 3 in the series : Thought Leaders In Cloud Computing: Ric Telford, Vice President Of Cloud Services, IBM
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